Wood v. Kansas City Home Telephone Co.

• Decision Date: 27 November 1909
• Citation: 123 S.W. 6,223 Mo. 537
• Parties: HENRY WOOD, Trustee, Appellant, v. KANSAS CITY HOME TELEPHONE COMPANY, ED. L. BARBER, JAMES S. BRAILEY, JR., and O. C. SNIDER
• Court: Missouri Supreme Court

123 S.W. 6

223 Mo. 537

HENRY WOOD, Trustee, Appellant, v. KANSAS CITY HOME TELEPHONE COMPANY, ED. L. BARBER, JAMES S. BRAILEY, JR., and O. C. SNIDER

Supreme Court of Missouri, First Division

November 27, 1909

Appeal from Jackson Circuit Court. -- Hon. John G. Park, Judge.

Reversed and remanded (with directions).

C. B Stark and Elijah Robinson for appellant.

(1) Plaintiff and his associates had a perfect right to buy the franchise from Enoch, regardless of whether they had notice of the contract that Enoch had made with the Central Construction Company. Land & Gravel Co. v. Com. Co., 138 Mo. 439; Chambers v. Baldwin, 91 Ky. 121; Bourlier v. Macauley, 91 Ky. 135; Boison v Thorn, 98 Cal. 578; McCann v. Wolff, 28 Mo.App 447; Cooley on Torts, 497. (2) The compromise of the controversy between the People's Telephone Company and the Home Telephone Company constituted a sufficient consideration for the contract herein sued on. Reilly v. Chouquette, 18 Mo. 220; Livingstone v. Dugan, 20 Mo. 102; Hill v. Coal Co., 124 Mo. 153; Silliman v. U.S. 101 U.S. 465. (3) The contract sued on was not procured by duress. Morgan v. Joy, 121 Mo. 677; Wolfe v. Marshall, 52 Mo. 167; Dausch v. Crane, 109 Mo. 323; Sullivan v. U.S. 101 U.S. 465. (4) The circuit court had jurisdiction to decree the specific performance of the contract sued on. State ex rel. v. Smith, 104 Mo. 419; State ex rel. v. Ellins, 130 Mo. 90; Burke v. Kansas City, 118 Mo. 309; Leonard v. Sparks, 117 Mo. 103; Musick v. Company, 114 Mo. 309; State ex rel. v. Neville, 110 Mo. 345; State ex rel. v. Withrow, 108 Mo. 1; Pope v. Blair, 105 Mo. 85. (5) Under the evidence in this case the court should have decreed specific performance of the contract sued on. Waterman on Specific Performance, secs. 16 and 19; Pomeroy on Contracts, secs. 15, 17 and 19; Fry on Specific Performance, 1469.

A. F. Broomhall and Ward, Hadley & Neel for respondents.

Rights not yet acquired may be assigned. The contract of September 28, 1901, between Barber and Enoch constituted a complete assignment of the telephone franchise to the Kansas City Home Telephone Company. Enoch having acquired the property, Barber and the Telephone Company having advanced the consideration on the faith of the assignment their rights became vested and could not be impaired by any act of Enoch's. Pomeroy's Eq. Jur., secs. 369, 373; Warren v. Bank, 25 L. R. A. 746; Johnson v. Bryson, 27 Mo.App. 341; Schubert v. Herzberg, 65 Mo.App. 578. A vendor of personal property cannot confer a better title than he has. The Peoples Telephone Company stood in Enoch's shoes and as he had no rights it had none. Anson on Contracts, sec. 302; Owens v. Evans, 134 N.Y. 514; Kerohan v. Durham, 48 O. S. 1; Smith v. Sterritt, 24 Mo. 260. If the claim, the waiver of which is relied upon as a consideration, cannot be entertained in good faith a compromise based upon such a waiver lacks consideration and is void. Restoring to an injured party his chattels of which he has been wrongfully dispossessed is not a good consideration to support a promise to pay money to the wrongdoer. Morgan v. Hodges, 15 L. R. A. 438 (note); Keeler v. Neel & Watts (Pa.), 424, C. Y. C., vol. 8, page 509; Morey v. Newfane, 8 Barb. 645; Sullivan v. Collins, 18 Iowa 228; Crosby v. Wood, 6 N.Y. 369; Swaggard v. Hancock, 25 Mo.App. 596; Livingston v. Dugan, 20 Mo. 103; Long v. Towl, 42 Mo. 550; School v. Matherly, 90 Mo.App. 403. "Where goods or other property is in possession of one not the owner, who refuses to deliver such property to the owner unless the latter pays him a sum not rightfully due, and the owner in order to obtain possession of his property pays the unlawful exaction, a payment so made is in a legal sense under duress, and may be recovered back in a proper action; and especially is such the case where the wrongful detention is connected with circumstances of hardship or serious inconvenience to the owner." Bank v. Sargent, 59 L. R. A. 296 (note); Construction Co. v. Hayes, 191 Mo. 248; Wells v. Adams, 88 Mo.App. 215; Taudy v. Commission Co., 113 Mo.App. 490; Milkeeson v. Hood, 65 Mo.App. 491; Rowland v. Watson, 88 P. 495. To obtain a prior right a secondary assignee of a contract must show that he is an innocent purchaser for value, without notice of facts which would charge his conscience or put him on inquiry; neglect to make inquiry is sometimes equivalent to notice. If he is not an innocent purchaser he can not in good faith claim to be the owner. Pomeroy's Eq. Jur., 599-603-1047-1048; Pomeroy's Eq. Jur., 660-670; McLoran v. Monroe, 30 Mo. 462; Sensenderfer v. Kemp, 83 Mo. 581; Bailey v. Winn, 101 Mo. 649; Widecomb v. Childers, 47 Mo. 382; Handy v. Rice, 98 Me. 504; White v. Moores, 86 Me. 62; Waddington v. Lane, 202 Mo. 387; Ellis v. Homan, 90 N.Y. 473. An accord without satisfaction is void. Brown v. Spafford, 95 U.S. 484; Hearn v. Keel, 81 Am. Dec. 472 (notes); Beach on Contracts, p. 525; Frost v. Johnson, 8 Ohio 393. The contract between Enoch and Barber was a partnership contract. The sale of the property of the partnership by one partner necessary to carry on the business is void. Bates on Partnership, sec. 403; Coughton v. Forrest, 17 Mo. 131.

GRAVES J. Valliant, J., absent.

OPINION

GRAVES, J.

For some months prior to November 9, 1901, one John Enoch had been diligently engaged in trying to procure a franchise from Kansas City to construct and maintain a telephone system in said city. From the evidence it appears that the city had previously granted a franchise to what it thought was an independent concern, but nothing came from it, and the old telephone company continued to hold the field undisputed as to competition. It would appear that the purpose of the then Mayor was to secure competition in the telephone business in the city, and if possible to obviate what had been denominated "sell outs" in franchises granted. The Mayor had conceived the idea of requiring a deposit to be made by applicants for franchises, which deposit was to his mind the best evidence of good faith, and which deposit as he thought would tend to compel the applicant to accept the terms of the ordinance granting the franchise, and thus compel the building of a new telephone system in the city. It appears that Enoch had put up a guarantee of $ 1,000 and had succeeded in getting his ordinance through the lower branch of the Common Council. At this point the Mayor took a hand. Recalling past experiences and fearing that another "sell out" was apparent, he interested himself in opposition to the ordinance, and frankly told Enoch and his representatives his reasons therefor, which were as above indicated. The Mayor had the matter blocked in the upper house of the Common Council. Enoch, who lived at St. Charles, Missouri, was introduced to Charles B. Stark by a mutual acquaintance, Mr. Player, then a prominent official of the city of St. Louis. This was sometime prior to September 15, 1901. Enoch was trying to get parties interested so that he could get his franchise through the Common Council, and build the plant. Stark was a personal friend of the Mayor of Kansas City, and had a clientage in St. Louis among men of means, who could furnish the money with which to finance the deal. Stark went to Kansas City and had a talk with the Mayor and further proceeded to get together a syndicate of St. Louis capitalists to handle the proposition. Enoch frequently met Stark in St. Louis, and the result of it all was an agreement to organize a corporation to take over the franchise granted to Enoch. Mr. Stark and his associates incorporated the Peoples Telephone Company. At the suggestion of Enoch, Stark and his friends had first drawn up articles of association in the name of the Home Telephone Company, but when on December 24, 1901, he visited Jefferson City to obtain a charter, from the Secretary of State, it was found that a company under that name had been chartered and that Enoch was one of the incorporators. On December 21, Enoch had, by written assignment duly acknowledged, assigned his interest in the franchise to the Peoples Telephone Company. When Stark found the name Home Telephone Company already appropriated, he took out his charter by changing to the new name in the Secretary of State's office and further had the assignment of the franchise again re-executed by Enoch. Under this assignment Stark and his friends in St. Louis claimed title to the franchise which had been granted to Enoch. There was also an agreement between Enoch and Stark, as trustee for the syndicate of the same date, December 21, 1901. This agreement covered the details of the organization of the corporation.

Now going back to where we left off in the history of the ordinance. As stated the Mayor had blocked the passage of the ordinance. Early in November or on November 4th, the work of the Mayor brought fruition. Enoch got the Central Construction Company, a co-partnership composed of Ed. L. Barber, James S. Brailey and O. C. Snider, to put up a guaranty fund of $ 20,000 in order to secure the passage of said ordinance in the upper house of the Common Council. This money at the Mayor's suggestion was placed in the hands of three prominent citizens of Kansas City, who took and received it under written conditions signed by them thus:

"Received the 4th day of November, 1901, from John Enoch, the sum of twenty thousand dollars, upon the following terms and conditions, to wit:

"Whereas there is now pending before the upper house of the Common Council of Kansas City, Missouri, an ordinance entitled 'An ordinance granting for a term of thirty years to John Enoch his successors and assigns, the right, privilege and authority to construct, lay and maintain and operate in Kansas City, Missouri, and through the public...