Wenzel Machinery Rental & Sales Co. v. Adkins

• Court: Kansas Supreme Court
• Writing for the Court: PARKER
• Citation: Wenzel Machinery Rental & Sales Co. v. Adkins, 370 P.2d 141, 189 Kan. 435 (Kan. 1962)
• Decision Date: 07 April 1962
• Docket Number: No. 42466,42466
• Parties: WENZEL MACHINERY RENTAL AND SALES COMPANY, Inc., Appellant, v. Temple ADKINS, a/k/a Temple Adkins, Jr.; Temple Adkins, II, T. H. Adkins; Temple Atkins; Temple Atkins, Jr.; Temple Atkins, II; T. H. Atkins, and Ernie Rieke, Appellees.

Page 141

370 P.2d 141

189 Kan. 435

WENZEL MACHINERY RENTAL AND SALES COMPANY, Inc., Appellant, v. Temple ADKINS, a/k/a Temple Adkins, Jr.; Temple Adkins, II T. H. Adkins; Temple Atkins; Temple Atkins, Jr. Temple Atkins, II; T. H. Atkins, and Ernie Rieke, Appellees.

No. 42466.

Supreme Court of Kansas.

April 7, 1962.

Syllabus by the Court.

1. The provisions of G.S.1949, 52-218, are not to be construed as precluding the stating of a cause of action on a promissory note against a joint adventurer, whose individual signature does not appear on the note, when such note has been executed by one of the joint adventurers in the name of the joint adventure.

2. A person who signs by a trade, partnership or other assumed name is not undisclosed within the meaning of the rule (see G.S.1949, 52-218) that no person is liable on a promissory note whose signature does not appear thereon.

3. In an action on a promissory note the record is examined and it is held that, under the facts, conditions and circumstances set forth in the opinion, the trial court erred in sustaining the defendant Rieke's motion to dismiss the action and in sustaining the defendant Adkins' demurrer to the petition.

Robert T. Cornwell, Wichita, argued the cause, Wayne Coulson, Paul R. Kitch, Dale M. Stucky, Donald R. Newkirk, Robert J. Hill, Gerrit H. Wormhoudt, Philip Kassebaum, John E. Rees, Willard B. Thompson, and David W. Buxton, Wichita, with him on the briefs, and Homer V. Gooing and Hugo T. Wedell, Wichita, of counsel, for appellant.

Elvin D. Perkins, Emporia, argued the cause, Everett D. Steerman, Emporia, with him on the briefs, for appellee Adkins.

James D. Howell, James D. Howell, Jr., William E. Scott, Francis J. Donnelly, and LaVone A. Daily, Kansas City, on the briefs for appellee Rieke.

PARKER, Chief Justice.

This was an action to recover money on a promissory note.

Plaintiff, Wenzel Machinery Rental and Sales Company, Inc., commenced the action on January 19, 1960, by filing a petition in the district court of Chase County, naming Temple Adkins a/k/a Temple Adkins, Jr.; Temple Adkins, II: T. H. Adkins; Temple Atkins; Temple Atkins, Jr.; Temple Atkins, II; T. H. Atkins, a resident of such county as the sole defendant. By an amendment to the petition, dated February 3, 1960, Ernie Rieke was added as defendant and, pursuant to G.S.1949, 60-2502, summons was served on him in Wyandotte County. Rieke filed a motion to quash this service which was sustained. Thereafter, and on March 8, 1960, a praecipe for an alias summons on such defendant was filed and residential service was obtained on him on March 18, 1960, in Wyandotte County. A subsequent motion to quash this service of summons was overruled. Later, and on May 24, 1960, plaintiff filed an amended petition.

For reasons to be presently noted it is neither necessary nor required that we burden this opinion by detailing the allegations of the foregoing pleadings. It suffices to say the note sued on, which was attached to and made a part of the initial petition, as well as the amended petition on May 24, 1960, reads as follows '$17,926.72 City--Kansas City, Kans.--Kansas--Date February 20th, 1954.

'FOR VALUE RECEIVED, I promise to pay to Wenzel Machinery Rental & Sales Co. or order the sum of Seventeen thousand nine hundred twenty-six and 72/100--DOLLARS at Kansas City, Kans.--City--State--Kansas--in installments payable as follows, to-wit: One thousand four hundred and ninety-three & 9 0/00 Dollars on the 20th day of March, 1954, and $1,493.90 Dollars on the 20th day of each succeeding month thereafter, until above named sum is paid in full with interest on each installment from its maturity until paid, at the rate of eight per cent per annum; and agree to pay reasonable collection charged and attorneys fees and all expenses in case of default.

'If default is made in the payment of any installment when due, then all the remaining installments shall, at the election of the holder hereof, become due and payable at once. All signers, endorsers and parties to this instrument hereby waive presentment, protest and notice of nonpayment. This note is secured by a chattel mortgage on Lima Diesel #802 Dragline ser. #1028 1 1/2 K.W. Kobler Light Plant.

'S/Ernie Rieke Equipt. Co.

'S/Ernie Rieke'

Following the filing of the last mentioned pleading Rieke's motion to dismiss the action and Adkins' demurrer to the petition were sustained. Thereupon plaintiff perfected appeals from both rulings and brings the case to this court under a single specification of error charging that the trial court erred in sustaining defendant Rieke's motion to dismiss and defendant Adkins' demurrer because the petition and amended petition alleged joint and several liability against both defendants, as members of a joint venture, on a promissory note executed by said joint venture.

This is one appeal where, by their unqualified admissions, the parties agree that their appellate rights must stand or fall upon this court's decision of one question. This is fully demonstrated by statements appearing in the briefs of the respective parties to which we shall now direct attention.

In its brief, with respect to the nature of the action, appellant states,

'This is an action by the payee (appellant) on a promissory note executed by a joint venture as maker against two (2) of the joint venturers to recover the unpaid balance of the note. The trial court sustained a motion to dismiss as to the nonresident defendant (appellee Rieke) and a demurrer as to the other defendant (appellee Adkins). Both rulings have been appealed.'

and then, at page 13 of such brief, states the question involved is:

'When a negotiable promissory note is executed in the name of a joint venture as maker by one of the joint venturers is another member of the joint venture jointly and severally liable on the note although his individual signature does not appear on the note?'

Appellees, in their joint brief, make the following statement:

'Appellees agree that the only matter to be determined by this appeal is adequately stated in the 'Question Involved' portion of appellant's brief, on page 13, since appellant has conceded that all theories of recovery, except an alleged action on a note, were barred by various and sundry statutes of limitation. Briefly stated then, if appellant failed to state a cause of action against appellee Adkins, then the rulings of the District Court were correct, both as to appellee Adkins and as to appellee Rieke.'

The record presented, and admissions made by the parties in connection with proceedings had in the court below, make it appear that, assuming all other allegations of the petition as amended were sufficient to disclose a joint adventure, the trial court's rulings, sustaining Rieke's motion to dismiss and Adkins' demurrer, were based wholly upon the ground such pleading nevertheless failed to state a cause of action against Adkins for the reason no cause of action was or could be stated against him on the note because his signature did not appear thereon.

Thus, mindful of the established rule that joint adventures and partnerships are so similar in nature that they are governed by the same rules of law (See Brown v. Dye, 165 Kan. 507, 509, 195 P.2d 607; Grannell v. Wakefield, 172 Kan. 685, 242 P.2d 1075; 30 Am.Jur., Joint Adventures, § 4, p. 940; 48 C.J.S. Joint Adventures §§ 1, 13, 15, pp. 806, 807, 865, 871) we come to the sole question involved in this lawsuit.

Are the provisions of G.S.1949, 52-218, a part of our negotiable-instrument law, which read:

'No person is liable on the instrument whose signature does not appear thereon, except as herein otherwise expressly provided; but one who signs in a trade or assumed name will be liable to the same extent as if he had signed in his own name.'

to be construed as precluding the stating of a cause of action on a promissory note against one joint adventurer, whose individual signature does not appear on the note, when such note has been executed by one of the joint adventurers in the name of the joint adventure?

Directing our attention to the fact that in sustaining Rieke's motion to dismiss because the petition as amended failed to state a cause of action against Adkins, the trial court based that ruling squarely on Plains State Bank v. Ellis, 174 Kan. 653, 258 P.2d 313, appellees strenuously contend that case, we well as Federal Deposit Ins. Corp. v. Cloonan, 165 Kan. 440, 196 P.2d 195, require an affirmative answer to the question just posed. We do not agree.

In the first place both cases are factually distinguishable from the case at bar in that in Plains State Bank v. Ellis, supra, recovery was denied against a nonsigning partner on a note that was signed by a partner in his individual name only, not in the partnership name; while in Federal Deposit Ins. Corp. v. Cloonan, supra, (disposing of three consolidated appeals) rulings sustaining three separate demurrers to three amended petitions were affirmed on the basis an individual (Cloonan), whose name did not appear on the notes sued on, could not be held liable on notes signed by three separate persons solely in their individual capacities, even though the petitions alleged such notes evidenced the indebtedness of Cloonan for money he had received from the payee bank from which Federal Deposit Insurance Corporation had acquired the instruments.

In the next place, conceding that the first paragraph of the syllabus in each of the last mentioned cases holds that by reason of G.S.1949, 52-218, no person is liable on a promissory note whose signature does not appear thereon unless liability is imposed by other provisions of such law, it must be remembered that by legislative fiat (see G.S.1949, 60-3329 and G.S.1949, 20-203) a syllabus is confined to points of law arising from the facts of the case that have been determined by the court and is in no sense to be construed as reaching out...