Case Title: Wenzel MacHinery Rental & Sales Co. v. Adkins

Citation: 189 Kan. 435, 370 P.2d 141

Docket Number: 42,466

State: kansas

Court: Kansas Supreme Court

Date: 1962-04-07T00:00:00Z

Document:
189 Kan. 435 (1962)
370 P.2d 141
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. 42,466

Supreme Court of Kansas.
Opinion filed April 7, 1962.
Robert T. Cornwell, of Wichita, argued the cause, and 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, all of Wichita, were with him on the briefs, and Homer V. Gooing and Hugo T. Wedell, both of Wichita, of counsel.
Elvin D. Perkins, of Emporia, argued the cause, and Everett D. Steerman, of Emporia, was with him on the briefs for the appellee Adkins.
James D. Howell, James D. Howell, Jr., William E. Scott, Francis J. Donnelly, and LaVone A. Daily, all of Kansas City, were on the briefs for appellee Rieke.
The opinion of the court was delivered by
PARKER, C.J.:
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 *436 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:
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 *437 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,
and then, at page 13 of such brief, states the question involved is:
Appellees, in their joint brief, make the following statement:
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. *438 Jur., Joint Adventures, § 4, p. 940; 48 C.J.S., Joint Adventures, §§ 1[6], 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:
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, as 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 non-signing 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 *439 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 and deciding a question of law which is not fortified by the factual situation presented by the record in the case.
Moreover, it is to be noted that in Plains State Bank v. Ellis, supra, we recognized that, notwithstanding the provisions of 52-218, supra, a suit may be maintained on a promissory note against an undisclosed principal under conditions and circumstances similar to those involved in the instant appeal when, at page 656 of the opinion, we said:
Not to be out done appellant cites John Deere Plow Co. v. Klaurens, 153 Kan. 151, 152, 109 P.2d 98, and in its brief, as well as its oral argument, insists that the factual situation in that case is so similar that if the case is adhered to it must be considered as a precedent compelling a conclusion the trial court erred in its rulings. The case is identical from the standpoint of the general type of signature appearing on four notes in question but there similarity ends. The trouble from appellees' standpoint is that resort to the abstracts and briefs of the parties on file in the State Library, as well as this court's opinion, discloses questions relating to application of 52-218, supra, were never raised or discussed, either in the court below or in this court on appeal. It appears that under those circumstances this court determined the appeal on the basis of the issues involved below, winding up by affirming the lower court's judgment allowing recovery on the notes on the basis of a prior contract between the parties which created an estoppel. In any event, a careful review of the record makes it clearly appear appellant's claim John Deere Plow Co. v. Klaurens, supra, is to be here regarded as a controlling precedent lacks merit and cannot be upheld.
Indeed we are cited to and our extended research discloses no Kansas decisions controlling the question now under consideration. *440 Therefore we turn to other authorities which deal with the subject.
The question now before us  as heretofore stated  was squarely raised and answered in the negative in Frazier v. Cottrell, 82 Or. 614, 162 Pac. 834. In that case, which we believe should be regarded as a precedent controlling its answer in the case at bar, with pertinent statutes identical and similar confronting facts and circumstances the Oregon Supreme Court held:
And in the opinion said:
For other decisions of like import, supporting the principles of *441 law announced in Frazier v. Cottrell, supra, and our conclusion as to its status as a controlling precedent, where similar questions were raised with respect to the force and effect to be given a statute containing the same language as 52-218, supra, see Deichmann v. Aronoff (Mo. Ct. of App.), 296 S.W.2d 171, 178; Barnett Bank v. Chiatovich, 48 Nev. 319, 343, 232 Pac. 206; Commerce Trust Co. v. McMechen (Mo. Ct. of App.), 220 S.W. 1019, 1020.
See, also, Lady v. Thomas, 38 Cal. App. (2d) 688, 689, 102 P.2d 396; First State Bank of Riesel v. Dyer (Tex. Civ. App.), 248 S.W.2d 785, 788, where the principles of law adhered to in the foregoing cases are expressly recognized and approved.
For a well-recognized legal treatise see Britton on Bills & Notes (2 ed.) § 168, pp. 499, 500, which reads:
For other well-established legal treatises containing general statements supporting the legal principles announced and adhered to in the foregoing decisions  and our own conclusion that 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 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  see 7 Am. Jur., Bills & Notes, § 200, p. 903; 10 C.J.S., Bills & Notes, § 34[b], p. 455.
Other decisions dealing with the same general subject are cited in Plains State Bank v. Ellis, supra, at page 657.
The foregoing authorities, and what has been heretofore stated and held, compel a conclusion the trial court erred in holding the allegations contained in the petition as amended were not sufficient to constitute a cause of action in favor of the plaintiff and against the defendant Adkins on the note sued on. It follows that its rulings sustaining defendant Rieke's motion to dismiss and defendant Adkins' demurrer, each of which was based on the premise the amendment to the petition failed to state a cause of action against Adkins, *442 were likewise erroneous and cannot be upheld. Therefore such rulings must be reversed and the cause remanded to the district court with directions to set them aside.
It is so ordered.