Koontz v. Kaufman

Philips, P. J. I. The first question, in order, for determination is, as to the admissibility in evidence of the record in the suit of O’ Bryan vs. Koontz. The gravamen (A plaintiff’s complaint is, that by reason of defendants ’ false and fraudulent representations respecting the ownership of the property he was induced to release the same from his levy, whereby he was subjected to damage. As his loss was consequent upon that judgment, it was competent to plead and put in evidence that record to prove the judgment, and its satisfaction. Freeman on Judg. 416, 417; Walker v. Deaver, 79 Mo. 678; Blasdale v. Babcock, 1 Johns. 517. It being admissible for one purpose, it was proper not to exclude if on a general objection to its entire competency. The proper practice, where the evidence offered is competent for a certain purpose, but incompetent for others for which it might be misused before the jury, is to limit and qualify its proper application by instructions to the jury. Babb v. Ellis, 76 Mo. 460; Schlicker v. Gordon, 19 Mo. App. 479. II. The further question arises, did the court err in giving or refusing instructions respecting the effect or office of said judgment ? On the part of the defendants the court refused to direct the jury, that in determining — 409 — the ownership of the property in question, they should not regard the verdict or judgment in O’Bryan vs. Koontz. This presented the question broadly as to whether said judgment was conclusive on the matter of such ownership. It was either an estoppel or it was not. If the judgment was not conclusive, as to this issue, it was no evidence at all. There was no half-way ground ; and the defendants were entitled to have the jury properly advised as to the effect of this record admitted in evidence by the court over their objection. It is difficult to say from the first instruction given for plaintiff what effect was intended to be given to the judgment. It is submitted in connection with various other facts, leaving the jury to draw their own inference as to what importance they would attach to the recovery in O’Bryan vs\ Koontz. They might or they might not have concluded that the judgment was conclusive on defendants as to the ownership of the property in question. And so we must hold to sustain this judgment. It is a fundamental rule of the doctrine of res judicata that judgments in personam conclude only parties to the record and their privies. They cannot be invoked by strangers. Big. Estop. 59; Quigley v. Bank, 80 Mo. 290. These defendants were not parties of record in that action. Were they privies in contemplation of law % In its strict sense, privies are those who have mutual or successive relationship to the same rights of property, or subject-matter, suchas “personal representatives, heirs, devisees, legatees, assignees, voluntary grantees, or judgment creditors, or purchasers from them with notice of the facts.” Henry v. Woods, 77 Mo. 281. As these defendants assert title and ownership anterior to the judgment, they are not bound as privies thereunder, in the ordinary sense ; for “no one is a privy to a judgment whose succession to the rights of property thereby affected occurred previous to the institution of the suit.” Freeman on Judg., sec. 162; Henry v. Woods, supra. The doctrine as to parties has been extended so as to — 410 — apply to a person, though not nominally a party to the record, yet who has assumed such relation to the litigation as to be treated as a party in interest, so as to be bound by the result. Illustrations of this exception are to be found in instances of a party employing attorneys to conduct the cause, furnishing witnesses, controlling and managing the suit at trial, and becoming responsible for costs, and the like. Stoddard v. Thompson, 31 Ia. 80; Strong v. Ins. Co., 62 Mo. 289; Wood v. Ensel, 63 Mo. 193; Landis v. Hamilton, 77 Mo. 555. In Strong v. Ins. Co., the rule was applied to the instance of a judgment against an original insurer, who contested the suit, with the advice or acquiescence, and for the benefit of, the reinsurer. The ruling was predicated of the principle that, “ Where one is bound to protect another from liability, he is bound by the result of a litigation to which such other is a party, provided he had notice of the litigation, and opportunity to control and manage it.” The principle was later applied by the Supreme Court in Wood v. Ensel, supra. In that case there had been a litigation and judgment between one Balke and Swift concerning the title of a billiard-table. In the present suit the defendant claimed that he was the mere bailee of said Balke; and the record of that judgment between Balke and Swift was admitted in evidence against plaintiff. The court said : ‘ ‘ It was quite sufficient that the testimony of the plaintiff himself showed that he was an active participant in the former trial respecting the same subject-matter, claimed the property in dispute as his own, appeared as a witness in the case, and in the absence of Swift (who claimed to hold only as plaintiff’s bailee) assumed control of the case, and employed and paid attorneys to defend and attend to it. These facts bring the plaintiff clearly within the definition of a party to the action he thus defends.” • The facts of the case at bar fall far short of these requirements as to one who assumes to control the litigation. The evidence in this case only shows that one — 411 — of the defendants gave Koontz, at his request, the names of two witnesses to call. The defendants appeared and testified for Koontz, under subpoena. The plaintiff himself testified: “I don’t remember that they did anything at the trial but testify. ” They did not employ counsel in the case, nor assume to control and manage the case. Merely appearing and testifying in the case was not sufficient to bind them, nor even secretly employing counsel, had they done so. Schroeder v. Larhman, 26 Minn. 87; Blackwoood v. Brown, 32 Mich. 107; Wright v. Andrews, 130 Mass. 149; Wells Res Adj., sec. 175. The case of Yorks v. Steele, 50 Barb. 397, so often cited both by courts and text-writers, is a decided authority against the defendants being bound by said judgment, as to the ownership of the property, on the ground of their participation at the trial. One Pond obtained judgment against the plaintiff Yorks, and, under execution issued thereon, one Chase, as sheriff, levied on a horse in the possession of the defendant Steele as the property of Pond. Steele brought suit against Chase. On the trial of that issue, Yorks employed an attorney for the sheriff, and himself testified in the case. Steele recovered judgment, on the ground that the horse was not subject to the execution against Yorks. In the action then brought by Yorks against Steele to recover this horse, Steele was permitted to put in evidence the record of said judgment in Steele vs. Chase, and plaintiff took a nonsuit. The court held the judgment inadmissible. Johnson, J., said: “It is of no consequence, prima facie, that the plaintiff was a witness for the defendant in the action brought by this defendant. He had no right, as a witness, to examine or cross-examine other witnesses, or to call other witnesses, who might have a better knowledge of the facts than himself. In short, as a mere witness, he had no charge or control of the case whatever. And supposing that judgment was erroneous, for any reason, he had no right of appeal and no standing by which he — 412 — could be heard to correct the error. Why, then, should he be bound by the adjudication? It was not a judgment against him, in any sense, nor upon any right or interest which would subject him to an action for recovery over, as in case of a failure of title upon the sale of chattels. * * * It is plain that the plaintiff has never yet had his day in court on the question of his title. There is nothing which proves, or tends to prove, that the present plaintiff defended, or had any right to defend, the former action. They were not in privity as master and servant, or principal and agent. The plaintiff here was under no obligation, moral or legal, to defend the sheriff in that action, and had no legal right to do so, or even to interfere with it in any way whatever. Not being a party to the record, he is not estopped by the judgment, unless, in the language of Comstock, J., in Castle v. Noyes, 14 N. Y. 329, 332, he had a right to control the proceedings and appeal from the judgment.” There is no pretense here that these defendants sought to control or manage the action of O’ Bryan vs. Koontz. The plaintiff himself testified that immediately after that trial he asked one of the defendants to help him out, and the reply was : “You and O’Bryan will have to fight it out.” Yet .plaintiff appealed the case to the Supreme Court, where he was unsuccessful, making more costs, which he asserted in his testimony the right to recover from these defendants ; and it is inferable, from the testimony and the amount of the judgment recovered herein, that he was allowed such costs by the jury. No exception, however, was taken to this evidence. III. If, therefore, that judgment concluded the defendants on the question of own ership of the property, it must be on the only remaining rule, that, where a party is answerable over to another for the subject-matter of the judgment, he is bound by such judgment, when he has been notified of the pendency of the litigation, and had an opportunity to defend the action. This arises — 413 — usually from some contractual relation between the parties, as in the case of the reinsurance in Strong v. Ins. Co., supra, of indemnitors, warrantors, and the like. That is not this case. This action, under the petition, is ex delicto, predicated of the fraud, the wrong, and the falsehood of the defendants. It is in the nature of an action of deceit and fraud. And, although the plaintiff in his first instruction predicated a right of recovery on the fact, in part, that defendants told plaintiff if he released the property they would protect him, or some such representation, this was outside of the allegations of the petition, and should not have been given. Benson v. Railroad, 78 Mo. 504; White v. Chaney, 20 Mo. App. 390. If such assurance was affirmatively given by defendants, the plaintiff should have counted on the promise, and the doctrine of respondeat superior, invoked by plaintiff, would have then arisen on the contractual relation. But such is not this action. On this petition the plaintiff must prove the fraud, or the state of facts from which the fraud and deceit arise in law. Arthur v. Man. Co., 12 Mo. App. 335. It follows that if the judgment was binding on the defendants, it must rest upon the further rule, that the defendants are answerable over by operation of law, which is akin to the doctrine of respondeat superior. This has been applied to the instance of one who places obstructions, or commits some nuisance, in the streets of a town, whereby a person receives injury. The town being primarily liable to the injured party, if mulcted in damages at the suit of the sufferer, has a cause of action over against the wrong-doer whose immediate act caused the injury. In such case, if the municipal corporation when sued gives notice to the wrong-doer of the pendency of the suit, he will be bound by the verdict and judgment therein rendered, as to the fact that the highway was defective, that the person was injured, and the amount of the injury. Wells Res. Judicata, sec. 193; Littleton v. Richardson, 34 N. H. 187; Chicago v. Robbins, 2 Black, 418. This doctrine, or rule, has also — 414 — been applied to the instance of an action arising, as in this case, ex delicto, for fraud and deceit, whereby the wrong-doer was answerable over to the party-sustaining a loss by reason of such misrepresentation. This was notably so in the case of Barney v. Dewy, 13 Johns. 224, where the plaintiff was induced to buy a horse of the defendant on his fraudulent representations as to ownership. In an action of trover brought by the true owner against plaintiff the defendant appeared as a witness for the plaintiff and testified that the plaintiff owned the horse, and j udgment went for the claimant. In the subsequent action for damages against the defendant instituted by the plaintiff, his vendee, the plaintiff introduced in evidence the record of that judgment. It was held to be admissible in evidence, and conclusive against the defendant. Our conclusion, therefore, is that the court did not err in refusing the sixth instruction asked by defendants. IY. Appellants further contend that the court erred in refusing the fifth declaration of law asked by defendants. There is no question in my mind but that, in view of the defendants’ evidence, they were entitled to an instruction to the effect that, if defendants only made separate claims to separate portions of the property, and separately represented to plaintiff that he claimed such portion, a joint action would not lb*, without further proof of a prior combination between them thus to mislead and deceive the plaintiff. But the misfortune to defendants’ contention is, that the instruction as framed did not clearly enough express such idea. It is: “If the jury believe, from the evidence, that the defendants each claimed a separate portion of the property, and that they separately notified Koontz in writing of their said claims.” This could all be true, that each claimed a certain portion, and so notified Koontz, and yet the fact remain, as testified to by plaintiff, that they made these statements in each other’s presence, that the other also owned the part he claimed. The — 415 — instruction, as asked, ignored this aspect of the plaintiff’s evidence, and told the jury that if each claimed a separate portion, without more, they should find for defendants unless they found the existence of the antecedent fraudulent combination or conspiracy. There may have been no prior fraudulent combination between the defendants to thus make claim to separate portions of the property, so as to cover the whole, yet, if in fact, when they were together in the plaintiff’s presence, they falsely and fraudulently asserted that they were the owners of the property as each claimed it, and that the other owned the portion claimed by him, it was sufficient to base the joint action upon the falsehood, if the proof was such as to evince the fraudulent intent. The evil intent could arise at the instant. Burgert v. Borchert, 59 Mo. 83. V. The court erred, however, in refusing the second instruction asked by defendants, and in giving the second instruction for plaintiff. As already stated the gist of this action is the fraud and deceit of defendants in claiming to own the property. The allegations of the petition are that said representations “were false and fraudulent, and known to said defendants at the time so to be false. and fraudulent; that said false and fraudulent statements were knowingly made by said defendants, for the purpose of inducing plaintiff to release said property.” These were essential averments, of facts constitutive of the cause of action, well known to the intelligent pleader, without which the petition would have invited a demurrer. The gravamen of the action is the false statement made with intent to mislead, followed by damage. Medbury v. Watson, 6 Met. 259; Barney v. Dewey, 13 Johns. 226; Arthur v. Man. Co., 12 Mo. App. 335. “It seems to be established that an action based upon the deceit or fraudulent representations of another cannot be maintained in the absence of proof that the party making them* believed or had good reason to believe at the time he made them that they were false, or that he assumed or intended to convey the impression that — 416 — lie had actual knowledge of their truth, though conscious that he had no such knowledge.” Dulaney v. Rogers, 64 Mo. 203. There must be proof of the scienter. Were the law otherwise, it would be that any person who made claim to property seized on process, however honest and sincere he might be in the belief and conviction that he owned it, and however free from any design to defraud or wrong the other claimant, would be liable in this form of action where the officer released it on the faith of such asserted ownership. In short, it would make such claim in pais operate as an interpleader in the cause. It would make every judgment between the execution or attaching creditor and the officer, or other party concerned, res adjudicóla against the party so presenting his claim to the officer, regardless of the question of being answerable over for the fraud in asserting the claim. While the question as to Charles Kaufman’s ownership of the property has been adjudicated, the other question, as to whether the representations and statements by defendants to Koontz were made in good faith or fraudulently, remains at issue, with the burden of proof on the plaintiff. That issue of fact was not properly submitted to the jury, and there has been no finding thereon. The case must, therefore, be retried. The judgment is reversed and the cause remanded. Ellison, J., concurs; Hall, J., non-concurs.