Morawick v. Martineck's Guardian

. Opinion of the Court by Judge Carroll Affirming. On February 17,1905, Julius Martineck. died estate in Jefferson- county. He nominated the appellant — 160 — Morawiclc as executor of his will, and in this action, brought by the executor to settle the estate, the only child of Julius Martineck by her guardian filed an answer and counterclaims, in which she charged that the testator at the time of his death owned five Louisville & Nashville Railroad bonds known as “L. & N. collateral trust,” each of the par value of $1,000, and worth that sum at the time of the testator’s-death. She averred that the executor had failed to charge himself with or account- for any of these bonds, and’ had wrongfully converted them, to his own use; and sought to hold him liable for the amount of them. The executor answered, denying that these bonds or. any of them, had come into his possession, or that' he had! any knowledge or information that tlxe testator at the time of his death owned them. Upon the issue thus presented; on motion of the guardian of the infant, an issue out of chancery was directed'upon this point, and the chancellor transfered the case to the law division of the Jefferson circuit couid. presided over by Judge Gordon,'where upon a trial before a jury a verdict was returned against appellant. No complaint is made of the instructions, whicli simply directed the jury to find the fact in controversy, but it is earnestly insisted that the verdict is wholly unsupported by the evidence, and that other errors that will be noticed in the course of the opinion were committed by Judge Gordon to the prejudice of appellant. For appellee it is contended that the verdict of the jury is to be treated as would be the verdict of a properly instructed jury in a common-law action, and will not be disturbed unless it is flagrantly against the evidence. ' For appellant it is insisted that an issue of fact was merely submitted — 161 — to the jury by the chancellor to get the aid of their opinion in its disposition, and that their finding does not hav.e the effect of a verdict in a common-law action, but is only advisory, and the chancellor may or not in his discretion, after considering for himself the case, feel bound by it; that, without-regard to the verdict he had the right to exercise his independent judgment and dispose of the case as he thought proper. It is very difficult to draw distinctly the line between that class of cases in which a party to an action properly brought and pending on the equity side of the docket is entitled as a matter of right to 'demand that the controverted issues of fact shall be submittéd to a jury and that class of eases in which it is wholly within the discretion of the chancellor whether he will or not call to his assistance the aid of a jury; and, as it is not necessary-in disposing of the .matter before us to make the classification, we will not attempt it further than to say that in this action the defendant, now appellee, was entitled to demand a jury trial on the issue presented by the answer and counterclaim. The only matter in controversy between the parties was whether or not appellant had wrongfully converted to his own use specific personal property to which appellee was entitled.- This was purely a legal issue. The action, if one had been brought to recover this property, would properly belong on the ordinary or common-law side of the docket. The fact that the cause of action was asserted in a counterclaim, in an equitable action did not.deprive appellee of his right-to a jury trial. At common-law-the action-would have been in trover. Chitty’s Pleading, p. 164.. It has none of the elements of an equitable proceeding, and it would have been error not. .to have, granted-appellee’s re — 162 — quest for a jury trial. Our Code of Practice recoge nizes the right to have legal issues in equitable actions disposed of by a jury. Section 10 of the Civil Code of Practice, provides in part that “the defendant by motion made when he answers may have an equitable action transferred to the ordinary docket * * * if the answer presents a defense of which he is entitled to a jury trial.” Section 11: “If there be an issue which was not cognizable in chancery, and an issue which was exclusively cognizable in chancery * * * the plaintiff may have the former issue tried before the latter is disposed of.” Section 12: “In an equitable action, properly commenced, as such, either party may, by motion, have the case transferred to the ordinary docket for the trial of any issue concerning which he is entitled to a jury trial; but either party may require every equitable issue to be disposed' of before such transfer.” It will be observed that the Code does not declare what weight shall be attached to the verdict of the jury if an issue out of chancery or a distinct legal issue in an equitable action is submitted for their decision, but it has been ruled by this court that: “In a case of purely equitable cognizance, the chancellor has the discretionary power to direct an issue of fact to be tried by a jury; and their verdict is, generally speaking, treated by the chancellor as conclusive between the parties, but it is not necessarily conclusive, for the reason that the chancellor simply seeks the advice of the jury to aid him in coming to a correct conclusion on a mooted question of fact. But this principle does not apply where there is a distinct legal issue made in an equitable action; for the reason that the twelfth section of the Code gives either party the right to have such issue tried by a jury, and their verdict, as — 163 — in ordinary jury trials, is conclusive between the parties, unless the court, upon a motion for a new trial, is satisfied that it is palpably against the weight of evidence.” Hill v. Phillips, 87 Ky. 169, 7 S. W. 917, 10 Ky. Law Rep. 31. This general statement of the weight that will be attached to the verdict of a jury when an issue out of chancery on a distinct legal issue in an equitable action is submitted for their consideration, although it does not undertake to classify the cases in which a party is entitled to a jury trial as a matter of right from those in which the chancellor may or not in his discretion seek the advice of the jury, has been generally followed in the practice, and it may be accepted as the rule that will be applied by this court when questions of this character arise; and it may also be considered as settled that when the chancellor in the exercise of his discretion submits an issue to a jury, the submission of which a party cannot demand as a matter of right, that the verdict is not binding upon the chancellor. We do not mean to say that the verdict of a jury in any case is binding upon the chancellor or the court, as the court in any case tried before it has the power to set aside the verdict, although in unmistakably common-law actions, or in respect to a distinctly legal issue submitted in an equitable action, the court might be more reluctant to disturb the finding of a jury than would the chancellor if the jury merely considered an issue of fact submitted to them by him in an equitable action. As illustrative' of the practice, and supporting the rule announced in Hill v. Phillips, we do not deem it necessary , to do more than cite the cases of Wisdom v. Nichols-Shepherd Co., 97 S. W. 18, 29 Ky. Law Rep. 1128; McElwain v. Russell, 12 S. W. 777, 11 — 164 — Ky. Law Rep. 649; Ford v. Ellis, 56 S. W. 512, 21 Ky. Law Rep. 1837; Reese v. Youtsey, 113 Ky. 839, 24 Ky. Law Rep. 603, 69 S. W. 708; Jones v. Woods, 70 S. W. 45, 24 Ky. Law Rep. 840; Bush v. Eastern Kentucky Timber & Lumber Co., 90 S. W. 547, 28 Ky. Law Rep. 773; Baxter v. Knox, 31 S. W. 284, 17 Ky. Law Rep. 489. Under our view of tbe law and practice applicable' to this case and controlled by tbe rule so uniformily applied by the court in considering the verdict of a properly instructed jury in a common-law action, we could not set aside the Verdict unless it was flagrantly against the evidence; but, if' we should accept the views of counsel for appellant and treating this case as if the issue" referred to the jury was one that the chancellor might in his discretion have disposed of without a reference, the question would remain:- What weight shall be attached to the finding of the jury? That the judgment of 12 unbiased jurors upon a controverted question of fact is entitled to great consideration goes without saying; and although the chancellor might disregard their finding, he would not do so lightly, or unless fully satisfied that injustice had been done. This thought is well stated in Lee v. Beatty, 8 Dana, 204, where the court said: “If, however, the judge shall, after a finding' by the jury impaneled in such a casé, and for such a purpose, be well satisfied- that the facts did not authorize the verdict, or preponderated decidedly against it, he would have the unquestionable right to disregard the finding by the jury, and render such a decree as he should have done'in the first instance, without the aid of an inquisition. But if, as we should presume would generally be the case when a jury has been properly ordered, the judge should after the finding, as before, consider the facts — 165 — as being equiponderant or very nearly so, he should not disregard the verdict, but should render such a decree as would be proper in a case tried by a jury in a court of law. The verdict should be entitled to some influence, and should at least be respected as the opinion of 12 intelligent and impartial men upon doubtful facts which they were peculiarly qualified to determine, and were therefore summoned to determine.” In 2 Encyclopedia of Pleading & Practice, p. 705, the practice supported by ample authority is thus stated: “Though the verdict of a jury is not binding on the court, yet it is entitled to much weight and respect, and will ordinarily be adopted as the basis of its final decision if the court is satisfied that at the trial justice has upon the whole been substantially done.” In 16 Cye. 423-425, it is said: “In a chancery case, where the right to a jury trial is not expressly given by statute, the verdict of the jury on issues submitted to them is in most jurisdictions merely advisory, and not binding upon the chancery court. * * * Nevertheless, where the issues have been properly submitted to the jury, and they are material, if the trial appears to have been a fair one, and'the parties have introduced all their' evidence on the issues, the verdict of the jury is entitled to much weight, and ought not to be lightly disregarded. * * * The chancery court will rarely set aside a verdict when the judge before whom the issue is tried certifies that he is satisfied with the verdict, and that it ought to be regarded as conclusive on the question submitted to the jury.” Judge Gordon, before whom the case was tried, in overruling the motion for a new trial, said: “Nothing short of a direct or controlling authority from the Court of Appeals could require me to certify to the chancellor'a verdict which — 166 — in my opinion was returned without a scintilla of evidence to support it, or was flagrantly against the weight of the evidence, or was rendered upon incompetent evidence. I am of the opinion that the verdict is not flagrantly. against the weight of the evidence.” The chancellor to whom the matter was referred after the trial of the issue also declined to disturb the verdict. So that the appellant is in the position of asking this court to set aside the verdict of a jury upon a controverted question of fact when that verdict has been approved by the common-law judge who tried the case, as well as the chancellor who finally disposed of it. This we do not feel disposed to do, unless the. contention of appellant that substantial error to his prejudice was committed in the trial of the issue before Judge Gordon is sustained. Entertaining this view, it will not be necessary .to state'elaborately the evidence or to express an opinion concerning its weight, other than to say that in our opinion from an independent consideration of the record it is sufficient to sustain the verdict. We will therefore proceed to consider the particular errors relied on, viz., that the court erred in refusing to permit some witnesses who were present to testify orally in place of permitting their depositions that had been previously taken to be read; and, second, in admitting incompetent evidence. Before the case was transferred to the common-law court, the depositions of the appellant, as well as a number of other witnesses, had been taken. During the progress of the .trial the appellee, who was defendant below, offered to read in evidence the deposition of appellant, thereupon counsel for appellant objected to the deposition being read and offered appellant as a witness to testify orally in the case. — 167 — His objection was overruled, and the deposition read. The same action was taken in respect to the evidence of Anna Rose Cooney and Eugene Cooney, whose depositions were read as evidence in behalf of appellee. Setting aside for the present the question as to whether this ruling of the court was prejudicial to appellant, we will consider what is the proper practice in matters of this kind. Section 552 of the Civil Code of Practice provides: “Depositions, or certified copies thereof if they be lost, may be used upon the trial of any issue of fact in an equitable action, unless such issue be transferred pursuant to title two.,r Under title two are the sections heretofore quoted, authorizing the trial by a jury of legal issues made in an -equitable action. Giving to this section of the Code its fair meaning, our opinion is that, where an issue of fact in an equitable action is submitted to a jury, the proper practice is to allow the parties to introduce witnesses in support of their respective contentions for oral examination before the jury, if the witnesses are present and they are offered in person to testify. There appéars to be no good reason why the jury should not hear the witnesses testify orally in this class of cases, as well as in the ordinary common-law actions. Indeed, the same reasons exist why the jury should hear the witness testify in person as exists in any other jury trial. These reasons have been so often presented and are so well known to the profession that it is not necessary here to mention them. In Talbott v. Bedford, 53 S. W. 294, 21 Ky. Law Rep. 898, which was a suit in equity that had been prepared for trial before the chancellor, the court upon the trial before a jury only allowed two witnesses on a side to testify- orally; the other evidence being heard by deposition. This court, without — 168 — passing directly upon the question here presented, contented, itself by saying that, “in allowing two witnesses to testify orally and requiring all the.other proof to be made by depositions', we are unable to say that any injustice was done either party,” In Small v. Reeves, 59 S. W. 752, 22 Ky. Law Rep. 1051, the evidence had been taken almost entirely, by deposition, and the lower court in submitting the issue to the jury,.prescribed.that the plaintiff’s depostitions theretofore taken should constitute his. evidence in.chief on the trial, with the exception that the plaintiff might be examined orally before the jury, an.d that the plaintiff might introduce oral evidence in rebuttal, and that the defendants should be confined in the introduction of their evidence.to the depositions • theretofore taken in their behalf, except that they might introduce testimony in rebuttal. The plaintiff excepted to so much of the order as. limited the introduction-of oral testimony, and this alleged error on the part of the circuit judge was the chief error relied- on for reversal. . In disposing of it, this •court said: “This suit was brought -in equity and an immense amount of evidence was taken by deposition before there was any motion for a jury trial. It is prosecuted by appellant in forma pauperis, and upon the return of the case after the reversal by this court, it was not an abuse of discretion on the part of the circuit judge to require appellants to read to the jury .the depositions which.had been taken at a great expense, as testimony in the ease. The .right of the circuit judge to so regulate the form of the evidence and the order of its introduction is we. think abundantly sustained by the. cases [citing them]. Besides, it is not apparent that appellant.was prejudiced by the refusal of the court to permit .the oral examina — 169 — tion of the one witness besides himself who offered to testify. There was no avowal as to what this witness would prove, and his deposition, taken at great length, was read to the jury, and the plaintiff thus got full benefit of his testimony.” In McMakin v. Stratton, 82 Ky. 226, 8 Ky. Law Rep. 766, in discussing a similar question, the court said:' “The question was submitted to the jury on that issue, as directed by the chancellor, and, when tried, the judgment was for the appellee. Oral testimony was heard on the trial, and the objection that it should’ have gone to the jury in the form of a deposition is unavailing. The ancient chancery practice permitted the introduction of this character of testimony — at least such* has been the practice is this State. * * * Subsection 2 of section 552, when treating on the issues of fact in equitable actions, provides that the court may require oral testimony upon a trial by jury.” These are the only cases that have come under our notice that have been decided under the present Code. Code 1854, section 613, provided: “Depositions may be used on the trial of all issues and upon all motions in actions by equitable proceedings except where the court otherwise directs on an issue tried by a jury.” The difference between that section and section 552 of the present Code is apparent. Under the old Code the practice was to use depositions entirely, unless otherwise directed by the court. Under this Code depositions are to be used, unless the issue is transferred to a jury for hearing. There is an apparent conflict between the cases cited construing' section 552, but the proper practice is to allow the parties to introduce oral evidence, and, if it should appear that the failure to allow this to be done had worked substantial prejudice to the rights of the party making — 170 — the offer, it would constitute reversible error. The record does not disclose what advantage or benefit appellant could have derived from being allowed to testify orally — in fact, he did so testify in rebuttal— and it does not appear that, he could have made out for himself in any respect a stronger or better case than he did in his deposition, and we are unable to perceive in what manner his rights were prejudiced by the failure of the lower court to permit him to testify orally, nor do we discover anything in the record that would lead us to the conclusion that his rights were affected by the refusal of the lower court to permit Mrs. Cooney and Eugene Cooney to testify in person. It is earnestly contended that serious error was committed in allowing evidence touching the efforts of appellant to sell the decedent property located at Tel! City, Ind. T'o understand the pertinency of this evidence, a brief summary of a few of the salient facts and circumstances developed in the case will be necessary. In the summer of 1904 Martineck, influenced largely by the advice of appellant, sold property owned by him in Louisville and in which he conducted a saloon. The proceeds of this property, together with other estate owned by Martineck, amounted to between $8,000 and $9,000. After making his will, and disposing of this property, Martineck by the advice of appellant invested $6,000 in Louisville & Nashville bonds, and placed these bonds in a safety vault in the National Bank of Louisville; but he afterwards disposed of one of them. That appellant knew Martineck had purchased these bonds, and was also fully acquainted with the value of his estate, the evidence leaves no room to doubt. He further knew that Martineck was an unusually close, — 171 — economical, thrifty man, and that, as he had the bonds a few months before his death, it was reasonably certain that he had them when he died. Bnt, when he qualified as executor under the will, a few days after the death of Martineck, and went before the county judge for the purpose of probating it, he informed the judge that his estate amounted to between $2,000 and $3,000, which was approximately the correct value of it excluding the bonds. Nor did appellant at any time manifest the slightest interest or concern about these bonds, or express any opinion or surprise that they could not be found, or concerning the smallness of the testator’s estate, although it would seem to havd been his duty, in view of the fact that he knew a few months before the testator died that he had these bonds, to have taken some interest or at least manifested some curiosity as to what had become of them, but he did neither. On the contrary, he ignored their existence entirely, and proceeded to settle the estate as if Martineck had never owned any bonds of their equivalent. When the guardian of the infant undertook to charge ap>pellant with the value of these bonds, it was, of course, indispensable that it should be shown that Martineck had the bonds, and that appellant knew it or at least knew that he had money or its equivalent amounting to between $8,000 and $9,000. In the development of these two facts so necessary to a •recovery, appellees were permitted to prove that a few weeks preceding the death of Martineck appellant made a strenuous effort to sell him property in Tell City, Ind., for $8,000 or $9,000. This evidence in connection, with the other facts in the case was competent for the purpose of establishing that at this time appellant knew that Martineck was worth — 172 — between $8,000 and $9,000. In the admission of this competent evidence, for the purpose mentioned and in connection with it, there was some incompetent evidence permitted to go before the jury; but this technically inadmissible evidence was so intimately connected with that which was competent that it was difficult to separate with precision the wheat from the chaff, and to draw with accuracy the line between that which was competent and relevant and that which was not. Whatever of the evidence upon this point that was not competent cannot be said to have been prejudicial, in view of the fact that it merely brought out more strongly appellant’s knowledge of the value of Martineck’s estate. The evidence in this case is wholly circumstantial. There is no direct evidence connecting appellant with the conversion of these bonds, and yet there are many circumstances, each in itself inconclusive, that, when added together, leave the impression that the verdict of the jury finding that he converted them was not without sufficient evidence to sustain it.- In the trial of cases of this character greater latitude must necessarily be allowed in the examination of witnesses than when the facts are susceptible of direct or positive proof. When it is sought to make out a meritorious case by circumstantial evidence to the end .that justice may be done and the rights of innocent people protected, the trial judge may, with great propriety, admit to the jury every relevant circumstance that tends to throw light upon the situation, and may with equal propriety allow the examination of witnesses to take a range sufficient to embrace within its reach every pertinent circumstance that will aid the jury in arriving at a just conclusion. In view of the fact that able counsel on both sides — 173 — of this case have manifested great ability and industry in bringing to our attention every important feature of it, and because in its various aspects it is full of interest, we have given to it a most careful consideration, and our conclusion is that the verdict-of the jury, although rested upon circumstántial evidence, is correct. We are asked by appellee to review the judgment of the chancellor allowing appellant commissions and only charging him with 4 per cent, interest upon her money, but we are not inclined to grant this request. Wherefore the judgment is affirmed on the original and cross-appeals. Petition for rehearing by appellant overruled.