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'MISSOURI, K. & T. RY. CO. v. PUBLIC UTILITIES COMMISSION
the evidence presented to the commission and ! The evidence also showed that the use of to the trial court. This evidence tends to chat, etc., from the Galena-Joplin group of show that for certain rate-making purposes shipping points comes in competition with the Galena is grouped with certain neighboring use of gravel from Emporia, Council Grove, Missouri towns, including Joplin, which is and Chanute, and with the use of crushed less than 8 miles away, and that this group stone from Iola and Junction City; and the of towns enjoys the same freight rates on trial court might properly give some conchat, etc., except that at the time this rate sideration to those facts. We would not intiwas being considered by the commission, and mate that a rate from Galena could not be for about a year prior thereto, there was in reduced because it would unsettle competieffect in Missouri a statutory rate on chats, tive conditions elsewhere, but it is proper etc., less than the then prevailing Kansas and to consider all these facts in determining interstate rates. The evidence tends to show whether a rate reduction is fairly designed that for several years prior to the filing of to measure the respective rights of shipper the complaint before the defendant commis- and carrier, or to discriminate in favor of a sion by the Galena Commercial Club, the shipper or shipper's club against rivals in shipment of chat had practically ceased ex- business, while largely losing sight of the just cept for use as railway ballast. This was rights of the carrier. If the commission's partly caused by the fact that Galena chat rates from Galena are established, it would was not of so good a quality as the chat ob- be possible for Galena chat to invade and tainable in Joplin and the other towns group- pre-empt a wide marketing territory in ed with Galena. Another reason was that which the producers of gravel and crushed these other towns grouped with Galena had stone now meet and compete under lawful better facilities for loading the chat; and and long-established Kansas freight tariffs. the cost of loading and transportation is Furthermore, if the rates out of Galena are practically all that the chat is worth. At to stand, Joplin and the other nearby points the points of production it has no substantial in the same group would be entitled to a value. The Missouri statutory rate which reduction in their interstate rates, so that appears to have been accorded considerable they might continue to enjoy their trade in weight by the commission in fixing the rate Kansas territory. This is the doctrine of the complained of had not been long in effect, Shreveport case. Railroad Commission of and it was not voluntarily acquiesced in by La. V. St. L. S. W. Ry. Co., 23 Interst. Com. the railway company, and that rate has since Com'n, 31; Houston & Texas Ry. v. United been substantially increased by the Missouri States, 234 U. S. 342, 34 Sup. Ct. 833, 58 state commission. Freight rates, voluntarily L. Ed. 1341; Railroad Co. v. Utilities Com. established by carriers, and rates established mission, 95 Kan. 604, 626, 148 Pac. 667, supra. by authority of law, whether by Legislature Under the doctrine of these cases the plaintiff or by commissions, and rates judicially de- railway is forced to the alternative of contermined to be reasonable and just, are prac- testing the Galena rates, on which little or tical and valuable aids in rate making and no traffic moves, and which could in no event in determining the fairness of a disputed become other than a negligible factor in its rate, provided, of course, that the similarity business, or subject itself to the likelihood of of the traffic conditions is established or a seeing its revenues depleted by a correspondproper allowance is made to overcome exist- ing reduction in the interstate rates from ing differences in traffic conditions. Railroad the other Joplin group points. Furthermore, Co. v. Utilities Commission, 95 Kan. 604, 616, if the Joplin Interstate rates were reduced, 148 Pac. 667. But a freight rate imposed the superior quality of Joplin chat would upon a carrier by whatsoever authority, again drive the inferior Galena chat out of which the carrier has not assented to, and the market. which it has not had a reasonable time and op Whether this was the course of reasoning portunity to contest, is of very little pro- by which the trial court arrived at its findbative value, either for rate making or for ing and judgment we cannot say; but these determining the reasonableness of a question-considerations were well within the purview ed rate, even if the density of traffic and of the evidence. There was considerable opinother pertinent conditions attending it are ion evidence of experts, both for the plainsimilar, or their proper relationship be con- tiff and the defendant. Some of these were ceded or established. It would seem that the traffic men of large experience; and, while abrogation of the Missouri rate from the their eagerness to serve their employers was Joplin group points used by the defendant a thing to be considered in weighing their commission as an aid in determining the testimony, they were subjected to skillful rate from Galena here complained of, and cross-examination, and the experienced trial the granting of a substantially higher rate judge who heard them testify must be deemin Missouri, were evidential circumstances ed to have given proper weight to their testiof considerable force which the trial court mony. Since expert and opinion evidence is could properly consider in determining the competent, its value must largely be left to reasonableness and justice of the commis- the trial judge who sees and hears the witsion's order establishing rates out of Galena. ness, his manner of testifying, his apparent
candor and famillarity with the subject, and facts stated in the opinion, that the court should any interest he may appear to have in the have sustained a demurrer to the evidence. controversy. In our opinion the great preponderance of this class of testimony, what
Appeal from District Court, Cowley ever its worth might be, was that the rates
County. complained of were unreasonably low.
In the matter of the estate of Samuel Besides, the reductions required by the Burkhart, deceased, with claim by John T. order of the commission are themselves of Weaver against John W. Skinner, adminissome evidential potency. These reductions trator. Judgment for claimant, and defendrun from 8 per cent. to 75 per cent. and ant appeals. Reversed and cause remanded, average 34 per cent. below the former, long- with directions to sustain the demurrer to established rates on which this commodity
the evidence. has freely moved from points grouped with Hackney & Moore, of Winfield, for appelGalena in Southeastern Kansas and South- lant. S. A. Smith, of Winfield, for appellee. western Missouri for many years.
 It is finally urged that the railway company did not produce any figures showing
PORTER, J. Samuel Burkhart and John the cost of moving chat from Galena, and T. Weaver
half-brothers. Samuel therefore it was not clearly proved that the Burkhart, who was unmarried, was advanced rate complained of is noncompensatory. But in years and was weak-minded. He owned the courts have recognized that this sort of 160 acres of land in Cowley county near evidence is seldom, if ever, available; and,
Winfield. Some time in 1912 he was ad. until railroads and shippers, or Legislatures judged incapable of transacting business and and commissions and courts, or all of them John W. Skinner was appointed his guardtogether, can settle and agree upon some ian. He went to live with Weaver at the arbitrary factor to be included as the proper latter's home under an arrangement between proportionate burden of investment, main- the guardian and Weaver by which the tenance, administration, taxation, wages, ser- guardian purchased enough land from Wear. vice, etc., which every commodity hauled by er upon which to build a room for Samuel a railroad should bear, the evidence which to live in, and Weaver agreed that if this appellant says was wanting in this case will was done he would board and care for Sambe wanting in every case; and, if the failure uel, for which he was to receive $2.75 per to produce that particular line of evidence week. The sum of $392.86 was expended by is fatal to the carrier's cause, it would al- the guardian in building an addition to ways be useless to seek judicial redress. A Weaver's house and in repairing and enlarg. freight rate lawsuit is in most respects like ing the part owned by Weaver. Samuel any other lawsuit. It has to be decided on Burkhart continued to board with Weaver the evidence which the parties can and do until December 20, 1916, when he was represent, and justice cannot be withheld be moved to a hospital, where he died January cause a rate complained of cannot be shown 2, 1917. During the time he remained with with the precision of a mathematical theorem Weaver the latter presented to the guardian to be noncompensatory.
each month his account for the compensation After a painstaking study of this record agreed upon, and was paid the amount due the court can discern no ground for a re- according to the terms of the agreement. versal, and therefore the judgment is af- Shortly after Samuel Burkhart's death firmed. All the Justices concurring.
Weaver presented to the guardian and was paid his claim of $8, being the amount due
for the portion of the month of December (103 Kan. 97)
prior to the time his brother was taken to In re BURKHART'S ESTATE.
the hospital. Thereafter the guardian filed SKINNER v. WEAVER. (No. 21494.) his final report, and the probate court dis(Supreme Court of Kansas. May 11, 1918.)
charged him as guardian. After the guard
ianship matter had been closed, John W. (Syllabus by the Court.)
Skinner was appointed administrator of the EXECUTORS AND ADMINISTRATORS W451(2)—estate of Samuel Burkhart, deceased. Weav.
CLAIM AGAINST ESTATE-DEMURRER TO Evi-er then filed a demand against the estate in DENCE.
The guardian of the plaintiff's brother made which he claimed to be entitled to compena contract with plaintiff by which the latter sation for the board and care of Samuel was to board and care for his brother for $2.75 Burkhart from January 1, 1914, to May 7, per week. He presented each month for sev- 1916, at the rate of $15 a month, and at the eral years his bill for compensation at this rate, which the guardian paid him during the rate of $1 a day, for 221 days' board and time the brother remained with him. His broth-care from May 7, 1916, to December 20, er died and an administrator was appointed for 1916, aggregating $647. The matter was apthe estate, when plaintiff filed a demand against pealed to the district court, where a trial the administrator for additional compensation, claiming that the services rendered were worth resulted in a judgment in plaintiff's favor more than he had been paid. Held, on the against the estate for the suni of $400. The
administrator brings the case here for re-, been inadequate, but it was the amount view.
agreed upon in the contract, and, besides, The theory upon which Weaver seeks to the evidence shows that part of the considerrecover against the estate is best explained ation agreed upon consisted of the money by his own testimony. He testified that he expended by the guardian in repairing and had an understanding with the guardian fixing up that part of the property belonging that he was to be paid $2.75 a week "to take to Weaver. By presenting his claim each care of Samuel and look after him, board him, month for the compensation fixed by the conand do his washing." He was then asked, tract and accepting payment therefor, the “Was that a reasonable and fair price for the plaintiff is estopped from claiming that an board at the time when it was made?" Over increased rate had been agreed upon, or that the objections of counsel for the administra. he is entitled to recover more because the tor, he testified that it was not a fair contract services rendered were worth more than the the last year or two of Samuel Burkhart's contract price. life; and, again, over objections, was permit The judgment is reversed and the cause ted to testify that he did not think it was a remanded, with directions to sustain the defair contract at the time it was made. He ad-murrer to the evidence. All the Justices mitted that he felt some moral obligation to concurring. take care of his half-brother, who had no other place to go and who wanted to live
(103 Kan. 79) with him. The court overruled objections to STEVENS v. KEEGAN. SAME v. MULRYhis testimony that reasonable compensation
AN. SAME V. BLOCKER. (Nos. for his brother's board, in view of the cost
21487, 21516, 21517.) of living, was $3.50 a week; that the cost in- (Supreme Court of Kansas. May 11, 1918.) creased about half a dollar a week each
(Syllabus by the Court.) year until the last year or two, and that a
1. BILLS AND NOTES 365(1)-BONA FIDE reasonable compensation for the board alone
PURCHASER-DEFENSE OR COUNTERCLAIM. would be from $4.50 to $5 a week, and, fur No defense, counterclaim, or set-off can ther, that after his brother suffered a par- reduce the amount of the judgment that should alytic stroke in May, 1916, it was worth, in in the hands of one who took it from one who
be rendered on a negotiable promissory note his opinion, $15 a week to board and care for claimed to hold it in due course, where the him. Mrs. Weaver testified that at two or defense of want of good faith in acquiring the three times she complained to the guardian note by such holder is set up against the note,
and the special findings of the jury show that that they were not getting enough compen- | the defense has not been established by the evisation. Her testimony, which was quite dence. vague and uncertain, was:
2. BILLS AND NOTES 315-ASSIGNMENT "Well, so far as I remember, Mr. Skinner said
EQUITIES. he would pay us more in the future;
One who acquires a negotiable promissory thing similar to that; I don't just remember. note, by an assignment written on a separate Q. Said he didn't have the money now, but in- piece of paper, from one who is not a holder timated that he might have later? A. Some in due course, takes the note subject to all thing similar to that."
equities and defenses in favor of the maker. The plaintiff himself did not testify to Appeal from District Court, Marshall any agreement with the guardian for ad-County. ditional compensation. We think the court
Actions by F. L. Stevens against T. M. should have sustained the administrator's de- Keegan, J. C. Mulryan, and Charles Blocker. murrer to the evidence. The plaintiff ad- Judgment for defendants in each case, and mitted making a contract with the guardian plaintiff appeals. Judgments reversed, and to board and take care of his brother for a new trial ordered. $2.75 a week, and the uncontradicted evidence Guy S. Calkins, of Iowa City, Iowa, Ira K. shows he presented each month a' bill to the Wells, of Seneca, Walter T. Griffin, of Marysguardian for compensation at the agreed ville, and Godard & Myers, of Topeka, for rate, which the guardian duly paid. He re appellant. W. J. Gregg, of Frankfort, W. W. lies on the testimony of Mrs. Weaver to the Redmond, of Marysville, and C. L. Thompson, effect that she had some kind of an under- of Hoxie, for appellees. standing with the guardian that at some indefinite time in the future he would pay MARSHALL, J. In this action the plainmore, and upon the claim that the services tiff seeks to recover $289, the amount alleged rendered were worth more than the compen- to be due on a negotiable promissory note. sation agreed upon. The plaintiff had no He recovered judgment for $13.92, and apclaim against his brother in the latter's life- peals. The note was given by the defendant time because Samuel Burkhart was under to the Lyon-Taylor Company of Iowa City, the care of a guardian. After Samuel's Iowa, for a piano, a watch, and some silverdeath and before the appointment of an ad- ware to be distributed as prizes in a scheme ministrator, the guardian paid the balance for advertising and promoting sales in the claimed to be due according to the terms of business of the defendant, who was a hardthe agreement. The compensation may have ware merchant at Axtell, Kan. M. F. Price
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes 172 P.-65
of Iowa City, under the trade-names of the, eral security on or about the 9th day of AuLyon-Taylor Company, the Puritan Manufac- gust, 1913? Answer. Yes. turing Company, and the Franklin Price ComCity, Iowa, at the time it took the note in suit,
“(5) Was the First National Bank of Iowa pany, conducted three separate kinds of busi- guilty of bad faith in so doing? Answer. Yes. ness. The one under the name of the Lyon- * (6) If you answer the above question in Taylor Company was that of increasing sales the affirmative, then state the particular facts
constituting such bad faith. Answer. On acby country merchants through contests, a
count of suits pending on similar notes. scheme of advertising planned and sold by “(7) Did the First National Bank of Iowa the company. The one under the name of the City, Iowa, have notice of any defect in the Puritan Manufacturing Company was that note in suit at the time it acquired the same?
Answer. Yes. of selling jewelry; while the one under the
"(8) If you answer the above question in name of the Franklin Price Company was the affirmative, then state the particular facts that of selling perfumery. The defendant of which it had notice. Answer. By past exsigned an order for a piano, a watch, and perience on similar notes." some silverware, and for the advertising
There was evidence which tended to show matter and instructions that went therewith, that the Puritan Manufacturing Company and put on contests for the piano, the watch, transferred the note to the First National and the silverware. These were to be dis- Bank of Iowa City, as collateral, to secure tributed as premiums to candidates receiv- the payment of the notes of that company ing the highest number of votes. The con- aggregating $8,000; that about a month betract contained the following provisions:
fore these notes became due, the bank notified “Increased Sales Guaranteed.-Sales preced- the company that payment of the notes would ing twelve months were $ Next twelve be expected at maturity; that M. F. Price, months are hereby guaranteed to be $31,200, or Mr. Taylor, a representative of Price, went and if .092 per cent. of said sales does not to the plaintiff and induced him to go to the amount to $289.00 we hereby agree to pay to bank and purchase the notes of the Puritan purchaser the deficiency in cash. agree to send our bond in the sum of $1,000.- Manufacturing Company and take the collat00 to cover this agreement."
eral then held by the bank to secure the payThe contract had printed thereon the fol- ment of the notes as security in the hands lowing.
of the plaintiff; that an arrangement was “The attached note is tendered in settle- then made between Price or Taylor and the ment of this order and the company is au- plaintiff by which, if any of the notes taken thorized to detach same when the order is accepted."
as collateral were unpaid at maturity, such
notes should be turned over for collection to Under the contract, the goods described
an attorney to be named by Price, and the were to be shipped by the Lyon-Taylor Com- plaintiff should not be at any loss or expense pany to the defendant f. o. b. transportation on account of such collection. The note sued company. The Lyon-Taylor Company did not on was among those held by the bank as colship some of the goods promptly, and those lateral, and was, by the bank, turned over to goods were not in the hands of the defendant
the plaintiff. when they were to be delivered to the con
 1. The plaintiff requested a peremptory testants as prizes.
instruction for judgment in his favor, moved The note sued on was attached to the con- for judgment on the special findings of the tract at the time it was signed, but was de jury, and filed a motion for a new trial, in tached before it was transferred. A copy which he alleged "that the general verdict of the note attached to the petition was in and the answer to the special questions are dorsed, “Lyon-Taylor Company, by M. H. contrary to the evidence." The request for Taylor.” The answer contained a general instructions and the motions were denied, denial, an allegation that the plaintiff was and error is assigned thereon. The note was not the owner of the note in good faith, and past due when the plaint became the ownthat if he ever did purchase the note, it was
er of it, and he was not the holder thereof after the maturity thereof, with notice of the in due course; but he claims to have derived defenses and equities of the defendant. The his title from a holder in due course, and answer further alleged the failure of the that, therefore, he held the note free from Lyon-Taylor Company to perform their part
any defenses in favor of the defendant. Secof the contract, set up a counterclaim of tion 6585 of the General Statutes of 1915 $175.55, alleged damages in the sum of $100,
provides that: prayed judgment for $271.55, and tendered
"A bolder who derives his title through a into court $117.45. The amount tendered holder in due course, and who is not himself a into court was 92 hundredths of 1 per cent. party to any fraud or illegality, affecting the of the gross sales made by the defendant for instrument, has all the rights of such former the period agreed to under the contract. The holder, in respect of all parties prior to the
latter." answer was verified. The jury returned a
Section 6579 of the General Statutes of verdict for $13.92 in favor of the plaintiff, 1915 reads: and answered certain special questions as
"A holder in due course is a holder who has follows:
taken the instrument under the following con"(4) Did the First National Bank of Iowa ditions: (1) That it is complete and regular City, Iowa, acquire the note in suit as collat- | upon its face; (2) that he became the holder Barber, 35 ant.
of it before it was overdue, and without notice some evidence to show that the bank obtainthat it bad been previously dishonored, if suched the note by assignment from that comwas the fact; (3) that he took it in good faith and for value; (4) that at the time it was ne- 'pany. The Puritan Manufacturing Company gotiated to him he had no notice of any in- was not the holder of the note in due course. firmity in the instrument or defect in the ti. The name was one of the trade-names under tle of the person negotiating it."
which M. F. Price did business, and he had What was there to show that the First notice of all defenses and equities in favor National Bank of Iowa City was not a hold of the defendant. If the bank obtained the er in due course? This question is answered note by assignment, without reference to the by the special findings of the jury. Those indorsement of the Lyon-Taylor Company, it findings were not sufficient to establish that took the note subject to the equities and defact. Neither the fact that suits on other fenses of the defendant. McCrum v. Corby, notes of like character given by other par- 11 Kan. 464; Hadden v. Rodkey, 17 Kan. ties, nor the fact that the bank had previ- | 429; Hatch v. Barrett, 34 Kan. 223, 8 Pac. ously had like experience on similar notes, | 129; Briggs v. Latham, 36 Kan. 205, 13 Pac. was sufficient to establish that the bank was 129; Offenstein v. Weygandt, 89 Kan. 739, guilty of bad faith in taking the note sued 132 Pac. 991. on, or that it was not the holder thereof in
In Farnsworth v. Burdick, 94 Kan. 749, due course.
When the note was delivered 147 Pac. $63, it was held that the holder of to the bank, it was indorsed in blank by a note by assignment written on the back the payee thereof. The note was then pay. thereof is a holder in due course. But that able to bearer, and was negotiable by deliv- case does not overrule previous decisions of ery. Gen. Stat. 1915, 8 6561. The burden this court, where the assignment is made in was on the defendant to prove that the bank writing and is not attached to the note. The was not the holder of the note in good faith. plaintiff took the note from the bank subject Mann v. National Bank, 34 Kan. 746, 10 to the equities and defenses of the defendPac. 150; Savings Association v. Kan. 488, 11 Pac. 330; Gafford v. Hall, 39
Other matters are urged by the plaintiff, Kan. 166, 17 Pac. 851; National Bank v. El- but there is no substantial merit in any of llott, 46 Kan. 32, 34, 26 Pac. 487; Brook v. them, and none of them is of sufficient imTeague, 52 Kan. 119, 125, 34 Pac. 347; Clark portance to justify discussion. V. Skeen, 61 Kan. 526, 532, 60 Pac. 327, 49
The judgment is reversed, and a new trial L. R. A. 190, 78 Am. St. Rep. 337; Gen. is ordered. Stat. 1915, 8 6586. Under the findings of the
The same order is made in Nos. 21516 and jury, the judgment on the note could not be 21517. All the Justices concurring. reduced by any matter set up in defense.  2. To sustain the judgment, the de
(103 Kan. 142) fendant argues that the evidence did not
SMITH et al. v. CITY OF COURTLAND prove the indorsement of the note by the Ly.
et al. (two cases). (Nos. 21725, 21788.) on-Taylor Company, but did prove that the First National Bank of Iowa City acquired
(Supreme Court of Kansas. May 11, 1918.) the note from the Puritan Manufacturing
(Syllabus by the Court.) Company by assignment on a separate sheet 1. MUNICIPAL CORPORATIONS Om 301-CHANGE of paper. The indorsement of the note by OF GRADE ORDINANCE-STATUTE. the Lyon-Taylor Company was established street may be established by ordinance, and
The statute providing that the grade of a by abundant evidence. The defendant's con- when so established shall not be changed withtention concerning the transfer of the note out a three-fourths vote of the city council, does by the Puritan Manufacturing Company by not prevent the establishment of a grade by any assignment is based on the following testi- other method than the adoption of an ordinance.
2. MUNICIPAL CORPORATIONS 278(3) mony:
STREET PAVING—ASSESSMENTS-STATUTE. "Q. Now, how did you know whether you The statute providing that for the purpose were getting any title to that Lyon-Taylor pa- of paying for certain improvements, after the per at that time if you did not know who com streets "have first been brought to grade," asposed the firm? A. Because it was indorsed sessments shall be made upon the abutting propby the Lyon-Taylor Company, and subsequent- erty, does not fix the order in point of time in lý indorsed by the Puritan Manufacturing Com- which the grade shall be established with repany, and the Puritan Manufacturing Com- spect to the contracting for the improvements pany guaranteed to us the genuineness of the or the levying of the assessments, but is intendprevious indorsement. Q. Do you want to be ed to insure that the abutting property shall understood as testifying that the notes in suit not be required to carry the expense of bringing in these cases are indorsed by the Puritan the street to grade, by providing that it is only Manufacturing Company? A. They should be the expense that accrues after that work has indorsed by the Puritan Manufacturing Com- been done which shall be charged to the adjoinpany; if not, the assignment was made in sepa- ing lots. rate assignments; in any event the genuine- 3. MUNICIPAL CORPORATIONS 323(1, 3) ness of the paper would be guaranteed to us by STREET IMPROVEMENT-GRADING-EVIDENCE the Puritan Manufacturing Company."
The evidence held to warrant a finding that The note was not indorsed by the Puritan the price fixed in a contract for curbing and gutManufacturing Company. There was then tering certain streets included a charge for
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes