Smith v. Tracy

• Decision Date: 11 November 1963
• Docket Number: No. 49457,No. 1,49457,1
• Citation: 372 S.W.2d 925
• Parties: Noel SMITH (Plaintiff), Appellant and Respondent, v. Stuart TRACY and Isis Tracy, his wife, Charles Tracy and Viola Tracy, his wife, d/b/a Tracy Brothers (Defendants), Respondents and Appellants
• Court: Missouri Supreme Court

Page 925

372 S.W.2d 925

Noel SMITH (Plaintiff), Appellant and Respondent, v. Stuart TRACY and Isis Tracy, his wife, Charles Tracy and Viola Tracy, his wife, d/b/a Tracy Brothers (Defendants), Respondents and Appellants.

No. 49457.

Supreme Court of Missouri, Division No. 1.

Nov. 11, 1963.

Motion for Rehearing or to Transfer to Court En Banc Denied

Dec. 9, 1963.

Rendlen & Rendlen, Hannibal, J. Patrick Wheeler, Canton, for appellants Tracys.

Tom B. Brown, Edina, and J. Andy Zenge, Jr., Canton, for respondent Smith.

HOLMAN, Judge.

The various controversies that have arisen between plaintiff and defendants, as hereinafter detailed, resulted from a contract whereby defendants agreed to purchase plaintiff's 732-acre farm located in Lewis County, Missouri. In this ejectment action plaintiff, alleging that defendants had breached the contract in a number of respects, sought possession of said land. Defendants filed an answer and a counterclaim consisting of five counts. In the first count defendants sought to recover $100,000 actual and $200,000 punitive damages because of the alleged false representations of plaintiff which induced defendants to agree to purchase said farm. Count II sought damages resulting from plaintiff's false representations which induced defendants to agree, in March 1957, to purchase from plaintiff, a grain elevator located in Quincy, Illinois. In the third count, defendants sought a decree reforming the various contracts in order to conform to an oral agreement of modification alleged to have been entered into subsequent to the execution of said contracts. Count IV was based upon the theory of rescission and sought recovery of various sums of money as a result thereof. The fifth count sought to restrain plaintiff from selling a 188-acre farm defendants had contracted to buy from plaintiff's mother on February 10, 1958.

This case was tried before the court and testimony was taken from time to time on approximately 25 different days over the period of a year, commencing March 15, 1961. The transcript and supplemental transcript contain 2,500 pages of testimony and there are several hundred exhibits. Much of the testimony, however, related to issues which are not involved on this appeal, and in our statement of facts we will endeavor to recite only the evidence pertinent to the issues now presented to us.

During the year the case was being tried defendants retained possession of the farm and because of that fact, in the fall of 1961, plaintiff sought and obtained an injunction relating to the disposition of the crops and later obtained the appointment of a receiver to harvest the crops and retain possession thereof pending the outcome of the case.

At the conclusion of the trial the court filed a memorandum wherein it was found that defendants had defaulted in various payments due under the contract of sale and that by reason thereof, plaintiff was entitled to possession of the premises, together with a judgment for the reasonable rental value of the premises at the rate of $1,000 per month from January 15, 1961, the date plaintiff had demanded possession. The court found for defendants on Count I of their counterclaim and indicated that they were entitled to recover actual damages in the sum of $56,828.18 and punitive damages in the amount of $25,000, making a total judgment of $81,828.18.

The trial court found for plaintiff on Counts II, III, and IV of defendants' counterclaim. The court also found for plaintiff (to whom the land had been conveyed by his mother) on issues relating to default in payments on the contract relating to the 188-acre farm involved in Count V, but provided that there would be no forfeiture if defendants would pay the amounts in default on or before March 15, 1962.

On March 31, 1962, the court entered final judgment in accordance with the findings heretofore mentioned. The court also entered an additional judgment approving (1) the accounting of the receiver and allowing the receiver compensation in the amount of $2,200, and his attorney compensation in the sum of $1,200, and providing that defendants were entitled to all assets remaining in the hands of the receiver; (2) that the costs of receivership be borne one half by plaintiff and one half by defendants; and (3) that plaintiff was entitled to receive certain A.S.C. government payments on the 1962 crop program, and that defendants were entitled to the 1961 corn crop and the 1961 A.S.C. payments. Court costs of the case were assessed one half against plaintiff and the remaining one half against defendants. Plaintiff and defendants have each appealed from that judgment.

Plaintiff, upon this appeal, contends that defendants were not entitled to any judgment on Count I of their counterclaim. Defendants here contend that they were entitled to a much larger judgment on Count I of their counterclaim, and that the court erred in assessing any of the costs of the receivership against them. Although the evidence first adduced related to proof of the allegations in plaintiff's petition, we have decided to state first the evidence offered by defendants as such will present a better background for an understanding of the events which culminated in the execution of the various contracts and the matters involved in the alleged breach thereof.

Stuart Tracy testified that in 1955 he lived near Beardstown, Illinois, and that he and his brother Charles operated a 524-acre farm which they owned and another 556-acre farm which they had rented for a number of years; that they had engaged in grain farming and in the raising of purebred Duroc hogs and purebred Angus cattle; that in December 1955 he was contacted by J. M. Britton, a real estate agent who was associated with C. F. Bell in endeavoring to sell plaintiff's farm; that on December 27, Mr. Brotton accompanied him, his brother Charles, his father, and his son Rex, on a trip to look at the farm. Upon arrival there they met plaintiff who took them on a tour of the farm in his automobile. In addition to the ordinary farming operations, they learned that plaintiff had been conducting a garbage feeding operation on this farm. Stuart further testified that plaintiff told them that during the past three years the farm had been rented to Mr. Uhland and Mr. Henry who operated the farm and the garbage feeding operation, plaintiff receiving 50% of the net profit and each of the tenants receiving 25% thereof; that they learned from plaintiff that he had an exclusive contract with the City of Quincy to receive the garbage collected in that city, and that this garbage was cooked in accordance with the requirements of Missouri law and fed to the hogs; that plaintiff told them the garbage feeding operation was very profitable and that he would assign his garbage contract to anyone who purchased the farm; that plaintiff told them he would sell the farm for $208,620, with $25,000 paid down and the balance to be paid in ten years, together with interest at 5%. He stated that on January 2, 1956, he and Charles returned to the farm, accompanied by their wives and his son Rex, and that on that occasion plaintiff took them on another tour of the farm, after which they returned to the main farm house where they conferred at some length with plaintiff.

Stuart testified further that at that conference plaintiff explained to them how the garbage was processed, and advised them that the boiler plant, tractor, loader, and other equipment used in connection with that operation would be sold with the farm; that plaintiff explained that the plant was not in operation at that time because his two tenants had quit operating the same and were leaving the farm and he had no labor to operate the plant; that they asked plaintiff about the profits of the garbage feeding operation during the years 1953, 1954, and 1955, and he told them that his share of receipts from that operation averaged a gross of $34,000 annually and a net profit of $21,000 a year; that the hogs would each gain 1 3/4 pounds per day and that each hog would not eat more than two pounds of corn per day in addition to the garbage. Stuart further stated that plaintiff told them that they had fed an average of 3,000 head of hogs per year, that garbage was a perfect food for hogs, and that his hog losses were very negligible; that he would lose a hog every ten days or two weeks, usually caused by a toothpick in the garbage; that there was no problem concerning disease; that plaintiff also represented that the pond which furnished water for the hog feeding operation was 20 feet deep and contained an adequate supply of water for that operation; that plaintiff also stated that there was ample commercial grain storage space which could be obtained locally at a rental of 1cents per bushel per month; that at that meeting plaintiff brought out a pile of papers which he said were his records of the farm operation during the past three years, but that they could not 'make heads or tails' of these records, and asked him to state the facts to them; that as he did so they made notes as to what he said.

Stuart further testified that on the following day he returned to the farm with Mr. A. C. Hart, president of a bank in Arenzville, Illinois, and a Mr. Lewis, a field representative of National Stock Yards National Bank, National Stock Yards, Illinois; that plaintiff at that time took them on a tour of the farm and at the conclusion thereof this group went into the house and talked about the farm. At that time plaintiff told them that the farm land had already been leased for the year 1956, but that if they bought the farm they would have posession of the main farm home and a tract of about 30 acres used in connection with the garbage feeding operation, and another 60 acres of pasture land; that on this occasion plaintiff again explained the garbage feeding operation and stated the profit he had made thereon during the past three years and repeated...