State ex rel. Boswell v. Curtis

• Decision Date: 20 April 1960
• Docket Number: No. 7847,7847
• Citation: 334 S.W.2d 757
• Parties: STATE of Missouri ex rel. James E. BOSWELL, Relator, v. Honorable Claude E. CURTIS, Judge of the Circuit Court of Laclede County, Missouri, Respondent.
• Court: Missouri Court of Appeals

Page 757

334 S.W.2d 757

STATE of Missouri ex rel. James E. BOSWELL, Relator, v. Honorable Claude E. CURTIS, Judge of the Circuit Court of

Laclede County, Missouri, Respondent.

No. 7847.

Springfield Court of Appeals, Missouri.

April 20, 1960.

Donnelly & Donnelly, Robert T. Donnelly, Lebanon, Neale, Newman, Bradshaw, Freeman & Neale, Jean Paul Bradshaw, Donald J. Hoy, Warren S. Stafford, Springfield, for relator.

Dillard & Grossenheider, Paul J. Dillard, Lebanon, for respondent.

RUARK, Judge.

We issued preliminary writ of prohibition against the circuit judge to desist from enforcing an order requiring the relator to produce for inspection, copying or reproduction certain copies of his income tax returns. Return has been made wherein the respondent admits the facts alleged in paragraphs, I, II, and III of the petition for the writ and, in effect, denies all other allegations of said petition. The relator has filed motion for judgment on the pleadings, and the parties have chosen to submit the case for decision on this state of the pleadings. Hence we determine the case on the facts alleged in the first three paragraphs of the relator's petition. ¹

From the petition and its attached exhibits it appears that one Claude Waterman has sued the relator, James E. Boswell, for alienation of the affections of Waterman's wife. Exemplary or punitive damages were prayed. After various pleadings which put the case at issue, plaintiff Waterman filed a motion to require the defendant in that case (relator here) to produce various papers, including copies of 1957 and 1958 income tax returns, under the allegations that they are necessary to plaintiff in preparation of his lawsuit in reference to punitive damages and that they contain evidence material toward the determination of defendant's wealth. The order of the court is not brought up as a part of the record or exhibits, but, as we get from the petition, the motion was called up for hearing (what evidence, if any, was offered in support or rebuttal of the motion is not related or shown); and it was stipulated (1) the relator and his wife filed joint income tax returns, both state and federal, for the years 1957 and 1958, (2) the returns included income earned individually by relator in those years, (3) relator was paid $1,000 per month salary during these years and reported such on the joint returns, (4) relator and his wife jointly owned a majority of the common stock of the Independent Stave Company, a Missouri corporation. The motion was sustained in respect to the income tax returns, and relator was ordered to produce them for inspection, copying or reproduction.

In support of his motion for judgment here, the relator contends (I) the returns are not material to any issue in the case, and (II) they are privileged.

Were they material? Section 510.030, V.A.M.S., provides that upon motion of any party showing good cause therefor the court may order any party to produce documents or papers which constitute or contain evidence material to any matter involved in the action. This section is to be given a liberal construction. The tendency is to broaden the scope of discovery when necessary to expedite justice and guard against surprise. ² It must appear, however, that the evidence so to be produced is material and relevant to the issues. ³ And it cannot (could not) be used merely as a 'fishing expedition,' or on 'mere suspicion,' or simply to produce evidence which would be hearsay or would be used only for the purpose of impeachment. ⁴ But the evidence so produced need not necessarily, standing alone, be competent or relevant. It is sufficient if it forms a chain or link which, when connected with other evidence, will be relevant and material. The simple test is whether the evidence sought tends to prove an issue. If it so tends it cannot be excluded. ⁵

In a suit against one person where exemplary damages are involved, the defendant's wealth or financial condition is competent and relevant--this upon the long-held theory that punitive damages are for punishment and the jury can better assess a fitting punishment if it has knowledge of defendant's financial situation. ⁶ The filed covered by this character of evidence has usually been referred to in broad terms. ⁷ But in Traw v. Heydt, Mo.App., 216 S.W. 1009, 1011, the St. Louis Court of Appeals constricted the field by holding that the showing of entirety property was error because such ownership did not enable the appellant 'to respond to any judgment.' And in Brown v. Payne, Mo., 264 S.W.2d 341, 346, the admission of a joint income tax return in its entirety was held error. It would therefore appear that any part of the returns which had to do with the wife's income or entirety property would not be relevant or competent.

But the joint return could also show other income of relator in respect to both earned income and income from other property produced without effort on the part of relator, such as, for instance, rentals on real estate and dividends on corporate stock. Without finding it necessary to decide whether last year's salary, in these days of 'live it up now,' is any evidence of this year's wealth, we observe that a continuous or fixed salary or other income might be subject to garnishment on execution and therefore be a factor in determining 'ability to respond to judgment.' The rentals on real estate and income from other investments could be some evidence of the value of the property. ⁸ And such factors, when taken and 'connected up' with other evidence which plaintiff may have, could be relevant and material on the question of relator's total wealth.

Here we find it advisable to state two of the rules applicable to cases of this kind. In a discovery proceeding in the circuit court the burden is upon the movant to show that the documents so desired for examination contain evidence which is material to the issues. State ex rel. Iron Fireman Corporation v. Ward, 351 Mo. 761, 173 S.W.2d 920, 923, and cases post. But when we consider the question here on prohibition the presumption is that of right action on the part of the respondent. The relator has the burden to establish that the respondent acted without reasonable basis for his order and thus exceeded his jurisdiction. State ex rel. Cummings v. Witthaus, 358 Mo. 1088, 219 S.W.2d 383, 8 A.L.R.2d 1124; State ex rel. Headrick v. Bailey, 365 Mo. 160, 278 S.W.2d 737; State ex rel. Terminal Railroad Association of St. Louis v. Flynn, 363 Mo. 1065, 257 S.W.2d 69; State ex rel. Clemens v. Witthaus, 360 Mo. 274, 228 S.W.2d 4; see State ex rel. Phelps v. McQueen, Mo., 296 S.W.2d 85.

We do not know what showing the respondent had before him at the hearing. We find attached to respondent's suggestions copy or partial copy of relator's deposition, wherein it appears that the relator was somewhat evasive, suffered some memory loss, and in some instances flatly refused to answer questions in reference to his financial circumstances. Whether the court had this deposition before him we do not know, but in the absence of any showing that there did not exist 'some basis for an inference that the paper contains material evidence' (State ex rel. Missouri Pacific R. Co. v. Hall, 325 Mo. 102, 27 S.W.2d 1027, 1028), and when the documents are 'reasonably probable to be material,' ⁹ we must presume that the court acted rightly. A movant should not be held on 'too strict a showing' of the content of a record which he has never seen. State ex rel. Iron Fireman Corporation v. Ward, supra, 173 S.W.2d loc. cit. 923; State ex rel. Cummings v. Witthaus, supra, 219 S.W.2d loc. cit. 387, and cases there cited. We recognize that the order to produce cannot ordinarily be so broad as to include both relevant and inadmissible matters. ¹⁰ But in this case we know of no way the court could have ordered an examination of the returns for relevant evidence without opening the whole returns. As to just what portions of the returns will be admissible in evidence can be decided only at the trial, but we are of the opinion that the relator has not met his burden of showing that the respondent acted in excess of his jurisdiction on the question of relevancy.

On the question of privilege: Lois Boswell, wife of the relator, and Independent Stave Company, a corporation, have joined in the petition for prohibition. The question then involves the privilege of (a) the maker of an income tax return who is a party to the suit, (b) a joint maker who is not a party, (c) an independent corporation which is not a party but has paid dividends to (and perhaps had other dealings with) the maker of the return.

Relator contends that the effect of the federal statute (26 U.S.C.A. Sec. 7213) and the state statute (143.270, RSMo, V.A.M.S.) makes the copies of all income tax returns privileged as a communication between the taxpayer and his government. ¹¹ We do not so read the statutes, and the majority of authority and the present tendency is that there is no absolute privilege in respect to copies of income tax returns in favor of the taxpayer against the valid process of a court engaged in a proper inquiry within its jurisdiction. ¹²

We are unable to find any Missouri case which squarely passes upon this point, although it may be said to have been touched in State ex rel. Cummings v. Witthaus, supra, 219 S.W.2d loc. cit. 388. Brown v. Payne, supra, 264 S.W.2d 341, cited by both sides, we think does not really decide the question. We are of the opinion that the copies, when relevant, are not privileged.

As for any other privilege which might be claimed by the wife or corporation:

The constitutional limitations upon search and seizure apply only to the owner or person in possession. State v. Green, Mo., 292 S.W.2d 283, and cases cited at loc. cit. 286. The documents called for were not the property of or in possession of the corporation. Under these circumstances papers which disclose the amounts paid by...