perintendent, he also turned in $10 in cashing due on the first premium. Upon being as the amount collected on same. This was notified of Yount's death, the defendant tenin accordance with the rules of the company dered to plaintiff the $10 in gold, and, denyand the terms of his contract of employment. ing all liability, refused to furnish blanks The receipt given by Garnett to Yount was for proof of death. as follows:

Mr. Yount was examined by the defendant's local medical examiner on January 26, 1914, and this report, constituting a part of the application, and the whole showing applicant to be in good health, was sent to the home office of the company in Newark, N. J., on the same day. On January 30, 1914, the home office approved the application and made out the kind of policy applied for, and mailed it to the local office of the defendant, mailed it to the local office of the defendant, from whence the application had been received. Pinned on the face of the policy when it was sent out was a red slip bearing

these words:

"Important.

"This policy must not be delivered unless the applicant is in a satisfactory condition of health. Superintendents, agency organizers, assistants, agents, managers, and special agents will be held responsible for a strict observance of the rules regarding the delivery of policies as stated in the ordinary rate book.

"The Prudential Insurance Company
of America."

The policy, with this red slip attached, reached the local office and went into the hands of the agent, Garnett. The precise date it reached him is not shown, but it could not be very far from February 5th or 6th. He says he had obtained it "one or two days" before he read in the papers an account of Mr. Yount's death, whereupon he returned the policy to the company. He never notified Mr. Yount, or any of his family, prior to his death, that the application had been accepted or that the policy had been received; and Mr. Yount died without knowing that his application had been acted upon, or that it had been accepted by the home office, or that the policy had been made out and sent to the local office.

Under the foregoing facts, the trial court could not do otherwise than to sustain defendant's demurrer to the evidence. It is undisputed that the policy was never delivered, and also that the written application signed by the deceased expressly provided that it should be a part of the insurance contract, and that the policy should not take effect until its issuance and delivery, and the first premium thereon paid in full, while the applicant was in good health. Consequently we are unable to see what there was to submit to the jury. The provision that the policy should not take effect until its delivery is an agreement the parties could lawfully make, and, having made it, there is no reason why it should not be enforced. Gallop V. Royal Neighbors of America, 167 Mo. App. 85, 150 S. W. 1118; Kirk v. Woodmen of the World, 169 Mo. App. 449, 155 S. W. 39. All that was done by either party to the proposed contract was merely preliminary to

and dependent upon, its final consummation by delivery to Mr. Yount while he was in the

good health he was enjoying at the time he made the proposal to defendant to be insured. No contract could come into existence until his proposal had been accepted upon the terms required, and notice of such acceptance conveyed to him. Kilcullen v. Metropolitan Life Insurance Co., 108 Mo. App. 64, 82 S. W. 966. Clearly a delivery of the policy to the applicant during his lifetime and while he was in good health was required before the things done by the parties could ripen into a contract. It was a condition precedent to a completion of the contract. Rhodus v. Kansas City Life Ins. Co., 156 Mo. App. 281, 137 S. W. 907; Cravens v. N. Y. Life Ins. Co., 148 Mo. 583, 50 S. W. 519, 53 L. R. A. 305, 71 Am. St. Rep. 628. And no recovery can be allowed if the death of the applicant occurs while such condition remains unperformed. Pierce v. New York Life Ins. Co., 174 Mo. App. 383, 160 S. W. 40. Of course, actual manual delivery of the policy may be waived by the insurance company, but there was nothing of this kind in the case. The proof clearly shows that the company sent the policy to its local office in Yount left home in ordinary health on the strict accord with its requirements and the morning of February 6th about 8:30 o'clock. terms specified in the application. The way It was a very cold day-snowy and storming. in which the company sent the policy was So far as the record discloses, the next time not offered to bind either Yount or the plainYount was seen was at 9:30 that night, when tiff by any secret instructions issued to the he was found lying unconscious in the base- company's agent. The applicant and plainment of his home. He died about 5 o'clock tiff were bound by the application; and evithe next morning, February 7th. He had no dence of what the company did was to show negotiations or communications with Garnett that it stood upon the strict terms of the apafter January 22d, the night he signed the plication; that is, that there was no intent application. Nor did he, or anyone else for upon the part of the company to send the

In an action for breach of a written contract concerning the assets, stock, and business management of a corporation, where plaintiff's testimony as to any acts or declarations on the part of a codefendant, insane at the time of the trial, tending to show that his codefendant was his agent, was excluded and only disinterested parties were allowed to testify thereto, there was no violation of Rev. St. 1909, § 6354, providing that in actions where one of the original parties to the contract or cause of action in issue and on trial is insane, the other party shall not be admitted to testify in his own fa

[Ed. Note.-For other cases, see Witnesses, Cent. Dig. §§ 629, 664, 666-669, 671-682; Dec. Dig. 159.] 3. NEW TRIAL OF DAMAGES.

Action by W. L. Powell against D. L. Batchelor and another, with counterclaim by D. L. Batchelor. Judgment for plaintiff, and for D. L. Batchelor upon his counterclaim, In an action for damages for breach of a and from the granting of a motion for a new written contract concerning the assets, stock, trial, defendants appeal. Affirmed.

75-GROUNDS-INADEQUACY

Williams, Hunter & Guffin, of Kansas City, I thought the capital stock was larger than for appellant Batchelor. Edward D. Ellison necessary. Thereupon Powell reduced the and James C. Williams, both of Kansas City, for appellant Hoefer. Cook & Gossett, of Kansas City, for respondent.

capital stock to $12,000. Whether this was done regularly as provided by statute or merely by "unanimous consent" does not appear. It was done, and thereupon Batchelor bought of Powell one-half of the stock paying therefor the sum of $6,000. This money,

TRIMBLE, J. This suit is for damages for breach of a written contract, concerning the assets, stock, and business management for some unexplained reason, was not paid of a corporation called the Investment Security Company. The contract is dated December 17, 1909, and by its terms is between plaintiff and the defendant D. L. Batchelor, but the petition charges that the latter was acting for himself and as agent for his codefendant, James P. Batchelor.

It seems that some time in October, 1909, D. L. Batchelor, who for years had been the station agent for the Santa Fé Railroad at Las Vegas, N. M., came to Kansas City to look after some business for his brother James P. Batchelor. While in the city he became acquainted with plaintiff through an advertisement of the latter's concerning the business (and the opportunity of securing an interest therein) of the Investment Security Company. This was a corporation organized under the laws of Missouri, in 1904, as the Powell-Moore Realty Company, but which had shortly thereafter changed its name to that it now bears. Originally its capital stock was $10,000, but this had been increased to $35,000. At the time Batchelor's attention was called to the company, all its stock was practically owned and controlled by the plaintiff. It was then maintaining what appeared to be an extensive and profitable real estate brokerage and rental business. Its office occupied five or six rooms, and presented an imposing appearance fitted up with desks, furniture, filing cases, cabinets, maps, and all the paraphernalia usually found in a large and prosperous business of that kind. It was also imposingly organized, having a legal department, in charge of an ex-judge from Leavenworth, a rental department, a real estate department, a "business chance" department, a "stockselling" department, and perhaps others. The five or six men who worked under the company did so on a plan by which each man obtained what business he could and divided his commissions with the company. The personnel of these men changed from time to time, some going out, others taking their places.

to Powell, but went into the treasury, and a little over one-third of it seems to have been checked out by Powell to pay old debts of the company.

Batchelor went into the corporation the latter part of October, 1909, and was made president, while Powell was elected secretary and treasurer. The business was conducted by both of them from that time until December 17, 1909. At that date trouble had been brewing for some time between Powell and Batchelor. The latter was claiming that Powell had fraudulently misrepresented the condition of the company to him, and Powell was perhaps objecting to the unauthorized withdrawal by Batchelor of $4,200, the amount remaining in the treasury of the $6,000 Batchelor had paid in. Matters being in this condition, the contract sued on was entered into on the date last above mentioned. It recited that, whereas Batchelor and Powell were the joint owners of the Investment Security Company, and Batchelor was dissatisfied, therefore Powell agreed to turn into the company's treasury a farm of 120 acres in Greene county, and withdraw entirely from the management of the business. He also guaranteed that the liabilities of the company at that time (aside from mortgages on real estate) did not exceed the sum of $1,500. Batchelor agreed and bound himself to pay said liabilities, to continue the business under the same name for a period of six months, during which time Powell was to have the option of buying Batchelor's interest at the price of $6,000. Batchelor further agreed not to sacrifice any of the money or assets of said company without Powell's consent, to maintain said business in good running order, keeping its expenses paid and obligations promptly met during said six months, so that Powell might have an opportunity to get others interested with him in finally taking over the business, or so that a reasonable sale of said business would be possible at any time during that period. It was further provided that said Powell was Whether the company really had a valua- released from any and all obligations of any ble and extensive business or was a mere pre-kind whatever, and absolved from any allegtentious shell does not definitely appear, for reasons which will be hereinafter stated. Evidently, however, plaintiff must have made Batchelor some very flattering representations in regard thereto, judging from the stipulation for the release of Powell from liability on account thereof contained in the contract sued on, and which will be set forth later. At any rate, Batchelor desired to pur

ed liability regarding any previous representations of every kind; that the stock then held by both parties, or either of them, should be offered for sale, and, when any was sold, the proceeds were to be applied to the purchase of Batchelor's stock, and if said Batchelor failed to receive $6,000 within six months, then Powell was to forfeit all interest in the company and its assets. Powell

Pursuant to the execution of this contract, Powell deeded the Greene county farm to the company (subject to incumbrances aggregating $1,500, with interest accrued thereon since the summer and fall of 1909), assigned his stock to Batchelor, turned over the entire management of the business to him, and engaged in another business. Batchelor carried on the business from December 17, 1909, until the 30th of March, 1910. He says that during this time, although he cut down expenses as low as he could, the business was conducted at a loss of $150 per month.

said Batchelor pending the final completion, his $6,000 of stock in the corporation by the of this contract. false and fraudulent representations of the plaintiff (upon which he relied) that the corporation was solvent, had a good-paying business, with assets worth $12,000, when in fact it was not solvent, did not have a paying business, and its assets consisted only of a few hundred dollars. His answer further alleged that, on the representation of plaintiff that the liabilities of the corporation on December 17, 1909, were only $1,500 (aside from mortgages on real estate), he bought and paid for plaintiff's 600 shares of the corporate stock, but that such representation was false and fraudulently made, and known to be so by plaintiff, but relied upon and believed to be true by defendant, who thereupon assumed and agreed to pay said liabilities; that in fact said liabilities amounted to $2,017.34, which defendant was required

pend the sum of $517.34 in excess of the $1,500 represented by plaintiff to be the full amount of said liabilities, for which sum of $517.34, with interest, defendant prayed judgment on his counterclaim.

The jury returned a verdict assessing damages in the sum of $1 against both defendants on plaintiff's petition, and for defendant D. L. Batchelor in the sum of $578.34 on his counterclaim. A motion for new trial filed by plaintiff was sustained, the trial court assigning as a reason therefor that:

"Under the law and the evidence the verdict for the plaintiff on the cause of action set up in should have been for a substantial sum." the petition is insufficient and inadequate and

According to Batchelor's testimony he called on Powell about March 20, 1910, and asked him if he desired to exercise the option contained in their contract, and Powell told him he did not, as he had no intention of ever embarking in that business again. There- to and did pay, thus making defendant exupon, on March 30, 1910, Batchelor caused the corporation to deed the Greene county farm to Blanche Batchelor, wife of James P. Batchelor. He also caused the company to transfer a 25-foot lot on Jackson Avenue in Kansas City to his son C. D. Batchelor, and to turn over to C. D. Batchelor and J. H. Batchelor, sons of J. P. Batchelor, certain stock in the Automatic Rapid Mail Service Company, a corporation organized to manufacture and sell a device for picking up mail sacks by railway trains when going at high speed. This device, however, had not been approved by the United States government and its value depended wholly upon that approval. The recipients of these pieces of property and shares of stock paid nothing to the company for them. On the same day, said D. L. Batchelor made a conditional sale of three-fourths of the capital stock of the P. Batchelor with the contract. This claim Investment Security Company to three men is untenable. There was evidence tending who were then in the company's offices, re- to show that D. L. Batchelor was James P. taining a one-fourth interest himself. It Batchelor's general agent; that the money was provided in this contract of sale that with which half of the stock was originally Bachelor would hold the purchasers harmless purchased by D. L. Batchelor belonged to from anything growing out of the contract James P. Batchelor, and that the latter gave between him and Powell, but it was further the former full authority to act for him in provided that in case Powell chose to exer- reference to such stock and the affairs of cise his option thereunder, then said pur- the company, and left the whole matter of chasers of said capital stock would assign their respective stock in accordance therewith and Batchelor would pay them back the consideration he had received from them, plus 20 per cent. profit, they to have all the earnings of the company that might accrue in the meantime. Batchelor then turned the corporation, its offices and furniture, over to these men, and returned to Las Vegas.

The answer filed in behalf of James P. Batchelor denied that he was a party to said contract, or that he was in any way bound thereby. The defendant D. L. Batchelor admitted the execution of the contract on his part, but denied that in doing so he was acting in any way for James P. Batchelor. He also set up that he was induced to purchase

Whereupon the defendants appealed.

that there is no evidence to connect James

The first contention to be disposed of is

his investment therein to D. L. Batchelor to settle as the latter might think best. The name of James P. Batchelor did not appear in the written contract, but, of course, this makes no difference if D. L. Batchelor was in fact acting for himself and James P. Batchelor. Mechem on Agency, § 701.

[1] It is true James P. Batchelor became insane on the 21st of February, 1910, and was placed under guardianship and appears in this case by his guardian, Charles C. Hoefer. But the authority given by James P. Batchelor to his brother D. L. Batchelor was conferred prior to such insanity, and all the acts and declarations of James P. Batchelor offered in evidence by plaintiff to show such authority were matters that occurred prior

to February 21, 1910; and, while D. L. the cash on hand, and the equities in the Batchelor's acts in disposing of the assets of scattered pieces of real estate were worth a the company as complained of in the peti- substantial amount. How much we would tion, occurred March 10, 1910, that is, after not undertake to say, but certainly more James P. Batchelor became insane, yet such than a merely nominal sum. Batchelor adinsanity did not have the effect, under the mits the execution of the contract, and that circumstances of this case, to terminate D. he disposed of the property, refused to conL. Batchelor's authority or to release James tinue the business, and turned it over to othP. Batchelor from liability for the acts of ers before the expiration of the six months. his said agent. Hill v. Day, 34 N. J. Eq. 'le neither pleaded nor proved any defense 150; Matthiessen v. McMahon, 38 N. J. Law, for so doing. We say he did not prove any 536; Davis v. Lane, 10 N. H. 156. defense because the jury found against him. But it found only nominal damages, when there was substantial evidence that the damages were more than that. Hence the court was strictly within its rights when it set the verdict aside. Morris v. Missouri Pacific R. Co., 136 Mo. App. 393, 117 S. W. 687; Noble v. Kansas City, 222 Mo. 121, 120 S. W. 779.

[2] The record shows that the court sustained the objection to Powell testifying to any acts or declarations on the part of James P. Batchelor tending to show that D. L. Batchelor was his agent, and allowed only disinterested parties to testify thereto, consequently, the evidence tending to show James P. Batchelor's connection with the contract or cause of action in issue and on trial did not come under the ban of section 6354, R. S. Mo. 1909. Under the foregoing circumstances, therefore, the demurrer offered in behalf of James P. Batchelor was properly overruled.

This point being disposed of, it is not seen how we as an appellate court can reverse the action of the trial court in granting plaintiff a new trial.

[4] The trial court's discretion to grant new trials should not be interfered with by an appellate court, unless that discretion has been clearly abused. Hoepper v. Southern IIotel Co., 142 Mo. 378, loc. cit. 387, 44 S. W. 257. If there is any substantial basis for the granting of a new trial, it will be upheld. Fitzjohn v. St. Louis Transit Co., 183 Mo. 74, 81 S. W. 907. Of course, if the case is such that no verdict in favor of the party to Under the contract in question, Powell was whom the new trial is granted could be alentitled to have Batchelor carry on the busi-lowed to stand, then the order granting a ness, in its then condition, for six months new trial will be reversed. Ottomeyer v. from December 17, 1909, and carefully pre- Pritchett, 178 Mo. 160, 77 S. W. 62. Clearly serve its assets, so as to enable him, Powell, the case at bar does not present a situation within that time, to find some one who could where the court's order sustaining the moadvance the $6,000 necessary to pay for tion for new trial can be interfered with. Batchelor's stock. It would seem that under the contract Powell had this right, not only to enable him to get a purchaser for the Batchelor stock, but also, if possible, to sell all of the stock and receive for his own stock everything over and above the $6,000 going to Batchelor. If so, then he had the right to insist on Batchelor's performance of the contract for the full period of six months, even if he himself did not intend personally to go back into the business.

[5, 6] Whether the offer of Brown to buy the Batchelor stock at $6,000 was a mere "bluff" or pretense "framed up" by Powell, as claimed by defendants, in order to give some semblance of great loss on his part, or was a genuine opportunity for Powell to re-enter the company and get back his own stock, had the business been kept intact as required by the contract, need not be decided here. Doubtless there are some suspicious circumstances connected with it. But at that [3] But, however this may be, Batchelor's time Batchelor had already violated the conclaim that Powell told him he did not intend tract and put it out of his power to perform, to exercise any option under the contract and thus Powell was deprived of the opporwas not pleaded as a defense, either by way tunity, during the remainder of the time the of estoppel or otherwise. And even if it had contract gave him, of redeeming his stock been, it was denied by Powell, and thus an and again obtaining possession of the propissue was made for the jury, which found erty. Under such circumstances it would be for plaintiff, but allowed him only the sum no defense on Batchelor's part to say that of $1. Now, the evidence shows, without dis-Powell would not have found a purchaser pute, that the corporation had assets of anyway, though, of course, the value of the more than a mere nominal value. The prop- assets and business at the time they were erty owned by it may have consisted largely turned over to Batchelor, and the consequent of "chips and whetstones," and the value probability of Powell being able to find a of its business and the vastness of its clien- purchaser, and the question of whether tèle may have been greatly exaggerated by Brown's offer was genuine or a "frame-up," the testimony adduced in plaintiff's behalf. would all have a bearing upon the amount of If we were passing on the matter, with our damages sustained. We cannot say that the conservative ideas of such things, we might evidence offered by plaintiff tending to show incline to the view that they were. But that his loss was substantial was no evieven if this be so, the furniture in the office, dence at all, or that the court acted arbi