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The opinion of the court was delivered by
Allegrucci, J.:
This is an appeal by the plaintiffs from the order of the district court dismissing consolidated civil actions for lack of subject matter jurisdiction based upon the plaintiffs’ failure to exhaust administrative remedies. The defendants are the State of Kansas, the Department of Revenue, the Secretary of Revenue, the Director of Property Valuation, the County Treasurer of Johnson County, and the county treasurers of 76 additional counties. In the order of dismissal, the district court expressly found that plaintiffs’ complaint was meritorious and that the 1989 county average tax rate should have been used in calculating motor vehicle taxes for 1990. Defendants cross-appeal from that part of the district court’s order in which K.S.A. 79-5105 is interpreted.
Subpart (a) of K.S.A. 79-5105 sets forth the procedure for determining the value of motor vehicles; subparts (b) and (c) provide the method for determining the amount of tax to be charged on motor vehicles:
“(b) multiply the amount determined under (a) by 30% (which shall constitute the taxable value of the motor vehicle); and
“(c) multiply the taxable value of the motor vehicle produced under (b) above by the county average tax rate for the next preceding tax year.”
Motor vehicle taxes were first collected under this tag and tax law, as the parties call it, in 1981. At that time the counties were instructed by the Secretary of Revenue to use county average tax rates from 1979 for their calculations of 1981 motor vehicle taxes. In each year since then, the county average tax rates from two years prior to the collecting year were certified to the counties for use in calculating motor vehicle taxes.
Plaintiffs contend that the county average tax rates for 1989, rather than 1988, should have been used to calculate motor vehicle taxes in 1990. They complain that, as a result of the 1988 rates being used, taxpayers in 77 counties paid more in motor vehicle taxes than they would have if the proper rate had been used. For example, the county average tax rate in Johnson County for 1988 was .177583 and for 1989 was .106749. Plaintiffs assert that the overcharge in 1990 was more than $60 million, and that the number of affected taxpayers is between 1 and 1.5 million. The average overcharge, therefore, is approximately $50.
The county average tax rate is not shown on the motor vehicle statements, and it is not apparent from the statements whether the formula of K.S.A. 79-5105 has been followed. Plaintiffs Jerry Dean, Dana Dean, James Underwood, and Roma Underwood, among others, executed affidavits stating that, at the time they paid 1990 motor vehicle taxes, they were unaware of any overcharge and did not become aware of any overcharge until it was suggested to them by someone else.
K.S.A. 1991 Supp. 79-2005 and K.S.A. 1991 Supp. 74-2426 set out the administrative procedure for protesting the payment of taxes and for recovery of protested taxes. It is uncontroverted that plaintiffs did not follow the procedure. It also is uncontroverted that the time in which the plaintiffs could have followed the procedure for protesting 1990 motor vehicle taxes has expired.
Plaintiffs in the Underwood case initially filed in this court an original class action in mandamus on behalf of all motor vehicle taxpayers in the 77 defendant counties. This court dismissed the action on December 7, 1990, under Supreme Court Rule 9.01(a) (1991 Kan. Ct. R. Annot. 41), stating that adequate relief appears to be available in the district court.
A few days after this court’s dismissal, the Underwood case was filed in Johnson County District Court as a class action on behalf of motor vehicle taxpayers in 77 counties, including Johnson County. The Dean case was also filed in Johnson County, and the cases were consolidated; neither class was certified. The class defendants in the Underwood case included the county treasurers of the 77 counties.
The single underlying issue in this case is whether taxing authorities acted contrary to K.S.A. 79-5105 in calendar year 1990 by taxing motor vehicles based on the 1988 county average tax rate rather than the 1989 county average tax rate. The issue in this appeal is whether the district court lacked subject matter jurisdiction on the ground that plaintiffs had failed to exhaust administrative remedies. The administrative procedure for a taxpayer’s protesting the collection of allegedly unlawful taxes has as its first step, at the time of paying the taxes, the filing of a written statement with the county treasurer stating the grounds for protest. K.S.A. 1991 Supp. 79-2005(c) provides: “If the grounds of such protest shall be that any tax levy, or any part thereof, is illegal, such statement shall further state the exact portion of such tax which is being protested.” The county appraiser must consider the taxpayer’s grievance, and the taxpayer may appeal an unsatisfactory result to the State Board of Tax Appeals (BOTA).
K.S.A. 1991 Supp. 74-2426(c)(4) provides that any action of BOTA may be reviewed by the district court of the county in which the property is located. “The parties to the action for judicial review shall be the same parties as appeared before the board in the administrative proceedings before the board.” K.S.A. 1991 Supp. 74-2426(c)(l). Review must be “in accordance with the act for judicial review and civil' enforcement of agency actions,” K.S.A. 77-601 et seq. K.S.A. 1991 Supp. 74-2426(c).
K.S.A. 77-612 provides, in pertinent part, as follows: “A person may file a petition for judicial review under this act only after exhausting all administrative remedies available within the agency whose action is being challenged and within any other agency authorized to exercise administrative review.” This court has stated the rule in less rigid terms: “The well-recognized rule in this state is that where a full and adequate administrative remedy is provided in tax matters by statute, such remedy must ordinarily be exhausted before a litigant may resort to the courts.” (Emphasis added.) State ex rel. Smith v. Miller, 239 Kan. 187, Syl. ¶ 1, 718 P.2d 1298 (1986).
There is no claim by plaintiffs that they exhausted, or even initiated, the administrative remedies. They contend, however, that in the circumstances of this case, it was not necessary for them to do so. They argue that for numerous reasons the administrative remedies in this case are not “full and adequate” or “clear and certain.”
Plaintiffs’ first reason is that the controlling issue is “purely judicial” in nature and no benefit is gained by deferring the matter to the Department of Revenue or BOTA. The purpose to be served by requiring exhaustion of administrative remedies and the relative functions of the administrative agency and the ju diciary were stated by this court in Jenkins v. Newman Memorial County Hospital, 212 Kan. 92, 95, 510 P.2d 132 (1973):
“The doctrine of exhaustion of administrative remedies is directed toward promoting proper relationships between the courts and administrative agencies charged with particular administrative and regulatory duties. It promotes orderly procedure and requires a party to exhaust the administrative sifting process with respect to matters peculiarly within the competence of the agency.”
In the realm of taxes, matters of assessment, exemption, equalization, and valuation are administrative in character. See Symns v. Graves, 65 Kan. 628, 636, 70 Pac. 591 (1902). Under Kansas law, it would be unwarranted for a court to entertain a tax suit on any of these matters of administrative expertise where administrative remedies had not been pursued.
Most of the cases relied upon by defendants for the proposition that exhaustion of administrative remedies is a condition precedent to filing suit in the district court involve challenges to administrative matters. For example, Tri-County Public Airport Authority v. Board of Morris County Comm'rs, 233 Kan. 960, 666 P.2d 698 (1983), was an action requesting an exemption from the payment of ad valorem property taxes assessed against property owned by the Airport Authority but rented to private citizens for various private uses. The plain tiff s claim that its property should enjoy tax-exempt status fell within the administrative agency’s sphere of expertise, and the district court was without jurisdiction.
Another case cited by defendants is State ex rel. Smith, 239 Kan. 187. In affirming the district court’s dismissal, this court observed: “Although appellant asserts the unconstitutionality of the statutes and seeks extraordinary relief, its obvious complaint is that the assessed valuation of its real property is too high. This is an issue that must be determined by exhaustion of administrative remedies before resorting to the courts.” (Emphasis added.) 239 Kan. at 190.
Board of Osage County Comm'rs v. Schmidt, 12 Kan. App. 2d 812, 758 P.2d 254, rev. denied 243 Kan. 777 (1988), also revolves around the assessment of real property. In a foreclosure action, the Schmidts raised as defenses that their property was assessed at a rate greater than other property in the county and that the appraisal was not based on fair market value. Having failed to bring these administrative matters to the attention of thé administrative agency, the Schmidts were prohibited from raising them as defenses in the foreclosure action.
There are other matters which are judicial rather than administrative in character. Construction or interpretation of statutory language is a judicial function. State ex rel. Stephan v. Kansas Racing Comm’n, 246 Kan. 708, 719, 792 P.2d 971 (1990). In these matters, the expertise lies with the court rather than the agency. It does not follow, however, that the agency or ROTA is precluded from interpreting a statute. Interpretation of a statute is a necessary and inherent function of an agency in its administration or application of that statute. In Kansas Racing Comm’n, this court said:
“Usually, the legal interpretation of a statute By an administrative board or agency that is charged by the legislature with the authority to enforce the statute is entitled to great judicial deference. Ordinarily, the court will give deference to the agency’s interpretation of the law, but, when reviewing questions of law, the trial court may substitute its judgment for that of the agency. Kansas Bd. of Regents v. Pittsburg State Univ. Chap. of K-NEA, 233 Kan. 801, 809, 667 P.2d 306 (1983). In Kansas Ass’n of Public Employees v. Public Employees Relations Bd., 13 Kan. App. 2d 657, 659, 778 P.2d 377 (1989), the Court of Appeals recently held that an agency’s interpretation of a challenged statute may be entitled to ‘controlling significance in judicial proceedings’ (citing Pittsburg State, 233 Kan. at 809).
“This court has recognized that, when a statute is ambiguous, the interpretation placed upon it by an administrative agency whose duties are to carry .the legislative policy into effect should be given great weight and may be entitled to controlling significance when the scope and limitations of the powers of the agency must be determined in judicial proceedings. Cities Service Gas Co. v. State Corporation Commission, 192 Kan. 707, 714, 391 P.2d 74 (1964); Southwestern Bell Telephone Co. v. Employment Security Board of Review, 189 Kan. 600, 607, 371 P.2d 134 (1962).” 246 Kan. at 719-20.
The interpretation of the statute in the present case by the Secretary of Revenue was a necessary administrative act in implementing K.S.A. 79-5105. That interpretation, however, is subject to review as a question of law by the courts. Hence, if the protesting taxpayer exhausts the administrative procedures and raises all issües, including those of statutory construction, at the ádministrative level, the district court on review is authorized to reconsider and redetermine the construction of that statute. “The district court has authority to construe a statute at variance with BOTA” without “interfer[ing] with the administrative agency’s expertise in taxation matters.” In re Order of Board of Tax Appeals, 236 Kan. 406, 410, 691 P.2d 394 (1984).
Plaintiffs also argue that it is a well-established principle that the exhaustion of state administrative remedies is not required before an action in state court under 42 U.S.C. § 1983 (1988) may be commenced. They cite Felder v. Casey, 487 U.S. 131, 101 L. Ed. 2d 123, 108 S. Ct. 2302 (1988); Patsy v. Florida Board of Regents, 457 U.S. 496, 73 L. Ed. 2d 172, 102 S. Ct. 2557 (1982); and Monroe v. Pape, 365 U.S. 167, 5 L. Ed. 2d 492, 81 S. Ct. 473 (1961).
Plaintiffs attack the administrative procedure set out in 79-2005 and 74-2426 as being inadequate because it does not provide for class-wide relief. Plaintiffs argue that, because of this inadequacy in the administrative remedy, it does not meet the due process requirements of the federal Constitution. An action in the district court where there is a mechanism for processing a class action does pass constitutional muster. Thus, plaintiffs argue, because the only constitutionally adequate remedy available to plaintiffs lies in the district court, there can be no jurisdictional requirement that they exhaust administrative remedies as a prerequisite to maintaining their class action in the district court.
Defendants respond that post-deprivation tax appeal procedures, such as provided by 79-2005, are constitutional where they provide a “clear and certain remedy.” McKesson Corp. v. Florida Alcohol & Tobacco Div., 496 U.S. 18, 51, 110 L. Ed. 2d 17, 110 S. Ct. 2238 (1990). Defendants cite Coleman v. McLaren, 631 F. Supp. 749, 762 (N.D. Ill. 1985), for the proposition that the lack of class action administrative procedures does not render the administrative remedy inadequate.
Defendants further respond that Fair Assessment in Real Estate Assn. v. McNary, 454 U.S. 100, 70 L. Ed. 2d 271, 102 S.Ct. 177 (1981), establishes a different rule for state tax cases. McNary involved the extension of the prohibition of the Tax Injunction Act to a federal court action seeking damages under § 1983 for a state tax problem. Justice Brennan, in his concurring opinion, spells Out his views of federal/state comity. He stated his concern with the special reasons for the policy of federal noninterference with state taxation and quoted from an earlier opinion setting out the considerations which have led to restraint:
“ ‘The special reasons justifying the policy of federal noninterference with state tax collection are obvious. The procedures for mass assessment and collection of state taxes and for administration and adjudication of taxpayers’ disputes with tax officials are generally complex and necessarily designed to operate according to established rules. State tax agencies are organized to discharge their responsibilities in accordance with the state procedures. If federal declaratory relief were available to test state tax assessments, state tax administration might be thrown into disarray, and taxpayers might escape the ordinary procedural requirements imposed by state law. During the pendency of the federal suit the collection of revenue under the challenged law might be obstructed, with consequent damage to the State’s budget, and perhaps a shift to the State of the risk of taxpayer insolvency.’ ” 454 U.S. at 137 n.27 (Brennan, J., concurring) (quoting Perez v. Ledesma, 401 U.S. 82, 128 n. 17, 27 L. Ed. 2d 701, 91 S. Ct. 674 [1971] [Brennan, J., concurring and dissenting]).
His concern leads to the conclusion that “[wjhere administrative remedies are a precondition to suit for monetary relief in state court, absent some substantial consideration compelling a contrary result in a particular case, those remedies should be deemed a precondition to suit in federal court as well.” 454 U.S. at 137.
Plaintiffs cite Hogan v. Musolf, 157 Wis. 2d 362, 459 N.W.2d 865 (1990), which rejects the above reasoning and refuses to “read McNary as creating any limitation on sec. 1983 actions in state courts.” 157 Wis. 2d at 375 n.9. Defendants cite cases from other states which support Justice Brennan’s concern as expressed in McNary. See Owner-Operators Independent Drivers Assn. of America v. State, 209 Conn. 679, 553 A.2d 1104 (1989); Raschke v. Blancher, 141 Ill. App. 3d 813, 491 N.E.2d 1171 (1986); Stufflebaum v. Panethiere, 691 S.W.2d 271 (Mo. 1985); and Johnston v. Gaston County, 71 N.C. App. 707, 323 S.E.2d 381 (1984), rev. denied 313 N.C. 508 (1985).
We find the rationales of the cases cited by defendants persuasive. The considerations that have prompted federal court restraint in matters of state taxation also should prompt restraint where a federal cause of action is brought in state court challenging matters of state taxation. At minimum, the federal cause of action should not create the necessity for the state court to forego restraint in such matters.
Coleman, 631 F. Supp. 749, is authority for the proposition that the absence of class-wide remedies does not necessarily mean that the administrative remedy is inadequate. It does not preclude, however, a determination that the absence of a class mechanism in some circumstances may constitute inadequacy.
In Coleman, a class action under § 1983 was dismissed for lack of subject matter jurisdiction pursuant to the Tax Injunction Act, 28 U.S.C. § 1341 (1988), which prohibits federal courts dealing with state tax complaints from ordering injunctive relief where state law provides a plain, speedy, and efficient remedy in state court. McNary, 454 U.S. 100, extends the prohibition of the injunction statute to federal courts granting damages under § 1983 in state tax cases.
The principal issue for a federal court applying ..the Tax Injunction Act is federal/state comity, and the general inclination of federal courts to step gingerly in this area is reflected in the overwhelming majority of these cases resulting in deferral to the state tribunals.
In the present case, plaintiffs challenge the interpretation placed on K.S.A. 79-5105 by the Secretary of Revenue. Based upon that challenge, plaintiffs are seeking the recovery of taxes through various state remedies and pursuant to 42 U.S.C. § 1983.
In Felten Truck Line v. State Board of Tax Appeals, 183 Kan. 287, 327 P.2d 836 (1958), this court considered a challenge to the constitutionality of the motor carrier tax statute as well as the interpretation and administration of the Motor Carrier Act by the state commission of revenue and taxation. This court made a distinction between a challenge to the commission’s acts in implementing the statute and a challenge to the statute itself. One of the arguments raised by defendants was that “plaintiffs had an adequate remedy at law by way of administrative proceedings under G.S. 1949, 79-1702.” 183 Kan. at 293. This court said:
“Insofar as the plaintiffs complain of the commission’s valuation of their property and other acts of the commission in its application of the statute, the commission’s position is well taken. The commission should not be subjected to litigation in the courts until the alleged error has been called to its attention and it has had an opportunity to consider and correct the grievance. (Gray v. Jenkins, 183 Kan. 251, 326 P.2d 319.)” 183 Kan. at 293.
In the present case, plaintiffs’ class action petition filed in the district court states that “[t]his action seeks the refund of overcharges and constitutionally unlawful takings by the defendants during calendar year 1990.” The purpose of plaintiffs’ action is the recovery of the motor vehicle taxes paid as a result of the Department of Revenue’s application of K.S.A. 79-5105. Clearly, plaintiffs are seeking tax relief, and that is the sole objective of their various claims against the defendants. In Tri-County, 233 Kan. 960, this court, in noting that K.S.A. 1980 Supp. 79-2005 was part of the 1980 reforms in the tax procedure, said:
“The 1980 reforms in tax procedure are contained primarily in three statutes. The first is K.S.A. 1980 Supp. 79-2005 which was effective July 1, 1980. The former language in that section, which permitted an aggrieved taxpayer to pay his taxes under protest and then file an action within thirty days in a court of competent jurisdiction, was eliminated. His sole remedy is notv to file an application for refund within the thirty-day period with BOTA. This statutory change achieved the legislative objective of eliminating direct action in the district court, thus channeling all tax matters through BOTA, the paramount taxing authority in the state. Northern Natural Gas Co. v. Dwyer, 208 Kan. 337, 492 P.2d 147 (1971), cert. denied 406 U.S. 967 (1972).” (Emphasis added.) 233 Kan. at 964.
In State ex rel. Smith, 239 Kan. 187, the plaintiff argued that it had no adequate administrative remedy because ROTA had no authority to rule upon the constitutionality of the tax statutes or provide the relief sought by way of mandamus and quo warranto. This court did not agree. In affirming the district court’s dismissal, this court observed:
“A party aggrieved by an administrative ruling is not free to pick and choose a procedure in an action in the district court in order to avoid the necessity of pursuing his remedy through administrative channels. Since the adoption of the act for judicial review and civil enforcement of agency actions (K.S.A. 77-601 et seq.), it would appear that relief such as sought here should be raised as new issues in the district court on appeal from the BOTA. See K.S.A. 77-617.
“. . . It appears clear that appellant was not concerned with the constitutionality of the various statutes so long as the tax increases were limited to individual lot owners and appellant was the recipient of preferential tax assessment.
“It is obvious appellant is seeking tax relief without first exhausting the administrative remedies available and which might result in the relief sought. If unsuccessful at the administrative level of the BOTA, appellant will then have the right of appeal to the district court.” 239 Kan. at 190-91.
Here, the plaintiffs’ claim for recovery of the motor vehicle registration tax is an attempt to seek tax relief without first complying with K.S.A. 1991 Supp. 79-2005. K.S.A. 1991 Supp. 79-2005 and K.S.A. 1991 Supp. 74-2426 provide the plaintiffs with a clear and certain remedy for complete and adequate relief and, therefore, must be complied with before resorting to the courts. The district court properly dismissed the plaintiffs’ claims for the recovery of taxes for lack of subject matter jurisdiction.
However, the district court does have original jurisdiction to hear claims for declaratory judgment and injunctive relief without plaintiffs’ first complying with K.S.A. 1991 Supp. 79-2005 and K.S.A. 1991 Supp. 74-2426. The plaintiffs’ claim for declaratory judgment seeks an order of the district court declaring that “the provisions of K.S.A. 79-5105 have been violated by the defendants ... by the utilization of the 1988 county average tax rate of .17758 instead of the 1989 county average tax rate of .10675 in the taxation of motor vehicles registered in Johnson County in 1990.” This is a claim brought pursuant to K.S.A. 60-1701 and, if considered separately from the claims for recovery of taxes paid, would not be subject to the requirement of exhaustion of administrative remedies. However, as previously noted, thé stated purpose of plaintiffs’ case is to recover the motor vehicle registration taxes paid for 1990. All of these various claims are directed toward accomplishing that purpose. The plaintiffs do not separate out their claims for declaratory judgment or injunctive relief or argue these claims should be considered independent of the other claims. Even if treated separately, these claims are limited to the defendants’ application of the statute in 1990; therefore, there is nothing to enjoin, and since plaintiffs have failed to comply with K.S.A. 1991 Supp. 79-2005, any determination would be unavailing and have no practical effect as to the real issue presented, which is the recovery of the taxes paid. Therefore, plaintiffs’ claims for declaratory judgment and injunctive relief are moot and subject to dismissal for that reason if not for lack of subject matter jurisdiction. In any event, since these claims are moot, they will not be decided on appeal. State ex rel. Stephan v. Johnson, 248 Kan. 286, 807 P.2d 664 (1991). The ruling of the district court dismissing all of plaintiffs’ claims was correct.
In light of our decision, we need not consider the defendants’ cross-appeal.
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The opinion of the court was delivered by
Abbott, J.:
This appeal involves an action to enforce a mechanic’s lien.
The record before us is not lengthy, and many of the dispositive facts are not in dispute. Maggie Jones Southport Cafe, Inc., (Maggie Jones) leased real estate from 95th & Nall Associates (95th & Nall), which owns a shopping center, to open and operate a restaurant. The leased space previously had been used as a restaurant.
To operate the restaurant, Maggie Jones obtained a Small Business Administration (SBA) loan, which was secured by the leasehold improvements. Maggie Jones contracted with Kansas City Heartland Construction Company (Heartland) for Heartland to renovate the restaurant site. Heartland was aware Maggie Jones leased the restaurant site from 95th & Nall.
Maggie Jones became insolvent. At the time Maggie Jones filed bankruptcy, it owed Heartland $104,000.
95th & Nall did not realize Maggie Jones owed money to any contractors until after the restaurant closed. Shortly thereafter, 95th & Nall received notice the SBA would be enforcing its secured interest in the improvements through a public auction. A public auction was held.
The last work performed by Heartland was on March 26, 1987. On July 16, 1987, Heartland filed its lien statements against Maggie Jones and 95th & Nall.
Approximately one year later, on July 19, 1988, Heartland filed this cause of action to foreclose on the liens. Because Maggie Jones had filed for bankruptcy, it was not served and was only a nominal party to the action. Heartland obtained relief from the automatic bankruptcy stay to pursue this action.
After a bench trial on May 21, 1990, the trial court ruled in favor of Heartland, ordering 95th & Nall to pay “the sum of $104,000, with prejudgment interest of $32,933 thereon for a total judgment of $136,933 plus interest at the legal rate from the date of judgment and for the further sum of $75 for title evidence.” The Court of Appeals affirmed that judgment. We granted review.
The issue before this court is whether Maggie Jones acted as 95th & Nall’s agent. The answer resolves whether the mechanic’s lien filed by Heartland attached to 95th & Nall’s real estate. “A mechanic’s lien is purely a creation of statute, and those claiming such a lien must bring themselves clearly within the provisions of the statute authorizing it.” Lentz Plumbing Co. v. Fee, 235 Kan. 266, 274, 679 P.2d 736 (1984).
Heartland argues that Maggie Jones acted as the agent for 95th & Nall, thus bringing the lien within the purview of K.S.A. 60-1101 and K.S.A. 60-1102. The statutes, in pertinent part, provide:
“Any person furnishing labor, equipment, material, or supplies used or consumed for the improvement of real property, under a contract with the owner or with the trustee, agent or spouse of the owner, shall have a lien upon the property for the labor, equipment, material or supplies furnished, and for the cost of transporting the same.” K.S.A. 60-1101. (Emphasis supplied.)
“Any person claiming a lien on real property, under the provisions of K.S.A. 60-1101, shall file with the clerk of the district court of the county in which property is located, within four (4) months after the date material; equipment or supplies, used or consumed was last furnished or last labor performed under the contract . . . .” K.S.A. 60-1102(a). (Emphasis supplied.)
If Maggie Jones was acting as 95th & Nall’s agent, then K.S.A. 60-1101 governs Heartland’s lien and Heartland had four months to file its lien statement. If K.S.A. 60-1101 governs, then Heartland met its filing deadline.
In Lentz Plumbing Co. v. Fee, 235 Kan. 266, this court addressed mechanics’ liens in the landlord-tenant context. In Lentz, Country Showplace, Inc., a Kansas corporation, leased a building owned by Kenneth Reeves for use as a 3.2 beer tavern. The lease specified that Reeves had to approve any material change to the building in writing and that the tenant was not the landlord’s agent. The corporation authorized the manager of the tavern to convert the tavern into a private club. The manager contracted with several companies to renovate the building. The companies billed Showplace. The manager subsequently absconded with all of Showplace’s movable property, including leasehold improvements. Reeves took possession of the building when Showplace defaulted on rent payments. Showplace eventually filed for bankruptcy.
The trial court refused to enforce the mechanics’ liens against Reeves. The trial court found there was no evidence to support an agency relationship between Reeves, as the landlord, and any of the tenants. Although Reeves knew of the renovation, he had not authorized nor consented to the changes. In affirming the trial court, this court stated:
“The general rule is where a mechanic’s lien arises under a contract with a tenant, such lien attaches to the leasehold or tenant’s estate only, and not to the reversion, fee, or the estate of the landlord. The rights of the mechanic’s lien claimant can rise no higher than those of the person with whom he has contracted or to whom he has furnished labor or materials. .. . Without the authority of the landlord, or his consent, or some act of the landlord to make his estate liable, a tenant cannot charge the land with a lien for labor or materials for constructing or improving a building thereon. [Citation omitted.]” 235 Kan. at 274. (Emphasis supplied.)
“The estate of the owner cannot be subjected to a lien for work done or materials furnished at the instance of the lessee unless the lessee may be regarded as an agent or trustee of the owner. Such may be express ■ or implied from the conduct and acquiescence of the owner and from all the circumstances, which estop [the landlord] from denying the agency. [Citation omitted.]” 235 Kan. at 272. (Emphasis supplied.)
The question then is whether Maggie Jones had express or implied authority to act- as the agent for 95th & Nall. This court’s scope of review is well established:
“Where the trial court has made findings of fact and conclusions of law, the function of this court on appeal is to determine whether the findings are supported by substantial, competent evidence and whether the findings are sufficient to support the trial court’s conclusions of law. In determining whether a trial court’s findings of fact are supported by the evidence, it is not the function of an appellate court to weigh conflicting evidence, pass on the credibility of witnesses or redetermine questions of fact. [Citation omitted.]” Lentz, 235 Kan. at 269.
The trial court never directly addressed whether an agency relationship existed between Maggie Jones and 95th & Nall. As will be discussed later, the trial court apparently based its ruling on a finding of implied agency.
An agent has express authority if “the principal has delegated authority to the agent by words which expressly authorize the agent to do a delegable act.” Mohr v. State Bank of Stanley, 241 Kan. 42, 45, 734 P.2d 1071 (1987). Here, there is no evidence to support an express agency. Article 26 in the lease between Maggie Jones and 95th & Nall specifically stated that “[t]his Lease does not create the relationship of principal and agent . . . the sole relationship between Landlord and Tenant being that of landlord and tenant . . . .” Furthermore, according to testimony at trial, there was no written (or implied) agreement between Maggie Jones and 95th & Nall that Maggie Jones would act as 95th & Nall’s agent. Larry Gaines, President of Maggie Jones, never represented himself or Maggie Jones as the agent of 95th & Nall. Reginald Armstrong, managing partner of 95th & Nall, never authorized Gaines to act as 95th & Nall’s agent. Additionally, Gaines understood from the beginning that Maggie Jones was responsible for paying for improvements to the property.
The evidence does not support a finding of express agency; the question remaining is whether an implied agency existed on these facts.
“On the question of implied agency, it is the manifestation of the alleged principal and agent as between themselves that is decisive, and not the appearance to a third party or what the third party should have known. An agency will not be inferred because a third person assumed that it existed . . .
“Implied agency is based on an implied intention to create an agency. It arises upon facts for which the principal is responsible. It arises when, from the statements and conduct of the parties, it appears that the principal, or the principal and the ‘agent,’ intended to make it appear to others that the acts of the ‘agent’ were authorized by the principal.” 241 Kan. at 46.
95th & Nall argues that because the trial court did not make a specific finding regarding agency, the trial court must have ruled “the landlord’s knowledge of the construction and implied authorization of the work created an agency relationship sufficient to satisfy K.S.A. 60-1101.” The trial court in this case noted:
“The lease itself clearly indicates that the tenant was to take the property as is. It further clearly indicates that the tenant had until October 1, 1986 to complete leasehold improvements that were deemed to be necessary, and a requirement that the tenant obtain the landlord’s approval prior to making changes or improvements. It is clear that the landlord had knowledge of the improvements and granted permission to make the improvements, and that of course is construed according to law.”
The Court of Appeals disputed 95th & Nall’s argument that “Lentz precludes any material improvement to the leased property without prior written permission of the lessor.” 95th & Nall claimed that because it did not give prior written approval, Heartland’s lien did not attach to 95th & Nall’s property. The Court of Appeals incorrectly stated that the lease only required prior approval, not prior written approval. Exhibit B of the lease provided that “Tenant shall obtain Landlord’s approval prior to making said changes or improvements.” Article 29 specified that “[w]henever under this Lease, provision is made for Tenant securing the consent or approval by Landlord, such consent or approval shall be in writing.”
In support of its conclusion that Maggie Jones was acting as the agent of 95th & Nall, the Court of Appeals noted:
“Although the [trial] court did not specifically mention it, the lease in question also included a provision that required the lessee to surrender all improvements to the lessor upon termination of the lease. Since all improvements were to be surrendered under the lease, the lessee becomes the lessor’s agent and a mechanic’s lien can attach to the lessor’s real estate. Lentz, 235 Kan. at 273. Arguably, this is exactly what the district court meant when it held:
“ ‘The Court finds and determines that the owner of the property knew and authorized the building of improvements and within the use and meaning of the lien statutes of the State of Kansas must be held responsible for judgment in this case in the amount of the prayer.’ ”
The lease, however, did not require Maggie Jones to surrender all improvements. Article 23 authorized Maggie Jones to remove any trade fixtures, signs, or carpeting from the premises.
“Article 23. Surrender. . . . On or before the last day of the term or the sooner termination thereof, Tenant shall at its expense, remove its trade fixtures, signs and carpeting from the leased premises and any property not removed shall be deemed abandoned. Any damage caused by Tenant in the removal of such items shall be repaired by and at Tenant’s expense. All alterations, additions, improvements and fixtures (other than Tenant’s trade fixtures, signs and carpeting) which have been installed or made by either Landlord or Tenant upon the leased premises and all hard surface bonded or adhesively affixed flooring shall remain upon and be surrendered with leased premises as a part thereof . . . .”
The Court of Appéáls’ cite to Lentz is evidently in reference to the Lentz court’s discussion of Lumber Co. v. Band Co., 89 Kan. 788, Syl. ¶ 1, 132 Pac. 992 (1913), a case involving a short-term lease in which the tenant could make improvements at the tenant’s expense, but all such improvements became permanent fixtures. Because the landlord benefited from the improvements, this court held that in the context of mechanics’ liens, such a provision made the tenant the landlord’s agent. This court, however, went on to hold that if the tenant is “allowed to remove any other property placed upon the leasehold after the lease had expired,” a different result is reached. Lentz, 235 Kan. at 273. In Lentz, the lessee was to return the property in the same condition as when the lease was executed and could remove “any other property.”
In addition, in the case at hand, unlike Lumber Co., the trial court specifically found that “the landlord did not receive any benefit from the extensive leasehold improvements made.” Thus, Lumber Co. does not control on these facts.
Heartland contends “the Court of Appeals erred when it found that the District Court specifically ruled, ‘the landlord did not receive any benefit from the extensive leasehold improvements made.’ ” Heartland maintains that the actual statement made by the trial court is as follows: “The landlord did receive any benefit from the extensive leasehold improvements made.” (Emphasis added by Heartland.) Heartland does not cite to the record to support its contention. Heartland, however, can be referring only to page three of the Partial Transcript of Proceedings.
The original partial transcript furnished to this court shows the word “not” has been written in by hand and initialed by the official court reporter so that the phrase reads, “The landlord did not receive any benefit . . . .” (Emphasis supplied.) Apparently, Heartland did not receive a corrected copy of the transcript.
The trial court’s conclusion that Heartland’s lien attached to 95th & Nall’s real estate because 95th & Nall knew and authorized Maggie Jones to remodel if it wished to do so is not consistent with Lentz.
“It is not enough that the lessor should merely know that the improvements are being made by the lessee, nor that he should have agreed with him that the repairs or improvements are to be made by the lessee, as that may be done for the convenience of the lessee and not because of any benefit to the lessor or his property. [Citation omitted.] If the lessee acts for himself, no lien will attach to the property of the lessor. But where the owner rents his property to another and stipulates in the lease that improvements may be made on the property by the lessee, and the expense thereof deducted from the rentals to be paid him, the lessee may be regarded as the agent of the owner, and those doing the work and furnishing materials for improving the property will be entitled to a lien on the interest and estate of the lessee and the owner. [Citation omitted.]” 235 Kan. at 272-73.
According to the Lentz court, the crux of the matter is whether the landlord benefited from the improvements. Here, the trial court’s finding that 95th & Nall did not benefit from the renovations is supported by substantial competent evidence. When Maggie Jones went bankrupt, the SBA enforced its secured interest in the improvements through a public auction.
Article 36 of the lease specified that in terms of liens, 95th & Nall would have a subordinate position. This was done so that lessee could obtain an SBA loan. At the time of the sale, the new tenant of the restaurant property made arrangements to buy some of the leasehold improvements from the SBA; the new tenant did not purchase the improvements from 95th & Nall. The SBA also financed the new tenant and when the new tenant subsequently went bankrupt, the SBA again held a public auction. This time, the interior was gutted. The trial court’s finding that 95th & Nall did not benefit from the improvements made to the property is supported by substantial competent evidence.
Heartland next contends that, pursuant to Article 36:
“[t]he lien provision does not extend to any permanent fixtures or permanent improvements to the real estate. . . . The landlord, upon retaking of the premises and determination of the lease, obtained all of the improvements to the real estate. The property was relet with the improvements which included painting, repair to the roof, electrical upgrading, heating and air-conditioning, flood control, handicap installation, repair and improvement of the restrooms, and numerous other items specified in the lien statement. These improvements were to the real estate and attached to it and were not subject to any lien by the SB A.”
Heartland does not cite to the record to support this contention, as required by court rules. We do not find this information in the record before us.
Heartland also argues that Gaines’ testimony supports finding that 95th & Nall assumed authority for the renovations by abating rent while renovations were being completed. Heartland claims Article 3 of the lease provided for abatement of rent. Article 3, in pertinent part, stated:
“Failure of Landlord to deliver possession of the premises at the date hereinabove provided, shall postpone the date of commencement of the term of this Lease and shall extend the date of the end of such term by periods equal to those which shall have elapsed between and including the date hereinabove specified for [commencement] on the date when possession of the premises is delivered by Landlord to Tenant, provided that Tenant may occupy the premises without payment of minimum rent for a period of not to exceed 30 days after written notice from Landlord that the premises are ready for such occupancy, for the sole purpose of the Tenant installing fixture, facilities, mechanical equipment and performing finishing work . . . .”
Gaines testified that 95th & Nall extended the due date for rent payments because the restaurant was not ready to open as scheduled. He did not remember how much time was involved, but testified Maggie Jones paid rent before the restaurant opened.
95th & Nall did not assume authority for payment of the renovations by abating rent. Article 1 specified that Maggie Jones agreed to pay the designated rent without “set-off or deduction.” Exhibit B to the lease specified that Maggie Jones accepted the premises “as is” and that Maggie Jones solely was responsible for renovation costs. Article 17 also provided that Maggie Jones would pay all renovation costs.
The record does not support a finding that by their statements and conduct, 95th & Nall, or 95th & Nall and Maggie Jones, intended to create an agency. Additionally, neither apparent agency nor equitable estoppel are applicable here.
“Apparent [or ostensible] agency is based on intentional actions or words of the principal toward third parties which reasonably induce or permit third parties to believe that an agency relationship exists.” Mohr, 241 Kan. at 46.
“A party asserting equitable estoppel must show that another party, by its acts, representations, admissions, or silence when it had a duty to speak, induced it to believe certain facts existed. It must also show it rightfully relied and acted upon such belief and would now be prejudiced if the other party were permitted to deny the existence of such facts.” Lines v. City of Topeka, 223 Kan. 772, Syl. ¶ 4, 577 P.2d 42 (1978).
See Osborne v. City of Manhattan, 244 Kan. 107, 110, 765 P.2d 1100 (1988).
Mike White, a general contractor doing business as Heartland, testified he negotiated and contracted with Gaines for Heartland to do the remodeling. White did not negotiate with 95th & Nall. White did not ask 95th & Nall to approve any of the work. Any payments Heartland or subcontractors received were received from Maggie Jones. In fact, 95th & Náll only became aware that Heartland was doing the renovation work when the work was halfway completed.
White testified he discussed work with Armstrong regarding an exterior paint job. (The lease specified that 95th & Nall was responsible for this work.) That discussion involved both Gaines and Armstrong. Gaines, not Armstrong, authorized White to go ahead with the paint job, which only cost a few hundred dollars. Armstrong subsequently reimbursed Maggie Jones for the paint job, and Maggie Jones paid Heartland. Armstrong did not remember the conversation with White.
White, as Heartland’s representative, was not induced to enter into the contract with Maggie Jones.because of an alleged agency. White also did not rely in any-way upon an alleged agency. White never saw the lease between Maggie Jones and 95th & Nall.
Although agency also can be .established by ratification, the record does not support such a finding. 95th & Nall did not ratify the contract between Maggie Jones and Heartland. See Rogers v. Beiderwell, 175 Kan. 223, Syl. ¶ 4, 262 P.2d 814 (1953) (ratification defined).
There is not substantial competent evidence to support a finding that Maggie Jones acted as the agent for 95th & Nall. Consequently, the trial court’s and the Court of Appeals’ conclusions of law are erroneous. ’
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The opinion of the court was delivered by
McFarland, J.:
This is an action by beneficiaries of a trust for recovery of damages for oil and gas investments made by the Trust.
The case before us was determined in a bench trial and involves a very complex factual situation as witnessed by the trial court’s entry of over 200 findings of fact. A highly summarized statement of the facts is as follows. Warren Brown was a wealthy Wichita businessman. In 1956, Mr. Brown created two revocable inter vivos trusts. His two children, Dorothy Brown Wofford and Pauline Brown Gillespie, were the co-trustees of each trust. In the trust instruments, the trustees were vested with full legal and equitable title to the trust property; the effect of such language will be discussed in the standing issue of this opinion. Broad powers were granted to the trustees as to the investment of trust property, to-wit:
“(g) The Trustees may invest, reinvest, and keep invested the trust estate and all property from time to time remaining in and comprising the same, in any or every kind of property, whether real or personal, tangible or intangible, and wheresoever situated, as the Trustees in their discretion deem advisable, without regard to whether any such investments are authorized by any law, rule, statute, regulation, or custom pertaining to the investment of trust funds by Trustees, intending hereby to empower the Trustees to be guided solely by what in their discretion is deemed to be for the best interests of the trust estate.”
The two trusts held substantially equal assets of stocks, bonds, and bank stock. Warren Brown died shortly after the creation of the trusts. The assets of each trust were initially valued at $392,015. The Internal Revenue Service later reappraised the assets at $1,647,687.66, resulting in additional estate taxes being paid by each trust of $700,000.
Each of the co-trustee daughters was in her 60’s when the trusts were created. One of the trusts was for the benefit of Wofford and her four children (Wofford Trust), and the other was for the benefit of Gillespie and her two children (Gillespie Trust). With the approval of Wofford (or her successor trustee), Gillespie could withdraw any or all income as well as the corpus of the Gillespie Trust. Wofford had like rights in the Wofford Trust. After the death of Warren Brown, Gillespie was the dominant figure in the investment of trust assets held by each trust.
In 1973, Wofford died and the Wofford Trust terminated, with the trust assets being distributed among Wofford’s four children. At that time, each trust had a value of approximately $3,000,000. Pursuant to the terms of the Gillespie Trust, Dorothea Wofford Seymour (Wofford’s daughter) succeeded as co-trustee of the Gillespie Trust.
We turn now to how oil and gas investments became involved. Gillespie had been making personal investments in oil and gas interests dating at least from the early 1950’s. In the late 1950’s Dorothea Wofford Seymour (Dorothea) and her husband, Paul Seymour, Jr. (Seymour), created a corporation, Arrowhead Petroleum, Inc. (Arrowhead). Dorothea owned 49 percent of the stock and Seymour owned the remaining 51 percent. Seymour managed the company. Shortly after the creation of Arrowhead, Gillespie commenced making her personal oil and gas investments exclusively with Arrowhead. Gillespie was concerned over the amount of income tax each trust was paying on its investment profits. In 1965, each trust’s tax liability was over $67,000. Gillespie kept the records on each trust with the assistance of accountants and made the final decision on investments for the trusts, although approval therefor was required by her co-trustee (Wofford and, later, Dorothea). The co-trustee deferred to Gillespie’s judgment in these matters.
In 1965, to reduce income tax liability, each trust began investing in oil and gas interests. All such investments were through Arrowhead. The investments of each trust with Arrowhead were $34,626.29 in 1965. Dorothea did not participate in the management of Arrowhead. Oil and gas investments were made on the basis of discussions and negotiations between Gillespie and Seymour with some involvement by certain accountants (the nature and extent of such involvement will not be discussed in any detail as the same is the subject of a yet to be determined aspect of this litigation, as will be set forth later in the opinion). All trust checks required the signature of both trustees. Between 1965 and 1973, each trust paid Arrowhead exactly the same amounts on the same dates and received the same interests in the same leases. In 1968, Gillespie determined that in order to achieve maximum tax benefits from the oil and gas investments for the two trusts, it would be best to make block investments with Arrowhead of amounts determined early in each calendar year. All block investments were from trust income. An attorney and an accountant were consulted who saw no problem with this procedure. Under the block investment program, any excess remaining at the end of the year was to be applied to wells drilled rather than returned to its respective trust.
As previously stated, Wofford died in 1973 and Dorothea succeeded her at that time as co-trustee of the Gillespie Trust (hereafter, Trust). The Wofford Trust was terminated. The continuing Trust made block investments with Arrowhead between 1974 and 1987 of yearly amounts ranging from $110,000 to $300,000.
In the winter of 1987, the plaintiffs herein, Warren Brown Gillespie and Polly Gillespie Townsend (children of Gillespie) brought an action against Dorothea as co-trustee seeking an accounting of the Trust’s investments with Arrowhead. On February 2, 1988, Gillespie died at age 92. At the time of her death, the Gillespie Trust contained assets in excess of $11,000,000. On June 27, 1988, the petition was amended, seeking compensatory and punitive damages from Dorothea, individually and as co-trustee, Seymour, Paul Seymour, III, Arrowhead, Big Springs Drilling, Inc. (Big Springs Drilling), Ruth Bassett, Robert W. Burdge, and Grant-Thornton (an accounting partnership) arising from alleged mismanagement of Trust funds invested in Arrowhead.
The trial court dismissed the claims against defendants Burdge and Grant-Thornton and certified the judgment to be final pursuant to K.S.A. 1990 Supp. 60-254(b). The plaintiffs appealed therefrom. The Court of Appeals affirmed in part, reversed in part, and remanded the case for further proceedings. Specifically, the Court of Appeals held that a cause of action had been stated for “breach of trust against the accountants for conspiracy to overcharge the trust account and participation in overcharging the account.” Gillespie v. Seymour, 14 Kan. App. 2d 563, 572, 796 P.2d 1060 (1990). No further action has apparently been taken in that matter; presumably, it is waiting resolution of this appeal.
The trial court herein held that by virtue of assorted wrongdoings by the defendants, the Trust had been damaged in the amount of $2,476,422. To this, the trial court added tax allowances of $843,607 for a total judgment of $3,320,029 through December 31, 1987. Between said date and the date of judgment (December 14, 1990) interest was allowed on the judgment in amounts ranging from 9.5 percent to 11 percent. The aggregate judgment was in excess of $4,000,000. Dorothea, Seymour, and Arrowhead were held to be jointly and severally liable on the entire amount. Paul Seymour, III, was held jointly and severally liable for 87.92 percent of the total damages.
Additionally, punitive damages for the period prior to July 1, 1987, were assessed as follows;
Dorothea: $2,000,000
Seymour: $2,000,000..
Paul Seymour, III: $ 25,000.
For the period after July 1, 1987, punitive damages were awarded as follows:
Dorothea and Seymour,
jointly and severally: $ 89,250
Additionally, there were some allowances involving some billings among Gillespie’s estate, Big Springs Drilling, and Arrowhead which are comparatively small in amount and are not at issue herein. The judgment was certified as a final judgment pursuant to K.S.A. 1990 Supp. 60-254(b). Defendants Dorothea, Seymour, Paul Seymour, III, Arrowhead, and Big Springs Drill ing appealed from the judgment. The plaintiffs have filed a cross-appeal.
The foregoing statement of facts, although lengthy, provides just the framework of the background giving rise to these appeals. Additional factual details will be set forth as necessary for the discussion of particular issues.
Before proceeding to the issues, the applicable scope of review needs to be stated. As we held in Williams Telecommunications v. Gragg, 242 Kan. 675, 676, 750 P.2d 398 (1988):
“Where the trial court has made findings of fact and conclusions of law, the function of this court on appeal is to determine whether the findings are supported by substantial competent evidence and whether the findings are sufficient to support the trial court’s conclusions of law. Moore v. R. Z. Sims Chevrolet-Subaru, Inc., 241 Kan. 542, Syl. ¶ 3, 738 P.2d 852 (1987); Friedman v. Alliance Ins. Co., 240 Kan. 229, Syl. ¶ 4, 729 P.2d 1160 (1986). Substantial evidence is evidence which possesses both relevance and substance and which furnishes a substantial basis of fact from which the issues can reasonably be resolved. Wooderson v. Ortho Pharmaceutical Corp., 235 Kan. 387, Syl. ¶ 2, 681 P.2d 1038, cert. denied 469 U.S. 965 (1984). Stated in another way, ‘substantial evidence’ is such legal and relevant evidence as a reasonable person might accept as being sufficient to support a conclusion. Kansas Dept. of Health & Environment v. Banks, 230 Kan. 169, 172, 630 P.2d 1131 (1981).”
This court’s review of conclusions of law is unlimited. U.S.D. No. 352 v. NEA-Goodland, 246 Kan. 137, 140, 785 P.2d 993 (1990).
ESTOPPEL
For their first issue on appeal, defendants contend the trial court erred in not concluding that the plaintiffs’ claims were barred by the doctrine of estoppel.
Equitable estoppel is the effect of the voluntary conduct of a party whereby it is precluded, both at law and in equity, from asserting rights against another person relying on such conduct. A party seeking to invoke equitable estoppel müst show that the acts, representations, admissions, or silence of another party (when it had a duty to speak) induced the first party to believe certain facts existed. There must also be a showing the first party rightfully relied and acted upon such belief and would now be prejudiced if the other party were permitted to deny the existence of such facts. There can be no equitable estoppel if any ■ essential element thereof is lacking or is not satisfactorily proved. Estoppel will not be deemed to arise from facts which are ambiguous' and subject to more than one construction. Ram Co. v. Estate of Kobbeman, 236 Kan. 751, Syl. ¶¶ 4, 5, 696 P.2d 936 (1985). A party may not properly base a claim of estoppel in its favor on its own wrongful act or dereliction of duty, or for acts or omissions induced by its own conduct. Wichita Fed’l Savings & Loan Ass’n v. Black, 245 Kan. 523, Syl. ¶ 7, 781 P.2d 707 (1989).
The defendants’ position on this issue is stated in their brief as follows:
“[B]ecause Pauline Gillespie, who was both a trustee and a' beneficiary, actually made and approved each of the Arrowhead investments, and waived the accounts receivable, the doctrine of estoppel bars plaintiffs’ claims.
“The general rule is that a beneficiary of a trust who consents to or approves of an act, omission, or transaction by the trustee is precludéd from subsequently objecting to the impropriety/ of such act, omission, or transaction, and cannot hold the trustee liable for any loss resulting from the act or omission, even though the conduct of the trustee may constitute a breach of duty in the administration of the trust. Restatement (Second) of Trusts § 216 (‘[A] beneficiary cannot hold the trustee liable for an act or omission of the trustee as a breach of trust if the beneficiary prior to or at the time of the act or omission consented to it.’). Accord G. Bogert, The Law of Trusts and Trustees § 941 (1986) (equity will not permit the beneficiary to claim breach of trust by the trustee, if the beneficiary consented to the breach of trust, or participated in the breach). This rule applies with even more force to beneficiaries who are also co-trustees. See Scullin v. Clark, 242 S.W.2d 542 (Mo. 1951) (co-trustee and life beneficiary approved allocation of assets to corpus rather than incomé; personal representative of life beneficiary/co-trustee precluded from maintaining action for improper allocation of assets).
“Pauline Gillespie not only consented to and approved of the Arrowhead investments, she initiated each of the investments, and every payment to Arrowhead was made at her express direction. Obviously, Pauline Gillespie was estopped from holding Dorothea Seymour liable for those investments. Because plaintiffs receive their interest in the remainder through Pauline Gillespie, their claims are also precluded by the doctrine of estoppel.
“A decision squarely on point is In Re Perkins’ Trust Estate, 314 Pa. 49, 170 A. 255 (1934). In that case, the lifetime beneficiary was entitled to the net income of the trust. At his death, the principal was to be distributed as he appointed. He directed that the principal would go to his wife or other contingent remaindermen. During his life, the income beneficiary prevailed upon the trustees to invest trust funds in various unsuccessful business transactions in which he had a personal interest. After "the death of the lifetime beneficiary, the contingent remaindermen sought to hold the trustees liable for the loss of trust funds.
“The court recognized that the investments were ‘absolutely indefensible.’ However, the court held that a life tenant with a power of appointment has an interest tantamount to a fee, and that, if the life tenant was content with the investments, his remaindermen would not be heard to complain. As aptly put by the court:
‘Since [the lifetime beneficiary] did not, and in fact, could not have had the trustees surcharged in his lifetime, his appointee widow is accordingly now estopped from seeking such surcharge against the trustees. Likewise the contingent legatees under the will of [the lifetime beneficiary] . . . are in the same situation. These legatees owe their interest ... to the life tenant through his power of absolute appointment. As he . . . was estopped, so are those who claim through him. . . . The principle involved in this case is well summed up by the auditing judge when he says that it is “unfair and unjust to permit a person to induce the making of investments — however unwise — and then to permit him, or any person or persons claiming through or under him, to repudiate such investments and to benefit thereby.” ’ (emphasis added)
Id. at 51. See also Restatement (Second) of Trusts § 216, comment h (if beneficiary consents to breach of trust, persons who take title through that beneficiary are barred from holding the trustee liable). Because the co-trustees held the legal and equitable title to all trust assets and could, without restriction and at any time, distribute all or any part of the principal and income to Pauline Gillespie, she possessed what amounted to an absolute power of appointment. During her lifetime, plaintiffs’ interest in the remainder could have been eliminated by the stroke of a pen, and there is nothing the remaindermen could have done to prevent it. Pauline Gillespie exercised her de facto power of appointment in favor of the plaintiffs by choosing to leave more than $11,300,000 in the trust, and they received those funds only as a result of her decision not to take all of the trust assets. Because Pauline Gillespie could affect plaintiffs’ interest in the trust, they are bound by her decisions. See G. Bogert, The Law of Trusts and Trustees § 941, at 460 (1986).
“The doctrine of estoppel directs an eminently fair result in this case. The trial court found that Pauline Gillespie made all of the decisions regarding the trust management and investments. (Finding of Fact ¶ 135). Her children, who benefited substantially from those decisions, should not be permitted to take the benefit of her profitable decisions while disclaiming, after the fact, her unprofitable decisions. Neither should Dorothea Seymour, who relied on Pauline Gillespie’s approval of the investments, be held liable because plaintiffs, who had no interest in or title to the trust assets, do not now approve of their mother’s decisions.”
We have no quarrel with the legal doctrines from the treatises quoted by the defendants or the rationale expressed in Perkins’s Trust Estate, 314 Pa. 49, 170 A. 255 (1934). The difficulty is that they are inapplicable herein.
Gillespie was a co-trustee and a beneficiary of the Trust. She could have received income or all or part of the corpus of the Trust as a beneficiary, but she did not. Throughout the entire 31-year existence of the Trust, no Trust assets or income were transferred to her as a beneficiary. In all of her dealings with Trust assets, income, and investments, she was acting as a co-trustee.
Plaintiffs’ interests in the Trust, like Gillespie’s, were established by Warren Rrown, the settlor. Plaintiffs’ interests, accordingly, do not arise from a power of appointment granted to Gillespie and hence do not arise from or flow through Gillespie. Even assuming Gillespie might have been estopped to bring an action against Dorothea, her co-trustee, this cannot affect plaintiffs’ rights to bring this action. The plaintiffs herein did not induce the co-trustees to invest in Arrowhead. The trial court found that neither of the plaintiffs knew such investments were being made until August of 1987, when Warren Rrown Gillespie saw a Trust bank statement showing checks had been written to Arrowhead.
Additionally, the trial court found that Gillespie was unaware that Seymour was overcharging the Trust for drilling expenses and allocating to the Trust, after the fact, worthless interests in dry holes.
There is no basis for application of the doctrine of estoppel herein. Defendants have not shown that Gillespie or plaintiffs induced Seymour to overcharge the Trust for drilling expenses or caused the alleged wrongful allocation of Trust interests in oil and gas leases.
This issue is without merit.
STATUTE OF LIMITATIONS AND DOCTRINE OF LACHES
The plaintiffs sought and received damages for acts occurring from 1974 through 1987. Defendants contend that K.S.A. 60-513 bars any claims arising from acts occurring more than two years prior to the filing of the action herein. The trial court held that the • plaintiffs’ cause of action accrued in August of 1987 when plaintiffs learned the Trust was investing in Arrowhead. Here, again, the defendants attempt to equate plaintiffs’ rights with those of Gillespie — specifically, that plaintiffs’ rights to the cause of action herein are identical with Gillespie’s and that accrual and barring questions are determined by the time frame in which Gillespie could have maintained the action.
In Hart v. Bank, 105 Kan. 434, 185 Pac. 1 (1919), the original trustee of a testamentary trust disposed of trust assets under highly questionable circumstances. The successor trustee was aware of the situation and took no action against the trustee or the receiver of the assets (defendant bank). When the minor beneficiaries of the trust attained the age of 25 years and were entitled to the trust assets, they discovered the alleged wrongdoing and brought an action against the bank. This court held that because the successor trustee knew of the breach of trust and let the statute of limitations run, the beneficiaries were barred. 105 Kan. at 440. The gravamen of the claims before us is that the defendants misapplied the Trust’s investments by overcharging the Trust for drilling expenses and improperly allocating oil and gas interests to it. The trial court found Gillespie had no knowledge of what it characterized as the “finagling” of Trust investments.
The trial court’s determination that Gillespie had no knowledge of Seymour’s “finagling” is supported by substantial competent evidence and, accordingly, cannot be disturbed upon appeal. So, even if Gillespie’s knowledge could have triggered the running of the statute of limitations and plaintiffs are bound thereby, she did not have such knowledge.
Under the trial court’s findings, the concealed finagling only came to light upon plaintiffs’ 1987 and 1988 investigation of the Arrowhead investments. At that time the wrongful acts and the resultant injury were ascertained.
An argument could be made that plaintiffs’ rights could have accrued only after Pauline’s death as, prior to that time, the entire Trust estate could have been transferred to Gillespie. Had that occurred, plaintiffs, obviously, would have had no justiciable interest in how Trust assets had been invested or sustained any injury for mismanagement thereof. This is so because the Trust provided no means or circumstances under which Trust assets could have been distributed to plaintiffs during Gillespie’s lifetime. Their interest was only in the Trust assets remaining at Gillespie’s death when the Trust terminated. Their claim herein, however, is predicated on the diminution in value of the assets received by them in 1988 as a result of the prior finagling.
However, this issue need not be determined, as the prior holding resolves the statute of limitations question.
Defendants also argue plaintiffs’ claim is barred by the doctrine of laches.
The doctrine of laches is an equitable principle designed to bar stale claims. Dutoit v. Board of Johnson County Commr's, 233 Kan. 995, 1001, 667 P.2d 879 (1983). Relief is denied on the ground of laches when a party neglects to assert a right or claim for an unreasonable and unexplained length of time and the lapse of time and other circumstances cause prejudice to the adverse party. Capitol Fed’l Savings & Loan Ass’n v. Glenwood Manor, Inc., 235 Kan. 935, 938, 686 P.2d 853 (1984); Kirsch v. City of Abilene, 210 Kan. 749, 751-52, 244 Pac. 1054 (1926). The mere passage of time, however, is not enough to invoke the doctrine of laches. Ten Eyck v. Harp, 197 Kan. 529, 534, 419 P.2d 922 (1966). For laches to apply, the court must consider the circumstances surrounding the filing of the suit and any disadvantage to the other party caused by the plaintiff s delay. Dutoit v. Board of Johnson County Commr's, 233 Kan. at 1001; Potucek v. Potucek, 11 Kan. App. 2d 254, 260, 719 P.2d 14 (1986).
The plaintiffs herein moved promptly to bring this action upon learning of the facts, as previously stated. Gillespie’s failure to bring the action cannot be utilized to bar the plaintiffs from bringing the action herein. We find no merit in this' issue.
STANDING
For their next issue, defendants contend the trial court erred in concluding the plaintiffs have standing to bring this action. They base this issue on language in the Trust instrument which states:
“(d) The Trustees are vested with full and complete legal and equitable title to all of the property and estate hereby transferred and entrusted to them until the termination of such trust and until such trust property shall be actually paid over, transferred and delivered to the person or persons designated as beneficiaries hereunder. No person entitled as beneficiary hereunder — either to the body or corpus of said property upon the termination of said trust or to the income, increase or increments thereof or therefrom during the continuance thereof — shall individually take or have any title to or interest in such body or corpus or income, increase or increments until the same shall be actually received in possession by any such beneficiary. No disposition, charge or encumbrance by way of anticipation of such trust property or estate Or otherwise or the income, increase or increments therefrom, or any part of the trust estate, by any person who may be designated as or become beneficiary hereunder, shall be of any validity or legal effect, or be in anywise regarded by said Trustees, nor (until actually and individually received in possession by any such beneficiary) shall the interest óf ány beneficiary be in any way liable for or subject to any claim or lien of any creditor or of any other person to whom such beneficiary may be, or claimed to be, in any way obligated or liable.”
Defendants argue that as under the Trust instrument both legal and equitable title were vested in the trustees, plaintiffs had no claim of ownership when the investments were made in Arrowhead. Accordingly, they have no claim of ownership .upon which to base this action.
In Blackwell v. Blackwell, 88 Kan. 495, Syl. ¶ 1, 129 Pac. 173 (1913), this court said, “A trust in real estate implies a holding of the legal title by one for the benefit of another who holds equitable title.” This is supported by the Restatement (Second) of Trusts § 2 (1957) which defines what a trust is:
“A trust, as the term is used in the Restatement of this Subject, when not qualified by the word ‘charitable,’ ‘resulting’ or ‘constructive,’ is a fiduciary relationship with respect to property, subjecting the person by whom the title to the property is held to equitable duties to deal with the property for the benefit of another person, which arises as a result of a manifestation of an intention to create it.”
Comment (f) to this section provides:
“In a trust there is a separation of interests in the subject matter of the trust, the beneficiary having an equitable interest and the trustee having an interest which is normally a legal interest.”
Restatement (Second) of Trusts § 341 (1957) provides:
“(1) Except as stated in Subsection (2), if the legal title to the trust property and the entire beneficial interest become united in one person who is not under an incapacity, the trust terminates.”
Appellants suggest the doctrine of merger applies.
Merger was discussed in Fry v. McCormick, 170 Kan. 741, 228 P.2d 727 (1951), in which this court held that the same person cannot be at the same time sole trustee and sole beneficiary of the same identical interest, and that a trust cannot exist where the legal and beneficial interests are in the same person. The court concluded, however, that this rule does not apply to a situation where several beneficiaries of a trust, whose interests therein are not common to each other, are also trustees. This court reasoned that each is a beneficiary for the other’s interests, which separates legal and equitable title. 170 Kan. at 742-43.
Throughout the trust instrument, the term “beneficiaries” is used rather than “beneficiary.” Yet, by its terms, only Gillespie can receive trust assets or income (with the approval of the co-trustee). Plaintiffs herein receive only trust assets remaining after the Trust terminates upon the death of Gillespie. Yet, the modification of the Trust instrument executed shortly after the execution of the Trust states:
“WHEREAS, under date of April 20, 1956, Warren E. Brown as Settlor and Warren E. Brown, Pauline Brown Gillespie and Dorothea Brown Wofford as Trustees entered into a certain Trust Indenture primarily for the benefit of the children of Pauline Brown Gillespie as provided in paragraph (c), Item Three thereof . . . .” (Emphasis added.)
The Trust herein operated as, and was treated as, a trust during the 30-plus years of its existence. It appears rather late for a claim to be made that it never truly was a trust because legal and equitable title was vested in the trustees. Despite the odd language concerning the vesting of legal and equitable title in the trustee, we agree with the trial court that it was a valid trust and that plaintiffs have sufficient interest as beneficiaries and/or remaindermen to bring this action.
EFFECT OF PRIOR COURT OF APPEALS DECISION
The defendants contend that the prior Court of Appeals decision herein, relative to plaintiffs’ claims against the defendant accountants, decided some issues in their favor. The prior decision, Gillespie v. Seymour, 14 Kan. App. 2d 563, 796 P.2d 1060 (1990), involved plaintiffs’ appeal from the trial court’s dismissal of their claims against the defendant accountants therein. The case before us was tried in March 1990. The Court of Appeals decision was filed on May 4, 1990. Plaintiffs contend the Court of Appeals decision limits any judgment against defendants herein to recovery for overcharges of expenses. We do not agree.
The claims against the defendants are broader than those against the accountants. Liability of the accountants is predicated upon alleged overcharging of expenses to the estate, and recovery of damages was sought on several theories. Liability on contract was rejected as there was no contractual relationship between the plaintiffs and the accountants. Conversion was held to be not viable as plaintiffs had no right of possession in the trust funds. The Court of Appeals held: “The Reneficiaries may, however, maintain an action for breach of trust against the Accountants for conspiracy to overcharge the trust account and participation in overcharging the account.” 14 Kan. App. 2d at 572.
In the case before us, overcharging the trust account is only a portion of the claim. The trial court found, in essence, that Seymour systematically engaged in a plan to allocate worthless or low value oil and gas interests to the Trust in exchange for its investments in the company he dominated, Arrowhead. In so doing, he assigned to his wife (Dorothea) and other favored entities the more valuable interests. The claim against Dorothea arises from her fiduciary duties as co-trustee and alleged involvement in a conspiracy. We find nothing in the Court of Appeals decision which restricts or limits the judgment entered herein.
PAUL SEYMOUR, III
Appellants contend that no basis for liability against Paul Seymour, III, was established. Paul Seymour, III, is the son of Dorothea and Seymour.
The trial court made the following pertinent findings of fact:
“54. Seymour selected wells for Dorothea, Paul Seymour III . . . and himself and selected the percentages. Seymour decided who among the Arrowhead and Big Springs . . . employees and shareholders would receive a carried interest on a well, but made no written record of it. Seymour III is not liable for any losses to Trust until he joined Arrowhead and Big Springs. This occurred in the summer of 1979.
“88. Seymour owned a majority interest in Big Springs and received a salary from it. Seymour was president from 1978-1984. Although Paul Seymour, III was president from 1985 through 1988, it was under the overall dominance of Seymour.
“100. Seymour and Paul III made the entries of percentages of well ownership on the 1984 spreadsheet. The money in excess of ‘proportionate’ billings was allocated by Seymour, Paul III and Burdge.
“212. Seymour III was aware of, participated in, and continued to justify the spreading of funds, adjustment of interests and over billings at all times, including during the trial of the case. He testified in effect, ‘that anything goes in the oil business.’ This position is contrary to the statement by the expert witness, Remshberg, ‘of conducting prudent operating practices and procedures, as well as maintaining fiduciary responsibilities.’ ”
Big Springs Drilling was organized in 1977.
As to the compensatory damages entered against Seymour III the trial court held:
“The Court, therefore, finds that Dorothea Wofford Seymour, Paul A. Seymour Jr., Paul Seymour, III and Arrowhead Petroleum, Inc. are culpable as conspirators and are jointly and severally liable for damages assessed herein by the Court; provided, however, that Paul Seymour, III, shall be assessed no liability for any year prior to 1979, the Court finding his having commenced employment with Arrowhead Petroleum, Inc. and Big Springs Drilling, Inc. in the summer of 1979. For purposes of determining the liability of Paul Seymour, III, the Court finds that 12.08 percent of the plaintiffs’ damages under the Court’s computation had accrued during the years from -1974 through 1978 and that, therefore, his joint and several liability is limited to 87.92% of the total damages assessed by the Court.”
The issue of the sufficiency of the evidence supporting entry of the judgment for compensatory damages against Seymour III is a close one. Over and over in the trial court’s findings we have the picture of Seymour being the orchestrator of the wrongdoing. He is the finagler in the allocation of the Trust’s investments in oil and gas interests. He is the individual who determined the overcharging of the expenses to the Trust. The defendants characterize Seymour Ill’s role as a clerical one. He was simply following the instructions of his father, Seymour. The trial court, however, found he was a participant in the wrongdoing and a fellow conspirator with Seymour. With due regard for the limited role an appellate court plays in reversing a trial court’s findings of fact, we conclude that no error has been demonstrated in this issue.
EXPERT WITNESS
In this issue, defendants argue as follows:
“Plaintiffs’ accounting expert, Gary Gibbs, submitted his expert report to defendants in October of 1989, in accordance with the scheduling order of the trial court. Defendants’ accounting expert, J. Fred Kubik, evaluated that report and assisted defendants in identifying mistakes and conceptual points of dispute. Gibbs was deposed on February 21, 22, and 23, just days before trial began on March 6, 1990. At that time, he did not amend or add to his October 17 report.
“Late in the afternoon of Sunday, March 4, just two days before trial, counsel for plaintiffs hand delivered Gibbs’ new expert report to counsel for defendants. The new report contained extremely damaging conclusions and misinformation, but, because of the impending trial, defendants were precluded from digesting, evaluating, and responding adequately. Although defendants strenuously objected to the admission of the new report, the trial court admitted it into evidence.”
Defendants then point out an error in the revised report.
Plaintiffs contend that defendants did not object to the report itself (Exhibit 77) at trial and only objected to a yearly summary gleaned therefrom (Exhibit 78). The objection and the ruling thereon were as follows:
“It is sort of a written series of opinions and observations that are in addition to what he testified to and the (sic) tends to over-emphasize it and adds new material.
“THE COURT: Well, I will receive it for what it is worth.”
In their reply brief, defendants admit they did not object to Exhibit 77, but contend the admission of Exhibit 78 was erroneous.
The admission of expert testimony lies within the sound discretion of the trial court. Holly Energy, Inc. v. Patrick, 239 Kan. 528, Syl. ¶ 3, 722 P.2d 1073 (1986).
We find no abuse of discretion in the particulars alleged.
COMPENSATORY DAMAGE AWARD
The method used by the trial court in determining compensatory damages is challenged in both the appeal and the cross-appeal.
Before proceeding to the parties’ particular complaints concerning the method of computation utilized, a discussion of the problems present in this case which complicated the computation of damages and the method selected by the trial court to accomplish the same is appropriate. Reduced to its barest terms, the plaintiffs’ claim is that the estate received less than that for which it bargained. By virtue of being overcharged on expenses and Seymour’s finangling in the allocation of the Trust’s interest in leases, the Trust received less than it should have for its investment. Ordinarily, damages would be calculated by awarding to the plaintiffs the benefit of the bargain. That concept is fraught with problems in the case herein. Many records are available as to what the Trust invested, what expenses it was charged, and what interests it received. But at the heart of the claims herein is the disparity between what the Trust paid for expenses and the interests received as compared with what other investors paid for expenses and the interests they received.
Over the 14-year period herein, many different wells and many different investors and combinations of investors were involved. Records on these other investors are, in substantial part, unavailable as they were not maintained by Arrowhead. Further, the inherently risky nature of oil and gas investments makes comparisons difficult. There is a substantial chance factor. Because of the way Seymour handled the Trust’s block investments, such as allocating a leasehold interest to the Trust after a dry hole had been drilled, the deck was stacked against the Trust, negating the chancé factor. But some other investors, including Seymour and members of his family, had their risk reduced by this same finagling. Figuring damages on a transaction-by-transaction basis in comparison to other Arrowhead investors would be, under the circumstances, a formidable and probably impossible task by virtue of the lack of records and the risk or luck factor.
The trial court’s findings include many specific instances in which the Trust’s block investments were improperly charged by Seymour. It found that Arrowhead billed its working interest holders disproportionately 95 percent of the time. Illustrative of disparity in the assignment of interests is the fact that the Trust had two producers in 130 wells while Seymour had 19 producers in 103 wells, and Dorothea had 10 producers in 40 wells. Finding No. 93 is illustrative of the situation, reproduced in part as follows:
“Most striking is the 28-well Dean Miller venture in which Trust and Pauline cumulatively were in all of the 19 dry holes but not a single producer, while Seymour was in each of the nine producing wells but only one dry hole. This is true notwithstanding Seymour’s testimony that each well was discussed before drilling.”
In its award of damages, the trial court stated:
“1. Computation of damages is always a problem. Classically, and traditionally, tax considerations do not figure into a determination of damages. Trust was ravaged by the fashion in which the so-called block investment plan was administered. The Court determines that this administration was so bad and so blatant that all of the investments are to be treated as void at the time they were made. If Trust had not made block investments, those funds would have been subject to tax at the maximum combined rate deduction of tax which leaves an amount available for investment. The Court finds that had Seymour not been in the oil business, trust funds would have been invested as other trust funds. Such investments had an average year return, according to Gibbs, of 13.948% for each year. The Court determines that such funds would have been available for one-half year for investment. Then after the first year there was a principal amount available for investment the entire year with the expected return of 13.948%. In addition, there was a new amount available for investment for one-half year.
“2. This compounding of return is stopped with the end of 1987. Gillespie died in February, 1988. At this time, the total of the block investment’s computed return is $2,477,422 (all figures being rounded according to the nearest dollar). Since the recovery is subject to tax the amount of ‘block investments’ after taxes must be increased by an amount which will return that amount to plaintiffs since, for computation purposes, the tax has already been paid but there is no basis recognizable by the IRS in the damage recovery. This amount is figured by the following formula:
X - .4343 X = $1,098,848.
“X is an amount which, when subjected to the combined tax rate, stated as a decimal, .4343 will give the total amount of block investments after taxes. Therefore, $843,607 is to be added to the following computations of damages. The computation of damages is as follows: [*The chart is reproduced as an appendix to this opinion.]
“3. Therefore, damages are the total of $2,476,422 plus tax allowances on funds discounted for past taxes of $843,607 for total damages of $3,320,029.00. Interest is to be computed at the statutory rate from and after January 1, 1988.”
In essence, the trial court voided all the Trust’s Arrowhead investments from and after 1974, took off the tax savings made each year as a result of the investments, computed what the Trust would have made in the after-tax investments of part of the Trust’s stock and bond portfolio, and allowed for income tax on the judgment. This, the trial court concluded, would make the Trust whole for the damage it had sustained.
Defendants complain that the measure of damages was improper in a number of respects. First, they argue that the trial court was imposing the prudent man rule on a trust that by its express language granted unlimited discretion in the investments, The trial court did not void the investments because they were in oil and gas, but rather on the basis of the misuse of the block investments. In essence, it held the Trust was systematically cheated in the way Arrowhead and Seymour applied the investment funds. There is no finding the Trust lacked authority to make oil and gas investments.
Next, the award is challenged on the basis it is pure speculation that had oil and gas investments not been made with Arrowhead, then the after-tax dollars would have been invested in stocks and bonds. The Trust had, essentially, three types of investments during the period in question: (1) stocks and bonds; (2) bank stock; and (3) oil and gas through Arrowhead. After-tax profits from (1) and (2) were reinvested in (1) and (3). We do not believe it is too speculative to assume if investments in Arrowhead had ceased, all after-tax profits would have been treated the same. The rate of return on such investments was an established average of 13.948 percent. The defendants characterize this as an award of prejudgment interest which they say was inappropriate as the claim was mot liquidated. As shown by the trial court’s findings, the 13.948 percent compounded computation was not an allowance of prejudgment interest on a damage award, but rather an element in computing the damage sustained. The trial court allowed it to make the injured party whole.
Next, the defendants complain that the trial court erred in refusing to give them credit for the $572,069 in gross oil and gas income produced by the Trust’s wells. The difficulty here is that this income did not go to the Trust; it was shown to have been utilized for expenses incurred in the oil and gas investments. In other words, the Trust was not enriched by such sum. It was reinvested by Arrowhead and/or eaten up in other expenses. This is reflected by an accountant’s report showing investments were less than the income tax deductions claimed each year. The gross profits figure remained in the Arrowhead pot.
Plaintiffs, on the other hand, argue the trial court erred in figuring damages based upon the after-tax amount available for investment (column 5 of appendix) as opposed to the amount of investment (column 2 thereof). We find no merit in this argument. The trial court was attempting to make the Trust whole. Had the Trust not been investing in oil and gas, the taxes shown in column four would have been paid and the Trust rendered poorer by such sums. To compute damages as suggested by the plaintiffs would result in a gigantic windfall to them. Their measure of damages is the diminution in value of the trust assets they received. The column four taxes did not diminish the Trust.
Plaintiffs further argue that the allowance for taxes on the recovery should have been figured on the basis of average tax rates for the years 1974 through 1987 (58.42 percent) rather than the 1987 tax rate (43.43 percent). We find this argument to be without merit. As stated, this allowance is for taxes on the recovery. What the tax rate might have been in prior years is of no consequence.
In assessing damages it is within the discretion of the trial court to apply equitable standards in order that the plaintiff may be made whole. Seaman U.S.D. No. 345 v. Casson Constr. Co., 3 Kan. App. 2d 289, Syl. ¶ 2, 594 P.2d 241 (1979). The trial court’s goal, appropriately, was to make the plaintiffs whole. State ex rel. Stephan v. Wolfenbarger & McCulley, P.A., 236 Kan. 183, 189, 690 P.2d 380 (1984). In this unusual and complex factual situation, the trial court fashioned a remedy to accomplish this goal. Our test on appellate review is not whether the remedy fashioned is the best remedy that could have been devised, but whether the remedy so fashioned is erroneous as a matter of law or constitutes a breach of trial court discretion. After careful consideration and review, we find no error or abuse of discretion in the computation of damages.
PUNITIVE DAMAGES
Defendants next contend that: (1) any award of punitive damages was unwarranted in this case; (2) the awards of punitive damages were excessive and contrary to the requirements of K.S.A. 1990 Supp. 60-3701.
The punitive damage awards were as follows:
For the period prior to July 1, 1987
Dorothea: $2,000,000
Seymour: $2,000,000
Seymour III: $ 25,000
For the period after July 1, 1987
Dorothea and Seymour,
jointly and severally: $ 89,250.
In Kansas, punitive damages are awarded to punish the wrongdoer for his malicious, vindictive, or willful and wanton invasion of another’s rights, with the ultimate purpose being to restrain and deter others from the commission of similar wrongs. Folks v. Kansas Power & Light Co., 243 Kan. 57, Syl. ¶ 6, 755 P.2d 1319 (1988).
At this point, we must examine the evidence and determine whether the evidence supports an award of punitive damages against the defendants. Such determination must be on an individual basis.
DOROTHEA
Dorothea was a co-trustee and a 49 percent owner of Arrowhead. The trial court found that Dorothea was knowledgeable on the stock market and that Gillespie conferred with her on Trust investments in the stock market. Gillespie had the final word on all investments. During the period of Dorothea’s co-trusteeship, the value of the stock portfolio rose significantly. No fault or blame is alleged against Dorothea relative to stock investments.
The trial court further found that Dorothea did not actively participate in Arrowhead and did not confer with Gillespie on the Trust’s investments in Arrowhead. Gillespie conferred with Seymour on oil and gas investments. Gillespie determined what block investments would be made with Arrowhead each year, had the checks made out, signed them, and sent same to Dorothea for her signature. Dorothea neither, saw nor signed the Trust’s income tax returns nor participated in their preparation until after the death of Gillespie (Dorothea signed the final Trust tax return). All trust records were kept by Gillespie. Dorothea’s mother and predecessor trustee, Dorothy Brown Wofford, deferred to Gillespie on all Trust decisions, including investments in Arrowhead. Dorothea continued that policy.
Arrowhead and Dorothea did profit from the finagling of trust interests orchestrated by Seymour. From this fact, the trial court concluded that Dorothea was a co-conspirator with Seymour and awarded punitive damages against het. We find the evidence insufficient to support the trial court’s finding that Dorothea was a co-conspirator and inconsistent with the trial court’s other findings that Dorothea’s role was purely passive relative to the oil and gas investments.
As a co-trustee, Dorothea had a duty to be informed on all Trust business and to act in the best interests of the Trust. She knew the Trust was investing in Arrowhead, a company in which she owned a substantial interest. She should have exercised heightened diligence in ascertaining whether such investments were in the Trust’s best interests. She failed to perform her duties as a co-trustee when she left the oil and gas investment matters to Gillespie. For this she has liability for compensatory damages. There was no evidence that Dorothea’s actions or inactions were malicious, vindictive, willful, or wanton. The awards of punitive damages against Dorothea are held to be improper and are reversed.
PAUL SEYMOUR, III
The evidence herein portrays Paul Seymour, III, as a young man who entered the oil and gas business through his parents’ interests therein. The father is clearly the dominant figure in the business. Seymour III followed his father’s directions without question as to the disproportionate billings and, obviously, accepted his father’s code of business ethics, which was shown by the evidence herein to be deficient in a number of significant respects. The trial court made no finding that Seymour Ill’s actions or inactions were malicious, vindictive, or a willful or wanton invasion of another’s rights. We find no evidentiary basis for an award of punitive damages against Seymour III, and the same must be reversed.
SEYMOUR
Seymour’s conduct relative to the Trust’s investments in Arrowhead has been discussed extensively elsewhere in this opinion and little would be gained by its repetition herein. It is sufficient to say that his egregious conduct as found by the trial court is legally adequate to support a punitive damage award.
This brings up to examination the amount of the punitive damage awards entered against Seymour.
K.S.A. 1990 Supp. 60-3701 provides, in pertinent part:
“(e) Except as provided by subsection (i), no award of exemplary or punitive damages pursuant to this section shall exceed the lesser of:
(1) The annual gross income earned by the defendant, as determined by the court based upon the defendant’s highest gross annual income earned for any one of the five years immediately before the act for which such damages are awarded; or
(2) $5 million.
“(f) In lieu of the limitation provided by subsection (e), if the court finds that the profitability of the defendant’s misconduct exceeds or is expected to exceed the limitation of subsection (e), the limitation on the amount of exemplary or punitive damages which the court may award shall be an amount equal to IV2 times the amount of profit which the defendant gained or is expected to gain as a result of the defendant’s misconduct.
“(g) The provisions of this section shall not apply to any action governed by another statute establishing or limiting the amount of exemplary or punitive damages, or prescribing procedures for the award of such damages, in such action.
“(h) As used in this section the terms defined in K.S.A. 60-3401 and amendments thereto shall have the meaning provided by that statute.
“(i) The provisions of this section shall apply only in an action based upon a cause of action accruing on or after July 1, 1987 and before July 1, 1988.”
The trial court found the plaintiffs’ cause of action herein accrued in August 1987. Without stating any legal basis therefor, the trial court circumvented the operation of the statute by entering two separate punitive damage awards based on the effective date of the statute (July 1, 1987). The award for punitive damages based on conduct occurring prior to July 1, 1987, was made without application of the statute, and the post-July 1 award was presumably in compliance with the statute, although we cannot see from the record the basis for the $89,250 calculation.
We hold that the determination of the punitive damage award against Seymour was erroneous. Only one award of punitive damages may be entered, and it must be made in accordance with the mandates of K.S.A. 1990 Supp. 60-3701. The awards of punitive damages entered against Seymour must be reversed and the case remanded for entry of a punitive damage award determined pursuant to K.S.A. 1990 Supp. 60-3701.
INDEMNIFICATION BY GILLESPIE ESTATE
Dorothea filed a third-party petition against the Estate of Pauline Brown Gillespie, seeking indemnification for any amount she might be found liable for herein. This was denied by the trial court, and Dorothea contends this was error. This was based on the trial court’s conclusion of law that “[s]ince both trustees were at fault, the court determines that Dorothea was more at fault, therefore, there is no recovery over against Gillespie’s estate. Restatement, Trusts paragraph 258.”
Dorothea contends that this determination is not only not supported by the evidence, but it is contrary to the trial court’s own findings of fact. We agree. The trial court found Dorothea’s role in the Trust’s investments in Arrowhead to be passive and that she did not participate in the actual running of Arrowhead. A central thread runs throughout the trial court’s findings of fact— namely that Gillespie was the dominant trustee and had the final say on all trust investments. Gillespie worked with the accountants; Gillespie had the records of the Trust; Gillespie signed the tax returns; Gillespie determined how much would be invested in Arrowhead each year; and Gillespie directed that plaintiffs not be informed of Trust business. It was Gillespie who conferred with Seymour, visited the Arrowhead offices, studied oil and gas development reports, and visited drilling sites. The trial court found Gillespie had no knowledge that Seymour was stacking the deck against the Trust in its block investments through his finagling, but also found Gillespie had done some finagling of her own. Namely, she caused valuable oil interests belonging to the Trust to be transferred to her own account in exchange for less valuable interests she owned individually. From the information she had available to her, Gillespie had to have been aware the Trust’s investments in Arrowhead were the equivalent of pouring money into a hole in the ground. She could have stopped investing in Arrowhead at any time, but continued to do so until the very end of her life. She commenced investing in Arrowhead to reduce tax liability. That it did accomplish.
The Restatement (Second) of Trusts § 258 (1957) provides:
Contribution or Indemnity from Co-trustee
“(1) • • • [W]here two trustees are liable to the beneficiary for a breach of trust, each of them is entitled to contribution from the other, except that
(a) if one of them is substantially more at fault than the other, he is not entitled to contribution from the other but the other is entitled to indemnity from him-.. ...”
Weighed against all of the trial court’s findings of Gillespie’s dominance in the Trust’s investments, we have the findings of Dorothea’s improperly passive role of deferment to Gillespie plus the fact the investments were being made in Dorothea’s company and the heightened diligence she should have exercised on such investments. After careful consideration, wé conclude that the co-trustees were equally at fault and Dorothea has no right to indemnification. However, she is entitled to contribution from the Gillespie estate of one-half of any portion of the judgment against her which she pays — the term judgment to include interest on the judgment and costs.
LETTER OF CREDIT
A final issue from the plaintiffs’ cross-appeal remains to be determined. After the trial court entered its award for compensatory damages herein, the defendants filed a notice of appeal therefrom. The trial court approved a letter of credit filed by defendants and stayed execution of the judgment. Shortly thereafter, the Court of Appeals dismissed the appeal as being interlocutory, the appeal having been taken prior to the hearing on and award of punitive damages. After the dismissal of the appeal, the trial court then released the letter of credit. Defendants then filed Chapter 11 bankruptcy pleadings and were granted a stay of execution from the bankruptcy court.
The plaintiffs have wholly changed their position on the premature appeal. Plaintiffs took the position before the Court of Appeals that the initial appeal was premature as no final judgment had been entered. The Court of Appeals dismissed the appeal on that grounds. Now, plaintiffs, in essence, seek to validate the earlier appeal in order to take advantage of the letter.of credit which was filed in connection with that appeal.
No error or abuse of discretion in the. trial court’s release of the letter of credit has been shown. We find the issue to be without merit.
The judgment is affirmed in part and reversed in part; and the case is remanded for further proceedings consistent'' with this opinion. ■' ' ‘ ' | [
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The opinion of the court was delivered by
Herd, J.:
This is an action for quiet title and declaratory judgment by Mark Twain Kansas City Bank (Mark Twain) against Kroh Brothers Development Company; the Kroh Foundation; the foundation’s Board of Control; Johnson County Bank, as trustee of the Kroh Foundation (Trustee); and others. All material parties moved for summary judgment. The district court granted Mark Twain’s motion and denied all others. The Trustee,. the Kroh Foundation, and the members of the Board of Control appealed.
The material facts in this case are not in dispute and were stipulated to in the district court. They are as follows:
John A. Kroh, Sr., was an original owner of Kroh Brothers Development Company, a Missouri corporation with offices in Kansas City, Missouri. His wife was Elizabeth Kroh. They had three children, George P. Kroh, John A. (Jack) Kroh, Jr., and Elinor Kroh Tourtellot. In 1957, John A. Kroh, Sr., established a trust entitled The Chatham Foundation. The Johnson County National Bank & Trust Company (now Johnson County Bank, N.A.) was the sole trustee.
The Chatham Foundation was established as a vehicle through which charitable donations could be made. The trust agreement provided Johnson County Bank, as trustee, would have no authority to determine and make charitable contributions except upon specific direction of the foundation’s Board of Control. The trust specifically provides: “The Board of Control piay . . . conduct, directly or indirectly through other organizations or groups, such activities as the Board of Control deems advisable . . . .” The original Board of Control was composed of John A. Kroh, Sr., Elizabeth Kroh, and attorney W. B. Cozad.
In 1970, John A. Kroh, Sr., and Elizabeth Kroh resigned as members of the Board of Control. Their sons, George and Jack, were appointed to fill their positions. Arch Wheeler, an officer and director of Kroh Brothers Development Company, became a member of ¡the Board of Control in 1971 or 1972. In 1974, the name of The Chatham Foundation was changed to the Kroh Foundation.
During the period from 1957 to 1970, the Board of Control determined the nature and extent of charitable donations and how assets of the Kroh Foundation were to be invested, managed, sold, and reinvested. During that period, the Trustee wrote checks and paid expenses as instructed by the Board of Control. Beginning in 1977, general administrative work for the Kroh Foundation was carried out by Jenna Garretson, Jack Kroh’s secretary and a Kroh Brothers Development Company employee. Garretson took over those duties from Wheeler who remained an inactive member of the Board of Control.
In September 1980, Freda Whitaker became an officer at Johnson County Bank and was primarily responsible for the Kroh Foundation account. At that time, its assets were a small bond, a small amount of cash, and some common funds. The Trustee exercised no independent discretion as to charitable contributions. Prior to 1987, the only investments the Trustee independently made on behalf of the Kroh Foundation was the investment of excess cash. Whitaker received and followed instructions from individual members of the Board of Control, as well as from Garretson. Whitaker considered Garretson’s instructions as coming from the Board of Control.
When Elizabeth Kroh died, she left $300,000 to the Kroh Foundation. Three $100,000 certificates of deposit were purchased with this money; however, they were not titled in the name of the Trustee but in the name of the Kroh Foundation. The Trustee received the interest from the CD’s. The Trustee was aware of how the CD’s were titled and wrote Garretson, stating, “[T]hese Certificates of Deposit should be held by our Bank since we are the trustee for the foundation and probably should be holding the assets of the foundation.” The Trustee finally obtained possession of the CD’s in 1987.
In 1983, a brochure was prepared for the Kroh Foundation. It listed John, Jack, George, and Elizabeth Kroh as directors and Garretson as assistant secretary. The brochure stated the Kroh Foundation was “incorporated under the laws of Kansas,” although the Kroh Foundation was never incorporated. Jack Kroh submitted invoices for the cost of designing and printing the brochure to Whitaker. The Trustee paid the invoices. The brochure was not widely distributed and Whitaker did not receive a copy.
In April 1981, John A. Kroh, Sr., and Elizabeth Kroh executed a deed conveying the real property at issue in this lawsuit to “the Kroh Foundation, a not-for-profit charitable organization.” The deed conveying the property on April 17, 1981, was delivered to the Trustee in August 1981. The deed was thereafter listed and carried as an asset of the Kroh Foundation on the Trustee’s books. This deed was recorded with the Register of Deeds on April 20, 1981.
It was the general practice of the Trustee to hold assets of a trust for which it was trustee in the bank’s name, as Trustee, or in the nominee’s name. Despite this policy, the property remained in the name of the Kroh Foundation. At the time it was transferred to the Kroh Foundation, the property was subject to a mortgage in favor of Farm & Home Savings.
Once the property was transferred to the Kroh Foundation, the Trustee paid the mortgage and taxes. The Trustee was not involved in collecting rent or managing the property, but left that function to Kroh Brothers Development Company. On an irregular basis the Trustee received payments that it was told were rents from the property.
In 1986, Mark Twain solicited loan business from Kroh Brothers Development Company. At this time Jack and George Kroh each owned 50% of Kroh Brothers Development Company. Jack Kroh wrote to Ed Enloe, president of Mark Twain, requesting a loan to “refinance” several properties, including the real property at issue in this case. On February 19, 1986, the Executive Loan Committee of Mark Twain approved credit of $4.4 million to Kroh Brothers Development Company “to purchase seven properties from Kroh Bros. Foundation.”
In March 1986, Garretson wrote a letter to Scott Spiker, a loan officer at Mark Twain, stating in part:
“In regard to the Kroh Foundation property, as I mentioned to you yesterday, we can either transfer the property into Kroh Brothers Development Company and realize considerable tax consequence or we can transfer the property into an entity of which Kroh Brothers has less than 30% interest. Rogér Phillips of the Jackson, Dillard firm tells me we can form a Kansas general partnership, which does not have to be filed with the Secretary of State as a limited partnership would, and transfer the building into that entity, transferring it at a later date into Kroh Brothers Development Company. This would involve another borrower where this loan is concerned. ”
Thereafter, Jack Kroh created 10770 El Monte Associates (general partnership). This partnership was made up of Kroh Brothers Development Company, as the managing partner holding a 30% interest, and Garretson and Jacob Mondschein, employees of Kroh Brothers Development Company, each with 35% partnership interests. Mondschein and Garretson characterized themselves in their depositions as “straw partners” to be “used sort of as placeholders until moneyed equity partners could be obtained.”
Prior to the transfer of the property from the Kroh Foundation to the general partnership, the Chatham Foundation trust agreement, together with all its amendments, was sent to Mark Twain. The individuals at Mark Twain indicated that they “thought” they had read it, and that they had “skimmed” it, yet no inquiry was made to the Trustee regarding the proposed transaction.
After reviewing the trust document, Spiker determined Mark Twain needed “a letter of opinion from the borrower as well as title coverage to show that that had been legally conveyed.” As a result, Mark Twain obtained an opinion letter from a Kroh Brothers Development Company attorney, a commitment for title insurance, minutes of a Kroh Brothers Development Company board meeting and a corporate resolution of Kroh Brothers Development Company authorizing the subject transaction. In addition, Mark Twain asked for a letter to be signed by the Board of Control. In response, a letter on Kroh Foundation letterhead stationery, signed by John, George, and Jack Kroh, as the Board of Control, was provided to Mark Twain. The letter states in part:
“Please let this letter serve as your confirmation that the Board of Control of Kroh Foundation is aware of and does approve the sale' of the property located at 10770-El Monte, Overland Park, Kansas, currently owned by the Foundation, to Kroh Brothers Development Company for a'purchase price of $750,000.
“The purpose of this transaction is to allow the Foundation to have liquid assets for its contributions rather than relying on the income from this property.
“If you have any questions regarding this transaction, please feel free to contact any of us.”
On March 31, 1986, a real estate contract was signed by Jack Kroh on behalf of the Kroh Foundation. This contract stated the property was being sold to the general partnership.
The closing took place on April 2, 1986. Though no such corporation existed, a corporation warranty deed for the property was used which states the real property was being conveyed from the Kroh Foundation, “a corporation, duly organized, incorporated and existing under and by virtue of the laws of the State of Kansas” to 10770 El Monte Associates. The deed was signed by Jack Kroh as “trustee.”
On April 2, 1986, the general partnership executed and delivered a promissory note in the original amount of $753,280. It also executed and delivered a mortgage on the property to Mark Twain. The mortgage was recorded with the Register of Deeds. Mark Twain advanced to the custodial account of Chicago Title Company in Kansas, by wire transfer, the sum of $753,280 together with other funds on other loans being made by Mark Twain to Kroh Brothers Development Company on the other properties. A portion of the general partnership’s loan proceeds was used by Chicago Title to pay off the existing mortgage on the property. Mark Twain instructed Chicago Title by letter that the remainder was “to be disbursed to the seller pursuant to their instructions.”
Garretson, on the request of Jack Kroh, asked Chicago Title Company to place the loan proceeds, including the proceeds from the sale of the Kroh Foundation property, into the Kroh Brothers Development Company account. Chicago Title Company complied with this request in spite of the letter from Mark Twain and the condition of the title. Neither Chicago Title nor anyone else involved made contact with or apprised the Trustee about this action.
The Trustee first became aware of the transaction on May 13, 1986, when an April 30, 1986, mortgage payment check to Farm & Home Savings was returned to the Trustee indicating the mortgage had been paid in full. Whitaker then called Garretson to find out what had happened. Garretson told her the loan had been paid and when asked by Whitaker to provide more infer mation, Garretson told Whitaker she would provide her with the documentation. Garretson provided Whitaker with no more information, and Whitaker contacted James Deberry, legal counsel for the Trustee.
Deberry made phone calls to attorneys for Kroh Brothers Development Company with no result. At the end of June 1986, the Trustee received a copy of the deed and contract for sale of the property from Roger Phillips, attorney for Kroh Brothers Development Company. During the next several months Deberry had numerous telephone conversations with attorneys for Kroh Brothers Development Company “attempting to get information on the status of the situation.” The Trustee, through attorney Deberry, made a number of attempts to find out “[w]hen [the Trustee was] going to get the money.” No one contacted the Board of Control or any of the Krohs personally to discuss the transaction after they became aware of the sale of the property. The Trustee did not know who the principals of the general partnership were or that a mortgage on the property had been executed in favor of Mark Twain until early 1987.
In July 1986, the general partnership assigned its interest in the real property to 10750 El Monte Associates (limited partnership), composed of Kroh Brothers Development Company as general partner and Garretson and Mondschein as limited partners.
In early November 1986, the public became aware of Kroh Brothers Development Company’s financial problems. On February 13, 1987, Kroh Brothers Development Company, Jack Kroh, George Kroh, and the limited partnership filed voluntary petitions for bankruptcy under Chapter 11 of the United States Bankruptcy Code. In October 1987, Deberry filed a proof of claim in the bankruptcy of the limited partnership on behalf of the Kroh Foundation “to quiet title of real property in creditor’s name or unliquidated money judgment believed to be about $753,280.00, less mortgage payments paid, plus reasonable rental payments on said property.”
On May 12, 1987, Wheeler, George Kroh, and Jack Kroh resigned from the Board of Control of the Kroh Foundation. At that time, a third amendment to the Kroh Foundation Trust was executed, and John A. Kroh, Sr., Elinor Kroh Tourtellot, and Michael K. Tourtellot were appointed to the Board of Control.
Prior to the transaction, the Trustee did not object to decisions the Board of Control made regarding the Kroh Foundation. After the sale of the property, members of the Board of Control continued to refer to themselves as “trustees,” to which the Trustee made no objection.
This case was initiated by Mark Twain’s petition to quiet title and for declaratory judgment filed June 27, 1988. In its petition, Mark Twain joined as parties defendant Kroh Brothers Development Company, Mondschein, Garretson, the Kroh Foundation, Johnson County Bank, N.A., Jack Kroh, George Kroh, Wheeler, John Kroh, Sr., Michael and Elinor Tourtellot, the limited partnership, and the general partnership. All defendants filed answers except Jack and George Kroh, who were found to be in default. In their answer, the Kroh Foundation and the Trustee sought to have the court quiet title to the property in the Trustee. Likewise, the El Monte general and limited partnerships filed a cross-claim seeking to quiet title to the property, as did Kroh Brothers Development Company.
In October 1989, the parties filed a Stipulation Agreement and Motion wherein they stipulated and agreed Mondschein, Garretson, and Wheeler claimed no interest in the subject property and, therefore, were to be dismissed from the action. This left Kroh Brothers Development Company; Johnson County Bank; the Kroh Foundation; and Michael and Elinor Tourtellot, and John A. Kroh, Sr., individually and collectively as the Board c>f Control of the Kroh Foundation, as defendants. The parties agreed the property should be sold for the sum of $950,000 and the net proceeds held by the District Court of Johnson County. The stipulation was approved by the court and the property was thereafter transferred to the new buyer. The proceeds of the sale were invested under the terms of the stipulation and are held by the court.
All remaining parties submitted motions for summary judgment by March 1990. At the request of the district court, the parties filed a stipulation of facts on September 6, 1990.
The district court found the Trustee ratified the sale to the general partnership and, thus, the subsequent mortgage of the real property to Mark Twain was valid. The district court granted Mark Twain’s motion for summary judgment and denied the Trustee’s motion for summary judgment. This appeal followed. We reverse.
First let us examine the scope of appellate review. Summary judgment is appropriate when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” K.S.A. 60-256(c). To defeat a properly supported motion for summary judgment, the nonmovant must come forward with “specific facts showing that there is a genuine issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). In this action the parties stipulated to the facts; thus, we review this case de novo because we have the same opportunity to weigh the evidence as did the district court. Stith v. Williams, 227 Kan. 32, 34, 605 P.2d 86 (1980).
The Board of Control argues the law of Missouri should be used to resolve this dispute, listing all the parties located in Missouri and all the activities that occurred in Missouri. It states Kansas follows the rules of lex loci contractus and lex loci delicti.
Since this issue was not raised in the district court, it is of questionable validity before us. See Enlow v. Sears, Roebuck & Co., 249 Kan. 732, 738, 822 P.2d 617 (1991). However, because we are reviewing this case de novo we will consider the issue. The cause of action is for quiet title to real estate in Kansas. The law of the situs of the real estate is applicable. Hanson v. Hoffman, 150 Kan. 121, 124, 91 P.2d 31 (1939).
The Trustee, the Kroh Foundation, and the Board of Control argue the district court erred in granting summary judgment to Mark Twain and instead should have granted their motions for summary judgment. In its memorandum decision, the district court stated in part:
“As grantor, Johnson County Bank ratified the deed which was signed by ‘John A. Kroh, Jr.’ as ‘Trustee’ and which transferred property from the Foundation to the general partnership. The acts of ratification were the Bank’s relative inaction over a period of-six months following notice of the transfer and its primary interest in receiving the proceeds from the sale of the property. This is evidence of an intent to ratify. It had possession of the deed and the contract for half a year. It knew what the deed looked like, it knew who signed the deed, and it had a contract of sale. The pertinent and material facts necessary to disaffirm the deed were before the trustee. Clearly, seeing the name of ‘John A. Kroh, Jr.’ as ‘Trustee’ on the deed was sufficient to signal the Bank that something was amiss. Nonetheless, Johnson County Bank did not disaffirm the deed.
“Ratification can also occur by the grantor’s acceptance of benefits flowing from the deed. 29 C.J. S., Deeds § 67. Johnson County Bank as Trustee of the Foundation received the benefit of having a mortgage on the property paid off. It attempted to obtain the additional benefits of the subsequent sale of the property to the general partnership. Johnson County Bank spent six months and fifteen phone calls trying to determine when it would receive the benefits of the sale of the property. Such activity constitutes ratification.”
The Trustee and the Kroh Foundation challenge the district court decision, contending the Trustee did not ratify the transaction because (1) the transfer is void under the Internal Revenue Code and at common law; (2) Jack Kroh did not purport to act as agent for the Trustee; (3) the Trustee did not have full knowledge of all pertinent and material facts; (4) the Trustee was not inactive and did not accept the benefits of the transaction; (5) there was no consideration for the ratification; (6) ratification requires the same formalities as the act being ratified; (7) Mark Twain knew or should have known of Jack Kroh’s lack of authority to sign as “Trustee;” and (8) the Trustee is not estopped to deny the validity of the transaction.
The Board of Control argues the Trustee’s power under the trust instrument was limited to following instructions of the Board of Control and, therefore, the Trustee had no authority to ratify the transaction. The Board of Control further contends only a party for whom an agent is purportedly acting may ratify the agent’s act and when Jack Kroh signed the deed he was not acting as the Kroh Foundation’s agent. Moreover, the Trustee did not have sufficient knowledge to ratify, and such ratification would leave the Kroh Foundation without the property and without the proceeds of the sale.
Let us now examine the powers and duties of a trustee conferred by statute and the trust agreement. The statutory duties of a trustee are set forth in K.S.A. 58-1203, which states in pertinent part:
“(a) From time of creation of the trust until final distribution of the assets of the trust, a trustee has the power to perform, without court authorization, every act which a prudent man would perform for the purposes of the trust including but not limited to the powers specified in subsection (c).
“(b) In the exercise of powers including the powers granted by this act, a trustee has a duty to act with due regard to the obligation as a fiduciary.”
A fundamental principle of trusts is that the trustee holds legal title to the trust property. “Every sale, conveyance or other act of a trustee in contravention of a trust shall be void.” K.S.A. 58-2405.
The trust agreement provides in part:
“[N]o part of the Trust Estate, either income or principal, shall revert or be distributed to or used for or inure to the benefit of (i) the Grantor, (ii) any other individual or corporate donor to the Trust Estate, (iii) any person who is a member of the family of Grantor or any such donor, as family is defined in Section 318(a)(1) of the Internal Revenue Code, (iv) any corporation controlled by the Grantor or by any such other donor, through the ownership, directly or indirectly of 50 per centum or more of the total combined voting power of all classes of stock entitled to vote or 50 per centum or more of the total value of shares of all classes of stock of such corporation ....
“FOURTH: In the administration of the Trust Estate, the Trustee, with the written approval or direction of the Board of Control, is hereby authorized and empowered ....
“(2) To sell, pledge, mortgage, transfer, exchange, convert or otherwise dispose of or grant options with respect to, any and all property at any time forming a part of the Trust Estate ....
“The written approval or direction hereinabove required need not necessarily be limited to a specific action or transaction.
, “The Trustee is hereby expressly authorized and given plenary power, in its sole and absolute discretion:
“(f) To execute and deliver any and all' instruments in writing which it may deem advisable to carry out any of the foregoing powers. No party to any such instrument in writing signed by the Trustee shall be obliged to inquire into its validity, or be bound to see to the application by the Trustee of any money or other property paid or delivered to it by such party pursuant to the terms of any such instrument.
“FIFTH: Anything contained in this Agreement to the contrary notwithstanding, no loan, investment or transaction shall be made by the Trustee or directed by the Board of Control which is defined as a ‘Prohibited Transaction’ by the Internal Revenue Code of the United States ... or which would deny to the Trust Estate exemption from taxation for income tax purposes ....
“NINTH: The Trustee shall make payments out of the Trust Estate for the purpose above set forth, to persons and in amounts designated in writing by a Board of Control to be composed of three members, none of whom shall be entitled to participate in any payments made by the Trustee' under this Agreement. . . . Said Board of Control in directing the Trustee to make payments for any of the purposes herein . . . shall have final and absolute discretion and authority.’’
Because this trust was a charitable trust, K.S.A. 79-4605 is also applicable. It provides in pertinent part:
“(1) In the administration of any trust which is a ‘private foundation,’ as defined in § 509 of the internal revenue code of 1954, a ‘charitable trust’ as defined in § 4947(a)(1) of the internal revenue code of 1954, . . . the following acts shall be prohibited:
“(a) Engaging in any act of ‘self-dealing’ (as defined in § 4941(d) of the internal revenue code of 1954), which would give rise to any liability for the tax imposed by § 4941(a) of the internal revenue code of 1954.”
The Internal Revenue Code provides the sale, exchange, or leasing, of property between a private foundation arid a disqualified person is an act of self-dealing. 26 U.S.C. § 4941(d)(1)(A) (1988). It further defines a disqualified person as:
“(A) a substantial contributor to the foundation,
“(B) a foundation manager . . . ,
“(C) an owner of more than 20 percent of—
(i) the total combined voting power of a corporation,
(ii) the profits interest of a partnership, or
(iii) the beneficial interest of a trust or unincorporated enterprise, which is a substantial contributor to the foundation,
“(D) a member of the family . . . ,
“(E) a corporation of which persons described in subparagraph (A), (B), (C), or (D) own more than 35 percent of the total combined voting power,
“(F) a partnership in which persons described in subparagraph (A), (B), (C), or (D) own more than 35 percent of the profits interest . . . .”26 U.S.C. § 4946(a)(1) (1988).
As previously stated, the district court determined the Trustee had ratified the transaction. The transaction, however, was in violation of the trust agreement’s provisions against self-dealing and actions in violation of the Internal Revenue Code. The transaction further violated K.S.A. 79-4605, which also prohibits self-dealing. A trustee acts as a fiduciary to the trust and may only exercise those powers as provided by the trust agreement. See In re Estate of Sutcliffe, 199 Kan. 686, 694, 433 P.2d 389 (1967); K.S.A. 58-1203(b). Any act by a trustee that violates the trust agreement is void. K.S.A. 58-2405.
A trustee cannot ratify an act that is in violation of the trust agreement because such an act is void. Thus, the Trustee did not ratify the acts of Jack Kroh. The district court’s ruling was in error.
The hardship for Mark Twain was brought on by its own actions. Numerous red flags of warning were raised. Mark Twain had a copy of the Trust Agreement which clearly prohibited self-dealing. It knew the trust was not a corporation, yet a corporation warranty deed was used. It knew Jack Kroh was not the trustee but accepted his signature on the deed and mortgage. It knew Johnson County Bank was trustee for the Kroh Foundation. Mark Twain ignored all signals of irregularity. Certain third persons enjoy protections under K.S.A. 58-1207 and K.S.A. 58-2402 when dealing with trustees. Mark Twain does not qualify for such protection. It is a sophisticated investor. It had been advised the general partnership was formed in order for Kroh Brothers Development Company to avoid “considerable tax consequence.” Mark Twain also had a copy of the agreement of the general partnership. Having received a letter from Garretson, Mark Twain should have been alerted to the fact that Garretson was an employee of Kroh Brothers Development Company and was acting as a straw partner in the general partnership.
We now determine where the title to the property is vested. Mark Twain argues the conveyance of real estate to the Kroh Foundation was void because unincorporated charitable organizations lack the capacity to take title, citing In re Estate of Loomis, 202 Kan. 668, 672, 451 P.2d 195 (1969). Loomis held a devise of property to an entity which is incapable of taking is void. Kansas Private Club Assn. v. Londerholm, 196 Kan. 1, 3, 408 P.2d 891 (1965), held individuals and corporations are the only legal entities recognized by Kansas, in the absence of qualifying statutes.
There is authority for courts to exercise their equitable powers to carry out a donor’s intentions. See Restatement (Second) of Trusts § 397 (1957), which provides in pertinent part: “(1) Except as stated in Subsection (2), a disposition for charitable purposes will not fail because of the failure of the trustee to act or for want of a trustee.” The Comment to § 397 states in pertinent part:
“(f) Direct gift to unincorporated charitable association. If the owner of property devises or bequeaths it to an unincorporated charitable association, a charitable trust may be created although the purposes of the trust are not mentioned in the will. If the association is incapable of taking title to the property and administering the trust, the court will appoint a trustee to take the title and administer the trust for the purpose of the association.”
We applied the principle stated in Restatement (Second) of Trusts § 397 in Barnhart v. Bowers, 143 Kan. 866, 57 P.2d 60 (1936). In In re Estate of Crawshaw, 15 Kan. App. 2d 273, Syl. ¶ 2, 806 P.2d 1014 (1991), the Court of appeals held: “[W]hen it is ascertained that the donor intended to create a public charity, the conveyance or bequest will not be allowed to fail because the trustee is incapable of taking.” See also Trustees of Endowment Fund of Hoffman Memorial Hosp. Ass'n v. Kring, 225 Kan. 499, 503-04, 592 P.2d 438 (1979), where the cy-pres doctrine was applied to carry out a grantor’s intent when a trust established by the grantor failed.
John and Elizabeth Kroh deeded the property to the Kroh Foundation. Neither John nor Elizabeth Kroh’s representatives claim any interest in the property. Although the deed was not in the name of the Trustee, the legal title vested in the Trustee, Johnson County Bank, and there it remains. We so hold, by authority of our equitable powers to liberally construe an instrument to carry out the intention of the donor. See In re Estate of Crawshaw, 15 Kan. App. 2d 273.
In light of our decision, we need not address the other issues raised.
We hold the district court erred in granting summary judgment to Mark Twain. It should have granted summary judgment to Johnson County Bank and the Board of Control. Title to the property is quieted in Johnson County Bank as Trustee of the Kroh Foundation, and, in accordance with the stipulation and agreement, the district court is ordered to pay the proceeds of the real estate sale to Johnson County Bank.
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The opinion of the court was delivered by
Lockett, J.:
Roger E. Slayden was a passenger in an automobile that was struck by a car driven by Jennifer S. Sixta. Slayden sued Sixta to recover damages for injuries he sustained in the accident. Slayden did not obtain service on Sixta until 97 days after the action had been filed. The trial court held Slayden’s action was barred by the two-year limitation of K.S.A. 1990 Supp. 60-513(a)(4) and dismissed his petition. The Court of Appeals affirmed, rejecting Slayden’s assertions that (1) the two-year limitation was tolled under K.S.A. 60-517 by the absence of Sixta from the state, and (2) the 90-day relation back period to obtain service under K.S.A. 1990 Supp. 60-203 was extended by the “unique circumstances” doctrine of Schroeder v. Urban, 242 Kan. 710, 750 P.2d 405 (1988). We granted Slayden’s petition for review.
On October 25, 1987, Roger Slayden was injured when the car in which he was a passenger was struck by a car driven by Jennifer Sixta. At that time, Sixta was a resident of Kansas and lived at 4907 West 71st Terrace in Prairie Village, Kansas. In April 1988, Sixta moved from Prairie Village to St. Charles, Missouri. Although Sixta’s insurance carrier knew she had moved, it did not inform Slayden’s counsel. Slayden’s attorney negotiated with Sixta’s insurance company, State Farm Insurance, for nearly two years. During that period, Slayden’s counsel had more than 12 contacts by phone and by letter with Sixta’s insurance carrier but never inquired of Sixta’s address.
Under the statute of limitations, K.S.A. 1990 Supp. 60-513, Slayden was required to file suit within two years from the date of the accident. On October 25, 1989, exactly two years after the accident, Slayden filed this action. The petition alleged that Sixta was a resident of Prairie Village, Kansas, and summons was issued for service at 4907 West 71st Terrace in Prairie Village, Kansas. On November 7, 1989, this summons was returned, unserved, with the notation that Sixta had “[m]oved; somewhere in St. Louis.” As noted, Sixta had moved in April 1988.
On the date the original summons was returned unserved, Slayden’s counsel ordered a “post office tracer” seeking the correct address. On November 13, 1989, the post office tracer was returned indicating Sixta’s correct address to be 2278 North Vil lage Drive, St. Charles, Missouri. On December 6, 1989, 23 days after obtaining Sixta’s correct address, plaintiff procured the issuance of an alias summons. The summons was issued by the district court clerk’s office with the incorrect address of “1178 North Village Drive.” Slayden’s attorney was not aware of the clerk’s mistake until January 16, 1990, when the summons was returned, unserved, indicating there was no such address on North Village Drive. On January 23, 1990, 90 days after the petition was filed, a new alias summons was issued bearing Sixta’s correct address. On January 30, 1990, 97 days after the petition had been filed, personal service was obtained.
Sixta filed a motion to dismiss the action on grounds the action was commenced beyond the two-year period of limitations. This motion was granted by the trial court. Slayden filed a motion for reconsideration. The trial court denied the motion, holding (1) the statute of limitations was not tolled by K.S.A. 60-517 because the plaintiff, in the exercise of due diligence, should have known of the defendant’s whereabouts; (2) the “unique circumstances doctrine of Schroeder v. Urban, 242 Kan. 710, applies only to enlargement of jurisdictional time limits to file an appeal and, further, Slayden had time before the expiration of the original 90-day period to obtain a 30-day extension under K.S.A. 1990 Supp. 60-203; and (3) Read v. Miller, 14 Kan. App. 2d 274, 788 P.2d 883, aff'd 247 Kan. 557, 802 P.2d 528 (1990), prevented a district court from granting an additional 30 days for service of process pursuant to K.S.A. 1990 Supp. 60-203 after the original 90-day period has expired. Slayden appealed.
When affirming the district court, the Court of Appeals noted a defendant is not “absent” from the state under K.S.A. 60-517 unless plaintiff does not know defendant’s whereabouts and plaintiff cannot with due diligence determine those whereabouts. At all times relevant, the Court of Appeals found, Sixta’s whereabouts were discoverable with the exercise of a minimum of effort. Thus, Sixta was not “absent” within the meaning of the statute and the statute of limitations was not tolled by K.S.A. 60-517. The court stated the “unique circumstances doctrine,” set out in Schroeder v. Urban, applies to appeals which are otherwise untimely, and requires reliance on “judicial action” rather than on a clerical mistake by a clerk of the district court. The Court of Appeals reasoned that because Slayden’s case is factually different the doctrine did not apply and the court declined to extend the doctrine. The Court of Appeals asserted the unique circumstances doctrine should be applied only where it is the sole remedy available to the party who has relied on a court’s action. Here, it found, Slayden could have and should have applied for a 30-day extension under K.S.A. 1990 Supp. 60-203 but failed to do so. Because this relief was available, the court held the circumstances were not unique and the doctrine did not apply.
K.S.A. 60-517 provides:
“If when a cause of action accrues against a person he or she be out of the state, or has absconded or concealed himself or herself, .the period limited for the commencement of the action shall not begin to run until such person comes into the state, or while he or she is so absconded or concealed, and if after the cause of action accrues he or she depart from the state, or abscond or conceal himself or herself, the time of the absence or concealment shall not be computed as any part of the ■ period within which the action must be brought. This section shall not apply to extend the period of limitation as to any defendant whose whereabouts are known and upon whom service of summons can be effected under the provisions of article 3 of this chapter.”
K.S.A. 1990 Supp. 60-203 states:
“(a) A civil action is commenced at the time of: (1) Filing a petition with the clerk of the court, if service of process is obtained . . . within 90 days after the petition is filed, except that the court may extend that time an additional 30 days upon a showing of good cause by the plaintiff; or (2) service of process ... if service of process ... is not made within the time specified by provision (1).”
The statute of limitations is an affirmative defense and the burden of pleading and proving its applicability rests on the defendant. However, the burden of proving facts sufficient to toll the statute of limitations is upon the plaintiff. A plaintiff does not sustain the burden of proving facts sufficient to toll the statute of limitations by demonstrating merely that a defendant was physically absent from the state. It must also be shown that defendant’s whereabouts while outside the state were unknown and that service of process could not have been effected under K.S.A- 60-301 et seq. during such absence. There is neither “absence” nor “concealment” as those terms are used in K.S.A. 60-517 if .the whereabouts of the defendant are known and service of summons can be perfected under K.S.A. 60-301 et seq. Gideon v. Gates, 5 Kan. App. 2d 23, 611 P.2d 166, rev. denied 228 Kan. 806 (1980).
Slayden filed suit on October 25, 1989, but Sixta was not served until January 30, 1990, some 97 days later. Thus, under K.S.A. 1990 Supp. 60-203, without an extension of time by the trial court, service was not obtained within 90 days of the filing of the petition — beyond the two-year limitation of K.S.A. 1990 Supp. 60-513. Unless the statute of limitations was tolled by 60-517 or there are circumstances which would override the effect of the running of the statute of limitations, Slayden s claim is time barred.
In Read v. Miller, 247 Kan. 557, 802 P.2d 528 (1990), a case relied on by the trial court in barring plaintiffs action here, plaintiff and defendant were involved in an automobile accident on September 20, 1986. Exactly two years later, on the day the statute of limitations expired (K.S.A. 1990 Supp. 60-513[a][4]), plaintiff filed her action in Wyandotte County. Summons listed defendant’s address as “Rural Route 2 Box 61 V, Bonner Springs, Kansas,” and was returned on September 21, 1988, marked “No Service” with a typed notation at the bottom, “need a street address for service in Wyandotte County.”
A second summons was issued September 29, 1988, with added address instructions: “West on 32 Highway from Bonner Springs Stop Light approximately 5 miles to gravel road. Go south approximately IV2 miles, House on left side of road, name on mailbox.” The second summons was returned on October 3, 1988, marked “No Service” with a typed notation: “unable to serve at above address, per Bonner Spring Fire Dept it is located in Tanglewood, which is in LEAVENWORTH COUNTY, KANSAS.”
On January 13, 1989, 115 days after filing her action, plaintiff obtained a third summons which was successfully served by the sheriff of Leavenworth County on January 17, 1989. The next day, plaintiff filed a motion for enlargement of time to serve defendant, which was granted by the trial judge. The trial court found the extension Could be granted independent of K.S.A. 1990 Supp. 60-203(a) under the provisions of K.S.A. 1990 Supp. 60-206(b)(2), which states:
“When by this chapter or by a notice given thereunder or by order of court an act is required or allowed to be done at or within a specified time, the judge for cause shown may at any time in the judge’s discretion ... (2) upon motion made after the expiration of the specified period permit the act to be done where the failure to act was the result of excusable neglect.”
A majority of this court disagreed with the trial court holding that K.S.A. 1990 Supp. 60-203(a) contains specific provisions for an extension of time for service of process which control general provisions for enlargement of time found in K.S.A. 1990 Supp. 60-206(b). Citing the clear and settled meaning of the language used in 60-203(a), the lack of legislative history to the contrary, and existing case law rules, the court held that an extension of time for the period in which service of process will relate back to the date an action is filed must be sought and granted prior to the expiration of the original 90-day period provided by 60-203(a).
The dissent in Read observed that 60-206(b) expressly provided that the court, in its discretion, may order an extension even after the expiration of a specified time period, but only for “cause shown” and if the failure to act in a timely fashion was the result of excusable neglect. Excusable neglect requires a demonstration of good faith on the part of the parties seeking an enlargement and some reasonable basis for noncompliance within the time specified in the statute. The dissent noted there are specific statutory prohibitions against the granting of an enlargement of time contained in 60-206(b) and that an extension under 60-203 was not one of the specific prohibitions. Although this writer wrote the dissent in Read, it is recognized the majority’s holding that an extension of time for service of process must be sought and granted prior to the expiration of the original 90-day period provided by K.S.A. 1990 Supp. 60-203 controls.
As to whether the unique circumstances of a clerk’s error in addressing the summons should extend the 30-day limitation of K.S.A. 1990 Supp. 60-203, the Court of Appeals in this case held that Schroeder v. Urban, 242 Kan. 710, which adopted the “unique circumstances doctrine,” was factually different from this case. The court stated the doctrine itself applies to appeals which are otherwise untimely, and requires reliance on “judicial action” taken prior to the expiration of the time to appeal. Because this was not the situation, the court held the doctrine did not apply and declined to extend the doctrine to the facts of this case. The Court of Appeals further stated the unique circumstances doctrine should be applied only where it is the sole remedy available to the party who has relied on a judge’s action. It asserted Slayden could have and should have applied for a 30-day extension but failed to do so. Because relief had been available, the Court of Appeals held the circumstances were not unique and the doctrine does not apply.
In Schroeder v. Urban, the district court entered judgment against the Urbans. The attorney who represented the Urbans at trial notified them of the judgment and also declined to represent them on any appeal. On March 23, 1987, 28 days after the entry of judgment, the trial judge granted the defendants an additional 30 days to take their appeal. The ruling was made during a conference call between the judge and counsel for both plaintiffs and defendants and was journalized on the same day. Within the 30-day extension, the Urbans secured new counsel and on April 22, 1987, filed their notice of appeal. On July 16, 1987, the Court of Appeals dismissed the appeal for lack of jurisdiction.
In reviewing the dismissal by the Court of Appeals, the majority noted at the time the United States Supreme Court decided the case of Harris Truck Lines, Inc. v. Cherry Meat Packers, Inc., 371 U.S. 215, 217, 9 L. Ed. 2d 261, 83 S. Ct. 283 (1962), Fed R. Civ. Proc. 73(a) was in effect. That rule permitted an extension of time for taking an appeal only “upon a showing of excusable neglect based on a failure of a party to learn of the entry of the judgment” — language identical to that of K.S.A. 1990 Supp. 60-2103(a). The facts in Harris were that, within the 30-day time period for taking an appeal, counsel moved for an additional 14 days, the extension was granted by the trial court, and the notice of appeal was filed on the 14th day but after the expiration of the 30-day statutory period. The Court of Appeals for the 7th Circuit dismissed the appeal. The United States Supreme Court reversed, stating:
“In view of the obvious great hardship to a party who relies upon the trial judge’s finding of ‘excusable neglect’ prior to the expiration of the 30-day period and then suffers reversal of the finding, it should be given great deference by the reviewing court. Whatever the proper result as an initial matter on the facts here, the record contains a showing of unique circum stances sufficient that the Court of Appeals ought not to have disturbed the motion judge’s ruling.” 371 U.S. at 217.
The majority in Schroeder v. Urban held that, in the interest of justice, an appeal which is otherwise untimely may be maintained in unique circumstances if (1) the appellant reasonably and in good faith relies upon judicial action seemingly extending the appeal period; (2) the court order purporting to extend the appeal time was for no more than 30 days and was made and entered prior to the expiration of the official appeal period; and (3) the appellant files a notice of appeal within the period apparently judicially extended.
In this case, we note that 40 of the 97 days which passed between the filing of Slayden’s petition and service upon Sixta are due directly to the error of the clerk of the district court in issuing the first alias summons with the wrong address.
In the federal courts, “unique circumstances,” although limited to appeals, has proven to be an elastic concept. The doctrine seems to require a demonstration of good faith on the part of the party seeking an enlargement of time to appeal and a reasonable basis for noncompliance within the time specified by the rules. The same concept should guide this court when applying the doctrine.
In determining whether to expand the unique circumstances doctrine further, we are forced to balance the K.S.A. 1990 Supp. 60-513 limitation for filing the action, the requirement of K.S.A. 1990 Supp. 60-203(a) that service of process be obtained within 90 days after a petition is filed, and the policy to provide litigants their day in court. A timely filing, service of process, and a just adjudication on the merits of the action is what our legislature intended by adopting the Code of Civil Procedure. If we determine that a clerk of the district court who addresses the summons is acting on behalf of the litigant, Slayden’s service was not timely and he has forfeited his right to litigate. If the clerk is acting on behalf of the court, Slayden should not be charged with the delay caused by the clerk’s error in addressing the summons.
Our legislature did not intend that an error by a clerk of the district court when addressing a summons should deprive a litigant of the right to an adjudication of the issues on the merits. We find under the unique circumstances of this case that the 40- day delay in serving the summons caused by the clerk of the district court should not be charged to the plaintiff. Service of summons on the defendant was within the 90-day limit of K.S.A. 1990 Supp. 60-203.
The decisions of the district court and the Court of Appeals are reversed and the matter is remanded to the district court for further action.
Abbott, J., not participating.
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The opinion of the court was delivered by
Herd, J.:
The law firm of Wallace, Saunders, Austin, Rrown (Wallace-Saunders) failed to comply with the district court’s order to compel the production of documents. The district court, therefore, struck Wallace-Saunders’ pleadings and held Wallace-Saunders’ judgment lien for attorney fees shall not constitute a prior lien to any other judgment lien against Louisburg Grain Company, Inc. (Louisburg). The Court of Appeals affirmed district court on August 2, 1991. Wallace, Saunders, Austin, Brown & Enochs, Chtd. v. Louisburg Grain Co., 16 Kan. App. 30, 818 P.2d 805 (1991) (hereinafter cited as Wallace-Saunders). We granted review.
This suit arises out of disputes wife E. Sylvia Anderson, and the City of Arkansas City (Arkansas City), the City of Hesston (Hesston), and the Southwest National Bank of Wichita (the Bank). Prior to 1980, Arkansas City and Hesston issued industrial revenue bonds to finance the purchase of real estate and the construction of motels. The Bank acted as fiscal agent for both cities. The Andersons and a business associate personally guaranteed the industrial revenue bonds. In 1982, the corporations responsible for lease payments defaulted on the bonds, prompting the Cities and the Bank to bring suit against the Andersons. City of Arkansas City v. Anderson, 243 Kan. 627, 628, 762 P.2d 183 (1988), cert. denied 490 U.S. 1098 (1989).
In July 1984, judgment in Cowley County for $2,604,029.49 plus interest against the Andersons. In October 1984, the Harvey County District Court entered a judgment in favor of Hesston and the Bank, and against the Andersons, for $585,000 plus interest. City of Arkansas City, 243 Kan. at 630. The Cities and the Bank have filed numerous suits in at least four counties in an effort to collect their judgments. This is at least the seventh case involving Louis-burg, K-M Land Company, Inc. (K-M Land), A. Scott Anderson, and E. Sylvia Anderson to reach the appellate courts of Kansas and Missouri. Wallace-Saunders, 16 Kan. App. 2d at 31.
Wallace-Saunders a petition a $34,426.32 for unpaid legal fees against Louisburg and K-M Land on December 21, 1988. Louisburg is. owned in its entirety by KM Land, which is owned in its entirety by A. Scott Anderson and his family members. Wallace-Saunders, 16 Kan. App. 2d at 33. Louisburg and K-M Land, appearing pro se, filed an answer stating in toto: “Defendant admits .that the monies are due as claimed by the Plaintiffs, but the Defendant has no cash to pay.” On January 4, 1989, judgment was entered in favor of Wallace-Saunders.
In October 1989, Wallace-Saunders filed a request for a writ of special execution. On December 27, 1989, Wallace-Saunders filed a motion for order of sale and sent notice of sale to interested parties. On January 12, 1990, the Bank, acting as trustee for Arkansas City and Hesston, filed a motion to set aside the writ of special execution and to deny an order of sale.
The Cities and the Bank had registered their Harvey County judgment against A. Scott Anderson in Miami County in 1985. In 1986, they registered their Cowley County judgment against the Andersons in Miami County. In April 1989, the Cities and the Bank obtained a judgment in Harvey County against Louis-burg and K-M Land in the amount of $116,119. This judgment was registered in Miami County on May 15, 1989. The Bank concedes Wallace-Saunders’ judgment lien, if valid, is prior in time and, therefore, superior to the Cities’ and the Bank’s second judgment lien obtained in Harvey County.
The Bank’s motion to set aside the writ of execution alleged, among other things, Wallace-Saunders had represented Louis-burg, K-M Land, and the Andersons in prior actions brought by the Cities and the Bank and continued to represent them. The Bank further alleged Wallace-Saunders’ action against Louisburg and K-M Land “constituted a collusive and improper attempt to defraud creditors” of Louisburg, K-M Land, and the Andersons and, thus, the action should be set aside. Finally, the Bank claimed:
“13. In addition, if plaintiff is not now and was never acting as defendant’s attorney with regard to this matter, then communications between plaintiff defendant relevant to the bona fides of this lawsuit are not privileged are discoverable.”
The district court agreed there was an appearance of fraud and set aside the writ of special execution. On May 22, 1990, the district court ordered the matter set for trial following a discovery conference.
1990, filed a motion to compel the production of documents. The Bank had requested documents that Wallace-Saunders refused to produce, claiming the documents were protected by the attorney-client privilege. The Bank argued Wallace- Saunders could not claim privilege on any communications between itself and Louisburg or K-M Land relating to Wallace-Saunders’ cause of action for attorney fees because Wallace-Saunwas not acting as Louisburg and K-M Land’s attorney. Rather, any such communications constituted communications between a creditor and its debtor.
On August 9, 1990, the district court produce all correspondence to or from “A. Scott Anderson, E. Sylvia Anderson, K-M Land Company and Louisburg Grain Com-from January 1, 1987 through the current date. ” The district also ordered Wallace-Saunders to produce all time records “all written communications and notes relating to the employment agreement and contract” for the same time period. Wallace-Saunders requested that the district court view these documents in camera before releasing them to the Bank. This request was denied.
a utory appeal from the denial of its motion for in camera inspection. The Bank responded to Wallace-Saunders’ motion and in addition filed a motion to strike Wallace-Saunders’ motion for order of sale on the grounds Wallace-Saunders refused to comply with the district court’s discovery order. After hearing oral arguments, the district court denied Wallace-Saunders’ motion to file an interlocutory appeal. The district court granted the Bank’s motion to strike and held Wallace-Saunders’ judgment against Louisburg “shall not constitute a prior lien against real estate in Miami County.” Wallace-Saunders appeals this final order.
First, we will address Bank’s challenge to Wallace-Saunders’ judgment lien was untimely. Wallace-Saunders claims the Bank’s motion to set aside the writ of special execution was out of time under K.S.A. 60-260(b) because it was filed more than a year after the district court entered judgment in favor of Wallace-Saunders on January 4, 1989. K.S.A. 60-260(b) states in part:
upon party or said party’s legal representative from a final judgment, order, or proceeding for the following reasons: . . (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or. other misconduct of an adverse party .... The motion shall be made within a reasonable time, and for reasons (1), (2) and (3) not more than one year after the judgment, order, or proceeding was entered or taken. . . . This section does not limit the power of the court to . . . set aside a judgment for fraud upon the court.” (Emphasis added.)
The Bank argued that the judgment in favor of Wallace-Saunders should be treated as a conveyance governed by K.S.A. 33-102. K.S.A. 33-102 provides in pertinent part:
“Every gift, grant or conveyance of lands, tenements, hereditaments, rents, goods or chattels, and every bond, judgment or execution, made or obtained with intent to hinder, delay or defraud creditors of their just and lawful debts or damages, or to defraud or to deceive the person or persons who shall purchase such lands, tenements, hereditaments, rents, goods or chattels, shall be deemed utterly void and of no effect.” (Emphasis added.)
The Court of Appeals held the Bank’s motion was timely because it sought to set aside Wallace-Saunders’ writ of execution-. The writ was granted October 5, 1989, and the Bank filed its motion January 12, 1990, well within the one-year limit of K.S.A. 60-260(b). The Court of Appeals acknowledged K.S.A. 60-260(b) may not apply to this case because the statute “provides relief for parties but does not mention non-parties.” Furthermore, the Court of Appeals found the Bank’s action permissible and timely under K.S.A. 33-102. Wallace-Saunders, 16 Kan. App. 2d at 40-41.
We agree; the Bank filed its motion within the time allowed by K.S.A. 33-102. We, however, find K.S.A. 60-260(b) is inapplicable due to the fact the Bank was not a party to the order of execution it is attempting to set aside.
II
Next, we address the question of whether the trial court abused its discretion in ordering Wallace-Saunders to produce all written communications between Wallace-Saunders and the Andersons, K-M Land, and Louisburg.
Any evidence is discoverable if it is relevant to the subject matter of the cause of action as long as the evidence is not privileged. K.S.A. 1990 Supp. 60-226(b)(l). If justice requires, the district court may issue a protective order limiting the scope of discovery.' K.S.A. 1990 Supp. 60-226(c).
Wallace Saunders argues the documents requested by the Bank fall within the attorney-client privilege. K.S.A. 60-426 defines the attorney-client privilege, stating in part:
“(a) General rule. Subject to K.S.A. 60-437, and except as otherwise provided by subsection (b) of this section communications found by the judge to have been between [a] lawyer and his or her client in the course of that relationship and in professional confidence are privileged, and a client has a privilege ... (2) to prevent his or her lawyer from disclosing it ... . The privilege may be claimed by the client in person or by his or her lawyer ....
“(b) Exceptions. if the judge finds that sufficient evidence, aside from the communication, has been introduced to warrant a finding that the legal service was sought or obtained in order to enable or aid the commission or planning of a crime or a tort . . . .”
As explained by the Court of Appeals, “[t]he attorney-client privilege applies only to communications made to an attorney in his capacity as a legal advisor.” Wallace-Saunders, 16 Kan. App. 2d at 36 (citing State v. Maxwell, 10 Kan. App. 2d 62, 63, 691 P.2d 1316 [1984], rev. denied 236 Kan. 876 [1985]).
The Bank client privilege on behalf of its clients — the Andersons and the companies — because the suit for attorney fees is fraudulent. See In re A.H. Robins Co., Inc., 107 F.R.D. 2, 9 (D. Kan. 1985). This court has stated:
“[T]he- badges or indicia of fraud [in a fraudulent conveyance] are: (1) a relationship between the grantor and grantee; (2) the grantee’s knowledge of litigation against the grantor; (3) insolvency of the grantor; (4) a belief on the grantee’s part that the asset transferred by the grantor was the grantor’s last asset subject to a Kansas execution; (5) inadequacy of consideration; and (6) consummation of the transaction contrary to normal business procedures.” City of Arkansas City, 243 Kan. 627, Syl. ¶ 2.
The Bank claims it has made out a prima facie case of fraud, thereby invoking the privilege exception found in K.S.A. 60-426(b)(1).
The Court of Appeals stated:
“The United States District Court of Kansas has considered what degree of proof is required to invoke the ‘crime or fraud’ exception of K.S.A. 60-426(b)(1). See In re A.H. Robins Co., Inc., 107 F.R.D. 2 (D. Kan. 1985). In Robins, the court concluded that a prima facie showing of fraud was required to invoke the exception. 107 F.H.D. at 8.” Wallace-Saunders, 16 Kan. App. 2d at 37.
Other courts have come to the same conclusion as the Robins court. For example, Justice Cardozo wrote for the United States Supreme Court:
“We turn to the precedents in the search for an analogy, and the search is not in vain. There is a privilege protecting communications between attorney and client. ... A client who consults an attorney for advice that will serve him in the commission of a fraud will have no help from the law. He must let the truth be told. There are early cases apparently to the effect that a mere charge of illegality, not supported by any evidence, will set the confidences free. [Citations omitted.] But this conception of the privilege is without support in later rulings. ‘It is obvious that it would be absurd to say that the privilege could be got rid of merely by making a charge of fraud.’ [Citation omitted.] To drive the privilege away, there must be ‘something to give colour to the charge;’ there must be ‘prima facie evidence that it has some foundation in fact.’ [Citation omitted.] When that evidence is supplied, the seal of secrecy is broken.” Clark v. United States, 289 U.S. 1, 15, 77 L. Ed. 993, 53 S. Ct. 465 (1933).
K.S.A. 60-426(b)(l) requires a finding of sufficient evidence of fraud to create any exception to the attorney-client privilege. We hold sufficient evidence is that which constitutes a prima facie case.
We have stated:
“Prima facie evidence denotes evidence which, if left unexplained or uncontradicted, would be sufficient to carry the case to the jury and sustain a verdict in favor of the plaintiff on the issue it supports.” Baker v. City of Garden City, 240 Kan. 554, Syl. ¶ 3, 731 P.2d 278 (1987).
The district court and the Court of Appeals found that the Rank “made a showing that five of the six badges of fraud could probably be established.” Wallace-Saunders, 16 Kan. App. 2d at 37. The missing badge is inadequacy of consideration, a significant omission. Therefore, the Bank seeks to discover evidence related to inadequacy of consideration. However, since lack of consideration is so significant to this case, the Bank’s claim of fraud to justify discovery has failed. It did not present a prima facie case; thus, it cannot invoke the exception to the attorney-client privilege. All documents falling within the attorney-client privilege are protected from discovery, and the. trial court’s and Court of Appeals’ rulings to the contrary are reversed.
The Bank next argues the attorney-client privilege is inapplicable to communications between Wallace-Saunders and the Andersons or their companies because such communications were not made in the law firm’s capacity as a legal advisor. Wallace-Saunders admits it has represented the Andersons and the companies and continues to represent them on other matters, and claims their communications are privileged. The Court of Appeals, however, concluded Wallace-Saunders “was not acting, nor could it act, as attorney for Louisburg and K-M when it sued them to collect fees and obtained a judgment.” Wallace-Saunders, 16 Kan. App. 2d at 38.
We agree. According to MRPC 243) concerning conflicts of interest:
A lawyer shall not represent a client if the representation of that client be materially limited by the lawyer’s responsibilities to another client to a third person, or by the lawyers own interests, unless:
(1) the lawyer reasonably believes the representation affected; and
(2) the client consents after consultation. ...”
We, however, disagree with the broad statement of the Court of Appeals that “all communications are discoverable as ordered by the court”. Wallace-Saunders, 16 Kan. App. 2d at 38. The district court ordered the production of all communications between Wallace-Saunders and the Andersons and the companies from January 1, 1987, to the present date. This order is not limited to the cause of action currently under consideration, but includes all communications dealing with disputes between the Andersons and Arkansas City, Hesston, and the Bank. It could encompass communications involving the Andersons and entities not a party to this action. Considering the Andersons’, Louis-burg’s, and K-M Land’s history of litigation with the Cities and the Bank, the district court’s order could greatly prejudice the Andersons.
Our finding that the communications between the law firm and the Andersons or the companies are discoverable is limited to communications pertaining to matters in the case at bar, and no other, from January 1, 1987, to the present time. This case should be remanded to the district court, where an in camera inspection should be conducted by the court to determine relevancy of documents in this case. Wallace-Saunders should produce all such documents for the court and should sort them, showing what is conceded to be discoverable and what it claims is privileged. The court then should make an order compelling production of all relevant documents exempt from the attorney-client privilege.
We feel impelled to emphasize that the attorney-client privilege is important to the administration of justice. For example, “[t]he observance of the ethical obligation of a lawyer to hold inviolate confidential information of the client not only facilitates the full development of facts essential to proper representation of the client but also encourages people to seek early legal assistance.” MRPC 1.6 (1991 Kan. Ct. R. Annot. 239) (Kansas Comment). The privilege should not be set aside lightly. Any language in the Court of Appeals’ decision inconsistent with this opinion is overruled.
Ill
Finally, we must determine whether the district court abused its discretion in striking Wallace-Saunders’ pleadings as a result of the law firm’s failure to comply with the court’s order to compel production of documents.
Sanctions for failing to obey a court order are governed by K.S.A. 60-237(b)(2), which provides in part:
“If a party . . . fails to obey an order to provide or permit discovery, . . . the judge before whom the action is pending may make such orders in regard to the failure as are just, and among others the following:
(C) An order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party.”
We have stated: “Most of the cases in which a dismissal or a default judgment have been held proper sanctions involve parties who refuse or fail to follow a discovery order.” Burkhart v. Philsco Products Co., 241 Kan. 562, 578, 738 P.2d 433 (1987). Wallace-Saunders withheld documents against the district court’s order. The Court of Appeals held the district court’s decision to strike was not an abuse of discretion. Wallace-Saunders, 16 Kan. App. 2d at 39.
This presents a difficult question. Wallace-Saunders disobeyed the court’s order, which should automatically require sanctions. However, because the order to produce was overbroad, Wallace-Saunders was placed in a most difficult situation after it was denied the right to perfect an interlocutory appeal. If it produced the privileged documents, the genie was out of the bottle incapable of being returned. Its client had no remedy. In light of this, we hold the order was an abuse of discretion and is reversed, reinstating plaintiffs pleadings.
The district court are part and reversed in part, and the case is remanded to the district court for further proceedings consistent with this opinion.
Abbott, J., not participating.
Terry L. Bullock, District Judge, assigned.
McFarland, J., concurs in the result. | [
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The opinion of the court was delivered by
Herd, J.:
This is a workers compensation case. The children and widow of Delbert Wayne Angleton filed workers compensation claims against his employer, Starkan, Inc. (Starkan) following Angleton’s death. The district court held Angleton’s three minor children were entitled to compensation, but his wife’s claim was barred by the statute of limitations. Starkan appeals from the district court decision, and Angleton’s widow cross-appeals.
The facts from which this controversy arose follow: Delbert Wayne Angleton was employed as a truck driver by Starkan on February 4, 1984. On that date, Angleton was hauling a load of cattle from South Coffeyville, Oklahoma, and Cedar Vale, Kansas, to a feedlot in Leoti, Kansas. Angleton never arrived at the feedlot in Leoti. Instead, Angleton was murdered by Gary Lee Hall and his wife, Roberta.
Gary and Roberta Hall were ranchers and truckers from Oregon. On or about January 26, 1984, the Halls transported a load of apples from Oregon to Houston, Texas. The load of apples was unloaded on or about January 29, 1984. The Halls then headed back to Oregon, going through western Kansas along the way, hoping to find a load for the return trip. Their intended method of obtaining the return load was a bit unusual. They intended to hijack a truck with a load. The Halls spent some time in the Dodge City and Oakley areas, where they followed several trucks for the purpose of carrying out their hijacking scheme, but for various reasons the loads they saw did not meet their criteria.
Things changed on the morning of February 5, 1984. The hijackers spotted Angleton with his load of cattle in the Garden City area. They followed him in their truck as he drove north toward Scott City. The Halls had found the truck and load they wanted for their return trip. While Roberta drove, she struck up a conversation with Angleton on the citizens’ band radio. Roberta later testified she asked Angleton to pull over to smoke marijuana with her. Angleton then followed the Halls’ truck as Roberta pulled off the highway into a deserted service station in front of an abandoned refinery. Roberta testified Angleton got into the Halls’ truck and, while smoking a marijuana cigarette, was shot in the back of the head by Gary, who feigned to be sleeping in the sleeper cab.
According to Roberta, the shots killed Angleton instantly. The Halls covered his body with a sleeping bag, and they then took both trucks. In Wyoming, the Halls switched truck loads and hauled the cattle to Oregon, where they were unloaded at the Halls’ ranch. Several of the cattle had died due to lack of food and water. They were buried in a pit, along with Angleton’s body, on the Halls’ ranch. The remaining cattle were subsequently branded with the Halls’ brand and sold. Angleton’s truck was found in Wyoming a couple of weeks after his disappearance.
Following Angleton’s disappearance, his wife Bobbie Angleton attempted to locate him. She contacted the Highway Patrol in Wichita, the Kansas Bureau of Investigation, and other truck drivers who knew Angleton. The K.B.I. believed Angleton had stolen the truck and cattle and, therefore, issued a warrant for his arrest.
In early March 1987, Roberta, who was divorced from Gary in 1985, told authorities of Angleton’s death and the circumstances surrounding it. This led to the discovery of Angleton’s body on March 8, 1987. Roberta was granted immunity by the authorities for her testimony against Gary, who was charged with and convicted of first-degree murder in Scott City, Kansas. The facts of the murder case are summarized in State v. Hall, 246 Kan. 728, 731-38, 793 P.2d 737 (1990).
Angleton’s widow and his three minor children filed a claim for workers compensation on August 14, 1987. Following a hearing on October 18, 1988, before a Workers Compensation Administrative Law Judge, a decision was issued on February 7, 1990. The Administrative Law Judge made the following findings:
“At the time that the deceased employee accepted the invitation of Roberta Hall to ‘smoke a joint’, the deceased employee deviated from his employment with the respondent, and at that time was on a ‘frolic of his own’.
“2. The claimants have not proved by a preponderance of credible evidence that the death of Delbert Wayne Angleton arose out of and in the course of his-employment with the respondent. . . .
“3. . . . [I]mmediately after the body was found on March 8, 1987, Mrs. Angleton was notified as was the employer. Notice is found to have been promptly given following discovery of the body, and no prejudice has been found to have resulted to the respondent as a result of that delayed notice.
“4. . . . Based upon the record made in this matter as well as the circumstances, it is found that the claimants’ claim or claims for compensation were timely made and served upon the respondent.”
Based upon these findings and others, the Administrative Law Judge denied all claimants’ requests for compensation.
Bobbie Angleton and the children as well as Starkan and its insurance carrier applied for' a director’s review of the award entered by the Administrative Law Judge. Assistant Director William F. Morrissey entered his order on June 7, 1990. The order states in part:
“The employer and the claimants learned of the circumstances of Mr. Angleton’s death at approximately the same time. Respondent [Starkan] suffered no lack of notice from claimant and therefore no prejudice.
“The fact that the deceased was smoking a marijuana cigarette seems to be the only factor which lays a basis for determining that the decedent had left the course of his employment. Had the deceased been invited to pull off the road by another male driver at a truck stop for the purpose of having a cup of coffee and been killed in the process, this claim would have, no doubt, been recognized as compensable.
“. . . The deceased’s departure from his course of travel was so de minimus that it cannot constitute a deviation from his employment.
“Clearly, the motivation for the attack upon the decedent arose out of the course of his employment. The evidence is clear that the attackers did not know the deceased. Their sole purpose in their attack upon him was to steal his load of cattle. [Citation omitted.]
“Based upon the above, it is found that the fatal injury of the deceased, Delbert Wayne Angleton, was caused by personal injury by accident which arose out of and in the course of his employment with respondent [Starkan] on February 5, 1984.”
Ultimately, the Assistant Director held that because Bobbie Angleton did not give Starkan a “written claim for compensation within one year of the date of the accident or death and did not file application for hearing within three years of the date of accident, compensation for the surviving spouse, Bobbie J. Angle-ton, must be denied.” The Assistant Director also held the three minor children were entitled to compensation and awarded compensation at the rate of $218 per week to be divided equally among the children. Additionally, funeral expenses not to exceed $3,200 were awarded.
On August 20, 1990, Bobbie Angleton petitioned the Scott County District Court for judicial review of the Assistant Director’s order. The case was transferred to Neosho County District Court and argued on December 20, 1990. The district court made its ruling by telephone conference call on March 29, 1991, and journalized its decision on May 7, 1991. The district court’s journal entry affirmed the Assistant Director’s order in all respects. The district court judge during the telephone conference call stated he found Roberta Hall’s testimony “inherently unreliable.” When questioned further by Starkan’s attorney about his findings on whether Angleton was smoking marijuana at the time of his death, the district court judge responded:
“I’m saying there — I’m not ruling on whether or not it was a deviation. Well, I guess I can because I have resolved that in my mind to the extent that if the circumstances were as testified to by Roberta Woodward [Hall], I don’t believe that would be a sufficient deviation and I would sustain the Director in that regard as well.
“But, again, that finding is somewhat moot because I have found that there is no good cause to believe that he was in fact smoking marijuana.”
Starkan and its insurance carrier appealed the district court’s decision. Bobbie Angleton cross-appealed.
I.
Starkan raises two issues on appeal which are so interrelated we treat them as one issue. Starkan argues the district court erred in finding that the incident which resulted in Angleton’s death arose out of and in the course of his employment and that the finding was not supported by substantial competent evidence.
Our scope of appellate review for workers compensation cases is the same as the scope of review in other civil cases. K.S.A. 77-623. This court must view the evidence in the light most favorable to the prevailing party. If the district court’s findings of fact are supported by substantial competent evidence, this court is bound by those findings. We have jurisdiction to review all questions of law. Craig v. Electrolux Corporation, 212 Kan. 75, 77, 510 P.2d 138 (1973); Jones v. City of Dodge City, 194 Kan. 777, 779, 402 P.2d 108 (1965). In addition, it is the duty of the courts, district and appellate, to liberally construe the workers compensation statutes “to effect legislative intent and award compensation to the worker where it is reasonably possible to do so.” Poole v. Earp Meat Co., 242 Kan. 638, 643, 750 P.2d 1000 (1988).
We have defined the term “substantial evidence” in the context of workers compensation cases to mean “evidence possessing something of substance and relevant consequence and carrying with it fitness to induce conviction that the award is proper, or furnishing substantial basis of fact from which the issue tendered can be reasonably resolved.” Jones v. City of Dodge City, 194 Kan. at 779.
Starkan contends the claimants should not be awarded compensation because Roberta Hall testified Angleton was smoking marijuana with her at the time of his death and, therefore, his death did not arise out of and in the course of his employment. For support, Starkan cites several federal regulations governing commercial drivers as well as K.S.A. 8-1567. These regulations and K.S.A. 8-1567(a)(4) prohibit a person from operating a vehicle while under the influence of drugs. See 49 C.F.R. §§ 383.51, 391.95, and 392.4 (1991). There is a flaw in Starkan’s logic. It overlooks the fact Angleton was not operating his truck at the time of his death. The Workers Compensation Act provides the employer is not liable if the employee’s “death was substantially caused by the employee’s use of any drugs, chemicals or any other compounds or substances, including but not limited to, any form or type of narcotic drugs, marijuana, stimulants, depressants or hallucinogens” unless they are prescribed for the treatment of an illness by a health care provider. (Emphasis added.) K.S.A. 1991 Supp. 44-501(d). Even if we assume Angleton was smoking marijuana, that alone does not justify denying compensation. Angleton’s death must be substantially caused by his alleged drug use before compensation can be denied or he must have deviated sufficiently from his employment to be off the job at the time of his death.
Pursuant to K.S.A. 1991 Supp. 44-501(a), if an employee is injured “by accident arising out of and in the course of employment . . . the employer shall be liable to pay compensation to the employee.” This court has construed the phrases arising “out of” and “in the course of” employment many times. We have stated:
“The two phrases, arising ‘out op and ‘in the course of’ the employment, as used in our workmen’s compensation act (K.S.A. 1972 Supp. 44-501), have separate and distinct meanings, they are conjunctive and each condition must exist before compensation is allowable. The phrase ‘in the course of’ employment relates to the time, place and circumstances under which the accident occurred, and means the injury happened while the workman was at work in his employer’s service. The phrase ‘out of’ the employment points to the cause or origin of the accident and requires some causal connection between the accidental injury and the employment. An injury arises ‘out of’ employment when there is apparent to the rational mind, upon consideration of all the circumstances, a causal connection between the conditions under which the work is required to be performed and the resulting injury. An injury arises ‘out of’ employment if it arises out of the nature, conditions, obligations and incidents of the employment.” Newman v. Bennett, 212 Kan. 562, Syl. ¶ 1, 512 P.2d 497 (1973).
See Craig v. Electrolux Corporation, 212 Kan. 75; Siebert v. Hoch, 199 Kan. 299, 428 P.2d 825 (1967).
Temporarily ignoring the testimony regarding the marijuana use, let us consider whether the accident causing Angleton’s death arose out of and in the course of his employment. At the time of his death, Angleton was en route to deliver his load of cattle to the feedlot in Leoti. Angleton was making this trip at the direction of his employer, Starkan. He was on the direct route to his designated destination, Leoti. Angleton would not have been driving on this route near Scott City on February 5, 1984, had it not been for his job. If Angleton had not been hauling a valuable load for Starkan, he and his truck would not have caught the attention of Gary and Roberta Hall, who were looking for a truck to hijack, and his death would not have occurred. Clearly the accident occurred in the course of Angleton’s employment.
Next, Angleton’s death arose out of his employment if there is a rational causal connection between the conditions under which the work is required to be performed and the resulting injury. At the time Angleton pulled off the highway, he was driving his load to Leoti in fulfillment of his employment obligations. The Halls spotted Angleton’s truckload of cattle and decided to hijack it. Once Roberta convinced Angleton to stop, Gary shot him in order to carry out their plan to steal the cattle. There is no evidence in the record indicating Angleton was killed for any personal reason. In fact, it is clear he was killed because he was responsible for the Starkan truck and cattle.
If employment exposes the worker to an increased risk of injury of the type actually sustained, the employer is liable for compensation. Transporting valuable cargo for Starkan increased An-, gleton’s chances of being robbed while on the highway more so than if he were driving a passenger car for his own purpose or pleasure. Based upon this, we hold that absent the alleged marijuana episode, Angleton’s death arose out of his employment.
This conclusion is in keeping with our holdings in other cases. For example, in Craig v. Electrolux Corporation, 212 Kan. 75, an employee was shot and killed while waiting in a parking lot for a potential client. The employee’s duties included collecting payments, and he had been observed with a large sum of money by his assailants earlier in the day. The evidence proved the employee was shot because the assailants planned to rob him, although they did not carry out that plan. We held the employer was liable for compensation to the employee’s widow because the nature of the work increased the risk which in fact caused his death.
In contrast, in Siebert v. Hoch, 199 Kan. 299, an employee was shot and killed while he slept on a couch in the employer’s business office. The evidence did not indicate the crime occurred during an attempted burglary, and the employee’s widow failed to prove the death was in any way connected to the employee’s work. Thus, compensation was denied.
Now, let us examine the question of whether the evidence concerning the marijuana use changes our conclusion that the accident resulting in Angleton’s death arose out of and in the course of his employment. Compensation would not be denied if Angleton had stopped to have a cup of coffee or a meal or to assist another trucker who claimed to be having mechanical difficulty. Roberta, however, testified Angleton pulled off the highway because she invited him to smoke marijuana. The district court judge found this testimony to be unreliable and stated, assuming it was true, Angleton’s behavior was insufficient to amount to a deviation justifying denial of compensation.
Bobbie Angleton testified she had never known her husband to smoke marijuana. According to Bobbie, her husband had had “chemical pneumonia” that would have kept Angleton from smoking marijuana. Starkan contends Bobbie’s testimony is self-serving and should be given little weight in contrast to Roberta’s testimony. Starkan further claims the Administrative Law Judge, rather than the district court judge, more accurately assessed the testimony because he had the opportunity to observe the witnesses.
The critical witness in this issue is Roberta Hall. Her testimony in this case was introduced through a transcript of her testimony in the Gary Hall murder trial. Thus, neither the Administrative Law Judge nor the district court judge had the opportunity to observe her. The record supports the district court’s finding that Roberta’s testimony is unreliable and we hold it is not of sufficient weight and reliability to support a finding as to the cause of Angleton’s death or that Angleton’s conduct constituted a deviation from his employment. Thus, we hold Angleton’s death arose in the course of and out of his employment.
II.
On cross-appeal, Bobbie Angleton takes issue with the district court holding that K.S.A. 44-520a(a) bars her claim for compensation. That statute states in part:
“No proceedings for compensation shall be maintainable under the workmen’s compensation act unless a written claim for compensation shall be served upon the employer by delivering such written claim to him . , . within one (1) year after the death of the injured employee if death results from the injury within five (5) years after the date of such accident.”
Bobbie argues this statute of limitations should be tolled from the time of Angleton’s disappearance in February 1984 until the discovery of his death in March 1987. She also contends Angle-ton’s date of death for purposes of workers compensation should be March 8, 1987. Angleton’s death certificate states the date of death as “Mar. 8, 1987 (found),” the date of injury as February 5, 1984, and the date pronounced dead as March 8, 1987.
In response, the other claimants argue the date of death should be February 5, 1984, and there is no dispute over the fact Angleton actually died on that date. Furthermore, they contend K.S.A. 44-520a(a) should not be tolled merely because Bobbie did not know of and could not have discovered Angleton’s death on February 5, arguing that the statute makes no such provision for tolling under these circumstances.
A review of Kansas case law reveals we have been quite strict in construing K.S.A. 44-520a(a) and its predecessor statutes. In Graham v. Pomeroy, 143 Kan. 974, 975, 57 P.2d 19 (1936), we stated that when the time for filing a claim for compensation has passed the right to recover is lost and cannot be revived. Also, in Rutledge v. Sandlin, 181 Kan. 369, 372, 310 P.2d 950 (1957), we held the statutory time to file for compensation ran from the date of the accident regardless of when the resulting injury is discovered. None of our decisions, however, have involved an employee’s undiscovered death arising in the course of and out of his or her employment. We find these facts call for a more realistic approach in keeping with the rule that the Workers Compensation Act be liberally construed to give a worker compensation. Poole v. Earp Meat Co., 242 Kan. at 643.
In this case, Bobbie Angleton knew nothing of the fate of her husband, Delbert, until his body was discovered on March 8, 1987. Delbert’s death was not reasonably ascertainable prior to that date. Thus, Bobbie had no opportunity to file a claim for compensation prior to that date. To strictly construe K.S.A. 44-520a(a) under these circumstances would defeat the purpose of the Workers Compensation Act. We hold that where death occurs to an employee arising out of and in the course of employment, but the fact of death is not ascertained or reasonably ascertainable until a date later than the actual date of death, the limitations of K.S.A. 44-520a(a) do not apply until the death of the employee is ascertained or is reasonably ascertainable.
Bobbie’s claim for compensation and her application for a hearing were timely filed.
The judgment of the district court is affirmed in part and reversed in part. | [
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The opinion of the court was delivered by
ABBOTT, J.:
The plaintiffs sought judgment that certain oil and gas leases had expired. The resolution of that issue depends upon the interpretation of a document entitled “Unitization Agreement.”
The plaintiffs and their predecessors in interest are mineral interest owners who entered into oil and gas leases. Each lease contains a habendum clause, specifying an initial or primary term ranging from one month to five years and a secondary term for “as long thereafter as oil or gas, or either, is produced from said land” or words to that effect. None of the leases specifically provides for entering into a unitization agreement.
In 1975 the plaintiffs entered into an agreement with B.W. Klippel, Jr., and Susan Mason Klippel (the Klippels). The agreement will be referred to as the Klippel Agreement. The Klippel Agreement assembled 12 separate tracts of land, incorporating 13 leases, into a block of acreage covering 1,520 acres. This agreement is entitled “Unitization Agreement — Buffalo Oil and Gas Field — Woodson and Wilson Counties, Kansas.” Prior to entering into the Klippel Agreement, the land covered by the individual leases was in production. After the Klippel Agreement was executed, production continued on some, but not all, of the land covered by the individual leases. All leaseholders allowed the leases to operate as a unit and shared in the royalties from production, at least until this lawsuit was filed.
The plaintiffs and the defendants both filed motions for partial summary judgment. The parties all contend the agreement is unambiguous. The trial court granted the defendants’ motion, “finding that the Unitization Agreement, Buffalo Oil and Gas Field is in fact a pooling or unitizing agreement, and as such, will keep all the underlying leases in force so long as production continues on any one of the unitized leases.”
The agreement reads, in pertinent part:
“UNITIZATION AGREEMENT BUFFALO OIL AND GAS FIELD WOODSON AND WILSON COUNTIES, KANSAS
“Whereas, certain oil and gas leases encompass all, or substantially all, of the commercially productive oil and gas reservoir area underlying the Buffalo Oil and Gas Field, Woodson and Wilson Counties, Kansas; and,
“Whereas, these leases, collectively known hereinafter as the ‘Buffalo Field Unit’, are described and located as follows:
[Descriptions omitted.]
“Whereas, for the purposes of this agreement, it is agreed, by and between the parties hereto, that the following abbreviations shall be adopted and used:
RI Royalty Interest,
ORRI Overriding Royalty Interest,
WI Working Interest; and,
“Whereas, as at the effective date of this agreement, ownership of the mineral interests in and to the aforesaid oil and gas leases is as follows:
Ray C. Martin, et al, lease:
.062500000 RI Union Central Life Insurance Company,
.062500000 RI Mardell S. Pringle,
.054687500 ORRI Mardell S. Pringle,
.820312500 WI B. W. Klippel, Jr., et ux;
jRemaining lease interests omitted.]
“Whereas, each of the several leases set forth above represents a certain proportion of the oil and gas reserves yet to be commercially recovered from the oil and gas reservoir area underlying said Buffalo Field Unit, said proportions being as follows:
Ray C. Martin, et al, lease 5.223798
S. G. Apt, et ux, lease 26.530550
D. N. Johnston, et ux, lease 11.873867
Minnie E. Brock lease 1.650002
Oley G. Apt, et ux, lease 13.581116
L. M. Clark, et al, lease 10.047073
J. S. Wilson, et ux, lease 6.376907
Milo Foster, et al, lease 10.006452
W. E. McGill, et al, lease 5.877062
H. C. Glamser, et ux, lease 5.348474
Fred A. Whitney, et ux, lease 2.234323
Andrew Erickson, et ux, lease _1.250376
100.000000; and,
“WHEREAS, based upon and as determined by the above, ownership of the several mineral interests in and to the aforesaid Buffalo Field Unit is as follows, to-wit:
Of the total oil and gas production from the Buffalo Field Unit, ownership of, and payment for, all Royalty Interest shall be as follows:
Union Central Life Insurance Company .32648737
Mardpll S. Pringle .32648737
Ada W. Apt 5.01395825
Betty Lou Latimer .49474445
Vail A. Van Natta .49474445
Martha Jane Bundy .49474445
Edgar A. Beecher, et ux .20625028
Bobby Eugene Shockley, et ux 3.24132337
O. R. Chapman, et ux .79711338
Ura Louise Glamser .66855925
Noel P. McGregor, et ux .43558738
12.50000000
“Of the total oil and gas production from the Buffalo Field Unit, ownership of, and payment for, all Overriding Royalty Interest shall be as follows:
Mardell S. Pringle .28567645
Aylward Trust Estate No. 2 2.27196832
Marvin E'. Johnston .06015632
Mary Frances Comley .13736228
Betty J. De Coursey .13736228
2.89252565
“Of the total oil and gas production from the Buffalo Field Unit, ownership of, and payment for, all Working Interest shall be as follows:
B. W. Klippel, Jr., ex ux 84.69747435 [sic]
84.60747435
Total mineral interests, Buffalo Field Unit 100.00000000 and,
“WHEREAS,’ it is recognized by all of the parties hereto that oil and gas production from the Buffalo Field Unit has reached a low economic level; that the value of the estimated additional recovery of oil and gas resulting from unitization exceeds the cost of the unitization program provided for herewith; that the proposed unit operations are fair and equitable to all interest owners; that the commercially productive oil and gas reservoir area underlying t}ie Buffalo Field Unit constitutes a common source of supply; that unitization and the production methods to be utilized under such a plan of operation provide greater protection for the general health of the public and for the preservation of the environment; and that the unitized management, operation and further development of the Buffalo Field Unit is economically feasible and reasonably necessary to prevent waste within the reservoir area and thereby increase substantially the ultimate recovery of oil and gas; and,
“Whereas, the effective time and date of the unitization provided for herewith shall be at 7:00 o’clock, A.M., C.D.S.T., on Tuesday morning, July 1, 1975; and,
“WHEREAS, in executing this Unitization Agreement, as provided for hereinbelow, the undersigned, unless excepted, warrant that they are the owners of the percentage interests set opposite their respective names; that they will warrant and defend the same; and that such percentage interests shall continue in effect notwithstanding any previous oral or written agreements to the contrary;
“Now, Therefore, Know All Men By These Presents: in consideration of the mutual benefits to be derived from this unitization and in further consideration of the covenants herein contained, the sufficiency of which is hereby acknowledged, it is hereby agreed, by and between the several parties hereto, that the said Buffalo Field Unit is hereby unitized, all in accordance with and as provided for under the terms, conditions and restrictions set forth in this Unitization Agreement.”
The trial court, in granting summary judgment to the defendants, reasoned;
“I want to start by pointing out that plaintiff has confused the issue by arguing that the habendum clauses of the various leases must be modified in order to keep the leases in effect without production on a particular lease. I agree that absent a true pooling or unitization agreement, the leases cannot be kept in production without a modification of the habendum clause. However, a pooling agreement or unitization agreement by [its] very nature keep[s] leases in force by allocating production to all the leases within the unit regardless whether any individual lease has actual production.
“A clear reading of the agreement itself, establishes the following:
1. The agreement is entitled:
Unitization Agreement
Buffalo Oil and Gas Field
Woodson and Wilson Counties, Kansas
I recognize the title isn’t controlling. However, that doesn’t mean it can’t be considered in regard to the intent of. the parties. Here, it can readily be said that this refers to an agreement unitizing the Buffalo Oil and Gas Field.
2. The first two ‘whereas’ clauses recognize that the described leases ‘encompass all, or substantially all’ of the oil and gas reservoir underlying the Buffalo Oil and Gas Field. Again, these clauses would seem to point to the fact stated, referring to the complete reservoir, of oil and gas.
3. The third and fourth ‘whereas’ clauses set out the specific ownership interest of the mineral interest holders for the obvious purpose of identifying the owners of the various interests.
4. The fifth ‘whereas’ clause purports to set forth the proportion of the reserves of the Buffalo Field Unit each lease is entitled to. It is worth noting that the reference is to the Buffalo Field ‘Unit’, and by their subsequent execution of the agreement, the owners have acknowledged their proportional interest in the underlying reservoir.
5. The sixth ‘whereas’ clause combines the ownership interests with the agreement on the apportionment with the result that the interest of each mineral interest holder in the ‘underlying reservoir’ is established. Again, by their execution of the agreement, the interest holders have acknowledged an interest in the underlying reservoir separate from their interest in their own leases.
6. The seventh ‘whereas’ clause recites the recognition and (I would submit) the intent of the parties to the agreement to acknowledge that the oil and gas reservoir underlying the Buffalo Field Unit constitutes a ‘common’ source of supply. The clause further speaks to the advantage of not only unitized management, but operation and further economic development of the Buffalo Field Unit. This clause goes far beyond a simple ‘management’ agreement or ‘division order[’] as is argued by plaintiff.
7. The eighth ‘whereas’ clause relates to effective date and is not material to the issues being decided.
8. The ninth ‘whereas’ clause makes reference to the percentage interests of the parties as set out by their respective signatures and acknowledges that they intend for those percentage interests to remain in effect. Again, it is interesting to note that the interests they intend should remain in effect are not the interests they have in the individual leases, but are identical to their interests in the ‘several mineral interests in and to the Buffalo Field Unit’ as set out in the sixth ‘whereas’ clause.
9. Finally, we have the ‘Now, therefore’ clause that clearly expresses the intent of the parties to the agreement to declare the Buffalo Field Unit ‘unitized’ in accordance with the terms of the unitization agreement, all of which have just been discussed.”
The central issue before this court is one of contract construction. “The construction of a written instrument is a question of law, and the instrument may be construed and its legal effect determined by an appellate court.” Godfrey v. Chandley, 248 Kan. 975, Syl. ¶ 1, 811 P.2d 1248 (1991); Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, Syl. ¶ 1, 754 P.2d 803 (1988). In Rook v. James E. Russell Petroleum, Inc., 235 Kan. 6, Syl. ¶ 1, 679 P.2d 158 (1984), this court reviewed the general rules governing the construction of oil and gas leases:
“[T]he intent of the parties is the primary question; meaning should be ascertained by examining the documents from all four corners and by considering all of the pertinent provisions, rather than by critical analysis of a single or isolated provision; reasonable rather than unreasonable interpretations are favored; a practical and equitable construction must be given to ambiguous terms; and any ambiguities in a lease should be construed in favor of the lessor and against the lessee, since it is the lessee who usually provides the lease form or dictates the terms thereof.”
The defendants ask this court to uphold the trial court’s finding that the parties’ intent and purpose was to execute a unitization agreement. A unit or unitization agreement is “[a]n agreement or plan of development and operation for the recovery of oil and gas made subject thereto as a single consolidated unit without regard to separate ownerships and for the allocation of costs and benefits on a basis as defined in the agreement or plan. ” Williams & Meyers, Manual of Oil and Gas Terms 1315 (8th ed. 1991). This court has held that
“[u]nit operation of oil and gas leases involves the consolidation or merger of one or more oil and gas leases and the designation of one or more of the parties as operator. It permits the location of induction and production wells so as to secure the most scientific use of natural or artificial energy in the reservoir in the production of oil and gas.”
“ ‘Unit operation’ means not only the process of placing a number of oil and gas leases together, centralizing management, pumping the wells and dividing the royalty proceeds according to schedule, it also means the good faith operation and prudent development of the unit.” Parkin v. Kansas Corporation Comm’n, 234 Kan. 994, Syl. ¶¶ 4, 6, 677 P.2d 991 (1984).
See Veverka v. Davies & Co., 10 Kan. App. 2d 578, Syl. ¶ 3, 705 P.2d 558 (1985) (“Unitization is a means of consolidating development of property overlying a mineral reservoir into a single production unit.”); Klippel v. Beinar, 222 Kan. 681, 685, 567 P.2d 867 (1977). See generally 1 Kramer & Martin, The Law of Pooling and Unitization §§ 1.02, 17.02[2] (3d ed. 1991).
The plaintiffs argue the Klippel Agreement is a joint management agreement modifying the royalty clause of each lease, and the agreement’s effect is to unitize the landowners’ royalty interest in order to permit unit management. The plaintiffs suggest the essence of the agreement is that
“the unit operator is relieved from any liability for conversion and trespass concerning unit operations — so long as he pays in accordance with the percentage interests established in the Agreement (the conversion problem) and properly pursues unit management (the trespass problem).”
A joint management or operating agreement has been defined as:
“(1) [a]n agreement between or among interested parties for the operation of a tract or leasehold for oil, gas and other minerals. This type of agreement is frequently entered into before there has been any development. Typically the agreement provides for the development of the premises by one of the parties for the joint account. The parties to the agreement share in the expenses of the operations and in the proceeds of development, but the agreement normally is not intended to affect the ownership of the minerals or the rights to produce, in which respects, among others, the joint operating agreement is to be distinguished from a unitization agreement and from a mining partnership.
“(2) An agreement between or among adjoining landowners or lessees concerning the development of a common pool.” Williams & Meyers, Manual of Oil and Gas Terms 622-24.
In the alternative, the plaintiffs contend the Klippel Agreement functions as a division order, “by specifying and warranting how each interest owner will share in production from the unit area. This would permit the lessee to commingle production from the unit area and sell it from a common tank battery to a crude oil purchaser.” A division order is defined as:
“[a] contract of sale to the purchaser of oil or gas. The order directs the purchaser to make payment for the value of the products taken in the proportions set out in the division order.
“Even though the lessee by the terms of the lease has authority to dispose of any products produced, the purchaser usually requests the operator to furnish complete abstracts of title which the purchaser causes to be examined, after which a division order is prepared by the purchaser on the basis of the ownership shown in the title opinion prepared after examination of the abstracts. The purchaser usually requires that the division order be executed by the operator, the royalty owners and other persons having an interest in the production. When the division order is executed and returned to the purchaser, payment is commenced for the products removed. The division order is typically terminable at the will of either party.” Williams & Meyers, Manual of Oil and Gas Terms 334.
The defendants point out several items not contained in the agreement: An oil or gas purchaser is not a party to the agreement as is typical with division orders. Production shares are established without reference to the location of unit wells. If a lease terminates, theré is no apparatus for changing the production allocation percentages. There is no express provision allowing a leaseholder to withdraw from the agreement if production ceases on the leaseholder’s land.
In ascertaining the parties’ intent whether the document is a unitization agreement, a joint management agreement, or a division order, the document’s title can be considered. See Skelly Oil Co. v. Cities Service Oil Co., 160 Kan. 226, 230, 160 P.2d 246 (1945)(In a case involving the interpretation of a document entitled “Sale of Oil and Gas Royalty,” this court stated: “While it is true that the title of the instrument is not altogether controlling, yet with such a title the contents of the instrument must make it clear that it is something else than what its title indicates.”). Here, the trial court found the contents of the Klippel Agreement did not indicate it was something other than its title, “Unitization Agreement.”
This court is not required to accept the trial court’s construction of the contract. See Farrell v. General Motors Corp., 249 Kan. 231, Syl. ¶ 2, 815 P.2d 538 (1991) (“Regardless of the construction given a written contract by the trial court, an appellate court may construe a written contract and determine its legal effect.”). Nonetheless, the trial court’s reasoning is persuasive. After reviewing the Klippel Agreement, we agree with the trial court that the Klippel Agreement is a unitization agreement.
The plaintiffs next argue that even if we hold the agreement to be a unitization agreement, the trial court erred in finding that a unit agreement, by its very nature, keeps individual leases in effect if there is production on any of the unitized leases. The plaintiffs contend the Klippel Agreement does not modify the habendum clause included in each oil and gas lease. Each habendum clause specifies an initial or primary term ranging from one month to five years and a secondary term for “as long thereafter as oil or gas, or either, is produced from said land” or words to that effect. All 13 leases were into the secondary term when the leaseholders entered into the Klippel Agreement. The plaintiffs assert that because the primary term had expired, each lease’s continuing validity “depends upon whether there has been actual continuous production in paying quantities from the leased land.” The plaintiffs essentially raise three arguments: whether production for each lease must be from the individual tract, whether production was in paying quantities, and policy considerations.
The plaintiffs argue that production for each lease must be from the individual tract and not from the unit as a whole, unless there is express agreement to the contrary. In support of this argument, the plaintiffs cite Friesen v. Federal Land Bank of Wichita, 227 Kan. 522, 608 P.2d 915, disapproved in part Classen v. Federal Land Bank of Wichita, 228 Kan. 426, 617 P.2d 1255 (1980); Stamper v. Jones, 188 Kan. 626, 364 P.2d 972 (1961); and Somers v. Harris Trust & Savings Bank, 1 Kan. App. 2d 397, 566 P.2d 775 (1977).
In Stamper, the plaintiffs owned six separate 80-acre tracts, upon which they executed oil and gas leases to the defendants. The validity of each lease depended upon continued production. Individual well reports were not available because monthly barrel tests on each well had not been kept and because the oil from each well producing on the six tracts had been pumped into one common tank battery. There was evidence the existing wells were not adequately draining the acreage. The plaintiffs filed suit, alleging breach of the implied covenant to develop and requesting cancellation of the leases. The trial court ordered the defendants to drill on the lease described in the third cause of action. If this well was a commercial producer, the defendants were then to drill on the lease in another quarter section. The court ruled in the defendants’ favor on the other four causes of action.
On appeal, the defendants argued there was not sufficient evidence to support the trial court’s decision. After concluding the evidence was sufficient, this court stated the trial court erred in making one cause of action dependent upon another.
“While this lawsuit does involve the same lessors and lessees as parties, each lease was separate and distinct from any other in its terms, and was made the subject of an independent cause of action. Neither the fact that the parties are the same, nor the fact that the tracts of land covered by the leases in question embrace oil-bearing formation comprising a common source of supply, alter the independent legal nature of the leases in question or make them dependent upon one another.” 188 Kan. at 640.
“The very purpose in dividing one’s real property into eighty-acre units for leasing purposes is to assure development of each unit. Thus production on one lease could not hold another lease beyond the primary term in the absence of independent development or production on such other lease. The same is true of the implied covenant to develop. [Citation omitted.] One lease covering an eighty-acre tract of land is in no way dependent upon a lease on another eighty-acre tract of land, even though it may join, or lie adjacent thereto, or involve the same parties, absent a binding agreement between the parties making such leases interdependent.” 188 Kan. at 641.
Stamper is easily distinguished from the case at hand. There was no .mention of a unit or unitization agreement in Stamper.
In Somers, the Court of Appeals construed a unitization agreement and noted: “The majority rule elsewhere is that where a portion of an oil and gas lease is committed to a unit, production anywhere in the unit extends the term of the entire lease. [Citations omitted.] The rule is based on conservation and public policy.” 1 Kan. App. 2d at 400.
The Court of Appeals adopted the majority rule, reasoning that it was “reasonable and just under the circumstances and one which should be adopted particularly where, as here, all affected parties have agreed to the unitization.” 1 Kan. App. 2d at 402. The court noted that the heart of the unitization agreement contained the following language:
“ ‘The production of unitized substances from the unit area through any well or wells shall be considered for all purposes as production of oil and gas from the land covered and affected by each oil and gas lease affecting any of the land within the unit area and production from any part of said unit area shall perpetuate all oil and gas leases whether or not the lands covered by any particular such oil and gas lease are productive or nonproductive.’ ” 1 Kan. App. 2d at 402.
The plaintiffs point out the unitization agreement in Somers involved an express agreement that production anywhere within the unit was sufficient to extend the lease for any individual tract in the unit. The plaintiffs cite Friesen to show this court’s acknowledgment of that point. The Friesen court noted that in Somers, “all of the lessors and lessees in the unit had expressly agreed that production anywhere in the unit would extend all leases in the unit.” Friesen, 227 Kan. at 525-26.
In discussing unitization agreements, Kansas cases differentiate between oil and gas leases and mineral reservations in a deed. Edmonston v. Home Stake Oil & Gas Corp., 629 F. Supp. 620, 623-24 (D. Kan. 1986); see Friesen v. Federal Land Bank of Wichita, 227 Kan. 522; Stratmann v. Stratmann, 204 Kan. 658, 465 P.2d 938 (1970), disapproved in part Classen v. Federal Land Bank of Wichita, 228 Kan. 426, 617 P.2d 1255 (1980); Palmer v. Brandenburg, 8 Kan. App. 2d 154, 651 P.2d 961 (1982), rev. denied 233 Kan. 1092 (1983); Somers v. Harris Trust & Savings Bank, 1 Kan. App. 2d 397; Annot., 9 A.L.R.4th 1121, 1131 n.13. Because this case involves oil and gas leases, the cases involving mineral reservations in a deed are distinguishable.
The defendants cite Rogers v. Westhoma Oil Company, 291 F.2d 726 (10th Cir. 1961), and Klippel v. Beinar, 222 Kan. 681, 567 P.2d 867 (1977), to support their argument that production from any tract in the unit extends all leases within the unit, unless the parties expressly state otherwise. Both cases were decided before Somers. In Klippel, this court “roughly summarized” unitization’s legal results. One of those results is “[t]he life of the lease is extended as to all included tracts beyond the primary term and for as long as oil, gas or other minerals are produced from any one of the tracts included.” 222 Kan. at 685.
The Rogers court determined the general rule was “that production from any part of a consolidated or pooled unit perpetuates all leases within the unit, even as to ununitized acreage, unless the leases provide to the contrary.” 291 F.2d at 729.
The plaintiffs argue unitization agreements are not standardized; agreements vary, depending upon the parties and their needs. Thus, the plaintiffs ask the court to be cautious in reading the same terms into all unitization agreements.
The plaintiffs urge this court to follow the approach in Clark v. Perez, 679 S.W.2d 710 (Tex. App. 1984). In Clark, the Perezes entered into two oil, gas, and mineral lease agreements, dated 1964 and 1966, with Clark. The habendum clause for both leases specified the primary term was for five years and the secondary term was for as long as oil was produced. In 1968, the parties executed a lease amendment to merge and amend the prior leases. The lease amendment provided that the lease could not continue for more than ten years (from 1968) unless “mining operations” were or had been conducted.
The Perezes filed suit, alleging that all three agreements had been terminated. One of their arguments was the lease amendment did not modify the habendum clauses of the 1964 and 1966 leases. (The original leases terminated in 1971 if there was no production, and there was none.) The trial court terminated the leases.
On appeal, Clark argued the lease amendment modified the habendum clauses of the 1964 and 1966 leases. The Texas Court of Appeals affirmed the trial court as to termination of the leases, reasoning:
“It is well settled that an oil and gas lease in Texas will be strictly construed against the lessee. [Citation omitted.] With an irreconcilable conflict between the habendum clause and recitals in a subsequent amendment, the recitals must yield. [Citation omitted.] In construing oil and gas leases, the habendum clause will control unless properly modified by other provisions, and the fixed term therein stated should not be extended by words found elsewhere in the lease not certainly directed to the modification of the habendum clause. [Citation omitted.]
“On the other hand, this is not to say that an habendum clause can never be modified, as a subsequent instrument may provide elsewhere for the enlargement of the term stated in the habendum. [Citation omitted.] It is always a question of determining the intent of the parties from the entire instrument.
“When there is a certain answer as to the term of the lease, that answer can not be changed with words elsewhere not specifically directed to the term of the lease.” 679 S.W.2d at 714.
The plaintiffs argue that “[n]othing in the Klippel Agreement even begins to rise to the level of language which is ‘specifically directed to the term of the lease’ or ‘certainly directed to the modification of the habendum clause.’ ”
Here, the document in question is a unitization agreement, rather than a lease amendment. The parties’ intent in executing the two documents would differ. Here, the unitization agreement is silent rather than stating a conflicting term. We are not persuaded the Clark decision is applicable to the case at bar.
The plaintiffs’ second argument concerns whether production has been “in paying quantities.” The plaintiffs admit this appeal involves issues of contract construction; however, they suggest the underlying problem is the Klippels are using marginal production on one of the 12 tracts of land to “hold hostage” the plaintiffs’ leases. The defendants assert it was uncontroverted at summary judgment that there has been production on two other tracts of land within the past five years. This is accurate because the plaintiffs did not comply with Supreme Court Rule 141 (1991 Kan. Ct. R. Annot. 117) in controverting the defendants’ facts. However, production some time within the past five years is not proof of continuous production or of production in paying quantities.
According to the plaintiffs, production had decreased from 5.26 barrels per day in 1987 to 1.68 barrels per day for the first five months of 1990. Although the plaintiffs suggest production has not been “in paying quantities,” they do not fully brief this argument. The plaintiffs speculate that the defendants’ actions have not been in good faith, but have offered no proof.
The defendants assert that this argument was not brought up at the trial court level and that the plaintiffs cannot raise it now. See Plummer Development, Inc. v. Prairie Sate Bank, 248 Kan. 664, Syl. ¶ 3, 809 P.2d 1216 (1991) (“The general rule is that a point not presented to the trial court will not be considered for the first time on appeal.”); Mitchelson v. Travelers Ins. Co., 229 Kan. 567, Syl. ¶ 2, 629 P.2d 143 (1981) (“Where the case records reflect no genuine issue of material fact before the trial court, and summary judgment is entered, a party cannot raise a new issue for the first time in the appellate court.”). The trial court did not consider the issue, and we will not consider it on appeal. It is an issue the plaintiffs can raise at the trial court level at any time in the future.
The plaintiffs’ third argument centers around policy considerations. The plaintiffs contend some things that occur under the “guise” of unitization are not good. In support of this, the plaintiffs cite Parkin v. Kansas Corporation Comm'n, 234 Kan. 994, 677 P.2d 991 (1984). Although a compulsory unitization case, the questions asked are pertinent.
“Is it prudent for an operator of a unit this large to sit for ten years pumping six wells — five of them clustered together — while leaving large areas untried? Are the six wells now being pumped adequate to produce the oil underlying the entire 5800 acres, much of which is over a mile from the nearest well? Does such operation prevent waste, conserve oil and gas and protect the correlative rights of all of the persons entitled to share in the production irom this unit?” 234 Kan. at 1010.
The plaintiffs cite a Texas case, Amoco Production Co. v. Underwood, 558 S.W.2d 509, 512-13 (Tex. Civ. App. 1977), to uphold the proposition that “[u]nitization can be used to hold large blocks of acreage with minimal production.”
In urging this court to strictly enforce the lease, habendum clause against the lessee, the plaintiffs point out that the reasons Kansas courts have done so in the past still are applicable. In Reese Enterprises, Inc. v. Lawson, 220 Kan. 300, 313, 553 P. 2d 885 (1976), this court stated:
“At first glance, it would appear that the self-interest of the lessee would provide protection for the lessor. If the lease ceased to be a profitable operation it would appear to be to the interest of the lessee to abandon the project, and it would appear to be unlikely that the lessee would have any interest in continuing to operate at a loss. This conclusion, however, does not take into account the very real factor that the lessee may be interested in preserving his interest for speculative purposes. He may consider it to be to his economic advantage to continue a marginal or losing operation in order to take advantage of possible discoveries in formations other than the formation from which he is producing. He may also anticipate a change in marketing conditions or market prices of oil or gas.”
The plaintiffs also note that while some states offer statutory protection for landowners entering into voluntary unitization agreements, Kansas does not. In Kansas, landowners’ only protection is the contract itself and the court’s interpretation of it. Therefore, the plaintiffs claim this court should not imply terms into unitization agreements. The defendants, however, point out that implying terms into unitization agreements is not a new concept. Many terms have been implied into unitization agreements, e.g., the implied covenants to explore, develop, or market
The plaintiffs argue that in the following cases, this court “has treated the habendum clause as a special limitation on the grant and has required express language to change the effect of the clause.” See Reese Enterprises, Inc., 220 Kan. at 309 (“court of equity has no power to extend a lease beyond the term which the parties themselves have fixed by their written contract”); Baldwin v. Oil Co., 106 Kan. 848, Syl. ¶ 1, 189 Pac. 920 (1920) (although lessee did not complete the well before the end of the primary term because of “water failure, muddy roads, storms, sickness of employees, or inability to get casing as a result of the action of the government,” the court terminated the lease); Elliott v. Oil Co., 106 Kan. 248, 252-53, 187 Pac. 692 (1920) (lessee ceased production during the primary term of the lease because it was unable to find a market for the gas; the court terminated the lease because the lease did not provide for the contingency that devéloped wells might be unproductive for lack of a market).
The plaintiffs maintain that if the parties wanted production from anywhere within the unit to extend the term of the leases, it would have been included in the agreement. The plaintiffs suggest including such is not an uncommon occurrence and cite several cases in which the agreement expressly provided that production anywhere in the unit would perpetuate all leases within the unit. See Edmonston v. Home Stake Oil & Gas Corp., 243 Kan. 376, 381, 762 P.2d 176 (1988); Martin v. Kostner, 231 Kan. 315, 320, 644 P.2d 430 (1982); Veverka v. Davies & Co., 10 Kan. App. 2d 578, 579, 705 P.2d 558 (1985); Somers v. Harris Trust & Savings Bank, 1 Kan. App. 2d 397, 402, 566 P.2d 775 (1977).
In commenting upon the majority rule adopted by the Somers court, plaintiffs’ counsel, relying on his Kansas Oil and Gas Handbook, suggests that
“[p]erhaps a more appropriate basis for the rule is contract. The lessor and lessee, by contract, can specify what will, or will not, extend the lease beyond the primary term. The lease may contain a pooling or unitization clause which permits the lessee to unilaterally extend the area from which the required production can be obtained to perpetuate the lease beyond its primary term. . . . Likewise, the lessor can limit the lease area which will be held by production.” 1 Pierce, Kansas Oil and Gas Handbook § 9.21, pp. 9-20 (1986).
See also 2 Kramer & Martin, The Law of Pooling and Unitization § 20.03[5] (3d ed. 1991) (focus of Kansas courts changed from intent of the parties to conservation of natural resources).
Additionally, the plaintiffs contend
“[t]he Klippel Agreement has . . . operated at the expense of the public. Had the landowners terminated the Agreement at an earlier date, they could have leased their land to other operators who may have been more interested in searching for oil and gas instead of holding large blocks of leases for speculation on the next oil boom.”
Consequently, the plaintiffs argue this court should hold that unitization agreements will extend the stated duration of the leases only if expressly so provided in the unitization agreement. Such a holding, according to the plaintiffs, will not have an adverse impact upon the conservation of oil and gas because this is a contract case. The outcome of this case, as with all contracts, is dependent upon the specific terms of the contract being construed.
Although the plaintiffs raise compelling concerns, the defendants raise a stronger consideration: “To require a unit to have a well on each individual tract would frustrate the whole of efficient and economical development of the common oil or gas reservoir.” This consideration is consistent with the majority rule, which states that absent an express agreement to the contrary, production within the unit will perpetuate the individual leases within the unit. For a discussion of the majority rule, see 2 Kramer & Martin, The Law of Pooling and Unitization § 20.02[1]; Annot., 35 A.L.R.4th 1167.
We see no reason to depart from the majority rule. Thus, our interpretation of the contract is the same as the trial court’s: Production within the unit will perpetuate the individual leases within the unit.
The plaintiffs contend that regardless of this court’s decision on the habendum clause issue, they have the authority to terminate the Klippel Agreement because the agreement does not specify its duration or when it will expire. According to the plaintiffs,
“[t]he parties agreed that unit operations could take place so long as each party consented to continuing unit management. . . . Instead of trying to anticipate each set of circumstances that might give rise to termination, the lessor/landowners, and the lessee/unit operator retained a continuing right to terminate the agreement at any time — subject to a reasonable notice obligation.”
The defendants argue the plaintiffs err because the plaintiffs isolate the Klippel Agreement from the leases. In support of their argument, the defendants cite West v. Prairie State Bank, 200 Kan. 263, Syl. ¶ 3, 436 P.2d 402 (1968). The West court stated:
“Where two or more instruments are executed by the same parties contemporaneously, or even at different times in the course of the same transaction, and concern the same subject matter, they will be read and construed together so far as determining the respective rights and interests of the parties . . . .”
Although the same parties are not involved and the leases were executed decades before the unitization agreement, the oil and gas leases would come under the West rule.
In Amortibanc Investment Co. v. Jehan, 220 Kan. 33, Syl. ¶ 2, 551 P.2d 918 (1976), this court held:
“Where ambiguity or uncertainty is involved in an agreement, the intention of the parties is not ascertained by resort to literal interpretation, but by considering all language employed, the circumstances existing when the agreement was made, the object sought to be attained, and other circumstances, if any, which tend to clarify the real intention of the parties.”
Applying the Amortibanc Investment Co. holding to the facts at hand is helpful. The Klippel Agreement refers to the leases; the habendum clause of each lease specifies a fixed primary term and a secondary term; and the secondary term extends the duration of the lease as long as production continues. The Klippel Agreement relies upon the leases for its existence; the agreement must be read in conjunction with the leases. Thus, the Klippel Agreement has the same termination date as the leases.
The plaintiffs do not have the authority to terminate the Klippel Agreement so long as any lease in the unit is producing oil or gas pursuant to the terms of the applicable lease.
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The opinion of the court was delivered by
Abbott, J.:
This is a personal injury action. The issues involve whether The Kansas Power and Light Company (KP&L), the defendant, is liable for the plaintiff’s injuries and for the damages awarded.
The plaintiff, Raymond D. Wahwásuck, was employed as a laborer by A & G Underground (A&G). A&G, a trenching company, contracted with various public utilities to dig and lay power lines. Southwestern Bell Telephone Company employed A&G to lay underground telephone cable in a utility easement located in a residential area of Lawrence. Two of KP&L’s lines were buried in the easement. One line was a 7,200-volt line and the other, a 120-volt line.
On December 3, 1987, A&G began its trenching operation. The person who operates the trenching machine is seated upon the machine. The digging tool is at one end of the machine. Wahwasuck was standing at the opposite end of the machine, approximately 10 to 15 feet away. Wahwasuck was wearing his everyday working attire, and he was not touching anything, other than the ground upon which he was standing. The trenching machine “intercepted” the 120-volt line. Those present testified concerning the ensuing noise and sparks.
Simultaneous with the severing of the power line, Wahwasuck fell to the ground. Wahwasuck described the sensation as being knocked to the ground by electric shock. He was unable to get up and rolled around on the ground, holding his knee. The testimony of his co-workers, who were present when the line was severed, confirmed his story. When the sensation ceased, his coworkers came to his assistance, and he was taken to the hospital. Wahwasuck’s injury involved the patellar tendon separating from the tibia. Dr. William Bailey, who treated Wahwasuck, testified that a sudden severe trauma caused the injury. The doctor performed surgery to reattach the patellar tendon to the tibia.
Thé jury awarded Wahwasuck $200,000 in damages, assessing 99 percent of the fault to KP&L and 1 percent of the fault to Wahwasuck’s employer.
I. CAUSATION AND FORESEEABILITY
KP&L’s argument here is two-fold: Wahwasuck failed to prove a causal connection between KP&L’s failure to mark the line properly and Wahwasuck’s injury, and Wahwasuck did not prove his injury was foreseeable. Based upon this premise, KP&L contends that the trial court erred in denying its motions for directed verdict, for judgment notwithstanding the verdict, and for a new trial.
The standard for appellate review of these three motions is well established.
“In ruling on a motion for directed verdict, the trial court as well as the appellate court must resolve all facts and inferences reasonably to be drawn from the evidence in favor of the party against whom the ruling is sought. Where reasonable minds could reach different conclusions based upon the evidence, the motion must be denied and the matter submitted to' the jury. The same test is applicable to a motion for judgment notwithstanding the verdict.” Brown v. United Methodist Homes for the Aged, 249 Kan. 124, Syl. ¶ 1, 815 P.2d 72 (1991).
“The granting of a new trial is a matter of trial court, discretion and, as with all discretionary matters, will not be disturbed on appeal except by a showing of abuse of that discretion.” State v. Brown, 249 Kan. 698, Syl. ¶ 1, 823 P.2d 190 (1991); see Douglas v. Lombardino, 236 Kan. 471, 487, 693 P.2d 1138 (1985). “The test on appellate review of whether the trial court abused its discretion is whether no reasonable person would agree with the trial court. If any reasonable person would agree, appellate courts will not disturb the trial court’s decision.” Anderson v. Heartland Oil & Gas, Inc., 249 Kan. 458, Syl. ¶ 7, 819 P.2d 1192 (1991).
In its memorandum decision denying KP&L’s motions for judgment notwithstanding the verdict and for a new trial, the trial court quoted with approval American Jurisprudence’s discussion of negligence and its relationship to electricity.
“To recover for injuries sustained through electricity, it is not enough that the defendant is shown to have been negligent, but the fact must be established that some legal injury resulted to the plaintiff as a proximate result of the negligence. . . . [T]he proximate cause of an injury has been defined as that which, in a natural and continuous sequence, unbroken by any new, independent cause, produces the injury, without which such injury would not have occurred.
“The negligence of an electric company . . . engaged in the transmission or use of electricity cannot, according to the generally accepted test, be said to be the proximate cause of an injury within the law of negligence unless, under all the circumstances, the injury might have been reasonably foreseen by a person of ordinary intelligence and prudence. It is not enough to prove the injury is a natural consequence of its negligence; it must also have been the probable consequence. . . . [T]here is no duty of care to safeguard against occurrences that cannot be reasonably expected or con templated. . . . If . . . the injury follows as a direct consequence of a negligent act or omission, it cannot be said that the company is not responsible therefor because the particular injury could not have been anticipated.” 26 Am. Jur. 2d, Electricity, Gas, and Steam § 47-48, pp. 256-58.
“Although usually the issue of proximate cause is a question of fact for the jury [citation omitted], it becomes a question of law when all evidence relied upon by a party is undisputed and susceptible of only one inference. [Citation omitted.]” St. Clair v. Denny, 245 Kan. 414, 420, 781 P.2d 1043 (1989). KP&L argues it is liable only if electricity shocked Wahwasuck. KP&L then contends it was undisputed that electricity could not have flowed to where Wahwasuck was standing when the power line was severed. Therefore, according to KP&L, Wahwasuck failed to prove causation.
Is the evidence here undisputed and susceptible of only KP&L’s interpretation? The trial court did not agree with KP&L, concluding:
“The trenching tool contacted the line as a direct result of the failure to properly mark the line. This is easily established by the evidence and is not disputed.
“Had electricity flowed through the metal of the machine into the workman who was operating the machine we could have had an event entirely explainable within our common or ordinary experience and understanding.
“What did happen is all the same events except the electricity took an unexplained course. A workman who was not in contact with the machine was injured. Somehow electric current flowed from the broken line to this workman to cause injury. The evidence does not give us a scientifically acceptable explanation of how the electricity took the path that it took. The evidence is overwhelming that it did happen.
“My conclusion is that it is not necessary under facts such as these for the'injured worker to have a precise scientific explanation for what occurred.”
The record supports the verdict. There was evidence about the unpredictable nature of electricity. Additionally, the earth can be a conductor of electricity, although the earth is not as good a conductor as metal. The ground was not tested to determine if it had metal in it. There also was a metal conduit in the vicinity of Wahwasuck. There was testimony of frost on the ground, which, as a form of moisture, could serve as a conduit. The jury could have found the line was buried some six inches below the surface. As Wahwasuck points out, KP&L did not prove it was scientifically impossible for Wahwasuck to have received an electric shock.
Wahwasuck also asserted that his injury could have been caused by sudden movement, that is, when he attempted to run from the danger and fell. He clearly raised that issue throughout the discovery proceedings, at pretrial, and when instructions were discussed. We do not read the plaintiff’s testimony as inconsistent with that position. Whether the plaintiff thought his knee was injured by electricity and not by sudden movement is immaterial under the facts of this case.
It is undisputed that Wahwasuck’s injury occurred when the line was cut. He testified that, when the line was severed, he saw sparks and blue smoke. His co-workers’ testimony was similar. When the line was cut, Wahwasuck turned around as if he was attempting to get away. He fell down four times and, when rolling around on the ground, held his leg. At that time, the only KP&L line in the easement of which the plaintiff was aware was the 7,200-volt line.
The trial court also determined that the foreseeable event, digging in the hole, occurred: “The line wasn’t adequately marked. The trencher dug into the line and broke it as any reasonable person would have predicted. An injury occurred to a workman on the trenching crew.”
KP&L asserts that the trial court misstated the law: “[[T]he thing which must be foreseeable ... is the injury to plaintiff, and not the act of severing the line.” In Henderson v. Kansas Power & Light Co., 184 Kan. 691, 700, 339 P.2d 702 (1959), this court held:
“The test for negligence or the absence of negligence on the part of the defendant was not whether it should have anticipated the particular act from which the injury resulted, but whether it should have foreseen the probability that injury might result from any reasonable thing that might be done upon [the] property by people who had a right to go there, either for work, pleasure or business. [Citations omitted.]”
Regarding foreseeability, in Folks v. Kansas Power & Light Co., 243 Kan. 57, 65, 755 P.2d 1319 (1988), this court also stated that
“[i]t is the duty of electric companies to guard against contingencies which can be reasonably foreseen and anticipated, and it is not necessary that the precise injury should have been anticipated so long as the probability of injury to someone who had a right to be in the vicinity might have been reasonably anticipated.”
KP&L also argues the injury was not foreseeable because of the remoteness of Wahwasuck’s location from where the line was severed. There was testimony that Wahwasuck was 10 to 15 feet behind the trencher immediately before the line was cut.
KP&L contends that to hold it liable for Wahwasuck’s injuries elevates KP&L to the status of an insurer, which is contrary to Kansas law. See Wilson v. Kansas Power & Light Co., 232 Kan. 506, 513, 657 P.2d 546 (1983); Henderson, 184 Kan. at 696. KP&L bases its argument solely on the testimony of its expert witness, the only expert witness KP&L deems qualified to have testified. KP&L’s expert testified that electricity, as a matter of physical law, does not travel through ground in the absence of a conductor or circuit. KP&L claims that “if such a miraculous event did occur ... , it could not have been foreseen by [KP&L], as it was outside the ‘usual experience of mankind.’ ”
KP&L’s argument is not persuasive. The record supports the trial court’s finding that it was reasonable for KP&L to have anticipated the probability of injury to Wahwasuck, who was in the vicinity and had a right to be in the vicinity.
The jury was instructed “to determine the weight and credit to be given the testimony of each witness . . . [and] to use common knowledge and experience.” Because the jury followed these instructions and did not rely totally upon KP&L’s expert, it cannot be said that the jury ignored the evidence. Here, reasonable minds could reach different conclusions, based upon the evidence, about what caused Wahwasuck’s injury. Furthermore, Wahwasuck’s injury was foreseeable. Therefore, the trial court did not err in denying KP&L’s motions.
II. EXPERT TESTIMONY OF ROBERT ELLIOTT
Prior to trial, KP&L filed a motion in limine, objecting to Robert Elliott’s qualifications to testify on several matters, including application of the National Electrical Safety Code (NESC) to KP&L’s policies and procedures on marking underground lines and to KP&L’s employee safety manual. During trial, the trial court allowed KP&L’s counsel to voir dire Elliott about Elliott’s qualifications as an expert. After voir dire, the trial court ruled Elliott was qualified to offer expert testimony about interpreting and applying the NESC.
Elliott testified as follows: The NESC, which is applicable to KP&L, sets forth minimum, but mandatory, safety standards for underground excavation. Under the section “Underground Lines” and the subsection “Excavation,” the NESC provides: “Cables and other buried utilities in the immediate vicinity shall be located, to the extent practical, prior to excavating.” The NESC has not defined the term “immediate vicinity"; however, in Elliott’s opinion, immediate vicinity “would constitute all company owned facilities which a person may reasonably have the opportunity of coming into contact with during the course of constructing a project.” Elliott concluded that KP&L did not comply with the intent of the NESC in marking the line in question. He said that “marking should be done to the extent that it will give . . . the maximum possible knowledge of the existence of that underground line.” Additionally, Elliott reviewed KP&L’s safety manual for employees and concluded that the safety manual did not comply with the intent of the NESC.
On appeal, KP&L claims that the admission of Elliott’s testimony was reversible error. As Wahwasuck points out, KP&L’s argument focuses on Elliott’s qualifications. KP&L does not suggest that expert testimony on these subjects was not helpful to the jury.
K.S.A. 60-456(b) governs the admission of expert testimony:
“If the witness is testifying as an expert, testimony of the witness in the form of opinions or inferences is limited to such opinions as the judge finds are (1) based on facts or data perceived by or personally known or made known to the witness at the hearing and (2) within the scope of the special knowledge, skill, experience or training possessed by the witness.”
In Marshall v. Mayflower Transit, Inc., 249 Kan. 620, 822 P.2d 591 (1991), this court reviewed the admissibility standards for expert testimony:
“Expert opinion testimony is admissible if it will be of special help to the jury on technical subjects with which the jury is not familiar or if such testimony will assist the jury in arriving at a reasonable factual conclusion from the evidence.” Syl. ¶ 6.
“The admissibility of expert testimony is within the broad discretion of the trial court. A party claiming an abuse of trial court discretion bears the burden of showing abuse of discretion. The test on appellate review of whether the trial court abused its discretion is whether no reasonable person would agree with the trial court. If any reasonable person would agree, appellate courts will not disturb the trial court’s decision.” Syl. ¶ 8.
Relying upon Avey v. St. Francis Hospital & School of Nursing, 201 Kan. 687, 442 P.2d 1013 (1968), and State v. Duncan, 221 Kan. 714, 562 P.2d 84 (1977), KP&L asserts that Elliott’s testimony should have been excluded because Elliott did not have sufficient knowledge of the subject matter to qualify as an expert. In Avey, this court stated that “the test of competency of an expert witness is whether he discloses sufficient knowledge to entitle his opinion to go to the jury.” 201 Kan. 687, Syl. ¶ 2. In Duncan, this court stated that “[w]hen the testimony sought requires proper foundation and knowledge to express an opinion and it is not shown the witness has such knowledge, the opinion testimony is so conjectural as to lack probative value and may be properly excluded by a trial court.” 221 Kan. 714, Syl. ¶ 6.
To further its assertion, KP&L advances a number of reasons why Elliott was not qualified to testify, including that Elliott has no employment background with electric utilities; that he has no background in working with either overhead or underground electrical lines; and that he has had no education or training in the fields of electric current, current theory, or electrical engineering.
Elliott acknowledged that he has never been employed by an electric utility. Although he has little formal training in the area of electrical engineering, having attended only one seminar on the' subject, Elliott testified that he has gained knowledge of electrical currents, current theory, and electrical engineering by supervising electrical engineers for the past eight years. He has had eight years of “real life experiences” involving electricity and rural electrical engineering. For example, Elliott supervised engineers who were remodeling a 30-story building. That project included evaluating the building’s electrical wiring.
Elliott’s prior job was manager of engineering design for Michigan Consolidated Gas Service, a utility company that distributes natural gas. At the time of the trial, Elliott had been chief engineer for the Kansas Corporation Commission (KCC) for five years. He handles the public’s requests for interpretations of the NESC. He regularly interacts with electric utility engineers from all of the Kansas utility companies, including KP&L and rural electric cooperatives. The KCC approves all aspects of KP&L’s electrical work in terms of building electric lines. Elliott also receives reports of any fatalities or serious injuries caused by electric utilities in Kansas. He did not investigate Wahwasuck’s injury because it was never reported to the KCC.
Elliott received a Masters Degree in environmental engineering from Drexel University in Philadelphia. Elliott subscribes to several electricity-related magazines: Electrical World, a commonly read magazine in the electrical industry; Power Magazine, which focuses on electrical power issues; and Independent Energy, which focuses on independent companies’ generation of electricity.
A sampling of KP&L’s other complaints concerning Elliott’s qualifications include that Elliott is not a member of a professional electricity or electric transmission society; that prior to this case, he had not testified as an expert witness in a case involving underground electric lines; and that he has not participated in any studies concerning the safety of underground electric lines. KP&L contends that Elliott’s “only seeming qualification” for offering expert testimony is the fact that he works for the state regulatory agency, the KCC. Furthermore, according to KP&L, Elliott’s
“knowledge is little more than that of a layman, and is inadequate to allow him to express his opinion on matters which are technical enough to require the knowledge, skill and training of electrical engineers who have experience in dealing with electricity in general and underground lines in particular.”
Mere allegations and speculations by KP&L are not proof that Elliott was not qualified to testify as an expert. A reasonable person could concur with the trial court’s finding that Elliott had the requisite expertise to testify, based upon Elliott’s education, training, experience, and current responsibilities. The trial court did not abuse its discretion in allowing Elliott to testify to the extent he testified in this case.
III. FUTURE LOSS
Over KP&L’s objection, the trial court instructed the jury that if it found for Wahwasuck, it could consider “[l]oss of time or income to date by reason of [Wahwasuck’s] disability and that which he is reasonably certain to lose in the future.”
In Morris v. Francisco, 238 Kan. 71, Syl. ¶¶ 2, 3, 708 P.2d 498 (1985), this court held:
“In an action for personal injuries, the trial court should instruct the jury only on those items of damage upon which there is some evidence to base an award. It is not proper to give a general instruction on damages for ‘any of the following shown by the evidence’ when there is no evidence to support an award for a particular item.”
“In a negligence action, recovery may be had only where there is evidence showing with reasonable certainty the damage was sustained as a result of the complained-of negligence. Recovery may not be had where the alleged damages are too conjectural or speculative to form a basis for measurement. To warrant recovery of damages, therefore, there must be some reasonable basis for computation which will enable the trier of fact to arrive at an approximate estimate of the amount of loss.”
The Morris case upheld the submission of a similar instruction, even though the evidence was “scanty.” 238 Kan. at 82.
Here, the trial court concluded there was a basis for the instruction because of evidence that Wahwasuck would benefit from physical therapy and that a rehabilitation program would entail Wahwasuck’s absence from work without pay. KP&L continues to maintain that the evidence was too speculative for the trial court to have submitted Wahwasuck’s claim for past and future income loss to the jury.
Wahwasuck was off work for six months after the accident. He presented evidence that he has a permanent, progressive injury. Dr. William Bailey, who originally treated Wahwasuck for the injury, testified there was a 50 percent chance that Wahwasuck would need another operation. The next operation could be smoothing off the surface of the kneecap, which in today’s dollars would cost about $2,500 with a day or two in the hospital. Wahwasuck could also require surgery to replace his knee joint. In today’s dollars, that operation would cost about $10,000 with 10 days in the hospital. Dr. Bailey also testified that Wahwasuck would benefit from a physical therapy program that could last from two to six months. Dr. Michael McCoy also concluded that Wahwasuck would benefit from a physical therapy program and estimated such a program could last from two to five months.
Donald Picotte, Wahwasuck’s employer, testified that the company would work with Wahwasuck as much as possible, but company policy necessitated that if Wahwasuck took time off work, he would be on medical leave. In other words, if Wahwasuck missed work to attend therapy, he would not be paid for the time absent from work.
At the time of trial, Wahwasuck received $140 a month in compensation from the National Guard. Since the accident, Wahwasuck has managed to pass the physical tests except the requirement of running 2 miles in 17 minutes. He must pass this test in order to remain in the National Guard. Wahwasuck believed he still had a couple of chances to pass the test. Nonetheless, he was doubtful of his ability to pass the test because of the problems with his knee and felt his future with the National Guard was jeopardized. Thus, Wahwasuck could lose his National Guard income. Additionally, if he is unable to remain in the National Guard, he will lose his retirement benefits. He must complete 20 years with the National Guard to receive retirement benefits. As of 1992, he will have completed 12 years with the National Guard.
The trial court did not err in submitting Wahwasuck’s claim for past and future income loss to the jury.
KP&L also comments that the verdict form was not itemized, pursuant to K.S.A. 1991 Supp. 60-249a. The trial court, however, used the verdict form proposed by KP&L. Additionally, KP&L failed to object to the verdict form.
IV DAMAGES
KP&L asserts that this court should order a new trial or, in the alternative, reduce the amount of damages in the form of a remittitur because the trial court abused its discretion. “The granting of a new trial is a matter of trial court discretion and, as with all discretionary matters, will not be disturbed on appeal except by a showing of abuse of that discretion.” State v. Brown, 249 Kan. 698, Syl. ¶ 1, 823 P.2d 190 (1991). KP&L maintains that the trial court abused its discretion because the evidence does not support the verdict — the damages awarded.
“When a verdict is attacked on the ground that it is contrary to the evidence, it is not the function of this court on appeal to weigh the evidence or pass on the credibility of the witnesses. If the evidence, with all reasonable inferences to be drawn therefrom, when considered in the light most favorable to the successful party, will support the verdict, this court should not intervene.” Johnson v. Geer Real Estate Co., 239 Kan. 324, 325, 720 P.2d 660 (1986); see Brown v. United Methodist Homes for the Aged, 249 Kan. 124, Syl. ¶ 2, 815 P.2d 72 (1991).
KP&L claims that any damages awarded for lost income or future medical costs were “entirely speculative.” “In reviewing an award for an objective element of damages such as loss of past and future income, an appellate court must look to the record to see if there is evidence to support the jury’s calculation of pecuniary loss.” Morris, 238 Kan. at 79. In discussing how damages for loss of past and future income should be calculated, this court has observed that
“the extent of the diminution or impairment of earning capacity is a relevant consideration and is arrived at by comparing what the injured party was capable of earning at or before the time of the injury with what the party is capable of earning after the injury. This is recovery for injury to the capacity to earn and is relevant in calculating a party’s loss of earnings.
“In addition, in determining the amount to be awarded for decreased earning capacity, the jury should consider the health of the injured party and the party’s physical ability to maintain herself before the injury, as compared with her condition in these respects afterward. [Citation omitted.]” 238 Kan. at 79.
Recause the judgment was not itemized, an exact comparison of the jury’s calculations for past and future lost income and medical costs with the evidence is not possible. In viewing the evidence in a light most favorable to Wahwasuck, who prevailed below, the following can be noted.
Wahwasuck was 30 years old at the time of the trial. He has suffered a 32 percent to 41 percent deficit in his muscle strength and a 20 percent permanent partial impairment to his lower extremity. One of Wahwasuck’s co-workers testified that since the injury, Wahwasuck favors his good knee and moves slower in general. Recause Wahwasuck’s work involves hard, physical labor, it seems reasonably certain that his injury will affect his future employment possibilities.
Evidence was presented that prior to the accident, Wahwasuck was earning $7 an hour. The jury could take this into account in calculating future lost time or income for rehabilitation, surgery, and other medical needs.
Wahwasuck’s injury is directly related to his arthritis. An arthritic condition usually progresses slowly, but it does not go away. If his knee swells or becomes painful, anti-inflammatory medication is prescribed. The cost of such medication is approximately $1 a day. As discussed in Issue III, there also is a 50 percent chance that Wahwasuck’s condition will require surgery. The surgery could cost from $2,500 to $10,000, and he could miss from one to ten days of work. If a joint replacement is necessary, a much longer period of unemployment would follow.
In addition to past and future lost income and medical costs, the jury also was instructed that if it found for Wahwasuck, it could award damages for past and future “[p]ain, suffering, disabilities, or disfigurement, and any accompanying mental anguish suffered.” Because the verdict form was not itemized, it is not known how the jury allocated damages. The $200,000 award was not limited to economic or objective damages.
KP&L’s analysis fails to take into account pain, suffering, and other subjective elements of damage. Subjective elements of damage are subject to a different standard of review than objective damage elements:
“ ‘Pain and suffering have no known dimensions, mathematical or financial. There is no exact relationship between money and physical or mental injury or suffering, and the various factors involved are not capable of proof in dollars and cents. For this very practical reason the only standard for evaluation is such amount as reasonable persons estimate to be fair compensation for the injuries suffered. . . .’
“Such awards are overturned only if the collective conscience of the appellate court is shocked. [Citations omitted.]” Morris, 238 Kan. at 77-78.
Wahwasuck has suffered pain. The arthritis, which is related to his injury, makes his knee hurt constantly. Some days are worse than others.
Wahwasuck also has been forced to curtail his recreational activities, such as bowling, volleyball, and softball.
In view of the evidence, the collective conscience of this court is not shocked. Far larger damage awards have been upheld. See, i.e., Gaulden v. Burlington Northern R. R. Co., 236 Kan. 213, 213-14, 689 P.2d 852 (1984) ($434,000 judgment upheld; plaintiff suffered severe knee injury); Merando v. A.T.& S.F. Rly. Co., 232 Kan. 404, 406-07, 656 P.2d 154 (1982) ($529,200 judgment upheld; plaintiff suffered functional impairment of both feet, future difficulty likely). The trial court did not abuse its discretion in denying KP&L’s motion for a new trial, which was based on excessive damages, or in not ordering a remittitur.
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On August 22, 1991, respondent Jerry W. Dickson, an attorney licensed to practice law in the State of Kansas, pled guilty in the United States District Court for the Western District of Missouri to the felony crime of conspiracy (18 U.S.C. § 371 [1988]) to commit certain offenses against the United States, as follows:
(1) Knowingly making and causing to be made false entries in the books and records of First Savings Bank and Trust (Bank), with the intent to deceive the officers and directors of the Bank and the examiners of the Federal Home Loan Bank Board, an agency of the United States, in violation of 18 U.S.C. § 1006 (1988);
(2) knowingly executing and attempting to execute a scheme and artifice to defraud and to obtain the monies and funds of the Bank, an institution whose accounts were insured by the FSLIC, by means of false and fraudulent pretenses, representations, and promises, in violation of 18 U.S.C. § 1344 (1988);
(3) knowingly and willfully misapplying and causing to be misapplied the monies, credits, and funds belonging to the Bank, an institution whose accounts were insured by the FSLIC, in violation of 18 U.S.C. § 657 (1988);
(4) knowingly and with the intent to defraud the Bank, the accounts of which were insured by the FSLIC, directly and indirectly receiving a benefit through a loan made by the Bank, in violation of 18 U.S.C. § 1006; and
(5) defrauding the United States of and concerning its governmental functions and rights, i.e., of and concerning its right to have business and its affairs, and particularly the transaction of the official business of the FSLIC, including the Federal Home Loan Bank Board’s regulation, supervision, and examination of the activities of the Bank, conducted honestly and impartially, free from dishonesty and unlawful obstruction.
Respondent pled guilty to the felony crime of knowingly making false entries in the books, reports, and statements of a federally insured bank, in violation of 18 U.S.C. §§ 1006 and 2 (1988).
On December 19, 1991, pursuant to his federal plea bargain and Supreme Court Rule 217 (1991 Kan. Ct. R. Annot. 162), respondent voluntarily surrendered his license to practice law in the State of Kansas.
The court, having examined the files and records of the disciplinary administrator’s office, finds that the surrender of respondent’s license should be accepted and that respondent should be disbarred.
It Is Therefore Ordered that Jerry W. Dickson be and he is hereby disbarred from the practice of law in the State of Kansas and his license and privilege to practice law are hereby revoked.
It is Further Ordered that the Clerk of the Appellate Courts strike the name of Jerry W. Dickson from the roll of attorneys licensed to practice law in the State of Kansas and that respondent shall forthwith comply with Supreme Court. Rule 218 (1991 Kan. Ct. R. Annot. 163).
Dated this 2nd day of January, 1992.
It is Further Ordered that the costs of this proceeding be assessed to the respondent, and that this order be published in the official Kansas Reports. | [
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The opinion of the court was delivered by
Six, J.:
This contract interpretation case is presented to us for review of summary judgment. Our task is to determine whether decedent Robert E. Hollenbeck intended to create a $99,607.46 rollover individual retirement account (IRA) in 1987 with his wife, Peggy L. Hollenbeck, as beneficiary.
Terry Hollenbeck, the son of the deceased by a prior marriage, brought this action as special administrator of the Estate of Robert E. Hollenbeck (Estate) against Household Bank (Bank). The Estate seeks to recover the proceeds ($99,607.46) of an IRA cer tificate of deposit (CD) which was paid to Robert E. Hollenbeck’s widow, Peggy.
Our jurisdiction is based on a transfer from the Court of Appeals under K.S.A. 20-3018(c).
The issue is whether Robert’s designation of Peggy as beneficiary in 1986 on an IRA Simplifier provided by the Bank applies to the 1987 $99,607.46 CD.
The trial court granted summary judgment for the Bank.
We hold that the beneficiary designation applies to the 1987 CD and affirm the trial court.
Facts
Robert E. Hollenbeck, in 1986, opened an IRA at the Bank (a CD in the amount of $15,000) by a rollover transfer from a preexisting IRA. The new account holder was designated as “HOUSEHOLD BANK f.s.b TRUSTEE FOR ROBERT E. HOLLENBECK UNDER I.R.A. #459382” (the account number 459382 was assigned to the IRA CD). The CD provided that the account was held under an IRA agreement.
At the time the 1986 IRA was opened, Robert completed and signed an “IRA Simplifier, Individual Retirement Account Application,’’which listed account number 459382. It also contained Robert’s social security number. On the IRA Simplifier, Robert designated Peggy as the sole primary beneficiary “of this IRA.” The IRA Simplifier contained the following preprinted clause above the signature line:
“Important: Please read before signing.
I have read the eligibility requirements for the type of IRA deposit I am making and I state that I do qualify to make the deposit. I have received a copy of the Application, 5305 Plan Agreement and Disclosure Statement. I understand that the terms and conditions which apply to the Individual Retirement Account are contained in this Application and the 5305 Plan Agreement. I agree to be bound by those terms and conditions.”
The 5305 plan agreement is entitled: “Individual Retirement Trust Account, Form 5305 Under Section 408(a) of the Internal Revenue Code.” The 5305 plan agreement is a two-page form. Article 1 provides in part: “The Trustee may accept additional cash contributions on behalf of the Depositor for a tax year of the Depositor. The additional cash contributions are limited to $2,000 for the tax year unless the contribution is a rollover con tribution.” The 5305 plan agreement contains provisions required by the Internal Revenue Code. Under the section entitled “INSTRUCTIONS,” the 5305 plan agreement states: “An employee’s social security number will serve as the identification number of his or her Individual Retirement Account.” (Emphasis added.)
In March of 1987, Robert purchased a CD in the amount of $99,607.46. The account holder was listed as “Household Bank, Trustee for Robert E. Hollenbeck, IRA Plan #1-515149010” (Robert’s social security number). The 1987 CD was assigned áccount number 471684 (not the number on the 1986 $15,000 CD). The 1987 transaction was a “rollover” of Robert’s retirement account at Procter and Gamble. Robert did not execute a new IRA Simplifier, ■
Robert died intestate in April- 1987. Peggy, as the designated beneficiary under the IRA Simplifier, applied for the proceeds of both the 1986 $15,000 CD and the 1987 $99,607,46 CD.-The Bank paid the proceeds from the two CD’s to, Peggy- in June 1987.
The Special Administrator’s Contentions
The Estate filed a motion for summary judgment-, asserting that the Estate was the proper beneficiary of the 1987 IRA CD because Robert had not designated a beneficiary. The Estate asserted that the IRA Simplifier designating Peggy as beneficiary only'applied to the 1986 IRA CD; therefore, the proceeds of the 1987 IRA CD, $99,607.46, should be paid to the Estate, not to Peggy.
The Bank’s Contentions,
. The Bank reasons that the 1987.IRA ,CD was a “subaccount” of the 1986 IRA agreement; consequently, Robert did designate Peggy as beneficiary for the 1987 IRA CD.
The Bank argues that the 1987 IRA CD was a contribution to the IRA Trust Agreement established by the IRA Simplifier and the 5305 plan agreement at the time the 1986 IRA CD was issued. Therefore, the IRA Simplifier designating Peggy as beneficiary applies to the 1987 IRA CD.'Attached to the Bank’s memorandum in opposition to the Estate’s motion for summary judgment was an affidavit bf an officer and employee' of the Bank.
The affidavit set oüt the Bank’s procedures for opening an IRÁ and for máking' additional contributions to aii existing IRA.
The Bank filed a motion for judgment on the pleadings. The Estate, in its response, objected to the affidavit as inadmissible parol evidence and as inadmissible hearsay evidence. (The affidavit also reported statements of the deceased concerning his intention for beneficiary designation in rolling over an existing retirement account into the 1987 CD.)
The Trial Court’s Ruling
The trial court denied the Estate’s motion for summary judgment and granted the Bank’s motion. The trial court noted that it considered the Bank’s memorandum in opposition to the Estate’s motion for summary judgment. Because the memorandum included material outside the pleadings to which the Estate had replied, the court considered the Bank’s motion for judgment on the pleadings as one for summary judgment. The Estate agreed that the trial court had all of the relevant documents and, consequently, could decide the issues without an evidentiary hearing.
The trial court found that: (1) The 1987 $99,607.46 IRA CD was issued subject to the conditions of the IRA Simplifier executed by Robert in April 1986; (2) Peggy was the sole and primary beneficiary, designated by Robert, of the two CD’s under the IRA Simplifier; and (3) the Bank properly paid Peggy the proceeds from the two CD’s. (Peggy’s status as beneficiary of the 1986 $15,000 CD has never been in issue.)
Summary Judgment
When matters outside the pleadings are presented to and not excluded by the court, a motion for judgment on the pleadings shall be treated as one for summary judgment. K.S.A. 1991 Supp. 60-212(c). Summary judgment is proper only where the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. When summary judgment is challenged on appeal, we must read the record in the light most favorable to the party who defended against the motion. We must reverse when we find that reasonable minds could differ as to the conclusions drawn from the evidence. Hammig v. Ford, 246 Kan. 70, 72-73, 785 P.2d 977 (1990).
Construction of the Written Instruments
The resolution of this appeal requires us to construe and to determine the legal effect of the pertinent written IRA documents. See In re Living Trust of Huxtable, 243 Kan. 531, 533, 757 P.2d 1262 (1988).
The Estate contends the trial court erred in: (1) construing the purchase of the 1987 IRA CD together with the 1986 signing of the IRA Simplifier when Robert purchased the $15,000 IRA CD and (2) concluding that the purchase of the 1987 IRA CD was part of the same transaction involving the same subject matter, i.e., Robert’s IRA. The Estate distinguishes First National Bank of Hutchinson v. Kaiser, 222 Kan. 274, 564 P.2d 493 (1977), and Cline v. Angle, 216 Kan. 328, 532 P.2d 1093 (1975), which were relied on by the trial court. The Estate reasons that the rationale of Cline and Kaiser only applies when two documents constitute one contract and the issue before the court is the meaning of that one contract. According to the Estate, the Cline-Kaiser rationale does not apply when the issue is whether the two documents constitute two separate contracts. The Estate asserts that each IRA CD constitutes a separate contract. Thus, the Estate reasons, the 1986 IRA Simplifier may not operate to designate a beneficiary of the 1987 IRA CD.
The Bank counters that the trial court’s reasoning is appropriate because the IRA trust agreement was explicitly made a part of the two IRA CD’s. Therefore, it is proper to construe the two CD’s as part of the same transaction.
“A cardinal rule in the interpretation of contracts is to ascertain the intention of the parties and to give effect to that intention if the intention is consistent with legal principles.” Garvey Center, Inc. v. Food Specialties, Inc., 214 Kan. 224, 229, 519 P.2d 646 (1974). When a contract is plain and unambiguous, the parties’ intent should be determined from the instrument. See St. Paul Surplus Lines Ins. Co. v. International Playtex, Inc., 245 Kan. 258, 271, 777 P.2d 1259 (1989), cert. denied 493 U.S. 1036 (1990). However, where ambiguity or uncertainty is involved, the parties’ intent may be determined from all the language used in the contract, the circumstances existing when the agreement was made, the object sought to be obtained, and other circumstances, if any, which tend to clarify the intention of the parties. Amor tibanc Investment Co. v. Jehan, 220 Kan. 33, 43, 551 P.2d 918 (1976). Whether an ambiguity exists in a written instrument is a question of law for the court. St. Paul Surplus Lines Ins. Co., 245 Kan. at 271.
Documents which are executed at different times, but in the course of the same transaction concerning the same subject matter, will be construed together to determine the intent of the parties to the contract. West v. Prairie State Bank, 200 Kan. 263, 267, 436 P.2d 402 (1968).
A review of the written documents in the case at bar leads to the conclusion that the parties to the IRA trust agreement, Robert and the Bank, intended the IRA Simplifier, designating Peggy as the beneficiary, to apply to the 1987 IRA CD.
The language of the documents supports our conclusion.
First, the 1986 CD provides that it is held under an IRA agreement. Robert executed the IRA Simplifier on the same day he purchased the 1986 rollover IRA CD. The IRA Simplifier, also entitled “Individual Retirement Account Application,” stated that the simplifier, the 5305 plan agreement, and the disclosure statement contain the terms and conditions of the IRA. Robert agreed to be bound by such terms. The IRA trust agreement included all of the above documents. The 5305 plan agreement contained provisions authorizing additional contributions with different investment options; i.e., savings account, CD, share account, share certificate, or “other savings instruments which we offer.” The 5305 plan agreement also provided that an individual’s social security number will serve as the identification number of his or her IRA. The 1987 IRA CD lists as the account holder “Household Bank, Trustee for Robert E. Hollenbeck IRA Plan #1-515149010” (Robert’s social security number).
We reason that the 1987 IRA CD referred back to the IRA trust agreement established by the IRA Simplifier. It is appropriate to construe all instruments together because they concern the same subject matter, Robert’s IRA.
Second, in 1986, Robert purchased the 10-year $15,000 CD at 10% interest under the IRA trust agreement. In 1987, he transferred the $99,607.46 to the same IRA trust, agreement. He had to purchase a second CD because he could not add to the existing CD. The 1987 CD was a 10-year CD at 8.33% interest. In ad dition, the 1987 IRA CD could not by itself establish a qualified IRA because it did not contain the provisions required by I.R.C. § 408 (1987). If the 1987 IRA CD was not held under the preexisting IRA trust agreement, a valid IRA was not created and Robert would be subject to tax penalties. Therefore, it is reasonable to conclude he intended the 1987 IRA CD to be held under the IRA trust agreement established in part by the, IRA Simplifier executed in 1986. Reasonable rather than unreasonable interpretations are favored by the law. Garvey Center, Inc., 214 Kan. at 227.
The Estate asserts that the affidavit of the Bank’s officer is incompetent as evidence. In support of this assertion, the Estate argues: (1) the contract is unambiguous, and parol evidence is inadmissible to explain the terms of the contract; and (2) the affidavit contains inadmissible hearsay.
We need not review the propriety of the affidavit or address the hearsay issue. We agree with the Estate that the written IRA documents provide the basis for our review.
There is ample evidence from the documents to find that the IRA Simplifier, designating Peggy as beneficiary, applied to the 1987 CD. The Bank properly paid the proceeds of the 1987 CD to Peggy. Summary judgment was proper.
Affirmed.
Abbott, J., not participating.
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Per Curiam-.
This is an original proceeding in discipline. The hearing panel unanimously found Gary Kershner violated Canon 1 of the Code of Professional Responsibility (1991 Kan. Ct. R. Annot. 174) and Model Rules of Professional Conduct 8.4(b), (c), and (g) (1991 Kan. Ct. R. Annot. 308). The panel recommended that Kershner be disbarred because of (1) his two felony convictions for selling unregistered securities, in violation of K.S.A. 17-1255, and his two felony convictions for acting as a broker-dealer or agent when not registered with the Kansas Securities Commissioner, in violation of K.S.A. 17-1254; (2) his failure to pay his attorney registration fees for the years 1985-1990 inclusive; (3) failure to cooperate with the Disciplinary Administrator; and (4) his failure to appear at the January 30, 1991, panel hearing to present any mitigating evidence.
Gary J. Kershner graduated from law school in June 1965. Since 1985 he has not engaged in the practice of law. For the past several years, Kershner has been a business consultant and a director of Country Kettle, Inc., and Aunt Myra’s, Inc., food specialty companies. In his capacity as a business representative of those companies, he handled the sale of stock of those corporations.
The Kansas Securities Commissioner filed a criminal complaint against Kershner consisting of 14 counts alleging violations of the Kansas Securities Act, one count of making a false writing, and one count of perjury. In July 1989, a jury found him guilty of two counts of violating K.S.A. 17-1254 by offering for sale shares of stock of a corporation when he was not registered as a broker-dealer or agent and two counts of violating K.S.A. 17-1255 by offering for sale or selling shares of stock in a corporation when such security was not registered. On September 22, 1989, the district judge suspended imposition of sentence and placed Kershner on supervised probation for a period of five years and ordered him to pay $10,000 in fines. Kershner appealed the convictions to the Court of Appeals. On November 21, 1990, that court affirmed the convictions. State v. Kershner, 15 Kan. App. 2d 17, 801 P.2d 68 (1990).
The Disciplinary Administrator issued a formal complaint on December 21, 1990. A copy of the complaint was sent by certified mail to the address of Kershner’s most recent attorney registration in Topeka, Kansas. Another copy was sent to Kershner at a Lenexa, Kansas, address. The Lenexa address was obtained by the Disciplinary Administrator’s office from Kershner’s counsel in the criminal action. The material sent to the Topeka address was returned to the Disciplinary Administrator’s office as not being deliverable as addressed. The material sent to the Lenexa address reveals that two notices to pick up the materials were issued prior to their being returned unclaimed.
The formal complaint alleged Kershrier’s four convictions for violations of the securities act violated Canon 1 of the Code of Professional Responsibility and Model Rules of Professional Conduct 8.4(b), (c), and (g).
The panel hearing was held January 30, 1991. Kershner did not appear in person or by counsel. The Disciplinary Administrator introduced into evidence the formal complaint, copies of the 16-count criminal complaint, “Affidavit And Application For Arrest Warrant,” the journal entry of conviction from the criminal action, and the opinion of the Court of Appeals affirming the four convictions.
The hearing panel unanimously found Kershner violated Canon 1 of the Code of Professional Responsibility and MRPC 8.4(b), (c), and (g).
The panel recommended that Kershner be disbarred.
On February 19, 1991, the Clerk of the Appellate Courts sent to Kershner by certified mail at the Lenexa, Kansas, address a citation directing the respondent to file with the Clerk either (1) a statement that respondent did not desire to file exceptions to the report, findings, and recommendation, or (2) respondent’s exceptions to the report. The citation was received and signed for by Kershner on February 22, 1991.
Kershner’s exceptions to the hearing panel’s report were filed on April 17, 1991. He denied receiving notice of the January 30, 1991, panel hearing and asked, as an alternative procedure, for a second panel hearing so he could respond to the charges in the formal complaint. That request was denied on April 25, 1991, and Kershner was directed to proceed under Supreme Court Rule 212 (1991 Kan. Ct. R. Annot. 157), which states the procedure normally followed after exceptions to the final hearing report are filed.
Kershner presents four issues for consideration.
I. WHETHER KERSHNER’S REASONS FOR NOT PAYING HIS ATTORNEY REGISTRATION FEES FOR THE YEARS 1985-1990 WERE VALID.
Kershner asserts there is a valid explanation for his failure to pay the attorney registration fees for 1985-1990. Kershner explains he was informed by a clerical employee of the Supreme Court in 1985 that, because he was not practicing law and had not been practicing law for the last year or two, and did not intend to practice law in the future, he was not required to pay the annual registration fee for practicing attorneys. Based on this information, he did not pay the attorney registration fees for 1985-1990. Kershner admits he subsequently learned he was required to request his name be placed on the list of inactive attorneys.
Supreme Court Rule 208 (1991 Kan. Ct. R. Annot. 151) as of July 1, 1987, requires all attorneys admitted to practice law before this court to pay an annual registration fee in such amount as ordered by the court. No registration fee is charged to (1) any attorney newly admitted to the practice of law in Kansas until the first regular registration date following admission, (2) any attorney who has retired from the practice of law and is over age 65, or (3) any attorney who is on inactive status due to physical or mental disability. Kershner does not fall within these exceptions and is required to pay the annual attorney registration fee. Any attorney who fails to pay the registration fee by August 1 of each year may be suspended from the practice of law in this state.
Although one of the bases for the panel’s recommendation that Kershner be disbarred is his failure to pay his attorney registration fees for the years 1985-1990, the Disciplinary Administrator indicated in his brief that he did not perceive the failure to pay the attorney registration fees for the years 1985 through 1990 to be a significant issue because Kershner was not practicing law during those years. We agree with the Disciplinary Administrator’s conclusion and note Supreme Court Rule 208(f) provides a procedure for an attorney who is delinquent in the payment of attorney registration fees to be reinstated.
II. WHETHER KERSHNER WAS DENIED DUE PROCESS OF LAW BY NOT BEING AFFORDED A SECOND HEARING.
Kershner states he never received" notice of the panel hearing which was held on January 30, 1991. He notes that the recommendation that he be disbarred was based, in part, upon his failure to appear and present evidence in mitigation of the charges against him. Kershner contends he was denied his right to a due process hearing because he was not notified of the time, date, and place of the panel hearing. He argues he was entitled to a due process hearing prior to this court’s hearing on the recommendation of the hearing panel. Kershner requests we remand this matter to the panel to afford him a full due process hearing on the complaint.
An elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. Joe Self Chevrolet, Inc. v. Board of Sedgwick County Comm'rs, 247 Kan. 625, Syl. ¶ 3, 802 P.2d 1231 (1990).
The Disciplinary Administrator argues that a copy of the formal complaint and notice of hearing was sent to Kershner by certified mail as required by Supreme Court Rule 215(a) (1991 Kan. Ct. R. Annot. 160) and that under Rule 215(c) service by such mailing is complete upon mailing whether or not the same is actually received. In addition, the Disciplinary Administrator asserts he went a step beyond what is required by Rule 215 by obtaining the Lenexa mailing address and sending by certified mail a copy of the formal complaint and notice of hearing to that Lenexa address. The Disciplinary Administrator states that the respondent, despite two notices, ignored the materials sent to him at the Lenexa address.
Finally, the Disciplinary Administrator asserts that, even if Kershner did not know about his disciplinary hearing, he alone prevented the documents from being sent to his correct address when he failed to apprise the Clerk’s olfice of his mailing address as required by Supreme Court Rule 208(c). In addition, although Kershner failed to respond to either notice at the Lenexa address, he immediately responded to the citation mailed to that address by the Clerk of the Supreme Court.
Under the circumstances, Kershner was afforded notice reasonably calculated to apprise him of the pendency of the hearing before the panel. It was Kershner’s failure to apprise the Clerk’s Office of his mailing address as required by Supreme Court Rule 208(c) that caused his failure to receive the notice. In addition, Supreme Court Rule 212 allowed Kershner to file exceptions to the committee’s report prior to any hearing before this court. Under these facts, Kershner was afforded his right to due process.
III. WHETHER THE EVIDENCE JUSTIFIES THE HEARING PANEL’S FINDING THAT KERSHNER VIOLATED CANON 1 AND MODEL RULES OF PROFESSIONAL CONDUCT 8.4(b), (c), and (g).
Canon 1 states that a lawyer should assist in maintaining the integrity and competence of the legal profession.
Kershner points out that, in finding that he violated Canon 1, the hearing panel did not specifically indicate which part or parts of Canon 1 he violated. He notes that even the Disciplinary Administrator’s formal complaint cites no disciplinary rule under Canon 1 that allegedly was violated or explains how Canon 1 itself was violated.
We have reviewed the record and find it does not sufficiently support a finding of a violation of Canon 1 of the Code of Professional Responsibility.
Kershner next contends that the “purely technical” violations of the Kansas Securities Act are not the types of criminal acts contemplated in Model Rule of Professional Conduct 8.4(b), (c), or (g).
Model Rule of Professional Conduct 8.4 provides in part:
“It is professional misconduct for a lawyer to:
(b) commit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects;
(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;
(g) engage in any other conduct that adversely reflects on the lawyer’s fitness to practice law.” 1991 Kan. Ct. R. Annot. 308.
Kershner argues that, even though a jury found his conduct technically violated the Kansas Securities Act, this does not adversely reflect on his fitness to practice law, because he has not been practicing law and does not intend to practice law in the future.
The Disciplinary Administrator argues the purpose of the Kansas Securities Act is to protect investors by preventing the sale of fraudulent and worthless speculative securities. The Disciplinary Administrator states that, although Kershner contends that his “purely technical” violations of the Kansas Securities Act are not the type of criminal conduct contemplated in MRPC 8.4, the legislature obviously did not consider violations of K.S.A. 17-1254 and 17-1255 to be merely technical violations of the criminal laws of the State of Kansas because the violations are classified as felony offenses.
We hold that the mere fact that Kershner was convicted of four felony violations of the Kansas Securities Act is sufficient to show a violation of MRPC 8.4(b) in that he committed a criminal act that reflects adversely on the lawyer’s “fitness as a lawyer in other respects.” Since there is a violation of MRPC 8.4(b), under the facts present, Kershner’s felony convictions cannot also be “other conduct that adversely reflects on his fitness to practice law” and a violation of MRPC 8.4(g). There does not appear to be a violation of MRPC 8.4(c).
IV. WHETHER THE PANEL’S RECOMMENDATION OF DISBARMENT WAS EXCESSIVE.
Kershner argues that the burden is on the Disciplinary Administrator to prove by clear and convincing evidence that (1) he had the specific intent to violate the Kansas Securities Act and (2) he fraudulently induced individuals to purchase or otherwise accept stock he promoted. Kershner argues there is no evidence he received any personal gain resulting from the acts for which he was convicted and there is no evidence he intended to cause harm, injury, or financial loss to any individuals named in the four counts for which he was convicted.
As authority, Kershner cites the case of In re Holman, Accused, 297 Or. 36, 67, 682 P. 2d 243 (1984), where the Oregon Supreme Court stated in that disciplinary action:
“This proceeding in neither civil nor criminal in nature, but is sui generis .... The Bar has charged that, in taking and withholding the money from the beneficial owners, the accused acted with a specific intent. We hold that the burden of persuasion on that element is on the Bar and does not shift . . . .”
Kershner then summarizes the criminal proceedings and concludes that because the crimes he was convicted of did not require a specific intent to violate the provisions of the Kansas Securities Act convictions for that type of violation do not warrant disbarment. Kershner argues that he believed he was operating within the provisions of the act; he had sought and followed the advice of his attorneys; he had no specific intent to commit the crimes; and neither of his companies, the stockholders, nor any person involved in the four charges he was convicted of has ever complained, sought return of the purchase price of any stock sold or delivered, or filed a complaint, civil or criminal, with the Securities Commissioner alleging injury, misrepresentation, deceit, or fraud. The testimony of the attorney who advised Kershner was excluded by the district judge during the criminal trial, although proffered. The trial judge found there were no victims and refused to order restitution to any party.
Kershner requests we consider all the mitigating factors of the criminal proceedings and his desire to remain in good standing as an attorney. Kershner states that because he had no specific intent to violate the securities act or to harm any person he should not be disbarred.
As authority to disbar Kershner for the crimes for which he was convicted, the Disciplinary Administrator cites Supreme Court Rule 202 (1991 Kan. Ct. R. Annot. 142), which provides:
“A certificate of a conviction of an attorney for any crime or of a civil judgment based on clear and convincing evidence shall be conclusive evidence of the commission of that crime or civil wrong in any disciplinary proceeding instituted against said attorney based upon the conviction or judgment.”
The Disciplinary Administrator notes Rule 202 makes no distinction between a crime requiring specific intent or apy pther crime. The Disciplinary Administrator observes Rule 202 does not require the Disciplinary Administrator to proye the respondent’s specific intent to commit the act when specific intent is not a necessary element of the crimes of which the respondent was convicted.
The Disciplinary Administrator notes the Court of Appeals, when affirming Kershner’s convictions, relied on State v. Hodge, 204 Kan. 98, 460 P.2d 596 (1969). In Hodge, the appellant argued his convictions for violations of the securities act should be reversed because, under the criminal statute there was no requirement for the prosecution to prove he specifically intended to violate the Act. This court rejected Hodge’s argument and affirmed his convictions. In Hodge, 204 Kan. 98, Syl. ¶ 10, we stated that “[u]nder K.S.A. 17-1267 any person who willfully violates the provisions of the Kansas securities act is guilty of a felony, no specific intent being required to commit the offense. The term ‘willfully’ is construed to mean the person acted intentionally in the sense that he was aware of what he was doing.”
The Disciplinary Administrator also notes that in State v. Russo, 230 Kan. 5, 630 P.2d 711 (1981), the respondent maintained he was innocent of the underlying criminal charge which led to the disciplinary action and urged the court to look behind the conviction. The Russo court rejected respondent’s request, stating: “However, once that conviction became final, it is conclusive upon this court and this court will not look behind the conviction or attempt to weigh the evidence leading to that conviction-” 230 Kan. at 8.
Contrary to Russo’s claim he was innocent, Kershner is not arguing that he should not have been convicted of the crimes because he had no specific intent to commit the offenses. Rather, he is stating that his lack of specific intent and the surrounding circumstances such as good faith reliance on his attorney and the fact there were no victims, etc., mitigate the gravity of the convictions for purposes of imposing discipline.
The Disciplinary Administrate does not address Kershner s argument that the lack of specific intent reduces the gravity of the convictions for purposes of deciding the type of attorney discipline that should be imposed.
Kershner contends that disbarment is excessive punishment under the circumstances of his convictions. He points out his scholastic and athletic accomplishments as a college student, his civic activities, his interest in and assistance to Kansas youth, and his lack of intent to defraud or injure anyone or to knowingly violate Kansas securities law.
In assessing discipline, certain factors are to be considered: (1) whether restitution has been made; (2) previous violations or absence thereof; (3) previous good character and reputation in the community; (4) present or past attitude of the attorney as shown by his cooperation during the hearing and acknowledgment of the transgression; (5) support from clients, members of the bar, and friends; (6) any statement by a complainant expressing satisfaction with any restitution made and requesting no discipline; and (7) personal misfortunes of the attorney which may have contributed to any violation. State v. Hohman, 235 Kan. 883, 890, 686 P.2d 122 (1984).
Kershner claims that, upon consideration of the above factors, he should no.t be disbarred but should be placed on probation and permitted to submit a request to the Court that his name be placed upon the role of inactive attorneys for the reason that he has not practiced law since 1985 and has no intention of practicing law in the future.
The Disciplinary Administrator asserts that Kershner continually downplays the seriousness of his cpnduct; that he justifies his actions by claiming to have acted in good faith and in reliance on another attorney’s advice; that he claims he was the victim of a personal vendetta on the part of the Kansas Securities Commissioner; and that Kershner has not recognized or accepted the seriousness of his conduct.
We note the Comment in MRPC 8.4 states in part:
“Many kinds of illegal conduct reflect adversely on fitness to practice law, such as offenses involving fraud and the offense of willful failure to file an income tax return. However, some kinds of offense carry no such implication. Traditionally, the distinction was drawn in terms of offenses involving ‘moral turpitude.’ That concept can be construed to include offenses concerning some matters of personal morality, such as adultery and comparable offenses, that have no specific connection to fitness for the practice of law. Although a lawyer is personally answerable to the entire criminal law, a lawyer should be professionally answerable only for offenses that indicate lack of those characteristics relevant to law practice. Offenses involving violence, dishonesty, or breach of trust, or serious interference with the administration of justice are in that category. A pattern of repeated offenses, even ones of minor significance when considered separately, can indicate indifference to legal obligation.” 1991 Kan. Ct. R. Annot. 308.
The respondent did violate MRPC 8.4(b) in committing a criminal act that reflects adversely on his fitness as a lawyer. We acknowledge under the facts Kershner s convictions for violating the securities act were not acts of violence, dishonesty, or a breach of trust or a serious interference with the administration of justice. In addition, the district judge determined there were no victims to compensate because of Kershner’s illegal act. The majority of this court finds disbarment is excessive under these circumstances and imposes the less severe punishment of public censure.
It Is Therefore Ordered that Gary Kershner be, and he is hereby, publicly censured for his violation of MRPC 8.4(b).
It Is Further Ordered that this order shall be published in the Kansas Reports and that the costs herein be assessed to the respondent. | [
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Per Curiam:
This is an original proceeding in attorney discipline filed by the disciplinary administrator against Diane Hensley-Martin, an attorney admitted to the practice of law in Kansas.
The complaint filed against respondent grows out of a final adjudication in Colorado that respondent was guilty of professional misconduct. The complaint is filed under Supreme Court Rule 202 (1991 Kan. Ct. R. Annot. 142) and alleges respondent violated Supreme Court Rule 207 (1991 Kan. Ct. R. Annot. 149); DR 1-102(A)(1), (A)(5), and (A)(6) (1991 Kan. Ct. R. Annot. 174); DR 2-110(A)(2) (1991 Kan. Ct. R. Annot. 189); DR 5-101(A) (1991 Kan. Ct. R. Annot. 194); DR 5-105(B) (1991 Kan. Ct. R. Annot. 195); DR 5-107(B) (1991 Kan. Ct. R. Annot. 196); DR 6-101(A)(2) and (A)(3) (1991 Kan. Ct. R. Annot. 199); DR 7-104(A)(l) (1991 Kan. Ct. R. Annot. 205); and DR 9-102(B)(4) (1991 Kan. Ct. R. Annot. 216).
The respondent appeared in person at the disciplinary hearing and admitted all of the allegations in the complaint.
The disciplinary panel found the respondent guilty of violating all of the disciplinary rules alleged in the complaint.
Respondent filed no exceptions and did not appear at oral argument.
The Court, having considered the record and the report and recommendation of the disciplinary hearing panel, accepts and concurs in the findings, conclusions, and recommendations of the disciplinary hearing panel with the exception that suspension shall commence on the date of this opinion rather than on August 20, 1990.
It Is Therefore Ordered that Diane Hensley-Martin be and she is hereby disciplined by suspension from the practice of law in the State of Kansas for a period of two years commencing on the date of this opinion, all in accordance with Supreme Court Rule 203(a)(2) (1991 Kan. Ct. R. Annot. 143), for her violations of the disciplinary rules of the Supreme Court.
It Is Further Ordered that respondent shall comply with the provisions of Supreme Court Rule 218 (1991 Kan. Ct. R. Annot. 163), that she shall pay the costs of this proceeding, and that this order shall be published in the official Kansas Reports. | [
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The opinion of the court was delivered by
Six, J.:
The primary issue in this appeal relates to the sufficiency of the count in the information charging Dennis L. Sanford with aggravated kidnapping. If the information was not sufficient, the trial court had no jurisdiction over Sanford on the aggravated kidnapping charge.
Sanford filed a motion for arrest of judgment under K.S.A. 22-3502 after trial, challenging the information and jurisdiction. The motion was denied.
Additional issues relate to the trial court’s refusal to: (1) suppress certain exhibits taken from Sanford’s home and from an attorney representing Sanford in other matters; and (2) permit defense counsel to comment to the jury concerning the victim’s bruises as she stepped down from the witness stand.
Sanford was charged, in separate counts, with aggravated kidnapping, K.S.A. 21-3421; attempted aggravated criminal sodomy, K.S.A. 1991 Supp. 21-3301, K.S.A. 21-3506; and sexual battery, K.S.A. 21-3517. He was convicted of the lesser offense of kidnapping, K.S.A. 21-3420, and on the sodomy and sexual battery counts.
We apply the rationale of State v. Hall, 246 Kan. 728, 793 P.2d 737 (1990), and reverse on the kidnapping charge; the amended information charging aggravated kidnapping was defective. We find no error in the trial court’s rulings in admitting the exhibits and in prohibiting Sanford from commenting upon the victim’s bruises.
The . convictions of attempted aggravated criminal sodomy and of sexual battery are affirmed.
Facts
Sanford’s sister testified that she and her brother owned and lived together in a house in Topeka, which they were in the process of selling. They had discussed contacting real estate agents. Sanford made the contacts because his sister worked and had no time to do so.
The victim, S.S., a real estate agent, testified that she first met Sanford on a Sunday, having received a call earlier that day regarding the potential listing of his home. S.S. and her husband went to the residence and talked with Sanford for approximately 45 minutes. Learning that Sanford’s only income was a social security check, S.S. determined that she needed to talk with Sanford’s sister regarding the sister’s financial circumstances. Later that evening, S.S. spoke to Sanford on the telephone and arranged to return to meet his sister the following day.
When S.S. arrived at the residence on Monday, the sister was not there. After waiting approximately 30 minutes, S.S. left. S.S. received a message to call Sanford later, and they set up an appointment for 10:00 a.m. the following day. S.S. stated that she never attempted to contact Sanford’s sister.
S.S., who had written a sales contract on only one house before, was eager to complete Sanford’s sale and skipped the agency’s obligatory sales meeting and tour of homes in order to keep the appointment with Sanford. When she arrived, she was told that Sanford’s sister had gone for cigarettes. Feeling comfortable, S.S. helped herself to coffee as she and Sanford discussed financial matters. S.S. stated that Sanford did not prevent her from leaving. Sanford wanted to look at houses for sale in the area to which he and his sister were hoping to move, so S.S. retrieved her briefcase and listing book from her car. They looked through the book for 10 to 15 minutes, S.S. sitting on the couch and Sanford sitting in a chair across the room. Sanford eventually sat on the arm of the couch in order to see the book. When he put. his arm on the back of the couch, his fingertips brushed S.S.’s shoulder and she told him to “back off,” that she was trying to help him find a house.
S.S. testified that Sanford then pushed her over onto the couch, placed his hand over her mouth, and told her they were going to have fun. At trial she stated she tried to bite his fingers but could not because his hand was clasped too tightly. She had previously reported that she could not bite him because he kept moving his fingers. S.S. stated she tried to talk Sanford into letting her go, but that he told her to shut up and insisted that they were going to have fun. Upon his demand, S.S. removed her blouse, and then her bra. She stated that Sanford was grasping and pulling on her breasts. S.S. ran to the front door before being pulled back and hurled to the couch.
According to S.S., Sanford then produced three pieces of yellow paper which looked like facsimiles of legal forms and told her to sign them. Refusing at first, S.S. said she signed and dated them after Sanford threatened to kill her. The three papers, as well as copies, were entered into evidence over a defense objection. The yellow paper documents were titled “Contract,” “Affidavit,” and “Advice of Rights.”
Although S.S. could not remember the occurrence sequence, she stated she gave Sanford her husband’s telephone number, telling Sanford she had another appointment. Sanford dialed the number four times;, however, it was busy each time.
According to S.S., Sanford unzipped his pants and pulled out his penis, telling her to put it in her mouth. She replied that the act would, make her vomit. She also refused his request that she remove her skirt, claiming she was menstruating. She stated that Sanford then placed her hands on his penis and forced her to masturbate him, assisting her with his hands. She licked his penis three times when threatened and stated that Sanford then ejaculated onto her hand and skirt. Sanford cleaned himself with a washcloth and offered it to her, leading her to the kitchen sink where she dabbed at her skirt with it. Sanford kissed S.S. in the kitchen, and S.S. promised Sanford she would go straight home.
5.5. returned to the living room and put on her blouse. She was permitted to look briefly at the papers she had signed earlier. One appeared to be a statement that she and Sanford were having an affair and that she would not tell the police or her husband. Another stated that she would be responsible for all his household expenses and bills. S.S. promised Sanford she would return the next day to continue the affair. She gathered her belongings and left the residence. S.S. drove to her husband’s office, and the police were called.
5.5. was interviewed and taken to Stormont-Vail hospital where a partial rape kit was completed. Photographs were taken of a bruise on her arm and scratches on her hand. The next day she returned to the police station and photographs of additional bruises on her ankle and upper arm were taken. She claimed she received the bruises at Sanford’s but had not reported them the day before.
A forensics examiner with the Kansas Bureau of Investigation (KBI) testified concerning tests conducted for the presence of seminal fluid. Seminal fluid was found on S.S.’s blouse and skirt, but none was found on defendant’s couch cushions or washcloth, or on S.S.’s bra or oral swabs from her rape kit. The KBI was able to conclude that Sanford was a possible donor.
The Amended Information — Aggravated Kidnapping
We will set out the developmental steps in the formation of the charge of aggravated kidnapping,
(1) The original complaint filed July 26, 1990, charged Sanford with simple kidnapping, committed with the intent to inflict bodily injury, or to terrorize and to facilitate flight or the commission of a crime.
(2) The State, at the preliminary hearing on August 16, 1990, before testimony was taken, moved to amend thé complaint to charge aggravated kidnapping. The State indicated that following the hearing it would amend by “written amended complaint.”
(3) The trial court, at the preliminary hearing, sought clarification. The State asserted that the amendment would be that, “[Sanford] confined the defendant [sic] by force, threat or deception and it was done with the intent to facilitate commission of a crime.”
At this point, defense counsel opposed the amendment and noted that the State’s recitation of the charge was faulty and that a charge of aggravated kidnapping had not been made. The infliction of bodily harm was not alleged as required by K.S.A. 21-3421 for aggravated kidnapping.
(4) The amendment from kidnapping to aggravated kidnapping was permitted by the trial court.
(5) The State filed an amended written information on August 17, 1990. The written information failed to allege an essential element of the crime of kidnapping; the intent for which the taking or confinement was committed. The amended charge stated:
“Count 3
“AGGRAVATED KIDNAPPING K.S.A. 21-3421, pen. section 21-4501(a)
“On or about the 24th day of July, 1990 in the County of Shawnee and State of Kansas, DENNIS L. SANFORD, did then and there unlawfully, feloniously and willfully confine another, to-wit: [S.S.], by force or threat, with the intent to hold the said [S.S.], and did inflict bodily harm upon the person of the said [S.S.] contrary to the form of the statutes in such case made and provided and against the peace and dignity of the State of Kansas.
“OR IN THE ALTERNATIVE
“Count 3
“AGGRAVATED KIDNAPPING K.S.A. 21-3421, pen. section 21-4501(a)
“On or about the 24th day of July, 1990 in the County of Shawnee and State of Kansas, DENNIS L. SANFORD, did then and there unlawfully, feloniously and willfully confine another, to-wit: [S.S.], by deception, with the intent to hold the said [S.S.], and did inflict bodily harm upon the person of the said [S.S.] contrary to the form of the statutes in such case made and provided and against the peace and dignity of the State of Kansas.”
(6) K.S.A. 21-3420 states:
“Kidnapping is ;the taking or confining of any person, accomplished by force, threat or deception, with the intent to hold such person:
“(a) For ransom, or as a shield or hostage; or
“(b) To facilitate flight or the commission of any crime; or
“(c) To inflict bodily injury or to terrorize the victim or another; or
“(d) To interfere with the performance of any governmental or political function.
“Kidnapping is a class B felony.”
The amended charge omitted any expression of the elements (a), (b), (c), or (d) of K.S.A. 21-3420.
(7) At the close of the case in chief, the State elected to proceed upon the alternative charge of aggravated kidnapping by deception.
(8) The jury was instructed on aggravated kidnapping and simple kidnapping based upon the theory that the confinement was by fraud or deception and was done with the intent to inflict bodily injury on the victim.
(9) The aggravated kidnapping instruction stated:
“The defendant is charged with the crime of Aggravated Kidnapping. The defendant pleads not guilty.
“To establish this charge, each of the following claims must be proved:
“1. That the defendant confined [S.S.] by fraud or deception;
“2. That it was done with intent to hold such person to inflict bodily injury to the victim;
“3. That bodily harm was inflicted upon [S.S.];
“4. That this act occurred on or about the 24th day of July, 1990, in Shawnee County, Kansas.”
(10) The State argued at the post-trial hearing on Sanford’s motion for arrest of judgment (the motion alleged that an essential element of the offense was omitted) that Sanford had notice that the specific intent being alleged was the “intent to hold [S.S.] to facilitate the commission of the crime.”
(11) The jury instructions did not mention facilitation of a crime. The jury was instructed that the intent to hold the victim was for the purpose of inflicting bodily injury.
The Ruling of the Trial Court
The trial court denied Sanford’s motion for arrest of judgment, reasoning that the oral amendment “was effective to cure any defect that might have been existing herein.” The trial court stated:
“Throughout the entire proceedings herein, although the language was somewhat inarticulate, the manifest objective of the State was to charge the Defendant of kidnapping, that is to hold the victim [S.S.] with intent to inflict bodily harm or to facilitate the commission of a crime. The State was required to, and did elect the intent to inflict bodily injury alternative at the time of instruction to the jury. It was patently clear and obvious to the Defendant and Defense Counsel throughout the entire proceedings, that the intent charged was as stated above. There can be no confusing, misunderstanding, or prejudice to the Defendant as a result of the fact that the State did not specify the intent with precision in the information.”
The State’s Position
The State admits that the information did not speedy which of the four enumerated options of K.S.A. 21-3420 the State relied on. The State reasons that the original complaint charging kidnapping was sufficient. The original complaint charged kidnapping “with the intent to hold . . . inflict bodily injury or to terrorize [S.S.] to facilitate flight or the commission of a crime.” See K.S.A. 21-3420(b) and (c). The State reasons that, although the written information filed the day following the State’s oral amendment did not contain the language of K.S.A. 21-3420(a), (b), (c), or (d), it is clear from the record that the trial court, as well as Sanford, relied on the oral amendments of the State. According to the State, jurisdiction was solidified by the oral amendment “along with the complaint and information.”
Sanford’s Position
Sanford relies on State v. Hall, 246 Kan. 728, 793 P.2d 737 (1990). In Hall, we held that the proper procedure to follow in asserting a contention that either an information does not charge a crime, or that the trial court was without jurisdiction of the crime charged, is to file a motion for arrest of judgment under K.S.A. 22-3502. Sanford did so. Our signal in Hall set out a preHall standard and a post-Hall standard. 246 Kan. at 764-65. Because Sanford filed the motion for arrest of judgment, the trial court was to test the sufficiency of the information by the preHall standard.
The original count 3, kidnapping, filed as a written information stated:
“Count 3
“KIDNAPPING Sec. 21-3420, K.S.A.; Penalty Sec. 21-4501(b)
“On or about the 24th day of July, 1990 in the County of Shawnee and State of Kansas, DENNIS L. SANFORD, did then and there unlawfully, feloniously and willfully take or confine another, to-wit: [S.S.], by force, threat or deception, with the intent to hold the said [sic] inflict bodily injury or terrorize [S.S.] to facilitate flight or the commission of a crime, contrary to the form of the statutes in such case made and provided and against the peace and dignity of the State of Kansas.” (Emphasis added).
The italicized portion of count 3 was omitted from the written information filed charging Sanford with aggravated kidnapping.
K.S.A. 21-3420, the kidnapping statute, provides four types of intent, an allegation of one being essential to the commission of the crime. The amended information fails to allege in the count of aggravated kidnapping any intent for which the holding was committed and is fatally defective for failing to allege every essential element of kidnapping. The oral amendment to the original charge of kidnapping was followed by the filing of a written information. The written amended information controls over the earlier oral amendment. The oral amendment of aggravated kidnapping at the preliminary hearing, elevating the charge from simple kidnapping, is insufficient as the oral amendment did not allege that bodily harm was inflicted, an element of K.S.A. 21-3421, aggravated kidnapping. Sanford asserts that the motion for arrest of judgment should have been granted based on the trial court’s lack of jurisdiction. We agree.
Jurisdiction
The trial court had no jurisdiction over the charge of aggravated kidnapping. The amended information was insufficient. It did not contain the elements of the crime of aggravated kidnapping. We follow the teaching of Hall. In Hall we stated:
“We urge the defense bar to utilize this K.S.A. 22-3502 arrest of judgment defense tool. If the court did not have jurisdiction, or if the information did not charge a crime for which the defendant was convicted, the defendant is entitled to a determination of that condition at the trial court level.
“A motion for arrest of judgment is the proper procedure for a defendant who wishes to challenge the sufficiency of the information after trial because of either a claim that it did not charge a crime or that the court was without jurisdiction of the crime charged. When such a motion is timely filed, the trial court, in reviewing the motion, shall test its merit by utilizing the rationale of our pre-Hall cases.” 246 Kan. at 764.
Sanford timely filed his motion for arrest of judgment.
We now turn to the pre-Hall cases and apply the rationale of those cases to the case at bar.
In Kansas, all crimes are statutory and the elements necessary to constitute a crime must be gathered wholly from the statute. An information which omits one or more of the essential elements of the crimes it attempts to charge is jurisdictionally and fatally defective, and a conviction based on such an information must be reversed. See State v. Jackson, 239 Kan. 463, Syl. ¶ 4, 5, 721 P.2d 232 (1986).
We have held that the citation to the statute cannot substitute to supply a missing element of the charge. Incorporation by reference cannot be implied or inferred. It must be explicit. Jackson, 239 Kan. at 466. A proper instruction does not remedy the defect in the complaint. State v. Howell & Taylor, 226 Kan. 511, 513, 601 P.2d 1141 (1979).
In Hall, the failure of the complaint to allege that Hall took control of the cattle with the intent to permanently deprive-the owner of its possession rendered the complaint fatally defective. Hall’s conviction of theft, under K.S.A. 21-3701, was reversed. 246 Kan. at 747. (A detailed analysis of our pr e-Hall cases is set out at 246 Kan. at 758-59.)
Aggravated kidnapping requires an allegation that bodily harm was inflicted. State v. Smith, 245 Kan. 381, 396, 781 P.2d 666 (1989).
We have permitted oral amendments to an information (or complaint). Oral amendments must be detailed and specific and are to be memorialized. State v. Browning, 245 Kan. 26, 774 P.2d 935 (1989) (oral amendment from first-degree murder to second-degree murder, later journalized, ineffective because malice not alleged); State v. Switzer, 244 Kan. 449, 456, 769 P.2d 645 (1989) (detailed and specific oral amendment, though not memorialized by time of appeal, held effective with appellate order to amend the journal entry nunc pro tunc showing the corrected complaint); State v. Nunn, 244 Kan. 207, Syl. ¶ 18, 768 P.2d 268 (1989) (oral motion to amend sustained on the record before the verdict is rendered; amendment effective immediately, absent prejudice to the defendant, and not invalidated although prosecution does not memorialize the amendment by journal entry until after-trial).
The oral amendment to Sanford’s original charge of simple kidnapping was followed by the new amended written information charging aggravated kidnapping. The written information controls over the earlier oral amendment; consequently, our holding in Switzer is not applicable to the instant fact situation.
In the case at bar, the oral amendment charging aggravated kidnapping was defective, and the subsequent written amendment to the count charging aggravated kidnapping was also defective. The trial court erred in failing to grant Sanford’s motion for arrest of judgment. The conviction of kidnapping is set aside as void. The trial court had no jurisdiction over the charge of aggravated kidnapping.
Admission of State’s Exhibit
The warrant issued for the search of Sanford’s residence authorized a search and seizure of the following items:
“1. Documents suspect made victim sign. (She signed three documents.)
“2. Wool white rug with blue or black pattern — on floor in front of couch.
“3. Brown tweed sofa or portion of sofa — reference seminal fluid.
“4. Royal blue shorts worn by suspect.
“5. White or grey t-shirt worn by suspect.
“6. Documents as to resident(s) or renter(s).
“7. Light blue wash cloth.
“8. The person of Dennis Sanford for blood, hair and saliva.”
The search was successful. Initially, the officers found everything listed except item 1, the documents S.S. had signed. During the search a detective had occasion to thumb through a black notebook which contained yellow and white note paper. At the back of the notebook the detective observed white papers shoved down in the back pocket. The detective pulled the white papers out to examine them. The papers were three photocopies of the documents (item 1 of the search warrant) S.S. had reported signing. The detective made the statement to Sanford, “[A]nd you didn’t know anything about these, did you?” Sanford responded by saying, “Thanks a lot for telling him, Nan.” (Nan is Sanford’s sister.)
At this juncture, the detective directed uniformed officers to arrest Sanford. While officers were placing handcuffs on Sanford, he indicated it was “no problem, his attorney had the originals,” as he had taken them to the attorney.
The State, by court order, secured the original handwritten documents (three yellow sheets) from defendant’s attorney and introduced the yellow sheets in evidence at trial. The search warrant issued by the trial court described, with particularity, the property to be searched and seized. Sanford has raised no issue as to the validity of the search warrant. Sanford contends that since one detective discovered nothing when he looked at the notebook, it was then off-limits to a second detective. Sanford’s contention is not persuasive.
The search of Sanford’s residence was directed in good faith toward the objects specified in the warrant. State v. Bolen, 205 Kan. 377, 469 P.2d 422 (1970). Sanford asserts that because the copies were white and not yellow in color, their seizure exceeded the scope of the lawful search. The State counters by noting that the search warrant issued does not describe the color of documents. The action of the second detective in looking through a notebook containing yellow and white paper in an attempt to discover the documents was reasonable. The photocopies of the documents seized by officers pursuant to a lawful search were admissible.
Sanford’s statements made at the time of the search were suppressed because the trial court found their relevancy questionable and also a source for potential jury speculation.
At trial, defense counsel objected to the admission of the three yellow documents, arguing that they were a product of Sanford’s statements which the trial court had previously suppressed. The trial court reaffirmed its previous ruling. The documents were not part of an impermissible search and seizure. The previous ruling on the suppression of Sanford’s statements could not be extended to the documents.
Defense counsel renewed the objection to the yellow documents, as well as the white copies seized during the search of Sanford’s house when they were submitted to the jury at trial. No testimony was presented as to how the yellow documents were obtained by the State.
The three original yellow documents contained the exact information contained in the white copies. The white copies were properly admitted. There was no error in admitting the yellow originals.
The Physical Appearance of the Victim
Sanford asserts that the trial court abused its discretion in denying him the opportunity to exhibit bruises on S.S.’s leg to the jury.
The focus of this issue is the exchange which took place as S.S. was leaving the witness chair, having been called as a rebuttal witness by the State. It was as follows:
“[Defense counsel]: Your Honor, I have no questions. I would just like for the jury — you can step down, ma’am.
“THE COURT: Well, if you have no questions—
[Defense.counsel]: I have no questions. You can step down.
“THE COURT: You can’t tell the jury—
“[Defense counsel]: I would just like to point out for the jury the bruise that is on [S.S.’s] leg.
“[Assistant district attorney for State]: Judge, I think that’s improper. I move to strike.
“[Defense counsel]: Let, let’s do it this way. All right, Your Honor.
“THE COURT: I’ve already excused the witness. You may be excused.
“[Defense counsel]: And they can observe the bruises.
“[Assistant district attorney for State]: Judge, I move to strike Mr. Cerrillo’s statement.
“THE COURT: Jury disregard.
“[Defense counsel]: The jury has seen what it saw.
“THE COURT: The jury will disregard the comments by counsel. They’re inappropriate.
“[Assistant district attorney for State]: State has no further rebuttal, Your Honor.
No foundation was laid by Sanford’s counsel for the alleged bruise markings located on S.S.’s person. There was no testimony as to the markings or their origin. Sanford’s counsel is the only one who stated the markings were bruises. Defense counsel stated he had no questions for S.S. and did not attempt to call anyone who would have such knowledge regarding the victim’s physical condition.
The foundation to admit physical evidence is determined by the trial judge, who must be satisfied as to relevance. State v. Boone, 220 Kan. 771, 556 P.2d 880 (1976). The applicable standard of review for abuse of discretion is that no reasonable person would take the view adopted by the trial court. State v. Wagner, 248 Kan. 240, 242, 807 P.2d 139 (1991).
We find no abuse of discretion.
Sanford was sentenced to a term of 15 years to life for kidnapping, 5 years to 20 years for attempted aggravated criminal sodomy (these two sentences are to run consecutive with each other), and 1 year for sexual battery (to run concurrent with either of the other two sentences).
We affirm the convictions of attempted aggravated criminal sodomy and sexual battery. The kidnapping conviction is set aside as void. We remand to the trial court for further proceedings. | [
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The opinion of the court was delivered by
Herd, J.:
Charlett M. Harding, individually and as an executrix of her husband’s estate, brought this tort action against K.C. Wall Products, Inc. (K.C. Wall). K.C. Wall motioned for summary judgment, arguing Harding’s claim was barred by the statute of limitations, K.S.A. 1991 Supp. 60-513. The district court denied K.C. Wall’s motion and K.C. Wall brought this interlocutory appeal.
The parties stipulated to the following facts. From approximately 1963 until his death Jerry Harding was a painting contractor in Wichita, Kansas. Harding Painting Contractors purchased asbestos-containing drywall products from K.C. Wall and others from about 1972 until no later than January 1, 1977.
K.C. Wall Products, Inc., is a Missouri corporation with its principal place of business located in Kansas. It is the successor by merger to a company formerly known as Ruco, Inc. K.C. Wall’s predecessor did not begin to manufacture or sell any asbestos-containing products until 1971, and did not manufacture or sell any asbestos-containing products after April 1976 at the latest. Therefore, Jerry Harding’s last exposure to any asbestos- containing products manufactured, sold, or distributed by K.C. Wall or its predecessor occurred prior to January 1, 1977.
In March 1988 Jerry Harding was diagnosed by his treating physicians with malignant pleural mesothelioma. Harding died on October 26, 1988, as a result of this illness.
Charlett Harding, Jerry’s wife, filed suit individually and as executrix of Jerry’s estate against K.C. Wall on September 5, 1990. The petition alleged negligence and strict liability due to design defect and failure to warn.
On February 1, 1991, K.C. Wall moved for summary judgment, arguing the cause of action had been filed over 10 years after any possible wrongful act by K.C. Wall and, therefore, was barred by the statute of limitations, K.S.A. 1991 Supp. 60-513. K.C. Wall further contended the 1990 amendment to K.S.A. 60-3303 designated as H.B. 2689, which Charlett claimed revived her claim, is unconstitutional. The district court denied K.C. Wall’s summary judgment motion, finding H.B. 2689 was constitutional, and revived Charlett’s cause of action. The district court also certified the issue for an interlocutory appeal pursuant to K.S.A. 1991 Supp. 60-2102(b).
K.C. Wall’s request for an interlocutory appeal was granted by the Court of Appeals on May 28, 1991. We transferred the action to this court on June 20, 1991.
The issue for our consideration is whether Charlett’s cause of action is barred by the statutes of limitations. For a better understanding of the issues, let us examine the pertinent statutes of limitations, the most recent amendments thereto, and our opinions construing those statutes.
The general statute of limitations for tort actions is K.S.A. 1991 Supp. 60-513. K.S.A. 1991 Supp. 60-513(a) provides for a two-year limitation and K.S.A. 1991 Supp. 60-513(b) and (c) explain how to determine when a cause of action accrues. Prior to the 1987 amendment to K.S.A. 60-513, subsection (b) stated:
“(b) Except as provided in subsection (c) of this section, the cause of action in this action [section] shall not be deemed to have accrued until the act giving rise to the cause of action first causes substantial injury, or, if the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall the period be extended more than ten (10) years beyond the time of the act giving rise to the cause of action.”
We construed K.S.A. 60-513 in Ruthrauff, Administratrix v. Kensinger, 214 Kan. 185, 519 P.2d 661 (1974). Ruthrauff arose from a gas explosion and fire which destroyed a house and caused the death of one of the homeowners 12 days later. Within two years of the explosion but over 10 years after the house was built, the administratrix of the decedent’s estate filed a suit against the building and plumbing contractors. The trial court granted the defendants’ motion for summary judgment based upon its interpretation of K.S.A. 60-513(b) that “ ‘[n]o cause of action can arise if more than ten years have elapsed since the alleged wrongful act.’ ” 214 Kan. at 187. We reversed, finding:
“Under K.S.A. 60-510 this primary 2 year period [in 60-513(a)] is not to commence until each cause of action shall accrue, i.e., when substantial injury results. The 10 year provision is secondary and speaks to this primary period when it states ‘but in no event shall the period be extended more than ten (10) years beyond the time of the act giving rise to the cause of action.’ . . . [The 10-year provision] is merely a limitation on the extension of the 2 year period when substantial injury is not immediately ascertainable. . . . [The 10-year provision] does not affect or limit the primary 2 year period for bringing an action where the fact of substantial injury is immediately apparent as in the case of an explosion and resulting fire.” 214 Kan. at 191.
In addition, Ruthrauff has been interpreted to mean “[t]he ten-year cap contained in K.S.A. 60-513(b) is applicable only where the fact of injury is not reasonably ascertainable until some time after substantial injury occurs.” Kinell v. N.W. Dible Co., 240 Kan. 439, 443, 731 P.2d 245 (1987).
The next case of major importance to understanding K.S.A. 60-513 prior to the 1987 amendment is Tomlinson v. Celotex Corp., 244 Kan. 474, 770 P.2d 825 (1989). Tomlinson came before this court as a certified question from the United States District Court. The certified question presented the following question: “Does the ten-year limitation of K.S.A. 60-513(b) apply to claims involving latent diseases and, if so, is it constitutional as applied to this plaintiff?” 244 Kan. 474. We held the 10-year limitation of K.S.A. 60-513(b) does apply to latent diseases and that such limitation is constitutional. Tomlinson claimed his personal injuries were caused by the exposure to asbestos which was man ufactured, sold, or distributed by the defendants. Tomlinson’s last exposure to asbestos was in 1971. His injuries, however, were not ascertained until September 1986.
Tomlinson filed his suit within 2 years of discovering his substantial injury but more than 10 years after his last exposure to asbestos. Although we stated “the rule announced in Ruthrauff remains applicable to the present case”, we ultimately held “the ten-year limitation contained in subsection (b) began, at the latest, upon the last exposure of the plaintiff to asbestos produced, sold, and distributed by the defendants in 1971.” 244 Kan. at 477, 481.
Recently this court overruled Tomlinson in Gilger v. Lee Constr., Inc., 249 Kan. 307, 318, 820 P.2d 390 (1991). In Gilger we again looked at K.S.A. 60-513 prior to the 1987 amendment. We ratified the rationale stated in Ruthrauff and other cases that “the statute of limitations under K.S.A. 60-513(b) is not triggered until substantial injury occurs or is reasonably ascertainable', regardless of the antiquity of the wrongful act which caused the injury.” 249 Kan. at 316. Moreover, if injury is suspected but the cause of the injury is not ascertainable until later, K.S.A. 60-513 bars an action thereon unless the facts of injury are ascertained and action commenced within 10 years of the substantial injury. 249 Kan. 307, Syl. ¶ 5. If the evidence of when the injury and its cause should have been known to plaintiff is controverted, the question of when plaintiff reasonably ascertained his or her substantial injury was caused by the defendant is a question of fact to be determined by a jury. 249 Kan. 307, Syl. ¶ 9.
In response to a suggestion made in Ruthrauff and in an attempt to make 10 years the absolute limit for filing actions, the legislature amended K.S.A. 60-513(b) in 1987. The amended subsection provides in pertinent part:
“(b) Except as provided in subsection (c), the causes of action listed in subsection (a) shall not be deemed to have accrued until the act giving rise to the cause of action first causes substantial injury, or, if the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall an action be commenced more than 10 years beyond the time of the act giving rise to the cause of .action.” (Emphasis added.)
The Ruthraujf rule, however, continued in effect for two years following the date of the amendment because of section (d):
“(d) The provisions of this section as it was constituted prior to July 1, 1987, shall continue in force and effect for a period of two years from that date with respect to any act giving rise to a cause of action occurring prior to that date.” K.S.A. 1991 Supp. 60-513.
In 1990, the legislature, in disagreement with our decision in Tomlinson, amended K.S.A. 60-3303 of the Kansas Product Liability Act. The amended statute provides in pertinent part:
“(a) (1) Except as provided in paragraph (2) of subsection (a) of this section, a product seller shall not be subject to liability in a product liability claim if the product seller proves by a preponderance of the evidence that the harm was caused after the product’s ‘useful safe life’ had expired. ‘Useful safe life’ begins at the time of delivery of the product and extends for the time during which the product would normally be likely to perform or be stored in a safe manner. For the purposes of this section, ‘time of delivery’ means the time of delivery of a product to its first purchaser or lessee who was not engaged in the business of either selling such products or using them as component parts of another product to be sold.
“(b) (1) In claims that involve harm caused more than 10 years after time of delivery, a presumption arises that the harm was caused after the useful safe life had expired. This presumption may only be rebutted by clear and convincing evidence.
“[2](D) The ten-year period of repose established in paragraph (1) of this subsection shall not apply if the harm was caused by prolonged exposure to a defective product, or if the injury-causing aspect of the product that existed at the time of delivery was not discoverable by a reasonably prudent person until more than 10 years after the time of delivery, or if the harm caused within 10 years after the time of delivery, did not manifest itself until after that time.
“(c) Except as provided in subsections (d) and (e), nothing contained in subsections (a) and (b) above shall modify the application of K.S.A. 60-513, and amendments thereto.
“(d) (1) In a product liability claim against the product seller, the ten-year limitation, as defined in K.S.A. 60-513, and amendments thereto, shall not apply to the time to discover a disease which is latent caused by exposure to a harmful material, in which event the action shall be deemed to have accrued when the disease and such disease’s cause have been made known to the person or at the point the person should have been aware of the disease and such disease’s cause.
“(2) The term ‘harmful material’ means any chemical substances commonly known as asbestos ....
“(e) Upon the effective date of this act through July 1, 1991, the provisions of this subsection shall revive such causes of action for latent diseases caused by exposure to a harmful material for: (1) Any person whose cause of action had accrued, as defined in subsection (d) on or after March 3, 1987 [the date of the Tomlinson decision]; or (2) any person who had an action pending in any court on March 3, 1989, and because of the judicial interpretation of the ten-year limitation contained in subsection (b) of K.S.A. 60-513, and amendments thereto, as applied to latent disease caused by exposure to a harmful material the: (A) Action was dismissed; (B) dismissal of the action was affirmed; or (C) action was subject to dismissal. The intent of this subsection is to revive causes of action for latent diseases caused by exposure to a harmful material which were barred by interpretation of K.S.A. 60-513, and amendments thereto, in effect prior to this enactment.” (Emphasis added.) K.S.A. 1991 Supp. 60-3303.
As a preliminary matter, we determine the statute of limitations in effect at the time the action was filed applies. It is a well-settled rule of law that “statutes complete in themselves, relating to a specific thing, take precedence over general statutes.” Szoboszlay v. Glessner, 233 Kan. 475, 479, 664 P.2d 1327 (1983). Because K.S.A. 1991 Supp. 60-3303 provides the limitation for bringing an action arising out of a latent disease caused by the harmful material asbestos, it is the applicable statute.
The first issue for resolution is whether K.S.A. 1991 Supp. 60-3303 is constitutional. It is axiomatic that statutes are presumed to be constitutional. We have stated it is the duty of the court when considering the constitutionality of a statute to resolve all doubts in favor of validity.
“Before a statute may be stricken down, it must clearly appear the statute violates the Constitution. Moreover, it is the court’s duty to uphold the statute under attack, if possible, rather than defeat it, and, if there is any reasonable way to construe the statute as constitutionally valid, that should be done.” Bair v. Peck, 248 Kan. 824, Syl. ¶ 1, 811 P.2d 1176 (1991).
K.C. Wall contends 60-3303 is unconstitutional as amended in 1990 because subsection (e) revives actions prohibited by K.S.A. 1991 Supp. 60-513, thereby denying potential defendants of a vested defense. K.C. Wall makes three arguments to support its contention; we address each.
First, K.C. Wall claims the legislature’s retroactive application of the amended statute violates K.C. Wall’s due process rights under either the Kansas or United States Constitutions. K.C. Wall contends Kansas’ statutes' of limitations are statutes of repose which create a vested right in the defense once the statutory limitation has run. Furthermore, K.C. Wall argues any retroactive law is unconstitutional to the extent it would destroy existing, vested rights constituting a taking of property without due process of law.
We have never specifically recognized a difference between a statute of limitations and a statute of repose. The United States District Court of Kansas, however, did make such a distinction in Menne v. Celotex Corp., 722 F. Supp. 662 (D. Kan. 1989). That case was similar to the one currently under consideration in that the original plaintiff suffered from malignant mesothelioma and contended his injuries were caused by exposure to asbestos products. The issue before the court was a conflict of laws question. The parties had stipulated the case should be tried according to the State of Nebraska’s substantive law and the procedural laws of Kansas applied. The court then had to determine whether K.S.A. 60-513(b), as construed by Tomlinson, was substantive or procedural. The court stated that
“statutes of limitation ‘are generally seen as running from the time of injury, or discovery of the injury in cases where that is difficult to detect. They serve to limit the time within which an action may be commenced after the cause of action has accrued. . . .’
“. . . The main purpose of such statutes is the prevention of stale claims, serving as ‘instruments of public policy and of court management, [which] do not confer upon defendants any right to be free from liability, although this may be their effect.’ ” 722 F. Supp. at 665-66.
It contrasted statutes of repose, stating they
“ ‘create time limitations which are not measured from the date of injury. These time limitations often run from defendant’s last act giving rise to the claim or from substantial completion of some service rendered by defendant.’ . . .
“. . . Because statutes of repose ignore the date of the injury or discovery of injury and generally lack tolling provisions, they are deemed to ‘acquire a substantive nature, barring rights of action even before injury has occurred if the injury occurs subsequent to the prescribed time period.’ ” 722 F. Supp. at 665-66.
See Goad v. Celotex Corp., 831 F.2d 508 (4th Cir. 1987), cert. denied 487 U.S. 1218 (1988); Wayne v. Tennessee Valley Authority, 730 F.2d 392 (5th Cir. .1984), cert. denied 469 U.S. 1159 (1985); Trustees of Rowan Technical College v. J. Hyatt Hammond Associates, Inc., 313 N.C. 230, 328 S.E.2d 274 (1985).
Applying these principles, the court found the 10-year provision of K.S.A. 60-513(b) “does not serve to limit stale claims as such. Rather, it operates as a general grant of immunity against claims arising more than ten years after the defendant’s actions.” 722 F. Supp. at 666. The court, therefore, held the 10-year provision of K.S.A. 60-513(b) is a statute of repose and, thus, a substantive rule of law.
Our failure to make a distinction between statutes of limitations and statutes of repose has led us to treat statutes of limitations as statutes of repose. See Schulte v. Westborough, Inc., 163 Kan. 111, 115, 180 P.2d 278 (1947). For example, in Morton v. Sharkey, 1 Kan. *535 (1860), the territorial supreme court addressed the validity of a new six-year limitation period for actions on commercial notes. The prior applicable statute of limitations was a three-year limitation on all contract actions. The court stated: “The rule is, that the limitation may be extended, where it has not already expired. A [cause of action] which is already barred by existing laws can not be revived by a new one.” 1 Kan. at *538.
Later this court was faced with determining the effect of changes in a statute of limitations in an ejectment case. Bowman, et al., v. Cockrill, 6 Kan. 311 (1870). In that case, where the title to real property turned upon the validity of a tax deed, we stated:
“[Statutes of limitations] can never operate where no cause of action exists; and can never operate except when rights have already been disturbed. The effect of the operation of the statute of limitations is not to create a cause of action; its effect is to take away a cause of action already created by acts of one or both of the parties. The effect is not to disturb rights, nor to transfer property; but to leave rights and property just where the parties themselves have voluntarily chosen to leave them during the running of the statute. The statutes of limitations simply say this to the party injured: ‘You have voluntarily allowed your property (real or personal as the case may be,) or the money you claim as compensation for some injury done to you, (on either contract or tort,) to remain in the possession of your adversary during a certain period without any effort to recover it, and now we will allow it to remain in the same place and in the same condition forever.’
“. . . After a cause of action is once barred by a statute of limitations it is not in the power of the legislature to revive it by subsequent legislation.” 6 Kan. at 338-40.
More recently, we held that when defendants have a vested right in the defense provided by the statute of limitations,
“[t]here is no distinction between a vested right of action and a vested right of defense. Accordingly, the general rule is that a vested right to an existing defense is protected in like manner as a right of action, with the exception only of those defenses which are based on informalities not affecting substantial rights.” Jackson v. American Best Freight System, Inc., 238 Kan. 322, 325, 709 P.2d 983 (1985).
Our failure to make a distinction between limitation and repose has caused K.C. Wall to claim its right to the defense of the statute of limitations vested pursuant to K.S.A. 1991 Supp. 60-513(b) not later than late 1986 because K.C. Wall’s predecessor stopped manufacturing and selling any asbestos-containing products in April 1976. Thus, K.C. Wall argues the 1990 amendment to K.S.A. 60-3303 with its retroactive provisions constitutes a taking of property without due process.
Judge Kelly of the United States District Court of Kansas was faced with this issue in Waller v. Pittsburgh Corning Corp., 742 F. Supp. 581 (D. Kan. 1990), aff'd 946 F.2d 1514 (10th Cir. 1991). There, the plaintiff claimed his personal injuries were due to exposure to asbestos products manufactured by the defendants. The plaintiff was exposed to asbestos-containing products between 1960 and 1976 and filed his suit more than 10 years after 1976. The court was asked to determine whether the plaintiff’s cause of action was barred under K.S.A. 60-513(b).
The court considered whether the 1990 amendment to K.S.A. 60-3303 revived the suit. The court noted the majority of states have found revivor statutes divest the defendant of a vested right to a limitations defense and violate due process. “These courts have taken the position that the passing of the limitations period creates a vested right of defense in the defendant, which cannot be removed by subsequent legislative action expanding the limitations period.” 742 F. Supp. at 583. Several states have not held such legislation offends due process. In Waller, the court found Kansas follows the majority view. Thus, the court held the 1990 amendment to K.S.A. 60-3303 was unconstitutional and in valid. It should be noted that Waller was decided while Tomlinson v. Celotex Corp., 244 Kan. 474, 770 P.2d 825 (1989), was in effect, which made K.S.A. 1991 Supp. 60-3303(e) applicable to both the 10-year statute of repose and the 2-year statute of limitations. We overruled Tomlinson in Gilger v. Lee Constr., Inc., 249 Kan. 307, 820 P.2d 390 (1991), in 1991. This left the retroactive provision of 60-3303 applicable only to the two-year statute of limitations since the action did not accrue until the latent disease was diagnosed.
Harding responded to K.C. Wall’s argument by citing Unified School Dist. No. 500 v. U.S. Gypsum Co., 719 F. Supp. 1003 (D. Kan. 1989). There, a school district brought suit against asbestos manufacturers for having installed asbestos-containing products in the school district’s buildings no later than 1972. The school district did not file its suit until 1988. Despite the fact statutes of limitations do not run against the state, including school districts, unless specifically provided by the statute, the defendants claimed the action was barred. Defendants contended 60-513(b) was a statute of repose and, therefore, their defense of the running of the 10-year provision was a vested right.
Judge O’Connor was “unconvinced that Kansas distinguishes between statutes of repose and statutes of limitation.”. 719 F. Supp. at 1005. The federal court relied upon our decision in Stephens v. Snyder Clinic Ass’n, 230 Kan. 115, 631 P.2d 222 (1981), in which we found the four-year limit of K.S.A. 60-513(c) to be constitutional. “ ‘A statute of limitation affects the remedy, only [and] does not impair rights and obligations.’ ” Stephens, 230 Kan. at 128-29. Judge O’Connor, therefore, held the 10-year provision of K.S.A. 60-513(b) was a statute of limitations.
It is important to bear in mind the change in K.S.A. 60-513(c) which was at issue in Stephens was an amendment changing the, limitation for actions arising out of services rendered by a health care provider from 10 years to 4 years. In Stephens, the issue was whether the statute violated the plaintiff’s right to a remedy under equal protection, not the defendant’s right to a defense.
Harding also relies on cases from other jurisdictions which hold, similar statutes reviving causes of actions did not violate due process. In Hymowitz v. Lilly & Co., 73 N.Y.2d 487, 539 N.E.2d 1069, cert. denied 493 U.S. 944 (1989), the plaintiffs alleged' injuries caused by diethylstilbestrol (DES) and brought suits against various DES manufacturers. The New York legislature had passed a statute which revived, for one year, actions for damages caused by latent effects of DES, asbestos, and other products.
The Court of Appeals of New York stated:
“The Federal Due Process Clause provides very little barrier to a State Legislature’s revival of time-barred actions (see, Chase Sec. Corp. v. Donaldson, 325 U.S. 304). In Chase, the United Stated Supreme Court upheld the revival of a time-barred action, stating that Statutes of Limitation 'represent a public policy about the privilege to litigate . . . the history of pleas of limitation show them to be good only by legislative grace and to be subject to a relatively large degree of legislative control.’ . . . ‘[t]he Legislature may constitutionally revive a personal cause of action where the circumstances are exceptional and are such as to satisfy the court that serious injustice would result to plaintiffs not guilty of any fault if the intention of the Legislature were not effectuated.’ ” 73 N.Y.2d at 514.
Harding asks us to adopt the HymouAtz standard and find that the legislature may constitutionally revive a personal cause of action in exceptional circumstances in order to avoid injustice.
K.C. Wall argues the legislature has no authority to enact retroactive legislation, citing Jackson v. American Best Freight System, Inc., 238 Kan. at 324-25, where we stated:
“A statute operates prospectively unless its language clearly indicates that the legislature intended that it operate retrospectively. . . .
“While retrospective operation of procedural statutes has been allowed generally, where a vested right of defense exists prior to the effective date of the procedural statute, it would not be proper to allow the retrospective application of 60-203(b) [the service of process provision].”
K.C. Wall cites Jackson to support its claim that the legislature may enact retroactive legislation only so long as it does not violate the state or federal constitutions and that K.S.A. 1991 Supp. 60-3303 violates both constitutions. Harding counters by claiming the legislature’s use of language in the 1990 amendment clearly expresses its intent to apply the amendment retroactively and the retroactive application is proper regardless of constitutional considerations, so long as she did not sleep on. her rights.
Let us examine whether K.S.A. 1991 Supp. 60-3303(e) violates the United States Constitution. The Fourteenth Amendment pro vides: “[N]or shall any State deprive any person of life, liberty, or property, without due process of law.” As previously noted in our discussion of Hymowitz, the United States Supreme Court decided this issue in Chase Securities Corp. v. Donaldson, 325 U.S. 304, 89 L. Ed. 1628, 65 S. Ct. 1137, reh. denied 325 U.S. 896 (1945). Chase involved a retroactive Minnesota statute lifting the bar of a statute of limitations on an action to recover the purchase price of fraudulently sold securities. The defendant asserted the defense of taking of property without due process under the Fourteenth Amendment.
The Court stated “[statutes of limitation find their justification in necessity and convenience rather than in logic” representing expedients rather than principles. 325 U.S. at 314. The Court found they are for the practical purpose of sparing the courts from litigation of stale claims and people from being put to the defense of claims after memories have faded and witnesses have disappeared. The Court further stated statutes of limitations are arbitrary, do not discriminate between just and unjust claims, and are creatures of the legislature and not the judiciary, expressing public policy on the right to litigate. The shelter afforded by the running of statutes of limitations does not amount to a fundamental right and the defense is subject to a large degree of legislative control. Justice Jackson, speaking for the Court, asserted:
“The Fourteenth Amendment does not make an act of state legislation void merely because it has some retrospective operation. . . . [I]t cannot be said that lifting the bar of a statute of limitation so as to restore a remedy lost through mere lapse of time is per se an offense against the Fourteenth Amendment.” 325 U.S. at 315-16.
Thus, we see the retroactive provision of K.S.A. 1991 Supp. 60-3303(e) does not violate the Fourteenth Amendment to the United States Constitution. The provision makes no distinction between statutes of limitations and statutes of repose.
We now turn to the Kansas Constitution Rill of Rights, § 18: “All persons, for injuries suffered in person, reputation or property, shall have remedy by due course of law.” As previously pointed out, we have recognized a defendant has a vested right to a defense after the statute of limitations has run, except where no substantial rights are affected. See Jackson v. American Freight System, Inc., 238 Kan. at 325. We have so held without distinguishing statutes of limitations from statutes of repose. Our failure to make this distinction makes it difficult to separate procedural law from substantive law. This is important to this case because the courts, have historically recognized that legislatures may by express provision make procedural law retroactive because no property rights are involved. A different rule applies, however, to substantive laws. They affect vested rights and are not subject to retroactive legislation which would constitute the taking of property without due process.
Even though the United States Supreme Court makes no distinction between statutes of limitations and statutes of repose, and we have not clearly expressed the distinction in our cases, we consider it important to explain the difference between the two theories. A statute of limitations extinguishes the right to prosecute an accrued cause of action, after a period of time. It cuts off the remedy. It is remedial and procedural. A statute of repose limits the time during which a cause of action can arise and usually runs from an act of a defendant. It abolishes the cause of action after the passage of time even though the cause of action may not have yet accrued. It is substantive. Thus, Kansas constitutional protection applies only to statutes of repose because they pertain to substantive rights.
The statute of limitations rule expressed in Schulte v. Westborough, Inc., 163 Kan. 111; Bowman, et al. v. Cockrill, 6 Kan. 311; and Morton v. Sharkey, 1 Kan. *535; remained the law of Kansas until 1951, when this court in Kitchener v. Williams, 171 Kan. 540, 236 P.2d 64 (1951), first held the statute of limitations in tort actions does not accrue until the date substantial injury is ascertained, as contrasted to the date the negligent act occurred. This principle was codified in K.S.A. 60-513 (Corrick) in 1963 and represents a change of public policy giving a less harsh application of the statute of limitations. K.S.A. 60-513(b) and (c) followed, creating statutes of repose for tort and medical malpractice actions, respectively. We construed these statutes in Gilger v. Lee Constr., Inc., 249 Kan. 307, 820 P.2d 390 (1991); Stephens v. Snyder Clinic, 230 Kan. 115; and, Ruthrauff, Administratrix v. Kensinger, 214 Kan. 185, 519 P.2d 661 (1974). The legislature clearly recognized a distinction between statutes of limitations and statutes of repose. We adhere to the legislature’s public policymaking authority and, therefore, we recognize the distinction between the two theories as previously expressed.
With our recognition of the distinction between statutes of repose and statutes of limitations, we modify the rule in Morton v. Sharkey, Bowman et al. v. Cockrill, and other cases which prohibit the legislature from reviving causes of action barred by a statute of limitations. The legislature has the power to revive actions barred by a statute of limitations if it specifically expresses its intent to do so through retroactive application of a new law. The legislature cannot revive a cause of action barred by a statute of repose, as such action would constitute the taking of property without due process.
This rule does not apply to causes of action affecting the title to real estate or personal property because such actions involve substantive or vested rights and, thus, cannot be revived regardless of any distinction between statutes of limitations and statutes of repose. The statutes we are construing here do not affect such rights.
Let us now examine the applicable Kansas statutes. The standard two-year limitation of actions found in K.S.A. 1991 Supp. 60-513(a) is a statute of limitations. It fits the definition completely. However, the 10-year provision in K.S.A. 1991 Supp. 60-513(b), “but in no event shall an action be commenced more than 10 years beyond the time of the act giving rise to the cause of action,” is a statute of repose. It bars the cause of action after the 10-year period even though the action may not have yet accrued.
In this case, K.C. Wall argues K.S.A. 1991 Supp. 60-3303(e) applies to both the 2-year and the 10-year provisions found in K.S.A. 1991 Supp. 60-513. That argument ignores the existence of K.S.A. 1991 Supp. 60-3303(b)(2)(D), enacted in 1981, which specifically exempts the type of injury alleged in the petition from application of the 10-year period of repose.
Prior to the 1990 amendment, K.S.A. 60-3303(c) provided: “Nothing contained in subsections (a) and (b) above shall modify the application of K.S.A. 60-513.”
It is sometimes claimed that subsection (c) nullifies the exemption provided in (b)(2)(D). See Westerbeke, Some Observa tions on the Kansas Product Liability Act (Part 1), 53 J.K.B.A. 296, 308 (1984). We do not agree. At the time K.S.A. 60-3303 was enacted in 1981, K.S.A. 60-513 had been interpreted by Ruthrauff, Administrator v. Kensinger, 214 Kan. 185. Ruthrauff held the statute of repose was not triggered until substantial injury occurred but was not reasonably ascertainable. Thus, when K.S.A. 60-3303 was enacted there was no conflict between it and K.S.A. 60-513. Moreover, because 60-3303(b)(2)(D) already exempted from the 10-year repose provision causes of action involving harm “caused by prolonged exposure to a defective product . . . existing] at the time of delivery [that] was not discoverable by a reasonably prudent person,” the revival provision of 60-3303, as amended in 1990, did not affect the existing exemption.
Hence, K.S.A. 1991 Supp. 60-3303(e) applies retroactively only to the two-year statute of limitations K.S.A. 1991 Supp. 60-513(a). As we previously noted, a defendant has no vested right in a statute of limitations. It is an expression of legislative public policy, is procedural, and may be applied retroactively when the legislature expressly makes it so. We hold K.S.A. 1991 Supp. 60-3303(e) is not in violation of either the Kansas or United States Constitutions.
To be entitled to the benefits of such legislation, however, K.S.A. 1991 Supp. 60-3303(e) requires that the parties claiming the right to revivor must not have slept on their rights. To make such a determination, we must review the applicable chronology.
On March 3, 1989, we filed Tomlinson v. Celotex Corp., 244 Kan. 474, 770 P.2d 825 (1989), where we held the 10-year repose provision of K.S.A. 60-513(b) was triggered by the victim’s last exposure to the disease-producing substance. This decision eliminated Harding’s remedy one year before the two-year statute of limitations found in K.S.A. 60-513(a) ran. Tomlinson remained the law until the legislature enacted K.S.A. 1991 Supp. 60-3303(e) on May 24, 1990. Harding filed suit September 5, 1990, under authority of that statute. We did not overrule Tomlinson in Gilger v. Lee Construction until October 1991. We hold Harding acted with due diligence under the facts of this case. This action was not filed in violation of the statute of limitations.
K.C. Wall’s last challenge to the constitutionality of K.S.A. 1991 Supp. 60-3303(e) is that H.B. 2689 violates Article 2, section 16 of the Kansas Constitution. Article 2, § 16 provides:
“Subject and title of bills; amendment or revival of statutes. No bill shall contain more than one subject, except appropriation bills and bills for revision or codification of statutes. The subject of each bill shall be expressed in its tide. No law shall be revived or amended, unless the new act contain the entire act revived or the section or sections amended, and the section or sections so amended shall he repealed. The provisions of this section shall be liberally construed to effectuate the acts of the legislature.” (Emphasis added.)
K.C. Wall contends H.R. 2689 amended 60-513 as amended in 1987 and that amendment was not in compliance with the provision of Kansas Const, art. 2, § 16 requiring the new act to contain the entire law amended and the repeal of the old law. K.C. Wall further claims that placing the statute of limitations for latent diseases in the Kansas Product Liability Act creates confusion, which Art. 2, § 16 is designed to avoid. For support, K.C. Wall points out that Judge Kelly mistakenly believed H.R. 2689 amended K.S.A. 60-513 when he considered Waller v. Pittsburgh Corning Corp., 742 F. Supp. 581 (D. Kan. 1990).
Judge Kelly issued the Waller opinion on July 16, 1990, before the 1990 Kansas session laws were available to him. The session laws clearly state H.B. 2689 is “[a]n Act concerning civil procedure; relating to limitation of actions; amending K.S.A. 60-3303 and repealing the existing section.” (Emphasis added.) L. 1990, ch. 211.
The standard for our review of this issue was discussed in State v. Reves, 233 Kan. 972, Syl. ¶ 1, 666 P.2d 1190 (1983).
“Art. 2, § 16, of the Kansas Constitution should not be construed narrowly or technically to invalidate proper and needful legislation, and where the subject of the legislation is germane to other provisions, the act is not objectionable as containing more than one subject or as containing matter not expressed in the title. This provision is violated only where an act embraces two or more dissimilar and discordant subjects that cannot reasonably be considered as having any legitimate connection with or relationship to each other.”
There are numerous statutes of limitations and as a general rule they appear in Article 5 of Chapter 60. K.S.A. 60-501 provides: “The provisions of this article govern the limitation of time for commencing civil actions, except where a different limitation is specifically provided by statute” (Emphasis added.)
We find it was appropriate to place the provision of H.B. 2689 governing the time in which a products liability cause of action arising from a latent disease caused by specific harmful materials in a statute which is a part of the Kansas Products Liability Act. Therefore, we hold H.B. 2689 does not violate Art. 2, § 16 of the Kansas Constitution.
The judgment of the district court is affirmed, and this case is remanded for further proceedings consistent with this opinion. | [
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The opinion of the court was delivered by
McFarland, J.:
Todd A. Hainline appeals from the judgment of the district court affirming the 140-day suspension of his teaching certificate imposed by the State Board of Education. The suspension was based upon the commission of an act of immorality, namely burglary and theft.
The facts may be summarized as follows. On March 19, 1989, Wichita police officers responded to a burglary call at the former NoMar Theater located at 2141 North Market. The building was being used as a furniture warehouse by its owner, Basham’s Furniture Rental, Inc. Padlocks on two doors securing the building had been cut off. The building was searched by the officers. Hainline and a friend were discovered lying on the floor behind some boxes. Hainline was arrested and charged with burglary and theft. At the time he was a certified Kansas teacher employed by U.S.D. 259 and was assigned to teach art at Southeast High School. Upon his arrest, Hainline was suspended with pay by U.S.D. 259. After Hainline entered into a diversion agreement, U.S.D. 259 transferred him to North High School.
The Secretary to the Professional Practices Commission (Commission) of the State Board of Education (Board) filed a complaint with the Commission seeking revocation of Hainline’s certificate. On February 28, 1990, the Commission filed its “Initial Order,” which recommended that Hainline’s teaching certificate be sus pended until July 30, 1990. On March 14, 1990, the Board entered its “Final Order,” which adopted the Commission’s order and suspended Hainline’s certificate for 140 days commencing on the “date of final resolution of this matter.” Hainline filed a motion for reconsideration, which was denied. He then filed an appeal to the district court. The district court affirmed the Board. Hainline has duly perfected his appeal from the judgment of the district court.
For his first issue on appeal, Hainline argues that the statute under which the Board proceeded, K.S.A. 72-1383, is of no legal force and effect. To place this issue into context, it is necessary to set forth the following constitutional provision, statute, and regulation:
Kan. Const, art. 6, § 2(a):
“(a) The legislature shall provide for a state board of education which shall have general supervision of public schools, educational institutions and all the educational interests of the state, except educational functions delegated by law to the state board of regents. The state board of education shall perform such other duties as may be provided by law.”
K.S.A. 72-1383:
“Any certificate issued by the state board of education or institutions under the state board of regents may be canceled by the state board of education in the manner provided by law, on the grounds of immorality, gross neglect of duty, annulling of written contracts with boards of education without the consent of the board which is a party to the contract, or for any cause that would have justified the withholding thereof when the same was granted.”
K.A.R. 91-1-61:
“(a) Any certificate may be cancelled or revoked, suspended, or denied by the state board for the following reasons:
(1) Conviction of, or a plea of guilty for violation of any law punishable as a felony; or
(2) Evidence that a certificate holder has injured the health or welfare of a child through physical or sexual abuse or exploitation. For the purposes of this paragraph, a certified copy of a court record showing that a certificate holder was convicted in a state or federal court of the commission of an act involving the physical or sexual abuse, exploitation of a child, or any of the acts in subsection (a)(1) within the previous five years shall be considered sufficient evidence.
“(b) Cancellation or revocation or suspension of a certificate shall cancel, revoke or suspend all endorsements on the certificate. Cancellation or rev ocation of a certificate shall be permanent, subject to the reinstatement provisions in subsection d; suspension of a certificate shall be for a definite period of time.”
Within this issue, Hainline makes three contentions:
1. The statute is not in harmony with the regulation and, as the constitutional provision is self-executing, the regulation takes priority over the statute.
2. The statute is unconstitutional.
3. The Board cannot disregard its own policy as expressed in the regulation.
The thrust of this issue is that the Kansas Constitution grants the Board the authority of general supervision over the schools and all the educational interests of the state (except those in the area of the State Board of Regents). K.S.A. 72-1383, it is argued, is not in harmony therewith and, accordingly, is of no force and effect. Additionally, the argument is made that the adoption of K.A.R. 91-1-61 operates to supplant the statute. We do not agree.
It is true that art. 6, § 2(a) of the constitution has been held to be self-executing, which means no supplementary legislation is needed to make it effective. State, ex rel., v. Board of Education, 212 Kan. 482, 511 P.2d 705 (1973). Where a constitutional provision is self-executing, the legislature may enact legislation to facilitate or assist in its operation, but whatever legislation is adopted must be in harmony with and not in derogation of the provisions of the constitution. 212 Kan. 482, Syl. ¶ 7.
K.S.A. 72-1383 is not in derogation of the constitutional provision. It does not reduce the Board’s supervisory authority by delegating any part thereof to another entity. It does not require the Board to do or not do anything.
Hainline also argues that K.S.A. 72-1383 conflicts with K.A.R. 91-1-61, and the regulation, therefore, supersedes the statute. The Board argues that this would repeal the statute by implication and that such repeals are not favored. It cited City of Salina v. Jaggers, 228 Kan. 155, Syl. ¶ 2, 612 P.2d 618 (1980), wherein we held:
“Repeal by implication is not favored and acts will not be held to have been repealed by implication unless a later enactment is so repugnant to the provisions of the first act that both cannot be given force and effect.”
This concept has even greater force when a later adopted regulation is urged to have repealed, by implication, a previously enacted statute.
The Board notes that it continued to exercise authority under K.S.A. 72-1383 after it adopted the regulation. The Board’s position is that it considers the statute and the regulation as supplementary to each other. The Board’s order herein actually combines the two. The reason for the Board’s action was an act of immorality (from the statute), but the penalty imposed, suspension of Hainline’s certificate for a fixed period, is grounded in the regulation. The statute speaks only of revocation of a certificate. We agree with the Board’s position and find no merit in Hainline’s argument in this regard.
Finally, Hainline argues the policy of the Board is expressed in the regulation. Hainline contends that the failure of the regulation to include immorality eliminates that ground as a cause for suspension of his certificate and that the final order herein is, accordingly, contrary to the Board’s stated policy. We find no merit in this argument. There is nothing in the record to indicate that the Board, by adopting the regulation, was fixing a policy which was intended to replace or supersede the statute.
For his second issue, Hainline contends the suspension of his certificate deprives him of substantive due process. Although the precise contentions made in this issue are difficult to ascertain, the point appears to be that the Board was required to find that Hainline’s felonious conduct impaired his ability to perform his job before the suspension could be imposed; that there must be a “nexus” between his conduct and job performance. Failure to find this nexus, according to Hainline, resulted in the deprival of his rights to substantive due process. The term nexus is used to denote the relationship between the complained-of conduct and job performance. The difficulty in applying this concept to the facts before us is that in the cases cited in support of this issue, noncriminal conduct gave rise to the sanctions.
In Pickering v. Board of Education, 391 U.S. 563, 20 L. Ed. 2d 811, 88 S. Ct. 1731 (1968), the Court held that a board of education could not dismiss a teacher for writing a letter to the editor that was critical of school board expenditures. The penalty was being imposed by virtue of the teacher’s exercise of the right of free speech.
In Shelton v. Tucker, 364 U.S. 479, 5 L. Ed. 2d 231, 81 S. Ct. 247 (1960), the Court held unconstitutional an Arkansas statute requiring teachers to disclose any and all organizations that they had been affiliated with in the past five years. The statute was struck down as impinging upon constitutionally protected conduct — free speech and freedom of association.
In Schware v. Board of Bar Examiners, 353 U.S. 232, 1 L. Ed. 2d 796, 77 S. Ct. 752 (1957), the Court considered a case in which a candidate for the New Mexico state bar was denied a license to practice for failure to demonstrate “good moral character.,” The basis for the board’s denial was that Schware had belonged to subversive organizations, used aliases, and had been arrested.
The Court examined the facts of the case, which were that Schware had been interested in socialism, communism, and unionism in the 1930s, but that he quit the Communist Party in 1940 because he became disillusioned with it. Far from being anti-American, Schware had volunteered for service as a paratrooper during World War II and was eventually honorably discharged. Schware’s only use of aliases was prior to his service in the army and was only to forestall anti-Jewish prejudices in getting and retaining a job. Schware had been arrested for suspicion of criminal syndicalism and violation of the Neutrality Act of 1917, but had never been convicted.
The Court said the question was one of (substantive) due process or equal protection: “A State can require high standards of qualification, such as good moral character or proficiency in its law, before it admits an applicant to the bar, but any qualification must have a rational connection with the applicant’s fitness or capacity to practice law.” 353 U.S. at 239.
See Konigsherg v. State Bar, 353 U.S. 252, 1 L. Ed. 2d 810, 77 S. Ct. 722, reh. denied 354 U.S. 927 (1957). Using a different approach, the Court has looked to see if the suspension of a physician’s license was “arbitrary or capricious.” See Barsky v. Board of Regents, 347 U.S. 442, 98 L. Ed. 829, 74 S. Ct. 650 (1954).
In Morrison v. State Board of Education, 1 Cal. 3d 214, 82 Cal. Rptr. 175, 461 P.2d 375 (1969), the California State Board of Education had revoked the certificate of a teacher on grounds of moral turpitude. The teacher had been involved in a noncriminal homosexual relationship with another teacher who later reported the incident to the school board. The California court held that a showing needed to be made that retention of the teacher presented a significant danger of harm to students or fellow teachers. 1 Cal. 3d at 237. This appears to be one of the strongest “pro-nexus” cases.
But in a later case involving conduct that was both public and criminal, Pettit v. State Board of Education, 10 Cal. 3d 29, 109 Cal. Rptr. 665, 513 P.2d 889 (1973), Morrison was distinguished. In Pettit the female teacher engaged in several public acts of oral copulation with various members of a sex club. The court stated: “Even without expert testimony, the board was entitled to conclude that plaintiff s flagrant display indicated a serious defect of moral character, normal prudence and good common sense.” 10 Cal. 3d at 35.
In Kenai Peninsula Borough Bd. of Educ. v. Brown, 691 P.2d 1034 (Alaska 1984), the teacher was dismissed for “immorality, which is defined as the commission of an act which, under the laws of the state, constitutes a crime involving moral turpitude.” 691 P.2d at 1036 n. 1. The teacher had been convicted of diverting electricity. He argued in appealing his termination that there was no nexus between his conduct and his job. The Alaska court held:
“The finding that a crime involving moral turpitude has been committed raises at least a presumption that there is a nexus between the teacher’s act and the teacher’s fitness to teach. The legislature, in enacting certain criminal statutes, has established minimum acceptable moral standards for the state as a whole. If a teacher cannot abide by these standards his or her fitness as . a teacher is necessarily called into question. Of course, during the hearing . . . the teacher may attempt to demonstrate that the Board should retain the teacher despite the finding of a crime involving moral turpitude.” 692 P.2d at 1041.
See Denton v. South Kitsap Sch. Dist., 10 Wash. App. 69, 72, 516 P.2d 1080 (1973) (holding that certain “immoral” acts , inherently call into question a person’s fitness to teach).
Hainline does not argue that burglary and theft involve some constitutionally protected right of conduct such as free speech or free association. We believe the Kenai Peninsula case represents a reasonable approach.
K.S.A. 72-8501 provides:
“It is the intent and purpose of the legislature that the practice of teaching and its related services, including school administration and supervisory services, shall be designated as professional services. Teaching and school administration are hereby declared to be professions in Kansas with all the similar rights, responsibilities, and privileges accorded other legally recognized professions.”
Obviously, one of the goals of education is to instill respect for the law. Teachers are role models for their students. Hainline’s burglary offense was publicized' by the Wichita media. There is at least a presumption that the felonious conduct has sufficient relationship or nexus to Hainline’s -fitness to teach to warrant action by the Board herein. The fact that Hainline’s employer, the Board of Education of U.S.D. 259, has been supportive of him may well have been a factor in the State Board’s decision to suspend the certificate rather than revoke it, but that is irrelevant to the Board’s power to act.
A certificate granted by the Board is certification statewide. Teaching is a profession as declared in K.S.A. 72-8501 subject to professional responsibilities. Burglary is a felony. A professional code of conduct which requires a person not to commit a felony can hardly be considered arbitrary or capricious. It would appear to be about as basic a requirement as can be imposed. Conviction of a felony, whether or not related to the practice of medicine, is grounds for revocation of a license issued by the Board of Healing Arts. K.S.A. 1990 Supp. 65-2836. Conviction of a felony is grounds for license revocation of an architect, land surveyor, or engineer. K.S.A. 74-7026. We have numerous cases disciplining attorneys for commission of a felony unrelated to the practice of law. For example, see In re Laing, 246 Kan. 334, 788 P.2d 284 (1990), and In re Barritt, 243 Kan. 519, 757 P.2d 730 (1988). The teaching profession, with its great influence on young people, certainly has no lesser justification for the discipline of a person within its ranks who has committed a felony.
We find this issue to be without merit.
For his next issue, Hainline contends suspension of his teaching certificate for conduct unrelated to his work violates his constitutional right to privacy.
In Wishart v. McDonald, 500 F.2d 1110, 1113-14 (1st Cir. 1974), the court considered whether a teacher’s “right of privacy” was violated by revocation of his teaching certificate for conduct occurring outside of school. Wishart’s certificate was revoked after he was repeatedly observed lewdly fondling a mannequin in his front yard. He argued the termination violated his right to privacy. The court said, “The right of privacy, even as advocated in Warren & Brandéis, The Right to Privacy, 4 Harv. L. Rev. 193 (1890), may be surrendered by public display. The right to be left alone in the home extends only to the home and not to conduct displayed under the street lamp on the front lawn.”
There is no right of privacy involved in the commission of a burglary, at least as far as the felon is concerned. The fact that Hainline ultimately entered into a diversion agreement is irrelevant. In the diversion agreement, Hainline admitted to facts constituting burglary. Felonies are public offenses. The issue is without merit.
For his final point, Hainline contends that the term “immorality,” as used in K.S.A. 72-1383, is unconstitutionally vague. In this issue, Hainline relies primarily on Burton v. Cascade School Dist. Union High Sch. No. 5, 353 F. Supp. 254 (D. Or. 1973), aff'd 512 F.2d 850 (9th Cir.), cert. denied 423 U.S. 839 (1975), in which the court held that an Oregon statute allowing termination of a teacher’s employment for reason of “immorality” was unconstitutionally vague. The court reasoned:
“Immorality means different things to different people, and its definition depends on the idiosyncracies of the individual school board members. It may be applied so broadly that every teacher in the state could be subject to discipline. The potential for arbitrary and discriminatory enforcement is inherent in such a statute.” 353 F. Supp. at 255.
Burton was terminated for being a homosexual. No specific instances of wrongful conduct were alleged.
Most jurisdictions that have considered the constitutionality of similar statutes have upheld them. See, e.g., Wishart, 500 F.2d at 1116; Morrison, 1 Cal. 3d at 228-34; Weissman v. Bd. of Educ., 190 Colo. 414, 422-24, 547 P.2d 1267 (1976); Tomerlin v. Dade County School Board, 318 So. 2d 159 (Fla. Dist. App. 1975).
The constitutionality of a statute is presumed and all doubts must be resolved in favor of its validity. Before the statute may be struck down, it must clearly appear the statute violates the constitution. It is the court’s duty to uphold the statute under attack, if possible, rather than defeat it, and, if there is any reasonable way to construe the statute as constitutionally valid, that should be done. Guardian Title Co. v. Bell, 248 Kan. 146, 149, 805 P.2d 33 (1991).
Most challenges for vagueness are against criminal statutes.
“The test to determine whether a criminal statute is unconstitutional by reason of being vague and indefinite is whether its language conveys a sufficiently definite warning as to the conduct proscribed when measured by common understanding and practice. A statute which either requires or forbids the doing of an act in terms so vague that persons of common intelligence must necessarily guess at its meaning and differ as to its application is violative of due process.” State v. Meinert, 225 Kan. 816, Syl. ¶ 2, 594 P.2d 232 (1979).
The statute here is not criminal.
“In determining constitutional challenges for vagueness, greater leeway is afforded statutes regulating business than those proscribing criminal conduct. ”
“A common-sense determination of fairness is the standard for determining whether a statute regulating business is unconstitutional for vagueness, i.e., can an ordinary person exercising common sense understand and comply with the statute? If so, the statute is constitutional.” Guardian Title Co. v. Bell, 248 Kan. 146, Syl. ¶¶ 3, 4.
See Armored Services, Inc. v. City of Wichita, 248 Kan. 136, 139, 804 P.2d 987 (1991).
The vagueness challenge here must be a limited one. The United States Supreme Court has repeatedly stated, “[V]agueness challenges to statutes which do not involve First Amendment freedoms must be examined in the light of the facts of the case at hand.” United States v. Mazurie, 419 U.S. 544, 550, 42 L. Ed. 2d 706, 95 S. Ct. 710 (1975). This means that the statute is judged on an “as-applied” basis. Maynard v. Cartwright, 486 U.S. 356, 361, 100 L. Ed. 2d 372, 108 S. Ct. 1853 (1988). See Chapman v. United States, 500 U.S. _, 114 L. Ed. 2d 524, 540, 111 S. Ct. 1919, reh. denied _ U.S. _ (1991); Hoff man Estates v. Flipside, Hoffman Estates, 455 U.S. 489, 495 n.7, 71 L. Ed. 2d 362, 102 S. Ct. 1186 (1982); United States v. Powell, 423 U.S. 87, 92-93, 46 L. Ed. 2d 228, 96 S. Ct. 316 (1975); United States v. Mazurie, 419 U.S. at 550; Palmer v. City of Euclid, 402 U.S. 544, 29 L. Ed. 2d 98, 91 S. Ct. 1563 (1971); United States v. National Dairy Corp., 372 U.S. 29, 32-33, 36, 9 L. Ed. 2d 561, 83 S. Ct. 594, reh. denied 372 U.S. 961 (1963).
Kansas has previously considered a similar claim of vagueness. In Kansas State Board of Healing Arts v. Foote, 200 Kan. 447, 436 P.2d 828 (1968), this court reviewed proceedings against a doctor for unprofessional conduct. The court discussed a statute which made “immoral ... or dishonorable conduct” grounds for revocation. See K.S.A. 65-2836.
“It would indeed be difficult, not to say impractical, in carrying out the purpose of the act, for the legislature to list each and every specific act or course of conduct which might constitute such unprofessional conduct of a disqualifying nature. Nor does any such failure leave the statute subject to attack on grounds of vagueness or indefiniteness. Our statute makes no attempt to delineate what acts are included in the terms immoral or dishonorable conduct, which are also made grounds for revocation. The determination whether by common judgment certain conduct is disqualifying is left to the sound discretion of the board.” 200 Kan. at 453-54.
In Kansas State Board of Healing Arts v. Acker, 228 Kan. 145, 612 P.2d 610 (1980), this court considered a claim that K.S.A. 65-2836 was vague. This court held that it was not vague, relying in part on Foote. This court also suggested that terms such as immoral, dishonorable, or unprofessional contemplate conduct which inherently shows that the person is incompetent to practice the profession. 228 Kan. at 150.
The term “immorality,” as used in K.S.A. 72-1383, means such conduct that by common judgment reflects on a teacher’s fitness to engage in his or her profession. Hainline testified at the suspension hearing that his immediate concern when he heard police in the furniture warehouse was that he would lose his job. Such a reaction would undoubtedly be a common one of any teacher in a like position. Commission of a felony is not an activity on the fringe of the term “immorality” or one arising solely from religious tenets. It is a criminal offense as defined by the legislature, subjecting a person convicted thereof to possible im prisonment. Adequate notice that such conduct was prohibited and within the term “immorality” is present and defeats any claim of vagueness as applied herein.
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The opinion of the court was delivered by
Herd, J.:
Ashley Ball, an infant passenger, was injured when the car owned and driven by her mother was hit by a train. Ashley, through her father Joseph Ball, sought uninsured motorist benefits under a policy issued to her mother by Midwestern Insurance Company on another vehicle. When Midwestern denied coverage, Ball filed this declaratory judgment action. The district court granted Ball’s motion for summary judgment, finding Ashley was covered by her mother’s policy. Midwestern appeals.
Ashley is the daughter of Joseph and Stephanie Ball. In May 1987, Stephanie’s mother gave them a 1977 Chevrolet Chevette. The Chevette was titled in Joseph’s and Stephanie’s their names and was uninsured. The Balls knew it was illegal to drive an uninsured vehicle, but Joseph drove it to work five days a week. Stephanie did not drive the Chevette without Joseph’s permission and did not have a set of keys. Prior to the accident, Ashley had ridden in the Chevette only a few times.
In September 1987, Joseph and Stephanie acquired a 1985 Chevrolet Nova, which Stephanie usually drove thereafter. The Nova was insured by a policy issued by Midwestern Insurance Company. Stephanie took Ashley to the babysitter every day in the Nova. In the evenings, and on weekends, Stephanie and Joseph would usually drive the Nova.
On the day of the accident, April 10, 1988, Stephanie borrowed the Chevette because of mechanical difficulties with the Nova. At the time of the collision 13-month-old Ashley occupied an infant seat in the rear of the Chevette. The Chevette stalled on some railroad tracks, Stephanie was unable to start it, and a train struck the car. Ashley sustained permanent injuries as a result of the accident.
Because there was no insurance on the Chevette, Ball sought uninsured motorist benefits in the amount of $25,000 under the Nova’s policy. Midwestern denied coverage and Ball filed this declaratory judgment action. Midwestern filed a motion for judgment on the pleadings, which the district court denied.
Both parties moved for summary judgment. The district court granted Ball’s motion for summary judgment upon a finding the Chevette was not provided for the regular use of Ashley within the meaning of the exclusion authorized by K.S.A. 40-284(e)(l). Thus, Ashley was covered by the uninsured motorist provision of Stephanie’s policy with Midwestern on the Nova.
The issue on appeal is whether the district court erred in finding Ashley, as an insured under the policy, is entitled to uninsured motorist benefits.
In Kansas, every policy of motor vehicle liability insurance is required to provide a minimum coverage for the uninsured motorist of $25,000 per person and $50,000 per accident, within certain exclusions and limitations of coverage. K.S.A. 40-3107(e), (h), (i). This court has stated the purpose of this legislative mandate as follows:
“ ‘The purpose of legislation mandating the offer of uninsured motorist coverage is to fill the gap inherent in motor vehicle financial responsibility and compulsory insurance legislation and this coverage is intended to provide recompense to innocent persons who are damaged through the wrongful conduct of motorists who, because they are uninsured and not financially responsible, cannot be made to respond in damages. [Citation omitted.] As remedial legislation it should be liberally construed to provide the intended protection.’ ” Stewart v. Capps, 247 Kan. 549, 551, 802 P.2d 1226 (1990) (quoting Winner v. Ratzlaff, 211 Kan. 59, 63-64, 505 P.2d 606 [1973]).
Liability insurance is third-party insurance and designed to protect persons injured by the insured, not to protect the insured. In contrast, uninsured motorist coverage is first-party insurance, designed to protect the insured. Uninsured motorist insurance provides coverage to the insured and is not tied or limited to actual occupancy of a particular vehicle. Instead, uninsured motorist coverage protects the insured, whether in a described vehicle, a non-owned vehicle, or on foot. See Farmers Ins. Co. v. Gilbert, 14 Kan. App. 2d 395, 401, 791 P.2d 742, aff'd as modified 247 Kan. 589, 802 P.2d 556 (1990). K.S.A. 40-284(e) provides for certain exclusions and limitations in motor vehicle coverage. “Insurance policy provisions which purport to condition, limit, or dilute the unqualified uninsured motorist coverage mandated by K.S.A. 40-284 are void and unenforceable as being violative of public policy.” Stewart v. Capps, 247 Kan. 549, Syl. ¶ 3. Insurance policy provisions, however, may condition, limit, or dilute uninsured motorist coverage as long as such exclusions and limitations fall within the exclusions and limitations expressly allowed by statute.
K.S.A. 40-284(e)(l) provides in pertinent part:
“(e) Any insurer may provide for the exclusion or limitation of coverage:
“(1) When the insured is occupying or struck by an uninsured automobile or trailer owned or provided for the insured’s regular use.”
Midwestern’s policy on the Nova provides in pertinent part:
“A. We will pay damages which an insured is legally entitled to recover from the owner or operator of an uninsured motor vehicle because of bodily injury:
“1. Sustained by an insured ....
“B. Insured as used in this part means;
“1. You or any family member.
“C. Uninsured motor vehicle means a land motor vehicle or trailer of any type:
“1. To which no bodily injury liability bond or policy applies at the time of the accident.
“However, uninsured motor vehicle does not include any vehicle or equipment:
“1. Owned by or furnished or available for the regular use of you or any family member.”
When considering Midwestern’s motion for judgment on the pleadings, the district court found Ashley was covered by the uninsured motorist policy and therefore, by implication, the policy’s exclusion was broader than that allowed by K.S.A. 40-284(e)(1). If an insurance policy’s exclusion is too broad and thus unenforceable, the statutory exclusions provided by K.S.A. 40-284(e) are applied to the policy coverage to replace the unenforceable provisions.
When ruling on the parties’ motions for summary judgment, the district court found the legislative intent of K.S.A. 40-284 “was to deal with persons who failed to insure their own vehicles.” Thus, the court found Ashley was not excluded from coverage. Relying upon Central Security Mut. Ins. Co. v. DePinto, 235 Kan. 331, Syl. ¶ 5, 681 P.2d 15 (1984), the district court went on to determine “regular use” as contemplated in K.S.A. 40-284(e)(1) would likewise be “defined as continuous use; uninterrupted normal use for all purposes; without limitation as to use; and customary use as opposed to occasional or special use.” Based upon this definition and the facts of the case, the district court held Ashley did not have regular use of the Chevette.
In order to nullify the district court’s interpretation of “regular use” set out in K.S.A. 40-284(e)(l), Midwestern first contends that statute applies only to mandatory coverage which is to the named insured, Stephanie, leaving it free to impose any exclusions it desires on Ashley. This argument is without merit. K.S.A. 40-284(e)(l) governs all exclusions from coverage, not just “mandatory coverage.”
Next, Midwestern argues that although the State of Kansas has enacted financial responsibility laws requiring every owner to purchase liability insurance for his or her vehicle, the State does not protect owners of vehicles who knowingly violate those laws. Hence, insurance companies are not required to provide uninsured motorist coverage to an owner who chooses to insure one vehicle and not another. See Farmers Ins. Co. v. Gilbert, 14 Kan. App. 2d at 404. Because Stephanie chose not to insure the Chevette and therefore can be excluded from coverage, Midwestern claims Ashley, as a family member, can also be properly excluded.
For support Midwestern cites Petrich by Lee v. Hartford Fire Ins. Co., 427 N.W.2d 244 (Minn. 1988). In Petrich, the plaintiff’s stepfather purchased insurance on two of his three vehicles. The plaintiff was injured while occupying the uninsured vehicle. As an additional insured under his stepfather’s policy, plaintiff sought uninsured motorist coverage under his stepfather’s policy covering the other two vehicles. The Minnesota Supreme Court found plaintiff was attempting to use his first-party coverage (uninsured motorist coverage) as third-party (liability) coverage. Noting liability insurance and uninsured motorist coverage compensate different risks and the premium is much less for uninsured motorist coverage, the court held the insurer of the other two vehicles did not owe the plaintiff uninsured motorist coverage. The court also stated:
“Viewed from the perspective of the claimant, it might be argued that it is unfair to an additional insured to be denied uninsured motorist coverage because the named insured fails to insure the vehicle involved in the accident. Members of the policyholder’s family might not own a car and hence could not purchase auto insurance of their own to protect themselves against the other policyholder’s failure to insure his vehicles. But this complaint should be directed to the car owner who has a responsibility for insuring his cars [pursuant to state law], not to the insurer which must fashion its premium structure to defined risks and can only react to the policyholder’s decision to insure or not to insure.” 427 N.W.2d at 246.
Prior to the enactment of 40-284(e) in 1981, vehicle owners who had uninsured motorist insurance on one vehicle and not on another were able to collect uninsured motorist benefits when they were injured in their own uninsured vehicle. This allowed vehicle owners to pay for uninsured motorist coverage for only one vehicle but receive benefits when injured in any and all their vehicles. See Barnett v. Crosby, 5 Kan. App. 2d 98, 612 P.2d 1250, rev. denied 228 Kan. 806 (1980). For example, in Merritt v. Farmers Ins. Co., 7 Kan. App. 2d 705, 647 P.2d 1355 (1982), the plaintiff was involved in a hit-and-run accident while a passenger in an automobile she owned but did not insure. Plaintiff was awarded uninsured motorist benefits as an additional insured under a policy issued to the driver. The court held that even though the legislature probably did not intend to require coverage for persons in plaintiff’s position, she was an “insured” under the policy language. 7 Kan. App. 2d at 711.
Following the passage of 40-284(e), the Court of Appeals stated:
“By adopting K.S.A. 40-284(e)(l), the legislature prevented the results reached in cases such as Barnett and Merritt. It is important to note, however, that the éxclusion authorized by the statute is a narrow one. It applies only to uninsured vehicles. The legislature’s intent in drafting such a narrow exclusion was apparently limited to preventing persons who failed to insure their own vehicles from recovering on the policies of others or on policies of their own issued for other vehicles.” Farmers Ins. Co. v. Gilbert, 14 Kan. App. 2d at 404.
Midwestern argues the district court, by finding Ashley is not excluded from coverage, is applying pre-1981 law — the law 40-284(e)(1) was created to eliminate. Midwestern further contends the legislature chose to allow the exclusion to extend to “insureds” and did not limit it to the “named insured.” Therefore, Ashley’s status as an insured places her in the class sought to be excluded by the legislature as expressed by 40-284(e)(l).
Midwestern also contends Ashley cannot have greater rights under the policy than Stephanie as the named insured. In Klamm v. Carter, 11 Kan. App. 2d 574, 730 P.2d 1099 (1986), the plaintiff had insurance on his automobile that included uninsured motorist coverage. He was injured by a negligent, uninsured motorist while plaintiff rode his own uninsured motorcycle. When plaintiff sought uninsured motorist benefits under his automobile policy, the Court of Appeals found the plaintiff was excluded from coverage pursuant to the policy’s exclusion clause. Moreover, the appellate court found the exclusion did not exceed the scope of K.S.A. 40-284(e)(l).
It is clear Stephanie cannot claim uninsured motorist benefits and Midwestern intended to exclude Ashley as well. Midwestern points out the general rule is that the rights of the additional insureds can rise no higher than the named insureds. The general rule, however, is subject to statutes and public policy provisions to the contrary. 12 Couch on Insurance 2d § 45:307 (rev. ed. 1981). Thus, the question of whether K.S.A. 40-284(e)(l) or Kansas public policy forbids Ashley’s exclusion would remain.
Ball counters Midwestern’s arguments by pointing out the narrow construction given K.S.A. 40-284. Moreover, Ashley, an unemancipated minor, may sue Stephanie to recover damages for injuries caused by Stephanie’s negligence in the operation of a motor vehicle. See Nocktonick v. Nocktonick, 227 Kan. 758, 611 P.2d 135 (1980). Ball also claims that by denying Ashley uninsured motorist benefits because she is a family member, Midwestern is attempting to impose a household exclusion prohibited under Kansas law. For support of the household exclusion prohibition argument, Ball cites DeWitt v. Young, 229 Kan. 474, 625 P.2d 478 (1981), in which this court found household and garage shop exclusions, or any other exclusion, to motor vehicle liability insurance coverage could not exceed the exclusions allowed by law.
Household exclusions in contravention of statutorily mandated liability insurance were found void because they violated public policy. DeWitt v. Young, 229 Kan. at 479. The exclusions and limitations of K.S.A. 40-284(e) are also expressions of public policy, but in the context of uninsured motorist insurance. We find K.S.A. 40-248(e) does not violate the public policy which caused household exclusions to be void.
Midwestern contends the district court misinterpreted the phrase “provided for the insured’s regular use.” Midwestern argues that a person can use a vehicle without driving or owning it and that Ashley could use the Chevette by occupying it. In the context of motor vehicle insurance, this court has defined “use” very broadly as including “to occupy.” Alliance Mutual Casualty Co. v. Boston Insurance Co., 196 Kan. 323, 327-28, 411 P.2d 616 (1966); Esfeld Trucking, Inc. v. Metropolitan Insurance Co. 193 Kan. 7, 10-11, 392 P.2d 107 (1964). In addition, Midwestern claims the fact that Ashley had not ridden in the Chevette often should not influence the outcome of this case. Instead, the pertinent facts should be that the Chevette was owned by a family member and was available for Ashley’s regular use.
Ball argues that in order to exclude Ashley from coverage she must be the owner of the Chevette. Moreover, he contends Midwestern’s claim that the vehicle merely had to be “available” for her use impermissibly broadens the language of K.S.A. 40-284(e)(1).
We hold K.S.A. 40-284(e)(l) authorizes the exclusions enumerated in Midwestern’s policy with regard to uninsured motorist coverage. The question then presented is whether Ashley Ball falls within the exclusion. Much is made of whether the Chevette was furnished or available for the regular use of any family member. Obviously it was, as is illustrated by Ashley and her mother using it on the date of the accident. It was owned by Joseph and Stephanie Ball for family use when needed. Whether or not it was used regularly is immaterial; it was available for regular use. Any attempt to distinguish the statutory word “provided” from the insurance policy terms “furnished or available” is futile. The terms mean the same thing.
We are compelled by the clear, unambiguous language of the statute and the insurance policy to conclude that Ashley Ball is excluded from uninsured motorist coverage under the insurance policy on the Nova. To hold otherwise would not only violate the clear meaning of the statute but also, as a matter of public policy, encourage the public to insure only one vehicle.
The judgment of the district court is reversed, and judgment is entered for Midwestern Insurance Company.
Abbott, J., not participating.
Paul E. Miller, district judge, assigned. | [
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The opinion of the court was delivered by
Herd, J.:
In this criminal action Lester B. Dean was charged with aggravated robbery, K.S.A. 21-3427, for ordering gasoline pumped into his car, which he refused to pay for; he then threatened the gas station owner and drove away. Before trial, Dean moved to dismiss the charge on the theory his acts did not constitute aggravated robbery. The district court granted Dean’s motion.
On January 2, 1991, Chong Su Kwon, the owner of the Shawnee Conoco station in Shawnee was working alone when a small red vehicle pulled into his station. The driver ordered three dollars worth of gasoline. Kwon proceeded to pump the gasoline as ordered. Once he had complied with the order, Kwon returned to the driver’s window and requested payment of the three dollars. The driver responded by saying, “I don’t have money. How about this.” As he spoke the driver raised his right arm underneath a jacket as if he had a weapon. Kwon believed the driver was pointing a gun at him. He thought he was about to be shot. Kwon jumped away from the car. The driver then pulled out of the station and drove away.
Kwon immediately reported the incident to the police. Dean was stopped by the police a short time later for exceeding the speed limit in a school zone. Kwon identified Dean as the driver of the small red vehicle. No weapon was recovered from Dean or his vehicle.
Following a preliminary hearing, Dean moved to have the charge dismissed. He argued the facts did not support a charge of robbery and, therefore, could not sustain a charge of aggravated robbery. The district court agreed with Dean and dismissed the case. The State appeals.
The sole issue is whether Dean’s ordering the pumping of gasoline prior to payment and immediately leaving the presence of the owner without payment by the use of threat or force constitutes robbery or merely theft.
Dean was charged with aggravated robbery, which is: “a robbery committed by a person who is armed with a dangerous weapon or who inflicts bodily harm upon any person in the course of such robbery.” K.S.A. 21-3427. Robbery is statutorily defined as “the taking of property from the person or presence of another by threat of bodily harm to his person or the person of another or by force.” K.S.A. 21-3426.
As early as 1894, this court addressed the question of when the force or threat must occur in order to constitute the crime of robbery rather than theft. In State v. Miller, 53 Kan. 324, Syl. ¶ 1, 36 Pac. 751 (1894), we stated:
“To constitute the crime of robbery by forcibly taking money from the person of its owner, it is not necessary that violence to the person of the owner should precede the taking of the money; it is sufficient if it be contemporaneous with the taking.”
In keeping with Miller, Kansas follows the general rule:
“[T]o constitute the crime of robbery by forcibly taking [property] from the person of its owner, it is necessary that the violence to the owner must either precede or be contemporaneous with the taking of the property and robbery is not committed where the thief has gained peaceable possession of the property and uses no violence except to resist arrest or to effect his escape.” State v. Aldershof, 220 Kan. 798, 803, 556 P.2d 371 (1976).
The ultimate issue, therefore, becomes whether “the taking of the property has been completed at the time the force or threat is used by the defendant.” Aldershof, 220 Kan. at 803.
In Aldershof, the defendant while inside a tavern took two purses, one from a table and the other from the owner’s lap. He then escaped the tavern as he was being followed by the owner of one of the purses. The owner caught the defendant outside the tavern and grabbed his shirt. He turned, struck her, and left. The defendant was convicted of robbery and appealed.
The defendant contended the evidence did not support the jury’s verdict of robbery. Instead, he argued no force or threat was used in the taking of the purses. We agreed. The purses were under the defendant’s control when he left the tavern and were no longer in the victims’ presence. Thus, the taking was completed before he used any threat or force. The force used was to aid in his escape. 220 Kan. at 799-804.
We faced the same issue in State v. Long, 234 Kan. 580, 675 P.2d 832 (1984), overruled on other grounds State v. Keeler, 238 Kan. 356, 710 P.2d 1279 (1985), with a different result. The victim, Mrs. Wolf, operated a dairy farm that included a small sale building. Customers were allowed to help themselves to milk and then were on the honor system to deposit payment in a locked, slotted money box mounted on the wall. Mrs. Wolf discovered the defendant crouched over the money box, which had been pried open. The defendant had his hands in his pockets. Mrs. Wolf noticed a dollar bill lying on the floor beneath the money box. She attempted to block the defendant’s exit from the building, but he forced his way out of the building by violently shoving Mrs. Wolf aside. 234 Kan. at 581.
After being convicted of robbery, the defendant appealed, claiming the force used against Mrs. Wolf occurred after the taking to aid his escape and, therefore, the evidence did not support a robbery conviction. We determined “[t]he defendant takes possession of the property of another when he exercises dominion and control over the property.” 234 Kan. at 582-85. We further explained: “’If the possession of the would-be taker is imperfect in any degree, or his control of the thing desired is qualified by any circumstance, however slight, the taking is incomplete and the act is only an attempt.’ ” 234 Kan. at 585 (quoting 52A C.J.S, Larceny § 6).
We concluded a thief does not obtain complete independent and absolute possession and control of property adverse to the rights of the owner when the taking is immediately resisted by the owner before the thief can remove it from the premises or from the owner’s presence.
In the case currently under consideration, the State contends the facts are analogous to Long. The State claims that although Kwon voluntarily pumped gasoline into the vehicle, Dean could not exercise complete control and dominion over the gasoline until Dean threatened Kwon with what appeared to be a weapon to take the property from the presence of Kwon; thus, the taking was incomplete until force was used.
We agree. The statute requires the taking of property “from the person or presence of another” by use of force or threat. K.S.A. 21-3426. We believe the rules set out in Long apply here. Dean had not left the premises or even attempted to drive away. Here, Dean’s own actions of threatening Kwon before driving away indicate his belief that he needed to neutralize Kwon before he would have complete control of the gasoline. We find Dean made his threat to prevent resistance to the taking and not as a means of escape. Therefore, the facts support a charge of aggravated robbery.
The judgment of the trial court is reversed and the case is remanded for further proceedings consistent with this opinion. | [
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The opinion of the court was delivered by
Herd, J.:
Dr. Frank P. Kosik (Dr. Kosik) brought this action for breach of contract and violation of his procedural due process rights against his employer, Cloud County Community College (CCCC), after the CCCC Board of Trustees decided to nonrenew Dr. Kosik’s contract. Following a trial to a jury resulting in an award of damages to Dr. Kosik CCCC appeals, claiming numerous trial errors. Dr. Kosik cross-appeals.
FACTS
On August 1, 1983, Dr. Kosik entered into a series of one-year contracts to serve as the director of the Learning Resources Center (LRC), the library and audio-visual laboratory, at CCCC. Dr. Kosik’s contract was renewed annually up though the 1988-89 school year. All contracts signed each year by Dr. Kosik specified his status was that of Administrative Support Personnel. The administrative policies and procedures of CCCC provide administrators can be terminated or not renewed for any good cause.
Dr. Kosik was formally evaluated by the Dean of Instruction, Dr. James Douglass, on August 28, 1986. Dr. Douglass acknowledged Dr. Kosik’s expertise “in the library and in all technical phases.” Dr. Douglass, however, went on to state:
“Explanation: Even though I recommended contract in June, the board was hesitant and your renewal was on a split vote. Obviously they were responding to a collection of adverse comments over a period of time. Hopefully, comments are beginning to be favorable.”
In April 1987, 80 of the 600 students at CCCC signed a petition calling for a review of the appointment of Dr. Kosik to his position of director of the LRC. At the April 20, 1987, meeting of the CCCC Board of Trustees (Board), it was recommended that the administrative staff holding administrative and administrative support contracts be reappointed with the exception of Dr. Kosik. There followed a motion to develop and present to Dr. Kosik a list of directives for changes in his conduct. The next day Dr. Kosik received the list issued by the Board, which Dr. Kosik signed.
The issue of nonrenewal of Dr. Kosik’s contract came up on almost a yearly basis and was brought up by the Board. Leo Dreiling, Chairman of the Board, had been contacted personally by both students and parents of students with complaints about Dr. Kosik. Robert Champlin, a member of the Board at the time of Dr. Kosik’s contract nonrenewal, recalled receiving letters of complaint from faculty and students regarding Dr. Kosik.
In the spring of 1989, after receiving various complaints from faculty about Dr. Kosik and his strict enforcement of rules and abusive behavior, Dr. Douglass decided to recommend to the Board that Dr. Kosik’s contract be nonrenewed. Dr. Douglass did not discuss these complaints with Dr. Kosik. Dr. Douglass instead contacted David D. Swenson, legal counsel to the Board, and arranged for faculty members dissatisfied with Dr. Kosik’s job performance to meet with Swenson.
On April 21, 1989, Dr. Douglass wrote to Dr. Kosik indicating the intent of the Board was to nonrenew his contract. At that time, the Board had not expressed officially such an intent but had discussed nonrenewal in executive session prior to April 21, 1989. In the letter, Dr. Douglass invited Dr. Kosik to meet with him and Dr. James P. Ihrig, CCCC’s president, to discuss the matter.
Upon receiving the letter, Dr. Kosik hired legal counsel. Then, Dr. Kosik requested, through his attorneys, a meeting with Drs. Ihrig and Douglass to discuss renewal of his contract. The request was denied on the basis that attorneys are not allowed to participate in nonrenewal meetings between the Board and any administrator who has received notice of the Board’s intent to nonrenew.
Before the Board’s meeting on May 15, 1989, Swenson prepared a resolution declaring the Board’s intent to nonrenew Dr. Kosik’s contract. Swenson also prepared a list of reasons for non-renewal for good cause. At the meeting the Board voted to send Dr. Kosik notice of intent to nonrenew his contract for the 1989-90 academic year. Dr. Kosik received the notice by certified mail.
On May 22, 1989, Dr. Kosik wrote a letter to the Board discussing his disagreement with the contract renewal process and his desire to accept the invitation of the Board to meet with it to discuss the renewal or nonrenewal of his contract. Dr. Kosik requested the date of the meeting with the Board be moved back from the 10 days after the Board’s receipt of the meeting request as required by CCCC’s Administrative Personnel Policy No. 6 (AP 6), and the Board complied with his request.
On June 6, 1989, the Board held a special meeting to discuss renewal or nonrenewal of Dr. Kosik’s contract. The minutes from the special meeting reflect Dr. Kosik was in executive session with the Board for 55 minutes. At the beginning of the executive session with Dr. Kosik, the list of reasons for the nonrenewal of Dr. Kosik’s contract was both orally read and a written copy given to Dr. Kosik by Leo Dreiling, Chairman of the Board.
Dr. Kosik brought fellow employees Janine Johnson and Donna Parker to the meeting on June 6, 1989. They were both allowed to address the Board on his behalf.
On June 16, 1989, prior to the Board meeting, members of the Board took a tour of the LRC. At the meeting itself, the Board reconsidered its reasons for nonrenewal and voted to non-renew Dr. Kosik’s contract. The vote was four in favor, one abstaining, and one absent. Dan Farha, the Board member who abstained in voting for the nonrenewal, later testified he believed Dr. Kosik’s contract should not have been renewed. Board member Keith Christensen did not attend the June 16, 1989, meeting. He testified at trial, however, that after considering all the information presented by Dr. Kosik, Johnson, and Parker he believed it was in CCCC’s best interest to nonrenew the contract. Dr. Kosik was mailed notice of the nonrenewal on June 19, 1989.
At trial, Leo Dreiling testified he considered complaints he had heard prior to being elected to the Board in 1986, when voting at the June 16, 1989, meeting to nonrenew Dr. Kosik’s contract. Dreiling did not discuss these earlier complaints with the Board. Another Board member, Lloyd Erickson, testified he made his decision to vote to nonrenew Dr. Kosik’s contract prior to the June 6, 1989, meeting at which Dr. Kosik was advised of the reasons for nonrenewal. Robert Champlin seconded the motion to nonrenew Dr. Kosik’s contract and voted in favor of the motion despite the fact that Champlin did not attend the June 6, 1989, meeting and did not attempt to find out what information Dr. Kosik had presented at that meeting. Champlin, however, had the letter written by Dr. Kosik in which Kosik explained why his contract should be renewed.
Dr. Kosik then filed suit against CCCC, claiming breach of his employment contract; violation of his due process rights, including a claim for damages under 42 U.S.C. § 1983 (1988) and attorney fees pursuant to 42 U.S.C. § 1988 (1988); and breach of the CCCC “master contract,” an agreement entered into by the CCCC Board and the Faculty Association of CCCC.
Prior to trial both parties filed motions for summary judgment, which the trial court denied. At trial CCCC moved for a directed verdict at the close of Dr. Kosik’s case in chief and at the close of all the evidence. The trial court denied both motions.
Counsel for CCCC objected to various instructions submitted by the court, particularly the court’s failure to use CCCC’s proposed instruction No. 16 on due process requirements. During jury deliberations, the jury presented the court with a written question concerning whether damages could be awarded if the jury found no breach of contract. Over CCCC’s objection, the court gave an answer to the jury’s question.
The jury subsequently returned its verdict finding Dr. Kosik’s 1988-89 employment was not covered by the master contract. The jury also found the Board had good cause to nonrenew Dr. Kosik’s contract and, thus, did not breach his contract. The jury, however, did find CCCC violated Dr. Kosik’s procedural due process rights and awarded him $40,000 for lost wages and benefits and $25,000 for physical illness and emotional suffering. The jury did not award Dr. Kosik damages for future lost wages and benefits or for future physical illness and emotional suffering.
After the trial was concluded, the trial court denied CCCC’s motion for judgment notwithstanding the verdict and granted Dr. Kosik’s motion for reinstatement or, in lieu thereof, award of future lost wages and back pay and fringe benefits in the amount of $170,304.19 based on a due process violation. The trial court also granted Dr. Kosik’s request for attorney fees and expenses in the amount of $31,664.35 pursuant to 42 U.S.C. § 1988.
I
First, we address the issue of whether the trial court erred in denying CCCC’s motions for summary judgment, directed verdict, and judgment notwithstanding the verdict or, in the alternative, new trial. More specifically, the issue is whether thé trial court erred in not ruling as a matter of law that Dr. Kosik’s due process rights had not been violated.
To be entitled to due process Dr. Kosik must have a property interest in his continued employment with CCCC. State law rather than the United States Constitution must provide the source of this property interest. Cleveland Board of Education v. Loudermill, 470 U.S. 532, 538, 84 L. Ed. 2d 494, 105 S. Ct. 1487 (1985). Once the State has conferred a property interest, the property interest cannot be taken without constitutional, procedural due process. 470 U.S. at 541. In Kansas, a public employee who may be discharged only “for cause” has a property interest in continued employment. Gorham v. City of Kansas City, 225 Kan. 369, Syl. ¶ 1, 590 P.2d 1051 (1979). CCCC’s Administrative Personnel Policies provide “administrators may be terminated or not renewed for any good cause.” CCCC in its motion for summary judgment relied upon Burk v. Unified School Dist. No. 329, Wabaunsee Cty., 646 F. Supp. 1557 (D. Kan. 1986), and argued Dr. Kosik is of the same status as a nontenured teacher and could be nonrenewed for any reason or no reason. CCCC has not asserted this contention on appeal, but neither party spells out the source of Dr. Kosik’s right to due process. At oral argument, CCCC’s counsel stated there was no provision for Dr. Kosik to be “tenured” but Dr. Kosik thinks of himself as tenured. On appeal, the parties do not dispute that Dr. Kosik has a protected property interest. We so hold.
Unlike teacher termination cases and most cases involving administrators, this case is not governed by statute. K.S.A. 1991 Supp. 72-5439 governs the procedural due process requirements for terminating a teacher’s contract. The statutory provisions for nonrenewal of administrators’ contracts, K.S.A. 72-5451 et seq., (Administrators’ Act), do not apply to community colleges. Thus, the common-law rules and CCCC’s adopted rules of due process govern this action.
In Cleveland Board of Education v. Loudermill, 470 U.S. 532, the United States Supreme Court discussed due process requirements in terms of terminating public employees who had property interests in continued employment under applicable Ohio statutes. The Court stated: “An essential principle of due process is that a deprivation of life, liberty, or property ‘be preceded by notice and opportunity for hearing appropriate to the nature of the case.’” 470 U.S. at.542. Due process requires a balancing of competing interests. These competing interests include “the private interest in retaining employment, the governmental interest in the expeditious removal of unsatisfactory employees and the avoidance of administrative burdens, and the risk of an erroneous termination.” 470 U.S. at 542-43. The Court concluded by providing the following guidelines:
“The essential requirements of due process . . . are notice and an opportunity to respond. The opportunity to present reasons, either in person or in writing, why proposed action should not be taken is a fundamental due process requirement. [Citation omitted.] The tenured public employee is entitled, to oral or written notice of the charges against him, an explanation of the employer’s evidence, and an opportunity to present his side of the story. [Citations omitted.] To require more than this prior to termination would' intrude to an unwarranted extent on the government’s interest in quickly removing an unsatisfactory employee.” 470 U.S. at 546.
CCCC’s AP 6 outlines the process by which administrators’ contracts may be nonrenewed. It states:
“Administrators may be terminated or not renewed for- any good cause. Whenever an administrator is to be nonrenewed or terminated, he/she shall be notified in writing in the event of nonrenewal by June 30, of the year in which the contract is to expire. Whenever an administrator is given written notice of a Board’s intention to not renew or terminate the administrator’s contract, the administrator may request a meeting with the Board by filing a written request therefor with the clerk of the board within ten days from the date of receipt of the written statement of nonrenewal or termination of a contract. The Board shall hold such a meeting within ten days after the filing of the administrator’s request. The meeting provided for here shall be in executive session; and at such meeting, the Board shall specify the reason or reasons for the Board’s intention to not renew or terminate the administrator’s contract.
“The administrator shall be afforded an opportunity to respond to the Board. Neither party shall have the right to have counsel present. Within ten days after the meeting, the Board shall reconsider its reason or reasons for nonrenewal or termination and shall make a final decision as to the matter.”
Although the state’s Administrators’ Act does not control the actions taken by community colleges, AP 6 is modeled after K.S.A. 1991 Supp. 72-5452 and K.S.A. 72-5453. K.S.A. 1991 Supp. 72-5452 provides:
“Written notice of a board’s intention to not renew the contract of employment of an administrator shall be given to the administrator on or before April 10 of the year in which the term of the administrator’s existing contract expires. An administrator shall give written notice to the board on or before May 10 of the administrator’s rejection of renewal of the contract of employment. Terms of a contract may be changed at any time by mutual consent of both the administrator and the board.”
K.S.A. 72-5453 states:
“(a) Whenever an administrator is given written notice of a board’s intention to not renew the administrator’s contract, the administrator may request a meeting with the board by filing a written request therefor with the clerk of the board within 10 days from the date of receipt of the written statement of nonrenewal of a contract.
“(b) The board shall hold such meeting within 10 days after the filing of the administrator’s request. The meeting provided for under this section shall be held in executive section and, at such meeting, the board shall specify the reason or reasons for the board’s intention to not renew the administrator’s contract. The administrator shall be afforded an opportunity to respond to the board. Neither party shall have the right to have counsel present. Within 10 days after the meeting, the board shall reconsider its reason or reasons for nonrenewal and shall make a final decision as to the matter. ”
Chief Judge Earl E. O’Connor of the Kansas federal district court had the opportunity to consider the constitutionality of the procedure required by K.S.A. 72-5452 and 72-5453 in Peterson v. United School Dist. No. 418, 724 F. Supp. 829 (D. Kan. 1989). In Peterson, a former school principal brought an action challenging nonrenewal of his contract and claiming the school district had violated his civil rights under 42 U.S.C. § 1983. After considering constitutional principles, including those stated in Cleveland Board of Education v. Loudermill, Chief Judge O’Connor concluded the Administrators’ Act procedures were constitutional. Chief Judge O’Connor wrote:
“We are persuaded that the procedures provided in K.S.A. 72-5452 and K.S.A. 72-5453 sufficiently protect the property interests of school administrators. The requirement that the school board specify the reasons for its intent not to renew discourages unlawful or arbitrary actiqn. Since administrators not only have the opportunity to request a hearing but also the opportunity to respond to the reason provided for nonrenewal, we believe the process is fundamentally fair.” 724 F. Supp. at 834.
Although Peterson is not controlling upon this court, we find it persuasive and agree that the Administrators’ Act adequately protects administrators’ property interests. That being true, it follows that AP 6 protects Dr. Kosik’s property right. Let us now consider whether the Board complied with AP 6.
First, on May 15, 1989, Dr. Douglass presented to the Board information, memos, and notes from dissatisfied faculty members. Swensen, the Board’s attorney, also gave the Board information he had gathered by interviewing 6 to 8 faculty members on April 5, 1989. In addition, at least one Board member brought copies of letters of complaint he had received. After reviewing this information, the Board voted to send Dr. Kosik notice of intent to nonrenew his contract for the 1989-90 academic year.
On May 22, 1989, Dr. Kosik wrote the Board requesting an opportunity to meet with the Board. At Dr. Kosik’s request, the meeting was set for more than 10 days after receiving his request. Neither Dr. Kosik nor the Board had counsel present at this meeting held June 6, 1989. During executive session, Leo Dreiling read the following statement and list of reasons for nonrenewal to Dr. Kosik.
“Dr. Kosik, I am now furnishing you with a written list of the reasons upon which the Board made its decision to issue to you its written notice of intention not to renew your contract for the next school year. The reasons are as follows:
“1. Conduct demonstrating lack of proper professional and personal respect towards staff and students causing resentment and offense.
“2. Refusal to foster working relationships with college staff in an effort to enhance the overall learning atmosphere of the LRC and achieve harmony in the use of the LRC among students, staff and LRC personnel.
“3. Rigid and inappropriately harsh enforcement of LRC rules causing resentment among staff and students and unnecessary inaccessibility to needed materials and equipment.
“4. Public swearing and abusive conduct towards staff and students.
“5. Inappropriate and offensive conduct which has alienated a number of college faculty members to a point that they avoid the use of the LRC, giving student assignments requiring use of the LRC and any contact whatsoever by the faculty or students with Dr. Kosik.
“6. Inappropriate and offensive conduct towards students causing some students to be uncomfortable about or even to avoid using the LRC.
“7. Offensive and inappropriate conduct resulting in the underutilization of the LRC to the detriment of the college, its faculty and students.
“8. Termination of a support staff employee without the requisite administration approvals in violation of Board policies.
“9. Termination of support staff employee knowingly in direct contradiction of administration intentions and desires.
“You are entitled to have an opportunity to respond to the above charges. You may either make an oral response at this time, or you may make your response in writing before the Board meets to reconsider its reasons and your responses. The Board will meet on June 15, 1989, to reconsider its reasons for nonrenewal of your contract and to make a final decision as to the matter. You will be notified of the Board’s final decision within a few days thereafter.
“Would you like to make a statement of response at this time, or would you prefer to respond in writing to the reasons?”
Dr. Kosik then was given an opportunity to respond to the nine reasons. He took almost an hour for his presentation. Once Dr. Kosik concluded and left the executive session, two of his assistants from the LRC testified in fiis behalf to the Board. After the presentation the Board removed items 8 and 9 from the list of reasons for nonrenewal.
On June 9, 1989, Dr. Kosik fortified his testimony with a three-page letter to the Board president with copies to each Board member. The letter states in part: “My initial reaction to the ‘Reasons’ remains unchanged: they in no way constitute evidence and are merely tediously repetitious and totally unfounded malevolent fabrications and willful misrepresentations.”
Janine Johnson, one of the LRC staff faculty members, also wrote a letter to the Board after the June 6, 1989, meeting. The letter was supportive of Dr. Kosik.
Prior to the Board’s final decision on June 16, 1989, the Board took a tour of the LRC. Following the tour, the Board voted to nonrenew Dr. Kosik’s contract.
Essentially, Dr. Kosik’s objections to the due process afforded him center upon the methods and actions of the Board in conducting the hearing and making its decision.-He first complains that Board member Lloyd Erickson testified he had made his decision to nonrenew Dr. Kosik’s contract prior to the June 6, 1989 meeting. He also complains that Leo Dreiling considered complaints he had heard against Dr. Kosik prior to his being elected to the Board when Dreiling voted to nonrenew Kosik’s contract.
Issues similar to these raised by Dr. Kosik were considered by this court in Kelly v. Kansas City, Kansas Community College, 231 Kan. 751, 648 P.2d 225 (1982), in which we considered nonrenewal of tenured teachers. There, we stated: “Unless authorized by statute, an administrative body performing a quasi-judicial function is not subject to inquiry concerning its mental processes in reaching a decision.” 231 Kan. 751, Syl. ¶ 2.
Here, there is no statutory authorization for inquiring into the mental process of the board; thus, such inquiry is improper. We hold this argument to be meritless.
Lastly, Dr. Kosik argues the vote of the Board to nonrenew his contract was improper. Four of the six board members voted to nonrenew the contract. Dr. Kosik contends Board member Robert Champlin’s vote should not be counted because he did not attend the June 6 hearing. It is noted that Champlin was sent a copy of Dr. Kosik’s letter to Leo Dreiling in which he set forth his response to the Board’s reasons for his nonrenewal. Furthermore, Champlin attended the June 16, 1989, meeting where the Board discussed the issue of Kosik’s nonrenewal prior to voting.
A similar argument was made in Kelly. We held the risk of a wrongful deprivation of due process increases where board members neither attend the hearing nor read the entire record thereof but the risk is lessened where some members read the hearing record and the issues are thoroughly presented, argued, and discussed before a vote is taken. Kelly, 231 Kan. at 761. We hold the presumption of regularity of a Board’s action was not overcome by Dr. Kosik’s evidence, and thus due process requirements were satisfied.
We hold the procedure adopted by the Board does not violate due process. Dr. Kosik was afforded notice of nonrenewal. He was provided a list of reasons for nonrenewal and a hearing before the Board to attempt to refute those reasons orally and in writing. Moreover, Dr. Kosik was permitted to call witnesses in his behalf. The Board then met and reconsidered its intention to nonrenew and decided Dr. Kosik’s evidence did not persuade it to renew his contract. Because the Board properly followed its adopted due process procedure, we hold Dr. Kosik was afforded the due process required in this case.
The facts surrounding the procedure used by the Board in nonrenewing Dr. Kosik’s contract were not in dispute. Therefore, the legal question of whether due process was afforded should have been decided by the trial court as a matter of law. The trial court erred in denying CCCC’s motion for directed verdict on this issue at the close of Dr. Kosik’s case. At that time, the trial court had ample undisputed facts upon which to base its decision that the Board did not violate Dr. Kosik’s right to due process.
II
Dr. Kosik in his cross-appeal questions whether sufficient evidence supports the jury’s finding that CCCC had good cause to nonrenew his contract on June 16, 1989.
The duty of an appellate court when considering the sufficiency of the evidence is well established. We have stated:
“[T]he duty of the appellate court extends only to a search of the record for the purpose of determining whether there is any competent substantial evidence to support the findings. The appellate court will not weigh the evidence or pass upon the credibility of the witnesses. Under these circumstances, the reviewing court must review the evidence in the light most favorable to the party prevailing below.” Lambeth v. Levens, 237 Kan. 614, 622, 702 P.2d 320 (1985).
We have previously discussed much of the information the Board possessed on June 16, 1989, when it voted to nonrenew Dr. Kosik’s contract. This information was introduced at trial. It showed Dr. Douglass had presented memos and letters of complaint to the Board on May 15, 1989. At the same meeting David Swenson provided the Board with information he had gathered by interviewing six to eight faculty members. Several Board members testified they had received, complaints from students, parents, and faculty over a period of time. Keith Christensen brought photocopies of complaints he had received to the May 15, 1989, meeting.
After reviewing the evidence, we find substantial evidence to support the jury’s finding that good cause existed to nonrenew Dr. Kosik’s contract.
III
Dr. Kosik’s final issue on cross-appeal is whether, as a matter of law, good cause existed to nonrenew his contract.
Dr. Kosik claims the Board lacked good faith and acted irrationally when voting to nonrenew his contract and, therefore, the Board’s action can be ruled invalid as a matter of law. Dr. Kosik cites. Gillett v. U.S.D. No. 276, 227 Kan. 71, 605 P.2d 105 (1980), which involved the nonrenewal of a teacher’s contract. We held:
“[U]nder the Kansas due process statute (K.S.A. 1977 Supp. 72-5436 et seq.) a tenured teacher may be terminated or nonrenewed only if good cause is shown, including any ground which is put forward by the school board in good faith and which is not arbitrary, irrational, unreasonable, or irrelevant to the school board’s task of building up and maintaining an efficient school system.” 227 Kan. at 78.
We agree with the rule stated in Gillett, but disagree with Dr. Kosik’s portrayal of the Board’s actions. After a review of the evidence, we hold the Board acted in good faith. The issue of whether the Board had good cause to nonrenew Dr. Kosik’s contract was a question of fact determined by the jury.
IV
Our decision on the issue of due process makes all other issues moot. The jury verdict on breach of contract and the coverage of the master teacher contract of the CCCC were not appealed and, therefore, are not before this court and must stand. Because we have found the Board did not violate Dr. Kosik’s due process rights, coupled with the jury determination there was no breach of contract and that the master contract did not apply, there remains no basis upon which Dr. Kosik can be awarded relief.'
The judgment of the trial court is reversed on the due process issue. The awards of attorney , fees, damages, and other relief to Dr. Kosik are set aside. The judgment is affirmed on all other issues. | [
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The opinion of the court was delivered by
Allegrucci, J.:
Jerry Dye appealed his convictions by a jury of one count each of possession of cocaine, K.S.A. 1991 Supp. 65-4127a, possession of marijuana, K.S.A. 1991 Supp. 65- 4127b(a)(3), and possession of drug paraphernalia, K.S.A. 65-4152. The Court of Appeals found error in the admission of statements made by Dye and evidence found on him and reversed his convictions. We granted the State’s petition for review.
Dye raises three issues in this appeal. He states that the “primary issue ... is the validity of [the] search warrant. ” The other issues raised are a defect in the drug paraphernalia count of the complaint and counsel’s not being allowed to withdraw when he anticipated that he might become a witness.
In the Court of Appeals, the State conceded that the complaint was defective and that the conviction for the possession of drug paraphernalia should be overturned as a result. The Court of Appeals did not reach the third issue relating to defense counsel’s motion to withdraw.
The Court of Appeals found reversible error with regard to the admission of evidence, but not on the ground urged by Dye. Dye argued that the warrant was deficient in not naming him or specifically identifying his apartment. The Court of Appeals found error in the admission of money, cocaine, and statements taken from Dye and made by him at the time the search warrant was being executed. The conviction for possession of cocaine was reversed because it was based solely on the cocaine found on Dye and his statement that it was cocaine. As to the conviction for possession of marijuana, the court said:
“Although it is a closer question whether, without the evidence and statements resulting from Dye’s search, the jury would have found Dye guilty of possession of marijuana, we are not prepared to declare beyond a reasonable doubt that the error had little, if any, likelihood of having changed the result of the verdict on the possession of marijuana charge. We must reverse.”
On the suppression issue raised at trial, the lack of specific identification of Dye’s apartment, the parties agree on the following facts: Officer Blundell testified that there were two apartments and “another thing” which possibly could be considered an apartment at the rear of the Shorthorn Tavern building. The owner of the tavern testified that the building had two apartments plus a middle area which was used for storage. He also testified that at the time the search warrant was executed only Mr. Dye’s apartment was occupied. . . •
Blundell testified that he knew, and had known for four or five years, which apartment Dye lived in. Blundell variously indicated that the apartment was referred to as “apartment 2” and as the “back apartment.” The City of Chetopa’s utility records indicated that Dye lived in the “middle apartment at 102 North Sixth.” There were no apartment designations posted on the premises.
Blundell testified that he had known Dye for 20 years. He had seen Dye going in and out of the apartment many times over a period of several years. Blundell was the affiant, he was one of the officers who searched Dye’s apartment, and he informed the other officers which apartment was to be searched, although they also knew which apartment Dye occupied.
In the present case, the place to be searched was described in the warrant as “[t]he residence of 102 N. 6th Street in Chetopa, KS, an apartment in the rear of the Shorthorn Tavern.” The description of the premises in the affidavit was as follows: “In the past two months, two purchases of marijuana have been made on Fridays from Jerry Dye at his residence, an apartment located at 102 N. 6th, in Chetopa Kansas.”
The issue which was focused on in the district court and by the parties in their briefs in the Court of Appeals was whether the lack of specificity in identifying Dye’s apartment in the warrant invalidated the search. Dye argued that the evidence should have been suppressed because the officers knew of the multiunit character of the structure, but failed to conduct an investigation to obtain the specific designation of his apartment.
The State argued that any irregularity in the warrant was merely technical because Officer Blundell, the affiant and one of the executing officers, knew with certainty which apartment was occupied by Dye. The State also argued that, because there was no number on the apartment door and it was known by various designations, using an apartment number in the warrant would not have improved the specificity of the description. Furthermore, because Dye’s apartment was the only one in which someone was living, the lack of specificity did not provide a “roving commission” for the police.
In State v. Gordon, 221 Kan. 253, 258, 559 P.2d 312 (1977), we found that “[i]t is constitutionally required that a search warrant shall ‘particularly’ describe the place to be searched.” We held: “A search warrant directed against a multiple occupancy structure generally will be held invalid if it fails to describe the particular room or subunit to be searched with sufficient definiteness to preclude a search of other units.” 221 Kan. 253, Syl. ¶ 7.
We noted that a few courts had carved out exceptions to the rule that a search warrant lacking sufficient definiteness as to a subunit will be held invalid. With regard to these exceptions, this court found that “none of them, even if recognized, is applicable” in the circumstances of Gordon. 221 Kan. at 259.
Following the general rule as stated in Gordon, the Court of Appeals found the search warrant deficient but an exception to the rule was said to save the warrant in this case. It “provides that a slight ‘deficiency in the warrant may be cured by a proper description in the supporting affidavit, although it is usually required that the affidavit be annexed or attached to the warrant.’ 221 Kan. at 259.” The Court of Appeals reasoned that the deficiency in the warrant is cured by the more specific description in the affidavit, even though there is nothing in the record to show that the affidavit was attached to the warrant, because the affiant also was an executing officer.
The Court of Appeals did not discuss or elaborate on its conclusion that the affidavit cured the defective description in the search warrant. The only additional fact relative to the description of the place to be searched was that it was the defendant’s apartment. In Thomas v. State, 50 Md. App. 286, 437 A.2d 678 (1981), a similar question was before the court. There as here, the search warrant gave the correct street address of the apartment building but did not specify the apartment to be searched except that it was the defendant’s apartment. The court upheld the validity of the search warrant, stating:
“The officers knew which building to enter because of the notation on the front of the search warrant. They knew which apartment to search because of the information in the attached affidavit in support of the warrant. This affidavit does not state the number of the apartment to be searched, but it adequately identifies the apartment by providing the name of the resident, Randolph Thomas, the appellant.” 50 Md. App. at 293.
In State v. Kyles, 513 So. 2d 265 (La. 1987), both .the affidavit and the search warrant gave the correct street number of the defendant’s residence but did not indicate that there was more than one apartment at that address. The informant pointed out which apartment was the defendant’s, and the officers waited until the defendant exited the apartment before they executed the search warrant. The court said: “Under these circumstances, there was little probability that the wrong place would be searched, and there was no violation of the particularity requirement.” 513 So. 2d at 270.
In United States v. Clement, 747 F.2d 460 (8th Cir. 1984), the search warrant described the premises to be searched as “ ‘apartment of Vance Clements, No. 4 at 3300 Irvine Avenue.’ ” 747 F.2d at 461. The officers executing the warrant searched Apartment No. 3, which was the defendant’s apartment. The court upheld the search warrant, stating:
“The test for determining the sufficiency of a warrant description is ‘whether the place to be searched is described with sufficient particularity as to enable the executing officer to locate and identify the premises with reasonable effort, and whether there is any reasonable probability that another premise might be mistakenly searched.’ United States v. Gitcho, 601 F.2d 369, 371 (8th Cir.), cert. denied 444 U.S. 871, 100 S. Ct. 148, 62 L. Ed. 2d 96 (1979). Among the factors we have relied upon in upholding searches conducted under the authority of a warrant inaccurately describing the place to be searched are: (1) whether the address in the warrant, although incorrect, still describes the same piece of property; (2) whether the premises intended to be searched are adjacent to those described and are all under the control of the defendant; and (3) whether other parts of the description which are correct limit the place to be searched to one place. Id. Of particular importance in Gitcho was the fact that the agents personally knew which premises were intended to be searched. Id. at 372.
“In the instant case, the search warrant named the correct street number. Officer Doyle testified that he had been to the apartment building several times before and knew where Clement’s apartment was located. In fact, the day before the warrant was issued, Officer Doyle had talked with Grotberg and Clement separately in their respective apartments. Clement’s apartment was adjacent to Grotberg’s, and the warrant specifically named his residence. When the officers arrived to execute the warrant, they immediately went to Clement’s apartment. Under these facts, there was no probability of a mistaken search, and we cannot conclude that the inaccurate address in the warrant should operate to invalidate the search.” 747 F.2d at 461.
In State v. DeLaurier, 533 A.2d 1167 (R.I. 1987), the Supreme Court of Rhode Island noted that a description is adequate if the officer executing the search warrant can with reasonable effort ascertain the place to searched with certainty. The court held that the description of defendant’s home in the warrant was specific enough to indicate to officers the proper scope of their search, where the warrant cited the proper address, referred to the home as a duplex, and authorized officers to search and seize at the home of defendant. 533 A.2d at 1171.
In the present case, we agree that the search warrant was not fatally defective when it is read together with the affidavit. The Court of Appeals went a step beyond our discussion in Gordon and said that this court “recognized three exceptions to the general rule.” The one said to apply in the present case is “where the deficiency in the warrant may be cured by a proper description in the supporting affidavit, although it is usually required that the affidavit be annexed or attached to the warrant.” 221 Kan. at 259.
It is indicated in cases applying this exception that the usual requirement that the affidavit be attached to the warrant is practical rather than technical. If the executing officers actually have more information pinpointing the location to be searched than appears on the face of the warrant, a search of other units may be avoided. As one court phrased it, “[i]f the affidavit required for the issuance of the warrant is attached to the warrant and incorporated therein by reference, it can be used by the officer to identify the place intended.” United States v. Moore, 263 A.2d 652, 653 (D.C. 1970).
Colorado courts have had occasion to consider whether information in the affidavit satisfies the warrant particularity requirement. One case involved circumstances very similar to the present one. The Colorado Court of Appeals used the following rationale for upholding the trial court’s refusal to suppress evidence seized pursuant to a search warrant which listed only a street address, although “there were at least two apartments at the location”:
“Ordinarily a search warrant for a multi-unit structure which does not specify a particular subunit is constitutionally defective. [Citation omitted.] However, here the affidavit for the warrant specified that only the single apartment located in the upstairs portion of the building was that for which the warrant was desired. The warrant was thereafter executed by the officer who procured its issuance. Thus, since the affidavit contains sufficiently specific information to uphold issuance, evidence obtained in the resulting search need not be suppressed simply because the warrant contains only a general description of the place to be searched. [Citations omitted.]” People v. Salazar, 39 Colo. App. 409, 410-11, 568 P.2d 101 (1977).
In a subsequent case the Colorado Court of Appeals squarely faced the question whether a deficiency in the warrant could be cured by an unattached affidavit, and the court answered that it could be. People v. Papez, 652 P.2d 619 (Colo. App. 1982). The alleged deficiency was a lack of specificity in the items to be searched for rather than the location, but the court treated the constitutional particularity requirement as equally applicable to each and employed the same reasoning for each.
The affidavit contained “sufficiently specific information to satisfy any constitutional particularity requirement.” 652 P.2d at 622. The warrant referred to property stolen from an office in general terms. Because the affiant and the executing officer were the same person, “there was no occasion for concern that the officer would be misled by the description in the warrant.” 652 P.2d at 622.
The court stated that there was no statutory or constitutional requirement that the affidavit be attached to the warrant, and concluded:
“Under the circumstances of this case, it would be putting form over substance to apply the exclusionary rule merely because the officer executing the warrant may not have had a copy of the affidavit in his possession when he searched the home or because a copy of the affidavit may not have been furnished to, or attached to, the copy of the warrant given the person whose home was searched. This we decline to do.” 652 P.2d at 622.
In U. S. v. Gahagan, 865 F.2d 1490 (6th Cir. 1989), the challenge to the search warrant was that the description was defective in that it did not particularly describe the place to be searched. The warrant gave only a street address. The supporting affidavit gave a complete address. Since the description in the affidavit was sufficient, the court found it cured the defect in the warrant, notwithstanding that the affidavit was not attached to the search warrant. The court noted it was in the officer’s vehicle and accessible to the officer at the time of the search. The court said:
“Against the backdrop of the cited case law, we find that the description of the property to be searched contained in the affidavit, as well as the relevant information known by the executing officer in this case, can be relied upon to validate a warrant if the description contained in the warrant itself is less than complete. Here, there is no dispute that probable cause existed to search 7609 Douglas Lake Road, the place listed in the warrant. Further, there is no dispute that the officer knew that the search was for Cabin #3 and House B. The officers supplied the court with the description contained in the affidavit and therefore could reasonably ascertain both Cabin #3 and House B.
“Consequently, we find that when one of the executing officers is the affiant who describes the property to the judge, and the judge finds probable cause to search the property as described by the affiant, and the search is confined to the areas which the affiant described, then the search, in this case, is in compliance with the fourth amendment.” 865 F.2d at 1498-99.
In the recent case of State v. LeFort, 248 Kan. 332, 806 P.2d 986 (1991), we relied on Gahagan in determining a similar challenge in favor of the State. In LeFort, the officer prepared the application and affidavit, which was part of a multi-sheet form. The carbon inserts were not long enough, and the complete description of the residence did not copy onto the search warrant. The officer who executed the affidavit participated in the search. We upheld the validity of the search warrant, stating:
“In determining whether the description given the executing officer in the warrant was sufficient, the initial examination is directed to the description stated in the warrant. However, if the description in the warrant is inadequate due to technical irregularity, the focus then shifts to the description contained in the application or affidavit for the warrant if the officers were able to use that description to execute the search warrant. When the officer executing the search warrant is the affiant who described the property to be searched, and the judge finds there was probable cause to search the property described by the affiant and the search is confined to the area which the affiant described in the affidavit, the search does not affect the substantial rights of the accused and is in compliance with the Fourth Amendment of the Constitution of th,e United States and Section Fifteen of the Kansas Bill of Rights.
“The fact that the complete address of the particular place to be searched failed to be copied through the carbon in the warrant was a mere oversight, a technical irregularity, which did not prejudice the defendant.” 248 Kan. at 341.
Although in the present case lack of a sufficient description in the search warrant was not due to a “mere oversight,” the effect was the same. There is no indication in LeFort that the affidavit was attached to or accessible to the officers. As in LeFort, the ■éxecuting officer was the affiant, the issuing judge found probable cause to search the defendant’s residence, and the search was confined to that residence.
There were two apartments at 102 N. 6th Street in the rear of the Shorthorn Tavern building. One was occupied by Dye and had been for several years; the other was unoccupied. The warrant does not specify whether the targeted apartment was occupied, but the affidavit refers repeatedly to Dye and his “residence.” Thus, the information in the affidavit was sufficient to preclude intrusion into the other, unoccupied apartment.
Because the affiant, Blundell, also participated in the execution of the search warrant, the information which precluded a search of the other apartment was available at the scene of the search whether or not the affidavit was attached to the warrant. He knew with certainty which unit Dye lived in, he directed the other officers to the correct unit, and his direction was superfluous in that the other officers were familiar with which unit was involved. It was clear, therefore, to all the officers that the warrant did not authorize a search of thé other, unoccupied apartment but rather was limited to the premises occupied by Dye.
This court has stated the purpose of the particularity requirement as being “to prevent general searches and to prevent the
seizure of an item at the discretion of the officer. Stanford v. Texas, 379 U.S. 476, 13 L. Ed. 2d 431, 85 S. Ct. 506.” State v. Ames, 222 Kan. 88, 92, 563 P.2d 1034 (1977). The test is for “practical accuracy,” and common sense should prevail over hypertechnicality. 222 Kan. at 92. We conclude the search warrant was not fatally defective when it is read together with the affidavit and one of the officers executing the search warrant is the affiant.
The Court of Appeals, however, did not invalidate the warrant for lack of specific identification of the location. Instead, it found a fatal deficiency in the warrant in the failure to state Dye’s name. The warrant directed the search against “[a]ny . . . persons on the property.” The Court of Appeals examined the facts set forth in the affidavit and concluded that they were insufficient to justify searching all persons present in the apartment.
It appears that the Court of Appeals believed that the authority for searching Dye depended on the search warrant. In the opinion it is stated that “[ajfter entering Dye’s apartment, police searched Dye and found money and a plastic bag with cocaine and a vial. Dye was arrested and made incriminating statements to police.”
In its petition for review the State asserts that the Court of Appeals incorrectly interpreted the facts and should have remanded the case for a factual determination as to the timing and circumstances of the arrest. The necessary factual determination can be made without remanding. In its petition for review the State quoted testimony from the suppression hearing; it has not been controverted by Dye. That testimony establishes that the search of the apartment was underway and that marijuana plants had been found before Dye was placed under arrest. After he was arrested, the search of Dye yielded money and cocaine, and he made incriminating statements to the police. The State argues that the search was incident to a valid arrest and that this issue was never briefed or argued by counsel.
Dye filed a response to the State’s petition for review. He asserted that the issue had been briefed and argued. He evidently relied on a few fleeting references to his name not being on the warrant, which actually were made in the context of the identification of the apartment. Nevertheless, Dye did not contest the State’s- assertion that he was arrested and searched after marijuana was found in his apartment. Dye also argues that his expectation of privacy was violated irrespective of the timing of the search. He relies on State v. Lambert, 238 Kan. 444, 710 P.2d 693 (1985), and State v. Horn, 15 Kan. App. 2d 365, 808 P.2d 438, rev. denied 248 Kan. 998 (1991).
The Court of Appeals, believing that the warrant governed the arrest, analyzed case law on warrants authorizing the search of all persons present on the premises to be searched. The Court of Appeals relied on Lambert, State v. Platten, 225 Kan. 764, 594 P.2d 201 (1979), and cases from other jurisdictions.
In Lambert, this court considered the search of a nonresident during the execution of a warrant which authorized the search of an apartment and its occupant. The nonresident was seated at the kitchen table when police entered the apartment. There was marijuana on the table. The nonresident was placed under arrest for possession of marijuana, and her purse was searched. She was prosecuted on the basis of methamphetamine found in her purse. This court concluded that the trial court correctly determined that the evidence must be suppressed pursuant to Ybarra v. Illinois, 444 U.S. 85, 62 L. Ed. 2d 238, 100 S. Ct. 338 (1979).
There is no discussion in Lambert of a search incident to a valid arrest. In all likelihood, the State did not make this argument because the nonresident’s being seated at a table on which there was some marijuana would be a shaky foundation for an arrest for possession of the substance. This court did observe:
“Under proper circumstances the police may search a nonresident visitor or his belongings in the course of executing a warrant for a premises search. These circumstances include: where the individual consents to being searched, where the item is in plain view on the person or in his possession, where there has been a valid arrest and where there is probable cause to search plus exigent circumstances.” (Emphasis added.) 238 Kan. at 450.
Lambert is of little use here because Dye’s arrest was not made pursuant to the warrant. Although one may reasonably assume that, if the police may search a nonresident visitor where there has been a valid arrest, they may search the occupant of the premises who has been validly arrested. Hence, a determination that the arrest of Dye was valid based upon the discovery of marijuana in his apartment would affirmatively answer the question whether the search of his person was constitutionally permissible.
In Ker v. California, 374 U.S. 23, 10 L. Ed. 2d 726, 83 S. Ct. 1623 (1963), police officers went to George Ker’s apartment without a warrant in order to arrest him for drug activities. Police knew that he was using the apartment for narcotics transactions. His wife, Diane Ker, emerged from the kitchen when the police entered with a pass key. In plain view in the kitchen was a brick-shaped package of marijuana on a scale. The Supreme Court ruled that the discovery of the marijuana in plain view was sufficient ground for a reasonable belief that Diane was committing in the presence of the officers the offense of possession of marijuana. Thus, there was probable cause to arrest her once the marijuana had been discovered, even though there had not been probable cause to arrest her at the time the officers entered the apartment.
This court embraces the general rule that an officer does not need a warrant to make an arrest if he or she has reasonable cause to suspect that an offense has been committed. State v. Peterson, 236 Kan. 821, 826, 696 P.2d 387 (1985). An arrest which takes place within a suspect’s own home, however, is subjected to somewhat closer scrutiny than one which occurs elsewhere, at least in some circumstances. In State v. Platten, it was stated that “[t]he Fourth Amendment and Section 15 of the Kansas Constitution Bill of Rights require an arrest warrant based upon probable cause to validly arrest a person within his own home unless exigent circumstances exist.” 225 Kan. 764, Syl. ¶ 5. Arrest in one’s own home was contrasted with arrest in a public place, where a warrant is not necessary as long as there is probable cause.
Platten’s home was forcibly entered for the purpose of arresting him without a warrant, and it seems that that factor weighed heavily in this court’s decision. Emphasis was placed on the “unique sensitivity” to which one’s reasonable expectation of privacy in the home is entitled, and Justice Stewart’s opinion in Coolidge v. New Hampshire, 403 U.S. 443, 29 L. Ed. 2d 564, 91 S. Ct. 2022 (1971), was quoted for the proposition that warrantless entry of a person’s house in order to arrest him is in fundamental conflict with the protections of the Fourth Amendment. 225 Kan. at 768-69.
This case is distinguishable from Platten on the ground that the initial entry into Dye’s apartment was lawful and was not for the purpose of arresting him without a warrant. This case is more analogous to Ker v. California than to Coolidge v. New Hampshire.
The validity of the arrest of Dye would be, as in Ker, whether there was probable cause to support the arrest. Did discovery of the marijuana plants in Dye’s apartment during the execution of a search warrant for drugs supply probable cause to arrest him? We believe it did.
K.S.A. 22-2401 provides in pertinent part:
“A law enforcement officer may arrest a person under any of the following circumstances:
“(c) The officer has probable cause to believe that the person is committing or has committed:
“(1) A felony; or
“(2) a misdemeanor, and the law enforcement officer has probable cause to believe that:
“(A) The person will not be apprehended or evidence of the crime will be irretrievably lost unless the person is immediately arrested.
“(d) Any crime, except a traffic infraction, has been or is being committed by the person in the officer’s view.”
In State v. Peterson, the term “probable cause” in the statute is defined as “refer[ing] to that quantum of evidence which would lead a prudent man to believe that an offense has been committed.” 236 Kan. at 826. It also was said that the “correct test is whether a warrant if sought could have been obtained by the arresting officer.” 236 Kan. at 827. There is little doubt that a judicial officer presented with the facts set forth in the affidavit concerning Dye’s transporting, receiving, packaging, and selling marijuana plus the discovery of marijuana plants in Dye’s apartment would not have issued a warrant for his arrest for violation of K.S.A. 1991 Supp. 65-4127b(a)(3), possession of a controlled substance.
Because violation of 65-4127b(a)(3) can be either a felony or a misdemeanor, several subsections of the statute governing warrantless arrest need to be consulted. The arrest would be valid under any of the statutory subsections quoted earlier.
The arrest being valid, we next consider whether the search of Dye’s person was lawful. It is entirely reasonable for an arresting officer to search for and seize any evidence on the arrestee’s person in order to prevent its concealment or destruction. Chimel v. California, 395 U.S. 752, 763, 23 L. Ed. 2d 685, 89 S. Ct. 2034 (1969). This court has stated that it is not only the officer’s right, but also a duty as an incident to the arrest, to search the person arrested and seize incriminating items. State v. Little, 201 Kan. 94, 96, 439 P.2d 387 (1968). Thus, if the arrest was constitutionally permissible, the search incident to it was permissible as well.
The Court of Appeals ruled that Dye’s statement identifying the white powder which was found on him as cocaine, as well as the cocaine and money found on him, should have been suppressed. The opinion contains no separate analysis of the admissibility of the incriminating statement.
In the district court, Dye filed a motion to suppress the statement made at the time of the search and a statement made to another officer a few days later. The grounds for the suppression were that he requested an attorney, was not taken before a magistrate in a timely manner, and was not advised of his constitutional rights. The motion was overruled by the district court and not renewed when Dye appealed his convictions to the Court of Appeals.
Thus, since the arrest of Dye was valid, there is no issue before this court as to the admissibility of Dye’s statements.
The final issue is whether the district court erred in refusing to allow defense counsel to withdraw in order to testify that there was a discrepancy between his count and a police officer’s count of money seized from Dye. This issue was not considered by the Court of Appeals. Dye argued that counsel should have been permitted to withdraw during trial when Officer Blundell testified that the bag of money found on Dye contained $1,020.60. Defense counsel, at the time of the preliminary hearing, had counted $1,260.60. Dye contends that this discrepancy is material in that it “had a direct bearing on both the officers’ credibility and the chain of custody over the evidence which was seized.”
The State contends that its witnesses consistently testified that $1,020.60 was recovered from Dye and that the bag contained that amount at the preliminary hearing and at trial. If there were a basis for casting doubt on the officers’ credibility and the chain of custody, defense counsel should have raised the issue at the preliminary hearing.
The sheriff testified at the preliminary hearing that he had received $1,020.60 from Officer Blundell and kept it in his custody. Defense counsel asked him whether it was a “crime to possess $1,260.00 in currency.” The State asserts that this reference to a different amount is “the last word that is in the record pertaining to the issue until the trial.”
On the eve of trial defense counsel filed a motion to withdraw. He listed five reasons for withdrawing, but did not mention the amount of money or include the possibility that he would be a witness. Before trial began, the motion was taken up on the record. The amount of money and the possibility that he would be a witness were not mentioned.
It seems as if any significant factor which might weigh in favor of withdrawal, especially a factor unrelated to the adequacy of representation, would have been raised in the motion and when the motion was argued. When defense counsel suggested at the end of the first day of trial that $240 was missing, the district court stated:
“Well, the other conclusion logically to be drawn is that if we believe what you say — and I’m not saying you’re misleading us — but if we were to believe what you say, the only conclusion that can be drawn is that the Sheriff put over $200 in the bag at the preliminary hearing, then took it out after the preliminary hearing.”
Defense counsel argued that the sheriff tampered with the money to correct the inconsistency talked about at the preliminary hearing.
It does not appear that there is any significance to the amount of money or to the contention that defense counsel might have been a witness on the subject. The matter was never treated as a reason for withdrawal until mid-trial, even though counsel’s withdrawal had been the subject of a written motion and argument on the record. The notion that the sheriff added to and then subtracted from the amount makes no sense and does not seem to pertain to the officers’ credibility or the integrity of the chain of custody. As the State pointed out, the amount of money was not an issue because this was not a case involving a controlled buy of drugs. What relevance the money had was its tendency to show that Dye had the intent to sell drugs, but he was convicted only of possession of drugs.
The decision to discharge an indigent defendant’s counsel and appoint new counsel or permit new counsel to enter an appearance is a matter vested in the sound discretion of the trial court. Oswald v. State, 221 Kan. 625, 631, 561 P.2d 838 (1977). The record in the present case shows that Dye’s counsel was appointed. In the circumstances of this case, there was no abuse of discretion in the district court’s ruling.
Defendant’s conviction of possession of drug paraphernalia is reversed; defendant’s convictions of possession of cocaine and possession of marijuana are affirmed.
The judgment of the. Court of Appeals is affirmed in part and reversed in part. The judgment of the district court is affirmed in part and reversed in part. | [
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The opinion of the court was delivered by
Lockett, J.:
This is a medical malpractice action. Ruby Jones was injured in an automobile accident in November 1985. She underwent a cervical laminectomy on January 17, 1986. During this surgery, the radial nerve in her left arm was damaged. Jones filed this lawsuit on January 16, 1990, more than two years after the surgery. The. trial court granted the defendants’ motions for summary judgment, finding (1) the action was barred by the K.S.A. 60-513(a) two-year limitation for bringing the action, and (2) Anesthesiology Chartered could not be vicariously liable for the acts of its agents under K.S.A'. 40-3403(h). Plaintiff appealed, claiming (1) her action was filed within the period of limitations; (2) the statute of limitations was tolled because of the continuous treatment or blameless ignorance doctrines, fraudulent concealment, or equitable estoppel; (3) she had a separate cause of action against Dr. Robert Beatty that did not relate to the initial surgery; (4) the trial court erred by granting summary judgment on the statute of limitations issue because genuine issues of fact existed; and (5) the trial court erred by granting Anesthesiology Chartered summary judgment.
Ruby Jones sustained injuries to her neck or back in the accident. One of the symptoms of the injury was pain in her right arm. Her physician, Dr. A.P. Taliaferro, referred Jones to Dr. Robert Beatty for treatment of the injuries.
Dr. Beatty hospitalized Jones in January 1986, and performed a cervical laminectomy. The anesthesiologist was Dr. Steven G. Cohn, an employee of Anesthesiology Chartered. The day after the surgery, Jones could not move her left hand and all the fingers on her left hand were curled into a fist. Jones now estimates she has lost 90% of the use of her left hand.
Jones’ deposition indicates that on January 18, Dr. Beatty informed Jones that there had been a problem and they were going to continue to observe the situation. Dr. Beatty told Jones that her condition would be resolved in 2 months. He later informed Jones it would be resolved in 6 months; then 9 months; then 18 months; and finally 2-4 years. During 1987, Jones’ condition did improve such that three fingers on her left hand had uncurled.
Jones’ deposition also indicates that the day after her surgery Dr. Cohn visited Jones in her hospital room. Dr. Cohn told Jones there had been a little problem during the surgery. When asked by Jones what the problem was, Dr. Cohn did not go into any detail but told Jones she was with the right people and the problem would clear up. Jones saw Dr. Cohn two or three times after January 18, 1986. She last talked to Dr. Cohn sometime in 1986, during outpatient physical therapy treatment. Dr. Cohn did not inform Jones her injuries were permanent.
In a deposition, Dr. Beatty indicated Jones’ problem with her left hand and arm was possibly related to the anesthesiologist, Dr. Cohn, positioning the patient during surgery. Dr. Beatty stated that Jones was positioned normally but it was his opinion that a metal strut which held the patient in a sitting position had rested against Jones’ arm, creating pressure against the radial nerve. Dr. Beatty testified that although care was taken, there was sufficient pressure to cause Jones’ injury. Dr. Beatty said he had diagnosed plaintiff’s problem with her left hand and arm as a compressive radial nerve neuropathy which usually improves and it was improving in plaintiff’s case.
Jones last saw Dr. Beatty in 1987 or 1988. In December 1989, Jones discovered the medical records at Providence-St. Margaret Health Center indicate that Dr. Beatty positioned her during the January 17, 1986, surgery, not Dr. Cohn.
After her surgery, Jones contacted two other doctors, Dr. Taliaferro and Dr. Ragland, about her condition. Both doctors informed her that if she was having any problem or had questions she should consult the doctor who was treating her, Dr. Beatty.
In April or May of 1990, Jones consulted doctors at the Neurology Department at the University of Kansas Medical Center. She was advised by the doctors that the radial nerve in her left arm had been damaged. Jones was informed that immediately after surgery Dr. Beatty should have had an EMG performed on her left arm. Jones was told because of Dr. Beatty’s delay, no further improvement of her left hand was now possible. Jones claims she first became aware the condition of her left hand was permanent when she was informed by the doctors at the University of Kansas Medical Center in 1990.
Jones filed Her action on January 16, 1990, four years after the surgery. All defendants filed motions for summary judgment, contending Jones’ action was barred by the two-year limitation of K.S.A. 60-513. Anesthesiology Chartered further contended it should be dismissed as a defendant because it could not be held vicariously liable for its employee’s, Dr. Cohn’s, negligence under K.S.A. 40-3403(h).
The district judge noted that (1) Jones was aware her arm or hand was injured after the surgery on January 17, 1986, or on June 10, 1987, when Dr. Beatty stated in his deposition that Jones had suffered injury and damage during the surgery; (2) in addition to having knowledge of her injury, Jones admitted that two of her friends, who had medical experience, told her that the result of the operation was unusual and unexpected in such a surgical procedure; and (3) despite this knowledge, Jones did not institute this suit until January 16, 1990, well beyond the two-year limitation. The district judge granted all the defendants’ motions for summary judgment, finding (1) the two-year statute of limitations had run and (2) Anesthesiology Chartered could not be held vicariously liable for Dr. Cohn’s acts. Plaintiff raises several issues.
Jones contends there was no evidence before the trial court that either Anesthesiology Chartered or Dr. Cohn had a policy of professional liability insurance such that Anesthesiology Chartered would fall under the no vicarious liability umbrella of K.S.A. 40-3403(h). Jones further contends the doctrine of respondeat superior was not changed by the Kansas Health Care Provider Insurance Availability Act, K.S.A. 40-3401 et seq.
K.S.A. 40-3403(h) provides:
“(h) A health care provider who is qualified for coverage under the fund shall have no vicarious liability or responsibility for any injury or death arising out of the rendering of or the failure to render professional services inside or outside this state by any other health care provider who is also qualified for coverage under the fund. The provisions of this subsection shall apply to all claims filed on or after the effective date of this act.”
Anesthesiology Chartered’s motion for summary judgment stated it was a health care provider who is qualified for coverage under the fund.
The district court correctly concluded K.S.A. 40-3403(h) abolished vicarious liability for health care providers in 1986 and that Anesthesiology Chartered should be granted summary judgment. See Sharples v. Roberts, 249 Kan. 286, 816 P.2d 390 (1991), for a discussion of 40-3403(h).
Was Jones’ action filed within two years after the injury to her left arm or hand was reasonably ascertainable, i.e., within the two-year period of limitations for filing a medical malpractice action? In considering a motion for summary judgment, a trial court must give to a litigant against whom summary judgment is sought the benefit of all inferences that may be drawn from the admitted facts under consideration.
K.S.A. 60-513(a)(7) and (c) provide:
“(a) The following actions shall be brought within two (2) years:
“(7) An action arising out of the rendering of or failure to render professional services by a health care provider, not arising on contract.
“(c) A cause of action arising out of the rendering of or the failure to render professional services by a health care provider shall be deemed to have accrued at the time of the occurrence of the act giving rise to the cause of action, unless the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall such an action be commenced more than four (4) years beyond the time of the act giving rise to the cause of action.”
Jones’ petition was filed on January 16, 1990, more than two years after the January 17, 1986, laminectomy.
Jones nevertheless asserts her action was commenced within two years after she ascertained the extent of her injury. In essence, her contention is that, although she knew her arm had been injured during the surgery, the K.S.A. 60-513(a)(7) limitation did not commence to run on her cause of action until she was informed by doctors at the University of Kansas Medical Center that her injury, was substantial and permanent and that, therefore, the action was filed within the two-year limitation of K.S.A. 60-513(a). The defendants argue the statute of limitations is triggered by knowledge of the fact of injury, not the extent of injury. They cite Brueck v. Krings, 230 Kan. 466, 470-71, 638 P.2d 904 (1982), as authority.
In Brueck, over 12,000 depositors were affected by the collapse of Kansas Savings and Loan Association (Kansas Savings) and the lack of any state or federal insurance guarantee of depositors’ accounts. Four plaintiff depositors filed a class action against multiple defendants, seeking $72,000,000 in actual damages, $150,000,000 in punitive damages, and reasonable attorney fees. More than two years after the action was filed, plaintiffs’ attempt to add Peat, Marwick, Mitchell & Company (Peat, Marwick) as an additional defendant in an amended petition was denied. Plaintiffs appealed. See Brueck v. Krings, 6 Kan. App. 2d 622, 623, 631 P.2d 1233 (1981).
Kansas Savings first employed Peat, Marwick to perform an audit of Kansas Savings’ books for the fiscal year ending June 30, 1971. That engagement was the result of a letter dated May 11, 1971, written by one of the Peat, Marwick partners to Kansas Savings, spelling out the details of the proposed audit; the proposal was accepted in writing by Kansas Savings. Two subsequent audits were performed under oral agreements for the fiscal years 1972 and 1973; the 1973 audit report was delivered on March 1, 1974. Peat, Marwick commenced work on an audit for the year 1974, but encountered various problems. Peat, Marwick wrote to the State Savings and Loan Commissioner on May 5, 1975, advising him that in the process of conducting the 1974 audit, it found that the delinquency status of Kansas Savings’ loan portfolio had deteriorated and that the “magnitude of the . . . loan delinquencies indicates that the operations and financial condition of the Association could be seriously impaired.” Ry letter of September 4, 1975, Peat, Marwick advised the Commissioner that it had been terminated on August 14, 1975, as the'auditor for Kansas Savings, and that the Commissioner would not receive the 1974 audit report from Peat, Marwick. Brueck v. Krings, 230 Kan. at 468.
On January 31, 1977, Kansas Savings was placed under a trustee and it was closed on August 1, 1977. The action by Bernard J. Brueck and other depositors in Kansas Savings was commenced on August 2, 1977; Peat, Marwick, however, was not designated as a defendant at that time. Peat, Marwick was not made a defendant until plaintiffs filed an amended petition on February 16, 1979. 230 Kan. at 468-70.
All the plaintiffs’ claims against Peat, Marwick were tort claims; therefore, the two-year statute of limitations applied. The trial court found that the fact of injury was reasonably ascertainable more than two years before the plaintiffs’ amended petition adding Peat, Marwick as an additional defendant was filed. We stated the crucial information to trigger the running of the statute of limitations is knowledge of the fact of injury, not the extent of injury (citing Friends University v. W.R. Grace & Co., 227 Kan. 559, 608 P.2d 936 [1980]). We found the record demonstrated the plaintiff reasonably could have ascertained the fact of their injury caused by Peat, Marwick considerably more than two years before they attempted to add the firm as an additional defendant. Brueck v. Krings, 230 Kan. at 470-71. It is important to note in Brueck the plaintiffs knew not only the fact of their injury, but were aware of the extent of the injury when they originally filed their petition.
Jones asserts summary judgment was improper because there was disputed evidence as to when substantial injury first appeared or when it became reasonably ascertainable; therefore, the issue of when the statute commenced to run was for the trier of fact to determine. As authority, she cites Cleveland v. Wong, 237 Kan. 410, 701 P.2d 1301 (1985) and Hecht v. First National Bank & Trust Co., 208 Kan. 84, 490 P.2d 649 (1971).
In Hecht, a malpractice action filed more than two years after the injury, Hecht sued to recover damages for injuries she alleged resulted from the defendant doctors’ negligence in administering x-ray and radiation therapy treatments for Hodgkin’s disease.
In the spring of 1964 physicians at the Kansas University Medical Center diagnosed Hecht’s condition as Hodgkin’s disease and recommended radiation therapy in the area of her neck. She was referred to defendants, who were physicians and radiologists. Defendants accepted the pathological diagnosis, and Hecht was given 20 treatments with no significant aftereffects. 208 Kan. at 85-86.
In November of 1965 Hecht noticed lumps in her groin area. After an examination by her family physician, the lumps were removed and sent in for laboratory examination. Hecht was advised by the Kansas University Medical Center in January of 1966 that she had a recurrence of Hodgkin’s disease in the left groin area. She was once again referred to defendants for x-ray therapy. Dr. Platten saw the plaintiff on January 28, 1966, at which time he concluded that plaintiffs condition was “Stage 3 Hodgkin’s disease.” 208 Kan. at 86.
A second course of 20 treatments was planned. The first treatment was given on January 28, 1966. Hecht testified that she first felt a strange “crawling like” sensation and so informed Dr. Platten. During the second treatment on January 31, Dr. Platten found that Hecht had an abnormal skin reaction to the original treatment on the 28th and that there was more redness of the skin than he expected. Hecht complained of some pain in both of her ankles. After Hecht was given further reduced x-ray dosages on February 2, 4, and 7, the radiation treatments were discontinued because of a skin reaction. Treatment was prescribed for the skin reaction. Hecht continued to see defendants. On March 2, 1966, she was examined by both defendants who noted the skin reaction was subsiding. Hecht was seen again by Dr. Platten on March 11, when he described her reaction as slowly healing. 208 Kan. at 87.
At the suggestion of her mother and sister, Hecht arranged for consultation with Dr. Terry E. Lilly, Jr. Dr. Lilly testified that his impression was “that there had been a radiation reaction with breakdown.” Dr. Lilly confirmed the opinion given by defendants, after their examination of Hecht on March 11, that the area was healing. Dr. Lilly made no diagnosis or prognosis as to Hecht’s injury, nor did he advise her that the injury was the result of a radiation burn. 208 Kan. at 87-88.
The first time defendants suspected any kind of permanent damage stemming from the radiation treatments was on July 22, 1966, when Dr. Ripley examined plaintiff and observed that she had some swelling and soreness in the left hip, which was lateral to the inguinal treatment area. 208 Kan. at 88. It was not until December of 1966 that Hecht was finally advised that the ulcer in the groin area, which resulted from the radiation treatment, was. not going to heal of its own accord and would require surgical repair. Plastic surgery was performed on Hecht, consisting of a series of five major and two minor operations. The first plastic surgery was performed in January 1967, and the last in January 1968. 208 Kan. at 89. Hecht filed her petition on March 13, 1968.
Defendants moved for summary judgment, alleging plaintiff’s action was barred by the two-year statute of limitations, K.S.A. 60-513 (Corrick). The trial court granted defendants’ motion, concluding the fact of injury became ascertainable to the plaintiff when she had knowledge of the fact of the burn injury and was aware of its progression to ulceration before March 13, 1966.
On appeal, the Hecht court noted the applicable statute of limitations was 60-513(4), which required plaintiffs cause of action to recover damages to be filed within two years after her cause of action accrued. K.S.A. 60-513 (Corrick) was enacted in 1963 and became effective in 1964. It read in part:
“The cause of action in this section shall not be deemed to have accrued until the act giving rise to the cause of action first causes substantial injury, or, if the fact of injury is not reasonably ascertainable until some time after the initial act, then the period of limitation shall not commence until the fact of injury becomes reasonably ascertainable to the injured party, but in no event shall the period be extended more than ten (10) years beyond the time of the act giving rise to the cause of action.”
The court observed the new provision of the statute was an abrupt change in the previous law with respect to malpractice actions, established by this court in Hill v. Hays, 193 Kan. 453, 395 P.2d 298 (1964); Waddell v. Woods, 160 Kan. 481, 163 P.2d 348 (1948); Becker v. Floersch, 153 Kan. 374, 110 P.2d 752 (1941); and Graham v. Updegraph, 144 Kan. 45, 58 P.2d 475 (1936), that the statute of limitations begins at the time the tort is committed. The Hecht court noted that even though the harshness of the old rule was recogized in Hill v. Hays, the Hill court adhered to the philosophy that limitations are created by statute and are legislative, not judicial, acts. The Supreme Court’s reluctance to decree judicial legislation noted in Hill resulted in the legislature’s action in adding the provision interpreting the term “accrued” when that statute of limitations was reenacted in the form of K.S.A. 60-513 (Corrick). Under the new provision, the period of limitation did not commence until (1) the act giving rise to the cause of action first causes substantial injury or (2) if the fact of injury is not reasonably ascertainable until some time after the initial act, then not until the fact of injury becomes reasonably ascertainable to the injured party. 208 Kan. at 90.
In her appeal, Hecht proposed two theories for reversal of the trial court’s grant of summary judgment. First, Hecht asked this court to adopt either the so-called “continuous treatment” doctrine or the “physician-pátient relationship” doctrine. Under either doctrine, the statute of limitations for a malpractice action is tolled while the defendant physician continues treatment for thé injury involved. Second, Hecht claimed the material facts as to whether her injury was substantial or reasonably ascertainable on March 13, 1966, were in dispute and could not be determined as a matter of law. 208 Kan. at 92-93.
The Hecht court observed that the “physician-patient relationship” and the “continuous treatment” doctrinfes both have considerable support. An examination of the cases in which either of the two doctrines was adopted revealed a judicial effort to soften the harshness of the statutory accrual rule existing in the particular jurisdiction at the time. The court noted the Kansas Legislature preempted policy-making on the subject by enacting in 1963 the additional provision in 60-513 and had given the matter further consideration by enacting in 1970 additional provisions relating to injuries resulting from ionizing radiation. The legislature had not mentioned either the “physician-patient relationship” or “continuous treatment” doctrines as an element in measuring the time in which a cause of action accrues. The court stated it was not inclined to do so by judicially legislating but asserted this was not to say that evidence stemming from the “physician-patient relátionship” or “continuous treatment” doctrines when relevant, would not bear upon the issue as to when substantial injury becomes reasonably ascertainable. 208 Kan. at 93-94.
The Hecht court then observed summary, judgment may be proper on the affirmative defense of the statute of limitations where there is no dispute or genuine issue as to the time when the statute commenced to run. But where the evidence is in dispute as to when substantial injury first appears or when it becomes reasonably ascertainable, the issue is for determination by the trier of fact. 208 Kan. at 93.
The court noted Hecht alleged in her petition that she did not know that she had been injured and the fact of her injury was not reasonably ascertainable to her until surgery was prescribed in January of 1967. Since the evidence presented was inconclusive as to what point in time plaintiffs injury could be said to be substantial or reasonably ascertainable, the Hecht court concluded that plaintiff should be afforded an opportunity to prove that she neither knew nor could reasonably have been expected to know of defendants’ alleged negligence until the date alleged in her petition. A summary judgment based on the premise that plaintiff on March 13, 1966, knew or could have reasonably ascertained that she had suffered substantial injury resulted from alleged acts of negligence by defendants necessitated a finding of fact which was disputed in good faith. 208 Kan. at 92.
In Cleveland v. Wong, 237 Kan. 410, one of the issues on appeal was whether plaintiff Cleveland’s claims were barred by the statute of limitations. Cleveland was admitted to a hospital for treatment of a possible urinary tract infection on May 1, 1978. Dr. Wong examined him on May 2. Rather than combat Cleveland’s urinary infection with effective antibiotics, Dr. Wong recommended that Cleveland undergo a surgical procedure known as a transurethral resection prostate (TUR). After both Dr. Duffy and Dr. Wong advised Cleveland that temporary urinary incontinence and sexual impotence were usual after such an operation, he signed an authorization for surgical treatment which stated that the TUR operation carries with it a risk of post-operative urinary incontinence and sexual impotence. Dr. Wong performed prostate surgery on May 19. 237 Kan. at 411.
Dr. Wong continued to treat plaintiff. Because Cleveland experienced incontinence and impotence, on October 24, 1978, Dr. Wong performed a second TUR operation. Cleveland understood that the purpose of this second surgical procedure was to correct his incontinence; Dr. Wong, however, wrote in his notes that the purpose was to perform a biopsy to rule out the possibility of cancer. The tissue removed was noncancerous. This second surgery did not correct Cleveland’s incontinence. 237 Kan. at 412.
Finally, in the fall of 1979, Cleveland consulted Dr. Bass of the Wichita Urology Group. Dr. Bass, a ufological surgeon, con ducted extensive examinations of Cleveland and concluded that his incontinence was a direct result of his prior prostatic surgery. Dr. Bass found an obvious defect in the sphincter muscle, and tests disclosed that the muscle could no longer exert sufficient pressure to cause the normal retention of urine. As this defect could not be corrected surgically, Cleveland’s incontinence was permanent. Cleveland claimed that his incontinence and his impotency were needlessly caused by the negligence of the defendant. 237 Kan. at 412.
In Cleveland, the first issue was whether plaintiff’s action for medical malpractice was barred by K.S.A. 60-513(a)(7). The Cleveland court noted our prior holding in Hecht v. First National Bank & Trust Co., 208 Kan. 84, that under the provisions of 60-513 a cause of action in malpractice does not accrue until such time as substantial injury results from the alleged acts of malpractice or until the fact of injury becomes reasonably ascertainable. Here, the initial surgery was performed by Dr. Wong on May 19, 1978. Dr. Bass’ opinion was received on September 22, 1979. This action was commenced on August 14, 1980. The issue, then, was whether the fact of injury became reasonably ascertainable to- the plaintiff immediately following the initial surgery. 237 Kan. at 413-14.
Dr. Wong contended that as Cleveland was both incontinent and impotent immediately following the initial surgery, the fact of injury was reasonably ascertainable to him. The Cleveland court observed that this contention overlooked the evidence that Dr. Wong, as well as Cleveland’s personal physician, advised Cleveland that temporary incontinence and impotence were normal immediately following TUR surgery. Thus, while Cleveland knew that he was both incontinent and impotent immediately after the surgery, he had no reason to suspect that those conditions were permanent or that those conditions were the result of any negligence or malpractice on the part of Dr. Wong. The evidence and the positions of the parties presented an issue of fact and the trial court had properly submitted this issue to the jury. 237 Kan. at 414.
In Cleveland, as in Hecht, we again refused to adopt the “physician-patient relationship” or “continuous treatment” doctrines as an element in measuring the time in which a cause of action occurs. Here, however, Jones’ reliance on Hecht v. First National Bank & Trust Co., 208 Kan. 84, and Cleveland v. Wong, 237 Kan. 410, is persuasive. Under K.S.A. 60-513(c), a cause of action in medical malpractice does not accrue until such time as substantial injury results from the alleged act of malpractice or until the fact of injury becomes reasonably ascertainable. Where there is conflicting evidence as to when a cause of action for medical malpractice is deemed to have accrued under K.S.A. 60-513(c), the matter becomes an issue for determination by the trier of fact.
Under the facts of this case evidence stemming from the “physician-patient relationship” or “continuous treatment” doctrines is relevant upon the issue of when it was reasonably apparent to Jones that her injury was permanent, i.e., substantial. Since the evidence is inconclusive, Jones must be afforded the right to have that issue determined by the trier of fact. If we were to decide otherwise, patients having surgery and then suffering an unexpected result would be required to immediately determine if the unexpected result was a substantial injury resulting from malpractice. This would be an uncalled-for result, seriously impairing the physician-patient relationship.
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The opinion of the court was delivered by
Allegrucci, J.:
This is an action by the plaintiff, Carol Lyon, against Hardee’s Food Systems, Inc. (Hardee’s), defendant, for personal injuries sustained when she tripped over an elevated tree grate outside of the Hardee’s Restaurant at the Matfield Green rest area on the Kansas Turnpike. Hardee’s appeals the jury verdict in favor of the plaintiff. The Court of Appeals reversed and remanded with directions to enter a directed verdict for Hardee’s. This court granted plaintiffs petition for review.
The facts are not disputed. Carol and John Lyon stopped at the Matfield Green rest area on the Kansas Turnpike around 7:00 p.m. on December 22, 1988. John parked their vehicle in the nonrestricted parking space closest to the Hardee’s restaurant door. There was a tree surrounded by a grate in the sidewálk between the vehicle and the door. Upon leaving the restaurant, Carol Lyon hit her foot on the grate and fell forward into the front of the vehicle.
At trial John Lyon testified that the grate was “a good two inches, maybe slightly more” above the sidewalk. Carol Lyon testified that the tree grate was raised above the sidewalk approximately two or three inches, but at least two inches. She saw the grate as she was walking out of the restaurant, but did not see that it was raised. The grate was directly in her path from the restaurant door to the vehicle. The grate was painted black. Carol did not pay any particular attention to the light, but she agreed that it was night and there was sufficient artificial light for her to see where she was going.
The manager of the Hardee’s restaurant testified that Hardee’s employees had painted all tree grates during the month before the Lyons-stopped at the rest area. Employees also replaced the rock underneath the grates.
A Kansas Turnpike Authority (KTA) foreman testified that, when he was at the rest area in mid-November, he worked with the grate in issue. It was even with the sidewalk at that time. In early December he saw some freshly painted grates leaning against trees, and the rock beneath several of them had been changed. The grate in issue was in place around the tree, but it protruded above the sidewalk, perhaps more than three inches. The new rock under the grate was too large to allow the grate to sit even with the sidewalk. When he returned to the rest area in January, the grate was still above the sidewalk. KTA employees removed the rock and lowered the grate.
Throughout pretrial, trial, and post-trial proceedings and on appeal, Hardee’s has argued that the court should hold, as a matter of law, that the variance in the sidewalk surface was a slight defect and, therefore, not actionable. Hardee’s moved for partial summary judgment prior to trial and, at the close of the evidence, moved for a directed verdict. The district court denied both motions and submitted the case to the jury. The Court of Appeals agreed with Hardee’s and concluded that the sidewalk unevenness caused by the raised tree grate is not actionable.
Lyon acknowledges that the slight defect in the sidewalk rule is well recognized and does not seek modification of current law. Instead, she argues that actionable negligence is established in the circumstances of this case. She argues that, in light of the surrounding circumstances, the defect is not slight. She further contends that, since the defendant’s active negligence created the defect, the policy reasons for applying the rule are not present and it is not applicable in the present case.
We recently stated the rule which governs personal injury actions due to sidewalk surface irregularities as follows:
“Slight variances or imperfections in sidewalk surfaces are not sufficient to establish actionable negligence in the construction or maintenance of sidewalks.” Sepulveda v. Duckwall-Alco Stores, Inc., 238 Kan. 35, Syl. ¶ 1, 708 P.2d 171 (1985).
This “slight defect rule” has been in effect for municipalities since this court decided Ford v. City of Kinsley, 141 Kan. 877, 44 P.2d 255 (1935). This court examined analogous Kansas cases against the highway commission for highway defects and found that the State was not liable for injuries sustained where the highway defect was “slight and inconsiderable.” 141 Kan. at 879. The court also examined sidewalk decisions from other jurisdictions and found that the prevailing rule was that cities were not liable for slight irregularities. 141 Kan. at 880-81. A treatise was quoted to the effect that the trend was toward making the rules of municipal liability less stringent. 141 Kan. at 881.
The rationale for restricting the exposure was that “ ‘a municipality cannot be expected to maintain the surface of its sidewalks free from all inequalities and from every possible obstruction to mere convenient travel.’ ” 141 Kan. at 881 (quoting 13 R.C.L. 398, 399). “ ‘To keep all sidewalks in perfect condition at all times is practically a municipal impossibility. ’ ” 141 Kan. at 881 (quoting 7 McQuillan on Municipal Corporations § 2974 [2d ed.]). “ ‘To hold a municipality [liable] for accidents occurring from [slight] defects would entail upon them a burden beyond that which they are reasonably required to bear.’ ” 141 Kan. at 880-81 (quoting Terry v. Village of Perry, 199 N.Y. 79, 87, 92 N.E. 91 [1910]).
The slight defect rule adopted in Ford exemplifies the basic negligence formula — “a risk-utility analysis in which the risk inherent in a condition ... is balanced against the utility of the condition . . . and the burden necessary to eliminate or reduce the risk.” Westerbeke and Robinson, Survey of Kansas Tort Law, 37 Kan. L. Rev. 1005 (1989) (citing Restatement [Second] of Torts § 291-93 [1963]). In Ford’s progeny, the risk-utility analysis has been expressed many times over. In Taggart v. Kansas City, 156 Kan. 478, 480, 134 P.2d 417 (1943), it was said that the defendant city “is not required to furnish perfect walks. Its only duty in this respect is to furnish walks that are reasonably safe for use. [Citations omitted.] To impose a greater duty upon cities would be to place upon them too great a financial burden.”
In 1985, after reexamining the rule set out in Taggart, this court concluded: “[I]t is just as valid now as when announced. To reqúire a higher degree of care in street and sidewalk maintenance than the current ‘reasonably safe for use’ standard would make such public improvements financially prohibitive . . . .” Sepulveda v. Duckwall-Alco Stores, Inc., 238 Kan. at 39.
With regard to its application to store owners, in Sepulveda this court-stated: “It is important to note the same rule applies in actions against an individual or private corporation alleged to have created or maintained a defect in the sidewalk. Roach v. Henry C. Beck Co., 201 Kan. at 560; Pierce v. Jilka, 163 Kan. at 239.” 238 Kan. at 38.
As a matter entirely separate from the slight defect rule, at common law there was no duty imposed upon the owner or occupant of premises abutting on a public street to repair the sidewalk or to remove defects from it. See Spear v. City of Sterling, 126 Kan. 314, 316, 267 Pac. 979 (1928), and Jansen v. City of Atchison, 16 Kan. 358, 385 (1876). Liability, therefore, could not be premised on mere ownership or occupancy.
There was provision, however, for holding the owner or occupant responsible where he or she caused the injury by creating some obstruction on the surface of the sidewalk or some excavation beneath it. Jansen, 16 Kan. 358, Syl. ¶ 6. For example, the abutting owner was liable in City of Topeka v. Sash & Door Co., 97 Kan. 49, 50, 154 Pac. 232 (1916), “because of his active fault in producing the defective condition.” The surface irregu larities were caused by the defendant’s driving horses and wagons over the sidewalk. In Spear an Iowa opinion was quoted as follows:
“ ‘It is a general rule almost universally recognized that an owner or tenant in the occupancy of a building abutting upon a public sidewalk or street, who by some affirmative act or perhaps by some act of negligence creates a nuisance is liable to persons injured in consequence of such nuisance.’ ” 126 Kan. at 318 (quoting Atkinson v. Sheriff Motor Co., 203 Iowa 195, 196-97, 212 N.W. 484 [1927]).
The distinction drawn in these early cases between sidewalk defects actively created by and passively allowed to remain by the abutting owner or occupant seems to fade in later cases.
Lyon, however, believes that this distinction is a worthy one, and she makes it an important element of her theory of liability. She argues that Hardee’s “actively creating] the defect should be considered as a significant circumstance in evaluating whether or not the slight defect rule applies.”
The distinction between sidewalk defects actively created by and passively allowed to remain initially became incorporated into the sidewalk defect considerations when the municipal sidewalk defect rule and the common-law rule of liability of abutting property owners were merged in Moore v. Winnig, 145 Kan. 687, 689, 66 P.2d 372 (1937). The marriage occurred without ceremony and in the absence of any discussion of the extension of the application of the rule to include individuals.
Moore was decided two years after Kansas adopted the slight defect rule in Ford. The concept of the nonactionable slight defect was applied in Moore’s suit against an individual whose property abutted the public sidewalk and street. Moore slipped and fell on iron cellar doors, which were covered with ice and snow and allegedly sagged under her weight. There was no allegation as to how much the doors sagged. The petition was wanting in other respects as well. There was no indication that defendant had created the ice and snow condition on the doors or that the sag was the proximate cause of the injury or what the defendant’s status was with respect to the property. Citing Ford, the court stated that a “slight defect does not furnish [a] basis for actionable negligence.” 145 Kan. at 689. Dixon v. Railway Co., 104 Kan. 404, 179 Pac. 548 (1919), and Spear were cited for the proposition that an abutting owner is not liable for injuries unless the sidewalk defect “was such as to constitute a nuisance.” 145 Kan. at 690. Applying these principles, the court concluded that Moore had failed to state a cause of action. .
Nearly 30 years after Moore was decided,, an abutting property owner’s role in creating a defect was the pivotal consideration in Harris v. McConnell, 194 Kan. 800, 401 P.2d 908 (1965). Harris slipped and fell on a sidewalk which allegedly was constructed and maintained by the abutting owner. The opinion cites Clair v. City of Kansas City, 180 Kan. 409, Syl. ¶ 1, 304 P.2d 468 (1956), Pierce v. Jilka, 163 Kan. 232, 181 P.2d 330 (1947), and Jansen, 16 Kan. 358, for the exception to the rule of nonliability of an abutting owner where defects complained of are created by the property owner’s or occupant’s own negligence. Harris succeeded on appeal in haying the trial court’s entry of summary judgment against her reversed.
In the present case, Lyon consistently. has. argued that the surface irregularity of the tree grate was not “slight” within the meaning of the rule. The rule, therefore, does not apply. She argues that Hardee’s actively creating the hazardous condition is one of the circumstances which must be taken into consideration in determining whether the defect is slight. In addition, she argues that defendant’s creation of the defect abrogates policy reasons for the rule and shuts the door on its application in the circumstances of this case.
The Court of Appeals rejected Lyon’s theory, that creation of the defect was one of the circumstances making up the totality of circumstances which should be considered in determining actionability of the defect. Its consideration, therefore, was confined to the analytic factors set out in Taggart and reaffirmed in Sepulveda. r.
With regard to the creation of the defect, the Court of Appeals stated: . . <
“While Carol states that Hardee’s had lengthy. notice pf the raised grate and should have repaired it, this factor. actually reflects on Ilardee’s negligence' in failing to warn of the defect or repair it. Carol’s argument that Hardee’s voluntarily maintained a foreign object in the sidewalk also goes to Hardee’s negligence. According to Sepulveda, 238 Kan. 35, the issue of negligence is not reached until actionability ’ has been determined. ” •
In Sepulveda, the sidewalk defect rule is said to have survived the adoption of comparative negligence. 238 Kan. at 38-39. Suggesting why its resolution of the case differed from that of the Court of Appeals, this court counseled that a distinction “must be made between the actionable defect rule and the issue of plaintiff s negligence. The latter issue cannot be reached until the former is resolved. If there is no actionable defect, there is no negligence and thus nothing to compare.” 238 Kan. at 40.
In Sepulveda this question from Taggart was quoted: “ ‘Was the imperfection in the sidewalk at the place where plaintiff fell so serious as to be an actionable defect, and was plaintiff negligent in her use of the walk in such a way as to bar her recovery?’ 156 Kan. at 480.” 238 Kan. at 38.
The court went on to say: “This statement indicates the issue of whether the sidewalk imperfection constituted an actionable defect was separate and distinct from the issue of whether plaintiff was contributorily negligent.” 238 Kan. at 38.
The discussion in Taggart and in Sepulveda is of the plaintiff s negligence. At the time Taggart was decided, the plaintiff s contributory negligence was an issue. Following the adoption of comparative negligence, Sepulveda’s negligence was said still to be an issue, but only if there was another actor’s negligence to which it could be compared. Thus, the plaintiffs negligence cannot be compared if an examination of the circumstances surrounding the defect reveals that it was not actionable.
In the present case, the Court of Appeals, in accepting Hardee’s argument that the defendant’s negligence in creating the defect is not relevant, has drawn a distinction between the actionable defect rule and the issue of negligence generally, not just plaintiffs negligence. This distinction is not warranted by this court’s language, quoted just above, in Sepulveda.
The policy underlying the slight defect rule is to relieve those who are responsible for construction and maintenance of sidewalks of the financially prohibitive burden of maintaining them in a perfectly level condition, particularly in light of Kansas weather. In this case, the Court of Appeals’ refusal to consider Hardee’s creating the defect and not leveling the grate despite notice, in effect, ignores factors which would not have increased Hardee’s financial burden. Nor would it have increased Hardee’s burden of keeping watch for hazardous conditions. The policy, therefore, is not served by excepting defendant’s negligence in creating the irregularity. The Court of Appeals rejected plaintiffs argument based upon our application of the rule to sidewalk defects not caused by natural occurrences, such as a plywood board in Roach v. Henry C. Beck Co., 201 Kan. 558, 442 P.2d 21 (1968); a fiber doormat in Pierce v. Jilka, 163 Kan. 232; and a steel gutter plate in Biby v. City of Wichita, 151 Kan. 981, 101 P.2d 919 (1940).
In Roach, a sheet of plywood had been placed on the sidewalk to cover a hole which was to be used for planting a tree. In Pierce, plaintiff fell over a fiber doormat which had been placed on the sidewalk in front of the entrance to a hotel. In Biby, plaintiff caught her heel on the edge of a flat steel plate which had been placed over a drain gutter traversing the sidewalk. In Moore plaintiff fell on iron doors in the sidewalk which had been placed there to cover a cellar entrance.
In each of the cases mentioned in the preceding paragraph, the defect was nonactionable even though technically it was created by the defendant. In Harris v. McConnell, the defendant created the irregularity, and the district court’s entry of summary judgment for defendant on the ground that plaintiff had no cause of action was reversed. The issue in Harris was described as follows:
“The petition in this case alleges that it was defendants who constructed the concrete sidewalk in front of their place of business and that when so constructed it was dangerous, defective and unsafe for travel in that it contained holes and depressions, and that the surface thereof was uneven, and that it was constructed on the wrong grade. In other words, the claim is not that the sidewalk became defective through use, age or other means— but rather is that defendants themselves constructed and maintained it in the defective manner alleged.” 194 Kan. at 802-03.
This reasoning was further emphasized by quotes from three Kansas cases and a reference to an annotation in A.L.R.2d to the effect that an abutting owner is not liable for injuries due to sidewalk defects unless the defect resulted from his or her negligence. 194 Kan. at 803.
The affirmative acts of the defendants in creating hazardous conditions does not appear to have been emphasized by the plain tiffs in Roach, Pierce, Riby, or Moore. Indeed, in Moore this court dwelled on the inadequacy of the allegations in the petition to state a cause of action based upon any irregularity of the level of iron doors in the sidewalk. It was noted that the petition failed to allege how much the doors sagged or that the alleged sag was the proximate cause of Moore’s injury. 145 Kan. at 689.
Actionability of a sidewalk defect, as a matter of law, requires a threshold factual determination. In making its determination, the district court seems to have acknowledged defendant’s affirmative act in creating the defective condition. The Court of Appeals did not.
The Court of Appeals extended this court’s instruction to divide surrounding circumstances into those which can be considered as a threshold matter and those, like plaintiffs negligence, which are reserved for consideration if the threshold is passed. The Court of Appeals placed defendant’s acts in the second category, along with the plaintiffs acts. This categorization does not seem to be prescribed by our prior decisions. Under this state’s principles of comparative negligence, acts which are to be compared with defendant’s for the purpose of apportioning fault may fit into the second category. The acts of the defendant in creating the defect, however, are appropriate to the first category.
The Court of Appeals applied the factors enumerated in Taggart and concluded that the defect was slight and, therefore, not actionable. However, in Taggart there was no allegation or finding that the defendant City negligently caused the defect. The allegation of liability against the City was for negligently permitting the defect to exist. We held that in that situation, the defendant City had only a duty to furnish a sidewalk that was safe for use. It is in making that determination that the slight defect rule is applicable. If the defect is slight, then the defect is not actionable. The policy reasons for applying the rule are clearly present in that situation. However, where the surface irregularity of the sidewalk is caused by the negligent acts of the defendant, the negligence is actionable., regardless of whether or not the irregularity is a slight defect. In that situation, the slight defect rule is not relevant to a determination of liability.
We conclude that the decision in Harris is controlling in the present case. Here, plaintiffs claim is based upon a defect neg ligently constructed and maintained by the defendant. That defect was caused by the negligent acts of the defendant and not by the acts of nature or the passage of time. The slight defect rule is not intended to shield from liability those who negligently create and maintain a defect in the sidewalk. Its intended function is to limit the liability of those who permit or allow a slight defect not of their own making to remain. The rule of a slight defect in a sidewalk does not apply where the defect is negligently created and maintained by the defendant.
Hardee’s fallback position is that, if the court does not rule as a matter of law that the defect was nonactionable, the district court should be reversed for failing to instruct the jury on the rule of actionable defects. The instructions requested by Hardee’s are as follows:
“The laws of Kansas provide that sidewalks are in reasonably safe condition even if there are slight variances in the level of the sidewalk surfaces, whether those variations are caused by projections, depressions, or otherwise and a proprietor or operator of a place of business kept open for public patronage is not negligent in the construction or maintenance of a sidewalk with slight variances in the level of sidewalk surfaces.”
“The laws of Kansas provide that variances of up to three inches between adjacent surfaces of a sidewalk area are ‘slight variances’ and do not constitute a dangerous condition or an unsafe condition and the proprietor of the place of business need not repair such a variance or warn of it.”
In view of our holding that the slight defect rule does not apply, the district court did not err in refusing to give the requested instructions. We note, however, that Hardee’s proposed instructions do not accurately state the law had the slight defect rule been relevant in determining liability. A defect is not automatically categorized as nonactionable because it does not exceed a certain physical measurement. All the surrounding circumstances, not just the size of the irregularity, must be taken into account.
“In determining whether a sidewalk is reasonably safe for the use of pedestrians its location, the extent of the irregularity therein, its prior use and its use on the occasion in question are matters to be taken into account.” Taggart, 156 Kan. 478, Syl ¶ 2.
Instead of giving Hardee’s proposed instructions,-Lthe district court instructed the jurors as to the duty owed by Hardee’s to its business visitors:
“A proprietor or operator of a place of business kept open for public patronage owes a duty to use ordinary care to keep in a reasonably safe condition those portions of the premises used by business visitors, and to warn them of dangerous conditions upon the premises of which the proprietor knows, or should know by the exercise of ordinary care, and which are not known to them.
“The duty of Hardee’s is not affected by any obligation of the Kansas Turnpike Association [sic] to maintain the premises.”
The first paragraph of this instruction is PIK Civ. 2d 12.02; the second paragraph is based on PIK Civ. 2d 12.34. We find no error in the instructions given by the district court.
The judgment of the Court of Appeals is reversed, and the judgment of the district court is affirmed.
Abbott, J., not participating.
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The opinion of the court was delivered by
Abbott, J.:
This is a direct appeal by the defendant, Vicky Getz, from her conviction of felony theft. Getz was convicted of the theft of two horses valued at over $500. The Court of Appeals affirmed the conviction, and we accepted review.
On Friday, September 23, 1988, between 3:30 and 4:00 p.m., Forrest Paddock found two paint horses on his property. Paddock had never seen these horses before; he assumed they belonged to his neighbor, Vicky Getz, because he knew Getz often boarded horses. The residences of Paddock and Getz were just a few feet apart. After capturing the horses, Paddock walked them over to Getz’ property. Getz was not home so Paddock tied up one horse in the barn and secured the other horse, who was “rather spirited,” in the corral.
Paddock tried calling Getz several times and eventually reached her that evening. At trial, Paddock testified he could not remember their exact telephone conversation. He stated that after the telephone call he still assumed the horses belonged to Getz, but that Getz had not claimed the horses were hers.
Getz testified that when she returned home that evening between 5:00 and 5:30 p.m., she discovered the horses on her property. Getz stated she did not recognize the horses or remember seeing them previously. After discovering the horses, she made a couple of telephone calls in an unsuccessful attempt to discover from where the horses had come. She then received a telephone call from Paddock, who informed her that he was the one who had secured the horses on her property.
Shortly thereafter, Perry Patton, who had been living with Getz for about one month, arrived home. Getz testified that she believed the horses belonged to Patton and that she told Patton to move the horses because they already had caused damage to her property and injuries to other horses. After working to repair some of the damage, Getz went into the house and called Vicki Smith. Getz previously had sold horses to Smith and her husband, who resided in Hutchinson and were in the business of selling and buying horses. Getz testified she was selling the horses for Patton. Smith agreed to buy the two horses. They arranged for the horses to be brought to the sale bam in Hutchinson the next day.
The next morning Getz and Patton hauled the two horses to Hutchinson, where they met Smith at the sale bam. Getz and Smith unloaded the horses. Smith wrote a check in the amount of $810.40 to pay for the horses. Smith testified that she did not write in the name of the payee. Getz testified that Smith wrote in Patton’s name as the payee. Smith gave the check to Getz, who in turn gave the check to Patton.
Getz and Patton then drove to Smith’s bank. The bank refused to cash the check because Smith was not an authorized signatory on the account and had failed to indicate that she signed the check on her husband’s behalf. Getz and Patton drove to Smith’s residence. After destroying the first check, Smith wrote a new check, which she made payable to Perry E. Patton. Smith testified that she wrote in Patton’s name on the second check because his name had been written in on the first check. Getz and Patton returned to the bank, and Patton cashed the check. Getz testified that she never received any of this money.
William and Shirley Griffing own property in the same vicinity as Getz and Paddock. The Griffings own the two paint horses that were sold. The pasture in which they kept the horses was about one-half mile “as the crow flies” from Getz’ property, but about two miles by road. On September 25, 1988, the Griffings noticed their two paint horses were missing. Shirley Griffing notified the Rose Hill Police and the Butler County Sheriff about the missing horses. She drove around the area for two days looking for the horses. Ginger Hampton, the Griffings’ daughter, assisted her mother with the search on the evening of Tuesday, September 27, 1988. They stopped by Getz’ house because Hampton remembered that Getz dealt with horses; however, Getz was not home. Later that evening, Hampton reached Getz by telephone.
Hampton testified that she introduced herself as Ginger Griffing-Hampton and that Getz acted as if she knew Hampton. Hampton told Getz their paint horses were missing and asked if Getz had seen them. According to Hampton, Getz responded that a neighbor had tied them up at her place. When Hampton offered to come get the horses, Hampton testified that Getz told her the horses were gone — they had broken out of the pen. Hampton stated she then asked for the neighbor’s name, and Getz told her she could not remember the name. Hampton testified Getz then said she was sorry, but Hampton was out of luck. Getz concluded their conversation by offering to help in any way she could.
Getz testified that she did not know Hampton and that she was only trying to be friendly. Getz stated that after Hampton described the horses, Hampton said she had talked with someone who had suggested Getz might know something about the horses. According to Getz, she told Hampton that the horses had been tied up at Getz’ place, but had broken out. In the process, the horses had damaged Getz’ property and injured some of her horses. Getz testified that Hampton sounded as if she did not believe her horses were capable of such damage. Getz then stated she informed Hampton that the horses were no longer there. According to Getz, Hampton expressed her thanks and hung up without leaving her name or number. Getz admitted she had not told Hampton the two paint horses had been taken to a sale bam in Hutchinson and sold. When asked why, Getz testified that she did not know who Hampton was and whether the horses really belonged to Hampton, that Hampton also had not believed that her horses were capable of damaging Getz’ property and injuring her other horses, and that Hampton did not ask her.
Hampton was suspicious of Getz’ story, so Hampton and her mother contacted people in the area who either knew Getz or dealt with horses. It was suggested that they check the sale bams, with Hutchinson being the closest one. Hampton’s husband and mother drove to Hutchinson the next morning, September 28, 1988, and located the two paint horses in a pen behind the sale bam. The Griffings regained possession of their horses. They were informed Getz had sold the horses to Smith.
Shirley Griffing testified that Getz had been at the Griffing farm prior to September 1988. Griffing said Getz had been to their place twice with her ex-husband, who had trimmed the two paint horses. Griffing testified Getz also had stopped by the Griffings in August 1987 to see a horse advertised for sale. The horse for sale and the two paints were together in the corral. Griffing stated that Getz asked her if the two paint horses were for sale. When Griffing told her no, Getz left.
Getz testified she never had gone to the Griffings’ farm to help her ex-husband trim horses. She stated she could not recall ever being at the Griffings, but may have accompanied her ex-husband to their farm when he was interested in purchasing a horse. Additionally, Getz said she never had expressed an interest in buying the two paint horses.
Getz testified Patton moved from her house a few days after this incident. Before trial, the defense attempted unsuccessfully to locate Patton.
Getz was charged with felony theft. The State contended that Getz obtained or exerted unauthorized control over the Griffings’ two horses, which is a violation of K.S.A. 21-3701(a). In addition, Getz was charged in the alternative with violating K.S.A. 21-3701(d), knowingly obtaining control over stolen property. The jury found Getz guilty; however, because a general verdict form was used, the jury convicted Getz of an unspecified type of felony theft. This appeal followed.
I. LESSER DEGREE OF THE SAME CRIME
Getz claims the trial court erred in refusing to instruct the jury on theft of lost or mislaid property, K.S.A. 21-3703, because theft of lost or mislaid property is a generically included offense. Included offenses are governed by K.S.A. 21-3107(2), which states:
“Upon prosecution for a crime, the defendant may be convicted of either the crime charged or an included crime, but not both. An included crime may be any of the following:
(a) A lesser degree of the same crime;
(b) an attempt to commit the crime charged;
(c) an attempt to commit a lesser degree of the crime charged; or
(d) a crime necessarily proved if the crime charged were proved.”
The trial court found that theft of lost or mislaid property is not a lesser included offense because theft of lost or mislaid property contains an element not found in theft, namely that the property must be lost or mislaid. The trial court’s ruling is based on the definition of included offenses found at K.S.A. 21-3107(2)(d). Without explanation, the court also rejected Getz’ “generically included offense” argument. Accordingly, the trial court refused to give an instruction on lost or mislaid property.
The Court of Appeals, in an unpublished opinion filed August 23, 1991, rejected Getz’ argument that theft of lost or mislaid property is a generically included offense. In reaching this conclusion, the Court of Appeals reviewed State v. Gregory, 218 Kan. 180, 542 P.2d 1051 (1975); State v. Long, 234 Kan. 580, 675 P.2d 832 (1984), disapproved on other grounds State v. Keeler, 238 Kan. 356, 710 P.2d 1279 (1985); and State v. Gibson, 246 Kan. 298, 787 P.2d 1176 (1990).
In Gregory, this court held that “manslaughter is a lesser degree of homicide than murder, and for the purposes of K.S.A. 21-3107(2)(a) is a ‘lesser degree of the same crime.’ ” 218 Kan. at 183. Here, “the same crime” referred to in the statute is the generic crime of homicide.
In Long, this court held that under K.S.A. 21-3107(2)(a), “theft is a ‘lesser degree of the same crime’ which embraces robbery.” 234 Kan. at 591-92. The relationship between the two crimes was discussed: “ ‘At common law, robbery consists of larceny plus two aggravating circumstances.’ ” 234 Kan. at 590. “ ‘Robbery and larceny are distinct crimes, although in a generic sense they are but different degrees of the same crime.’ ” 234 Kan. at 591.
In Gibson, this court rejected the argument that aggravated sexual battery is a lesser degree of the crime of rape. This conclusion was reached because “Long and Gregory . . . involved well-recognized generic crimes which had traditionally been part of the common law. [This court has] found no common-law generic crime generally recognized as ‘unlawful sexual act.’ ” 246 Kan. at 302. A four-to-three majority of this court maintains the view that aggravated sexual battery is a separate crime from rape and that a single act can be a basis for conviction of both crimes. State v. Mason, 250 Kan. 393, 827 P.2d 748 (1992).
Here, the Court of Appeals determined that “theft of lost or mislaid property as defined by K.S.A. 21-3703 does not wholly come within the generic crime of larceny” because the statutory definition of K.S.A. 21-3703 is broader than the common-law definition. K.S.A. 21-3703 defines theft of lost or mislaid property as
“failure to take reasonable measures to restore lost or mislaid property to the owner by a person who has obtained control of such property, who knows or learns the identity of the owner thereof, and who intends to deprive the owner permanently of the possession, use or benefit of the property.”
The statutory crime is broader than the common-law crime because
“[a]t common law, the finder of lost or mislaid property commits larceny only when he.takes possession with intent to convert and at the same time knows or has a reasonable means of identifying the owner. The elements must concur at the time of taking.” K.S.A. 21-3703 (Comment by Judicial Council, 1968).
The Court of Appeals noted that the theft statute, K.S.A. 21-3701, contains the common-law forms of larceny. See K.S.A. 21-3701 (Comment by Judicial Council, 1968) (The theft statute “consolidates the . . . crimes of larceny, embezzlement, false pretense, extortion, receiving stolen property and the like into a single crime of théft.”). The Court of Appeals reasoned that because there was a separate statutory definition for theft of lost or mislaid property, theft of lost or mislaid property “must be broader than otherwise would come within the embrace of common law larceny.”
The Court of Appeals did not comment on the following language from Long:
“It is doubtful that in broadening the statutory crime of robbery to include any taking of property from the person or presence of another the legislature intended to separate the crimes of theft and robbery into two distinct unrelated offenses. The Judicial Council comments following K.S.A. 21-3427, the aggravated robbery statute, indicate K.S.A. 21-3426 was intended to include the substance of the formerly defined crimes of first- and second-degree robbery .... The revision of the robbery statute, standing alone, does not indicate a legislative intent to remove robbery from its traditional role as an aggravated form of larceny or theft.” 234 Kan. at 591.
The same analysis applies here. The statutory broadening of the common-law crime of theft of lost or mislaid property does not indicate the legislature’s intent to remove theft of lost or mislaid property from its traditional and well-recognized role as a form of larceny.
Theft of lost or mislaid property (K.S.A. 21-3703) and theft (K.S.A. 21-3701) are both forms of the same crime of larceny. The trial court erred in refusing to give a jury instruction on theft of lost or mislaid property.
II. EXCLUDED EVIDENCE
Perry Patton disappeared prior to trial, and efforts to locate him were unsuccessful. Getz sought permission to testify that Patton told her he had purchased the two paint horses and that he asked her help in selling the horses. Getz claimed the testimony would not be hearsay because it was not being offered to prove whether Patton had purchased the horses. It was being offered to show Getz’ state of mind. A proffer of the testimony was made at trial.
K.S.A. 1991 Supp. 60-460 defines hearsay as “[e]vidence of a statement which is made other than by a witness while testifying at the hearing, offered to prove the truth of the matter stated.” Generally, hearsay evidence is not competent and cannot be used to establish a fact. There are, however, certain exceptions. State v. Oliphant, 210 Kan. 451, Syl. ¶ 1, 502 P.2d 626 (1972). For example, “[ejxtrajudicial statements offered not to prove the truth of the statements, but to prove that the statements were made, are not inadmissible as hearsay.” Prairie State Bank v. Hoefgen, 245 Kan. 236, Syl. ¶ 1, 777 P.2d 811 (1989); see State v. White & Stewart, 225 Kan. 87, 95, 587 P.2d 1259 (1978); Oliphant, 210 Kan. 451, Syl. ¶ 4.
In ruling against Getz, the trial court briefly discussed two cases, State v. Wilson, 220 Kan. 341, 552 P.2d 931 (1976), disapproved in part State v. Quick, 226 Kan. 308, 597 P.2d 1108 (1979), and Oliphant, 210 Kan. 451, that it considered analogous. In Wilson, the trial court excluded the defendant’s testimony regarding statements made by his accomplice, whose whereabouts were not known. On appeal, this court reviewed the general rule:
“If an utterance previously made out of court is offered in evidence merely for the purpose of establishing what was then said, and not for the purpose of establishing the truth of the statement, the testimony is not hearsay. If relevant it is admissible through the person who heard it.” 220 Kan. at 346.
The trial court may have misconstrued Wilson, in which this court held a stranger’s extrajudicial confession that he committed the crime with which the defendant is charged is hearsay and inadmissible to exculpate the defendant. 220 Kan. at 346. That language, however, was held to be overbroad. See State v. Quick, 226 Kan. 308, 317, 597 P.2d 1108 (1979) (error to exclude an extrajudicial confession of a third party offered to establish the truth of the confession as a declaration against interest under K.S.A. 60-460[j]), disapproved on other grounds State v. Jackson, 244 Kan. 621, 772 P.2d 747 (1989).
In Oliphant, police officers were allowed to testify about statements two codefendants had made out of the defendant’s presence. The statements placed the defendant within one and one-half miles of the victim’s house on the day of the crime. On appeal, this court granted the defendant a new trial, stating that
“the utterances were testimonial in character despite the state’s protestations that they were not being offered with that in mind. If not offered as tending to establish the defendant’s presence in the community as a circumstance bearing on guilt, it would seem highly improbable that the state would have insisted on offering the statements at all.” 210 Kan. at 455.
The main issue in Oliphant was the denial of the right to confront witnesses. This court also found the statements were offered to prove the truthfulness of the statement, i.e., the defendant was present in the vicinity when the crime was committed.
Here, based on Oliphant, the trial court decided the proffered statement had probative value on the issue of Getz’ guilt or innocence and ruled that the statement was inadmissible hearsay.
Getz claims the trial court misapplied the Oliphant decision. Getz maintains that Oliphant does not stand for the proposition that an out-of-court statement is subject to exclusion as hearsay if it is probative of the defendant’s guilt or innocence. Instead, Getz contends that the statement in Oliphant was excluded because there was no other purpose for the admission of the statement other than to prove the truth of the matter.
The Court of Appeals agreed with Getz that the proffered testimony was not hearsay. Getz’ proffered testimony was not offered to prove the truth of the matter — whether or not Patton had bought the horses. The Court of Appeals concluded that “[t]he proffered testimony was evidence of a verbal act, that is, that Patton had stated he had purchased the horses. It is relevant to the question of [Getz’] intent. All relevant evidence is admissible. K.S.A. 60-407(f).”
People v. Canamore, 88 Ill. App. 3d 639, 411 N.E.2d 292 (1980), is analogous to the instant case. In Canamore, the defendant was charged with criminal trespass to vehicles. The trial court excluded as hearsay the defendant’s proffered testimony that she borrowed the car from Randy Reed upon his representation that it was his family’s car. On appeal, the trial court’s ruling was reversed.
“In the case at bar defendant was not seeking to prove, by means of Reed’s statement, that the vehicle in question belonged to Reed’s family or his brother; rather, she intended to demonstrate the effect of the statements upon her and her companion. In this manner, she could advance her reason for being unaware the automobile was stolen and buttress the good faith of her beliefs. As the testimony was offered to demonstrate the statement were made, the trial court erred in excluding this evidence. We believe this error was prejudicial and deprived the defendant of a fair trial because it significantly impaired the defendant’s theory of her case. Consequently, a new trial is required.” 88 Ill. App. 3d at 641-42.
We agree with the Court of Appeals that the trial court erroneously excluded the proffered testimony.
The next question is whether the exclusion of this admissible evidence is reversible error. “The admission or the exclusion of evidence must be measured by the harmless error rule governing trial courts. (K.S.A. 60-261.)” State v. Winston, 214 Kan. 525, 530, 520 P.2d 1204 (1974). K.S.A. 60-261 provides, in pertinent part:
“No error in either the admission or the exclusion of evidence ... by the court ... is ground for granting a new trial or for setting aside a verdict . . . unless refusal to take such action appears to the court inconsistent with substantial justice. The court at every stage of the proceeding must disregard any error or defect in the proceeding which does not affect the substantial rights of the parties.”
The Court of Appeals concluded that Getz presented the essence of the erroneously excluded testimony to the jury and that this “cured” the trial court’s error. Getz did testify as follows:
“Q. . . . Why were you selling these horses?
A. To get them out of there.
Q. And were they your horses?
A. No.
Q. Did you have reason to believe they belonged to someone else?
A. Sure.
[The trial court then overruled the prosecutor’s objection that the question had been asked and answered twice.]
Q. ... Did you have reason to believe who owned the horses?
A. Sure.
Q. And who did you believe owned the horses?
A. Mr. Patton.”
Getz further testified:
“Q. This money that was paid to Mr. Patton by a check, did you ever get any of this money?
A. No.
Q. If you did not get any of the money for selling the horses, why did you help Mr. Patton sell the horses?
A. Well, I thought I was helping myself, ‘cause they were a pain as of the time that they were there .... They had ripped down corrals, panels, and they had run over some horses that I had there. They were a nuisance.”
Additionally, when the prosecutor handed Getz a photograph of the horses and asked Getz if she could identify it, Getz responded: “Yes, those are the horses that Perry [Patton] said he bought that used to belong to the Griflñngs.” The State did not make a contemporaneous objection to any of these statements nor move to strike the statements. The trial court, however, had granted a motion in limine, and the State obtained a ruling after the above testimony that neither counsel could argue or mention the above testimony to the jury in closing arguments.
We disagree with the Court of Appeals that the trial court’s error was cured. Even though the trial court refused to allow counsel to argue the evidence, the jury, during its deliberations, thought the evidence was important. The jury sent a note to the trial court inquiring whether there was testimony that Perry told Getz he had bought the horses. The trial court instructed the jury to disregard any testimony of this nature. The record is clear that the trial court intended to, and did, exclude from consideration all evidence that Getz was told by Perry he had purchased the horses and that she was helping him sell them. The defendant was prevented from presenting the issue in her opening statement, from developing it in the course of the trial, from arguing it in closing argument, and from having the jury consider it. This error is not harmless because if the excluded evidence had been admitted the jury could have reached a different result.
The Court of Appeals also held that, because the record did not include the written text of the jury’s question and the trial court’s response, Getz failed to furnish a record on appeal that affirmatively showed prejudicial error. The Court of Appeals reasoned that
“[¡Inasmuch as it remains open to question whether the trial evidence before the jury after the trial court’s response to the jury question included the meat of the proposed testimony of [Getz] that Patton told her he had purchased the horses, we are unable to conclude that [Getz] has borne her burden to make it affirmatively appear that prejudicial error- ■ requiring reversal occurred.” ,
The portion of the trial transcript pertaining to the jury’s question and the trial court’s answer is not ambiguous.
“THE COURT: Counsel, just a few minutes ago the bailiff brought out a question from the jury that basically — as I recall — asked, does the record contain testimony that — of the defendant indicating that she had bought the horses from Perry Patton? Is that not correct? What — What was that, counsel?
“[DEFENSE COUNSEL]: I think the way the question was phrased, does the tape show that Vicky [Getz] testified that Perry [Patton] told her the horses were bought from Griffins [sic]?
“[PROSECUTOR]: That he bought the horses from Griffings.
“[DEFENSE COUNSEL]: That he bought the horses from Griffins [sic].
“THE COURT: Okay.
“[DEFENSE COUNSEL]: Something to that effect.
“THE COURT: Alright. In any event the note will be a part of the record. I have simply chosen to answer the question that, you are instructed to disregard any testimony of this kind — or this kind of testimony.”
The trial transcript includes the “essence” of the jury’s question and the court’s answer. The defendant included the written question and answer in the appendix to the petition for review. We did not consider the copy because it violates Supreme Court Rule 8.03(b) (1991 Kan. Ct. R. Annot. 40) (“[T]he case shall be heard on the record . . . filed with the Court of Appeals.”). The record on appeal is sufficient for this court to address whether Getz’ substantial rights were violated.
If the jury had considered Getz’ testimony that Patton told her he bought those horses and that she simply helped him sell the horses, the jury could have concluded that Getz did not intend to permanently deprive the Griffings of the horses. Without the intent to permanently deprive the owner of the property, a theft conviction cannot stand. “Errors which do not affirmatively appear to have prejudicially affected the substantial rights of the defendant do not require a reversal when substantial justice has been done. [Citation omitted.]” State v. Zamora, 247 Kan. 684, 690, 803 P.2d 568 (1990). There is a reasonable possibility the excluded testimony would have changed the result of the trial; thus, prejudicial error is shown.
Recause prejudicial error was shown and because the trial court erred in refusing to instruct on theft of lost or mislaid property, the judgment of the trial court must be reversed. If the evidence is sufficient to sustain the charges, the case will be remanded for a new trial. If the evidence is insufficient to convict, then the trial court should grant a directed verdict in favor of Getz.
III. SUFFICIENCY OF EVIDENCE
The defendant contends the evidence was insufficient to convict her under either theory. “When the sufficiency of evidence is challenged, the standard of review on appeal is whether, after review of all the evidence, viewed in the light most favorable to the prosecution, the appellate court is convinced that a rational factfinder could have found the defendant guilty beyond a reasonable doubt.” State v. Baker, 249 Kan. 431, Syl. ¶ 11, 819 P.2d 1173 (1991).
The jury returned a general verdict that did not specify the type of theft on which the jury based its decision. Getz cites State v. Garcia, 243 Kan. 662, 763 P.2d 585 (1988), to support her argument that the evidence must be sufficient under either subsection (a) or subsection (d) of K.S.A. 21-3701 to uphold her conviction. In Garcia, the State asserted that the victim was killed while the defendant was burglarizing either a house or a pickup, two separate and distinct burglaries. This court determined that a general verdict of guilty must be set aside if the jury was instructed it could rely on any of two or more independent grounds of guilt and if proof of one of those crimes is not sufficient. In Garcia, we held that because “one of the two alternative theories advanced by the State is not supported by sufficient evidence,” namely the burglary of the pickup, “the defendant’s conviction for burglary and his conviction for felony murder based upon that burglary must be reversed.” 243 Kan. at 673.
In State v. Davis, 247 Kan. 566, 571-72, 802 P.2d 541 (1990), however, this court stated:
“There is a distinction between Garcias rationale that there must be sufficient evidence to convict for both of the separate crimes alleged in the complaint as the underlying crime for proof of felony murder and whether a defendant committed the underlying crime of aggravated robbery by one of several distinct statutory methods, i.e., by force or threat, that constitute the crime of aggravated robbery.”
Under Davis, then, it does not matter whether the jury convicted Getz under K.S.A. 21-3701(a) or (d), or both.
In order to convict Getz under K.S.A. 21-3701(a), the State was required to prove that Getz obtained or exerted unauthorized control over the property with the intent to deprive the owner permanently of the possession, use, or benefit of the property. There is no evidence Getz removed the horses from the Grififings’ pasture. Getz argues that the act of theft, which is not a continuing offense under State v. Gainer, 227 Kan. 670, 608 P.2d 968 (1980), was completed when the horses were removed; therefore, Getz’ sale of the horses cannot be relied upon to establish an act of theft.
The evidence, however, shows that the jury could have found Getz obtained and exerted unauthorized control over the horses when she decided to keep them in her bam on the evening of September 23, 1988, and made an arrangement with Smith to sell the horses the next morning. Her intent to deprive the Grififings permanently of the possession was shown by circumstantial evidence. The jury could have believed that Getz sold the horses even though she knew those horses belonged to the Grififings.
, In order to convict Getz under K.S.A. 21-3701(d), the State was required to prove that Getz obtained control over stolen property knowing the property to have been stolen by another with the intent to deprive the owner permanently of the possession, use, or benefit of the property. Getz argues the evidence does not support that the horses were stolen or that Getz knew the horses were stolen. Shirley Grififings testified, however, that Getz saw and wanted to purchase the two paint horses in August 1987. The Grififings could not find any signs that the horses had broken out of the pasture. Getz testified that she had no idea who owned the horses at the time she called Smith. She also testified that Patton told her he had purchased the horses. There is sufficient evidence to infer that Getz knew the horses were stolen either by Patton or by someone else from whom Patton obtained the horses.
When the evidence is viewed in a light most favorable to the prosecution, a rational factfinder could find Getz guilty beyond a reasonable doubt under either K.S.A. 21-3701(a) or (d). Therefore, the evidence was sufficient to convict Getz under either subsection of the theft statute.
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The opinion of the court was delivered by
McFarland, J.:
This is an insurance coverage dispute. The district court held that coverage existed and entered partial summary judgment in favor of the injured person’s conservators and natural guardians and against the garnished insurance company. Said judgment was certified pursuant to K.S.A. 1991 Supp. 60-254(b), and the insurance company appeals therefrom.
The facts may be summarized as follows. On or about March 20, 1989, Joseph Cox contacted Richard Angleton relative to the purchase of automobile insurance for three vehicles driven by members of. the Cox household. Angleton was an employee of Crown Insurance Agency. He was also an independent agent of Alliance Insurance Co., empowered to issue binders for such compány. At the request of Cox, Angleton obtained quotes from several- companies for insurance coverage for the Cox vehicles.
On March 22, 1989, at approximately 12:10 p.m., Cox’s 18-year-old son, Jason, was operating one of the Cox vehicles. At this time, Derek Slaby was riding on the hood of the vehicle. Slaby slid from the hood and was seriously injured. Joseph Cox went to the scene of the accident and learned Slaby had been injured. Subsequently, at approximately 3:00 p.m. the same day, Cox met with Angleton and completed an Alliance insurance application. One of the questions asked about previous automobile accidents. The answer to the question made no mention of the Slaby accident, nor did Cox say anything to Angleton about the Slaby accident. For purposes of summary judgment, it was stipulated that Cox fraudulently answered the question relative to previous accidents. Angleton signed the application making it a binder, and Cox paid the premium during the meeting. Had the question been answered truthfully, the binder would not have been executed. Subsequently, Alliance processed the application and issued the policy effective 12:01 a.m., March 22, 1989, with policy limits of $100,000 for bodily injury.
On June 6, 1989, Alliance wrote Joseph Cox stating that it considered the policy void ab initio by virtue of Cox’s failure to reveal the accident on the application. The Slabys brought an action against Jason and Carolyn Cox, seeking recovery for Derek’s injuries (cáse No. 89-C-3100). On June 13, 1990, Alliance filed a decláratory judgment action against the Coxes and the Slabys, seeking a judicial determination that the policy was void ab initio of, alternatively, that the policy should be reformed to exclude the Slaby accident (case No. 90 C 1979).
On June 22, 1990, a consent judgment was entered against Jason Cox in the amount of $565,553.25. On August 17, 1990, the Slabys initiated a garnishment proceeding against Alliance. The garnishment proceeding and the declaratory judgment action were consolidated for summary judgment purposes only.
On December 20, 1990, Alliance paid $131,105.43 into court. This represents the $100,000 policy limits plus interest on the entire judgment.
The district court held that the policy could not be rescinded (declared void ab initio) by Alliance nor would reformation be permitted. The basis for the ruling was K.S.A. 40-3118 et seq. and Dunn v. Safeco Ins. Co., 14 Kan. App. 2d 732, 798 P.2d 955 (1990).
Later, Alliance filed a motion to amend the judgment to limit the coverage to $25,000, the statutory minimum. This motion was denied. Alliance appeals from all adverse rulings of the district court.
For its issues on appeal, Alliance contends the district court erred in:
1. refusing to allow rescission of the policy on the basis it was void ab initio or, alternatively, to reform the contract to exclude coverage for the Slaby accident; and
2. refusing to reduce the coverage to the statutory minimum of $25,000 (K.S.A. 40-3107[e]).
K.S.A. 1991 Supp. 40-3118(b) provides in pertinent part:
“Except as otherwise provided in K.S.A. 40-276, 40-276a and 40-277, and amendments thereto, and except for termination of insurance resulting from nonpayment of premium or upon the request for cancellation by the insured, no motor vehicle liability insurance policy, or any renewal thereof, shall be terminated by cancellation or failure to renew by the insurer until at least 30 days after mailing a notice of termination, by certified or registered mail or United States post office certificate of mailing, to the named insured at the latest address filed with the insurer by or on behalf of the insured. Time of the effective date and hour of termination stated in the notice shall become the end of the policy period.”
At common law the right of rescission ab initio for fraud and misrepresentation was available to an insurance company. See American States Ins. Co. v. Ehrlich, 237 Kan. 449, 701 P.2d 676 (1985); Klein v. Farmers & Bankers Life Ins. Co., 132 Kan. 748, 297 Pac. 730 (1931); Dunn v. Safeco Ins. Co., 14 Kan. App. 2d 732.
Kansas appellate courts have twice considered the impact of K.S.A. 1991 Supp. 40-3118(b) on an insurance company’s com mon-law right of rescission for fraud in the application for insurance. These cases are Continental Western Ins. Co., v. Clay, 248 Kan. 889, 811 P.2d 1202 (1991), and Dunn v. Safeco Ins. Co., 14 Kan. App. 2d 732.
In Dunn, the court held:
“The issue is what impact, if any, K.S.A. 1989 Supp. 40-3118(b) has on the right of rescission. That statute was passed in 1974 as part of the Kansas Automobile Injury Reparations Act. That legislation, more commonly known as the ‘no-fault insurance law’ was described in Manzanares v. Bell, 214 Kan. 589, 595, 522 P.2d 1291 (1974), as follows:
‘The liability insurance prescribed by the no-fault legislation is mandatory, and the coverage afforded is extensive. Stated in summary fashion, Section 4 requires every motor vehicle owner to purchase liability insurance as specified by the Act, The operation of a motor vehicle on a highway of this state or property open to public use is prohibited, unless the prescribed liability insurance coverage is in force.’
“This type of legislation has spread throughout the United States and, is in effect in nearly all of our states today. The courts have interpreted ‘no-fault’ insurance legislation as expressing a public policy that one who suffers loss due to an automobile accident shall have a source and a means of recovery, hence, the mandatory requirement of liability insurance. American Underwriters Group v. Williamson, 496 N.E.2d 807 (Ind. App. 1986).
“In pursuance of that public policy, the courts that have considered the issue have universally held that in the case of an innocent third party who has suffered injury from the insured’s operation of an automobile, there is no right of rescission ab initio even for the most blatant fraud. In some, but not all, of those cases, the rationale for the decision was a statutory enactment similar to K.S.A. 1989 Súpp. 40-3118(b). Those courts have held that rescission has been abrogated and that the only remedy for an insurance company is cancellation in strict accordance with the terms of the statute. Teeter v. Allstate Insurance Company, 9 App. Div. 2d 176, 192 N.Y.S.2d 610 (1959), aff’d 9 N.Y.2d 655, 212 N.Y.S.2d 71, 173 N.E.2d 47 (1961).
“Regardless of the reasoning • used, all courts that have considered the question as it pertains to an innocent third party have held that an insurer cannot, on the ground of fraud or misrepresentation, retrospectively avoid coverage under a compulsory insurance or financial responsibility law so as to escape liability to an innocent third party. See, e.g., American Underwriters v. Williamson, 496 N.E.2d 807; Sentry Indemnity Co. v. Sharif, 248 Ga. 395; Safeway Insurance Co. v. Harvey, 36 Ill. App. 3d 388, 343 N.E.2d 679 (1976); Fisher v. New Jersey Auto. Full Ins., 224 N.J. Super. 552, 540 A.2d 1344 (1988); 7 Am. Jur. 2d, Auto Insurance § 37; Annot., 72 A.L.R.3d 804; Annot., 83 A.L.R.2d 1104.’’ 14 Kan. App. 2d at 735-36.
In Dunn, however, the, claim at issue was one filed by the insureds themselves under the collision provisions of the policy. The Dunn court held:
“The cases cited above have all dealt with the question of rescission of a compulsory liability policy under facts wherein the injured party was an innocent victim of an insured’s negligence. The instant case is not controlled by those decisions. Here, we have a dispute between an insurer and its insureds. There is no injured third party, and the insurance company seeks only to avoid paying on a collision claim made by insureds who are guilty of having made material misrepresentations. We note that 40-3118(b) deals only with the cancellation of automobile liability policies. In this case, the insurance company seeks to rescind to avoid a claim made under the collision feature of its policy, which is not mandated by our no-fault law.
“The absence of an innocent third party is a significant distinction from the cases cited above and most courts which have considered the question from this standpoint have upheld the right of rescission. In United Security v. Ins. Comm’r, 133 Mich. App. 38, 348 N.W.2d 34 (1984), the insured had obtained an insurance policy by misrepresenting facts on his application. He was injured in an accident after the policy was issued and then filed suit claiming PIP benefits under that policy. The insurance company defended, arguing that it had the right to rescind ab initio. The commissioner of insurance argued that a statute similar to K.S.A. 1989 Supp. 40-3118(b) controlled the case and that it was the exclusive method of cancelling an insurance policy. The Michigan court ruled in favor of the insurance company, holding that rescission was a remedy distinct from cancellation. The court explained its decision as follows:
‘We emphasize that the person making the claim under the insurance policy here is the insured who made the intentional material misrepresentations; this is not a case in which the claimants are innocent third parties. Panels of this Court have held that the liability of an insurer with respect to insurance becomes absolute whenever injury covered by the policy occurs and that no statement made by or on . behalf of the insured or violation of the policy may be used to avoid liability under such circumstances. Detroit Automobile Inter-Ins. Exchange v. Ayvazian, 62 Mich. App. 94, 99-100, 233 N.W.2d 200 (1975); Frankenmuth Mutual Ins. Co. v. Latham, 103 Mich. App. 66, 68, 302 N.W.2d 329 (1981). See also the dicta in State Farm Mutual Automobile Ins. Co. v. Kurylowicz, supra, 67 Mich. App. 574, 242 N.W.2d 530. However, in those cases the insurance companies were attempting to use acts or misrepresentations by the insured to rescind a policy ab initio and thus avoid liability to other claimants.
‘Michigan’s comprehensive scheme of compulsory no-fault automobile insurance arguably requires as a matter of policy that the insurer rather than innocent third parties bear the risk of intentional material misrepresentations by the insured. However, we see no reason in law or policy for the burden of such a risk to be placed on the insurer in preference to the insured who made the intentionally material misrepresentations. . . .
‘. . . Here, however, no question of reliance on the binder by the public is presented, because the claim for personal protection benefits is made by an insured who made intentional material misrepresentations, rather than an innocent third party.’ 133 Mich. App. at 43-44.
“The point made by the Michigan court is that, in those cases where an innocent third party is involved, there is a public policy which requires a holding that the insurance company cannot avoid liability by rescission. However, in a case where there is no innocent third party involved and the dispute is only between the insurer and its insured, no compelling public policy reasons exist for holding that the insurance company has lost the right of rescission.
“Our decision is limited to those cases where the compulsory features of our no-fault law are not involved and where the controversy is between the insurer and its insured only and no third parties are involved. The question of whether rescission would be permitted in a case involving liability to an innocent third party is not before this court and its resolution is not necessary to our decision. As a result, we do not consider that issue, and our comments on that factual scenario should be considered as dicta only.” 14 Kan. App. 2d at 737-39.
In Continental Western, 248 Kan. 889, we had two claims being made under the policy for which rescission was being sought: (1) by the insured and (2) by a passenger injured in the insured’s vehicle.
After quoting the above portions of Dunn, we stated:
“As noted by the Court of Appeals in Dunn, its comments relative to rescission where innocent third parties are involved are dicta. However, there, as here, both situations have to be discussed in order to show why the public policy is better served by treating claims of the fraudulently insured differently from those of innocent third parties.
“The position taken by the Court of Appeals in Dunn is consistent with 7 Am. Jur. 2d, Automobile Insurance § 37, which states:
‘Since the purpose of a compulsory insurance statute is to assure, so far as possible, that there will be no certificate of registration outstanding without concurrent and continuous liability insurance coverage, and since, once a certificate of insurance has been issued and filed with the commissioner of motor vehicles, the contract of insurance ceases to be a private contract between the parties and a supervening public interest then attaches and restricts the rights of the parties in accordance with the statutory provisions, it is impossible to reconcile the existence of a right to rescind the insurance contract ab initio for fraud with the general scheme of the compulsory insurance law.
‘Thus it has been universally held or recognized that an insurer cannot, on the ground of fraud or misrepresentations relating to the inception of the policy, retrospectively avoid coverage under a compulsory or financial responsibility insurance law so as to escape liability to a third party.’ (Emphasis supplied.)
“To the same effect see Annot., 83 A.L.R.2d 1104 § 2, and cases cited therein.
“We conclude that the rationale expressed by the Court of Appeals in the portions of Dunn quoted herein is sound. We hold:
“1. K.S.A. 1990 Supp. 40-3118(b) is a part of the Kansas Automobile Injury Reparations Act and applies only to the cancellation of automobile liability insurance policies and other features of such liability policies mandated by the Kansas No-Fault Insurance Law.
“2. An insurance company has the right, upon proper proof, to rescind a policy or binder ab initio for fraud or misrepresentation where the controversy involves only the insurer and its insured over nonliability, non-compulsory features of the insurance policy.
“3. Where claims have been made by both the insured acquiring the insurance through fraudulent misrepresentation and an injured innocent third party, severance of the nonliability, noncompulsory features of the policy is proper, thereby permitting rescission ab initio as to the claim of the insured involving provisions not mandated by the Kansas Automobile Injury Reparations Act.” 248 Kan. at 895-96.
Both Dunn and Continental Western involved factual situations where fraudulent statements were made by the insured in the application for insurance, a binder or policy was issued; and then the incident giving rise to the claim or claims occurred. In the case before us, at the time the accident occurred in which Derek Slaby was injured there was no policy or insurance in effect. With knowledge that the accident had occurred and that Slaby had been injured, Joseph Cox filled out the application for insurance, stating there had been no accidents, and obtained an insurance binder. By virtue of insurance practice, the insurance policy subsequently issued stated it was effective at 12:01 a.m. the day the binder was signed rather than sometime after 3:00 p.m. when the binder was actually executed. Whether this practice arises from convenience to avoid computation of partial day premiums or to facilitate obtaining “edge to edge” or continuous coverage is unknown.
The question we must decide is whether the particular facts herein take the case out from under the rule that an insurance company cannot retrospectively avoid coverage to an injured innocent third party on the grounds of fraud or misrepresentation in the application for insurance. We believe that they do.
Under the Kansas Automobile Injury Reparations Act (K.S.A. 40-3101 et seq.), before a motor vehicle may be registered the owner must obtain liability insurance. K.S.A. 1991 Supp. 40-3118(a) provides, in part:
“No motor vehicle shall be registered or reregistered in this state unless the owner, at the time of registration, has in effect a policy of motor vehicle liability insurance covering such motor vehicle, as provided in this act, or is a self-insurer thereof, or the motor vehicle is used as a driver training motor vehicle, as defined in K.S.A. 72-5015, and amendments thereto, in an approved driver training course by a school district or an accredited nonpublic school under an agreement with a motor vehicle dealer, and such policy of motor vehicle liability insurance is provided by the school district, or accredited nonpublic school. As used in this section, the term ‘financial security’ means such policy or self-insurance. The director shall require that the owner certify that the owner has such financial security, and the owner of each motor vehicle registered in this state shall maintain financial security continuously throughout the period of registration. When an owner certifies that such financial security is a motor vehicle liability insurance policy meeting the requirements of this act, the director may require that the owner or owner’s insurance company produce records to prove the fact that stfch insurance was in effect at the time the vehicle was registered and has been maintained continuously from that date.”
The public policy behind the Act is to assure that coverage of at least the statutory minimum levels of liability insurance exists on any vehicle covered by the Act. It is against that public policy to allow insurance companies to renege on the coverage promised as to an innocent injured third party because of an insured’s fraudulent acts in obtaining the insurance. Here it is undisputed there was no coverage at the time the third party was injured. Joseph Cox’s subsequent fraudulent acts resulted in a policy being issued which listed the effective time as 12:01 a.m. of the day the binder was executed — thereby ostensibly covering the accident which had already occurred. Had Joseph Cox done nothing after learning of the accident there would be no policy to dispute. The injured party would have been in exactly the same situation he was in when injured. The rule prohibiting an insurance company from taking away coverage which existed when the injury occurred and the reasons for the rule do not apply. The Cox vehicle was not registered or being operated at the time of the injury .as a result of or in reliance on Alliance having insured the same.
We do not believe rescission which would void the policy ab initio is appropriate herein. The appropriate relief is to reform the policy to exclude coverage for the accident herein by making the policy effective at the time the binder was executed.
Additionally, to hold otherwise would tend to defeat the public policy which lies behind mandatory automobile insurance and encourage people to risk operating uninsured motor vehicles. If one can wait to buy insurance until after an accident occurs and thereby gain coverage therefor, it lessens the incentive to comply with the mandatory insurance law of Kansas.
We conclude that the district court erred in refusing to reform the insurance policy herein to exclude coverage for the Slaby accident.
By virtue of the foregoing determination, we need not address the second issue in the appeal relative to whether or not the $100,000 coverage in the policy should be reduced to the $25,000 statutorily mandated minimum coverage.
The judgment is reversed, and the case is remanded to the district court for further proceedings consistent with the opinion herein. | [
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The opinion of the court was delivered by
Allegrucci, J.:
This is an appeal by Debra Stephenson from the district court’s entry of judgment affirming the award made to her by the administrative law judge in the Division of Workers Compensation. Appellees are Sugar Creek Packing, Stephenson’s employer, and Hartford Insurance Company, the insurance carrier (collectively referred to as Sugar Creek). Stephenson challenges the constitutionality of K.S.A. 1991 Supp. 44-510d(a)(23), which provides that compensation for “repetitive use conditions occurring in opposite upper extremities” shall be computed as separate scheduled injuries. She is joined in her challenge, by amicus curiae Kansas AFL-CIO. Stephenson’s motion to have the case transferred to this court was granted on November 15, 1991.
The facts are not in dispute. Debra Stephenson began working at Sugar Creek Packing, a meat packing plant, in March 1983. She worked as a “3-M Stripper.” Her task involved repetitive gripping, grasping, twisting, and turning with her hands.
In October 1987 Stephenson began experiencing pain, numbness, and swelling in both hands. These problems were worsened by. the requirements of her work. By December 12, 1987, she was no longer able to perform her job.
Stephenson underwent surgical carpal tunnel release oñ her right wrist in July 1988 and on her left wrist in October 1988. She was referred for vocational rehabilitation services until the end of May 1990.
Stephenson was unable to return to work at any wage. She stipulated before the district court that her injury was limited to the upper extremities, without extension into the shoulders.
The sole issue raised in this appeal is whether K.S.A. 1991 Supp. 44-510d(a)(23) violates the equal protection clause of the United States Constitution. Stephenson argues that 44-510d(a)(23) violates the equal protection clause of the Fourteenth Amendment of the United States Constitution in treating “repetitive use conditions occurring in opposite upper extremities” as scheduled injuries rather than as disability to the body as a whole. She contends that 44-510d(a)(23) creates the only classification where injury to both opposite extremities is compensable as separate scheduled injuries. She further contends that the statutory provision is unusual in creating a classification based upon the mechanism of injury.
With regard to the legislative purpose for creating the classification, Stephenson states that it is “unclear from the legislative history.” For the sake of her argument, Stephenson adopts , the district court’s speculation that the State’s objective was to reduce workers compensation insurance premiums.
Stephenson contends that the classification created by 44-510d(a)(23) should be subjected to “heightened scrutiny” because of the importance of the right to full compensation for injury. She mentions that gender-based classifications have been subjected to heightened scrutiny, but she does not argue that this classification is gender based.
She contends that the legislative goal of reducing insurance premiums does not pass muster under any level of scrutiny because the goal could be better served in other ways. She also argues that workers who develop carpal tunnel syndrome, whether from a single trauma or from repeated minute trauma, must receive the same treatment under the law because they are “similarly situated with respect to the legitimate purpose of the law.”
Amicus cuñae Kansas AFL-CIO wants to include in the issue whether the statute violates the equal protection clause of the Kansas Constitution. The issue of state constitutionality does not appear to have been raised in the district court, and it is not raised by appellant Stephenson on this appeal.
With regard to the scrutiny to be given 44-510d(a)(23), Sugar Creek asserts that the rational basis test is appropriate for "social and economic legislation.” Sugar Creek states that it is unnecessary to ascertain the purpose of the statute under the rational basis test. For the sake of argument, however, Sugar Creek notes that the district court deemed the purpose to be lessening the cost of workers compensation insurance and the cost to industry of doing business.
Sugar Creek counters Stephenson’s argument that there were better means available to the legislature to achieve the same result. Sugar Creek relies on 16 Am. Jur. 2d, Constitutional Law § 237 for the proposition that a court may not substitute its notion of how an objective should be accomplished for that of the legislature.
Sugar Creek states that the calculation of compensation for scheduled injuries is not a deviation from the underlying principle of compensation law because “the schedule theoretically includes a consideration of economic loss in earning power. Larson, Worker’s Compensation, (Desk Ed.) § 58.11.” Sugar Creek asserts that it is not necessarily true that compensation for a scheduled injury is less than what it would be if the injury were compensated as one to the body as a whole, i.e., as a matter of disability. Sugar Creek argues that there are conditions other than bilateral carpal tunnel syndrome which depend for compensation under the Act on the mechanism or method of injury — heart and psychiatric conditions and occupational diseases. Finally, Sugar Creek cites Bair v. Peck, 248 Kan. 824, 811 P.2d 1176 (1991), for the proposition that amendments to the Act, even ones involving abrogation of common-law rights or detriment to the employee, may be made without upsetting the constitutional balance.
The district court applied the rational basis test to the statute. No reason was expressed for rejecting Stephenson’s argument that full compensation for injury is a right sufficiently important to merit heightened scrutiny. A gender basis for heightened scrutiny was rejected because “the thrust of claimant’s argument is not on the gender basis” and “there is no basis in the record to conclude that this is a gender based act.”
The legislative purpose which the district court said “may be conceived” for classifying bilateral repetitive use conditions of the upper extremities as scheduled injuries is lessening “the cost of workers compensation insurance and cost to industry of doing business.” The district court concluded that this purpose justifies the alleged discrimination.
Under the Kansas Workers Compensation Act, injuries such as Stephenson’s injury, which do not result in death or total disability, may be compensated either as partial general disabilities, K.S.A. 1991 Supp. 44-510e, or as scheduled injuries, K.S.A. 1991 Supp. 44-510d. In Hughes v. Inland Container Corp., 247 Kan. 407, 422, 799 P.2d 1011 (1990), 44-510e was construed as requiring consideration of “both the reduction of a claimant’s ability to perform work in the open labor market and the ability to earn comparable wages.” K.S.A. 1991 Supp. 44-510d provides that certain injuries to specified body parts are compensated under a schedule rather than with reference to the individual’s loss in earning power.
Stephenson asserts: “The compensation for scheduled injuries is generally substantially less than the compensation which would be due for the same injury if compensated as permanent partial general disability or permanent total disability.” The district court made the following statement with regard to the difference in the amount of the compensation:
“The employee suffering carpal tunnel injury is limited to a scheduled injury award whereas the employee suffering injury to both upper extremities other than from repetitive use is entitled to compensation as and for disability to the body as a whole; a significant distinction in terms of the amount of monetary compensation available in the usual situation.”
Sugar Creek takes issue with this assertion. It postulates circumstances in which
“one may have a scheduled injury and sustain no lost time and no work disability (that is no loss of ability to obtain work on the open labor market and earn a comparable wage). In that instance he would probably receive more' under the schedule than he would if he had not come under the schedule.”
Stephenson received $41,765.85 for her bilateral carpal tunnel condition under 44-510d. There is nothing in the arguments or the record from which a conclusion can be drawn as to the amount she might have been awarded undef 44-510e.
Typical injuries compensated under 44-510d are loss (or loss of use) of finger, toe, hand, foot, arm, leg, and eye, or loss of hearing. Loss of use of one hand due to a repetitive use condition, for example, would be compensated under 44-510d. Before 1987, decisions of this court and the Court of Appeals allowed a worker to be compensated for a partial disability to the body as a whole under 44-510e rather than under 44-510d when both hands, arms, feet, legs, or eyes were injured. Murphy v. IBP, Inc., 240 Kan. 141, 145, 727 P.2d 468 (1986); Hardman v. City of Iola, 219 Kan. 840, 844, 549 P.2d 1013 (1976); Honn v. Elliott, 132 Kan. 454, 295 Pac. 719 (1931); Downes v. IBP, Inc., 10 Kan. App. 2d 39, 40, 691 P.2d 42 (1984), rev. denied 236 Kan. 875 (1985).
In 1987 the legislature added subsection (a)(23) to 44-510d. It provides as follows:
“Whenever the employee is entitled to compensation for repetitive use conditions occurring in opposite upper extremities, whether occurring simultaneously or otherwise, the compensation shall be computed as separate scheduled injuries to each such extremity and the percentage of loss of use thereof shall be increased by 20% of the determined loss of use to each such extremity.” L. 1987, ch. 187, § 6.
According to Stephenson, one result of the amendment was to create a unique classification where injury to both opposite upper extremities is compensable as separate scheduled injuries. An other result is dissimilar treatment of carpal tunnel conditions developed from a single trauma and those developed from repeated minute trauma. These dissimilar methods of calculating compensation for the same or similar injuries because they were caused by different mechanisms is, according to Stephenson, an impermissible denial of equal protection.
The parties take it for granted that “repetitive use conditions occurring in opposite upper extremities” refers to carpal tunnel syndrome. There does not seem to be any question that-carpal tunnel syndrome, Stephenson’s condition, is intended to be at least among the conditions described by the statutory phrase.
There is another matter which the court is being asked to take on faith. It is that carpal tunnel conditions may result from a single trauma. Stephenson merely assumes that it occurs. Amicus curiae makes the following assertion:
“There is also no question that the exact same injury suffered by appellant Stephenson, carpal tunnel, can also be obtained from occupational causes other than repetitive trauma. According to Orthopaedics, 4th Edition, by Samuel L. Turek, 1984, in some patients carpal tunnel develops from trauma, such as after a displaced Colies’ fracture, (p. 1084).”
There is nothing in the record which establishes or refutes that carpal tunnel syndrome may result from a single trauma. We note that, in Martin v. Cudahy Foods Co., 231 Kan. 397, 646 P.2d 468 (1982), this court recognized that tenosynovitis is a condition resulting from either single or repetitive trauma. Tenosynovitis was defined as
“a condition that generally develops over a period of time as opposed to being the result of a single traumatic occurrence and results in the inflammation of a tendon and its sheath. It is not confined to the wrist but may occur in various parts of the body when the tendons are subjected to repeated cyclic activities which might be described as repeated small traumas occurring over a long period of time. It may also result from puncture wounds, contusions and lacerations, or be caused by lymphatic extension from an abrasion. Taber’s Cyclopedic Medical Dictionary (12th Ed. 1973, p. T-16).” 231 Kan. at 399.
We concluded that “[t]hus it is clear that tenosynovitis may be incurred from various types of activity or from individual incidents of trauma or injury.” 231 Kan. at 400. Tenosynovitis is among the conditions described in 44-510d if it develops from “repetitive trauma” rather than a “single trauma.” Workers suffering from tenosynovitis in the opposite upper extremities would be treated dissimilarly based upon whether the condition developed from a “single” or “repetitive” trauma.
As quoted in State ex rel. Schneider v. Liggett, 223 Kan. 610, 613, 576 P.2d 221 (1978), the United States Supreme Court has described the concept of “equal protection” as one which “emphasizes disparity in treatment by a State between classes of individuals whose situations are arguably indistinguishable.” Ross v. Moffitt, 417 U.S. 600, 609, 41 L. Ed. 2d 341, 94 S. Ct. 2437 (1974). Whether or not the legislation passes constitutional muster depends on the relationship borne by the challenged classification to the objective sought by its creation. In the present case this court must examine the relationship between the classification of workers suffering from repetitive use conditions occurring in opposite upper extremities and the objective which was to be served by singling out this group for separate treatment.
The examination of the relationship between the classification and the objective has become quite formalized. The United States Supreme Court articulates and applies three degrees of scrutiny when examining the relationship. The various levels of scrutiny were reviewed by this court in Farley v. Engelken, 241 Kan. 663, 669-70, 740 P.2d 1058 (1987).
The least strict scrutiny is referred to as the “rational basis” test. Relevance is the only relationship required between the classification and the objective. In McGowan v. Maryland, 366 U.S. 420, 425, 6 L. Ed. 2d 393, 81 S. Ct. 1101 (1961), it was explained that “[t]he constitutional safeguard is offended only if the classification rests on grounds wholly irrelevant to the achievement of the State’s objective.” Insofar as the objective is concerned, “[a] statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it.” 366 U.S. at 426. Thus, it appears that the legislature’s purpose in creating the classification need not be established. The- classification must, however, bear a rational relationship to a legitimate objective. As noted by Justice Marshall in his dissent in Lyng v. Automobile Workers, 485 U.S. 360, 375, 99 L. Ed. 2d 380, 108 S. Ct. 1184 (1988):
“The Court fails to note, however, that this standard of review, although deferential, ‘“is not a toothless one.”’ Mathews v. De Castro, 429 U.S. 181, 185 (1976), quoting Mathews v. Lucas, 427 U.S. 495, 510 (1976). The rational-basis test contains two substantive limitations on legislative choice: legislative enactments must implicate legitimate goals, and the means chosen by the legislature must bear a rational relationship to those goals. In an alternative formulation, the Court has explained that these limitations amount to a prescription that ‘all persons similarly situated should be treated alike.’ ”
The intermediate level of scrutiny is termed “heightened scrutiny.” Farley v. Engelken, 241 Kan. at 669. “It requires the statutory classification to substantially further a legitimate legislative purpose.” 241 Kan. at 669. Another, perhaps stronger, statement of the heightened scrutiny test is that the classification “must serve important governmental objectives and must be substantially related to achievement of those objectives.” Craig v. Boren, 429 U.S. 190, 197, 50 L. Ed. 2d 397, 97 S. Ct. 451 (1976).
The highest level of scrutiny requires that the defendant demonstrate “that the classification is necessary to serve a compelling state interest.” Farley v. Engelken, 241 Kan. at 670. This “strict scrutiny” test has been applied by the United States Supreme Court in cases involving classifications such as race and fundamental rights guaranteed by the federal Constitution. It has not been advocated by parties to the present case that the classification created by 44-510d(a)(23) should be subjected to strict scrutiny.
Stephenson and amicus curiae do urge this court to apply the heightened or intermediate level of scrutiny. They offer different rationales for heightening the scrutiny.
Amicus curiae argues that the intermediate level of scrutiny is appropriate because the classification is much more detrimental to women than to men and the legislature was aware of the discriminatory effect at the time of enactment. Amicus curiae concedes that the statute does not expressly distinguish between male and female injured workers. The classification, therefore, is not by gender as the unconstitutionally discriminatory classifications were in Craig v. Boren, 429 U.S. 190 (sale of 3.2% beer prohibited to males under 21 and to females under 18), and Reed v. Reed, 404 U.S. 71, 30 L. Ed. 2d 225, 92 S. Ct. 251 (1971) (probate code required that males be preferred to females where persons of equal entitlement sought to administer an estate).
Amicus curiae argues that the classification, although gender neutral on its face, is gender related. Amicus curiae argues that the legislature was cognizant that the statutory provision it was enacting would affect more women than men. However, there is no real proof in the record that 44-510d(a)(23) will adversely affect more women than men. The legislative committees which considered the proposed amendment were told by various witnesses that women were more susceptible than men to developing carpal tunnel conditions. The record available to this court is not adequate to make such a finding. It contains assertions and opinions but no facts. The trial court correctly found that there is no basis in the record to conclude the characteristic is gender based. Thus, the determination of the constitutionality of 44-510d(a)(23) is not governed by the United States Supreme Court gender-based discrimination cases in which an intermediate level of scrutiny is applied to the relationship between the classification and the objective.
Stephenson relies on the reasoning in Farley v. Engelken, 241 Kan. 663, and Wentling v. Medical Anesthesia Services, 237 Kan. 503, 701 P.2d 939 (1985), for her position that an intermediate level of scrutiny should be applied to the classification created by 44-510d(a)(23). She urges that the important nature of the right to full compensation warrants heightened scrutiny.
Stephenson s reliance on the reasoning in the principal opinion in Farley is misplaced, as explained in Bair v. Peck, 248 Kan. 824; Samsel v. Wheeler Transport Services, Inc., 246 Kan. 336, 355, 789 P.2d 541 (1990); and Leiker v. Gafford, 245 Kan. 325, 363, 778 P.2d 823 (1989). Justice Lockett, writing for the court in Samsel, stated:
“[Ojnly Justice Herd, the author of the opinion, and then Chief Justice Prager applied the heightened scrutiny analysis. Two justices, Justices Lockett and Allegrucci, concurred in the result but disagreed with the application of the heightened scrutiny test and applied the rational basis test. Both agreed that equal protection requires that all who are.injured by another’s negligent act have an equal right to compensation from the negligent tortfeasor, regardless of any classification that the legislature has attempted to impose. If the legislature wishes to change the rules of evidence by abrogating the collateral source rule, it may do so if applied equally to all who are injured by the negligent act of another. The three dissenting justices also applied the rational basis test.” 246 Kan. at 355.
As this court noted in Farley, the classifications which have been subjected to middle-level scrutiny by the United States Supreme Court are ones based on gender and on legitimacy. 241 Kan. at 669.
In Wentling, the collateral source rule, as it was codified before repeal by the 1985 legislature, was held to be in violation of the equal protection guarantees of the federal and Kansas Constitutions. The statute, K.S.A. 60-471, abrogated for certain medical malpractice plaintiffs elements of the common-law rule precluding evidence of compensation from a source other than tortfeasors. 237 Kan. at 515-16.
The majority opinion quoted from Doran v. Priddy, 534 F. Supp. 30, 37 (D. Kan. 1981), to the effect that heightened scrutiny was warranted due to the “putativeness” of the discrimination between classes of plaintiffs which “is lodged within the heart of the judicial process.” 237 Kan. at 518.
The federal court in Doran tested the constitutionality of K.S.A. 60-471 by applying an intermediate level of scrutiny to the relationship between the classification and the objective. That is, it examined whether the classification furthered the legislative goal. A majority of the members of this court agreed with the following conclusions from Doran:
“ ‘This statute is intended to keep down the costs of medical malpractice insurance, and to limit the size of medical malpractice verdicts. The distinction between insured plaintiffs, and ones who must rely upon kindness for some of their pre-litigation care, is not one which furthers that goal. Rather, it substantially undermines that purpose, and at the expense of the indigent litigant. It therefore is violative of the right of all litigants to equal protection under the Fourteenth Amendment to the United States Constitution.’ ” Wentling v. Medical Anesthesia Services, 237 Kan. at 518 (quoting Doran, 534 F. Supp. at 37).
Farley contains the following discussion of the decision in Wentling:
“Judge Theis [in Doran] concluded that, because of the important nature of the rights affected by the statute under review, the court must apply a more stringent standard of review than that applied under the rational basis test. Thus, in Wentling, without specifically so stating, we applied the height ened scrutiny test under the United States Constitution.” 241 Kan. at 670-71.
The question in Farley was whether K.S.A. 1986 Supp. 60-3403, successor to the statute considered in Wentling, violated the equal protection clause of the Bill of Rights of the Kansas Constitution.
Referring to the application of the heightened scrutiny test to the statutory abrogation of certain elements of the collateral source rule in Wentling, the Farley court stated:
“While we are concerned here with the same issue, as hereinafter demonstrated, the Kansas Constitution affords separate, adequate, and greater rights than the federal Constitution. Therefore, we clearly and expressly decide this case upon Sections 1 and 18 of the Kansas Bill of Rights.” 241 Kan. at 671.
Section 1 of the Kansas Bill of Rights is the equal protection clause.
The Farley court looked to the opinion of Justice Prager in Ernest v. Faler, 237 Kan. 125, 697 P.2d 870 (1985), which reversed the summary judgment entered against a plaintiff, who was damaged by a pesticide application, for failure to file notice as required by K.S.A. 2-2457.
Applying Justice Prager’s reasoning to the abrogation of the collateral source rule, this court in Farley stated:
“Admittedly, 60-3403 does not eliminate a medical malpractice victim’s right to bring suit. However, it impairs his remedy if a jury determines the victim is not entitled to full compensation from the defendant because the victim has received benefits from independent sources.
“While we do not reach the issue of whether 60-3403 violates Section 18 of the Kansas Bill of Rights, we find that the right of a victim of medical malpractice to a remedy against the person or persons who wronged him is sufficiently threatened by 60-3403 to require a higher standard of review than the rational basis test.” 241 Kan. at 672.
Stephenson urges that the same reasoning should apply here. K.S.A. 1991 Supp. 44-510d(a)(23), like 60-3403, does not eliminate an injured person’s right to bring an action for compensation. It does, however, like 60-3403, impair the remedy. It is a statutory curtailment, according to Stephenson, of the remedy which had been substituted when her common-law right to recovery was abrogated. Stephenson contends that her remedy was impaired because she would have been entitled to greater compensation if her bilateral repetitive use condition had been treated as a disability rather than as a scheduled injury. Thus, her argument logically would continue, her right to a remedy is sufficiently threatened by 44-510d(a)(23) to require a higher standard of review than the rational basis test.
State ex rel. Schneider v. Liggett, 223 Kan. 610, involved another legislative response to the medical malpractice “crisis.” The constitutionality of K.S.A. 1976 Supp. 40-3401, which required health care providers to obtain professional malpractice liability insurance, was upheld. The equal protection part of that opinion is of note here for its discussion of the curtailed interest’s bearing on the level of scrutiny. The intermediate level of scrutiny is ignored; strict scrutiny is said to come into play in cases involving “suspect classifications” or “fundamental interests.” 223 Kan. at 617. With regard to the latter, United States Supreme Court cases are cited, holding that the right to an education or to practice a profession are not “fundamental interests.” 223 Kan. at 617-18. This explanation was offered: “[T]he determination of a fundamental interest focuses upon whether the right asserted is explicitly or implicitly guaranteed by the Constitution." 223 Kan. at 617. Neither an education nor a professional license is guaranteed by the Constitution. Since K.S.A. 1991 Supp. 44-510d(a)(23) does not affect a fundamental interest or constitute a classification by gender, the proper test to be applied is the “rational basis” test.
Where the rational basis test is the measure of equal protection, “statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it.” (Emphasis added.) McGowan v. Maryland, 366 U.S. at 426. In this regard, Justice Lockett stated in his concurring opinion in Farley: “Where the legislature has enacted statutory provisions that do not unequivocally state the public policy, the courts may interpret the intention of the legislature.” 241 Kan. at 679. No authority has come to this court’s attention which prohibits the court from inferring and supplying a purpose for legislation where it is not expressed, at least for the two least stringent levels of equal protection scrutiny.
Stephenson argues that the legislative goal of reducing insurance premiums for industry does not pass muster under any level of scrutiny. The most compelling reason she advances is that workers who are similarly situated with respect to the purpose of reducing insurance premiums must receive like treatment under the equal protection clause. She contends that all workers who develop carpal tunnel syndrome arising out of and in the course of their employment (so that the injury is compensable under the Workers Compensation Act) are similarly situated with respect to the purpose of reducing insurance premiums. As a matter of equal protection, therefore, these workers must receive like treatment. As a matter of fact, however, they receive dissimilar treatment. Workers who develop the condition as a result of a single trauma are compensated for their disability while workers who develop the condition as a result of repeated minute trauma are compensated for their scheduled injuries. This dissimilar treatment presumably operates to the financial disadvantage of the latter, although, as noted, Sugar Creek disputes this contention, and it lacks support in the record. However, the only purpose presented to this court for the enactment is the logical one, but also the one seemingly pulled out of the air by the district court — holding down the costs of obtaining workers compensation insurance and the costs of doing business for certain Kansas industries. If, as Sugar Creek contends, the compensation paid to an injured worker is not reduced by 44-510d(a)(23), there would be no resulting reduction in insurance premiums or costs to industry and, thus, no objective asserted to justify the classification created by 44-510d(a)(23).
There is no question that K.S.A. 1991 Supp. 44-510d(a)(23) discriminates between workers who suffer loss of opposite upper extremities due to “repetitive” rather than “single” trauma. Is the objective of cutting costs to industry a rational basis for such discrimination? We think not.
In Lyng v. Automobile Workers, 485 U.S. 360, the United States Supreme Court upheld an amendment to the Food Stamp Act which denied benefits to strikers and their families. A majority of the Court found the amendment did not violate the equal protection clause of the Fifth Amendment, based upon a finding that the government’s goal of maintaining neutrality in labor disputes was a legitimate governmental interest. The government asserted two additional objectives which it argued were sufficient to justify the amendment: to cut the costs of the program and to direct the limited funds to those with the greater need. Although finding it unnecessary to address the sufficiency of these objectives, the majority noted that although “fiscal integrity” is a “legitimate concern,” it does not mean “that Congress can pursue the objective of saving money by discriminating against individuals or groups.” 485 U.S. at 373.
Justice Marshall, joined by Justices Brennan and Blackmun, found none of the asserted governmental objectives rationally related to the amendment. As to the objective of cutting costs, Justice Marshall stated:
“According to the Secretary’s reasoning, the exclusion of any unpopular group from a public benefit program would survive rational-basis scrutiny, because exclusion always would result in a decrease in governmental expenditures. Although it is true, as the Court observes, that preserving the fiscal integrity of the Government ‘ “is a legitimate concern of the State,” ’ ante, at 373, quoting Ohio Bureau of Employment Services v. Hodory, 431 U.S. 471, 493 (1977), this Court expressly has noted that a concern for the preservation of resources standing alone can hardly justify the classification used in allocating those resources.’ Plyler v. Doe, [457 U.S.] at 227. We have insisted that such classifications themselves be rational rather than arbitrary. See Reed v. Reed, [404 U.S.] at 76; Shapiro v. Thompson, 394 U.S. 618, 633 (1968). Our cases thus make clear that something more than an invocation of the public fisc is necessary to demonstrate the rationality of selecting strikers, rather than some other group, to suffer the burden of cost-cutting legislation.” 485 U.S. at 376-77.
In Ernest v. Faler, this court said that the constitutional guarantee of equal protection “require[s] that persons similarly situated with respect to the legitimate purpose of the law receive like treatment.” 237 Kan. at 130. This principle was stated in a discussion of Henry v. Bauder, 213 Kan. 751, Syl. ¶ 3, 518 P.2d 362 (1974), which voided the former guest statute “for the reason that the classifications provided in that statute were arbitrary and discriminatory and had no rational basis.” 237 Kan. at 130.
In the present case, Stephenson’s argument unnecessarily narrows the focus of our inquiry. The workers dissimilarly treated are not just those sustaining carpal tunnel conditions from sudden versus repeated trauma, but all workers with bilateral repetitive use conditions of the upper extremities and workers who suffer any other injuries to both opposite extremities. These classifi cations of workers are similarly situated with respect to the goal of cost cutting, but they do not receive like treatment. The equal protection guarantee of the United States Constitution does not preclude the State from classifying persons for purposes of legislation, but it does require that persons similarly situated be treated alike.
To discriminate against an injured worker based solely on whether the injury resulted from “repetitive” rather than “a single” trauma is neither a fair nor reasonable distinction. It permits workers suffering similar injuries caused by the same condition to be treated differently. Such treatment is arbitrary discrimination and not classification. It cannot be justified simply because it cuts the cost of doing business, nor can we reasonably conceive of any set of facts to justify it. The classification created by K.S.A. 1991 Supp. 44-510d(a)(23) is discriminatory, arbitrary, and without rational basis. We therefore hold that K.S.A. 1991 Supp. 44-510d(a)(23) is unconstitutional as a violation of the equal protection clause of the United States Constitution.
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The opinion of the court was delivered by
Six, J.:
This is a condemnation action. The Board of County Commissioners of Sedgwick County, Kansas, (the County) the condemner, appealed the appraisers’ award of $481,525 for a partial taking to the district court under K.S.A. 26-508. Following a trial to the court, Stephen L. Clark, the landowner, was awarded compensation in the amount of $2,858,300. The deficiency judgment in favor of Clark is $2,376,775 plus interest. The district court awarded Clark attorney fees under K.S.A. 26-509 in an amount equaling 40% of the deficiency judgment, including interest. The County appeals.
Jurisdiction is based on our granting Clark’s motion to transfer under K.S.A. 20-3017.
The County asserts numerous errors on appeal. We reverse on two primary rulings of the trial court. We hold that the County’s expert, Reg Cordry, should have been permitted to testify as to market value, and that both Cordry and Norman Albright, also an expert for the County, should have been permitted to testify as to highest and best use. Other rulings of the trial court affected by reversal of these two primary rulings are discussed in the opinion.
We vacate the judgment and remand to the trial court to hear the testimony of Cordry as to market value, and both Cordry and Albright as to highest and best use. We do not remand for a new trial on all issues. It is not intended that the trial court rehear the current record. The case was tried to the court because the parties waived a jury trial. The trial court is to consider the testimony of the County’s experts, together with the current record, and then enter judgment as to value and, if appropriate, attorney fees.
Facts
The subject property, 78.5 acres of land improved with a single family residence, is located outside the city limits of Wichita. Clark and his wife purchased the property with the intent of building a home, which was to set the tpne for a proposed upscale residential development. The Clarks began planning the residence in 1983, commenced construction in September or October 1985, and moved into the 9,000-square-foot residence in December 1987.
The property was zoned “R-l,” suburban residential district. The proposed development required zoning for “AA,” single fam ily dwelling district. In 1987, Clark filed an application for subdivision approval with a sketch plat and a request for the zoning change. On February 18, 1988, the Wichita-Sedgwick County Metropolitan Area Planning Commission (MAPC) unanimously recommended approval of the zoning change subject to platting the property within two years. The County approved the zoning change contingent on completion of the plat within two years.
Clark received an offer of $170,525 from the County to purchase a 13.164-acre right-of-way and a 37.246-acre remnant for the construction of the “K-96 Expressway,” a/k/a the “Northeast Circumferential,” a/k/a the “John Sedgwick Highway.” Clark did not accept the offer. The County filed a petition for eminent domain. Tract #26 in the eminent domain action was a 13.164-acre diagonal right-of-way which cut the remainder of Clark’s tract into two parcels, one lying southwest of the right-of-way containing 37.272 acres and the other northeast of the right-of-way containing 28.064 acres. The 37.272-acre remainder has no access. The 28.064-acre remainder includes Clark’s residence on 5.74 acres.
The case caption of the present action was taken from the original petition for eminent domain. The Willard J. Kiser Living Trust was the owner of one of the other tracts. Clark is the only landowner involved in this appeal.
The amended report of appraisers determined the value of Clark’s property to be $1,321,420 before the taking and $839,895 after the taking for a total award of $481,525. The district court approved the appraisers’ amended report. The County paid the appraisers’ award to the court and it was disbursed to Clark.
The parties stipulated that the date of the taking was April 19, 1989.
Clark filed a notice of appeal from the appraisers’ award. The appeal was docketed as case No. 89 C 1425. On the same day, the County filed its notice of appeal. The County’s appeal was docketed as case No. 89 C 1438.
Both of the appeals were before the trial court for a discovery conference. At that conference the court noted that an order of dismissal would be filed in case No. 89 C 1425, Clark’s appeal. The County’s appeal, case No. 89 C 1438, was to go forward for a pretrial conference. The discovery conference order in the County’s case was approved by both parties; however, the trial judge did not sign the order. The appearance docket confirms the action taken in the order. Clark’s appeal, case No. 89 C 1425, was dismissed for lack of prosecution. The case at bar proceeded as the County’s appeal.
The County filed a motion to dismiss its appeal. The County alleged that its expert appraiser, upon whom the County relied in filing its appeal, was not willing to testify in court. The County asserted that it was attempting to mitigate damages in the event it lost the appeal because Clark may be entitled to attorney fees. Under K.S.A. 26-509, attorney fees are allowed only if the landowner is successful under the County’s appeal. Clark objected to the dismissal, arguing that the court did not have the power to dismiss the appeal without his consent, which he withheld. The trial court agreed with Clark and denied the County’s motion to dismiss its appeal.
Clark filed a motion in limine to prevent the County from presenting evidence of his foreknowledge of the proposed highway route. Clark argued that the matter was irrelevant as to the issue of the values before and after the taking because a governmental entity may not set aside a highway corridor to limit a landowner’s use, thereby depressing the value of the property before the actual taking. The County countered that evidence of foreknowledge is relevant as to mitigation of damages. According to the County, the trier of fact should be allowed to consider whether Clark deliberately built his house and platted the land as a subdivision to elevate its value before the taking. The trial court granted Clark’s motion, reasoning that until a condemnation action is filed, the owner of the property is entitled to use the property in any lawful manner.
Clark also filed a motion to direct the method of ascertaining value. Clark requested the trial court to direct the use of the income or development approach to appraise his property before the taking and the same or cost approach to appraise the value of the property after the taking.
The County furnished Clark with a list of comparable sales. This list included residential properties from the Wichita and Kansas City areas. The County’s appraisers testified at the hearing. The trial court found that the properties were not comparable and ruled that there was no basis for the County to proceed with the market data approach due to the lack of comparable sales. The trial court entered an order directing that the development and/or cost approach should be used to value Clark’s property.
After receiving the County’s expert reports, Clark filed a motion in limine requesting that valuation testimony by the County’s experts, Albright and Cordry, be deemed inadmissible. In support of his motion, Clark asserted that the expert reports valued the land based on the market data approach, relying on comparable sales, in violation of the trial court’s previous ruling. The trial court heard the motion on July 25, 1990. At the hearing, Clark presented the reports of Albright and Cordry along with their depositions in which they were questioned about their reports.
The trial court granted Clark’s motion, prohibiting the fact finder from considering the conclusions of value of the land by Cordry and Albright. The trial court reasoned that their opinions of value were based on the market data approach in contravention of its previous ruling that no comparable sales existed. It is this ruling as to Cordry that we question and discuss later in the opinion. The trial court also reasoned that Albright’s opinion of value lacked foundational support.
The trial commenced four days later. Both parties agreed to waive a jury. Clark, who was also a real estate developer, testified that the value of the undeveloped land (78.5 acres less his 5.74-acre homesite) before the taking was $1,582,626 using what he characterized as the developmental method of valuation. He further stated that the value of his house and 5.74-acre homesite before the taking was $1,825,159 using the cost approach for the house and the developmental approach for the homesite. Clark concluded that the total value of the property before the taking was $3,407,785 (rounded to $3,408,00) and after the taking was $580,000. He emphasized the 37 acres with no access had no value. He stated that because something would have to be done to block the view of the highway and attenuate the noise, he would riot separate the 28-acre remainder from the homesite. Thus, á residential development was no longer possible. Clark’s estimate of value after the taking included the building of a berm at a cost of nearly $500,000. The difference between the before and after values was $2,828,000.
James L. Gardner II, a real estate appraiser, also testified for Clark. Gardner reasoned that the value of the undeveloped land, less the homesite, before the taking was $1,324,000 using what he characterized as the development approach. Gardner stated that the value of the residence and homesite before the taking was $2,033,000 using the cost approach for the residence and the development approach for the 5.74 acres. The total value of the entire tract before the taking was $3,357,000. Gardner estimated the total value of the house and remaining land after the taking at $549,700. Gardner concluded that difference in values before and after the taking was $2,807,300.
The trial court had excluded the County’s experts; consequently, the County presented no evidence of value of the property before and/or after the taking.
Findings of the Trial Court
The trial court found: (1) The most advantageous use of the property before the taking was as a residential development; (2) the upgrade in zoning from R-l to AA was granted contingent upon final platting by April 1990; (3) the property became involved in these proceedings more than a year before that; (4) municipal utilities, including water and sewer, were available; (5) the property was eminently suited for development, and development had started; (6) the value of the entire tract before the taking was $3,408,000; (7) the 37-acre remainder is entirely without access; (8) even after construction of the berm, the sound levels experienced inside the residence, outside in the yard, and over the entire balance of the 28-acre remainder were intrusive, unpleasant, and objectionable; (9) further development of the 28-acre remainder is improbable; (10) the value of the entire remainder after the taking is $549,700; and (11) the amount of compensation and damages to be awarded Clark is $2,585,000. In an order nunc pro tunc, the trial court corrected the damages to be awarded Clark to $2,858,300.
The trial court credited the County with the $481,525 already paid and entered judgment for Clark for the deficiency sum of $2,376,775 plus interest of 11% per annum from April 20, 1989, until paid. The trial court awarded Clark attorney fees,equal in amount to 40% of the deficiency judgment, including interest.
Although we vacate the judgment and remand the case, we shall discuss disputed trial issues raised by the County which should be decided before the case is again considered by the trial court. Because the parties waived a jury trial, we remand to the trial judge who initially decided the case.
The County’s Motion to Dismiss its Appeal
The importance of this issue relates to the ability of the trial court to award attorney fees to Clark under K.S.A. 26-509. K.S.A. 26-509 allows the court to award the landowner attorney fees when the condemner appeals and the jury renders a verdict in an amount greater than the appraisers’ award. Attorney fees may not be awarded on a landowner’s appeal. In re Central Kansas Electric Coop., Inc., 224 Kan. 308, 319, 582 P.2d 228 (1978).
The County argues that the trial court erred in denying its motion to dismiss its appeal. The County suggests the trial court could have allowed Clark to pursue his original appeal, which could have been reinstated with the County’s consent. The County asserts that Clark allowed his appeal to be dismissed, hoping to obtain a windfall of attorney fees under K.S.A. 26-509.
Clark insists that his appeal was dismissed with the consent, or at least the acquiescence, of the County. The County did not appeal the dismissal of case No. 88 C 1425, Clark’s appeal. The dismissal is final and not subject to collateral attack. Clark further argues that the County’s appeal may not be dismissed without his consent, citing City of Wellington v. Miller, 200 Kan. 651, 438 P.2d 53 (1968). We agree. When a valid appeal is taken by a party from an appraisers’ award, K.S.A. 26-508 places the other parties in the position of cross-appellants and the appeal cannot be dismissed over the objection of any party having an interest in the tract. 200 Kan. at 653.
The July 18, 1989, discovery conference order for Clark’s appeal, case No. 89 C-1425, states that a dismissal will be filed. The discovery conference order was approved by counsel for both parties and signed by the trial court.
The trial court sent a notice and journal entry of dismissal to both párties. The notice stated that the journal entry of dismissal would be filed on September 25, 1989, unless cause be shown for not doing so. The journal entry of dismissal was filed on September 26, 1989. No objection was lodged by the County. The record relating to the dismissal of Clark’s appeal supports Clark’s contention that the County consented to or acquiesced in the dismissal of Clark’s appeal.
The Development and/or Cost Approaches
We stated in Ellis v. City of Kansas City, 225 Kan. 168, Syl. ¶ 3, 589 P.2d 552 (1979):
“The three generally accepted approaches used by appraisers in valuing real property are: (a) the market data approach which is based upon what comparable properties had sold for; (b) the depreciated replacement cost or cost approach which is based upon what it would cost to acquire the land and to build equivalent improvements less depreciation; and (c) the income approach or capitalization of income which is based upon what the property is producing or is capable of producing in income.”
See State Highway Commission v. Lee, 207 Kan. 284, 485 P.2d 310 (1971).
The income approach, also known as the development approach when applied to suburban land eminently suited for subdivision and development, begins with the selling price of lots into which the land may be divided, which is then reduced by the development costs and by a discount factor based on the time required to sell the lots. 207 Kan. 285, Syl. ¶¶ 14, 15.
The market data approach, also referred to as the comparable sales approach, is the most common method of valuing real property and should be used when there have been sales of comparable properties in the same locale, near the time of the taking. When the property is so unique that there is no ascertainable market and there are no sales of reasonably similar or comparable property, the other methods — depreciated replacement cost approach or the income approach — may be used. Ellis, 225 Kan. at 172. The trial court has broad discretion in determining what other sales are comparable. Such determination should be made prior to trial. City of Shawnee v. Webb, 236 Kan. 504, Syl. ¶ 4, 694 P.2d 896 (1985).
The County argues that the trial court abused its discretion in allowing evidence of the development and cost approaches to the exclusion of the market data approach. The County asserts sales existed which were comparable and should have been considered.
The County provided two lists of comparable sales, a list of 10 properties from Wichita and a list of 8 properties from the Kansas City area. The trial court correctly ruled that the sales of properties from the Kansas City area were not comparable because they were not from the same market. Albright, an expert for the County, testified about the list of alleged comparable Wichita properties. All but one of the properties were residential houses on residential lots. The remaining property was a 20-acre horse ranch with a 2,278-square-foot house.
The trial court’s finding that the County offered no comparable sales is supported by the evidence. Absent comparable sales to support the market data approach, one of the other methods of valuation — the development approach or the cost approach, or both — must be used. The trial court did not abuse its discretion in ruling that approaches of valuation should be limited to the development and/or cost approaches.
Valuation Testimony by the County’s Expert Appraisers — The Highest and Rest Use of the Property
Four days before trial, the trial court granted Clark’s motion in limine to prohibit the County’s experts from giving their conclusions of value, reasoning that the expert appraisers had used the market data approach in contravention of the court’s previous ruling. The effect was to send the County to trial with no evidence of value. Thus, the only evidence of value was presented by Clark.
At trial, the County proffered the appraisal reports and depositions of Cordry and Albright to preserve the issue for appeal. The County called Cordry as a witness and asked him his opinion of the highest and best use of the property. Clark objected on the grounds that Cordry’s opinion of the highest and best use of the property was only relevant in connection with an appraisal. Clark argued that because the court ruled Cordry could not testify to an opinion of value, his opinion of highest and best use of the tract was also inadmissible. The County argued that an appraisal of the property and an opinion of highest and best use are two separate ideas. The trial court sustained Clark’s objection and prevented Cordry from testifying about his opinion of highest and best use.
The County argues that the trial court erred in excluding Cor-dry’s and Albright’s opinions of value and of highest and best use. The County asserts that such evidence was relevant to the issues of damages and to the credibility of Clark’s expert appraiser. The County does not deny that its appraisers’ reports appear to use the market data approach, but argues that each of the appraisers used that approach with the good faith belief that the proposed development was too speculative, conjectural, and remote to value the the land with the development approach. The County contends that the highest and best use of the land was a question of fact to be determined by the trier of fact; thus, the trial court erred in excluding this evidence.
Clark argues that the County’s appraisers’ reports utilized the market data approach in violation of the trial court’s order. Thus, their opinions of value were properly excluded. As to the exclusion of the experts’ opinions of highest and best use, Clark reasons those opinions were predicated on the assumption that sewer service was not available, contrary to the trial court’s finding. In addition, Clark contends their opinions were not supported by any study or personal experience in the Wichita area. Thus, the trial court properly excluded these opinions.
In his appraisal report, Cordry stated the highest and best use of the property at the time of the taking was for speculative investment pending future development. He based this conclusion on two considerations. First, there was limited demand for new residential construction. Several subdivisions with sewers and comparable locations were not selling well. Second, the subject tract did not have sewers available. Cordry’s report states it values the property using the cost approach. First, Cordry determined the value of the land by using comparable sales of undeveloped land. Second, he estimated the cost of reproduction of the residence, less depreciation. These figures were then added to achieve total values before and after the taking. Cordry assigned a “functional depreciation” rate of 40% of the cost of the residence due to overimprovement. His estimated value of the property before the taking was $945,167 and after the taking was $638,020 for a difference of $307,147. No objection was made by Clark to Cordry’s qualifications as an expert.
In his deposition, Cordry admitted to appraising only the land using the market data approach. This testimony was read to the court at the hearing on the motion in limine seeking to prohibit his trial testimony of value. Clark directed the court to the following questions and answers in Cordry’s deposition:
“Question, ‘All right. So in establishing the land value, you used the market comparison approach, did you not?’
“Answer, ‘Essentially, yes.’
“Question, ‘ “Essentially” bothers me.’
“Answer, ‘Yes, I did.’ ”
However, Cordry’s further explanation at the deposition stated:
“Again, I’m not trying to be argumentative, as a portion of the cost approach, establishing a value of the land, there is an element of market comparison, although it is not what appraisers call the market comparison approach in that particular course. The logic processes are the same and if you were to define it by itself, as an independent approach, it would be called a market comparison approach.”
Cordry did use the cost approach. We have identified the cost approach as “what it would cost to acquire the land and to build equivalent improvements less depreciation.” Ellis, 225 Kan. at 172. The County asserted that development was not feasible at the time of the taking primarily because the County alleged sewers were not available to the tract. Cordry utilized the cost approach which involved using market data of sales of undeveloped land to determine the cost of acquisition of the land. The trial court directed that the development and/or cost approaches should be used. Cordry’s method was not in violation of the court’s ruling.
In his report, Albright first stated the highest and best use of the property was as a residential estate and land to hold for speculation of future development. Albright based this opinion primarily on his conclusion sewers were not available to the land. Albright calculated the speculative value of undeveloped land in the vicinity using market data of comparable sales of undeveloped land. Albright estimated the replacement cost of the residence new at $1,500,000. He stated that a heavy depreciation charge for overimprovement applied. Albright then estimated the value of the property before the taking at $1,000,000 and after the taking at $750,000 for a difference of $250,000.
The trial court, after reviewing Albright’s appraisal report and deposition, observed:
“Although Mr. Albright asserts the cost approach was used, it is quite clear there is simply no basis in fact for such a conclusion. It appears the appraiser literally made no notes or computations (or had access to same at the time of his deposition) to support the conclusions drawn by him. Based on the data set forth in the report and elicited in the deposition, the Court would be compelled to sustain an objection to a conclusion of value by Mr. Albright based upon a cost approach for the reason of lack of foundational support for such a conclusion.”
At the proffer of Albright’s testimony, Clark waived Albright’s qualifications. We have observed that once a witness has qualified as an expert, a court cannot regulate the factors used or the mental process by which the witness arrives at the conclusion. These matters can only be challenged by cross-examination testing the witness’ credibility. However, if the credibility of the testimony is otherwise destroyed, it should be stricken in response to a proper motion. State Highway Commission v. Lee, 207 Kan. at 297-98.
K.S.A. 60-456(b) vests the trial court with authority to limit an expert’s opinion testimony. Admission of expert testimony lies within the sound discretion of the trial court and its ruling thereon will not be disturbed on appeal absent an abuse of discretion. Walters v. Hitchcock, 237 Kan. 31, 35, 697 P.2d 847 (1985).
Our review of the record supports the trial court’s finding that Albright’s conclusions of value lacked foundational support. In his deposition, Albright could not break down his before and after values into separate components of land, replacement cost of the improvement, and depreciation. He stated he appraised the property as a whole in one figure to save confusion. We cannot say the trial court abused its discretion in excluding Albright’s opinion of value.
Clark and James L. Gardner II, Clark’s expert, relied on comparable sales of residential lots to value the property under the development approach. Clark and Gardner valued the house and the 5.74-acre homesite using the cost approach, assigning values of six lots based on comparable sales of residential lots. .(The 5.74-acre site was equivalent in area to six lots.)
Clark explained on direct examination how he arrived at his opinion for the value of the undeveloped land immediately prior to the taking:
“A. We — we valued or priced each lot in relationship to what we knew about the market. ...”
Later, on cross-examination, this was re-affirmed:
“Q. And when determining a value, projected value for this land under the developmental approach, do you not have to take into consideration the estimate of the value in the market place of that type of lot in the Wichita area as a starting point?
“A. The value of the lot?
“Q. What they’re selling for.
“A. Yes.”
Gardner explained his investigation on value and his use of other properties. in the Wichita area.
“A. . . . Accordingly, and with the instructions from the Court, I proceeded with the developmental approach, which estimated the lot value, and I surveyed a number of existing east side developments to ascertain what a— a market value would have been for the — for the subject lots as proposed based on the sale of — of lots elsewhere in the — in the competitive eastern Wichita and Sedgwick County market.
“Q. Now, let me interrupt you.
“There again doing so, were you able to ascertain the probable selling price of lots into which this property might be subdivided?
“A. Yes, sir.
“Q. All right. Go ahead, please.
“A. Would you like an enumeration of those subdivisions that were considered?
“Q. Yes, please.
“A. All right. We — I did a — a survey of all of the Lakepoint and Tallgrass development sales since their inception.
I had Columbian Title do a computer printout for the past five years of— of all of their sales and transactions.
The principal areas that I selected as most comparable included the Tail-grass area, the Penstemon, Wilderness and Woodspring areas since they were the areas that have sold or had the most activity and the most recent activity.”
The above testimony demonstrates that Clark and Gardner also used the market data approach as an element in assigning values to the land under both the development approach for the undeveloped land and the cost approach for the 5.74-acre homesite. Under the cost approach, some method must be used to value the land. Clark and Gardner valued the land using comparable sales of residential lots based on their opinions that the highest and best use of the property was for residential development. Cordry valued the land using comparable sales of undeveloped land based on his opinion that a residential development was not feasible at the time of the taking and the highest and best use of the property was to hold for speculation of future development.
The issue of whether the land was eminently suitable for development was a disputed issue of fact. The trial court found that the highest and best use of the property was for a residential development. However, this finding was made without receiving the County’s evidence to the contrary. We note that K.S.A. 26-513(d) lists factors to be considered in condemnation actions. Factor one is: “The most advantageous use to which the property is reasonably adaptable.”
PIK Civ. 2d 11.11 states:
“In arriving at the market value of the land and interest taken, you should consider all of the possible uses to which the land could have been put, including the best and most advantageous use to which the property was reasonably adaptable, but your considerations must not be speculative, conjectural, or remote. The uses which may be considered must have been so reasonably probable as to have had an effect on the market value of the land at the time of the taking.”
The trier of fact should have considered evidence from both parties on the issue of highest and best use.
Although the issue of highest and best use relates to value, it does not follow under the facts of this case that, because an expert’s opinion as to value is inadmissible, the expert’s opinion as to highest and best use should also be excluded.
The trial court erred in excluding Cordry’s opinion of value and the opinions of Cordry and Albright as to highest and best use of the property. The exclusion of the. County’s valuation expert testimony resulted in Clark presenting the only admissible evidence of valuation. The trial court’s exclusion of such evidence was reversible error and requires that the case be remanded for the trial court to receive the opinions of Cordry and Albright as to highest and best use and the opinion of Cordry as to market value under the cost approach.
Clark’s Foreknowledge of the Highway’s Proposed Location
Prior to trial, the trial court granted Clark’s motion in limine to prevent the introduction of evidence concerning his foreknowledge of the route of the proposed highway across his tract of land. At trial, the parties stipulated to the proffer of what Clark’s testimony would be on the issue.
The County argues that the proffered evidence was relevant and admissible as to (1) the reasonableness of valuing the property under the development approach and (2) the mitigation of damages because Clark knew the right-of-way would cut his property in half before he commenced any efforts to develop the property. The County presents its argument as follows:
“Essentially, the argument of the Condemnor is that a landowner should not be permitted to maximize damages by taking steps to raise the value of the land by taking superficial steps towards the development of a subdivision which in good faith he knows will never be [built] due to the building of the highway, and that even the Landowner should reasonably understand the highest and best use of the tract of land would be subject to the highway to come through his property before he commences any steps towards the development of such tract.”
Clark counters the County’s argument with two assertions. First, the County is arguing that it should be able to announce its intention to build a highway and, by so doing, freeze the price of the land. Clark terms this notion oppressive condemnation by proclamation. Second, Clark states that the stipulated proffer of evidence does not support the County’s contention. We agree. The proffer indicates that Clark did not know the definite location of the highway when he bought his land, planned his subdivision, planned his residence, or when he commenced construction of his residence. The stipulation further states that Clark first received notice from the County that it planned to take his land in September 1988.
Clark relies on Ventures in Property 1 v. City of Wichita, 225 Kan. 698, 594 P.2d 671 (1979). Ventures involved the same highway as the present action.
The County, in the case at bar, attempts to distinguish Ventures. It states that Ventures and the cases upon which Ventures relied were concerned with the government’s abuse of restricting lawful use of land to accommodate potential future uses. The County asserts that the present case involves a different abuse, one by the landowner.
Clark asserts that influence of the public project for which the land is being taken must be ignored. In support of this assertion, Clark cites 4 Nichols on Eminent Domain § 12B.17 (3d ed. rev. 1990).
Clark relies upon our cases which have addressed the “project enhancement” issue. We have established a general rule that a landowner is not entitled to have the value of his land enhanced merely by the result of the public improvement. Lapham v. Urban Renewal Agency, 211 Kan. 869, 870, 508 P.2d 507 (1973).
“In a condemnation case the property owner should neither be penalized nor benefited by any deflationary or inflationary effect of the nature of the improvement itself. In the trial of a condemnation case involving a long delay between the announcement of the public project and the actual taking of the property, the trial court must, of necessity, be given a wide discretion to receive evidence as to the project plans and the time and manner of their initiation, as bearing upon the weight and credibility of the expert witness testimony.” 211 Kan. 869, Syl.
In Hudson v. City of Shawnee, 246 Kan. 395, 406, 790 P.2d 933 (1990), we stated: “The general rule is that enhancement or depressing of value due to anticipated improvements by the project for which condemnation is sought is excluded in detérmining fair market value.”
The rule preventing evidence of the depressing of a landowner s property value does not squarely apply in the case at bar. Neither the County nor Clark are arguing that public knowledge of the highway depressed the value of his property. However, the County is arguing that due to the highway project, Clark’s property could not have been used as a subdivision because the highway was planned to go through the middle of his tract. Thus, indirectly, the County is arguing that the impact of the highway project reduced the available use of the property.
Clark was entitled to use his property for its highest and best use until the taking. The trial court did not err in granting Clark’s motion in limine preventing evidence of Clark’s foreknowledge of the highway’s route.
Conversations with Clark’s Expert Witnesses
The County alleges that the trial court erred in excluding the testimony of two of its witnesses, Jack Galbraith and Jim Weber. The County asserts that Clark’s expert witnesses John Gist, Brent Wooten, and Gardner, in Clark’s case in chief gave testimony regarding conversations they had had with Galbraith and Weber. The County does not set out this testimony but does refer to the record. The County alleges the testimony of Galbraith and Weber was proffered to refute the content of the purported conversations with Gist, Wooten, and Gardner.
Clark argues that Galbraith’s proffered testimony was beyond his pretrial essence statement; thus, the trial court appropriately excluded it. In addition, he asserts that the proffered testimony does not contradict any testimony given by Clark’s witnesses. There were no hearsay objections when Clark’s witnesses testified.
Gist testified Galbraith indicated that prior to submitting a preliminary plat, Clark should file for a change of zoning from R-l to AA. Galbraith’s proffered testimony agreed that he told Gist a zoning change was needed. Clark is correct; Galbraith’s testimony does not contradict Gist’s. Thus, although it appears Galbraith’s testimony was not beyond the essence statement contained in the County’s pretrial questionnaire, Galbraith’s testimony did not contradict Gist’s testimony; in fact, it agreed with Gist’s. The exclusion, even if erroneous, was harmless error.
As to Weber, Clark asserts that Weber was prevented from testifying because he was not listed on the County’s list of witnesses on the pretrial order. Weber was in no sense a rebuttal witness. Therefore, the trial court did not abuse its discretion in prohibiting his testimony. Furthermore, Clark asserts that no proffer was made of Weber’s testimony.
It is necessary to examine the testimony of Wooten and Gardner regarding Weber. Wooten testified that he contacted Weber, a civil engineer with the public works department, and Darryl Osborn, the plant facilities maintenance man. As a result of this investigation, Wooten determined that there was available sewer capacity as planned in Clark’s sewer proposal. He did not state Weber had approved the plan.
The County refers to Gardner’s testimony. Weber is not mentioned in the portion of Gardner’s testimony cited by the County.
The pretrial order controls the subsequent course of the trial, unless modified by the court to prevent manifest injustice. K.S.A. 1990 Supp. 60-216. The trial court has broad discretion in admitting or excluding testimony of witnesses not specified in the pretrial order. State Farm Fire & Cas. Co. v. Liggett, 236 Kan. 120, 124, 689 P.2d 1187 (1984).
The County has failed to show how the proffered testimony contradicted previous testimony by Wooten or Gardner. Thus, the County has failed to show the trial court abused its discretion in excluding Weber’s testimony.
The Highest and Best Use of the Property
The County contends that the trial court erred in finding the highest and best use of Clark’s property was for residential development because sewer services were not available to the tract. The County places great weight on the fact that Clark’s proposed sewer plan had not been approved; thus, at the time of the taking the tract did not have sewer service available. The County contends the proposed development was conjectural, speculative, and remote.
Clark counters that the undisputed evidence shows that the proposal was feasible and would have been approved; consequently, the development was not conjectural, speculative, or remote.
We vacate this finding on the basis of our ruling that the County’s experts should have been permitted to testify as to highest and best use. Upon remand, the question as to highest and best use is an open one for the trial court’s determination.
Abandonment
Next, the County argues that Clark’s development had been abandoned at the time of the taking.
The trial court found that platting would have been completed, but for the intervention of the condemnation proceedings. This finding is supported by the evidence. Clark received sketch plat approval in February or March 1988. He was formally notified that his land would be taken for public use in September 1988, by an offer to purchase. The petition for eminent domain was filed on November 10, 1988. Following receipt of the September 1988 offer to purchase, Clark had no reason to take further steps in the development. In addition, his zoning change was granted subject to platting within two years. Therefore, he could have reopened the sketch plat file and obtained final zoning approval at anytime before February or March 1990.
Clark’s Cost Valuation of the Residence
Clark’s estimate of value before the taking relies, in part, on his itemized cost of construction of the residence. The County argues that this cost figure included items which cannot be considered cost of the residence — pasture seed, mowing of the pasture, legal fees, arbitration expense, mortgage title insurance fees, and unexpended costs for Clark acting as “job superintendent” and “general contractor.”
Clark asserts that the County lost these arguments at trial and does not supply any authority on appeal to support the contentions.
Clark’s itemized statement of costs was introduced without objection. The County cross-examined Clark regarding these costs. The County did not question any of the above costs except the mortgage title insurance fees and the costs for job superintendent and general contractor.
Although we vacate the trial court’s findings of value and of highest and best use, we note that, under the facts of this case, Clark’s itemized cost of construction of the residence is competent evidence for the trial court’s consideration on remand.
The Value of the 5.74-Acre Homesite
Next, the County asserts that the 5.74-acre homesite was valued inappropriately.
Clark valued the 5.74 acres at $210,000. He arrived at this value by figuring that the land was equivalent to 6 of the estate lots in the proposed development which were to sell for $35,000 per lot. Gardner used the same approach, valuing the lots at $30,000 each to arrive at a cost for the homesite of $180,000.
The trial court, on remand, is to consider the testimony of Cordry and Albright with the testimony of Clark and Gardner, which is in the record, in determining the value of the 5.74-acre homesite.
The Absorption Rate for Sale of the Residential Lots
The County asserts that any valuation of the land based on an assumption of 100% absorption rate (meaning all the lots would sell) was conjectural, speculative, and remote. The County reasons that Clark is not experienced in this type of development and could not expect a 100% absorption rate.
Clark testified that he had studied the rate of absorption of sales in the Wichita residential lot market. Based on these studies, he predicted it would take three years to sell all of the lots. Clark testified that the Tallgrass development had sold out in three years. Gardner testified that he studied lot sales from several developments in Wichita occurring between 1983 and 1990. Based on this study, he projected that Clark’s proposed subdivision of 110 lots would sell out in two years, 55 lots per year.
The testimony of Clark and Gardner supports the assumption of a 100% absorption rate used to calculate the value of the land before the taking. Therefore, this alleged error may not be used to exclude their opinions of value.
The Value After the Taking — Highway Noise
The County argues that the trial court erred in finding the value of the property after the taking was $549,700. In support of this argument, the County asserts: (1) The harm of the highway noise is diminished because Clark works long hours away from home; (2) the residence is close to 127th Street and to flight patterns of the Beech Aircraft plant and McConnell Air Force Base; (3) the depreciation for the noise nuisance of the highway was conjectural and speculative; and (4) because the property value was reduced due to the noise, it should have been increased by the value of the berm.
Clark’s noise experts stated that although the proposed berm would improve the noise nuisance, it would not alleviate it. Both Clark’s and Gardner’s estimate of value after the taking took into account the cost of the berm and the improved noise level.
The noise experts conducted a noise impact study using a stretch of Highway K-96. One expert estimated that the noise level on Clark’s patio would be approximately 73 decibels and could easily approach 80 decibels with the highway at maximum use. To provide a reference, the expert estimated the noise level of the courtroom at 40 decibels if everyone were quiet.
The trial court found that the noise level which will be experienced inside the residence and outside in the yard will be intrusive, unpleasant, and objectionable. We find no error in the trial court’s finding as to the effect of the noise level. The foregoing, testimony supports Clark’s theory of value after the taking. Because we have vacated the judgment, the trial court is to reconsider the value of the property after the taking.
Attorney Fees
The County argues that Clark is not entitled to attorney fees under K.S.A. 26-509 because he appealed the appraisers’ award and then dismissed his appeal.
The County cites In re Central Kansas Electric Coop., Inc., 224 Kan. 308, 582 P.2d 228 (1978). In Central Kansas Electric, both the condemner and the landowners appealed the appraisers’ award. Five minutes before going to trial, the landowners announced that they were dropping their appeal. The jury returned a verdict for the landowners in excess of the appraisers’ award. The trial court allowed the landowners attorney fees under K.S.A. 26-509. The condemner appealed. We found that the attempted dismissal appeared to be an attempt to place the landowners in a position to request attorney fees. We held: “Under the circumstances of this case and the attempted dismissal by the landowners, it was error to allow attorney fees to the landowners when they had originally been appealing parties.” (Emphasis added.) 224 Kan. at 319.
The case at bar may be distinguished. Clark’s appeal was dismissed almost a year, not five minutes, before trial. The County did not move to dismiss its appeal until approximately six months later. The County did not object to Clark’s dismissal at the discovery, conference or after receiving the notice of the trial court’s intended dismissal! Central Kansas Electric is not controlling.
The. County reasons that K.S.A. 26-509 does not authorize attorney fees in this case. The plain language of the statute refers to a jury verdict. Both parties waived a jury trial; therefore, the County asserts attorney fees are not recoverable. Clark does not address this argument.
It should be noted that this argument was not presented to the trial court. In addition, the County’s position is inconsistent with the position it took at the hearing on the motion for attorney fees. Counsel for the County made the following comments as a prelude to arguing that attorney fees for the landowner must be reasonable:
“Your Honor, I think it’s very clear from the virtually uncontested evidence you’ve got here that Mr. Mellor and Mr. Higgins are entitled to a large fee for the amount of work they’ve done. They’ve done a marvelous job on behalf of their client. I have no quarrel with that. I have no quarrel with the amount of hours they spent or begrudge them on a personal level for their success, notwithstanding the position I have to take on behalf of my client. ”
Normally, issues not raised before the trial court may not be raised on appeal. However, there is an exception to the rule when the issue is a question of law which may be decided on established facts. Pierce v. Board of County Commissioners, 200 Kan. 74, Syl. ¶ 3, 434 P.2d 858 (1967). This issue involves construction of a statute, which is a question of law, and may be decided on the established fact that the case was tried without a jury. Thus, the exception applies.
K.S.A. 26-509 states:
“In an actiqn on appeal the court shall assign the case for trial to a jury, or to a master in accordance with K.S.A. 60-253, or acts amendatory thereof or supplemental thereto. Whenever the plaintiff condemner shall appeal the award of court appointed appraisers, and the jury renders a verdict for the landowners in an amount greater than said appraisers’ award, the court may allow as court costs an amount to be paid to the landowner’s attorney as attorney fees.”
We note the following rules of statutory construction:
1. The intent of the legislature governs.
2. In determining legislative intent, we are not limited to consideration of the language used in the statute. We may look to historical background, the circumstances attending its passage, the purpose to be accomplished, and the effect the statute may have under the various constructions suggested. Citizens State Bank of Grainfield v. Kaiser, 12 Kan. App. 2d 530, 536, 750 P.2d 422, rev. denied 243 Kan. 777 (1988). But see Joe Self Chevrolet, Inc. v. Board of Sedgwick County Comm'rs, 247 Kan. 625, 633, 802 P.2d 1231 (1990) (Rules do not permit courts to read into a statute something that does not come within the wording of the statute.).
3. When construing a statute, we should give words in common usage their natural and ordinary meaning. Hill v. Hill, 13 Kan. App. 2d 107, 108, 763 P.2d 640 (1988).
K.S.A. 26-509 was last amended in 1972. The few decisions construing the statute do not address this issue.
By the clear terms of the statute, the landowner may be allowed attorney fees only if the jury renders a verdict in an amount greater than the appraisers’ award. However, we reason that to differentiate between a jury trial and a trial to the court, in the attorney fees context, does not have the support of policy or logic. We hold that the legislature did not intend to limit the landowner’s award of attorney fees to jury trials. We focus on the purpose of the statute — to compensate the landowner for defending against the condemner’s appeal. Attorney fees may be awarded to a landowner under K.S.A. 26-509 if, in a bench trial resulting from an appeal by the condemner, the judgment for the landowner is in an amount greater than the appraisers’ award.
The Attorney Fees Award
Finally, the County argues the award of attorney fees was excessive and that the trial court abused its discretion in not following the guidelines of MRPC 1.5 (1991 Kan. Ct. R. Annot. 236).
Clark argues that the trial court’s award is reasonable and within the range of normal contingent fee contracts between landowners and condemners in condemnation cases. Clark further asserts the determination of the reasonable value of attorney fees is within the discretion of the trial court and will not be disturbed absent an abuse of discretion. State Farm Fire & Cas. Co. v. Liggett, 236 Kan. 120, Syl. ¶ 6, 689 P.2d 1187 (1984).
Usually, a trial court may not consider a contingent fee contract in determining the amount of attorney fees to be awarded a litigant. Wolf v. Mutual Benefit Health & Accident Association, 188 Kan. 694, 714, 366 P.2d 219 (1961). However, there is an exception in eminent domain cases. The trial court may consider contingent fee contracts in awarding attorney fees under K.S.A. 26-509. City of Wichita v. Chapman, 214 Kan. 575, 587, 521 P.2d 589 (1974). See Kansas Benchbook 130 (1983 Supp.).
We agree that the determination of a reasonable fee in the case at bar is within the discretion of the trial court if a fee is to be awarded. We have vacated the judgment for attorney fees and remanded for additional testimony to be presented to the trial court concerning market value and highest and best use. If, after consideration of all the evidence, i.e., the record resulting in the judgments we have vacated and the testimony we have ordered to be heard on remand, the trial court finds for Clark in an amount greater than the appraisers’ award, the trial court may allow Clark attorney fees under K.S.A. 26-509.
Judgment is vacated and the case remanded.
Holmes, C.J., not participating.
James M. Macnish, Jr., district judge, assigned. | [
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Per Curiam,-.
This is an original proceeding in discipline filed by the office of the disciplinary administrator against William T. Lewis, Jr., of Springfield, Illinois, an attorney licensed to practice law in the State of Kansas.
William T. Lewis, Jr., a resident of Springfield, Illinois, was admitted to the practice of law in Kansas on the 24th day of June, 1964, and has been actively engaged in the practice of law in the State of Illinois.
On the 4th day of October, 1990, William T. Lewis, Jr., was disbarred from the practice of law in the State of Illinois, and his name stricken from the roll of attorneys in that state for numerous acts of ethical misconduct as is fully reflected in In re Lewis, 138 Ill. 2d 310, 562 N.E.2d 198 (1990).
The allegations made against William T. Lewis, Jr., in the disciplinary proceedings in the State of Illinois would constitute good cause for disbarment in the State of Kansas. Supreme Court Rule 202 (1991 Kan. Ct. R. Annot. 142) provides, in pertinent part: “A final adjudication in another jurisdiction that a lawyer has been guilty of misconduct shall establish conclusively the misconduct for purposes of a disciplinary proceeding in this state.”
On the 21st day of October, 1991, a formal complaint was filed by the disciplinary administrator of the State of Kansas, and respondent was duly notified that the complaint would be heard on August 27, 1991, in the Office of Judicial Administration Conference Room, Kansas Judicial Center, Topeka, Kansas.
The respondent failed to appear, and the hearing panel, having considered evidence, recommended that William T. Lewis, Jr., be disbarred.
On the 10th day of December, 1991, this court issued an order for William T. Lewis, Jr., to appear on January 17, 1992, at 9:30 a.m., to show cause why he should not be disbarred in the State of Kansas. Notice of said order was duly served upon William T. Lewis, Jr., by United States Mail, postage prepaid, certified, return receipt mail. He failed to appear before this court as ordered.
Now, Therefore, It Is Ordered that William T. Lewis, Jr., be, and he is hereby, disbarred from the practice of law in the State of Kansas, that his privilege to practice law in the State of Kansas is hereby revoked, and that the Clerk of the Appellate Courts of Kansas strike the name of William T. Lewis, Jr., from the roll of attorneys in the State of Kansas.
It Is Further Ordered that the certificate of William T. Lewis, Jr., to practice law in the State of Kansas is hereby can-celled and declared null and void, and William T. Lewis, Jr., shall forthwith forward, or cause to be forwarded, to the Clerk of the Appellate Courts his certificate of admission to practice law in the State of Kansas.
It Is Further Ordered that this order shall be published in the official Kansas Reports, that the costs herein are assessed to the respondent, and that the respondent shall forthwith comply with Supreme Court Rule 218 (1991 Kan. Ct. R. Annot. 163).
Effective this 28th day of February, 1992. | [
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The opinion of the court was delivered by
HOLMES, C.J.:
Diane E. Sadecki, the original petitioner in an action for divorce from Raymond M. Sadecki, timely appealed from the division of property ordered by the trial court. The Court of Appeals, in a two-to-one decision, affirmed the trial court in an unpublished opinion, In re Marriage of Sadecki, No. 64,945 filed April 19, 1991. We granted a petition for review filed by Diane and now affirm the decisions of the trial court and the Court of Appeals.
The appellant contends that the trial court erred in (1) making a grossly inequitable division of property; (2) failing to consider Raymond’s retirement pension as a marital asset subject to di vision; and (3) failing to consider Raymond’s future earning capacity. The facts will be set forth in some detail.
Diane and Raymond Sadecki were married in 1960. Diane filed for divorce in February of 1989. The trial court granted the divorce October 4, 1989. At the time of the marriage, Diane was 18 years old and Raymond was Í9 years old. Raymond had been a major league professional baseball player for 2 years and continued to play professional baseball for the next 18 years of their marriage. The Sadeckis had two children, one born in 1966, the other in 1970.
During the first 20 years of their marriage, Diane had no significant employment outside the home and spent those years of the marriage as a housewife and full-time mother of two children. In 1981, Diane went to work full time for Gerber Products Company.
Raymond retired from baseball in 1977, and in 1986, at the earliest possible opportunity, exercised his right to begin drawing retirement benefits from the professional baseball retirement program. The retirement program is a non-contributory, vested, matured pension which at the time of the divorce paid Raymond $1,919 per month. Although he will continue to receive monthly payments for life, the amount of the payment apparently fluctuates, depending upon market conditions and the economy.
At the divorce hearing, both parties testified about their marital assets and their respective financial conditions. Raymond testified to his ownership of a limited partnership interest in a fast food operation known as “BK’s.” He valued the interest at $31,750 and stated his income from the partnership was $13,231 in 1988. No evidence was presented by either party as to the present cash value of Raymond’s baseball retirement benefits. With the exception of their household goods, the parties were generally in agreement about the value of their other property. Diane thought the household goods were worth only $1,500 while Raymond placed a value of $5,000 on them.
At the time of the hearing, Diane was earning approximately $30,000 per yéar from her employment at Gerber Products Company. Raymond was unemployed and had last Worked for Southwestern Bell selling mobile phones. He testified that he had “been active in the job market,” but had failed to secure new employment. Overall, Raymond was unemployed for approximately 17 months of the 2-year period preceding the divorce hearing. In 1988, Raymond’s adjusted gross income was approximately $40,269, which included $4,700 from the sales job with Southwestern Bell, and the balance in passive income from the baseball retirement plan and the limited partnership. In 1986 he had earned $33,480 and in 1987 he eaméd $23,000. His employment with Southwestern Bell was terminated in September 1987.
After hearing all of the evidence, the trial court divided the property by awarding Diane the residence valued at $65,000, the bulk of the household goods, her 401K retirement plan with Gerber Products Company, her IRA account, and a checking account of approximately $1,000. In addition, she was granted a money judgment ágainst Raymond of $8,500. The total value of the property and judgment exceeded $90,000.
The trial court awarded a small portion of the household goods to Raymond, along with his 1986 Chrysler automobile and his limited partnership interest in “BK’s,” all of which had a total value of approximately $40,000. In addition, Raymond was ordered to pay all of the indebtedness of the parties, including two mortgages on the residence and one on the automobile, in the total amount of $24,050, as well as the judgment granted to Diane. The net value of the property granted to Raymond, after deduction of the indebtedness and judgment, was $7,950.
Before turning to the issues raised by the áppellant, we deem it appropriate to review certain basic principles and statutes applicable to a claim of an inequitable property division in a divorce case.
K.S.A. 1990 Supp. 60-1610(b) governs the division of property in divorce proceedings and provides in pertinent part:
“(1) Division of Property. The decree shall divide the real and personal property of the parties, whether owned by either spouse prior to marriage, acquired by either spouse in the spouse’s own right after marriage or acquired by the spouses’ joint efforts, by: (A) a division of the property in kind; (B) awarding the property or part of the property to one of the spouses and requiring the other to pay a just and proper sum; or (C) ordering a sale of the property, under conditions prescribed by the court, and dividing the proceeds of the sale. In making the division of property the court shall consider the age of the parties; the duration of the marriage; the property owned by the parties; their present and future earning capacities; the time, source and manner of acquisition of property; family ties and obligations; the allowance of maintenance or lack thereof; dissipation of assets; and such other factors as the court considers necessary to make a just and reasonable division of property.”
“Marital property” is defined in K.S.A. 23-201(b) as follows:
“All property owned by married persons, including the present value of any vested or unvested military retirement pay, whether described in subsection (a) or acquired by either spouse after marriage, and whether held individually or by the spouses in some form of co-ownership, such as joint tenancy or tenancy in common, shall become marital property at the time of commencement by one spouse against the other of an action in which a final decree is entered for divorce, separate maintenance, or annulment. Each spouse has a common ownership in marital property which vests at the time of commencement of such action, the extent of the vested interest to be determined and finalized by the court, pursuant to K.S.A. 60-1610 and amendments thereto.”
The rules of appellate review governing the division of property in a divorce proceeding are well settled:
“In a divorce action the district court is vested with broad discretion in adjusting property rights, and its exercise of that discretion will not be disturbed on appeal absent a clear showing of abuse.” [Citations omitted.] “[Discretion is abused only where no reasonable [person] would take the view adopted by the trial court. If reasonable [persons] could differ as to the propriety of the action taken by the trial court then it cannot be said that the trial court abused its discretion.” ’ ” Reich v. Reich, 235 Kan. 339, 341, 680 P.2d 545 (1984) (quoting Bohl v. Bohl, 232 Kan. 557, 561, 657 P.2d 1106 (1983).
In Stayton v. Stayton, 211 Kan. 560, 561-62, 506 P.2d 1172 (1973), we stated:
“The discretion of the trial court is, of course, subject to appellate review and correction where there has been a clear-cut abuse of discretion. In its exercise a judge may not be arbitrary or whimsical. We have held on a number of occasions that abuse of judicial discretion, as that term is ordinarily used, implied not merely an error in judgment, but perversity of will, passion or moral delinquency when such discretion is exercised to an end or purpose not justified by and clearly against, reason and evidence.”
Further, the trial court in its exercise of discretion in dividing the property is not required to divide the property on a 50-50 basis. In Larue v. Larue, 216 Kan. 242, 250, 531 P.2d 84 (1975), this court stated: “Nowhere in any of our decisions is it suggested that a division of all of the property of the parties must be an equal division in order to be just and reasonable . . . .”
Diane, in asserting that the property division constitutes an abuse of discretion on the part of the trial court, makes several arguments which are commingled in her brief. However, her principal allegation is that the court erred in not considering the baseball retirement plan as a marital asset subject to division. She contends that it was only considered as an income item in comparing the relative incomes of the parties and not as a marital asset. Raymond, on the other hand, asserts that there was no evidence of the value of the retirement plan and that the trial court did consider the plan as a marital asset.
At the outset, it should be noted that if Diane’s argument is correct then she received assets having a net value in excess of $90,000, while Raymond received assets having a net value of less than $8,000. Such a construction of the trial court’s judgment results in. Diane receiving over 11 times more in net marital assets than Raymond, which arguably Raymond might view as an abuse of discretion, but certainly not Diane. Diane’s argument is unrealistic when the entire record, such as it is, and the statements of the court are considered in their entirety. A review of that record reveals both the limited partnership interest in “BK’s” and the baseball retirement plan were considered as assets.
Diane bases her argument primarily on certain isolated statements of the trial court where it referred to the retirement benefits as income rather than as a marital asset. However, such reliance is based upon statements taken out of context. In stating its findings and orders on the division of property, the court went to great lengths to describe each asset and debt of the parties and in'doing so stated: “The husband is also set aside his baseball retirement income free and clear of any claim of the wife.” It is apparently this statement that Diane seizes upon when she claims in her brief that, “At the time of the original judgment, the Court merely referred to it [the baseball retirement plan] as ‘income.’ ” However, she chooses to ignore the court’s closing words wherein it stated:
“By my estimation I have given assets to the wife in the amount of $89,000. I have given assets to the husband, after the deduction for the debt service that I’ve, ordered him to assume, in the amount of $20,000. [An actual calculation of the values reflect the approximate figures of $90,000 and $8,000 as recited elsewhere in this opinion.] I think that this disparity and the division of the property adequately compensate the wife for the contribution she made toward the creation of the asset which is the baseball retirement,” (Emphasis added.)
Thus, it appears clear that the trial court not only recognized the baseball retirement plan as an asset but specifically considered it as such in making the division of property. The reference to the monthly retirement payments as income, or as wages in some of the documents, only came about because Raymond was already receiving his monthly retirement benefits and does not indicate that the court failed to consider the overall retirement plan as an asset subject to division. To the contrary, his specific statements were that the baseball retirement plan was an “asset” taken into consideration in the division of property.
The majority of the Court of Appeals reached the same conclusion, stating:
“Our reading of the record leads us to conclude that the trial court did not abuse its discretion in dividing the property. This conclusion is based principally upon two factors: (1) To obtain a reversal, it is an appellant’s obligation to present a record which clearly shows abuse of discretion. Diane, by not having presented evidence establishing a value for Ray’s baseball pension benefits entitlement or interest to the trial court, is disabled from presenting such a record on appeal. (2) The trial court’s division of assets, with Diane’s receiving property having a value approximately 11 times the net value of the property set over to Ray, leads us to conclude that not only did the trial court consider the pension plan as an asset, but gave some weight to it in dividing the property.”
As a further argument that the court gave improper consideration to the baseball retirement plan, Diane contends that the court’s award of the pension benefits in full to Raymond cannot be adequately offset by an award of other marital property to Diane. Diane argues that as the trial court could not properly use the “present cash value/setoff scheme” to effect the distribution of property, it should have employed the “reserve jurisdiction” method to divide the proceeds of the retirement plan.
Under the “present cash value/immediate offset” distribution scheme, the court, based upon evidence submitted, assigns a present value to the retirement benefits, awards the pension in full to the employee spouse, and awards other marital property (or a note) of offsetting value to the other spouse. Under the “reserve jurisdiction” method, the court retains jurisdiction and divides the pension benefits between the parties if and when the pension is paid or awards a fixed percentage of all future payments to the non-pensioned spouse.
In In re Harrison, 13 Kan. App. 2d 313, 316, 769 P.2d 678 (1989), the Court of Appeals described and approved both approaches to distribution. Some states have specifically stated a preference for either the reserve jurisdiction method (see Mitchell v. Mitchell, 4 Va. App. 113, 120-21, 355 S.E.2d 18 [1987] [deferred distribution required by statute]; In re Marriage of Steinke v. Steinke, 126 Wis. 2d 372, 385, 376 N.W.2d 839 [1985]) or the present cash value/immediate offset method (see Rask v. Rask, 445 N.W.2d 849, 852 [Minn. App. 1989]; Moore v. Moore, 114 N.J. 147, 162, 553 A.2d 20 [1989]). However, Kansas has found neither method to be preferred as a matter of law. See In re Harrison, 13 Kan. App. 2d at 317.
To effect an equitable distribution using the present cash value/ immediate offset method, the trial court awards the non-pensioned spouse marital property of comparable value to the present value of the pension. To do so, however, there must be evidence of the present value of the pension benefits. If the value of the pension exceeds the value of the other marital assets to the extent that the non-pensioned spouse cannot be adequately compensated under the present cash value method, then the trial court “reserves jurisdiction” and divides the pension when it is paid.
In the instant case, Diane did not present any evidence of the present value of the baseball retirement benefits. In Harrison, the wife presented expert testimony of a professor of finance, who calculated the present value of the benefits based upon actuarial tables. This figure was then adjusted for inflation and discounted by a historic rate of interest. 13 Kan. App. 2d at 314.
Here, without any evidence of the present value of the pension, it may be argued that the trial court was not able to accurately set aside other marital property of comparable value to Diane. Likewise, without such evidence the trial court was unable to determine if the value of the marital assets awarded to Diane fell short of the value of the pension so as to properly invoke the reserve, jurisdiction method.
However, the burden is upon the appellant to furnish sufficient evidence to the trial court and to designate a record sufficient to present her points to the appellate court to establish the claimed error. State ex rel. Ludwick v. Bryant, 237 Kan. 47, Syl. ¶ 6, 697 P.2d 858 (1985). See Beaty v. Beaty, 167 Mich. App. 553, 557, 423 N.W.2d 262 (1988) (a husband’s non-contributory pension does not have to be divided in the absence of any showing by the wife as to its present value); Miller v. Miller, 83 Mich. App. 672, 675, 269 N.W.2d 264, 266 (1978) (party seeking to include pension interest in marital estate for purposes of distribution in divorce proceedings bears burden of proving reasonably ascertainable value, and if burden is not met, interest should not be considered as asset subject to distribution); but see, In re Marriage of Steinke v. Steinke, 126 Wis. at 383 (trial court must evaluate and include the pension interest in the property division whether or not the parties present evidence on its value).
Unless the court abused its discretion in not adopting the reserve jurisdiction approach to the baseball retirement asset, Diane cannot complain about the division of property because she failed to establish any present value of the retirement benefits. Without any evidence of the value of the pension plan the trial court’s method of considering the pension plan in its division of the property cannot be said to be an abuse of discretion.
Diane further complains that the court erred in adopting what she terms the “clean break” rationale. At a hearing on a motion for reconsideration, the trial court stated in part:
“I want to say, basically, first off, you try the cases the way you find them the day they come into the court. . . . And I gave you my best effort at the time we tried the case and I don’t know that I’ve divided everything 50-50, but I’ve come as close as I know how to come under these circumstances. And I don’t think that partitioning things 50-50 necessarily means just taking every asset and saying, ‘You own 50-50.’ That doesn’t allow the parties to make a break. And what I’ve done, I think, allows the parties to put this litigation behind them. And if they don’t want to be married anymore, then they don’t have to see each other anymore. And as soon as Mr. Sadecki pays off these bills and the $8,500.00 judgment I gave his wife as further division of property, then this case is over and they don’t ever have to talk to each other again, whereas if we start dividing up ongoing sources of income like baseball pension and the Sonic Burger, then they’re tied together forever. So whether it’s right or whether it’s wrong, the decision I made on August 24th is the one that I’m happy with, and that’s going to be the decision of the Court. Motion to Reconsider is overruled.”
Diane argues that the court erred in justifying the award of the pension plan and limited partnership to Raymond on the theory of a “clean break.” She asserts in her brief, “The Court found that accomplishing a ‘clean break’ is more important than trying to accomplish a 50-50 division of assets.” This argument is without merit. First, Kansas does not require courts to divide property 50-50. LaRue, 216 Kan. at 250. Second, it is not only within the trial court’s discretion, but perhaps within the court’s wisdom, to choose not to divide ongoing sources of income. As a general rule, the goal of the divorce court is to divide property in such a way as to avoid ongoing financial interaction between the parties. See, e.g., Simmons v. Simmons, 87 Ill. App. 3d 651, 656, 409 N.E.2d 321 (1980). It is not unreasonable for a court to attempt to disentangle the parties’ economic partnership so as to achieve a conclusion and finality to their marriage, and in most cases such a goal is to be commended. See Hoyt v. Hoyt, 53 Ohio St. 3d 177, 182-83, 559 N.E.2d 1292 (1990) (regarding distribution of retirement benefits).
Based upon the record before this court and considering our scope of review, we cannot say the trial court abused its discretion in the manner in which it considered Raymond’s baseball retirement plan in arriving at the property division.
The final issue Diane raises on appeal is that the trial court erred by failing to consider the parties’ future earning capacities as required by K.S.A. 1990 Supp. 60-1610(b). The statute provides in pertinent part: “In making the division of property, the court shall consider the age of the parties; the duration of the marriage; the property owned by the parties; their present and future earning capacities . . . .” (Emphasis added.)
Diane contends that the trial court’s duty to consider future earning capacity is mandatory and that the court in dividing the assets looked only to the fact that Raymond was unemployed at the time of the divorce and had no prospects for a job at that time.
On appeal, the trial court’s weighing of the statutory factors regarding distribution of property upon divorce will be governed by an abuse of discretion standard. Ruth v. Ruth, 316 Pa. Super. 282, 286, 462 A.2d 1351 (1983).
Based upon the record before us, we cannot conclude that the trial court abused its discretion. While Raymond had been successful as a salesman during various periods following his retirement from professional baseball, his last productive employment had been terminated by his employer, Southwestern Bell, and he had been unemployed for approximately 17 months of the 2-year period preceding the divorce hearing. Raymond testified he had been unsuccessful in obtaining employment even though he had been actively seeking it. There was no testimony or evidence that he was intentionally avoiding employment and there was no evidence of any immediate prospects of gainful employment. The court found that Raymond “doesn’t have a job and he doesn’t have any prospects for a job.” Assuming Raymond remained unemployed, the property division would result in Raymond and Diane receiving a similar level of yearly income. The record reflects that the court not only heard evidence of Raymond’s past earning capacity, but also considered his record of unemployment and the lack of any evidence of future prospects for employment.
After considering all of the various arguments asserted by Diane, we cannot conclude that the trial court abused its discretion in the division of property in this divorce action.
The judgments of the Court of Appeals and the District Court are affirmed. | [
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The opinion of the court was delivered by
Herd, J.:
In this criminal action, Cencil O’Neal was charged with perjury, K.S.A. 1990 Supp. 21-3805. At the preliminary hearing, the district court dismissed the charge against O’Neal, finding the military officer who had taken O’Neal’s statement was acting outside his authority as a notary public. The State appeals the district court’s decision.
Cencil O’Neal was charged with perjury based upon a statement made on January 8, 1991, to an army officer. On February 25, 1991, at the preliminary, hearing, the issue of whether the officer had the authority as a notary to take a sworn statement from a civilian was raised. The parties stipulated to the following facts.
O’Neal is not in the military. The charge against him, however, arises out of a statement he gave to Christian D. Marsh, a military police officer investigator. Marsh was investigating an incident that occurred at least in part at Ft. Riley. O’Neal’s statement was not made at Ft. Riley. Marsh’s authority for administering the oath is Article 136(b)(4) of the Uniform Code of Military Justice (U.C.M.J.). This statute is codified at 10 U.S.C. § 936 (1988).
After hearing the parties’ arguments, the district court determined that the restrictions that apply to persons authorized to act as notaries under 10 U.S.C. § 936(a) (1988) also apply to those persons authorized to act as notaries under 10 U.S.C. § 936(b). The district court then found that under the U.C.M.J. an investigating military officer does have the authority to administer oaths for the purpose of military administration and military justice. Investigating military officers also have the general powers of a notary public. The district court, however, found that pursuant to § 936(a), this notarial authority applied only to acts executed by members of the armed forces or employed by or accompanying the armed forces outside the United States; thus, the oath made by O’Neal to Marsh did not qualify as an oath under Kansas law. The district court, therefore, dismissed the case against O’Neal.
The sole issue on appeal is whether Marsh as an investigating military officer had the authority as a notary to administer the oath and take a sworn statement from O’Neal, a civilian not associated with the military, while off-post.
First, let us look at the definition of perjury.' K.S.A. 1990 Supp. 21-3805 states in pertinent part:
“(a) Perjury is willfully, knowingly and falsely swearing, testifying, affirming, declaring or subscribing to any material fact upon any oath or affirmation legally administered in any cause, matter or proceeding before any court, tribunal, public body, notary public or other officer authorized to. administer oaths.” (Emphasis added.)
The office of notary public is not a new creation. It began in the early Roman state and existed in England long before the Norman Conquest. The notary public originated under the law merchant, and the notary’s duties were limited to those that arose in the dealings of merchants. “Administering of oaths and taking of affidavits is not one of the common-law powers of a notary but is conferred only by legislative enactment. Its existence cannot be presumed.” Kumpe v. Gee, 187 S.W.2d 932, 934 (Tex. Civ. App. 1945).
The parties stipulated to the fact that Marsh is authorized to administer oaths and to act as notary pursuant to U.C.M.J. Art. 136(b)(4). The current version of Article 136 states:
“(a) The following persons on active duty or performing inactive-duty training may administer oaths for the purposes of military administration, including military justice:
(1) All judge advocates.
(2) All summary courts-martial.
(3) All adjutants, assistant adjutants, acting adjutants, and personnel adjutants.
(4) All commanding officers of the Navy, Marine Corps, and Coast Guard.
(5) All staff judge advocates and legal officers, and acting or assistant staff judge advocates and legal officers.
(6) All other persons designated by regulations of the armed forces or by statute.
“(b) The following persons on active duty or performing inactive-duty training may administer oaths necessary in the performance of their duties-.
(1) The president, military judge, trial counsel, and assistant trial counsel for all general and special courts-martial.
(2) The president and the counsel for the court of any court inquiry.
(3) All officers designated to take a deposition.
(4) All persons detailed to conduct an investigation.
(5) All recruiting officers.
(6) All other persons designated by regulations of the armed forces or by statute.” 10 U.S.C. § 936 (1988 & Supp. II 1990). (Emphasis added.)
It is apparent the district court as well as the parties relied upon the statute’s language as it appeared prior to amendments made in 1990. Prior to these amendments 10 U.S.C. § 936(a) stated:
“The following persons on active duty may administer oaths for the purposes of military administration, including military justice, and have the general powers of a notary public and of a consul of the United States, in the performance of all notarial acts to be executed by members of any of the armed forces, wherever they may be, by persons serving with, employed by, or accompanying the armed forces outside the United States and outside the Canal Zone, Puerto Rico, Guam and the Virgin Islands, and by other persons subject to this chapter outside the United States-. . . . .” (Emphasis added.)
Because the restrictive language of subsection (a) was no longer in force when O’Neal made his statement to Marsh, we need not determine whether the restrictive language also applied to subsection (b). Based upon the facts stipulated to by the parties, we find Marsh was authorized by federal statute to act as a notary.
The parties argue over whether Marsh’s authority as a notary extends to notarial acts performed off federal property. To answer this question, we must look to Kansas law because a notary public performs acts “by virtue of the local, and not the foreign, authority, and this rule applies to authority which may be extended by the Federal Government.” Kumpe, 187 S.W.2d at 934.
In 1984 Kansas adopted the Uniform Law on Notarial Acts, K.S.A. 1990 Supp. 53-501 et seq., and repealed the Uniform Recognition of Acknowledgments Act, K.S.A. 53-301 et seq. The Uniform Law on Notarial Acts, 14 U.L.A. 125 et seq. (1990), has also been adopted by six other states and “seeks to simplify and clarify proof of the authority of notarial officers.” 14 U.L.A. 125. Section 5 of the Uniform Law on Notarial Acts governs the effect of notarial acts that are performed under federal authority. Section 5 is codified at K.S.A. 1990 Supp. 53-506, which states:
“(a) A notarial act has the same effect under the law of this state as if performed by a notarial officer of this state if performed anywhere by any of the following persons under authority granted by the law of the United States:
“(1) A judge, clerk, or deputy clerk of a court;
“(2) a commissioned officer on active duty in the military service of the United States;
“(3) an officer of the foreign service or consular officer of the United States; or
“(4) any other person authorized by federal law to perform notarial acts.
“(b) The signature and title of a person performing a notarial act are prima facie evidence that the signature is genuine and that the person holds the designated title.
“(c) the signature and indicated title of an officer listed in subsection (a)(1), (a)(2) or (a)(3) conclusively establish the authority of a holder of that title to perform a notarial act.”
The State claims K.S.A. 1990 Supp. 53-506(a)(2) or (a)(4) authorizes Marsh to act as a notary in the State of Kansas. In response, O’Neal first argues the State cannot rely upon K.S.A. 53-501 et seq. because the State did not cite it during the preliminary hearing before the district court. We do not agree.
At the preliminary hearing, the district court judge concluded by stating:
“This man [O’Neal], not being in the United States army, not being employed by the United States army outside the United States, Court finds that that does not qualify as an oath as intended by the laws of the State of Kansas for the purpose of constituting the crime of perjury.”
The only issue considered at the preliminary hearing was whether Marsh had the authority to act as a notary under the laws of the State of Kansas. It is true litigants must preserve an issue before the trial court in order to raise that issue on appeal. Schmeck v. City of Shawnee, 232 Kan. 11, 35, 651 P.2d 585 (1982). Litigants, however, do not have to use the same authorities in their appellate briefs as they used before the district court.
Next, O’Neal contends the State can claim Marsh has notarial authority under K.S.A. 1990 Supp. 53-506(a)(2) only because (a)(2) deals specifically with military personnel. O’Neal further claims the State failed to present any evidence before the district court proving Marsh was “a commissioned officer on active duty.” At the preliminary hearing, O’Neal stipulated that Marsh was authorized by federal law to perform notarial acts. As long as Marsh meets the requirements of any of the four provisions of K.S.A. 1990 Supp. 53-506(a), the statement by O’Neal which Marsh notarized has the same effect as if the statement had been notarized by a notarial officer of this state. We, therefore, find that Marsh was authorized to perform notarial acts within the State of Kansas in accordance with K.S.A. 1990 Supp. 53-506(a)(4).
Finally, O’Neal argues Marsh did not comply with K.S.A. 1990 Supp. 53-508, which requires a notarial act to “be evidenced by a certificate signed and dated by a notarial officer.” K.S.A. 1990 Supp. 53-508, which describes what a certificate must include as well as what form a certificate of a notarial act may take. The sworn statement made by O’Neal is not a part of the record on appeal. Thus, we cannot determine whether Marsh complied with K.S.A. 1990 Supp. 53-508. The district court must consider this question on remand.
The district court’s decision is reversed and the case is remanded for further proceedings. | [
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Per Curiam:
J.W.S. appeals his jury trial adjudication as a offender for (K.S.A. 1990 Supp. 21-3401) of his stepfather, Larry Sauer.
Larry Sauer, a resident on 1989. The last persons known to have seen him were respondent, and David Benton Malone. Malone, age 16 at the time of trial, was a high school friend of respondent who was living in the Sauer residence at the time of the disappearance of Larry Sauer. Both boys told essentially the same story to the investigating officers. That story was that after school on the day in question, Larry Sauer took them to Cessna Park to watch the jet planes take off and land. Larry Sauer left them for an hour and then returned. At that time, he gave his van keys to respondent, stating the boys should drive home. He further stated he had some errands to do and would walk home after their completion. This was the last the boys saw of him.
Sauer’s body was in on 1989. He had been shot three times with a shotgun. The two became the focus of the investigation and were ultimately charged with the Sauer murder. Additional facts will be set forth necessary for the determination of particular issues.
AIDING AND ABETTING
Respondent contends there was the jury verdict that he was an aider and abettor in the first-degree murder of his stepfather. When the sufficiency of the evidence is challenged, the standard of review on appeal is whether, after review of all the evidence, viewed in the light most favorable to the prosecution, the appellate court is convinced that a rational factfinder could have found the defendant guilty beyond a reasonable doubt. State v. Graham, 247 Kan. 388, Syl. ¶ 5, 799 P.2d 1003 (1990). This same standard applies in the review of juvenile offender adjudications.
K.S.A. 1990 Supp. 21-3205 provides:
“(1) A person is criminally responsible for a crime committed by another if such person intentionally aids, abets, advises, hires, counsels, or procures the other to commit the crime.
“(3) A person liable under this section may be charged with and convicted of the crime although the person alleged to have directly committed the act constituting the crime . . . has not been convicted or has been acquitted or has been convicted of some other degree of the crime or of some other crime based on the same act.”
Some additional facts are necessary for the discussion of this issue. Both respondent and Malone were charged with being juvenile offenders based upon first-degree murder. Prior to respondent’s trial, Malone abandoned the Cessna Park story and stated that Sauer had been killed while he, respondent, and Sauer had been out in the county practicing shooting. He stated respondent had shot Sauer, and the two boys had planned the matter in advance. Malone further testified that the two boys worked in concert to hide the body. There were a number of inconsistencies in his story (this will be discussed in more detail in connection with a subsequent issue). Malone pled guilty to aiding and abetting the first-degree murder. Respondent went to trial upon allegations of first-degree murder. Malone testified for the State that respondent had killed Sauer with premeditation. Respondent took the stand and, for the first time, recanted the Cessna Park story. He denied planning his stepfather’s death. Rather, he testified Malone accidentally shot Sauer in the leg and then finished him off with two more shots. Respondent testified he assisted Malone in hiding the body out of his fear of Malone. Based upon this new version, the State moved for and was permitted to amend its information to charge aiding and abetting first-degree murder as an alternative charge.
position there was no evidence he aided and abetted in the death of Sauer. If Malone is believed, respondent was the principal; If respondent’s version is believed, then he was guilty of no crime. This rationale is faulty. The jury not required to accept, in toto, either version. See State v. Lashley, 233 Kan. 620, 628, 664 P.2d 1358 (1983). Under the evidence the jury could, and apparently did, find that the boys planned the murder, that Malone did the actual shooting, and respondent was an active participant in the murder.
As an offshoot to this issue, having accepted Malone as an aider and abettor in the crime, cannot charge respondent as an aider and abettor. Respondent concedes that an aiding and abetting conviction is valid even if alleged principal is acquitted or convicted of a lesser charge. State v. Norwood, 217 Kan. 150, 157, 535 P.2d 996 (1975). the case herein, only three people actually knew what transpired at the murder scene. Larry Sauer is dead, and Malone said respondent did it. At respondent’s trial, a second version surfaced through respondent’s testimony — that Malone was the slayer of Sauer.
Under respondent’s theory, once two codefendants to plead guilty to aiding and abetting, then is locked into proving the second defendant is the principal. it fails to prove the same, then the second defendant must be acquitted. In support of this novel argument, respondent cites United States ex rel. Di Giangiemo v. Regan, 528 F.2d 1262 (2d Cir. 1975), which concerned whether the prosecution was es-topped from introducing evidence which had been suppressed in prior prosecution. This case has no relevance herein. Respondent also cites United States v. Martin, 747 F.2d 1404 (11th Cir. 1984), which involves what amounts to a one-person crime. In order to have been found guilty of aiding and abetting, the defendant would have to have aided and abetted himself. This was held to be a legal impossibility. This is analogous to the situation in our State v. Doyen, 224 Kan. 482, 580 P.2d 1351 (1978). In Doyen there was no principal as such. The only wrongdoer was allegedly Doyen himself. Hence he could not be convicted as an aider and abettor. We find no merit in the estoppel argument.
VENUE
Respondent challenges venue being in Butler County when evidence introduced at trial established the slaying occurred in Sedgwick County.
Additional facts are necessary to The Sedgwick-Butler county line runs roughly down the center of 159th Street East in the area in question. Both eyewitnesses (respondent and Malone) testified Sauer was shot on the Sedgwick County side of the road and dragged over to the Butler County side. This was corroborated by some physical evidence at the scene. Hence, respondent argues proper venue could only have been in Sedgwick County. The applicable statutes, as argued by the parties, are as follows:
K.S.A. 22-2602:
“Except as otherwise provided by law, the prosecution shall be in the county where the crime was committed.”
K.S.A. 22-2603:
“Where two or more acts are requisite to the commission of any crime and such acts occur in different counties the prosecution may be in any county in which any of such acts occur.”
K.S.A. 22-2604:
“Where a crime is committed on or so near the boundary of two or more counties that it cannot be readily determined in which county the crime was committed, the prosecution may be in any of such counties.”
K.S.A. 22-2611:
“If the cause of death is inflicted in one county and the death ensues in another county, the prosecution may be in either of such counties. Death shall be presumed to have occurred in the county where the body of the victim is found.”
The body was found a few feet inside Butler County. Was the presumption set forth in K.S.A. 22-2611 overcome? We believe not.
Dr. William Eckert testified that the victim would have died within two to three minutes after infliction of the neck wound. The neck wound was the fatal shot. Both eyewitnesses testified this was the last shot fired. Immediately thereafter they dragged Sauer the few feet it took to get into Butler County. Under the pathologist’s testimony, death could well have occurred in Butler County. By virtue of this determination, we need not discuss the application of K.S.A. 22-2602, 22-2603 or 22-2604.
note venue was questioned for the first time on appeal. We find no merit in this issue.
our of the venue issue, reference needs to be made to a statute not cited by the parties. K.S.A. 38-1605(a) provides:
“Venue for adjudicatory proceedings in any case involving an alleged juvenile offender shall be in any county where any act of the alleged offense was committed.”
Our preceding statements relative to the movement of the victim into Butler County immediately after the firing of the fatal shot would also satisfy the venue requirements of K.S.A. 38-1605(a).
LIMITATION OF EXPERT TESTIMONY
suffered from a mental illness which often had lying as a characteristic. Some background on how this evidence became available needs to be included. Retween the time of the murder and the discovery of the body, Mrs. Sauer became concerned over Malone’s behavior. He was living in the Sauer home and was not attending school, and she belieyed he had run away from home. Malone was taken into custody and placed in a mental hospital for evaluátion. He was ultimately diagnosed as having á conduct disorder which was socialized and severe. Respondent sought to introduce testimony relative to the diagnostic criteria for this disorder as contained in DSM-III-R (Diagnostic and Statistical Mental Disorders 55-56 [3d ed. rev. 1981]). These criteria are as follows:
“Diagnostic criteria for Conduct Disorder
A least three of the following have been present:
(1) has stolen without confrontation a victim on more one occasion (including forgery)
(2) has run away from home overnight at twice parental or parental surrogate home (or once without returning)
often lies (other than to or
(4) has deliberately engaged in fire-setting
(5) is often truant from school (for older person,
has into someone
(7) has deliberately setting)
(8) hás been physically cruel to animals
(9) has forced someone
(10) has used a weapon in more than one fight
(11) often initiates physical fights
(12) snatching, extortion, armed robbery)
(13) has been physically cruel to people
Note: The above items are in power based on data from a national field trial of the DSM-III-R criteria Disruptive Behavior Disorders.
“B. If 18 or older, does not meet criteria for Disorder.
“Criteria for severity of Conduct Disorder:
Few if any conduct problems in excess of those required to make diagnosis, and conduct probletns cause only minor harm to others.
“Moderate: Number of conduct problems and on between ‘mild’ and ‘severe.’
“Severe: Many conduct problems in excess of those required to make diagnosis, or conduct problems cause considerable harm to others, e.g., serious physical injury to victims, extensive vandalism or theft, prolonged absence from home.”
The testimony would apparently have been to the effect that lying was one of the criteria that is looked for in making the diagnosis. It does not appear that the experts would state Malone lied to them, but rather the tendency to lie is often found in people with Malone’s disorder and is one of the things that is looked for in making the diagnosis.
The trial court held that an expert witness could not state an opinion as to the credibility or veracity of Malone. This is in keeping with our cases such as State v. Jackson, 239 Kan. 463, 721 P.2d 232 (1986), wherein we held:
“[W]e think it was error for the trial court to permit the witnesses to testify and tell the jury that in their opinions the child was telling the truth and in their opinions the defendant committed the acts of molestation with which he was charged.
“. . . Here, the witnesses attempted to serve as the child and both told the jury that in their professional opinions the child was truthful and the defendant was guilty as charged.” 239 Kan. at 470.
We believe that herein, however, the rejected testimony was not that Malone was a liar and/or was lying in his version of the events. Rather, the testimony would have been that lying is one of the diagnostic criteria used in determining whether or not Malone suffered from a conduct disorder. Obviously, the credibility to be afforded Malone’s testimony by the jury was a crucial factor in the case.
The admissibility of expert testimony lies within the sound discretion of the trial court and its determination will not be reversed absent a showing of abuse of discretion. State v. Stukey, 242 Kan. 204, Syl. ¶ 1, 747 P.2d 137 (1987).
Judicial discretion is abused when judicial action is arbitrary, fanciful, or unreasonable, which is another way of saying that discretion is abused only when no reasonable person would take the view adopted by the trial court. If reasonable persons could differ as to the propriety of the action taken by the trial court, then it cannot be said that the trial court abused its discretion. State v. Wagner, 248 Kan. 240, 242, 807 P.2d 139 (1991).
One who asserts an abuse of discretion bears the burden of showing such abuse. DeWerff v. Schartz, 12 Kan. App. 2d 553, 557, 751 P.2d 1047 (1988). See Slaymaker v. Westgate State Bank, 241 Kan. 525, 531, 739 P.2d 444 (1987); Hoover Equipment Co. v. Smith, 198 Kan. 127, 134, 422 P.2d 914 (1967); Byington v. Commr's of Saline Co., 37 Kan. 654, 657, 16 Pac. 105 (1887). Even if abuse of discretion is shown in a criminal case, the defendant has the burden of showing prejudice which requires reversal. See State v. Walker, 244 Kan. 275, 279-80, 768 P.2d 290 (1989).
The excluded evidence was to the effect that persons with Malone’s mental problem might exhibit the character trait of lying. The excluded testimony was not an opinion on whether Malone was lying at trial and does not constitute the “human lie detector” type of testimony prohibited in State v. Jackson, 239 Kan. 463. Abundant other evidence was introduced that Malone had repeatedly lied to law enforcement officers about what had occurred relative to Sauer’s death. This was evidence not that he might lie, in general, but that he in fact did lie repeatedly on matters very material to this case. Malone, in his testimony, admitted to lying repeatedly to law enforcement officers about the murder herein. Why he had lied is of considerably less importance than the fact he had lied. The aiding and abetting verdict against respondent clearly shows that Malone’s testimony was not accepted in its totality. Even if the restriction placed upon the experts’ testimony constitutes an abuse of discretion, we find no prejudice has been shown to warrant a reversal of respondent’s adjudication as a juvenile offender.
The judgment is affirmed. | [
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The opinion of the court was delivered by
McFarland, J.:
Melvin M. Sledd, Jr., appeals his jury trial conviction of involuntary manslaughter (K.S.A. 21-3404).
The underlying facts are only peripherally involved in the single issue raised on appeal. The factual summary will be limited, accordingly, to facts that relate to the issue. The victim was two- and-one-half-year-old Michael Emery, who resided in Topeka with his mother, younger brother, and the defendant, who was the mother’s boyfriend. On July 5, 1989, Medevac personnel responded to an emergency call. Michael was not breathing when Medevac arrived. He was pronounced dead shortly thereafter. The conclusion at the autopsy was that the child had been repeatedly struck in the abdominal area approximately 24 hours before his death. Numerous bruises were noticed on various parts of his body. It was the State’s theory that the child had been beaten by the defendant, said beating having resulted in the child’s death. Defendant was charged with first-degree murder but convicted of the lesser included offense of involuntary manslaughter.
The sole issue on appeal is whether the trial court violated defendant’s constitutional rights to a fair trial when it denied defendant’s challenge to the State’s removal by peremptory challenge of two black prospective jurors. The relevant jury selection facts must be set forth in some detail.
As this case was tried on the first-degree murder charge, 36 prospective jurors were qualified for cause with the State and defendant each to exercise 12 peremptory challenges. Defendant is black, as were 4 of the 36 prospective jurors. The procedure employed in exercising the challenges was for the State to write the name of its first challenge on a piece of paper and pass it to defense counsel, who wrote thereon the name of his first challenge. The paper was then passed back and forth until all challenges had been exercised. The State’s challenge number seven was to a black woman, Marcella Brown. The State’s twelfth challenge was to a black man, Gary Lassiter. Two black jurors remained on the panel at this time, although, apparently, one of those was subsequently removed through the exercise of defendant’s final peremptory challenge. Immediately after the State exercised its peremptory challenge removing Lassiter, the following occurred:
“Mr. Greeno [defense counsel]: Under the Batson decision, we have to make our record. The State has elected as strike number twelve to strike Gary Lassiter. Ah, strike number seven for the State was Marcella Brown. And I think we would have four people, four black people, from the panel that are the same race as my client. As I recall the decision under Batson—
“Mr. Greeno: As I understand it, the Court there talked about the totality of relevant facts which indicate that the State is using, you know, the race of the prospective juror as the reason for the strike.
“In this particular situation, certainly Mr. Lassiter is a black man, as is Mr. Sledd. He has exhibited that he is qualified to be a juror in this particular case and he is of good moral character, obviously that he has the intelligence necessary to ingest the facts of this particular case. He has indicated that he understands the facts, you know, as we have talked about his obligation as a juror. He has not shown any bias whatsoever. In fact, he has indicated that he could follow the instructions that the Court gave him, that he has children of his own and that he loves children. He has made a conscious effort to avoid the media. And I think he has demonstrated every ability to be a fair and impartial juror in this particular case. And under those circumstances, he hasn’t leaned any way toward the defense or to the State. And I think it’s clear in this particular situation that, you know, there is some question as to whether or not the government has exercised this challenge for the appropriate basis.
“The Court: All right.” (Emphasis supplied.)
The State then proceeded to state its reasons for the exercise of the Lassiter challenge, the thrust of which was that he was a leader in a church which approved corporal punishment. The State was concerned that Mr. Lassiter would not be a good choice for a juror in a case involving the beating of a child. Comments were then made by both counsel relative to Mr. Lassiter’s answers to questions on corporal punishment of children.
The trial court then stated:
“The Court: Thank you. The standard for this determination is set forth in Batson v. Kentucky, 476 U.S. 79, 90 L. Ed. 2d 69, 106 S. Ct. 1712, and more particularly at . . . IIIc section of the opinion.
“Just to summarize those, the Court states that the defendant is required to establish a prima facie case of purposeful discrimination in selecting the petit jury, and in determining that may rely solely on evidence concerning the prosecutor’s exercise of peremptory challenges at the defendant’s trial. To establish such a case — and I’ll just say parenthetically, I’m paraphrasing and not quoting — to establish such a case, the defendant must show that he is a member of a cognizable racial group and that the prosecutor has exercised peremptory challenges to remove from the venire members of the defendant’s race. Second, the defendant is entitled to rely on the fact, as to which there can be no dispute, that peremptory challenges constitute a jury selection practice that permits those to discriminate who are of a mind to discriminate. And, finally, defendant must show that these facts and any other relevant circumstances raise an inference that the prosecutor used that practice to exclude the veniremen from the petit jury on account of their race. This combination of factors in impaneling of the petit jury, as in the selection of the venire, raises the necessary inference of purposeful discrimination. And in deciding whether the defendant has made the requisite showing, the trial court should consider all relevant circumstances.
“The Court gives a couple of examples. One example is a pattern of strikes against black jurors included in the particular venire might give rise to an inference of discrimination. Similarly, the prosecutor’s questions and statements during voir dire examination and in exercising his challenges may support or refute an inference of discriminatory purpose. The Court points out that these examples are merely illustrative, and that the Court goes on to say that the trial court’s experience in supervising voir dire will be able to decide if the circumstances concerning the prosecutor’s use of peremptory challenges creates a prima facie case of discrimination against black jurors.
“Now, once the defendant makes a prima facie showing, the burden shifts to the State to come forward with a neutral explanation for challenging black jurors. And the ultimate requirement is that the prosecutor must articulate a neutral explanation related to the particular case to be tried. And the trial court will then have the duty to determine if the defendant has established purposeful discrimination.
“So with these rules in mind, the Court will proceed with its decision.
“In the case at bar, we have the State having exercised all of the peremptory challenges, the defendant has one peremptory challenge left. Out of thirty-six potential or prospective jurors passed for cause, the State has exercised peremptory challenges towards two black potential or prospective jurors. There are two remaining on the jury unless one of those two would be removed by the twelfth and final strike of the defendant.
“In reviewing the pattern of strikes against black jurors, the Court does not find or is not persuaded that they give rise to the inference of discrimination. The State had twelve peremptory challenges, and it’s true that they have used two of the twelve in regard to two out of four black jurors. The other black juror is not in contention here. Her husband works for the Kansas Highway Patrol. She was removed by State challenge: But certainly if there had been an inclination, the State in the first instance could have exercised challenges to all four black prospective jurors.
“In reviewing the prosecutor’s questions and statements during voir dire examination and in exercising the prosecutor’s challenges, the Court sees nothing that would support an inference of discriminatory purpose. Those questions and statements were neutral in the Court’s view. ■ ■
“In considering other circumstances and all relevant circumstances and the totality of the circumstances, I’m not persuaded at this point the defendant has established or made a prima facie showing that there has been a discriminatory purpose on the part of the prosecutor in the case at bar.”
The trial court then proceeded to hold that even if a prima facie showing had been made, then the State had shown adequate racially neutral reasons for its actions. In an unpublished decision filed June 7, 1991, the Court of Appeals held this determination was reversible error. The matter is before us on petition for review.
In Batson v. Kentucky, 476 U.S. 79, 90 L. Ed. 2d 69, 106 S. Ct. 1712 (1986), the United States Supreme Court held that the striking of black venire members based on racial grounds or the belief that black jurors will be sympathetic to a defendant of their own race violates the Equal Protection Clause of the United States Constitution. 476 U.S. at 89. In its ruling, the Court stated that for a defendant to prove discrimination on the part of the prosecution:
“[T]he defendant first must show that he is a member of a cognizable racial group [citation omitted], and that the prosecutor has exercised peremptory challenges to remove from the venire members of the defendant’s race. Second, the defendant is entitled to rely on the fact, as to which there can be no dispute, that peremptory challenges constitute a jury selection practice that permits ‘those to discriminate who are of a mind to discriminate.’ [Citation omitted.] Finally, the defendant must show that these facts and any other relevant circumstances raise an inference that the prosecutor used that practice to exclude the veniremen from the petit jury on account of their race . . . .”
“Once the defendant makes a prima facie showing, the burden shifts to the State to come forward with a neutral explanation for challenging black jurors. Though this requirement imposes a limitation in some cases on the full peremptory character of the historic challenge, we emphasize that the prosecutor’s explanation need not rise to the level justifying exercise of a challenge for cause. [Citations omitted.] But the prosecutor may not rebut the defendant’s prima facie case of discrimination by stating merely that he challenged jurors of the defendant’s race on- the assumption — or his intuitive judgment — that they would be partial to the defendant because of their shared race. [Citations omitted.] . . . Nor may the prosecutor rebut the defendant’s case merely by denying that he had a discriminatory motive or ‘affirming],-[his] good faith in making individual selections.’ [Citation omitted.] . . ...The prosecutor therefore must articulate a neutral explanation related to the particular case; to be tried.” 476 U.S. at 96-98.
The Batson court gave an example of how a prima facie case might be established: “In deciding whether the defendant has made the requisite showing, the trial court should consider all relevant circumstances. For example, a pattern’ of strikes against black jurors included in the particular venire might give rise to an inference of discrimination.” 476 U.S. at 96-97. Justice White addressed the establishment of a prima facie case in his concurrence: “The Court emphasizes that using peremptory challenges to strike blacks does not end the inquiry; it is not unconstitutional, without more, to strike one or more blacks from the jury. The judge may not require the prosecutor to respond at all.” 476 U.S. at 101.
The United States Supreme Court has subsequently reaffirmed and extended Batson. In Powers v. Ohio, 499 U.S. _, 113 L. Ed. 2d 411, 111 S. Ct. 1364 (1991), the court held that a white defendant may challenge the State’s peremptory strikes on racial grounds, and in Edmonson v. Leesville Concrete Co., 500 U.S. _, 114 L. Ed. 2d 660, 111 S. Ct. 2077 (1991), the Court extended Batson to include civil suits. However, these extensions do not affect the case before us, so we will confine our discussion to Batson.
The ruling in Batson was adopted by the Kansas Supreme Court in State v. Hood, 242 Kan. 115, 744 P.2d 816 (1987) (Hood I), and since that time we have applied the ruling in the cases of Smith v. Deppish, 248 Kan. 217, 807 P.2d 144 (1991); State v. Belnavis, 246 Kan. 309, 787 P.2d 1172 (1990); and State v. Hood, 245 Kan. 367, 780 P.2d 160 (1989) (Hood II).
Before proceeding further, some discussion of our holding in State v. Belnavis, 246 Kan. 309, is necessary. In Belnavis, we quoted from Batson the three aspects of what must be shown by a defendant in order to make the requisite prima facie case that the prosecution has excluded a juror or jurors based upon race. We go on, however, to state:
“Belnavis has shown that he is a member' of a cognizable racial group and that the State used its peremptory challenges to strike black persons from the jury panel. Furthermore, Belnavis is entitled to rely, on the fact that peremptory challenges allow those who are of a mind to . discriminate to do so. Thus, under the rule set forth in Batson and adopted by this court in Hood, Belnavis made a prima facie showing of purposeful discrim ination by the State. It then became the State’s burden to come forward with a racially neutral explanation for challenging the black persons.” 246 Kan. at 312.
This language, and its corresponding syllabus (Syl. ¶ 1), omits the third portion of the Batson requirements for making a prima facie showing. We hereby disapprove said omission in Belnavis.
The trial court here held that the defendant had failed to make the requisite prima facie showing that the State had excluded black prospective jurors on account of their race.
Whereas the scope of review on a trial court’s finding that the State has expressed racially neutral reasons is that of abuse of discretion (Smith v. Deppish, 248 Kan. 217), appellate review of a trial court’s determination whether or not a prima facie showing has been made is plenary as it involves a question of legal sufficiency. As reasoned in State v. Butler, 795 S.W.2d 680, 687 (Tenn. Crim. App. 1990):
“Batson was based on Title VII .... The Court suggested that those cases ‘have explained the operation of prima facie burden of proof rules.’ 476 U.S. at 94 n. 18, 106 S. Ct. at 1721-22 n. 18. The federal courts treat the prima facie determination as a question of law rather than one of fact; ‘the question is one of legal sufficiency, and an appellate court’s review is plenary. [Citation omitted.]”
The format employed in the hearing on the objection creates some problems in the analysis of the issue. The appropriate procedure would have been for the defense to proceed to state whatever it has in support of the requisite prima facie showing, and for the court, at that point, to determine whether or not the defense has made the prima facie showing. If the trial court finds the showing has not been made, then that is technically the end of the matter. Under Batson, the State is asked to respond only if the trial court has found that the prima facie showing has been made. As a practical matter, it is the better practice to have the State respond, and then for the court to make a determination on whether the reasons are racially neutral. This procedure would eliminate remands for such a determination if the trial court is held to have erred in holding the defendant had failed to make the prima facie showing.
Here the defendant offered only the facts that he was black and that the State used 2 of its 12 peremptory challenges to exclude 2 of 4 black prospective jurors. The balance of defense counsel’s argument consisted of expressions of his opinion that Lassiter would be a suitable juror. These comments were in anticipation of the reasons the State would offer relative to Lassiter’s exclusion and are really irrelevant to the prima facie showing aspect of the matter. There was no claim that the State had any pattern to exclude blacks.
We conclude that the trial court correctly held that the defendant had failed to make the prima facie case required by Batson. Having so concluded, we do not reach the issue of whether the trial court’s acceptance of the State’s proffered reasons for exclusion constituted a breach of trial court discretion.
The judgment of the Court of Appeals is reversed. The judgment of the district court is affirmed. | [
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Per Curiam:
This is an original proceeding in discipline filed by the disciplinary administrator against Malcolm L. Copeland of Topeka, an attorney admitted to the practice of law in Kansas. The facts, as determined by the hearing panel of the Kansas Board for the Discipline of Attorneys (the panel), are not disputed.
The complaints against Copeland are set out herein.
Catherine L. Ferguson died testate on November 21, 1988. Her will left all of her property, both real and personal, to her sister-in-law Hazel C. Ferguson, and named Doral H. Hawks as executor.
Hazel C. Ferguson met with Copeland on January 17, 1989, and retained him to probate the will. At this meeting, Ferguson gave the will to Copeland. Kansas law requires that a petition for probate be filed within six months of the date of death. K.S.A. 1990 Supp. 59-617.
Copeland did not file the petition for probate of will and issuance of letters testamentary until August 27, 1990, 21 months after Catherine L. Ferguson’s death. In the petition, Copeland falsely stated that the will had been lost and only discovered recently.
The notice of hearing and notice to creditors that was caused to be published by Copeland inaccurately identified Hazel C. Ferguson as an heir and executrix.
Mertle Marie Miller, a cousin and heir of the decedent, filed an answer and written defenses to the petition. Miller also filed a petition for determination of descent, stating that she and Margarete Bensen, another cousin, were the only heirs of Catherine L. Ferguson. A decree of descent was entered by the Shawnee County District Court, assigning all property owned by Catherine L. Ferguson to Miller and Bensen, in equal shares, as the sole heirs at law.
The actions of respondent deprived Hazel C. Ferguson of the property under the will.
The panel concluded by clear and convincing evidence that Copeland violated the following:
“Findings .of Fact
“2. The Panel finds that Respondent violated MRPC 1.1 [1991 Kan. Ct. R. Annot. 228] and MRPC 1.3 [1991 Kan. Ct. R. Annot. 232] by failing to file in a timely fashion the Petition for Probate of the estate of [Catherine] L. Ferguson, Deceased.
“3. The panel finds that Respondent violated MRPC 3.1 [1991 Kan. Ct. R. Annot. 273] and 3.3 [1991 Kan. Ct. R. Annot. 275] by stating in the Probate Petition there was a lost will, when in fact, it was not lost.”
The panel stated:
“Respondent cooperated with the Disciplinary Administrator’s Office and produced evidence in support of mitigation of discipline in this matter which included:
“1. Evidence that he was under the care and treatment of Gail Gunter Smith, a licensed specialist clinical social worker, [for alcohol-related problems];
“2. Evidence that he has participated actively in therapy for this condition, continues to participate and comply with the therapist, and has a good prognosis for change in his behavior patterns;
“3. Evidence that he made complete restitution to his former client, Hazel C. Ferguson;
“4. Evidence that he has instituted a tickler system in his office to assure that deadlines are met in his practice; and
“5. Evidence that restitution to Ms. Ferguson in the amount of $12,000 was paid by Mr. Copeland from monies borrowed against his life insurance policy.
“Based on the undisputed mitigating factors presented by the Respondent including a letter from Judge [E.] Newton Vickers and a letter approved by Hazel Ferguson, and the fact that as a result of the restitution there does not appear to have been any harm to a client, it is the unanimous recommendation of the panel that the Respondent be publicly censured by the Supreme Court for each violation.”
We adopt the panel’s recommendation.
We order that Malcolm L. Copeland be, and he is hereby, disciplined by public censure in accordance with Supreme Court Rule 203(a)(3) (1991 Kan. Ct. R. Annot. 143) for his violations herein.
It Is Further Ordered that , this order be published in the official Kansas Reports and that the costs of the proceeding be assessed to the respondent.
Dated this 17th day of January, 1992. | [
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The opinion of the court was delivered by
Allegrucci, J.:
Laurence M. Jarvis, an attorney, filed this action against the defendant, Terry W. Drake, to recover for malicious prosecution, libel, and tortious interference with contract. The district court concluded that Drake was immune from suit and entered summary judgment in his favor. Jarvis appeals from the district court’s entry of summary judgment. Drake cross-appeals from the district court’s denial of his request for attorney fees. The appeal was transferred from the Court of Appeals to this court by order of the court on January 7, 1992.
Recause it is the district court’s entry of summary judgment in favor of Drake which is challenged on appeal, this court must read the record in the light most favorable to Jarvis. McAlister v. Atlantic Richfield Co., 233 Kan. 252, Syl. ¶ 4, 662 P.2d 1203 (1983). The facts, therefore, are related in that light.
Jarvis is an attorney who practices in Wyandotte County, Kansas. Among his clients is Judith Drake, the former wife of defendant Terry Drake. On behalf of Judith Drake, Jarvis sought to recover from Terry Drake unpaid child support and insurance reimbursement payments and to obtain an increase in child support payments.
In May 1989 Terry Drake wrote a letter to the office of the disciplinary administrator, alleging the following against Jarvis: (1) twice meeting in secret with the administrative hearing officer who handled the Drake divorce; (2) requesting the Internal Revenue Service to investigate Terry Drkke; and (3) wrongfully filing a garnishment on Terry Drake’s wages and doing so without authority from Judith Drake. Jarvis alleges that Drake knew these allegations were false when he made them.
After an investigation of Drake’s allegations, his complaint was dismissed by the disciplinary administrator for lack of probable cause.
Jarvis filed a petition against Drake in the District Court of Wyandotte County, seeking to recover for malicious prosecution and libel. He later was allowed to amend his petition to add a charge of tortious interference with contract. Jarvis alleged that Drake “maliciously, wrongfully, intentionally, and without probable cause file[d] false, serious, and groundless charges against [him].”
Drake filed a motion for summary judgment on the ground that at all times pertinent to the allegations he was cloaked with immunity. The district court granted Drake’s motion for summary judgment and affirmed its own ruling upon consideration of Jarvis’ motion for rehearing.
Drake requested that the district court award to him the amount of the attorney fees expended in defense of Jarvis’ allegations. The district court declined to award attorney fees.
We first consider if the district court erred in granting summary judgment in favor of defendant on the ground that he is immune from suit under Supreme Court Rule 223 (1991 Kan. Ct. R. Annot. 172). Supreme Court Rule 223, entitled “Immunity,” states as follows:
“Complaints, reports, or testimony in the course of disciplinary proceedings under these Rules shall be deemed to be made in the course of judicial proceedings. All participants shall be entitled to judicial immunity and all rights, privileges and immunities afforded public officials and other participants in actions filed in the courts of this state.”
The only case which interprets this rule involves a different issue — self-incrimination. State v. Savaiano, 234 Kan. 268, 271-74, 670 P.2d 1359 (1983).
In 1988, Rule 223 was amended to add the words, “judicial immunity and,” in the second sentence. Thus, before the amendment, all participants in disciplinary proceedings were entitled to “immunities afforded public officials and other participants in actions filed in the courts of this state.” 1987 Kan. Ct. R. Annot. 121. After the amendment, all participants in disciplinary proceedings are entitled to “judicial immunity” as well as “immunities afforded public officials and other participants in actions filed in the courts of this state.” 1991 Kan. Ct. R. Annot. 172.
When called as a witness at the hearing on Drake’s motion for summary judgment, Bruce Miller, Disciplinary Administrator for the State of Kansas, testified that the addition of “judicial immunity” to Rule 223 was intended to increase or strengthen the protection afforded participants in disciplinary proceedings. He testified that:
“The closest thing to absolute immunity to exist is judicial immunity.
“In discussing this rule with the Court, one of the things that we wanted to do was to re-enforce the rights of a person, of a citizen, of the state, to make complaints against attorneys to be handled by an agency of the supreme court.
“And the court agreed — this was, in fact, my suggestion to the court, and the court did agree with that suggestion and did adopt it and put it into the rule.
“And this is the kind of immunity that I believe the court was attempting to bestow upon all personnel connected with the disciplinary — all people connected with the disciplinary process, be the[y] complainants, be the[y] respondent, attorneys, be they — any of the investigators, of the — or the Kansas Board [for] Discipline that [make] the decision in regards to these complaints as they go through the system.”
According to Miller, the reason he suggested strengthening the grant of immunity was that he and his staff
“just find it to be of extreme importance [to] the entire ethics system of this state that any person that has a complaint against an attorney be allowed to express that complaint. It’s the purpose of this system to find out whether it has merit or [does] not [have] merit.”
Judicial immunity is a long- and firmly established common-law rule. It was described by the United States Supreme Court in the following words:
“Few doctrines were more solidly established at common law than the immunity of judges from liability for damages for acts committed within their judicial jurisdiction, as this Court recognized when it adopted the doctrine, in Bradley v. Fisher, 13 Wall. 335 [, 20 L. Ed. 646] (1872). This immunity applies even when the judge is accused of acting maliciously and corruptly, and it ‘is not for the protection or benefit of a malicious or corrupt judge, but for the benefit of the public, whose interest it is that the judges should be at liberty to exercise their functions with independence and without fear of consequences.’ (Scott v. Stansfield, L.R. 3 Ex. 220, 223 [1868], quoted in Bradley v. Fisher, supra, 349; note, at 350.) It is a judge’s duty to decide all cases within his jurisdiction that are brought before him, including controversial cases that arouse the most intense feelings in the litigants. His errors may be corrected on appeal, but he should not have to fear that unsatisfied litigants may hound him with litigation charging malice or corruption. Imposing such a burden on judges would contribute not to principled and fearless decision-making but to intimidation.” Pierson v. Ray, 386 U.S. 547, 553-54, 18 L. Ed. 2d 288, 87 S. Ct. 1213 (1967).
The principle of judicial immunity has remained viable in the face of challenges in some very emotionally and politically charged cases. Pierson v. Ray, for example, arose out of the arrests of black and white clergymen for their use of segregated facilities at an interstate bus terminal in Mississippi in 1961. Stump v. Sparkman, 435 U.S. 349, 55 L. Ed. 2d 331, 98 S. Ct. 1099, reh. denied 436 U.S. 951 (1978), involved judicial approval of a mother’s petition to have her minor daughter sterilized on the ground that the daughter was “somewhat retarded.” The daughter, who attended public school and had been promoted each year, was told at the time that she was to have her appendix removed. When the daughter later married and wished to conceive, she learned the true nature of the surgery she had undergone. The Supreme Court held that the judge who had approved the petition for sterilization was not subject to civil liability because he was absolutely immune.
Since Stump v. Sparkman was decided in 1978, the Supreme Court has considered several cases in which a determination was made that the doctrine of judicial immunity did not apply where a judge was acting in an administrative rather than judicial capacity, but there have been no decisions which diminished the protection afforded by the common-law rule. See Forrester v. White, 484 U.S. 219, 98 L. Ed. 2d 555, 108 S. Ct. 538 (1988); Supreme Court of Va. v. Consumers Union, 446 U.S. 719, 64 L. Ed. 2d 641, 100 S. Ct. 1967 (1980). There is no question that judicial immunity is applicable in the present case, since Rule 223 specifies that complaints in disciplinary proceedings “shall be deemed to be made in the course of judicial proceedings.” (Emphasis added.)
The rationale for judicial immunity is to free judges to make controversial decisions without the intimidation of exposure to personal liability. The Supreme Court pointed out in Bradley v. Fisher, 80 U.S. (13 Wall.) 335, 20 L. Ed. 646 (1872), that permitting dissatisfied litigants to make the decisions of judges the basis of personal consequences for them would tend to subvert justice.
The disciplinary administrator testified that the same rationale underlies the Rule 223 grant of judicial immunity to all participants in disciplinary proceedings. For complainants, apprehension of personal liability for presenting a question of professional responsibility to the disciplinary administrator might tend to subvert the system established for ensuring that persons holding licenses to practice law are “fit to be entrusted with professional and judicial matters.” Supreme Court Rule 202 (1991 Kan. Ct. R. Annot. 142). The complainants’ freedom from apprehension should tend to promote the disciplinary administrator’s investigation of “all matters involving possible misconduct,” as required by Supreme Court Rule 205(c)(2) (1991 Kan. Ct. R. Annot. 147).
Jarvis contends that Rule 223 was not intended to abolish the common-law cause of action for malicious prosecution, but that is the effect of the district court’s ruling. He argues that, even if Rule 223 grants absolute immunity in defamation cases, it does not bar a cause of action for malicious prosecution. The distinction he draws is between privileged communications and the act of instituting a proceeding.
Jarvis’ argument seems to be that statements made by Drake in his complaint are protected under the rule, but that the conduct of Drake in filing the complaint with the disciplinary administrator is not protected. We find no such distinction in Rule 223. It provides protection for persons. There is nothing in the text of the rule which would indicate that the protective cloak may or may not be donned depending on whether it is needed on account of statements or conduct.
The language in earlier Kansas cases involving various aspects of immunity tends to confirm that no distinction need be drawn between acts and statements. Sampson v. Rumsey, 1 Kan. App. 2d 191, 563 P.2d 506 (1977), involved the question whether a prosecutor was immune from suit by a witness for slander, conspiracy to slander, abuse of process, invasion of privacy, and intrusion on seclusion. The standards applied by the Court of Appeals in determining that the prosecutor was absolutely immune were set out as follows:
“In Clear Water Truck Co., Inc. v. M. Bruenger & Co., Inc., 214 Kan. 139, 142-143, 519 P.2d 682, the court cited with approval the following rule of absolute privilege in judicial proceedings referred to in Froelich v. Adair, 213 Kan. 357, 516 P.2d 993:
‘. . . Judicial proceedings are absolutely privileged communications, and statements in the course of litigation otherwise constituting an action for slander, libel, or one of the invasion of privacy torts involving publication, are immune from such actions. They are privileged communications because of the overriding public interest in a free and independent court system. This absolute privilege extends immunity to parties to private litigation and to anything published in relation to a matter at issue in court, whether said in pleadings, affidavits, depositions or open court. (Weil v. Lynds, 105 Kan. 440, 185 Pac. 51.)’ ” (Emphasis added.) 1 Kan. App. 2d at 194.
In this regard, the court also said: “The same policy considerations requiring absolute immunity for communications made during the course of a prosecution require immunity for conduct in investigations which may lead to a prosecution.” 1 Kan. App. 2d at 197.
Jarvis argues that the scope of judicial immunity is not absolute. The language from Froelich v. Adair, 213 Kan. 357, 516 P.2d 993 (1973), which is quoted in Sampson, and the decision in Sampson show that this argument has no merit. The protection afforded the prosecuting attorneys in Sampson was said to be absolute.
At the time Sampson was decided, the text of what is now Rule 223 did not contain the phrase “judicial immunity.” It entitled participants in disciplinary proceedings to the “immunities afforded public officials.” The immunity afforded the public prosecutors in Sampson was absolute. When absolute immunity has been enhanced by the addition of judicial immunity, there is little question that the resulting immunity is absolute.
We find ourselves in the unique role of interpreting our own rule. If Rule 223 were ambiguous, then our intent in adopting the rule and amendment would be controlling. We do not find the rule to be ambiguous. The grant of immunity afforded by Rule 223 is absolute and precludes the plaintiff from filing a malicious prosecution action against Drake. It should be noted that the proceedings in a disciplinary matter are confidential under Supreme Court Rule 222 (1991 Kan. Ct. R. Annot. 171) up to the determination of probable cause. Because no finding of probable cause was made as to Drake’s complaint against the plaintiff, the proceedings were confidential and not a matter of public record.
We next consider if Rule 223 is unconstitutional. Jarvis’ statement of this issue specifies denial of equal protection as the constitutional infirmity in Rule 223. He cites United States Supreme Court cases involving antimiscegenation statutes and a state requirement that an indigent defendant pay an appellate filing fee. He also cites § 18 (but not § 1, the equal protection clause) of the Bill of Rights of the Kansas Constitution. His reliance on these authorities seems to be for the proposition that his right to sue Drake is a fundamental right which cannot be curtailed by the state unless the abridgment is necessary to a compelling state interest. We do not agree.
In Edelstein v. Wilentz, 812 F.2d 128 (3d Cir. 1987), a New Jersey attorney challenged the constitutionality of a New Jersey Supreme Court rule similar to our Rule 223. The New Jersey rule created absolute immunity to grievants and witnesses in ethics cases. The New Jersey Supreme Court in 1955 held that the filing of a complaint against an attorney with the county ethics and grievance committee was privileged so as to preclude an action for malicious prosecution. Toft v. Ketchum, 18 N.J. 280, 113 A.2d 671, cert. denied 350 U.S. 887 (1955). The state legislature immediately responded by enacting a statute which expressly allowed a “malicious prosecution action to be brought against the complainant by an attorney who is the subject of an ethics complaint.” Matter of Hearing on Immunity for Ethics Complainants, 96 N.J. 669, 672, 477 A.2d 339 (1984). See N.J. Stat. Ann. 2A:47A-1 (West 1987). The New Jersey Supreme Court expressed concern that the statute may have been “deterring non-malicious potential complainants” and added that the “potential for intimidation is obvious.” 96 N.J. at 675. Therefore, the New Jersey court adopted a new rule which provided absolute immunity for grievants, “despite its clear conflict with existing legislation.” 96 N.J. at 678. It is that rule which was challenged in Edelstein v. Wilentz.
In Edelstein, the court discussed fundamental rights for the purpose of determining which level of scrutiny was appropriate for the New Jersey rule which provided immunity for grievants. The court determined that there was no fundamental right involved and analyzed the classification under a rational relationship standard. 812 F.2d at 132. Nonetheless, the court upheld the constitutionality of the rule, stating:
“In short, the New Jersey Supreme Court made a policy judgment that the imposition of the absolute immunity rule for ethics complainants was justified by the need to maintain and increase public confidence in the bench and the bar.
“We cannot say that the position taken by the New Jersey Supreme Court is irrational. The choice of the absolute immunity rule represents a reasoned policy choice directed to the legitimate state goal of effective regulation of attorney conduct. This is sufficient to uphold the Rule against Edelstein’s equal protection challenge.” 812 F.2d at 133.
The same basic policy decision was made by this court in amending Supreme Court Rule 223, and the same analysis and reasoning applied in Edelstein apply in the present case..
Our judicial system cannot survive without the public’s trust in the system and the belief that justice will prevail. The public is asked to place its trust in a system dominated by attorneys. To a great extent, that trust is measured by how we, the bench and bar, implement and enforce the disciplinary rules. The purpose of Supreme Court Rule 223 is to encourage the members of the public to file complaints against attorneys who have violated the rules of ethics. It is rationally related to the objective of effectively regulating the conduct of the bar, which in turn protects the public’s interest. Thus, Supreme Court Rule 223 is not unconstitutional as a violation of the equal protection guarantee of the United States Constitution.
We next consider Drake’s cross-appeal. After the district court granted Drake’s motion for summary judgment, Jarvis filed a motion for rehearing. Drake responded with a request for attorney fees. Drake asserted that the suit’s lack of merit should have been apparent to Jarvis from the plain language of Rule 223 and that Jarvis’ motion for rehearing following summary judgment raised no new issues.
The district court denied the request for attorney fees. Drake filed a cross-appeal from the denial of attorney fees.
Drake concedes that the awarding of attorney fees is left to the sound discretion of the district court. In Cornett v. Roth, 233 Kan. 936, 945, 666 P.2d 1182 (1983), this court stated: “The assessment of attorney fees under K.S.A. 1982 Supp. 60-211 and K.S.A. 1982 Supp. 60-2007(h) lies within the sound discretion of the trial court and will not be disturbed on appeal absent an abuse of that discretion.”
K.S.A. 1991 Supp. 60-211 provides in pertinent part that an attorney’s signature on a pleading constitutes a certificate that it “is warranted by existing law or a good faith argument for the extension, modification or reversal of existing law.” K.S.A. 60-2007(b) provides in pertinent part that reasonable attorney fees incurred as a result of defending against the assertion of a claim “without a reasonable basis in fact and not in good faith” should be allowed. Subsection (d) adds that “[t]he purpose of this section is not to prevent a party from litigating bona fide claims or defenses, but to protect litigants from harassment and expense in clear cases of abuse.”
Drake contends that this is a case of abuse because Jarvis initiated the suit despite the plain language of the rule and despite being advised by the disciplinary administrator that Rule 223 afforded absolute immunity. Bruce Miller testified that after the grievance was dismissed, Jams wrote to him stating his intention to sue Drake. Miller further testified that he telephoned Jarvis and confirmed the telephone conversation with a letter. He stated to Jarvis: “While there is no applicable case law under this rule, I would believe that it is intended to give every person connected with the court’s disciplinary system complete immunity from suit. . . . There may or may not be an exception to this immunity for acts of malicious or intentional defamation.”
In light of Miller’s testimony as to his advice to Jarvis and the fact that this is the first time this court has considered the scope and applicability of the immunity granted by Rule 223, we cannot say that Jarvis’ petition was without reasonable basis in fact and was not in good faith. We therefore find that the district court did not abuse its discretion in denying an award of attorney fees.
The judgment of the district court is affirmed. | [
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The opinion of the court was delivered by
McFarland, J.:
This appeal arises out of the settlement of a medical malpractice action. Defendant Stephan J. Bazzano is an osteopathic physician practicing in Galena. He is a Missouri resident but a licensed Kansas health care provider.
On March 28, 1986, Bazzano allegedly misdiagnosed the cause of the illness of plaintiff Jessica M. Simon, age three months, who was permanently damaged by her failure to receive proper treatment. A medical malpractice action was filed in July 1987. On March 18, 1991, with the approval of the district court, the case was settled for $900,000. The Kansas Health Care Stabilization Fund appeared at and participated in the settlement proceedings. It is apparently undisputed that the Fund is responsible for payment of $700,000 of the judgment.
This appeal concerns liability for payment of the first $200,000 of the judgment. The district court’s journal entry provides:
“The Court further finds that based upon representations made by counsel, that the Kansas Insurance Guaranty Fund and the Missouri Insurance Guaranty Association have joint and several liability for the Two Hundred Thousand Dollar ($200,000.00) primary coverage for the defendant. The Court further finds that the Kansas Insurance Guaranty Fund and the Missouri Insurance Guaranty Association have a dispute concerning the proportionate, share each is to pay.”
The Kansas Insurance Guaranty Association (KIGA) is the appellant herein. KIGA contends: (1) Under K.S.A. 40-2910(b) the Missouri Insurance Guaranty Association (MIGA) is primarily liable for the $200,000 coverage and that, accordingly, it was error for the district court to hold KIGA and MIGA jointly and severally liable therefor; and (2) K.S.A. 40-2915 precludes any entry of judgment against KIGA.
We do not reach the merits of the appeal herein as there is a jurisdictional mountain that KIGA has failed to ascend. KIGA is not now, nor has it ever been, a party to this action. The record in this case is confined to the malpractice action between the patient and health care provider, with the Health Care Stabilization Fund participating in the settlement. A number of extrajudicial documents and allegations are present in the briefs, indicating that Razzano’s professional insurance carrier, Professional Mutual Insurance Company, became insolvent after the filing of the action herein, which resulted in KIGA becoming actively involved in the defense of the action. However, KIGA never intervened in the action and, either through plan or inadvertence, left no tracks in the record of its involvement other than a nonparticipating presence at the settlement hearing.
KIGA asserts that K.S.A. 60-264 affords it the right to appeal herein. The statute provides:
“When an order is made in favor of a person who is not a party to the action, he or she may enforce obedience to the order by the same process as if he or she were a party; and, when obedience to an order may be lawfully enforced against a person who is not a party, he or she is liable to the same process for enforcing obedience to the order as if he or she were a party.”
The Advisory Committee Notes on the statute state:
“This section follows Federal Rule 71. It will avoid considerable complicated procedure when applicable.
“The section does not designate in what instances court process is to be used for or against nonparties. Examples of the use of process for nonparties would be, enforcement of restraining orders and injunctions against non-parties in privity with parties; writs of assistance for the purchaser at a foreclosure to get possession of the property, or the charging of costs against witnesses who obstruct discovery process. Another example is found in Woods v O’Brien, 78 F Supp 221, where a tenant, who was adversely affected by his landlord’s violation of an injunction, was permitted to institute contempt procedure.
“Variations from Federal Rule. — This section is the same as Rule 71 of the Federal Rules of Civil Procedure.” Gard’s Kansas C. Civ. Proc. Annot. § 60-264 (1963).
To the same effect, see the author’s commentary in 1 Gard’s Kansas C. Civ. Proc. 2d Annot. § 60-264 (1979).
Boyce v. Knudson, 219 Kan. 357, 548 P.2d 712 (1976), is the only Kansas appellate decision involving K.S.A. 60-264. Boyce originated as a mechanic’s lien foreclosure action. After judgment, certain nonparty lienholders sought implementation of the judgment under K.S.A. 60-264. The district court denied implementation and the nonparty lienholders appealed therefrom. These lienholders were not appealing from the underlying judgment, only from the denial of their post-judgment motion under K.S.A. 60-264 for implementation of the judgment.
K.S.A. 60-264 clearly is of limited application and relates to the process involved in enforcement of a judgment in favor of or against nonparties and does not vest any nonparties with standing to appeal from the underlying judgment.
KIGA was never a party to the action herein and never requested to be made a party. In the absence of express statutory authorization, those who are not parties to an action have no standing to appeal. See Frey, Inc. v. City of Wichita, 11 Kan. App. 2d 116, 715 P.2d 417 (1986). We find no legal basis upon which to support a finding that KIGA has standing to bring the appeal herein. Accordingly, the appeal must be dismissed. KIGA is not left without a forum, however. A garnishment proceeding has been filed against KIGA, which proceeding is being held in abeyance pending the outcome of this appeal.
The appeal is dismissed. | [
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The opinion of the court was delivered by
Six, J.:
This original action in mandamus is a statutory interpretation case. We are presented with a first impression issue arising from the qualifications imposed by the legislature on candidates for the office of sheriff. Our resolution of the relationship of three statutes, K.S.A. 19-801b(a) (qualifications for the office of sheriff), K.S.A. 19-826 (mandatory fingerprinting requirement for candidates for sheriff), and K.S.A. 1990 Supp. 12-4516 (ex-pungement of convictions), will control the disposition of this issue.
William H. Chamberlain, who wishes to be a sheriff, filed an original action in mandamus. Jarkice Buhrman, Miami County Clerk/Election Officer, is the respondent. Buhrman terminated Chamberlain’s candidacy for the office of sheriff because he had been convicted of driving while under the influence of alcohol or drugs and an open container of liquor offense and was disqualified to he elected sheriff under K.S.A. 19-801b(a)(3). Chamberlain’s convictions had been expunged. Chamberlain seeks an order in mandamus directing Buhrman to place his name on the ballot.
The question is whether expungement of the liquor-related offenses clears the K.S.A. 19-801b(a)(3) conviction prohibition, thus permitting Chamberlain’s name to appear on the ballot.
The answer is no. We deny the writ of mandamus. Chamberlain is statutorily prohibited from filing for the office of sheriff.
Facts
Chamberlain submitted his name to Buhrman to be placed on the ballot for the elected office of Sheriff of Miami County, Kansas. Buhrman forwarded Chamberlain’s fingerprints to the Kansas Bureau of Investigation (KBI) as required by K.S.A. 19-826. The KBI issued a certification of fingerprint search, notifying Buhrman that Chamberlain had been convicted of liquor-related violations (driving while under the influence and operating a motor vehicle with an open container) which under K.S.A. 19-801b would preclude him from serving as sheriff.
Before submitting his name to Buhrman, Chamberlain had obtained an order expunging the two liquor-related convictions under K.S.A. 1990 Supp. 12-4516.
Buhrman informed Chamberlain of the KBI search result and that he had five days, under K.S.A. 19-826(c), to correct any error. Chamberlain did not respond. Buhrman informed Chamberlain by letter that his candidacy for sheriff had been terminated.
Qualifications for the Office of Sheriff
Chamberlain contends that K.S.A. 1990 Supp. 12-4516(e) contains limited instances when information concerning an expungement conviction may be released after an order of expungement has been entered. He argues that K.S.A. 1990 Supp. 12-4516(e) does not provide for release of information concerning an expunged conviction when a name is submitted for the elected office of sheriff. Therefore, Chamberlain reasons the KBI improperly reported his convictions to Buhrman.
Buhrman counters that K.S.A. 19-801b(a) unambiguously states that a person is not eligible to run for sheriff unless such person “has never been convicted’ of a liquor-related offense. Buhrman asserts that expungement of a conviction of a liquor-related offense neither alters the fact of thé conviction nor removes the disqualification for holding the office of sheriff. We agree. We also agree with Buhrman’s argüinent that K.S.A. 1990 Supp. 12-4516(e)(2) demonstrates legislative intent that persons attempting to hold the office of sheriff disclose expunged liquor-related convictions. K.S.A. 1990 Supp. 12-4516(e)(2) requires persons applying for employment with a criminal justice agency to disclose expunged convictions, if asked in an application for employment.
K.S.A. 19-801b(a)(3) states:
“No person shall be eligible for nomination, election or appointment to the office of sheriff unless such person:
“(3) has never been convicted of or pleaded guilty or entered a plea of nolo contendere to any felony charge or to any violation of any federal or state laws or city ordinances relating to gambling, liquor or narcotics.”
K.S.A. 19-826(b) requires candidates for the office of sheriff to be fingerprinted. K.S.A. 19-826(c) also requires the county election officer to send the candidate’s fingerprints to the KBI for a search of state and national fingerprint files to determine if the candidate qualifies for the office of sheriff under K.S.A. 19-801b. K.S.A. 19-801b(a)(3) and K.S.A. 19-826(c) are specific statutes dealing with qualifications for election to the office of sheriff.
K.S.A. 1990 Supp. 12-4516(e) indicates the legislature intends persons applying for law enforcement positions to disclose expunged convictions, if asked. The fingerprint search mandated by K.S.A. 19-826 is an inquiry into a sheriff candidate’s criminal record.
K.S.A. 1990 Supp. 12-4516(e) provides, in part:
“When the court has ordered a conviction expunged, the order of expungement shall state the information required to be contained in the petition. The clerk of the court shall send a certified copy of the order of expungement to the federal bureau of investigation, the Kansas bureau of investigation, the secretary of corrections and any other criminal justice agency which may have a record of the conviction. After the order of expungement is entered, the petitioner shall be treated as not having been convicted of the crime, except that:
“(2) the petitioner shall disclose that the conviction occurred if asked about previous convictions (A) in any application for employment . . . with a criminal justice agency, as defined by K.S.A. 22-4701, and amendments thereto.” (Emphasis added.)
K.S.A. 1990 Supp. 12-4516(h) provides that the custodian of the records of an expunged conviction shall not disclose the existence of such records, except when requested by certain named persons or institutions. The relevant exception to the case at bar is when the records are requested by: “a criminal justice agency, private detective agency or a private patrol operator, and the request is accompanied by a statement that the request is being made in conjunction with an application for employment with such agency or operator by the person whose record has been expunged.”
K.S.A. 1990 Supp. 22-4701(c) defines “criminal justice agency” to include:
“(1) State, county, municipal and railroad police departments, sheriffs’ offices and countywide law enforcement agencies, correctional facilities, jails and detention centers.”
The sheriffs office is a criminal justice agency.
“It is the duty of the court to reconcile different statutory provisions so as to make them consistent, harmonious, and sensible. [Citation omitted.] General and special statutes should be read together and harmonized whenever possible, but to the extent a conflict between them exists, the special statute will prevail unless it appears the legislature intended to make the general statute controlling. [Citation omitted.]” Kansas Racing Management, Inc. v. Kansas Racing Comm’n, 244 Kan. 343, 353, 770 P.2d 423 (1989).
The county election officer is not specifically listed in K.S.A. 1990 Supp. 12-4516(h) as a person or agency authorized to receive records of expunged convictions. However, K.S.A. 19-826(c) authorizes the county election officer to receive such information.
K.S.A. 1990 Supp. 12-4516 does not specifically address the effect of an expungement of a liquor-related conviction on a candidate’s qualifications for sheriff. K.S.A. 1990 Supp. 12-4516 is a general statute dealing with expungement of convictions. It does not remove the fact of the convictions, but merely closes the records of the conviction to public scrutiny. K.S.A. 19-80lb and K.S.A. 19-826 specifically address qualifications for the office of sheriff and the method to determine prior disqualifying convictions. To the extent that K.S.A. 19-826(c) and K.S.A. 1990 Supp. 12-4516(h)(2) conflict, K.S.A. 19-826(c) controls. K.S.A. 19-826(c) is a specific statute dealing with the reporting of convictions to determine eligibility for being elected to the office of sheriff.
It would make little sense for the legislature to place a sheriff s deputies under closer scrutiny than the sheriff. In construing K.S.A. 1990 Supp. 12-4516 with K.S.A. 19-801b and K.S.A. 19-826, we hold that K.S.A. 19-801b and 19-826 control. A liquor-related conviction expunged under K.S.A. 1990 Supp. 12-4516 does not remove the K.S.A. 19-801b disqualification for the office of sheriff. The KBI properly reported Chamberlain’s convictions to Buhrman. Buhrman properly terminated Chamberlain’s attempt to become a candidate for sheriff.
The writ of mandamus is denied. | [
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The opinion of the court was delivered by
Lockett, J.:
This is an action for the recovery of underinsured motorist benefits. John E. Lavin was a passenger injured in a one-vehicle accident. Both the driver and the owner of the vehicle paid the liability limits of their policies in settlement with Lavin. Because Lavin’s underinsured motorist coverage limits exceeded the combined coverage of the two tortfeasors, Lavin made claim for underinsured motorist benefits against his own automobile liability insurance carrier, KFB Insurance Company, Inc. (KFB). That claim was denied by KFB on grounds the PIP benefits Lavin had collected from KFB exceeded his claim for underinsured motorist benefits. Lavin died three weeks before the trial court decision in favor of KFB. Lavin’s executor now appeals the trial court ruling that, pursuant to K.S.A. 40-284(e)(6), the insurer was entitled to set off the underinsured motorist benefits it owed against the nonduplicative PIP benefits it previously paid.
Lavin was a passenger in a car driven by Jimmy Roberts, which was involved in a single-car accident. The owner of the vehicle was insured by State Farm Insurance Company, with liability limits of $50,000. Roberts was insured by Farm & City Insurance Company through Mid-States Adjustment, Inc., with $25,000 liability limits. Each of those insurers paid the limits of its policy to plaintiff in settlement of its insured’s liability to Lavin.
Lavin was insured under four policies of automobile liability insurance, two with Farm Bureau Mutual Insurance Company, Inc., and two with KFB. Farm Bureau Mutual Insurance Company is not involved in this appeal.
Lavin received $31,167.52 of PIP wage loss benefits and $9,500 PIP medical benefits through KFB policy #FA65134, which had the highest PIP coverage. Lavin’s KFB policy #BC41159 had the highest underinsured motorist coverage with a limit of $100,000. Lavin’s underinsured motorist coverage exceeded the combined $75,000 liability coverages of the owner and driver of the vehicle ($50,000 + $25,000) by $25,000. The parties agree that the max imum liability coverage and PIP benefits plaintiff is entitled to receive is $177,000.
KFB denied the estate’s claim for $25,000 on grounds the $40,667.52 in PIP benefits it paid Lavin exceeded his $25,000 claim for underinsured motorist benefits; therefore, the $25,000 claim can be offset against the PIP benefits already paid. K.S.A. 40-284(e)(6).
Lavin’s insurance benefits were calculated as follows:
Liability $100,000
Lost Earnings 63,000 ($1,750 x 36 months)
Medical 9,500
Rehabilitation 4,500
$177,000
The parties stipulated that a court or jury would probably find Lavin’s actual damages exceeded $177,000. The parties also stipulated that none of the damages plaintiff claims under the underinsured motorist coverage are damages to which PIP benefits “apply.” Thus, the issue is whether Lavin’s estate is entitled to the $25,000 of underinsured motorist benefits or whether KFB is entitled to offset the $25,000 of underinsured motorist coverage against the nonduplicative PIP benefits it paid.
The trial court, relying on a literal reading of K.S.A. 40-284(e)(6), ruled the statute allows the insurer to reduce the underinsurance coverage by payments it already made for personal injury protection. The trial court held the $25,000 of underinsurance coverage could be set off against the PIP payments and, thus, KFB had no further liability to its insured. Lavin’s estate appealed, claiming K.S.A. 40-284(e)(6) allows setoff of the underinsured benefits only if the benefits are duplicative of the PIP benefits KFB previously paid.
In 1968, the Kansas Legislature enacted the uninsured motorist statute, K.S.A. 1968 Supp. 40-284. This statute allowed motorists who incurred damages in an automobile accident with an individual who had no automobile insurance to recover benefits for those damages from their own insurance company, up to the limits of their coverage. In 1981, the legislature. amended the law to include within the uninsured motorist statute provisions for cov erage for underinsured motorists. This section of the statute, K.S.A. 40-284(b), provides:
“Any uninsured motorist coverage shall include an underinsured motorist provision which enables the insured or the insured’s legal representative to recover from the insurer the amount of damages for bodily injury or death to which the insured is legally entitled from the owner or operator of another motor vehicle with coverage limits equal to the limits of liability provided by such uninsured motorist coverage to the extent such coverage exceeds the limits of the bodily injury coverage carried by the owner or operator of the other motor vehicle.”
The insurer charges a premium for uninsured motorist coverage and a separate premium for underinsured motorist coverage.
Other pertinent language of K.S.A. 40-284 allows an. insurer to exclude or limit its uninsured and underinsured motorist coverage “to the extent that personal injury protection benefits apply.” KFB’s insurance policies incorporate the statute’s language and state that coverage is not provided for bodily injury sustained by any person to the extent personal injury protection coverage applies.
PIP benefits apply to amounts for disability; funeral, medical, and rehabilitation expenses; substitution benefits; and survivor benefits. Intangible elements of damage, such as pain and suffering, disfigurement, and emotional distress are not covered by PIP benefits, but an injured person can recover such damages from the tortfeasor or, if the tortfeasor is underinsured, from the injured person’s underinsured motorist insurance carrier. K.S.A. 40-3103(q).
Plaintiff contends the trial court erroneously construed the plain language of K.S.A. 40-284(e)(6) to allow KFB to offset the underinsured motorist coverage benefits ágainst nonduplicative PIP benefits previously paid. Plaintiff further claims Lavin’s estate is entitled to the $25,000 underinsured motorist benefits from the insurer because Lavin paid a separate premium for the coverage and the underinsured motorist benefits are not duplicative of the PIP benefits and, therefore, K.S.A. 40-284(e)(6) does not allow a setoff.
Plaintiff maintains that if the underinsured motorist coverage benefits claimed are for those intangible elements óf'damage not covered by PIP, i.e,' damages to which PIP benefits do not “apply,” there is no double recovery. Plaintiff asserts if the legislature intended the limiting phrase “to the extent that [PIP] benefits apply” to mean “in an amount equal to the PIP benefits which the insured has received or is entitled to receive” the legislature could, should, and would have used a more specific phrase.
Plaintiff argues the trial court’s construction of the statute leaves persons who purchase the highest level of PIP coverage, coupled with a medium to low level of liability coverage, no uninsured/ underinsured, motorist coverage in spite of having paid a premium for the coverage. In such a situation, the insured obtains no uninsured/underinsured motorist coverage because the insurer can set off its entire limit of uninsured/underinsured motorist coverage against PIP coverage. Here, for example, Lavin’s potential PIP coverage was $77,000, but his underinsured motorist coverage after his recovery from the driver and the owner of the vehicle was only $25,000. Thus, the trial court’s ruling allows KFB to disclaim all responsibility for underinsured motorist coverage despite the fact that Lavin paid an additional premium to KFB for that $100,000 of coverage.
Plaintiff contends it was not the intent of the legislature to enact remedial legislation requiring insurers to extend both PIP and uninsured/underinsured motorist coverage to Kansas drivers, for which those insurers collect additional premiums, and at the same time permit those same insurers to deny nonduplicative coverage of their injured insureds.
KFB asserts the legislative history of the statute does not reflect an intention of the legislature to limit the effect of the statute to duplicative benefits and that recent attempts to amend the statute to include the word “duplicative” indicate that the current version of the statute allows exclusion of both nonduplicative and duplicative PIP benefits. KFB argues there is no ambiguity in the statute, which plainly states that both duplicative and nonduplicative PIP benefits the insurer has previously paid to its insured may be excluded from the underinsured motorist coverage. KFB’s argument that legislative history reflects an intention to allow exclusion of duplicative and nonduplicative PIP benefits is not persuasive. The legislative history is of no benefit in determining the scope and . meaning of 40-284(e)(6). Since the en actment of K.S.A. 40-284(e)(6), the Kansas Insurance Department has consistently taken the position that the legislative intent behind that statute was merely to prevent double recoveries by insureds and not to authorize a first-dollar setoff in cases where no duplication of recoveries would occur.
KFB contends two Kansas cases, Hetzel v. Clarkin, 244 Kan. 698, 772 P.2d 800 (1989), and Bardwell v. Kester, 15 Kan. App. 2d 679, 815 P.2d 120 (1991), are relevant and support its position that both duplicative and nonduplicative PIP benefits may be excluded from coverage. We disagree. KFB cites language on page 708 of Hetzel that “K.S.A. 1988 Supp. 40-284(e)(6) allows insurers to limit the coverage under the uninsured motorist provision to the extent that PIP benefits have been paid,” and concludes that language indicates that, in a case where damages were claimed to far exceed coverage, the court believed PIP benefits paid to plaintiff would be subject to setoff. KFB notes there is no indication in the court’s discussion that a “duplicative” threshold is to be considered prior to the limitation.
KFB’s conclusion as to what the court believed is unsupported by the language of the opinion. The statement in Hetzel referred to whether Hetzel had exhausted her remedies and could proceed under the Kansas Guaranty Act, K.S.A. 40-2905 et seq.
In Bardwell v. Kester, 15 Kan. App. 2d 679, Bardwell, a minor, was a passenger in an automobile driven by Gatlin. Gatlin’s automobile was struck by an automobile driven by Kester. Bardwell was hospitalized with injuries he received in the collision. Farmers paid him $8,213.37 in PIP benefits as a covered family member under a Farmers policy issued to his father. In a friendly suit, Bardwell agreed to settle with Gatlin for $5,000, with Kester for $25,000,- and with Farmers for $8,213.37. Farmers refused to pay the judgment under a setoff provision of its endorsement, authorized'-by K.S;A. 1990 Supp. 40-284(e)(6), which stated: “Any amount payable under the coverage shall be reduced by all sums payable for the same damages under any Personal Injury Protection.” The trial court ruled that Farmers was not required to pay the judgment entered against it. Bardwell appealed, contending that the setoff provision of the insurance contract did not apply. He maintained the specific language of the Farmers policy only allowed for a setoff of PIP benefits which are “payable,” not benefits already paid.
The Court of Appeals, after applying the rules for construction of an insurance contract, found that the only reasonable construction of the language was that the parties intended to reduce underinsured motorist coverage benefits by the amount of all benefits that eventually became payable prior to judgment. The Court of Appeals concluded that reading the contract otherwise would allow a duplicative payment. The application of K.S.A. 40-284(e)(6) to the PIP benefits paid by the insurer for the insured was not discussed in Bardwell.
The purpose of the legislation mandating the offer of uninsured and underinsured motorist coverage is to fill the gap inherent in motor vehicle financial responsibility and compulsory insurance legislation. This coverage is intended to provide recompense to innocent persons who are damaged through the wrongful conduct of motorists who, because they are uninsured or underinsured and not financially responsible, cannot be made to respond in damages. See Winner v. Ratzlaff, 211 Kan. 59, Syl. ¶ 1, 505 P.2d 606 (1973).
The uninsured and underinsured motorist statutes are remedial in nature. They should be liberally construed to provide a broad protection to the insured against all damages resulting from bodily injuries sustained by the insured that are caused by an automobile accident and arise out of the ownership, maintenance, or use of the insured motor vehicle, where those damages are caused by the acts of an uninsured or underinsured motorist. See Simpson v. Farmers Ins. Co., 225 Kan. 508, 512, 592 P.2d 445 (1979). Other states have similarly found their uninsured and underinsured motorist statutes are remedial in nature and should be liberally construed to provide broad protection. See American Service Mutual Insurance Co. v. Wilson, 323 So. 2d 645 (Fla. Dist. App. 1975); and Sinicropi v. State Farm Insurance Co., 55 App. Div. 2d 957, 391 N.Y.S.2d 444 (1977).
Uninsured and underinsured motorist coverage was developed by the Kansas Legislature as a means of protecting individuals from negligent uninsured or underinsured motorists. The purpose of K.S.A. 40-284 is to provide the individual who is covered by the standard automobile liability policy with a right against his or her own insurer equal to that the insured would have against the uninsured or underinsured tortfeasor. Van Hoozer v. Farmers Insurance Exchange, 219 Kan. 595, 600, 549 P.2d 1354 (1976). We hold the legislature intended K.S.A. 40-284(e)(6) to permit an insured to recover underinsured motorist benefits which are not duplicative of PIP benefits. Any other result negates the legislature’s intent to require underinsured motorist coverage protection.
Reversed and remanded for further proceedings. | [
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The opinion of the court was delivered by
Abbott, J.:
This is a direct appeal by Sedrick Scott from his convictions of two counts of aggravated battery, one count of aggravated assault, and one count of aggravated kidnapping.
Scott contends the State relied on a single and continuing act of force to form the basis of the aggravated assault and aggravated kidnapping charges. Scott also contends the trial court erred in refusing to give a requested instruction on compulsion and an additional aiding and abetting instruction. In addition, he claims the evidence is insufficient to support his conviction of aggravated kidnapping.
On September 7, 1989, thé victim, 14-year-old Charles Green, discussed selling drugs with LaMacey Woods. Woods was charged with several crimes arising out of these incidents, and his convictions were affirmed in State v. Woods, 250 Kan. 109, 825 P.2d 514 (1992). Woods gave Green $80 worth of crack cocaine, which green agreed to sell and then to give the proceeds from the sale to Woods. Green sold the cocaine and brought the money back to Woods. Woods then gave Green $40 worth of cocaine to sell. Green returned to his sister’s house.
About one hour later, someone came over to Green’s sister’s home and told Green that Woods wanted to see him. Green voluntarily returned to Woods’ house across the street. Woods and a man named Phil were outside working on Phil’s car. Green voluntarily went into Woods’ house with Woods and Phil. Woods directed Green to take a seat in the living room. There were several other people in the house, including Scott.
Woods inquired about the money from the cocaine Green was supposed to sell. Green explained he had not yet sold the cocaine and gave it to Woods. Woods told Green that this cocaine was not the cocaine he had given Green and that Green had “messed up his money.” Scott did not say anything while this was transpiring.
Green complied with Woods’ order for Green to follow Woods into a back room. Scott, Phil, and another man.followed Green into the room. In the back room, Woods began loading and unloading a gun. Scott, Phil, and the other man started hitting Green. Everyone in the room said he was going to kill Green. Green testified that Woods and Phil told Scott to hit Green and that this was the only occasion Scott hit him. At Woods’ direction, Scott tied Green’s hands behind his back with a bathrobe belt, and the men continued beating and kicking Green. Although no one directed him to do so, Scott took off Green’s shirt. Scott told Green to lie on his back, and then, upon Woods’ direction, told Green to turn over. After Woods burned Green’s back with a clothes iron, someone poured salt on the -wound. Scott cut Green’s arm with a razor blade; Phil then took the razor from Scott and said he would show Scott how to do it. Again, someone poured salt on the wound. Scott and the others continued hitting Green.
After someone put a gun to Green’s head to get him to stand up, Woods took Green into the bathroom and made him stand in a bathtub filled with water. Woods attempted to electrocute Green by dropping a curling iron into the water, but the cord was not long enough. Scott did not have anything to do with the attempted electrocution.
Woods then took Green back to the back room and shocked his feet with an extension cord. The extension cord was plugged into a wall outlet, and pieces of clothes hangers were plugged into the outlets on the cord. Scott did not participate. Green testified that Scott stood in the doorway and looked surprised.
Green again was beaten and then taken to the living room. Woods told Green he was now part of their “family” and could not go back home. Woods told Scott that Green was now Scott’s “man” or “shadow.” Green was directed to do whatever Scott told him to do. Woods told Scott to take Green with him to sell drugs.
Scott allowed Green to run across the street to his sister’s house for a few minutes. Green’s sister wanted to call the police, but Green told her not to because Woods and others present had stated that if Green told the police, they would kill him. Green was not sure whether Scott had participated in his verbal terrorizing.
Scott then took Green to a club where he bought Green a sandwich and a drink. When Green finished eating, Scott was gone. Green went home and the next day went to the hospital. He did not tell the police the truth about how he received his injuries.
On cross-examination, Green admitted that on the evening of September 7, he voluntarily returned to Woods’ house to see if Scott was there. Scott was not. Woods gave Green $200 worth of cocaine and said he would see Green in the morning.
On September 11, 1989, Green was at a club with friends. Around 6:30 or 7:00 p.m., Scott came into the club, put a .25 automatic into Green’s side, and told him that Woods was waiting for him outside. Green testified that Woods had sent Scott into the club to summon him.
Woods, who was standing by the door, put his arm around Green and said, “Let’s go.” Woods walked Green to Woods’ car. Woods drove the car. A man Green did not know was also in the front seat. Green, Scott, and another man with whom Green was not acquainted sat in the back seat. Green was sitting behind Woods with Scott to Green’s immediate right. Green testified that Scott still had the gun, but that Green could not see it. Green also testified that nothing prevented Scott from shooting or “doing anything” to Woods.
Woods drove back to his house, parked the car in the back yard, and told the others to wait in the car. Green testified there was nothing that stopped Scott from getting out of the car and leaving. Green did not get out of the car and leave because Scott was sitting next to him with the gun.
Woods returned to the car and ordered everyone out. They walked to the front of the house, with Woods leading the way. Green followed Woods and Scott was behind Green. Phil, who had been present for the September 7 attack, was waiting and, when Green walked by, started beating him with a pole.
Once inside the house, Woods, Scott, and another man took Green to the back room. Woods and possibly others told Green they were going to kill him this time. Green testified that Scott did not make such a statement.
On direct examination, Green testified that Woods was not in the room when Scott tied Green’s hands behind his back and ripped off Green’s shirt. Woods returned with a clothes iron and burned Green on his chest and stomach. The other man stabbed Green with a knife. Woods shocked Green with the extension cord device. Scott was “[j]ust standing around watching.” Woods then started beating Green’s legs with a sawed-off .12 gauge shotgun. People were yelling, “Break his legs.”
On cross-examination, Green testified that upon going to the back room, a man called Val started punching him. Woods returned with a .38 revolver and played Russian roulette with Green. Woods pulled the trigger four or five times with the weapon pointed at Green’s head and then fired the final bullet into the floor. Green testified that Scott appeared to be frightened of Woods while this was happening. Woods then unloaded a sawed-off shotgun and started hitting Green with the butt of the gun. The record is not clear, but it appears Scott was not present all the time, having left the room during part of the torture.
Woods then took Green outside. Scott and others were present. They made Green take off all of his clothing. Phil hit Green in the eye with the butt of a gun. They locked Green in the car trunk. Later, Scott checked on Green to see if he was okay. Green told Scott he was cold. About an hour later, Scott returned with clothing and food. Green testified that Scott appeared to be concerned and was the only one trying to help him.
Woods finally came out and released Green from the trunk about 2:30 a.m. Woods drove Green to a hospital, but did not stop because police were in the vicinity. Woods took Green to a motel and told him someone would pick him up in the morning. When no one came to pick him up, Green called his uncle, who took him to the hospital. Green spent six days in the hospital.
1. Multiplicity
Scott claims that the State, in its opening and closing arguments, relied upon Scott putting a gun to Green’s side on September 11, 1989, to support his convictions of aggravated kidnapping (count three) and aggravated assault (count four). Scott maintains that because the State rélied upon this single and continuing act of force to support both charges, his convictions on counts three and four are multiplicitous.
The record does not support the argument that the State only relied upon Scott putting a gun to Green’s side to support the aggravated kidnapping charge.
In opening argument, the prosecutor stated:
“Count three [aggravated kidnapping] is an allegation that on the 11th day of September this defendant once again took Charles Green and confined him with the intent to terrorize him and with the intent to do bodily harm. Count four is the crime of aggravated assault where this defendant took a .25 caliber automatic hand gun and advised this defendant [sic] that he was to come with him or he was going to be shot.”
In closing argument, the prosecutor stated:
“[A] couple of days later on the 11th of September [Green] was down on 9th Street in one of the clubs down there. He testified and told us that this defendant came in to that club and produced what he felt was a .25 caliber automatic pistol, stuck it in his side and said [Woods] wants to see you outside and forced him out of that club.
“[Green] testified and told us that the defendant had the gun and forced him over to a car where LaMacey Woods was waiting and they all got in the car. This defendant was in the back seat with him still with the gun in his hand. [Green] testified and told us that they drove him back to this house on Minneapolis ... at that time took him back into the house ....
“He testified that all of the individuals that were there, including this defendant and LaMacey Woods, then had him go back to the back bedroom. Once again this defendant tied his hands, once again this defendant removed his shirt and once again LaMacey Woods started doing his feet. [Green] testified that this time Wood[s] burned him on the chest ....
“[Green] testified and told us that he was also stabbed several times in both arms, in his right arm and in his left arm. He indicated he also received a wound to his hand. He testified and told us that there was water placed in the bathtub, that Woods was going to drop an electric item, a curling iron or something into the water and shock him or electrocute him but the cord wasn’t long enough. But once again, he was shocked on the bottom of the feet with the electrical cord.”
After the prosecution rested, defense counsel argued that the court should dismiss count four:
“I would suggest to the Court that [count four] merges with count three .... The State is alleging that my client took the gun and pointed it at Mr. Green to get him out of the club, which is exactly, minus one element, the same elements and crime as contained in count three of aggravated kidnapping. I would argue that that is duplicitous, because it’s the same act being charged as two separate crimes, the aggravated kidnapping and the aggravated assault.”
In response, the prosecutor argued that assault and kidnapping were two separate acts, distinct from each other. The court overruled the defendant’s motion.
The State did not rely upon a single act of force. However, even if the State had relied upon a single act of force in its arguments to the jury, opening and closing arguments are not evidence. See State v. Brown, 181 Kan. 375, 394, 312 P.2d 832 (1957). Here, the issue is not the content of the State’s arguments, but whether the evidence supports a finding that the same act constituted the force element for both crimes.
In State v. Woods, 250 Kan. 109, 119-20, 825 P.2d 514 (1992), we stated:
“ ‘Multiplicity exists when the State uses “a single wrongful act as the basis for multiple charges.” [Citation omitted.] Charges are not multiplicitous if each charge requires proof of a fact not required in proving the other. [Citation omitted.] . . . Offenses are also not multiplicitous when they occur at different times and different places, because they cannot then be said to arise out of a single wrongful act.’ State v. Howard, 243 Kan. 699, 703, 763 P.2d 607 (1988).
See State v. Zamora, 247 Kan. 684, 694, 803 P.2d 568 (1990) (‘Where offenses are committed separately and severally at different times and at difference places, they cannot be said to arise out of a single wrongful act.’); State v. Garnes, 229 Kan. 368, 373, 624 P.2d 448 (1981) (same); Wagner v. Edmondson, 178 Kan. 554, 556, 290 P.2d 98 (1955) (‘[T]he test for determining whether a continuous transaction results in the commission of but a single offense ... is determined by whether separate and distinct prohibited acts, made punishable by law, have been committed.’); see also Davis v. State, 210 Kan. 709, 713, 504 P.2d 617 (1972) (‘[A] single motive for a series of acts does not necessarily result in a single crime.’).
“Multiplicity in the crimes charged exists if the crimes charged are based on ‘a series of violent acts occurring] simultaneously.’ State v. Cathey, 241 Kan. 715, 720, 741 P.2d 738 (1987); see State v. Smith, 245 Kan. 381, 392, 781 P.2d 666 (1989). This court has found offenses multiplicitous if the ‘defendant’s conduct constituted a single continuous transaction’ or ‘one continuing unbroken act of force.’ State v. Bishop, 240 Kan. 647, 653-54, 732 P.2d 765 (1987).
“Multiplicity does not exist if an act of violence is intermittent or separate and wholly unrelated to the other acts of violence. State v. Bourne, 233 Kan. 166, 168, 660 P.2d 565 (1983). If there is a ‘break in the action’ or if ‘offenses occurred at separate times and in separate places,’ the charges are not multiplicitous. Bishop, 240 Kan. at 653-54; see State v. James, 216 Kan. 235, 531 P.2d 70 (1975).”
The crimes committed by Scott were separated by time and distance and were not a part of a common scheme, such as carrying out a sexual assault, a robbery, or an attempted murder. As in Woods, the defendant in this case intended to, and did, participate in separate crimes. The State did not rely on a single and continuing act of force to form the basis of both aggravated assault and aggravated kidnapping.
2. Compulsion Defense
Scott argues that all acts in which he participated on September 7 and 11, 1989, were because he was terrorized by and in fear of Woods. Scott did not testify, but based upon Green’s testimony, Scott maintains the trial court should have instructed the jury on the defense of compulsion.
“In a criminal action, a trial court must instruct the jury on the law applicable to the theories of all parties where there is supporting evidence. When considering the refusal of a trial court to give a specific instruction, the evidence must be viewed by the appellate court in the light most favorable to the party requesting the instruction.” State v. Burgess, 245 Kan. 481, Syl. ¶ 1, 781 P.2d 694 (1989).
The defense of compulsion is governed by K.S.A. 21-3209, which provides:
“(1) A person is not guilty of a crime other than murder or voluntary manslaughter by reason of conduct which he performs under the compulsion or threat of the imminent infliction of death or great bodily harm, if he reasonably believes that death or great bodily harm will be inflicted upon him or upon his spouse, parent, child, brother or sister if he does not perform such conduct.
“(2) The defense provided by this section is not available to one who willfully or wantonly places himself in a situation in which it is probable that he will be subjected to compulsion or threat.”
The Judicial Council’s comment to K.S.A. 21-3209(2) specifies that “[s]ubsection (2) creates an exception for the person who connects himself with criminal activities or is otherwise indifferent to known risk.”
In State v. Hunter, 241 Kan. 629, Syl. ¶ 10, 740 P.2d 559 (1987), this court discussed application of the compulsion defense:
“In order to constitute the defense of compulsion, the coercion or duress must be present, imminent, and impending, and of such a nature as to induce a well-grounded apprehension of death or serious bodily injury if the act is not done. The doctrine of coercion or duress cannot be invoked as an excuse by one who had a reasonable opportunity to avoid doing the act without undue exposure to death or serious bodily harm. State v. Milum, 213 Kan. 581, 582, 516 P.2d 984 (1973). In addition, the compulsion must be continuous and there must be no reasonable opportunity to escape the compulsion without committing the crime. State v. Myers, 233 Kan. 611, 664 P.2d 834 (1983).”
See also State v. Pichon, 15 Kan. App. 2d 527, 811 P.2d 517 (1991), rev. denied 249 Kan. 778 (1991) (compulsion defense applied to escape from lawful custody).
In his brief, Scott claims Green and he held essentially the same position in the Insanes or Crips organization. Scott suggests the only difference is that he was already a member of the group, whereas Green was still in the recruitment state. Scott argues Woods
“ruled his underlings in a way that made them totally dependent upon him for their needs. [Woods] required his recruits to hand over to him all proceeds from the cocaine they sold so they could in Woods’ words, ‘work up enough money.’ [Woods] provided motel rooms where they spent most of their nights. They [were not] allowed to see their own families once they became a member of [Woods’] ‘family.’ [Woods] punished those who did not follow his orders. . . . [Y]oung men like [Scott] and [Green] were induced, through financial and emotional dependence, and most importantly, through fear, to do exactly what [Woods] ordered them to do. . . . This financial and emotional dependency upon and fear of Macey Woods, once established, rendered any conceivable opportunity to escape from his grasp quite unlikely.”
Green testified that Woods told people what to do and that he punished people who did not act accordingly. Scott’s argument that Woods required his recruits to hand over all proceeds, that he provided motel rooms for all, and that they were not allowed to see their own families once they joined his “family” pertains to Green’s testimony about what happened specifically to him. Although Green stated that Scott stayed mainly in motels, Green did not testify that Woods provided a motel room for Scott.
Regardless of the veracity of Scott’s argument that he and others were emotionally and financially dependent upon Woods, Green’s testimony does not support the argument. Green’s testimony does not support the contentions that Scott was suffering present, imminent, or impending coercion or duress, that Woods’ intimidation of Scott was continual, or that Scott had a reasonable apprehension of death or serious bodily injury if he did not participate in the attacks upon Green. There is evidence that Scott had a reasonable opportunity to escape. After the September 7 attack, Scott took Green to a club; Woods remained at his house. Scott did not live at Woods’ house. Scott had his own car. Nonetheless, Scott returned with Woods to the club on September 11. Although Green testified Woods told Scott to summon Green, there is no evidence that Woods told or forced Scott to pull the gun on Green.
It appears Scott and Woods often went their separate ways. In State v. Dunn, 243 Kan. 414, 422, 758 P.2d 718 (1988), this court ruled that if the intimidation is not continuous and if there is a reasonable opportunity to escape, the defendant cannot claim he “was compelled to be present when the crimes were committed.”
The only witness called on Scott’s behalf was Woods. Woods’ testimony consisted of his name, the fact he had been residing for two weeks at the Sedgwick County Detention Facility for a crime he allegedly committed, and the fact he had been extradited from California to face charges. Scott did not testify.
Scott contends the prosecutor “took advantage of the absence of an instruction on the compulsion defense and misled the jury.” The main thrust of defense counsel’s closing argument was that Scott’s alleged acts were neither voluntary nor intentional. In response, the prosecutor argued that “counsel for the defendant is appealing to your sympathies. The Court says nothing in here whatsoever about any defense for a criminal action being that someone else made me do it. . . . That’s not a defense to a criminal action.”
The State argues the prosecutor’s remarks were simply a reminder that the jury was obligated to follow the trial court’s instructions. Furthermore, according to the State, the jury was not misled because the court previously had ruled that the compulsion defense was not available to Scott.
Scott also claims the need for a compulsion instruction was evidenced by the jury’s request for a read-back of “the testimonial evidence by Charles Green pertaining to the fear of [Woods] possessed by Sedrick Scott.” Mere fear will not support a compulsion defense instruction.
Additionally, Scott knowingly associated himself with the selling of drugs, á criminal activity, and with a gang noted for violence. The trial court did not err in refusing to give an instruction on the defense of compulsion.
3. Association with Principals
The trial court gave the following instruction on responsibility for the crimes of another:
“A person who, either before or during its commission, intentionally aids, abets, advises or counsels another to commit a crime with intent to promote or assist in its commission is criminally responsible for the crime committed regardless of the extent of the defendant’s participation, if any, in the actual commission of the crime.”
See PIK Crim. 2d 54.05; K.S.A. 21-3205(1).
(The only differences between the instruction given and the PIK instruction is the omission of the words “hires” and “procures” before and after, respectively, the wprd “counsels.”)
The trial court denied Scott’s request that the following instruction also be given: “Mere association with principals who actually commit the crime or the mere presence in the vicinity of [the] crime are themselves insufficient to establish guilt as [an] aider and abettor.”
Although Scott admits there is no PIK instruction embodying his requested instruction, he argues that his requested instruction is based on a well-settled principle of law. Furthermore, the defendant claims the lack of this instruction impeded the jury in performing its duties to the best of its abilities. Scott argues that if the jury had received this instruction, it reasonably could have inferred that Scott did not “intentionally aid and abet in the commission of the crimes charged against him.”
In State v. Hunter, this court addressed the same issue raised by Scott and stated:
“Although [this court has] held that mere association with principals is not sufficient to establish guilt as an aider and abettor, [we have not] mandated the giving of such an instruction. . . . [We have] held that the PIK [Crim. 2d 54.05] instruction given clearly informed the jury that intentional acts by a defendant must be proved to convict for aiding and abetting and, thus, proof of mere association or presence would be insufficient to convict. Therefore, the refusal to give defendant’s requested instruction was not error.” 241 Kan. at 639.
See also State v. Crabtree, 248 Kan. 33, Syl. ¶ 6, 805 P.2d 1 (1991) (“Error cannot be predicated on the refusal to give specific instructions where those which were given cover and include the substance of those refused.”). The trial court did not err in refusing to give the requested instruction.
4. Sufficiency of Evidence.
Scott argues that the State relied upon an aiding and abetting theory to convict him of aggravated kidnapping and that in order for a jury to convict him of aggravated kidnapping pursuant to an aiding and abetting theory, the jury had to find that at the time Scott committed the aggravated assault upon Green, Scott shared the intent of Woods and others to inflict bodily harm upon Green. Scott claims there was no evidence to this effect.
Our scope of review is:
“When the sufficiency of the evidence is challenged in a criminal case, the standard of review on appeal is whether, after review of all the evidence, viewed in the light most favorable to the prosecution, the appellate court is convinced that a rational factfinder could have found the defendant guilty beyond a reasonable doubt.” State v. Dunn, 249 Kan. 488, Syl. ¶ 1, 820 P.2d 412 (1991).
To convict Scott of aggravated kidnapping, the jury had to find that Scott held Green with the intent to inflict bodily harm or to terrorize. Under the aiding and abetting theory, Scott was criminally liable for the crime of aggravated kidnapping if he intentionally aided, abetted, advised, or counseled another to commit the crime.
“ ‘It is the rule in this state that mere association with the principals who actually commit the crime or mere presence in the vicinity of the crime are themselves insufficient to establish guilt as an aider and abettor; however, when a person knowingly associates himself with the unlawful venture and participates in a way which indicates he willfully is furthering the success of the venture, such evidence of guilt is sufficient to go to the jury.’ ” State v. Buckland, 245 Kan. 132, 140, 777 P.2d 745 (1989) (quoting State v. Burton, 235 Kan. 472, 477, 681 F.2d 646 [1984]).
“ ‘Intent is a state of mind existing at the time a person commits an offense and it may be shown by acts, circumstances and inferences deducible therefrom.’ [Citations omitted.]” State v. Royal, 234 Kan. 218, 225, 670 P.2d 1337 (1983). A conviction of even the gravest offense may be sustained by circumstantial evidence. State v. Hupp, 248 Kan. 644, Syl. ¶ 5, 809 P.2d 1207 (1991).
A jury could find that Scott committed aggravated kidnapping based upon the following facts: When Woods drove the car back to his house, Green, Scott, and a man with whom Green was not acquainted sat in the back seat. Green was sitting behind Woods with Scott to Green’s immediate right. Green testified that Scott still had the gun. When asked what Scott was doing with the gun, Green stated, “I don’t know, I didn’t see.” When they arrived at the house, Woods told everyone to wait in the car. Green testified that he did not get out of the car and leave because Scott was sitting next to him with the gun. Woods returned to the car and ordered everyone out. Woods led the way, followed by Green who was followed by Scott. Phil, who had been present for the September 7 attack, was waiting and, when Green walked by, started beating him with a pole. Scott and others took Green to the back room. Scott tied Green’s hands behind his back and took or ripped off Green’s shirt. Green was then beaten, burned with an iron, stabbed with a knife, shocked with an extension cord device, and forced to play Russian roulette.
A jury also could find that Scott knowingly associated himself with the unlawful venture and that Scott’s participation indicated he willfully furthered the success of the venture. The jury could take into account that Scott participated in the September 7 attack upon Green. A jury could infer that Scott could have disassociated himself from Woods and the crimes perpetrated upon Green because Scott had his own vehicle and gun. Furthermore, Scott was not consistently in the company of Woods; thus, Scott had ample opportunities to escape or to contact the authorities.
Scott argues Green’s testimony that Scott appeared frightened or shocked and that Scott appeared concerned negates any inference of criminal intent. The jury heard the evidence and came to an opposite conclusion, as was the jury’s prerogative.
There is sufficient evidence to support Scott’s conviction of aggravated kidnapping.
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Per Curiam:
This is an original proceeding in discipline filed by the office of the disciplinary administrator against J. William Stapleton, of Overland Park, an attorney admitted to the practice of law in Kansas. Two separate complaints were filed against respondent, which have been consolidated for hearing before this court.
In Case No. 66,548, the complainant was Rheta Slawson, executrix of the Ralph E. Harbour Estate. The complaint alleged that respondent accepted employment to perform the necessary legal work to administer the estate of complainant’s father, failed to do so, and failed to communicate with complainant. Further, respondent failed to cooperate with the disciplinary administrator. This case will be referred to as the “Slawson matter.’’
Case No. 67,066 was initiated by the disciplinary administrator’s office as a result of testimony given by respondent in the hearing on the Slawson matter. The complaint alleges that respondent misappropriated estate funds, gave false testimony concerning these funds to the hearing panel of the Kansas Roard for Discipline of Attorneys in the Slawson matter, and failed to cooperate with the disciplinary administrator.
In neither case are the factual findings or conclusions of the hearing panel contested. The only exception raised by respondent is to the recommendation of the hearing panel that he be indefinitely suspended from the practice of law.
In the Slawson matter, the panel unanimously found as follows:
1. Respondent J. William Stapleton, Kansas Attorney Registration No. 08063, is an attorney whose last registration address with the Clerk of the Appellate Courts of Kansas is 4550 West 109th Street, Suite 230, Overland Park, Kansas 66211. He was admitted to practice in Kansas in 1973.
2. On March 22, 1989, Ralph Edward Harbour died, leaving a will which named his daughter, Rheta E. Slawson, an Ohio resident, as executrix. Respondent was the scrivener of the will.
3. On March 24, 1989, Mrs. Slawson met with respondent and retained him to probate her father’s estate. Mrs. Slawson paid a fee of $1,000.00. Mr. Stapleton agreed to provide the requested services at that fee although he told Mrs. Slawson his usual fee was an hourly rate of $100.00.
4. By letter dated March 27, 1989, Mrs. Slawson notified Mr. Stapleton of the names and addresses of the heirs and sought confirmation that Mr. Stapleton would file the estimated income tax returns for 1989.
5. Mrs. Slawson did not hear from Mr. Stapleton, and on May 8, 1989, she wrote to Mr. Stapleton inquiring generally about the status of the case and asked specifically whether the Petition for Probate of Will had been filed and whether he had opened an account to pay bills.
6. Mrs. Slawson repeatedly wrote to Mr. Stapleton with specific questions and/or requests, and Mr. Stapleton failed to take the necessary and/or requested action and failed to contact Mrs. Slaw-son. Specifically:
(a) On May 30, 1989, Mrs. Slawson wrote to Mr. Stapleton, supplying him with information necessary to remove her brother’s name from two stock certificates pursuant to an earlier conversation concerning the same matter. Respondent never told Mrs. Slawson this request could not be honored.
(b) On June 19, 1989, Mrs. Slawson wrote to Mr. Stapleton seeking information on the bank accounts, on payment of her father’s bills, and on the status of an appraisal on a lot that was to be sold.
(c) On July 3, 1989, Mrs. Slawson met with Mr. Stapleton and inquired as to the status and progress being made in the case. Mr. Stapleton told Mrs. Slawson that he expected the court to act in one week. At this point in time Mr. Stapleton had not even filed the Petition for Probate of Will, and no proceeding was pending.
(d) On July 17, 1989, Mrs. Slawson again wrote and inquired as to setting up a checking account and paying bills. She expressed her desire to get the estate proceedings moving and to hear from Mr. Stapleton.
(e) On July 21, 1989, the Petition for Probate of Will was filed in the District Court of Wyandotte County, Kansas, Case No. 89-P-394, In the Estate of Ralph E. Harbour.
(f) On September 18, 1989, Mrs. Slawson again wrote to Mr. Stapleton concerning a lot, payment of bills, and removing her brother’s name from the two stock certificates.
(g) On November 12, 1989, Mrs. Slawson requested information about the lot and removing her brother’s name from the stock certificates. She requested that Mr. Stapleton acknowledge receipt of her prior letter, which contained dividend checks. She also enclosed a tax bill for the lot.
(h) Soon thereafter Mrs. Slawson and Mr. Stapleton had a telephone conversation concerning removing Mrs. Slawson’s brother’s name from the stock accounts and payment of bills. Mr. Stapleton told Mrs. Slawson that the court had approved payment of the bills. On November 27, 1989, Mrs. Slawson wrote to Mr. Stapleton confirming the telephone call and requested a list of bills approved for payment by the court. At this point in time respondent had not filed a Petition for Approval of Demands, the court had not signed an order approving payments, and no such pleading was filed until January 17, 1990.
7. Mrs. Slawson also made numerous telephone calls to Mr. Stapleton that were not returned.
8. Sometime after January 18, 1990, Mr. Stapleton moved his offices but did not inform Mrs. Slawson. She learned of the move when she placed a telephone call to Mr. Stapleton’s former number and was advised by a secretary of Mr. Stapleton’s new number.
9. On February 9, 1990, Mrs. Slawson wrote to Mr. Stapleton directing him to call upon receipt of the letter and to answer certain questions by February 23, 1990. This letter was sent by certified mail and a copy was sent by regular mail. Mr. Stapleton did not call nor did he respond to the questions.
10. On February 15, 1990, Mrs. Slawson contacted H. Reed Walker, Chairman of the Wyandotte County Bar Association Grievance and Ethics Committee. Mr. Walker wrote to Mr. Stapleton on February 17, 1990, informing him of Mrs. Slawson’s concerns and urging him to contact Mrs. Slawson. Mr. Walker also called Mr. Stapleton on February 19, 1990. Mr. Stapleton did not contact Mrs. Slawson.
11. On March 23, 1990, Mrs. Slawson wrote to Mr. Stapleton, requesting information on the status of the estate and informing him that if the information was not provided by April 3, 1990, that he was removed as her attorney. Mr. Stapleton did not respond.
12. During the period in which Mr. Stapleton represented Mrs. Slawson (March 27, 1989, to April 3, 1990) he sent only three pieces of correspondence to Mrs. Slawson.
13. The Petition for Probate of Will and Issuance of Letters Testamentary was not sent to Mrs. Slawson for signature until May 15, 1989, two months, after Mr. Stapleton was retained, and was not filed with the court until July 21, 1989, two months after his client executed it and returned it to him.
14. The inventory was not filed until January 17, 1990, although K.S.A. 1990 Supp. 59-1201 provides that the Inventory and/or Valuation shall be filed within 30 days after the date of a personal representative’s Letters of Appointment, unless a longer time has been granted by the court. No additional time was requested or granted. The inventory that was filed contained numerous errors.
15. Also on January 17, 1990, Mr. Stapleton filed a Report of Demands And Petition for Approval, indicating that he had paid certain debts of the deceased and seeking court approval. He obtained the judge’s signature on an order approving the demands and finding that his payment of these, debts was proper. As of January 17, 1990, Mr. Stapleton had not paid any of the four debts he had listed. The report also failed to list two creditors.
16. The Report of Demands and Petition for Approval referred to above was the last pleading filed by Mr. Stapleton. However, Mr. Stapleton told Sally Harris, the attorney assigned to investigate this complaint, that the matter had been set for final hearing in May 1990.
17. The decedent, Mr. Harbour, had sold a house on a contract providing for installment payments. The buyers’ monthly payment was deposited into an account which bore the names of the decedent, the buyer, Pamela Johnson, and the buyer’s mother, Martha Ruppel, who took care of the decedent. Mrs. Slawson notified Mr. Stapleton of these facts, but Mr. Stapleton failed to take any action. After Mr. Harbour’s death, the buyers made payments into this account through June 1989. On July 11, 1989, the account was closed by Mrs. Ruppel, and the balance of $14,938.61 was deposited into a new account bearing the names of Mrs. Ruppel, her husband, and Mrs. Johnson. No action was ever taken by Mr. Stapleton to recover any portion of these funds.
18. Mr. Stapleton also failed to file the Kansas Inheritance Tax Return due on December 22, 1989, or the 1989 Federal Income Tax Return for the decedent, and a 1989 Fiduciary Income Tax Return. Mrs. Slawson obtained the services of a certified public accountant who obtained an extension and filed the income tax returns.
19. Mr. Stapleton told Mrs. Slawson that he would open a checking account for the estate. An account was not opened until September 15, 1989, when a checking account was opened at Colonial Savings. Another account was opened on October 25, 1989, at Overland Park State Bank and Trust (OPSB). Mrs. Slaw-son sent checks made payable to the decedent to Mr. Stapleton on the following dates in the following amounts, and the checks were not deposited in a timely manner:
Date Sent Amount Date of Deposit Place of Deposit
April 24, 1989 $141.88 September 15, 1989 Colonial Savings
April 24, 1989 555.00 September 15, 1989 Colonial Savings
May 8, 1989 725.52 September 15, 1989 Colonial Savings
Sept. 16, 1989 725.52 October 25, 1989 OPSB
Nov. 7, 1989 541.68 January 11, 1990 OPSB
Nov. 12, 1989 183.84 January 11, 1990 OPSB
20.On October 31, 1989, Mr. Stapleton closed the account at Colonial Savings and received a check made payable to the Estate of Ralph Harbour for $1,422.40. This check was endorsed by Mr. Stapleton and deposited into his trust account. No accounting was ever made by Mr. Stapleton to Mrs. Slawson for these funds and the funds were not returned by Mr. Stapleton until the February 13, 1991, hearing on this complaint.
21. By letter dated March 23, 1990, Mrs. Slawson directed Mr. Stapleton to turn over all files, stock certificates, stock dividend checks, debentures, property titles, checking account records, and any other items or information relating to the estate to Hylton Harmon, the attorney she hired to replace respondent.
22. On April 13, 1990, Sally Harris spoke with Mr. Stapleton by phone and directed him to turn over all such assets and the file to Mr. Harmon. By letter dated April 16, 1990, Ms. Harris confirmed this telephone conversation and directed that these documents be given to Mr. Harmon.
23. Mr. Stapleton failed to contact Mr. Harmon and failed to turn over the assets of the estate and the file to Mrs. Slawson or to Mr. Harmon.
24. By letter dated March 7, 1990, Bruce E. Miller notified Mr. Stapleton of the complaint and requested a response within seven days. The letter was sent to 8676 West 96th Street, Suite 100, Overland Park, Kansas 66212. This was the address then on file with the Clerk of the Appellate Courts. No response was received.
25. The matter was referred to Sally Harris for investigation. Ms. Harris wrote to Mr. Stapleton on March 15, 1990, and on April 10, 1990, requesting a response. No response was received.
26. On April 13, 1990, Ms. Harris telephoned Mr. Stapleton, who stated that he knew nothing of the investigation. He stated that he would be preparing a response. This agreement for respondent to prepare a written response to the complaint was confirmed in a letter dated April 16, 1990, from Ms. Harris to Mr. Stapleton. No response was ever received.
27. On April 19, 1990, Mr. Miller mailed a copy of the letter of complaint and a copy of his letter of March 7, 1990, to Mr. Stapleton at 4550 West 109th Street, Suite 230, Overland Park, Kansas 66211. No response was received.
28. Jack Ford, investigator for the disciplinary administrator’s office, went to the office of Mr. Stapleton and requested information on the estate’s bank accounts. Mr. Stapleton agreed to provide the information on September 12, 1990. Respondent failed to provide this information until around January 19, 1991.
The panel then concluded that respondent had violated Supreme Court Rule 226, Model Rules of Professional Conduct (1991 Kan. Ct. R. Annot. 222), as follows:
1. MRPC 1.1 (1991 Kan. Ct. R. Annot. 228), by failing to represent the client competently in that he failed to determine the applicable law, to prepare, to refer the case to other counsel, or to seek assistance from a lawyer familiar with probate practice;
2. MRPC 1.2 (1991 Kan. Ct. R. Annot. 229), by failing to abide by his client’s lawful decision to transfer the probate proceeding to other counsel;
3. MRPC 1.3 (1991 Kan. Ct. R. Annot. 232), 1.4 (1991 Kan. Ct. R. Annot. 234), and 3.2 (1991 Kan. Ct. R. Annot. 275), by failing to act promptly and diligently in starting or completing the probate proceeding and by failing to keep his client informed;
4. MRPC 1.15(b) (1991 Kan. Ct. R. Annot. 263), by failing to advise Mrs. Slawson of his possession of money belonging to the estate and by failing to promptly account for and pay over that money;
5. MRPC 1.16(a)(3) (1991 Kan. Ct. R. Annot. 267), by failing to withdraw as counsel for Mrs. Slawson upon being terminated, and MRPC 1.16(d) (1991 Kan. Ct. R. Annot. 267), by failing to turn over the file and cooperate with subsequent counsel;
6. MRPC 8.4(g) (1991 Kan. Ct. R. Annot. 308), by engaging in conduct which adversely reflects on his fitness to practice law; and
7. Supreme Court Rule 207(a) and (b) (1991 Kan. Ct. R. Annot. 149), by failing to assist or cooperate in the disciplinary administrator’s investigation of this complaint.
In mitigation, respondent, through counsel, stated that he was unfamiliar with probate law, that the fee was less than an attorney who is experienced in probate practice would charge, and that he was making a good faith effort to do the work. Respondent testified that he had recently started to see a counselor to deal with his depression. He attributed his failure to cooperate to “burnout” from answering previous letters of complaint. Respondent stated that he sought counseling after a disciplinary hearing in September 1990 because he had thoughts of suicide.
In aggravation, the panel was informed that, although restitution of the fee and thfe estate funds had been made, this was not done until the date of the disciplinary hearing and that respondent had had prior discipline, including an informal admonition, a public censure, and a case pending before this court in which suspension was recommended. The pending case has now been decided by this court, and respondent has been suspended for one year, effective October 25, 1991. In re Stapleton, 249 Kan. 524, 819 P.2d 125 (1991).
After considering evidence in aggravation and mitigation, the panel in the Slawson matter recommended that respondent be indefinitely suspended from the practice of law and that costs be assessed to respondent.
In Case No. 67,066, the hearing panel unanimously found as follows: •
1. Respondent opened an account at Colonial Savings on September 15, 1989, in the name of the Estate of Ralph E. Harbour and made an initial deposit of $1,422.40.
2. On October 31, 1989, respondent closed the account at Colonial Savings, received a check in the amount of $1,422.40 made payable to the Estate of Ralph E. Harbour and J. William Stapleton, endorsed that check, and deposited it into his trust account, account number 736-6, at the Overland Park State Bank.
3. Rheta Slawson was the executrix of the Estate of Ralph E. Harbour, deceased. Respondent returned the estate funds in the amount of $1,422.40 to Mrs. Slawson on February 13, 1991, at a hearing before the Board.
4. During the hearing held on February 13, 1991, in Case No. B-4875, respondent stated that the $1,422.40 belonging to the estate of Ralph E. Harbour had remained in his trust account from the date of its deposit on October 31, 1989, until it was paid to Mrs. Slawson on February 13, 1991. He further testified that if the balance was less than $1,422.40 in his trust account during this period, it would have “been something like a dollar” for service charges.
5. On the same date that the funds from the Harbour estate were deposited in his trust account, October 31, 1989, respondent wrote a check to Hartford Insurance Company in the amount of $2,364.30 noting on the check that the money was for “Abram.” This left a balance in his trust account of $9.28. The balance in respondent’s trust account remained less than $20.99 from Qc tober 31, 1989, until December 21, 1989 when a deposit of funds for another client in the amount of $5,053.50 was made to the account.
6. Respondent contends that there was an error in his trust account by reason of his having overpaid the sum of $1,425.00 sometime during 1987 or early 1988. Even if that were true, and the panel had no evidence on this other than respondent’s testimony, it seems clear that an additional $1,425.00 in the trust account would still leave the account considerably short of clients’ hinds deposited in the account during the relevant time period.
7. On March 5, 1991, the disciplinary administrator wrote respondent at his registered address requesting an explanation of the apparent deficiency in his trust account. No response was received.
8. On March 22, 1991, a letter was personally delivered to respondent from the disciplinary administrator’s office requesting that he respond to the March 5, 1991, letter within 10 days. No response was made.
The panel then concluded that respondent had violated the following Model Rules of Professional Conduct:
1. MRPC 1.15(a) and (d), by failing to properly maintain the funds of clients paid to him in an identifiable trust account;
2. MRPC 8.4(c), by engaging in conduct misrepresenting the funds held in his trust account;
3. MRPC 8.4(d), by engaging in conduct prejudicial to the administration of justice; and
4. Supreme Court Rule 207, by failing to properly assist the disciplinary administrator in the investigation of the complaint.
In mitigation, respondent testified that he had been involved in counseling at Johnson County Mental Health Center since July 1991 with Darrell Miller, a licensed social worker. He had seen Mr. Miller on two occasions. He had seen Dr. Jon Holman, Medical Director, once to obtain a prescription for an antidepressant.
Respondent further testified that he had also been in counseling with Dr. Edward Downs in 1987, but that this was for counseling in anticipation of marriage, and that in January 1991 he met with Dr. Grossman but did not continue with that counseling.
Respondent attributed his current depression to the death of his father from cancer in 1982, separation from his wife in 1983, divorce in 1985, termination of a serious relationship in 1988, and removal of skin cancers in 1989.
In aggravation, the panel was informed of prior disciplinary proceedings, which included a hearing panel recommendation of indefinite suspension from the hearing in the Slawson matter; respondent’s pattern of misconduct in previous cases involving lack of competence, lack of diligence, lack of communication, and failure to cooperate; and the increasing seriousness of the conduct as evidenced by the instant case involving mishandling of funds and misrepresentations to a hearing panel.
Again, the panel recommended indefinite suspension, noting that normally disbarment would be the appropriate discipline.
Respondent recognizes that “there are a number of things h’e should have done differently.” However, he contends that he was suffering from depression, which affected his conduct. He states that he is now ready, willing, and able to maintain a law practice. He urges this court to consider public censure and to impose certain restrictions on his practice of law as suggested in respondent’s proposed rehabilitation plan.
We have carefully reviewed the record and the panel report. The panel was obviously concerned about respondent’s present and past conduct. The panel noted the similarity of respondent’s conduct in previous complaints and the pattern of a failure to communicate with his clients and with the disciplinary administrator’s office. Respondent’s action evidences a total disregard of his duty to his client, his profession, and the court. We concur with and adopt the panel’s findings, conclusions, and recommendations.
It Is Therefore Ordered that J. William Stapleton be and he is hereby indefinitely suspended from the practice of law in the State of Kansas, effective October 25, 1991.
It Is Further Ordered that respondent shall comply with the provisions of Supreme Court Rule 218 (1991 Kan. Ct. R. Annot. 163) and pay the costs of this proceeding, and that this order be published in the official Kansas Reports. | [
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The opinion of the court was delivered by
Allegrucci, J.:
This is a personal injury action arising out of a motor vehicle accident. The plaintiffs Norman Kuhl and Rilly D. Van Aken were employees of the defendant, Atchison, Topeka & Santa Fe Railway Company (ATSF). Defendant Willa Wright was employed at the Oak Tree Inn, a motel owned by defendant Green Country Inn, and she was driving Kuhl and Van Aken to work when the motel’s van was struck from behind by a car driven by defendant Juan Reyes and owned by defendant Curtis Canseco. The jury attributed 68% of the fault to ATSF, Wright, and Green Country Inn collectively, 22% to Reyes, and 10% to Canseco. The jury awarded the medical expenses incurred by each plaintiff, and the awards for pain, disability, and economic loss were identical. ATSF appealed the jury’s awards of identical damages to the plaintiffs. Green Country Inn and Wright appealed, asserting three issues: the jury instructions, the award of damages, and the district court’s failure to direct a verdict in their favor. The Court of Appeals, in an unpublished opinion filed August 23, 1991, found no error as. to the instructions, but reversed the jury’s award of damages and remanded the case for a new trial on that issue. Wright and Green Country Inn sought review of the Court of Appeals’ decision as to the jury instructions, and plaintiffs sought review as to the reversal of the jury’s award of damages. We granted both petitions for review.
Wright, who was employed at the Oak Tree Inn to drive railroad employees who stayed at the motel, drove Kuhl and Van Aken in a van from the Oak Tree Inn to the ATSF yards. When she stopped to make a left turn into the yards, a car driven by Reyes struck the rear of the van.
Those witnesses who were asked how long the van was stopped waiting to turn left gave widely varying answers. Jennifer Fountain, a teenaged pedestrian who witnessed the accident, estimated that the van was stopped for three seconds before it was struck. Wright said she did not know how long she was stopped before the accident occurred and could not estimate the time. She did remember, however, that several oncoming cars passed her before the van was hit. At trial Van Aken testified that he did not know exactly how long the van was stopped, but that the stop and the screeching of tires and the impact all occurred in a matter of seconds. In his deposition, Van Aken said that the van was stopped for 15 seconds or less. He remembered that there were several oncoming cars. Kuhl gave a statement to an insurance adjuster in which he said that the van was stopped between 30 and 45 seconds, and in his deposition he said approximately 30 seconds. At trial he testified that he had never been able to do more than roughly estimate how long they were stopped because he was not paying attention and “how seconds tick off I have no idea.”
The evidence is sharply conflicting on the question of how quickly Wright stopped the van. Jennifer Fountain used the phrase, “slammed on her brakes.” Wright testified that she stopped the van in a normal fashion. Reyes several times said that' Wright “slammed on her brakes,” but added that the van did not slide. He also' testified, however, that she did not slam on her brakes. He testified that her stop was “sudden,” but not so sudden as to cause the front end of the van to dip. Mark Walker, a passenger in the car driven by Reyes, described the stopping of the van as “real abrupt” and “real sudden.”
With regard to whether Wright signaled her intention to turn left, Wright is the only person who testified that she signaled before the van was hit. She said that the blinker was oh before she came to a stop. Jennifer Fountain said that the turn signal was not on before the accident. She also testified that, after the accident and after Wright surveyed the back of the van for damage, Wright went back into the van in order to activate the signal. Then Fountain heard Wright say she had it on. Reyes testified that Wright did not signal. Walker testified that Wright did not signal. Kuhl and Van Aken testified that immediately after the impact, Wright repeated over and over that she had turned on the turn signal.
It was daylight when the accident occurred. There is no indication that there were any adverse weather conditions in effect.
Juan Reyes was 15 years old at the time of the accident. He had neither a driver’s license nor a learner’s permit. Curtis Canseco was his friend, and Canseco had asked Reyes to take the car and run an errand for him. Reyes estimated that he was driving 25 m.p.h. The police report set his travel speed between 27 and 32 m.p.h. When Reyes first noticed the van, it was one car length away, and he saw the van’s brake lights come on. The van was stopped when he hit it.
After the accident Van Aken walked from the van into the rail yard and rode the train back to Iowa. He had a mild headache, his neck hurt, and there were some warm sensations in his neck. The next day he was “really sore.” He did not work for approximately two weeks. After that he had neck discomfort and severe headaches which caused him to miss some work. He slipped on some oil and fell in May 1988. Riding trains “really bothered” him, and he never got better. In December 1988 his doctor suggested a lighter form of work. Van Aken testified that he continues to be stiff and cannot turn his head quickly. He continues to remain physically active, but has tailored his exercises to his condition. He belongs to a health club where he rides an exercise bicycle with moving handle bars and lifts 50 to 60 pounds while lying on a bench; he jogs three miles twice a week and rides a mountain bike, but he no longer plays golf.
Van Aken was 38 at the time of trial. He had worked for ATSF for 16 years. His earnings as a brakeman with ATSF during the year 1987. were $27,911. He continued to work in his position until December 1988, approximately 10 months after the accident, when his doctor suggested that he find a lighter form of work. ATSF was reducing its work force and offering buyouts to brakemen at that time. Van Aken voluntarily left his job with ATSF and took a $37,000 buyout payment. Six months later he moved to Florida and began employment with a real estate agency selling residential property. During the last six months of 1989, he earned $480. In the first four months of 1990, before trial began in May 1990, he earned between $2,000 and $3,000, and he believed that his income would continue to increase as his clientele developed. Van Aken’s expert economist calculated his lost income at $424,000 to $483,000 — the lower figure being based on retirement at age 62 and the higher at 66.
Kuhl also walked away from the accident and rode the train back to Iowa as scheduled, but he began experiencing tightened back muscles and a headache before reaching his destination. He never was hospitalized for injuries suffered in this accident. Kuhl described his problem as “[m]ainly terrific headaches around the skull. Start here behind the skull down this big leader, that muscle right there, that was my main problem. Still today that is a very tender place.” He testified that the lateral movement of the train significantly aggravated the problem. He continued to make train trips during March 1988 using a muscle relaxant, aspirin, and a cervical collar. At the end of a trip he would lay on a hot pack until he was called for the next run. Kuhl has given up activities such as carpentry, electrical and cement work, and demolition and remodeling of houses, which he had engaged in before the accident. Driving bothers him, and he does not sleep through the night due to pain.
Kuhl was 63 at the timé of trial. He worked for ATSF from 1951 to 1960 and from 1966 to 1988...He had worked as a switch-man, brakeman, and conductor. Kuhl and his wife had 11 children, including 9 from prior marriages; the two youngest were 12 and 15 at the time of trial. Kuhl could have worked for the railroad until he was 70, and he intended to work until his youngest child was through school. The following salary figures were given for Kuhl: 1983 — $46,389; 1985 — $46,827; 1986 — $43,702; 1987 — $45,869. In 1988, the year of the accident, he earned $22,008. He retired October 1, 1988. Kuhl testified that he quit at the suggestion of Dr. Asher.
We first consider if the district court erred in instructing the jury. A recent statement of the standard for appellate review of alleged errors in jury instructions was given in Leiker v. Gafford, 245 Kan. 325, Syl. ¶ 1, 778 P.2d 823 (1989):
“Errors regarding jury instructions will not demand reversal unless they result in prejudice to the appealing party. Instructions in any particular action are to be considered together and read as a whole, and where they fairly instruct the jury on the law governing the case, error in an isolated instruction may be disregarded as harmless. If the instructions are substantially correct, and the jury could not reasonably be misled by them, the instructions will be approved on appeal.”
Willa Wright and Green Country Inn complain that the district court gave the following instructions to the jury: PIK Civ. 2d 8.03B, 8.26, and 8.25(a) and (b). PIK Civ. 2d 8.03B states as follows: “The driver of a vehicle has a duty to keep a lookout to the rear only if the movement of his vehicle may affect the operation of a vehicle to the rear.”
Wright and Green Country Inn rely on Jones v. Spencer, 220 Kan. 445, 553 P.2d 300 (1976), and Hallett v. Stone, 216 Kan. 568, 534 P.2d 232 (1975). They describe Hallett as “involv[ing] a rear end accident that occurred when the plaintiff was required to quickly stop to avoid striking a motor vehicle in front of her which made an abrupt left turn. The plaintiffs vehicle stopped and then was rear ended by defendant’s vehicle.” In holding that PIK Civ. 2d 8.03B had no support in the evidence and therefore was improperly given, this court said:
“The plaintiff did not execute the type of maneuver under which the duty arises. There is absolutely nothing in the evidence to indicate the plaintiff had any opportunity to look to the rear. Neither does the evidence suggest that the exercise of due care required such lookout. The plaintiff was forced to stop because of an illegal left turn by the driver in front of her. She could not turn aside to avoid the collision because of a high curb, and she had her vehicle under such control as to stop it within the range of her vision to avoid striking such vehicle.” Hallett, 216 Kan. at 572.
There are several significant ways in which Hallett differs from the present case. Wright was not forced to stop because of any unlawful maneuver being performed by a vehicle in front of her. The evidence is that she stopped for oncoming traffic before making a left turn into the rail yard. Several witnesses testified that Wright stopped suddenly and that she slammed on the brakes, although Wright testified that her stop was normal. There is no evidence that there was anything which would have kept Wright from moving forward to avoid the collision.
Hallett’s conduct with regard to keeping a lookout to the rear could not have been a proximate cause of her accident. In the circumstances of Hallett, therefore, the court’s giving of PIK Civ. 2d 8.03B was prejudicial to Hallett. There was evidence in the present case from which the jury could find that Wright’s conduct with regard to keeping a lookout to the rear was a proximate cause of the accident in this case.
In Jones, the plaintiff s vehicle had been stopped at a highway intersection for several minutes while he waited for oncoming traffic to clear so that he could make a left turn. Jones testified that his turn signal was on and his brake lights were on until immediately before the collision, when he moved his foot toward the accelerator. A pickup with a camper came up rapidly behind Jones, swerved into the ditch to the right of Jones’ vehicle, and turned over. Spencer, the driver of the car behind the pickup, did not see Jones until after the truck had swerved off the road. Spencer’s car struck the rear of Jones’ car, and the two remained locked together until they came to rest in a field 100 yards away. There were no skid marks on the highway.
This court said in Jones: “Our situation appears to be analogous to that in Hallett even though plaintiff here was contemplating a left turn. That movement was never made. The collision occurred while plaintiff was lawfully stopped preliminary to the left turn . . . .” 220 Kan. at 451. The rule as to when a duty to keep a lookout to the rear exists was recited in Hallett and in Jones:
“A motorist does not have the duty, under all circumstances, to keep a lookout to the rear, since he is entitled to rely on the exercise of ordinary care by those approaching from the rear. He may be required to maintain a lookout for a vehicle approaching from the rear when the presence of such vehicle is known, or if he is intending to change his course.” 220 Kan. 445, Syl. ¶ 2; 216 Kan. 568, Syl. ¶ 1.
On this point the Court of Appeals, in the present case, stated the following:
“We believe Hallett and Jones are both factually distinguishable from the case at hand. As a result, we hold they are not controlling.
“The facts of this accident are sharply conflicting. The evidence conflicts on how long Wright was stopped, whether she stopped abruptly, and whether she signaled her stop. There is evidence from which the jury could have concluded that Wright had only been stopped for three seconds prior to the collision and that she slammed on her brakes and made an abrupt stop.”
The rule stated in Hallett and Jones, that a driver may be required to maintain a lookout to the rear when he or she is intending to change course, could apply in the present case, depending on how the jury resolved the factual questions. In this respect it is distinguishable from Jones, which it most closely resembles. In Jones it was uncontroverted that plaintiff had been lawfully stopped for several minutes waiting for oncoming traffic to clear so that he could make a left turn. Jones could have gone straight rather than turning. Wright could have done the same thing. Neither Wright nor Jones was “limited to a single course of action as was the driver in Hallett.” The critical distinction is that Jones’ conduct was entirely lawful and his stop was made long before vehicles pulled up behind him, while Wright’s stop may have been sudden and made with other vehicles following her.
PIK Civ. 2d 8.25(a) and (b) relate to the duty of a driver to signal his or her intention to turn or stop. PIK Civ. 2d 8.26 describes means of signaling. Wright and Green Country Inn contend that the facts and language of Hallett and Jones establish that it was error to give these instructions in the present case. The Court of Appeals concluded that neither Hallett nor Jones applies. It further concluded that the duty to signal an intention to stop or turn is mandated by statute. Therefore, the reasoning continues, if neglect of the duty “was a factor in the accident, then the giving of such instructions is proper.” We agree.
The statutes referred to by the Court of Appeals are K.S.A. 8-1548, 8-1549, and 8-1550. The duties imposed by these statutes for signaling the intention to turn or stop in an “appropriate” way and “when there is opportunity to give such signal” were described to the jury following this prefatory instruction:
“As standards of ordinary care certain duties are imposed by law. They apply to persons who use the streets and highways. It is for you to decide from the evidence whether or not any of the following duties apply in this case and whether or not any have been violated. The violation of a duty is negligence.” PIK Civ. 2d 8.01.
Among the duties set out in subsequent instructions are keeping one’s vehicle under control, keeping a proper lookout, driving at a reasonable speed, following another vehicle at a reasonable distance, and giving an appropriate signal.
Neither Hallett nor Jones stands for the proposition that instructions as to the giving of an appropriate signal should not be given in the present case. In fact, it can be inferred that the jury was instructed as to the duty to signal in Jones. Examining the sufficiency of the evidence, this codrt stated: “The jury exonerated [the plaintiff] from a charge of failure to give an adequate signal and he must be deemed to have given that prescribed by statute.” 220 Kan. at 450. In Hallett it was said that PIK Civ. 2d 8.26 should not have been given because Hallett’s failure to signal could not have been a proximate cause of the collision. 216 Kan. at 576. The court’s determination that a signal would not have prevented Stone from running into the rear of Hallett’s car is based on Stone’s admission that she was paying no attention to the car in front of her and that the last time she noticed Hallett’s car it was a half block ahead of her and moving about 30 m.p.h.
Wright and Green Country Inn argue that the accident in the present case “would have occurred regardless of whether or not defendant Wright gave a signal of her intention to stop or turn. ” They contend that Reyes had the same notice that a signal would have provided because he observed the van suddenly decrease its speed, he saw the van’s brake lights, and the van was stopped when he hit it. They offer no explanation why a turn signal given before Wright reached the intersection would not have provided Reyes with notice in advance of her stop and in addition to it. Nor do they take into consideration reaction time for Reyes or that there were varying versions of the sequence and timing of the events. In the circumstances of this case, there was a factual question whether the accident would have occurred if Wright had signaled her intention to turn or stop.
Wright and Green Country Inn next complain that the district court failed to submit their requested instruction PIK Civ. 2d 8.28 to the jury. PIK Civ. 2d 8.28 states the following:
“The laws of Kansas provide that the driver of a vehicle intending to turn to the left within an intersection or into an alley, private road or driveway shall yield the right-of-way to any vehicle approaching from the opposite direction which is within the intersection or so close thereto as to constitute an immediate hazard.”
No authorities are cited for defendants’ position. They say only that where the jury was informed of other driving duties, it was prejudicial and confusing to the jury not to explain that Wright had a right and a legal responsibility to yield to oncoming traffic.
The Court of Appeals decided that the failure to give PIK Civ. 2d 8.28 was not a ground for reversal because “the question of why Wright brought her vehicle to a stop was never an issue in the case. We cannot imagine that the jury could have reached a conclusion that Wright was somehow required by law to turn her vehicle in front of oncoming traffic.” We agree. Wright’s failure to yield the right-of-way to oncoming traffic is not an issue. The issue with regard to her conduct was how she made the stop and not that she made it. There is no error in the district court’s refusing to submit PIK Civ. 2d 8.28 to the jury.
Wright and Green Country Inn next contend that the district court should have granted their motion for directed verdict “regarding the specific allegations of fault concerning lookout to the rear, left turn and stop.” They argue that Kansas law does not impose a duty on a motorist in Wright’s circumstances to keep a lookout to the rear. We rejected this argument in our previous discussion of PIK Civ. 2d 8.03B.
Wright and Green Country Inn also argue, relying primarily on Curtiss v. Fahle, 157 Kan. 226, 139 P.2d 827 (1943), that the failure to signal the intention to turn is not the proximate cause of a rear-end collision when the following driver observed the decrease in speed. The signal at issue in Curtiss was a signal of intention to stop or significantly decrease speed. Curtiss was a passenger in a car which hit the rear of a truck owned by Fahle. Curtiss’ petition charged that Fahle’s driver was negligent in suddenly decreasing the speed of his vehicle “without first giving notice of his intention to do so.” 157 Kan. at 233. The court disagreed:
“[Curtiss] and the driver of the car in which [Curtiss] was riding both concede they, observed not only the truck but also its sudden decrease in speed without any signal of decrease in speed having been given. This they observed when 150 feet behind the truck. They therefore had the same notice as an arm or mechanical signal would have imported if given at that time.” 157 Kan. at 237.
Unlike Curtiss, there are no admissions in the present case by the following driver or his passenger that they actually observed the van’s sudden decrease in speed 150 feet to the rear. When appellate review is sought on a motion for directed verdict, “the court is required to resolve all facts and inferences reasonably to be drawn from the evidence in favor of the party against whom the ruling is sought and where reasonable minds could reach different conclusions based on the evidence,” the trial court’s denial of the motion must be affirmed. See Holley v. Allen Drilling Co., 241 Kan. 707, Syl. ¶ 1, 740 P.2d 1077 (1987). Resolving all facts and inferences against Wright and Green Country Inn requires this court to conclude, based on the evidence, that Wright failed to signal her intention to turn, she failed to signal her intention to stop, she slammed on her brakes, and Reyes was unable to react in time to avoid hitting the rear of the van. We find no abuse of discretion in the district court’s denying the motion for directed verdict.
We next consider if the jury’s award of identical damages for pain, disability, and economic loss to the two plaintiffs requires reversal of the award and remand for a new trial on the issue of damages. In Morris v. Francisco, 238 Kan. 71, 77-79, 708 P.2d 498 (1985), this court discussed the differing standards of review for damage awards. There it was stated:
“In reviewing awards for pain, suffering and other subjective elements of damage, the following standard as iterated in Ratterree v. Bartlett, 238 Kan. 11, 707 P.2d 1063 (1985) applies:
‘Pain and suffering have no known dimensions, mathematical or financial. There is no exact relationship between money and physical Or mental injury or suffering, and the various factors involved are not capable of proof in dollars and cents. For this very practical reason the only standard for evaluation is such amount as reasonable persons estimate to be fair compensation for the injuries suffered, and the law has entrusted the administration of this criterion to the impartial conscience and judgment of jurors, Who may be expected to act reasonably, intelligently and in harmony with the evidence.
“Such awards are overturned only if the collective conscience of the appellate court is shocked. Merando v. A.T. & S.F. Rly. Co., 232 Kan. 404, 656 P.2d 154 (1982).
“Awards for objective elements of damage, such as loss of past and future income, are subject to a different standard of appellate review as they are grounded in mathematical calculation.
“In reviewing an award for an objective element of damages such as loss of past and future income, an appellate court must look to the record to see if there is evidence to support the jury’s calculation of pecuniary loss.”
In Kansas State Bank & Tr. Co. v. Specialized Transportation Services, Inc., 249 Kan. 348, 381, 819 P.2d 587 (1991), we said:
“Ordinarily, the assessment of damages in a personal injury action is exclusively the province of the jury. Germann v. Blatchford, 246 Kan. 532, 537, 792 P.2d 1059 (1990).
“When a verdict is attacked on the ground that it is contrary to the evidence, this court does not reweigh the evidence. If the evidence with all reasonable inferences to be drawn therefrom, when considered in the light most favorable to the successful party below, will support the verdict, we should affirm. Tice v. Ebeling, 238 Kan. 704, 708, 715 P.2d 397 (1986).”
In addition to their medical expenses, Kuhl and Van Aken each was awarded the following:
Pain and suffering $42,500.00
Disability $42,500.00
Other economic losses $221,000.00
The Court of Appeals noted substantial differences in the individual profiles of the two plaintiffs. It concluded that the identical damage awards are not compatible with the differences. The problem was identified as the jury’s failure to follow instructions:
“We hold that the identical verdicts for economic and non-economic losses in this case indicate that the jury failed in its requirement to evaluate each plaintiff s damages independently, based on their ages, the nature and extent of their injuries, and their conditions of health before and after the accident. The jury was instructed to evaluate the damages in this manner, and our conclusion from the verdict is that it failed to do so.”
Stating that it found it impossible to reconcile the identical awards with the evidence, the Court of Appeals held that the “identical verdicts for economic and non-economic losses” demonstrated that the jury failed to follow the instruction to evaluate each plaintiff*s damages independently. The Court of Appeals did not analyze the subjective elements separately from the objective elements of damages.
We first consider the award for non-economic damages. The verdict form and PIK Civ. 2d 9.01, Elements of Personal Injury Damage, make clear that the element of disability is categorized along with pain and suffering as non-economic/subjective. Thus, the jury’s awards for disability and pain and suffering may be overturned only if the collective conscience of the appellate court is shocked. Morris v. Francisco, 238 Kan. at 78. Moreover, this court must review the evidence in the light most favorable to Kuhl and Van Aken, who prevailed at trial. Ratterree v. Bartlett, 238 Kan. 11, 22, 707 P.2d 1063 (1985) (quoting Wooderson v. Ortho Pharmaceutical Corp., 235 Kan. 387, Syl. ¶ 1, 681 P.2d 1038, cert. denied 469 U.S. 965 [1984]).
The “only standard for evaluation is such amount as reasonable persons estimate to be fair compensation for the injuries suffered.” (Emphasis added.) Morris v. Francisco, 238 Kan. at 77-78 (quoting Ratterree v. Bartlett, 238 Kan. at 23). There is no per se rule which discredits identical awards, and there is no provision in current law for comparison of one plaintiffs recovery with another’s to serve as the basis for overturning a jury’s verdict. Thus, under current law, if the question whether reasonable persons could estimate $85,000 to be fair compensation for the injuries suffered by Kuhl as well as for the injuries suffered by Van Aken can be answered “yes,” the non-economic damages awards should be upheld.
Plaintiffs presented the following evidence as to their injuries:
Van Aken was injured when he was thrown forward by the force of the impact of Canseco’s car striking the rear of the van in which he was riding. He was able to walk away from the collision and ride the train to Fort Madison, Iowa. The headache and neck discomfort which were apparent immediately after the accident worsened with the train ride. In the months following the accident (in March 1988), he missed work due to neck discomfort and severe headaches. After about nine months, his doctor suggested that he find a lighter form of work. Dr. Bernard Abrams, a neurologist, testified that Van Aken, who had visited him in October or November 1988, had “scapulocostal syndrome” marked by “irritation, inflammation, chronic weakness and discomfort about the shoulder blades” and involving “limitation to the neck.” During a return visit in December 1988, there was improvement in Van Aken’s headache. He had “tenderness throughout the neck,” though, despite his taking medicines to reduce pain and inflammation. Van Aken told Dr. Abrams that his pain, which had been rated as 10 on a scale of 1 to 10 on the first visit, had been reduced to a 6V2. When Van Aken saw Dr. Abrams in May 1990, he continued to have pain and limited range of motion in his neck. Dr. Abrams described Van Aken’s condition as “chronic neck and shoulder pain.”
Kuhl was injured when he was thrown forward by the force of the impact of Canseco’s car striking the rear of the van in which he was riding. He was able to walk away from the collision and ride the train to Fort Madison, Iowa. The headache and neck discomfort which were apparent immediately after the accident worsened with the train ride. He described severe headaches and muscle pain in his neck. He worked off and on during the two months following the accident, and then he officially retired in October 1988. Dr. Abrams diagnosed Kuhl as having chronic neck strain and scapulocostal syndrome. Dr. Abrams described the condition as permanent. When Kuhl first visited Dr. Abrams in October 1988, he described pain in his left shoulder blade, diminished motion of the neck, and pain in the left neck region, which radiated to the left eye. Dr. Abrams found tenderness in Kuhl’s neck and back muscles. Kuhl took medicines for pain and inflammation. At two later visits, August 1989 and March 1990, Kuhl’s condition remained essentially the same.
We conclude that the record supports this element of the damages and reasonable persons could estimate $85,000 to be fair compensation for the injuries suffered by Van Aken. The same can be said for Kuhl. Moreover, these amounts do not shock the collective conscience of this court.
We next turn to the economic damages. According to Morris v. Francisco, in reviewing the awards for economic losses, this court must examine the evidence to see whether there is support for the jury’s computation. 238 Kan. at 79. Evidence with regard to the plaintiffs’ economic damages is as follows:
Van Aken was 38 at the time of trial. His railroad earnings in 1987 were $27,911. He was paid $37,000 when he left the railroad. For the first six months while he was selling residential real estate he earned $480. In the first four months of the next year he earned between $2,000 and $3,000. He anticipated that his income would continue to increase as he became established in his new profession. An economist testified that Van Aken’s lost income would be between $424,000 and $483,000, depending whether he retired at age 62 or later.
Kuhl was 63 at the time of trial. His railroad earnings in 1987 were $45,869. He retired in October 1988, although his youngest child was only 10 and he had intended to work for the railroad until the youngest child was through school. Railroad policy would have allowed him to work until the age of 70.
The Court of Appeals stated with regard to this evidence:
“We find that we cannot ignore the fact that these two plaintiffs were individuals of different ages, different wage history, different employment futures, and different physical and mental health conditions.”
The plaintiffs are different from one another in all the ways mentioned by the Court of Appeals. It is possible, however, to find support in the evidence for at least the amount awarded by the jury to each plaintiff. The plaintiffs do not complain that the awards are inadequate. If Kuhl had continued to work for the railroad for eight more years at his 1987 earnings level, his additional earnings would have been $366,952. Van Aken’s economist calculated that Van Aken’s lost earnings would have been between $424,000 and $483,000. If his $37,000 buyout payment is subtracted from $424,000, his lost railroad earnings would have been $387,000. Moreover, one can see from these figures that there is support in the evidence for similar loss figures for the two plaintiffs.
The Court of Appeals noted: “In addition to [the profile] differences, we note that Van Aken presented expert testimony concerning his loss of future income while Kuhl did not.” The lack of expert testimony for Kuhl seemed significant to the Court of Appeals. There is no requirement that lost income be established by expert evidence. Where, as in Kuhl’s case, a figure is ascertainable by a simple computation, there would seem to be no reason for counsel to hire an economist. Van Aken’s case presented a somewhat more involved calculation, which counsel may have believed warranted expert explanation. This difference in the way the two plaintiffs’ cases were presented should not account for any difference in the loss figure assigned to each plaintiff.
Wright, Green Country Inn, and ATSF contend that the awards were influenced by passion and prejudice and that the jurors failed to consider the claims of the plaintiffs separately and independently, as they were instructed to do. Their claim of error is not strictly that the awards are excessive in light of the evidence. Their claim is that the precise identity of the awards for the two plaintiffs manifests the improper deliberations by which the jurors arrived at the award figures. The Court of Appeals, too, discussed the awards as products of the jury’s failure to heed instructions.
In City of Ottawa v. Heathman, 236 Kan. 417, 690 P.2d 1375 (1984), this court affirmed the trial court’s granting of a motion for new trial on the ground that the jurors disregarded the instruction on calculating damages, added the amounts that each thought was appropriate and divided by six, and ultimately used the figure suggested by the foreman.
Of interest in Heathman, beyond the phenomenon of quotient verdicts, is this court’s review of Kansas cases which “have held that a new trial may be ordered when it is evident the jury has not followed court’s instructions.” 236 Kan. at 421. Examples given of cases involving erroneous damages awards were Dicker v. Smith, 215 Kan. 212, 523 P.2d 371 (1974) (punitive damages awarded where no actual damages had been awarded), and Timmerman v. Schroeder, 203 Kan. 397, 454 P.2d 522 (1969). Timmerman was a personal injury case arising from an automobile collision. Plaintiff was awarded the amount of her medical expenses but nothing for pain and suffering which had been shown by uncontradicted evidence. The inadequate damages looked suspiciously like a compromise involving liability and damages issues. “Such a compromise infects the entire verdict of the jury and renders it totally invalid.” 203 Kan. at 401.
This court, in Heathman, noted:
“In all of these cases it was evident from the verdict reached that the jury had acted in contravention of the court’s instructions and of the evidence. Disregard of the instructions was sufficient cause for the courts to grant a new trial. In the present case, it is not evident from the jury’s verdict that the jury failed to follow the court’s instruction. In fact, the trial court specifically found that the verdict was not contrary to the evidence, but was within the range of damages contained in the evidence. The court learned of the jury’s failure to follow instructions only after the filing of the juror’s affidavit and upon questioning the jurors at the hearing on the motion for a new trial. Whether this evidence could be used in determining whether to grant a new trial is a separate issue.” 236 Kan. at 424.
Recognizing that jury misconduct in intentionally disregarding the court’s instructions will invalidate a verdict, this court said:
“Misconduct by the jury, when it occurs, may be uncovered and the truth and veracity of those testifying to such misconduct can be tested. The matters set forth in the affidavits, if proven, must establish a conscious conspiracy by the members of the jury to disregard and circumvent the instructions on the law given by the court. If they do so, the jurors would have violated their oaths as jurors.” 236 Kan. at 425.
Although finding in Heathman that the affidavits were sufficient to show the jury had deliberately disregarded the instructions, this court emphasized that a new trial will not be granted on mere allegations. “There must be evidence, as here, that the jury consciously conspired to undermine the jury process by ignoring the instructions. Otherwise, it must be presumed that the jury has properly determined the before and after values before arriving at damages.” 236 Kan. at 426.
The defendants in the present case contend that the awarding of identical economic and non-economic damages to the plaintiffs was error as a matter of law. The defendants argue that the awarding of identical damages indicates that the jury did not follow the instructions in determining the damages or that the verdict was a result of passion or prejudice. The defendants cite no authority for such a proposition, nor are we aware of any. We find no merit in the defendants’ argument. There is no rational basis to conclude that the jury disregarded the instructions simply because it awarded the plaintiffs identical damages. Absent evidence to the contrary, it will be presumed that the jury followed the court’s instructions in awarding damages. We find no evidence in the record to indicate that the jury disregarded the instructions in awarding damages.
Where the alleged failure of the jury to follow instructions is not evident from the verdict or shown by definite proof, but is based solely on the fact that damages awarded to the plaintiffs are identical, the awards will be upheld if supported by the evidence and if they do not shock the conscience of the court. Based upon the record before this court and our standard of review, we find no error in the jury’s award of damages.
The judgment of the Court of Appeals is affirmed in part and reversed in part. The judgment of the district court is affirmed.
Abbott, J., not participating.
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The opinion of the court was delivered by
Holmes, C.J.:
William H. Mason appeals from his convictions of one count each of aggravated kidnapping (K.S.A. 21-3421), attempted aggravated sodomy (K.S.A. 1991 Supp. 21-3301; K.S.A. 21-3506), attempted rape (K.S.A. 1991 Supp. 21-3301; K.S.A. 21-3502), and aggravated sexual battery (K.S.A. 21-3518). Following enhancement of his sentence, the defendant is serving a controlling term of 26 years to 100 years plus two consecutive life sentences. We affirm on all counts.
Due to the issues raised on appeal, the facts will be set forth in some detail.
The victim, N.P., an 89-year-old widow, lived alone in rural Miami County. Around noon on June 7, 1990, a man came to her house, told her he had a flat tire, and asked to use her telephone. She asked if he was the same man who had been there the week before, and he replied, “Yes.”
The man used the telephone and the bathroom, and then asked for a drink of water. When N.P. went to the kitchen sink to get the water, the man grabbed her, dragged her into the bedroom, and put her on the floor.
N.P. was wearing a dress and underwear, and the man forcibly removed her underwear and held her to the floor by her ribs and back. He tried to unzip her dress but she resisted and told him he was not going to take it off. The assailant held her down, straddled her on the floor, exposed his penis, and attempted to force N.P. to perform oral sodomy upon him. She continued to resist and refused to comply with his demands.
At one point while the man had N.P. on the floor, he reached for and got one of her dress stockings out of her shoes, which were nearby, and doubled it up in his hand. Before he had an opportunity to use the stocking, for whatever purpose, the man suddenly released his victim, got up, and ran through the kitchen and out of the house. The evidence showed that there was a clear view of the driveway and approach to the house through the window in N.P.’s bedroom.
Within moments after the man left, N.P.’s son, Damon, came into the house and discovered his mother crawling toward the telephone. Damon, who lived about two miles from his mother, made a habit of coming to her house around noon so he could pick up her mail at the roadside mailbox and bring it in to N.P. The entrance to the house was on the opposite side from the approaching drive, and Damon did not see anyone leave the house as he came up the driveway. There was testimony at trial that while the road, mailbox, and driveway were all visible from the bedroom they would be difficult to see from the kitchen.
Damon immediately called the sheriff s office and reported the assault. N.P. described her assailant as medium built, with black hair and mustache, wearing a light-colored shirt trimmed with “some type of stripe,” blue jeans, and “old ragged” shoes, not made of leather but of “felt or something else.”
Sheriff Dan Morgan received a call at 1:06 p.m. from the dispatcher advising him of the sexual assault and he proceeded toward the home of N.P. While doing so, he stopped a man jogging barefoot along the gravel road about two miles from the victim’s home. The man wore blue jeans, but no shirt, shoes, or socks. He matched the physical description given by N.P. The man was identified as Bill H. Mason and was transported to the victim’s house where she was unable to positively identify him as her attacker.
Other deputies who arrived at the point where the sheriff had stopped Mason found a light-colored shirt with a blue stripe in the road and also found two shoes a short distance away. When those articles of clothing were shown to N.P., she immediately identified the shoes as the ones worn by her attacker. Later that afternoon the shirt and shoes were definitely identified by Mason’s wife as belonging to him. Mason had been to see his parole officer early that same morning, and employees in the parole office identified the shirt, shoes, and jeans as being the ones worn by Mason that morning.
Mason’s car was found in a field across the road from N.P.’s home. Mason was charged and convicted at trial as set forth earlier. At trial the defendant testified he became depressed after leaving the parole office, started drinking, got his car stuck on some rocks in a field, and did not remember anything about being at N.P.’s house. He admitted the shoes found near the scene were his but denied any knowledge of the shirt. Additional facts will be set forth as may be necessary in discussing the various issues raised on appeal.
Defendant’s first argument is that there was not sufficient evidence of bodily harm to sustain the conviction of aggravated kidnapping.
K.S.A. 21-3421 provides:
“Aggravated kidnapping is kidnapping, as defined in section 21-3420, when bodily harm, is inflicted upon the person kidnapped.” (Emphasis added.)
K.S.A. 21-3420 provides:
“Kidnapping is the taking or confining of any person, accomplished by force, threat or deception, with the intent to hold such person:
(a) For ransom, or as a shield or hostage; or
(b) To facilitate flight or the commission of any crime; or
(c) To inflict bodily injury or to terrorize the victim or another; or
(d) To interfere with the performance of any governmental or political function.
Kidnapping is a class B felony.”
The statutes do not define “bodily harm” and the trial court gave the following instruction based upon PIK Crim. 2d 56.25:
“INSTRUCTION No. 12
“The defendant is charged with the crime of aggravated kidnapping. The defendant pleads not guilty.
“To establish this charge, each of the following claims must be proved:
1. That the defendant took [N.P.] by force;
2. That it was done with intent to hold such person to facilitate the commission of a crime;
3. That bodily harm was inflicted upon [N.P.]; and
4. That this act occurred on or about the 7th day of June, 1990, in Miami County, Kansas.
“Bodily harm means any touching of the victim against the victim’s will, with physical force, in an intentional, hostile and aggravated manner, or the projecting of such force against the victim by the kidnapper.”
The defendant’s arguments in support of his first issue are twofold. First, he asserts that the definition of bodily harm in Instruction No. 12 is an incorrect statement of the law and, second, he claims that the evidence adduced at trial was insufficient to prove bodily harm.
At the outset, it should be noted that defendant did not object to the instruction, or the accompanying definition of bodily harm, at the trial. A party may not assign as error the giving or failure to give an instruction unless the party objects to the instruction, stating the specific grounds for the objection. Absent such ob jection, an appellate court may reverse only if the instructions given are clearly erroneous. K.S.A. 22-3414(3); State v. Owens, 248 Kan. 273, Syl. ¶ 7, 807 P.2d 101 (1991).
Defendant argues that the trial court in Instruction No. 12 used an obsolete, overbroad definition of “bodily harm.” He claims that although Kansas courts recognized the definition in the past, the definition of bodily harm has been significantly narrowed to exclude trivial injuries likely to result from any forcible kidnapping. He maintains that the definition of bodily harm used in this case derived from Kansas’ adoption of the definition employed in People v. Tanner, 3 Cal. 2d 279, 44 P.2d 324 (1935), and that California has since expressly rejected that definition. It is argued that in California today, bodily harm means “substantial bodily injury or damage to the body of a person who is the victim of such kidnapping by the application of physical force above and in addition to the force which is necessarily involved" in the commission of such kidnapping.” (Emphasis added.) People v. Schoenfield, 111 Cal. App. 3d 671, 685 n.14, 168 Cal. Rptr. 762 (1980). Defendant then reasons that Kansas is now required to use a definition that requires substantial bodily harm. We know of no rule of law which requires a state that has relied upon a decision of a sister state to thereafter follow all subsequent decisions of the other state on that particular issue. The definition of bodily harm in Instruction No. 12 was taken verbatim from our decision in State v. Royal, 234 Kan. 218, Syl. ¶ 6, 670 P.2d 1337 (1983).
In State v. Taylor, 217 Kan. 706, 714, 538 P.2d 1375 (1975), we recognized certain changes in the California law as set forth in Schoenfeld and stated:
“[The California court] now recognizes that some ‘trivial’ injuries are likely to result from any forcible kidnapping by the very nature of the act. It concludes that insignificánt bruises or impressions resulting from the act itself are not what the legislature had in mind when it made ‘bodily harm’ the factor which subjects one kidnapper to a more severe penalty than another. A significant policy reason for making the distinction is to deter a kidnapper from inflicting harm upon his victim, and to encourage the victim’s release unharmed. It was, in that court’s view, only unnecessary acts of violence upon the victim, and those occurring after the initial abduction which the legislature was attempting to deter. Therefore, only injuries resulting from such acts would constitute ‘bodily harm.’ [Citations omitted.]
“This refinement of the meaning of ‘bodily harm’ fits within the limits of our own prior cases.”
While we have recognized that the injuries may not be trivial and such as are likely to result from any forcible kidnapping, neither must they be substantial as argued by the defendant. We also recognized in Taylor that the definition of bodily harm given in this case was still viable in Kansas. The instruction as given is not clearly erroneous and thus defendant’s first argument in support of this issue lacks merit.
The second argument is that the evidence of injury is insufficient to establish bodily injury as contemplated by the statute and our cases. The evidence disclosed that N.P. was dragged to the bedroom, placed on the floor, and restrained by holding her to the floor by her back and ribs. She sustained bruises to the upper body and both arms. Dr. Robert Banks testified that he examined N.P. on June 7, 1991, at approximately 7:30 p.m., and that he found a number of bruises and scratches on her arms and forearms, a scratch on her ankle, and an abrasion on the lower mid-abdomen. Her ribs were tender. The doctor testified that the bruises on the arms and the scratches were consistent with injuries sustained by someone who had been grabbed by the arm and then had defended herself. We conclude that the evidence was clearly sufficient to prove that this 89-year-old woman suffered bodily injury as contemplated by the statutes and our prior cases.
The next issue raised by the defendant is that the charge of aggravated sexual battery was multiplicitous with the charges of aggravated kidnapping, attempted rape, and attempted aggravated sodomy.
“Multiplicity in criminal pleading is the charging of a single offense in several counts.” “A single offense may not be divided into separate parts; generally, a single wrongful act may not furnish the basis for more than one criminal prosecution.” State v. Garnes, 229 Kan. 368, Syl. ¶¶ 4, 5, 624 P.2d 448 (1981). In State v. Scott, 250 Kan. 350, 827 P.2d 733 (1992), we stated: “Charges are not multiplicitous if each charge requires proof of a fact not required in proving the other.” State v. Woods, 250 Kan. 109, Syl. ¶ 6, 825 P.2d 514 (1992); State v. Howard, 243 Kan. 699, 703, 763 P.2d 607 (1988).
Aggravated sexual battery is defined in K.S.A. 21-3518(l)(a) which states:
“(1) Aggravated sexual battery is:
(a)The unlawful, intentional application of force to the person of another who is not the spouse of the offender and who does not consent thereto, with the intent to arouse or satisfy the sexual desires of the offender or another. ”
Defendant was charged with four counts. The aggravated kidnapping charge alleged that he intentionally took the victim by force with intent to hold her to facilitate the commission of the crime of rape and/or sodomy and did inflict bodily harm on the victim. The attempted rape charge alleged that defendant attempted to commit the act of sexual intercourse with the victim without her consent while her resistance was overcome by force or fear. The attempted aggravated criminal sodomy charge alleged that he attempted to commit sodomy with the victim, who did not consent, when she was overcome by force or fear. The aggravated sexual battery charge alleged that defendant applied force to the victim, who was not his spouse and did not consent, with the intent to arouse or satisfy his sexual desires.
Defendant relies upon K.S.A. 21-3107(2) and three Kansas cases which apply that statute. K.S.A. 21-3107(2) provides:
“Upon prosecution for a crime, the defendant may be convicted of either the crime charged or an included crime, but not both. An included crime may be any of the following:
(a) a lesser degree of the same crime;
(b) an.attempt to commit the crime charged;
(c) an attempt to commit a lesser degree of the crime charged;
(d) a crime necessarily proved if the crime charged were proved.”
In State v. Lassley, 218 Kan. 758, 545 P.2d 383 (1976), this court set aside one count of aggravated assault when the court found that the act of violence relied upon for that charge was the same act of force used to establish the charges of kidnapping and rape. However, in doing so the court stated:
“In State v. Lora, 213 Kan. 184, 515 P.2d 1086, we stressed that duplicity [multiplicity] does not depend on whether the facts proved at trial are actually used to support the conviction of both offenses; rather, it turns on whether the necessary elements of proof of the one crime are included in the other.” 218 Kan. at 761.
Again, in State v. Turbeville, 235 Kan. 993, 995, 686 P.2d 138 (1984), the court found that a count of aggravated battery was multiplicitous to the charge of attempted murder when both charges were based upon one single act, the shooting of the victim. The court disposed of the .issue in a single paragraph and did not deem it necessary to go into detail due to the obvious fact that the defendant was both charged and convicted of the two offenses based upon one single act of violence.
Finally, the defendant cites State v. Cathey, 241 Kan. 715, 741 P.2d 738 (1987), where the facts revealed that the defendant was charged with attempted murder and aggravated battery based upon a beating and a shooting of the victim. The court found that the two acts were essentially simultaneous and part of one attack and, therefore, were multiplicitous.
All three cases relied upon by defendánt are distinguishable from the present case. Here, the elements of the charge of aggravated sexual battery as specified in K.S.A. 21-3518(l)(a) require proof of facts not required in proving the other charges. Defendant relies upon K.S.A. 21-3107(2)(d), which defines an included crime as “a crime necessarily proved if the crime charged were proved.”
This court has frequently struggled with the proper construction, interpretation, and application of K.S.A. 21-3107(2)(d) as demonstrated in several recent cases, including State v. Fike, 243 Kan. 365, 757 P.2d 724 (1988); State v. Adams, 242 Kan. 20, 744 P.2d 833 (1987); and State v. Arnold, 223 Kan. 715, 576 P.2d 651 (1978).
In the recent case of State v. Gibson, 246 Kan. 298, 787 P.2d 1176 (1990), the issue of the application of the statute was again before this court. The defendant contended that aggravated sexual battery was a lesser included offense of rape under the facts of the case. In Gibson we stated:
“Défendant recognizes that the statutory elements are different in that aggravated sexual battery requires proof of a nonspousal relationship and proof of an intentional application of force with the intent to arouse or satisfy the sexual desires of the offender or another, neither of which are required to prove rape. However, defendant contends that under our decision in State v. Fike, 243 Kan. 365, 757 P.2d 724 (1988), the instruction was required because the State did prove an intentional application of force with the intent to arouse upon proving the act of sexual intercourse and also proved a nonspousal relationship.
“In Fike, the court stated the test for lesser included crimes under K.S.A. 21-3107(2)(d) as follows:
‘In determining whether a lesser crime is a lesser included crime or offense under K.S.A. 1987 Supp. 2I-3I07(2)(d), a two-step analysis or two-pronged test has been adopted. The first step is to determiné whether all of the statutory elements of the alleged lesser included crime are among the statutory elements required to prove the crime charged. If so, the lesser crime is a lesser included crime of the crime charged. Under the second prong of the test, even if the statutory elements of the lesser crime are not all included in the statutory elements of the crime charged, the lesser crime may still be a lesser included crime under K.S.A. 1987 Supp. 2I-3107(2)(d) if the factual allegations of the charging document and the evidence required to he adduced at trial in order to prove the crime charged would also necessarily prove the lesser crime.’ 243 Kan. 365, Syl. ¶ 1. (Emphasis added.)
“Defendant’s reliance on Fike is misplaced. He has confused what the State may have actually proved in its evidence establishing that a rape occurred with what the State was required to prove to establish the crime charged. The mere fact that the evidence adduced in proving the crime charged may also prove some other crime does not make the other crime a lesser included offense under K.S.A. 21-3107(2)(d). Neither the factual allegations of the rape charge nor the evidence the State was required to adduce at trial includes an intent to arouse or a nonspousal relationship. Defendant fails to distinguish between what the State may prove and what the State must prove at trial.” 246 Kan. at 299-300.
On the other hand, the State relies upon K.S.A. 21-3107(1), which provides:
“When the same conduct of a defendant may establish the commission of more than one crime under the laws of this state, the defendant may be prosecuted for each of such crimes. Each of such crimes may be alleged as a separate count in a single complaint, information, or indictment.”
Here, the State charged and proved the elements of aggravated sexual battery which include that the victim “is not the spouse of the offender” and that the act was done “to arouse or satisfy the sexual desires of the offender or another.” Neither of these elements of proof are necessary to prove the crimes of aggravated kidnapping, attempted aggravated sodomy, or attempted rape. We conclude the charge of aggravated sexual battery is not a lesser included crime of aggravated kidnapping, attempted aggravated sodomy, or attempted rape, and is not multiplicitous to those charges under K.S.A. 21-3107(2). This issue lacks merit.
The next issue asserted by the defendant is that the evidence was insufficient for the jury to conclude beyond a reasonable doubt that the defendant was guilty of any of the crimes charged. The essence of defendant’s argument is that “there is no distinct evidence linking Mr. Mason to the crimes charged,” and that the circumstantial evidence presented falls short of proving guilt beyond a reasonable doubt.
When the sufficiency of the evidence is challenged, the standard of review is whether, after reviewing all of the evidence, viewed in the light most favorable to the prosecution, the appellate court is convinced that a rational factfinder could have found the defendant guilty beyond a reasonable doubt. State v. Graham, 247 Kan. 388, 398, 799 P.2d 1003 (1990). We have carefully reviewed the entire record and have set forth the facts in some detail earlier in this opinion. We conclude the evidence was clearly sufficient and that the argument of the defendant is wholly without merit.
The last issue asserted by the defendant on appeal is that the trial court erred in admitting evidence of a prior crime.
Prior to trial, the State moved to admit evidence pursuant to K.S.A. 60-455 that defendant had committed a similar crime, contending the other crime was relevant to the issue of identity.
K.S.A. 60-455 provides:
“Subject to K.S.A. 60-447 evidence that a person committed a crime or civil wrong on a specified occasion, is inadmissible to prove his or her disposition to commit crime or civil wrong as the basis for an inference that the person committed another crime or civil wrong on another specified occasion but subject to K.S.A. 60-445 and 60-448 such evidence is admissible when relevant to prove some other material fact including motive, opportunity, intent, preparation, plan, knowledge, identity or absence of mistake or accident.” (Emphasis added.)
Following a hearing on the State’s motion, the court found that evidence of the defendant’s prior conviction of second-degree murder in Leavenworth County committed in 1974 was admissible for the limited purpose of proving identity. The jury was given a limiting instruction to the effect that the evidence of the prior crime was admissible solely for the purpose of proving identity. Defendant claims error on grounds the evidence of the prior crime was not relevant, that the evidence linking him to the present crime was circumstantial and “very weak at best,” and that the risk of undue prejudice outweighed any probative value the evidence might have.
At trial, evidence of the 1974 murder was introduced through Lieutenant Charles Scharer, the detective who investigated the crime, and Dr. Earl J. Wright, the pathologist who performed the autopsy upon the victim in that case.
The State, in its brief, summarizes the evidence of the earlier crime as follows:
“Lieutenant Scharer was a detective with the City of Leavenworth Police Department and investigated the January 25, 1974, murder of the victim of which the appellant was convicted. Lieutenant Scharer identified the defendant in the courtroom as the person who was charged in that murder in Leavenworth County, Kansas.
“Lieutenant Scharer testified that the victim in that case was a 74-year-old female, that she was found with a wool sock wrapped tightly around her neck such that it caused a bulge on each side around her neck.
“Lieutenant Scharer interviewed the defendant in the course of his investigation of the murder. During the interview the defendant told Lieutenant Scharer that he lived across the street from the victim in Leavenworth, Kansas, and that he rented his home from the victim. The appellant told Lieutenant Scharer that he was married at the time. The defendant told Lieutenant Scharer that the victim let him into her home, they talked for a while, and they walked back to the telephone together which was located in the bedroom. Lieutenant Sharer was then told that the victim turned her back, the defendant pulled a sock out of his back pocket, and put it around her neck.
“The defendant told Lieutenant Scharer that the victim moved real fast, they tripped and fell on the bed, and he didn’t remember what happened next. He got up, saw her lying there. He picked up her wallet off the dresser and walked out the back door.
“On cross-examination by defendant’s attorney, Lieutenant Scharer testified that the defendant told him that on the night of the murder he had been drinking Seagram’s and Coke and had had 10 or 12 drinks.
“On redirect examination, Lieutenant Scharer testified that the defendant said he did not know that the victim was dead when he left and that he had had no sexual contact with her.
“Lieutenant Scharer testified that the defendant was convicted of the murder of this victim and certified copies of the Journal Entry of conviction were admitted into evidence.
“Dr. Earl J. Wright, the pathologist who performed the autopsy upon the body of the victim, testified that the victim was elderly, 76 years of age, that she had a stocking around her neck and had been strangled, which was the cause of death. The doctor’s examination of the vaginal area indicated abrasions, contusions and bloody fluid at the entrance to the vagina. There was also trauma to the cervix. The doctor further testified that his examination of the fluids from the vagina revealed the presence of acid phosphatase which is alien to the female but is present in the prostatic secretions from the male. His findings were consistent with rape.”
In ruling on the admissibility of prior crimes evidence pursuant to K.S.A. 60-455, the trial court must: (1) determine it is relevant to prove one of the eight factors specified in the statute; (2) determine the fact is a disputed, material fact; and (3) balance the probative value of the prior crime or civil wrong evidence against its tendency to prejudice the jury. State v. Nunn, 244 Kan. 207, 211, 768 P.2d 268 (1989); State v. Breazeale, 238 Kan. 714, 714 P.2d 1356, cert. denied 479 U.S. 846 (1986).
The identity of the defendant in the instant case was the central issue and was a hotly disputed and material fact. The relevance of the evidence surrounding the 1974 murder to the statutory issue of identity is obvious.
State v. Bly, 215 Kan. 168, 523 P.2d 397 (1974), is the leading case on the admissibility of prior crimes evidence under K.S.A. 60-455. The court set forth several basic principles to be considered in the admission of such evidence and stated:
“11. Where a similar offense is offered for the purpose of proving identity, the evidence should disclose sufficient facts and circumstances of the other offense to raise a reasonable inference that the defendant committed both of the offenses. In other words to show that the same person committed two offenses it is not sufficient simply to show that the offenses were violations of the same or a similar statute. There should be some evidence of the underlying facts showing the manner in which the other offense was committed so as to raise a reasonable inference that the same person committed both offenses.” 215 Kan. at 177.
We do not deem it necessary to review at length the evidence already set forth disclosing the similarities between the facts surrounding the 1974 case and the present one. Suffice it to say, the two cases are sufficiently similar to establish the relevancy and materiality of the prior crimes evidence to prove the identity of the. defendant in this case.
Finally, the defendant contends the prejudicial effect of the evidence far outweighs its probative value. In State v. Searles, 246 Kan. 567, 579, 793 P.2d 724 (1990), we stated:
“Before prior crimes evidence is admissible under K.S.A. 60-455, the trial court must also find that the probative value of the evidence — for the limited purpose for which it is offered — outweighs its prejudicial effect. . . . [T]he evidence should not be admitted if the potential for natural bias and prejudice overbalances the contribution to the rational development of the case.”
In the present case, the State correctly maintains that the prior crimes evidence was not cumulative, but was a significant piece of evidence to aid in proving identity. While we cannot say that the evidence was not prejudicial to the defendant’s case, we are satisfied that its probative value far outweighs any such prejudice. A ruling on the admissibility of prior crimes evidence lies within the sound discretion of the trial court and “will not be interfered with on review unless that discretion was abused, or unless the trial judge admitted evidence that clearly had no bearing on any of the issues.” 246 Kan. at 579. In the present case, that discretion was not abused.
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The opinion of the court was delivered by
Lockett, J.:
Natural gas producers, Barbara Oil Co. (Barbara) and Pickrell Drilling Co. (Pickrell), sued Kansas Gas Supply Corporation (KGS), a natural gas pipeline company, and three KGS affiliates (the Oxy companies) in separate actions later consolidated at the district court level. Barbara and Pickrell claimed KGS breached “take or pay” contracts by not buying the required minimum amounts of gas for several years commencing in 1983. KGS filed a third-party action against Kansas Gas and Electric Company (KG&E), claiming KG&E should indemnify KGS for any liability it had to Barbara and Pickrell. KGS’s indemnity action claimed its failure to purchase the required minimum amounts of gas resulted either from KG&E’s breach of its contract with KGS or fraud by silence, Le., KG&E intentionally failed to notify KGS of its reduced need for gas; alternatively, KGS’s action claimed that when KGS extended its gas contracts with the producers it acted as the agent of KG&E and, therefore, KG&E, as principal, was obligated to indemnify KGS for its liability to Barbara and Pickrell. Before trial, KGS and the Oxy companies settled with Barbara and Pickrell. KG&E moved for summary judgment on all of KGS’s claims. The trial court granted summary judgment on KGS’s indemnity for breach of contract claim on grounds the statute of limitations had run, but it denied summary judgment on the agency and fraud claims. At the close of KGS’s case and again at the close of all the evidence, KGS moved for a directed verdict on the agency and fraud by silence claims. The trial court denied KG&E’s motions, finding there was sufficient conflicting evidence to submit the questions of agency and fraud by silence to the jury. The jury found (1) KG&E had fraudulently concealed anticipated changes in its gas requirements but KGS’s fraud claim was barred by the statute of limitations and (2) when KGS extended its contracts with Barbara and Pickrell, KGS had acted as KG&E’s agent. The jury awarded KGS $5,250,000.
On appeal, KG&E claims the district court should have granted its motion for a directed verdict and summary judgment because: (1) There was no agency relationship; (2) the parol evidence rule bars consideration of KGS’s implied agency claim; (3) the 1984 Gas Sales Agreement extinguished any agency relationship that may have existed; and (4) KGS’s agency claim is barred by the applicable statute of limitations. KG&E did not appeal the jury finding of fraud. In the event its judgment is not affirmed, KGS cross-appeals, contending its indemnity claims for KG&E’s breach of contract and fraud are governed by the statute of limitations for indemnity claims rather than the statutes of limitations for breach of contract and fraud.
KG&E is a utility company that provides electricity to customers in most of south central and southeast Kansas. KGS is an intrastate natural gas pipeline company that buys natural gas under contracts with producers. In turn, KGS sells that gas to its customers. Historically, KG&E has been the largest customer of KGS and the purchase and sale of natural gas between the two have been governed by various contracts. KGS has gas pipelines originating in western Kansas that terminate at two KG&E gas-fired power plants in Wichita, the Murray Gill and Gordon Evans Electric Generating Stations. Until the early 1970’s, KG&E generated almost all its electricity by burning natural gas. In 1973, however, KG&E’s first coal plant, the La Cygne #1, was placed into service and, in 1985, Wolf Creek nuclear power plant became operational. KG&E continued to use natural gas after the La Cygne #1 and Wolf Creek plants began operating, but its actual gas needs and the amount of gas it purchased from KGS diminished substantially.
The pertinent contracts governing the purchase and sale of natural gas between KG&E and KGS included:
1960 — Glick Contract.
This contract specifically provided that KG&E was required to take gas from the Glick-Mississippi Gas Pool (Glick Field) as needed for its Gordon Evans and Murray Gill plants. KGS’s excess gas, not needed by KG&E, could be sold to others only when it became necessary for KGS to avoid minimum-take liability to the producers. The contract allowed KGS to extract from the gas stream and sell, without regard to KG&E’s gas needs, butane, propane, and other valuable liquid hydrocarbons for the benefit of KGS’s corporate affiliates.
1962 — Calista Contract.
KGS agreed to sell gas to KG&E from sources of supply other than the Glick Field on an interruptable basis. The terms of the Calista Contract are essentially the same as the 1960 Glick Contract.
1972 — Contract for Additional Gas (also referred to as the New Gas Contract).
Unlike the Glick and Calista contracts, this contract required KG&E to pay for gas which KGS made available under the contract, even if the gas was not needed or taken by KG&E, to the extent of KGS’s minimum-take liability, if any. This requirement is referred to as a “take or pay” provision and was eliminated in 1981 by order of the Kansas Corporation Commission.
1976 — Various contract amendments extended the 1960, 1962, and 1972 contracts through 1990.
KG&E and KGS agreed that KGS would attempt to extend its producer contracts and obtain additional gas reserves exclusively for the benefit of KG&E. The agreement extending the Glick Contract, which maintained the exclusive dedication of gas to KG&E, provided: “Vendor [KGS] will undertake for the benefit of Vendee [KG&E], in performance of this contract, to extend [the contracts with producers in the Glick Field] or enter into new contracts with such producers upon terms and conditions mutually agreeable between Vendor and such producers.” The extensions retained KG&E’s right of first refusal for all gas under contract to KGS. (These are the contracts on which KGS was later sued by the producers and for which KGS sought indemnification against KG&E on an agency theory.)
1981 — Contract amendments to the 1960, 1962, and 1972 contracts abrogated their pricing provisions due to an order of the Kansas Corporation Commission. The Contract for Additional Gas, which was the only contract which had a “take or pay” provision, was amended so that KG&E would be required to pay only for gas it actually utilized/took. From this point forward, all of the contracts between KG&E and KGS specifically provided that KG&E was required to pay only for gas which KG&E actually utilized/took.
1984 — Gas Sales Agreement.
This contract provided in pertinent part that: (1) it replaced the three prior contracts “in toto”; (2) it was the entire agreement between the parties; and (3) KG&E was required to pay only for gas actually taken from KGS (i.e., no payments were required for excess gas which KGS might have and which KG&E did not need to take).
In September 1976, KG&E requested KGS to submit its forecast of gas availability for the following 10 years. In turn, KGS asked KG&E for its 10-year forecast of gas requirements so KGS could formulate a gas acquisition program. KG&E provided KGS with a 10-year forecast showing gas requirements substantially in excess of KGS’s forecasted supply throughout the 10-year period. From 1976 to 1983, KG&E annually prepared 10-year forecasts of its gas needs. After 1982, KG&E did not provide KGS with additional forecasts nor advise KGS of an expected decrease in its future gas requirements. KGS, however, annually provided KG&E with its 10-year forecasts of gas availability, which showed KGS was acquiring large reserves of gas pursuant to the 1976 amendments.
In 1977 and 1978, KGS obtained extensions of its gas purchase contracts with Barbara and Pickrell and other Glick field producers to 1990, to coincide with the extended term of the Glick contract between KGS and KG&E.
In June 1980, KG&E was aware that the availability of gas had increased and its future gas requirements would decline to a point where its suppliers were forecasting they had acquired gas reserves significantly in excess of KG&E’s requirements for 1983-1988. KG&E officials were aware that:
(1) KGS was continuing to acquire gas aggressively;
(2) costs of acquisition were rising;
(3) KGS was expecting to sell essentially all the gas in its pipeline to KG&E;
(4) KG&E’s forecasts, showing available gas already significantly in excess of KG&E’s requirements for the years 1983-1988, had never been disclosed to KGS; and
(5) KG&E could stop KGS from continuing to purchase gas it would be unable to sell to KG&E.
I. Did the trial court err in submitting the agency question to the jury?
As to the issue of agency, the trial judge in instruction Nos. 3, 8, and 9, instructed the jury as follows:
“It is the law of this state that to prove agency it is necessary for the party claiming the existence of an agency agreement to prove it by evidence that is clear and satisfactory.
“To be clear and satisfactory, evidence should be ‘clear’ in the sense that it is certain, plain to the understanding, unambiguous, and ‘satisfactory’ in the sense that it is so believable that people of ordinary intelligence, discretion and caution may have confidence in it.”
“KGS claims that it acted as an agent for its principal, KG&E, when KGS entered into amendments extending the contracts with Barbara Oil Company and Pickrell Drilling Company (‘Barbara and Pickrell’) to purchase gas from Barbara and Pickrell, and that KG&E, as principal, must indemnify KGS for the amounts it paid in settlement of Barbara and Pickrell’s claims against KGS. To obtain reimbursement from KG&E, KGS must show:
1. KGS acted as an agent for KG&E when it entered into amendments extending the contracts with Barbara and Pickrell to purchase gas from Barbara and Pickrell; and
2. KGS made a reasonable settlement of the claims by Barbara and Pickrell.
“An agent is a person who, by agreement with another called the principal, performs or is to perform services for the principal with or without compensation. The agreement may be written, oral or implied by the behavior of the parties.
“Unless otherwise agreed, it is inferred that a principal contracts to use care to inform the agent of risks of pecuniary loss which, as the principal has reason to know, exist in the performance of authorized acts and which he has reason to know are unknown to the agent. His duty to give other information depends upon the agreement between them.
“A principal’s duty to indemnify its agent arises from the existence of an agency relationship and does not require a separate express agreement.
“KGS’s settlement with Barbara and Pickrell is reasonable if the amount paid is reasonable and KGS would have been liable to Barbara and Pickrell.”
“You may find that an agreement between KG&E and KGS included a term that made KGS KG&E’s agent with respect to activities giving rise to KGS’s liability to Barbara and Pickrell only if you find that KGS has proved by clear and satisfactory evidence that KGS and KG&E expressly or impliedly agreed that KGS would act primarily for KG&E’s benefit and not for itself with respect to those or related activities: that is, in order words, that they agreed that KGS would be KG&E’s fiduciary, and would put KG&E’s interests ahead of its own.”
As to KG&E’s defense relative to KGS’s agency indemnification claim, in instruction Nos. 10 and 11, the trial judge instructed:
“A defense that KG&E asserts against KGS’s claims of agency indemnification is the defense of waiver. If you find that KG&E has proved this defense, KGS will not be entitled to recover on this claim. In order for KG&E to prove this defense, it must prove that after KGS discovered its potential liability to Barbara or Pickrell, KG&E and KGS made a new contract in which KG&E made some substantial concession, or which was more favorable to KGS than the previous contract between the parties.”
“A second defense that KG&E asserts against KGS’s agency indemnification claim is the defense of accord and satisfaction, also referred to as substituted contract. If you find that KG&E has proved this defense, KGS will not be entitled to recover on these claims. In order for KG&E to prove this defense, it must prove that after KGS actually discovered its potential liability to Barbara and Pickrell, KG&E and KGS made a new contract by which the parties knowingly agreed that KGS’s indemnification claim would be relinquished.”
The jury verdict form submitted to the jury stated in relevant part:
“5, Has KGS proved by clear and satisfactory evidence that it acted as the agent of KG&E when it extended the Barbara and Pickrell gas purchase agreements (Instruction No. 8 & 9)? If you answer ‘yes’ to this question proceed to Question 6. If you answer ‘no’ you should not answer the remaining questions.
YES X NO _ Agreement is by 12 jurors.
(must be by 10 or more)
“6. Has KG&E proved by a preponderance of the evidence either of its claimed defenses of waiver (Instruction No. 10) or substituted contract (Instruction No. 11) to KGS’s agency claim? If you answer ‘yes’ to this question, you should not answer the remaining questions. If you answer ‘no,’ proceed to question 7.
YES _ NO X Agreement is by 1J2 jurors
(must be by 10 or more)”
Neither party objected to the giving of a substituted contract instruction or the jury verdict form. It is important to note that the jury was not asked if KGS was acting as KG&E’s agent by a written or oral agreement or implied by the behavior of the parties.
“Summary judgment is proper where the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Patterson v. Brouhard, 246 Kan. 700, 702-03, 792 P.2d 983 (1990).
“The burden on the party seeking summary judgment is a strict one. The trial court is required to resolve all facts and inferences which may reasonably be drawn from the evidence in favor of the party against whom the ruling is sought. On appeal we apply the same rule, and where we find reasonable minds could differ as to the conclusions drawn from the evidence, summary judgment must be denied.” Bacon v. Mercy Hosp. of Ft. Scott, 243 Kan. 303, 306, 756 P.2d 977 (1988).
“In ruling on a motion for a directed verdict, the court is required to resolve all facts and inferences reasonably to be drawn from the evidence in favor of the party against whom the ruling is sought and where reasonable minds could reach different conclusions based on the evidence the motion must be denied and the matter submitted to the jury. This rule is also applicable when appellate review is sought on a motion for directed verdict.” Holley v. Allen Drilling Co., 241 Kan. 707, 710, 740 P.2d 1077 (1987).
An agency has been defined as a contract, either express or implied, by which one of the parties confides to the other the management of some business to be transacted in the party’s name, or on the party’s account, and by which that other assumes to do the business and to render an account of it. Determination of what constitutes agency and whether there is any competent evidence reasonably tending to prove the existence of agency is a question of law. An express agency exists if the principal has delegated authority to the agent by words which expressly authorize the agent to do a delegable act. An implied agency may exist if it appears from the statements and conduct of the parties and other relevant circumstances that the intention was to clothe the agent with such an appearance of authority that when the agency was exercised it would normally and naturally lead others to rely on the person’s acts as being authorized by the principal. Professional Lens Plan, Inc. v. Polaris Leasing Corp., 238 Kan. 384, Syl. ¶¶ 4, 5, 6, 7, 710 P.2d 1297 (1985).
KG&E contends the question of whether an agency existed is a question of law and not a question of fact ánd only when there is conflicting evidence can the issue be submitted to a jury. KG&E asserts that, because the relationship between the two parties in this case is defined by a written contract, the contract determines the agency issue. It argues the willingness of courts to find the existence of an agency depends on whether the question is raised by one of the parties to a contract or by a third party. Where there is no third party, KG&E claims, it is inappropriate for the courts to find an agency relationship unless it is created by contract. KG&E asserts that, since the contracts determine the issue, there was no question of fact and the district judge should have granted its motions for summary judgment and directed verdict on the agency issue.
What constitutes agency and whether there is competent evidence reasonably tending to prove the relationship is a question of law. Although what constitutes agency is a question of law, resolution of conflicting evidence which might establish its existence is for the finder of fact. Aetna Casualty and Surety Co. v. Hepler State Bank, 6 Kan. App. 2d 543, 548, 630 P.2d 543 (1981). The weight to be given evidence and resolution of. conflicts therein are functions of the trier of facts in the determination of whether there is a relationship of principal and agent. Where the existence of agency is disputed, its existence or nonexistence is ordinarily a question of fact for the jury, to be determined upon proper instructions. CIT Financial Services, Inc. v. Gott, 5 Kan. App. 2d 224, 229-30, 615 P.2d 774, rev. denied 228 Kan. 806 (1980). “The province of an appellate court is to determine if the record reveals evidence on which a finding of agency could be based, not to decide whether, under proper instructions relating to the law of principal and agent, it existed as a matter of fact.” Traylor v. Wachter, 3 Kan. App. 2d 536, Syl. ¶ 2, 598 P.2d 1061 (1979), aff'd in part, rev'd in part 227 Kan. 221, 607 P.2d 1094 (1980).
KG&E contends the trial court erred in not granting KG&E summary judgment or directed verdict because there is no evidence of an agency agreement between KG&E and KGS. Specifically, KG&E argues (1) agency relationships are fiduciary relationships which must be proved by clear and convincing evidence, which was lacking in this case; (2) KGS and KG&E did not expressly contract for KGS to be KG&E’s agent; (3) there is no evidence that KG&E implied KGS was to be its agent; (4) the agency issue before this court presents a question of law; and (5) since the relationship between KGS and KG&E is defined by a written contract, that contract determines the agency issue in lawsuits between them.
KG&E observes the existence of an “agency” contract, express or implied, is not easily established, i.e., it must be proved by clear and convincing evidence. Because of this heightened burden of proof, it argues, KGS was required to adduce much more evidence to support the existence of the agency contract than in the case of an ordinary contract, which can be proved by a mere preponderance of the evidence. To defeat its motions for summary judgment and directed verdict, it argues, KGS was required to produce evidence of sufficient quantity and caliber to permit a factfinder to conclude that KGS had proven, by clear and convincing evidence, that KGS and KG&E had expressly or impliedly agreed that KGS would be KG&E’s agent. KG&E asserts KGS failed to meet its burden.
First, we disagree with KG&E’s definition of clear and convincing evidence. Clear and convincing evidence is not á quantum of proof, but rather a quality of proof; thus, the plaintiff establishes agency by a preponderance of the evidence, but this evidence must be clear and convincing in nature. On review, this court considers only the evidence of the successful party to determine whether it is substantial and whether it is of a clear and convincing quality. See Newell v. Krause, 239 Kan. 550, 557, 722 P.2d 530 (1986).
Secondly, without objection, the trial judge instructed the jury that the standard of proof required to show the existence of an agency relationship is clear and satisfactory evidence. To be clear and satisfactory, evidence should be “clear” in the sense that it is certain, plain to the understanding, and unambiguous, and “satisfactory” in the sense that it is so believable that people of ordinary intelligence, discretion, and caution may have confidence in it. Clear and satisfactory evidence is not a quantum of proof, but rather a quality of proof. See Highland Lumber Co., Inc. v. Knudson, 219 Kan. 366, Syl. ¶ 1, 548 P.2d 719 (1976), which states: “Where the relationship of principal and agent is in issue, the party relying thereon to establish his claim or demand has the burden of establishing its existence by clear and satisfactory evidence.”
To determine whether the record establishes an agency by agreement, the record must be examined to ascertain if the party sought to be charged as principal has delegated authority to the alleged agent by words which expressly authorize the agent to do the delegated act. If there is evidence of that character, the authority of the agent is express. If no express authorization is found, the evidence must be considered to determine whether the alleged agent possesses implied powers. The test utilized by this court to determine if the alleged agent possesses implied powers is whether, from the facts and circumstances of the particular case, it appears there was an implied intention to create an agency, in which event the relationship may be held to exist, notwithstanding either a denial by the alleged principal or whether the parties understood it to be an agency. Highland Lumber Co., Inc. v. Knudson, 219 Kan. at 370.
An agency is implied if, from statements of the parties, their conduct, and other relevant circumstances, it appears the intent of the parties was to create a relationship permitting the assumption of authority by an agent which, when exercised, would normally and naturally lead others to believe in and rely on the acts as those of the principal. While the relationship may be inferred from a single transaction, it is more readily inferable from a series of transactions. An agency will not be inferred because a third person assumed that it existed, nor because the alleged agent assumed to act as such, nor because the conditions and circumstances were such as to make such an agency seem natural and probable. Highland Lumber Co., Inc. v. Knudson, 219 Kan. at 371.
KG&E contends there was no evidence of an express agency relationship. It notes although the 1976 amendment to the Glick Contract stated that “Vendor toill undertake for the benefit of Vendee [KGirE], in performance of this contract, to extend such contracts or enter into new contracts with such producers,” there is no language which suggests or indicates a principal-agent relationship between KG&E and KGS in the other contracts. Further, it argues the various contracts over the years contain many provisions that are inconsistent with the existence of an agency relationship. Examples noted by KG&E include: (a) consistent use of language describing KGS as Vendor and KG&E as Vendee in the various contracts; (b) contract provisions providing KGS was to take title to the gas it purchased from the producers while KG&E would not receive title until KGS delivered the gas to KG&E; (c) the provision in the Glick Contract that gave KG&E a right of first refusal to buy Glick gas from KGS after the contract expired; (d) the absence of contract language that would allow KG&E a role in setting the price KGS would pay the gas producers; and (e) the Glick Contract’s explicit rejection of any KG&E obligation to take and pay for more gas than it needed at the two gas-fired plants, prohibition of KG&E from reselling the gas or using it for any other purpose, and exclusion from the contract of any gas exceeding KG&E’s need that KGS had to take to avoid minimum-take liability to the producers.
In addition, KG&E contends there is no evidence that the parties orally agreed that KGS would be KG&E’s agent.
KGS contends the several contract provisions were sufficient evidence of an express agency relationship to create a jury question. It observes the 1976 amendment to the Glick Contract provided that KGS was to extend its contracts with the gas producers “for the benefit of” KG&E. KGS notes in numerous cases an agent is defined as one who acts primarily “for the benefit of” another party. Further, it claims the words “for the benefit of ” are used by the Restatement of Agency (1933) and courts to define agency and the parties in this case used that phrase only when contracting as to gas to be dedicated to KG&E. It asserts exclusive dealing between the parties is evidence of the existence of an agency relationship and that under the Glick Contract and Contract for Additional Gas, all gas acquired by KGS was exclusively dedicated to KG&E. KGS contends it was required to obtain approval by KG&E of all gas purchases involving a capital expenditure over $100,000, which ensured that KG&E controlled and had veto power over any substantial gas acquisition expenditure by KGS. KGS also mentions use of cost-plus pricing and KG&E’s agreement to finance capital expenditures necessary for KGS to attach new supplies of gas. KGS notes that, upon the expiration of KGS’s contracts with KG&E, KG&E retained the right of first refusal for gas that KGS had purchased for KG&E’s benefit and that the Contract for Additional Gas obligated KGS to use its best efforts to purchase economically additional gas dedicated to KG&E.
KG&E contends there was no evidence of an implied agency relationship because the facts adduced in support of the alleged agency are also consistent with a different relationship, e.g., the relationship of buyer and seller, so a reasonable factfinder would not find an agency was implied under those facts. It further claims the facts are not consistent with an implied agency. KG&E cites implications of fixed pricing v. cost-plus pricing and further states the interplay between KGS and KG&E regarding KGS’s dealings with the producers could reflect either the principal’s right to control the activities of an agent or “the natural solicitude that any buyer [KGS] gives a seller [KG&E] who is an important customer.” KG&E argues the limited control it exercised over KGS did not impliedly create an agency relationship. Although KG&E, as KGS’s largest customer, did have economic clout over KGS, KG&E argues economic clout alone does not make KG&E a principal and KGS an agent.
KGS responds that KG&E’s evidence did not eliminate the fact question for the jury. It claims the “Vendor”/“Vendee” labels do not determine the nature of the relationship; rather, it is the substance of the transaction which is decisive.
KGS argues the conduct of the parties during the course of their relationship is the primary evidence that an agency relationship existed. It asserts KG&E controlled KGS’s gas acquisition efforts; KGS’s gas acquisition personnel were in contact with KG&E officials several times each week and discussed individual transactions in detail; KG&E financed advance payments to producers as an incentive for them to develop gas supplies to be purchased by KGS for exclusive dedication to KG&E; each month KGS provided KG&E detailed information regarding gas purchases and sales and new gas acquisitions; before implementing a new form contract, KGS discussed in detail the terms of the form with KG&E; KG&E specifically approved the terms of the contract extensions entered into with Barbara and Pickrell; virtually all the gas purchased by KGS was delivered to KG&E, and the exclusive dedication provisions of the contracts between KGS and KG&E precluded any substantial change in KG&E dominance. Moreover, KGS argues, the physical configuration of the system, with KGS’s lines terminating at KG&E’s plants, made KGS highly dependent on KG&E. Further, the length of the relationship between KGS and KG&E supports a finding that this was not an ordinary buyer-seller relationship but an agency relationship and KG&E officials indicated that they regarded the gas under contract to KGS as KG&E’s gas.
Although the evidence pointed out by the parties, by itself, is not conclusive that KGS was acting as an agent of KG&E in extending the producer contracts, reasonable minds could differ on the conclusions that could be drawn from this evidence in conjunction with other evidence. Under the standards of review for summary judgment and directed verdict, the trial court was required to submit the expressed or implied agency question to the jury.
II. Does the parol evidence rule prohibit consideration of any agency agreement that might have been made prior to the 1984 replacement contract?
KG&E next claims gas contracts are contracts for the sale of goods and thus are governed by Article 2 of the Uniform Commercial Code (U.C.C.), and Chapter 84 of the Kansas Statutes Annotated, citing Sunflower Electric Coop., Inc. v. Tomlinson Oil Co., 7 Kan. App. 2d 131, 139, 638 P.2d 963 (1981), rev. denied 231 Kan. 802 (1982). KG&E then claims that the applicable parol evidence rule to consider is found at K.S.A. 84-2-202, which provides:
“Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented
(a) by course of dealing or usage of trade (section 84-1-205) or by course of performance (section 84-2-208); and
(b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.”
It is a general rule that parol evidence may not be introduced to contradict, alter, or vary the terms of a written instrument, but where the contract is silent or ambiguous concerning a vital point incident thereto, parol evidence will be received to aid in its construction. Souder v. Tri-County Refrigeration Co., 190 Kan. 207, 373 P.2d 155 (1962); Stapleton v. Hartman, 174 Kan. 468, 257 P.2d 113 (1953).
K.S.A. 84-2-202 does not abolish the general parol evidence rule. It specifically provides that where the confirmatory memoranda of the parties agree as to any of the terms, or where the writing is intended as a final expression of the agreement of the parties with respect to any of the terms included therein, one may not contradict such terms by evidence of any prior agreement or contemporaneous oral agreement. However, the U.C.C. does permit such terms to be explained or supplemented.
The explanation or supplementation may be through proof of a course of dealing, usage of trade, or a course of performance and by evidence of consistent additional terms, unless the court finds an intent that the writing was to be both a complete and an exclusive statement of the terms.
It is frequently a matter of judgment as to whether or not a writing is ambiguous or silent on a controversial matter. If either condition is present, parol evidence of custom, usage, etc., would be admissible in construing the terms of the contract. However, this U.C.C. section goes one step further and allows such evidence to be introduced to explain or supplement the terms even though the writings are neither ambiguous nor silent. 7 Vernon’s Uniform Commercial Code § 84-2-202, Kansas Code Comment (1968).
K.S.A. 84-2-202, Kansas Comment 1983, states:
“This section modifies and liberalizes the application of the parol evidence rule to writings evidencing a contract of sale. Under this section, it is now easier for oral evidence to be admissible. The most important change is the reversal of the presumption in pre-Code cases that a writing was integrated and contained the entire contract. See Hudson v. Riley, 104 K. 534, 180 P. 198 (1919). This view is rejected, and under paragraph (b) it is now presumed that the writing is not integrated.
“In its operation, this section accords with the general understanding of the parol evidence rule in providing that terms set forth in a writing intended by the parties as a final expression of their agreement may not be contradicted by evidence of any prior agreement or any contemporaneous oral agreement. As noted, however, this rule applies only to the extent the terms have been finalized in a writing, and creates no presumption that all matters agreed upon have been included in the writing.”
KG&E contends the parol evidence rule bars consideration of KGS’s implied agency claim. We disagree. The jury could have found KGS was an implied agent of KG&E when KGS extended its contracts with the producers; if so, the parol evidence rule of the U.C.C. would not apply. It would not be inconsistent for the jury to find KGS and KG&E were agent and principal insofar as an extension of the KGS/producer contracts and that they were seller and buyer as to the transfer of natural gas to KG&E by KGS. Under the facts of this case, the trial judge was correct in ruling the parol evidence rule did not prohibit consideration of any agency agreement that might have been made prior to the 1984 replacement contract.
III. Did the 1984 contract between KGS and KG&E discharge or replace any agency agreement that might have been part of those previous contracts?
KG&E next contends that if an agency relationship was created by the earlier contracts, the 1984 contract between KG&E and KGS discharged or replaced that relationship. KG&E asserts the 1984 Gas Sales Agreement expressly terminated the previous contracts in toto and governed all gas deliveries when it became effective. KG&E points out the 1984 contract contains an anti-minimum take provision and an integration clause, and it Jacks the “for the benefit of” language.
KG&E claims the doctrine of substituted contract described in the Restatement (Second) of Contracts § 279 (1979) has been referred to as novation in recent Kansas cases and as abandoned contract or substituted agreement ip older cases. Invocation of the defense requires a showing of the following elements: (1) a previous valid contract; (2) agreement on a new contract; (3) validity of that new contract; and (4) intent to extinguish the old contract and substitute the new. Elliott v. Whitney, 215 Kan. 256, Syl. ¶ 1, 524 P.2d 699 (1974). Where a written contract is involved, the existence of substitution is a question of law for the pourt. W-V Enterprises, Inc. v. Federal Savings & Loan Insurance Corp., 234 Kan. 354, 362, 673 P.2d 1112 (1983). KG&E further asserts that a myriad of cases hold that where a contract acknowledges that it is a replacement for a previous contract, but does not expressly state whether claims under the prior contract are waived, that the prior claims are presumed to have perished.
KGS responds that KG&E did not move for summary judgment or directed verdict on grounds the 1984 contract discharged any prior agency contract, so it may not now appeal on that basis. It points out that KG&E argued for submission of the issue to. the jury as a question of fact; therefore, KG&E is precluded from raising the issue on appeal. It argues that, at KG&E’s request, the jury decided the 1984 contract preserved KGS’s indemnity claim against KG&E. Further, KGS. claims the 1984 contract replaced the parties’ prior agreements only with respect to deliveries of gas after September 15, 1984. It had nothing to do with past deliveries of gas or obligations created by KGS’s actions as KG&E’s agent prior to 1984. KGS argues it did not waive any prior claim it had against KG&E, pointing out that the 1984 contract provided:
“Nothing in this agreement shall be construed to alter or enlarge in any respect any other contracts or agreements by and between the parties to this Agreement for any gas delivered by Vendor to Vendee before the effective date of this Agreement under other contracts or agreements including the Predecessor Contracts.”
The construction of a written instrument is a question of law, and the instrument may be construed and its legal effect determined by the court on appeal. Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, 133, 754 P.2d 803 (1988). However, when a party erroneously requests that the determination of the issue be submitted to the jury at trial, that party cannot raise the issue on appeal and request this court to re-construe the issue it requested be submitted to the jury. Where a party persuades a court to proceed in a particular way and invites a particular ruling, the party is precluded from asserting the issue on appeal. W-V Enterprises, Inc. v. Federal Savings & Loan Ins. Corp., 234 Kan. at 362. The jury’s determinination that there was no novation will stand.
IV. Was KGS’s agency claim barred by the four-year period of limitations established by the U.C.C. for breach of a sales contract?
KG&E next cpntends KGS’s agency indemnification claim is barred by the U.C.C. statute of limitations for breach of a sales contract, K.S.A. 84-2-725. That statute provides in relevant part:
“(1) An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued. . . .
“(2) A cause of action accrues when the breach occurs, regardless of the aggrieved party’s lack of knowledge of the breach.”
KG&E asks this court to adopt the holding of Perry v. Pioneer Wholesale Supply Co., 681 P.2d 214 (Utah 1984), a minority rule, which held that in U.C.C. cases indemnification claims accrue at the same time that the underlying claim against the party seeking indemnification accrues. Under this approach, KGS’s agency claims against KG&E would have accrued contemporaneously with Barbara and Pickrell’s claims against KGS, in 1983, and would be barred under K.S.A. 84-2-725 because they were not brought within four years. KG&E suggests that because KGS was aware in 1984 that Barbara and Pickrell were asserting that KGS had breached the minimum “take or pay” provisions of its contracts with the gas producers and did not inform KG&E of this fact until more than five years later, it would be appropriate to follow Perry and its progeny and bar KGS’s claim. Most courts have rejected the Perry case and hold that a claim for indemnity accrues at the time the indemnity claimant suffers its loss, even if the indemnity claim is based on breach of contract for the sale of goods.
KGS observes that under Kansas law the statute of limitations for an indemnity claim does not commence to run until the third-party plaintiff becomes obligated, by judgment or settlement, to pay the original plaintiff. It asserts that because KGS did not settle and pay the Barbara and Pickrell claims until January 3, 1991, the statute of limitations on KGS’s third-party agency indemnity claim against KG&E had not expired before KGS filed its claim in 1989.
KGS argues the U.C.C. statute of limitations is not applicable because this is an action for indemnity, not a breach of sales contract claim. KGS’s claim for indemnity does not relate to a breach of contract for the sale of goods but arises from KG&E’s obligation as principal to indemnify its agent because of an implied obligation. By virtue of the agency agreement, KGS did not sell anything to KG&E; rather, it acted as KG&E’s agent when it extended its contracts with the producers.
KGS’s judgment is not indemnification for breach of a sales contract. The judgment is based on KGS’s claim that it extended its contracts with the producers as an agent for KG&E. KGS was liable to Barbara and Pickrell for not taking as much gas as the extended contracts required. KGS was entitled to indemnification from KG&E because it extended the contracts with the producers as an agent of KG&E. KGS’s indemnification claim as KG&E’s agent is not a breach of sales contract claim and the U.C.C. statute of limitations does not apply.
We agree with the district court’s finding that KGS’s claim for indemnification for loss it suffered as KG&E’s agent was not barred by the statute of limitations.
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The opinion of the court was delivered by
Herd, J.:
Brandon N. Irons was charged with aggravated escape from custody, K.S.A. 21-3810, and at trial was found guilty by a jury. Irons took a direct appeal to the Court of Appeals, which affirmed the district court in an unpublished opinion filed August 23, 1991. We granted Irons’ petition for review.
FACTS
In 1982, at the age of 19, Brandon N. Irons was convicted of burglary and felony theft in Butler County. He was sentenced to 2 to 10 years’ imprisonment. He was sent to the Kansas State Industrial Reformatory (KSIR) in Hutchinson for 18 months and was then paroled. Irons eventually moved to Colorado with his wife and child. There, Irons worked with one of his brothers as a high-rise windqyv washer. In 1988, he was stopped in Colorado for driving under the influence of alcohol. He became belligerent with the police and, as a consequence, his parole was revoked and he was sent back to Hutchinson. Irons was then sent to the Wichita Community Residential Center (CRC) in May 1989. CRC was a privately owned work release facility where inmates were transferred from KSIR and Lansing within a year of their release date. Formerly the old stockyards building, CRC housed between 150 and 200 inmates, primarily those convicted of felonies. There were only three or four security guards on duty around the clock. None of the dormitory rooms were locked and the inmates could move around within the building as they needed. The inmates were required to get jobs and were allowed to sign in and out of CRC in order to go to work. The facility was closed in August 1989.
On June 6, 1989, Irons gave an interview to television station KAKE regarding CRC. Although the interview lasted 20 minutes, the television station only showed a few seconds. During this interview, Irons stated he did not believe that CRC was “that bad of a program.” The next day, the other inmates told Irons he had been stupid to give the interview, and they were very angry with him. No one physically threatened Irons that night, but their anger was such that he was frightened about returning tó his dorm room which he shared with 10 other inmates. Instead, Irons slept hidden between a soda machine and a wall in another part of the facility. During the night some inmates urinated on Irons’ bunk.
The next morning, Irons returned to his dormitory room. Other inmates questioned where he had been the night before and began accusing him of being a “snitch.” They called him a woman and said ány snitch could be turned into a woman. They told Irons they were going “to punk [him] out” and “dry heave” him. This was slang for sodomize. The inmates were in Irons’ room, moving him toward the back door, when one said, “[W]hy don’t we just take you out and why don’t we just bend you over.” Another one slapped him on the ear. At this point, one of Irons’ friends said a counselor was coming, causing the other inmates to back off. Irons then went down and stood by the security office until he signed out to go to work. While he waited at the bus stop, two inmates appeared and began chasing him. He ran to a 7-Eleven, where they stopped chasing him but told him they were going to kill him when he returned.
Irons was working at the cinema at Towne West Shopping Center. Once he arrived at work, Irons called Judge Jaworski in Rutler County, who had sentenced him. Judge Jaworski said he could not do anything and suggested Irons call security at CRC. Irons then called CRC and talked to Officer Sharon Willits, the shift supervisor. He told her he was having some problems and wanted to talk to the “top person.” She advised Irons to come in and talk to CRC personnel. Irons told her if he came back the other inmates would get him, particularly if they saw him go to a guard. He had previously witnessed one inmate beat up two guards. Willits let Irons talk to Mark Ryan, CRC assistant administrator.
Irons told Ryan what had happened and that the other inmates were going to kill him. Ryan said he could move Irons to another room, but Irons replied they would still get him and did not feel he could safely come back to the facility. Ryan said he could have Irons transferred to Topeka in about a week. Irons again said he could not come back to CRC. Ryan told Irons he would call him later that evening at work. Irons waited until 5:00 or 6:00 p.m. and then called Ryan. Irons was told Ryan had left for the evening and had left no messages for Irons. Irons told CRC personnel he was not coming back and asked if he could have his return time extended from 6:00 a.m. until 9:00 a.m. It was extended until 7:00 a.m.
The following morning, June 9, 1989, Irons called Ryan at 7:00 a.m. at CRC, but Ryan was not there. Irons then called at 8:00 a.m., and Ryan was still not in. Irons called again at 10:00 or 10:30 a.m., and his counselor told him he was wanted for escape. Irons told her that Ryan was going to get him moved, but she replied Ryan was in a meeting and had said simply that Irons must return. Irons tried to explain his situation, but the counselor replied that she had no authority as to security. Irons told her he was not coming back, and he went to Texas, where he remained until he was taken into custody five months later.
Also on the morning of June 9, 1989, Officer Willits called Irons’ workplace and found he was not there. She then notified the Wichita police department of Irons’ escape. Irons was formally charged on June 13, 1989, with one count of aggravated escape from custody, K.S.A. 21-3810.
Prior to trial the State made a motion in limine requesting the court not to admit evidence regarding Irons’ motives for escaping, specifically the threats he had received from other inmates. During the hearing on the motion in limine, Irons proffered testimony regarding the threats made to him before his escape and his attempts to talk to Ryan. Irons argued this testimony supported his defense of compulsion. The trial court granted the State’s motion in limine, finding the threats were not “imminent,” and thus, as a matter of law the defense of compulsion was not available to Irons. Prior to presentation of the defense’s case, the defendant unsuccessfully moved the court to reconsider the motion in limine. At that time, Irons also proffered testimony of Bradley Bates, a man who worked with defendant at the movie theatre, and to whom the defendant had relayed his fears.
Irons was convicted by a jury on May 30, 1990. He filed a motion for acquittal and a motion for new trial on June 5, 1990. The motion for new trial again raised the issues of the compulsion defense and the trial court’s failure to give an instruction on compulsion. Both motions were denied and Irons was sentenced to one to five years’ imprisonment, to run consecutively with the previous Butler County conviction. Irons’ appeal followed.
The first issue is whether the trial court abused its discretion by granting the State’s motion in limine, thereby denying Irons a chance to present the defense of compulsion.
Irons had planned to present evidence at trial to support his claim of the defense of compulsion. Compulsion is statutorily defined at K. S.A. 21-3209 as follows:
“(1) A person is not guilty of a crime other than murder or voluntary manslaughter by reason of conduct which he performs under the compulsion or threat of the imminent infliction of death or great bodily harm, if he reasonably believes that death or great bodily harm will be inflicted upon him or upon his spouse, parent, child, brother or sister if he does not perform such conduct.
“(2) The defense provided by this section is not available to one who willfully or wantonly places himself in a situation in which it is probable that he will be subjected to compulsion or threat.”
The State, however, made a motion in limine requesting that any evidence of Irons’ motives for leaving CRC not be admitted. Relying upon State v. Milum, 213 Kan. 581, 516 P.2d 984 (1973), the State argued Irons was not in imminent fear of death or great bodily harm and, therefore, could not claim compulsion.
In Milum, the defendant planned to present the defense of compulsion to justify his escape from the Kansas State Penitentiary. Prior to the presentation of evidence, the State “entered a preliminary objection in chambers to ‘any testimony concerning the defendant’s motives for leaving the Kansas State Penitentiary.’ ” The defendant proffered testimony that a deputy warden had threatened to kill him in June or July 1970, motivating the defendant to escape on August 7, 1970. The trial court sustained the objection “’on the basis of the lack of relevancy.’ ” This court affirmed the trial court, stating: “Milum’s evidence in its most favorable light would have shown no immediate threat; since it would not establish the supposed defense it was not error to exclude it.” 213 Kan. at 582-84.
In the case at bar, the trial court agreed with the State’s analysis that once Irons got to work at Towne West he was no longer in imminent danger. Thus, the trial court found as a matter of law the proffered testimony did not constitute facts which would satisfy the requirements of the defense of compulsion and granted the State’s motion in limine. Therefore, at trial Irons, Willits, Ryan, and Bates were not allowed to testify to any threats toward Irons made by other inmates nor to any phone calls Irons had made to CRC on June 8 and 9.
On appeal, the Court of Appeals applied the rules of law pertaining to the compulsion defense stated in State v. Pichon, 15 Kan. App. 2d 527, 811 P.2d 517, rev. denied 249 Kan. 778 (1991), which also dealt with a defendant charged with aggravated escape from custody. The Pichón decision was filed on May 10, 1991, and oral argument of this case before the Court of Appeals was held on May 13, 1991.
In Pichón, the Court of Appeals adopted, with slight modification, the conditions that must exist before a prison escapee can claim the defense of compulsion as stated in People v. Lovercamp, 43 Cal. App. 3d 823, 118 Cal. Rptr. 110 (1974). The conditions are:
(1) The prisoner is faced with a threat of imminent infliction of death or great bodily harm;
(2) there is no time for a complaint to the authorities or there exists a history of futile complaints which makes any result from such complaints illusory;
(3) there is no time or opportunity to resort to the courts;
(4) there is no evidence of force or violence used towards prison personnel or other “innocent” persons in the escape; and
(5) the prisoner immediately reports to the proper authorities when he has attained a position of safety from the immediate threat. Pichon, 15 Kan. App. 2d at 533, 536.
When considering Irons’ appeal, the Court of Appeals further explained:
“This court held that all of the five conditions must exist before the defense is available. Pichon, 15 Kan. App. 2d at 533. Other courts have held that the existence of all five is not required before the defendant may present the defense. People v. Unger, 66 Ill. 2d 333, 342, 362 N.E.2d 319 (1977); Esquibel v. State, 91 N.M. 498, 501, 576 P.2d 1129 (1978). Those courts held that the existence or nonexistence of the factors goes only to the weight and credibility of the defendant’s evidence of duress or necessity.”
Relying upon State v. Hundley, 236 Kan. 461, 693 P.2d 475 (1985), the Court of Appeals discussed at length the difference between “immediate” and “imminent.” Hundley was a murder case involving the battered woman syndrome in which the defendant argued the defense of self-defense. On appeal, the defendant contended the self-defense instruction used was reversible error because it stated the defendant must reasonably believe she is faced with “immediate use of unlawful force” rather than the “imminent use of unlawful force” as stated in the statute. 236 Kan. at 464. This court stated:
“Thus, the question is whether the instruction allows the jury to consider ‘all the evidence’ or whether the use of the word ‘immediate’ rather than ‘imminent’ precludes the jury’s consideration of the prior abuse. ‘Immediate’ is defined in Webster’s Third New International Dictionary (1961): ‘Occurring, acting or accomplished without loss of time.’ p. 1129. ‘Imminent’ is defined as: ‘Ready to take place ... or impending.’ p. 1130. Therefore, the time limitations in the use of the word ‘immediate’ are much stricter than those with the use of the word ‘imminent.’ ” 236 Kan. at 466.
The Court of Appeals acknowledged the inmates had threatened Irons immediately before he left CRC. Unlike in Milum, the threats were not for some indefinite time in the future. Therefore, the Court of Appeals concluded Irons was in imminent threat of death or great bodily harm and “[t]he trial court erred by refusing the testimony for this reason.”
The Court of Appeals went on to determine whether Irons was able to meet the other four conditions required by Pichón. It found Irons could meet the second requirement of making complaints to the authorities or showing there exists a history of futility when complaints are registered, the third requirement that there is no time or opportunity to resort to the courts, and the fourth requirement that there is no evidence of force or violence used in the escape. The Court of Appeals, however, found Irons could not meet the fifth requirement of immediately reporting to the proper authorities once he reached safety. Thus, the Court of Appeals affirmed the trial court on this issue because the trial court reached the right result for the wrong reason. See State v. Shehan, 242 Kan. 127, 131, 744 P.2d 824 (1987).
Judge Davis dissented, stating he believed “all conditions of Pichón have been satisfied.” Judge Davis further stated:
“Whether it was a viable defense depends upon the jury’s determination of the evidence at trial. To say under the facts of this case that the defense of compulsion is not available is to deny the defendant a fair trial by preventing him from presenting to the jury the only theory of defense he had.
“I believe Pichón to be good law but I read it more restrictively than the majority. In my opinion, it is not enough to say that, since the defendant did not immediately report to the proper authorities when reaching Texas, he forfeits his defense of compulsion. This is especially true under the facts of this case where the defendant sought to report the danger he perceived. The authorities offered a solution that not only failed to alleviate the danger but virtually guaranteed that the threat he perceived would be carried out if he returned. I believe that, in this case, the last requirement of Pichón was met by the defendant when, safe at his place of employment and before returning to the facility, he reported to the proper authorities.”
We agree with Judge Davis. As we stated in State v. Bradley, 223 Kan. 710, 714, 576 P.2d 647 (1978): “It is fundamental to a fair trial to allow the accused to present his version of the events so that the jury may properly weigh the evidence and reach its verdict. The right to present one’s theory of defense is absolute.”
Here, the trial court and the Court of Appeals assumed Irons did not escape until he reached Texas, even though Irons repeatedly told authorities he would not return to CRC. Viewing the evidence in the light most favorable to the defendant, Irons reported the threats to the authorities, who offered him no viable alternative, forcing him to fail to return. Moreover, motions in limine are not to be used to “choke off a valid defense in a criminal action.” State v. Quick, 226 Kan. 308, 311, 597 P.2d 1108 (1979). Irons’ escape occurred when he did not return to CRC by 7:00 a.m. He made every effort to report to Ryan at that time and previously. Thus, he met the requirements of all the conditions entitling him to the defense of compulsion.
We find the trial court abused its discretion in granting the State’s motion in limine. Irons proffered evidence which would satisfy each of the five requirements of Pichón, and his defense of compulsion should have been presented to the jury with appropriate instructions.
We adopt the conditions set out in Pichón with one modification. Condition (5) should contain the phrase “imminent threat,” rather than “immediate threat,” to conform to K.S.A. 21-3209.
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The opinion of the court was delivered by
Holmes, C.J.:
Plaintiffs appeal, in what was filed as a class action, from an order of the district court granting summary j'udgment to the State and dismissing the case. We affirm.
Plaintiffs, lawyers practicing in Liberal, Kansas, brought this suit as a class action for themselves and as representatives of all lawyers who were required to represent indigent criminal defendants in this state prior to July 1, 1988, pursuant to the Indigent Defense Services Act, K.S.A. 22-4501 et seq., and the rules and regulations promulgated thereunder.
On December 15, 1987, the Kansas Supreme Court decided State ex rel. Stephan v. Smith, 242 Kan. 336, 747 P. 2d 816 (1987). Smith held that the appointment of attorneys under the indigent defense appointment system as it was then being applied was unconstitutional and granted prospective relief to take effect July 1, 1988. By that date, changes were made in statutory law and in the administrative regulations, and plaintiffs do not attack the system which has been in operation since July 1, 1988.
This is the third action filed by these plaintiffs against the State of Kansas since our decision in Smith. On January 4, 1988, suit was filed in the United States District Court for the District of Kansas seeking injunctive relief and monetary damages. That action was subsequently dismissed on 11th Amendment grounds and the dismissal was upheld on appeal. The federal court action has no bearing on the issues in this case and will not be considered further in this opinion.
On March 16, 1988, plaintiffs filed a class action petition against the State of Kansas in the district court of Seward County, Kansas, seeking to recover money damages for legal services rendered under the then-existing court appointment system. The district court granted the State’s motion for summary judgment, and plaintiffs appealed. The Kansas Supreme Court affirmed the dismissal of numerous causes of action for damages arising out of the court appointment system held unconstitutional in Smith. Sharp v. State, 245 Kan. 749, 783 P.2d 343 (1989), cert. denied 112 L. Ed. 2d 45 (1990) (hereinafter referred to as Sharp I). Two of the issues raised in Sharp I were claims for monetary damages based upon the theories of unjust enrichment and inverse condemnation. This court found that plaintiffs had not exhausted their administrative remedies as to the claim for unjust enrichment and affirmed the trial court’s dismissal of that alleged claim for damages. The court also found that the inverse condemnation theory had not been raised in the trial court and therefore was not properly before the Supreme Court. However, the court went on to note that even if an inverse condemnation theory had been raised, that theory would not state a valid cause of action.
Plaintiffs brought this action for damages as a class action suit, naming the same plaintiffs as in Sharp I, plus an additional party, Daniel H. Diepenbrock. Having exhausted their administrative remedies, plaintiffs renewed their unjust enrichment cause of action and also asserted a cause of action based upon inverse condemnation.
In the trial court the State filed a motion to dismiss on the grounds that Sharp I was res judicata to the issues in this case and that plaintiffs’ petition based upon claims of inverse condemnation and unjust enrichment failed to state a claim for which relief could be granted. Following briefs and a hearing on the State’s motion, the court adopted both arguments of the State, granted summary judgment to the State, and dismissed plaintiffs’ petition.
Plaintiffs have timely appealed, asserting (1) that the district court erred in finding Sharp I precluded this action under the theory of res judicata, (2) that the district court erred in holding that the inverse condemnation claim failed to state a claim upon which relief could be granted, and (3) that the court erred in holding that the unjust enrichment, claim failed to state a claim upon which relief could be granted.
Before considering the issues raised by the plaintiffs, there is a threshold question raised by our decision in Smith which should be addressed and which we find dispositive of the issues herein. In Smith the attorney general filed an original action in mandamus to compel Judges Smith and Fromme, of the Fourth Judicial District, to perform duties specified by the Indigent Defense Services Act, K.S.A. 22-4501 et seq., and the rules and regulations promulgated by the State Board of Indigents’ Defense Services as published at K.A.R. 105-1-1 et seq. The respondent judges had issued orders which allegedly violated the statutes and rules and regulations.
In Smith, former Chief Justice Miller, in a lengthy and scholarly opinion, exhaustively reviewed the history of appointed counsel in criminal cases and the constitutionality of the statutory system as it was being administered in Kansas at the time. In a unanimous opinion this court held that the' statutory scheme for appointment and payment of counsel for indigent defendants as administered violated both the federal and Kansas Constitutions. In doing so, the court concluded:
“The present system as now operated, we have held, violates certain provisions of the United States and the Kansas Constitutions. Changes are required. These may come about by both legislative and administrative action. The adoption of different bases for computing appointed counsel’s compensation, the budgeting and funding of the same, and the possible extension of public defender systems or the adoption of contracts to provide counsel for indigents in some areas, or an intermixture of those and possibly other solutions, takes time. Meanwhile, the indigent criminal defendants must have counsel, and that is a burden which the bar must continue to shoulder, at least temporarily, under the present system.
“. . . Respondents are directed to comply with the present statutes and regulations until July 1, 1988, and to appoint counsel under the present system until that date, taking care to see that competent counsel are appointed and no unreasonable burden or hardship is placed upon any attorney or attorneys. As we indicated in our temporary order, entered on July 17, 1987, it is the time necessarily spent by an attorney on indigent appointments, and not the number of appointments, which is the important factor in determining reasonableness or unreasonableness, fairness or hardship.
“The requested order of mandamus is denied.” 242 Kan. at 383-84.
Does Smith, implicitly if not specifically, preclude the present action because our decision that the previous statutory scheme was unconstitutional was not to become effective until July 1,
1988, some five and a half months after the rendering of the opinion? We think so.
Unfortunately, the issue which we now deem to be controlling was not raised in Sharp I, although it should have been, and as a result was not considered by this court in reaching its prior decision. The learned trial judge in Sharp I, in a short letter opinion, stated:
“The motion for summary judgment is granted.
“The plaintiffs brought this action for damages arising out of an alleged failure by the state to pay them for court appointed attorney services. The plaintiffs stress several theories which they believe entitle them to recover. The real issue here is whether or not the plaintiffs have stated a cause of action upon which relief may be granted. I think not.
“Damages alone do not create a cause of action. A party must present a recognizable cause of action to support their claim. The Kansas Supreme Court has ruled in the case of State ex rel. Stephan v. Smith, 242 Kan. 336, that the former method of compensation for appointed counsel violated the equal protection clauses of the U.S. and Kansas Constitutions. The court required the state to comply with existing statutes and regulations until July 1, 1988, and then adopt . . different bases for computing appointed counsel’s compensation, the budgeting and funding of the same, and the possible extension of public defender systems or the adoption of contracts to provide counsel for indigents in some areas, or an intermixture of those and possibly other solutions . . . .’ The court recognized that such action ‘. . . takes time,’ and simply stated that indigent defendants must have counsel, ‘and that is a burden which the bar must continue to shoulder, at least temporarily, under the present system.’
“It is clear to me that the Kansas Supreme Court decidedly settled the issue presented by the plaintiffs.
“Accordingly, I am directing summary judgment for the defense. Mr. Campbell is to prepare a Journal Entry for Mr. Sharp’s review and approval.”
It appears to us that although counsel for the parties in Sharp I made numerous constitutional and other arguments, the trial court cut through all of them and actually determined that our opinion in Smith controlled and was to be applied prospectively only, beginning July 1, 1988. We conclude the trial court’s interpretation of our opinion in Smith was correct.
The determination of whether a judicial decision which overrules prior case law or holds statutory law to be unconstitutional should be applied prospectively or retroactively has been the subject of literally hundreds, if not thousands, of cases. It has also been the subject of numerous treatises, articles, and legal encyclopedias. We will not attempt to consider the subject at length, but some basic principles and rules are worthy of repeating.
The guiding principles underlying the prospective-retroactive application of an appellate court’s decision are well settled. It has long been recognized that an appellate court has the power to give a decision prospective application without offending constitutional principles. Carroll v. Kittle, 203 Kan. 841, 851-52, 457 P.2d 21 (1969). See Gt. Northern Ry. v. Sunburst Co., 287 U.S. 358, 77 L. Ed. 360, 53 S. Ct. 145 (1932); Vaughn v. Murray, 214 Kan. 456, 464, 521 P.2d 262 (1974). In Vaughn, we said, “As a matter of constitutional law, it can safely be said, retroactive operation of an overruling decision is neither required nor prohibited.” 214 Kan. at 464.
In the landmark case of Henry v. Bauder, 213 Kan. 751, 518 P.2d 362 (1974), this court held the longstanding Kansas guest statute to be unconstitutional. In addition to striking down the statute, the opinion also overruled prior existing case law. 213 Kan. at 762. However, there was no determination of whether the decision was to be applied retroactively or prospectively. Shortly thereafter, in Vaughn, 214 Kan. 456, the court was called upon to determine the retroactive or prospective effect of its earlier holding in Bauder.
In considering whether an overruling decision should be applied prospectively or retroactively, this court in Vaughn identified four options:
“(1) Purely prospective application where the law declared will not even apply to the parties to the overruling case; (See cases collected 10 A.L.R.3d, § 7, p. 1393.) (2) Limited retroactive effect where the law declared will govern the rights of the parties to the overruling case but in all other cases will be applied prospectively; (See Carroll v. Kittle, 203 Kan. 841, Syl. ¶ 10, 457 P.2d 21; and cases collected in 10 A.L.R.3d, § 8[b], p. 1399.) (3) General retroactive effect governing the rights of the parties to the overruling case and to all pending and future cases unless further litigation is barred by statutes of limitation or jurisdictional rules of appellate procedure; (See cases collected in 10 A.L.R.3d, § 8[e], pp. 1407-1412.) and (4) Retroactive effect governing the rights of the parties to the overruling case and to other cases pending when the overruling case was decided and all future cases, but limited so the new law will not govern the rights of parties to cases terminated by a judgment or verdict before the overruling decision was announced. (See Hanes v. State, 196 Kan. 404, 411 P.2d 643, and cases collected in 10 A.L.R.3d, § 8 [c, d], pp. 1401-1407.)” 214 Kan. at 465-66.
This court has also noted that “it is clear that the court is free to adopt any of the alternatives set forth in Vaughn v. Murray, any combination thereof, or any other rule to establish an effective date of an overruling decision which is fair, just and equitable.” Thome v. City of Newton, 229 Kan. 375, 379, 624 P.2d 454 (1981).
While it should be noted that the annotation found in 10 A.L.R.3d 1371 was directed to judicial decisions which overruled prior court decisions, the principles set forth therein have generally been applied to decisions holding statutes to be unconstitutional, as this court did in Vaughn.
In Vaughn, this court recognized five factors commonly relied upon by courts in determining the retroactivity question:
“Some of the factors which have been considered are; (1) Justifiable reliance on the earlier law; (2) The nature and purpose of the overruling decision; (3) Res judicata; (4) Vested rights, if any, which may have accrued by reason of the earlier law; and (5) The effect retroactive application may have on the administration of justice in the courts.” 214 Kan. at 464.
Although we might have been more specific in our concluding language in Smith, we think it is clear that the intent of that decision was that it would only operate prospectively beginning July 1, 1988. In Smith we held:
“Respondents are directed to comply with the present statutes and regulations until July 1, 1988, and to appoint counsel under the present system until that date.” 242 Kan. at 384.
Assuming, for the sake of argument, that our directions in Smith did not clearly and specifically state the decision was only to be applied prospectively, an evaluation of the five factors identified in Vaughn would certainly support, if not compel, such a conclusion.
The first factor is whether there was any justifiable reliance on the earlier law which worked to the detriment of the plaintiffs. Certainly the plaintiffs cannot demonstrate any detrimental reliance in performing services under the old system. The historical and time-honored duty of a lawyer to provide pro bono services to the indigent was explored in depth in Smith and need not be repeated here. On the other hand, the State of Kansas and the State Board of Indigents’ Defense Services had, in good faith, relied upon the statutes and regulations since their inception and had of necessity used general fund tax dollars of the citizens of Kansas in doing so. Such reliance was fully justified not only by the duly enacted statutes but also by the historical precedent which existed prior to the statutes and as recognized in numerous cases, dating back as far as Case v. Shawnee Co., 4 Kan. 511 (1868).
The second factor recognized in Vaughn is the nature and purpose of the overruling decision. The announced purpose of the decision in Smith was to prevent future constitutionally inadequate compensation of attorneys. It was not to create any new rights to additional compensation for services already rendered and paid for under the existing law. This court recognized the seriousness of the situation when it directed the bar of Kansas to continue to furnish services under a system the court found to be constitutionally deficient. That holding does not comport with any intent to create additional retroactive rights and certainly it was never intended that the purpose of the decision was to reach back into the past and provide further compensation for services already rendered.
The third factor is res judicata, and it must be conceded that the principles of that doctrine are not applicable to the Smith decision as it relates to the present case.
The fourth factor is the extent to which vested rights, if any, may have accrued by reason of the earlier law. Prior to our decision in Smith, there were no vested rights for attorneys to receive compensation over and above the amounts paid pursuant to the then-existing law.
The final factor from Vaughn is the effect that retroactive application might bear on the administration of justice in the courts. While the actual impact would be impossible to predict with any great degree of certainty, it is obvious that extensive litigation and judicial time would be required to determine on a case-by-case basis the extent to which each attorney might have' been undercompensated. Even in a class action suit, each claim would have to be given individual attention, and consideration of the numerous variables applicable to each case would result in an intolerable burden upon an already underfunded and understaffed judicial system.
We conclude and, therefore, hold that our decision in Smith which found the indigent defense services system then in effect to be unconstitutional as then applied had prospective application only as to services rendered after July 1, 1988. The system as administered prior to that date controlled payment for services rendered prior to July 1, 1988, and plaintiffs have no claim or cause of action for any additional compensation for services rendered prior to such date.
While it is true that the trial court in this case did not base its decision on the issue here determined, it has long been the rule that a trial court decision which reaches the right result will be upheld on appeal even though it is based upon an erroneous reason. Collins v. Heavener Properties, Inc., 245 Kan. 623, Syl. ¶ 2, 783 P.2d 883 (1989); Prairie State Bank v. Hoefgen, 245 Kan. 236, Syl. ¶ 3, 777 P.2d 811 (1989).
In view of the decision reached herein, it is not necessary to consider further the arguments of the plaintiffs.
The judgment is affirmed. | [
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The opinion of the court was delivered by
Lockett, J.:
Nancy Bratt appeals her conviction of two counts of aggravated intimidation of a witness or victim under 18 years of age, K.S.A. 21-3833(d). Dennis Bratt appeals his convictions of two counts of indecent liberties with a child, K.S.A. 1990 Supp. 21-3503(l)(b). Each defendant claims the trial judge improperly (1) admitted hearsay statements of the child-victim witness in violation of the Confrontation Clause of the Sixth Amendment and § 10 of the Kansas Bill of Rights; (2) permitted testimony concerning the child’s actions and statements by use of anatomical dolls; (3) excluded expert testimony concerning the unreliability of testimony based on use of anatomical dolls and the suggestibility of children when interviewed by adult interrogators concerning alleged sexual abuse; (4) prevented defendants from reading to the jury the transcript of the child’s statement given at the second K.S.A. 1990 Supp. 60-460(dd) hear ing; (5) excluded and/or adversely commented on defendants’ proffered evidence from lay witnesses; and (6) consolidated defendants’ cases for trial contrary to K.S.A. 22-3202(3). Defendants further claim there was insufficient evidence to convict either defendant.
Defendants Dennis and Nancy Bratt are the parents of R.B., the child-victim witness.
On September 9, 1990, R.B., the Bratts’ five-year-old son, was playing with M.D., the seven-year-old son of C.D., a neighbor of the Bratts. C.D. walked into her bedroom where the two were playing and saw R.B. straddling M.D.’s stomach. They were hugging and kissing. C.D. asked R.B. what they were doing. R.B. said they were playing games. When C.D. asked R.B. what kind of games, he said “sex games.” When she asked him who else he played sex games with, R.B. named a boy who lived across the street, “Big Robert.” She then asked if R.B. also played sex games with his father. R.B. said yes.
C.D. reported her conversation with R.B. to Officer Tony Barnes of the Junction City Police Department. Officer Barnes went to the Bratt home and took R.B. into protective custody. Officer Barnes interviewed R.B. in private, using four drawings of nude white males of various ages. He asked R.B. to select a drawing that represented R.B. and one that represented his father. R.B. picked the white grammar-school-age male to represent himself and the white teenage male to represent his 40-year-old father. Barnes told R.B. he wanted him to put an “X” where his father had touched him. At first, R.B. made one “X” on the paper between the depictions of the front view and back view of the white grammar-school-age male. Officer Barnes then asked R.B. to make an “X” on the picture of the body where his father had actually touched him and make an “X” on the other picture where he had touched his father. R.B. subsequently made several “X’s” on each drawing, including directly on the genitals of the drawing of the white grammar-school-age male and the drawing representing his father. In response to Officer Barnes’ questions, R.B. indicated that he and his father wore their clothes when they played the games but sometimes his father would take out his penis and let R.B. play with it. Officer Barnes said that R.B. used the word “penis.” After Officer Barnes concluded his in terview, the matter was turned over to a juvenile officer, Robert Grant.
On September 10, 1990, Officer Grant and SRS Social Worker Veronica Camp jointly interviewed Robert. Because R.B. was uncommunicative, he was given clothed anatomically correct dolls and asked to select a doll representing everyone involved in the sex games. Camp testified at trial that R.B. selected a black male child to represent Big Robert, a white male child to represent himself, and a white adult male to represent his father but that R.B. was unable to find a doll to represent M.D., because he had selected the only white male child doll to represent himself. Camp testified that R.B., without prompting, immediately removed the clothes from the dolls representing himself and his father and placed them face-to-face in a sexual position.
Officer Grant testified that R.B. selected two dolls, one to represent himself and one to represent his father.. Grant also testified that he told R.B. it was okay if he wanted to remove the dolls’ clothes.
During the interview, R.B. used the dolls to describe various forms of sexual contact with his father. After the interview, R.B. was taken to the Geary County Community Hospital emergency room and examined for possible sexual assault. No physical evidence of trauma was found.
R.B. was sent for therapy with Lamar Roth, a master’s level psychologist. Roth testified at trial that he had been provided with little information about the specifics of R.B.’s case. Roth testified that when he presented R.B. with anatomical dolls, R.B. immediately disrobed them. Roth admitted that he was unaware that R.B. had previously been exposed to the use of anatomical dolls. At one point, Roth observed R.B. place the boy doll and the mother doll in various sexual positions. This caused Roth to suggest to Camp the possibility of sexual activity between R.B. and his mother. Camp and Grant reinterviewed R.B., again using the anatomical dolls. This time, using the adult female doll and the boy doll, R.B. indicated sexual contact with his mother.
Prior to a temporary custody hearing on September 11, 1990, Camp overheard Nancy Bratt talking to R.B. outside the courtroom. At trial, Camp testified Nancy “told [R.B.] not to say anything, to shut up and not to talk, not to say anything.” Camp neither reported this statement to the court at that time, nor did she make a report about this incident in her SRS case activity log until some time later. Camp also testified at trial that, on September 26, 1990, R.B. told her during one of the visitations at her office that his mother took him aside and, “asked him had he told, had he talked. [R.B.] said he told his mom no. And [R.B.] said the mom told him not to talk, not to tell anybody.” Again, Camp failed to report the conversation or include this conversation in her log for several weeks. Camp also testified that R.B. informed her, at a later date, that his mother had directed him “not to talk, not to tell anybody what’s going on in their home,” and “not to talk to the judge, not to talk to the police, not to talk with [Camp].”
R.B. did not testify during his parents’ trial. The trial judge admitted his statements, given to the other State’s witnesses, under K.S.A. 1990 Supp. 60-460(dd). Dennis Bratt was convicted of two counts of indecent liberties with a child. Nancy Bratt was convicted of two counts of aggravated intimidation of a witness, but acquitted of a charge of indecent liberties with a child. Dennis Bratt was sentenced to concurrent terms of 4 to 15 years. Nancy Bratt was sentenced to maximum consecutive terms for the two Class E felonies. Both defendants appealed.
Defendants first claim the trial court improperly admitted R.B.’s hearsay statements under K.S.A. 1990 Supp. 60-460(dd) in violation of the Confrontation Clause of the Sixth Amendment of the United States Constitution and § 10 of the Kansas Bill of Rights. Defendants assert that all testimony relating to what R.B. said to C.D., Officers Barnes and Grant, SRS worker Veronica Camp, foster parent Eula Wright, and psychologist Lamar Roth was inadmissible as violative of the Confrontation Clause.
K.S.A. 1990 Supp. 60-460(dd) provides:
“Evidence of a statement which is made other than by a witness while testifying at the hearing, offered to prove the truth of the matter stated, is hearsay evidence and inadmissible except:
“(dd) Actions involving children. In a criminal proceeding ... a statement made by a child, to prove the crime ... if:
“(1) The child is alleged to be a victim of the crime . . . ; and
“(2) the trial judge finds, after a hearing on the matter, that the child is disqualified or unavailable as a witness, the statement is apparently reliable and the child was not induced to make the statement falsely by use of threats or promises.
“If a statement is admitted pursuant to this subsection in a trial to a jury, the trial judge shall instruct the jury that it is for the jury to determine the weight and credit to be given the statement and that, in making the determination, it shall consider the age and maturity of the child, the nature of the statement, the circumstances under which the statement was made, any possible threats or promises that might have been made to the child to obtain the statement and any other relevant factor.”
There were two K.S.A. 1990 Supp. 60-460(dd) hearings prior to the Bratts’ trial. The first hearing was before a district magistrate judge just prior to the preliminary examination. The district magistrate judge determined R.B. was not unavailable. R.B. then testified at the preliminary examination.
The second hearing was held by the district judge pursuant to the State’s second motion to admit the child’s statements under K.S.A. 1990 Supp. 60-460(dd). After, reading the transcript of the preliminary examination and hearing witnesses testify as to what R.B. had told them, the district judge determined that R.B. “in the presence of the Court, the formality of the courtroom, and the presence of the parents was unable to understand the questioning, the importance of the proceedings, and application of an oath, or the relevancy of an oath,” and thus he was unavailable as a witness. With regard to R.B.’s out-of-court statements, the district judge found they were apparently reliable, were not induced or made falsely by the use of threats or promises, and were admissible at trial as an exception to the hearsay rule under K.S.A. 1990 Supp. 60-460(dd). R.B.’s hearsay statements were introduced during- the jury trial through the testimony of various witnesses.
Defendants allege the district judge failed to consider Idaho v. Wright, 497 U.S. _, 111 L. Ed. 2d 638, 110 S. Ct. 3139 (1990), when he ruled the hearsay statements admissible, although a copy of the Wright decision was given to the district judge during the second 60-460(dd) hearing. Defendants assert the holding of the United States Supreme Court in Wright controls the admission of child victim hearsay and that the admission of hearsay statements attributed to R.B. violated the rules of the Wright case and thus the Confrontation Clause of the Sixth Amendment.
In Wright, the United States Supreme Court considered whether the admission at trial of hearsay statements made by a child to an examining pediatrician violated a defendant’s rights under the Confrontation Clause of the Sixth Amendment. The trial court had found the child declarant was not capable of communicating to the jury and allowed admission of her statements to a pediatrician alleging sexual abuse under Idaho’s residual hearsay exception. The Supreme Court of Idaho found the hearsay testimony violated the federal constitutional right to confrontation because (1) the testimony did not fall within a traditional hearsay exception and was based on an interview that lacked procedural safeguards, and (2) a younger daughter’s statement lacked sufficient particularized guarantees of trustworthiness and the admission of that statement was not harmless. The Idaho Supreme Court reversed the conviction and remanded the case for a new trial. The United States Supreme Court granted the State’s Petition for certiorari.
On review, the United States Supreme Court noted the Confrontation Clause bars admission of evidence that would otherwise be admissible under an exception to the hearsay rule. It cited Ohio v. Roberts, 448 U.S. 56, 65 L. Ed. 2d 597, 107 S. Ct. 2531 (1980), for determining when incriminating statements admissible under the hearsay rule met the requirements of the Confrontation Clause. Roberts noted the Confrontation Clause operates in two ways when determining the admissibility of hearsay statements. First, the Sixth Amendment establishes a rule of necessity. In the usual case, the prosecution must either produce or demonstrate the unavailability of the declarant whose statement it wishes to use against the defendant. Second, once a witness is shown to be unavailable, the witness’ statement is admissible only if it bears adequate indicia of reliability. 448 U.S. at 65. Reliability can be inferred where the evidence falls within a firmly rooted hearsay exception. If the evidence does not fall within a firmly rooted hearsay exception, the evidence must be excluded absent a showing of particularized guarantees of trustworthiness. 448 U.S. at 66.
Applying Roberts to the facts of Wright, the Court, in a 5-4 decision, stated the question was whether the State, as the proponent of evidence presumptively barred by the hearsay rule and the Confrontation Clause, had carried its burden of proving that the child’s statements to the pediatrician bore sufficient indicia of reliability to withstand scrutiny under the Confrontation Clause. It noted Idaho’s residual hearsay exception was not a firmly rooted hearsay exception for Confrontation Clause purposes. Thus, the State was required to show particularized guarantees of trustworthiness of the statements. Ill L. Ed. 2d at 652-53.
The Wright Court stated that particularized guarantees, of trustworthiness required for admission of a hearsay statement under the Confrontation Clause must be shown from the totality of the circumstances that surround the making of the statement and that render the declarant particularly worthy of belief. Ill L. Ed. 2d at 655. Because evidence possessing particularized guarantees of trustworthiness must be at least as reliable as evidence admitted under a firmly rooted hearsay exception, evidence admitted under the former requirement must similarly be so trustworthy that adversarial testing would add little to its reliability. Ill L. Ed. 2d at 656. The Court observed that unless an affirmative reason, arising from the circumstances in which the statement was made, provides a basis for rebutting the presumption that a hearsay statement is not worthy of reliance at trial, the Confrontation Clause requires exclusion of the out-of-court statement. Ill L. Ed. 2d at 656.
The Court pointed out there are a number of factors that properly relate to whether hearsay statements made by a child witness in a child sexual abuse case are reliable, e.g., spontaneity and consistent repetition, mental state of the declarant, use of terminology unexpected of a child of similar age, and lack of motive to fabricate. These factors also apply to whether such statements bear particularized guarantees of trustworthiness under the Confrontation Clause. This list is not exclusive. The Court concluded the unifying principle is that these factors relate to whether a child declarant was particularly likely to be telling the truth when the statement was made. Ill L. Ed. 2d at 656.
Although the Bratts’ trial was two years after our decision in State v. Kuone, 243 Kan. 218, 757 P.2d 289 (1988), neither party cited that case, nor did the trial judge consider the factors required by Kuone when determining if the child’s statements were admissible under 60-460(dd). In Kuone, the defendant was convicted by jury trial of indecent liberties with a child and aggravated criminal sodomy. The main evidence against the defendant at trial was hearsay statements made by the alleged victim, F.S., an eleven-year-old mildly retarded child, who functioned at the late first grade to early third grade level. The trial court determined that the child’s hearsay statements were admissible under 60-460(dd). On appeal, Kuone contended that the district court erred in ruling that out-of-court statements made by the alleged victim were admissible pursuant to 60-460(dd) in that (1) the victim was not “unavailable” to testify and (2) there were not “adequate indicia of reliability” surrounding her out-of-court statements.
The out-of-court statements made by F.S. to her special education teacher, her mother, and an investigating police officer, as well as her testimony given at the preliminary examination, were entirely consistent. The State argued that F.S. was unavailable to testify as a witness within the meaning of 60-460(dd)(2). The trial court agreed with the prosecution and stated that F.S. was unavailable because of the potential harm to F.S. if she were to testify at trial (a doctor had testified that the trauma of testifying during the preliminary examination had caused F.S. to have a breakdown), because F.S. was incompetent as a witness and was “out of contact with reality.” 243 Kan. at 222.
We determined “unavailable as a witness” as used in 60-460(dd) also includes situations where a witness is unable to be present or to testify at a hearing because of death or then-existing physical or mental illness. We concluded the following factors are relevant to the determination of whether a victim witness is unavailable because of psychological trauma or disability: (1) the probability of psychological injury as a result of testifying, (2) the degree of anticipated injury, (3) the duration of the injury, and (4) whether the expected psychological injury is substantially greater than the reaction of the average victim of rape, kidnapping, or other violent act. Other factors may also be relevant. 243 Kan. 218, Syl. ¶ 2. We concluded that there was ample competent evidence to support the finding of the trial court that the child witness was unavailable and we affirmed Kuone’s convictions.
Here, the district judge was apparently unaware of our decision in Kuone and failed to determine if the hearsay statement of the child had the particularized guarantees of trustworthiness as required by Wright to justify the exception to the general rule prohibiting the admission at trial of hearsay statements. The district judge merely determined pursuant to 60-460(dd) that R.B. was disqualified and unavailable to testify as a witness against the Bratts and that R.B.’s statements were apparently reliable and he was not induced to make the statement falsely by use of threats or promises; therefore, the statements were admissible as a hearsay exception. Under these circumstances, the hearsay statements of the child were inadmissible under the Confrontation Clause and the Bratts’ convictions must be reversed.
Defendants next contend the trial court improperly permitted testimony of the child’s actions and statements with the anatomical dolls. The defendants contend R.B.’s actions and conduct with the dolls is communicative in nature and constituted hearsay under K.S.A. 60-459(a). Defendants argue that because R.B.’s actions and conduct with anatomical dolls was hearsay, that hearsay was subject to the same presumption of unreliability as the child’s statements made to others and admitted under K.S.A. 1990 Supp. 60-460(dd) and should be admitted only if the State establishes that the conduct with the dolls is particularly trustworthy.
K.S.A. 60-459(a) provides:
“Definitions. As used in K.S.A. 60-460, its exceptions and in this section:
(a) ‘Statement’ means not only an oral or written expression but also nonverbal conduct of a person intended by him or her as a substitute for words in expressing the matter stated.”
We note throughout the discussion of the issues related to use of anatomical dolls by R.B. defendants equate “play” with anatomical dolls to “use” of anatomical dolls to explain or describe an act or event that occurred. Here, the anatomically correct dolls were used to assist R.B. in explaining what he said were “sex games.” Under the facts, R.B.’s use of anatomically correct dolls was hearsay. The trial court failed to make the particularized findings required by the Confrontation Clause of the Sixth Amendment as set out in Kuone and Wright for admission of hearsay under K.S.A. 1990 Supp. 60-460(dd).
Defendants next contend the trial court improperly consolidated defendants’ cases for trial contrary to K.S.A. 22-3202(3). A defendant in a criminal trial is entitled to have his or her case decided on it own merits, i.e., to have guilt or a finding of not guilty judged solely on the basis of the evidence properly admissible as to each defendant. When two or more defendants are tried together, there is the danger that the jury may be unable to treat separately the evidence introduced during the trial as to each defendant.
Defendants were originally charged in separate complaints/in-formations. The district judge initially denied the State’s motion to consolidate based upon his pretrial ruling that the State could introduce evidence of Dennis Bratt’s prior conviction for sexual battery under K.S.A. 60-455. Later, the judge reversed his decision to admit the evidence and consolidated the cases for trial. Both defendants objected, contending that consolidation under K.S.A. 22-3202(3) was not proper. K.S.A. 22-3202(3) states:
“Two or more defendants may be charged in the same complaint, information or indictment if they are alleged to have participated in the same act or transaction or in the same series of acts or transactions constituting the crime or crimes. Such defendants may be charged in one or more counts together or separately and all of the defendants need not be charged in each count.”
The State contends the evidence against each parent was virtually identical, the facts clearly depict a common scheme to sexually abuse R.B., and the “sex games” occurred in the family home. It claims the collateral evidence of R.B.’s intimidation by his mother proved material in demonstrating to the jury that Dennis Bratt was more likely to be culpable for the sex offenses given his wife’s assiduous efforts to silence their child. The State concludes joinder was proper and that there was no prejudice to either defendant by joinder.
Defendants argue the State could not allege in the complaints against the Bratts that the defendants acted in concert as part of a common scheme or that the acts were so closely connected in time, place, and occasion that proof of one charge would require proof of the others. Defendants assert the charges of aggravated intimidation of a witness against Nancy Bratt are separate, distinct, and independent allegations and proof of those charges was different than the proof required for the indecent liberties charges. Finally, Dennis Bratt contends that he was prejudiced by the joinder when evidence of the charge of aggravated intimidation of a witness against Nancy Bratt was admitted in the consolidated trial. Dennis Bratt points out there was no allegation by the State in the complaint or evidence introduced during the trial that he was aware of Nancy’s alleged admonitions to R.B. Dennis Bratt concluded that, although evidence of those incidents was inadmissible as against him, in a joint trial, he could not keep that evidence from the jury.
In State v. Roberts, 223 Kan. 49, 574 P.2d 164 (1977), Charles D. Roberts, Robert Crittenden, James E. Smith, and Robert L. Taylor were jointly charged in an information with various crimes arising from two separate incidents. Roberts, Crittenden, Smith, and Taylor were charged with aggravated robbery and conspiracy to commit aggravated robbery in connection with the robbery of an individual named Fletcher. Roberts was also charged with aggravated burglary and misdemeanor theft of the pistol in connection with the Fletcher robbery. In addition, Crittenden and Taylor were charged with aggravated robbery of the Wishing Well bar. After the preliminary hearing, counsel for Roberts and Smith moved for separate trials, claiming the State’s evidence as to the Wishing Well incident was wholly unrelated to the crimes with which they were charged.
In Roberts we noted that K.S.A. 22-3202(3) provides two or more defendants may be joined and tried together (1) when each of the defendants is charged with accountability for each offense included, or (2) when each of the defendants is charged with conspiracy and some of the defendants are also charged with one or more offenses alleged to be in furtherance of the conspiracy, or (3) when in the absence of a conspiracy it is alleged the several offenses charged were part of a common scheme or were so closely connected in time, place, and occasion that proof of one charge would require proof of the others. 223 Kan. at 55.
The Roberts court concluded if two or more defendants have been tried together and none of the requirements of K.S.A. 22-3202(3) have been met, a misjoinder results and is an absolute ground for reversal and separate trials. 223 Kan. at 55.
Joinder was not proper in this case. It was not, and could not be, alleged by the State that the several separate offenses charged against each of the defendants were part of a common scheme or were so closely connected in time, place, and occasion that proof of one charge would require proof of the others.
We have examined the other claims raised by the defendants which relate to introduction of evidence or refusal of the trial judge to admit evidence and find the trial judge did not abuse his discretion.
The judgment of the district court is reversed, and the matter is remanded for new and separate trials of the defendants. | [
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The opinion of the court was delivered by
Herd, J.:
This is a breach of contract action arising out of an application for life insurance. Richard I. Thomas applied for life insurance from Monumental Life Insurance Company (Monumental) through its agent, Ronald Thomas, who was also Richard’s brother. Richard applied for the insurance on July 2, 1986, and died January 28, 1987 without being issued an insurance policy or being refunded the first month’s premium he had paid at the time of application. Grover Thomas (Grover), the beneficiary of Richard’s life insurance, brought this action against Ronald and Monumental contending they owed him the proceeds of Richard’s insurance because Richard was covered at the time of his death by the temporary coverage provided by the conditional receipt given to Richard at the time of application. The trial court entered judgment in favor of Grover and against Monumental. Monumental appeals.
Let us examine the controlling facts. On July 2, 1986, Richard applied for $50,000 of life insurance coverage from Monumental through its agent, his brother Ronald. Richard named his father, Grover Thomas, as the beneficiary. At the time the application was written, Richard paid the initial monthly premium of $16.45 in cash. Because of Richard’s age, he was not required to get a medical physical before being issued insurance.
In exchange for the application and premium payment, Ronald signed and gave Richard a conditional receipt, which stated in part:
“IMPORTANT: THIS CONDITIONAL RECEIPT DOES NOT PROVIDE ANY INSURANCE UNTIL ALL CONDITIONS ARE MET.
“(1) If all the following conditions are met the insurance applied for shall become effective as of the date of this receipt or the latest required medical examination, whichever is later, subject to the terms and conditions of the policy applied for. The conditions are:
(a) payment of an amount equal to the first full premium for the benefits applied for to the Agent at time of signing the application.
(b) completion of the application; provided, however, that if the Company makes any change as to amount, classification, plan of insurance, age, benefit, or adds any restrictive rider, the applicant’s written acceptance of such change is necessary before any insurance becomes effective.
(c) all required medical examinations have been completed.
(d) and the Company is satisfied that on the date of the application each person to be insured is a risk insurable and acceptable under its rules, limits and standards for the plan and amount applied for at its standard rate of premium.
“(2) If within 45 days from, the date hereof a policy has not been issued to the applicant, then the application shall be deemed to have been declined by the Company and any deposit paid will be refunded.
“(3) No agent has the authority to modify the application or this receipt, or to bind the Company by making any promise or representation contrary to the provisions hereof.” (Emphasis added.)
Monumental has a company policy against agents acting as witnesses for applications by the agent’s relatives. The company’s policy states:
“Applications upon your life, members of your immediate family or your relatives must be written by an unrelated licensed agent or member of management, who will also witness the signature. Your name, of course, is to be inserted in the space for placement and commission credit.”
Despite this policy, Ronald had taken applications from his family members on numerous prior occasions, including applications by his wife, two daughters, an uncle, a sister, a niece, and his father. None of these applications had been written or witnessed by an unrelated agent. All these applications, however, had been accepted by Monumental and policies had been issued without inquiry by the company.
On July 2 or 3, 1986, Ronald submitted Richard’s application, along with the $16.45, to Monumental. Richard’s application was first given to an assistant district administrator, Lisa Florez, at Monumental’s office in Kansas City. She questioned the validity of the application because it was written in violation of the company’s policy. Florez, therefore, brought it to the attention of the district manager, P.J. West, rather than following the normal procedure of forwarding the application to the home office for consideration. Florez also gave West the $16.45 cash deposit which had been submitted with the application.
Upon review of the application, West determined Ronald had violated Monumental’s policy against writing applications for relatives and witnessing relatives’ signatures. On July 3, 1986, West rejected Richard’s application and put it and the cash deposit in an envelope in Ronald’s mail slot at the company office. West also enclosed a note asking Ronald to see West. .
Although West and Ronald attended meetings twice a week at Monumental’s office, they never discussed Richard’s application. At trial, Ronald testified he never received the envelope with Richard’s application and premium payment with West’s note. Monumental did not issue a policy to Richard. Richard paid no additional monthly premiums to Monumental. Monumental received no inquiries about the status of Richard’s application from Richard or Ronald.
Richard died January 28, 1987, 165 days after the expiration of the conditional receipt. Upon denial of coverage by Monumental, Grover brought this action to recover the $50,000 proceeds from Richard’s life insurance. The parties could not produce Richard’s application at trial. The parties stipulated to the following facts:
“1. Grover Thomas is the father of Ronald Thomas and Richard I. Thomas, now deceased. Ronald Thomas and Richard I. Thomas are brothers.
“2. Ronald Thomas submitted an application for $50,000 life insurance on the life of Richard I. Thomas with the initial monthly premium of $16.45 on or about July 2 or 3, 1986, to Monumental General’s Kansas City, Kansas, office.
“3. Ronald Thomas was employed as an insurance agent by Monumental General Life Insurance Company on or about July 2 or 3, 1986.
“4. On July 2, 1986, Ronald Thomas signed a ‘Conditional Receipt.’
“5. No policy of life insurance was issued in 45 days nor was any policy of life insurance ever issued.
“6. After the initial payment of $16.45 no monthly insurance premiums were ever paid to Monumental General Life Insurance Company.
“7. Richard I. Thomas died on January 28, 1987.”
At the close of Grover’s case in chief at trial, Monumental moved for a directed verdict. The trial court, basing its decision upon Tripp v. The Reliable Life Insurance Co., 210 Kan. 33, 499 P.2d 1155 (1972), denied Monumental’s motion. After all the evidence was in, Monumental again moved for directed verdict and the trial court again denied the motion. The case went to the jury.
The jury returned the following verdict:
“1. Was Ronald Thomas acting within the scope and course of his authority as an insurance agent of Monumental Life Insurance Company when he took the application of Richard I. Thomas for life insurance with that company and witnessed his signature on that application? Answer yes or no: yes
“2. Did P. J. West review the application for insurance and reject it? Answer yes or no: yes
“3. Did P. J. West put the application and $16.45 in an envelope and place the envelope in Ronald Thomas’ mail slot? Answer yes or no: yes
“4. Did Richard Thomas, during his lifetime receive notice that his application for insurance had been rejected and receive a refund of the $16.45? Answer yes or no: no
“5. Was Grover Thomas the named beneficiary in the application for insurance? Answer yes or no: yes”
Based upon the jury’s verdict, the trial court entered a partial journal entry of judgment in favor of Grover and against Monumental. Monumental filed a motion to alter and amend the partial journal entry of judgment; the motion was denied. On March 21, 1991, the trial court entered a journal entry dismissing Monumental’s cross-claim against Ronald and finalizing the judgment against Monumental. Monumental appealed.
The first issue is whether Richard’s life insurance was in effect at the time of his death because of the temporary coverage provided by the conditional receipt.
Monumental argues Tripp v. The Reliable Life Insurance Co., 210 Kan. 33, should be overruled or in the alternative its application should be narrowed. Monumental further claims the cases cited in Tripp do not support our holding in that case. In Tripp, one of Reliable’s soliciting agents met with the plaintiff, Donald Eugene Tripp, who made an application for a family plan type of insurance on February 7, 1969. Tripp paid the initial premium and received a receipt. 210 Kan. at 34. The application stated in pertinent part:
“ ‘The Company shall have sixty (60) days from the date of receipt of the application at its Home Office in Webster Groves, Missouri (which is agreed to be a reasonable period) to determine the insurability of Proposed Insured on the basis on which application is made or on another basis. If the policy is not received by the undersigned(s) within that period the application will be deemed to have been declined by the Company. . . .’ ” 210 Kan. at 34.
The receipt given to Tripp provided in part:
“ ‘. . . The insurance under the policy for which application is made shall be effective on date of this receipt or the date of completion of the medical examination (if, and when required by the Company), whichever is the later date, ....
“ ‘Company shall have 60 days from date of application to consider and act upon the application. Failure of the Company to offer a policy within such 60 days shall be deemed a declination.’ ” 210 Kan. at 34.
Tripp was never contacted by Reliable within the 60-day declination period. On May 23, 1969, the company’s home office instructed its local agent to refund the premium deposit and retrieve Tripp’s receipt. 210 Kan. at 39-40. On June 1, 1969, Reliable’s agent tendered Tripp’s initial premium and requested return of the conditional receipt. Tripp’s daughter had died on May 29, 1969, 51 days after the 60-day conditional receipt expired. Tripp refused to return the receipt, claiming'coverage. He then brought suit against Reliable for his daughter’s life insurance benefits.
The trial court determined the company was estopped to deny insurance coverage and entered judgment against the company. 210 Kan. at 35. On appeal, this court held Reliable owed Tripp the life insurance proceeds despite the 60-day limit on temporary coverage found in the application and receipt. We stated:
“The only reason for failure to return the premium at the end of the sixty days would be that the company was still contemplating issuing the policy. We cannot support a rule which would permit an insurance company to make a decision on an application after the insured’s death. We conclude under the facts disclosed in this record that when an application for life insurance is made and the company receives the initial premium and issues a receipt therefor, a policy of temporary insurance is created and said policy of temporary insurance continues in effect until the insurance company declines the application, notifies the insured, and returns the premium, notwithstanding the provisions of the application and the receipt to the contrary.” 210 Kan. at 38. (Emphasis added.)
Monumental argues the dissenting and concurring opinion written by Justice Fontron and joined by Justice Fromme is better reasoned. Justice. Fontron contended the prior Kansas cases cited by the majority were not applicable to the facts presented in Tripp. He further stated no notice was required to terminate coverage because the application and receipt clearly stated the temporary coverage would not extend beyond 60 days. Justice Fontron, referring to the rule that insurance contracts are construed against the insurer, wrote:
“[T]he rule of strict construction does not relieve a tentative insurance purchaser of the obligation to read the papers which govern the transaction, nor was the rule intended to rewrite insurance contracts when they are fairly expressed and untainted by fraud.” 210 Kan. at 41-42.
In Tripp, we relied upon Waldner v. Metropolitan Life Ins. Co., 149 Kan. 287, 87 P.2d 515 (1939). Waldner involved an insured who sought to reinstate insurance coverage after it had lapsed for failure to pay a required premium. On August 31, 1934, the insured applied for reinstatement and gave a check for the premium payment to the insurance company’s agent. 149 Kan. at 290. The check was accepted without receipt and later cashed. On September 18, 1934, the home office directed its agent to demand the insured undergo a medical examination before insurance would be issued, but the demand for an examination was never communicated to the insured. The insured died on October 30, 1934. The company denied coverage and the beneficiaries brought suit.
The trial court entered judgment in favor of the plaintiffs and this court affirmed. 149 Kan. at 295. In reaching our decision we stated:
“The defendant could not indefinitely hold the application for reinstatement without disapproving it, retain the money of the insured until long after her death, and thereafter escape liability on the ground the insured had not provided satisfactory proof of insurability.” 149 Kan. at 292.
It is worth noting that in Waldner there was no written instrument with a specified expiration date. It involved an application for reinstatement after cancellation for nonpayment of premium, a clearly distinguishable fact situation from Tripp.
The Tripp opinion also relied upon the reasoning found in Harvey v. United Ins. Co., 173 Kan. 227, 245 P.2d 1185 (1958). In Harvey, the plaintiffs petition alleged the following facts. On April 6, 1949, the insured submitted an application for life insurance, along with the first monthly premium of $3.11. The insurance company never disapproved the application, and plaintiff had no knowledge as to whether a policy was issued to the insured. The insured died on June 23, 1949. Plaintiff sought, inter alia, specific performance of the insurance contract applied for by the insured. The district court overruled the defendant’s demurrer. 173 Kan. at 228-30.
On appeal, this court affirmed the district court. 173 Kan. at 235. Finding the petition stated a good cause of action, we held:
“[T]he company was bound to act upon the application one way or another within a reasonable time and the question of what was a reasonable time was for the jury . . . 173 Kan. 227, Syl. ¶ 1.
Here again, there was no specific expiration date on the application.
Finally, Tripp relied upon the reasoning of Service v. Pyramid Life Ins. Co., 201 Kan. 196, 440 P.2d 944 (1968). Unlike Waldner and Harvey, the Service case did involve a provision for the automatic declination of insurance 60 days after application. In Service, Gerald Service and his wife, Zelma, applied for life insurance from Pyramid on June 30, 1964, and paid the first premium. Gerald received a conditional receipt stating in part:
“3. That if said application is not approved and accepted by the Company within sixty (60) days from the date hereof, then insurance applied for shall not become effective, and the amount tendered shall be returned. Any delay in the return of the amount tendered shall not be construed as approval' of the application.” 201 Kan. at 211.
Gerald died on July 21, 1964, during the temporary insurance period. When Zelma questioned the company about coverage, she was told the insurance was in effect. 201 Kan. at 200. Later, however, Pyramid denied coverage and Zelma brought suit. The trial court found in favor of the plaintiff, and on appeal this court affirmed.
In Service we thoroughly discussed temporary insurance created by the conditional receipt and the reasons for insurers to offer temporary coverage. If the insurer did not offer temporary coverage upon application the applicant would have the power to revoke the offer made in his application, thereby causing the company to risk losing what it has expended for the investigation and medical examination of the applicant. By offering binding receipts, the applicant has the obligation to perform and the insurer has'the use of the premium money at the earliest possible date. 201 Kan. at 210.
Monumental claims Service has no application in the case at bar because, in Monumental’s words, “[t]he Kansas Supreme Court in Service held that Pyramid was estopped to deny the existence of life insurance coverage.” In support of this claim Monumental cites to the issues listed in the appellate briefs of Tripp.
Monumental further argues Service should not have been used for support of our decision in Tripp because Gerald Service died within the 60-day period of temporary coverage. This presents a significant distinction between the two cases even though the language in Service is broad enough to provide the rationale for Tripp. The broad language is dicta, however, because it goes beyond the controlling facts.
Monumental further argues the language of the receipt provided the temporary coverage would expire after 45 days. Thus, if the company does not offer a policy within that time limit the application is rejected and no further notice or action by the company is required. Monumental claims applying this argument gives both parties what they bargained for.
In support of its position Monumental cites several cases, including Hornaday v. Sun Life Ins. Co. of America, 597 F.2d 90 (7th Cir. 1979), in which an applicant for life insurance paid $12.16 to Sun Life in exchange for a conditional receipt for life insurance coverage. The receipt stated the temporary coverage would last for 60 days. Sun Life issued a policy, but despite several attempts, it was never delivered. The applicant died more than 40 days after the stated date of expiration of the temporary coverage. 597 F.2d at 91-92.
The court held the insurance coverage did not extend beyond the 60-day limit specified in the conditional receipt. 597 F.2d at 94. In order to receive more coverage, the insured should have paid additional premiums. The court, relying heavily upon the fact Sun Life agents had made several good faith efforts to deliver the policy and collect unpaid premiums, stated: “’[I]f the insured successfully avoids contact with the insurer, insurance coverage is in effect indefinitely regardless of the amount of consideration paid.’ ” 597 F.2d at 94 (quoting the district court).
Monumental also cites Maldonado v. First National Life Insurance Co., 79 N.M. 354, 443 P.2d 744 (1968). In Maldonado, an applicant for life insurance paid the initial month’s premium and was given a receipt. The receipt provided in part: “Company shall have 60 days from date of application to consider and act upon application. Failure of the Company to offer a policy within such 60 days shall be deemed a declination.” The applicant died about 75 days after the date of application. The court held “the failure to act within sixty days is by the terms of the receipt refusal of the application.” 79 N.M. at 354-56.
Monumental further argues that following the rule in Tripp will allow a conditional receipt of insurance to provide coverage ad infinitum with no further premium from the insured.
We have carefully considered all of the available cases, particularly Service, upon which Tripp relied. In Service, the insured died during the conditional receipt period, making it completely distinquishable from Tripp. From our consideration of all the cases, we conclude Tripp should be overruled. The conditional receipts in Tripp and in this case state clearly and unequivocally that if no insurance policy is delivered to the applicant within a specified period, there is no insurance. Thus, the contract expired by its own terms. Such does not represent a new principle of law. Most contracts have termination dates. We are mindful of the rule that contracts drafted by one of the parties should be strictly construed against the party who drafted it. Monumental drafted this contract, but because it is clear and unambiguous it requires no construction by this court. Fast v. Kahan, 206 Kan. 682, Syl. ¶ 2, 481 P.2d 958 (1971). Thus, the strict construction rule is inapplicable.
It is a cardinal rule of construction that courts will not rewrite a contract by construction if it is clear and unambiguous. See Havens v. Safeway Stores, 235 Kan. 226, 231, 678 P.2d 625 (1984). This contract falls into that category. Richard applied for a policy of life insurance. He was issued 45 days of coverage by the conditional receipt. His premium paid for the coverage. If Monumental desired to terminate the temporary coverage before the 45 days expired, it was required to notify him and return his premium. If, however, it did not so notify him, he received 45 days of insurance, but no more, with his premium used for that coverage. In this case the insured died after the coverage under the conditional receipt expired and, therefore, Monumental is not liable. We hereby overrule Tripp v. The Reliable Life Insurance Co., 210 Kan. 33, 499 P.2d 1155 (1972).
In light of the foregoing holding, we need not discuss the remaining issues.
The judgment of the district court is reversed, and this case is remanded with instructions to enter judgment for Monumental Life Insurance Co. | [
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On January 18, 1991, respondent Larry D. Ehrlich was indefinitely suspended from the practice of law. In re Ehrlitch, 248 Kan. 92, 804 P.2d 958 (1991). The court further held that the respondent would be readmitted after one year’s suspension without' petition if he established to the satisfaction of the disciplinary administrator that he had complied with the five conditions set out by the court in its opinion. 248 Kan. at 95.
The court has received a report from the disciplinary administrator’s office in which it has determined that respondent has complied with all of the court’s conditions.
It Is Therefore Ordered that Larry D. Ehrlich be reinstated to the practice of law effective January 18, 1992.
It Is Further Ordered that the costs of this proceeding be assessed to the respondent and that this order be published in the official Kansas Reports. | [
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The opinion of the court was delivered by
McFarland, J.:
James E. Richmond appeals his jury trial convictions of aggravated kidnapping (K.S.A. 21-3421); aggravated robbery (K.S.A. 21-3427); aggravated burglary (K.S.A. 1991 Supp. 21-3716); burglary (K.S.A. 1991 Supp. 21-3715); misdemeanor theft (K.S.A. 21-3701); battery (K.S.A. 21-3412); and two counts of rape (K.S.A. 21-3502).
Victim P.K. testified she returned to her Sedgwick County residence at about 10:15 a.m. the morning of January 22, 1990, after attending an exercise class and running some errands. She observed an unfamiliar automobile parked in front of her home. Upon opening the door to her residence, P.K. saw her vacuum cleaner sitting in the hallway although it had not been there when she had left the house that morning. She entered the great room where a black man rushed at her and hit her with his fist, knocking her to the floor. She later identified defendant as her assailant. Defendant forced her to walk to her bedroom, picked her up, and threw her on the bed. He raped her and then walked her into the bathroom and back to the bed. After pushing P.K. back on the bed, defendant tied her hands and feet with nylon stockings he had removed from a dresser. He then left the room for what seemed to the victim a long period of time. When he returned, defendant untied the victim’s feet and raped her again. She was retied. Defendant held some type of metal weapon to the victim’s throat and took a gold necklace from her neck. Then he jerked the telephone wire from the wall and threatened to return and kill P.K. if she reported the crime. After defendant left, the victim was able to get free of her bonds and run to a church from which the police were summoned. Approximately one hour elapsed between the victim’s arrival home and the call to the police^
P.K.’s daughter lived next door to P.K. Her residence was burglarized the same morning and a microwave was taken. These occurrences are the basis of the burglary and theft convictions.
Additional facts will be stated as necessary for the discussion of particular issues.
AGGRAVATED KIDNAPPING
At trial, defendant moved to dismiss the aggravated kidnapping charge on the ground the movement of the victim was merely incidental to the rapes. The motion was denied. Defendant contends the denial of his motion was error.
K.S.A. 21-3420 defines kidnapping as follows:
“Kidnapping is the taking or confining of any person, accomplished by force, threat or deception, with the intent to hold such person:
(a) For ransom, or as a shield or hostage; or
(b) To facilitate flight or the commission of any crime; or
(c) To inflict bodily injury or to terrorize the victim or another; or
(d) To interfere with the performance of any governmental or political function.”
Aggravated kidnapping, K.S.A. 21-3421, “is kidnapping, as defined in section 21-3420, when bodily harm is inflicted upon the person kidnapped.”
The complaint/information charged that the victim was taken or confined with the intent to facilitate the commission of rape, aggravated robbery, or aggravated burglary. The instructions used the same language. Thus, the facilitation of flight provision of K.S.A. 21-3420(b) is not involved in the issue herein.
The leading case on what is required to be proven to establish the facilitation of the commission of any crime provision of K.S.A. 21-3420(b) is State v. Buggs, 219 Kan. 203, 547 P.2d 720 (1976). In Buggs, the defendant Ruggs and codefendant Perry confronted a woman and her son as they left the Dairy Queen where they both worked. The woman was carrying the day’s receipts in her purse. The defendants forced the victims to return to the store and took the money from the purse. While in the store, Perry held what was believed to be a gun aimed at the son while Ruggs raped the woman at knifepoint.
The claim was made in Buggs that the movement and confinement of the two individuals was only incidental to the robbery and did not constitute the separate offense of aggravated kidnapping. We held:
“Our kidnapping statute, K.S.A. 21-3420, requires no particular distance of removal, nor any particular time or place of confinement. Under that statute it is the fact, not the distance, of a taking (or the fact, not the time or place, of confinement) that supplies a necessary element of kidnapping.” Syl. ¶ 7.
“Under K.S.A. 21-3420 a taking or confining is a kidnapping if its purpose is to ‘facilitate’ the commission of any crime, even if the crime facilitated be a less serious crime such as robbery or rape.” Syl. ¶ 8.
“The word ‘facilitate’ in K.S.A. 21-3420 means something more than just to make more convenient. A taking or confining, in order to be said to ‘facilitate’ a crime, must have some significant bearing on making the commission of the crime ‘easier.’ ” Syl. ¶ 9.
“If a taking or confining is alleged to have been done to facilitate the commission of another crime, to be kidnapping the resulting movement or confinement:
(a) Must not be slight, inconsequential and merely incidental to the other crime;
(b) Must not be of a kind inherent in the nature of the other crime; and
(c) Must have some significance independent of the other crime in that it makes the other crime substantially easier of commission or substantially lessens the risk of detection.” Syl. ¶ 10.
In the case before us, P.K. arrived home during the burglary thereof. She was forced from the great room, through the living room and a hallway into a bedroom, raped, tied up, raped again, and retied. The tying up of the victim aided the defendant by incapacitating her while he searched through her house and gave him time to remove any items he desired to take. The burglary of the daughter’s residence and the theft of the microwave oven therefrom may well have occurred during this interim period. The defendant, from repeated questions and remarks to the victim, was concerned about the fact the victim had seen his automobile and also about whether any other person might be coming to the house. The removal of the victim from near the entrance to the home to a distant bedroom lessened detection of the crime by anyone arriving at the residence. A pillow was placed on the victim’s face while she was tied to keep her from seeing her assailant. Defendant searched the jacket the victim was wearing while she was tied. Also, the necklace the victim was wearing was removed while she was tied. The victim’s hands were tied throughout the second rape. Thus, this confinement of the victim facilitated the commission of the respective crimes.
We have no hesitancy in concluding the three-pronged test enunciated in Buggs has been satisfied herein and that this issue has no merit.
MULTIPLE RAPE CONVICTIONS
The defendant next argues that the two rapes are related so closely in time and circumstance that only one offense was committed.
In State v. Dorsey, 224 Kan. 152, Syl. ¶ 8, 578 P.2d 261 (1978), the court said:
“It is a generally accepted principle of law that the state may not split a single offense into separate parts. Where there is a single wrongful act it generally will not furnish the basis for more than one criminal prosecution.”
Dorsey is a four to three decision which reversed two of three attempted rape convictions and one of two sodomy convictions on the basis that the charges “grew out of one incident, with one victim under a single set of circumstances.” 224 Kan. at 154. In Dorsey as in the case before us, the time frame was approximately an hour involving a single victim. Whereas the propriety of the result reached in Dorsey is questionable, the case may be distinguished. In Dorsey the victim was confined and almost continuously subjected to sexual assault. In the case before us, there were clearly two separate incidents. The victim here was raped and then tied up while the defendant left the room to continue his search of the home. How long he was absent is unknown. The victim testified the period seemed like two hours, which is an impossibility due to the time frame involved. The exaggeration of time is understandable given the victim’s terror in her helpless condition, but the time involved establishes a clear and substantial break in the events. When defendant returned, he untied the victim’s feet and raped her again. We conclude the two convictions of rape are not multiplicitous.
BATTERY
For his next issue, defendant argues his battery conviction cannot stand as it is multiplicitous with the aggravated kidnapping and rape convictions. This same multiplicity argument was made at trial and was overruled on the basis that the defendant’s striking of the victim in their initial confrontation in the great room preceded the acts constituting the kidnapping and rapes. We agree. The victim’s arrival caught the defendant in the victim’s residence in the midst of a burglary. When she entered the room where the defendant was, he rushed at her and knocked her down with his fist. He then forced her to walk to the bedroom. This blow was an act independent of the kidnapping and rapes and not necessary for their commission.
The facts herein are distinguishable from those in State v. Lassley, 218 Kan. 758, 545 P.2d 383 (1976), wherein the victim was threatened with harm from defendant’s knife if she resisted the rape or did not move where directed in the kidnapping. The conviction of aggravated assault based upon the same threats was held to be multiplicitous as the threats were used to satisfy the force elements of the other two crimes.
We find this issue to be without merit.
AGGRAVATED BURGLARY
The complaint/information and jury instructions charged that defendant entered P.K.’s residence or remained therein with the intent to commit aggravated kidnapping, rape, or theft.
For his next issue, defendant contends his aggravated burglary conviction must be reversed because there was insufficient evidence that he entered P.K.’s residence with the intent to commit two (aggravated kidnapping and rape) of the three alternatively stated crimes.
In support of this contention, defendant directs our attention to State v. Garcia, 243 Kan. 662, Syl. ¶ 6, 763 P.2d 585 (1988), which states:
“A general verdict of guilty must be set aside if the jury was instructed that it could rely on any of two or more independent grounds, and one of those grounds is insufficient.”
In Garcia, defendant was convicted of aiding and abetting felony murder and burglary. The victim was found shot to death near his pickup truck in the yard of his residence. The burglary was charged as being of the farmhouse or pickup truck. The convictions were reversed on the ground there was no evidence that the pickup truck had been entered or had been intended to be entered.
Defendant’s reliance on Garcia is misplaced. Defendant’s intent at the time of entry into the residence is not the sole question. He was charged with entering into or remaining within the residence to commit (alternatively) the three charged felonies. From the facts herein, the most likely scenario is that the entry was made with the intent to commit a theft and that the owner’s return was a surprise. But, there was ample evidence that defendant remained on the premises with the intent to commit the aggravated kidnapping and rapes. Accordingly, the jury could have found the requisite intent to commit each of the three alternatively charged crimes. We find no merit in this issue.
INSUFFICIENCY OF THE EVIDENCE
For his final issue, defendant contends the evidence identifying him as the perpetrator of the rapes, aggravated robbery, burglary, and theft was insufficient. He concedes the identification evidence as to the aggravated kidnapping, aggravated burglary, and battery was sufficient.
When the sufficiency of the evidence is challenged, the standard of review on appeal is whether, after review of all the evidence, viewed in the light most favorable to the prosecution, the appellate court is convinced that a rational factfinder could have found the defendant guilty beyond a reasonable doubt. State v. Graham, 247 Kan. 388, 398, 799 P.2d 1003 (1990).
Defendant argues that because P.K. only saw his face while the two were in the great room of her residence there was insufficient evidence of identity on the other crimes. Also, he points out that an expert testified that certain Negroid hairs found on P.K.’s clothing and bed covers were not from defendant.
Evidence supporting the defendant being the perpetrator of the challenged crimes may be summarized as follows. Defendant forced P.K. to walk to the bedroom; her assailant then threw her on the bed and raped her. There was no break or gap in the time sequence. Although a pillow had been placed on her head, P.K. saw the rapist’s shirtsleeves, which she testified were made of the same plaid fabric as the shirt defendant wore in the great room. P.K. was holding her coin purse when she entered her home. This remained clutched in her hand until it was forcibly removed while she was on the bed. She heard the assailant going through her credit cards and identification documents. A fingerprint identified as defendant’s was found on one of these cards. During the second rape, Vaseline was used as a lubricant. Fingerprints belonging to defendant were found on the tube of Vaseline as well as on a knife found in the bedroom. The jury could have concluded the knife was the metal weapon used at the time P.K.’s necklace was removed.
Additionally, P.K.’s assailant talked to her throughout the events. She testified the voice was that of defendant. P.K. did not testify to hearing any sounds that were consistent with a second man being present — no conversations, footsteps, etc.
As far as the crimes occurring at the daughter’s next-door residence, both residences were entered by kicking in a door, leaving a tennis shoe imprint on each. The two residences are located close to each other and attached together by a breezeway. The daughter left her home at 8:00 a.m. on the morning in question and returned at 10:45 a.m. The premises were burglarized in the interim. P.K.’s residence was entered that same morning, with the burglary thereof being in progress when P. K. returned home at 10:15 a.m. The evidence that defendant committed the burglary and theft at the daughter’s residence is circumstantial. However, the circumstantial evidence is strong. That two residences, connected by a breezeway, could be the subjects of unrelated burglaries in the narrow time frame herein with identical circumstances of entry is so unlikely as to be unrealistic. We have long held that a conviction of even the gravest offense may be sustained by circumstantial evidence. State v. Hupp, 248, Kan. 644, Syl. ¶ 5, 809 P.2d 1207 (1991).
A review of all the evidence, when viewed in the light most favorable to the prosecution, convinces us that a rational factfinder could have found the defendant was the perpetrator of all crimes of which he was convicted and thus guilty beyond a reasonable doubt.
The judgment is affirmed. | [
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The opinion of the court was delivered by
McFarland, J.:
This is an action by the operator of a dairy farm against defendant National Farmers Organization, Inc., (NFO) seeking damages for an alleged breach of a milk marketing agreement and breach of fiduciary duty. The trial court granted a directed verdict on the fiduciary duty claim and the jury awarded $20,902.40 on the breach of contract claim. NFO appeals from the judgment against it and the dairyman cross-appeals from the entry of the directed verdict.
Reinhard Simon is the operator of a family partnership 300 cow dairy operation situated in Sedgwick County known as the Four Star Dairy. Simon has been in the dairy business since 1952 and has sold milk directly to manufacturers and processers and indirectly through marketing agreements. In February 1989, Simon entered into an exclusive marketing agreement with NFO which contained no references to price. Simon testified NFO's agent Norb Connor promised Simon would receive blend price plus 40 cents a hundredweight less certain marketing expenses. Simon terminated the agreement in July 1989 because he did not receive what he believed was the agreed-upon price for his milk.
In August 1989, Simon entered into a new marketing agreement with NFO which, again, did not contain an express guarantee of price. Simon testified he was orally promised, by Connor, that he would receive the blend price plus 20 cents a hundredweight less certain marketing expenses. The agreement was effective September 1, 1989.
Some discussion of blend price is appropriate. Although an oversimplification, the following explanation is adequate for the issues herein. Under federal regulation raw milk is classified into three quality categories, classes one, two, and three. Class one milk is for bottled milk; class two milk is for cottage cheese and ice cream; and class three milk is for the manufacture of cheese. The United States is divided into, geographical milk producing regions. The federal market administrator analyzes all milk sales in each region on a monthly basis and on the fifteenth of the following month publishes the uniform blend price for the particular area’s month in question, which price is essentially an average of milk prices paid within the region and month involved. Raw milk is sold by the hundredweight (cwt), and this is the unit involved in the blend price. For example, the blend price for the region involved herein in September 1989 was $14.03 cwt.
Simon’s testimony illustrates the difficult production and marketing problems facing America’s dairymen. Simon’s 300 cow herd requires approximately eight hours to milk and this is done twice a day. Simon has storage facilities for two days’ production. He does not have the option of storing his product until the best price can be obtained. Every two days his milk has to be transported and sold. The highly perishable nature and liquid consistency of milk greatly restrict the geographical area in which milk can be profitably marketed.
Simon and four other producers market their milk together as their combined production fills the milk truck owned by one of the fiye, and the truck owner transports all the milk. Every two days’ production leaves the respective dairyman’s farm together and has to be delivered to a joint customer. If they are not operating under a marketing agreement, the little consortium of five must find its own market and deliver the milk thereto. If operating under a marketing agreement, the agent finds the market and advises the truck owner where to deliver the milk. But, in either case, the procedure is relentless and inexorable — every two days the milk has to be delivered and sold. Further complicating the situation is that within the geographical area where it is economically feasible to deliver the milk,-there are relativély few buyers of large quantities of raw milk.
Two of the factors which prompted Simon to sign with NFO are that: (1) he would be paid more frequently than in direct sales; and (2) NFO had a trust fund which would enable him to be paid even if the purchaser failed to pay for the milk. This latter feature was particularly important as Simon had lost two days’ production after cancellation of the first NFO contract because the buyer had defaulted.
For the months of September 1989 through March 1990, Simon did not receive the blend price or 20 cent premium. However, what he actually received was within a dollar of the blend price. In April 1990 the price received was over two dollars short of the blend price, and the price received for the first part of May 1990 was roughly four dollars less than the blend price. Connor advised Simon NFO had lost its market, and he would terminate the agreement without the 30-day notification of termination set forth in the agreement if Simon desired. Simon did so terminate and began selling his milk directly to Bordens in Tulsa. For the remainder of 1990, Simon received prices in excess of the blend price.
On July 27, 1990, Simon filed the action herein seeking damages on two theories: (1) breach of contract for not paying the agreed blend price plus 20 cents cwt; and (2) breach of fiduciary duty to obtain the highest price for Simon’s milk. By trial time, the parties had stipulated Simon’s damages to be $20,902.40, so we do not concern ourselves with how damages were computed.
At the close of Simon’s case, NFO moved for a directed verdict as to all claims. This was taken under advisement until the close of all the evidence. The trial court granted the motion as to the claim of breach of fiduciary duty only. The claim of breach of contract was submitted to the jury, which found in favor of Simon. NFO appeals from the jury award, and Simon cross-appeals from the entry of directed verdict.
NFO’S APPEAL
For its first issue on appeal, NFO contends the trial court erred in admitting, over its objection, evidence of the alleged oral agreement to. pay Simon a guaranteed price of the blend price plus 20 cents cwt. NFO argues the contract was complete and unambiguous; hence, introduction of additional oral terms violated the parol evidence rule.
When a contract is complete, unambiguous, and free from uncertainty, parol evidence of prior or contemporaneous agreements or understandings tending to vary the terms of the contract evidenced by the writing is inadmissible. First National Bank of Hutchinson v. Kaiser, 222 Kan. 274, 564 P.2d 493 (1977).
Whether an instrument is ambiguous is a matter of law to be decided by the court. As a general rule, if the language of a written instrument is clear and can be carried out as written, there is no room for rules of construction. Godfrey v. Chandley, 248 Kan. 975, Syl. ¶ 2, 811 P.2d 1248 (1991).
Regardless of the construction of a written contract made by the trial court, on appeal a contract may be construed and its legal effect determined by an appellate court. To be ambiguous, a contract must contain provisions or language of doubtful or conflicting meaning, as gleaned from a natural and reasonable interpretation of its language. Ambiguity in a written contract does not appear until the application of pertinent rules of interpretation to the face of the instrument leaves it generally uncertain which one of two or more meanings is the proper meaning. Farm Bureau Mut. Ins. Co. v. Old Hickory Cas. Ins. Co., 248 Kan. 657, Syl. §§ 1, 2, 810 P.2d 283 (1991).
With these rules in mind, let us review the contract in question, which provides in pertinent part:
“1. In accordance with my membership agreement with National Farmers Organization (hereinafter NFO) and pursuant to the terms and conditions hereof, I hereby authorize NFO to act for me as my exclusive agent to negotiate and enter into contracts for the sale of all milk or dairy products produced or controlled by me, wherever located, except milk consumed on my farm.
“2. I authorize NFO to require any purchaser of my milk or dairy products to pay the entire amount due for those products which NFO sells for me, and to assign such amount on my behalf, to the NFO Members Dairy Custodial Account, an Iowa Trust (hereinafter Trust) .... I also authorize the Trust to borrow money as necessary and to mortgage, pledge, assign and deliver any property of the Trust as security for these loans, including accounts receivable, contract rights and the proceeds of contracts which are created by NFO’s sale of my milk or dairy products.
“3. I authorize the Trust, before remitting the net proceeds to me, to make repayment of loans, including interest, to reblend, if necessary, and to deduct one percent (1%) of the total proceeds of the sale of milk or dairy products sold by NFO for me as a check-off to NFO, my proportionate share of such necessary marketing and Trust expenses as the NFO National Board of Directors determines shall be paid by producers .... I further authorize (a) deduction of unpaid annual dues, if any, in accordance with NFO policy and (b) payment and use of any interest income earned on the balance maintained by the Trust as determined by the NFO National Board of Directors.
“7. No NFO representative is authorized to alter or add to the terms of this agreement except in writing approved by the Director of the NFO Dairy Department. NFO’s waiver of breach of any one condition of this agreement with me or with any other producer does not constitute a waiver of a subsequent breach of that condition or of a breach of other conditions.”
The NFO is a nonprofit cooperative. Marketing agreements from NFO are available only to its members. Becoming a member of NFO entails the payment of a $75 annual fee, which occurred herein.
In overruling NFO’s motion in limine to exclude evidence of the alleged oral agreement relative to a guaranteed price, the trial court stated, in pertinent part:
“[W]e have been arguing whether or not this will vary, alter where this stands under allowing evidence in not in violation of the parol evidence rule or not allowing evidence in because of the parol evidence rule. . . .
“[T]he court has come to the conclusion that what plaintiff is asking for, and what the defendant is trying to prohibit, is not something that would contradict, alter, or vary the terms of this particular agreement.
“But actually explains the agreement, and the understanding between the parties. ...
“[T]here is a wide distinction between an attempt to contradict the terms of [a] written instrument and to explain the circumstances and conditions under which it was executed and delivered.
“It has regularly been held where [a] contract is incomplete or silent in any particular, parol evidence is admissible.
“So to show the actual agreement between the parties. This is not limited to cases where there is ambiguity. It is not that it’s totally silent on this. But in the Souder case [Souder v. Tri-County Refrigeration Co., 190 Kan. 207, 373 P.2d 155 (1962)], there is a cite on page 212, where I think the Court [had a] very similar situation.
“Where it states on page 212, ruling of parol evidence to contradict, alter, or vary the terms of written instruments is not violated when such evidence does not contradict but explains or supplements in different or incomplete matters contained in the instruments.
“When it tends to show the relation of the parties and circumstances under which the instruments were executed.
“So I will overrule the motion in limine on part one and two. And allow the evidence to come in in the case over the objection of defense counsel, and his motion in limine.”
We do not agree with the trial court’s rationale. The contract, as written, is a straightforward marketing agreement designating NFO as the exclusive agent for the marketing of Simon’s milk. The nature of the relationship being established is not ambiguous or incomplete. The alleged oral agreement making NFO a guarantor of a particular price would greatly alter that relationship and add a whole new dimension thereto. Clearly, the contract can be carried out as written. A price guarantee is not an essential omitted part of an agency agreement for the marketing of milk. Additionally, there is no ambiguity in the agreement requiring parol evidence to ascertain which of two or more meanings wás intended.
We conclude that the trial court erred in holding that evidence of the alleged oral agreement was outside of and not barred by the parol evidence rule. Inasmuch as Simon’s entire claim of breach of contract is based upon the alleged oral agreement, the judgment .against NFO must be reversed.
NFO’s other issue on appeal is that the trial court erred in denying its motion for a directed verdict on the breach of contract claim. The motion was premised on paragraph 7 of the contract, which provides in pertinent part:
“No NFO representative is authorized to alter or add to the terms of this agreement except in writing approved by the Director of the NFO Dairy Department.”
NFO argues that this provision rendered any oral promise by Connor, the NFO representative, invalid and unenforceable. In view of the result reached on NFO’s first issue, we need not determine this issue.
SIMON’S CROSS-APPEAL
For the first issue of his cross-appeal, Simon contends the trial court erred in directing a verdict on his breach of fiduciary duty claim. Breach of contract and breach of fiduciary duty were presented as alternative theories of recovery for the same $20,902.40 stipulated damages.
The breach of fiduciary duty theory was, prior to trial, limited to whether or not NFO obtained the best price available for Simon’s milk. During arguments at trial, this claim broadened out to include the position that a breach of fiduciary duty occurred, additionally, when NFO lost its primary market for the sale of Simon’s milk in the spring of 1990 and did not inform Simon promptly so he could free himself of the marketing agreement and seek his own market. As will be recalled from the earlier statement of facts provided herein, Simon was let out of his contract in May 1990 without complying with the 30-day notice requirement because of the lost better market. After the better market was lost, the milk went to a cheese manufacturing plant which normally buys a lower grade of milk at substantially lower prices.
The trial court directed a verdict, pursuant to K.S.A. 1991 Supp. 60-250, on the breach of fiduciary duty claim on the basis that there was insufficient evidence thereon to submit it to a jury.
In Turner v. Halliburton Co., 240 Kan. 1, Syl. ¶ 1, 722 P.2d 1106 (1986), we set forth the following rules relative to motions for directed verdicts:
“K.S.A. 60-250 allows a litigant to move for a directed verdict, and for judgment notwithstanding the verdict. In ruling on a motion for directed verdict pursuant to K.S.A. 60-250, the court is required to resolve all facts and inferences reasonably to be drawn from the evidence in favor of the party against whom the ruling is sought and where reasonable minds could reach different conclusions based on the evidence the motion must be denied and the matter submitted to the jury. This rule must also be applied when appellate review is sought on a motion for directed verdict. The same test is applicable to a motion for judgment notwithstanding the verdict.”
Simon cites the following statement from George v. BolinWilliams, Realtors, 2 Kan. App. 2d 385, 387, 580 P.2d 1357 (1978), in support of his position:
“ ‘It is well settled that “the relation existing between a principal and agent is a fiduciary one demanding conditions of trust and confidence.” [Citations omitted.] “[I]n all transactions concerning and affecting the subject matter of his agency, it is the duty of the agent to act with the utmost good faith and loyalty for the furtherance and advancement of the interests of his principal. ...” [Citation omitted.] The agent must give the principal the benefit of all his knowledge and skill and cannot withhold or conceal in formation from the principal.’ ’’ (Quoting Sanders v. Park Towne, Ltd., 2 Kan. App. 2d 313, 317, 578 P.2d 1131, rev. denied 225 Kan. 845 [1978].)
We have no quarrel with this statement as to the duty of a fiduciary. The problem in this case lies with the sufficiency of the evidence that a fiduciary duty was breached. In his brief in support of his cross-appeal, Simon cites to us only one piece of evidence to support his claim — that he received $13.96 cwt after being released from the marketing agreement when he sold his milk directly as opposed to receiving $9.50 cwt on NFO’s last sale of his milk. These are both May 1990 sales figures. Is this enough to present a submissible case to the jury on this claim? We believe not. Simon’s own testimony was that after the NFO agreement was terminated, he sold his milk directly to Bordens in Tulsa for the $13.96 cwt figure. He also testified this market was not available to NFO as Bordens purchased milk exclusively from producers and through a cooperative in competition with NFO. Nowhere in the record is there evidence that NFO failed to seek the best available market for Simon’s milk while it served as his agent. In fact, Simon in his own testimony does not even express such an opinion let alone state facts supporting such a conclusion.
Turning to the aspect of the claim relating to the contention that NFO should have notified Simon earlier as to the loss of the good market for the milk, no evidence was presented that the failure to so notify breached any industry standard or, in any way, fell below a milk market agent’s duty of performance. The jury would have had no yardstick or guidelines with which to determine whether or not NFO breached its duty in this regard.
Applying the rules relative to a motion for directed verdict previously set forth herein, we find no error or abuse of discretion in the trial court’s entry of a directed verdict on the breach of fiduciary duty claim.
Simon’s final claim of error is that the trial court erred in denying his requested instruction on “ostensible or apparent authority and ratification. ” This issue involves the breach of contract claim and Norb Connor’s authority to bind NFO notwithstanding paragraph 7 of the marketing agreement. We did not determine the legal effect of paragraph 7 as we reversed the judgment against NFO on the basis of the parol évidence rule. Under the circumstances herein, wé need not determine this issue.
The judgment against NFO on the breach of contract claim is reversed. The entry of the directed verdict on the breach of fiduciary duty claim is affirmed. | [
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The opinion of the court was delivered by
Six, J.:
This is a probation revocation, first-impression case. We are reviewing (1) a ruling that criminal charges used as a basis for probation revocation must be resolved prior to a probation revocation proceeding, and (2) the trial court’s refusal to admit laboratory test results under K.S.A. 1990 Supp. 22-3716(2).
The State of Kansas filed a motion to revoke the probation of Cathy S. Yura, alleging Yura had violated two conditions of her probation by providing alcohol to minors and testing positive for marijuana use. The trial court refused to consider the State’s evidence and dismissed the motion to revoke probation.
Our jurisdiction is under K.S.A. 22-3602(b)(3). The State has appealed on a question reserved.
We reverse and remand.
Facts
Yura pled guilty to one count of possession of marijuana in violation of K.S.A. 1990 Supp. 65-4127b(a)(3). She was placed on probation for two years. General probation conditions required Yura to obey all federal, state, municipal, and county laws and ordinances and not to possess, use, or traffic in controlled substances. A special condition also prohibited Yura from possessing or consuming any controlled substance. Yura was required to submit to blood/urine tests upon request of the court services officer.
The State filed a motion to revoke probation, alleging positive urine tests showing cannabinoids (marijuana). The motion also alleged that Yura had provided beer to minors, a new charge upon which she had been arrested.
A court services officer requested a full drug screen. An initial urine test was positive for cannabinoids; consequently, a second urine test was requested. The second urine sample was collected at a hospital in Wellington, Kansas, and sent to a laboratory for testing. The second urine test result also was positive for cannabinoids.
Yura moved to strike the revocation allegation of providing beer to minors. She informed the court that criminal charges on that ground were set for a jury trial at a later date. Yura asserted that probation revocation on the basis of a new crime was premature before conviction of that crime. Yura contended that by proceeding with the revocation hearing she would be denied her right to a jury trial and a mere accusation prior to conviction was an inappropriate ground upon which to revoke probation.
The State responded, informing the court that the jury trial had been postponed due to a busy court calendar. The State asserted that a conviction was only one way to prove a probation violation. Another method would be for the State to introduce sufficient evidence for the court to find that Yura had violated the law.
Rulings of the Trial Court
The trial court granted Yura’s motion to strike the providing beer to minors allegation, reasoning that an action to revoke probation is inappropriate and premature when the alleged crime providing the basis for the revocation proceeding is set for a jury trial.
The State proceeded to present evidence based on positive urine tests for cannabinoids. The court services officer testified that a urine sample was sent to a laboratory for testing. She identified a laboratory report she had received as a correct copy of the test result.
The State attempted to introduce the laboratory test result under K.S.A. 1990 Supp. 22-3716. The State’s exhibit consisted of the affidavit of Donald W. Long, Director of Toxicology at Roche Biomedical Laboratories. In his affidavit Long averred that qualified personnel had performed a gas chromatograph mass spectrometry test on the numbered urine sample (assigned to Yura) and that the result was positive for cannabinoids. The laboratory report and Long’s vitae were attached to the affidavit. Long was not present to testify.
Yura objected to the exhibit. She asserted that the affidavit was hearsay. She also argued that admission of the affidavit would violate her right to confront witnesses against her.
The State responded that the urinalysis was conducted in St. Joseph, Missouri, and that it was impractical to bring someone from St. Joseph to testify every time a laboratory report reflected a positive result. (The laboratory report states the test was conducted in Kansas City, Missouri:) The State suggests that limited funding for such testing is the reason the legislature enacted K.S.A. 1990 Supp. 22-3716(2), which allows written statements in probation revocation hearings. The State asked the trial court to review the exhibit. The trial court refused to admit the exhibit on the grounds the exhibit would deny Yura’s right to confront witnesses against her.
The State then proffered the testimony of Sandra Hodgson, the person at the hospital who handled Yura’s urine specimen. The proffer indicated that Hodgson would testify that she observed Yura provide the specimen, took it directly from Yura, had Yura initial it, packaged the sample, made sure it was not tampered with, and delivered the sample to a courier who transported it to the Roche Biomedical Laboratories.
Probation Revocation Prior to Trial
The State contends the trial court erred in striking the allegation that Yura violated her probation by violating the law, i.e., by committing the new crime of providing beer to minors. Because a probation-violation may be proved by the lesser preponderance of the evidence standard, rather than beyond a reasonable doubt, the State argues there is no need to wait for conviction. The State expresses its interest in putting probation violators in jail as soon as possible due to their history of criminal activity.
' Yura emphasizes that no Kansas appellate cases hold that probation may be revoked for an alleged commission of a crime before the probationer has been tried for the new offense. She declares that the trial court did not abuse its discretion in granting her motion to strike.
In Morrissey v. Brewer, 408 U.S. 471, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972), the United States Supreme Court set forth the minimum due process requirements in revoking parole. The Court reasoned that revocation of parole is not part of criminal prosecution and, thus, the full panoply of rights due in a criminal prosecution'is not applicable to parole revocation. 408 U.S. at 480.
The Supreme Court extended the minimum requirements of due process in Morrissey to probation revocation proceedings in Gagnon v. Scarpelli, 411 U.S. 778, 786, 36 L. Ed. 2d 656, 93 S. Ct. 1756 (1973).
We have held that K.S.A. 1990 Supp. 22-3716 governs revocation of probation proceedings and satisfies the requirements of Gagnon. State v. Rasler, 216 Kan. 292, 294-95, 532 P.2d 1077 (1975).
K.S.A. 1990 Supp. 22-3716 provides that the defendant may be arrested for a probation violation at any time during probation. Upon arrest the defendant shall be brought before the trial court without unnecessary delay for a hearing on the violation. The State bears the burden of establishing the violation by a preponderance of the evidence. Rasler, 216 Kan. at 295.
In Raster, we reasoned that under K.S.A. 22-3716, probation could be revoked based upon commission of another crime even if the defendant was never charged with the crime or was charged, but later acquitted. 216 Kan. at 295.
In State v. Woods, 215 Kan. 295, 524 P.2d 221 (1974), Woods was convicted of first-degree robbery and placed on probation. While on probation, Woods was convicted of selling marijuana. Proceedings were commenced to revoke his probation. The trial court revoked probation while his appeal from the marijuana conviction was pending. Woods asserted error in revoking his probation on the basis of a state law violation that was on appeal. Woods pointed out that the trial court, in revoking his probation, took judicial notice of the files and record of conviction and did not conduct an independent investigation of the marijuana conviction. We rejected Woods’ argument, reasoning that the jury verdict of guilty was sufficient to sustain a finding that Woods was not a law-abiding citizen. 215 Kan. at 296.
Woods cited Standlee v. Smith, 83 Wash. 2d 405, 518 P.2d 721 (1974), which affirmed an order revoking Standlee’s parole because of an assault committed by Standlee while he was on parole. The parole revocation hearing was conducted after Standlee was acquitted of the assault charge. The hearing officer concluded Standlee was in fact the assailant under the lesser standard of proof of the preponderance of the evidence and revoked Standlee’s parole. Standlee appealed, contending the doc trine of collateral estoppel, as a part of the 5th Amendment guarantee against double jeopardy, prevented the parole board from relitigating the issue of his guilt of the assault. The Washington Supreme Court affirmed the parole revocation, reasoning that collateral estoppel did not apply because the burden of proof at a parole revocation hearing is less than the burden of proof in a criminal prosecution. 83 Wash, at 409.
Yura advances the argument made by Standlee. The argument is inapplicable because Yura’s probation revocation hearing occurred prior to trial of the new criminal charge. (We were informed during oral argument that Yura vyas acquitted on the charge of providing beer to minors.)
Yura relies on Standlee v. Rhay, 403 F. Supp. 1247 (E.D. Wash. 1975), in which the court granted Standlee’s writ of habeas corpus. However, the 9th Circuit Court of Appeals reversed the district court and agreed with the Washington Supreme Court that collateral estoppel does not bar a parole revocation hearing after a criminal acquittal. Standlee v. Rhay, 557 F.2d 1303, 1307 (9th Cir. 1977).
Yura also relies on People v. Grayson, 58 Ill. 2d 260, 319 N.E.2d 43 (1974). While on probation Grayson was tried and acquitted of armed robbery. Following his acquittal, a revocation hearing was held and his probation was revoked. The Illinois Supreme Court reversed, holding that Grayson’s acquittal collaterally estopped the State from considering the armed robbery at a revocation hearing. 58 Ill. 2d at 265. Grayson appears to express a minority view. See Annot., Acquittal in Criminal Proceeding as Precluding Revocation of Probation on Same Charge, 76 A.L.R.3d 564.
Yura also argues that Grady v. Corbin, 495 U.S. 508, 109 L. Ed. 2d 548, 110 S. Ct. 2084 (1990), overrules the decisions in 76 A.L.R.3d 564 which permit revocation of probation after an acquittal on the same charge. Yura’s reliance on Grady is misplaced. Grady involved successive criminal prosecutions for the same conduct. Grady does not apply because revocation of probation is not part of the criminal prosecution. Gagnon, 411 U.S. at 662.
The State relies on State v. Jameson, 112 Ariz. 315, 541 P.2d 912 (1975), 76 A.L.R.3d 56. Jameson pled guilty to grand theft and was placed on probation. A petition to revoke probation was filed, alleging, in part, that Jameson had failed to remain a law-abiding citizen. At the revocation hearing, the superior court continued the proceeding pending disposition of the related criminal charge. The criminal charge was later dismissed, which constituted an acquittal. The superior court found that Jameson was not a law-abiding citizen and revoked his probation. The Arizona Supreme Court reasoned that the doctrine of collateral estoppel does not preclude relitigating the issue of the criminal charge at a probation revocation hearing following a dismissal constituting an acquittal. The probation revocation hearing is not a second prosecution for the same offense. In addition, the Arizona Supreme Court disapproved the practice of deferring probation revocation hearings until after adjudication of guilt or innocence on a criminal charge when both proceedings are based on the same facts. 112 Ariz. at 318.
The United States Supreme Court in Black v. Romano, 471 U.S. 606, 85 L. Ed. 2d 636, 105 S. Ct. 2254 (1985), reviewed a factual scenario involving a revocation hearing held before the trial of the criminal charge that provides the basis of the motion to revoke probation.
Romano pled guilty to two counts of transferring and selling a controlled substance. The trial court placed Romano on probation. While on probation, Romano was charged with a felony. After the charge was filed, the trial court (that had sentenced Romano on the controlled substances charge) held a probation revocation hearing. Several witnesses gave testimony at the hearing indicating Romano had run over a pedestrian and driven away. The trial court found that Romano had violated his probation conditions by leaving the scene of an accident, revoked probation, and ordered execution of the previously imposed sentence. The State later filed an amended information reducing the felony charge to the misdemeanor of reckless and careless driving. Romano was convicted of the reduced charges. Romano argued that the decision to revoke probation was arbitrary and contrary to due process because the alleged felony offense was unrelated to his prior conviction. The Supreme Court disagreed, stating the violation of probation was not an innocuous violation of the conditions of his probation, but resulted from a finding that Romano had committed a felony involving injury to another person. The Court noted that its conclusion was not affected by the fact that the charges were reduced to a misdemeanor after the revocation proceeding. 471 U.S. at 616. Although the exact issue in the case at bar was not raised, the United States Supreme Court found no error in the probation revocation occurring before resolution of the pending criminal charge.
In State v. Wahlert, 379 N.W.2d 10 (Iowa 1985), Wahlert pled guilty to first-degree robbery and terrorism. Wahlert was placed on probation. He was arrested later and charged with second-degree burglary. Wahlert moved to continue the resulting probation revocation hearing until after final disposition of the criminal trial. His motion was denied. At the revocation hearing, the State presented several witnesses, including a person who had participated in the burglary. Wahlert did not testify. The trial court revoked Wahlert’s probation. Wahlert was sentenced on the original conviction. Thereafter, the State dismissed the pending burglary charge.
On appeal, Wahlert asserted that it was a violation of fundamental fairness and due process and against public policy for the trial court to deny his motion for a continuance of the revocation hearing until after the disposition of the criminal charge. Wahlert argued that holding the revocation hearing before resolution of the pending criminal trial created an unreasonable tension between his Fifth Amendment right to remain silent and the danger that his testimony in the revocation hearing might later be used to convict him. Wahlert requested a rule requiring the State to either hold the revocation hearing after the criminal trial or provide him “use immunity” barring use of his revocation hearing testimony at any later prosecution for the pending charge. The Wahlert court declined, reasoning that to cause a defendant to make a strategic choice between conflicting constitutional rights is not unconstitutional. Therefore, disposition of the criminal prosecution prior to a probation revocation hearing is not constitutionally mandated. The Wahlert court declared: (1) There is no reason to interfere with the trial court’s prompt determination as to whether the goal of rehabilitation is being met through probation; (2) society has an interest in prompt resolution of probation violations because the defendant may pose a danger if left at liberty; and (3) judicial restraint must be exercised because the legislature has the expertise to deal with public policy concerns. We find the rationale of Wahlert persuasive.
“Probation from serving a sentence is an act of grace by the sentencing judge and is granted as a privilege not as a matter of right.” State v. Starbuck, 239 Kan. 132, 133, 715 P.2d 1291 (1986).
In the case at bar, the trial court granted Yura’s motion to strike based on the commission of a new crime, stating: “I think it’s inappropriate to . . . bring any action to revoke someone’s probation when the matter is pending before the Court in another case.”
The trial court’s analysis was in error. The decision to postpone the revocation proceeding until after trial of the criminal charge that provides the basis for the motion to revoke probation should be left to the sound discretion of the trial court. It was not inappropriate for the State to file its motion for revocation before resolution of the pending criminal charge.
K.S.A. 1990 Supp. 22-3716(2) — Written Statements Under Oath and the Hearsay Rule — Right of Confrontation
The State asserts that: (1) The trial court erred in refusing to admit the laboratory test and affidavit under K.S.A. 1990 Supp. 22-3716(2); (2) the affiant’s out-of-state status provided a sufficient reason to use an affidavit; (3) K.S.A. 1990 Supp. 22-3716(2) is constitutional and does not violate Yura’s right to confront witnesses against her; and (4) Yura’s opportunity to cross-examine the court services officer and the laboratory technician, satisfies Yura’s right to confront witnesses against her.
Yura counters the State by rephrasing the issue as whether the trial court abused its discretion in refusing to admit the affidavit in question. Yura points out that K.S.A. 1990 Supp. 22-3716(2) states: “Relevant written statements made under oath may be admitted and considered by the court.” (Emphasis added.) Yura contends her right to cross-examine the court services officer and the laboratory technician would not enable her to challenge the accuracy of the test results or the affiant’s credibility. She asserts there was no abuse of discretion.
K.S.A. 1990 Supp. 60-460(b) provides that affidavits, to the extent admissible by the statutes of this State, are an exception to the inadmissibility of hearsay. Because relevant written statements made under oath are admissible under K.S.A. 1990 Supp. 22-3716(2) in probation revocation hearings, such statements are a K.S.A. 1990 Supp. 60-460(b) exception to the inadmissibility of hearsay. The trial court is vested with discretion in admitting such statements under K.S.A. 1990 Supp. 22-3716(2).
Morrissey v. Brewer, 408 U.S. 471, 489, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972), held that the minimum due process requirements in parole revocation proceedings include “the right to confront and cross-examine adverse witnesses (unless the hearing officer specifically finds good cause for not allowing confrontation).” Morrissey emphasized:
“[T]here is no thought to equate this second stage of parole revocation to a criminal prosecution in any sense. It is a narrow inquiry; the process should be flexible .enough to consider evidence including letters, affidavits, and other material that would not be admissible in an adversary criminal trial.” 408 U.S. at 489.
Morrissey provides that affidavits may be admitted for good cause shown without violating the probationer’s right to confront witnesses.
In United States v. Bell, 785 F.2d 640 (8th Cir. 1986), Bell had been placed on a two-year probation. The government petitioned for revocation of Bell’s probation. The petition cited three instances in which urine samples taken from Bell tested positive for THC, indicating Bell was using marijuana. The petition also stated that Bell had been arrested for driving while intoxicated, possession of marijuana, and possession of narcotics paraphernalia. The revocation hearing was held before the district court. (Bell had not been brought to trial at the time of the hearing or at the time the opinion was released.) The government presented the testimony of two witnesses: the initial probation officer, who had explained the conditions of probation to Bell, and a second probation officer, Arlo Lindsey. Through Lindsey, the government introduced reports from the laboratory that analyzed Bell’s urine sample and police reports of Bell’s arrest. At the close of the hearing, Bell’s probation was revoked.
Bell appealed, arguing that the admission of the urinalysis and police reports violated his right to confront and cross-examine witnesses against him. The 8th Circuit cited Morrissey and Gag- non as authorizing the use of affidavits. The Bell court stated that in a probation revocation proceeding the trial court must balance the probationer’s right to confront an adverse witness against the grounds asserted by the government for not requiring confrontation. 785 F.2d at 642. Bell listed two factors to be evaluated in examining the. government’s basis for dispensing with confrontation: (1) the explanation the government offers of why confrontation is undesirable or impractical, and (2) the reliability of the evidence which the government offers in place of live testimony. 785 F.2d at 643. The laboratory reports in Bell were determined to bear substantial indicia of reliability. They were regular reports of a company in the business of conducting such tests, and the company expected its clients to act on the basis of the reports. The Bell court concluded there was good cause shown to avoid the difficulty and expense of bringing the chemists who had performed the test from California to Arkansas to testify. The court stated: “In our experience, that sort of formal testimony rarely leads to any admissions helpful to the party challenging the evidence.” 785 F.2d at 643. See United States v. Penn, 721 F.2d 762, 766 (11th Cir. 1983).
In the case at bar, the trial court refused to admit the laboratory report consisting of the affidavit and its attachments. The trial court construed K.S.A. 1990 Supp. 22-3716(2) too narrowly.
We hold that K.S.A. 1990 Supp. 22-3716(2) authorizes admission of affidavits constituting relevant written statements made under oath stating the results of a laboratory test. The admission of such an affidavit from an out-of-state chemist does not violate the probationer’s right to confront and cross-examine witnesses. Such an affidavit bears substantial indicia of reliability. Cross-examination of laboratory personnel rarely leads to any admissions helpful to the party challenging the evidence. Bell, 785 F.2d at 643.
The trial court did not consider the reliability of the affidavit and laboratory test. We direct the trial court upon remand to utilize the two-factor test announced in Bell in resolving the admissibility of the affidavit and laboratory test.
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The opinion of the court was delivered by
Lockett, J.:
This appeal has been before the court on two prior occasions. Scott Chisholm appeals from his conviction of two counts of aggravated incest, K.S.A. 21-3603. The first appeal, State v. Chisholm, 243 Kan. 270, 755 P.2d 547 (1988) (Chisholm I), challenged the State’s use of closed-circuit television for testimony of the child-victim witness pursuant to K.S.A. 22-3434. Chisholm claimed the statutory procedure violated his Sixth Amendment right to confront the witnesses against him. This court affirmed the trial court, finding the procedure constitutional. The United States Supreme Court granted Chisholm’s petition for writ of certiorari and subsequently vacated our judgment and remanded to this court for further consideration in light of Coy v. Iowa, 487 U.S. 1012, 101 L. Ed. 2d 857, 108 S. Ct. 2798 (1988), a case decided after Chisholm I. Chisholm v. Kansas, 488 U.S. 962, 102 L. Ed. 2d 523, 109 S. Ct. 486 (1988). Upon reconsideration, this court remanded the matter to the trial court for an examination of the record in light of the Supreme Court’s decision in Coy v. Iowa and our decision in State v. Eaton, 244 Kan. 370, 769 P.2d 1157 (1989). State v. Chisholm, 245 Kan. 145, 777 P.2d 753 (1989) {Chisholm II). On remand, the trial judge held a non-evidentiary hearing, reviewed the record, and concluded he was satisfied the child witness was traumatized by the presence of the defendant. The trial court found there was clear and convincing evidence that to have required the child to testify in open court in the presence of the defendant would have prevented the child from reasonably communicating to the jury and effectively rendered the child unavailable to testify. The trial judge based his ruling on Coy and Maryland v. Craig, 497 U.S. _, 111 L. Ed. 2d 666, 110 S. Ct. 3157 (1990), a case decided after this court’s decision in Chisholm II. Chisholm appeals, claiming the trial court erred in finding: (1) that there was clear and convincing evidence that the child victim would have been unable to effectively communicate if required to confront the defendant in open court; and (2) that it was therefore necessary to present her testimony on closed-circuit television, thereby denying his right of confrontation provided by the Sixth Amendment to the United States Constitution.
In Chisholm I, Chisholm was accused of molesting his eight-year-old stepdaughter. A videotape of the stepdaughter’s statement to police and SRS workers was shown at the preliminary hearing. The stepdaughter also testified at the preliminary hearing and was subjected to cross-examination in the presence of Chisholm.
Before Chisholm’s trial, the State, noting that the stepdaughter was less than 13 years old and had expressed fear of Chisholm, moved that the stepdaughter’s testimony be taken by closed-circuit television pursuant to K.S.A. 22-3434. The statute states in part:
“Videotape of testimony of child victim admissible in certain cases; limitations; objections, restrictions, (a) On motion of the attorney for any party to a criminal proceeding in which a child less than 13 years of age is alleged to be a victim of the crime, the court may order that the testimony of the child be taken:
“(1) In a room other than the courtroom and be televised by closed-circuit equipment in the courtroom to be viewed by the court and the finder of fact in the proceeding; . . .
“(b) At the taking of testimony under this section:
“(1) Only the attorneys for the defendant, the state and the child, any person whose presence would contribute to the welfare and well being of the child and persons necessary to operate the recording or closed-circuit equipment may be present in the room with the child during the child’s testimony;
“(2) only the attorneys may question the child;
“(3) the persons operating the recording or closed-circuit equipment shall be confined to an adjacent room or behind a screen or mirror that permits them to see and hear the child during the child’s testimony but does not permit the child to see or hear them; and
“(4) the court shall permit the defendant to observe and hear the testimony of the child in person, but shall ensure that the child cannot hear or see the defendant.
“(c) If the testimony of a child is taken as provided by this section, the child shall not be compelled to testify in court during the proceeding.”
At the hearing on the State’s motion, the district court noted the statute makes the decision discretionary with the court and held that, although the statute did not set out the criteria to be applied in the exercise of discretion, the statute’s non-mandatory language required the State to show why its request should be granted.
The State contended one of the purposes of K.S.A. 22-3434 is to save a child victim from multiple confrontations with an alleged abuser. The State compared the coherent, detailed testimony of the stepdaughter on the videotape when she was interviewed by a social worker to her frightened and uncommunicative testimony when she was examined in the courtroom in Chisholm’s presence during the preliminary examination. The State argued the chances of her giving coherent testimony at trial if face-to-face with Chisholm were “dim.” The trial court had previously viewed the stepdaughter’s demeanor on the videotape and her demeanor when confronted with Chisholm during the preliminary examination and determined that because the contrast in her ability to testify was so great it was appropriate for her to testify on closed-circuit television to avoid confronting Chisholm again.
At trial, the stepdaughter testified in a special room in which she could not see Chisholm or the cameraman in a booth. Her direct testimony was subject to contemporaneous objection by defense counsel, who was in the room with her. The judge could communicate with the attorneys by means of a connected cable. The judge and jury watched the testimony on television screens. Chisholm privately conferred with his attorney in a separate room before the attorney began his cross-examination of the stepdaughter. The jury found Chisholm guilty of two counts of aggravated incest, and Chisholm was given a suspended sentence and placed on four years’ probation under intensive supervision.
Chisholm appealed his conviction, arguing K.S.A. 22-3434 violated the Sixth Amendment of the United States Constitution by not requiring the trial court to make a specific finding that the use of a closed-circuit television was necessary for the child witness to testify. He argued the State’s contention that his stepdaughter was so frightened of him as to be “almost unable to give any testimony” was insufficient to meet its burden of showing the necessity of testimony by way of closed-circuit television. We held Chisholm’s argument, that K.S.A. 22-3434 required that the witness be unavailable, was contrary to our previous decision in State v. Johnson, 240 Kan. 326, 729 P.2d 1169 (1986), cert. denied 481 U.S. 1071 (1987). We noted the statute preserved the defendant’s and the jury’s freedom to fully observe the witness’ testimony and demeanor; therefore, cross-examination was fully available. We found the only indicia of reliability missing was that the complaining witness was not forced to look at the defendant and the court as she gave her testimony. We noted while face-to-face confrontation may encourage truthfulness in an adult, the legislature had found that, in certain instances, the truth would be more likely obtained from a child under the age of 13 if the child were spared the trauma of facing an overpowering and angry adult. We unanimously affirmed Chisholm’s convictions of two counts of aggravated incest in violation of K.S.A. 21-3603. We determined that Chisholm’s Sixth Amendment right to confront his accuser was not violated when the trial court allowed the child witness to testify via closed-circuit television pursuant to K.S.A. 22-3434. Chisholm I, 243 Kan. 270.
Subsequent to our June 3, 1988, decision in Chisholm I, the United States Supreme Court on June 29, 1988, ruled on a similar issue in Coy v. Iowa, 487 U.S. 1012, and reached the opposite conclusion. In Coy, a divided United States Supreme Court held that a screen placed between child witnesses and a defendant charged with lascivious acts with children violated the defendant’s Sixth Amendment right of face-to-face confrontation.
During Coy’s trial a screen between the accused and the child witnesses had been erected pursuant to Iowa Code § 910A.14 (1987), which allowed the trial court discretion in ordering use of the screen. Coy could observe the children through the screen, but the children could not see him. As in Chisholm I, the witnesses were subjected to foil cross-examination under oath and their demeanor was observed by Coy, his attorney, the court, and the jury. In a departure from previous rulings focusing on the reliability of testimony, the United States Supreme Court held the Sixth Amendment’s Confrontation Clause protected ■Coy’s right of literal face-to-face confrontation with the witnesses against him.
Justice Scalia, writing for a divided majority, stated the United States Supreme Court had never doubted that the Confrontation Clause guarantees the defendant a face-to-face meeting with the witnesses appearing before the trier of fact. He noted the Sixth Amendment’s guarantee of face-to-face encounter between witness and accused serves ends related both to appearances and to reality. Justice Scalia asserted a witness may feel quite differently when the witness is required to repeat the story while looking at the person whom the witness would harm greatly by distorting or mistaking the facts. He acknowledged that face-to-face presence could upset the truthful rape victim or abused child but it could also confound and undo the false accuser, or reveal the child coached by a malevolent adult. He observed, “It is a truism that constitutional protections have cost.” 487 U.S. at 1020..
The State argued that Coy’s confrontation interest was outweighed by the necessity of protecting victims of sexual abuse. Justice Scalia answered, “It is true that we have in the past indicated that rights conferred by the Confrontation Clause are not absolute, and may give way to other important interests.” 487 U.S. at 1020. He explained that the rights referred to in those cases, however, were not the rights narrowly and explicitly set forth in the clause, but rather rights that are, or were asserted to be, reasonably implicit — namely, the right to cross-examine, the right to exclude out-of-court statements, and the asserted right to face-to-face confrontation at some point in the proceedings other than the trial itself. 487 U.S. at 1020.
Justice Scalia observed the State of Iowa maintained that the necessity to allow the child to testify via closed-circuit television is established by the statute, which creates a legislatively imposed presumption of trauma. He noted other United States Supreme Court decisions suggest, however, that even as to exceptions from the normal implications of the Confrontation Clause something more than the type of generalized finding underlying such a statute is needed when the exception is not “firmly . . . rooted in our jurisprudence.” 487 U.S. at 1021. Justice Scalia stated the exception created by the Iowa statute, which became law in 1985, could hardly be viewed as “firmly rooted.” He concluded since there had been no individualized findings that these particular witnesses needed special protection, the judgment could not be sustained by any conceivable exception. 487 U.S. at 1021.
Justice O’Connor, with whom Justice White concurred, noted that confrontation rights are not absolute but may give way in an appropriate case to other competing interests so as to permit the use of certain procedural devices designed to shield a child witness from the trauma of courtroom testimony. Justice O’Con-nor observed it was not novel to recognize that a defendant’s right physically to face those who testify against the defendant, even if located at the core of the Confrontation Clause, is not absolute. Justice O’Connor declared she would permit the use of a particular trial procedure that called for something other than face-to-face confrontation if that procedure was necessary to further an important public policy. 487 U.S. at 1024-25.
After the Coy decision was filed, Chisholm petitioned for certiorari and his case was accepted for review by the United States Supreme Court. On November 28, 1988, the United States Supreme Court vacated our decision in Chisholm I and remanded the matter to this court for further consideration in light of Coy. Chisholm v. Kansas, 488 U.S. 962.
After Coy was decided and prior to the United States Supreme Court’s remand of Chisholm, we heard the case of State v. Eaton, 244 Kan. 370. We were required by the United States Supreme Court’s decision in Coy to reverse Eaton’s convictions of aggravated criminal sodomy and indecent liberties with a child because the seven-year-old witness’ testimony had been given via closed-circuit television pursuant to K.S.A. 22-3434 under circumstances somewhat similar to this case. We noted the child’s testimony via closed-circuit television offended Coy because the trial court had not made the required finding of necessity, and we remanded the matter for a new trial.
In Eaton, we denied the defendant’s challenge to the constitutionality of the statute, noting although K.S.A. 22-3434 may be apparently void on its face, the intent of the legislature could be constitutionally carried out by judicially reading into the statute the individualized determination required by Coy v. Iowa, 487 U.S. 1012, 101 L. Ed. 2d 857, 108 S. Ct. 2798 (1988). For K.S.A. 22-3434 to meet the requirements of Coy, a trial judge is first required to make an individualized finding that there is clear and convincing evidence that to require a child to testify in open court will so traumatize the child as to prevent the child from reasonably communicating to the jury or render the child unavailable to testify. We stated that in order to justify the use of closed-circuit television under 22-3434 the court must consider the factors set out in State v. Kuone, 243 Kan. 218, 757 P.2d 289 (1988), and other factors relevant to whether the face-to-face confrontation between the child victim and the accused would or could cause psychological injury to the child.
In Kuone, we examined the legislature’s child-victim witness exception to the rule against admission of hearsay evidence. Kuone dealt with a mentally ill and retarded 11-year-old whose out-of-court statements were introduced by the State pursuant to K.S.A. 1990 Supp. 60-460(dd), which stated:
“Evidence of a statement which is made other than by a witness while testifying at the hearing, offered to prove the truth of the matter stated, is hearsay evidence and inadmissible except:
“(dd) Actions involving children. In a criminal proceeding ... , if:
“(1) The child is alleged to be a victim of the crime or offense . . . ; and
“(2) the trial judge finds, after a hearing on the matter, that the child is disqualified or unavailable as a witness, the statement is apparently reliable and the child was not induced to make the statement falsely by use of threats or promises.
“If a statement is admitted pursuant to this subsection in a trial to a jury, the trial judge shall instruct the jury that it is for the jury to determine the weight and credit to be given the statement and that, in making the determination, it shall consider the age and maturity of the child, the nature of the statement, the circumstances under which the statement was made, any possible threats or promises that might have been made to the child to obtain the statement and any other relevant factor.”
We acknowledged Eaton’s right of confrontation but determined that certain factors could be used to determine whether a child witness is “unavailable,” under the 60-460(dd) exception to the hearsay rule, because of psychological trauma or disability. The factors to be considered are: (1) the probability of psychological injury as a result of testifying; (2) the degree of anticipated injury; (3) the expected duration of the injury; and (4) whether the expected psychological injury is substantially greater than the reaction of the average victim of a rape, kidnapping, or other violent act. Other factors may also be relevant. State v. Eaton, 244 Kan. 370, 384, 769 P.2d 1157 (1989). We held in Kuone there was sufficient evidence of “unavailability” under these fac1 tors to allow the child’s prior statements. 243 Kan. at 229. In Eaton, we found the lack of individualized findings to be error and reversed the convictions. 244 Kan. at 385-86.
As in Coy and Eaton, the trial judge in Chisholm I was unaware that the United States Supreme Court decision in Coy would subsequently place restrictions on the use of the statute and did not make individualized findings that the trauma to the child witness outweighed the defendant’s right of confrontation. In contrast to the trial judges in Coy and Eaton, the trial judge in Chisholm I gave individualized attention to the trauma the stepdaughter had evidenced when confronted with the defendant at his preliminary examination. The trial court also expressed concern that the rights of the defendant not be limited without a showing by the State that the needs of the child outweighed the defendant’s right to face-to-face confrontation.
We were unable to determine from the record on appeal whether there was sufficient evidence for the trial court to make the individualized finding that trauma to the child outweighed Chisholm’s right to confrontation as required by Coy and allowed the child victim to testify via closed-circuit television. We remanded the matter to the trial judge for an examination of the record to determine whether the State’s public policy interest in protecting child victims of sex crimes is sufficient to justify an exception to Chisholm’s right of confrontation. We stated that if after examining the record in light of Coy and Eaton the trial court is able to make the necessary individualized findings as to the probability, degree, and duration of psychological injury to the child, Chisholm’s convictions would stand. If there was not sufficient evidence in the record for the trial judge to make the necessary individualized findings to deny the defendant his right of face-to-face confrontation, Chisholm’s convictions would be vacated and the defendant granted a new trial. 245 Kan. at 152-53.
On March 22, 1990, at the conclusion of the hearing on remand, the trial judge observed that, since the Kansas Supreme Court had everything in the record that was available to him, he was to rely on his own independent recollections of the observations he made at the various hearings and motions and determine from those observations whether there was sufficient evidence for him to make the individualized findings required by the various cited decisions.
On June 27, 1990, subsequent to our remand in Chisholm II and the trial judge’s hearing on remand but prior to the trial court’s decision, the United States Supreme Court decided Maryland v. Craig, 497 U.S. _, 111 L. Ed. 2d 666, 110 S. Ct. 3157 (1990). In Craig, the United States Supreme Court held that, if a State makes an adequate showing of necessity, the State’s interest in protecting child witnesses from the trauma of testifying in a child abuse case is sufficiently important to justify the use of a special procedure that permits a child witness in such cases to testify at trial against a defendant in the absence of face-to-face confrontation with the defendant. It stated that the requisite finding of necessity must be a case-specific one; the trial court must hear evidence and determine whether use of the one-way closed-circuit television procedure is necessary to protect the welfare of the particular child witness who seeks to testify. It stated, in addition, the trial court must also find that the child witness would be traumatized, not by the courtroom generally, but by the presence of the defendant. The trial court must further find that the emotional distress suffered by the child witness in the presence of the defendant is more than de minimis, i.e., more than “mere nervousness or excitement or some reluctance to testify.” The Court determined it need not decide the minimum showing of emotional trauma required for use of the special procedure because the Maryland statute which required a determination that the child witness will suffer “serious emotional distress such that the child cannot reasonably communicate” clearly suffices to meet constitutional standards. Ill L. Ed. 2d at 685.
The Craig Court concluded that where necessary to protect a child witness from trauma that would be caused by testifying in the physical presence of the defendant, at least where such trauma would impair the child’s ability to communicate, the Confrontation Clause does not prohibit use of a procedure that, despite the absence of face-to-face confrontation, ensures the reliability of the evidence by subjecting it to rigorous adversarial testing and thereby preserves the essence of effective confrontation. Because there was no dispute that the child witnesses in Craig testified under oath, were subject to full cross-examination, and were able to be observed by the judge, jury, and defendant as they testified, the Court concluded that a proper finding of necessity had been made and the admission of such testimony was consonant with the Confrontation Clause. Ill L. Ed. 2d at 686.
When deciding if the use of closed-circuit television testimony violated Chisholm’s right of confrontation, the trial judge used the less restrictive standard of Coy and Craig, rather than the standard we set based on Coy in Eaton. The trial court first noted that no evidence or testimony was presented at the earlier proceedings by any psychologist or mental health expert as to the distress or trauma which might be suffered by the child-victim witness. The trial judge then observed that the transcript of the preliminary hearing revealed there had been testimony by the mother of the victim which indicated the victim was afraid of the defendant and the victim feared the defendant would harm the victim’s mother. The trial judge stated he personally observed the child was experiencing a great deal of distress and trauma and was not able to communicate when she was called by defendant’s counsel to testify at the preliminary hearing. The trial judge asserted, “Yet when questioned by the same attorney at trial, out of the presence of the Defendant, the child witness was able to present her testimony appropriately while still displaying some nervousness and some reluctance to testify.” The trial judge stated he was satisfied that the child witness was being traumatized by the presence of the defendant and not merely displaying some nervousness because she was in the courtroom.
The trial court asserted that the videotape presented at the preliminary hearing demonstrated the child was able and even willing to testify about the events for which the defendant was charged. The videotape showed that while the child was obviously embarrassed by having to describe what occurred, she was still able to effectively communicate in a clear and coherent manner as to those matters about which she was being questioned. The judge then held that a review of the proceedings and the various transcripts established by clear and convincing evidence that to have required the child witness to testify in open court in the presence of the defendant would have prevented the child from reasonably communicating to the jury and effectively thereby rendered the child unavailable to testify.
In this appeal Chisholm argues the trial judge did not make the findings regarding the probability, degree, and duration of psychological injury to the child as required by our remand in Chisholm II in order to affirm Chisholm’s convictions. The defendant points out the trial court stated in its memorandum of decision that no evidence or testimony was presented by any psychologist or mental health expert (prior to its decision to allow closed-circuit television for the child’s testimony at trial) as to the distress or trauma which might be suffered by the child. Chisholm correctly observes that the primary basis for the court’s holding was its perception of the difference in the child’s demeanor (1) while testifying in Chisholm’s presence at the preliminary hearing; (2) as shown on the videotape introduced at the preliminary hearing; and (3) during her testimony on closed-circuit television at trial.
Chisholm points out that the child did in fact testify while confronting Chisholm at the preliminary hearing. He asserts few questions concerning the alleged sexual conduct were asked the child at the preliminary hearing; at trial, the child stated she was unable to remember in response to a number of questions regarding the alleged incidents; and her answer to at least one question was more specific at the preliminary hearing in the presence of the defendant than at trial out of the presence of the defendant. Chisholm concedes a difference in the child’s demeanor at the preliminary hearing and on other occasions, but argues she was able to testify while in Chisholm’s presence and her memory lapses were not unique to the preliminary hearing. He argues that, given her ability to communicate while confronting Chisholm at the preliminary hearing, her fear that Chisholm would harm the child’s mother could not be a basis for the trial court’s conclusion that Chisholm’s presence would so traumatize the child that she would have been unable to effectively communicate if required to once again testify in his presence at trial.
Finally, Chisholm argues no evidence had been presented that the child would be psychologically harmed if required to testify in Chisholm’s presence. Chisholm recites the factors set forth in Kuone and states none of the required individualized findings as to the probability, degree, and duration of psychological injury to the child were made by the judge. He concludes there is nothing in the record showing that the child would not have been able to testily in Chisholm’s presence at trial or that the child would have been psychologically harmed if required to do so. Chisholm points out our statement in Chisholm II: “If after examining the record in light of Coy and Eaton, the trial court is able to make the necessary individualized findings as to the probability, degree, and duration of psychological injury to the child, the convictions will stand.” 245 Kan. at 152. He then notes the reasons set forth by the trial court in upholding the presentation of the child’s testimony by closed-circuit television at trial do not address such factors. Chisholm claims this is reversible trial court error.
As to defendant’s claim that the child was more explicit in one of her answers during the preliminary hearing when confronting the defendant than at the trial when testifying by closed-circuit television, the State claims the responses were different only because the questions were framed differently. As to defendant’s claim that the child was able to communicate at the preliminary hearing, the State contends appellant’s argument fails to take into account that the ability to communicate about neutral issues was not matched by any such ability in regard to questions about the alleged incestuous acts.
The State concludes the trial court had actually applied the tests required by Craig when the trial court made its initial ruling on the use of closed-circuit television in Chisholm I. The State claims that, on the basis of the remand language in Chisholm II, the test is a sufficiency of the evidence test. The State concludes Chisholm wants this court to weigh the recorded testimony, disregard the trial court’s observations of the child’s demeanor, and find there was insufficient evidence in support of the court’s decision.
The right to confrontation of a witness under the Kansas and United States Constitutions includes the right of the accused to face-to-face confrontation while a victim accuser is testifying against the accused. The fundamental right of the accused to confront the child-victim accuser in a criminal trial is not absolute and has exceptions where necessary to further an important public policy. The State’s interest in protecting child victims of sex crimes and in obtaining reliable testimony from a child witness in sexual abuse trials constitutes an important public policy sufficient to justify an exception to a defendant’s right to confrontation and has not changed since the legislature enacted K.S.A. 22-3434. A defendant in a sexual abuse trial is not denied the constitutional right to confrontation where the child-victim witness testifies via closed-circuit television, pursuant to K-S.A. 22-3434, provided the trial court (1) hears evidence and determines use of the one-way closed-circuit television procedure is necessary to protect the welfare of the particular child witness who seeks to testify; (2) finds that the child witness would be traumatized, not by the courtroom generally, but by the presence of the de7 fendant; and (3) finds that the emotional distress suffered by the child witness in the presence of the defendant is more than de minimis, i.e., mo.re than mere nervousness or excitement or spme reluctance to testify.
Did the trial court comply with the requirements of Maryland v. Craig?
1. The trial court must hear evidence and determine whether use of the one-way closed-circuit television procedure is necessary to protect the welfare of the particular child witness who seeks to testify. Here, the trial court did not “hear evidence” in the manner set out in Coy and Craig. Rut, the trial court had personally observed the child’s inability to testify when confronting the defendant face-to-face and her ability to talk about the incidents when out of the presence of the defendant. The trial court stated, “I’m satisfied that having gone through the Preliminary Hearing now and observed the video and the demeanor, that it is appropriate and reasonable that the testimony of that witness, the victim, be taken by closed circuit television and the State’s motion will be granted in that regard . . . .”
2. The trial court must find that the child ivitness would be traumatized, not by the courtroom generally, but by the presence of the defendant. The trial court státed it was satisfied that the child witness was being traumatized by the presence of the defendant and was not merely displaying some nervousness because she was in the courtroom.
3. The trial court must find that the emotional distress suffered by the child witness in the presence of the defendant is more than de minimis, i.e., more than “mere nervousness or excitement or some reluctance to testify.” The trial court found the child was not merely displaying some nervousness because she was in the courtroom. The trial court also stated, “The child witness, when called by Defendant’s counsel to testify at preliminary hearing, was observed [by the trial court] to be experiencing a great deal of distress, trauma and was not able to effectively communicate. Yet when questioned by the same attorney at trial, out of the presence of the Defendant, the child witness was able to present her testimony appropriately while still displaying some nervousness and some reluctance to testify.”
The trial court found after a review of the proceedings and the various transcripts there was clear and convincing evidence that to have required the child witness to testify in open court in the presence of the defendant would have prevented the child from reasonably communicating to the jury and effectively thereby rendered the child unavailable to testify.
The State’s public policy to protect children through the use of closed-circuit television for testimony of a child-victim witness was adopted by our legislature and codified at K.S.A. 22-3434. The various cases we have cited and the resulting decisions have required this particular case to proceed through the trial and appellate systems of the State of Kansas and the United States Supreme Court. The child is now 15 years, old. The incidents occurred more than six years ago. The trial judge had personally observed the inability of the child-victim witness to testify in the presence of Chisholm and concluded that the child could not reasonably communicate if required to testify in the presence of the defendant. If the trial court’s personal observations at the preliminary examination and at trial can substitute for the hearing of evidence of trauma to the child required by our decision in Chisholm II, the difference in the child’s demeanor when relating information about the incidents out of the presence of the defendant and the child’s demeanor when testifying in the presence of the defendant is an adequate showing by the State for the necessity of the procedure.
Though there was no specific evidentiary hearing held as required by Coy, Eaton, and Craig, a review of the record reflects all the procedural safeguards to ensure the defendant’s consti tutional right of confrontation are present. We affirm the trial court and order that Chisholm’s sentence be reinstated.
In Eaton and Chisholm I we observed that the legislature in passing K.S.A. 22-3434 presumed that the testimony of all witnesses under the age of 13 years in criminal cases may be excluded from the requirements of the Sixth Amendment Confrontation Clause. We noted the public policy underlying the passage of the statute was legitimate and compelling to ensure that the child witness would not be so traumatized by a face-to-face confrontation with the accused as to be unable to reasonably communicate the truth of the matter. Because of the United States Supreme Court’s decision in Coy, we determined in Eaton that K.S.A. 22-3434 was unconstitutional unless the trial court makes an individualized finding that the child-victim witness would suffer trauma as a result of giving in-court, face-to-face testimony. We placed the burden on the State of proving by clear and convincing evidence that a child-victim witness would suffer psychological harm as a result of a face-to-face confrontation with the accused. Because the United States Supreme Court decision in Craig no longer requires the State’s burden to be so great, we abandon the standard set out in Eaton for use of testimony by way of closed-circuit television under K.S.A. 22-3434 and adopt the standard set forth in this opinion.
Affirmed. | [
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The opinion of the court was delivered by
Abbott, J.:
Farmers Banshares of Abilene, Inc., (Farmers) filed this action on behalf of itself and a class of corporations similarly situated, seeking mandamus and injunctive relief to compel the Kansas Secretary of State (the Secretary) to refund corporate franchise taxes that had been collected from the proposed class. The trial court granted the defendant’s motion to dismiss and denied Farmers’ motions to certify the class and to impound incoming corporate franchise tax collections.
The facts are not in dispute. Farmers is a for-profit corporation organized and existing under the laws of Kansas. It is classified as a “shell holding company.”
Each domestic for-profit corporation must file an annual report with the Secretary upon forms prescribed by the Secretary. K.S.A. 1991 Supp. 17-7503(a). This form is referred to as “Form AR. ” Payment of the corporation’s franchise tax should accompany Form AR. K.S.A. 1991 Supp. 17-7503(c). The formula for calculating franchise taxes is statutory. Each corporation required to pay a franchise tax is subject to a $20 minimum or a $2,500 maximum tax. K.S.A. 17-7501(e); K.S.A. 1991 Supp. 17-7503(c).
Prior to January 1991, Form AR incorrectly instructed corporations how to calculate the corporate franchise tax. As a result, Farmers had been overpaying its corporate franchise taxes. For the 1989 tax year, Farmers’ accountants recommended that Farmers pay only the $20 minimum tax. If Farmers had followed the instructions included with Form AR, Farmers would have overpaid its corporate franchise tax by $1,622.
Farmers filed its 1989 tax year Form AR with a check for the $20 minimum tax attached. The Secretary sent written notice to Farmers that its Form AR was unacceptable and its franchise tax payment was insufficient. Farmers was instructed to submit a corrected tax return. Farmers sent the Secretary written notice that Farmers’ franchise tax was correctly calculated according to the statutory formula. The Secretary advised that unless Farmers complied with the Secretary’s directive, Farmers could face forfeiture of the corporation and financial penalties. In September 1990, a meeting was held at the Secretary’s offices. At that meeting, Farmers presented the Secretary with a detailed memorandum, explaining Farmers’ claim that Form AR contained instructions contrary to the statute. Another meeting was held in December 1990. On January 22, 1991, the Secretary sent Farmers a letter acknowledging that Farmers’ interpretation of the formula was correct. The Secretary declined to honor Farmers’ request for a refund of the franchise taxes Farmers had overpaid for the years 1985 through 1988 on the grounds that Farmers’ request was not timely. Farmers’ return for the 1989 tax year was accepted.
The letter also notified Farmers that as of January 22, 1991, a new Form AR had been promulgated to comply with the statutory formula. This form bears the legend, “Rev. 1/91 cs.” Farmers points out that in December 1990, the Secretary had promulgated a revised form, bearing the legend “Rev. 12/90 cs,” which also contained the erroneous instructions. In early January 1991, the Secretary sent out forms containing the erroneous instructions to corporations whose tax year ended December 31, 1990. At the time the Secretary promulgated the revised form in December, 1990, he was aware of the potential problem with the instructions because of his meetings and correspondence with Farmers, but had not concluded that Farmers’ position was correct. The Secretary allowed all corporations that filed a 1990 tax year return after January 22, 1991, the date the Secretary accepted Farmers’ position that the instructions on the form AR were in error, to file an amended return using the revised and now correct instructions.
On January 28, 1991, Farmers filed suit, seeking declaratory, injunctive, and refund relief. In its petition, Farmers stated it overpaid its corporate franchise tax by $1,346 in 1985, by $1,412 in 1986, by $1,478 in 1987, and by $1,623 in 1988 for a total of $5,859. Farmers also filed a motion for class certification. On February 19, 1991, the Secretary filed a motion to dismiss. On February 25, 1991, Farmers filed a motion to impound franchise tax payments.
The trial court granted the Secretary’s motion to dismiss and denied Farmers’ motions for class certification and to impound funds. Farmers timely appealed. This court granted Farmers’ motion to transfer the case from the Court of Appeals to the Supreme Court.
Farmers first argues it has a civil cause of action under chapter 60, separate and apart from the Act for Judicial Review and Civil Enforcement of Agency Actions (KJRA), K.S.A. 77-601, et seq. Thus, Farmers claims it does not have to exhaust administrative remedies.
Farmers raises a number of other issues, including the interpretation of K.S.A. 17-7508. On today’s date, this court filed its opinion in Dean v. State, 250 Kan. 417, 826 P.2d 1372 (1992) and Zarda v. State, 250 Kan. 364, 826 P.2d 1365 (1992). Both cases decide the basic issue before us, whether Farmers was required to exhaust administrative remedies and whether Farmers’ motion for class certification should have been granted.
In Dean, we held that interpretation of a statute is a necessary and inherent function of an agency in its administration or application of that statute. The agency should not be subjected to litigation in the courts until the taxpayer has exhausted administrative remedies. Agency actions are the heart of this case; Farmers is protesting the manner in which taxes were assessed. Because the forms of relief sought by Farmers are provided for in K.S.A. 77-622, Farmers’ exclusive remedy is through KJRA.
Farmers did not follow statutory procedure and, therefore, is not entitled to a refund for the years 1985-88. The trial court did not err in so holding. Farmers paid the correct tax for 1989 and 1990, and the Secretary corrected the instructions prior to Farmers’ filing suit. There is no remaining tax refund issue before this court.
The reasoning this court expressed in Dean and Zarda disposes of Farmers’ arguments concerning the trial court’s dismissal of the class action. Although we do not reach the issue, it appears Farmers also lacks standing to bring a class action because it is not a member of the class, i.e., it is not entitled to a refund; it paid the correct amount in 1989 and 1990; and the instructions were corrected before Farmers filed its suit.
Farmers’ remaining issues are considered and disposed of adversely to Farmers pursuant to Dean v. State and Zarda v. State.
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The opinion of the court was delivered by
Six, J.:
This consolidated criminal appeal arises from the operation of an alleged higher education “loan scam.” Sherman C. Edwards and Wanda J. Edwards were convicted of multiple counts of making a false writing, K.S.A. 21-3711, and of criminal solicitation, K.S.A. 21-3303, in connection with the guaranteed student loan applications of eight purported students. Sherman and Wanda were also convicted of submitting false applications on behalf of themselves. Wanda was convicted of submitting a false application under the name of Jerline Johnson, a real person who did not give Wanda permission for the use of her name. Wanda and Sherman were also convicted of submitting a false application under the name of “Ann Dawson,” who was a fictitious person.
The issues are: (1) sufficiency of the evidence; (2) whether the false information was material under K.S.A. 21-3711; (3) multiplicity — merger (whether the charge of aiding and abetting in making a false writing merged with the charge of solicitation to make a false writing); and (4) alleged factfinding errors.
The Court of Appeals in an unpublished opinion filed August 9, 1991, reversed the trial court and vacated the sentences.
The Court of Appeals reasoned that the Edwards actively recruited eight persons to apply for admission to Wichita State University (WSU) and for guaranteed student loans. The Edwards were active in helping the eight fill out forms, shepherding them through the enrollment process, and collecting their money. However, the Court of Appeals stated:
“The record is silent on whether any of the false statements made in the applications were in any way material to the question of whether the applicants would be admitted and receive aid.
“Although We have some tantalizing hints, there was no direct testimony that any of the false statements were in fact material. We do not know that the false statements made the applications any more likely to be accepted than if the truth had been stated.”
The convictions, except count 13, were reversed as to Sherman on the basis of materiality. All of Wanda’s convictions, except counts 3 and 13, also were reversed for lack of materiality. Counts 3 and 13 involved applications for Jerline Johnson (count 3), who did not give her permission for the application to be made, and for “Ann Dawson” (count 13), a fictitious person. Sherman’s conviction on count 13 was reversed because there was no evidence in the record to show how Sherman was involved in the “Ann Dawson” application. Wanda’s convictions on counts 3 and 13 were reversed because Wanda was improperly charged with making a false writing rather than the appropriate charge of forgery.
Jurisdiction is under our grant of the State’s petition for review.
The State does not seek review of the dismissal of counts 3 and 13 relating to Wanda or of count 13 as it relates to Sherman. Our opinion in State v. Rios, 246 Kan. 517, 792 P.2d 1065 (1990), controls the disposition of counts 3 and 13. We affirm the Court of Appeals in reversing counts 3 and 13. We reverse the Court of Appeals and affirm the trial court on the other counts.
Facts
The 27-count complaint/information charging Sherman and Wanda with the crimes of criminal solicitation and making false writings arose out of an alleged “student loan scam.” The Edwards, who were married, solicited and assisted eight recruits in submitting false applications for admission to WSU. They also solicited and assisted in the submission of false applications for federally guaranteed student loans in exchange for a “cut” of the loan proceeds. The Edwards were charged with one count of solicitation and one count of making a false writing for each of the eight recruits. They were also charged with making a false writing in connection with their own applications, an unauthorized application (Jerline Johnson), and that of a fictitious person (Ann Dawson).
None of the eight individuals who received student loans attended classes at any time. Each one testified, however, that at application time he or she intended to go to school but that circumstances conspired to prevent each one from attending.
The assistance Wanda and Sherman provided usually consisted of Wanda filling out and filing the necessary paperwork on behalf of the applicants. Wanda and Sherman would notify the applicants when the loan checks were received by WSU. Sherman and Wanda drove the applicants to WSU to enroll, obtain student identification cards, and receive a “rebate check” for the difference between tuition and fees and the loan amount. After receiving the rebate checks, Sherman and Wanda often provided rides to various banks so that the applicants could cash the loan checks and pay to the Edwards the “assistance” fee of $200-$300.
A secretary in the WSU housing office became suspicious. A man she identified as Sherman Edwards, at intervals throughout one afternoon, brought several individuals to the financial aid office. Edwards then accompanied the individuals to her office to pick up their student identifications. The secretary recorded the license number of the car being used to transport the applicants. She gave the car tag number to a co-worker who called the WSU police. The WSU police, joined by the Federal Bureau of Investigation and the United States Department of Education, investigated. The car was rented by Sherman. Several of the admission and loan applications contained incorrect information.
The State dismissed three counts (Nos. 1, 26, and 27) as to each defendant at the close of its case. At the conclusion of a bench trial, Sherman was found guilty of 10 counts of making a false writing and 8 counts of criminal solicitation. Wanda was convicted of 11 counts of making a false writing and 8 counts of criminal solicitation. The trial court found both defendants not guilty on four counts (Nos. 16, 17, 18, and 19).
Sufficiency of the Evidence
Sherman and Wanda contend the evidence was insufficient to convict them of the crimes charged. They reason that eight of the convictions of making a false writing should be vacated. The Edwards assert the State failed to prove actual knowledge of the false information contained in the applications of eight of the purported WSU students.
Our standard of review is whether, after a review of all the evidence, viewed in the light most favorable to the prosecution, we are convinced that a rational factfinder could have found the Edwards guilty beyond a reasonable doubt. See State v. Graham, 247 Kan. 388, 398, 799 P.2d 1003 (1990).
The crime of making a false writing is “making or drawing or causing to be made or drawn any written instrument . . . with knowledge that such writing falsely states or represents some material matter or is not what it purports to be, and with intent to defraud or induce official action.” (Emphasis added.) K.S.A. 21-3711.
Knowledge is an essential element of the offense of making a false writing that the State must prove to obtain a conviction. Knowledge means actual information that the writing falsely states or represents some material matter and is intended to defraud or induce some official action. State v. Conner, 4 Kan. App. 2d 207, 208-09, 603 P.2d 1038 (1979), rev. denied 227 Kan. 927 (1980). Speculation, opinion, or constructive notice that the writing falsely represents a material matter is not sufficient. 4 Kan. App. 2d at 209.
The State concedes there is no direct evidence that the Edwards knew the applications related to the eight counts of making a false writing contained false information. However, the State asserts that circumstantial evidence is sufficient to support the convictions.
The finder of fact in this bench trial was the district judge. The credibility of witnesses is determined by the factfinder. State v. Wade, 244 Kan. 136, 146, 766 P.2d 811 (1989).
The Edwards do not dispute that Wanda’s printing appears on four loan applications (Billy Melton, Marcetia McConico, James Earl Brown, and Sherman Woods). A documents examiner testified that a fifth application (Michael Prince) was printed by Wanda. Prince denied that the Edwards had anything to do with his application.
Count 6 charged the Edwards with submitting false writings on behalf of Billy Ray Melton. Melton’s loan application falsely stated that he was receiving welfare in the form of Aid to Dependent Children (ADC). A State Department of Social and Rehabilitation Services (SRS) investigator testified that Melton received transitional general assistance through June 1986, but never received any ADC. Melton testified that Wanda filled out the application for him because he did not know how.
Count 10 charged the Edwards with making false writings on behalf of James Earl Brown. Brown’s application falsely indicated that he was receiving ADC. The SRS investigator testified that Brown was not receiving any ADC. Knowledge of the falsity of this representation may be inferred from Brown’s own testimony. Brown stated that Wanda and Sherman told him what to write on the forms, and he also stated that he knew the information was not true and correct at the time he signed the application.
Count 8 charged the Edwards with making false writings on behalf of Marcetia McConico, whose loan application was in Wanda’s handwriting and listed McConico’s address as 1901 North Spruce in Wichita. Her actual address was 1908 North Spruce. McConico testified that Wanda helped her fill out the forms.
Count 15 charged the Edwards with making a false writing on behalf of Mary Patrick, whose application did not disclose that she was currently attending a vocational school. Patrick testified that she filled out the application herself. The only assistance Patrick acknowledged receiving from the Edwards was a ride to WSU to submit the application. Patrick’s testimony also indicated that she may have been at the Edwards’ house when she filled out the application. Patrick’s testimony was later impeached by the introduction of prior inconsistent statements that she had made to police officers. An investigator with the Department of Education testified that Patrick told him that her friend Wanda came by and said “everyone else was getting loans at W.S.U.” and that Patrick should go there. Patrick then told the officer the Edwards took her to pick up the application and helped her fill it out at their house. Patrick told the investigator that Sherman Edwards assisted her in enrolling at WSU.
Count 21 charged the Edwards with making a false writing on behalf of Evelyn Ballance, whose application falsely stated that she was receiving ADC. Ballance stated she was not receiving any assistance. Ballance denied that Wanda assisted her in filling out the application. Ballance testified that she did not have any contact with Wanda after receiving the loan check. Ballance’s testimony was also impeached by prior inconsistent statements. She told the Department of Education investigator that Wanda involved her with WSU and that Wanda had filled out Ballance’s application and informed her that either Sherman or Wanda would contact Ballance when the loan check came in and that Ballance would not be in any trouble. When Ballance picked up the check, Wahda was waiting outside the building and demanded her money. Ballance could not cash the rebate check immediately because she did not have the proper identification. Ballance told the officers that Wandá would leave notes or messages with Ballance’s sister stating that she wanted her money for assisting with the loan application.
Count 23 charged the Edwards with making a false writing on behalf of Michael Prince, whose application falsely stated: (1) he graduated from Lawrence Dunbar High School in Lubbock, Texas, and (2) the number of his dependents. Prince’s sister, Twyna Prince, indicated neither statement was true. Michael Prince denied receiving any assistance from either Wanda or Sherman in filling out and submitting the applications. Prince acknowledged in an interview with police officers that he had received some assistance from Wanda. Officer McCullough testified that when Michael was asked to tell the truth about his loan application he indicated that if he did “there were people that would find him and kill him. ” Michael then cut the interview short, left the WSU Police Station, and met the Edwards for lunch. The officers later visited with Michael at his girlfriend’s house while interviewing his girlfriend. Michael told the officers that “Wanda did it.”
Count 25 charged the Edwards with making a false writing in the applications of Sherman Woods, which falsely stated the number of his dependents and household size. Woods denied that he talked to either Wanda or Sherman about obtaining his loan or that Wanda had printed his application. He also testified that he was alone when he picked up his loan check, but a secretary in the WSU housing office identified Woods as the driver of the car rented to Sherman Edwards on the day Edwards brought several persons in to obtain student loans.
Count 12 charged the Edwards with making a false writing on behalf of Twyna Prince, whose application misrepresented her high school graduation status and the number of her dependents. Twyna admitted the information on the applications was incorrect and that her handwriting appeared on the application. However, she testified that “when it came to the questions that would guarantee me getting that loan, they [Shermán and Wanda] told me what to put there.” Brown similarly testified that the Edwards told him what information to record on the applications.
The State’s theory that the Edwards’ operation secured persons to apply for guaranteed student loans in order to profit is supported by the evidence. The Edwards’ involvement with the various applications presents circumstantial evidence that they knew that the loan applications contained false information.
The State’s loan scam theory is supported by additional evidence in the record. Walter Reed testified that he met Sherman and Wanda after others told him the Edwards could help him be admitted to WSU. He stated that Wanda told his mother and uncle that they also should apply for student loans. Reed testified that the Edwards gave him a ride to the bank. Wanda did not want to enter, stating that she was afraid she would be recognized because she had been in the bank so many times. An inspector with the Department of Education testified that his office received a complaint from Janet Ballance (deceased), Evelyn’s sister, regarding “some type of loan scam” run by the Edwards. Several of the purported students stated or implied that Sherman and Wanda either had the necessary student loan forms at their house or carried them pérsonally. Others who testified stated that they either obtained the applications from WSU themselves or that the Edwards took them to WSU to pick up the necessary forms. Lueva Jackson was a reluctant State’s witness at trial. She testified that she did not see anything out of the ordinary when she went to the Edwards’ house. However, the prosecutor’s direct examination of Jackson indicates that she told the police a radically different story. The trial judge found that Jackson told investigators she had seen Wanda filling out loan applications at the kitchen table and that Wanda and Sherman “were helping a lot of people” fill out loan applications to get a cut of the proceeds.
The totality of the circumstantial evidence of the Edwards’ knowledge of the falsity of the representations in the applications was sufficient to sustain the convictions as to counts 8 (McConico), 12 (Twyna Prince), 15 (Patrick), 21 (Ballance), 23 (Michael Prince), and 25 (Woods), in addition to counts 6 (Melton) and 10 (Brown).
K.S.A. 21-3711 — Material Matter
Sherman was convicted of count 2, making a false writing, in connection with his own loan application. Wanda was convicted of count 4, making a false writing, in connection with her loan application. The Edwards contend, with respect to counts 2 and 4, that the State failed to prove that the false representations on their own individual loan applications were material.
Sherman’s application misrepresented his address and his marital status, and Wanda’s application misrepresented her marital status and falsely stated that she was receiving ADC. The Edwards also assert that the misrepresentations concerning the receipt of ADC on the applications of Melton, Brown, and Ballance, and the misrepresentation about technical school on Patrick’s application, were not material.
Information is considered material under K.S.A. 21-3711 (making a false writing) if a reasonable person would attach importance to the information in choosing a course of action in the transaction in question. State v. Roberts-Reid, 238 Kan. 788, 789, 714 P.2d 971 (1986). Larry Rector, WSU’s director of financial aid, testified that if his office was aware of a false address “or if there was anything false on the application, the references, any information, then we would not approve [the application].” Based on Rector’s testimony, it is clear that WSU attached importance to the information listed on the applications in determining whether to approve the applications. He also testified that the social security number and the number of persons in the applicant’s household was significant and that nonattendance at class “would not be fulfilling the requirement of what the loan was made for and that would be a falsehood and they should not have received the loan.”
In our view the record supports the finding of the trial court that the misrepresentations were material.
Multiplicity — Merger
The Edwards argue that they cannot be convicted of both making a false writing and soliciting an individual to make that false writing. Their contention appears to be that, because the false writing convictions were based on the State’s theory that the Edwards aided and abetted other individuals in making false writings, any solicitation to make those false writings merged into the intended crime. The Edwards contend that all the elements of criminal solicitation are found within the crime of aiding and abetting a crime, thus making the solicitation convictions violative of the double jeopardy clause and the concept of multiplicity.
The State reasons that criminal solicitation is a separate offense from aiding and abetting the commission of a crime and that each crime involves different elements; therefore, the offenses did not merge. We agree.
In State v. Freeman, 236 Kan. 274, 280, 689 P.2d 885 (1984), we discussed the concept of multiplicity, which is “the charging of a single offense in several counts of a complaint or information.” The concern with multiplicity is that it creates the potential for multiple punishments for the same offense, which is prohibited by the double jeopardy clause of the Fifth Amendment of the United States Constitution and section 10 of the Kansas Bill of Rights. Brown v. Ohio, 432 U.S. 161, 165, 53 L. Ed. 2d 187, 97 S. Ct. 2221 (1977); Freeman, 236 Kan. at 280-81.
K.S.A. 21-3107(1) formulates the limitations upon unfair multiplicity of convictions and prosecutions. Freeman, 236 Kan. at 281.
“When the same conduct of a defendant may establish the commission of more than one crime under the laws of this state, the defendant may be prosecuted for each of such crimes. Each of such crimes may be alleged as a separate count in a single complaint, information or indictment.” K.S.A. 21-3107(1).
Under K.S.A. 21-3107(1), a prosecutor is free to charge multiplicitous crimes, but a defendant cannot be punished more than once for the same crime. 236 Kan. at 282. The Edwards’ argument necessarily assumes they are being punished more than once for the same crime.
K.S.A. 21-3303(a) provides: “Criminal solicitation is commanding, encouraging or requesting another person to commit a felony, attempt to commit a felony or aid and abet in the commission or attempted commission of a felony for the purpose of promoting or facilitating the felony.”
K.S.A. 1991 Supp. 21-3205(1) provides: “A person is criminally responsible for a crime committed by another if such person intentionally aids, abets, advises, hires, counsels or procures the other to commit the crime.”
In the case at bar, the trial judge found 21-3205(1) applied, making Sherman and Wanda criminally responsible for the false statements contained in the applications of Melton, McConico, Brown, Twyna Prince, Patrick, Ballance, Michael Prince, and Woods. The trial court stated that the Edwards were criminally responsible because both were actively involved in promoting, preparing, and submitting the applications of the purported students.
The crime of making a false writing includes “making or drawing or causing to he made or drawn” any false writing. (Emphasis added.) K.S.A. 21-3711. The evidence established that Wanda and Sherman caused false writings to he made or drawn on behalf of the purported students. The separate crime of criminal solicitation was complete when Wanda and Sherman commanded, encouraged, or requested the individuals: (1) to make false writings, or (2) to aid Wanda and Sherman in the commission of making a false writing for the purpose of promoting or facilitating the crime.
The Edwards further assert that the offenses of criminal solicitation and making a false writing were multiplicitous. They argue that they were prosecuted under the theory of aiding and abetting with respect to the making of the false writing charges. They emphasize that all of the elements of criminal solicitation were contained in the description of aiding and abetting. However, criminal solicitation as defined in K.S.A. 21-3303 contains the requirement that the offense solicited be a felony, whereas aiding and abetting covers misdemeanor offenses as well. Further, unlike criminal solicitation, aiding and abetting requires that the person “knowingly associates himself with [an] unlawful venture and participates in a way which indicates he willfully is furthering the success of the venture.” State v. Buckland, 245 Kan. 132, 140, 777 P.2d 745 (1989). Since the offenses of criminal solicitation and the theory of aiding and abetting each contained an element which was not encompassed within the other the offenses did not merge. State v. Zamora, 247 Kan. 684, 694, 803 P.2d 568 (1990). The offenses were not multiplicitous. The Edwards were not punished twice for the same crime.
Factfinding Errors
The Edwards allege the trial court’s cumulative factfinding errors establish that “substantial justice” was not done in this case. The State contends that the Edwards’ failure to mention any specific factfinding errors presents nothing for appellate review. We agree.
The Edwards do not identify any of the cumulative factfinding errors the trial court allegedly made. “ ‘An appellant has the burden of furnishing a record which affirmatively shows that prejudicial error occurred in the trial court. In the absence of such a record, we presume that the action of the trial court was proper.’ ” State v. Gonzales, 245 Kan. 691, 699, 783 P.2d 1239 (1989). No error has been shown.
We affirm the trial court’s finding that Sherman Edwards is guilty on nine counts of making a false writing and eight counts of criminal solicitation. Sherman’s conviction on count 13 of making a false writing is reversed. The trial court’s finding that Wanda Edwards is guilty of making a false writing on counts 4, 6, 8, 10, 12, 15, 21, 23, and 25 is affirmed. Wanda’s convictions on counts 3 and 13 of making a false writing are reversed. The trial court’s finding that Wanda is guilty of eight counts of criminal solicitation is affirmed.
The Court of Appeals is affirmed in part and reversed in part. The trial court is affirmed in part and reversed in part. The case is remanded to the trial court to enter an order in conformity with this opinion. | [
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The opinion of the court was delivered by
Herd, J.:
This is an action in the nature of a declaratory judgment, peremptory injunction and mandatory injunction brought by the Board of Public Utilities of Kansas City (BPU or Board), to determine whether the Board or the city of Kansas City, Kansas, has the statutory authority to determine and prescribe the manner, procedure and method of issuing and selling new construction and refunding revenue bonds of Kansas City, Kansas, pursuant to K.S.A. 13-1252 et seq. A three-judge panel of the Wyandotte District Court unanimously ruled in favor of the city. The Board appealed from that judgment. We affirmed the judgment of the trial court in an abbreviated opinion handed down December 7, 1979 (227 Kan. 1, 603 P.2d 627).
Prior to 1929, the water and light plants in Kansas City, Kansas, were under the operation and control of the governing body of the city, and more particularly the commissioner of water and lights. The 1929 legislature enacted Senate Bill No. 183 which was entitled “An act relating to municipally owned water and light plants in certain cities, and creating a board of control, construction, operation and management thereof.” L. 1929, ch. 126. This act is now K.S.A. 13-1220 - 13-1234a. Some, but not all, of the sections have been amended in the fifty years since the act was passed.
The act provides in each city of the first class, identified as having a population over 100,000, which owns and operates municipal water and electric light plants, there shall be elected a board of public utilities which shall manage, operate, maintain and control the water and light plants with authority to improve, extend or enlarge the system. K.S.A. 13-1234 abolished the office of water and light commissioner, find devolved its duties upon the Board of Public Utilities. The 1929 act provided for the issuance and sale of general obligation bonds deemed necessary by the BPU for the construction, extension or improvement of the water and electric plants. (K.S.A. 13-1231, 13-1232.) In 1941, the legislature enacted K.S.A. 13-1251 - 13-1264, providing for the issuance and sale of water and electric light plant revenue bonds in municipalities where the plants are operated by a board of public utilities. K.S.A. 13-1253 was amended in 1975 and again in 1977 to provide for the issuance of refunding revenue bonds.
The facts which give rise to this action are not in dispute. On June 16, 1977, the city of Kansas City, Kansas, upon receipt of a resolution, estimated cost, and notice of intention from its board of public utilities, approved and published notice of intent to cause to be issued $96,000,000.00 of water and electric light plant revenue bonds, pursuant to K.S.A. 10-1201 - 10-1212, and 13-1252 - 13-1264. The bonds are to be used for partial payment of a new electrical generating plant, estimated to cost $187,800,000.00. To date, $57,000,000.00 of the principal amount of the $96,000,000.00 authorized, has been issued. The first $32,000,000.00 was issued October 1, 1978; the last $25,000,000.00 was issued July 1, 1979. This controversy arises out of proceedings to issue and sell the next $32,000,000.00 of the authorized $96,000,000.00 and to refund $63,000,000.00 of bonds previously issued.
On August 13, 1979, the city commission and the BPU held a preliminary meeting. The parties discussed public sale of the bonds by competitive bid and it was agreed a financial advisor was needed. On August 27, 1979, the tentative schedule of all the acts necessary for issuance and sale of the proposed bonds by competitive bid at a public sale was circulated to the city commission and the Board. The schedule showed the action which needed to be taken by the city and the Board. Thereafter, on September 19, 1979, officials of the city and the Board met in the mayor’s office at which time the city was advised the BPU wished to have the bonds sold by negotiation. The city objected to this method of sale and adopted Resolution No. 31695 on September 26, 1979, which authorized the city attorney and the city bond counsel to prepare the proposed bond issue for public sale by competitive bid as soon as possible. The city then employed Kidder, Peabody & Co. to act as financial advisor, with whom the Board was requested to cooperate.
BPU continued to hold out for negotiating the sale of the bonds and passed Resolution No. 4462 on October 3, 1979. The resolution directed the city to issue $98,000,000.00 principal amount of water and electric light plant revenue bonds to be sold on a negotiated basis. The Board retained Stern Bros. & Co. as senior underwriters, with Stinson, Mag & Fizzell as bond counsel and the Commercial National Bank of Kansas City, Kansas, as escrow agent. The Board’s resolution directed the city to retract, rescind and nullify its resolutions regarding competitive bidding and the employment of a financial advisor. The city refused to comply.
This action was filed by the BPU on October 4, 1979, and was tried to a three-judge panel on October 23, 1979. Judgment was rendered for the city; the Board appeals. We are called upon to determine the scope of authority granted the Board of Public Utilities by K.S.A. 13-1221 et seq. The Board claims complete autonomy and the city maintains the Board is only an administrative agency with authority over the day-to-day operations of the water and electrical systems of the city. Because the powers of both the city and the Board are creatures of statute, an examination of the statutory law provides the answer.
K.S.A. 1979 Supp. 13-1221 provides authority for creation of the Board and governs its membership and election of officers. The Board’s powers and duties are set forth in K.S.A. 1979 Supp. 13-1223, which states:
“The board of public utilities shall have the exclusive control of the water plant and the electric-light plant and shall be charged with the duty of producing and supplying the city and its inhabitants with water and electric energy for domestic and industrial purposes and for public use in the city, and subject to the provisions of K.S.A. 66-131 and K.S.A. 1977 Supp. 66-104, may sell and dispose of any surplus outside of the city. It shall have power to hire and discharge all employees, agents and officers of the water and light departments and fix their compensation, and as a part of such compensation, the board may pay the cost of group hospitalization, surgical benefits, and insurance for its employees. The purchasing agent for the board shall, in conjunction with and under the authority of the board, purchase all supplies and make all contracts for services and equipment required by the board or any department thereof, and shall keep true and accurate records of all such purchases and contracts so made. The purchasing agent shall make monthly reports to the board of all purchases made or contracts entered, and for which department such were made. Except as hereinafter provided, prior to making a purchase of a commodity other than fuel or entering into a contract for supplies or services, which purchase or contract involves an expenditure of more than ten thousand dollars ($10,000), the purchasing agent shall advertise for bids thereon in a daily newspaper which shall be designated by the board. Upon a vote of four (4) members of the board authorizing the same, no advertisement for bids shall be required in the event of an emergency, and if the board consents thereto, no such advertisement shall be required for products or services requiring specialized products or skills including, but not by way of limitation, photographs, maps, books and educational supplies.
“The board may in the name of the city take and hold by purchase, gift, devise, bequest or otherwise such franchises and real or personal property either within or without the city as may be needful or convenient for the carrying out of the intended purposes for which it is established!
“It shall be the duty of the governing body of the city when requested by the board of public utilities to enact such ordinances as may be deemed necessary for the protection of the water and light plants, and to institute condemnation proceedings whenever in the judgment of the board of public utilities private property should be taken in the name of the city for water plant or electric-light plant purposes. The board of public utilities may establish all reasonable rules and regulations to protect the rights and property vested in the city and under control of the board; may issue vouchers or warrants in payment of all claims and accounts incurred by said board for the respective departments, which vouchers or warrants when approved by the board shall be authority to the city treasurer to pay and charge the same against the proper funds, and shall also have such other powers as may be necessary for the proper discharge of its duties.”
A close examination of the grant of power contained in this statute reveals it falls short of those powers normally considered inherent powers of an independent legal entity. For example, powers vested in other statutory bodies, such as a port authority created by K.S.A. 12-3401 et seq., are in sharp contrast to the powers of the Board. A port authority can sue and be sued (K.S.A. 1979 Supp. 12-3402[a]); borrow money (K.S.A. 12-3406[fc]); acquire, own, hold, sell, lease or operate real or personal property (K.S.A. 12-3406[e]); exercise the power of eminent domain (K.S.A. 12-3406[/i]); and issue revenue bonds and refunding revenue bonds (K.S.A. 12-3415 - 12-3420). Other legal entities, such as water supply and distribution districts, K.S.A. 19-3501 et seq., and industrial districts, K.S.A. 19-3801 et seq., are granted similar powers not conferred on the BPU. In addition, it is significant to note the city treasurer is the ex-officio treasurer of the Board of Public Utilities, illustrating the legislature contemplated the city having a role in financial matters of BPU.
Let us now turn to the question of which entity has authority to sell and issue revenue bonds and refunding revenue bonds, pledging the income of the Board of Public Utilities of the city of Kansas City, Kansas. K.S.A. 13-1252 - 13-1264 are applicable to municipalities with a population of more than 120,000, which own and operate a water and light plant, whether by itself or through a board of public utilities. K.S.A. 13-1252 grants revenue bonding power to certain “municipalities,” defined in K.S.A. 10-101 as “every corporation and quasi corporation empowered to issue bonds in payment of which taxes may be levied.”
Clearly, the city of Kansas City, Kansas, is the municipality referred to in the statute. The city is the municipality qualified to issue and sell revenue bonds for reconstruction, alteration, repair, improvements, extension or enlargement of the water and light plant, pursuant to K.S.A. 1979 Supp. 13-1253. The BPU, specifically created by K.S.A. 13-1221, is not included in the definition. The Board operates the water and electric plants in the name of the city to produce and supply the city and inhabitants with water and electric energy as an agency of the city, subject always to the application of a home rule charter ordinance. Case law supports this position. Hubert v. Board of Public Utilities, 162 Kan. 205, 174 P.2d 1017 (1946); Gilmore v. Kansas City, 157 Kan. 552, 142 P.2d 699 (1943); Seely v. Board of Public Utilities, 143 Kan. 965, 57 P.2d 471 (1936); State, ex rel., v. McCombs, 129 Kan. 834, 284 Pac. 618 (1930). The specific powers granted the Board by K.S.A. 1979 Supp. 13-1223 do not include the power to levy taxes. We hold a board of public utilities to be an administrative agency of the city charged with the duty of managing, operating, maintaining and controlling the water and electric light plants of the city. Such an agency, having no power to levy taxes, is neither a municipal corporation nor a quasi-municipal corporation, pursu ant to K.S.A. 10-101. The city, not the BPU, is authorized under K.S.A. 1979 Supp. 13-1253 to issue and sell revenue and refunding revenue bonds.
In the alternative, appellant contends that although bonds must be issued and sold by the city, statutory provisions vest authority in the board of public utilities to determine the amount, time, manner, methods and procedure of issuance and sale. The Board relies upon K.S.A. 13-1260 for authority, which states:
“In municipalities of the class provided for herein, if the water and light plants thereof are under the control and management of a board of public utilities as provided by law, when three-fifths of said board of public utilities shall deem it necessary and expedient that revenue bonds be issued for any of the purposes provided for herein, it shall be the duty of the governing body of such city within ten days after receiving written request from said board of public utilities to take the necessary steps for the issuance of such revenue bonds and the governing bodies of such city shall issue and sell such bonds as requested by the board of public utilities, the proceeds thereof to be delivered to the treasurer of the board of public utilities.
“That where it is necessary, as provided herein, to hold an election to submit the question of the issuing of such revenue bonds to the qualified electors of the municipality, such elections shall be held in accordance with the provisions herein and the general election laws of the state of Kansas where applicable, and the cost thereof, if held on dates other than the dates of the regular city election, or general election, shall be paid by the board of public utilities of such city.” (Emphasis provided.)
Much is made of the meaning of the phrase “such bonds as requested by the board of public utilities.” The BPU would have us read the phrase to mean the city shall issue and sell such bonds “in the manner” requested by the BPU. Without delving into semantics, we think it apparent from viewing the entire act, it is the intent of the legislature to place the ultimate debt responsibility on the governing body of the city. The title to all property remains in the city; the bonds are issued and sold in the name of the city; the city is a necessary party to sue and be sued. This makes it apparent the words “as requested” refer to the words “such bonds,” immediately preceding. Thus, a logical reading of the statute shows the sentence means the city shall issue and sell bonds the BPU requests be sold. This interpretation is consistent with K.S.A. 13-1256, which states: “Such bonds may be sold in such manner as the governing body of the municipality shall determine . . . .” The Board possesses the factual information required to determine the need for construction and ability to repay. That information is relayed to the city with a request for bonds. The city shall then exercise its governmental function within ten days, study the request and if reasonable and proper, issue and sell the bonds as requested, in the manner and at the time the governing body deems appropriate.
The final issue is whether the city has authority to issue and sell refunding revenue bonds without a request from the Board and, as a corollary, whether a majority of the Board may require the city to issue and sell refunding bonds. K.S.A. 1979 Supp. 13-1253 answers the question where it states:
“Any municipality which has issued or may hereafter issue revenue bonds under the provisions of this section may at any time deemed advisable issue and sell refunding revenue bonds to refund any previous issue or issues or part thereof which are outstanding either at or prior to their maturity.”
The legislature granted the city authority to refund at anytime it deemed refunding advisable. There are no qualifications to the grant of power. The city, in its uncontrolled discretion, is empowered to make the decision. It can neither be forced to issue nor restrained from issuing the refunding bonds. The city has sole power to prescribe the amount, time, manner, procedure and method of issuance. The statute is clear and unambiguous and needs no construction by this court.
From the foregoing, it is obvious the actions of the Board of Public Utilities were ultra vires.
The judgment of the trial court is affirmed. | [
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The opinion of the court was delivered by
Herd, J.:
This is a medical malpractice case brought by Berniece Lindquist for the wrongful death of her husband, Val A. Lindquist, against Ayerst Laboratories, Inc., manufacturer of the anesthetic Fluothane and Drs. M. Robert Knapp and Courtney Clark, the anesthesiologists who administered the anesthetic to the decedent. The trial court sustained motions for directed verdicts in favor of Clark and for Ayerst as to punitive damages. The jury returned a verdict in favor of Ayerst and Knapp. We affirm.
The controlling facts can be briefly recited. On August 13, 1969, Val A. Lindquist went to his doctor, Dr. Willard J. Smith, who diagnosed a tumor of the right testicle. The same day Lindquist was admitted to the hospital and surgical removal of the testicle was performed the following day by Dr. Smith. During the surgery, the anesthesiologist, Clark, administered a general anesthetic known as Fluothane or Halothane. Due to a staph infection in the incision, Mr. Lindquist remained in the hospital for 10 days until August 24, 1969. The pathology report on Lindquist revealed a highly malignant form of cancer. He was readmitted to the hospital on August 28, 1969, for a surgical procedure known as retroperitoneal node dissection, which was performed August 29, 1969. During this surgery, Fluothane was again used as the anesthetic, this time by Dr. Knapp. Four days after surgery, the patient developed extreme jaundice, lapsed into a coma and subsequently died on September 8, 1969, of liver failure.
The record on appeal is unclear but apparently Mrs. Lindquist’s first action, filed August 9, 1971, was dismissed without prejudice. The action was refiled on October 29, 1973 and was assigned to Judge B. Mack Bryant. On November 5, 1973, plaintiff voluntarily dismissed the action without prejudice because she felt Judge Bryant was prejudiced against her case. The case was refiled November 30, 1973, and again assigned to Judge Bryant. Plaintiff filed various motions attempting to disqualify Bryant, all of which were overruled. An original action in mandamus was filed with this court to force assignment of the case to a different trial judge. We denied the motion on April 14, 1976, in Berniece C. Lindquist v. Howard C. Kline, No. 48,311. Judge Kline, the administrative judge, again assigned the case to Bryant after resolution of the mandamus proceeding. The case was tried during November and December, 1976. At the close of plaintiff’s case the court directed a verdict for defendant Clark and for defendant Ayerst as to punitive damages. The case then went to the jury and a verdict was returned for Ayerst and Knapp.
The first issue raised on appeal is whether the administrative judge of the trial court committed reversible error in initially assigning this case to Judge B. Mack Bryant and refusing to reassign the case to another division for trial. Appellant contends the reassignment of the case to Judge Bryant after her voluntary dismissal of the first case was error. The administrative judge relied on Supreme Court Rule 120 (214 Kan. xxxviii), which stated:
“Any case dismissed and refiled shall be assigned to the judge of the same division to whom it was previously assigned.”
The administrative judge followed the express language of the rule. There is no merit to this issue.
As a second part of this issue, appellant contends the administrative judge committed reversible error in overruling her motion for reassignment of the case with accompanying affidavit of prejudice, pursuant to K.S.A. 20-311d(h)(5), which provides:
“(b) Grounds which may be alleged as provided in subsection (a) for change of judge are:
“(5) That the party filing the affidavit has cause to believe and does believe that on account of the personal bias, prejudice, or interest of the judge he cannot obtain a fair and impartial trial. Such affidavit shall state the facts and the reasons for the belief that bias, prejudice or an interest exists.”
We held in Hulme v. Woleslagel, 208 Kan. 385, 493 P.2d 541 (1972), that upon the filing of an affidavit alleging the party has cause to believe and believes he cannot obtain a fair and impartial trial because of the personal bias, prejudice or interest of the judge with specific reasons, the court should assign the matter immediately to another judge for determination of the sufficiency of the affidavit. The affidavit must state facts and reasons, pertaining to the party or his attorney which, if true, give fair support for a well-grounded belief he will not obtain a fair trial. See Oswald v. State, 221 Kan. 625, 628-629, 561 P.2d 838 (1977); State v. Griffin, 3 Kan. App. 2d 443, 445, 596 P.2d 185 (1979). The question of the sufficiency of the affidavit is one of law for the court to determine but “[previous adverse rulings of a trial judge, although numerous and erroneous, where they are subject to review, are not ordinarily and alone sufficient to show such bias or prejudice as would disqualify him as a judge.” Sheldon v. Board of Education, 134 Kan. 135, Syl. ¶ 3, 4 P.2d 430 (1931).
In the instant case, Judge Kline reviewed the affidavit, which primarily alleged previous adverse rulings of Judge Bryant against plaintiff’s counsel. He found the evidence was insufficient to show bias or prejudice. The identical issue was presented to this court in the motion for writ of mandamus. We have again reviewed the issue and find it without merit.
Appellant next contends the trial court committed reversible error in excluding the admission of seven exhibits which are memos from Ayerst Laboratories concerning Fluothane.
Let us consider each exhibit separately. Exhibit 24 is Fluothane Memo 65-A, dated March 25, 1963, which originated with Ayerst Laboratories Sales Department and is addressed to all Ayerst salesmen. Under the heading “Fluothane” the memo begins as follows: The memo goes on to explain that Fluothane is being unjustly accused of causing liver damage and that salesmen would be kept current of all studies regarding the anesthetic. The memo contains no admissions by the company. Ayerst objected to admission of the memo on the grounds of remoteness because Lindquist died in 1969 and the memo is dated 1963. The court sustained the objection.
“During the current furor over ‘Fluothane’ we are intensely aware of your problems in meeting your anesthesiologists and surgeons face to face.”
Exhibit 27, dated June 13, 1963, is also from the sales department and was also excluded for remoteness. It instructs the salesmen to review Fluothane Memo No. 65-E and to “detail ‘Fluothane’ to one surgeon daily during July and August.” The memo then instructs the salesmen regarding proper methods of presenting Fluothane to the surgeon. The memo states:
“Once again, as mentioned in memo No. 65-E, do not voluntarily mention the drug warning letter. If the surgeon did not read it or has forgotten it, don’t remind him. Give him a straightforward outline of the advantages of ‘Fluothane’ but be prepared to discuss the contents of the warning letter as outlined in ‘Fluothane’ Memo No. 65-E if he initiates such a discussion.”
The memo offers the salesmen a sample sales pitch promoting the advantage of Fluothane over other anesthetics.
Exhibits 28 and 29 are from Keith Roberts of Ayerst Laboratories and are directed to a selected group of divisional, district and product managers and chemical research associates and to selected sales staff of the company. The memos dated May 31, 1961, advise them of a problem with a Dr. March who had been sponsored as a speaker on Fluothane, but it was difficult to determine whether he favored Fluothane or chloroform. Both exhibits were excluded because of remoteness. After the court ruled, the following colloquy occurred between attorney Michaud and Dr. Jewell:
Q: (Mr. Michaud) “Did Ayerst Laboratories continue from that period of time in 1963 up until at least February 1969 to instruct their detailmen to not bring up the subject matter of Fluothane and its damage to the liver?
A: (Dr. Jewell) “Not to my belief, no.”
Exhibit 30, dated July 19, 1963, is also from Keith Roberts and is directed to Ayerst salesmen. The memo states that, some anesthesiologists were concerned their continued use of Fluothane would expose them to legal complications. The memo went on to advise the salesmen how to meet and overcome these concerns and it closed by extolling the virtues of Fluothane. This exhibit was excluded as irrelevant and immaterial.
Exhibit 31, dated December 6,1963, was sent out to Ayerst Lab salesmen. It is purely and simply a sales promotion pamphlet advising the salesmen of the reference books on Fluothane being delivered to doctors. This exhibit was excluded because of remoteness. A careful reading discloses doubtful relevancy.
Exhibit 63, dated January 4, 1971, has an agenda for a sales conference meeting attached. It is from B. A. Browne and is directed to all district managers. This exhibit was excluded for remoteness.
Appellant seeks to establish that from 1961 to 1971, Ayerst conducted a systematic and continuing plan of hiding and downplaying the dangers of Fluothane by giving inadequate warnings to doctors and hospitals using Fluothane, and by encouraging the use of Fluothane regardless of possible liver damage. Most of the exhibits are memos and directives to detailmen who are the lab representatives who contact the hospitals and doctors about the company’s products. That such information is admissible in a products liability case is apparent from Stevens v. Parke, Davis & Co., 9 Cal. 3d 51, 65, 107 Cal. Rptr. 45, 507 P.2d 653 (1973), where the court stated:
“Although the manufacturer or supplier of a prescription drug has a duty to adequately warn the medical profession of its dangerous properties or of facts which make it likely to be dangerous, an adequate warning to the profession may be eroded or even nullified by overpromotion of the drug through a vigorous sales program which may have the effect of persuading the prescribing doctor to disregard the warnings given.”
In the instant case, however, the value of the excluded exhibits must be weighed with those that were admitted, numbered 22,23, 25, 26, 33, 35 and 62. These exhibits represent sales promotion pamphlets from Ayerst to its salesmen and are dated from 1962 to 1969. The exhibits cover essentially identical subject matter as that contained in the excluded exhibits. All of the memos contain statements to the effect that the drug warning insert should not be discussed with the doctor unless the doctor brings it up and to downplay the warning and point out the advantages of Fluothane. All are typical promotional type material. The excluded exhibits are no more remote than are those which were admitted and considering the limited purpose for which they were offered, they should not have been excluded for remoteness. They are, however, repetitious and cumulative and present no new issues for jury consideration. We hold the trial court did not commit reversible error in excluding exhibits 24, 27, 28, 29, 30, 31 and 63, although the reason for their exclusion was incorrect. See Tucker v. Lower, 200 Kan. 1, 6-7, 434 P.2d 320 (1967).
Next, appellant contends exhibits 72 and 73 were improperly excluded. The two exhibits represent a compilation in bound form of 49 adverse reaction reports regarding the use of Fluothane, with medical histories, hospital records and in some cases, post mortem reports. Appellant contends this information is vital to show Ayerst was on notice that Fluothane caused liver damage. The reports cover a period from 1961 to 1971. On this point, we held in Robbins v. Alberto-Culver Co., 210 Kan. 147, 154-155, 499 P.2d 1080 (1972):
“Under the circumstances shown to be present here, we think the issue of foreseeability may not be determined as a question of law, but that a question of fact is presented which must be resolved. Evidence was presented on behalf of the defendant that over a period of some ten years the company had received ninety-nine complaints, the last one in 1970, which averages out as two complaints per million bottles sold during that period of time; that the complaints covered such problems as rash on head and ears, hair loss, breaking out of scalp, itching, skin trouble, allergic reaction and swollen eyes; and that the company does not have a written requirement that all distributors and retail stores selling Rinse Away report any complaints received. Whether the accumulation of complaints of allergic reactions up to the time of injury [citation omitted] was sufficient for the defendant to have reasonably apprehended that its product would harm an appreciable class of people is a matter for determination as a fact question.”
For the purpose of showing notice, exhibits 72 and 73 are admissible but, as with the other excluded exhibits, did the exclusion harm the plaintiffs case? We think not. All of the other exhibits, including The National Halothane Study and much of the expert testimony, included adverse reaction reports, some of them duplications of those in the excluded exhibits. The jury had before it the full scope of plaintiff’s case. Exhibits 72 and 73 were merely cumulative of the admitted evidence. The trial court’s order excluding them was proper, but for the wrong reason. Any error is therefore harmless.
Appellant next contends the trial court committed reversible error in excluding certain testimony of Jack D. Webster, a detail-man for Ayerst. Appellant called Webster and, in the course of direct examination, Webster was asked about notes he kept of conversations with Dr. Clark. The trial court sustained Ayerst’s objection to the introduction of the notes. The notes were purportedly made during conversations with Clark on December 3, 1971, and February 2, 1972, wherein Clark allegedly stated he was using more Fluothane now that “our” lawyers are taking care of the case and that he felt “secure because Ayerst has taken the ball.”
Appellant claims the notes show Dr. Clark and Ayerst were in questionable collaboration on the issues of the lawsuit and the entries are admissible to show bias and prejudice of Dr. Clark for impeachment purposes. It should be recalled Mrs. Lindquist sought admission of this testimony in her case in chief in order to impeach Dr. Clark’s testimony. He, however, had not offered any evidence to be impeached. There is- no quarrel with the rule that evidence of bias or prejudice of a witness is relevant and may be shown on cross-examination or in rebuttal or by other witnesses or evidence. 81 Am. Jur. 2d, Witnesses § 547. Before admission of such evidence, however, a proper foundation must be laid. That foundation includes the requirement that the adverse witness sought to be impeached must be questioned before the attempted impeachment through the testimony of a second witness. See Annot., 87 A.L.R.2d 407, 411. Here, appellant was attempting to impeach the testimony of Clark through Webster before Clark had testified. We find the evidence was properly excluded.
Appellant next contends reversible error was committed by the exclusion of a portion of the testimony of Dr. Courtney Clark. One of the questions asked of Dr. Clark was:
“If information about the multiple use of Fluothane and its relation to liver damage has been given you even through the detailmen of Ayerst or the package insert, that is, if they had come to you and said in one form or another if you use this Fluothane on more than one occasion in a 30-day period, for example, it may cause death of liver cells and kill the patient, would you have given consideration to that fact in choosing your anesthetic for Mr. Lindquist?”
The trial court sustained an objection on the grounds the question was compound, speculative, multiple, included hypothetical facts not in evidence and sought conjecture by the witness. The question is highly speculative and the trial court did not abuse its discretion in sustaining an objection to it.
Appellant also claims the trial court committed reversible error in sustaining defendant’s objection to the following question posed to Dr. Clark:
“Do you have an opinion as to whether the majority of the competent medical men today agree that there is a danger of liver damage from using Fluothane twice in a short period of time?”
An abuse of discretion must be found in order to reverse the trial court on the admission of expert testimony. State v. Loudermilk, 221 Kan. 157, 557 P.2d 1229 (1976). A trial court has wide discretion in determining whether it will receive opinion evidence. State v. Hernandez, 222 Kan. 175, 563 P.2d 474 (1977). The witness was qualified as an expert and, therefore, his opinions must have been consistent with K.S.A. 60-456(b). The question was overbroad, lacked proper foundation and called for an opinion based upon current thought, not medical opinion at the time Lindquist was given Fluothane. In addition, the question called for a conclusion based upon facts not personally known or made known to the witness at trial. The trial court properly excluded the testimony.
Appellant next contends that reversible error was committed in directing a verdict on the issue of punitive damages for defendant Ayerst. A verdict of actual damages is essential to a recovery of punitive damages. Webber v. Patton, 221 Kan. 79, 558 P.2d 130 (1976); Dold v. Sherow, 220 Kan. 350, 552 P.2d 945 (1976); Young v. Hecht, 3 Kan. App. 2d 510, 597 P.2d 682, rev. denied 226 Kan. 793 (1979). Punitive damages may be recovered “whenever the elements of fraud, malice, gross negligence, or oppression mingle in the controversy.” Nordstrom v. Miller, 227 Kan. 59, Syl. ¶ 12, 605 P.2d 545 (1980); Temmen v. Kent-Brown Chev. Co. 227 Kan. 45, 605 P.2d 95 (1980). “[B]reach of a fiduciary duty may in some circumstances give rise to a claim for punitive damages.” Modern Air Conditioning, Inc. v. Cinderella Homes, Inc., 226 Kan. 70, 79, 596 P.2d 816 (1979). The jury returned a verdict for Ayerst on the issue of compensatory damages which precludes the recovery of punitive damages. We have held the trial court’s exclusion of evidence was not improper and there is therefore no error in the jury verdict. It follows, in the absence of a verdict of actual damages, that this issue is without merit.
Appellant contends the trial court erred in directing a verdict for Courtney Clark at the close of plaintiff’s evidence. This is a fact issue. Dr. Clark administered the anesthesia to Val Lindquist for his first operation. This cause of action arose after the second operation. Dr. Robert Knapp was the anesthesiologist for the second surgery. The thrust of all of plaintiff’s evidence was to the effect that Fluothane is dangerous when used a second time within a short period of time. There is no evidence Clark had responsibility for the second operation. The only possibility of a thread of connection is evidence that Clark and Knapp practiced in the same medical group. Such is not sufficient to establish a causal relationship between Clark and the death of Val Lindquist. There was no testimony showing Clark committed a wrongful act or neglected to perform a required act. This issue is without merit.
Appellant contends the trial court committed reversible error in overruling her motion for a directed verdict against Dr. Knapp based on the issue of informed’consent. Appellant contends that as a matter of law, Lindquist was not fully informed as to the risks attendant with the use of Fluothane because Lindquist was under the influence of morphine and he was not told of the possibility of liver damage in multiple administrations of Fluothane. The record reveals Knapp testified he is certain he spoke with Lindquist just before the second operation. Knapp is certain he discussed significant risks involving the use of Fluothane but knows he did not discuss possible liver damage from use of Fluothane within a short period of time because the risk was too remote. At the time of Lindquist’s operation, the package insert provided by Ayerst which accompanied Fluothane warned the anesthetic should not be given in multiple administrations when the patient suffers from jaundice or an unexplained high fever. Lindquist was running a fever, but it was the result of a staph infection. Expert testimony revealed the standard of practice in Wichita at that time did not discourage multiple doses of Fluothane. See Chandler v. Neosho Memorial Hospital, 223 Kan. 1, 3, 574 P.2d 136 (1977).
We have examined the medical material submitted with this case regarding the controversy surrounding Fluothane. It would appear Dr. Knapp followed standard medical procedure operating at that time in Wichita. It is also evident that with the knowledge and information available to him at that time, Dr. Knapp properly informed Lindquist of the significant risks involved in the use of the drug,.
Appellant contends Lindquist could not have given an informed consent while under the influence of morphine. The record reveals Knapp discussed the risks of the anesthetic with Lindquist sometime after 12:00 noon and before the surgery began at 1:13 p.m. Lindquist had been given morphine about noon. Knapp concedes the general practice in Wichita at that time was to visit the patient the night before the surgery and discuss the anesthetic to be used. The record reveals very little information regarding Lindquist’s condition while under the influence of morphine, except to say that he was apprehensive about the surgery. In the case of Funke v. Fieldman, 212 Kan. 524, Syl. ¶ 3, 512 P.2d 539 (1973), we stated:
“In the absence of an emergency a physician or surgeon has a legal obligation to make a reasonable disclosure to his patient of the nature and probable consequences of the suggested or recommended treatment, and to make a reasonable disclosure of the dangers within his knowledge which are incident or possible in the treatment he proposes to administer in order that his patient will have a basis to make an intelligent informed consent to the proposed treatment. But the duty of the physician is limited to those disclosures which a reasonable medical practitioner would make under the same or similar circumstances.”
This duty to disclose does not extend to a detailed explanation of all possibilities and risks connected with the drug. See Funke v. Fieldman, 212 Kan. at 531-532. In addition, we stated at syllabus ¶ 9:
“In the trial of a malpractice action wherein the plaintiff claimed inadequate disclosure of risk information by the physician, the patient has the burden of going forward with evidence tending to establish a prima facie cause of action, and ultimately the burden of proof.”
Appellant contends because Lindquist was under the influence of morphine, he was hampered in his ability to give an informed consent to the use of Fluothane during the surgery. We have examined the record and find no evidence propounded by appellant which would indicate Lindquist was under any difficulty giving his consent to the use of the anesthetic. In the absence of evidence to the contrary we hold Dr. Knapp sufficiently informed Lindquist regarding the risks of using Fluothane during this surgical procedure.
Appellant contends the trial court erred in giving its instructions to the jury and in refusing to give the instructions requested by appellant. In her brief, appellant concentrates on eight of the instructions she requested at trial. She contends PIK Civ. 2.24 should have been given at trial. This instruction provides that a jury may distrust or reject testimony of a witness it believes has willfully testified falsely. The comments following the instruc tion at page 53 state,: “To warrant giving this instruction there must be some basis in evidence to show false swearing. This instruction should not be given in the average case.” The instruction is not included in the more current PIK Civ. 2d. Appellant contends the various contradictions in the testimonies of Drs. Jewell, Knapp, Clark and Cohen prove the instruction should have been given. Although there are several inconsistencies in the testimonies of these men, those inconsistencies do not rise to direct falsehoods. The instruction was not warranted.
Appellant contends the court’s gravest error is the failure to give her requested instructions 13 through 16. These instructions reflect different versions of the doctrine of strict liability in tort. Appellee Ayerst contends instructions 16, 17 and 18 given by the court properly reflect the doctrine of strict liability. We have carefully examined the requested instructions and the instructions that were given and find the jury was properly instructed regarding the doctrine of strict liability expressed in Restatement (Second) of Torts § 402A (1965). The jury was instructed to find Ayerst liable provided they found the drug was in a defective condition and unreasonably dangerous to persons who might be expected to use it, where that defect caused or contributed to the death of Lindquist. The defective condition is the failure of Ayerst to properly warn and instruct the medical profession with respect to the use and possible consequences of the use of Fluothane.
Appellant also contends her instruction 19 regarding the law of negligence should have been given; however, we find instructions numbered 19, 20, 21 and 23 given by the court were sufficient to properly inform the jury regarding the issue of negligence.
Plaintiff’s requested instruction 20 poses a different wrinkle. The instruction is PIK Civ. 13.04, which states:
“The manufacturer of a product is required to make such tests for defects therein as are reasonably necessary to assure safety of the product manufactured. Failure to do so constitutes negligence.”
No corresponding instruction regarding the duty to test was given by the court. The “Notes on Use” following the instruction state it should be used in appropriate cases and should follow the general instruction on negligence.
With respect to a manufacturer’s duty to test its product, we note with approval the following statement from 1 Hursh and Bailey, American Law of Products Liability 2d § 2:29, p. 214 (1974):
“The rule is that a manufacturer has a duty to make such tests and inspections, during and after the process of manufacture, as should be recognized as being reasonably necessary to secure the production of a safe product; and a manufacturer who negligently fails to use reasonable care in making such tests and inspections, and thereby produces a defective article which causes damage while being put to an ordinary, anticipated use, is liable for such damage.”
In addition, we note at page 217 that “the plaintiff cannot succeed where he fails to allege or prove that tests or inspections would have been effective . . . .” See 6 A.L.R.3d 91; 63 Am. Jur. 2d, Products Liability §§ 35-37, pp. 45-47. In support of her argument that PIK Civ. 13.04 should have been given, appellant cites the testimony of a Dr. Herbert Wendel, a physician trained in internal medicine and an expert in pharmacology. He testified the chemical properties of chloroform and Fluothane are closely related and that liver damage was a serious side effect of chloroform. Dr. Wendel believes when Ayerst Laboratories marketed their drug in 1958, they should have paid particular attention and thoroughly investigated whether Fluothane could produce similar effects on the liver. Appellant contends Dr. Wendel’s testimony proves that proper testing by Ayerst might have revealed whether Fluothane could produce liver damage. Therefore, she argues the instruction should have been given. We cannot say this evidence alone is sufficient to show such tests would have produced more conclusive results regarding repeated use of Fluothane within short periods of time. It follows therefore, that the trial court did not err in denying the request for the instruction.
Appellant’s final contention goes to the trial court’s failure to instruct on implied warranty of fitness for a particular purpose. She requested PIK Civ. 13.10, which states:
“When a seller at the time of contracting for a sale has reason to know of any particular purpose for which the goods are required and that the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods, there is an implied warranty that the goods shall be fit for such purpose.
“A seller who breaches this warranty is liable to the buyer of such goods who sustains injury as a result.”
The instruction, taken from K.S.A. 84-2-315, contemplates a showing of reliance by the buyer on skill or knowledge possessed by the seller and a showing of a particular purpose, differing from an ordinary purpose, for which the goods are used. See generally K.S.A. 84-2-315, Official UCC Comment. Appellant offers no evidence showing that PIK Civ. 13.10 is applicable to the facts of this case. We are unable to find the trial court erred in excluding the instruction.
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The opinion of the court was delivered by
Miller, J.:
This is an appeal from a final judgment on a cross-claim in a foreclosure action. The University State Bank filed the action against four members of the Blevins family, mortgagors, to foreclose a real estate mortgage. While the action was pending, the amount due the bank was paid in full and the property was sold to third persons. The proceeds were paid into court to await determination of the cross-claim, contesting the legal interests in the property. The bank was dismissed as a party since it no longer had any interest in the lawsuit. Oletha L. Blevins, wife of Leslie Blevins, Sr., is not a party to the cross-claim.
Leslie Blevins, Sr., is the cross-claimant; he appears here as the appellee. The trial court refers to him as the plaintiff. The cross-claim was filed against Leslie Blevins, Jr. and his wife, Marilyn Blevins; they are the appellants. The trial court refers to them as the defendants.
The subject property, a commercial tract located in Lawrence, Kansas, was deeded to Leslie Blevins, Sr., Leslie Blevins, Jr. and Marilyn Blevins in two parcels. The first parcel was conveyed to plaintiff and defendants as tenants in common, the remainder was conveyed to them as joint tenants with right of survivorship. Blevins, Sr. as cross-claimant asserts he is the equitable owner of the entire parcel and that Blevins, Jr. and Marilyn are holders of bare legal title acquired solely for business convenience. The trial court found “[t]he relation of the parties, the facts and circumstances of these transactions and the conduct of the defendants in regard to all aspects concerning the real estate, infer the creation of a resulting trust . . . and that defendants held legal title to their interest in the real estate as trustees for plaintiff.”
The appellants contend that the evidence is insufficient to support the trial court’s conclusion that there was a valid purchase money resulting trust. The facts as disclosed by the evidence are substantially as follows:
The plaintiff, Blevins, Sr., operated the Blevins Bike Shop for many years at 7th and Michigan Streets in Lawrence, Kansas. In 1966, the defendant, Blevins, Jr., terminated his employment with the Lawrence Paper Company and commenced to work for his father in the bike shop. At all times he was a salaried employee. None of plaintiff’s other children worked in the bike shop. In 1971, plaintiff sold the 7th Street property and the subject property located on 6th Street was purchased. The business was moved to the new location.
Plaintiff advanced all of the funds for purchase of the property and he made all of the payments on the mortgage thereafter. He testified in substance that he thought it wise to have the defendants named on the deeds to the new property so that they could continue with the business after his death; the defendants would have no interest until that time, and plaintiff would make all payments on the mortgage during his lifetime; defendants would pay the balance, if any, which remained at plaintiff’s death. This was all discussed with and explained to defendants before the deeds were executed. Plaintiff had no legal advice in this matter.
The business did not prosper in the new location. Defendant Blevins, Jr. took a job with the University of Kansas, and severed his employment with the cycle shop on November 18, 1973. Plaintiff sold the business effective December 31,1973. He leased the property to the purchaser and thereafter collected the rent and paid the taxes, insurance, repairs, and mortgage installments.
In February, 1976, plaintiff consulted an attorney and discussed his estate plan. He was advised to place title to the tract in his name to facilitate the estate planning. He then asked the defendants to sign a quit claim deed; they refused. Mortgage payments were suspended, and this action followed.
At common law, a resulting trust is presumed when consideration is paid by one person and legal title is taken in the name of another. 76 Am. Jur. 2d, Trusts § 206. Our Kansas statutes have abolished this presumption, and for over 100 years it has been our rule that, “[w]hen a conveyance for a valuable consideration is made to one person and the consideration therefor paid by another, no . . . trust shall result . . . subject to the provisions of the next two sections.” K.S.A. 58-2406. The second following section, K.S.A. 58-2408, provides an exception to the 58-2406 rule, “where it shall be made to appear that by agreement and without any fraudulent intent the party to whom the conveyance was made, or in whom the title shall vest, was to hold the land or some interest therein in trust for the party paying the purchase money . . . .” That exception is the one applicable to the case at hand.
The trial judge made some thirty-eight separate findings of fact, each of which is supported by substantial evidence in the lengthy record. We need not detail the evidence further here.
Appellants urge that the standard for proof of an agreement necessary to establish a resulting trust is that of “clear and satisfactory” evidence. Our case law does not compel such a standard.
In the early case of Lyons v. Berlau, 67 Kan. 426, 73 Pac. 52 (1903), we noted that the agreement to create a resulting trust need not be in writing; it may be proved by parol, or by circum stantial evidence. Proof of the agreement in Berlau was “not strong”; but we held it sufficient. We quoted with approval Perry on Trusts, § 137, fifth edition:
“ ‘The certainty required, however, is only such as is sufficient to satisfy the jury of the existence of the trust; and it is error to charge that the “clearest and most positive proof” must be given.’ ” (p. 433.)
We adhered to the Berlau standard in Taylor v. Walker, 114 Kan. 614, 617, 220 Pac. 518 (1923). Appellant relies upon In re Estate of Gereke, 165 Kan. 249, 265, 195 P.2d 323 (1948), where we said, “the proof must be clear and satisfactory to the trial court, not to an appellate court.” A full reading of that opinion, however, discloses that the trial court had a choice of two possible inferences; we held that the court did not err in adopting the inference unfavorable to the appellant. The Gereke court was merely saying that it was the trial court, and not the appellate court, that must be satisfied with the quantum of evidence; it intended no departure from our rule that the usual burden in civil cases, and not the enhanced burden essential in fraud cases, is required.
Testimony of the plaintiff as to the discussion with the defendants prior to taking title, plus the evidence of the subsequent conduct of the parties at the time of closing and over a period of years thereafter, was adequate to establish the existence of an agreement at the time title was acquired, where the evidence appeared satisfactory to and was relied upon by the trier of fact.
Appellants claim error in that there was no “evidence sufficient to rebut the presumption of gift or advancement . . . .” We recognized the presumption of gift, where the consideration is furnished by a husband and title is taken in the name of the wife, in Olson v. Peterson, 88 Kan. 350, 128 Pac. 191 (1912). The rule is concisely and clearly stated in Restatement (Second) of Trusts § 442 (1959):
“Where a transfer of property is made to one person and the purchase price is paid by another and the transferee is a wife, child or other natural object of bounty of the person by whom the purchase price is paid, a resulting trust does not arise unless the latter manifests an intention that the transferee should not have the beneficial interest in the property.”
The presumption of gift, however, is rebuttable, as is pointed out in § 443:
“Where a transfer of property is made to one person and the purchase price is paid by another, and the transferee is a wife, child or other natural object of bounty of the person by whom the purchase price is paid, and the latter manifests an intention that the transferee should not have the beneficial interest in the property, a resulting trust arises.”
Here, there is ample evidence of a contrary intent — the discussion between the parties, the intent of the father to facilitate the continuation of the family business if he should die while the business was in operation, his “self help” effort at estate planning, and the acts and conduct of the parties.
Appellants also urge that the doctrine of resulting trusts is inapplicable to property held as joint tenants with right of survivorship. They rely on Dexter v. Dexter, 481 F.2d 711, 713 (10th Cir. 1973). Reliance on Dexter is misplaced, however, for the claimant there was not a joint tenant with one supplying the consideration, but was challenging succession to ownership under the survivorship provisions of the deed by claiming an equitable right to succeed to the survivor’s interest.
The statute, K.S.A. 58-2408, speaks of “the land or some interest therein”; joint interests are not excluded. In Winsor v. Powell, 209 Kan. 292, 497 P.2d 292 (1972), we found that the incidents of joint ownership of personal property (including right of survivorship) were no bar to a resulting trust. By the same rationale, the holding of title to realty in joint tenancy or as tenants in common does not prevent there being a resulting trust.
We conclude that the trial court did not err.
The judgment is affirmed.
Fromme, J., not participating. | [
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The opinion of the court was delivered by
Fromme, J.:
William N. Lovelace appeals from judgment and sentences imposed after a jury trial in Sedgwick County, Kansas. He was convicted of aggravated sodomy (K.S.A. 21-3506) and of taking indecent liberties with a child (K.S.A. 1979 Supp. 21-3503).
Lovelace is a fifty-year-old man. The victim, a fourteen-year-old boy, and his family had been acquainted with Lovelace for seven or eight years. The boy and Lovelace had been together for various activities such as bowling and movies at least fifty times during the period of their acquaintance. Appellant has an eighteen-year-old son, Mike, who was staying at the Boys’ Industrial School in Topeka. He had been involved in a burglary. Appellant made arrangements to pick up his son for a home visit. He also made arrangements with the parents of the victim to have him accompany appellant to Topeka on a Friday. On Saturday the victim was going to caddy for appellant in a golf tournament. Friday morning the appellant and John, the victim, had breakfast at a restaurant. On the way to the turnpike entrance appellant called John’s attention to some Boy’s Life magazines in the car. John told appellant that he was not a kid anymore and that he wanted some good stuff to read like the magazines in appellant’s house. They turned the car around and returned to the house where John picked up magazines such as Playboy, Honcho, Blueboy, Hustler and Cherry. They then proceeded on their way to Topeka. At some point on the way to Topeka John said to appellant, “My penis gets hard when I look at this stuff.” John testified that appellant responded, “John, why don’t you remove your pants so I can feel your penis.” John removed his pants and appellant rubbed John’s penis for approximately five minutes. This occurred three different times before they arrived at Topeka. These three incidents form the basis for the charge of taking indecent liberties with a child.
While in Topeka appellant stopped at a drugstore and bought John new issues of Hustler and Blueboy magazines. They picked up appellant’s son, Mike, and returned to Wichita. In Wichita the three went to a neighborhood picnic where John obtained permission from his parents to stay at Mike’s house that night, so he would be ready to caddy for appellant the next day. John, Mike and appellant returned to appellant’s house after seeing a movie.
According to John’s testimony appellant asked John to sleep with him instead of sleeping in the living room. John refused and appellant went to bed. After Mike had gone to bed in his own room, John turned off the light and went to bed on the sofa in the living room. A few minutes later appellant entered the living room. He was naked. He knelt down beside the sofa and began rubbing John’s penis. He then began sucking on John’s penis. This continued for approximately fifteen minutes. John said he was shocked by appellant’s actions and couldn’t talk. Appellant returned to his bedroom. John slept until 5:00 o’clock a.m., then left appellant’s residence and walked home, a distance of four or five blocks. John told his father about the events and the police were called about 10:30 that morning.
At the trial which followed, the prosecutor presented the testimony of John and his father. The appellant presented one witness, Mike Lovelace, who testified that he was in and out of the area of the living room after he had retired and that his father did not engage in any sexual activity with John. Mike testified he didn’t see, hear or sense any such activity in the house that evening.
On rebuttal the prosecution asked Mike what his father said the next day when he saw the police coming up the walk toward his house. Mike heard his father say, “Oh my God, oh my God, they have come for me. I know they’re coming for me.”
The first claim of error is based on failure of the trial court to sustain appellant’s motion for judgment of acquittal on the charge of aggravated sodomy. Appellant claims there was no evidence of actual penetration as required by law. See State v. Yates, 220 Kan. 635, 638, 556 P.2d 176 (1976). Sodomy includes oral copulation between persons who are not husband and wife, and any pene tration, however slight, is sufficient to complete the crime of sodomy. K.S.A. 21-3505. The act of sodomy is aggravated when it is performed on a child under the age of sixteen (16) years. K.S.A. 21-3506(h). Evidence that showed the victim’s male organ penetrated beyond the lips of the defendant was a sufficient showing of penetration to complete the crime of sodomy. State v. Williams, 224 Kan. 468, Syl. ¶ 2, 580 P.2d 1341 (1978).
John testified that the appellant “stuck his mouth in my penis — on my penis.” That testimony when believed by the jury was sufficient to establish sufficient penetration to complete the crime of sodomy.
The second issue raised concerns venue on the charge of indecent liberties with a child. The crime was committed while both parties were in transit. The trip began in Sedgwick County. The parties proceeded to Topeka and then returned to Wichita. The parties traveled in at least six counties. The crime occurred in a vehicle and it cannot be determined in which county the crime was committed.
Normally, venue and the place of trial is in the county where the crime was committed. K.S.A. 22-2602. If a crime is committed in any vehicle passing through the state, and it cannot readily be determined in which county the crime was committed, the prosecution may be in any county in this state through which such vehicle has passed or in which such travel commenced or terminated. K.S.A. 22-2608. The case was properly tried in Sedgwick County.
The appellant contends that the information was defective for it failed to allege the crime was committed while in transit. Venue is generally a matter of proof and depends upon the facts and circumstances of each case. It was alleged the crime was committed in Sedgwick County. The trial court properly instructed the jury:
“If any alleged crime is committed in any vehicle passing through this state, and it cannot readily be determined in which county the alleged crime was committed, the prosecution may be in any county in this state through which such vehicle has passed or in which such travel commenced or terminated.”
We hold that the procedure followed in this case, i.e., merely alleging venue in Sedgwick County where the vehicular trip commenced, and then instructing the jury concerning venue for crimes committed in transit, as set out in K.S.A. 22-2608, was entirely proper. See 41 Am. Jur. 2d, Indictments and Informations § 126, p. 960.
The third issue raised on appeal concerns the admissibility of testimony as to the general nature of the contents of the magazines. John was permitted to describe in a general way what was in these magazines. He testified, “Well, just like Honcho and Rlueboy, two men having sex.” In response to a question as to what was in Playboy and Hustler, John testified, “Just man on a woman and just women showing off with all their clothes off.”
Appellant contends that this testimony violates the best evidence rule, K.S.A. 60-467. Magazines are writings within the definition contained in K.S.A. 60-401(ra). The testimony was admitted to prove the general contents of these publications. However, in the statute, K.S.A. 60-467, the best evidence rule is subject to six specific exceptions. Under the fourth exception the best evidence rule does not apply where the writing is not closely related to the controlling issues and it would be inexpedient to require the production of the writing. This exception was applied by this court in State v. Thompson, 221 Kan. 176, 180-181, 558 P.2d 93 (1976). The exception applies in the present case. The magazines were in no way closely related to controlling issues in the case. There was no dispute as to the contents. Production was unnecessary and in some ways might have been prejudicial to the appellant.
It should be remembered that the best evidence rule is not an inflexible rule of exclusion, but rather a preferential rule. State v. Goodwin, 223 Kan. 257, 259, 573 P.2d 999 (1977). Under the circumstances of the present case there was no error in the admission of the testimony.
In the fourth issue raised appellant complains of certain comments made by the trial judge to appellant in the presence of the jury. The trial judge instructed the appellant to be quiet. Apparently appellant was conversing with his attorney in a voice which could be heard by others present in the courtroom.
Canon 3 A (2) of the Code of Judicial Conduct in Kansas places a duty on each judge to “maintain order and decorum in proceedings before him.” K.S.A. 20-175. From the record before this court it appears the trial judge acted properly in carrying out this duty by admonishing appellant to keep his voice down or remain silent.
In his fifth point of error appellant contends the trial court erred in overruling his objection to the admission of certain testimony as rebuttal evidence. During the trial the victim testified that while the second criminal episode was occurring, appellant’s son, Mike, went to a shelf near appellant’s bedroom to secure a towel and wash cloth. The defense, as its sole evidence, subsequently called Mike as a witness. Mike testified that he had made two trips to the linen closet that night, once to get a blanket for the victim and a second time to get a towel for himself. During this second trip, because he had made some noise, he looked and saw the victim was still on the couch and appellant was still in his bedroom. He further testified that he was awake until 2:00 a.m. and saw and heard nothing that would indicate sexual activity going on between appellant and the victim.
On cross-examination the State sought to elicit testimony from Mike of an alleged inculpatory statement made by appellant when the police officers approached the house to arrest him the next day. The proffered testimony was to the effect that when appellant saw the police he stated something like, “Oh my God, oh my God, they have come for me. I know they’re coming for me.” Appellant objected that this was improper cross-examination, and the court at this time sustained the objection.
After the appellant had rested his case the court allowed the State to recall Mike as a rebuttal witness, and to elicit this same testimony from him. Appellant objected that this was not proper rebuttal.
This court has had occasion to consider the rules relating to rebuttal evidence in several recent cases. See State v. Chiles, 226 Kan. 140, 146, 595 P.2d 1130 (1979); State v. Stuart and Jones, 223 Kan. 600, 604, 575 P.2d 559 (1978). The rules are summarized as follows in State v. Shultz, 225 Kan. 135, 138, 587 P.2d 901 (1978):
“Rebuttal evidence is that which contradicts evidence introduced by an opposing party. It may tend to corroborate evidence of a party who first presented evidence on the particular issue, or it may refute or deny some affirmative fact which an opposing party has attempted to prove. ‘It may be used to explain, repel, counteract or disprove testimony or facts introduced by or on behalf of the adverse party. Such evidence includes not only testimony which contradicts the witnesses on the opposite side, but also corroborates previous testimony. The use and extent of rebuttal rests in the sound discretion of the trial court and its ruling will not be reversed unless it appears the discretion has been abused to a party’s prejudice.’ State v. Phipps, 224 Kan. 158, 161, 578 P.2d 709 (1978).”
Under the broad rule endorsed in these cases the testimony in question was properly received as rebuttal evidence.
In his sixth point of error appellant contends that instruction number five relating to the presumption of innocence and reasonable doubt was erroneous. Appellant further contends the instruction is erroneous in stating, “If you have no reasonable doubt as to the truth of any of the claims made by the State, you must find the defendant guilty as charged.” Appellant maintains that this wrongly advises the jury they must find defendant guilty if they have no reasonable doubt as to the truth of the State’s claims, instead of advising if they have no reasonable doubt as to his guilt. He also objects to the fact the instruction speaks in terms of a mandatory adjudication of guilt while K.S.A. 21-3109 only speaks in terms of a mandatory adjudication of acquittal in cases of reasonable doubt.
The instruction in question here was basically taken from PIK Crim. 52.02. The PIK Criminal Instruction 52.02 has been approved consistently by this court. See State v. Trujillo, 225 Kan. 320, 322, 590 P.2d 1027 (1979); State v. Wilkins, 215 Kan. 145, 523 P.2d 728 (1974); State v. Taylor, 212 Kan. 780, 784, 512 P.2d 449 (1973).
Another difference between the instruction given in this case and PIK Criminal 52.02 is that this instruction uses the word must instead of should, as is used in PIK, to describe the jury’s duty. As to this, our decision in State v. Stuart and Jones, 223 Kan. at 603-604, indicates our belief that the two words can be used interchangeably in criminal instructions. Both convey a sense of duty and obligation. We find no substantial difference in the two and what differences there may be could very well be in appellant’s favor.
Appellant’s seventh and final point is that the trial court abused its discretion in imposing the sentences. He complains of the severity of the sentences and of the failure to obtain a presentence report. The sentences were made to run concurrently, not consecutively. Appellant had been convicted of two prior sex crimes. The last occurred only seven months previously.
A sentence fixed by the trial court will not be set aside on appeal if it is within the statutory limits unless it is so arbitrary and unreasonable that it constitutes an abuse of judicial discretion. State v. Coe, 223 Kan. 153, Syl. ¶ 8, 574 P.2d 929 (1977). The longest of the two concurrent sentences was 45 years to life. All factors considered we cannot say there was an abuse of judicial discretion in this regard.
Appellant complains because the trial court failed to request and receive a more recent presentence report. K.S.A. 1979 Supp. 21-4604(1) provides in part:
“Whenever a defendant is convicted of a felony, the court shall require that a presentence investigation be conducted by a probation officer or in accordance with K.S.A. 1978 Supp. 21-4603, unless the court finds that adequate and current information is available in a previous presentence investigation report or from other sources.”
The above law became effective January 1,1979. Appellant was sentenced February 6, 1979. It appears from the record that appellant had been found guilty of a sex crime seven months earlier. At that time a presentence report had been filed. The exception in the mandatory presentence report statute was effective at the time of the sentencing and the court was not required to obtain a second report under such circumstances. Fairly current information was available in the previous report and no error occurred.
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The opinion of the court was delivered by
Miller, J.:
This is a direct appeal in a criminal case by Edwin R. Egbert who was found guilty by a jury of murder in the second degree, K.S.A. 21-3402, as a lesser included offense of the charged crime of first degree murder. He was sentenced to imprisonment for a term of not less than five years nor more than life. He claims that the trial court erred in its jury instructions and in the admission of certain evidence.
The defendant and the victim, Janet Egbert, were married in 1965 and had one child who was 9 years old at the time of this tragedy. Marital problems had arisen. On the evening of January 3,1978, Janet left the home about 6:30 o’clock p.m. with a friend, Debra Garner. They went to Debra’s parents’ house for dinner, then stopped at a local bar, the homes of some friends, and their place of employment, all for short visits. Meanwhile, the couple’s minor child became ill, and defendant unsuccessfully tried to locate his wife. Moments after Janet returned home, about 11:30 o’clock p.m., she was shot in the back, resulting in her immediate death. Upon trial, the defendant contended that Janet stumbled over her purse, and in attempting to arise from the floor, she grabbed hold of defendant’s loaded gun, which discharged accidentally.
Defendant first contends that the court erred in refusing to instruct the jury that intent to kill is a necessary and material element of murder in the second degree. The trial court instructed the jury in accordance with PIK Crim. 56.03, telling them that to establish a charge of murder in the second degree the following claims must be proved: that the defendant killed Janet Egbert; that such killing was done maliciously; and that the act was done on a certain day in Sedgwick County, Kansas. The trial court followed this with the definition of “maliciously,” following PIK Crim. 56.04, stating that “maliciously” means willfully doing a wrongful act without just cause or excuse. That was followed by a definition of “willfully,” meaning conduct that is purposeful and intentional, and not accidental. Similar instructions were approved in State v. Sparks, 217 Kan. 204, 210, 535 P.2d 901 (1975). The court need not put all of the instructions in one; definitions may properly be assembled and given in an orderly fashion. From a fair reading of the instructions given we are convinced that the jury could not have been misled. Murder in the second degree was properly defined and instructed upon.
Defendant next contends that the trial court erred in giving instruction 5 which followed PIK Crim. 54.01, as follows:
“There is a presumption that a person intends all the natural and probable consequences of his voluntary acts. This presumption is overcome if you are persuaded by the evidence that the contrary is true.”
Defendant contends that this instruction could have been interpreted by the jury as either a conclusive presumption on the issue of intent, or as a burden-shifting presumption, in violation of the rationale of Sandstrom v. Montana, 442 U.S. 510, 61 L.Ed.2d 39, 99 S.Ct. 2450 (1979). Trial was held on May 9, 1978; Sandstrom was not decided until June 18, 1979. PIK Crim. 54.01 was discussed at length by our Court of Appeals in the light of Sandstrom in the recent case of State v. Acheson, 3 Kan. App. 2d 705, 601 P.2d 375 (1979), and we need not repeat what was there said. We hold that the two-sentence instruction given creates “a permissive presumption and does not shift the burden of proof to the defendant,” as concluded by the Court of Appeals, (p. 715.)
Defendant next contends that the trial court erred in refusing to instruct the jury that the State is required to negate accident by proof. Defendant proposed an instruction based upon what was said in State v. Doyle, 201 Kan. 469, 478, 479, 441 P.2d 846 (1968). This issue is controlled adversely to the contentions of the defendant by our recent discussion of the subject in State v. Henderson, 226 Kan. 726, 732-733, 603 P.2d 613 (1979). The jury was properly instructed on the State’s burden to prove guilt beyond a reasonable doubt. We find no error.
Defendant next contends that the copies of the trial court’s instructions which were submitted to the jury were incomplete in that instructions numbered 3 and 10, in the set of instructions which the judge filed with the clerk of the district court, were found to be blank pages. The reporter’s notes conclusively show, and counsel admit, that all of the instructions were given orally to the jury. Also, counsel were given complete copies of the court’s instructions for use during oral argument. Xeroxed copies were made of the instructions, and each juror was furnished with a set of instructions; whether those copies included instructions 3 and 10, or whether those two were omitted from the copies given to the jurors because of some malfunction of the copying machine or otherwise, is not disclosed by the record before us. There is no contention that the copy which was eventually filed with the clerk was one of the copies submitted to the jury. The appellant has the burden not only to show error, but to establish that the error resulted in substantial prejudice. Error is not presumed; the burden is upon the appellant to demonstrate it. In the absence of a record showing prejudicial error, an appellate court must assume that the action of the trial court was proper. See State v. Holt, 223 Kan. 34, 45, 574 P.2d 152 (1977); State v. Freeman, 216 Kan. 653, 533 P.2d 1236 (1975).
In the case before us there is no evidence from which this court can conclude that the copies of the instructions given to the jurors were incomplete. Accordingly, we find no error. The trial courts are not required by statute or rule to furnish separate instructions for each juror; ordinarily, the original set of instructions which the court reads to the jury is then handed to the jury for its use in the jury room. Either procedure is proper.
Finally, with regard to instructions, the defendant contends that the trial court erred in failing to instruct upon reasonable doubt, circumstantial evidence, surmise and speculation, character, and motive. The record indicates that the trial court instructed fully on the first three: reasonable doubt, circumstantial evidence, and surmise and speculation. While there were no explicit instructions regarding motive or character evidence, no separate and specific instructions on these subjects were required. The jury was instructed that they might consider as evidence whatever was admitted in the trial as a part of the record. We conclude that the instructions as a whole were fair, that they properly submitted the issues to the jury, and that they were free from prejudicial error.
Defendant next contends that the trial court erred by allowing the State to introduce a conversation which had been ruled inadmissible in a Jackson v. Denno hearing. At that hearing the court ruled that a statement to the effect that “[jjealousy is a terrible thing,” made by the defendant to officers after he had been given the Miranda warnings, was admissible. The State used that statement during cross-examination of the defendant. In response to questioning about that statement, the defendant responded that he had told the officers, “Don’t ever let your wives go to work.” Apparently defendant had made a similar statement to the officers during questioning, which statement the court had ruled inadmissible at the Jackson v. Denno hearing. The State, in its questioning of the defendant before the jury, did not violate the trial court’s Jackson v. Denno ruling. We find no error.
Defendant next contends that the court erred in admitting testimony which was too remote to be relevant. The testimony in question was given by Don Liming, who was employed at the same store in which Janet worked; they frequently rode to and from work together. Liming testified in substance that in November, some six weeks before Janet’s death, the defendant accused Liming of having an affair with Janet; defendant threatened to split Liming’s head open; and he told Janet to pack up her clothes and leave. On the fatal night defendant called Liming and inquired as to Janet’s whereabouts; Liming had not seen her that evening; defendant said that Janet’s clothes would be on the front porch when she returned. Though there was testimony that defendant and his wife had patched things up after the November occurrence, we cannot say that the testimony was not relevant. It has some probative value in determining motive. Under our rules of evidence, K.S.A. 60-407(j), all relevant evidence is admissible. The prosecutor alluded to this evidence in his opening statement, and thus it did not come as a surprise to the defendant when the testimony was elicited. The trial court did not abuse its discretion under K.S.A. 60-445 in admitting this evidence.
Finally, defendant contends that the trial court erred in permitting the prosecutor, during cross-examination of the defendant, to ask the defendant to demonstrate to the jury how he contended Janet was shot, and in permitting the prosecutor to demonstrate the defendant’s version during closing argument. Defendant cites no authorities for his objection to this demonstration. In State v. Robinson, 516 S.W.2d 40 (Mo. App. 1974), the prosecution asked the defendant to demonstrate the position of the parties during the fatal scuffle in accordance with his prior testimony on direct examination. The Court of Appeals held that this was within the scope of direct testimony and did not violate the defendant’s guarantee of freedom from self-incrimination. For similar cases where demonstrations made by defendant as a witness were held admissible, see Annot., Evidence - Re-enactment of Crime, 100 A.L.R.2d 1257, 1261. The re-enactment here requested was simply to demonstrate how defendant contended the shooting occurred. The defendant had testified in detail as to the occurrence during his direct testimony. The requested re-enactment was not beyond the scope of defendant’s direct testimony and did not violate his constitutional guarantee against self-incrimination. It constituted a proper part of his cross-examination. We find no error.
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The opinion of the court was delivered by
Schroeder, C.J.:
This is an appeal by the Attorney General in a declaratory judgment action from a decision of the district court upholding the constitutionality of K.S.A. 1979 Supp. 79-342. The sole issue on appeal is whether that statute violates art. 11, § 1 of the Kansas Constitution.
The facts are stipulated. The Kansas Legislature in 1978 enacted K.S.A. 79-341 and 342 in response to cries for ad valorem tax relief for the State’s farmers and ranchers. In 1979 the legislature enacted a minor amendment to 79-342. On November 7, 1979, the Attorney General (plaintiff-appellant) initiated this ac tion in the District Court of Shawnee County at Topeka, Kansas, against Philip W. Martin, Director of Property Valuation, Kansas Department of Revenue (defendant-appellee). The petition sought a declaratory judgment that K.S.A. 1979 Supp. 79-342 violated art. 11, § 1 of the Kansas Constitution. The case was submitted to the trial court on a stipulated record and written briefs. On December 31, 1979, the trial court upheld the constitutionality of K.S.A. 1979 Supp. 79-342 in a memorandum opinion. Appeal was duly perfected to the Court of Appeals. On January 25, 1980, on motion of appellant, ánd in accordance with the authority granted by K.S.A. 1979 Supp. 20-3017, this case was transferred to the Supreme Court and set for hearing on February 28, 1980.
Article 11, § 1 of the Kansas Constitution is the fundamental law against which the validity of K.S.A. 1979 Supp. 79-342 must be tested. In clear and simple language that fundamental law vests the State’s taxing authority in the legislature, stating:
“The legislature shall provide for a uniform and equal rate of assessment and taxation, except that the legislature may provide for the classification and the taxation uniformly as to class of motor vehicles, mineral products, money, mortgages, notes and other evidence of debt or may exempt any of such classes of property from property taxation and impose taxes upon another basis in lieu thereof. All property used exclusively for state, county, municipal, literary, educational, scientific, religious, benevolent and charitable purposes, and all household goods and personal effects not used for the production of income, shall be exempted from property taxation.”
In response to the constitutional command to provide for a uniform and equal rate of assessment and taxation the legislature has enacted many statutes. Among the statutes material to a decision herein are the following:
K.S.A. 79-501 provides:
“Each parcel of real property shall be appraised at its fair market value in money, the value thereof to be determined by the assessor from actual view and inspection of the property; but the price at which such real property would sell at auction or forced sale shall not be taken as the criterion of such fair market value in money. Tangible personal property shall be appraised at its fair market value in money at the place where the same may be held. All such real and tangible personal property shall be appraised at its fair market value in money and assessed as required in K.S.A. 79-1439.”
K.S.A. 79-1406 provides:
“All property, real or personal, shall be appraised at its fair market value in money, and all real and tangible personal property which is subject to general property taxes shall be assessed at its fair market value in money as required in K.S.A. 79-1439.”
K.S.A. 79-1439 provides in pertinent part:
“[A]ll real and tangible personal property which is subject to general property taxes shall be appraised uniformly and equally at its fair market value in money, as defined in K.S.A. 79-503, and assessed at thirty percent (30%) thereof.”
K.S.A. 79-503, in pertinent part, provides for the determination of fair market value in money as follows:
“Fair market value in money shall mean the amount of money that a well informed buyer is justified in paying and a well informed seller is justified in accepting, assuming that the parties thereto are acting without undue compulsion and that the property has been offered at the market place for a reasonable length of time. Sales in and of themselves shall not be the sole criteria of fair market value but shall be used in connection with cost, income and such other factors as may be appropriate including but not by way of exclusion:
“(a) The proper classification of lands and improvements;
“(b) the size thereof;
“(c) the effect of location on value;
“(d) depreciation, including physical deterioration or functional, economic or social obsolescence;
“(e) cost of reproduction or improvements;
“(f) productivity;
“(g) earning capacity as indicated by lease price or by capitalization of net income;
“(h) rental or reasonable rental values;
“(i) sale value on open market with due allowance to abnormal inflationary factors influencing such values; and
“(j) comparison with values of other property of known or recognized value. The ratio study shall not be used as an appraisal for appraisal purposes.”
K.S.A. 75-5105a instructs the Director of Property Valuation of the State Department of Revenue to render assistance and provide certain assessment tools to all county and district appraisers. In pertinent part, 75-5105a(h) provides that the director shall:
“Devise and/or prescribe guides showing fair market value in money of personal property. The director of property valuation shall furnish to each county one copy of each guide so prescribed and a copy or copies, at said director’s discretion, of each guide so devised. In the preparation of such guides, the director of property valuation shall confer with representatives of the county appraisers and district appraisers, and shall seek counsel from official representatives of organized groups interested in and familiar with the value of classes of property with which they are concerned. ” (Emphasis added.)
The two statutes which gave birth to this dispute, K.S.A. 1979 Supp. 79-341 and 342, provide as follows:
“79-341. Valuation of farm machinery and equipment; purpose of act. [1] Inasmuch as the economy of this state is based, to a large extent, on agriculture, and inasmuch as the economy of the individual fanners and ranchers in this state is placed in jeopardy as a result of the increase in the fair market value of their machinery and equipment, [2] it is therefore declared that the purpose of this act shall be to establish the fair market value of farm machinery and equipment for the purpose of taxation and avoid accentuating the impact of the severe economic crisis confronting such persons. [3] It is also the purpose of this act to provide administrative relief to county appraisers, county clerks, county commissioners, and the state board of tax appeals who are faced with an overwhelming deluge of tax appeals and tax protests resulting from the market value appraisal of farm machinery and equipment.
“79-342. Same; method to be utilized in determining valuation for 1979 tax year, (a) (1) For the purpose of determining the fair market value of farm machinery and equipment for the year 1979, the county appraiser shall utilize the estimated qverage values of such property as indicated by the 1979 Kansas appraisal guide for farm machinery and equipment as devised or prescribed by the director of property valuation and shall subtract from such values an amount equal to twenty percent (20%) thereof.
“(2) It shall be the duty of the county appraiser to value all farm machinery and equipment utilizing the values established under the provisions of part (1) of this subsection except that the appraiser shall deviate from the value so established when he or she determines that the value assigned to such property in accordance with part (1) of this subsection does not reflect the fair market value of the particular property involved as provided for by part (1) of this subsection.
“(b) The term ‘farm machinery and equipment’ means that personal property used by the owner thereof in conducting a farming or ranching operation. The term ‘farm machinery and equipment’ shall not include any passenger vehicle, truck, truck tractor, trailer, semitrailer or pole trailer, other than a farm trailer, as said terms are defined by K.S.A. 1979 Supp. 8-126 and amendments thereto.” (Emphasis and numbers in brackets are added to facilitate further discussion.)
Article 11, § 1 is probably one of the most litigated provisions of the Kansas Constitution; it has been amended three times since the original version was adopted in 1859 at the Wyandotte Convention. One of the earliest decisions by this Court interpreting the meaning of art. 11, § 1 was Hines et al. v. City of Leavenworth et al., 3 Kan. *186 (1865). Explaining the meaning of uniform and equal assessment, the Court stated:
“Each man in the State, county and city, is equally in proportion to his property interested in maintaining the State, county and city governments, and in that proportion should bear the burden equally. There is a justice in this arrangement which commends it to the approbation of any right thinking man . . . .”3 Kan. °201-02. (Emphasis added.)
In 1915 the Court had occasion to review many of our prior decisions interpreting art. 11, § 1. In Wheeler v. Weightman, 96 Kan. 50, 58, 149 Pac. 977 (1915) this following statement was made:
“The foregoing decisions, covering the period of the state’s history to the year 1900, are full, clear, consistent with each other, and indubitably sound. The doctrine they announce was the one with which the people were familiar when the constitution was framed, and the work of the constitutional convention consisted principally in stating the doctrine in suitable phraseology. The essentials are that each man in city, county, and state is interested in maintaining the state and local governments. The protection which they afford and the duty to maintain them are reciprocal. The burden of supporting them should be borne equally by all, and this equality consists in each one contributing in proportion to the amount of his property. To this end all property in the state must be listed and valued for the purpose of taxation, the rate of assessment and taxation to be uniform and equal throughout the jurisdiction levying the tax. The imposition of taxes upon selected classes of property to the exclusion of others, and the exemption of selected classes to the exclusion of others, constitute invidious discriminations which destroy uniformity. That the system works badly now is ground for change, but the system having been established by the constitution as a limitation on the power of the legislature, the constitution must be changed before the system can be changed.” (Emphasis added.)
The legislature eventually responded to the decision in Wheeler, and in 1924 an amendment to art. 11, § 1 was adopted. The amendment, inter alia, permitted classification of mortgages for taxation under the exception to the “uniform and equal rate of assessment and taxation.” Attempted exemption of mortgages from taxation was the basis of the action in Wheeler.
Here we are confronted with an unsatisfactory method of assessing and taxing farm and ranch machinery as part of the ad valorem tax plan. For the reasons hereafter assigned we must repeat now what the Supreme Court said in Wheeler: “the constitution must be changed before the system can be changed.”
This Court has repeatedly held that art. 11, § 1 of the Kansas Constitution requires the legislature to provide for uniformity in the basis of assessment as well as in the rate of taxation. Uniformity in taxing implies equality in the burden of taxation. Gordon v. Hiett, 214 Kan. 690, 693, 522 P.2d 942 (1974); Northern Natural Gas Co. v. Bender, 208 Kan. 135, 143, 490 P.2d 399 (1971), cert. denied 406 U.S. 967 (1972); Commercial National Bank v. Board of County Commissioners, 201 Kan. 280, 286, 440 P.2d 634 (1968); Addington v. Board of County Commissioners, 191 Kan. 528, Syl. ¶ 3, 382 P.2d 315 (1963).
The foregoing cases stand for the proposition that all property which is subject to general property taxation must be valued or assessed on an equal basis. In the recent case of State ex rel. Schneider v. City of Topeka, 227 Kan. 115, Syl. ¶ 5, 605 P.2d 556 (1980), this principle is acknowledged where the Court states:
“When the rate of property assessment is uniform throughout a taxing district, the constitutional mandate of uniform and equal taxation has been fulfilled.”
The term “assessment” as employed in art. 11, § 1 means the process of listing and valuing property for taxation. See Commercial National Bank v. Board of County Commissioners, 201 Kan. 280, Syl. ¶ 3; Wheeler v. Weightman, 96 Kan. at 53.
The legislature, in responding to the mandate of art. 11, § 1 of the Kansas Constitution that it provide for a uniform and equal rate of assessment and taxation, has provided that all property subject to taxation be valued on an equal basis. The equal basis currently provided by the legislature is “fair market value in money.” “Fair market value” has a well defined meaning in our free economy and in case law. The legislature defined “fair market value” in K.S.A. 79-503 in substantially the same language as this Court has defined it, and as it is generally understood and accepted. Mobil Pipeline Co. v. Rohmiller, 214 Kan. 905, 926, 522 P.2d 923 (1974).
In the case at bar, the crucial inquiry is the legislative intent and purpose for enacting K.S.A. 1979 Supp. 79-342. The trial court’s statement that judicial construction of legislation should be based on legislative intent, to be determined from the whole act, and should be in accordance with the general intent and purpose of the entire statute, is unquestionably correct. However, the trial court’s conclusion, that the legislative intent and purpose for the enactment of 79-342 was to insure that farm machinery and equipment would be appraised uniformly and equally at its fair market value in money, is incorrect. There is no basis in fact for such conclusion.
The legislature, in 79-342, directs the county appraisers of this State to reduce the values of certain farm machinery and equipment contained in the 1979 Kansas Appraisal Guide, by subtracting from such values an amount equal to 20% thereof. Consider, for example, the effect of this law upon the value assigned in the 1979 Kansas Appraisal Guide for an “ALLIS-CHALMERS 7580 D°” tractor, model year 1978. The value listed in the guide for all such Allis-Chalmers tractors is $35,420. Pursuant to the provi sions of 79-342(a)(l), that value is to be reduced by $7,084 ($35,420 times 20%). Thus, the value determined for all such tractors in average condition, if used in farming and ranching operations, is $28,336, instead of $35,420. (Pursuant to K.S.A. 79-1439, $28,336 is then multiplied by 30% to arrive at the assessed valuation.) The effect of a flat, across-the-board reduction of 20% refutes the Director’s contention that this method of assessment was designed by the legislature to achieve the ultimate goal of valuing all property upon an equal basis.
It is admitted by the Director that pursuant to K.S.A. 75-5105a(h) the Director of Property Valuation is required to devise or prescribe guides showing the fair market value in money of the tangible personal property here in question. In the absence of evidence to the contrary, the Director is presumed to have followed the statutory requirements. Hence, the 1979 Kansas Appraisal Guide established the fair market value in money of farm machinery and equipment in average condition, in accordance with K.S.A. 79-503 and 75-5105a(fe).
In 79-341, the legislature expressly declared the purpose for the enactment of 79-342 was “to establish the fair market value of farm machinery and equipment for the purpose of taxation. ” (No. 2, emphasis added.) The legislature specifically stated “the economy of the individual farmers and ranchers in this state is placed in jeopardy as a result of the increase in the fair market value of their machinery and equipment.” (No. 1, emphasis added.) It must be noted that “the increase in the fair market value of their machinery and equipment” as established in the 1979 Kansas Appraisal Guide is nevertheless “the fair market value in money” of such farm machinery and equipment determined pursuant to K.S.A. 79-503.
If the legislature itself had established the fair market value in money for farm machinery and equipment, in accordance with its own directive in K.S.A. 79-503, what factors were the appraisers to use in deviating from the value established by the legislature (K.S.A. 1979 Supp. 79-342[a][2])? An apparent inconsistency between 79-342(a)(l) and (a)(2) is explained by careful analysis of the 1979 Kansas Appraisal Guide and the provisions of 79-342(a)(2). On the inside cover of the 1979 Kansas Appraisal Guide is a statement by the Director reading as follows:
“This Kansas Appraisal Guide is furnished in accordance with K.S.A. 75-5105a part b. The values listed herein represent market value for property in average condition.” (Emphasis added.)
It is obvious that a piece of farm machinery or equipment of a given model and year may vary considerably in its fair market value, depending upon the use to which the particular piece of farm machinery or equipment has been put. One piece of machinery may be almost completely worn out from use in farming and another by reason of lack of use on a farm may be in almost new condition. The county appraiser is permitted by 79-342(a)(2) to deviate from the value established pursuant to 79-342(a)(l), where the appraiser utilizes “the estimated average values of such property.”In fact, this deviation is permitted by 79-342(d)(2) only when it is determined that “the value assigned to such property in accordance with part (1) of this subsection does not reflect the fair market value of the particular property involved as provided for by part (1) of this subsection. ” (Emphasis added.) The fair market value of the particular property involved as provided for by part (1) in 79-342(a) requires that 20% be subtracted from the value of such property as determined from the 1979 Kansas Appraisal Guide.
The legislature in stating the purposes for the enactment of 79-342, expressly found in 79-341 that “the economy of the individual farmers and ranchers in this state is placed in jeopardy as a result of the increase in the fair market value of their machinery and equipment.” (No. 1.) It therefore declared the purpose of the act to be “to establish the fair market value of farm machinery and equipment for the purpose of taxation and avoid accentuating the impact of the severe economic crisis confronting such persons.” (No. 2, emphasis added.) It also declared an additional purpose was “to provide administrative relief to county appraisers, county clerks, county commissioners, and the state board of tax appeals who are faced with an overwhelming deluge of tax appeals and tax protests resulting from the market value appraisal of farm machinery and equipment.” (No. 3, emphasis added.)
The legislature was granting relief to persons — the owners of farm machinery and equipment — who were confronted with a severe economic crisis. The legislature found the crisis resulted in protests from individual farmers and ranchers concerning the market value appraisal of their farm machinery and equipment.
It is important to note the legislature in declaring the purposes for the enactment (79-342) recognized the appraisal of farm machinery and equipment owned by the farmers and ranchers was at its fair market value in money in accordance with prior existing legislation.
It could not be said, with propriety, that the increase in the fair market value of farm machinery and equipment which concerned the legislature, and which prompted it to enact 79-342, was caused by the Director of Property Valuation improperly adding to the valués of farm machinery and equipment set forth in the previous year’s appraisal guide. It is clear, however, that some increase in the fair market value of farm machinery and equipment prompted the legislature to enact 79-342. That increase resulted from the amount of money that a willing buyer was justified in paying and a willing seller was justified in accepting for such farm machinery and equipment. In short, the fair market value in money of farm machinery and equipment, as defined by this Court (see Mobil Pipeline Co. v. Rohmiller, 214 Kan. at 926), andas defined in K.S.A. 79-503, was increasing. Notwithstanding this fact, in 79-342 a flat, across-the-board 20% reduction in valuation was ordered. The effect of that was not to correct an error, it was to lower the fair market value in money of farm machinery and equipment used by the owner thereof in conducting a farming or ranching operation.
Even if it be assumed that the 1979 Kansas Appraisal Guide was in error, and that the legislative purpose was, in fact, to correct the situation, the provisions of 79-342 would correct the error for some, but not all, owners of identical items of machinery and equipment. By the provisions of 79-342(b) the 20% reduction in valuation was limited to only designated items of farm machinery and equipment, i.e., “personal property used by the owner thereof in conducting a farming or ranching operation.” As a result, the same items of machinery and equipment listed in the 1979 Kansas Appraisal Guide will be valued differently by the county appraiser, depending upon the use made of such machinery and equipment by its owners. The value of the various items of property listed in the 1979 Kansas Appraisal Guide have been determined irrespective of the owner’s use. For example, under the 1979 Kansas Appraisal Guide, there is but a single value established for a specified horse trailer; the value of such horse trailer is the same whether it is used by its owner in a farming or ranching operation or used by its owner for some other purpose.
The appraisal guide is a reflection of the marketplace, recognizing that the value of an item of property is based upon the price a willing buyer is justified in paying to a willing seller. The occupation in which such property has been used by the seller is immaterial in determining the fair market value of such property. The use of an item of property may affect the condition of the property, but that fact is accounted for in the appraisal guide, which reflects the fair market value in money of property in average condition.
This law is inseparably linked to the appraisal guide; if the legislature found the guide was wrong, action should have been taken to correct the guide. By limiting the application of this law to property used by the owners thereof in conducting a farming or ranching operation the broad class of all property listed in the guide was ignored, and a subclass was created, consisting of tangible personal property used in a prescribed manner by its owners.
A finding that a subclassification of property was justified because of “the severe economic crisis” confronting individual farmers and ranchers confuses economic conditions affecting property owners with economic factors affecting the value of property. Such reasoning confuses the ad valorem property tax with the income tax. Unlike the income tax, the property tax is based on the value of the property itself, not on the income or economic condition of the property’s owner. See Callaway v. City of Overland Park, 211 Kan. 646, 651, 508 P.2d 902 (1973), where the Court states: “An ad valorem tax is a tax imposed upon the basis of the value of the article or thing taxed. ’’(Emphasis added.)
K.S.A. 79-503(d) requires that the appraiser, in determining the fair market value in money of an item of property, consider “depreciation, including physical deterioration or functional, economic or social obsolescence.” That factor affecting the value of the property does not include economic conditions confronting the owners of property. The unprofitable nature of a business, that is, the adverse economic conditions confronting the owner of a business, is not the same as the economic factor of functional, economic or social obsolescence which affects the value of the property itself. See Northern Natural Gas Co. v. Dwyer, 208 Kan. 337, 356-57, 492 P.2d 147 (1971), cert. denied 406 U.S. 967 (1972).
Therefore, it is abundantly clear the factor of functional, economic or social obsolescence to be considered in valuing property does not justify the discriminatory subclassification established by the provisions of 79-342.
The Director also argues that K.S.A. 79-503(i) is a factor to be taken into consideration in determining the fair market value in money of property. It provides that among the factors to consider in determining fair market value is the “sale value on open market with due allowance to abnormal inflationary factors influencing such values.” There are two reasons why this factor does not justify the unlawful subclassification created in 79-342. First, the Court can take judicial knowledge of the fact that even though there has been an inflation of property values in recent years, the rate of inflation was not 15% in 1978, nor was it 20% in 1979. Thus, neither the fixed percentage rate reduction ordered by the provisions of 79-342, nor those of its predecessor, K.S.A. 1978 Supp. 79-342, can be justified on the basis of the inflation rate. Second, to shield certain property, that is, “farm machinery and equipment,” from the effects of inflation, when inflation is affecting all property, is an act of discrimination, inconsistent with art. 11, § 1 of the Kansas Constitution.
Based upon all the foregoing reasons, the Director’s attempt to justify the enactment of K.S.A. 1979 Supp. 79-342 must be rejected, as the law is inconsistent with the provisions of art. 11, § 1 of the Kansas Constitution. By destroying the constitutionally required uniformity and equality in the assessment of all property, a partial exemption from taxation has been granted to farm machinery and equipment. The effect is to lessen the tax burden that should be borne by such property, all for the purpose of reducing the property tax liability of some owners of farm machinery and equipment.
The principle of “partial exemptions” was explained by the United States Supreme Court in Huntington v. Worthen, 120 U.S. 97, 101, 30 L.Ed. 588, 7 S.Ct. 469 (1887), where the Court said:
“The assessment of property, that is, the appraisement and estimate of its value, is the basis upon which the amount of the tax is fixed. A law, therefore, omitting from assessment portions of any particular property, thus lessening the estimate of its value, has the effect of exempting it to that extent from taxation. That result cannot be accomplished, as well observed by the Supreme Court of the state, [Arkansas] under the guise of regulating the duties of assessors.” (Emphasis added.)
The ultimate effect of 79-342 was to lessen the legitimate estimate of the fair market value in money of certain items of farm machinery and equipment, and thus, exempt it to that extent from taxation. In this respect the law violates the requirement of art. 11, § 1 of the Kansas Constitution mandating uniformity and equality in the basis of assessment.
The introductory clauses of 79-341 clearly indicate that 79-342 was an attempt to aid the economy of the individual farmers and ranchers in this State, in order to avoid accentuating the impact of the economic crisis confronting such persons. However, art. 11, § 1 of the Kansas Constitution prohibits favoritism, and requires uniformity in valuing property for assessment purposes so that the burden of taxation will be equal. Addington v. Board of County Commissioners, 191 Kan. at 532; Wheeler v. Weightman, 96 Kan. at 58; Hines, et al. v. City of Leavenworth et al., 3 Kan. *186, Syl. ¶ 5. Property taxation is not based upon the owner’s ability to pay. Economic distress is no justification for ignoring the constitution.
Accordingly, it is held the provisions of K.S.A. 1979 Supp. 79-342 destroy the uniformity and equality in the rate of assessment of tangible personal property required by art. 11, § 1 of the Kansas Constitution and are therefore void. The act grants a partial exemption from taxation to certain items of farm machinery and equipment, according preferential tax treatment to some owners of such property, in violation of art. 11, § 1 of the Kansas Constitution.
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The opinion of the court was delivered by
Prager, J.:
This is a dispute between two secured creditors over the priority of their security interests in an Allis-Chalmers combine. The facts in the case are undisputed and are covered generally by a stipulation of fact filed by the parties in district court. The factual circumstances giving rise to the controversy are set out in chronological order as follows: On November 16, 1970, Lloyd Catlin executed a retail installment contract to Ochs, Inc., a dealer for Allis-Chalmers Corporation, to cover the purchase price of an Allis-Chalmers combine identified as G-7754. This contract was in a total amount of $10,149.44 including the financing charge. There was no provision in the contract for future advances. In the course of the opinion, this will be referred to as contract #1. This contract was assigned to plaintiff-appellant, Allis-Chalmers Credit Corporation, who financed the transaction. On November 27, 1970, a financing statement covering combine G-7754 was filed by Allis-Chalmers with the register of deeds of Barber County, Kansas.
On December 19,1970, Cheney Investment Company, Inc., the defendant-appellee, made a cash advance to Lloyd Catlin, taking a security interest (chattel mortgage) in combine G-7754. On December 24, 1970, Cheney Investment filed a financing statement covering combine G-7754 with the Barber County register of deeds. In the course of the opinion, we will refer to the security interest of Cheney Investment as the chattel mortgage. On September 17,1971, Catlin purchased a new Allis-Chalmers combine G-17992 from Highway Garage and Implement Company, another dealer of Allis-Chalmers. The retail installment contract which created the security interest included both the new combine, G-17992, and the used combine, G-7754. This contract will be referred to in the opinion as contract #2. Contract #2 provided that contract #1 was cancelled and the notation “Payoff ACCCWichita $4,542.00” was written on its first page. The balance owing under contract #1 was included in the purchase price stated in contract #2. There was no other reference to the prior security agreement or financing statement. On September 29, 1971, Allis-Chalmers Credit Corporation, as assignee of contract #2 from Highway Garage and Implement Company, filed a financing statement covering both the new combine G-17992 and the used combine G-7754. On February 16, 1972, Allis-Chalmers notified Cheney Investment of its claim to a senior security interest on combine G-7754, as Cheney had taken possession of that combine when Catlin defaulted on his loan payments to Cheney Investment.
On May 30, 1972, Allis-Chalmers and Cheney Investment executed a letter agreement to allow combine G-7754 to be returned to Catlin, the debtor, with each party to notify the other if Catlin defaulted on either financing agreement. On September 11, 1973, after several revisions and amendments to contract #2, Catlin sold combine G-17992 and paid Allis-Chalmers $11,641.12, leaving an unpaid balance of $8,300. A new payment schedule was prepared for the balance owing plus a new finance charge. Thereafter, Catlin defaulted on his payments, both to Allis-Chalmers and to Cheney Investment. On March 1, 1974, Cheney Investment sold combine G-7754 at a chattel mortgage sale, having taken possession shortly after Catlin defaulted on the Allis-Chalmers obligation. Allis-Chalmers participated in the sale but was not the purchaser. The sale proceeds totaled $8,560. Subtracting the amount then owing to Cheney Investment and costs, there remained $2,111.80 to satisfy the security interest of Allis-Chalmers.
Following the above events, the plaintiff, Allis-Chalmers, brought this action against Cheney Investment for conversion of combine G-7754, claiming a senior and prior security interest. At that time, Catlin’s indebtedness to Allis-Chalmers was in the amount of $8,650 plus interest. In its answer, Cheney Investment claimed a first and prior lien against the combine in the amount of $6,093.79 plus interest. All of the above facts were stipulated by the parties. In addition to the stipulation, the case was submitted on the deposition of Richard F. Ellis, vice-president of Allis-Chalmers. In his deposition, Ellis testified that contract #1 between Ochs, Inc., and Lloyd Catlin was paid off and cancelled at the time contract #2 was executed and the balance owing on contract #1 was carried forward and became a part of the consideration for contract #2. He agreed that contract #2 was a new and separate contract.
The district court held in favor of defendant Cheney Investment, reasoning that contract #2 cancelled the prior contract #1 and was thus an entirely new and separate agreement which created an entirely new and distinct security interest. In its memorandum decision, the trial court emphasized that contract #1 was one involving only the sale of combine G-7754 and, since it contained no provision covering future advances or sales, it was a distinct and separate transaction from contract #2. The trial court then concluded that the advances made under contract #2, dated September 17, 1971, did not relate back and were not covered by the financing statement filed by Allis-Chalmers on November 27, 1970. Thus, it concluded that the intervening security interest of Cheney Investment, created by its chattel mortgage on December 19, 1970, and perfected by the filing of its financing statement on December 24, 1970, was a security interest, senior and prior to the security interest of Allis-Chalmers created by contract #2 in September of 1971. The trial court entered judgment in favor of defendant Cheney Investment, and Allis-Chalmers has appealed to this court.
The question of priority presented in this case is one of first impression in this state under the Kansas Uniform Commercial Code, K.S.A. 84-1-101 et seq. The subject of secured transactions is covered in Article 9 of the code (84-9-101 through 84-9-508). The question of priorities between conflicting security interests is controlled by K.S.A. 84-9-312(5)(a). However, that section interrelates with and must be read with other sections of Article 9 in order to be properly understood. At the outset, we should consider some of these provisions of the code before turning to a resolution of the issue presented. K.S.A. 84-9-303 requires both “attachment” and “perfection” for a security interest to come into existence. Attachment occurs when a creditor extends value and enters into an agreement for the debtor to give a security interest to the creditor in some property of the debtor (84-9-204[l]). Perfection is accomplished (with exceptions not here pertinent) upon the filing of a financing statement (84-9-302). It is immaterial which of these steps occurs first. It is provided in 84-9-402 that a “financing statement may be filed before a security agreement is made or a security interest otherwise attaches.” The UCC comment to 84-9-303 states:
“If the steps for perfection have been taken in advance (as when the secured party files a financing statement before giving value or before the debtor acquires rights in the collateral), then the interest is perfected automatically when it attaches.”
In this case, both of the parties have perfected their respective security interests. Simply stated, the issue to be determined is which of their security interests is entitled to priority over the other. Section 84-9-312(5)(a) governs the priority as between conflicting security interests. Prior to 1975, K.S.A. 84-9-312 provided in part as follows:
“Priorities among conflicting security interests in the same collateral. (1) The rules of priority stated in the following sections shall govern where applicable: . . .
“(5) In all cases not governed by other rules stated in this section . . . priority between conflicting security interests in the same collateral shall be determined as follows:
“(a) In the order of filing if both are perfected by filing, regardless of which security interest attached first under section 84-9-204(1) and whether it attached before or after.filing;” (Emphasis supplied.)
At this point, we should examine K.S.A. 84-9-402. Subsection (1)sets out the simple formal requisites of a financing statement under this article:
(1) Signatures of the debtor and secured party;
(2) addresses of both parties; and
(3) a description of the collateral by type or item.
It is important to note that the security agreement itself is not filed of record. As pointed out in the official UCC comment to 84-9-402, this section adopts a system of “notice filing.” The notice itself indicates merely that the secured party may have a security interest in the collateral described. The burden is placed upon other persons to make further inquiry from the parties concerned in order to obtain a disclosure of the complete state of affairs. The code philosophy is that a simple, filed notice that the secured party and debtor may be financing with respect to collateral described in the financing statement should be a “red flag” warning to third parties not to proceed with any financing on the same collateral of the debtor until investigation is made to see that the road ahead has been cleared. See In re Rivet, 299 F. Supp. 374, 379 (E.D. Mich. 1969), citing Professor Roy L. Steinheimer, Jr., of the University of Michigan Law. School, in a commentary on 9-402 in 23 M.C.L.A. 467. In his article, Professor Steinheimer suggests that if there is a prior filing, the second lender should do one of the following things:
(1) Insist that the record be cleared by the filing of a termination statement under 9-404, or
(2) Enter into a subordination agreement with the first lender which appropriately apportions priorities in the collateral under 9-316.
The controversy arose in this case, as it has in other cases, because K.S.A. 84-9-312(5)(o), as originally adopted, did not have clear and specific language governing the right of a lender to include later advances made in subsequent transactions under the financing statement filed at the time of the original transaction. It should be noted that K.S.A. 84-9-204(5) provided that “[Obligations covered by a security agreement may include future advances or other value whether or not the advances or value are given pursuant to commitment.”
The issue as to the priority of the security interest of a lender, who made advances after the filing of the original financing statement, over the security interest of an intervening creditor came before a Rhode Island superior court in Coin-O-Matic Service Co. v. Rhode Island Hospital Trust Co., 3 U.C.C. Rptr. Serv. 1112 (R.I. Super. Ct. 1966). The district court in the present case relied upon Coin-O-Matic in holding that the security interest of Cheney Investment was prior to the security interest of Allis-Chalmers. In Coin-O-Matic, the debtor gave a security interest in an automobile to the seller, who assigned the debt to Rhode Island Hospital Trust Company which filed a financing statement. One year later, the debtor gave Coin-O-Matic a security interest. It filed a financing statement. The following month, Rhode Island Hospital Trust Company loaned the debtor an additional sum of money, one-third of which was used to pay off the first note to Rhode Island Hospital Trust Company. The first note was cancelled, a new security agreement executed, and a new financing statement filed. When the debtor went into bankruptcy, both Coin-O-Matic Service Company and Rhode Island Hospital Trust Company claimed a prior security interest in the automobile. Rhode Island Hospital Trust Company argued that the first financing statement was sufficient to protect the second contract, as it effectively put the whole world on notice that the collateral was subject to present and future security interests in favor of the filing party. This argument was rejected by the Rhode Island superior court. The Coin-O-Matic court first recognized that giving the first-to-file priority in all subsequent transactions placed the lender in an unusually strong position. The court reasoned that, under such a holding, the debtor would be precluded from obtaining a second loan, evén to pay off the first, because subsequent lenders would be reluctant to lend money based on the collateral already mortgaged, as their security interest would always be subject to preemption by a subsequent security agreement in favor of the first creditor. The court stated that to construe the UCC to give the first lender an interest in collateral for future advances, absent future advance provisions in the security agreement, would render information obtained under 9-204 irrelevant. The court noted that the first creditor could easily protect future advances by including a future advance provision as authorized by 9-204(5).
The ultimate conclusion in Coin-O-Maticwas that a reasonable interpretation of 9-312(5)(a) should be that a “single financing statement in connection with a security agreement when no provision is made for future advances is not an umbrella for future advances based upon new security agreements, notwithstanding the fact that involved is the same collateral.” (3 U.C.C. Rptr. Serv. at 11201.) This portion of the decision in Coin-OMatic caused controversy and widespread criticism of the rule announced therein.
The holding in Coin-O-Matic, requiring a future advance clause in the original security instrument in order for future advances to have 9-312 priority, has been rejected by the vast majority of the jurisdictions in subsequent cases. In rejecting Coin-O-Matic, those courts generally stress the “notice” or “red flag” function of the code and hold that a financing statement on file is notice to the entire world of present or future security interests in the collateral. Cases taking this approach which are contrary to the rule of Coin-O-Matic are the following: In re Rivet, 299 F. Supp. 374; First Nat. Bank & T. Co. of Vinita, Okl. v. Atlas Credit Corp., 417 F.2d 1081 (10th Cir. 1969); James Talcott, Inc. v. Franklin National Bank, 292 Minn. 277, 194 N.W.2d 775 (1972); In re Wilson, 13 U.C.C. Rptr. Serv. 1195 (E.D. Tenn. 1973); In re Gilchrist Company, 403 F. Supp. 197 (E.D. Pa. 1975); Index Store Fixture Co. v. Farmers’ Trust Co., 536 S.W.2d 902 (Mo. App. 1976); Thorp Finance v. Ken Hodgins, 73 Mich. App. 428, 251 N.W.2d 614 (1977); Matter of Gruder, 89 Misc. 2d 477, 392 N.Y.S.2d 203 (1977); Genn v. CIT Corp., 40 Md. App. 516, 392 A.2d 1135 (1978); Chrysler Credit Corp. v. Community Banking Co., 35 Conn. Supp. 73, 395 A.2d 727 (1978).
The rationale found in James Talcott, Inc. v. Franklin National Bank, 292 Minn. at 290-292, well illustrates the approach taken by those courts which have rejected the rule adopted in Coin-OMatic:
“Even where the parties originally contemplate a single debt, secured by a single item of property or a single group of items, the secured party and the debtor may enter into further transactions whereby the debtor obtains additional credit and the secured party is granted more security. The validity of such arrangements as against creditors, trustees in bankruptcy, and other secured parties has been widely recognized by many courts. See, DuBay v. Williams, 417 F.2d 1277 (9 Cir. 1969); Grain Merchants of Indiana, Inc. v. Union Bank & Sav. Co. 408 F.2d 209 (7 Cir.), certiorari denied sub nom. France v. Union Bank & Sav. Co. 396 U.S. 827, 90 S.Ct. 75, 24 L. ed 2d 78 (1969); Rosenberg v. Rudnick, 262 F. Supp. 635 (D. Mass. 1967).
“Using future-advance clauses and using after-acquired property clauses in the original security agreement are not the only means by which perfected security interests can be obtained in subsequently contracted obligations or in goods the debtor may later come to own. There is nothing exclusive about § 336.9 — 204(3, 5). Parties may use future-advance and after-acquired clauses, and they are a great convenience. But, if they are not used, there is nothing in the code which prevents the parties from accomplishing the same result by entering into one or more additional security agreements.
“. . . The better view holds that, where originally a security agreement is executed, an indebtedness created, and a financing statement describing the collateral filed, followed at a later date by another advance made pursuant to a subsequent security agreement covering the same collateral, the lender has a perfected security interest in the collateral not only for the original debt but also for the later advance.”
Matter of Gruder, 89 Misc. 2d at 481, reached the same result, quoting White & Summers, U.C.C. HB, § 25-4 at p. 908, as follows:
“We reject the Coin-O-Matic holding for three reasons. First, it provides little protection against overreaching, for a creditor can avoid the holding simply by including a future advance clause in his security agreement. Second, we suspect that the Coin-O-Matic court misunderstands commercial practice. We suspect that it is a rare banker who will lend against the same collateral which secures a prior loan; in our experience the commercial practice is for the second lender to pay off the first and so take a first priority as to all of the collateral. Finally, Coin-O-Matic conflicts with the most obvious and we think intended meaning of 9-312(5)(a); if the draftsmen had wished to qualify the rule as the Coin-O-Matic court did, they could have done so.”
The only case supporting Coin-O-Matic called to our attention is Texas Kenworth v. First Nat. Bank of Bethany, 564 P.2d 222 (Okla. 1977). We have concluded that the district court in this case was not justified in relying upon the decision in Coin-O-Matic. The rule of Coin-O-Matic was immediately rejected by the UCC permanent editorial board. It conceded that under the 1962 code, as originally adopted, the position of an intervening creditor in reference to a subsequent advance by an earlier secured party was debatable. In order to clarify the matter, the editorial board suggested an amendment to 9-312 by the addition of a new subsection (7) which was subsequently adopted in various states. Subsection (7) was adopted by the Kansas legislature by amendment of K.S.A. 84-9-312 in 1975, effective January 1, 1976. The new subsection (7) may be found at K.S.A. 1979 Supp. 84-9-312(7) and is as follows:
“(7) If future advances are made while a security interest is perfected by filing or the taking of possession, the security interest has the same priority for the purposes of subsection (5) with respect to the future advances as it does with respect to the first advance. If a commitment is made before or while the security interest is so perfected, the security interest has the same priority with respect to advances made pursuant thereto. In other cases a perfected security interest has priority from the date the advance is made.”
The issue has clearly been laid to rest in Kansas by the adoption of the new subsection (7) of K.S.A. 1979 Supp. 84-9-312 by the Kansas legislature in 1975. We note the official UCC comment to that section which is printed in the 1979 Supp. at p. 64, and which states as follows:
“7. The application of the priority rules to future advances is complicated. In general, since any secured party must operate in reference to the Code’s system of notice, he takes subject to future advances under a priority security interest while it is perfected through filing or possession, whether the advances are committed or non-committed, and to any advances subsequently made ‘pursuant to commitment’ (Section 9-105) during that period.”
Comment (7) is followed by example 5, which sets forth a hypothetical factual situation involving a question of priority which essentially presents the same issue to be decided in this case. It states:
“Example 5. On February 1 A makes an advance against machinery in the debtor’s possession and files his financing statement. On March 1 B makes an advance against the same machinery and files his financing statement. On April 1 A makes a further advance, under the original security agreement, against the same machinery (which is covered by the original financing statement and thus perfected when made). A has priority over B both as to the February 1 and as to the April 1 advance and it makes no difference whether or not A knows of B’s intervening advance when he makes his second advance.
“A wins, as to the April 1 advance, because he first filed even though B’s interest attached, and indeed was perfected, before the April 1 advance. The same rule would apply if either A or B had perfected through possession. Section 9-204(3) and the Comment thereto should be consulted for the validation of future advances.
“The same result would be reached even though A’s April 1 advance was not under the original security agreement, but was under a new security agreement under A’s same financing statement or during the continuation of A’s possession.”
Also note should be taken of the official UCC comment to K.S.A. 1978 Supp. 84-9-402, which states on p. 75 of the 1979 Supp. as follows:
“However, even in the case of filings that do not necessarily involve a series of transactions the financing statement is effective to encompass transactions under a security agreement not in existence and not contemplated at the time the notice was filed, if the description of collateral in the financing statement is broad enough to encompass them. Similarly, the financing statement is valid to cover after-acquired property and future advances under security agreements whether or not mentioned in the financing statement.”
It is clear that subsection (7) was adopted by the Kansas legislature to make it clear that K.S.A. 84-9-312(5)(a) should be applied to future advances made by the first creditor, whether such advances are “committed” or “noncommitted” thus making it immaterial whether or not there was a future advance provision in the original security agreement. We regard this amendment as a clarification of the original intent of the legislature when it adopted the Uniform Commercial Code in 1965.
On the basis of the reasoning set forth above, we hold that the security interest of Allis-Chalmers in combine G-7754 is prior and superior to the security interest of the defendant, Cheney Investment, Inc. Under the undisputed facts, the proceeds from the sale of the Allis-Chalmers combine G-7754 totaled $8,650. At the time the suit was filed, Catlin’s indebtedness to Allis-Chalmers was in the total amount of $8,650 plus interest. Since the security interest of Allis-Chalmers equals or exceeds the amount of the net proceeds received from the sale of the combine, after expenses of sale, Allis-Chalmers is entitled to apply the net proceeds to its debt.
The judgment of the district court is reversed and the case is remanded to the district court with directions to enter judgment in favor of the plaintiff Allis-Chalmers, awarding it the net proceeds from the sale of combine G-7754, after deducting the expenses of sale, together with interest as allowed by law and for the costs of the action. | [
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The opinion of the court was delivered by
Fromme, J.:
Blue Cross and Blue Shield of Kansas (BCBSK) commenced an action in the Shawnee County District Court against Fletcher Bell, Commissioner of Insurance, of Kansas (Commissioner), as provided for in K.S.A. 40-1806 and 40-1906 to seek review of an order of the Commissioner denying all requests for an increase in rates for the year 1979 requested by BCBSK. In addition BCBSK sought a declaratory judgment under K.S.A. 60-1701 et seq.
The parties on appeal to this court indicate this action is the first of its kind under K.S.A. 40-1806 and 40-1906. It may be helpful to give some details and background. K.S.A. 40-1801 et seq., provides for the organization of mutual nonprofit hospital service corporations such as Blue Cross of Kansas. K.S.A. 40-1901 et seq., provides for the organization of mutual nonprofit medical service corporations such as Blue Shield of Kansas. Although these are separate corporations organized under separate statutes, the corresponding sections of the statutes contain almost identical provisions governing the organization and control of each corporation.
Kansas Blue Cross began operations in 1941 and sold its first contract in 1942. Kansas Blue Shield began operations in 1945 and sold its first contract in 1946. Both Blue Cross and Blue Shield belong to a national Blue Cross-Blue Shield organization that establishes standards that all plans must meet to be authorized to use the Blue Cross and Blue Shield names and logo. There are 75 Blue Cross plans and 70 Blue Shield plans across the country.
The business and affairs of Blue Cross of Kansas are conducted and managed by a 37-member board of directors that serves without salary or compensation. Nine members are administrators or trustees of Kansas hospitals, nine are physicians and 19 are members of the public. The business and affairs of Blue Shield of Kansas are managed and conducted by a 50-member board of directors that also serves without salary or compensation. Twenty-four members are physicians, one is a dentist and 25 are members of the public. Although Blue Cross and Blue Shield are separate corporations, the plans are administered by a single staff of approximately 1200 employees.
At the present time Blue Cross and Blue Shield serve approximately 51% of the Kansas population, a percentage figure well aboye that of most plans across the country. Both Blue Cross and Blue Shield provide service benefits rather than indemnity benefits. In other words, Blue Cross and Blue Shield enter into contracts with health care providers pursuant to specific statutory authority (K.S.A. 1979 Supp. 40-1803 and 40-1903). The contracts require that the providers accept payment from Blue Cross or Blue Shield as full payment for services rendered to subscribers. The providers are prohibited from charging additional fees to subscribers for covered services. Nothing in either enabling act requires hospitals or physicians, generally referred to as providers, to contract with Blue Cross or Blue Shield. Therefore, the contracts must contain terms that are mutually acceptable to both sides. The percentage of participation by Kansas providers is among the highest in the country. Ninety-four percent of Kansas physicians are Blue Shield participants. One hundred percent of Kansas hospitals are Blue Cross participants. The high level of provider participation provides protection to subscribers by giving them assurance as to the predictability of health care expenses; subscribers know that they will not receive bills for covered fees over and above the amount Blue Cross-Blue Shield has paid.
When these two nonprofit corporations were first organized the law governing rates to be charged, L. 1941, ch. 259, § 6 and L. 1945, ch. 216, § 6, placed no control over rates with the Commissioner. In 1970 the legislature changed this and required that rates be filed with and approved by the Commissioner. L. 1970, ch. 182, §§ 1, 2. Nothing was said in this law as to the procedure or guidelines to be followed. As to Blue Cross the statute merely provided: “The rates charged by any such corporation shall be filed with and approved by the insurance department.” As to Blue Shield, the law provided: “Subscription charges fixed by any such corporation shall be filed with and approved by the insurance department.” Under these prior laws rates were set by the boards of directors of the corporations. Approval by the Commissioner came as a matter of course.
Then L. 1972, ch. 185, §§ 1, 2 were passed by the Kansas Legislature and became effective. K.S.A. 40-1806 and 40-1906. In summary these statutes require the corporations to file their rates with the Commissioner. These statutes further provide that any filing shall be approved by the Commissioner “unless he finds that such filing does not meet the requirements of this act or establishes an unreasonable, excessive or unfairly discriminatory rate.” In the event the Commissioner disapproves a filing, “he shall specify in what respect he finds such filing does not meet the requirements” of K.S.A. 40-1806 or 40-1906.
Corporations have 30 days from the date of any disapproval to request a hearing. Both statutes provide:
“All rates, filed pursuant to this section, shall be made in accordance with the following provisions: (a) Due consideration shall be given to (1) past and prospective loss experience; (2) past and prospective expenses; (3) adequate contingency reserves; (4) the provisions of contracts between such corporation and participating hospitals; and (5) all other relevant factors within and without the state;
“(b) Risks may be grouped by classifications for the establishment of rates for individual policies or for group policies;
“(c) Rates shall be reasonable, not excessive and not unfairly discriminatory.” K.S.A. 40-1806 and 40-1906.
These sections go on to provide that nothing in either act is intended to prohibit or discourage reasonable competition or discourage or prohibit uniformity of rates. The Commissioner is authorized to “issue such rules and regulations as are necessary and not inconsistent with” the acts. (None have been issued.) The sections go on to provide for an appeal from the Commissioner’s order. The order of the Commissioner may be set aside in whole or in part “on the ground that said order or action is unlawful or unreasonable.”
Under the 1972 legislative changes in K.S.A. 40-1806 and 40-1906, the Commissioner of Insurance of Kansas has been given authority to examine rate filings of mutual nonprofit hospital and medical service corporations. If a rate filing does not meet the statutory requirements of the act or if it establishes an unreasonable, excessive or unfairly discriminatory rate the Commissioner may disapprove the rates. Disapproval must be in writing. On disapproval the Commissioner is required to specify in what respect he finds such filing does not meet the requirements of the statutes. The purpose of this is to enable a corporation to correct any oversight or deficiency in a filing, and thereby obtain any necessary change in its rates with a minimum loss of time and expense.
A company cannot correct a filing without knowing what specific things need changing to gain the approval of the Commissioner. Of course, if the changes required by the Commissioner are unlawful or unreasonable, the corporation’s only recourse is to appeal to the court.
Now let us turn to the facts of the present case..In August 1978, BCBSK filed proposed 1979 rates, previously approved by their two boards, together with the documents and information required by K.S.A. 40-1806 and K.S.A. 40-1906 to support the filings. The percentage increase requested varied from classification to classification. For all classifications combined Blue Cross sought a rate increase of $13,048,000.00 or approximately 8%. Blue Shield sought a rate increase of $8,892,000.00, or approximately 7.5%. Within 30 days the Commissioner disapproved these filings and requested certain additional information which was thereafter provided by BCBSK. Then, in 21 letters dated October 3, 1978, the defendant Commissioner disapproved all 21 rate filings and in each instance justified disapproval by merely reciting language from the statutes.
On October 11, 1978, the plaintiffs requested a hearing pursuant to K.S.A. 40-1806 and 40-1906. The hearing was held by the Commissioner’s staff on October 30 through November 1, 1978. Evidence was presented by BCBSK in support of the proposed 1979 rates. Evidence was presented by attorneys and other staff members employed by the Commissioner in opposition to the rate increases. On November 22, 1978, the defendant again disapproved all 21 proposed rates for 1979.
The 21 proposed rate increases related to various risk classifications that have been developed by BCBSK over the years. The initial policies in 1942 and 1945 were issued under a uniform rate for all classes of people. However, certain classifications developed a higher utilization rate than others. Thus, with the passage of time and with the increase in competition from commercial insurance companies BCBSK found that it was necessary to rate by risk in order to meet the competition.
The proposed rate increases also reflect a determination by the Blue Cross and Blue Shield boards that one group of subscribers should not be subsidized by another group by paying a rate that does not cover all claims and expenses related to that group. A portion of the total operating expenses of the two plans was allocated to each classification. The Commissioner, in fact, specifically found that BCBSK “have allocated loss and expense experience to Plan 65, community rated classifications, and the other classifications in a manner designed to make the rates for such classifications self-sustaining.” Plan 65 coverage is that which is issued to individuals covered by Medicare and Medicaid programs and is complementary to the benefits available under those programs. Community rating means that the experience of all groups of less than 25 individuals in all Kansas counties is pooled and a rate developed from that pooled experience.
In previous years BCBSK submitted rate filings for Plan 65 and community rated groups that were not developed on a self-sustaining basis. BCBSK are in the same market as commercial health insurance companies and their rates and benefits must be competitive. Because of that, each board of directors determined that each category of membership should be self-sustaining and the categories that had not in the past paid their own way should no longer be subsidized by other subscribers. The Commissioner, however, took exception with that methodology as to Plan 65 and the community-rated classifications.
Also included in the rate filings was a factor to increase the contingency reserves for each of the plans. Contingency reserves are an amount of money measured in terms of months that BCBSK could continue to pay claims and operating expenses if there were no additional income. Reserves are necessary to compensate for such factors as an underestimation of claims and to keep the plans in sound financial condition. The national membership standard for both Blue Cross and Blue Shield requires a contingency reserve equal to three months of claims and operating expenses. Seven or eight of the plans in this part of the country in the past had a three-month contingency reserve. Two or three plans traditionally maintain a three-month contingency reserve.
The Blue Cross and Blue Shield boards determined, as a management decision, that additional contingency reserves were required to ensure the solvency and financial stability of the plans. Included in the rate applications for 1979 were factors which, at the end of said year, would have made a projected reserve of 2.34 months of claims and operating expenses for Blue Cross and 1.45 months for Blue Shield. Without the proposed increase the contingency reserve of Blue Shield was projected to drop to .6 months. The Commissioner determined that the contingency reserve levels projected by Blue Cross-Blue Shield were adequate without a rate increase.
The Commissioner also determined that the proposed rates were unreasonable and excessive based in part on administrative expenditures that “are not conservative.” The Commissioner stated that BCBSK’s “philosophy for administrative expenditures for fringe benefits, salary increases, travel allowances, and building improvements has failed to reflect conservative measures.” No particular expenditure is identified in the order. The Commissioner also stated that in past rate filings Blue Cross-Blue Shield relied upon accelerated depreciation that “has caused administrative expenses to be inflated.” But, according to the Commissioner’s testimony presented at the hearing, Blue Cross- Blue Shield now utilizes straight-line depreciation in accordance with a suggestion of the Commissioner and the expense figure for depreciation in the rate filings in question was not computed on an accelerated basis.
As previously stated BCBSK made 21 separate filings on different risk classifications asking for increases in rates to be charged on each of the 21 risk classifications. The Commissioner by separate letters disapproved all 21 filings and gave identical reasons for disapproval of each of the 21 filings. The Commissioner stated:
“Such filing does not meet the requirement of K.S.A. 40-1806 [or K.S.A. 40-1906] in the following respects:
“(1) The supporting information submitted does not justify that due consideration was given to the provisions of subsection (a) of the third paragraph of K.S.A. 40-1806;
“(2) The proposed rates are based upon unreasonable and unfairly discriminatory methods of establishment of classes for both individual and group policies.
“(3) The supporting information submitted does not fully contemplate all factors pertinent to the establishment of adequate contingency reserves and thus the filing results in the establishment of unreasonable, excessive and unfairly discriminatory rates;
“(4) The supporting information does not justify that its provisions of contracts between your corporation and participating hospitals contemplate reasonable provisions designed to achieve rates that are not reasonable, not excessive and not unfairly discriminatory.”
The first question to be decided is whether these four conclusory statements were sufficient to comply with the requirements of K.S.A. 40-1806 and K.S.A. 40-1906 which provide:
“In the event the commissioner disapproves a filing, he shall specify in what respect he finds such filing does not meet the requirements of this section . . . .”
The decision of any administrative body should contain a finding of the pertinent facts on which it is based in order for the reviewing court to determine whether the decision reached is reasonable and lawful. Neeley v. Board of Trustees, Policemen’s & Firemen’s Retirement System, 205 Kan. 780, Syl. ¶ 5, 473 P.2d 72 (1970). An administrative agency must assume the responsibility of expressing the basic facts on which it relies with sufficient specificity to convey to the parties, as well as to the court, an adequate statement of the facts which persuaded the agency to arrive at its decision. Thus, there must be findings on all applicable standards which govern the agency’s determination, and the findings must be expressed in language sufficiently definite and certain to constitute a valid basis for the order, otherwise the order cannot stand. Kansas Public Service Co. v. State Corporation Commission, 199 Kan. 736, 744-745, 433 P.2d 572 (1967). Findings of ultimate fact expressed in the language of the applicable statute are not enough in the absence of basic findings to support them. Cities Service Gas Co. v. State Corporation Commission, 201 Kan. 223, 230, 440 P.2d 660 (1968).
Thus, as this court has recognized, one of the purposes for requiring specific findings is to provide a guide to the parties as to the basis for the agency’s decision. That is of obvious importance in a case such as this because the Commissioner’s findings could serve as a precedent for future rate filings and should, therefore, provide adequate guidelines to BCBSK.
The conclusory statements of the Commissioner in disapproving all 21 rate filings were insufficient to comply with the requirements of K.S.A. 40-1806 and K.S.A. 40-1906. Merely finding fault with the rate filings in general terms of the statute is not sufficient. The Commissioner is under an obligation to specify any deficiencies and omissions he finds in the rate filings so as to give the companies some guidelines for future or amended filings. These findings are especially necessary and critical where, as here, the agency has not established agency rules and regulations to assist those who must file rates with the Commissioner. If the Commissioner merely disapproves the filings in the general conclusory terms of the statute, without specifying his reasons, he is not fulfilling his function under these statutes. If this court were to approve this practice it would force the companies to request and conduct a formal rate hearing in every case where a rate filing is disapproved regardless of the nature of the error in such filing. If specific reasons for disapproval are given, the company may then be able to supplement and correct an error or omission in the filing without the loss of time and expense of a formal hearing.
BCBSK contend the Commissioner has no authority to compel them to engage in health cost containment. We disagree. When BCBSK was first organized in 1941 and 1945 the above contention was sound. The statutes merely provided for the rates to be filed and nothing more. Now, however, under the 1972 changes in the law the rates not only must be filed but they must be approved by the Commissioner before they may be put into effect. Certain guidelines are set forth in the statutes to arrive at proper rates. K.S.A. 40-1806 and K.S.A. 40-1906 provide that such rates shall be made in accordance with certain provisions. Due consideration shall be given to (1) past and prospective loss experience; (2) past and prospective expenses; (3) adequate contingency reserves; (4) the provisions of contracts between such corporations and providers of health and medical service care; and (5) all other relevant factors within and without the state. A proper rate must be reasonable, not excessive and not unfairly discriminatory.
Examination of the statutory history of K.S.A. 40-1806 and K.S.A. 40-1906 tends to show a growing concern by the legislature over rising health care costs. K.S.A. 1979 Supp. 40-1811 and 40-1911 of the nonprofit hospital and medical service acts provide for maximum percentages of subscriber’s payments which may be paid during one year for administrative expenses. For Blue Cross the statutory maximum is eight per centum (8%). For Blue Shield the statutory maximum is twelve per centum (12%) of the payments received from subscribers.
The Commissioner has the duty and obligation in rate filings to restrict BCBSK so as to enforce those máximums set by the legislature. In any case where BCBSK have established that they have remained below the statutory máximums it is presumed that their administrative expenses are reasonable. If they exceed the statutory maximums the rate increases sought should be disapproved. In order for the Commissioner to overcome this presumption of reasonableness there must be evidence introduced and he must be able to find therefrom that the administrative expenses are unreasonable and excessive in comparison to the expenses of other hospital and medical service corporations of similar size and delivering the same types of service. In re Rate Filing of Blue Cross Hospital Service, _W. Va. -, 214 S.E.2d 339, 343 (1975). No such evidence was introduced in the present case.
The Commissioner found that the fast depreciation philosophy of BCBSK had caused their expenses to be inflated in 1979 filings. The evidence was that a new addition had been built some years ago to house a necessary increase in employees in the central office in Topeka, that for the first few years thereafter accelerated depreciation had been taken on a declining balance method. However, the Commissioner had complained of this in a past rate filing, a change was then made, and the building was thereafter being depreciated on a straight-line basis. A straight-line basis was used for the period here involved. The findings of the Commissioner clearly establish that the practice of taking fast depreciation had been discontinued. It would appear the former practice would not be relevant in rate filings for 1979 and years subsequent to its discontinuation.
The Commissioner complained that BCBSK were providing pension benefits for their 1200 employees without the employees contributing a percentage toward the pensions, and that salary increases had been given along with liberal travel allowances. The evidence on behalf of the Commissioner indicated that his investigators frowned on certain other practices of BCBSK such as (1) the practice of furnishing coffee to employees, (2) providing a parking lot for employees, and (3) installing a sprinkler system for the grass between the parking lot and the curb. The Commissioner made a finding based on these so-called liberal practices that BCBSK failed to follow “conservative measures consistent with the nonprofit concept” of the companies. He further concluded therefrom that “administrative expenditures which are not conservative are unreasonable and excessive.” We do not agree that this is necessarily true. The conclusion of the Commissioner that any administrative expenditures which are not conservative are unreasonable and excessive is not supported by any relevant evidence. One can hardly equate unreasonableness and excessiveness with providing liberal fringe benefits for employees.
BCBSK argue that the Commissioner has no authority to compel BCBSK to engage in health cost containment. We disagree. In re Rate Filing of Blue Cross Hospital Service, _ W. Va. _, 214 S.E.2d at 344, 345; Matter of Thaler v. Stern, 44 Misc. 2d 278, 253 N.Y.S.2d 622 (1964); Blue Cross v. Insurance Comm’r, 403 Mich. 399, 270 N.W.2d 845 (1978).
BCBSK further argue that if the Commissioner does have such authority he may not refuse a rate increase without finding either that the provider fees are excessive or that BCBSK have failed unreasonably to engage in cost containment. BCBSK state that they must enter into provider contracts with hospitals and physicians as required by K.S.A. 1978 Supp. 40-1803 and 40-1903. Under these statutes, which were in effect when the 1979 rate increase request was filed, BCBSK had no direct control over the fees set by those providers. The subscribers’ contracts covered service benefits for hospital care and other health services. The only statutory limitations on amounts to be paid for these service benefits appear in K.S.A. 1978 Supp. 40-1803(4) and K.S.A. 1978 Supp. 40-1903(4). These amounts are “not to exceed reasonable and customary charges” that a subscriber may incur for these services. However, these are set up as service payments. When charges for health care are incurred and when they do not exceed the reasonable and customary charges set in the providers’ contract they become an obligation of the subscriber and BCBSK and must be paid.
There is an obligation under the statutes for BCBSK in the first instance to determine that the rates the providers charge the subscribers are reasonable, not excessive, and not unfairly discriminatory, and that the service payments made to health care providers be no more than the reasonable and customary charges. Under the written stipulation filed by the parties, cost savings were attained by BCBSK by limitations placed on charges set in provider contracts between BCBSK and their hospital and medical service providers. Through this cost containment practice instituted by BCBSK, subscribers had realized savings of $11,040,600.00 in 1977. This was the last year for which complete figures were available.
The Commissioner adopted a so-called “finding” that BCBSK “have not adequately addressed cost containment provisions” in contracts. The finding was in turn adopted by the district court. This finding is so general in nature it is merely a conclusion. It gives no indication of what was deficient or omitted from the contracts. There are no findings upon which to base this conclusion that BCBSK had failed to address cost containment provisions in provider contracts. The record is devoid of evidence with which to support such a conclusion.
The next question discussed by the contending parties concerns who is to have the final authority to group risks into classifications for the establishment of rates on individual policies and on group policies. The boards of directors of BCBSK approved the group classifications for rate purposes based upon management decisions that one group of subscribers should not, in effect, be required to subsidize another group. One of the high risk groups formerly being subsidized was Plan 65. In the 1979 rate filing BCBSK made the rates for Plan 65 and other groups self-sustaining. This had the effect of raising the rates for those subscribers in high risk groups. The Commissioner objected to making the rates for each group self-sustaining and insisted that other classifications be allocated a part of the claim and operating expense experience of Plan 65, so as to subsidize the costs of the plan at the expense of other groups. Failure to subsidize was found by the Commissioner to result in rates which were unreasonable, excessive or unfairly discriminatory. It appears to us that the opposite might be true.
Many factors go into deciding on the establishment of any group for rate making purposes. From a management position one of the most important factors has to do with maintaining a competitive market position. If a group rate is too high the company is priced out of the market and if the group rate is too low a company may find itself saddled with too large a number of low rate-high risk subscribers. The statutes, K.S.A. 40-1806 and 40-1906, mention certain guidelines in making filings with the Commissioner. Both statutes provide:
“All rates, filed pursuant to this section, shall be made in accordance with the following provisions: (a) Due consideration shall be given to ... .
“(b) Risks may be grouped by classifications for the establishment of rates for individual policies or for group policies;”
This wording in these statutes is directed toward the hospital and medical service corporations, such as BCBSK. The legislature used the permissive word “may” in authorizing such corporations to group risks by classifications. The grouping of risks is a management decision, one which is tied directly to maintaining a competitive market position with other corporations with which they compete for business. The Commissioner should not substitute his judgment for that of the directors of BCBSK when it comes to grouping and classifying risks for the purpose of establishing rates on individual policies or on group policies.
Nonprofit hospital and medical service corporations operate in the area of public service and are subjected to a measure of statutory control in the hands of the Insurance Commissioner. The public service rendered by such health care organizations and the control thereof by the Commissioner is analogous to that of the public common carriers under control of the Kansas Cor poration Commission. A public utility such as a common carrier is required to establish just and reasonable rates that are not discriminatory. K.S.A. 66-107; Jones v. Kansas Gas and Electric Co., 222 Kan. 390, Syl. ¶ 10, 565 P.2d 597 (1977). In Jones it is stated in Syl. ¶ 10, “The touchstone of public utility law is the rule that one class of consumers shall not be burdened with costs created by another class.” The same is true with regard to rates set by nonprofit hospital and medical service corporations. K.S.A. 40-1806(c) and 40-1906(c). In Midwest Gas Users Ass’n v. Kansas Corporation Commission, 3 Kan. App. 2d 376, 391, 595 P.2d 735, rev. denied 226 Kan. 792 (1979), Chief Judge Foth in considering a case involving allocation of costs states:
“If the . . . evidence indisputably demonstrates that a rate structure in fact imposes on one class costs created by another, the rate structure cannot withstand the test of Jones.”
We believe this same philosophy should be applied in fixing rates for different groups of health care subscribers being served by nonprofit hospital and medical service corporations whose filings are subject to the scrutiny and approval of the Insurance Commissioner. In establishing rates for individual or group policies under K.S.A. 40-1806 and 40-1906, risks may be grouped by classifications of health care subscribers and in fixing rates for one class or group such class or group should neither be subsidized nor have to bear part of the burden of subsidizing another group or groups. Cost overlapping may occur and exactness in determining every expense incurred for a particular group may not be feasible or practical; however, the goal should be that one risk group should not be subsidized at the expense of others.
Under K.S.A. 1979 Supp. 40-1809 and 40-1909 BCBSK are made subject to some of the same statutory regulations that insurance corporations are. However, the Insurance Commissioner should keep in mind that neither the general insurance laws nor the laws governing nonprofit hospital and medical service corporations give him authority to govern the everyday management details of BCBSK, or to substitute his judgment for that of the boards of directors of these companies as to either the wisdom and expediency of business policies or the methods of carrying on the business of the companies. 19 Appleman, Insurance Law and Practice § 10394, pp. 74, 75 (1946). See also Hutchins Mut. Ins. Co. v. Hazen, 105 F.2d 53, 57 (D.C. Cir. 1939).
The next question raised on appeal is whether failure to consider group reserves plus the use in this case of a built-in figure for deficiency reserves to increase such reserves to an amount approaching three months of claims and operating expenses would result in authorizing unreasonable, excessive or unfairly discriminatory rates. The Commissioner of Insurance found that it would, based on the conclusions reached by Anthony J. Houghton, an expert witness. However, this witness testified his expertise in the area of business reserves came from his knowledge of the internal operations of ordinary insurance companies, not Blue Cross-Blue Shield plans. He referred to the size of a necessary deficiency reserve in terms of percentages of annual premiums rather than in months of claims and operating expenses. He stated: “I don’t think specifically that 5 percent of the year or 3 months is a required objective for this plan, nor do I believe that a contingency contribution built into rates of 3 percent to 5 percent is necessary to fund for that level or to that level that they do need, but I don’t know a specific number that I would recommend.” The Commissioner introduced no evidence of the amount of deficiency reserves which other Blue Cross-Blue Shield plans were maintaining. So the testimony from the expert who admittedly knew little about BCBS plans and who would not recommend a figure for a proper reserve was somewhat suspect.
On the other hand, BCBSK introduced testimony that they were members of the National Association of Blue Cross-Blue Shield Plans and that use of the BCBS name and logo requires compliance with standards promulgated by the national organization. Those standards require a contingency reserve of three months. Seven or eight plans in this area of the nation traditionally maintain a reserve of three months and several other plans from time to time have been able to do so. When reserves are expressed in terms of months it refers to an amount in dollars sufficient to pay claims and operating expenses during that period if no income were to be received by the plan.
In 1976 the Blue Cross reserve level originally projected before the year began was 1.6 months. The actual reserve level at the end of the year was 1.31 months. In 1977 the reserve level originally projected before the year began was 1.39 months. The actual reserve level at the end of the year was 2.01 months of claims and expenses. In 1978 the reserve level originally projected was 1.23 months and one year later the reserve level projected was 2.08 months. With the increase in rates requested for 1979 the reserve level originally projected for Blue Cross was 2.34 months. This was .66 of a month below the three months required by national membership standards.
For Blue Shield in 1976 the reserve level originally projected was .9 of a month, and the actual reserve level for that year came to .56 of a month. In 1977 the reserve level originally projected was .92 of a month, and the actual reserve level for that year came to 1.15 months. In 1978 the reserve level originally projected was .94 of a month, and the reserve level projected one year later was 1.08 months. With the increase in rates requested for 1979, the projected level of reserves for Blue Shield was 1.45 months, and without the increase it amounted to .57 of a month.
From these historical figures the Commissioner found that BCBSK had underestimated the reserves projected in past filings and that underestimation probably occurred in the 1979 filings. In addition there was evidence that in arriving at the deficiency reserves BCBSK had overlooked or omitted certain group reserves which would increase the reserve levels projected for 1979 by .2 of a month. By adding .2 of a month it would increase the deficiency reserve level projected for Blue Cross for 1979 to 2.54 months, and for Blue Shield for 1979 to 1.65 months.
Considering the entire record on the issue of what is a reasonable level for deficiency reserves, we find that the Commissioner’s witnesses failed to give testimony as to what would be a reasonable level for deficiency reserves. Mr. Houghton merely testified that he did not think five percent of annual premiums of three months of claims and operating expenses would be a required objective for these plans. In addition we find no evidence introduced as to what increases in individual or group rates would result from such increases in deficiency reserves. The only evidence on the issue as to what would be a proper level for deficiency reserves was the evidence of BCBSK. Their testimony established that three months of claims and expenses was a standard reserve required by National Blue Cross-Blue Shield for membership. They introduced additional testimony that other plans in this area were maintaining reserves at that level. After examining the record we conclude the Commissioner’s findings Nos. 22, 23 and 24 as to excessive deficiency reserves are wholly unsupported by the evidence.
Throughout this appeal BCBSK questions the statutory authority of the Commissioner. The Commissioner of Insurance has a statutory duty and authority under K.S.A. 40-1806 and 40-1906 with regard to rate filings of nonprofit hospital and medical service corporations (1) to determine the accuracy of trend projections and the reasonableness of prospective loss experience used in the filings, (2) to consider past and prospective expenses relevant to the filings, (3) to determine what are adequate contingency reserves for these corporations, (4) to consider the provisions of contracts between such corporations and their participating health care providers, and (5) to consider all other relevant factors bearing on rates, to the end that all rates provided for in the filings are reasonable, not excessive and not unfairly discriminatory.
In conclusion we note that the rate filing with which we are here concerned is for rates to be charged subscribers for the year 1979. That period has now passed. Premiums for 1979 have already been paid on the basis of rates approved in prior filings. We understand from statements made during oral arguments that a subsequent rate filing was made, and certain increases of rates were authorized and put into effect. Under these circumstances it would appear to be futile to remand the case to the Commissioner of Insurance to reconsider the 1979 rate filing. Therefore this case must be considered only a declaratory judgment action.
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The opinion of the court was delivered by
Fromme, J.:
Garnishee, an insurance company, appeals from judgments entered against it in a garnishment proceeding. The judgments require it to pay the full amounts of judgments previously entered against one of its policy holders in a tort action. It contends that the policy defense of noncooperation was established, that the plaintiffs had the burden of disproving this policy defense, and that plaintiffs introduced no evidence and thus failed in their burden of proof.
The plaintiffs, who sought and obtained the order of garnishment, have cross-appealed from the disallowance of reasonable attorney fees. They contend the-insurance company refused to pay their claim without just cause or excuse. See K.S.A. 40-256.
We turn to the facts out of which the present controversy arose. The plaintiffs, Earl and Marlene Watson, suffered personal injuries and property damage while making a left turn on Oakland Street in Kansas City, Kansas. Their automobile was hit broadside by an automobile owned and driven by Burley Jones as he was attempting to pass at an intersection in disregard of a turn signal operating on the Watson vehicle. Defendant Jones pled guilty to charges of driving while under the influence of intoxicating liquor, transportation of an open bottle, and possession of untaxed liquor.
The collision occurred on May 16, 1969. Plaintiffs filed suit on May 11, 1971. Summons was issued the following day but was returned unserved. Numerous other attempts to obtain service were unsuccessful until September 15, 1971, when defendant was served at a construction site in Wyandotte County where he was employed. Defendant notified his insurer, Automobile Club Inter-Insurance Exchange (Insurance Exchange), of the suit. Insurance Exchange obtained a statement from defendant as to the facts surrounding the collision.
On October 4, 1971, counsel for Insurance Exchange filed an answer on behalf of defendant raising a defense of the statute of limitations. All manner of discovery concerning the damage claims, including interrogatories, production of wage and tax documents and plaintiffs’ depositions, was completed on behalf of defendant. No notice to take defendant’s deposition was given. On December 15, 1972, Insurance Exchange obtained an affidavit from defendant giving his current address and setting forth his claimed whereabouts during the 127 days between the filing of the petition and the date service was obtained. A counter-affidavit was filed by plaintiff Earl Watson detailing his efforts to locate defendant and indicating that defendant concealed himself during the period of time following the filing of the petition so he could not be served, thus toiling the statute of limitations. See K.S.A. 60-517.
Defendant filed a motion for summary judgment based on the running of the statute of limitations. The motion was overruled on March 9, 1973. At this time counsel for Insurance Exchange decided that defendant’s deposition should be taken. Counsel attempted to locate defendant to obtain his deposition. A letter was mailed to his last known address on November 30, 1973, 15 days before the pretrial conference. At pretrial the case was set for trial on January 21, 1974. No mention of the noncooperation of the defendant was made at the pretrial conference although both parties knew of the difficulties of obtaining service.
After the pretrial conference counsel for the defendant began a flurry of activity for the purpose of locating the defendant. Numerous letters were mailed to him. An investigator was employed by Insurance Exchange in an attempt to locate defendant. The investigator was unable to talk with defendant. Ten days before the trial date Insurance Exchange wrote a letter to defendant at his last known address in an effort to withdraw its insurance coverage and reserve all rights under the policy arising by reason of the noncooperation of the defendant.
Defendant failed to appear on the day of the trial. Evidence of defendant’s negligence was introduced, including guilty pleas to the traffic charges. Testimony was introduced to establish plaintiffs’ pecuniary losses. The lawyers representing Jones and the Insurance Exchange were present. They took part in the trial and cross-examined the plaintiffs’ witnesses. The court entered judgments as follows: $5,227.00 for Earl Watson and $7,507.00 for Marlene Watson, plus costs. The court specifically found that defendant had absconded and concealed himself after the petition was filed and that the action was timely filed. See K.S.A. 60-517.
On February 1, 1974, counsel for Insurance Exchange were permitted to withdraw from the case. No appeal was taken from the judgments. They are now final and no collateral attack upon the judgments can be permitted.
Two and one-half years later plaintiffs sought an order of garnishment to attach any funds due plaintiffs or defendant Jones under the policy of insurance issued by Insurance Exchange and in effect when the collision occurred.
Insurance Exchange, garnishee, denied that it owed money to defendant Jones or to the plaintiffs, asserted that the insurance coverage had been withdrawn for lack of cooperation, and that Insurance Exchange was not liable under the policy for any judgment against Burley Jones.
Plaintiffs filed a reply denying that coverage under the policy was withdrawn, alleging that Insurance Exchange did have the cooperation of Jones, and asserting that Insurance Exchange was estopped from denying coverage and liability because it fully participated in the defense of the tort action which gave rise to the judgments.
At the trial of the garnishment action the plaintiffs relied on the documents, transcript and other papers in the court file to place the burden of proof on the Insurance Exchange as garnishee. See K.S.A. 1979 Supp. 60-718. The garnishee-insurer had pled the policy defense of noncooperation of its assured, Burley Jones. Garnishee moved for a directed verdict in its favor on the ground that plaintiffs had failed to sustain their burden of proof. The motion was overruled. The trial court held the garnishee-insurer had the burden of establishing that Jones breached the cooperation requirements in the policy. The trial court further held that the garnishee-insurer had failed to establish noncooperation and, in addition, that it was estopped from denying liability for the judgments by participating in the tort action. The court denied plaintiffs’ claim for attorney fees.
We turn now to the questions raised on appeal. The insurance policy issued to Burley Jones contained a provision requiring the assured, Burley Jones, to cooperate with the Insurance Exchange “in making settlements, in the conduct of suits and in enforcing any right of contribution.” The trial court placed the burden of proving the policy defense on the insurer. The garnishee-insurer claims this was error, pointing to K.S.A. 1979 Supp. 60-718(c).
This statute in pertinent part provides:
“If the garnishee answers as required herein and . . . [i]f a reply is filed as herein provided, the court shall try the issues joined, the burden being upon the party filing the reply to disprove the sworn statements of the answer, except that the garnishee shall have the burden of proving offsets or indebtedness claimed to be due from the defendant to the garnishee, or liens asserted by the garnishee against property of the defendant.” Emphasis supplied.
Insurance Exchange, the garnishee, was the party filing an answer raising the policy defense of noncooperation. The plaintiffs, judgment creditors of the assured, were the parties who filed a reply joining issue with the answering garnishee. Looking at the literal wording of the statute it would appear the burden is placed generally on the party who files a reply, except when the garnishee has pleaded offsets or indebtedness due from the defendant to the garnishee, or when liens are asserted by the garnishee against the property of the defendant. These exceptions to the general provision for burden of proof are matters of affirmative defense or claims not mentioned in the forms set out in K.S.A. 1979 Supp. 60-718 showing the usual answers and statements to be filed by a garnishee. In our present case the garnishee has not pleaded offsets, indebtedness or liens. It has pleaded no liability under the insurance policy issued to defendant Jones by reason of what is commonly known as a policy defense. As will be shown later, a policy defense is an affirmative defense to be pled and proven by the party asserting it.
When an insurance policy contains a provision relieving the insurer from liability if the assured fails to cooperate in making settlements and in the conduct of suits, an insurer is not liable for a judgment against the assured if the assured has willfully failed and refused to appear and give testimony at trial after receiving adequate notice. However, the insurer is liable for payment of a judgment if the insurer was not sufficiently diligent in its attempts to secure the appearance and testimony of its assured or if the assured’s failure to attend is found to have occurred through lack of timely effort and diligence on the part of the insurer. Jameson v. Farmers Mutual Automobile Ins. Co., 181 Kan. 120, Syl. ¶ 7, 309 P.2d 394 (1957); Anderson v. Lawlor, 27 Ill. App. 3d 150, 326 N.E.2d 529 (1975); Bailey v. Universal Underwriters Ins., 258 Or. 201, 474 P.2d 746 (1970).
The purpose of cooperation clauses is to protect the insurer’s interest and prevent collusion between the insured and the in jured person. To that end, cooperation clauses are subjected to the common and ordinary meaning of the language contained therein, and not to a strained or technical construction. Lack of cooperation is a broad term. It may include fraud or collusion, but may also mean merely a refusal of the insured to do the acts required by the policy. 8 Appleman on Insurance Law and Practice § 4771.
The cooperation provision in the policy issued to Burley Jones provided in pertinent part:
“5. Assistance and Cooperation of the Assured — Parts I and III. The assured shall cooperate with the exchange and, upon the exchange’s request, assist in making settlements, in the conduct of suits and in enforcing any right of contribution or indemnity against any person or organization who may be liable to the assured because of bodily injury, property damage or loss with respect to which insurance is afforded under this policy; and the assured shall attend hearings and trials and assist in securing and giving evidence and obtaining the attendance of witnesses. . . .
“Part IV. After notice of claim under Part IV, the exchange may require the assured to take such action as may be necessary or appropriate to preserve his right to recover damages from any person or organization alleged to be legally responsible for the bodily injury; and in any action against the exchange, the exchange may require the assured to join such person or organization as a party defendant.” Emphasis supplied.
Where an insurer seeks to avoid liability under its policy for failure of the assured to cooperate as required by a condition of the policy, the burden is on the insurer to establish the facts which bring the case within the specified condition in the policy. Jameson v. Farmers Mutual Automobile Ins. Co., 181 Kan. 120; Southards v. Central Plains Ins. Co., 201 Kan. 499, Syl. ¶ 2, 441 P.2d 808 (1968). This rule on burden of proof cited in Southards is quoted with approval in Adventure Line Mfg. Co. Inc. v. Western Casualty & Surety Co., 214 Kan. 820, 822, 522 P.2d 359 (1974), and is generally applied in the trial of insurance lawsuits.
Insurance Exchange argues that the legislature in adopting K.S.A. 1979 Supp. 60-718(c) has changed this general rule as far as garnishment cases are concerned. We cannot agree.
Under the prior law, G.S. 1949, 60-945 and 60-948, the form and content of a garnishee’s answer was set forth, and the statutes provided if the plaintiff served notice on the garnishee taking issue on garnishee’s answer the issues stood for trial as a civil action. The affidavit on the part of the plaintiff was deemed to be the petition and the garnishee’s affidavit was the answer thereto. It appears that prior law was not changed in this respect by the Kansas Code of Civil Procedure effective January 1, 1964. The burden of proving an affirmative policy defense as declared in Jameson was not affected by the adoption of K.S.A. 60-718(c) and amendments.
Other states quite generally have placed the burden of proof of a policy defense on the insurance company-garnishee. Illinois has a garnishment statute which generally places the burden of proof on the party contesting the garnishee’s answer. Ill. Ann. Stat. ch. 62, § 43 (a) (Smith-Hurd 1972). Nevertheless, the burden of proving a policy defense in Illinois is placed on the insurer-garnishee. Ray v. Johnson, 81 Ill. App. 2d 456, 225 N.E.2d 158 (1967); Anderson v. Lawlor, 27 Ill. App. 3d 150. The rationale behind this rule is that a policy defense is in the nature of an affirmative defense which must be pleaded and proven by a preponderance of the evidence by the party urging the same. 38 C.J.S., Garnishment § 228, p. 476.
Therefore, an insurer in asserting a policy defense of noncooperation has the burden of proof to establish noncooperation when garnisheed by a judgment creditor of its assured. The insurer must prove it acted in good faith and attempted to secure the attendance and testimony of its assured at the trial and that the assured’s failure to appear and testify at trial was due to an intentional refusal to cooperate, despite timely and diligent efforts by the insurer.
It follows that the provisions of K.S.A. 1979 Supp. 60-718(c), relating to the burden of proof in contested garnishment proceedings, do not apply to an affirmative policy defense pled by a garnishee insurance company. An affirmative policy defense in such case must be proven by the pleader-garnishee.
The trial court did not err in placing the burden of proof on Insurance Exchange in this case.
Our next question is whether the trial court was correct in holding that Insurance Exchange had failed to maintain its burden of proving the policy defense, noncooperation.
The policy provides that the assured shall cooperate with the insurer and, upon request, assist in the conduct of any suit by attending hearings and trials and by giving evidence. What did the evidence at trial tend to establish? Burley Jones, the assured, promptly got in touch with Insurance Exchange personally and notified the company of the accident. He signed a report form after the accident giving his current address. On December 15, 1972, approximately a year after the answer was filed on behalf of Jones, Insurance Exchange got in touch with Jones and obtained from him an affidavit setting forth his then current address and his claimed whereabouts during the 127 days between the filing of the petition and the service of summons. This affidavit was used in support of the motion for summary judgment based on the statute of limitations. Thereafter until shortly before trial the record fails to disclose any concerted attempts to locate Jones and prepare for trial. It does not appear that Jones ever received or acknowledged notice of the trial setting. During the 30 days preceding the trial Insurance Exchange sent its investigator to locate Jones and, although the investigator located the residence of Jones, he never got to talk with him. Someone at this residence informed the investigator that Jones did not want to talk with the investigator. Approximately 10 days before trial Insurance Exchange mailed a letter to Jones to advise him that the Exchange was withdrawing coverage for his failure to cooperate in the defense of the case. There was no testimony that Jones told his insurer he refused to attend the trial and testify.
Insurance Exchange was present at the trial of the tort claim and defended against the allowance of damages. It had previously attempted and failed in its defense based on the statute of limitations. That defense on motion for summary judgment was heard on affidavits and the record. There was little or no question as to Jones’ liability. The only question concerned the amount of damages.
In entering judgment against the garnishee the trial court reviewed the events leading up to the entry of the judgments in the tort action and stated:
“I hold that whatever lack of cooperation there was on the part of Jones, occurring as it did, and at the time it did, was not justification for the insurance company to withdraw coverage.
“As between the plaintiffs going home empty handed here because the Insurance Company had trouble finding a person to whom they had sold a policy, and the Insurance Company paying a just claim which they had insured against, I have no difficulty whatsoever in ruling for the plaintiffs.
“7. For an insurance company to claim lack of cooperation on the part of its insured, it is incumbent on the company to show it made a reasonable, timely effort to get the cooperation of its insured. I can only characterize the efforts of this garnishee defendant to locate its insured as being too little, too late.
“8.1 hold that the garnishee defendant has not sustained its burden of proof.”
To sustain the policy defense of noncooperation in the present case the insurer had to establish that the assured willfully failed and refused to cooperate by refusing to appear and give testimony at trial after receiving adequate notice of the time and place of the trial. The trial court found the insurer’s efforts to obtain the assured’s presence at the trial were “too little, too late.” By this it would appear the court found the insurer was not sufficiently diligent in attempting to secure the appearance and testimony of its assured and that the assured’s failure to attend the' trial occurred through lack of timely effort and diligence on the part of the insurer in contacting the assured. Lack of cooperation as a policy defense depends upon the facts and circumstances in each case. The question of whether the insurer, seeking to avoid liability under a policy on the ground of the assured’s noncooperation, has exercised reasonable diligence and good faith is ordinarily a question of fact for the jury or the trier of facts and its determination of that issue will not be reversed on appeal if supported by any substantial evidence. Bailey v. Universal Underwriters Ins., 258 Or. at 225.
The trial court did not err in finding from the evidence that the assured’s failure to appear at trial did not constitute noncooperation so as to relieve the insurer-garnishee from liability for the judgments rendered against the assured in the tort action.
In addition to holding that Insurance Exchange failed to establish noncooperation on the part of the assured, the court further held that garnishee defendant was estopped from denying liability to the plaintiffs because it failed to withdraw coverage under the policy until ten days before the tort trial and it thereafter appeared and defended. The theory of estoppel adopted by the court was based upon Henry v. Johnson, 191 Kan. 369, 381 P.2d 538 (1963). Estoppel depends upon the facts and circumstances of each case. We see no purpose in adding unnecessarily to the length of this opinion by discussing the presence or absence of estoppel since the appeal must be affirmed anyway for failure to establish the policy defense.
We turn next to the cross-appeal of the Watsons. They assert the trial court erred in refusing their request for attorney’s fees in the garnishment proceedings. Allowance of attorney’s fees in such cases is permitted under K.S.A. 40-256 when judgment is ren dered against an insurance company which has refused without just cause or excuse to pay the full amount of the loss.
Whether the refusal of an insurance company to pay is without just cause or excuse under this statute is to be determined on the facts and circumstances of each case. The circumstances confronting the insurer when payment of loss is denied determines the question, and the circumstances are to be judged as they would appear to a reasonably prudent man having a duty to investigate in good faith and to determine the true facts of the controversy. Brown v. Continental Casualty Co., 209 Kan. 632, 498 P.2d 26 (1972). Whether there was just cause to refuse payment and therefore justification for denial of attorney’s fees is in the trial court’s sound discretion. Farm Bureau Mutual Ins. Co. v. Carr, 215 Kan. 591, 598, 528 P.2d 134 (1974).
The record is examined with regard to plaintiffs’ claim to recover reasonable attorney’s fees under K.S.A. 40-256 and it is held there existed unresolved questions of fact and an undecided question of law which justified denial of liability under the policy so that the insurer incurred no liability for plaintiffs’ attorney’s fees. The unresolved questions of fact related to proof of noncooperation by the assured. The undecided question of law concerned who has the burden of proving a policy defense in a contested garnishment proceeding.
The judgment is affirmed both on appeal and cross-appeal. | [
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The opinion of the court was delivered by
Herd, J.:
This is an appeal by Unified School District No. 501 (Board) from a trial court’s finding that it had committed a prohibited practice by unilaterally issuing contracts for the 1978-1979 school year prior to the completion of negotiations between the Board and NEA-Topeka, the professional employees organization (Association).
On December 1, 1977, both parties exchanged their proposals for negotiation. Between that date and August, 1978, when the events giving rise to this appeal occurred, the parties negotiated, reached impasse and filed several actions against one another, most of which were eventually appealed to this court. This is the fourth appeal between these parties from trial court rulings regarding contract negotiations for the 1978-1979 school year. The history of the battles and skirmishes between the Board and the Association has been adequately documented in the prior three appeals (NEA-Topeka, Inc. v. U.S.D. No. 501, 227 Kan. 290, 607 P.2d 40 [1980]; NEA-Topeka, Inc. v. U.S.D. No. 501, 225 Kan. 445, 592 P.2d 93 [1979]; In re NEA-Topeka, Inc., 224 Kan. 582, 581 P.2d 1187 [1978]); therefore, we will recite only those facts which directly pertain to this suit.
On August 16, 1978, at its regularly scheduled meeting, the Board adopted a salary proposal for members of the bargaining unit and authorized the district school administration to notify each individual member of the bargaining unit they could if they wished contact the school board office to discuss their individual 1978-1979 employment contracts for signing if they so desired. A memo, dated August 17, 1978, reflecting the Board’s resolution was sent to all members of the bargaining unit. At that time, the negotiations had reached the mediation stage and the mediator had failed to resolve the impasse. Neither the Association nor the Board had filed a request with the Secretary of Human Resources to appoint a fact-finding board to assist in resolving the impasse, pursuant to K.S.A. 1977 Supp. 72-5428. On August 21, 1978, the Association filed a petition against the Board to restrain it from contracting or offering to contract individually with any current member of the bargaining unit or with any new teachers employed to the extent that the offered contract was at variance with the 1977-1978 contract. On August 22, 1978, the trial court granted the temporary restraining order and a hearing was set for the Association’s application for a temporary injunction for August 28, 1978. On August 31, 1978, the trial court issued its findings of fact and conclusions of law. The court granted the Association’s motion for a court order temporarily enjoining the Board from unilaterally contracting or offering to contract with members of the bargaining unit. In addition, the court found that mediation and fact-finding were mandated by the Collective Negotiations Act but not until after the report of the fact-finding committee had been made public, pursuant to K.S.A. 1977 Supp. 72-5428(j), could the Board take such action as it deems in the public interest. That action would include contracting or offering to contract with members of the bargaining unit individually. The court found, however, that the Collective Negotiations Act contemplated that the “board and the association shall meet, confer, consult and discuss in a good faith effort to reach agreement with respect to the terms and conditions of professional service.”
The trial court found that the Board’s offer to contract with members of the bargaining unit and the Board’s unilateral adoption of terms and conditions of professional service for the 1978-1979 school year were prohibited practices, as defined by K.S.A. 1977 Supp. 72-5430(b)(l), (5) and (6). The trial court also. held the Continuing Contract Law, now recognized by this court as encompassing K.S.A. 72-5411 (now 1979 Supp. 72-5411) and K.S.A. 1976 Supp. 72-5437 (now 1979 Supp. 72-5437), (see NEA-Wichita v. U.S.D. No. 259, 225 Kan. 395, 592 P.2d 80 [1979]; Riley County Education Ass’n. v. U.S.D. No. 378, 225 Kan. 385, 592 P.2d 87 [1979]) protected members of the bargaining unit where a new agreement had not been reached between the Board and the Association by the time the next school year had arrived. The court held the negotiated contract from the prior year continued until the adoption of a new agreement between the parties covering terms and conditions of professional service. The Board filed its notice of appeal on August 31, 1978, pursuant to K.S.A. 60-2102(a)(2), (4).
After the decision of the trial court, the parties entered the fact-finding stage of negotiations. A three-member fact-finding panel was appointed to attempt to resolve the impasse. Hearings were held October 30, 31, 1978. At the close of the hearings, the fact-finders’ report was made public and was submitted to the parties for approval. The Association agreed to accept the report in its entirety as the 1978-1979 contract; however, the report was unacceptable to the Board. The Board met and adopted terms and conditions of employment at variance with that report and at variance with the prior year’s contract. Those unilaterally issued contracts were offered to and accepted by members of the bargaining unit as a contract for the 1978-1979 school year.
This case arises from actions occurring during negotiations which were entered into for the purpose of arriving at a professional agreement acceptable to members of the bargaining unit. The negotiations process occurred and, at the close of the fact-finding stage, contracts were properly issued pursuant to K.S.A. 1977 Supp. 72-5428(j). Those contracts were accepted and ratified by the teachers and nothing we can state in this opinion will alter the rights of the parties with respect to that contract. We conclude, therefore, that any questions presented herein are moot. Appellate review is dependent upon the existence of an actual case or controversy, (Thompson v. Kansas City Power & Light Co., 208 Kan. 869, 871, 494 P.2d 1092, cert denied 409 U.S. 944 [1972]), and none is present in a moot case. This court is not statutorily empowered to render advisory opinions. Knowles v. State Board of Education, 219 Kan. 271, 278, 547 P.2d 699 (1976); Thompson v. Kansas City Power & Light Co., 208 Kan. 869. We also find the court is without constitutional authority to render advisory opinions. Such an opinion would go beyond the limits of determining an actual case or controversy and would violate the doctrine of separation of powers. 16 C.J.S., Constitutional Law § 150.
The appeal is dismissed. | [
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The opinion of the court was delivered by
Holmes, J.:
This is an appeal by defendants below from a summary judgment granted plaintiffs by the trial court enjoining the Board of County Commissioners of Leavenworth County and the Board of Zoning Appeals from interfering with plaintiffs’ construction of a dwelling on property used for agricultural purposes.
The facts in the case are not disputed. In 1977, plaintiffs, Henry H. and Mary Ann Blauvelt, purchased forty acres of real property in Leavenworth County which was zoned “R” Rural District by resolutions duly adopted by the county commissioners. Plaintiffs intended to construct a farmhouse and accessory buildings to conduct farming operations on the property. When plaintiffs applied for a permit to build a septic system in connection with the dwelling house, they were informed that they would need a building permit. There is no dispute over the requirement for a permit for the septic system. Their application for a building permit was denied by the zoning authorities because the property did not meet the requirements of the zoning resolutions and regulations. The property did not meet certain frontage require ments and was not a “lot of record.” Plaintiffs appealed the decision to the Board of Zoning Appeals which upheld the zoning administrator’s decision. Plaintiffs then filed this suit in the district court pursuant to K.S.A. 19-2913. After pleadings for both sides were filed, plaintiffs moved for summary judgment, which was granted. Defendants now bring this appeal.
The issue to be decided is whether a dwelling located on a farm occupied by the owner-farmer serves an agricultural purpose and is therefore exempt from county zoning regulations. K.S.A. 19-2901 et seq., authorize the zoning of county property. The issue involves an interpretation of K.S.A. 19-2921, which provides:
“Regulations adopted under authority of this act shall not apply to the existing use of any buildings or land .... but shall apply to any alteration of a building to provide for a change in such use of any building or land after the effective date of any such zoning resolution: Provided, That no determination nor rule nor regulation shall be held to apply to the use of land for agricultural purposes, nor for the erection or maintenance of buildings thereon for such purposes so long as such land and buildings erected thereon are used for agricultural purposes and not otherwise.” (Emphasis added.)
Pursuant to the statutes, Leavenworth County adopted zoning resolutions and regulations. Among the provisions are: (1) agricultural or rural property is zoned “R”; (2) a “lot of record” is defined as a lot which is a part of a subdivision, the map of which has been recorded in the office of the Register of Deeds; (3) every building erected, enlarged or structurally altered must be located on a lot of record; (4) dwellings constructed on such lots are subject to certain front yard setback provisions and are required to front upon a public right-of-way; (5) each such dwelling requires a building permit; and (6) the resolutions and regulations do not apply to land and the buildings located thereon if used for agricultural purposes.
Plaintiffs argued at trial that K.S.A. 19-2921 exempted them from the county zoning requirements and therefore they were not required to obtain a building permit for their house. The county had refused to issue a building permit to plaintiffs because the proposed construction would not be located upon a lot of record. Another requirement was that the lot must have frontage on a public right-of-way. The property upon which plaintiffs intended to construct their house did not meet either of these zoning requirements. The trial court agreed with plaintiffs and held it was clear from the statutes and county regulations that no permit was required and granted a permanent injunction against the defendants.
Defendants asserted then, as they do now, that a house in which a farmer resides is residential, does not serve an agricultural purpose and therefore is not within the class of buildings exempted from county zoning regulations under K.S.A. 19-2921. Defendants argue that the use of a house is purely a residential purpose while other structures on a farm, such as barns, silos, pigpens, etc., are used for agricultural purposes. Defendants assert that the lack of cases on point indicates that the distinction between residential and agricultural usage is so clear and apparent that no one has questioned it in court. The opposite argument could just as easily be made on behalf of the plaintiffs. We have found no Kansas cases in point. The zoning cases in which this court has construed the term “agricultural purposes” have all dealt with issues such as that in Carp v. Board of County Commissioners, 190 Kan. 177, 373 P.2d 153 (1962), where a hog feeding operation was found to fall within the term.
In support of defendants’ contention that a farmhouse does not serve an agricultural purpose, they rely on the Illinois case of People v. Husler, 34 Ill. App. 3d 977, 342 N.E.2d 401 (1975). In Husler the defendant was living in a mobile home parked on land zoned for agricultural use. Defendant proposed to live in the mobile home long enough to complete construction of his permanent house. Zoning regulations prohibited mobile homes. After his conviction for a violation of zoning regulations, defendant appealed and alleged that the county lacked authority to prohibit the use of a mobile home on the property because the property was zoned for agricultural use under a statute similar, if not identical, to K.S.A. 19-2921. The Illinois court held that the county’s power to require permits for buildings on agricultural land is only prohibited when the buildings are used for agricultural purposes. The court went on to say that the statute did not exempt a mobile home being used as a residence. It should be noted that the Illinois Appellate Court reversed the conviction on other grounds and devoted only five lines in its opinion to the issue before us. The Husler court’s comments are so brief that their meaning is unclear. The facts in Husler do not state whether the defendant was actually farming the property. It could be that the Illinois Appellate Court’s statement that the mobile home’s use was not agricultural was simply because the defendant was not farming the land in question. Based upon the factual situation before this court we do not find the brief comments of the Illinois court persuasive. There are literally hundreds, if not thousands, of family farms located throughout Kansas and we are sure it would come as quite a shock to most of these good farm people to learn that their homes, many occupied for generations while the family tilled the soil, were not a part of their agriculture operations and were not used for agricultural purposes.
Does K.S.A. 19-2921, under the facts in this case, exclude a farmer’s dwelling house from county zoning regulations? We think so.
“The intent of the legislature must be found from the language of the statute and, when the language used is plain and unambiguous and appropriate to an obvious purpose, the court should follow the intent as expressed by the words used. Rosedale State Bank & Trust Co. v. Stringer, 2 Kan. App. 2d 331, 339, 579 P.2d 158 (1978). Furthermore, it is a basic principle of statutory construction that words in common usage are to be given their natural and ordinary meaning in arriving at the proper construction of a statute. Weight Watchers of Greater Wichita, Inc. v. Secretary of Human Resources, 225 Kan. 534, 537, 592 P.2d 887 (1979). Finally, when a statute is plain and unambiguous the court must give effect to the intention of the legislature as expressed rather than determine what the law should or should not be. Thomas County Taxpayers Ass’n v. Finney, 223 Kan. 434, Syl. ¶ 2, 573 P.2d 1073 (1978).
“In determining legislative intent, courts are not limited to a mere consideration of the language used, but look to the historical background of the enactment, the circumstances attending its passage, the purpose to be accomplished, and the effect the statute may have under the various constructions suggested. Brown v. Keill, 224 Kan. 195, Syl. ¶ 3, 580 P.2d 867 (1978); Boyd v. Barton Transfer & Storage, 2 Kan. App. 2d 425, 580 P.2d 1366, rev. denied 225 Kan. 843 (1978).” Carlson v. Carlson, 4 Kan. App. 2d 63, 65, 602 P.2d 549 (1979). (Emphasis in original.)
The pertinent provisions of the statute have been in effect since 1939. (L. 1939, ch. 164, § 8.) The obvious purpose of the proviso in K.S.A. 19-2921 was to favor agricultural uses and farmers. Since this state’s economy is based largely on the family farm it would appear the intent of the legislature was to spare the farmer from more governmental regulation and not to discourage the development of this state’s farm industry. It would be ludicrous to say that the legislature intended to exempt a farmer conducting a hog feeding operation from county zoning regulations but at the same time require the same farmer to build his house upon a subdivided lot fronting on a public road.
Defendants further argue that county regulation of residential buildings is essential to prevent an uncontrolled outflux of urban workers and dwellers into the surrounding countryside. It is asserted that without this zoning power the counties will be without means to control urban sprawl and the general health, safety, and welfare of the public will suffer. It is also contended they do not have the manpower and funds available to make the necessary investigations to determine whether an applicant applying for a building permit will actually be using the premises for agricultural purposes. Solutions to those problems are not within the province of the court.
We recognize defendants have a legitimate concern with the problems of suburban development and that the same are subject to reasonable regulation within the parameters of K.S.A. 19-2901 et seq. The tract here involved was obviously an agricultural unit and we are not faced with, and do not here decide, questions involving rental units on suburban properties, small tracts with a vegetable garden and a few chickens and the myriad of other situations that might occur. Our decision is limited to the factual situation before us wherein the 40 acres of admitted agricultural land is occupied by the farmer-owner who intends to live and carry on “agricultural purposes” upon the property. In such a situation we cannot say that the home of the farmer is not within the contemplation of “agricultural purposes” as set forth in K.S.A. 19-2921.
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The opinion of the court was delivered by
Prager, J.:
This case involves the constitutionality of tax increment financing of programs designed to redevelop blighted business areas in Kansas cities as authorized by K.S.A. 1977 Supp. 12-1770 et seq. There is no factual dispute. The city of Topeka, by resolution No. 3241, adopted a redevelopment plan for a two-block downtown commercial area. At the same time, the city declared its intent to issue special obligation bonds in the amount of $18,000,000 to finance the redevelopment.
The urban redevelopment act, K.S.A. 1977 Supp. 12-1770 et seq., was enacted by the 1976 legislature. It authorized cities to undertake redevelopment projects in “downtown commercial” areas and to finance such projects through the issuance of special obligation bonds. These bonds are to be repaid from increments in ad valorem property taxes resulting from the redevelopment projects. The act defines “increment” as that amount of ad valorem taxes collected from real property taxes, levied each year within the redevelopment project area, in excess of that amount which is produced from the assessed valuation of such property as of the date the redevelopment plan was adopted (12-1771[e]).
The act further provides that, with the first payment of taxes levied following the date of approval of any redevelopment plan by ordinance, real property taxes received by the county treasurer resulting from taxes levied by and for the benefit of a taxing subdivision on property located within such redevelopment area should be divided and allocated to two separate funds. First, the county treasurer is directed to allocate for general tax purposes all real property taxes collected from that portion of the assessed valuation of real property in the redevelopment area which does not exceed that shown on the assessment roll last equalized prior to the effective date of the ordinance. Second, the county treasurer is directed to allocate any real property taxes produced from that portion of the assessed valuation of real property within the redevelopment project area, in excess of that shown on the assessment roll last equalized prior to the effective date of the ordinance, to a special fund of the city to pay the principal and interest on any special obligation bonds issued by the city for the redevelopment project (K.S.A. 1977 Supp. 12-1775[c]). For the purposes of the act, “taxing subdivisions” include only the county, the city, and a unified school district, the territory or jurisdiction of which includes the redevelopment area (K.S.A. 1977 Supp. 12-1775[o]).
Under K.S.A. 1977 Supp. 12-1775(fo), all tangible taxable property located within a redevelopment project area must be assessed and taxed for ad valorem tax purposes in the same manner that such property would be assessed and taxed if located outside that area. Furthermore, all ad valorem taxes levied on redevelopment property must be paid to and collected by the county treasurer in the same manner as other taxes are paid and collected. It is only the distribution of the taxes collected which has been changed under the statutory scheme. Section 12-1776(c) requires the county assessor of any county in which a redevelopment project is authorized to certify the amount of such increase in assessed valuation of real and personal property within the redevelopment area to the county clerk on or before July first of each year. Thus, as specific property in the redevelopment area is improved, any increase in the assessed valuation of that property is reflected in the yearly certification filed by the county assessor. It is apparent that, under the statutory scheme, the payment of the special obligation bonds, issued by the city, are financed through the increase in ad valorem taxes resulting from the increase in assessed valuation of specific properties brought about by new construction in the redevelopment area; hence, we have tax increment financing.
Following the adoption of the resolution for a redevelopment project by the city of Topeka, but prior to the issuance of bonds, the State, through the attorney general, brought this action in quo warranto to oust the city from the exercise of any powers conferred on it by the redevelopment act. The State challenged the redevelopment act on the following constitutional grounds:
1. The act violates Article 11, Section 5, of the Kansas Constitution which requires a tax levy statute to state the object of the tax and requires the tax proceeds to be applied only to that specified object.
2. The act violates Article 11, Section 1, of the Kansas Constitution because the allocation of a portion of the real property taxes assessed in a redevelopment area to repay the special obligation bonds violates the uniform and equal taxation provisions of that section.
3. The act confers an unconstitutionally broad delegation of power to the city by allowing its governing body to designate a “downtown commercial” area without standards or guidelines.
The district court held the redevelopment act to be unconstitutional under Article 11, Section 5, because the object of that portion of the taxes collected to be used for redevelopment purposes was not specified in each tax levy statute and the result was an improper diversion of tax proceeds for an object not authorized by the levy statute. Having found the redevelopment act unconstitutional for this reason, the district court declined to reach the second and third grounds of unconstitutionality asserted by the attorney general. The city promptly appealed to this court raising the same three issues asserted by the attorney general in the district court. These issues were briefed by the parties, and amicus curiae briefs were filed.
During the pendency of the appeal, the legislature enacted Chapter 52 of the 1979 Session Laws, which amended K.S.A. 1977 Supp. 12-1770 et seq., and 190 separate tax levy statutes. Both parties have requested consideration of the 1979 amendments by this court in its determination of the constitutionality of tax increment financing. The sections of the redevelopment act, as amended in 1979, may be found in K.S.A. 1979 Supp. 12-1770 through 12-1776. 12-1777 through 12-1780 were not amended in 1979 and are not involved on this appeal.
It is obvious that the 1979 amendments were enacted by the legislature to remedy the constitutional defects suggested by the attorney general in district court in this case. For example, the attorney general objected to the term “downtown commercial” areas as an unlawful delegation of legislative authority, because a city governing body was given the power to designate an area as a “downtown commercial” area with no legislative standards or guidelines to control its discretion. The amendments changed the statutory terminology by substituting the term “central business district” for “downtown commercial” areas. Both the city and the attorney general now agree that the term “central business district” has a definite and specific meaning under urban redevelopment law which avoids any claim of unlawful delegation of legislative authority to a city.
The 1979 legislature, in Chapter 52, Laws of 1979, attempted to cure any Article 11, Section 5, violation by amending 190 different tax levy statutes to provide in each statute an additional object of the levy in the following language:
“[A]nd to pay a portion of the principal and interest on bonds issued under the authority of K.S.A. 1978 Supp. 12-1774, and amendments thereto, by cities located in the county.”
The State contends that tax increment financing remains unlawful notwithstanding the 1979 legislative efforts to remedy any constitutional defects. The issues submitted for determination on the appeal are as follows:
1. Whether it is proper for the Supreme Court to consider the 1979 amendments to the redevelopment act in deciding the constitutional issues raised by the attorney general;
2. Whether K.S.A. 1979 Supp. 12-1770 et seq. violates Article 11, Section 5, of the Kansas Constitution;
3. Whether K.S.A. 1979 Supp. 12-1770 et seq. violates the uniform and equal provisions of Article 11, Section 1, of the Kansas Constitution; and
4. Whether the power given to a city governing body to define a “central business district” constitutes an unlawful delegation of legislative power to the city.
We will proceed to consider each of these points separately.
I. In determining the appeal, should the Supreme Court consider the 1979 amendments to K.S.A. 1977 Supp. 12-1770 et seq. and to 190 tax levy statutes in determining the constitutionality of tax increment financing?
Both parties urge us to consider the 1979 amendments. They maintain that the basic constitutional issues exist despite the amendments and public interest requires resolution of these issues now rather than requiring further proceedings in the district court. We agree. The situation is similar to that in Manzanares v. Bell, 214 Kan. 589, 595, 522 P.2d 1291 (1974), where we considered amendments to the Kansas No-Fault Insurance Act passed by the legislature after the case was determined in district court and appealed to this court. As in Manzanares, for us to decline to consider the 1979 amendments would result in another action immediately being filed in the district court with another appeal taken to this court at some future date. We should consider the 1979 amendments because of the great public interest involved and to avoid future litigation. We took a similar position in Dairy Belle, Inc. v. Freeland, 175 Kan. 344, 264 P.2d 894 (1953), and Ash v. Gibson, 145 Kan. 825, 67 P.2d 1101 (1937). Accordingly, the 1979 amendments will be considered in determining the issues raised on this appeal.
II. Does K.S.A. 1979 Supp. 12-1770 et seq. violate Article 11, Section 5, of the Kansas Constitution?
The State contended in district court, and the court agreed, that K.S.A. 1977 Supp. 12-1770 et seq. violates Article 11, Section 5, of the Kansas Constitution which provides as follows:
“§ 5. Object of tax. No tax shall be levied except in pursuance of a law, which shall distinctly state the object of the same; to which object only such tax shall be applied.”
It has been held that the purpose of this constitutional provision is “to prevent the levy of a tax for one purpose and the use of the funds raised thereby for another purpose.” State v. Butler County, 77 Kan. 527, 536, 94 Pac. 1004 (1908). The failure to state the object of the tax in a levy statute has been considered fatal. A.T. & S.F. Rld. Co. v. Woodcock, Treasurer, 18 Kan. 20 (1877); State, ex rel., v. Leavenworth County, 2 Kan. * 61 (1863). Likewise, the diversion of funds to a purpose other than that stated in the levy statute is prohibited by Article 11, Section 5. State, ex rel., v. Saline County Comm’rs, 128 Kan. 437, 440, 278 Pac. 54 (1929); State v. Butler County, 77 Kan. at 536; Smith v. Haney, 73 Kan. 506, 509, 85 Pac. 550 (1906).
As noted above, K.S.A. 1977 Supp. 12-1774 authorized any city to issue special obligation bonds to finance a downtown redevelopment project. Section 12-1775 required any property tax, in excess of that assessed against the property immediately prior to the passage of the ordinance to redevelop the property, to be placed in a special fund of the city to pay the principal and interest on the bonds, as authorized by 12-1774. The redevelopment act, as originally enacted in 1976, did not attempt to amend specific tax levy statutes to include therein, as an additional object, a contribution toward repayment of the special obligation bonds issued by a city to finance a redevelopment project. At the time the redevelopment act was being considered by the legislature in 1976, the then attorney general took the position that such an amendment to all applicable tax levy statutes was necessary in order to meet the requirement of Article 11, Section 5. The legislature declined to follow the suggestions of the attorney general and enacted the redevelopment act without amending individually all applicable tax levy statutes. This failure on the part of the 1976 legislature resulted in the filing of the lawsuit which is now before us.
The district court, in declaring the redevelopment act unconstitutional as in violation of Article 11, Section 5, relied primarily upon National Bank v. Barber, 24 Kan. *534 (1880), which presented a factual situation quite similar to that in this case. In Barber, the statute in question authorized any county or township tax, assessed against railroad property within a township, to be set aside from the general fund and applied to payment of the principal and interest on railroad bonds issued by the township. The statute was a general law, and the legislature made no attempt to amend specific tax levy statutes to provide for the payment of such bonds as an object of the tax. The statute considered by the court in Barber was held to be unconstitutional as an improper diversion of tax funds in violation of Article 11, Section 5, of the Kansas Constitution. We are convinced that Barber is directly in point and that the learned trial court was correct in holding the 1976 redevelopment act, K.S.A. 1977 Supp. 12-1770 et seq. unconstitutional as a violation of Article 11, Section 5, of the Kansas Constitution. On this appeal, however, we are to consider the effect of the 1979 amendments to determine whether or not the constitutional infirmities have been corrected.
As noted earlier, the 1979 legislature sought to cure the constitutional infirmity by amending 190 tax levy statutes to include, as a stated object in each, a contribution toward the repayment of special obligation bonds issued by a city to finance a redevelopment project. The State contends that the specific amendment of 190 tax levy statutes failed to cure the Article 11, Section 5, defect because the legislature failed to amend at least ten tax levy statutes which might be applicable to a certain city under certain circumstances. It is clear to us that, in light of the large number of statutes that were in fact amended, the failure of the legislature to amend ten tax levy statutes can only be attributed to oversight, and not to any attempt to circumvent the constitutional requirements of Article 11, Section 5. We have concluded that if a tax levy statute was overlooked and not amended by the legislature in 1979, the effect is to eliminate the tax increment contribution from tax funds raised under that statute only and it does not affect the constitutional validity of other tax statutes which were properly amended. Any tax levy statute which was inadvertently overlooked by the legislature may be subsequently amended and, after such an amendment becomes effective, tax funds raised thereunder may be allocated toward the payment of special obligation bonds established to finance a particular redevelopment project.
The State in its brief further maintains that the requirements of Article 11, Section 5, are not satisfied because the language of that section precludes more than one object in a particular tax levy statute and, furthermore, that, assuming dual objects are constitutionally permissible, the tax revenues attributable to the increment in value of a redeveloped central business district are unlawfully diverted when allocated to only one of two co-objects of taxation. We find these contentions to be without merit. K.S.A. 1979 Supp. 12-1771(c) requires the increment in ad valorem property taxes resulting from a redevelopment project be placed in a special fund for repayment of the special obligation bonds. 12-1774 provides that special obligation bonds are to be repaid in part from property tax increases as the property is redeveloped. Finally K.S.A. 1979 Supp. 12-1775(c) sets forth, in clear and specific language, a formula for the division of real property taxes collected between the special fund of the city to finance the redevelopment project and the general fund used for the payment of the ordinary and usual activities of the taxing subdivision. It is not probable that taxing officials would wrongfully apportion taxes to the special fund in excess of what has been prescribed by the statutory formula. There is no language in Article 11, Section 5, which precludes a tax levy statute from having more than one object, so long as the legislature establishes a formula for the allocation of tax funds to each of the objects described in the tax levy statute. After a careful consideration of the 1979 amendments to the redevelopment act, we have concluded that the act in its present form is not unconstitutional as a violation of Article 11, Section 5, of the Kansas Constitution.
III. Does K.S.A. 1979 Supp. 12-1770 et seq. violate the uniform and equal provisions of Article 11, Section 1, of the Kansas Constitution?
Article 11, Section 1, of the Kansas Constitution provides in part as follows:
“The legislature shall provide for a uniform and equal rate of assessment and taxation .... All property used exclusively for state, county, municipal . . . purposes, . . . shall be exempted from property taxation.” (1977 Supp.)
The redevelopment act clearly requires any property within a redevelopment area to be assessed and taxed in the same manner as if located outside the area (K.S.A. 1979 Supp. 12-1775[fe]). Section 12-1776(c) requires the county assessor to certify annually any increase in assessed valuation of real property within the redevelopment area on or before July first of each year. Thus the assessed valuation is kept current each year. The amount of assessment in excess of the last assessment prior to the adoption of the city ordinance authorizing redevelopment is to be deposited into the special city fund to pay the principal and interest on the bonds established to pay for the redevelopment project (12-1771[e]; 12-1775[c]).
The State contends that the above statutory provisions violate the uniform and equal provisions of Article 11, Section 1, because property not in the redevelopment district bears a proportionately higher burden than does property located within the redevelopment district. The city of Topeka maintains that there is no “uniform and equal” violation under the Kansas tax increment legislation because redeveloped property is assessed and taxed at the same rate as similar property outside the redevelopment area. It is clear that, under the statutes discussed above, redevelopment property is assessed or valued in exactly the same manner as similar property outside the redevelopment area. Likewise, the tax rate is identical. Thus under K.S.A. 1979 Supp. 12-1770 et seq. there is uniformity in both the valuation and the rate of taxation.
The only possible nonuniformity or inequality would result from the statutory allocation or distribution of the tax money already collected. Article 11, Section 1, does not require uniformity and equality in the distribution of tax money. That constitutional provision only requires the legislature to provide for a uniform and equal rate of assessment and taxation. See Comm’rs of Ottawa Co. v. Nelson, 19 Kan. 234, 237 (1877). This court has consistently limited the scope of the equality and uniformity requirement to the levy and assessment of taxation of property. That constitutional provision has not been made applicable to the distribution or allocation of taxes after they are collected. Kansas City S. Rly. Co. v. Cherokee County Comm’rs, 138 Kan. 534, 537, 27 P.2d 220 (1933); Freedom Township v. Douglas, 99 Kan. 176, 179, 160 Pac. 1147 (1916); Wheeler v. Weightman, 96 Kan. 50, 149 Pac. 977 (1915); Sumner County v. Wellington, 66 Kan. 590, 593, 72 Pac. 216 (1903); In re Page, 60 Kan. 842, 846, 58 Pac. 478 (1899); Elevator Co. v. Stewart, 50 Kan. 378, 383, 32 Pac. 33 (1893); Beebe v. Wells, 37 Kan. 472, 475, 15 Pac. 565 (1887); Hines and others v. The City of Leavenworth and others, 3 Kan. 186 (1865).
The general rule governing the application of “uniform and equal” provisions in various state constitutions is stated as follows in 84 C.J.S., Taxation § 34, p. Ill:
“Constitutional provisions requiring equality and uniformity do not relate to the distribution or application of the revenue derived from taxation, and hence statutes relative to such matters cannot be held invalid as violative of those requirements.”
In support of the general rule, cases are cited holding that no uniform and equal violations arise from the unequal distribution of collected taxes. See for example Griffin v. Anne Arundel County, 25 Md. App. 115, 128, 333 A.2d 612 (1975); Manchester Sav. & Loan Ass’n v. State Tax Commission, 105 N.H. 17, 21, 191 A.2d 529 (1963); Culley v. Pearl River Industrial Comm., 234 Miss. 788, 108 So. 2d 390 (1959).
In Dean v. Coddington, et al., 81 S.D. 140, 143, 131 N.W.2d 700 (1964), it was held that the unequal distribution of ad valorem property taxes collected to support public schools did not violate the uniform and equal requirements when one school district received school funds, and another school district, which supported no public schools, did not. The South Dakota court held the constitutional requirements of uniform and equal taxation were analogous to the equal protection requirements of the Fourteenth Amendment to the United States Constitution. Neither were violated by an unequal distribution of taxes. To the same effect is Hess v. Mullaney, 213 F.2d 635, 15 Alaska 40 (9th Cir.), cert. denied 348 U.S. 836 (1954), which holds that no requirements of uniformity or equal protection of the law limit the power of a legislature in respect to allocation and distribution of public funds.
The State relies in support of its position on Gottlieb v. Milwaukee, 33 Wis. 2d 408, 147 N.W.2d 633 (1967). That case held unconstitutional, for lack of uniformity, an urban redevelopment statute which allowed redevelopment property a partial exemption from local property taxes for a period not exceeding 30 years in exchange for redevelopment of the property in accordance with the city’s plan. The basis for the holding in Gottlieb was that the “freeze” on the assessment was in fact a partial exemption from taxation, prohibited by the uniform and equal requirements of the Wisconsin Constitution. It is clear that the Wisconsin statute involved in Gottlieb is not comparable to the Kansas statute now under consideration. Under the Kansas redevelopment act, redevelopment property is assessed and taxed on an equal basis with similar property not located within the redevelopment area. The redevelopment property itself receives no tax break or exemption. Hence, the present case is distinguishable from Gottlieb.
We have concluded that K.S.A. 1979 Supp. 12-1770 etseq. does not violate the uniform and equal requirements of Article 11, Section 1, of the Kansas Constitution. When the rate of property assessment is uniform throughout a taxing district, the constitutional mandate of uniform and equal taxation has been fulfilled. The distribution of taxes, once collected, is a matter of legislative discretion so long as it is distributed for a valid public purpose.
IV. Does K.S.A. 1979 Supp. 12-1770 et seq., which grants to the governing body of a city the authority to determine and describe the boundaries of the central business district of the city to be included within a redevelopment plan, constitute an unlawful delegation of legislative power?
As noted above, all parties now take the position that the 1979 amendments cured any defects in this regard. We agree with the parties. The 1979 Kansas legislature amended K.S.A. 1977 Supp. 12-1770 through 12-1774 by substituting at various places the term “central business district” for the term “downtown commercial” areas. We hold that the term “central business district” provides to the governing bodies of Kansas cities an adequate standard by which their actions may be reviewed while allowing them to take into account the diverse character and geographies of their individual cities. The term “central business district” is one commonly used by federal agencies in the administration of urban redevelopment and other programs. See 23 U.S.C. § 137 (a); F. Stuart Chapin, and Edward J. Kaiser, Urban Land Use Planning, Chapter 8 at pp. 231-288 (3rd ed. 1979). The term “central business district” is a generally recognized standard by which the actions of local governing bodies may be reviewed in light of the geographic diversity of Kansas communities. We find no unlawful delegation of legislative power.
For the reasons set forth above, we have concluded that the district court correctly determined the original redevelopment statute, K.S.A. 1977 Supp. 12-1770 et seq., tobe unconstitutional as violating Article 11, Section 5, of the Kansas Constitution. We hold, however, that the 1979 amendments now found at K.S.A. 1979 Supp. 12-1770 et seq., together with the amendment of 190 special tax levy statutes corrected that constitutional defect. We further hold that the redevelopment act as amended is not unconstitutional on any other grounds asserted by the attorney general in this case.
It follows that the judgment of the district court is reversed. Judgment is entered in favor of the defendant city denying the State’s petition for a writ of quo warranto and upholding the constitutionality of K.S.A. 1979 Supp. 12-1770 et seq. in accordance with the views expressed in this opinion.
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The opinion of the court was delivered by
Prager, J.:
This appeal involves a controversy between the owner of an insured motor vehicle and his insurance company over the validity of a provision in an insurance policy which excludes uninsured motorist coverage where the insured, without written consent of the company, makes a settlement with any person or organization who may be legally liable for plaintiff’s damages. The essential facts in the case are not in dispute and are as follows: On June 13,1976, the plaintiff-appellant, Thomas E. Benson, was injured in a motor vehicle collision between plaintiff’s motorcycle and an automobile operated by the defendant, Kenny R. Beers. At the time of the accident, Benson was insured by Farmers Insurance Company under an automobile liability insurance policy which included an uninsured motorist endorsement. The insurance policy contained the following exclusion applicable to uninsured motorist coverage:
“EXCLUSIONS
“This policy does not apply . . .
“(1) to damages with respect to which any insured, . . . shall, without written consent of the Company, make any settlement with any person or organization who may be legally liable therefor . . . .”
Following the accident, Benson commenced an action to recover damages from Beers. It appears that Beers had purchased his automobile only the day before the accident occurred and, at the time of the accident, had not yet obtained his own automobile liability insurance coverage. The Beers vehicle had been covered by an insurance policy issued to the previous owner by Casualty Reciprocal Exchange (Casualty). Plaintiff was covered by three separate insurance policies issued by Farmers Insurance Company (Farmers), all of which contained uninsured motorist coverage. Benson filed his petition against Beers to recover damages for his personal injuries on September 28, 1976. Defendant Beers originally retained his own private counsel to represent him in the case. They made a demand upon Casualty to defend Beers in the action. Casualty agreed to defend Beers under a reservation of rights, denying that Beers had any right to liability insurance protection or coverage under the previous owner’s policy. When plaintiff Benson discovered that it was questionable whether Beers had insurance coverage, he made demand upon Farmers under the uninsured motorist provisions of his policy. Thereafter, on motion, Farmers was permitted to intervene in the action to protect its interests.
After Farmers intervened in the action, plaintiff began negotiating a settlement with Beers and Casualty. They agreed to a proposal by which Benson was to receive $10,000 in exchange for a covenant not to sue Casualty. The agreement was entered into between Benson, Beers, and Casualty without the written consent of Farmers. The agreement provided in part as follows:
“1. Casualty Reciprocal Exchange does, with the execution of this agreement, pay the sum of Ten Thousand ($10,000.00) Dollars, receipt of which is hereby acknowledged to Thomas E. Benson. It is agreed and understood by and between the parties hereto that the amount paid ($10,000.00) is not in full satisfaction of the loss sustained by Benson and Benson reserves all rights to seek full recovery as hereinafter provided.
“3. It is agreed by and between Dodson Insurance Group and Casualty Reciprocal Exchange, its successors and assigns, and Thomas E. Benson, that Thomas E. Benson covenants not to sue Casualty Reciprocal Exchange or Dodson Insurance Group, or their successors and assigns, or otherwise attempt to collect any judgment that may be rendered in favor of Thomas E. Benson in the above-referenced case from Dodson Insurance Group or Casualty Reciprocal Exchange. It is further agreed and understood that Thomas E. Benson, by entering into this agreement is not releasing or otherwise waiving a claim he has or may have against Kenny R. Beers and/or Farmers Insurance Company, Inc. It is specifically understood that Dodson Insurance Group and Casualty Reciprocal Exchange have heretofore and does deny any obligation to Kenny R. Beers or Thomas E. Benson under such policies of insurance issued to Marion Andrews in connection with that certain 1973 Pontiac Firebird automobile, which was operated by Kenny R. Beers at the time of the accident involved in the litigation herein and that the payment made herein is by way of strict compromise.
“4. The parties hereto further specifically agree and understand that Thomas E. Benson may continue with his action against Kenny R. Beers described above, and that Kenny R. Beers may proceed to provide a defense for himself in such action, or that a defense may be provided by Farmers Insurance Group. The parties hereto understand and agreed that both the liability and the nature and extent of the injuries to Thomas E. Benson are disputed.
“5. The parties understand and agree that if Thomas E. Benson does elect to proceed against Kenny R. Beers, he may or may not recover a judgment. In the event Thomas E. Benson does recover a judgment against Kenny R. Beers, Thomas E. Benson shall be free thereafter to proceed against Farmers Insurance Company, Inc. or any member of Farmers Insurance Group on any policy issued to Thomas E. Benson or any other Farmers policy which may be found to extend coverage to Kenny R. Beers, seeking to recover damages on the basis that Kenny R. Beers was an uninsured motorist or seeking to determine that Farmers Insurance Company, Inc. is a primary, secondary or co-insurer of Kenny R. Beers, and as such is responsible to pay damages due Thomas E. Benson as a result of the judgment entered against Kenny R. Beers. It is agreed that the payment under paragraph 1 will be a credit on any judgment against Kenny R. Beers.
“6. If in any suit it is determined that Beers is not insured, Kenny R. Beers and Thomas E. Benson expressly understand and agree that Farmers Insurance Company, Inc. may have certain claims to apply the payment under this agreement to any obligation they may have and agree to be bound by any final adjudication of any court in this regard, this question being the proper subject of court adjudication. They further understand and agree that in the event a payment is made to Thomas E. Benson by virtue of an adjudication that Kenny R. Beers is uninsured, Farmers Insurance Company, Inc. has contractual and statutory subrogation rights to the extent of such payments against Kenny R. Beers if he is responsible legally for the damages sustained by Thomas E. Benson occasioning the payment under the uninsured motorist provisions of the Farmers Insurance Company policy. The parties to this agreement specifically ratify and affirm those rights, and this agreement is not intended to nor shall it in any way interfere or affect any rights of Farmers Insurance Company, Inc. not otherwise waived by Farmers Insurance Company, Inc. to subrogation for payments made by them if Kenny R. Beers is uninsured as a result of court adjudication.
“7. It is understood and agreed between the parties hereto that Casualty Reciprocal Exchange and Dodson Insurance Group shall be relieved of any further liability to any of the parties hereto under any insurance coverage or claims of insurance coverage made against them in connection with the accident and action in question . . . .”
It is not clear from the record exactly when this agreement was executed.
Farmers thereafter filed a motion for summary judgment or in the alternative to dismiss on the grounds that the settlement triggered the policy exclusion cited above, since the settlement between Benson, Beers, and Casualty had been entered into without the written consent of Farmers. Farmers maintained that, as a result of the settlement agreement, its subrogation rights had been impaired. The primary issue raised by Farmers’ motion was whether the exclusion clause in the insurance contract between Benson and Farmers applied to such a settlement and thus whether the plaintiff’s entering into the settlement without Farmers’ consent, excluded Farmers’ contingent liability under the policy.
The trial court sustained Farmers’ motion and granted summary judgment in its favor. The court held that the settlement agreement impaired Farmers’ subrogation rights under K.S.A. 40-287 and that the agreement violated the policy terms requiring the insurer’s consent to any settlement with someone who might be liable. Hence, the trial court found that the uninsured motorist coverage under Benson’s insurance policy had been excluded. Benson brought a timely appeal to this court.
The plaintiff first contends that an exclusionary clause in an uninsured motorist policy which prohibits a settlement by the insured without the consent of the company conflicts with the broad insurance coverage mandated by K.S.A. 40-284 and is therefore invalid and unenforceable. The trial court rejected this contention and upheld the validity of the exclusion clause. In its memorandum opinion, the trial court reasoned as follows:
“Uninsured motorist coverage is mandated by statute in Kansas. K.S.A. 40-284 provides:
“ ‘No automobile liability insurance policy covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state, unless the policy contains or has endorsed thereon, a provision with coverage limits not less than the limits for bodily injury or death set forth in K.S.A. 1967 Supp. 8-729, providing for payment of part or all sums which the insured or his legal representative shall be legally entitled to recover as damages from the uninsured owner or operator of the motor vehicle. . . .’
“With respect to the purpose of the statute and its construction, the court has stated:
“ ‘The purpose of legislation mandating the offer of uninsured motorist coverage is to fill the gap inherent in motor vehicle financial responsibility and compulsory insurance legislation and this coverage is intended to provide recompense to innocent persons who are damaged through the wrongful conduct of motorists who, because they are uninsured and are not financially responsible, cannot be made to respond in damages. As remedial legislation it should be liberally construed to provide the intended protection. Winner v. Ratzlaff, 211 Kan. 59, 63-64, 505 P.2d 606 (1973).’
“In light of public policy behind the act requiring such coverage, various policy clauses which purport to condition, limit, or dilute the unqualified uninsured motorist coverage required by the statute, have been declared void by the Kansas Supreme Court. These include: a clause requiring that a judgment first be obtained against the uninsured motorist before permitting recovery from the insurer (Winner v. Ratzlaff, supra); ‘consent to sue,’ ‘other insurance,’ ‘proof of loss,’ ‘medical authorization,’ and ‘furnishing of medical reports’ clauses when operating as condition precedents to enforcement of an uninsured motorist endorsement. (Clayton v. Alliance Mutual Casualty Co., [212 Kan. 640, 512 P.2d 507 (1973)]); and, an exclusionary clause purporting to exclude from coverage an insured person occupying the insured automobile when his injuries were caused by an uninsured operator of an uninsured automobile owned by the named insured (Forrester v. State Farm Mutual Automobile Ins. Co., 213 Kan. 442, 517 P.2d 173 (1973)).
“The common denominator of the above cases can be found in clauses which would prevent the insured from receiving any type of settlement from the insurer. Each case involves a restriction on the insured’s ability to recover without significantly protecting the insurer’s rights under the statute. By law, however, the insurer has subrogation rights against any person who may be liable for the tort committed against the insured. (K.S.A. 40-287). The exclusion clause forbidding settlements without consent is merely designed to protect that right. This enforcement of statutory rights by the use of an exclusionary clause cannot be viewed as contrary to public policy requiring compensation to innocent persons injured by the tortious conduct of an uninsured motorist. To be compensated under the policy, all the insured need do is establish liability of an uninsured motorist. Where, as here, there is a question concerning whether the tortfeasor was insured, the same considerations apply. Once liability has been established, the insurer must pay. The insurer then can, assuming its subrogation rights remain unimpaired, press an action against both the tortfeasor and his purported insurance company to collect the judgment. This procedure allows for both compensation to the innocent tort victim and preservation of the insurance carrier’s subrogation rights.
“In entering the settlement agreement with Casualty, the plaintiff has prevented Fanners from pursuing an action against Casualty. Whether Casualty is in fact the defendant’s insurer is now academic; they are no longer obligated to pay any judgment arising from this action. . . . Thus, this court concludes that the plaintiff’s actions in entering into an unauthorized settlement agreement with the insurance company representing the defendant in this action constitutes a signif icant impairment of Farmers’ rights under the policy and that the exclusion clause examined in this opinion is valid and operates to deny liability under the policy. The determination as to the exclusion clause’s validity applies only to the factual context presented here. It is, of course, possible to hypothesize a situation where the very same clause might well be declared invalid. For example, when such a clause operates to forbid unauthorized settlements with third party tortfeasors or their insurers when the uninsured motorist coverage is not applicable to them.”
Other jurisdictions are split on the validity of policy provisions excluding uninsured motorist coverage for unauthorized settlements. Most courts have upheld such exclusions as protecting the insurer’s legitimate right to subrogation. See, e.g., Castorena v. Employers Casualty Company, 526 S.W.2d 680 (Tex. Civ. App. 1975); LaBove v. American Employers Insurance Company, 189 So. 2d 315 (La. App. 1966); and the many cases cited in the annotation in 25 A.L.R.3d 1275. In other jurisdictions, the exclusion of coverage for unauthorized settlement has been held invalid when applied to settlement with an insured third-party tortfeasor. See, e.g., Government Employees Ins. Co. v. Shara, 137 N.J. Super. 142, 348 A.2d 212 (1975); Hawaiian Ins. & Guar. v. Mead, 14 Wash. App. 43, 538 P.2d 865 (1975); Dairyland Insurance Company v. Lopez, 22 Ariz. App. 309, 526 P.2d 1264 (1974); Harthcock v. State Farm Mutual Automobile Ins. Co., 248 So. 2d 456 (Miss. 1971); and Michigan Mut. Liab. Co. v. Karsten, 13 Mich. App. 46, 163 N.W.2d 670 (1968).
The rationale of the trial court as to the validity of the consent to settlement exclusion is sound and is approved by this court. Where the insurer’s right of subrogation is provided for by statute as in K.S.A. 40-287, the insurer has a legitimate interest to be protected. We have concluded that the exclusion from coverage because of a settlement by the insured without the consent of the insurer is reasonably intended to protect the insurer’s right of subrogation, and is valid and enforceable.
We must next consider whether the exclusion contained in plaintiff’s insurance policy is applicable under the factual circumstances now before us. We have concluded that it is. The settlement in this case was not with a third-party tortfeasor involved in the accident or a settlement which purports to release the uninsured motorist from liability arising out of the accident. Instead, the settlement agreement releases an insurance company from liability without affecting the liability of the uninsured tortfeasor. This unique situation was specifically addressed in Castorena v. Employers Casualty Company, 526 S.W.2d 680, where a suit was brought by an automobile passenger against his own insurer under his policy’s uninsured motorist provision. The passenger had released his driver’s insurer in a settlement for $1,000 without his own insurer’s consent. The Texas Court of Civil Appeals, in interpreting an exclusion provision identical to the one involved here, held that coverage was voided by the unauthorized settlement. The court noted that the insured sought to avoid the exclusion clause by arguing that he settled with the driver’s insurer and not the driver. The court dismissed that argument, observing that although the driver’s liability had not been established, if .it was, the plaintiff’s insurance company would be subrogated to plaintiff’s rights against him. Further, the court noted that the driver’s insurer was obligated to defend and pay within policy limits any judgment against him. Castoreña demonstrates that an impairment of the insurer’s effective ability to collect from the tortfeasor not only results from a release of the tortfeasor, but also from the release of a third party who may be liable by a contract with the tortfeasor. In the present case, Benson agreed to release Casualty from possible liability if the defendant Beers was found responsible for the accident. Thus, Farmers is limited in any attempt to recover payments made under its uninsured motorist provision to the defendant Beers alone. This represents a substantial impairment of Farmers’ rights to subrogation.
The exclusion of uninsured motorist coverage becomes effective when the insured, without written consent of the company, makes any settlement with any person or organization who may be legally liable therefor. This specific language, in an identical policy provision, was interpreted in LaBove v. American Employers Insurance Company, 189 So. 2d at 318, 25 A.L.R.3d 1269 (1966), where it was held that the application of the provision was not restricted to a settlement with the uninsured motorist but also included a settlement with any person who possibly, perhaps, or by chance may be liable. The court in LaBove relied in part on the interpretation of the words “may be” found in State v. Howland, 153 Kan. 352, 360, 110 P.2d 801 (1941). In Howland, it was held that the words “may be” are used as equivalent to possibly, perhaps, or by chance. The language contained in the exclusion in this case is clear and unambiguous. It is part of the contract entered into between Farmers and its insured, Benson. As noted above, this provision is valid and enforceable and binding upon the parties. Since the insured, Benson, made a settlement without the written consent of the company with a person or organization who may be legally liable for plaintiff’s damages, the uninsured motorist coverage under the Farmers’ policy has been excluded, rendering it inapplicable to the injuries suffered by Benson in this case.
Plaintiff next maintains that Farmers, by failing to respond to the plaintiff’s request for a consent to the settlement, waived its right to require its consent to the settlement. The plaintiff in his brief cites authorities which hold that the consent requirement before settlement may be waived by the insurer’s arbitrary and unreasonable refusal to give the required consent. Courson v. Maryland Casualty Company, 475 F.2d 1030 (8th Cir. 1973); Pickering v. American Empl. Ins. Co., 109 R.I. 143, 282 A.2d 584 (1971); Foray v. Royal Globe Ins. Co., 90 N.J. Super. 454, 217 A.2d 916 (1966); and Levy v. American Automobile Ins. Co., 31 Ill. App. 2d 157, 175 N.E.2d 607 (1961). In Tuthill v. State Farm Ins. Co., 19 Ill. App. 3d 491, 311 N.E.2d 770 (1974), the court acknowledged that the insurer should not be allowed to preclude access to the courts by arbitrarily, and without reason, withholding consent to suit or settlement. Withholding consent arbitrarily or without reason was held to constitute a waiver. In determining whether or not the withholding of consent was arbitrary, the test is whether the insurer had the opportunity to participate in the settlement negotiations. See also Sylvest v. Employers Liability Assurance Corp., 252 So. 2d 693 (La. App. 1971), holding that the insurer’s knowledge of the settlement did not alone satisfy the consent requirement. In the case now before us, we have concluded from the record that there is no evidence which required the trial court to find that Farmers acted in any way arbitrarily or unreasonably in refusing to give its consent to the settlement agreement reached in this case. We note that on September 27, 1978, counsel for Farmers filed a written request for production of the settlement agreement entered into by Benson and Casualty Insurance Company. Counsel for the plaintiff objected to the request for production of that agreement. These circumstances support the position of Farmers that plaintiff’s attorney refused to furnish Farmers with a copy of the agreement. In view of this evidence, it is difficult to see how Farmers acted arbitrarily or unreasonably in refusing to give its consent to the settlement agreement.
The judgment of the district court is affirmed. | [
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The opinion of the court was delivered by
Herd, J.:
This appeal is taken upon a question reserved by the State, pursuant to K.S.A. 1978 Supp. 22-3602(i?)(3). At trial, a jury was called upon to determine whether the film “French Blue” and the cartoon “Sine” were obscene, pursuant to K.S.A. 1978 Supp. 21-4301(2)(o). The jury found the defendant guilty of promoting obscenity as to the cartoon and was unable to reach a verdict regarding the film. The State later dismissed charges regarding the film.
The question before this court involves the instructions given at trial. The definition of obscene, pursuant to K.S.A. 1978 Supp. 21-4301(2)(o), is:
“Any material or performance is ‘obscene’ if the average person applying contemporary community standards would find that such material or performance, taken as a whole, appeals to the prurient interest; that the material or performance has patently offensive representations or descriptions of ultimate sexual acts, normal or perverted; and that the material or performance, taken as a whole, lacks serious literary, educational, artistic, political or scientific value.”
The State disputes the instruction given defining the element of prurient interest. The following instruction, an adaptation of PIK Crim. 65.03, was given:
“You must determine whether the film you have seen appeals to a prurient interest in sex. A prurient interest in sex is not the same as a candid, wholesome, or healthy interest in sex. Material does not appeal to the prurient interest just because it deals with sex or shows nude bodies. Prurient interest is an unhealthy, unwholesome, morbid, degrading, and shameful interest in sex, a leering or longing interest in sex. An appeal to the prurient interest is an appeal to sexual desire.”
The State requested, and the trial court refused, the following instruction: “An appeal to the prurient interest in sex is defined as an appeal to sexual desire.” The State contends recent developments in the law of obscenity have changed the definition of prurient interest or prurient appeal to reflect the requested instruction. It should be noted this appeal is concerned only with the phrase “appeal to the prurient interest.” The State does not question the remaining elements in the modern test of obscenity, e.g., “patent offensiveness,” “contemporary community standards,” or “serious literary, artistic, political or scientific value.” Miller v. California, 413 U.S. 15, 24, 37 L.Ed.2d 419, 93 S.Ct. 2607 (1973).
A brief history of the law of obscenity is essential to a discussion of the issues raised in this case. The courts and legislatures have been struggling with the regulation of obscenity for a long period of time. The First Amendment to the United States Constitution provides that Congress shall make no law abridging the freedom of speech or press. The Fourteenth Amendment applied it to the states. In Roth v. United States, 354 U.S. 476, 1 L.Ed.2d 1498, 77 S.Ct. 1304 (1957), a majority of the court held that obscenity is an exception to First Amendment protection. The states are left with the right to regulate obscenity. The difficulty lies in defining the term succinctly enough to prevent invading areas of thought and ideas having redeeming social importance, the dissemination of which is essential to the functioning of a free society. We, therefore, seek a narrow definition.
The Supreme Court in Roth defined obscenity in 1957, and in 1966 attempted to refine the definition in Memoirs v. Massachusetts, 383 U.S. 413, 16 L.Ed.2d 1, 86 S.Ct. 975 (1966). Following these two decisions the Kansas Legislature adopted the guidelines set forth in Roth and Memoirs. In 1973 the Supreme Court again spoke, in Miller v. California, and revised its previous definition of obscenity. This court construed the then existing statute, K.S.A. 21-4301(2)(c)(h)(c) and (3), in State v. Motion Picture Entitled “The Bet”, 219 Kan. 64, 547 P.2d 760 (1976). Thereafter, the Legislature passed a new obscenity statute, K.S.A. 1978 Supp. 21-4301, which is the act before us at this time.
Let us now turn to a detailed analysis of the cases which have defined the term “prurient.” In Roth v. United States, 354 U.S. at 489, the following test for obscenity was adopted:
“[W]hether to the average person, applying contemporary community standards, the dominant theme of the material taken as a whole appeals to prurient interest.”
Prurient interest was defined in Roth at 487, n. 20:
“[MJaterial having a tendency to excite lustful thoughts. Webster’s New International Dictionary (Unabridged, 2d ed., 1949) defines prurient, in pertinent part, as follows:
“ . . longing, uneasy with desire or longing; of persons having . . . morbid, or lascivious longings; of desire, curiosity, or propensity, lewd. . . .’
“Pruriency is defined, in pertinent part, as follows:
“ . . Quality of being prurient; lascivious desire or thought. . . .’
“See also Mutual Film Corp. v. Industrial Comm’n, 236 U.S. 230, 242 [59 L.Ed. 552, 559, 35 S.Ct. 387, Ann. Cas. 1916C 296], where this Court said as to motion pictures: ‘. . . They take their attraction from the general interest, eager and wholesome it may be, in their subjects, but a prurient interest may be excited and appealed to. . . .’ (Emphasis added.)
“We perceive no significant difference between the meaning of obscenity developed in the case law and the definition of the A.L.I., Model Penal Code, § 207.10(2) (Tent Draft No. 6, 1957), viz.:
“ . . A thing is obscene if, considered as a whole, its predominant appeal is to prurient interest, i.e., a shameful or morbid interest in nudity, sex, or excretion, and if it goes substantially beyond customary limits of candor in description or representation of such matters. . . .’ See Comment, id., at 10, and the discussion at page 29 et seq.”
Appéllant argues the definitions within footnote 20 are contradictory and contends the phrase “tendency to excite lustful thoughts” supports its position that an appeal to the prurient interest is an appeal to sexual desire. Appellant also argues the authors of the Model Penal Code distinguished between “lustful thoughts” and “prurient interest.” Model Penal Code § 207.10, Comments, p. 10 (Tent. Draft No. 6, 1957) states:
“We reject the prevailing test of tendency to arouse lustful thoughts or desires because it is unrealistically broad for a society that plainly tolerates a great deal of erotic interest in literature, advertising, and art, and because regulation of thought or desire, unconnected with overt misbehavior, raises the most acute constitutional as well as practical difficulties.”
The Supreme Court, however, found no differences between the meaning of obscenity in prior case law and the definition set forth in the Code. See Roth v. United States, 354 U.S. at 487, n. 20. The “case law” referred to in footnote 20 appears to be listed in footnote 26 at page 489. Each of the cases in footnote 26 defined obscenity in a manner the Supreme Court considered consistent with its interpretation of prurient interest. Those cases and the phrases reflecting their definitions of obscenity are compiled and set forth below.
Walker v. Popenoe, 149 F.2d 511, 512 (D.C. Cir. 1945):
“The standard must be the likelihood that the work will so much arouse the salacity of the reader to whom it is sent as to outweigh any literary, scientific or other merits it may have.”
Accord, United States v. Levine, 83 F.2d 156 (2d Cir. 1936).
Parmelee v. United States, 113 F.2d 729, 736-737 (D.C. Cir. 1940):
“The statute involved in the present case was interpreted in United States v. One Book Entitled Ulysses, and the decision in that case is equally applicable here. Tt is settled,’ says the court in the Ulysses case, ‘that works of physiology, medicine, science, and sex instruction are not within the statute, though to some extent and among some persons they may tend to promote lustful thoughts.’ It should be equally true of works of sociology, as of physiology, medicine and other sciences — to say nothing of general literature and the arts — that ‘where the presentation, when viewed objectively, is sincere, and the erotic matter is not introduced to promote lust and does not furnish the dominant note of the publication,’ the same immunity should apply. “. . . The determining question is, in each case, whether a publication, taken as a whole, has a libidinous effect.”
In United States v. Dennett, 39 F.2d 564, 568 (2d Cir. 1930), the court used some confusing language regarding arousal of sexual impulses and lustful thoughts, but concluded that:
“[T]he test most frequently laid down seems to have been whether it would tend to deprave the morals of those into whose hands the publication might fall by suggesting lewd thoughts and exciting sensual desires.”
Khan v. Leo Feist, Inc., 70 F. Supp. 450, 458 (S.D.N.Y. 1947):
“ ‘The question in each case is whether a publication taken as a whole has libidinous effect.’ ”
Amer. Civil Liberties Union v. Chicago, 3 Ill. 2d 334, 347, 121 N.E.2d 585 (1954):
“We hold, therefore, that a motion picture is obscene ... if, when considered as a whole, its calculated purpose or dominant effect is substantially to arouse sexual desires, and if the probability of this effect is so great as to outweigh whatever artistic or other merits the film may possess.”
Commonwealth v. Isenstadt, 318 Mass. 543, 549-550 62 N.E.2d 840 (1945):
“A book is ‘obscene, indecent or impure’ within the statutory prohibition if it has a substantial tendency to deprave or corrupt its readers by inciting lascivious thoughts or arousing lustful desire.”
State v. Becker, 364 Mo. 1079, 1084-1085, 272 S.W.2d 283 (1954):
“After applying the required tests all the members of this Court have concluded that the contents of these publications tend to incite lascivious thoughts, arouse lustful desire, encourage breaches of the law, and promote and encourage commission of crime, law violation and moral decay.”
At pages 1086-1087 the court went on to find the synonomous terms of indecent, immoral and scandalous, used in the statute with obscene, lewd, licentious and lascivious, “are not words of hidden or obscure or uncertain meaning.” They are not “technical terms of the law.”
“The word ‘indecent’ is a common word of common understanding. It has been defined to mean unfit to be seen or heard; immodest; gross; obscene; offending against modesty and less than immodest; that which would arouse lewd or lascivious thoughts in the susceptible. [Citations omitted.] The word ‘immoral’ is likewise a word of common understanding. It means hostile to the welfare of the general public; morally evil, impure, vicious or dissolute; licentious misconduct. [Citations omitted.] The word ‘scandalous’ as used in the statute in connection with the words ‘obscene, lewd, licentious, lascivious, immoral’ means shocking to decency or propriety, offensive, disreputable. Webster gives as synonyms of ‘scandalous,’ the words detestable, base, vile, shameful.”
Adams Theatre Co. v. Keenan, 12 N.J. 267, 272, 96 A.2d 519 (1953):
“The question is whether the dominant note of the presentation is erotic allurement ‘tending to excite lustful and lecherous desire,’ dirt for dirt’s sake only, smut and inartistic filth, with no evident purpose but ‘to counsel or invite to vice or voluptuousness.’ ”
Commonwealth v. Feigenbaum et al., 166 Pa. Super. Ct. 120, 122, 70 A.2d 389 (1950):
“[Obscene works] have the effect of inciting to lewdness, or of inciting to any sexual crime, or that they are sexually impure and pornographic, i.e. ‘dirt for dirt’s sake.’ ”
Roth v. Goldman, 172 F.2d 788, 792 (2d Cir. 1949):
“I think that no sane man thinks socially dangerous the arousing of normal sexual desires. Consequently, if reading obscene books has merely that consequence, Congress, it would seem, can constitutionally no more suppress such books than it can prevent the mailing of many other objects, such as perfumes, for example, which notoriously produce that result. But the constitutional power to suppress obscene publications might well exist if there were ample reason to believe that reading them conduces to socially harmful sexual conduct on the part of normal human beings.”
The courts stated a work is obscene if it has “socially undesirable effects on normal readers.” Roth v. Goldman at 795.
In Bantam Books, Inc. v. Melko, 25 N.J. Super 292, 96 A.2d 47 (1953), the court discussed a variety of cases in different jurisdictions and appeared to adopt the test set forth in United States v. One Book Entitled Ulysses, 72 F.2d 705 (2d Cir. 1934), and United States v. Levine, 83 F.2d 156.
It is clear to this court that this compilation of cases reflects a definition of prurient interest that goes far beyond a mere arousal of sexual desire. The terminology alone used in many of the cases obviously portends a special meaning: “salacious,” “lewd,” “libidinous,” tending to “deprave morals,” “incite lascivious thoughts,” “arouse lustful or lecherous desire.” In short, “dirt for dirt’s sake.”
Appellant also discusses a myriad of state and federal cases following Roth v. United States that attempt to apply the obscenity test. We will not attempt to discuss all of the cases or resolve these many applications of what would appear to be contradictory definitions of prurient interest. The definitions range from those apparently concerned with arousal of sexual desires (Excelsior Pictures Corp. v. City of Chicago, Illinois, 182 F. Supp. 400, 403 [N.D. Ill. 1960]) to:
“[M]aterial which excites an unwholesome or unhealthy interest in sex; . . . material which portrays sex with a looselipped, sensuous leer.
“. . . It is apparent that the magazine is published only for the cheapest of sensationalism and for the ‘commercial exploitations of the morbid and shameful craving for materials with prurient effect.’ ” Flying Eagle Publications, Inc. v. United States, 273 F.2d 799, 803, 804 (1st Cir. 1960).
“[And material that is] disgusting, really lewd, shameful, or excites morbid interest in sex.” Eastman Kodak Company v. Hendricks, 262 F.2d 392, 397 (9th Cir. 1958).
In United States v. 35 MM. Motion Picture Film, Etc., 432 F.2d 705, 711, 712 (2d Cir. 1970), the court analyzed the term “prurient interest” as defined by Roth v. United States. The court concluded
“that the Supreme Court has never intended to brand as ‘obscene’ representations of sexual matters which do not import a debasing, ‘shameful or morbid’ quality into the expression or depiction of human sexuality. To conclude otherwise would be to suggest that the human body and its functions are in themselves somehow ‘dirty’ or unspeakably offensive. There is no logic in such a position, and we reject it.”
The court also noted:
“If the arousal of sexual appetite is equated with an appeal to ‘prurient interest,’ it might be necessary to hale into court our leading couturiers, perfumers, and manufacturers of soft drinks, soap suds and automobiles.”
The court concluded:
“Since presentation of the sexual matter in this film is not characterized by the forbidden ‘leer of the sensualist,’ (Ginzburg v. United States, 383 U.S. 463, 468, 86 S.Ct. 942, 16 L.Ed.2d 31 [1966]), we do not believe the film as a whole can be considered an appeal to prurient interest.”
Appellant contends later U.S. Supreme Court cases indicate the Court has retreated from its definition of prurient interest first expressed in Roth v. United States. The State contends when the court added the element of patent offensiveness to the test for obscenity (Manual Enterprises v. Day, 370 U.S. 478, 8 L.Ed.2d 639, 82 S.Ct. 1432 [1962]), it changed the test to mean that the manner of appealing to prurient interest must be a patently offensive manner. Although the two tests operate closely with one another, we do not find the court has clearly altered the definition of prurient interest in this manner. Appellant contends later cases, particularly Ginzburg v. United States, 383 U.S. 463, 16 L.Ed.2d 31, 86 S.Ct. 942 (1966), and Mishkin v. New York, 383 U.S. 502, 16 L.Ed.2d 56, 86 S.Ct. 958 (1966), clearly indicate the definition of prurient interest was evolving to merely an arousal of sexual desire. We have examined those cases and find no conclusive evidence the court intended the element of prurient interest to be solely an appeal to sexual desire. Admittedly the cases do not provide clear-cut guidelines for future precedent regarding prurient appeal, but neither do they eradicate the former test enunciated by the court.
We also reject appellant’s reliance on Cohen v. California, 403 U.S. 15, 29 L.Ed.2d 284, 91 S.Ct. 1780 (1971), and Erznoznik v. City of Jacksonville, 422 U.S. 205, 45 L.Ed.2d 125, 95 S.Ct. 2268 (1975). Cohen did not deal directly with obscenity and the court’s reference to Cohen in Erznoznik does not involve the element of pruriént interest. See Erznoznik v. City of Jacksonville, 422 U.S. at 213, n. 10.
Appellant further contends later cases attempting to apply the standards enunciated in Miller v. California dwell more on the definition of patent offensiveness than on an appeal to prurient interest. Thus, the State concludes the element of prurient interest has diminished in importance and it may now be defined as an appeal to sexual desire. Appellant argues this definition used in conjunction with state standards of patent offensiveness results in the modern test of obscenity. We agree that since the court’s pronouncement in Roth v. United States, the test for obscenity has evolved away from the sole standard of an appeal to prurient interest. The test has not, however, abandoned the element of prurient interest.
“[The modern test is] (a) whether ‘the average person, applying contemporary community standards’ would find that the work, taken as a whole, appeals to the prurient interest, [citation omitted]; (b) whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law; and (c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value.” Miller v. California, 413 U.S. at 24.
This test still embodies the equally important element of prurient interest. U.S. Supreme Court opinions since Roth v. United States have, at times, been vague in their discussion of prurient interest and have assumed that “the term ‘prurient interest,’ as used as an element of the concept of obscenity, is self-explanatory.” Annot., 41 L.Ed.2d 1257, 1274. Nonetheless, from our examination of the obscenity cases from and including Roth v. United States, we find that the overall definition of prurient interest has not altered from that expressed in Roth. Regardless of contradictory aspects of the definition, it is clear the court meant something more than merely an appeal to sexual desires when it discussed the element of prurient appeal. Modern society tolerates a great deal of eroticism in art, literature, sports and advertising, all of which is capable of promoting sexual desires. The use of appellant’s instruction would subject most merchants, television stations and mail order houses to prosecution for promoting obscenity. Any sexually attractive advertisement could be judged patently offensive with no redeeming social values by local community standards in a conservative community by the use of appellant’s definition. Such a definition would do violence to First Amendment protections and is unacceptable. As a final thought, we note the Kansas Legislature had before it the case law definitions of obscenity presented herein and chose to use the term “prurient interest” rather than simply “sexual desire” in its definition of obscene. We are constrained to abide by that decision. We, therefore, decline to accept appellant’s definition of prurient interest. The instruction given by the trial court was correct. The appeal is denied. | [
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ORDER OF SUSPENSION
ON this 24th day of March, 1980, at 1:30 p.m., this matter comes before the court on an order issued to Leo N. Johnson to appear and show cause why he should not be suspended or disbarred from the further practice of law. Leo N. Johnson fails to appear either in person or by counsel. Thereupon, the court receives a report of the investigation of the Disciplinary Administrator and being fully informed finds:
1. On the 20th day of March, 1980, Leo N. Johnson was personally served by the Sheriff of Morris County, Kansas, with a copy of the order of this court directing the said Leo N. Johnson to appear before this court on the 24th day of March, 1980, at 1:30 p.m. to show cause why he should not be disbarred or indefinitely suspended.
2. On the 24th day of March, 1980, Leo N. Johnson advised the Disciplinary Administrator, by telephone, that he did not intend to comply with the order to appear and show cause and did, in fact, fail to appear at the scheduled time.
3. On March 8,1979, Leo N. Johnson, then a member of the bar of the State of Kansas, was indefinitely suspended from the practice of law by this court in proceedings originally instituted before the State Board of Law Examiners (now the State Board for Discipline of Attorneys) for failing to properly represent clients and for neglecting the legal affairs of clients.
4. That excessive use of alcoholic beverages resulting in the neglect of client’s affairs was one of the major factors contributing to the issuance of the original suspension order.
5. On the 18th day of December, 1979, Leo N. Johnson, after petitioning and appearing before this court, was reinstated to the practice of law subject to the following orders:
“IT IS FURTHER ORDERED that Leo N. Johnson shall totally abstain from the use of intoxicating liquor and beverages, including 3.2 per cent beer.
“IT IS FURTHER ORDERED that in the event it comes to the attention of the Court that respondent has resumed the use of alcoholic beverages, including beer, or has violated any of the Canons of Professional Ethics, or disciplinary rules, a show cause order may issue to the respondent and the Court may take such disciplinary action, including disbarment, as it deems just and proper without further formal proceedings of any kind.”
DATED this 24th day of March, 1980.
6. Leo N. Johnson has violated the order of reinstatement issued by this court December 18, 1979, in that he has continued in the excessive use of alcoholic beverages and has neglected the legal business of his clients and has neglected his official duties as the appointed County Attorney of Morris County, Kansas.
7. It is the unanimous opinion of the court that Leo N. Johnson should be indefinitely suspended from the-further practice of law.
IT IS THEREFORE BY THE COURT ORDERED that Leo N. Johnson be and he is hereby indefinitely suspended from the practice of law in the State of Kansas until the further order of this court.
IT IS FURTHER ORDERED that the Clerk of the Appellate Courts shall remove the name of Leo N. Johnson from the active list of attorneys in the State of Kansas and notify all interested parties of this action. | [
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The opinion of the court was delivered by
Fromme, J.:
On rehearing our prior opinion in City of Junction City v. Griffin, 226 Kan. 516, 601 P.2d 684 (1979), is withdrawn and the following opinion is substituted therefor.
Janice Marie Griffin was found guilty by a jury of solicitation for prostitution in violation of a city ordinance of Junction City, 12-509(a). It was apparently her misfortune to have solicited an off-duty policeman. She was sentenced under City Ordinance 12-509(b) to a mandatory 30 days in jail with no probation. She appealed, claiming the ordinance under which she was sentenced was constitutionally impermissible on three grounds: First, the ordinance violated the United States Constitution; second, the ordinance infringed the separation of powers doctrine, in that the ordinance passed by the city attempts to take over the judicial power of determining the extent of punishment; and third, the penalty consisting of a 30-day mandatory jail sentence is so disproportionate to the crime that it shocks the conscience and offends fundamental notions of human dignity.
In the first opinion of this court the above questions were not reached. The court reversed the conviction and set aside the sentence on the ground the Junction City ordinance relating to procedure and to sentencing in the municipal court was constitutionally impermissible and beyond the authority granted to cities in the Home Rule Amendment to the Kansas Constitution (Kan. Const, art. 12, § 5). This holding was based on the belief that the Code of Procedure for Municipal Courts, K.S.A. 12-4101 through 12-4701, was an enactment of statewide concern which was uniformly applicable to all cities.
On Motion for Rehearing it was brought to this court’s attention that Junction City was one of 43 cities which had opted out from under the Code of Procedure. All 43 cities had been advised that the Kansas Code of Procedure for Municipal Courts was not uniformly applicable to all cities. In order that we might reexamine this question a rehearing was granted and additional briefs were filed.
The Home Rule Amendment, Kan. Const. art. 12, § 5, became effective on July 1, 1961. In pertinent part it reads as follows:
“§ 5 Cities’ powers of home rule, (a) The legislature shall provide by general law, applicable to all cities, for the incorporation of cities and the methods by which city boundaries may be altered ....
“(b) Cities are hereby empowered to determine their local affairs and government including the levying of taxes, excises, fees, charges and other exactions except when and as the levying of any tax, excise, fee, charge or other exaction is limited or prohibited by enactment of the legislature applicable uniformly to all cities of the same class: Provided, That the legislature may establish not to exceed four classes of cities for the purpose of imposing all such limitations or prohibitions. Cities shall exercise such determination by ordinance passed by the governing body with referendums only in such cases as prescribed by the legislature, subject only to enactments of the legislature of statewide concern applicable uniformly to all cities, to other enactments of the legislature applicable uniformly to all cities, to enactments of the legislature applicable uniformly to all cities of the same class limiting or prohibiting the levying of any tax, excise, fee, charge or other exaction and to enactments of the legislature prescribing limits of indebtedness. All enactments relating to cities now in effect or hereafter enacted and as later amended and until repealed shall govern cities except as cities shall exempt themselves by charter ordinances as herein provided for in subsection (c).
“(c) (1) Any city may by charter ordinance elect in the manner prescribed in this section that the whole or any part of any enactment of the legislature applying to such city, other than enactments of statewide concern applicable uniformly to all cities, other enactments applicable uniformly to all cities, and enactments prescribing limits of indebtedness, shall not apply to such city.
“(2) A charter ordinance is an ordinance which exempts a city from the whole or any part of any enactment of the legislature as referred to in this section and which may provide substitute and additional provisions on the same subject. Such charter ordinance shall be so titled, shall designate specifically the enactment of the legislature or part thereof made inapplicable to such city by the adoption of such ordinance and contain the substitute and additional provisions, if any, and shall require a two-thirds vote of the members-elect of the governing body of such city. . . . ■
“(d) Powers and authority granted cities pursuant to this section shall be liberally construed for the purpose of giving to cities the largest measure of self-government. ” Emphasis supplied.
By virtue of this constitutional amendment cities are no longer dependent upon the State legislature for authority to determine their local affairs and government. Cities have power granted directly from the people through the constitution. They no longer need specific legislative authorization to pass a particular ordinance. Claflin v. Walsh, 212 Kan. 1, Syl. ¶ 1, 509 P.2d 1130 (1973). This home rule power of a city is subject, however, to optional control by legislative action in four specific areas mentioned in the Claflin case. The area here considered concerns an enactment of statewide concern which is applicable to all cities. In Claflin, 212 Kan. 1, Syl. ¶ 3, it is held that Article 12, Section 5(d) of the Constitution of Kansas requires a liberal construction of the powers and authority granted for the purpose of giving cities the largest measure of self-government. See also Capitol Cable, Inc. v. City of Topeka, 209 Kan. 152, Syl. ¶ 3, 495 P.2d 885 (1972). The Claflin case involved a charter ordinance at variance with a statutory provision for erection of memorials. K.S.A. 73-401 et seq. It was held that a section of the act, K.S.A. 73-407, was not uniformly applicable to all cities and that the city had the right to make changes by charter ordinance so as to place control with the Board of City Commissioners instead of a Board of Trustees. In the opinion it was pointed out that 73-407 was not uniformly applicable to all cities because it permitted three variations in methods of raising funds which were dependent on the size of the cities involved.
One section of the Kansas Code of Procedure for Municipal Courts, K.S.A. 12-4105, has been called to our attention as not being uniformly applicable to all cities and therefore permitting cities to opt out from under the code. It reads:
“The municipal court shall be presided over by a municipal judge. The judge shall be selected in the manner provided by statute. The person so selected shall be a citizen of the United States and at least eighteen (18) years of age. In cities of the first class, the person selected shall be an attorney admitted to the practice of law in the state of Kansas.”
K.S.A. 12-4105 of the Code of Procedure for Municipal Courts does not apply uniformly to all cities. The last quoted sentence applies only to cities of the first class and requires the municipal judge of a first class city to be an attorney. Under the third sentence of this section, applying to second and third class cities, persons who are not attorneys are qualified to hold office as a municipal judge if they are citizens of the United States and are at least eighteen (18) years of age.
In order to preserve the uniformity of the code it has been urged that this section be declared no part of the enactment of the procedural code. However, this section is one of the sections included in L. 1973, ch. 61. It is clearly one of the sections comprising the enactment. The division into chapter, article and sections in the Kansas Statutes Annotated does not have the effect of making separate enactments of a single bill passed by the legislature of the State of Kansas. Marks v. Frantz, 179 Kan. 638, 298 P.2d 316 (1956).
Another argument is made that the legislature by passing the Code of Procedure for Municipal Courts, K.S.A. 12-4101 through 12-4701, has intended to preempt the field.
The court has consistently rejected the doctrine of implied preemption of a particular field. Legislative intent to reserve exclusive jurisdiction to regulate in an area must be clearly manifested by State law. City of Lyons v. Suttle, 209 Kan. 735, 738, 498 P.2d 9 (1972); City of Junction City v. Lee, 216 Kan. 495, 503, 532 P.2d 1292 (1975); Garten Enterprises, Inc. v. City of Kansas City, 219 Kan. 620, Syl. ¶ 3, 549 P.2d 864 (1976). Legislative intent to preempt a field is only the first of two requirements for preemption when it concerns the rights of cities.
It is apparent in this case, under K.S.A. 12-4103, that the legislative intent was to provide a uniform procedure for all municipal courts. Uniform procedure is desirable. However, statutory expression of intent to make a law uniform cannot supplant the constitutional requirement of uniformity. The constitution empowers a city by charter ordinance to opt out from any State enactment which is not uniformly applicable to all cities. The second requirement is uniform application of the State law to all cities.
The grant of home rule power to cities under Article 12, § 5 of the Kansas Constitution has therefore added a new dimension to be considered in determining whether the legislature has occupied a field. Legislative intent to preempt a field is alone insufficient. It is now necessary to examine the provisions of the State enactment to determine whether the constitutional standard of uniform application to cities has been met. If not uniform, legislative intent as expressed within the enactment will not overcome the constitutional requirement for uniform application. Clark v. City of Overland Park, 226 Kan. 609, 602 P.2d 1292 (1979). The legislature may preempt the constitutional powers of cities only in the manner prescribed in the constitution. “As between the will of the people expressed in the constitution, and that expressed in the statute, the former always prevails.” State, ex rel. Goodin v. Thoman, 10 Kan. 191, 197 (1872).
A strong argument is made that a code of procedure in munici pal courts is a matter of statewide concern and should not be left to determination by local government. We are inclined to agree, but the language of the constitutional amendment, which empowers cities to determine their “local affairs and government,” was never intended as a limitation on the power, so as to restrict it to matters of strictly local concern. Barkley Clark, Associate Dean and Professor of Law at the University of Kansas published a comprehensive article State Control of Local Government in Kansas: Special Legislation and Home Rule, 20 Kan. L. Rev. 631, 669 (1972). He points out:
“Nearly all matters dealt with by ordinance are of concurrent interest to both city and state; limiting home rule power to ‘purely’ local matters as the courts in autonomy-type states have sometimes been compelled to do would totally emasculate article 12, section 5. . .
So, even if a legislative enactment by the State addresses a matter which may be considered of statewide concern, a city remains free to take legislative action by charter ordinance concerning that same matter unless the legislative enactment by the State applies uniformly to all cities. Regardless of whether an enactment of the State legislature addresses a matter of statewide or a matter of local concern, a city may in either case act by charter ordinance to exempt itself from all or part of the enactment unless the State enactment applies uniformly to all cities. Kan. Const, art. 12, § 5(c)(1). The legislature may foreclose municipal legislative action only by an enactment of uniform application to all cities.
The Kansas Code of Procedure for Municipal Courts, K.S.A. 12-4101 through 12-4701, although an enactment of statewide concern, is not applicable uniformly to all cities by reason of K.S.A. 12-4105 requiring municipal judges in first class cities to be attorneys while permitting second and third class cities to have lay judges. Therefore, Charter Ordinance No. 8 of Junction City validly exempted the city from the provisions of K.S.A. 12-4101 through 12-4701, and Junction City Ordinances 12-509(a) and 12-509(b) are valid substitute and additional provisions passed by the city under its home rule powers.
We turn now to the constitutional questions originally raised on appeal. It is argued the Junction City ordinance prohibiting solicitation for prostitution and providing a mandatory jail sentence on conviction violates the United States Constitution, in fringes the separation of powers doctrine by restricting the judicial power of the court, and provides a sentence so disproportionate to the seriousness of the crime that it shocks the conscience and offends fundamental notions of human dignity. We hold otherwise.
Junction City adjoins a large military reservation, where several thousand U.S. Army troops are stationed. Prostitution is notoriously a problem in towns which adjoin military installations. The city governing body was well aware of its past problems in this area of social concern when it adopted Charter Ordinance No. 8. It is understandable that the governing body was looking for more stringent measures to deal with what had become a local problem. Ordinance No. 12-509(b) prescribing mandatory jail sentences and providing for no probation was adopted in attempting to alleviate prostitution.
Essentially all the questions originally raised in this appeal were addressed and disposed of in State v. Freeman, 223 Kan. 362, 574 P.2d 950 (1978). In Freeman the appellant attacked the constitutionality of K.S.A. 1977 Supp. 21-4618 which requires that probation and parole be denied when the defendant has used a firearm in the commission of an Article 34 crime. In Freeman, the statute providing for a mandatory sentence was attacked as being constitutionally impermissible on three grounds: (1) A mandatory five-year sentence constituted cruel and unusual punishment; (2) it denied equal protection of the laws; and (3) it deprived defendant of liberty without due process of law because it deprived the courts of their judicial prerogatives in determining sentence.
In Freeman, 223 Kan. 362, Syl. ¶ 2, it was held:
“In determining whether the length of a sentence offends the constitutional prohibition against cruel punishment three techniques should be considered:
“(1) The nature of the offense and the character of the offender should be examined with particular regard to the degree of danger present to society; relevant to this inquiry are the facts of the crime, the violent or nonviolent nature of the offense, the extent of culpability for the injury resulting, and the penological purposes of the prescribed punishment;
“(2) A comparison of the punishment with punishment imposed in this jurisdiction for more serious offenses, and if among them are found more serious crimes punished less severely than the offense in question the challenged penalty is to that extent suspect; and
“(3) A comparison of the penalty with punishments in other jurisdictions for the same offense.”
After applying these tests to the facts of the present case, in which a 30-day mandatory jail sentence without probation was imposed for soliciting for prostitution, we hold the sentence does not offend. The punishment, a 30-day mandatory jail sentence without probation, is neither cruel nor unusual in its method, nor so disproportionate to the crime of solicitation for prostitution that it shocks the conscience and offends fundamental notions of human dignity. See Freeman, 223 Kan. 362, Syl. ¶ 1.
The contention that the sentence denied equal protection of the laws is not persuasive. A State statute or a city ordinance may single out a class of persons for distinctive treatment if the classification bears a rational relation to the purpose of the legislation and if persons similarly inclined will receive like treatment. See Freeman, 223 Kan. 362, Syl. ¶ 4.
Finally it is argued the mandatory sentence provision of the ordinance deprives the defendant of liberty without due process of law because the ordinance takes away a prerogative of the judicial branch of government, that of fixing a sentence commensurate with the seriousness of the crime. In Freeman, 223 Kan. 362, Syl. ¶ 6, we held the provisions of K.S.A. 1977 Supp. 21-4618 and 22-3717(8), which deny probation and parole privileges to a defendant convicted of using a firearm in the commission of an Article 34 crime, do not impose such a restriction on the judicial power of the sentencing judge as would constitute an impermissible legislative usurpation of the court’s prerogatives.
Accordingly, we hold the ordinance was valid and within the home rule powers of the city. It was not otherwise constitutionally impermissible.
Judgment is affirmed. | [
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The opinion of the court was delivered by
Holmes, J.:
This is an appeal in a declaratory judgment action by defendant, Kansas Public Employees Retirement System (KPERS), from an order of the district court holding that the 1974 amendment to K.S.A. 74-4965 and the 1975 amendment to K.S.A. 74-4966 were unconstitutional and invalid and enjoining the defendant from enforcing the same.
Plaintiffs, Robert F. Brazelton, Chief of Police of Fairway, Kansas, and Donald J. Harper, a captain on the fire department of Consolidated Fire District # 2, Johnson County, Kansas, filed suit alleging a class action pursuant to K.S.A. 60-223. The district court found the case met the statutory criteria and ordered it maintained as a class action.
The Kansas Police and Firemen’s Retirement System (KP&F) was first created by the legislature in 1965, and was to commence January 1, 1967 (K.S.A. 74-4951 et seq.). K.S.A. 74-4953 made KP&F a division of KPERS subject to the provisions of K.S.A. 74-4901 to 74-4926 and any amendments thereto. The purposes of the two acts as set forth in the statutes, K.S.A. 74-4901 (KPERS) and 74-4951 (KP&F), are almost identical. K.S.A. 74-4951 reads:
“74-4951. Purpose of act. The purpose of this act is to provide an orderly means whereby police and firemen employed by participating employers and who have attained retirement age or who have become disabled as herein set forth may be retired from active service without prejudice and without inflicting a hardship on the employees retired and to enable such employees to accumulate reserves for themselves and their dependents to provide for old age, disability, death and termination of employment, and for the purpose of effecting economy and efficiency in the administration of governmental affairs.”
Prior to January 1, 1976, the effective date of the amendments in question, employees of participating employers had the amount of their contributions to KP&F reduced by the amount of their contributions to social security. K.S.A. 74-4965, before amendment, required each member to pay 7% of his compensation to KP&F but that amount was reduced by the amount the employee paid in social security taxes. During the period from 1967 to 1975 the social security rates ranged from 3.9% to 4.95%. In 1975 an employee’s contribution to social security amounted to 4.95% of the first $14,100.00 of gross wages received each year. Instead of paying 7%, the amount actually contributed to KP&F was 2.05% and 4.95% was paid to social security. Under this system 7% of the employee’s salary went to pay for retirement in one form or another.
K.S.A. 74-4966, before amendment, required that KP&F retirement benefits be reduced by one-half the amount received in social security benefits. Each time an increase occurred in social security benefits, the state retirement benefit would have a corresponding reduction equal to one-half of the social security increase. The relationship between the two systems could theoretically result in a member receiving nothing from KP&F if social security benefits reached the point where they were twice as much as KP&F benefits. The 1974 and 1975 amendments were enacted to eliminate the interlocking of KP&F with social security.
The members of the class certified in this case consist of all police officers and firefighters employed by participating employers in KP&F, who, during the period from January 1, 1967 through 1975, contributed funds to both the United States Social Security System and KP&F at a total combined rate of 7% of gross salary. The number of employees making up the class is approximately 425.
After January 1, 1976, under K.S.A. 74-4965 and 74-4966, as amended, a member’s contribution to KP&F is 7% of his salary. His contribution is no longer reduced by the amount of contributions to social security, resulting in a reduction óf a member’s take-home pay by 4.95%. The benefits that the member received from KP&F are, however, no longer reduced by one-half the amount of social security benefits received; rather, each member receives the full benefit of the KP&F retirement system regardless of benefits received from social security.
K.S.A. 74-4965, as amended in 1974 (K.S.A. 1978 Supp. 74-4965), reads:
“74-4965. Member contributions; deductions; disposition. (1) Each participating employer shall, beginning with the first payroll for services performed after the entry date, deduct from the compensation of each member seven percent (7%) of his compensation as employee contributions: Provided, That in the case of a member whose employment is covered by social security, the deduction from said member’s compensation shall be reduced by the amount of his contributions to social security. On and after January 1, 1976, no employee contributions shall be reduced because of contributions to social security. Such deductions shall be remitted quarterly, or as the board may otherwise provide, to the executive secretary for deposit in the Kansas public employees retirement fund and shall be credited to the member’s individual accounts.” (Emphasis indicates the 1974 amendment.)
This statute was again amended in 1979 but that amendment is not an issue in this action.
K.S.A. 74-4966 was also amended in 1974 but was again amended in 1975 before the 1974 amendment became effective.
K.S.A. 74-4966, as amended in 1975, (now K.S.A. 1979 Supp. 74-4966), reads:
“74-4966. Certain reductions of benefits in relation to social security; no reduction upon repayment of certain contributions. In the case of any member whose employment shall be covered by social security, any benefits payable under the provisions of K.S.A. 74-4958, 74-4959 and 74-4960 shall be reduced by an amount equal to one-half (lh) of the social security benefits accruing from employment with the participating employer. On. and after January 1, 1976, no benefits shall be reduced because of social security benefits. Any benefits which first become payable on or after January 1, 1976, by reason of employment with a participating employer participating in the Kansas police and firemen’s retirement system, which employment was also covered by social security, shall be reduced by an amount equal to the value of the difference between contributions actually made by the member and contributions which would have been made had there been no reduction for contributions to social security. The amount of reduction shall be made by the board upon the advice of the actuary at the time benefits become payable and shall continue until benefits are no longer payable. Should a member, whose employment prior to January 1, 1976, with a participating employer participating in the Kansas police and firemen’s retirement system, such employment also being covered by social security, repay in a lump sum prior to January 1,1977, or on date of retirement, whichever is earlier, an amount equal to the difference between contributions actually made by the member and contributions which would have been made had there been no reduction for contributions to social security, there shall be no reduction as heretofore provided. If the payment is made after January 1, 1977, but prior to retirement, the member will pay the actual amount plus interest which shall accrue from January 1, 1976, at a rate specified by the board of trustees. ” (Emphasis indicates the 1975 amendment.)
Thus, it can readily be seen that the 1974 and 1975 amendments eliminated the dovetailing or interlocking of social security and KP&F contributions and benefits. Each member’s contribution to his retirement was increased by 4.95%. On the other hand, when the employee reached retirement, his Kansas retirement benefits would no longer be reduced by one-half of any social security benefits received. The 1975 amendment to 74-4966 also requires an employee who is a member of plaintiffs’ class to make up what the parties and expert witnesses refer to as a “contribu tion shortfall.” The contribution shortfall for any particular employee is determined by subtracting the actual contributions made to KP&F prior to 1976 from what the contributions for that employee would have been if he had paid a full 7% of his salary for all periods of membership prior to 1976. The statute further obligates the employee to make up or pay this shortfall in one of three ways: (1) by payment of a lump sum without interest prior to January 1, 1977; (2) by payment of a lump sum plus interest at any time between January 1, 1977, and date of retirement, or (3) after retirement by equal monthly deductions from the retirement benefits of the member, such monthly deductions to be calculated on an actuarial basis based upon the employee’s age and life expectancy at retirement. Interest is compounded and the rate thereof is set from time to time by the KPERS board of trustees. In the event the shortfall is paid under either (1) or (2), the employee upon retirement receives the full amount of his monthly KP&F benefits. If the shortfall is not paid in a lump sum prior to retirement then payment is effected by a monthly deduction from benefits received after retirement. The monthly deductions continue throughout the entire lifetime of the retired employee even though he outlives his life expectancy and even though the shortfall and interest are completely paid. There is no provision for a cessation in the reduction of benefits after full payment of the shortfall and interest.
KP&F is subject to K.S.A. 1979 Supp. 74-4923 which provides in pertinent part:
“74-4923. Rights of members and beneficiaries not affected by change or repeal of act, exception; benefits and rights nonassignable and exempt from taxes and legal process; employer recovery of arrearage obligations. (1) No alteration, amendment, or repeal of this act shall affect the then existing rights of members and beneficiaries, but shall be effective only as to rights which would otherwise accrue hereunder as a result of services rendered by an employee after such alteration, amendment, or repeal except that this provision shall not apply to any alteration or amendment of this act which provides greater benefits to members or beneficiaries, but any such increase of benefits shall only be applicable to benefits payable on the first day of the month coinciding with or following the effective date of such alteration or amendment.” (Emphasis added.)
Plaintiffs, in the trial court, sought a declaratory judgment that K.S.A. 74-4965 and 74-4966, as amended in 1974 and 1975, were invalid as a violation of their constitutional rights under the United States Constitution and as being contrary to K.S.A. 1979 Supp. 74-4923. Plaintiffs also sought a permanent injunction enjoining the defendants from enforcing and performing under the two statutes as amended. The trial court found that the amendments violated K.S.A. 1979 Supp. 74-4923, were unlawful, created an unconstitutional impairment of the obligation of contracts and therefore were invalid. A permanent injunction was issued prohibiting the enforcement of both the 1974 amendment to K.S.A. 74-4965 and the 1975 amendment to K.S.A. 74-4966. KPERS has appealed.
As stated by the appellant: “Are the 1974 and 1975 amendments to K.S.A. 74-4965 and K.S.A. 74-4966 constitutionally invalid as an unlawful impairment of the obligation of contract?” We might also add: Are they invalid as being in violation of K.S.A. 1979 Supp. 74-4923? We think both questions must be answered in the affirmative.
Neither party to this appeal seriously contends that the rights to pension benefits under KPERS and KP&F are not contractual in nature. Shapiro v. Kansas Public Employees Retirement System, 216 Kan. 353, 532 P.2d 1081 (1975). The appellant at the trial level attempted to place some reliance upon dicta in State, ex rel., v. Board of Education, 155 Kan. 754, 129 P.2d 265 (1942), wherein the court observed that pension rights granted by public authorities were generally considered gratuities and not contractual obligations. The language in State, ex rel., v. Board of Education has been expressly disapproved by this court in Singer v. City of Topeka, 227 Kan. 356, _ P.2d _ (1980). Over the years a pensioner’s rights have gradually evolved from none at all, based upon the theory of gratuity, to contractual or vested property rights. Some states still follow the gratuity theory while at least one (Arizona) has adopted a hard and fast application of the law of contracts. We see no reason to lengthen this opinion with a dissertation on the historical background of the various theories prevailing today. A participating member of KP&F and KPERS does have certain contractual rights based upon the statutes which create the systems and which are a part of the employment contract. Any attempt to define the parameters of such rights in any situation other than that before the court would not only be presumptious and unwise but probably impossible and must be left to subsequent courts to determine on a case by case basis. Suffice it to say that when a person accepts employment with a governmental entity and becomes a participating member of the retirement system, he or she gains certain rights which may not be eliminated or substantially changed by unilateral action of the governmental employer to the detriment of the member. For example, the right to withdraw contributions under K.S.A. 1979 Supp. 74-4963 and K.S.A. 1979 Supp. 74-4917.
“The concept of pensions has come down through the centuries wearing a cloak of monarchial dispensation. Kings conferred pensions on court favorites, artists and military heroes with a flourish which proclaimed that the royal treasury was as inexhaustible as the crown’s power was unlimited. However, despite ceremony and pronounciamento, the pensioner obtained no vested right to the proclaimed pension. In fact, he could not be any more assured of a continuation of the pension than he could be assured that his head would remain on his shoulders if he should displease his absolutist benefactor. But the pension of today is not a grant of the Republic nor in this case is it a gift of the City Fathers. It is the product of mutual promises between the pensioning authority and the pensioner; it is the result of contributions into a fund which exists for the single purpose of pensions.” Hickey v. Pittsburgh Pension Board, 378 Pa. 300, 304-305, 106 A.2d 233, 52 A.L.R.2d 430 (1954).
Public employment seldom pays as much as a comparable job in the private sector. A pension to be received upon retirement is a prime inducement in securing qualified workers and avoiding the expense of a high turnover rate. Retirement benefits are a valuable part of the consideration for entering into and continuing in public service. A member of a governmental pension system has certain vested rights in the pension plan because it is a vital part of the consideration for entering into and performing under the employment contract. For those interested in pursuing the evolution of the contract and/or vested rights theories of the modern governmental pension plan see Cohn, Public Employee Retirement Plans — The Nature of the Employees’ Rights, Ill. L. F. 32 (1968); Note, Public Employee Pensions in Times of Fiscal Distress, 90 Harv. L. Rev. 992 (1977); Note, Yeazell v. Copins: Public Employee’s Pension Plan Creates a Contractual Right Which May Not Be Impaired During His Employment, 70 Dick. L. Rev. 524 (1966), and Annot., 52 A.L.R.2d 437.
In the case at bar, the plaintiffs and others of their class had been contributing a total of 7% of their gross compensation to KP&F and social security. The 1974 amendment to 74-4965 required each member of the class to contribute a full 7% of compensation to KP&F without reduction for the amount (4.95% at time of trial) paid for social security. The 1975 amendment to 74-4966 required members of plaintiffs’ class to make up the contribution shortfall, in one way or another, as previously set forth in this opinion. In the case of the named plaintiff Brazelton the shortfall was $3,912.15 and for Harper it amounted to $3,784.51. The normal retirement age under KP&F is 55 yeárs of age coupled with at least 20 years of service (K.S.A. 1979 Supp. 74-4957). Thus, under the law prior to the amendments in question a member with 20 years of service could retire at age 55 and receive full KP&F retirement benefits until social security retirement age of 62. After the amendments, the same person would be required to pay his contribution shortfall in a lump sum or have his KP&F retirement benefits beginning at age 55 reduced by the actuarially determined monthly payment necessary to cover the shortfall and compound interest. Assuming retirement in 1976, in the case of Brazelton the shortfall payment is $42.48 per month and for Harper it is $93.43. Thus, for the period from age 55 to age 62, the pensioner would actually receive less each month than he would have received prior to the amendments. Appellants concede in their brief that the amendments to K.S.A. 74-4965 and 74-4966 have the following effects on the members of plaintiffs’ class:
“1. A 4.95 percent reduction in take-home pay as of January 1, 1976.
“2. A reduction in retirement benefits for those who retire between the ages of 55 and 62 as compared to previous law.
“3. Imposition of a ‘contribution shortfall’ payment . . . .”
Appellant also contends that the amendments result in an increase in total benefits to members who had contributed to both KP&F and social security if they live long enough. It appears from the evidence that the class as a whole would in all probability receive greater total benefits under the amended statutes as opposed to the prior law. This argument might prevail if we were faced solely with the future application of the amendments and if they only required increased future contributions combined with increased benefits. That determination is not before the court in this action. Appellee contends, and the trial court so found, that the amendments constitute a retroactive change of the contribution rate for the period from 1967 to January 1, 1976, create a disadvantageous modification of plaintiffs’ rights without a corresponding offsetting advantage, and further constitute an unlawful and unconstitutional impairment of the obligation of contracts under Article I, Section 10 of the United States Constitution and are also contrary to the provisions of K.S.A. 1979 Supp. 74-4923. Appellant argues that the imposition of the “contribution shortfall” is not retroactive as the money is to be collected in the future and therefore is not an impairment of contract. It is difficult to fathom how an increase in contribution rates to be applied for past years of service already rendered could be collected in any other manner than in the future. However, the argument begs the point as obviously the requirement to pay additional KP&F contributions for years of past completed service does operate retroactively and adversely affects the rights the members of the class enjoyed during the period from 1967 to January 1, 1976. As we held in State, ex rel., v. Paulsen, 204 Kan. 857, 465 P.2d 982 (1970), any such impairment is constitutionally prohibited and “the magnitude or degree of the impairment is of no consequence.” p. 861. One of the glaring deficiencies of the statutes as amended is that members of the class were given no option to (1) remain under the old provisions of the system and continue to pay reduced rates and receive benefits on retirement reduced in part by social security benefits, or (2) to elect to participate in the new provisions of the system, pay the contribution shortfall and higher rates, and receive full KP&F benefits. If such an option had been provided each individual would have had the right to make a determination of which system would be most beneficial to his or her needs. To have the retirement benefit provisions of an employment contract retroactively changed in a substantial manner by the unilateral action of the employer to the disadvantage or detriment of the members of the class violates both the constitutional prohibition against impairment of contract and the express terms of K.S.A. 1979 Supp. 74-4923.
The trial court made, among others, the following findings of fact:
“5. In 1974-1975, K.S.A. 74-4965 and 4966, which outlined a method of adjusting deductions and benefits for those employees belonging to both Social Security and KP&F, were amended by the Kansas legislature to eliminate the dual and interlocking system between Social Security and KP&F as it existed by virtue of those statutes.
“6. The 1974-1975 amendments to K.S.A. 74-4965 and 4966 mandate a reduction in benefits to those employees contributing to both Social Security and KP&F. These amendments have retroactive application, causing these plaintiffs to become liable for contribution shortfalls which would not have been required of them under the existing statutes.
“7. The 1974 amendment created a class of employees who, because of their contribution to, both Social Security and KP&F, would be entitled to full KP&F benefits even though they had not contributed a full seven percent (7%) to the KP&F system from 1967 to 1976. This, the Budget .Committee believed, led to the appearance of inequity.
“8. The ‘appearance of inequity’ in the minds of the Committee was created when the 1974 amendment made all contributions and benefits under KP&F equal for all members. The amendment created a class of members who, from 1967 to 1976, had not contributed a full seven percent (7%) of their salary to KP&F. This class, however, was now to receive full KP&F benefits upon retirement.
“9. As a result of the 1974 and 1975 amendments, a contribution shortfall was assessed to those employees covered by both KP&F and Social Security prior to 1976.
“11. Approximately 300 members of the Kansas Police and Firemen’s Retirement system are required to make lump sum contributions to the system.
“12. The total amount of said lump sum contribution shortfall for the 300 members is $487,630.05.
“16. There is no administrative procedure to terminate the reduction of benefit payments even though a retiree has repaid the system his total contribution shortfall payback.
“17. At creation, in 1967, the KP&F System was funded on a sound actuarial basis and would have continued to be funded on a sound actuarial-reserve basis because of other provisions in the Act creating the Kansas Public Employees Retirement System. The 1974 and 1975 shortfall amendments to KP&F were not needed to keep the System on a sound actuarial footing.
“19. If the contribution shortfall was not assessed to the employees, higher employer contributions to KP&F would be required. If no shortfall was assessed to the employees, the uniform cost rate for employers would, at the most, increase by l/10th of a point, which is a negligible impact.
“20. There is only a relative, minor difference in administrative complexity for the KP&F System when KP&F benefits are periodically reduced by Social Security increases, as compared to the situation where there is no relationship between the fund and Social Security. In terms of additional administrative costs between a system affected by Social Security increases and one that is not, the difference in costs is negligible. Thus, the administrative problems involved were not of primary importance in deciding whether changes in KP&F should be made.
“21. A reduction in take-home pay of the members of the class is caused by the additional burden of a deduction for his Social Security contribution on top of his deduction for KP&F contribution.”
All of the findings are supported by substantial competent evidence and many are admitted by appellant.
In Yeazell v. Copins, 98 Ariz. 109, 402 P.2d 541 (1965), it was held that an employee at the date of employment became vested with contractual pension rights in accordance with the statutes as they existed on that date and that no change could be made without the agreement of the employee. We decline to adopt that hard and fast rule. There may be times when changes are necessary to protect the financial integrity of the system or for some other compelling reason which woYild mandate and justify some unilateral changes. As pointed out in Singer v. City of Topeka, the California courts have developed a continuing body of law, on a case by case basis, determining an employee’s rights to pension benefits. The present application of the rules developed by the decisions of the California courts were set forth recently in Betts v. Board of Administration, 21 Cal. 3d 859, 863, 148 Cal. Rptr. 158, 161, 582 P.2d 614 (1978), as follows:
“A long line of California decisions has settled the principles applicable to the problems herein presented. A public employee’s pension constitutes an element of compensation, and a vested contractual right to pension benefits accrues upon acceptance of employment. Such a pension right may not be destroyed, once vested, without impairing a contractual obligation of the employing public entity. (Kern v. City of Long Beach (1947) 29 Cal. 2d 848, 852-853 [179 P.2d 799].) The employee does not obtain, prior to retirement, any absolute right to fixed or specific benefits, but only to a ‘substantial or reasonable pension.’ (Wallace v. City of Fresno (1954) 42 Cal. 2d 180, 183 [265 P.2d 884].) Moreover, the employee’s eligibility for benefits can, of course, be defeated ‘upon the occurrence of a condition subsequent.’ (Kern, supra, at p. 853 [179 P.2d at p. 802].)
“However, there is a strict limitation on the conditions which may modify the pension system in effect during employment. We have described the applicable principles as follows: ‘An employee’s vested contractual pension rights may be modified prior to retirement for the purpose of keeping a pension system flexible to permit adjustments in accord with changing conditions and at the same time maintain the integrity of the system. [Citations.] Such modifications must be reasonable, and it is for the courts to determine upon the facts of each case what constitutes a permissible change. To be sustained as reasonable, alterations of employees’ pension rights must bear some material relation to the theory of a pension system and its successful operation, and changes in a pension plan which result in disadvantage to employees should be accompanied by comparable new advantages. [Citations.] . . .
We think the California rule as it has evolved is as appropriate to safeguard the interests of government and its employees in the State of Kansas as in the State of California.
Evidence in the instant case showed that the imposition of the retroactive increase in rates and the contribution shortfall were not necessary to preserve or protect the pension system; to maintain flexibility; to permit necessary adjustments due to changing conditions; to protect the beneficial purpose of the system; to maintain the system on a sound actuarial basis or by reason of administrative necessity. The sole purpose of the contribution shortfall was to overcome an appearance of inequity which would otherwise result if members of plaintiffs’ class were to receive increased KP&F benefits (no reduction for social security benefits) without having contributed a full 7% to the system during the period in question. While it is true that without the imposition of the contribution shortfall, new employees coming into the system after January 1, 1976, would be required to pay a full 7% of their compensation to receive the same benefits that members of the class would receive who paid a lesser amount during the years prior to January 1, 1976, we are of the opinion that such an inequity is not sufficient justification within the so-called California rule to retroactively impair the contractual rights of the class.
K.S.A. 74-4969 provides:
“If any clause, paragraph, subsection or section of this act shall be held invalid or unconstitutional, it shall be conclusively presumed that the legislature would have enacted the remainder of this act without such invalid or unconstitutional clause, paragraph, subsection or section.”
In Flax v. Kansas Turnpike Authority, 226 Kan. 1, Syl. ¶ 6, 596 P.2d 446 (1979), we held:
“A statute, apparently valid upon its face, may be unconstitutional in its application to a particular set of facts, circumstances or classifications.”
The record is silent as to what has transpired with respect to members of the class since January 1,1976, or to employees hired by participating employers since that date. In the original petition filed by plaintiffs a temporary restraining order and injunction were requested. However, the record does not reflect that either was ever granted. The record is silent whether the members of the class who have retired since January 1, 1976, are having their KP&F benefits reduced by the contribution shortfall. It does not indicate whether members of the class who are still employed have been assessed a full 7% of compensation for KP&F or only the difference between their social security payments and 7%. It does not indicate whether new employees hired between January 1, 1976, and June 25, 1979, (the date of the trial court decision enjoining the defendant from enforcing K.S.A. 74-4965 and 74-4966, as amended) paid a full 7% of compensation to KP&F during that period. Such new employees, as a part of their contract of employment, would expect to pay 7% to KP&F and could expect to receive on retirement full KP&F benefits unreduced by any social security benefits.
The 1975 amendment to K.S.A. 74-4966 clearly requires the members of the class to pay additional contributions to KP&F for a period of employment already completed and performed and results in a retroactive impairment of the employee’s contractual rights which is prohibited by the Constitution and invalid. As a result the 1974 amendment to K.S.A. 74-4965 is also fatally defective in that it mandates increased contributions to KP&F (from 2.05% to 7%), a distinct disadvantage to the employee, with no offsetting or compensating advantage.
Therefore, we hold that the 1974 amendment to K.S.A. 74-4965 and the 1975 amendment to 74-4966 are invalid as to the plaintiffs and the members of plaintiffs’ class as an unconstitutional violation of the contract clause of the United States Constitution and as being contrary to the express provisions of K.S.A. 1979 Supp. 74-4923. Absent any option for members of plaintiffs’ class to retain their old position in the system or accept the new provisions, the rights of the members of the class have been substantially impaired unilaterally and retroactively without offsetting advantages. The statutes as amended are valid as to those employees who have commenced employment with a participating employer subsequent to January 1, 1976. Defendant is directed to restore plaintiffs and the other members of the class to their rights as they existed prior to January 1, 1976, including such monetary adjustments and payments as may be required.
The trial court decision is affirmed as to plaintiffs and members of the plaintiffs’ class and under the provisions of K.S.A. 60-1703, the case is remanded to the district court for such further proceedings and orders as may be necessary. | [
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The opinion of the court was delivered by
Holmes, J.:
This is an appeal by Charlotte Ann White from an order of the juvenile department of the Sedgwick County District Court (juvenile court or trial court) waiving its jurisdiction and referring her to stand trial as an adult pursuant to K.S.A. 1979 Supp. 38-808. This is the second appearance of this case before this court. See In re White, 224 Kan. 717, 585 P.2d 1046 (1978), (White I).
The State in a petition filed with the juvenile court alleged that on August 27, 1977, Charlotte Ann White shot and killed one James Wofford. Appellant was seventeen years old at the time and was charged with an act of delinquency which, if committed by an adult, would have been a felony (first-degree murder). On September 8, 1977, a referral hearing was held to determine whether "Charlotte was a fit and proper person to be dealt with under the Kansas juvenile code. The juvenile court determined she was not and directed she be prosecuted as an adult. That decision was reversed in White I due to a failure of the State to produce any evidence in support of its position that she was not a fit and proper person for juvenile proceedings. Following our decision in White I, a second hearing was held by the juvenile court wherein the State did produce evidence in support of its position. On March 20, 1979, the court once again found that Charlotte was not a fit and proper person to be dealt with under the juvenile code and directed that she be prosecuted as an adult. It is this second referral determination which is now before this court.
Charlotte was born June 30,1960, and at the time of the alleged crime and the first hearing to determine fitness to be dealt with under the juvenile code was seventeen years of age. She was eighteen when White I was decided and is now nearly twenty years old. To further complicate matters, following the first certification to try Charlotte as an adult the criminal department of the district court proceeded with criminal charges while the appeal on the initial referral determination was pending in this court. Charlotte was tried before a jury for first-degree murder. During the trial she entered into plea negotiations with the district attorney and on June 2, 1978, entered a plea of guilty to second-degree murder. At that time she lacked 28 days of being eighteen years of age. Sentencing on the plea was apparently deferred pending the decision in White I and thereafter the outcome of the second hearing before the juvenile court. Following the March 20, 1979, juvenile court decision, Charlotte was sentenced on April 27, 1979, to the custody of the Secretary of Corrections for a period of not less than five years nor more than life pursuant to K.S.A. 21-4501(h) and 75-5229. As a firearm had been used in the homicide the provisions of K.S.A. 1978 Supp. 21-4618 were invoked. We note at the outset that neither party has raised any question on this appeal as to the propriety or validity of the criminal proceedings in district court and such issues are not now before this court. In addition, no question has been raised whether Charlotte’s plea of guilty and failure to seek a stay of the criminal proceedings constitute a waiver of her objection to the juvenile court proceedings. For an excellent discussion of the problems raised by subsequent criminal proceedings following an erroneous referral by the juvenile court see Six and Reeves, Waiver of Juvenile Court Jurisdiction in Kansas, 22 Kan. L. Rev. 193 (1974).
Two points are raised by Charlotte in this appeal. She contends (1) the trial court erred by applying the wrong test or standard thus denying her due process of law, and (2) the determination to waive juvenile jurisdiction and refer Charlotte for trial as an adult was not supported by substantial evidence.
K.S.A. 1979 Supp. 38-808(b) provides:
“(b) Notwithstanding any provisions of the Kansas juvenile code or any other law of this state to the contrary, whenever a petition has been filed pursuant to the Kansas juvenile code alleging that a child is, by reason of violation of any criminal statute, a delinquent or miscreant child described in K.S.A. 1976 Supp. 38-802, and that the child was sixteen (16) years of age or older at the time of the alleged commission of such offense and the petitioner, or the county or district attorney upon motion made prior to the hearing on the petition, alleges that such child is not a fit and proper subject to be dealt with under the Kansas juvenile code, the court shall immediately set a time and place for a hearing to determine if such child is a fit and proper person to be dealt with under the Kansas juvenile code. Such hearing shall be held prior to the hearing on the petition and shall conform to the requirements for notice and appointment of a guardian ad litem as provided by K.S.A. 1976 Supp. 38-815b, for detention hearings. Upon the completion of the hearing and a finding that the child was sixteen (16) years of age or older at the time of the alleged commission of the offense, the court may make a finding, noted in the minutes of the court, that the child is not a fit and proper subject to be dealt with under the Kansas juvenile code. In determining whether or not such finding should be made, the court shall consider each of the following factors: (1) Whether the seriousness of the alleged offense is so great that the protection of the community requires criminal prosecution of the child; (2) whether the alleged offense was committed in an aggressive, violent, premeditated or willful manner; (3) the maturity of the child as determined by consideration of the child’s home, environment, emotional attitude and pattern of living; (4) whether the alleged offense was against persons or against property, greater weight being given to offenses against persons, especially if personal injury resulted; (5) the record and previous history of the child; (6) whether the child would be amenable to the care, treatment and training program for juveniles available through the facilities of the court; and (7) whether the interests of the child or of the community would be better served by criminal prosecution of the child. The insufficiency of evidence pertaining to any one or more of the factors listed in this subsection shall not in and of itself be determinative of the issue. Written reports and other materials relating to the child’s mental, physical, educational and social history may be considered by the court, but the court, if so requested by the child, the child’s parent or guardian or other interested party, shall require the person, persons or agency preparing the report and other material to appear and be subject to both direct and cross-examinations.”
The seven factors to be considered by the court were included in an amendment of the statute as a result of the decision in Kent v. United States, 383 U.S. 541, 16 L.Ed.2d 84, 86 S.Ct. 1045 (1966).
In support of her first point, appellant contends that the juvenile court at the second referral hearing applied the wrong time standard in determining her fitness to be dealt with under the juvenile code. Appellant argues that when this court in White I reversed the original decision of the juvenile court to waive jurisdiction the court at the second hearing was obligated to consider de novo her fitness as of the time of the original hearing. Appellant bases her argument largely upon the holding in White I that “the order of the district court must be reversed and the case remanded for a new hearing on the issue of whether she was a fit and proper person to be dealt with under the Kansas Juvenile Code.” 224 Kan. at 719. (Emphasis added.) We do not interpret this statement from White I as a determination that the date of the initial hearing is controlling. The statute is not entirely clear and the question is one of first impression for this court. Appellant contends that at the hearing in March of 1979, when Charlotte was nearly 19 years old, the court should have considered the evidence of her fitness to be dealt with under the juvenile code only as it would apply to the conditions which existed at the time of the original hearing in September, 1977, when she was only 17 years old. Appellant argues that to apply the evidence to conditions as they exist at the time of the second hearing is fundamentally unfair and violates due process of law.
Judge Morrison, an experienced juvenile judge, in commenting on the question stated:
“I think the test is whether the Court at this point finds that she is either now or was at that time a fit and proper subject to be dealt with under the Kansas Juvenile Code.”
The learned trial judge obviously recognized that both hearing times are important and must be considered. We concur. While appellant’s argument appears logical at first blush, the problem is that the fitness of the person to be dealt with under the juvenile code is not a static condition but a constantly changing one that cannot be rolled back. Assuming, for the sake of argument, that the evidence reveals that Charlotte was a fit and proper person for juvenile proceedings at the time of the first hearing, we cannot arbitrarily say that she would continue to be so two years later. If the court determines in the later hearing that the evidence, when applied as of the time of the original hearing, justifies the original referral for trial as an adult no problem arises and such a determination controls. Kent v. United States, 383 U.S. at 564-565. On the other hand, if the court determines that the juvenile was originally a fit and proper subject to be dealt with under the juvenile code, then the trial court must go one step further and determine whether such fitness still exists as of the date of the later hearing. If, due to the lapse of time and the changes brought about as a result thereof, the person is no longer a fit and proper person to be dealt with in juvenile proceedings, the existing circumstances at the time of the later hearing must control. There would be nothing to be gained for either the State or the individual to attempt to deal with the person under the juvenile code if such proceedings would no longer be helpful to or in the best interests of the individual. The statute requires a hearing and, after a consideration of the factors enumerated in the statute, the court “may make a finding, noted in the minutes of the court, that the child is not a fit and proper subject to be dealt with under the Kansas juvenile code.” (Emphasis added.) K.S.A. 1979 Supp. 38-808(b). The statute contemplates that if there has been a change in the person’s fitness to be dealt with under the juvenile code, the fitness of the individual at the time of the hearing must ultimately be the controlling time factor. We are not called upon and do not here decide the proper disposition of the criminal proceedings if Charlotte had been found fit to be dealt with under the juvenile code as of the time of both hearings.
The trial court, in setting a standard in which it considered the conditions as they existed at the time of the original hearing and at the time of the current hearing, properly applied the requirements of the statute. Other courts have considered similar situations and have had considerable difficulty in adopting an appropriate time standard to be applied when the results of a referral hearing are set aside on appeal several years later. See Kemplen v. Maryland, 428 F.2d 169 (4th Cir. 1970); Haziel v. United States, 404 F.2d 1275 (D.C. Cir. 1968); Kent v. United States, 401 F.2d 408 (D.C. Cir. 1968); Kent v. United States, 383 U.S. 541, 16 L.Ed.2d 84, 86 S.Ct. 1045 (1966); and Black v. United States, 355 F.2d 104 (D.C. Cir. 1965). In the instant case a review of the evidence, as hereinafter set forth, indicates that if the evidence had been submitted at the September, 1977, hearing the court’s determination that Charlotte was not a fit and proper person to be dealt with under the juvenile code would have been upheld. The evidence would support such a determination as of the time of either hearing. We find no failure of due process in the later proceedings and appellant’s first point is without merit.
The second point on appeal is that the decision to waive juvenile jurisdiction and refer Charlotte for prosecution as an adult was not supported by substantial evidence. We have held that the trial court’s decision to waive juvenile jurisdiction must be supported by substantial evidence which is defined in In re Ferris, 222 Kan. 104, 563 P.2d 1046 (1977), as:
“The term ‘substantial evidence’ has come to have a well-defined meaning in our law. It is said to be evidence possessing something of substance and relevant consequence, and which furnishes a substantial basis of fact from which the issues tendered can be reasonably resolved. (State v. Green, supra at 443 [218 Kan. 443]; and In re Templeton, supra at 94 [202 Kan. 94].)” p. 111.
At the March, 1979, hearing the State presented the testimony of three witnesses. A transcript of testimony given by one Win-ford Burkhalter during appellant’s criminal trial was accepted in evidence without material objection from appellant. Burkhalter testified in the jury trial that he was the owner of the C & W Cafe in Wichita; during the early morning hours of August 27, 1977, while sitting in front of his business establishment, Charlotte and James Wofford came out of the cafe arguing; Charlotte was telling Wofford to keep out of her business; Wofford replied he didn’t know what she was talking about; Charlotte grabbed Wofford by the shirt, pushed him and again stated she didn’t want him messing in her affairs; Charlotte returned to the cafe, obtained her purse, and again emerged from the building and engaged Wofford in further argument; after further conversation, she drew a pistol from her purse, told Wofford she was not scared of him, waved the pistol back and forth, and then shot Wofford; Charlotte again returned to the cafe and upon emerging once again told Wofford that if he didn’t mind his own business she would kill him next time; and then Charlotte departed from the premises.
Dennis Shumate, Superintendent of the Youth Center at Beloit, testified the center was the only state supported and operated facility serving adolescent females in the state; described the treatment and programs available; stated the normal length of stay for girls at Beloit was 10 to 12 months; the center could give treatment to girls until they were 21 years old; the target age for inmates was 15 - 16 years of age but older girls could be accommodated; the center had room available at the time; and he was not acquainted with Charlotte White.
Detective Louis Brown of the Wichita Police Department testified he spoke with Charlotte twice on the morning of August 27, 1977, after she was taken into custody and that Charlotte was advised of her Miranda rights and consented to make a statement. He then testified as to what Charlotte told him on the morning of August 27, 1977. According to Brown, she stated she had some minor problems in Oklahoma such as misdemeanor stuff and runaway; she had been placed in a girl’s school for running away; she lived with her mother in Oklahoma City, but had left home at age 15 and moved to Tulsa where she worked in a chicken place for awhile; she then moved to Wichita where she had been living for about a year; she lived in Wichita with a 37-year-old man named Glendon Tunnels; Tunnels was supporting her and she was not working or attending school. Lt. Brown then testified as to her version of the shooting of Wofford, including her statement to Wofford after the shooting, “I hope you die,” or words to that effect. Charlotte’s version of the shooting, as told by Lt. Brown, varied considerably from that of the only eyewitness, Burkhalter.
Appellant then proceeded to present her evidence, including testimony by one Darlene M. Coffelt, of the Sedgwick County jail ministry, who described the Teen Challenge Program in Denver, Colorado, which had been attended by Charlotte for about a month prior to the hearing. The Program considered Charlotte a satisfactory prospect and was willing to take her for a year if the court so ordered.
Dr. Jack Knopps, a psychologist with Topeka State Hospital, testified as to tests administered to Charlotte. He was of the opinion she had an infantile personality; would need several years of treatment in an institutional setting and did not think she would be benefitted by being subjected to the adult prison system.
James Morse, a psychiatric social worker, testified he first met Charlotte in December, 1976, when he counseled her after an overdose of drugs rendered her unconscious. He continued to see her on an out-patient basis until August, 1977; considered her immature; felt she needed a structured environment; and was of the opinion the adult prison system would be detrimental.
Willie Howard, a physician’s assistant with the Sedgwick County jail, described at least three suicide attempts by Charlotte during her confinement and he considered her mental development to be like that of a twelve or thirteen-year-old.
Delores Jones testified she had known Charlotte White since she first came to Wichita and she considered her to be immature and very childish.
Edith A. Bangle, a matron at the Sedgwick County jail, testified she had contact with Charlotte over a nineteen-month period during which Charlotte was incarcerated. She considered Charlotte to have been very immature, very hostile and very upset when she first met her but felt she had made a gradual change for the better. She also testified she had some discipline problems with Charlotte during the period.
Appellant took the stand and testified about the incidents surrounding the shooting of James Wofford. She testified she knew Wofford had a gun in his car; that he was going to get the gun; she carried a gun in her purse; she had been in an argument with Wofford; that she was not going to go to bed with Wofford; Wofford was cussing and hitting her and when he started for his car she shot him. The gist of her testimony was that she shot Wofford in self-defense.
Following final arguments the court made a lengthy statement explaining its decision that Charlotte was not a fit and proper person to be dealt with under the juvenile code. The trial judge went through all of the seven factors set forth in K.S.A. 1979 Supp. 38-808(b) and the evidence relating to each. The written journal entry filed by the court reads:
“JOURNAL ENTRY OF REFERRAL
“On this 20th day of March, 1979, the above captioned matter comes on for hearing upon the Motion of the State of Kansas for Waiver of Jurisdiction pursuant to K.S.A. (1978 Supp.) 38-808(b).
“The State appears by Charles E. Millsap, Assistant District Attorney for Sedgwick County, Kansas, and the juvenile, Charlotte Ann White, appears in person and by her Court appointed counsel, Michael H. Morgan, a regularly practicing attorney in Wichita, Sedgwick County, Kansas. The Court finds that the matter is properly before it for hearing, that all interested parties have been properly notified pursuant to K.S.A. (1978 Supp.) 38-808(b), and that the Court has jurisdiction to hear the Motion before it.
“Thereupon, the State presents its evidence and argument on the Motion. Counsel for the juvenile then presents evidence and argument in opposition to the State’s Motion.
“Thereafter, the Court, after examining the Court’s files and hearing the evidence and arguments of counsel concludes that the juvenile, Charlotte Ann White, is not a fit and proper subject to be dealt with under the Juvenile Code of the State of Kansas. In support thereof the Court finds that the juvenile was 17 years of age at the time of the alleged offense and furthermore makes the following findings:
1) That the act alleged in the petition and as explained by the evidence is one of the most serious violations defined in the Kansas Criminal Code;
2) That the act alleged in the petition was committed in a violent, willful, and aggressive manner;
3) That the juvenile, judged by an emotional standard appears immature, but by examining her pattern of living, home, and environment indicates that she had for some time adopted the lifestyle of an adult;
4) That the offense was committed against a person and that death to the victim resulted therefrom;
5) That there is no great amount of evidence concerning a court record of the juvenile other than reference to some minor offenses in Oklahoma along with evidence of a previous probation during the time prior to the juvenile leaving Oklahoma;
6) That while the psychological evidence tends to disagree, considering the juvenile’s mobility and self-sufficient life-style, along with her age, Charlotte Ann White is not amenable to the care, treatment and training programs for juveniles available through the facilities of the Court;
7) That the best interests of the juvenile and of the community are best served by a viable rehabilitation program and the Court finds this is much more likely to occur through criminal prosecution.
“IT IS THEREFORE BY THE COURT ORDERED that the State’s attorney prosecute the said Charlotte Ann White under the applicable criminal statutes of the State of Kansas and thereafter dismiss the petition filed pursuant to the Kansas Juvenile Code.
“IT IS FURTHER ORDERED BY THE COURT that the appearance bond given by the juvenile and her surety on February 16, 1979, be continued in effect and that as an added condition to said bond, Charlotte Ann White, is ordered to appear at the criminal docket call in the Criminal Department of this Court at 3:00 p.m. on March 28, 1979. The Clerk of the Juvenile Department is ordered to deliver the original copy of the bond to the Clerk of the Criminal Division of the Court.”
It should be noted that the statute specifically provides “[t]he insufficiency of evidence pertaining to any one or more of the factors listed in this subsection shall not in and of itself be determinative of the issue.” K.S.A. 1979 Supp. 38-808(b). The evidence reveals that Charlotte left home at the age of fifteen and had been self-sufficient since that time. As stated by the trial judge her ability to cope with the adult world over a long period of time tends to dispute the expert testimony as to her immaturity. By her own testimony Charlotte admitted that she regularly carried a firearm in her purse and she was voluntarily living with and being supported by a man twenty years her senior. The opinion of the experts that the adult prison system would not be beneficial to Charlotte and in some opinions would be detrimental is a factor to be considered but would not be controlling of the trial court’s decision. It is doubtful that the adult prison system, as it exists today, is beneficial to very many of the inmates who are unfortunate enough to be exposed to it. The decision of the juvenile division of the district court is supported by substantial evidence and must be affirmed. See In re Ferris, 222 Kan. 104, 563 P.2d 1046 (1977); In re Harris, 218 Kan. 625, 544 P.2d 1403 (1976); In re Patterson, Payne and Dyer, 210 Kan. 245, 499 P.2d 1131 (1972); and In re Templeton, 202 Kan. 89, 447 P.2d 158 (1968).
We have carefully considered all authorities and arguments propounded by the appellant.
One final matter remains for our consideration. Appellant’s counsel, appointed to represent Charlotte, who is an indigent, has asked for an assessment of fees and costs against Sedgwick County as provided by law. We find the request to be proper. The appellant’s expense for transcripts and briefs on appeal, together with a reasonable attorney fee for her counsel, are hereby assessed as costs of this appeal to be paid by Sedgwick County from the county general fund pursuant to K.S.A. 1979 Supp. 38-834b. See also In re Brehm, 3 Kan. App. 2d 325, 594 P.2d 269 (1979); In re Harris, 218 Kan. 625, 544 P.2d 1403 (1976).
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The opinion of the court was delivered by
Prager, J.:
This is an original proceeding in mandamus against Dorothy I. Van Arsdale in her official capacity as Clerk of the District Court of Sedgwick County, Kansas, which arose from her denial to plaintiffs of access to certain court files of criminal proceedings. Access to the court files was denied on the ground that K.S.A. 1979 Supp. 22-4712 and K.S.A. 1979 Supp. 21-4619 prohibited their disclosure to these plaintiffs. In this action, plaintiffs challenge the constitutionality of those statutes.
The parties have stipulated to the facts as follows:
“1. Plaintiff The Wichita Eagle and Beacon Publishing Company, Inc. is a corporation organized and existing under the laws of Kansas. Its principal place of business is 825 East Douglas, Wichita, Kansas. Plaintiff Kenneth F. Stephens is a resident and taxpayer of, and registered to vote in, Sedgwick County, Kansas.
“2. The Wichita Eagle and Beacon Publishing Company, Inc. publishes and causes to be distributed throughout the state of Kansas morning and evening newspapers of general circulation. . . . Plaintiff Stephens, at all times material, has been employed as a reporter by plaintiff newspaper and has been assigned by it to the Courts’ beat.
“3. Defendant Dorothy I. Van Arsdale is the duly appointed and presently serving Clerk of the District Court of Sedgwick County, Kansas. As such, defendant is the custodian of and charged with the duty of keeping and maintaining the court flies in criminal proceedings before the District Court of Sedgwick County, Kansas ....
“4. For many years prior to the enactment and implementation of the statutes referred to in paragraph 3 above, plaintiff newspaper, or its predecessors in interest, acting through employees such as plaintiff Stephens, in the normal course of business regularly gathered, published and sold accounts of criminal proceedings before the District Court of Sedgwick County, Kansas, including reports of arrests, preliminary proceedings, prosecutions, convictions, acquittals and appeals. A source of such published information has been the records of criminal proceedings required to be kept and maintained by defendant and by her predecessors in office. Plaintiff newspaper has regularly gathered and disseminated such information daily, and it has been purchased, directly or indirectly, for nominal consideration by members of the public.
“5. On account of the practice of gathering and publishing such information, followed as aforesaid by plaintiff newspaper, its subscribers and readers have also been provided with information concerning the course of criminal activity in their community and the administration of criminal justice by public officials elected, or appointed by those elected, whose duties include the investigation of complaints of criminal conduct, apprehension and prosecution of those charged with crimes, and adjudication of the guilt or innocence of those so charged.
“6. Plaintiff newspaper’s subscribers and readers comprise the great majority of the populace and of the electorate of Sedgwick County, Kansas, and such persons are the main source of the funds that make possible all of the activities and functions of the government of Sedgwick County, Kansas ....
“7. Defendant has denied plaintiffs access to files and records regularly kept and maintained in her office and subject to her custody and control in these specific instances:
“a) On August 8,1979 plaintiff Stephens requested permission from one of the defendant’s deputies to examine a court file containing the record of proceedings in a criminal prosecution before the District Court of Sedgwick County, Kansas that had resulted in an acquittal of two adult defendants. Permission was denied on the basis of the aforesaid Chapter 95, 1979 Session Laws of Kansas [K.S.A. 1979 Supp. 22-4712], . . .
“b) On or about August 16, 1979 plaintiff Stephens requested permission of defendant to examine the contents of files in those criminal cases that had been ‘expunged’ pursuant to orders of the District Court of Sedgwick County, Kansas. The provisions of K.S.A. 1978 Supp. 21-4619, as amended, and orders of the District Court of Sedgwick County made pursuant thereto were given by defendant as justification for denial to plaintiffs and to the public of access to those files.”
The statutes whose constitutionality is being challenged are K.S.A. 1979 Supp. 22-4712 and K.S.A. 1979 Supp. 21-4619, which provide in pertinent part as follows:
“22-4712. Disclosure of arrests not resulting in conviction; limitations. (1) Whenever any person has been arrested for the violation of any ordinance of any city, the resolution of any county in this state or any law of this state and the charges have been dismissed or the person has been found not guilty by a court or jury or where the person arrested has been released pursuant to K.S.A. 22-2406, all records of such arrest, including fingerprints and photographs of the person shall be confidential information. Such information shall not be disclosed by any officer or employee of a criminal justice agency, as defined in K.S.A. 1979 Supp. 22-4701, to anyone other than another officer or employee of such a criminal justice agency, a prosecuting attorney or to the person arrested or his or her attorney.
“(2) Except in any application for employment as a detective with a private detective agency, as defined by K.S.A. 75-7b01; as security personnel with a private patrol operator, as defined by K.S.A. 75-7b01; or with a criminal justice agency, as defined by K.S.A. 1979 Supp. 22-4701, any person so arrested may state in any application for employment, license or other civil right or privilege, or any appearance as a witness, that he or she has never been arrested for such violation.”
“21-4619. Expungement of certain convictions, (a) Except as provided in subsection (b), any person convicted in this state of a misdemeanor or a class D or E felony may petition the convicting court for the expungement of such convic tion if two or more years have elapsed since the person: (1) Satisfied the sentence imposed; or (2) was discharged from probation, parole, conditional release or a suspended sentence.
“(b) In the case of a conviction for a class A, B or C felony or any violation enumerated in subsection (a) of K.S.A. 1979 Supp. 8-285, and any amendments thereto, no person may petition for expungement until five or more years have elapsed since the person: (1) Satisfied the sentence imposed; or (2) was discharged from probation, parole, conditional release pr a suspended sentence.
“(c) When a petition for expungement is filed, the court shall set a date for a hearing thereon and shall give notice thereof to the prosecuting attorney. . . . All petitions for expungement shall be docketed in the original criminal action. Any person who may have ^relevant information about the petitioner may testify at the hearing. The court may inquire into the background of the petitioner and shall have access to any reports or records relating to the petitioner that are on file with the secretary of corrections or the Kansas adult authority.
“(d) At the hearing on the petition, the court shall order the petitioner’s conviction expunged if the court finds:
“(1) That the petitioner has not been convicted of a felony in the past two years and no proceeding involving any such crime is presently pending or being instituted against the petitioner;
“(2) that the circumstances and behavior of the petitioner warrant the expungement; and
“(3) that the expungement is consistent with the public welfare.
“(e) When the court has ordered a conviction expunged, the order of expungement shall state the information required to be contained in the petition. The clerk of the court shall send a certified copy of the order of expungement to the federal bureau of investigation, the Kansas bureau of investigation, the secretary of corrections and any other criminal justice agency who may have a record of the conviction. After the order of expungement is entered, the petitioner shall be treated as not having been convicted of the crime, except that:
“(1) Upon conviction for any subsequent crime the conviction that was expunged may be considered as a prior conviction in determining the sentence to be imposed;
“(2) in any application for employment: (A) as a detective with a private detective agency, as defined by K.S.A. 75-7b01; (B) as security personnel with a private patrol operator, as defined by K.S.A. 75-7b01; or (C) with a criminal justice agency, as defined by K.S.A. 1979 Supp. 22-4701, the petitioner, if asked about previous convictions, must disclose that the conviction took place;
“(3) the court, in the order of expungement, may specify other circumstances under which the conviction is to be disclosed; and
“(4) the conviction may be disclosed in a subsequent prosecution for an offense which requires as an element of such offense a prior conviction of the type expunged.
“(f) Whenever a person is convicted'of a crime, pleads guilty and pays a fine for a crime or is placed on parole or probation or is given a suspended sentence or conditional release, the person shall be informed of the ability to expunge the conviction.
“(g) Subject to the disclosures required pursuant to subsection (e), in any application for employment, license or other civil right or privilege, or any appearance as a witness, a person whose conviction of a crime has been expunged under this statute may state that he or she has never been convicted of such crime, but the expungement of a felony conviction does not relieve an individual of complying with any state or federal law relating to the use or possession of firearms by persons convicted of a felony.
“(h) Whenever the record of any conviction has been expunged under the provisions of this section or K.S.A. 1977 Supp. 12-4515, 21-4616, 21-4617 or the statutory predecessor of such sections, the custodian of the records of arrest, conviction and incarceration relating to that crime shall not disclose the existence of such records, except when requested by:
“(1) The person whose record was expunged;
“(2) a criminal justice agency, private detective agency or a private patrol operator, and the request is accompanied by a statement that the request is being made in conjunction with an application for employment with such agency or operator by the person whose record has been expunged;
“(3) a court, upon a showing of a subsequent conviction of the person whose record has been expunged;
“(4) a person entitled to such information pursuant to the terms of the ex-pungement order; or
“(5) a prosecuting attorney, and such request is accompanied by a statement that the request is being made in conjunction with a prosecution of an offense that requires a prior conviction as one of the elements of such offense.”
Prior to oral arguments herein the parties filed a joint statement of their respective contentions and a joint designation of the issues to be determined which essentially are as follows:
“CONTENTIONS OF PLAINTIFFS
“1. Plaintiffs have standing to bring this action in their own right ....
“2. The constitutional, common law and statutory guarantees of access to information concerning the conduct of the government and the protection afforded to the dissemination of such information were established and continue to exist in order to secure and give effect to the terms of the constitutional compact enduring between those serving from time to time as public officials and those who appoint and sustain them.
“3. The denial of access to files and records regularly kept and maintained in the office of the Clerk of the Court, Sedgwick County, Kansas, under the custody and control of said clerk violate the rights of plaintiffs, and of the members of the class they seek to represent, as guaranteed by the Bill of Rights and the Constitution of the State of Kansas and by the First and Fourteenth Amendments of the United States Constitution.
“4. The legislation relied upon as justification for the denial of access is void because:
“a) It abridges the liberty of the press with respect to the gathering and dissemination of information concerning the administration of criminal justice as such liberty existed at the time of adoption of the Constitution of this State and as it has continued to exist throughout the history of this State, in violation of the guarantee of Section 11 of the Bill of Rights that ‘The liberty of the press shall be inviolate’;
“b) It further violates the liberty of plaintiffs and of the press generally in that it denies to them the benefits of truth as a defense in civil actions for defamation, contrary to the specific guarantees of Section 11 of the Bill of Rights of this state that ‘the truth may be given in evidence to the jury’;
“c) Because of such purported legislated restriction upon the proof of truth as a defense in civil proceedings a prior restraint on publications is imposed, and the right of all persons to freely speak, write or publish their sentiments is impaired, notwithstanding the express language of Section 11, Bill of Rights;
“d) By authorizing concealment of information as to the conduct of public officials responsible for the administration of criminal justice, it frustrates the rights of self-governance retained by the people of this State, as stated generally in Section 2, Bill of Rights and specifically the rights reserved in the people to ‘consult for their common good’ and ‘to instruct their representatives,’ expressed in Section 3, Bill of Rights, and the rights of suffrage and of election provided for in Articles 4 and 5 of the Constitution.
“e) Such acts of the legislature violate the separate powers constitutionally reserved to the judiciary of this state by purporting to authorize false testimony in the course of judicial proceedings and to deny access to evidence pertinent to such proceedings;
“f) Such legislative interference with judicial trials directly violates the right of trial by jury, protected by Section 5, Bill of Rights, and infringes fundamental due process guarantees expressed in Sections 1, 2 and 18 of the Bill of Rights;
“g) Such acts of the legislature exceed the power to make laws, conferred by Article 1 of the Constitution, since the authority thereby conferred does not include the power to change that which is true to that which is false; and
“h) By purporting to direct by judicial order the erasure from public view of all evidence of convictions of crimes, such legislation infringes powers separately granted to the judiciary under Article 3 and those granted to the executive department under Article 1, Section 7.”
“ISSUES FOR DETERMINATION
“1. Does mandamus lie to compel the action sought by plaintiffs?
“2. Do plaintiffs have standing to bring this action . . .?
“3. Is [K.S.A. 1979 Supp. 22-4712] invalid as an abridgment of rights protected by the Bill of Rights and Constitution of Kansas or by the First and Fourteenth Amendments to the United States Constitution?
“4. Is [K.S.A. 1979 Supp. 21-4619] invalid as an abridgment of rights protected by the Bill of Rights and Constitution of Kansas or by the First and Fourteenth Amendments of the United States Constitution?
“5. Should the order of mandamus sought by plaintiffs issue?”
We turn now to consideration and determination of the issues.
I. Is Mandamus an Appropriate Remedy?
K.S.A. 60-801 provides:
“Mandamus is a proceeding to compel some inferior court, tribunal, board, or some corporation or person to perform a specified duty, which duty results from the office, trust, or official station of the party to whom the order is directed, or from operation of law.”
Defendant challenges the propriety of an action in mandamus to compel a public official to perform acts made unlawful by state statutes. In support of this contention defendant directs our attention to some of this court’s earlier pronouncements on mandamus as follows: Mandamus will not lie to compel a public officer to perform an unauthorized act. Johnson County Sports Authority v. Shanahan, 210 Kan. 253, 499 P.2d 1090 (1972). The remedy of mandamus is available only for the purpose of compelling the performance of a clearly defined duty resulting from the office, trust, or official station of the party to whom the order is directed, or from operation of law. The remedy may not be used to control discretion or to enforce a right which is in substantial dispute. Armstrong v. City of Salina, 211 Kan. 333, 507 P.2d 323 (1973). Mandamus will not lie if another adequate remedy at law exists (inferentially gleaned from Boylan v. Warren, Clerk, 39 Kan. 301, 307, 18 Pac. 174 [1888]).
On occasion, this court, when confronted with significant issues of statewide concern, has broadened the availability of mandamus in order to expeditiously resolve the issues. In Mobil Oil Corporation v. McHenry, 200 Kan. 211, 436 P.2d 982 (1968), this court held:
“Mandamus is a proper remedy where the essential purpose of the proceeding is to obtain an authoritative interpretation of the law for the guidance of public officials in their administration of the public business, notwithstanding the fact there also exists an adequate remedy at law.” Syl. ¶12.
“The use of mandamus to secure a speedy adjudication of questions of law for the guidance of state officers and official boards in the discharge of their duties is common in this state.” Syl. ¶13.
“Mandamus is a proceeding designed for the purpose of compelling the performance of a clearly defined duty, not involving the exercise of discretion, by a person or corporation whose duty arises out of a trust relationship, or a public or corporate responsibility.” Syl. ¶[14.
The use of mandamus to secure a speedy adjudication of questions of law for the guidance of state officers and official boards in the discharge of their duties is common in this state. Our conceptions of the proper use of mandamus to expedite the official business of the state have expanded far beyond the ancient limitations of matters justiciable in mandamus. State, ex rel., v. State Highway Comm., 132 Kan. 327, 334-35, 295 Pac. 986 (1931). Where a public official’s action or refusal to act is based upon a statute whose validity is challenged, mandamus may lie in ap propriate cases. See In re Insurance Tax Cases, 160 Kan. 300, 161 P.2d 726 (1945); Miller v. Jackson, 166 Kan. 141, 199 P.2d 513 (1948).
We have no hesitancy in concluding that the issues herein are of significant statewide concern of a recurring and ongoing nature, and the essential purpose of the proceeding is to obtain an expeditious, authoritative interpretation of the law for the guidance of public officials in the administration of the public business, and that mandamus is an appropriate remedy.
II. Do Plaintiffs have Standing to Maintain this Action?
The plaintiffs contend they have standing to maintain this action both individually and as representatives of all the citizens of Kansas. The general rules relative to the standing of a private citizen to maintain a mandamus action were set forth in Mobil Oil Corporation v. McHenry, 200 Kan. 211, Syl. ¶17, where this court stated:
“While mandamus will not ordinarily lie at the instance of a private citizen to compel the performance of a public duty, it has been held where an individual shows an injury or interest specific and peculiar to himself, and not one that he shares with the community in general, the remedy of mandamus and the other extraordinary remedies are available.”
Have plaintiffs shown some injury or interest specific and peculiar to themselves and not one that they share with the community in general? We conclude the plaintiffs have shown such injury and interest. They collect and sell news to their customers, the citizens of Kansas. The denial by the defendant to these plaintiffs of access to official court records impairs their ability to carry on their business, the collection and dissemination of information. The plaintiffs have demonstrated that they have the requisite standing to maintain this action individually.
III. Is K.S.A. 1979 Supp. 22-4712 Invalid as an Abridgment of Rights Protected by the Bill of Rights and Constitution of Kansas or by the First and Fourteenth Amendments to the United States Constitution?
Before proceeding to any constitutional questions, we must initially determine whether K.S.A. 1979 Supp. 22-4712 applies to district court criminal files. Defendant denied plaintiffs access to the court file of two adult codefendants who had been acquitted. The denial was predicated on the belief that K.S.A. 1979 Supp. 22-4712 prohibited her from permitting plaintiffs to examine the file. Defendant is an officer or employee of a criminal justice agency, as defined by K.S.A. 1979 Supp. 22-4701(c)(3), and therefore subject to various provisions of the Criminal History Record Information Act (K.S.A. 1979 Supp. 22-4701 et seq.). 22-4712 should be construed as a part of the Criminal History Record Information Act. The question before us is whether district court criminal records are “records of such arrest” as that term is used in 22-4712. If they are not, the statute is inapplicable and the constitutional issues need not be determined.
We must first determine the legislative intent as to what is included within the term “records of such arrest.” Words in common usage are to be given their natural and ordinary meaning in arriving at the proper construction of a statute. Grey v. Schmidt, 224 Kan. 375, Syl. ¶1, 581 P.2d 1180 (1978). To the average person arrest connotes physical seizure by law enforcement officers as opposed to court proceedings.
The statute makes confidential the “records of such arrest” and includes, specifically, fingerprints, and photographs taken of the person so arrested. Under the rule of “ejusdem generis,” the specific words control over general provisions in statutes unless contrary legislative intent clearly appears. Harris v. Shanahan, 192 Kan. 629, 390 P.2d 772 (1964). The language used indicates a legislative intent that confidential items should be limited to specific documents concerned primarily with the arrest, such as the officer’s report, the arrest warrant, arrest index cards of the agency involved, photographs, fingerprint cards, and “rap sheets.” The entire court file would include much more information than an arrest record. Such a broad application conceivably could be stretched to include the appellate court opinions on criminal appeals in which the defendant is released! We doubt that such was the legislative intent.
When we construe K.S.A. 1979 Supp. 22-4712 as a part of the Criminal History Record Information Act (K.S.A. 1979 Supp. 22-4701 et seq.), it is clear that the term “records of arrest,” as used in 22-4712, does not include court records of public judicial proceedings or published judicial opinions. Under K.S.A. 1979 Supp. 22-4701(b)(3), the definition section of the act, the term “criminal history record information” is specifically declared not to include “wanted posters, police blotter entries, court records of public judicial proceedings, or published court opinions. ” We also note that K.S.A. 1979 Supp. 22-4704 authorizes the director of the Kansas bureau of investigation to adopt rules and regulations for agencies in the executive branch of government and for criminal justice agencies “other than those that are part of the judicial branch of government.” 22-4707 provides for restrictions on dissemination of criminal history record information. Construing all of these statutes together, we have concluded that K.S.A. 1979 Supp. 22-4712 has no application to criminal court records of a district court and hence it imposes no restrictions on the right of the press or any other private citizens to have access to the same. Having so construed the statute, we hold that the constitutional validity of K.S.A. 1979 Supp. 22-4712 is not before the court and need not be determined in this case.
IV. Is K.S.A. 1979 Supp. 21-4619 Invalid as an Abridgment of Rights Protected by the Bill of Rights and Constitution of Kansas or by the First and Fourteenth Amendments to the United States Constitution?
The provisions of K.S.A. 1979 Supp. 21-4619 are set forth in full at the beginning of the opinion. In challenging the constitutional validity of the statute, the plaintiffs contend, in substance, that the statute violates certain rights guaranteed by the First and Fourteenth Amendments to the United States Constitution and the Kansas Bill of Rights involving freedom of the press and the right of the public to know and have information concerning the conduct of public officials responsible for the administration of criminal justice. At the outset, it should be stated that the question of access of the press to public records has been a subject of a great deal of litigation in recent years. The question of restricting public access to state court records is the subject of a comprehensive annotation at 84 A.L.R.3d 598. In that annotation, the conflicting views on the subject are set forth and many cases are cited expressing those different points of view. It would serve no useful purpose to survey the entire field of this litigation or the various positions taken by the courts. Suffice it to say, most of the basic issues involved in this case have been resolved by recent decisions of the United States Supreme Court and of this court.
Before considering the constitutionality of K.S.A. 1979 Supp. 21-4619, we deem it important to make it clear what this case does not involve. The statute does not attempt to restrain the press in the publication of any information available to or in the hands of the media or any other person. The statute does not exclude representatives of the press from any trial, nor does it close any trial from public scrutiny. The statute makes no attempt to deny representatives of the press access to the court records in a particular criminal case while that case is in the process of adjudication or prior to a finding of guilty or the imposition of sentence in the case. The statute simply provides that certain criminal records may be expunged only after the expiration of an extended period of time and only after a convicted criminal has petitioned the court and proved to the court that he has been rehabilitated and is entitled to such an expungement. With these observations in mind, we turn to the questions presented for determination.
Under the decisions of the United States Supreme Court and of this court, the right of the press or any other person to access to court records is not a right which falls within the protections afforded by the First and Fourteenth Amendments to the United States Constitution. The right of the public to access to public records for public inspection is based in our common law. Nixon v. Warner Communications, Inc., 435 U.S. 589, 597, 55 L.Ed. 2d 570, 98 S.Ct. 1306 (1978). This common-law right to inspect public records has been buttressed in many states by statutory codification. In Kansas we have K.S.A. 1979 Supp. 45-201 which provides in pertinent part as follows:
“45-201. Official public records open to inspection; exceptions; ‘official public records’ defined, (a) All official public records of the state, counties, municipalities, townships, school districts, commissions, agencies and legislative bodies, which records by law are required to be kept and maintained, except those of the district court concerning proceedings pursuant to the juvenile code which shall be open unless specifically closed by the judge or by law, adoption records, records of the birth of illegitimate children, and records specifically closed by law or by directive authorized by law, shall at all times be open for a personal inspection by any citizen, and those in charge of such records shall not refuse this privilege to any citizen.”
Simply stated, that statute requires all official public records to be open unless either closed by the judge or by some statute. The right of access to public records under such statutes has generally been held by the courts to include court records. Nixon v. Warner Communications, Inc., 435 U.S. at 597; State v. Stauffer Communications, Inc., 225 Kan. 540, 592 P.2d 891 (1979). See also the many cases cited in 20 Am. Jur. 2d, Courts §§ 61, 62 at pp. 428-429; and the annotation at 84 A.L.R.3d 598, Public Access to State Courts Records.
The right of access of the public, including the press, to court records is not absolute, as noted by the court in Nixon:
“It is uncontested, however, that the right to inspect and copy judicial records is not absolute. Every court has supervisory power over its own records and files, and access has been denied where court files might have become a vehicle for improper purposes. . . .
“[T]he decision as to access is one best left to the sound discretion of the trial court, a discretion to be exercised in light of the relevant facts and circumstances of the particular case.” pp. 598-599.
Moreover, the right of public access to court records has never been held a right of constitutional proportions in this state. In Boylan v. Warren, Clerk, 39 Kan. 301, the right of access of a citizen to public records in the office of the clerk of the court was held to be statutory. In Boylan, mandamus was issued to compel the court clerk to open court records under Section 172, Article 15, Chapter 25 of the Compiled Laws of 1885. Our present open records statute, as noted above, requires official records to be opened for inspection unless specifically closed by the judge or by law. In our recent decision in State v. Stauffer Communications, Inc., 225 Kan. 540, this court recognized the power of the legislature, not only to compel the opening of public records for public inspection, but also to restrict access to official documents. In the opinion, the court stated:
“As a general rule it may be said if the state wants to keep the press from publishing information related to its governmental functions then it must do so by protecting the confidentiality of the information. See Cox Broadcasting Corp. v. Cohn, 420 U.S. at 496, Bezanson, The New Free Press Guarantee, 63 Virginia L. Rev. 731 (1977). The state is free to do so absent some limiting statute. The Supreme Court has consistently held that ‘[n]either the First Amendment nor the Fourteenth Amendment mandates a right of access to government information or sources of information within the government’s control.’ Houchins v. KQED, Inc., 438 U.S. at 15. See also Nixon v. Warner Communications, Inc., 435 U.S. 589, 609, 55 L.Ed. 2d 570, 98 S.Ct. 1306 (1978); Pell v. Procunier, 417 U.S. 817, 834, 41 L.Ed. 2d 495, 94 S.Ct. 2800 (1974); Saxbe v. Washington Post Co., 417 U.S. 843, 41 L.Ed. 2d 514, 94 S.Ct. 2811 (1974). The First Amendment is ‘neither a Freedom of Information Act nor an Official Secrets Act.’ Stewart, Or of the Press, 26 Hastings L. J. 631, 636 (1975). (Quoted in Houchins v. KQED, Inc., 438 U.S. at 14.)” p. 545.
See also Atchison, T. & S.F. Rly. Co. v. Commission on Civil Rights, 215 Kan. 911, 529 P.2d 666 (1974), where the court holds that K.S.A. 45-201 does not require all agency documents to be open to public inspection.
Thus, this court, as well as the Supreme Court of the United States, has recognized that court records may be kept from public scrutiny under appropriate circumstances. In Nixon v. Warner Communications, Inc., 435 U.S. at 598, cases are cited holding that the common-law right of public inspection must bow before the power of a court to insure that its records will not be used “to gratify private spite or promote public scandal” through the publication of the details of a divorce case or for the publication of libelous statements for press consumption, or as sources of business information that might harm a litigant’s competitive standing. Nixon states that the decision as to access to court records is one best left to the sound discretion of the trial court, “a discretion to be exercised in light of the relevant facts and circumstances of the particular case.” p. 599.
The court having recognized the legislative and judicial authority to restrict public access to official court records in appropriate circumstances, it becomes necessary to determine whether restricting access to criminal records after a conviction has been expunged is an appropriate exercise of that authority. To determine this issue we must, of course, balance the right of the public to inspect and copy judicial criminal records against the legislative policy to expunge criminal records after the lapse of a considerable period of time and after an appropriate judicial proceeding has been conducted. We recognize, of course, the importance of public access to judicial records. Such a right should not be lightly regarded or restricted for trivial purposes. Our task is to determine whether K.S.A. 1979 Supp. 21-4619 provides a reasonable restriction on public access to certain criminal records which the court should uphold. To do so we must carefully consider the purpose of K.S.A. 1979 Supp. 21-4619 and the degree of restriction which it actually imposes.
In State v. Miller, 214 Kan. 538, 520 P.2d 1248 (1974), this court considered the underlying purpose of statutes providing for the annulment and expungement of criminal convictions such as was provided for in K.S.A. 1972 Supp. 21-4616. That statute, enacted in 1971, applied only to youthful offenders who had not yet attained the age of twenty-one years at the time of the commission of the crime. In 1973, the legislature enacted K.S.A. 1973 Supp. 21-4617 which made possible the expungement of records of adult offenders who were twenty-one years of age or older at the time of the commission of the crime. In 1978, the legislature enacted the present statute, K.S.A. 1979 Supp. 21-4619, which is now before the court for consideration. In Miller, the opinion discusses in depth the policy behind the 1971 statute using the following language:
“Over the past 50 years American correctional law, turning away from the vengeance concept, has focused increasingly on the rehabilitation of the individual offender and the development of means and practices appropriate to that end. It has become common knowledge today that a criminal record is a serious handicap which works against the rehabilitation of the ex-offender. The consequences of a criminal conviction include not only the formal penalties and restrictions imposed by law but also collateral sanctions incidentally imposed by society. Although the criminal offender has paid his debt imposed by law, society stigmatizes him with the ex-convict label. In United States v. Morgan, 346 U.S. 502, 98 L.Ed. 248, 74 S.Ct. 247, the Supreme Court of the United States pointed this out in the following language:
“ ‘. . . Of course the record of a conviction for a serious crime is often a lifelong handicap. There are a dozen ways in which even a person who has reformed, never offended again, and constantly endeavored to lead an upright life may be prejudiced thereby. The stain on his reputation may at any time threaten his social standing or affect his job opportunities . . . .’ (p. 519.)
“One author describes the problem in this manner:
“ ‘It is not the explicitly articulated disabilities which are most troublesome to the reformed offender. It is rather the less-direct economic and social reprisals engendered by his brand as an adjudicated criminal. The vagaries of public sentiment often discriminate against persons with a criminal past, with very little regard for the severity of the offense, and they do not frequently distinguish between persons arrested and acquitted or otherwise released and persons convicted. This is particularly true in the vital matter of employment, which perhaps as much as anything else influences a man’s concept of himself and his worth, and accordingly influences the values which guide his conduct.’ (Gough, The Ex-pungement of Adjudication Records of Juvenile and Adult Offenders: A Problem of Status, 1966 Wash. U.L.Q. 147 at 153.)
“For over a decade the National Council on Crime and Delinquency has urged the passage of legislation to authorize the trial courts of this country to annul a record of conviction, thus facilitating the return to normal living of an offender. The National Council drafted a model act to achieve this purpose which may be found along with a discussion of the problem in 8 Crime and Delinquency 97.
“More recently the American Bar Association Standards for Criminal Justice have recognized the necessity for such legislation. Standards for Criminal Justice relating to Probation § 4.3 provides as follows:
“ ‘4.3 Criminal record. Every jurisdiction should have a method by which the collateral effects of a criminal record can be avoided or mitigated following the successful completion of a term on probation and during its service.’ The advisory committee which drafted this standard stated that it was not as concerned with the form which such statutes take as it is with the principle that flexibility should be built into the system and that effective ways should be devised to mitigate the scarlet letter effect of a conviction once the offender has satisfactorily adjusted. Several states including Alaska, Arizona, California, Delaware, Idaho, Indiana, Michigan, Minnesota, Missouri, New Jersey, Texas, Utah, Washington, and Wyoming have already enacted progressive legislation aimed at the expungement of criminal records and annulment of related convictions. These statutes take a wide variety of forms but all are directed to the basic purpose of assisting an ex-offender to overcome the stigma of a criminal record. A procedure for setting aside a conviction is also provided in the Federal Youth Corrections Act, 18 U.S.C.A. § 5021. In Mestre Morera v. United States Immigration & Nat. Serv., (1st Cir. 1972) 462 F.2d 1030, it is stated that the purpose of that federal statute is to relieve the youthful offender not only of the usual disabilities of a criminal conviction, but also to give him a second chance free of a record tainted by such a conviction.
“In a general way it may be stated that annulment of conviction statutes, often called expungement statutes, do not merely lift disabilities resulting from conviction and restore civil rights; they have the legal effect of restoring the reformed offender to his status quo existing prior to the conviction. We think it clear that K.S.A. 1972 Supp. 21-4616 was enacted to relieve youthful offenders from the social and economic stigma resulting from criminal convictions and to offer them an added incentive to conform to social norms and to participate in our society without the added burden of a criminal conviction. An annulment of conviction statute is an aid to an ex-offender in regaining his human dignity and self-esteem. It is a legislative recognition of the fact that ex-offenders need the understanding and respect of others — not their scorn and ill will. Such statutes are based on the philosophy that fallen men can rise again and should be helped to do so.” pp. 542-544.
In Miller, we pointed out that the provisions of K.S.A. 1972 Supp. 21-4616 were permissive rather than mandatory and that a great amount of discretion was vested in the trial court in granting a defendant an annulment of his conviction. We held that the statute simply provided to the district courts of this state an additional tool to be used in the sound discretion of the court as an aid to the rehabilitation of offenders. The granting of an application for the annulment of convictions was a part of the sentencing process and, hence, a judicial function. The 1978 statute, now before us, may be distinguished from the 1971 statute in that it provides for the expungement of a conviction rather than the annulment of a conviction. Although the approach taken by the legislature to help in the rehabilitation of an offender is not exactly the same, the statutes essentially have the same purposes — the convicted criminal is provided with an incentive for rehabilitation by providing him an avenue by which he may later deny the conviction and again seek gainful employment without the added burden of a criminal conviction.
The Kansas statute providing for the expungement of a criminal conviction is not unique to this state. Other jurisdictions have, likewise, enacted expungement statutes as a legislative tool for criminal rehabilitation, apparently without constitutional challenge on First Amendment grounds. The individual statutes vary rather substantially in their terms but all are directed toward the same end. States which have enacted types of annulment and expungement of conviction statutes include:
Alaska, Alaska Stat. § 12.62.040 (1972).
Arkansas (first offender), Ark. Stat. Ann. §§ 43-1231, 43-1235 (1977).
California, Cal. Penal Code 1980 Supp. §§ 1203.4, 1203.4a (West).
Connecticut, Conn. Gen. Stat. § 54-76p (1979).
Georgia, Ga. Code Ann. 1979 Supp. § 27-2728.
Idaho, Idaho Code § 19-2604 (1979).
Illinois, Ill. Ann. Stat. 1979 Supp. ch. 38 § 1005-6-3.1 (SmithHurd).
Iowa, Iowa Code Ann. § 907.9 (West 1979).
Maryland, Md. Ann. Code 1979 Supp. art. 27 § 737.
Massachusetts, Mass. Ann. Laws 1979 Supp. ch. 276 § 100A (Michie/Law. Co-op).
Minnesota, Minn. Stat. Ann. 1980 Supp. § 364.04 (West).
Nebraska, Neb. Rev. Stat. § 29-2264 (1975).
Nevada, Nev. Rev. Stat. § 179.245 (1973).
New Jersey, N.J. Stat. Ann. 1979 Supp. § 2A: 164-28 (West).
Ohio, Ohio Rev. Code Ann. 1979 Supp. § 2953.32 (Page).
Oregon, Or. Rev. Stat. § 137.225 (1979).
Pennsylvania, Pa. R. Crim. Proc. Rules 175-185 (1979).
South Carolina, S.C. Code 1979 Supp. § 34-ll-90(e).
Utah, Utah Code Ann. § 77-35-17.5 (1978).
In considering the reasonableness of 21-4619 as a restriction on public access to criminal court records, we must consider the practical effect of the statutory provisions. It should be noted that 21-4619 restricts disclosure of records of a criminal conviction only after the conviction is ordered expunged in a judicial proceeding. Under section (a), in cases involving misdemeanors or class D or E felonies, the offender may petition the convicting court for the expungement of his conviction only if two or more years have elapsed since he either satisfied the sentence imposed or was discharged after a period of parole and probation. Under section (b), in cases involving the more serious class A, B, or C felonies, no person may petition for expungement until five years or more have elapsed since the person satisfied the sentence or was discharged after a period of probation or parole. It is difficult to see how such statutory restrictions deny the press any meaningful access to judicial proceedings or records. The public or press are free to attend the original trial or the sentencing hearing or any post-judgment hearings or the expungement proceeding itself. Section (c) provides that any person who might have relevant information about the petitioner may testify at the hearing. This affords the victim of the crime a full opportunity to be present and oppose the expungement if he so desires. If the press desires to send one of its representatives to the expungement hearing, it is free to do so.
As to the public’s right to observe and evaluate judicial performance, it would seem reasonable to say that any misconduct of the trial judge in allowing an expungement in a particular case could be more accurately observed and evaluated at the ex-pungement hearing itself rather than by laboriously pouring through the records of past cases. It again must be emphasized that the records of the conviction are fully available to the press and to the public at the time the case is filed, during all pretrial proceedings, during the trial itself, at the time sentence is imposed, during post-judgment proceedings, and, in cases of the more serious felonies involving violence, for a minimum period of five years after the offender has served his sentence or satisfactorily completed his period of probation. During all that time, the press can carry out its important function of providing the public with information which may increase a citizen’s knowledge about criminal activity and prosecutorial and judicial effectiveness or lack thereof. The records are closed by expungement only after the file has become as newsworthy as cold mashed potatoes.
It cannot be denied that the rehabilitation of criminals is a legitimate concern of the State. The legislature must be allowed a broad discretion in enacting legislation to achieve that end. We have held on many occasions that the constitutionality of a statute is presumed, that all doubts must be resolved in favor of its validity, and that, before the statute may be stricken down, it must clearly appear the statute violates the constitution. State ex rel. Schneider v. Kennedy, 225 Kan. 13, 20, 587 P.2d 844 (1978); Leek v. Theis, 217 Kan. 784, 539 P.2d 304 (1975). In determining constitutionality, it is the court’s duty to uphold a statute under attack rather than defeat it and, if there is any reasonable way to construe the statute as constitutionally valid, that should be done. Leek v. Theis, 217 Kan. at 792. Statutes are not to be stricken down unless the infringement of the superior law is clear beyond substantial doubt. State ex rel. Schneider v. Kennedy, 225 Kan. at 20. In this case, as there exists no absolute right of access to court records, the statute must be presumed constitutional. After balancing the public’s conditional right of access to court records on the one hand and the provisions of K.S.A. 1979 Supp. 21-4619 on the other, we have concluded that the restriction on public access to court records imposed thereby is reasonable and serves a valid and legitimate public purpose. We, therefore, hold that K.S.A. 1979 Supp. 21-4619 is not unconstitutional as a violation of the First or Fourteenth Amendments to the United States Constitution or of Section 11 of the Kansas Bill of Rights.
Plaintiffs contend that the statute has the effect of denying to them the right to assert truth as a defense in actions for libel and slander contrary to Section 11 of the Kansas Bill of Rights. As noted above, of necessity a minimum period of more than two years must expire after the date of conviction before a petition may be filed for expungement, even in cases involving the most minor crimes. For the more serious crimes, a minimum period of five years must expire. Under K.S.A. 60-514, an action for libel or slander must be brought within one year after the cause of action accrues. A cause of action for libel or slander accrues upon publication of the defamatory statement. Vaughan v. Hornaman, 195 Kan. 291, 298, 403 P.2d 948 (1965). Furthermore, we must recognize the inherent power which courts have over their official records. In an unusual case, where a former offender is directly involved in civil litigation, a district court might in its discretion permit the release of certain documents contained in an expunged file in order to achieve the ends of justice. That situation, of course, is not involved in this case.
Furthermore, we find no violation of the separation of powers doctrine in this legislation. We held in State v. Miller, 214 Kan. 538, that the granting or denial of an application for an annulment of a conviction is a judicial function requiring the exercise of judicial discretion. The statutory procedure for expungement of a criminal conviction likewise requires the exercise of judicial discretion. We find no sound basis for the contention that the power granted to the courts to expunge criminal records interferes with the pardoning power of the chief executive under Article 1, Section 7, of the Kansas Constitution. We find no usurpation of executive power by the judiciary. The executive power to pardon is not the same as the limited power of a court to expunge a conviction as authorized by K.S.A. 1979 Supp. 21-4619. We have, likewise, considered the other contentions advanced by the defendants and find them to be without merit.
In view of the conclusions reached by the court, the defendant, Dorothy I. Van Arsdale, Clerk of the Sedgwick County District Court, is directed to permit the plaintiffs to inspect the district court records to which access has been denied under the authority of K.S.A. 1979 Supp. 22-4712. As to those criminal records which have been expunged under the provisions of K.S.A. 1979 Supp. 21-4619, the defendant is directed to deny access to plaintiffs in accordance with the provisions of that statute. We are certain that the defendant, as Clerk of the District Court of Sedgwick County, will comply with the judgment of this court without the necessity of the issuance of a formal writ of mandamus. Should the issuance of such a writ become necessary at some time in the future, one may be obtained on application of the plaintiffs to this court.
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The opinion of the court was delivered by
McFarland, J.:
On December 20, 1973, automobiles owned and driven by plaintiff Marcia A. Traylor and defendant Millard A. Wachter collided in Wichita, Kansas. Defendant Emcasco Insurance Company is the insurer of Mr. Wachter. In April, 1975, plaintiff filed suit seeking:
Count 1 — compensatory damages against Wachter for the collision; and
Count 2 — compensatory and punitive damages against both Wachter and Emcasco for alleged tortious conduct in the handling of her claim.
On trial the jury awarded plaintiff the following: Count 1 — $55,000 compensatory damages against Wachter; and Count 2 — $50,000 punitive damages against Wachter and $100,000 punitive damages against Emcasco. The jury was polled and discharged.
Both defendants appeal. The issues relate solely to Count 2. The verdict reached in Count 1 is unchallenged and is not before us for appellate review.
ISSUE NO. 1: Did the trial court err in denying Wachter’s motion to alter, amend or reform the verdict?
Defendant Wachter contends the $50,000 punitive damage award against him in Count 2 was a mistake and that the jury intended said award to be a $50,000 compensatory damage award against defendant Emcasco. The trial court overruled Wachter’s motion to amend the verdict. The Court of Appeals, in its opinion (Traylor v. Wachter, 3 Kan. App. 2d 536, 540-41, 598 P.2d 1061 [1979]), summarized the situation as follows:
“Wachter first contends the trial court erred in denying his post-trial motion to amend, the recognized purpose of which was to correct the written verdicts to reflect what is claimed to have been the true verdicts of the jury. Wachter does not attack the actual damages verdict against him on plaintiff’s first claim. Although within its other arguments the insurer attacks that verdict obliquely, Wachter’s individual interests were separately represented by personal counsel at trial. Under the circumstances of this case, the insurer has no standing to challenge that verdict.
“The events of post-trial contacts and communications between the jury and the court, counsel for Wachter, counsel for the insurer, and a representative of the insurer need not be detailed. In support of his motion to amend, Wachter presented the affidavits of nine of the jurors and the live testimony of the other three jurors. The twelve jurors unanimously stated that their true verdicts were that plaintiff recover $55,000 actual damages against Wachter on her first claim, plaintiff recover no damages against Wachter on her second claim, plaintiff recover $50,000 actual damages against the insurer on her second claim, and plaintiff recover $100,000 punitive damages against the insurer on her second claim. The jurors agreed their verdicts were mistakenly recorded on the verdicts form.
“As the motion to amend was brought before and presented to the court, it was in the nature of a request by a party, Wachter, for a verdict correction and not a change sought by one or more jurors.
“Without abandoning alternative arguments, plaintiff agrees with Wachter that judgments should have been entered, not according to the verdicts form, but according to the true verdicts as established by the jurors’ affidavits and testimony.
“The trial court confirmed its entry of judgments in accord with the verdicts form. Change was declined on the ground the motion to amend and the presentation of the jurors’ affidavits and testimony constituted an impermissible attempt to impeach the written jury verdicts.”
The Court of Appeals then concluded the trial court erred in overruling Wachter’s motion to amend. We do not agree.
K.S.A. 60-248(g) (amended in 1978, but amendments not relevant herein) provides:
“(g) Form, of verdict; correction. The verdict shall be written, signed by the foreman, and read by the clerk to the jury, and the inquiry made whether it is their verdict. If any juror disagrees, the jury must be sent out again; but if no disagreement be expressed, and no party requires the jurors to be polled individually, the verdict is complete, and the jury discharged from the case. If, however, the verdict be defective in form only, the same may, with the assent of the jury, before they are discharged, be corrected by the court.”
The statute provides the means for correcting errors in the form of a verdict. Wachter characterizes the verdict against him as the result of a scrivener’s error. The correction of such an error must occur before the jury is discharged and with the assent of the jury. After discharge the jury no longer exists. Individuals who served on the jury are former jurors — not a jury. The trial court reached the right result for the wrong reason when it overruled the motion on the ground that it was an attempt to impeach the jury’s verdict contrary to K.S.A. 60-441. To impeach a verdict is to invalidate a verdict and thereby gain a new trial, as no valid verdict had been reached. Amendment, correction, or reformation of a verdict may not be accomplished by impeachment. We must conclude that the trial court did not err in overruling Wachter’s motion to alter, amend, or reform the verdict.
ISSUE NO. 2: Did the trial court err in concluding that the compensatory damages awarded against Wachter in Count 1 were a sufficient foundation for the award of punitive damages against both Wachter and Emcasco in Count 2?
The cause of action stated in Count 1 was personal injury and property damage suffered by plaintiff as a result of Wachter’s negligent operation of his automobile. The cause of action stated in Count 2 was aptly described by the Court of Appeals as a “mixed bag claim” mingling negligence, malice, and fraud; but the cause of action does not include Wachter’s negligent operation of his automobile. This count relates solely to alleged wrongdoings of Emcasco in its handling of the matter. We note that the separation into counts of the various allegations is not found in the petition, but evolved through pretrial order, trial and instructions. For our purposes it is sufficient to consider the causes of action as having been clearly separated and defined throughout the proceedings.
Before punitive damages may be awarded, a plaintiff must establish a right to recovery of actual damages. Webber v. Patton, 221 Kan. 79, 81, 558 P.2d 130 (1976). Punitive damages are imposed by way of punishing a party for malicious or vindictive acts or for a willful and wanton invasion of another party’s rights, the purpose being to restrain him and to deter others from the commission of like wrongs. Henderson v. Hassur, 225 Kan. 678, Syl. ¶ 9, 594 P.2d 650 (1979). The conduct giving rise to the punitive damages claim must be the same conduct for which actual or compensatory damages were allowed. Where two separate causes of action are tried, arising from different factual situations and different theories, recovery of actual damages in one cause of action is insufficient to permit recovery of punitive damages in the second cause of action. Before punitive damages could be awarded against Emcasco to punish it for the way it handled the claim, the plaintiff must recover actual or compensatory damages for the wrongful acts of the insurance company. No such recovery occurred and the $100,000 award of punitive damages against Emcasco cannot stand.
The $50,000 punitive damages award against Wachter also fails on the same rationale. In Count 1 a verdict for compensatory damages was entered against Wachter for his negligent operation of his automobile. This is a wholly separate cause of action from Count 2, which arises from the handling of the claim by his insurer (Emcasco). Additionally, evidence was wholly lacking to establish any liability on the part of Wachter for the acts of Emcasco which spawned Count 2, as will be set out in the next issue. We conclude that the verdicts awarding punitive damages against both Wachter and Emcasco must be set aside.
ISSUE NO. 3: Should judgment be entered for defendants on Count 2 or should the matter be remanded for new trial?
In making this determination we must review the facts and legal theories involved in Count 2. The accident occurred on December 20, 1973. On the afternoon of the day after the accident, plaintiff went to a local hospital. She was examined by an emergency room physician, given pain medication, instructed to sée her personal physician, and released without having been admitted. She returned to her home, telephoned her physician, and made an appointment for January 2, 1974.
On December 26, 1973, a claims employee of the insurer contacted plaintiff by telephone. He advised her he represented Wachter’s insurer. The insurer’s records reflect that the claims man learned plaintiff was “having back problems and still under doctor’s care”; and no estimate had yet been made of her car repair cost. Plaintiff testified this claims man told her to send to the insurer any medical bills she had and he suggested she take her Pontiac automobile to Scholfield Bros. Pontiac, Inc., a local automobile dealership, for a repair estimate. As per Emcasco’s request, plaintiff secured an estimate from Scholfield and advised Emcasco of the amount.
After inspecting the vehicle at Scholfield, Joe Brannon, another claims employee of defendant, spoke with plaintiff by telephone on December 27 or 28, seven or eight days after the accident. The evidence of what plaintiff and Brannon said to one another is conflicting and confusing. Without reiteration, their testimony is capable of three interpretations: (1) Nothing but repair of plaintiff’s car was discussed; (2) it was then orally agreed that plaintiff released defendants from all claims of plaintiff arising out of the accident in consideration of the insurer’s promise to pay the car repair cost and plaintiff’s medical expenses incurred within one year of the accident but not to exceed $2,000; and (3) upon plaintiff’s execution of a written release it would be agreed that plaintiff released defendants from all claims in consideration of the insurer’s promise to pay the car repair cost and plaintiff’s medical expenses incurred within one year of the accident but not to exceed $2,000. In any event, Emcasco authorized plaintiff to proceed with the repairs, based upon the estimate she provided.
Repairs on the Traylor automobile were completed on January 11, 1974. Brannon and plaintiff had a conversation that day relative to setting up a time when the two would meet at Scholfield. Brannon had a draft for repair of the Pontiac and a written release, both of which were to be signed prior to plaintiff’s picking up her automobile. The written release included the one-year limitation on medical expenses. Plaintiff knew some kind of release was involved, as she testified she understood it was to be for property damage only. The schedules of Brannon and plaintiff did not coincide, with the result that Brannon left the draft and release at Scholfield’s for signatures. When plaintiff went to Scholfield to pick up her automobile, only the draft was presented to her for signature. She endorsed the same and received her vehicle.
Within a few days thereafter, Cynthia Stark, a Scholfield employee, was putting together the paperwork to send to Emcasco and noticed the unsigned release. Without contacting either plaintiff or Emcasco, Ms. Stark forged plaintiff’s name on the release and routinely forwarded it to Emcasco. The forged release was placed in Emcasco’s claim file. Matters proceeded uneventfully until the year for payment of medical expenses passed. After the expiration of the year, plaintiff submitted another medical expense bill (December of 1974 or January of 1975). Brannon declined payment, advising plaintiff that Emcasco had no further obligation pursuant to the release. Plaintiff denied execution of a release, advised Brannon she had an attorney, and asked for a copy of the release. Brannon advised her that if her attorney requested a copy then such would be provided. Such request was made on February 21, 1975, and the copy was sent on February 26. No further communications were had until the filing of suit on April 28. Shortly after suit was filed, Emcasco contacted Scholfield and learned of the forgery. At all times after learning from Scholfield of the forgery, Emcasco has acknowledged that it is a forged document.
As previously stated, the petition herein did not divide the case into two separate causes of action. The splitting of the case into two separately enumerated causes of action occurred at pretrial. The Court of Appeals opinion, 3 Kan. App. 2d at 538-39, recites the following:
“According to the record, the pretrial conference was held on August 25, 1975. The pretrial conference order, approved by counsel for the parties and signed by the trial judge, was not filed until the first day of trial, nineteen months later. In that order, it was recited that plaintiff made two claims against the defendants.
“The first claim was for compensatory damages for physical injury and property damage resulting from the automobile accident. On this first claim, plaintiff sought recovery from Wachter only. Plaintiff and Wachter each charged the other with certain violations of rules of the road.
“The second claim was sort of a mixed bag claim in that a mingling of negligence, malice, fraud and outrage was alleged. This second claim was stated as follows:
“ ‘The plaintiff charges the defendants Wachter and Emcasco Insurance Company with the following negligent, malicious, fraudulent and outrageous actions by and through their agents and/or employees:
“ ‘A. Forgery of plaintiff’s signature to a release by defendants’ agents;
“ ‘B. Reliance upon forged release;
“ ‘C. Failure to make a good faith investigation of plaintiff’s allegations of forgery prior to suit;
“ ‘D. Fraud in lack of explanation of effect of Agreement and Release document which defendant Emcasco’s employee and defendant Wachter’s agent knew contained elements and consequences not orally explained to claimants with the further expectation that claimants would rely on said explanations of defendants’ employee and/or agent and execute said document;
“ ‘E. Attempted reliance on void general release;
“ ‘F. Attempting to negotiate a settlement with and/or obtain a general release from an injured person within fifteen (15) days of an occurrence causing injury with the knowledge that the injured person was under the care of a physician.’
“Although it appears that by way of answer and at trial the defendants claimed reliance upon an oral release by plaintiff made during the December 27 or 28, 1973, conversation, no affirmative defenses to plaintiffs second claim are stated in the pretrial order.
“Three other observations concerning the pretrial order deserve mention. The sole issue identified for determination at trial was said to be whether employees of Scholfield were agents of plaintiff, defendants, or any of them, in the transactions concerning the repair of plaintiff’s car and written release. There was no mention of punitive damages other than as may be arguably inherent in the quoted language of the order. There was no mention of questions of law to be decided in advance of or at trial.”
Defendants moved for a directed verdict on Count 2 at the close of plaintiff’s evidence and again at the close of all evidence. Both motions were denied. On appeal defendants claim error in the denial of these motions. In reviewing a motion for a directed verdict and/or a motion for judgment notwithstanding the verdict, the court must consider the evidence in a light most favorable to the opposing party. Fisher v. Sears, Roebuck & Co., 207 Kan. 493, 485 P.2d 1309 (1971). The court does not weigh evidence but must accept as true all the facts which the evidence tends to prove and draw against the party making the motion all reasonable inferences most favorable to the party opposing the motion and if the evidence is of such character that reasonable men in an impartial exercise of their judgment may reach different conclusions, then the case should be submitted to the jury. Lord v. Jackman, 206 Kan. 22, 476 P.2d 596 (1970); Springfield Tent & Awning Co. v. Rice, 202 Kan. 234, 447 P.2d 833 (1968). The appellate court must do the same. Hallett v. Stone, 216 Kan. 568, 534 P.2d 232 (1975); Apperson v. Security State Bank, 215 Kan. 724, 528 P.2d 1211 (1974).
We have carefully reviewed the record and conclude the trial court erred in overruling the motions.
Plaintiff failed as a matter of law to establish even minimally that Scholfield was the agent of either defendant. The fact Emcasco suggested that plaintiff take her Pontiac to Scholfield Bros. Pontiac, Inc., for a repair estimate does not by itself establish agency. Indeed, plaintiff testified she was to secure an estimate from Scholfield and advise Emcasco of the amount. Repairs were subsequently authorized, based on the estimate. Likewise, the fact the draft and release were left with Scholfield for execution by plaintiff does not infer agency. Plaintiff, Emcasco, and Scholfield each had individual interests in the draft. The leaving of the documents was not shown to be anything other than a mutually agreeable manner of solving a logistical problem for the convenience of all. The evidence showed such was a common practice among insurance companies.
One should also bear in mind that this was not a dispute between an insured and his insurer. Emcasco was attempting to settle with a third party (plaintiff) on behalf of its insured (Wachter). Thére are no contractual rights flowing between plaintiff and Emcasco absent a prior judgment against Wachter.
Plaintiff contends Emcasco relied on the forged release and failed to make a good faith investigation of plaintiff’s allegations of forgery prior to suit. Emcasco had no reason to suspect the release until January, 1975, when plaintiff denied signing the release. Plaintiff wanted a copy of the release and Emcasco said the same would be sent to her attorney upon request. On February 21 the request was made and the release was sent on February 26. Emcasco heard nothing further until suit was filed. Actionable conduct? We think not.
Plaintiff also claims the failure of Scholfield employees or Brannon to explain the legal effect of the release to plaintiff was fraudulent. This is the release plaintiff never saw but which was forged by Stark. This is not a situation where plaintiff signed the release by virtue of misrepresentation. All parties agree plaintiff did not sign the release. Actionable conduct? We think not.
This brings us to the claims arising from the earlier oral release in contravention of K.S.A. 60-2801. The statute reads:
“(a) Within fifteen (15) days of the date of the occurrence causing injury to any person, who either is under the care of a person licensed to practice the healing arts, or is confined to a hospital or sanitarium as a patient, no person whose interest is or may become adverse to the injured person shall:
“(1) Negotiate or attempt to negotiate a settlement with the injured patient; or
“(2) obtain or attempt to obtain a general release of liability from the injured pátient.
“(b) Any settlement agreement entered into, any general release of liability or any written statement made by any person who is under the care of a person licensed to practice the healing arts or is confined in a hospital or sanitarium after he or she incurs a personal injury, which is not obtained in accordance with the provisions of K.S.A. 60-2802, may be disavowed by the injured person within fifteen (15) days after discharge from the care of any person licensed to practice the healing arts or after release from the hospital or sanitarium, whichever occurs first, and such statement, release or settlement shall not be received in evidence in any court action relating to the injury.”
The oral release was not asserted until after suit was filed. It is unclear exactly at what point the matter of the oral release crept into the litigation and for what purpose it came in. Plaintiff consistently maintains no such oral release was given by her, but seeks to impose liability on Emcasco for relying on the release she maintains never existed. The Court of Appeals concluded that violation of K.S.A. 60-2801(<z) does not give rise to a separate cause of action and we concur in that determination. Accordingly, it is unnecessary to explore the nuances of this claim.
We must conclude that the trial court erred in overruling defendants’ motion for directed verdicts on Count 2. Having reached this result, we further conclude that remanding the case for a new trial on Count 2 would be inappropriate and that the defendants are entitled to judgment on Count 2.
The $55,000 judgment against Wachter in Count 1 is not an issue before us and stands undisturbed. As to Count 2, the judgments of the district court and the Court of Appeals are reversed. Judgment is entered in favor of defendants on Count 2. Costs are taxed to defendants. By virtue of the results reached herein, other issues raised need not be determined. | [
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The opinion of the court was delivered by
Herd, J.:
This case is filed in the United States District Court for the District of Kansas and comes to this court by certification from the United States District Court under authority of the Uniform Certification of Questions of Law Act. K.S.A. 1979 Supp. 60-3201 et seq. The certifying court shows by its order it has jurisdiction of the parties and the subject matter of this suit and that the law of Kansas controls the substantive legal issues of the case. Erie R. Co. v. Tompkins, 304 U.S. 64, 82 L.Ed. 1188, 58 S.Ct. 817 (1938).
Plaintiff insured’s complaint alleges two causes of action: 1) breach of contract; and 2) the tort of “bad faith” against the defendant insurance company arising out of a fire loss to a house covered by an insurance policy issued by defendant. The case is before the trial court upon defendant’s motion to dismiss or, in the alternative, for summary judgment. The motion does not go to the breach of contract issue but tests only the question of whether Kansas law recognizes the tort of “bad faith.” The certifying court states it appears there is no controlling precedent in the decisions of the appellate courts of this state on this question of law.
We accepted certification pursuant to K.S.A. 1979 Supp. 60-3201 et seq. Those statutes provide:
“60-3201. Power to answer. The Kansas supreme court may answer questions of law certified to it by the supreme court of the United States, a court of appeals of the United States, a United States district court or the highest appellate court or the intermediate appellate court of any other state, when requested by the certifying court if there are involved in any proceeding before it questions of law of this state which may be determinative of the cause then pending in the certifying court and as to which it appears to the certifying court there is no controlling precedent in the decisions of the supreme court and the court of appeals of this state.
“60-3202. Method of invoking. This act may be invoked by an order of any of the courts referred to in K.S.A. 1979 Supp. 60-3201 upon the court’s own motion or upon the motion of any party to the cause.
“60-3203. Contents of certification order. A certification order shall set forth the questions of law to be answered and a statement of all facts relevant to the questions certified and showing fully the nature of the controversy in which the questions arose.
“60-3204. Preparation of certification order. The certification order shall be prepared by the certifying court, signed by the judge or justice presiding at the hearing, and forwarded to the Kansas supreme court by the clerk of the certifying court under its official seal. The Kansas supreme court may require the original or copies of all or of any portion of the record before the certifying court to be filed with the certification order, if, in the opinion of such court, the record or portion thereof may be necessary in answering the questions. The proceedings in the Kansas supreme court shall have precedence over all other hearings therein, except those of like character.”
It is well established that appellate courts review only actual cases or controversies. To do otherwise would involve giving advisory opinions, which is constitutionally forbidden. NEA-Topeka, Inc. v. U.S.D. No. 501, 227 Kan. 529, 607 P.2d 40 (1980). The U.S. Supreme Court has recognized an exception to that rule “if the underlying dispute between the parties is one ‘capable of repetition, yet evading review.’ ” Nebraska Press Assn. v. Stuart, 427 U.S. 539, 546, 49 L.Ed.2d 683, 96 S.Ct. 2791 (1976); Gannett Co. v. DePasquale, 443 U.S. 368, 61 L.Ed.2d 608, 99 S.Ct. 2898 (1979); Southern Pacific Terminal Co. v. ICC, 219 U.S. 498, 515, 55 L.Ed. 310, 31 S.Ct. 279 (1911). This question arises from an actual case and controversy and although presented as a question of law, it neither violates the case or controversy requirement nor the separation of powers doctrine on advisory opinions.
Let us now turn to the question. Does Kansas recognize the tort of “bad faith”? The facts of the case are unnecessary for determination of this issue. The recognition of bad faith as an independent tort is a recent development in the law in response to the quest for “every wrong a remedy.” See generally Note, Insurer’s Bad Faith: A New Tort for KansasP, 19 Washburn L. J. 467 (1980). In jurisdictions where bad faith has been adopted, it applies only as a remedy for an insured who feels mistreated at the hands of his insurance carrier. It has been noted that:
“Traditionally insurance policies were regarded as contracts for the payment of money upon the occurrence of specific contemplated risks. In an action for breach of an insurance contract, the plaintiff’s recovery was limited to the benefits due under the contract plus interest. He could not recover damages for economic loss, emotional distress, or punitive damages regardless of injury to his health, feelings, reputation, or property; such damages were considered too remote.” Murphy, The Emerging Fiduciary Obligations and Strict Liability in Insurance Law, 14 Cal. W. L. Rev. 358 (1978).
The traditional rule limited an insured to contract remedies which are the face amount of the policy plus interest. The growing public awareness, however, of abusive delays by insurance companies in paying legitimate claims has given rise to the demand for a vehicle to recompense the injured for his damages. See Savage, The Availability of Excess Damages for Wrongful Refusal to Honor First Party Insurance Claims — An Emerging Trend, 45 Fordham L. Rev. 164, 166 (1972).
California courts laid the foundation for the extension of the bad faith tort from third party to first party situations. See Comunale v. Traders & General Ins. Co., 50 Cal. 2d 654, 328 P.2d 198 (1958); Crisci v. Security Ins. Co., 66 Cal. 2d 425, 58 Cal. Rptr. 13, 426 P.2d 173 (1967); Fletcher v. Western National Life Ins. Co., 10 Cal. App. 3d 376, 89 Cal. Rptr. 78 (1970); Richardson v. Employers Liab. Assur. Corp., 25 Cal. App. 3d 232, 102 Cal. Rptr. 547 (1972).
This line of cases culminated in the decision in Gruenberg v. Aetna Ins. Co., 9 Cal. 3d 566, 108 Cal. Rptr. 480, 510 P.2d 1032 (1973), which firmly established the concept of the bad faith tort in first party insurance situations. The court in Gruenberg at page 574 stated:
“It is the obligation, deemed to be imposed by the law, under which the insurer must act fairly and in good faith in discharging its contractual responsibilities. Where in so doing, it fails to deal fairly and in good faith with its insured by refusing, without proper cause, to compensate its insured for a loss covered by the policy, such conduct may give rise to a cause of action in tort for breach of an implied covenant of good faith and fair dealing.”
The following decisions stand out among those which have either expressly adopted Gruenberg or have embraced similar positions: Craft v. Economy Fire & Cas. Co., 572 F.2d 565 (7th Cir. 1978) (Indiana law); Eckenrode v. Life of America Ins. Co., 470 F.2d 1 (7th Cir. 1972) (Illinois law); Phillips v. Aetna Life Ins. Co., 473 F. Supp. 984 (D. Vt. 1979) (Vermont law); Robertsen v. State Farm Mut. Auto Ins. Co., 464 F. Supp. 876 (D.S.C. 1979) (South Carolina law); Escambia Treating Co. v. Aetna Cas. & Sur. Co., 421 F. Supp. 1367 (N.D. Fla. 1976) (Florida law); Corwin Chrysler-Plymouth v. Westchester Fire, 279 N.W.2d 638 (N.D. 1979); Anderson v. Continental Ins. Co., 85 Wis.2d 675, 271 N.W.2d 368 (1978); Christian v. American Home Assur. Co., 577 P.2d 899 (Okla. 1978); MFA Mut. Ins. Co. v. Flint, 574 S.W.2d 718 (Tenn. 1978); Grand Sheet Metal, Etc. v. Protection Mut. Ins., 34 Conn. Supp. 46, 375 A.2d 428 (1977); Diamon v. Penn. Mut. Fire Ins. Co., 247 Pa. Super. Ct. 534, 372 A.2d 1218 (1977); Vernon Fire & Cas. Ins. Co. et al. v. Sharp, 264 Ind. 599, 349 N.E.2d 173 (1976); United States Fidelity v. Peterson, 91 Nev. 617, 540 P.2d 1070 (1975); Ledingham v. Blue Cross, 29 Ill. App. 3d 339, 330 N.E.2d 540 (1975), rev’d on other grounds 64 Ill. 2d 338, 356 N.E.2d 75 (1976); United Services Automobile Assoc. v. Werley, 526 P.2d 28 (Alaska 1974); Amsden v. Grinnell Mutual Reinsurance Co., 203 N.W.2d 252 (Iowa 1972); Kirk v. Safeco Ins. Co., 28 Ohio Misc. 44, 273 N.E.2d 919 (1970); and see Gibson v. Nat. Ben Franklin Ins. Co., 387 A.2d 220 (Me. 1978).
The cases adopting the bad faith tort generally cite the following reasons for its adoption: First, in the absence of such a tort an insurance company can arbitrarily deny coverage and delay payment of a claim with no more penalty than interest on the amount owed. Note, The Availability of Excess Damages for Wrongful Refusal to Honor First Party Insurance Claims — An Emerging Trend, 45 Fordham L. Rev. 164, 166 (1972). Secondly, since there is uneven bargaining power between an insured and its insurer, the insured needs the extra leverage the tort of bad faith would provide to even his position. Craft v. Economy Fire & Cas. Co., 572 F.2d 565, 569; Grand Sheet Metal Products Co. v. Protection Mut. Ins. Co., 34 Conn. Supp. 46,375 A.2d at 430. It has also been argued insurance contracts are contracts of adhesion. D’Ambrosio v. Pa. Nat. Mut. Cas. Ins. Co., _ Pa. Super. Ct. _, 396 A.2d 780, 785 (1978). Third, a bad faith cause of action is justified because of the nature of the insurance industry, which is imbued with the public interest. Eckenrode v. Life of America Ins. Co., 470 F.2d 1, 5; Grand Sheet Metal Products Co. v. Protection Mutual Insurance Co., 34 Conn. Supp. 46, 375 A.2d at 430. Fourth, an insured is usually suffering from physical injury or economic loss when bargaining with the insurance company, and the vulnerable position justifies the additional remedy of a bad faith cause of action. Grand Sheet Metal Products Co. v. Protection Mut. Ins. Co., 34 Conn. Supp. 46, 375 A.2d at 430. A fifth rationale is the recognition of the bad faith tort in third party situations justifies its recognition in first party situations. Escambia Treating Co. v. Aetna Cas. & Sur. Co., 421 F. Supp. at 1370; Anderson v. Continental Ins. Co., 85 Wis. 2d at 688. Finally, when an insured purchases insurance, he is purchasing more than financial security; he is purchasing peace of mind. Therefore, the extra remedy of bad faith is needed to insure he receives the benefit of his bargain. Eckenrode v. Life of America Ins. Co., 470 F.2d at 5; D’Ambrosio v. Pa. Nat. Mut. Cas. Ins. Co., _ Pa. Super. Ct. _, 396 A.2d at 786.
Essentially, all arguments for the adoption of bad faith tort pertain to the unequal bargaining position of insured and insurer and the public interest nature of the industry.
On the other hand there are numerous jurisdictions which have refused to recognize the tort of bad faith as an independent cause of action in first party cases. The following constitute the majority of the significant cases which have rejected Gruenberg: Wilson v. Colonial Penn. Life Ins. Co., 454 F. Supp. 1208 (D. Minn. 1978) (applying Minnesota law); A.A.A. Pool Service & Supply, Inc., v. Aetna Cas. & Sur. Co., _ R.I. _, 395 A.2d 724 (1978); Farris v. U.S. Fid. and Guar. Co., 284 Or. 453, 587 P.2d 1015 (1978); Lawton v. Great Southwest Fire Ins. Co., 118 N.H. 607, 392 A.2d 576 (1978); Debolt v. Mutual of Omaha, 56 Ill. App. 3d 111, 371 N.E.2d 373 (1978); Craig v. Iowa Kemper Mut. Ins. Co., 565 S.W.2d 716 (Mo. App. 1978) (only suggesting that Missouri law does not support bad faith tort); MacDonald v. Penn Mutual Life Insurance Company, 276 So. 2d 232 (Fla. App. 1973).
These cases have rejected recognition of the tort for the fol lowing reasons: First, the rationale behind a bad faith claim in a third party situation is not applicable to first party situations. Farris v. U.S. Fid. and Guar. Co., 284 Or. at 460; Lawton v. Great Southwest Fire Ins. Co., 118 N.H. at 614. Second, some courts conclude that the “peace of mind” argument does not justify a bad faith cause of action in insurance cases because every contract is entered into for peace of mind. Farris at 465. Third, some cases reject the argument that the insurance industry is imbued with public interest justifying the recognition of the tort of bad faith. Farris at 467.
The “adhesion contract” argument was rejected in at least one case on the grounds the insurance policy in question had been approved and therefore, could not be considered an “adhesion contract.” See A.A.A. Pool Service & Supply, Inc. v. Aetna Cas. & Sur. Co., _ R.I. _, 395 A.2d at 726.
The most widely used argument against recognition of the tort of bad faith is that many states have enacted statutory penalties against companies which fail without good cause to settle claims with their insureds. It is argued these legislative remedies are exclusive, thus eliminating the need for other remedies. A.A.A. Pool Service & Supply, Inc. v. Aetna Cas. & Sur. Co., _ R.I. _, 395 A.2d at 726; Farris v. U.S. Fid. and Guar. Co., 284 Or. at 458; Lawton v. Great Southwest Fire Ins. Co., 118 N.H. at 614-15. In Debolt v. Mutual of Omaha, 56 Ill. App. 3d at 116, the court stated:
“We are of the opinion that the legislature has intended to provide a remedy to an insured who encounters unnecessary difficulties with an unreasonable and vexatious insurance company. The insured can maintain an action on the contract for recovery of withheld policy benefits and upon proper finding by the court can be awarded attorney fees in addition to all other costs. Where the legislature has provided a remedy on a subject matter we are not only loath but in addition harbor serious doubts as to the desirability and wisdom of implementing or expanding the legislative remedy by judicial decree.”
It has been held that traditional compensatory damages for breach of contract are adequate and that the additional remedy of bad faith tort is unnecessary. Lawton v. Great Southwest Fire Ins. Co., 118 N.H. at 613. Finally, it has been noted that the tort of outrage, which has been adopted in Kansas, and the tort of bad faith provide remedies for the same wrongs and they are in fact mixed concepts used somewhat interchangeably. See, e.g., Lavoie v. Aetna Life & Cas. Co., Inc., 374 So. 2d 310, 312 (Ala. 1979) (concurring opinion of Jones, J.); Restatement (Second) of Torts § 46 (1965).
Let us now turn to Kansas law. We have traditionally held that only contractual damages are available for breach of an insurance contract and that such damages do not include mental anguish or punitive damages. Moffet v. Kansas City Fire & Marine Ins. Co., 173 Kan. 52, 244 P.2d 228 (1952). In Moffet this court considered an action brought by a policy holder against his insurance company to recover for the loss of a combine, for punitive damages and attorney’s fees. Plaintiff alleged his combine had been wrecked and, pursuant to the terms of his policy with the insurance company, he attempted to collect from them but they “wilfully and wantonly refused to pay him for the damages suffered.” Moffet at 54. In that case, this court stated:
“As a general rule, damages for breach of contract are limited to pecuniary loss sustained. According to the overwhelming weight of authority exemplary or punitive damages are not recoverable in actions for breach of contract in the absence of independent tort or wrong causing additional injury and in a few other situations not present here.” Moffet at 57.
In Hess v. Jarboe, 201 Kan. 705, Syl. ¶ 2, 443 P.2d 294 (1968), this court stated:
“A party may recover punitive damages . . . when some independent tort results in additional injury and such tortious act indicates malice, fraud or wanton disregard for the rights of others.”
See also Nordstrom v. Miller, 227 Kan. 59, 605 P.2d 545 (1980); Temmen v. Kent-Brown Chevrolet Co., 227 Kan. 45, 605 P.2d 95 (1980); Modern Air Conditioning, Inc. v. Cinderella Homes, 226 Kan. 70, 596 P.2d 816 (1979); Dold v. Sherow, 220 Kan. 350, 552 P.2d 945 (1976); Hass v. Preferred Risk Mutual Insurance Company, 214 Kan. 747, 522 P.2d 438 (1974).
The courts have found that a liability insurer has a fiduciary relationship with its insured. In settling and defending actions against the insured, an insurer must act in the best interests of its insured. With respect to the third-party situation concerning an insurer’s duty to defend its insured and the duty of good faith dealing between the insured and the insurer, we stated in Bollinger v. Nuss, 202 Kan. 326, Syl. ¶ 1, 449 P.2d 502 (1969):
“In defending and settling claims against its insured, the insurer of a liability or indemnity policy owes to the insured the duty to act in good faith and without negligence; failure to do so will result in the insurer being held liable for the full amount of the insured’s resulting loss, even if that amount exceeds policy limits.”
At Syl. ¶ 9, the court stated:
“Whether an insurer in defending a claim and refusing an offer of settlement within policy limits was negligent or acted in bad faith is a question for the trier of fact in each case, and the findings of the lower court, when supported by substantial, competent evidence, will not be disturbed on appeal.”
The language in Bollinger at 332-34, discussing the rationale for the duty to act in good faith in a third party case, distinguishes this case from a duty in a first party situation:
“A later case, Bennett v. Conrady, 180 Kan. 485, 305 P.2d 823, involved an insurer’s liability in the settlement of less than all of several claims against its insured. There, for the first time, the court spoke of bad faith, as well as negligence, and stated the rule to be applied was that the insurer of a liability or an indemnity policy would be liable for the full amount of its insured’s resulting loss, even if that amount exceeds the limit of the policy, for negligence or bad faith in defending or settling an action against the insured. The court noted that once the insurer steps into the negotiations between its insured and an injured claimant, due care must be exercised by the insurer to protect the rights of the insured. The degree of care to be exercised by the insurer in the settlement of claims was said to be that which a person of ordinary care and prudence would exercise in the management of his own affairs. The opinion emphasizes the wide variation in the decisions applying the negligence test or good faith test in respect to the duty of the insurer to consider the interests of the insured in approving or rejecting a settlement within policy limits. The court also stated:
‘Because of the possible conflict of interest between an insurance company and its insured in the defense or settlement of claims against the insured there is a mutual fiduciary relationship whereby each owes the other the duty to exercise reasonable care in conducting such defense or settlement.’ (Syl. ¶ 5.)
Under the facts and circumstances of that case the court concluded the insurance company exercised due care to protect the rights of its insured and acted in good faith in making the settlements.
“The Anderson and Bennett cases have apparently led to some confusion among the annotators and text-writers as to whether Kansas recognizes both the negligence test and the good faith test. [Citations omitted.] We read these cases to mean that liability may be imposed against the insurer on either theory. In other words, the insurer, in defending and settling claims against its insured, owes to the insured the duty not only to act in good faith but also to act without negligence.
“In the vast majority of cases passing upon the question, the courts have held that a liability insurer, having assumed control of the right of settlement of claims against the insured, may become liable in excess of its undertaking under the policy provisions if it fails to exercise good faith in considering offers to compromise the claim for an amount within the policy limits. [Citation omitted.] While some courts have expressly rejected the negligence test and permitted recovery only if the insurer has failed to exercise good faith [citations omitted], we are not inclined to do so. Public policy dictates that the insured’s interests be adequately protected, and we believe this may be best accomplished by holding that both due care and good faith are required of the insurer in reaching the decision not to settle. [Citations omitted.]
“The imposition of liability against an insurer for failing to exercise due care in settling a suit is perhaps a stringent standard by which to measure the insurer’s duty. In fact, it has been said less culpability is involved in the application of the negligence test than the good faith test. [Citation omitted.] It must be remembered, however, that the insured has surrendered a valuable right: that of conducting an investigation and considering possible offers of settlement. Since the absolute control of the defense is turned over to the insurer so that it may reject settlements within policy limits, and as a result, expose the insured to payment of all sums in excess of policy limits, surely it is not asking too much to require the insurer to act without negligence.”
It is clear this court has adopted the rationale that in third party claims an insurer, in defending and settling claims against its insured, owes a duty to the insured not only to act in good faith but also to act without negligence. Farmers Ins. Exchange v. Schropp, 222 Kan. 612, 567 P.2d 1359 (1977); Rector v. Husted, 214 Kan. 230, 519 P.2d 634 (1974); Castoreno v. Western Indemnity Co. Inc., 213 Kan. 103, 515 P.2d 789 (1973); Bollinger v. Nuss, 202 Kan. 326. Although those duties are well established in a third party situation, Kansas cases have not gone so far as to find that the lack of good faith by an insurer in dealings on behalf of his insured rises to the level of an independent tort. Thus, the remedies available to a wronged insured in that instance remain limited to the insured’s loss, even though that loss exceeds policy limits. There are, however, no Kansas cases adopting that rationale in first party situations.
The first party relationship is distinguishable from the third party situation. In third party claims, the absolute control of the trial and settlement is in the hands of the insurer. That control gives rise to a fiduciary relationship between the insurer and its insured. In first party claims the insurer is not in a position to expose the insured to a judgment in excess of policy limits through its unreasonable refusal to settle a case nor is the insurer in exclusive control of the defense. Although an insurer must make a good faith attempt to settle claims (K.S.A. 40-2404[9][f]), the insured and insurer in a first party relationship have an adversary relationship, rather than a fiduciary relationship.
Turning to the question of the existence of a bad faith tort in first party situations, we note this court is faced squarely with the question of whether there are wrongs being committed by insurance companies against their insureds for which there is no adequate remedy under present law. If so, should the courts provide a remedy? To answer the first question, let us examine the remedies provided by statute. First, we'must recognize that the Kansas legislature has long recognized" the insurance industry is imbued with the public interest as evidenced by the creation in 1927 of the Kansas Department of Insurance. The department is charged with the duty of regulating insurance companies, all of which must be licensed to do business in Kansas. Illustrations of that regulation are found in the following statutes: K.S.A. 40-219 provides an insurance company may be enjoined from doing any business in this state if it fails to pay a loss within three months after final judgment. The injunction against doing business shall continue until the judgment is fully paid. K.S.A. 40-254 provides any person may be fined $500 and/or imprisoned six months for violation of the act.
The following statutes provide for the recovery of attorneys’ fees: K.S.A. 40-256 provides the insurance company must pay attorneys’ fees for an insured who obtains a judgment against it where the company refused to pay the full amount of loss without just cause or excuse. K.S.A. 40-908 provides attorneys’ fees may be recovered by a plaintiff where judgment is rendered against a company on a policy insuring property against certain losses. See generally the following cases which have applied these statutes regarding attorneys’ fees: Van Hoozer v. Farmers Ins. Exchange, 219 Kan. 595, 549 P.2d 1354 (1976); Farm Bureau Mutual Ins. Co. v. Carr, 215 Kan. 591, 528 P.2d 134 (1974); Sloan v. Employers Casualty Ins. Co., 214 Kan. 443, 521 P.2d 249 (1974); Venable v. Import Volkswagen, Inc., 214 Kan. 43, 519 P.2d 667 (1974); Forrester v. State Farm Mutual, 213 Kan. 442, 517 P.2d 173 (1973); Lattner v. Federal Union Insurance Co., 160 Kan. 472, 163 P.2d 389 (1945); Hand v. State Farm Mutual Automobile Ins. Co., 2 Kan. App. 2d 253, 577 P.2d 1202, rev. denied 225 Kan. 844 (1978). Finally, K.S.A. 1979 Supp. 40-3111 provides attorneys’ fees for advising and representing a claimant in an action to recover overdue personal injury protection benefits may be charged against an insurer or self-insurer “if the court finds that the insurer or self-insurer unreasonably refused to pay the claim or unreasonably delayed in making proper payment.”
K.S.A. 40-2401 through 40-2414 encompass relevant statutes in an act designed “to regulate trade practices in the business of insurance ... by defining, or providing for the determination of, all such practices in this state which constitute unfair methods of competition or unfair or deceptive acts or practices and by prohibiting the trade practices so defined or determined.” K.S.A. 40-2401.
K.S.A. 40-2404 defines the “unfair methods of competition and unfair or deceptive acts or practices in the business of insurance,” prohibited by K.S.A. 40-2403. Our attention is particularly drawn to K.S.A. 40-2404(9) regarding unfair claim settlement practices, which states:
“Unfair settlement practices. Committing or performing with such frequency as to indicate a general business practice of any of the following:
“(a) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue;
“(b) failing to acknowledge and act reasonably promptly upon communications with respect to claims arising under insurance policies;
“(c) failing to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies;
“(d) refusing to pay claims without conducting a reasonable investigation based upon all available information;
“(e) failing to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed;
“(f) not attempting in good faith to effectuate prompt, fair and equitable settlements of claims in which liability has become reasonably clear;
“(g) compelling insureds to institute litigation to recover amounts due under an insurance policy by offering substantially less than the amounts ultimately recovered in actions brought by such insureds;
“(h) attempting to settle a claim for less than the amount to which a reasonable man would have believed he was entitled by reference to written or printed advertising material accompanying or made part of an application;
“(i) attempting to settle claims on the basis of an application which was altered without notice to, or knowledge or consent of the insured;
“(f) making claims payments to insureds or beneficiaries not accompanied by a statement setting forth the coverage under which payments are being made;
“(k) making known to insureds or claimants a policy of appealing from arbitration awards in favor of insureds or claimants for the purpose of compelling them to accept settlements or compromises less than the amount awarded in arbitration;
“(l) delaying the investigation or payment of claims by requiring an insured, claimant, or the physician of either to submit a preliminary claim report and then requiring the subsequent submission of formal proof of loss forms, both of which submissions contain substantially the same information;
“(m) failing to promptly settle claims, where liability has become reasonably clear, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage;
“(n) failing to promptly provide a reasonable explanation of the basis in the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement.”
We noted in our foregoing discussion, K.S.A. 40-2404(9)(J) recognizes the importance of an insurer’s good faith in effectuating “prompt, fair and equitable settlements of claims in which liability has become reasonably clear.” This statute deals directly with the situation now before us. When the commissioner of insurance has reason to believe any person engaged in the business of insurance in this state has participated or is participating in unfair methods of competition or unfair or deceptive acts or practices “whether or not defined in section 3 [40-2404] of this act,” a statement of charges and notice of hearing is served upon such person. K.S.A. 40-2406(c). The person so served shall have an opportunity to be heard and “to show cause why an order should not be made by the commissioner requiring such person to cease and desist from the acts, methods or practices so complained of.” K.S.A. 40-2406(b). K.S.A. 1979 Supp. 40-2407 provides the penalties for violation of the foregoing as follows:
“40-2407. Unfair methods of competition or unfair and deceptive acts or practices; cease and desist orders; penalties; suspension or revocation of license; modification of commissioner’s orders, (a) If, after such hearing, the commissioner shall determine that the person charged has engaged in an unfair method of competition or an unfair or deceptive act or practice, such commissioner shall reduce his or her findings to writing and shall issue and cause to be served upon the person charged with the violation a copy of such findings and an order requiring such person to cease and desist from engaging in such method of competition, act or practice and if the act or practice is a violation of K.S.A. 40-2404, the commissioner may in the exercise of discretion order any one or more of the following:
“(1) Payment of a monetary penalty of not more than one hundred dollars ($100) for each and every act or violation; but not to exceed an aggregate penalty of two thousand five hundred dollars ($2,500), unless the person knew or reasonably should have known he or she was in violation of this act, in which case the penalty shall be not more than one thousand dollars ($1,000) for each and every act or violation, but not to exceed an aggregate of ten thousand dollars ($10,000) in any six-month period;
“(2) suspension or revocation of the person’s license if such persoh knew or reasonably should have known he or she was in violation of this act; or
“(3) redress of an injury by requiring the refund of any premiums paid by and/or the payment of any moneys withheld from, any consumer and/or appropriate public notification of the violation.
“(b) Until the expiration of the time allowed under subsection (a) of K.S.A. 40-2408 for filing a petition for review if no such petition has been duly filed within such time or, if a petition for review has been filed within such time, then until the transcript of the record in the proceeding has been filed in the district court, as hereinafter provided, the commissioner may at any time, upon such notice and in such manner as the commissioner shall deem proper, modify or set aside in whole or in part any order issued under this section.
“(c) After the expiration of the time allowed for filing such a petition for review if no such petition has been duly filed within such time, the commissioner may at any time, after notice and opportunity for hearing, reopen and alter, modify or set aside, in whole or in part, any order issued under this section, whenever in the commissioner’s opinion conditions of fact or of law have so changed as to require such action or if the public interest shall so require.”
In addition, K.S.A. 1979 Supp. 40-2411 provides penalties for violation of cease and desist orders.
The legislature has recognized the public interest nature of the insurance industry and has also recognized policy holders require protection because of their inequitable bargaining position. The penalties, including fines and imprisonment, and imposition of attorneys’ fees are adequate to protect the public from the actions of a recalcitrant insurer in first party cases. We do not say the legislative remedy is exclusive but in the absence of a more definitive showing of inadequacy of the remedy than we have before us at this time, we hold the remedies are adequate to force compliance with the terms of insurance contracts.
We are of the opinion the legislature has intended to provide a remedy for an insured who has problems with his insurance company. He can maintain an action on the contract for his policy benefits, with costs, interest and attorneys’ fees under arbitrary circumstances. He may also report the company to the Department of Insurance under the Uniform Trade Practices Act for improper handling of claims pursuant to K.S.A. 40-2404(9). The company’s actions are reviewable by the Department and punishable if found improper. The legislature has provided several remedies for an aggrieved insured and has dealt with the question of good faith first party claims. Statutory law does not indicate the legislature intended damages for emotional suffering to be recoverable by an aggrieved insured through a tort of bad faith. Where the legislature has provided such detailed and effective remedies, we find it undesirable for us to expand those remedies by judicial decree.
We hold the tort of bad faith is not recognized in Kansas.
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The opinion of the court was delivered by
Miller, J.:
Heart Ministries, Inc. and William and Carol Cowell appeal from the issuance of a permanent injunction against them by the trial court. The propriety of that order is attacked on numerous grounds, one of which we believe to be determinative: whether the licensing requirement of K.S.A. 1979 Supp. 65-501 and the fee requirements of K.S.A. 1979 Supp. 65-505 violate appellants’ rights under the “free exercise” clause of the First Amendment to the Constitution of the United States.
The State, through the county attorney of Reno County, brought this action in June, 1977, praying for an injunction prohibiting the defendants, Heart Ministries and the Reverend and Mrs. Cowell, from operating, maintaining, or holding themselves out to the public as operating or maintaining a maternity hospital, a home, a boarding home, or a placement agency for juveniles under the age of 16, until defendants obtain a state license for such operations. The petition also sought an injunction prohibiting defendants from bringing children under the age of 18 into Kansas for placement in foster care in this state until defendants comply with the Interstate Compact on the Placement of Children, K.S.A. 1979 Supp. 38-1202.
Victory Village Home for Girls was originally designated as a defendant. The trial court found that Victory Village Home for Girls is not a separate legal entity, but merely a name used by Heart Ministries. Victory Village Home for Girls was thereupon stricken as a party defendant from this lawsuit. No appeal is taken from that order.
We now turn to the relevant facts. Reverend Cowell, a native Kansan, graduated from Kansas State University in 1961 with a degree in agronomy. Thereafter he attended Wheaton School of Theology in Chicago, graduating with the degree of Rachelor of Divinity in 1965. Mrs. Cowell attended both Moody Rible College and Wheaton, but did not complete her work for a degree.
In 1965, the couple returned to Kansas. Reverend Cowell first had a pastorate in Hoisington, then in 1968 he accepted the call to a church in Marion. It was there that he and Mrs. Cowell became interested in helping children. In 1971, Heart Ministries was incorporated as a non-profit corporation. The nature of its business is set forth in its articles of incorporation:
“ ‘[T]o provide housing, facilities, care and detention for wayward, homeless or delinquent individuals ... to preach the Word of God, lead individuals to trust Christ as Savior and Lord, reach out with His love and compassion to those whose lives have been broken and marred by sin, and thus rescue the perishing. As the Lord leads, homes shall be established and scriptural methods shall be used as necessary in order to accomplish this purpose.’ ”
Reverend Cowell became interested in establishing a home for unwed mothers at Marion. Application was made for a state license, but the proposed facility did not conform to standards relative to financing, social services, and fire safety. Extensive and expensive modification to the structure would have been required. After much correspondence, several conferences, and inspection by various state and local officials, plans for the Marion County facility were abandoned. The Marion County land was sold, since licensing did not appear feasible.
Heart Ministries then purchased a tract of 117 acres located about 7 miles east of Hutchinson, in Reno County, in November, 1972. This tract is known as Victory Village. Reverend and Mrs. Cowell moved there, and at first occupied a trailer house; later a parsonage was built, and a large multipurpose metal building, housing a chapel, church offices, a radio studio, and a school, was completed. Construction of a two-story masonry structure, designed as a dormitory for girls and containing between eight and nine thousand square feet, was commenced in the summer of 1973. There were numerous contacts with state authorities as to construction, sanitation, area per resident, and the like, and it appears that the building is being erected in compliance with state standards and regulations. Construction was not complete at the time of trial in November, 1977.
During the period from 1972 to 1977, the defendants operated the Victory Village Home for Girls, and mention of that function or ministry was made by Reverend Cowell on his radio ministry, a program carried by six stations in a number of states. Twenty-one girls were placed in the home at various times by their parents or guardians; they came from Arizona, Arkansas, Colorado, Kansas, Missouri, Oklahoma, and Texas; the girls stayed an average of from nine months to a year. Housing was provided in private homes, some being trailers in the Village and others being homes nearby. Some of the girls stayed with Reverend and Mrs. Cowell; four girls were staying with them shortly before this action was filed. Some of the trailer homes were licensed as foster homes by the owners, but the Cowell home was never licensed. About 1972, Reverend Cowell applied for a “foster home” license so that he could care for four or fewer girls in his own home; he withdrew that application before it was acted upon. No other application for any type of girls’ home was made by the defendants, nor was application made by them to operate a placement agency.
The ministry for girls as carried on by the defendants includes caring for them and providing food and shelter, schooling, counseling, and religious training. A- school is operated at the Village. It uses the Accelerated Christian Education System and is not state accredited, although an expert testified that the system fulfills state requirements. Thirteen girls, in grades one through eight, were attending the school at the time of trial.
In June, 1977, four girls who were living in the Cowell’s home and attending defendants’ school were taken into custody by juvenile authorities on the complaint of an out-of-state acquaintance of one of the girls. Two of the girls were 14 years of age, two 16; two lived in Kansas, one in Nebraska and one in Oklahoma. All were returned to their parents. This action was filed shortly thereafter.
We turn now to the applicable statutes and regulations. The Interstate Compact on the Placement of Children was adopted by the Kansas Legislature in 1976. It appears as K.S.A. 1979 Supp. 38-1202 et seq., and provides in substance that no “sending agency,” which designation includes private persons, may send, bring, or cause to be sent or brought, any child into this state for placement in foster care without the consent of the appropriate public authorities in this state.
K.S.A. 1979 Supp. 65-501 declares it to be unlawful “for any person, firm, corporation or association to conduct or maintain a maternity hospital or home, or a boarding, receiving or detention home for children under sixteen (16) years of age without having a license therefor from the secretary of health and environment.”
K.S.A. 65-502 defines maternity hospital or home.
K.S.A. 1979 Supp. 65-503 defines a boarding home for children in part as a house or other place conducted or maintained by anyone who (1) “advertises or holds himself or herself out as conducting a boarding house or home for children under sixteen (16) years of age”; or (2) “has in his or her control or custody one or more children under sixteen (16) years of age unattended by parent or guardian for the purpose of providing such children with food or lodging, or both, except children related to him or her by blood or marriage, or legal adoption.”
K.S.A. 1979 Supp. 65-504 provides for the issuance of annual licenses for a specified number of residents by the secretary. Both an inspection of the facility by the secretary of health and environment, and the approval of the secretary of social and rehabilitation services, are required before the license may issue. Provisions are included for temporary licensing. Whenever a license is denied or revoked, the secretary of health and environment, the issuing authority, must issue an order stating the reasons for such action. Provision is made for the appeal to the district court of either denial or revocation of a license.
K.S.A. 1979 Supp. 65-505 fixes license fees at $2 for homes having 4 or fewer residents, and at $5 for homes having 5 or more residents.
K.S.A. 1979 Supp. 65-506 prohibits the placing of children under the age of 16 years in any unlicensed maternity home or home for children.
K.S.A. 1979 Supp. 65-507 requires maternity homes and homes for children to keep records of each child received and cared for therein.
K.S.A. 1979 Supp. 65-508 sets forth certain requirements for the physical facilities, and it authorizes the secretary of health and environment, with the cooperation of the secretary of social and rehabilitation services, to develop and adopt rules and regulations for the operation and maintenance of maternity homes and homes for children, designed to promote the health, safety and welfare of the residents. K.S.A. 1979 Supp. 65-512 requires the secretary of health and environment to inspect each facility at least once every six months.
The regulations, as would be expected, are lengthy and quite detailed, and we will make no attempt to summarize all of them here. The various categories of care centers for children are differentiated in the regulations by size: residential centers are those which provide 24-hour a day care for more than 10 children; group boarding homes, for not less than 5 nor more than 10 children; and foster homes, for four or fewer children. K.A.R. 28-4-75, 28-4-250, 28-4-300. The regulations for residential centers and for group boarding homes are almost identical; the regulations for foster homes are much less detailed and less restrictive. Thirteen children were under the care of Heart Ministries at the time this case arose. The dormitory under construction would obviously house and accommodate more than four children. Further, the regulations targeted in the presentation of defendants’ case were those relating to the larger categories. Therefore we are concerned only with the regulations pertaining to residential centers or group boarding homes.
The regulations on licensing procedures require the submission of a written proposal detailing the purpose of the center, the administration, financing, staffing, and services to be offered, and-must include plans for all buildings to be used. The administration section requires that the applicant or its parent body be a nonprofit corporation. The governing board must have at least six members representing a variety of community interests. Finances must be sound and adequate; an annual financial statement must be submitted to the secretary of social and rehabilitation services; and the financial records must be audited annually by a public accountant. Children may not be used in soliciting funds. Liability and casualty insurance is required. Personnel policies must be adopted and records maintained. Training must be provided for staff; minimum qualifications for staff are set forth; health certificates are required; sex offenders or those convicted of felony involving intentional bodily harm may not be employed. Medical and other consultant services must be provided. Records must be kept on each resident and each employee. Discipline which is humiliating, frightening, or physically harmful shall not be used. Corporal punishment, defined as any method of punishment which inflicts pain, is prohibited. Health care, mental health, nutrition, and accident prevention policies are spelled out. Environmental standards cover the physical facilities, construction, location, lighting, heating, food service, water supply, sewage, laundry, and swimming pool safety.
A child placement agency is defined in K.A.R. 28-4-160 as a child or family welfare agency .which receives children for services which may lead to placement in institutions or in foster family homes for boarding care, free care, or adoption. Various regulations governing such an agency follow. Licensing is required.
The activities of the defendants challenged by the State include acting as a child placement agency without a license; acting as a residential center, group boarding home, or foster home, or any of them, without an appropriate State license; and bringing children into Kansas for placement in violation of the Interstate Compact. Defendants, by interrogatories submitted before trial, admitted that they hold no such licenses, and that they have provided board and room for many girls under the age of 16 who were not related to the Cowells. They concluded their answers by stating:
“Defendants do not intend to apply for any license to operate a foster home or a boarding home for children or to abide by any rules or regulations adopted by the Kansas Department of Health and Environment, and the Department of Social and Rehabilitative Services which would make them disobedient to God’s command. The defendants will meet any reasonable regulation that is not against their religious convictions.”
During trial, Reverend Cowell testified that he had no religious objection to reasonable regulations pertaining to health and safety, but he objects on religious grounds to many of the regulations. He believes that corporal punishment is required by scripture; this includes beating children with belts and boards. He objects to the requirement that sound and sufficient finances be disclosed, that an annual financial statement be prepared, and that the accounts be audited, believing that God will provide. He interprets the regulations to require a budget and pledges, which is not consistent with his faith. The requirement of the keeping of records of each child and the disclosure of those records to the State, would be á breach of ethics of his Christian ministry. He objects to the requirement that medical and other professional consultants be arranged for in advance, believing that as the need arises someone can be found to meet that particular need. Finally, he reads the regulations as prohibiting the defendants from attempting to convert to the Christian faith all residents in the Village, a duty which is Biblically imposed upon all Christians.
Reverend Cowell testified that he believes that “everything we do twenty-four hours a day, seven days a week, in the parsonage, in the church, on the grounds, and Victory Village or wherever we go from there, is covered by convictional commandment from God’s Word, the Bible.” Victory Village Home for Girls is one aspect of the total ministry. Other aspects include the church, the school for the girls, counseling the girls as well as others, evangelism, and the radio ministry.
The trial court carefully reviewed the evidence, read the dozens of Biblical and legal citations submitted, and entered its order by way of a lengthy and comprehensive memorandum of decision filed April 21, 1978. The court found that the religious convictions of the Reverend Cowell and those participating in the work of Heart Ministries, Inc. were legitimate, truly held, and consistently practiced, in spite of the fact that any conflict between those beliefs and the state regulations was not asserted by the defendants until after this action was filed. The court found that the State has a genuine interest in the care, treatment and protection of children; and that what is involved is a balancing of the-interest of the defendants in the free exercise of their religion against the governmental interest of the State in the welfare of the children. The court said:
“[T]he Court notes that only since the filing of the Petition herein have the Defendants complained of their resistance to obtaining a license on religious grounds. The Court notes that since 1971 the Defendants have been involved, on different occasions, in the housing of pregnant girls; the placing of the offspring up for adoption; the housing of children under sixteen years of age, both from Kansas and from without; the beating of children; the restriction of childrens’ mail, communication, mode of dress, freedom of religion, and even limiting their education; the placing of children from outside the State of Kansas to foster homes in this State; using children to raise funds for its ministry.
“In all of these incidents mentioned in the last paragraph, the State has a legitimate interest. The requiring of a license for persons who are to operate a foster home, a boarding home, or a residential center for children under sixteen is, in this Court’s opinion, a legitimate exercise of the police power of the State. It is a compelling State interest, and one which is reasonable. The State has a right to determine the purpose of such homes; their administration; their financing, services, and staffing; the safety of children is of paramount interest to the State.”
The court then concluded that the statutes and regulations were constitutional and valid, and the court permanently enjoined the defendants from “operating, maintaining, or holding themselves out to the public as operating or maintaining a maternity hospital, or home, or boarding home as defined by K.S.A. 65-502 and K.S.A. 65-503; or from acting as a placement agency for juveniles under the age of sixteen (16) ... [or from] bringing into or receiving within the State of Kansas children under the age of eighteen (18) for placement in foster homes or foster care within this State . . . until further order of the Court.”
The first question before us is whether the State has an interest in the children’s care, when provided by other than parents, sufficient to warrant control by way of license, inspection, and regulations. In the case of In re Turner, 94 Kan. 115, 145 Pac. 871 (1915), we considered the juvenile court act passed in 1905, L. 1905, ch. 190, later codified as G.S. 1909, 5099-5113. We said:
“[The Act] is an assertion upon the part of the state of its right to exercise its power of parens patriae for the welfare of such of its minor citizens as are deprived of proper parental control and oversight .... These words, meaning ‘Father of his country,’ were applied originally to the king and are used to designate the state, referring to its sovereign power of guardianship over persons under disability.” (p. 120.)
We quoted Mr. Justice Taney’s concurring opinion in Fontain v. Ravenel, 58 U.S. 369, 393, 15 L.Ed. 80 (1854), recognizing that these powers, which belong to the sovereign as parens patriae, are not conferred upon United States Courts, but remain with the State. We also cited Wisconsin Industrial School for Girls v. Clark County, 103 Wis. 651, 79 N.W. 422 (1899), and we quoted the following passage from that opinion:
“ ‘Every statute which is designed to give protection, care, and training to children, as a needed substitute for parental authority and performance of parental duty, is but a recognition of the duty of the state, as the legitimate guardian and protector of children where other guardianship fails. No constitutional right is violated, but one of the most important duties which organized society owes its helpless members is performed just in the measure that the law is framed with wisdom and is carefully administered.’ (p. 665.)” (94 Kan. at 121.)
In re Turner is followed in our later cases. In re McCoy, 184 Kan. 1, 9, 334 P.2d 820 (1959); Lennon v. State, 193 Kan. 685, 691, 396 P.2d 290 (1964); In re Johnson, 214 Kan. 780, 522 P.2d 330 (1974); and see In re Kerns, 225 Kan. 746, 751, 594 P.2d 187 (1979). In Lennon, speaking of the purposes underlying the juvenile code, K.S.A. 38-801 et seq., we said:
“The statute is but a legislative expression of the concern which the people of this state have always had for the welfare of children. This court early gave voice to the public feeling in this regard. Speaking for the court in the case of In re Bullen, 28 Kan. 781, Justice Brewer posed the paramount question:
“ ‘. . . What will be best for the welfare of the child? . . .’ (p. 786.)
“Like a vivid, vital strand, this concept of what is best for the child runs through the tapestry woven from our many decisions dealing with child custody, care and placement.” (193 Kan. at 689-690.)
The statutes and regulations to which the defendants object are all designed to protect, in one way or another, the children who are cared for in homes other than those provided by their parents. The licensing and inspection, as well as the myriad regulations, are concerned with the care and well being of the children — their shelter, health, diet, safety, education, and general welfare are of prime concern.
The parents of the children in the defendants’ facilities are absent and cannot look after them. The children are dependent upon the operators and employees of the home in which they reside for food, care, and shelter. Their welfare is a matter of State concern. Historically the State has protected children from injury and injustice, from harmful employment and environment, and from abuse in all forms. Under the doctrine of parens patriae, the-State has power to legislate for the protection of minor children within its jurisdiction. The rule is stated in 43 C.J.S., Infants § 5, as follows:
“The state has an interest in protecting the welfare of infants, within its borders; and the state, as parens patriae, has the duty to see that every child within its borders receives proper care and treatment. The power of the state to control the activities and conduct of children reaches beyond the scope of its authority over adults.
“The power of state, as parens patriae, is not an unlimited and arbitrary one, and is exercised only in cases where the child is destitute of that parental care and protection to which he is entitled. To effect such power the legislature may and should make reasonable regulations tending toward the protection and welfare of the child; and so important is this governmental function that the limitations of the constitution are to be so construed, if possible, as not to interfere with its legitimate exercise. Such legislation is beneficial and remedial, not criminal in its nature, and entitled to favorable and liberal construction.” (pp. 67-68.)
See also 67A C.J.S., Parent and Child § 15 and 42 Am. Jur. 2d, Infants §§ 14, 15.
Nursing, convalescent, and rest homes, which furnish shelter, food, and care for the sick, aged, or infirm, are all subject to licensing and regulatory acts. This is widely recognized. See Annot., 97 A.L.R.2d 1187. Surely a children’s home is as affected with the public interest as any of those. We hold that the State has a legitimate, vital interest in private establishments which provide residential care for children, and that interest is sufficient to warrant licensing, together with reasonable inspection and regulation.
The next issue is whether K.S.A. 65-501 et seq., requiring the obtaining of a license and the payment of a fee in order to operate a children’s home, as applied to the defendants, violate their rights to the free exercise of religion guaranteed by the First and Fourteenth Amendments of the United States Constitution. The trial court found that the beliefs of the defendants are “truly held,” and that “requiring the Defendants to comply with the rules and regulations . . . [applicable] to boarding homes, maternity homes, and placement agencies, would cause them to depart from their religious convictions.” The State did not cross-appeal; therefore, findings adverse to the State are nonreviewable. Vaughn v. Murray, 214 Kan. 456, 521 P.2d 262 (1974). These nonreviewable findings establish that the defendants’ conduct is religiously grounded; as such it is under the protection of the free exercise clause of the First Amendment. Wisconsin v. Yoder, 406 U.S. 205, 219-220, 32 L.Ed.2d 15, 92 S.Ct. 1526 (1972).
Appellants rely upon the trial court’s finding that the activities and ministries of the defendants, including the operation of the home, are religious in nature and constitute the exercise of religion. They then challenge the licensing and fee requirements as “prior restraints” on the exercise of a constitutionally protected right, the free exercise of their religion as exemplified by their ministry to children in the operation of the home. They cite as controlling Cantwell v. Connecticut, 310 U.S. 296, 84 L.Ed. 1213, 60 S.Ct. 900 (1940) and Kunz v. New York, 340 U.S. 290, 95 L.Ed. 280, 71 S.Ct. 312 (1951).
Cantwell held violative of First Amendment rights a Connecticut statute which made it an offense to solicit funds for religious purposes without a license. The offensive part of the statute, however, was not the mere requirement of a license or permit. What the court found in contravention of the First Amendment was the licensing procedure, which required the secretary of the public welfare council, upon each application for license, to determine whether the cause was a religious one. The court said:
“Without doubt a State may protect its citizens from fraudulent solicitation by requiring a stranger in the community, before permitting him publicly to solicit funds for any purpose, to establish his identity and his authority to act for the cause which he purports to represent. The State is likewise free to regulate the time and manner of solicitation generally, in the interest of public safety, peace, comfort or convenience. But to condition the solicitation of aid for the perpetuation of religious views or systems upon a license, the grant of which rests in the exercise of a determination by state authority as to what is a religious cause, is to lay a forbidden burden upon the exercise of liberty protected by the Constitution.” 310 U.S. at 306-307.
Kunz was concerned with a New York City ordinance which made it unlawful to hold public worship meetings on the streets without first obtaining a permit. There was no mention in the ordinance of reasons for which a permit might be refused, and thus the police commissioner, as the licensing official, could exercise unbridled discretion in denying applications. The court said:
“We have here, then, an ordinance which gives an administrative official discretionary power to control in advance the right of citizens to speak on religious matters on the streets of New York. As such, the ordinance is clearly invalid as a prior restraint on the exercise of First Amendment rights. . . .
“[W]e have consistently condemned licensing systems which vest in an administrative official discretion to grant or withhold a permit upon broad criteria unrelated to proper regulation of public places. . . .
“. . . New York cannot vest restraining control over the right to speak on religious subjects in an administrative official where there are no appropriate standards to guide his action.” 340 U.S. at 293-295.
In support of their argument that the modest fee fixed by statute for an annual license constitutes a per se violation of the free exercise clause, appellants rely upon Murdock v. Pennsylvania, 319 U.S. 105, 87 L.Ed. 1292, 63 S.Ct. 870 (1943). In Murdock, the court struck down a licensing ordinance of the City of Jeannette, Pennsylvania, which, as applied, required Jehovah’s Witnesses to pay substantial fees and obtain a city license before going from door-to-door distributing literature, spreading their faith, and soliciting people to purchase their religious books and pamphlets. The court said:
“The power to impose a license tax on the exercise of these freedoms is indeed as potent as the power of censorship which this Court has repeatedly struck down. . . . [W]e have something very different from a registration system under which those going from house to house are required to give their names, addresses and other marks of identification to the authorities. . . . [T]he issuance of the permit or license is dependent on the payment of a license tax. And the license tax is fixed in amount and unrelated to the scope of the activities of petitioners or to their realized revenues. It is not a nominal fee imposed as a regulatory measure to defray the expenses of policing the activities in question. It is in no way apportioned. It is a flat license tax levied and collected as a condition to the pursuit of activities whose enjoyment is guaranteed by the First Amendment. Accordingly, it restrains in advance those constitutional liberties of press and religion and inevitably tends to suppress their exercise.” 319 U.S. 113-114.
These cases are primarily concerned with the dissemination of ideas, the free speech as well as the free exercise aspects of the First Amendment. They stand for the proposition that inordinate restraints upon the dissemination of religious ideas will not be tolerated. They do not deal primarily with activities secular in nature. Even so, implicit in each opinion is the recognition that some lesser measure of restraint, when necessary for the public good, may be appropriate as to the secular aspects of the activity.
Appellant is equating the operation of homes for children, usually a secular activity, with the dissemination of religious ideas. The teaching of religious doctrine to children simply cannot be equated with every aspect of the physical care of children on an around-the-clock basis for First Amendment purposes. The free exercise clause permits reasonable regulation of otherwise protected religious activity when imposed pursuant to a compelling State interest. Wisconsin v. Yoder, 406 U.S. at 215, held that “only those interests of the highest order and those not otherwise served can overbalance legitimate claims to the free exercise of religion.” Thus when there is a valid State interest, such as its interest in universal education, it is subject to a balancing process when it impinges on free exercise rights.
While religious beliefs cannot be regulated, some overt acts, though in the exercise of one’s religious convictions, are not totally free from legislative restriction. In Sherbert v. Verner, 374 U.S. 398, 10 L.Ed.2d 965, 83 S.Ct 1790 (1963), the court said:
“The door of the Free Exercise Clause stands tightly closed against any governmental regulation of religious beliefs as such, Cantwell v. Connecticut, 310 U.S. 296, 303. Government may neither compel affirmation of a repugnant belief, Torcaso u. Watkins, 367 U.S. 488; nor penalize or discriminate against individuals or groups because they hold religious views abhorrent to the authorities, Fowler v. Rhode Island, 345 U.S. 67; nor employ the taxing power to inhibit the dissemination of particular religious views, Murdock v. Pennsylvania, 319 U.S. 105; Follett v. McCormick, 321 U.S. 573; cf. Grosjean v. American Press Co., 297 U.S. 233. On the other hand, the Court has rejected challenges under the Free Exercise Clause to governmental regulation of certain overt acts prompted by religious beliefs or principles, for ‘even when the action is in accord with one’s religious convictions, [it] is not totally free from legislative restrictions.’ Braunfeld v. Brown, 366 U.S. 599, 603. The conduct or actions so regulated have invariably posed some substantial threat to public safety, peace or order.” (pp. 402-403.)
Governmental interest in conscription laws was held in Gillette v. United States, 401 U.S. 437, 28 L.Ed.2d 168, 91 S.Ct. 828, rehearing denied 402 U.S. 934 (1971), to be of a kind and weight sufficient to justify the impact of the conscription laws on those who object to particular wars on religious bases.
We have previously discussed the interest and the duty of the State as parens patriae in the care of minor children. Some regulation of establishments proposing to provide such care is absolutely necessary; even appellants make no objection to the State’s fire and safety regulations.
But appellants adamantly and unequivocally refuse to apply for any State license, or to pay the required fee. Absent the existence of licensing procedure, applicable to sectarian and nonsectarian establishments alike, the State lacks essential knowledge required for the exercise of its power and duty to protect children from physical and mental harm. Absent licensing, the fire and safety regulations, with which defendants are willing to comply, could not be effectively enforced and their purpose would be compromised.
The fee is minimal; it does not have the repressive force of the charges imposed by the ordinance attacked in Murdock — $5.00 per year for a license to operate a residential center for ten or more children, as compared with the Murdock fee of $1.50 per day, or over $400 per year when paid on a weekly basis, for the sale of religious literature door-to-door by one person. The five-dollar fee does not purport to meet the actual cost of licensing, let alone inspection and consultation. It is not exclusively a revenue-raising measure, but “a nominal fee imposed as a regulatory measure to defray [at least in small part] the expenses of policing the activities in question.” See Murdock, 319 U.S. at 113-114.
The compelling interest of the State, as parens patriae, is the protection of its children from hunger, cold, cruelty, neglect, degradation, and inhumanity in all its forms. To fulfill this responsibility, the legislature has elected to impose licensing and inspection requirements. To these requirements the defendants’ free exercise rights must bow; the balance weighs heavily in favor of those unfortunate children whom the State must protect.
The defendants have no license, and they have not sought one. They state that they do not intend to apply for a license, or to abide by any regulations which they find objectionable on religious grounds. Since we-hold that licensing is necessary and the fee reasonable, and defendants have no intention of becoming licensed, the reasonableness of each and every regulation as balanced against defendants’ religious objections need not be determined.
One further matter deserves attention. Appellants have wholly failed to avail themselves of the administrative remedies open to them by way of the various waiver provisions encompassed within the pertinent administrative regulations. See, for example, K.A.R. 28-4-266(4). It is a familiar doctrine that administrative remedies should be exhausted before resort is made to the courts. See State, ex rel., v. Unified School District, 218 Kan. 47, 542 P.2d 664 (1975); Jarvis v. Kansas Commission on Civil Rights, 215 Kan. 902, 528 P.2d 1232 (1974); Jenkins v. Newman Memorial County Hospital, 212 Kan. 92, 510 P.2d 132 (1973); Holmstrom v. Sullivan, 192 Kan. 746, 391 P.2d 100 (1964). The rule, followed in the great majority of American courts, is stated in 73 C.J.S., Public Administrative Bodies and Procedure § 41:
“Where an administrative remedy is provided by statute, such remedy ordinarily must be exhausted before a litigant may resort to the courts.”
The appellants have not applied for a license; they have no license. As we have held above, a license is a prerequisite to the operation of the various child care facilities and services defendants were operating or performing. The trial court’s grant of injunctive relief was proper.
The judgment is affirmed.
Fromme, J., not participating. | [
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Per Curiam:
This is an action brought by plaintiff-appellant, Defenders of the Christian Faith, Inc., against the defendantsappellees, Sedgwick County Assessor and Board of County Commissioners, seeking injunctive relief pursuant to K.S.A. 60-907(a) from the payment of real estate taxes on certain property and from a pending sale of the real estate for taxes. The district court held in favor of defendants and plaintiff appeals.
The property in question was operated as the Lassen Hotel for many years and was later known as the Radisson Hotel. In August of 1971 the property was purchased by plaintiff and was remodeled for operation as a retirement home known as Defenders Town House. Plaintiff sought to have the property exempted from the payment of real estate taxes. The exemption litigation concluded unfavorably to plaintiff (Defenders of the Christian Faith v. Board of County Commissioners, 219 Kan. 181, 547 P.2d 706 [1976]). Thereafter, the defendant county brought an action to foreclose its tax liens for the 1972, 1973, 1974 and 1975 taxes on the real estate and plaintiff countered with the action now before us. The tax lien action has been held in abeyance pending the outcome of the injunction action. Although owning the real estate in question since 1971, plaintiff has not paid any taxes thereon.
K.S.A. 79-501 provides, in part:
“Each parcel of real property shall be appraised at its fair market value in money, the value thereof to be determined by the assessor from actual view and inspection of the property . . . .”
The action herein is premised on plaintiff’s contentions that the real estate taxes are illegal by virtue of the fact the assessor’s “view and inspection” occurred during open house receptions rather than in a more formal manner upon consultation with plaintiff’s officers, and also the assessor failed to make proper notations on appraisal records.
The district court found and concluded:
“FINDINGS OF FACT
“1. The property in question is legally described as Lots 37, 39,41, 43, 45 and 47 on Market Street in Greiffenstein’s Original Town, now Wichita, Sedgwick County, Kansas, and was purchased by plaintiff on or about August 28, 1971. It was originally known as the Lassen Hotel, later the Radisson Hotel and finally, the Defenders Town House, with a post office address of 155 North Market Street, Wichita, Kansas.
“2. The Sedgwick County Assessor’s record of appraisements and assessments shows the building was erected in 1917. This Assessor’s record was started in 1963 when all real property in Sedgwick County was reappraised over a two (2) year period for appraisal and assessment for the year 1965 by a professional appraisal company, Cole, Layer and Trumble.
“3. T. J. Tucker, a Deputy Assessor in the Sedgwick County Assessor’s Office, identified entries on the record showing that he also appraised the property in 1963, because there was some dissatisfaction with the appraisal of Cole, Layer and Trumble, but that he recommended no change in the appraisal. The record also showed that he had appraised the property on August 15, 1965, and had made no change. The appraisal showed the improvement had a replacement value of $2,735,450, with a depreciated 100% value of $820,640.00 in 1965.
“4. The record shows the appraised and assessed value of the property remained the same for the year 1966. The record shows in 1967 the Assessor lowered the appraised value of the land to $278,100. The 1967 assessment was appealed to the County Board of Equalization, and then to the State Board of Equalization, who lowered the 100% value of the improvement to $547,100.
“5. The record shows that T. J. Tucker made a field appraisal next of the property in 1971. The record shows that he noted June 3, 1971, that no change should be made in the appraised value. No change was made in the assessment for the year 1971. Mr. Tucker retired during the year 1971.
“6. From its construction until September, 1971, the property in question had been a commercial hotel first known as the Lassen Hotel, and then the Radisson Hotel. The building also had peripheral businesses, as it does now. During the year 1971, it was purchased by plaintiff and the name was changed to the Defenders Town House. Plaintiff was forced to replace the boilers and wiring equipment almost immediately at a cost of $500,000. Plaintiff remodeled the interior of the building, utilizing employees from its other resident hotels so that it could be utilized as administrative offices for its operations, computer center, eating space and game room for residents, seminary, chapel, museum and social hall, print shop and mailing room, and so approximately 185 rooms could be used for housing for the elderly. The President, Dr. Hart Armstrong, testified he had never been contacted by the Assessor or anyone from the office about appraisal of the property.
“7. The Sedgwick County Assessor testified he attended the formal opening of the Defenders Town House in 1971, and took a tour of the premises, that he attended the annual open house in subsequent years, and that these visits were for the purpose of appraisal. He was aware of the change in operation of the building and the remodeling and repair. He further testified that he took all of the pertinent statutory factors (K.S.A. 79-503) into consideration in assessing the property for the years 1972, 1973, 1974 and 1975. Plaintiff presented no evidence to the contrary.
“8. In 1972, although he had knowledge of the cost of the new boiler and electrical wiring and other improvements, it was his judgment that the assessed value for that year should be the amount it was in 1971. In 1973, in making the appraisal, it was his judgment that the true value of the land should be lowered from $278,100 to $273,000, and the value of the improvement should remain the same. In 1975, it was his judgment that the fair market value of the property was the same as in 1974.
“9. Sometime after purchasing the property, plaintiff made application to have the property exempted from taxation.
“10. Said application was heard and denied by the Board of Tax Appeals, then the District Court of Sedgwick County, and then the Supreme Court of the State of Kansas ....
“11. Plaintiff paid no real estate taxes pending a final determination of its application on the assumption that such exemption would be granted.
“12. Plaintiff offered no evidence of what factors enumerated in K.S.A. 79-503 were pertinent to valuation or what result would have been obtained had such factors been applied.
“13. The parties stipulated that taxes were unpaid for the years 1972, 1973, 1974 and 1975 ....
“14. The parties further stipulated that plaintiff had not appealed to the County Board of Equalization nor filed an application to the State Board of Tax Appeals to Remedy a Tax Grievance under K.S.A. 79-1702 for any of the years in question.
“CONCLUSIONS OF LAW
“1. Before relief can be granted pursuant to K.S.A. 60-[907](a) the burden of proof is on plaintiff to show that the assessments complained of were illegal in that they were without statutory authority or contrary to statutory authority or were made in such an arbitrary, capricious or oppressive manner as to amount to fraud. Harshberger v. Board of County Commissioners, 201 Kan. 592. The Plaintiff failed to sustain its burden of proof by any evidence.
“2. The ‘actual view’ requirement in K.S.A. 79-411 and K.S.A. 79-[501] is satisfied by the appraiser’s ‘open house’ inspection.
“3. The Sedgwick County Assessor in appraising and assessing plaintiff’s real property for the years 1972, 1973, 1974 and 1975 did so in compliance with his statutory duty and in compliance with the requirements of K.S.A. 79-501, 79-503, and K.S.A. 79-1439, et seq.
“4. The Sedgwick County Assessor in appraising and assessing plaintiff’s real property for the years 1972, 1973, 1974 and 1975 did not act in an illegal, capricious, unreasonable, arbitrary, discriminatory or fraudulent manner.
“5. The assessments made by the Sedgwick County Assessor on plaintiff’s real property for the years 1972, 1973, 1974 and 1975 are valid legal assessments.
“6. The plaintiff, having failed to show that the assessments made on its real property for the years 1972,1973,1974 and 1975 were illegal, is not entitled to any relief and injunction and other relief prayed for is denied, and judgment should be entered in favor of defendant and against the plaintiff for costs.
“It Is Therefore Considered, Ordered, Adjudged and Decreed that the plaintiff is not entitled to any relief and injunction and other relief prayed for by the plaintiff be and the same are hereby denied, and that judgment be and the same is hereby granted in favor of the defendants and against the plaintiff for the costs herein.”
On appeal, plaintiff claims three points of error:
1. The district court erred as a matter of law in concluding the appraiser’s “open house” visits satisfied the “actual view and inspection” requirements of K.S.A. 79-501 and K.S.A. 79-411.
2. The district court erred as a matter of law in holding plaintiff failed to sustain its burden of proof that the assessments of its property made in 1972, 1973, 1974 and 1975 were illegal and in contravention of statutory mandates and in effect a constructive fraud.
3. The district court erred as a matter of law in concluding the actions and assessments of defendant were not illegal and denying plaintiff’s requested relief because these conclusions are not supported by substantial evidence.
Plaintiff does not attack the district court’s findings of fact, but vigorously attacks all of its conclusions of law with the exception of the burden of proof. Plaintiff agrees it has the burden of proof, but contends it sustained its burden.
We conclude that the district court’s findings of fact are supported by substantial competent evidence and that the district court properly applied the law to the facts.
The judgment is affirmed. | [
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The opinion of the court was delivered by
Fromme, J.:
Two separate complaints were filed against J. R. Russell, a licensed attorney, one on April 10 and the other on April 18,1979. The complaints were heard separately by the same panel of the Kansas Board for Discipline of Attorneys. The panel filed a report in both cases with findings and recommendations on August 31 and September 5, 1979, respectively. The respondent filed answers to the panel reports promptly, but delay in setting the cases for argument occurred when the respondent made an attempt to have the United States District Court for the District of Kansas permanently enjoin this court and the Kansas Board for Discipline of Attorneys from hearing the disciplinary proceedings. The respondent’s request for injunction was denied by the federal court. Briefs were then filed by both respondent and disciplinary counsel, and we have proceeded to hear and decide the matters.
The first complaint which will be discussed and evaluated concerns a political advertisement placed in The Kansan, a newspaper of Kansas City, Kansas, in an unsuccessful attempt by J. R. Russell, respondent, to unseat Paul Haas as a member of the Board of Public Utilities. This will be referred to as the Haas complaint.
The second complaint, which will be discussed and evaluated later, concerns the handling of a tort claim by J. R. Russell which claim arose from an automobile collision occurring when a minor daughter of Paul R. Soptick was driving her father’s car. This will be referred to as the Soptick complaint.
I
We will consider the Haas complaint first.
J. R. Russell, a lawyer, ran for public office seeking a position on the Board of Public Utilities (B.P.U.) of Kansas City, Kansas, in the April, 1979, election. The only qualification for the office is being a “qualified voter of the district.” During the campaign J. R. Russell placed a political advertisement in The Kansan on January 21, 1979, which advertisement we will examine in some detail later. It will suffice to say the article was uncomplimentary of both Paul Haas and Nick Tomasic, the district attorney of Wyandotte County.
A similar article had been published by J. R. Russell in a 1976 campaign for the office of district attorney when Russell ran against Nick Tomasic for that position. At that time a complaint was also lodged with the Kansas Board for Discipline of Attorneys (Board) by Nick Tomasic. The complaint was later dismissed for lack of sufficient evidence to prove misconduct. The incident is cited by respondent to indicate bad faith in filing the present complaint because of the similarities in the article published and the previous dismissal. Respondent suggests the present complaint should have been dismissed by the Board.
The panel, after hearing the evidence, found that the respondent prepared the article for publication, placed the same in the newspaper, and knew some of the statements in the article were false, deceptive and misleading. The panel concluded that J. R. Russell had violated the following disciplinary rule:
“DR 1-102 Misconduct.
(A) A lawyer shall not:
“(4) Engage in conduct involving dishonesty, fraud, deceit, or misrepresentation.
“(6) Engage in any other conduct that adversely reflects on his fitness to practice law.” Code of Professional Responsibility, Rule No. 225, 225 Kan. xciii.
The panel recommended that J. R. Russell be disciplined and be publicly censured by this court. The respondent Russell took exception and filed an answer raising certain issues in this court concerning an attorney’s right to freedom of speech under the First Amendment of the United States Constitution and Section 11, Bill of Rights, Constitution of the State of Kansas.
Section 11 of the Kansas Bill of Rights states:
“The liberty of the press shall be inviolate; and all persons may freely speak, write or publish their sentiments on all subjects, being responsible for the abuse of such rights; and in all civil or criminal actions for libel, the truth may be given in evidence to the jury, and if it shall appear that the alleged libelous matter was published for justifiable ends, the accused party shall be acquitted.” Emphasis supplied.
The First Amendment to the United States Constitution merely states that Congress shall make no law abridging the freedom of speech, or of the press, but Section 11 of the Kansas Bill of Rights further explains that all persons may freely speak, write or publish their sentiments on all subjects, “being responsible for the abuse of such rights.” This last phrase recognizes that freedom of speech and press is not without certain limitations. The two constitutional provisions are generally considered coextensive. State v. Motion Picture Entitled “The Bet”, 219 Kan. 64, 72, 547 P.2d 760 (1976).
Freedom of speech and of the press, which are secured against abridgment by these Constitutions, are among the most fundamental personal rights and liberties of the people. New York Times Co. v. Sullivan, 376 U.S. 254, 11 L.Ed.2d 686, 84 S.Ct. 710 (1964). These constitutional provisions do not confer an absolute right to speak or publish without responsibility for whatever one may choose to communicate. Branzburg v. Hayes, 408 U.S. 665, 683, 33 L.Ed.2d 626, 92 S.Ct. 2646 (1972). These provisions in our Constitutions have never prohibited punishment of those who abuse the freedoms guaranteed thereunder. Stromberg v. California, 283 U.S. 359, 369, 75 L.Ed. 1117, 51 S.Ct. 532 (1931). A person’s constitutional right to freedom of speech guaranteed by the Constitutions of the United States and of the State of Kansas is no less by reason of having received a license and privilege to practice law. In re Gorsuch, 76 S.D. 191, 75 N.W.2d 644 (1956), 57 A.L.R.2d 1355 (1958). The principle that the right of freedom of speech is not absolute was expressed most clearly by Justice Oliver Wendell Holmes when he said that no person has a right to cry “fire” in a crowded theatre.
In delineating the boundary between acceptable regulation and impermissible restraint on freedom of expression, the manner and time of regulation will affect the severity of the court’s scrutiny. Restraint of speech and written publication prior to exercise of these rights presents a separate issue from regulation and discipline after the fact. Organization For A Better Austin v. Keefe, 402 U.S. 415, 29 L.Ed.2d 1, 91 S.Ct. 1575 (1971); State v. Motion Picture Entitled “The Bet”, 219 Kan. 64. The cases which concern questions dealing with prior restraint of speech and press are not applicable to our present case. The imposition of the ethical obligation of honesty upon lawyers under DR 1-102(A)(4) and subsequent discipline for violation of the rule is permissible and may be necessary in the interests of the administration of justice. It is only in those instances where unbridled speech amounts to misconduct which threatens a significant state interest, that a state may restrict a lawyer’s exercise of personal rights guaranteed by the Constitutions. Spevack v. Klein, 385 U.S. 511, 17 L.Ed.2d 574, 87 S.Ct. 625 (1967); N.A.A.C.P. v. Button, 371 U.S. 415, 9 L.Ed.2d 405, 83 S.Ct. 328 (1963); Schware v. Board of Bar Examiners, 353 U.S. 232, 1 L.Ed.2d 796, 77 S.Ct. 752, 64 A.L.R.2d 288 (1957); Konigsberg v. State Bar, 353 U.S. 252, 1 L.Ed.2d 810, 77 S.Ct. 772 (1957); In re Sawyer, 360 U.S. 622, 3 L.Ed.2d 1473, 79 S.Ct. 1376 (1959).
When conflict occurs between the regulatory powers of government, as for example the subsequent imposition of discipline for misconduct by a state-licensed attorney, and the individual liberty to speak and publish, a reconciliation must be effected requiring a careful weighing and balancing of the respective interests. Such measures of regulation are not prohibited where justified by a valid governmental interest within the administration of justice, and when the measures are not intended to control the content of speech but only incidentally limit its unfettered exercise.
As to the nature of governmental interest within the administration of justice which justifies such control, it was stated in Polk v. State Bar of Texas, 374 F. Supp. 784 (N.D. Tex. 1974):
“Generally there are two areas where a state has a significant interest in prescribing standards of attorney conduct. An attorney may be disciplined for conduct which shows his inability to represent clients competently and honestly. An attorney may also be disciplined for conduct which interferes with the processes of the administration of justice . . . pp. 787-788.
Respondent notes that little authority can be found on the issue of professional discipline for political rhetoric directly implicating dishonesty under DR 1-102(A)(4). However, extensive treatment is afforded the issues of discipline of attorneys for publications made in the course of political campaigns for the election of judges. See annotations in 57 A.L.R.2d 1362 and 12 A.L.R.3d 1408. An attorney may be disciplined for criticism in the heat of a political contest if such criticism is carried beyond the limits of truth and fairness. In re Charles A. Thatcher, 80 Ohio St. 492, 89 N.E. 39 (1909). Within that context the expression of opinion is protected if true or in good faith believed to be true, but when derogatory factual allegations are false and with ordinary care should have been known to be false, discipline may be imposed. State Board of Exam. v. Spriggs, 61 Wyo. 70, 155 P.2d 285 (1945).
In State v. Nelson, 210 Kan. 637, 640, 504 P.2d 211 (1972), this court stated:
“Concerning respondent’s argument that DR 1-102 (A) (5) creates an impermissible and chilling effect on ‘First Amendment freedoms,’ an examination of decisions on the point (12 A.L.R.3d, Anno., p. 1408) reveals the consensus to be that an attorney’s right to free speech is tempered by his obligation to both the courts and the bar . . . .”
In the case of In re Baker, 218 Kan. 209, 542 P.2d 701 (1975), a disciplinary proceeding arising out of a political campaign against an incumbent judge, this court held that a challenger in a partisan election for judicial office is free to criticize an incumbent’s record so long as the criticism is accurate. However, a violation of ethics was found and the challenger was censured for publishing untrue statements concerning eligibility for a disability pension, which statements the challenger knew or could have known were false by reading an applicable state statute.
Although a lawyer may speak out and state his opinions on current campaign issues without fear of jeopardizing his license to practice law, his First Amendment rights are not absolute. The guarantee of freedom of speech will not protect him from disciplinary action as a lawyer if he is guilty of known falsehood intentionally used and published for the purpose of misleading the voters and gaining personal advantage for himself or his candidate.
It is suggested that because the respondent was not acting in the capacity of an attorney and was not seeking an office requiring the person to have a license to practice law, the Code of Professional Responsibility applicable to lawyers should not apply. We do not agree.
It is recognized generally that lawyers are subject to discipline for improper conduct in connection with business activities, individual or personal activities, and activities as a judicial, governmental or public official. In re Kirtz, 494 S.W.2d 324 (Mo. 1973); In re Wilson, 391 S.W.2d 914 (Mo. 1965); Chernoff’s Case, 344 Pa. 527, 26 A.2d 335 (1942). A lawyer is bound by the Code of Professional Responsibility adopted by rule of this court in every capacity in which the lawyer acts, whether acting as a lawyer or not. Formal Opinion 336, Committee on Ethics and Professional Responsibility of the American Bar Association, June 3, 1974.
Now let us turn to the facts contained in the article published by respondent in The Kansan. The political advertisement appears to be three columns wide and a full page in length. The respondent listed five factual statements in the article charging misconduct, illegal acts and violation of law by the incumbent member of the B.P.U., and by the district attorney of Wyandotte County. Several of these statements contained partial truths which were used to cast aspersions by innuendo on the incumbent member of the B.P.U. and the district attorney.
Although many of the statements do not appear in good taste, they are largely political rhetoric and cannot be the basis for discipline when viewed under the light of the First Amendment. However, there were false statements made which respondent knew or should have known to be false which involved dishonesty and misrepresentation violating DR 1-102 (A) (4). Russell made the statement: “Some ‘unknown’ water & light employees helped their friends embezzle over $600,000.00 from the city water & light dept, over a 3 year period. All parties involved went free and unprosecuted.”
The panel found: “(c) There is no evidence to support Russell’s statement following Fact No. 2 that ‘$600,000.00 was embezzeied from the City Water and Light Department.’ ” There was an audit of the books of the department for that period. The audit report was on file and available to respondent. It reports bookkeeping errors during the period of $335,000.00 and an additional unexplained discrepancy in the books of $200,000.00. The audit disclosed no acts of embezzlement.
The article further stated:
“FACT NO. 5: PAUL HAAS, UTILITY BOARD PRESIDENT, SIGNED AN ILLEGAL $35,000 CONTRACT IN 1975 WITH THE PROTECTION SPRINKLER COMPANY. The execution of the contract was in violation of K.S.A. 75-4317. THERE ARE NO MINUTES OF THIS CONTRACT IN THE UTILITY BOARD’S WEEKLY MEETING MINUTES BOOK. AGAIN, IN VIOLATION OF K.S.A. 75-4317 (Kansas Sunshine Laws).
“RUSSELL’S STATEMENT: THE DIST. ATTY. HAS KNOWLEDGE OF THESE ILLEGAL ACTS SINCE 1975. FOR THE PAST 3 YEARS HE HAS REFUSED TO ACT. INSTEAD HE ACTS AS IF HE WERE THE ‘GUARDIAN ANGEL’ FOR THE UTILITY BOARD INSTEAD OF ATTORNEY FOR THE PEOPLE OF WYANDOTTE COUNTY.”
The panel found:
“(f) In Fact No. 5 of Respondent’s Exhibit 1 and in Russell’s statement following it, Russell states information that is not substantiated by evidence and is totally untrue. He cites Kansas statutes which are irrelevant and not applicable to the facts stated and then alleges that the law was violated when it was not.”
The basis for the panel’s findings was testimony that investigation of allegations of such an illegal contract had been made. The Kansas Bureau of Investigation, the offices of the attorney general and of the district attorney had investigated the matter. The possible purchase of a sprinkler system had been informally considered in connection with insurance coverage. The purchase was ultimately abandoned as being unnecessary. The insurance was obtained without installing the sprinkler system. The investigation revealed that no contract of purchase was in existence. The seller of the system had merely submitted a proposal to the board. The proposal was never approved or accepted. The investigations resulted in the conclusion that there was no evidence that any crime was committed. This was generally brought to light in the community and the respondent knew or should have known his charges in connection therewith were false.
After having examined the statements made by the respondent in an effort to delineate the boundary between acceptable regulation and impermissible restraint on freedom of expression, we hold that first amendment rights in this case cannot protect the respondent from disciplinary action. He was guilty of intentionally publishing known falsehoods which were used for the purpose of attempting to gain personal advantage by misleading the public. In so doing he engaged in conduct involving dishonesty and misrepresentation which raises questions as to his ability to represent clients honestly. This is an area where the State does have a significant interest in prescribing and enforcing standards of attorney conduct.
J. R. Russell is hereby publicly censured for violation of DR 1-102(A)(4). 225 Kan. xciii.
II
We now turn to the Soptick complaint. The complaint concerns the representation by J. R. Russell of complainant, Paul R. Sop-tick, on a personal injury and property damage claim arising from a car accident. A minor daughter of the complainant was driving the family car when she was struck from behind by a vehicle owned and driven by Edward Willis. Willis was not insured. J. R. Russell was retained by Soptick on April 19,1978. Soptick signed a contract for employment with Russell which provided for a 50% contingent fee, and in addition Soptick paid Russell $300.00 for a retainer plus $43.00 court costs. A petition was filed in court April 26, 1978, but summons was returned without service. Willis could not be located. Frequent and numerous attempts by Sop- tick thereafter to contact Russell were unsuccessful. Russell’s secretary was instructed by Soptick to have Russell call when he was available. He failed to do so. As late as August 14, no service of summons had been obtained on Willis. Soptick met Russell on the street and arranged for a meeting in Russell’s office for September 13, but Russell did not make it to the meeting. Soptick then left a request to call him but again received no response. The case had languished in the court without summons being served for five months. Soptick sent a complaint to the disciplinary administrator. Russell notified Soptick on September 22 he was withdrawing from employment. Soptick’s complaint against Russell then was dismissed on December 6, 1978. Soptick understood the $300.00 retainer was to be refunded and notified Russell to that effect. Soptick attempted twice to contact Russell but was unsuccessful. Soptick then renewed his complaint against Russell with the disciplinary administrator. A formal complaint was again issued against Russell and two days later Russell refunded the retainer fee and filed a motion in the court to withdraw as attorney for the Sopticks.
The panel found that respondent, after filing the petition, took no further action to pursue Soptick’s claim. Russell kept no time records, recorded no contacts with the Sopticks, and introduced no evidence as to the amount of fee, if any, earned by him. The panel concluded there were several violations of the disciplinary rules governing the attorney-client relationship. The first was DR 2-110 relating to withdrawal from employment which requires the attorney to obtain permission for withdrawal from the court in which a case is pending before terminating the client-attorney relationship. The attorney is required to deliver all papers to the client and refund any part of an advance fee which has not been earned. The panel found the respondent failed to comply with this rule until he was under the compulsion of the second disciplinary proceeding.
The panel further found a violation of DR 6-101(A)(2) and (3), in failing to act competently, in attempting to handle a legal matter without adequate preparation and in neglecting a legal matter entrusted to him. The panel found a violation of DR 7-101 in failing to carry out the contract of employment entered into with the client. The panel further found that the respondent violated DR 7-102(A)(2) in knowingly making a false statement of fact in the petition filed on behalf of the daughter of Paul R. Soptick by stating she had incurred over $500.00 in medical services and had met the threshold requirements of the so-called “no-fault” insurance law, K.S.A. 1979 Supp. 40-3117.
We turn now to the arguments of respondent. He first contends that when the complaint was referred to the disciplinary administrator, investigated by the Kansas Board for Discipline of Attorneys and dismissed for insufficient evidence, this resulted and had the same effect as a dismissal of a court case on the merits. He argues dismissal was with prejudice against filing the second complaint on the same matter. Respondent equates our procedure in disciplinary hearings with the rules of civil procedure, specifically K.S.A. 60-241(a). This statute is not helpful to respondent for the statute provides: “Unless otherwise stated in the notice of dismissal or stipulation, the dismissal is without prejudice.” It should be noted, however, the only application of the Code of Civil Procedure in disciplinary hearings appears under Rule 211, Rules of the Supreme Court, 225 Kan. Ixxxvi, where the rules of evidence are made applicable to hearings before the panel, nothing more.
Both parties cite the case of State Bar v. Woll, 401 Mich. 155, 257 N.W.2d 650 (1977), which holds the Michigan State Bar Grievance Board and its hearing panel has the authority to dismiss a complaint against an attorney with or without prejudice. Authority for this appears in the Rules of the Michigan State Bar, rules 16,16.11 and GCR1963,504.1 (2). The Michigan holding is logical and practical.
In the present case the letter of dismissal merely notified respondent that the state board had directed the disciplinary administrator to dismiss the complaint. Nothing was said about prejudice. The initial investigation provided for in Rule 210, Rules of the Supreme Court, for discipline of attorneys, is for the purpose of determining “probable cause to believe there has been a violation of the Code of Professional Responsibility” which may require formal discipline. The nature of the investigative portion of the proceedings, before formal hearings begin, are more in the nature of a preliminary hearing, the dismissal of which should not have the force of res judicata. Bernard v. State, 261 So. 2d 133 (Fla. 1972); Annot., 49 A.L.R.3d 1039. Jeopardy attaches in a nonjury trial when the trial begins, not before. Cox v. State, 205 Kan. 867, 473 P.2d 106 (1970).
Accordingly we hold a review committee of the Kansas Board for Discipline of Attorneys has the authority to dismiss a complaint against an attorney with or without prejudice under Rule 210, Rules of the Supreme Court; and when dismissal is ordered without specifying the nature of the dismissal the dismissal is without prejudice to the filing of later proceedings on the same matter.
Although disciplinary proceedings against attorneys are neither civil or criminal (State v. Holmes, 218 Kan. 531, 545 P.2d 343 [1976]) such proceedings have frequently been characterized as quasi-criminal in nature for purposes of considering the application of procedural safeguards. In re Ruffalo, 390 U.S. 544, 20 L.Ed.2d 117, 88 S.Ct. 1222, reh. denied 391 U.S. 961, 20 L.Ed.2d 874, 88 S.Ct. 1833 (1968). The sanctions threatened under such proceedings, loss of professional status and livelihood, have been equated to criminal penalties for the purposes of deciding whether the clause against self-incrimination of the Fifth Amendment applied in such proceedings. Spevack v. Klein, 385 U.S. 511.
A complaint which was previously dismissed without prejudice after an investigation under Rule 210, Rules of the Supreme Court, is not barred under theories of res judicata or double jeopardy from a hearing if it appears additional facts may be developed which were not available or known during the initial investigation. Here a promise was made to withdraw from the case and to refund the retainer fee. That promise was not kept until after the second formal complaint was served. Neither res judicata nor double jeopardy precluded action under the second complaint.
The final issue raised by respondent concerns alleged violations of certain rules of conduct under the Code of Professional Responsibility which respondent claims were not properly disclosed to him by the formal complaint. After examining each of these matters raised by respondent we believe they were sufficiently encompassed within thé Soptick complaint as to meet due process requirements in the filing of a disciplinary complaint. The formal complaint did provide the respondent adequate notice of the alleged misconduct for him to properly defend the action. See In re Ruffalo, 390 U.S. 544; State v. Berkley, 214 Kan. 571, 520 P.2d 1255 (1974); State v. Turner, 217 Kan. 574, 538 P.2d 966 (1975).
However, the hearing panel found a violation of DR 7-102(A)(1) and (2) in that he “[kjnowingly made a false statement” in the petition he filed with the court involving the Soptick tort action. The panel found the petition in tlje action erroneously stated the threshold requirement for medical expenses of $500.00 was met under the Kansas Automobile Injury Reparations Act as required in K.S.A. 1979 Supp. 40-3117(fe). The threshold must be met to permit a person to recover for pain, suffering, mental anguish and inconvenience. The petition in the case was never heard by the court. It has been held that this monetary threshold requirement of the statute may be met not later than the date of trial or the date the cause of action is barred by the statute of limitations, whichever first occurs. Key v. Clegg, 4 Kan. App. 267, Syl. ¶ 5, 604 P.2d 1212, rev. denied March 7, 1980. Time for proving the monetary threshold requirement had not yet arrived and although the statement in the petition may have been technically incorrect at the time the petition was drawn, it can hardly be said respondent intentionally meant to mislead the parties or the court thereby. No discipline can be based thereon.
After examining the various contentions of the respondent we find he did neglect a matter entrusted to him and did not act promptly in keeping his promise to withdraw from the case and refund the retainer fee. J. R. Russell is hereby publicly censured for violation of DR 2-110(A)(1) and (3), DR 6-101(A)(2), and DR 7-101(A)(l). | [
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The opinion of the court was delivered by
Herd, J.:
This is an appeal from an order granting Leland C. Waechter and approximately 500 other named landowner-lessors, representing a class of 3,000 landowners-lessors in the Hugoton gas field, an accounting for interest on suspended royalty payments for gas sold during the period June 23, 1961, to June 23, 1966. This controversy is yet another episode in litigation which began in 1964 with the filing of this action. A history of the case is found in Waechter v. Amoco Production Co., 217 Kan. 489, 537 P.2d 228 (1975), and reheard in 219 Kan. 41, 546 P.2d 1320 (1976). Appellants argue the claim is res judicata. The previous appeal will be discussed herein with its significance to this case.
In Waechter v. Amoco Production Co., 217 Kan. 489, Waechter and the class sued Amoco requesting an accounting for gas produced during the period from June 23, 1961, to June 23, 1966, on the basis of 14.5 cents per Mcf at 14.65 psia instead of the lower prices actually paid to Amoco by the purchasers of the gas. The other claim was to determine whether Amoco was entitled to be repaid for over-payments of royalty it made to the landowners.
The trial court held for plaintiff on both issues. Amoco appealed. The lease between Amoco and plaintiffs provides:
“Lessee shall pay lessor monthly as royalty on gas marketed from each well one-eighth (Vs) of the proceeds if sold at the well, or, if marketed by lessee off the leased premises, th m one-eighth (Va) of the market value thereof at the well.” Waechter at 490.
The trial court made extensive findings of fact and conclusions of law which are reproduced in their entirety at 217 Kan. 491-508. We reproduce Finding of Fact No. 39 to show what facts were before the trial court and this court on the previous appeal:
“39. As a result of such FPC approval, Pan American has paid to any or all of its royalty owners under said contract (provided such payment will not prejudice its rights under this action) for gas it had produced during the time between December 13, 1962, and April 31, 1966, the difference between the price of 12 cents per Mcf at 16.4 psia and 12.5 cents per Mcf at 14.65 psia, and since April 13, 1966, have continued to pay royalties at the rate of 12.5 cents per Mcf at 14.65 psia.” Waechter at 498-499.
The first issue in that case was:
“Did the Defendant [Amoco] have on or subsequent to February 15, 1963, a legally enforceable claim against the landowners for a refund of royalties paid by Defendant [Amoco] by reason of the production of gas prior to December 22, 1957?” Waechter at 505.
. The trial court held the payments were properly made and ordered Amoco to:
“account to the named Plaintiffs and class members from whom such purported refunds were received or retained for the account thereof together with interest on the amount of each of said payments or retentions from the date any such sum was received or retained to the date repayment to Plaintiffs and class members is finally made, with interest to be computed at the legal rate from time to time.” Waechter at 506.
The second issue in that case was stated as follows:
“30. Is the lessee-producer obligated to account to the landowners for royalties computed on the basis of not less than 14.5 cents per Mcf at 14.65 psia for gas produced, delivered and transported in interstate commerce and sold to Cities Service Gas Company during the period from June 23, 1961, through June 23, 1966?” Waechter at 507.
The trial court held:
“37. It is therefore ordered that the Defendant account to each of the named plaintiffs and class members for gas taken on the basis of 14.5 cents per Mcf at 14.65 psia for the period of time commencing June 23, 1961, through June 22, 1966, with interest at the legal rate prevailing from time to time on the difference between the amount owed (according to this judgment) and the amount paid.” Waechter at 508.
This court reversed the trial court on both issues and stated, with regard to the second issue:
“Appellees have been paid their share of those proceeds and the trial court erred in holding appellant liable for more.” Waechter at 512.
The court continued at page 521:
“Appellant has not retained any money to which it was not morally entitled under all the circumstances. The trial court erred in ruling that appellant was accountable for the royalties retained by it.”
A rehearing was granted and the original opinion of reversal was adhered to. Waechter v. Amoco Production Co., 219 Kan. 41, 546 P.2d 1320 (1976).
The parties are again before this court, this time solely on the question of interest on suspended royalties by Amoco from June 23,1961, to June 23,1966. The question presented: Is res judicata a bar to Waechter’s claim?
Appellees contend they filed three motions for partial summary judgment in the original proceeding. The first motion was filed October 31, 1966, and pertains to Issue Two; the second motion was filed January 4, 1967, and pertains to Issue One. The third motion for partial summary judgment was filed March 3, 1967, and states:
“COME NOW the plaintiffs and, pursuant to K.S.A. 60-256(a) and 60-257, move the Court for partial summary judgments, as follows:
“A. For an adjudication of right pursuant to K.S.A. 60-1701 with respect to gas delivered under the contract of June 23,1950, that, under the undisputed facts in this case, defendant is obligated to account to the named plaintiffs for monthly royalties withheld by defendant and accruing by reason of production from and after December 13,1962, through and including June 22,1966, on the basis of at least 12.5 cents per Mcf at 14.65 p.s.i.a.
“B. For an adjudication of right that the defendant is obligated to pay interest on royalties so computed at the rate of six (6) per cent per annum, all such computations of interest to be computed on the difference between the royalties previously paid and that which would have been paid had such royalties been computed on the basis of 12.5 cents per Mcf at 14.65 p.s.i.a., such interest in each case to be computed from the time when said monthly payment is finally actually made.
“C. For ancillary relief implementing A and B above, consisting of an order directing the defendant as to all named plaintiffs who have not been paid royalty on the basis set forth in A, together with interest as to all named plaintiffs as set forth in B, to pay all such sums into Court subject to the further order of the Court.
“In support of this motion, plaintiffs show to the Court that there are approximately 200 named plaintiffs permitted to become parties to this suit by order of this Court after September 3, 1966, who have not been accounted to on such minimum basis, although defendant has accounted to other named plaintiffs on such basis, without prejudice to their remaining claims. In support of paragraph b of the motion, plaintiffs show to the Court that it is undisputed that no accounting has been made by defendant for interest to any plaintiff. That interest is due and owing is established by the following authorities: K.S.A. 60-201; Smith Bros. v. Hanson, 106 Kan. 32, 187 P.2d 262; Potts v. Lux, 168 Kan. 387, 214 P.2d 277; Northern Natural Gas Co. v. Republic Natural Gas Co., 172 Kan. 450, 241 P.2d 708; Kansas Power & Light Co. v. Hugoton Production Co., 251 F.2d 946 (10th Cir.).”
None of the three motions were directly ruled on, except as reflected in the findings of fact and conclusions of law. Appellees contend the first and second motions were sustained and no action was taken on the third motion. The renewal of the third motion is the basis for the instant action. Appellees state the trial court “granted [them] judgment on their additional claim that [they] were entitled to payment from [Amoco] on the basis of the market value of the natural gas, found to be 14Yz cents per Mcf at 14,65 psia.” Appellees urge that trial court finding number 37, reproduced herein, shows that the “interest” the trial court referred to was an award of prejudgment interest on appellees’ market value claims. They claim that award precluded the trial court from considering appellees’ market value claims and also precluded the trial court from considering appellees’ additional claims for interest on the suspended royalties.
Appellant argues that appellees requested interest on suspended royalties in their March 3, 1967, motion for partial summary judgment (which we have designated the third motion) and the issue was disposed of in the trial court’s conclusion No. 37. Appellant further contends it presented the issue of interest on suspended royalty in its brief in the original case where it stated:
“Here, there was an honest disagreement existing between the parties arising out of the appellees’ separate claims, the alleged damages were unliquidated, and moreover, the record supports the appellant’s position that royalty owners were timely and properly paid, foreclosing any right of the plaintiffs to prejudgment interest.”
Appellant further claims the interest allowed by the trial court encompassed and included the interest sought by appellees in their motion for summary judgment on suspended royalty.
Appellant argues that as further evidence this court had before it the issue of interest on suspended royalties in the decision in the previous appeal, it submitted points 14 and 15 in its Original Statement of Points upon which Appellant Intends to Rely:
“14. It was error to order the defendant to account to named plaintiffs and class members for gas taken on the basis of 14.5 cents per Mcf at 14.65 psia for the period June 23, 1961 through June 22, 1966, with interest on the difference between the amount owed (according to judgment) and the amount paid.
“15. It was error to ignore evidence that such price was not received or retained by defendant for said period; that only 10.7195 cents per Mcf at 14.65 psia from June 23,1961 to December 13,1962 and 12.5 cents per Mcf at 14.65 psia was the actual price received only from December 13, 1962 through June 22,1966 and that increases in price were not paid promptly by Cities Service; that defendant’s royalty owners for all periods involved have been paid the exact same prices that defendant has been paid.”
Appellánt argues in the alternative that if the trial court failed to rule on the third motion for partial summary judgment pertaining to interest on suspended royalty, appellees were bound to cross-appeal from the judgment for the omission because the issue was clearly before the court and appellees are thereby bound by the judgment of the trial court. Appellees’ response to that argument is that the court could not have granted the request for interest at that time as it would have been granting double interest on the same principal.
The issues are clearly presented. Was the question of interest on suspended royalty before this court in the previous appeal? If it was, is the issue res judicata in this action?
We find the question of interest on suspended royalty was clearly and firmly presented in the trial court in the previous action. We find the trial court clearly and succinctly ruled on the issue in its Conclusion No. 37, previously quoted, ordering “interest at the legal rate prevailing from time to time on the difference between the amount owed . . . and the amount paid.” That language plainly shows the trial court ruled the royalty owners were entitled to interest at the legal rate on all suspended royalties. That issue was brought before this court in the original appeal and was considered and reversed. The issue is one which has been previously litigated and ruled upon.
We have dealt extensively with the law of res judicata and collateral estoppel in several recent cases.
In Seute v. American Oil Co., 225 Kan. 640, 594 P.2d 156 (1979), the court stated at 642:
“We held in Taber v. Taber, 213 Kan. 453-454, 516 P.2d 987 (1973):
‘The doctrine of res judicata is plain and intelligible, and amounts simply to this — that a cause of action once finally determined, without appeal, between the parties, on the merits, by a competent tribunal cannot afterwards be litigated by a new proceeding, either before the same or any other tribunal.’ ”
In Wells v. Davis, 226 Kan. 586, 603 P.2d 180 (1979), we stated at 589:
“In Hutchinson Nat'l Bank & Trust Co. v. English, 209 Kan. 127, 130, 495 P.2d 1011 (1972), we stated:
‘The salutary rule of res judicata forbids a suitor to twice litigate a claim for relief against the same party. The rule is binding, not only as to every question actually presented, considered and decided but also to every question which might have been presented and decided. [Citations omitted.] In Kansas the rule of res judicata is not binding and does not apply to a different claim for relief even though it may be between the same parties. [Citations omitted.] However, when a different claim for relief is filed between the same parties a collateral estoppel may be invoked as to questions and issues shown to have been actually decided in the prior action. [Citations omitted.]’ ”
We hold in this case res judicata is a bar to recovery. The parties to the action are the same as in the previous claim and the issue of suspended royalties and interest thereon was clearly before the court and was decided.
The judgment of the trial court is reversed. | [
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The opinion of the court was delivered by
Fromme, J.:
This appeal is from an order disallowing a claim against the estate of a deceased husband for support of his wife during a period of separation which preceded the husband’s death.
The facts leading to the claim are not in dispute. Ida C. and Lloyd W. Davis were married at Belleville, Kansas, on August 31, 1904. They accumulated real and personal property during the course of their marriage. Five children were born to the marriage — Ruth Nelson, Leona Van Vleet, Lloyd Wesley Davis, James Davis and Lauren Davis. The marriage went well between Ida and Lloyd until 1966. Their difficulties can be traced to a controversy among the children over the property accumulated by the parents.
Lloyd, being of an advanced age, made substantial gifts of real estate and money to three of the children, Ruth, Lloyd Wesley and Leona. Then Ida deeded some of her real estate to Ruth, but Ida regained the property in 1968 by filing a suit. Ida also filed an action against her husband, Lloyd, at this same time asking for separate maintenance. Lloyd cross-petitioned for a divorce. Ida was 86 years of age and her husband was 88. The trial court denied the petition for separate maintenance but ordered a division of the remaining property owned by the parties. The cross-petition for divorce was never ruled on. In dividing the property the court stated:
“Instead of these old people being allowed to enjoy their declining years in a normal manner or to reap the benefits of their estate acquired through years of hard work, they have been subjected to constant turmoil, worry, anguish and heartbreak due to the controversy and bickering of their children.”
In ordering a division of the property owned by these two old people, the court assigned the following to Lloyd:
“(a) His bank account in the Swedish-American State Bank of Courtland, Kansas; [$120 to $125]
“(b) An Undivided One-Half (Vz) interest in the East Half (E%) of the Northwest Quarter (NWVi), 25-3-5, Republic County, Kansas;
“(c) Defendant’s life estate in the Southeast Quarter (SE!4) 3-34-31, Republic County, Kansas;
“(d) One-Half (Vz) interest, or the sum of $7,500.00, of the last $15,000.00 withdrawn from the Capitol Federal Savings and Loan Association of Topeka, Kansas, later deposited in the bank at Hastings, Nebraska, and, thereafter, transferred to defendants Leona Van Vleet and Ruth I. Nelson. The defendants last named are ordered to transfer this amount to defendant, Lloyd William Davis, and judgment is given said Lloyd William Davis against said defendants for this amount.”
The following property was set over to Ida:
“(a) Household goods;
“(b) Antiques at the farm home;
“(c) Account in the Scandia Bank; [$300]
“(d) The 3 Certificates of Deposit in the People’s National Bank, Belleville, Kansas; [$12,600]
“(e) Account No. 3802D in the North Kansas Savings and Loan Association, Beloit, Kansas; [$15,027.82]
“(f) The home in Scandia, Kansas;
“(g) The 40 Acres of land in Plaintiff’s name;
“(h) Plaintiff’s life estate in the Southeast Quarter (SEVi) 3-34-31, Republic County, Kansas;
“(i) The Hill Lots in Scandia, Kansas;
“(j) An Undivided One-Half (Vi) Interest in the East Half (EVi) of the Northwest Quarter (NWV4), 25-3-5, Republic County, Kansas;
“(k) One-Half (Vi) interest, or the sum of $7,500.00, of the last $15,000.00 withdrawn from the Capitol Federal Savings and Loan Association of Topeka, Kansas, later deposited in the bank at Hastings, Nebraska, and, thereafter, transferred to defendants Leona Van Vleet and Ruth I. Nelson. The defendants last named are ordered to transfer this amount to plaintiff, and judgment is given plaintiff against said defendants for this amount.”
As is apparent from the difference in the amounts of the above divisions of property, Ida received the greater amount and value. The court, in ordering the division of property, found that after this division Lloyd was without sufficient income to support his wife. Lloyd had the income from 80 acres of farm land, accruing interest on $7,500.00 withdrawn from Capitol Federal Savings and Loan Association, and a social security pension of $54.00 per month.
Ida was in failing hedlth and was living in the Republic County extended care home. The court, in ordering the division of property, found that Ida had some income from the property set over to her, interest income from the savings accounts and certificates of deposit, and $27.70 a month coming to her from social security. The court acknowledged that this income would not be sufficient to cover her needs, but stated she could invade the principal of her savings, which would then be adequate. The order dividing the property was signed in October, 1969. Ida continued to live separate and apart from Lloyd until her death.
Ida died testate in January, 1975. Her will was admitted to probate. Under the will Lauren and James were named as sole devisees and legatees. Her husband, Lloyd, who was then 94 years old, elected to take under the laws of intestate succession, and received half the property remaining after payment of expenses and attorney fees. Apparently Ruth, Leona and Lloyd Wesley received nothing from the mother’s estate. They had received practically all the gifts of property transferred by Lloyd in 1966 totaling over $175,000.00.
Lloyd died testate in March, 1976. Under Lloyd’s will Lauren, James and Lloyd Wesley were bequeathed $100.00 each. The remainder of his estate, including the property coming from the estate of Ida, was devised and bequeathed equally to his daughters, Ruth and Leona.
James, the executor of the estate of Ida, filed a claim against Ruth, the executrix of the estate of Lloyd, for the sum of $24,966.81 which sum consisted of those amounts expended for the support of Ida from her own funds, after the property division and prior to her death, while she was living separate and apart from her husband. The claim was denied in the district court and the executor of Ida’s estate appeals to this court.
The threshold question to be decided is: Can a district court in an action for separate maintenance deny the petition for separate maintenance but enter a valid and binding order dividing the property between the parties?
The answer to this question is yes, and lies in K.S.A. 60-1606 which reads in pertinent part as follows:
“If a decree of divorce, separate maintenance or annulment is denied other than for the equal fault of the parties the court may nevertheless make any of the orders authorized by this section for the benefit of the minor children of the parties or for the equitable division of the property of the parties.” Emphasis supplied.
This statute clearly authorizes a court to make an equitable division of the property owned by the parties if a decree of divorce, separate maintenance or annulment is denied, other than for the equal fault of the parties. In our present case the court denied any such decree. The denial was not based upon equal fault of the parties, and the court had jurisdiction to decree an equitable division of the property.
In a domestic relations case a division of the property of the parties, when called for by the circumstances, rests in the sound discretion of the trial court. Clugston v. Clugston, 197 Kan. 180, 182, 415 P.2d 226 (1966). Such division of the property must be made in a just and reasonable manner. St. Clair v. St. Clair, 211 Kan. 468, 498-499, 507 P.2d 206 (1973).
It should be pointed out that since the court did have jurisdiction to divide the property and no appeal was taken from the decree it cannot be collaterally attacked in a later proceeding. Jayhawk Equipment Co. v. Mentzer, 191 Kan. 57, Syl. ¶ 2, 379 P.2d 342 (1963).
We turn next to the ultimate question raised in this appeal. Can the wife’s executor recover from the estate of the husband for alimony or support not previously decreed but claimed for a period of separation of the parties which preceded the husband’s death?
K.S.A. 1979 Supp. 60-1610(d) relating to alimony and support states:
“The decree may award to either party an allowance for future support denominated as alimony, in such amount as the court shall find to be fair, just and equitable under all of the circumstances. The decree may make the future payments conditional or terminable under circumstances prescribed therein. The allowance may be in a lump sum or in periodic payments or on a percentage of earnings or on any other basis. At any time, on a hearing with reasonable notice to the party affected, the court may modify the amounts or other conditions for the payment of any portion of the alimony originally awarded that have not already become due, but no modification shall be made, without the consent of the party liable for the alimony, if it has the effect of increasing or accelerating the liability for the unpaid alimony beyond what was prescribed in the original decree.” Emphasis supplied.
It is apparent that these provisions of the statute originally adopted in 1963 made some sharp changes from the prior statutes. See G.S. 1949, 60-1516. Prior statutes provided for alimony and support of the wife by the husband. Our present law authorizes a decree awarding either party an allowance for future support. In Herzmark v. Herzmark, 199 Kan. 48, 53, 427 P.2d 465 (1967), it is stressed that the allowance authorized is for support in the future. It may be awarded to a party irrespective of fault. Zeller v. Zeller, 195 Kan. 452, Syl. ¶ 6, 407 P.2d 478 (1965). The provisions for maintenance and support in the statute are to be invoked when one party’s needs and the other party’s ability to pay are such that support should be ordered. Moran v. Moran, 196 Kan. 380, Syl. ¶ 4, 411 P.2d 677 (1966). In Herzmark v. Herzmark, 199 Kan. at 55, it is pointed out that an allowance for support is based on need and upon proof of remarriage a prima facie case for termination of future support payments has been established. In the present case the wife was dead when the claim was filed. This claim could hardly be supported based on need. It was not for future support.
The trial court in its decree denying separate maintenance divided the property between the parties and made the following observations:
“It is quite apparent neither the husband or wife are physically able to care for themselves or anyone else. In addition to their physical condition, they have suffered mental deterioration normal or above normal for persons of their advanced ages.
“It is quite obvious this elderly couple are incapable of caring for or supporting themselves. Fortunately, however, their future maintenance is secure. It appears plaintiff has sufficient funds to last during her lifetime. Defendant Lloyd William Davis’ future is secure by virtue of limited funds and the assurance, under oath, of his son, defendant Lloyd Wesley ‘Jack’ Davis, to care for his father. The welfare of these old people is, of course, the paramount consideration of the Court.”
A case with facts somewhat similar to our present case was In re Estate of Crawford, 155 Kan. 388, 393, 125 P.2d 354 (1942), where the wife filed a claim against the husband’s estate for expenditures she claimed her husband “was legally obligated to make for her support.” The Crawford court merely observes in closing: “We think that no cause of action was stated and that the demurrer was properly sustained.”
In our more recent case of In re Estate of Sweeney, 210 Kan. 216, Syl. ¶ 1, 500 P.2d 56 (1972), we point out that periodic payments for support to a divorced wife terminate and end on death in absence of a provision in the settlement agreement, or in the decree, which expressly provides for payments after the former husband’s death.
In the present case no decree for support or alimony was sought after the division of property was ordered until the death of the husband. Until such a decree is entered no enforceable liability exists and no amount has been determined necessary. The duty to support continues only during the existence of the marriage relationship. When the husband dies the marriage relationship terminates, and the obligation for support cannot be enforced against the husband’s estate. Such obligation is personal between the parties to the marriage and does not survive. Alimony is support money based on need and ability to pay. The foundation for an award of alimony is a spouse’s duty to support the other spouse, a duty that ends with death and which cannot then be the basis for an award from the estate of the deceased spouse.
We hold that when a division of property is decreed in a separate maintenance action and no provision for support or alimony is sought until after the death of the parties, a claim for support brought by a personal representative cannot be maintained.
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The opinion of the court was delivered by
Herd, J.:
This is an action seeking a declaratory judgment and permanent injunction from the enforcement of 1979 amendments to the Kansas Liquor Control Act (K.SA. 41-101 et seq). The amendments were enacted by the legislature, effective May 10, 1979 and are designated House Bill 2020. The trial court found the act constitutional but found certain sections of the amendments in violation of the Sherman Anti-Trust Act. 15 U.S.C. § 1 et seq. We hold H.B. 2020 constitutional, thus reversing in part and affirming in part the judgment of the trial court.
A brief discussion of the history of Kansas liquor laws will be helpful in understanding the issues before us. In 1880, Kansas amended its constitution providing for prohibition. Kan. Const, art. 15, § 10. Bootleggers and illegal saloons flourished, however, until Carry Nation and others aroused public indignation by their attacks on illegal liquor traffic at the turn of the century. Feelings of both anti-saloon and pro-saloon forces became increasingly violent until finally, urged on by the fear of armed conflict, the legislature passed laws making it a penal offense for one to give another a drink of alcoholic liquor, to be found in a place where it was sold, to sell it and finally to possess alcoholic liquor. L. 1881, ch. 128, §§ 2, 10. The latter was known as the “bone-dry law.”
Ultimately in 1948, the citizens of Kansas recognized prohibition neither ended liquor consumption nor eliminated its sale. The constitution was amended to permit the legal sale of liquor. L. 1947, ch. 248, § 1. As a result the Kansas Liquor Control Act (K.S.A. 41-101 et seq.) was passed in 1949 ending 69 years of constitutional prohibition. It provided for the regulation of the manufacture, distribution, sale, possession and consumption of alcoholic liquors. The act has remained virtually unchanged except for the 1965 Private Club Act (K.S.A. 41-2601 et seq.) and the 1978 Restaurant Club Act (K.S.A. 1978 Supp. 41-2601 et seq. and K.S.A. 1978 Supp. 41-803). It provides for a three-tiered distribution system composed of a manufacturer, distributor and retailer, none of whom may own any interest in the other and all are licensed by the state.
The original law required that alcoholic liquor be sold subject to the provisions of the Kansas Fair Trade Act (G.S. 1949, 50-301 - 50-310) which effectively established a minimum price. The Fair Trade Act was declared unconstitutional and void, in violation of Art. 2, § 1 of the Constitution of Kansas, in 1958. Quality Oil Co. v. du Pont & Co., 182 Kan. 488, 322 P.2d 731 (1958). During the 1959 legislative session, a liquor price control act was enacted which governed the sale price of alcoholic liquors. In 1961 it was found unconstitutional by this court on the grounds it was an unauthorized delegation of legislative authority to private persons without guidelines. State, ex rel., v. Mermis, 187 Kan. 611, 358 P.2d 936 (1961).
Immediately following that decision, the legislature enacted the liquor price control law (K.S.A. 41-1111 — 41-1121) which remained effective until H.B. 2020 went into effect. It provided that the pricing began with the manufacturer who must sell to the distributor at a price “as low as the lowest price for which the item is sold anywhere in any state in the continental United States . . . .” K.S.A. 41-1112. This is known as a price affirmation law. It should be noted the legislature delegated the authority to fix the beginning price on liquor to the manufacturer from prices determined by competition. This arrangement was held valid in Laird & Company v. Cheney, 196 Kan. 675, 414 P.2d 18 (1966).
After the manufacturer established the beginning price and had it affirmed, the Alcoholic Beverage Control Board of Review (ABC) established a reasonable markup for the distributor and retailer taking into consideration all business costs and a reasonable profit. Each distributor was authorized to sell any brand of liquor anywhere in the state to any retailer. This system is known as “open franchising.” In addition, it prohibited retailers from purchasing from a manufacturer and having him send invoices to distributors who in turn would bill the retailer with the goods sent directly from manufacturer to retailer. Kansas requires the liquor be shipped exclusively to the distributor’s warehouse. This is known as an “at rest” law. Kansas law also requires distributors to purchase liquor only from brand owners or manufacturers, or their exclusive agents. This purchase arrangement has been categorized as a “primary source”.law. An excellent discussion of the historical and economic background of alcoholic liquor in Kansas is found in an unpublished article, “The Status of Alcoholic Liquor in the State of Kansas: A Progress Report,” written by William T. Terrell, Associate Professor of Economics at Wichita State University.
Reflecting constituent complaints on pricing and ABC complaints of illegal retail purchases out of state, the 1978 legislature created a Special Committee on Liquor Laws to conduct a study seeking remedies for the complaints. H.B. 2020 was the result of the Committee’s study.
Briefly, H.B. 2020 is an attempt to obtain liquor prices which are competitive with surrounding states by introducing competition into the three-tiered structure. The affirmation technique at the manufacturer level was retained but at the distributor level, H.B. 2020 permits the distributor to negotiate brand franchise contracts for a territory statewide area or less, and allows the price to seek its own level in the market place as a result of competition between brands. The wholesale price established by the competition plus a reasonable markup determined by the ABC Board then becomes the retailer’s minimum price to the consumer. The distributor must respect the franchise territory he has acquired and may not sell outside that area. There were nine licensed liquor distributors in Kansas at the time of trial: Standard Liquor Corporation; Grant-Billingsley Fruit Co., d/b/a Grant-Billingsley Wholesale Liquor Co., Inc.; Colby Distributing Co., Inc.; Kansas Distributors, Inc.; Eastern Distributing, Inc.; A-B Sales, Inc.; Sunflower Sales Co.; Famous Companies, Inc.; and D. A. Winters Co., a sole proprietorship. Neither Famous nor Winters are parties or intervenors in this suit. Colby sold its business to Standard during the pendency of the appeal. The Wholesale Dealer’s Association supported the passage of H.B. 2020; however, after its enactment, in the scramble for brand franchises, Colby, Grant-Billingsley, and Kansas Distributors were unsuccessful in obtaining the brands or area they sought. Standard and Famous each obtained statewide franchises on numerous popular brands of liquor. A-B Sales, Sunflower and Eastern Distributing were satisfied with their franchises, although the areas are less than statewide and are for fewer brands than Standard and Famous. The franchise alignment resulted in at least two wholesale competitors for all types of alcoholic liquor in every area of the state.
H.B. 2020 became effective May 10, 1979, but provided all distributors would have 120 days thereafter to dispose of the accumulated inventories of liquor brands for which they had not obtained a franchise. This action was filed July 17, 1979, by Kansas Distributors, Colby and Grant-Billingsley, against the secretary of revenue, director of alcoholic beverage control and members of the Alcoholic Beverage Control Board of Review. At that time, the trial court entered a temporary restraining order preventing implementation of H.B. 2020 until August 31, 1979.
On August 3,1979, Standard, A-B Sales, Sunflower and Eastern were permitted to intervene in opposition to plaintiff’s position; Vern Miller, Sedgwick County District Attorney, and The Kansas Retail Liquor Dealers Association intervened in support of the plaintiffs. It was never clarified by the parties why the district attorney of Sedgwick county was permitted to intervene on behalf of the people of Kansas in opposition to the attorney general.
The case was tried August 6 and 7, 1979. Plaintiff’s evidence consisted of the testimony of John F. Grant, president of GrantBillingsley Wholesale Liquor Co. and Albert C. Becker, president of Kansas Distributors, Inc., both of whom testified they did not oppose H.B. 2020 until they discovered they could not obtain the brand franchises or the territory they had anticipated. They stated Standard and Famous each held statewide franchises on a number of well known brands of wines and distilled spirits representing 32.33% and 31.83%, respectively of the total brands sold. They introduced documents showing the specific brands each had negotiated with suppliers. Both witnesses admitted plaintiffs had mutually agreed Colby would take the western Kansas territory, Grant-Billingsley central Kansas, and Kansas Distributors, Inc. eastern Kansas. Each would have the same brands, altogether constituting a statewide franchise. They further testified that as a result of Famous and Standard obtaining statewide franchises on so many popular brands, their projected volume would be reduced by two-thirds and they would be driven out of business.
Plaintiff’s one other witness was William T. Terrell, a Wichita State University economist who had made a study of the Kansas Liquor Control Act. He testified in his opinion the exclusive franchise provisions of H.B. 2020 would create a wholesale liquor monopoly. He also stated, however, that under the law prior to H.B. 2020, Kansas was more of a control or monopoly state than a license state.
Defendants called Sen. Frank Gaines who testified the legislature intended to maintain the three-tiered liquor control system in Kansas and passed H.B. 2020 as an exercise of the police power to lower prices to the consumer, maintain an orderly market and eliminate the importation of illegal liquor from out of state, thereby collecting more taxes within the state.
The defendants also called Leslie J. Rudd, president of Standard Liquor Corporation. He testified there would be brand competition under H.B. 2020 because of the proprietory or economic interest each distributor had in his franchised brands. That interest would create a savings in freight costs, a reduction in warehouse inventory and a more efficient operation, all resulting in a savings to the consumer. He also testified the prices he had filed with the ABC for September were below the prices for the same brands previously filed under the old law.
The challenge to the bill’s constitutionality generally centers around the sections dealing with exclusive franchising and price fixing by distributors. The sections under attack are too lengthy to include in this opinion. We have therefore, included the trial court’s brief summation of the pertinent sections of H.B. 2020.
“a. Sec. 2 allows distributors to sell only such brands of alcoholic liquor to only those retailers whose licensed premises are located within the geographic territory for which such distributor is authorized to sell such brand as designated in the notice or notices filed with the Director pursuant to Sec. 3;
“b. Sec. 3 prohibits any distributor from selling any alcoholic liquor in this state unless such distributor has filed with the Director a written notice stating each geographic territory as has been agreed upon between such distributor and a distiller within which such distributor shall sell to retailers one or more brands of such distiller. Said section further provides that no distiller shall grant such a franchise for the distribution of a brand to more than one distributor for all or part of any designated territory. Said section likewise proscribes and limits in sub-sections (3), (4), (5) and (6) the ability of any such distiller or such distributor to terminate or modify any such franchise or to alter the geographic territory designated in such franchise agreement, except for reasonable cause;
“c. Sec. 4 prohibits any distributor of alcoholic liquor from selling a brand or kind of such liquor to any retailer whose licensed premises are located outside said distributor’s exclusive franchise territory for such brand as established under Sec. 3 described hereinabove. Sec. 4 further prohibits any distiller or distributor from fixing, maintaining, coercing or controlling the resale price of such alcoholic liquor to be resold by such distributor or distiller, but specifically authorizes distributors to furnish licensed retailers with a price list of the retail minimum price, including the minimum mark-up, for all such liquor sold by such distributors to such' retailers;
“d. Sec. 5 prohibits any distributor of alcoholic liquor from purchasing any such liquor from any distiller unless such distiller shall file with the Director a written statement agreeing to sell any of the brands or kinds of such liquor manufactured and distributed by such distiller to any distributor licensed in this state and having a franchise to distribute such brands of such liquor, pursuant to Sec. 3, and to make such sales to all franchised distributors at the same current price and without discrimination and to file periodic price lists showing their current prices with the office of the Director. Sec. 5 further prohibits any licensed retailer from purchasing any such liquor from any such distributor unless such distributor shall file with the Director a written statement agreeing to sell any of the brands or kinds of such liquor distributed by such distributor and to provide service in connection therewith to any licensed retailer whose licensed premises are located within the geographic territory of such distributor’s franchise for such liquor, to make such sales to all such licensed retailers at the same current bottle and case price, and without discrimination and to file price lists showing such current bottle and case price in the office of the Director periodically;
“e. Sec. 6 specifically provides that the sales price of alcoholic liquor sold by distiller to licensed distributors of alcoholic liquor shall be no higher than the lowest price for which same is sold to distributors anywhere in the continental United States, and that the minimum mark-ups of such liquor to be sold by retailers licensed in this state should be determined and regulated by the ABC Board and thereby eliminates from any regulation whatsoever the price at which such liquor can be sold by distributors to retailers and the minimum price at which such liquor can be sold by retailers to consumers.
“f. Sec. 7, Sec. 8, Sec. 9 and Sec. 10 deal with the establishment of ABC Board of minimum mark-up which shall be charged by retailers in sales of alcoholic liquor to consumers;
“g. New Sec. 11 provides for a period of 120 days or until September 10,1979, wherein a presently licensed distributor, such as the Plaintiffs herein, may sell any alcoholic liquors that such distributor may have on hand at the time this Act takes effect in the same manner, and to the same purchasers as such distributor was authorized to sell the same prior to May 10, 1979.”
Section 14 is the amending and repealing portion of the bill.
The trial court rendered its decision on August 31, 1979. It found:
“4. The state has the right to establish and regulate franchise areas under the police power to regulate the liquor industry so long as these laws do not interfere or impede valid federal law or constitutional safeguards. Providing for suppliers and distributors to establish exclusive franchise areas without state intervention or state power to control or regulate has no reasonable rational relation to the purpose of fostering temperance and orderly marketing conditions. The effect of the exclusive franchise system authorizes private persons to engage in anti-competitive conduct and constitutes a violation of the Sherman Act.
“5. It is even more pernicious to allow price fixing with an exclusive franchise to sell, both controlled by the same non-government entity, without regulation by the state.
“Therefore, the following sections are declared void in accordance with these findings, conclusions and decisions:
a. Section 7
b. Section 8
c. Section 9
d. Section 10
“12. The following sections are valid except as follows:
a. New Section 3(1) - Delete ‘No manufacturers, importer or other supplier shall grant a franchise for the distribution of a brand to more than one distributor for all or part of any designated territory.’
b. Section 6 - Delete ‘and (b) that minimum mark-ups on alcoholic liquor sold by retailers licensed in this state should be determined and regulated by law.’
c. Section 10(2) - Delete ‘plus minimum mark-up.’
All other sections are valid.”
A permanent injunction was granted with the judgment barring implementation and enforcement of the invalid portions of H.B. 2020.
On September 5, 1979, the trial court denied defendants’ application for an injunction pending an appeal, which enabled the defendants and the ABC Board to continue operating under the prior law, but stayed the judgment until September 10, 1979. Defendants perfected their appeal and on September 10 requested a stay of H.B. 2020 and the trial court’s judgment pending the appeal. This court stayed the trial court’s order but refused to stay H.B. 2020 which became effective that day.
The plaintiffs cross-appealed on September 17, 1979, placing all of the issues raised by the pleadings and the judgment of the trial court before this court, challenging the constitutionality of H.B. 2020.
For purposes of clarity, we will hereafter refer to the plaintiffs as appellees and the defendants as appellants. We will begin our discussion by reviewing several well established rules pertaining to legislative enactments.
“It is fundamental that our state constitution limits rather than confers powers. Where the constitutionality of a statute is involved, the question presented is, therefore, not whether the act is authorized by the constitution, but whether it is prohibited thereby. [Citations omitted.]
“The constitutionality of a statute is presumed, all doubts must be resolved in favor of its validity, and before the statute may be stricken down, it must clearly appear the statute violates the constitution. [Citations omitted.]
“In determining constitutionality, it is the court’s duty to uphold a statute under attack rather than defeat it and if there is any reasonable way to construe the statute as constitutionally valid, that should be done. [Citations omitted.]
“Statutes are not stricken down unless the infringement of the superior law is clear beyond substantial doubt. [Citations omitted.]
“Courts do not strike down legislative enactments on the mere ground they fail to conform with a strictly legalistic definition or technically correct interpretation of constitutional provisions. The test is rather whether the legislation conforms with the common understanding of the masses at the time they adopted such provisions and the presumption is in favor of the natural and popular meaning in which the words were understood by the adopters. [Citations omitted.]” State ex rel. Schneider v. Kennedy, 225 Kan. 13, 20-21, 587 P.2d 844 (1978).
City of Baxter Springs v. Bryant, 226 Kan. 383, 598 P.2d 1051 (1979).
As a result of the stays granted in this litigation, in addition to the legislative 120-day delay postponing the effective date of the act (new Section 11, H.B. 2020), the provisions of H.B. 2020 were not in effect on the date of trial, rendering the evidence presented highly speculative. Our concern here is primarily with the constitutionality of the provisions of H.B. 2020 on its face. Appellees allege sections 2, 3,11 and 14 violate the Sherman Anti-Trust Act and, as such, are invalid under the supremacy clause of the U.S. Constitution. U.S. Const., art. VI, cl. 2.
In considering any state law regulating intoxicating liquors, we must begin with the Twenty-first Amendment, the second section of which provides:
“The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.”
The manufacture, sale and use of intoxicating liquors has traditionally been a subject of governmental regulation at both federal and state levels. Such regulation is viewed as a valid exercise of the police power to protect the public health, welfare and morals. See Crane v. Campbell, 245 U.S. 304, 62 L.Ed. 304, 38 S.Ct. 98 (1917); Mugler v. Kansas, 123 U.S. 623, 31 L.Ed. 205, 8 S.Ct. 273 (1887); The License Cases, 46 U.S. 504, 12 L.Ed. 256 (1847). When the Eighteenth Amendment was repealed in 1933 by the Twenty-first Amendment, each state was granted broad regulatory power over liquor traffic within its borders. That regulatory power included the authority to completely forbid the importation of liquor if a state so desired. U.S. v. Frankfort Distilleries, 324 U.S. 293, 89 L.Ed. 951, 65 S.Ct. 661 (1945); State Board v. Young's Market Co., 299 U.S. 59, 81 L.Ed. 38, 57 S.Ct. 77 (1936). A state’s power to regulate intrastate operations of liquor traffic is not restricted by the commerce clause. Ziffrin, Inc. v. Reeves, 308 U.S. 132, 84 L.Ed. 128, 60 S.Ct. 163 (1939). In Hostetter v. Idlewild Liquor Corp., 377 U.S. 324, 330, 12 L.Ed.2d 350, 84 S.Ct. 1293 (1964), the Supreme Court held that “a State is totally unconfined by traditional Commerce Clause limitations when it restricts the importation of intoxicants destined for use, distribution or consumption within its borders.” That holding was more recently affirmed in Seagram & Sons v. Hostetter, 384 U.S. 35, 42, 16 L.Ed.2d 336, 86 S.Ct. 1254 (1966).
Although the Twenty-first Amendment grants broad regulatory powers to a state with regard to intrastate regulation of liquor traffic, a state may not exercise exclusive control over liquor shipments passing through its borders which are destined for interstate use. See Hostetter v. Idlewild Liquor Corp., 377 U.S. 324; Collins v. Yosemite Park Co., 304 U.S. 518, 82 L.Ed. 1502, 58 S.Ct. 1009 (1938).
It is argued the state’s almost absolute regulatory control recognized in Seagram Sc Sons was modified in Craig v. Boren, 429 U.S. 190, 50 L.Ed.2d 397, 97 S.Ct. 451 (1976). In that case, the Supreme Court struck down an Oklahoma law which prohibited the sale of 3.2% beer to males under the age of 21 and females under the age of 18. Okla. Stat. tit. 37, §§ 241 and 245 (1958 and Supp. 1976). The court found the “gender-based differential” contained in the statutes constituted a denial of equal protection to males between the ages of 18 and 20. Because the case concerned statutes pertaining to liquor regulation, the court discussed the role of the Twenty-first Amendment and whether the power it conferred upon states in the field of liquor regulation was strong enough to withstand an equal protection challenge. The court held “the Twenty-first Amendment does not save the invidious gender-based discrimination from invalidation as a denial of equal protection of the laws in violation of the Fourteenth Amendment.” Craig v. Boren, 429 U.S. at 204-205. The issues before the court did not directly involve an application of the Commerce Clause. The court did, however, reaffirm the rule that while the Twenty-first Amendment did not repeal the Commerce Clause, the Amendment “created an exception to the normal operation of the Commerce Clause.” Craig v. Boren, 429 U.S. at 206. That exception is clearly the overwhelming power granted the states in the area of liquor regulation. We find the issues before the court in Craig did not directly involve the state’s regulatory power in liquor traffic and the earlier holdings conferring that power were not modified.
This court has followed the rationale of U.S. Supreme Court cases, commencing with State v. Payne, 183 Kan. 396, 403, 327 P.2d 1071 (1958), where we stated:
“It has been repeatedly held that under the 21st Amendment a state may absolutely prohibit the manufacture, transportation, importation, sale or possession of alcoholic liquors irrespective of when or where produced or obtained, or the use to which they are to be put, and may adopt measures reasonably appropriate to effectuate those inhibitions and exercise full police authority in respect to them, unfettered by the due process clause, the equal protection clause or the commerce clause.”
These general principles were followed in Laird & Company v. Cheney, 196 Kan. 675; and Tri-State Hotel Co. v. Londerholm, 195 Kan. 748, 408 P.2d 877 (1965).
It is argued by appellees that this court deviated from those rules in City of Baxter Springs v. Bryant, 226 Kan. 383. We do not agree with that rationale. City of Baxter Springs involved a suit by the city against the proprietor of a local disco for violation of city ordinances prohibiting dispensing of beer and allowing dancing in the disco. In addition, the proprietor was charged with failure to provide an unobstructed view of the premises from the street. We discussed the application of the Twenty-first Amendment in considering the constitutionality of the city ordinances which pertained to regulation of establishments serving cereal malt beverages. The court held the ordinances unconstitutional because they were not “reasonably calculated to promote the health, sanitation, morals or general welfare of the residents of Baxter Springs . . . .” City of Baxter Springs v. Bryant, 226 Kan. at 392. The central issue before the court in that case was the regulation of certain types of activity in or around an establishment that dispensed cereal malt beverages. This court found a state may not, under color of the Twenty-first Amendment, iim pinge upon individual rights protected by the Due Process and Equal Protection clauses. See Craig v. Boren, 429 U.S. 190. The case did not, however, deal directly with the state’s broad authority to regulate the manufacture, distribution, sale, possession and consumption of alcoholic liquor. We find that regulatory power was not modified or lessened in City of Baxter Springs.
In addition to the weight of authority, both federal and state, which supports the broad regulatory power of a state in the area of alcoholic liquor, we find another rationale for upholding H.B. 2020. The provisions of H.B. 2020 on its face will allow sufficient brand and price competition to withstand allegations of a violation of the Sherman Anti-Trust Act. The law is neutral and provides that any licensed distributor may obtain an exclusive franchise for one or more brand of alcoholic liquor from any licensed manufacturer for any designated area of the state. There are eight distributors, 14 categories of liquor, approximately 80 manufacturers, and well in excess of the 260 brands of alcoholic liquor initially referred to in trial exhibits, each of which is subject to a separate franchise. On its face, that would appear to present ample opportunity for each to exercise its own perserverance to obtain products and territory. If one or more fails to obtain its share of the market the law is not at fault; it is one of the hazards of a free market.
Although appellees introduced testimony showing Standard has 32.33% of the market and Famous has 31.83% of the market, there is no evidence the two companies have together embarked upon a monopolistic venture. Appellees further admit Colby, Grant-Billingsley and Kansas Distributors jointly agreed to make franchise applications for the same brands, each taking a prearranged portion of the state. This indicates they themselves may have conspired to restrain trade. Nothing in the testimony or exhibits proves H.B. 2020, on its face, provides for a combination in restraint of trade. Mr. Terrell concluded a monopoly would eventually result. We believe we may assume competition presently exists and will continue. Should any manufacturer, distributor or combination thereof conspire to restrain trade, the antitrust laws are available as a remedy.
By allowing the liquor price to seek its own level at the second tier of the liquor system, the legislature has released liquor pricing from its former status as a totally controlled commodity. The price is no longer totally regulated, totally fixed and can now fluctuate as the competition in the market place will determine. With respect to exclusive franchising, we have noted there are now at least two distributors operating in every area of the state. Each distributes different brands, which compete with one another. Although each distributor completely controls the distri bution of its brands within its territory we find the competition among brands to be sufficient to withstand claims of restraint of trade. We are urged by appellees to consider the recent California cases of Midcal Aluminum, Inc. v. Rice, 90 Cal. App. 3d 979, 153 Cal. Rptr. 757 (1979), and Rice v. Alcoholic Bev. etc. Appeals Bd., 21 Cal. 3d 431, 146 Cal. Rptr. 585, 579 P.2d 476 (1978). Rice struck down California price maintenance statutes as a violation of policies of the Sherman Anti-Trust Act, while Midcal Aluminum, Inc. struck down fair trade and wine price posting provisions of the California Alcoholic Beverage Control Act, as violative of the Sherman Act. We have carefully considered these cases and find them contrary to our law and without precedent in Kansas.
We now turn to appellees’ specific constitutional arguments. Appellees argue they are denied due process because they are denied the right to continue a lawful occupation. In addition, they argue the Act creates classifications which have no rational, real or substantial relationship to public safety, health, general welfare or legislative purpose in violation of the Fourteenth Amendment of the U.S. Constitution and sections 1 and 2 of the Bill of Rights of the Kansas Constitution. From our examination of the Act, we discern no such classifications or denial of the right to continue operating. All distributors are eligible to franchise any brand with state-wide territory or less. Nothing in the law denies a distributor the right to pursue liquor wholesaling. The legislature enacted legislation permitting exclusive brand franchising comparable to franchises in other industries. The size of the franchise territory and the designation of the brands are left to private agreement under the best traditions of a free society. The stated legislative purpose is to introduce competition into the pricing of liquor to the public, thereby promoting the public welfare and stopping illegal liquor, traffic from out of state by offering a more competitive price. There is nothing before us to show the stated purpose is not working. The appellees’ complaint is an economic one over which this court has little control. As the Court stated in Seagram & Sons v. Hostetter, 384 U.S. at 47:
“[I]t is not ‘the province of courts to draw on their own views as to the morality, legitimacy, and usefulness of a particular business in order to decide whether a statute bears too heavily upon that business and by doing so violates due process. Under the system of government created by our Constitution, it is up to legislatures, not courts, to decide on the wisdom and utility of legislation/ ”
See also State ex rel. Schneider v. Kennedy, 225 Kan. at 21.
Appellees’ final point is that sections 2 through 11 and section 14 of H.B. 2020 are unconstitutional because they provide for an impermissible delegation of legislative authority to private persons in violation of Article 2, section 1 of the Kansas Constitution. They cite Quality Oil Co. v. du Pont & Co., 182 Kan. 488, in support of the argument. Quality is distinguishable from the instant case. There, this court considered the Kansas Fair Trade Act which authorized a trademark owner to contract with one retailer for a minimum retail price for a named brand commodity and all retailers were bound thereby with notice. The non-signers were bound by the price agreement even though they were not parties to the contract. It left to the trademark owner the determination of whether or not a minimum price would be imposed upon which commodities and the amount. Here, the legislature determined it would not regulate wholesale prices but would let them seek their level in the competition of the market place. We understand this technique to be traditional in the capitalist society and thought by most to be the best method of determining a fair market price as long as competition is present. It is difficult to comprehend the logic of how a purposeful legislative decision to remove regulation can be transformed to the unlawful delegation of authority to regulate.
H.B. 2020 reflects the legislature’s determination that a minimum price was necessary to insure an orderly market and to promote temperance and that it should be determined by the competition among wholesalers plus a minimum markup determined by the ABC Board of Review from the formula furnished by the legislature. This constitutes a permissible delegation of the ministerial act of administering the pricing regulation with a clear cut guideline. In Laird & Company v. Cheney, 196 Kan. 675, we held fixing wholesale liquor prices at the lowest price for which the item is sold anywhere in the United States was not violative of the commerce clause, the due process or equal protection clauses of the Fourteenth Amendment or comparable sections of the Kansas Constitution. Such practice is completely parallel to the method authorized in H.B. 2020.
We hold pursuant to the power and authority granted the state by the Twenty-first Amendment and pursuant to Article 15, § 10 of the Kansas Constitution, to promote temperance and for the protection of the general welfare, health and safety of the people of Kansas, the legislature properly acted to permit a system of exclusive brand franchises for distributors of alcoholic liquor in Kansas for the purpose of introducing competitive pricing into the middle tier of the Kansas liquor distribution system and in passing the results of the competition onto the consumer through the retailer at not less than the competitive price, plus minimum markup. We hold Chapter 153 of the 1979 Session Laws of Kansas, known as H.B. 2020, a wholly constitutional enactment of the legislature.
The judgment of the trial court is affirmed in part and reversed in part in conformity with this opinion.
Fromme, J., not participating. | [
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Now on this 1st day of January, 1980, the matter of the request of Harold E. Doherty, attorney at law, for transfer to disability status comes before the Court.
The Court finds that Harold E. Doherty, an attorney, duly admitted to the practice of law in the State of Kansas, has voluntarily requested the Court to transfer him to inactive status pursuant to Rule 208(j) of the Rules Relating to Discipline of Attorneys and that such request should be granted.
IT IS THEREFORE ORDERED that Harold E. Doherty, attorney at law, be and he is hereby transferred to disability inactive status and is hereafter precluded from the practice of law in the State of Kansas until the further order of the Court. | [
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The opinion of the court was delivered by
Fromme, J.:
The Kansas Commission on Civil Rights (KCCR) and Dale E. Jones appeal from a judgment of the district court which set aside an order of KCCR and dismissed the complaint of Jones against The Grain Club. The district court, without an evidentiary hearing, held that the respondent was prejudiced by delay. The finding of prejudice was based on the lapse of thirty-nine months from the date of the alleged act of discrimination to the initial hearing. We reverse and remand for an evidentiary hearing as to the nature of prejudice, if any.
Dale E. Jones, a black person, applied for membership in a Class B food and beverage club, such as is defined in K.S.A. 41-2601 as amended. The club refused to accept him as a member. He filed a complaint on December 13, 1973, with KCCR alleging discrimination because of race. The complaint was filed within six (6) months after the alleged act of discrimination took place as required in the last paragraph of K.S.A. 44-1005. Nothing further transpired until February 18, 1976, when the KCCR notified the club of the filing of the complaint and of the impending investigation. The hearing before the hearing examiner of the KCCR began on September 29, 1976. A decision was entered by the KCCR finding discrimination and determining no prejudice to the respondent occurred by reason of the lapse of time. An application for rehearing pursuant to K.S.A. 44-1010 was denied. An appeal was then taken to the district court under K.S.A. 44-1011. Before the matter could be heard de novo the club filed a motion in the district court to set aside and modify the order of the KCCR. After oral argument and without an evidentiary hearing the order of the KCCR was set aside and the complaint of Jones was dismissed by the district court. Appeal by KCCR and Jones to this court followed.
The findings of the district court are as follows:
“1) The complaint lodged by complainant herein with the Kansas Commission on Civil Rights against respondent was filed 'within six (6) months after the alleged act of discrimination occurring on June 18, 1973.
“2) That the Kansas Commission on Civil Rights sent notification of the filing of such complaint to respondent on February 18, 1976, thirty-two months after the alleged discriminatory act.
“3) That the initial hearing conducted by the Commission’s hearing examiner took place thirty-nine months after the alleged act of discrimination.
“4) That respondent was prejudiced by the Commission’s delay in notifying respondent and conducting an investigation of the alleged discriminatory act.”
The court’s conclusions are:
“1) The complaint was duly filed within six months after the alleged act of discrimination in compliance with K.S.A. 44-1005.
“2) The Commission lacked jurisdiction over the controversy as the Commission did not promptly serve respondent with a copy of the complaint as required by Regulation 21-41-11.
“3) The Commission lacked jurisdiction over the controversy as the Commission did not serve respondent within seven (7) days after the filing of the complaint as required by K.S.A. 44-1005.
“4) The Commission lacked jurisdiction over the controversy as the Commission did not make a prompt investigation of the alleged act of discrimination as required by K.S.A. 44-1005.
“5) Respondent’s constitutional right to procedural due process was denied by virtue of the Commission’s delay in disposing of the complaint, in notifying respondent of the charges against it and in conducting an investigation of the alleged discriminatory act.”
The conclusions bearing upon the court’s judgment are those numbered (2) through (5).
As to conclusion No. 2, the regulation mentioned is K.A.R. 21-41-11 (1975) and it reads as follows:
“Service of complaint. A copy of the complaint and any amendments shall be promptly served by the commission on the respondent. (Authorized by K.S.A. 1974 Supp. 44-1003 and 1004; effective, E-74-14, Dec. 28, 1973; effective May 1, 1975.)”
This regulation did not become effective until ten days after the (Jones) complaint was filed with the KCCR. Under the court’s finding No. 1 and conclusion No. 1, the complaint which is the jurisdictional instrument was filed within the required statutory time of six months. As to the time for service of the complaint, the statute then in effect stated:
“After the filing of any complaint by an aggrieved individual, the commission, or by the attorney general, the commission shall prior to investigation of the complaint, serve a copy on each of the parties alleged to have violated this act . . . .” K.S.A. 44-1005.
It is mutually agreed on appeal that a copy of the complaint was served prior to the commencement of the investigation.
The word “promptly,” as used in K.A.R. 21-41-11, is relative and no definite time limitation can be gleaned from the word itself. The meaning and limitation imposed by the word depends upon the context in which it is used. The facts and circumstances of each case bear upon the meaning to be ascribed to this word. In the absence of any evidence of prejudice dismissal of the complaint is not justified.
The Kansas Administrative Regulations, when adopted, have the force and effect of a statute (K.S.A. 77-425), and as in the case of statutes they will be construed to operate prospectively unless a contrary intent is clearly indicated. Harder v. Kansas Comm’n on Civil Rights, 225 Kan. 556, 559, 592 P.2d 456 (1979).
As to Conclusion of Law No. 3 referring to service within seven (7) days after the filing of the complaint, the correct citation for this statute is K.S.A. 1978 Supp. 44-1005. The amended statute became effective July 1, 1975. The prior statute, K.S.A. 44-1005, in effect when the complaint was filed, required the KCCR to serve a copy of the complaint prior to investigation of the com plaint. The complaint in the present case was filed December 13, 1973, long prior to the effective date of the amended statute. It could not have been the intent of the legislature to give the seven (7) day notice requirement retroactive effect, for to do so would result in requiring the impossible. The seven day period would have expired on the present complaint long before the seven day provision became effective.
We are not impressed by appellee’s argument that the legislature intended that a copy of the complaint be served within seven days after the statute became effective regardless of when the complaint was filed. See Harder v. Kansas Comm’n on Civil Rights, 225 Kan. at 559. The requirement in K.S.A. 1978 Supp. 44-1005 that the Kansas Commission on Civil Rights serve a copy of every complaint on each of the parties alleged to have violated the Kansas Act Against Discrimination within seven (7) days after filing is construed to operate prospectively. No contrary intent is indicated by the provisions of the act. Eakes v. Hoffman-LaRoche, Inc., 220 Kan. 565, 552 P.2d 998 (1976).
As to Conclusion of Law No. 4, concluding that the commission lost jurisdiction of the controversy by failing to investigate the complaint promptly, we note the same observations might be made with regard to conclusion No. 4 as we made to conclusion No. 2. Without an evidentiary hearing on the question of prejudice mere lapse of time alone will not support dismissal of the complaint. No jurisdictional defect arises even though a controversy is held to be barred by lapse of time resulting in prejudice.
To support its position appellee cites KCCR v. Sedgwick County Mental Health Clinic, 220 Kan. 653, 556 P.2d 180 (1976). The case is not controlling. In that case the KCCR in an investigation under the Kansas Act Against Discrimination considered it necessary to apply to the district court for an order to enforce a subpoena duces tecum requesting production of all personnel files of all receptionist-secretaries and clerk-typists employed by respondent from July, 1972, to February, 1975. In affirming the refusal of the district court to enforce the subpoena in the Sedgwick County case this court held the district court has discretion in enforcing a subpoena. When the demands of a subpoena are found by the district court to be unreasonable or oppressive this court on appeal will not reverse the trial court, unless it is clearly shown the trial court abused its discretion. That case is no authority for the position that the KCCR lost jurisdiction over the complaint in this case because of delay in serving a copy of the complaint and failure to conduct a prompt hearing.
The appellee argues the complaint was properly dismissed because to require a hearing after thirty-nine (39) months from the date of the act of discrimination results in denying respondent-appellee constitutional due process. Appellee further argues the provisions of the act relating to notice, time of hearing, and limitations thereon deny it due process. In E.E.O.C. v. Exchange Security Bank, 529 F.2d 1214 (5th Cir. 1976), a claim had been filed in the federal court alleging the racially discriminatory discharge of an employee. The problem of constitutional due process was raised because of alleged procedural defects in the federal act at the administrative level. The circuit court held that, regardless of possible procedural shortcomings at the administrative level, problems of constitutional due process were not present. There, as in our present case, final action by means of a full and complete evidentiary hearing was provided in the courts.
We are not impressed by the due process argument made by respondent-appellee.
Our final consideration which is dispositive of this appeal concerns the district court’s finding of prejudice without an evidentiary hearing to support the finding. In Stephens v. Unified School District, 218 Kan. 220, 546 P.2d 197 (1975), we examined the scope of judicial review provisions in this act as set forth in K.S.A. 44-1011. We concluded that the words of the statute concerning appeal meant what they said. The district court should hear an appeal as a trial de novo. After hearing and evidence on any issue, the district court may affirm the adjudication, may set aside or modify it, or may remand the proceedings to the commission for further disposition. See K.S.A. 44-1011.
The act we are dealing with does not include a statute of limitations, except K.S.A. 44-1005, which provides that “[a]ny complaint filed pursuant to this act must be so filed within six (6) months after the alleged act of discrimination.” The six month provision was satisfied in this case. The district court held the lapse of two years and eight months between the alleged discriminatory act and the issuance of notice was prejudicial.
On appeal to the district court no evidentiary hearing was attempted; therefore, the transcript of evidence made before the KCCR examiner was not in evidence in the district court. If an evidentiary hearing had been provided in the district court the transcript could have been introduced together with such other evidence bearing on the issue of prejudice.
Even in the absence of statutory limitations against processing stale complaints, such complaints may be dismissed by the district court for unreasonable delay in agency processing if the delay results in prejudice. In somewhat analogous situations such as specific performance actions trial courts have refused to enforce claims where prejudice would result from unreasonable delay in prosecuting the claim. See Hochard v. Deiter, 219 Kan. 738, 549 P.2d 970 (1976). The doctrine of laches is an equitable device designed by the courts to bar stale claims.
In Clark v. Chipman, 212 Kan. 259, 510 P.2d 1257 (1973), this court said:
“The mere passage of time is not enough to invoke the doctrine of laches. Lapse of time is necessarily a relative matter in which all surrounding circumstances must be taken into account. Each case must be governed by its own facts and what might be considered a lapse of sufficient time to defeat an action in one case might be insufficient in another.” Syl. ¶ 7.
“Laches in legal significance, is not mere delay, but delay that works a disadvantage to another.” Syl. ¶ 8.
See also Darby v. Keeran, 211 Kan. 133, Syl. ¶ 10, 505 P.2d 710 (1973).
In Chromcraft Corp. v. United States Equal Emp. Op. Com’n, 465 F.2d 745 (5th Cir. 1972), a claim of discrimination was filed against an employer. There was no statutory provision which limited the time for processing. It was over a year before the investigation was undertaken. There it is held a showing of prejudice is necessary before agency action can be set aside for lack of punctuality. See also E.E.O.C. v. Exchange Security Bank, 529 F.2d 1214. In Chromcraft Corp. the circuit court reversed the district court for lack of a showing of prejudice, saying the district court found that the delay resulted from an undisputed work load and an overburdened staff, and that there was no suggestion it resulted from slothfulness, lethargy, inertia or caprice. The delay in such case did not result in the disappearance or loss of material witnesses or records, nor was it shown how the respondent was prejudiced in meeting the allegations of the complaint.
We hold a showing of prejudice is necessary before agency action can be set aside for lack of punctuality. In the present case we have a finding of prejudice based on mere lapse of time. The judgment of the district court setting aside the order of KCCR and dismissing the Jones complaint is reversed. The case is remanded to the district court for an evidentiary hearing and factual findings as to prejudice. If actual prejudice is established by the evidence the order of the KCCR may be set aside on proper evidentiary findings, and the Jones complaint may then be dismissed. If there is insufficient evidence of prejudice the court should overrule respondent’s motion and proceed to hear the appeal de novo. | [
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The opinion of the court was delivered by
Herd, J.:
This is a civil action to recover damages for breach of an oral contract for the purchase and sale of cattle. The case was tried to the court which rendered judgment for the plaintiff-appellee seller in the amount of $14,755.02.
This controversy arose out of the following facts: Phillip Eugene Wendling, a Harvey County farmer and stockman, met Ted Puls, an active cattle buyer, in July, 1973, at the Central Livestock Sale in Hutchinson. Wendling indicated to Puls he might have some cattle for sale around the middle of August, 1973. Puls asked Wendling to call him when he decided to sell.
On August 13, 1973, Wendling called Puls and informed him he had 103 head of cattle for sale. Puls associated himself with George Watson, a veterinarian, for financial assistance and on August 14, 1973, the two drove to Wendling’s farm and inspected the cattle. As a result of negotiation, the parties agreed on a price of 61 cents per pound for 98 head and 59 cents per pound on the remaining 5 head. The cattle were to be officially weighed August 16,1973, on Puls’ trucks with 3% off for shrinkage. At the time of the agreement, Watson gave Wendling his check for $1000 as a down payment on the cattle with the notation thereon “103 cattle.” Wendling deposited the check on August 20, 1973.
On August 16, 1973, Puls went to Wendling’s farm and requested an additional week to take delivery. Wendling granted the additional week, providing the same terms and conditions applied. Puls assured him they did.
Wendling rounded up the cattle and penned them on August 23, 1973, in preparation for delivery pursuant to the agreement but the defendants neither appeared, sent trucks, nor called. Wendling attempted to telephone Puls, but was advised Puls was putting up hay. He then called Watson who said he didn’t know why delivery hadn’t been taken but he would check with Puls. Finally on August 27, 1973, Wendling reached Puls by telephone and demanded an explanation. Puls stated he was still working on his problem of finding a place to put the cattle. Wendling requested additional down payment and Puls refused and suggested that maybe he should sell the cattle to someone else. Wendling told Puls he would need a written release before he was free to negotiate another sale. Puls made no response to the release suggestion. On August 28, 1973, Wendling sought legal advice and was advised he should obtain a written release from Puls and Watson before reselling the cattle. The next day Wendling could not locate Puls but was able to talk to Dr. Watson. Wendling requested Watson and Puls meet him at his lawyer’s office to give him a release so he could sell the cattle. They did not appear at the law office as requested, leaving Wendling uncertain as to their intentions.
Thereafter, on September 11, 1973, Wendling caused the following notice to be served on both men:
“Gentlemen:
This is to notify you, Ted Puls and George Watson, D.V.M., individually and jointly that I the undersigned, Phillip Eugene Wendling, at 10:00 a.m., on the 21st day of September, 1973, at the Farmers Coop Elevator, at Halstead, Kansas, will consider you to have breached the contract entered into with me unless on or before said date and time, you fulfill the terms of said contract entered into on the 14th day of August, 1973, at my farm in Harvey County, Kansas, which contract was as follows:
“You did purchase for cash and were to take delivery of 103 head of feeder cattle on August 16, 1973, at 7:30 a.m. on your trucks at my farm in Harvey County, Kansas and pay for the same in cash after the same were weighed on the trucks at the scales in Halstead, Kansas, as follows:
“98 head at $61.00 per cwt; 5 head at average weight at $59.00 per cwt; all at 3% shrinkage, which cattle at your later requests made from time to time and for your convenience, I have in good faith continued to hold and feed for your convenience awaiting for your compliance with said contract; and I will on the date at the time and place stated above, cause said cattle to be weighed and cause the same to be appraised and a fair market price of said cattle to be established at said time and place and will thereafter pursue such remedies for the breach of said contract as are afforded to me under the uniform commercial code, as provided by the statutes of the State of Kansas.
Phillip Eugene Wendling”
Neither Puls nor Watson responded to the notice. Wendling proceeded to comply with the terms of the notice. He weighed the cattle on September 21, 1973. They weighed 85,540 pounds. Wendling asked three qualified livestock dealers to make a bid on the cattle that same day. The market was so unstable on that date only one of the buyers made an offer. He bid 42 cents per pound. Applying the 3% shrinkage provided in the contract, the net weight for sale was 82,974 pounds. At 42 cents a pound, the total selling price on September 21, 1973, would have been $34,849.08 compared to $50,533.50 as a selling price applying the original contract terms to the same weight. The $50,533.50 contract amount does not include the $1000 down payment paid by defendants on August 14, 1973. Wendling later actually sold the cattle for $39,978.49 in two lots on October 18, 1973, and November 1, 1973.
The trial court held the question of the statute of frauds was not a problem in the case because the parties had admitted through testimony the existence of the agreement, its terms and conditions. They disagreed only on the significance of the $1000 down payment. The court held the seller in this case had a right to retain the down payment and apply it toward his damages. In addition, he held if the down payment was inadequate to cover all of his damages, Wendling could bring an action to recover his excess damages.
The court further held the tendency of modern authority was that time is not ordinarily of the essence in a contract unless made so by stipulation or unless that intent is manifested by the parties. The court found that time was not of the essence in the contract for sale between the parties in this case. The court found that plaintiff’s actions in holding the cattle for the defendants beyond the August 23, 1973, delivery date and
“in electing to forestall the declaration of a breach of the contract in an attempt to secure the performance of the defendants thereto, were reasonable and it was proper under the circumstances for plaintiff to set a reasonable time in which defendants were required to complete the contract; that the September 21, 1973, date set by plaintiff for defendants to complete the contract was reasonable; that September 21, 1973, is a proper date upon which to measure plaintiff’s damages for breach of the contract by the defendants.”
The court found defendants breached the contract when they failed to take delivery of the cattle on or before September 21, 1973. Plaintiff’s damages were computed, pursuant to K.S.A. 84-2-708, to be the difference between the
“contract price computed as to the weight of the cattle on September 21 ($50,533.59) and the fair market value of the cattle on that date ($34,849.08), plus plaintiff’s incidental damages incurred in the way of freight costs ($70.51), but less the amount of the down payment tendered by the defendants ($1,000.00).”
The trial court found the seller was not under a resale obligation and the fact that he did later resell the cattle did not bear on his ability to elect his damage remedy pursuant to K.S.A. 84-2-708. Plaintiff was granted judgment against defendants in the amount of $14,755.02, plus interest and costs. Appellants Puls and Watson appeal.
Appellants’ first issue pertains to a construction of K.S.A. 84-2-708. They question whether the statute permits the seller to select a tender of delivery date where the contract is uncertain and treat the selected date for fixing damages upon the buyer’s failure to respond. In raising the issue, appellants admit the contract of sale, its terms and the proposed delivery date. The Uniform Commercial Code is to be liberally construed (K.S.A. 84-1-102) and every duty within the act imposes an obligation of good faith in its performance. (K.S.A. 84-1-203). K.S.A. 84-1-204 provides that a reasonable time for taking action depends on the nature, purpose and circumstances of such action. K.S.A. 84-2-703 provides:
“Seller’s remedies in general. Where the buyer wrongfully rejects or revokes acceptance of goods or fails to make a payment due on or before delivery or repudiates with respect to a part or the whole, then with respect to any goods directly affected and, if the breach is of the whole contract (section 84-2-612), then also with respect to the whole undelivered balance, the aggrieved seller may
“(a) withhold delivery of such goods;
“(b) stop delivery by any bailee as hereafter provided (section 84-2-705);
“(c) proceed under the next section respecting goods still unidentified to the contract;
“(d) resell and recover damages as hereafter provided (section 84-2-706);
“(e) recover damages for nonacceptance (section 84-2-708) or in a proper case the price (section 84-2-709);
“(f) cancel.”
K.S.A. 84-2-708(1) provides:
“Seller’s damages for nonacceptance or repudiation. (1) Subject to subsection (2) and to the provisions of this article with respect to proof of market price (section 84-2-723), the measure of damages for nonacceptance or repudiation by the buyer is the difference between the market price at the time and place for tender and the unpaid contract price together with any incidental damages provided in this article (section 84-2-710), but less expenses saved in consequence of the buyer’s breach.”
It is clear the correct measure of damages is “the difference between the market price at the time and place for tender and the unpaid contract price.” Desbien v. Penokee Farmers Union Cooperative Association, 220 Kan. 358, 369, 552 P.2d 917 (1976). See Neiswender v. Bolen, 113 Kan. 271, 214 Pac. 96 (1923); Rock v. Gaede, 111 Kan. 214, 207 Pac. 323 (1922). Appellants argue the Desbien case supports their contention the delivery date agreed upon by the parties, August 23, 1973, is the correct date from which to measure damages.
Giving K.S.A. 84-2-708(1) a liberal construction in the absence of any evidence of bad faith, did the nature, purpose and circumstances of this case justify Wendling’s act of setting the tender date as of September 21,1973? We believe that action was proper in this case. Wendling advised Puls and Watson he did not feel free to sell the livestock without a written release. Appellants made no response. Wendling advised Watson of a proposed meeting of all parties, to be held in his lawyer’s office for the purpose of obtaining a written release. Neither appellant replied and neither appeared at the appointed time. Wendling then sent the notice on September 11, 1973, to both appellants fixing the “tender” date at September 21,1973, giving appellants 10 days to respond. They again chose to make no response. At that time the contract was not clearly in breach and the delivery date remained uncertain. “(1) Tender of delivery requires that the seller put and hold conforming goods at the buyer’s disposition and give the buyer any notification reasonably necessary to enable him to take delivery.” K.S.A. 84-2-503(1). The Official Comment following this section of the Code states: “ ‘tender’ connotes such performance by the tendering party as puts the other party in default if he fails to proceed in some manner.” Considering the letter and spirit of the Code, we find appellee’s actions were made in good faith and were commercially reasonable under the nature and circumstances of this case. The damages were properly set as of September 21, 1973.
Appellants’ second issue is as follows: After Wendling accepted and cashed a down payment check of $1000, can he claim damages in excess of that sum in light of K.S.A. 84-2-718 or in light of the custom and usage in the cattle trade?
Appellants argue custom and usage in the livestock industry considers all down payments on livestock purchase contracts to be liquidated damages, thereby eliminating the need for a specific agreement.
We held in McSherry v. Blanchfield, 68 Kan. 310, 75 Pac. 121 (1904), that custom and usage cannot be shown to create a contract where none existed, but rather its use is restricted to the explanation of technical or trade terms in a contract. This court went on to point out that it must first be shown either that the other party had knowledge of such a custom or that the knowledge among those in the business or industry was so notorious as to furnish a presumption that the other party had knowledge of it. These principles have often been applied. See Shepard v. United States Fidelity & Guaranty Co., 210 Kan. 652, 504 P.2d 228 (1972); Jukes v. North American Van Lines, Inc., 181 Kan. 12, 309 P.2d 692 (1957); Radio Station KFH Co. v. Musicians Ass’n. Local No. 297, 169 Kan. 596, 220 P.2d 199 (1950); Peoples Ice & Fuel Co. v. Dickey Oil Co., 145 Kan. 351, 65 P.2d 319 (1937); Benton Grain Co. v. Reger, 131 Kan. 735, 293 Pac. 955 (1930).
In Radio Station KFH Co. v. Local No. 297, 169 Kan. at 603, we discussed the standard of proof required in custom and usage cases as follows:
“The requisites of a good custom must all be established by evidence which is clear and convincing.”
The trial court found the evidence of custom and usage was insufficient to show such a custom exists in the cattle trade. We find the appellants failed to meet the required standard of proof and we will not disturb the trial court’s findings and conclusions of law as to this issue.
K.S.A. 84-2-718 provides parties to a sales contract may agree to a reasonable amount of liquidated damages in the event of breach. That statute states:
“Liquidation or limitation of damages; deposits. (1) Damages for breach by either party may be liquidated in the agreement but only at an amount which is reasonable in the light of the anticipated or actual harm caused by the breach, the difficulties of proof of loss, and the inconvenience or nonfeasibility of otherwise obtaining an adequate remedy. A term fixing unreasonably large liquidated damages is void as a penalty.
“(2) Where the seller justifiably withholds delivery of goods because of the buyer’s breach, the buyer is entitled to restitution of any amount by which the sum of his payments exceeds
“(a) the amount to which the seller is entitled by virtue of terms liquidating the seller’s damages in accordance with subsection (1), or
“(b) in the absence of such terms, twenty percent of the value of the total performance for which the buyer is obligated under the contract or $500, whichever is smaller.
“(3) The buyer’s right to restitution under subsection (2) is subject to offset to the extent that the seller establishes
“(a) a right to recover damages under the provisions of this article other than subsection (1), and
“(b) the amount or value of any benefits received by the buyer directly or indirectly by reason of the contract.
“(4) Where a seller has received a payment in goods their reasonable value or the proceeds of their resale shall be treated as payments for the purposes of subsection (2); but if the seller has notice of the buyer’s breach before reselling goods received in part performance, his resale is subject to the conditions laid down in this article on resale by an aggrieved seller (section 84-2-706).”
Appellants argue “if the contract provides for a down payment but not for liquidation of damages, this section [K.S.A. 84-2-718] in effect liquidates them.” Appellants argue they are entitled to a refund of their down payment in excess of $500, except that Wendling can offset any damages he proves he has the right to recover. Appellants claim that Wendling may take only $952.70. They arrive at this figure by subtracting $500 (they claim Wendling would keep $500 of the original $1000, pursuant to K.S.A. 84-2-718[2][b]), from $1452.70, a figure they claim represents the true difference between the market price on the date of delivery and the contract price. They measure the date of delivery from August 23,1973, rather than September 21,1973. We do not agree with this construction of K.S.A. 84-2-718. First, there is no written agreement between the parties regarding the amount of liquidated damages to be recovered in the event of breach by the parties. The down payment check itself does not serve as a clear agreement and there is no evidence the parties intended it to indicate a firm agreement regarding damages. Second, we agree that where a seller withholds delivery of the goods because of a buyer’s breach, the buyer is entitled to restitution of his down payment, pursuant to K.S.A. 84-2-718(2)(o), or, in the absence of an agreement, pursuant to the formula set forth in K.S.A. 84-2-718(2)(h). The appellants seem to have overlooked, however, the next section of the statute which states the buyer’s right to restitution is subject to offset to the extent the seller establishes “(a) a right to recover damages under the provisions of this article other than subsection (1).” The seller in this case has his remedy under K.S.A. 84-2-708. The entire down payment must be applied to the amount recovered pursuant to that statute. In this case, we have already determined the date upon which to base the seller’s damages. That date is September 21,1973, rather than August 23, 1973. Therefore, appellants’ proposed recovery formula will not stand. This issue is without merit.
Finally, appellants contend the Statute of Frauds controlled by K.S.A. 84-2-201 precludes enforcement of this contract. K.S.A. 84-2-201 provides:
“Formal requirements; statute of frauds. (1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing.
“(2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subsection (1) against such party unless written notice of objection to its contents is given within ten days after it is received.
“(3) A contract which does not satisfy the requirements of subsection (1) but which is valid in other respects is enforceable
“(a) if the goods are to be specially manufactured for the buyer and are not suitable for sale to others in the ordinary course of the seller’s business and the seller, before notice of repudiation is received and under circumstances which reasonably indicate that the goods are for the buyer, has made either a substantial beginning of their manufacture or commitments for their procurement; or
“(b) if the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract for sale was made, but the contract is not enforceable under this provision beyond the quantity of goods admitted; or
“(c) with respect to goods for which payment has been made and accepted or which have been received and accepted (section 84-2-606).”
This is a specious argument. Not only have all the parties frankly and openly admitted the existence of the contract during trial testimony, with complete agreement on price, quantity of purchase and date of delivery, but the seller served a written notice on buyers containing all the terms and conditions of the contract, to which buyers offered neither written nor oral objections. The requirements of K.S.A. 84-2-201(3) (b) are met.
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The opinion of the court was delivered by
McFarland, J.:
Mobil Oil Corporation filed an application with the State Corporation Commission for the assignment of an allowable at the appropriate time and for a noncontiguous acreage attribution exception for a well to be drilled in the Panoma Council Grove Gas Field in Stevens County, Kansas. The proposed unit consisted of three 160-acre tracts and a 4/7 undivided interest in a fourth 160-acre tract. The State Corporation Commission granted the application as to the first three tracts, but denied the application as to the fourth tract on the ground of lack of jurisdiction. Mobil appealed the order to the district court of Stevens County. The district court upheld the State Corporation Commission and Mobil brings this appeal. The intervenors in this action are the owners of the undivided 3/7 mineral interest in the excluded tract.
The question before us is one of first impression and is whether or not the State Corporation Commission (hereinafter referred to as “Commission”) has jurisdiction to consider a fractional undivided mineral interest for inclusion in a noncontiguous acreage exception for a gas well. The Commission concluded that it lacked jurisdiction herein by virtue of the fact that inclusion of the 4/7 undivided interest in the unit could have the possible effect of forcing unitization on the owners of the remaining 3/7 undivided interest. All parties agree that the Production and Conservation of Natural Gas Act (K.S.A. 55-701 et seq.) confers no powers to the Commission by which it could compel unitization.
Mobil leased the entire 160-acre tract in dispute in 1929. The lease did not contain a unitization clause. Mobil sought to form a production unit of the four tracts in the Panoma Council Grove Field. The owners of the mineral rights in three tracts consented, as did the owners of the 4/7 undivided mineral interest in the fourth tract. The owners of the 3/7 undivided interest in the fourth tract did not consent. Therefore, the application filed by Mobil with the Commission was for a proposed unit of 571 acres (160+160+160+91). The proposed unit was to be open-ended in order that the remaining 69 acres could join at a later time if the owners desired.
In order to understand the rationale of the Commission, it is necessary to include herein a major portion of its order of May 19, 1977, as follows:
Order of the Commission
“1. K.S.A. 55-701 prohibits the production of natural gas in the State of Kansas when such production may only be accomplished in a manner or under a condition or for such purposes which may constitute waste. K.S.A. 55-703 permits the State Corporation Commission to exercise its jurisdiction whenever it determines that the orderly development of, and production of gas from, any common source of supply requires such exercise. In addition, the Commission may promulgate production regulations if the available production of natural gas from a common source of supply is in excess of the market demand for gas from that supply.
“2. In its Revised Basic Proration Order for the Panoma Council Grove Gas Pool, Docket No. 60,024-C (C-7058), the Commission concluded that one common source of supply existed in the Council Grove Formation of the lower Permian system. This is the producing formation which is the subject of the present application.
“3. K.A.R. 82-2-207 in the Commission’s General Rules and Regulations for the Conservation of Crude Oil and Natural Gas sets forth those items which are to be included in an application for an allowable to a gas well in a prorated pool. One such item is the exact location of the well and acreage which is to be attributed to the well.
“4. The Applicant has filed an application with the Commission requesting that an allowable be assigned to its G. W. Shell Unit No. 1 Well in the Panoma Council Grove Gas Field. The Applicant has further requested relief from the contiguous acreage attribution requirements contained in the Revised Basic Proration Order for the Field. . . .
“7. Applicant’s G. W. Shell Unit No. 1 Well is to be located approximately 1321 feet from the north line and 1320 feet from the east line of Section 29, Township 34 South, Range 38 West, Stevens County, Kansas.
“8. The Applicant seeks to attribute the following described acreage to its G. W. Shell No. 1 Well:
Northeast Quarter (NE/4) of Section 29; an undivided 4/7 interest in the Northeast Quarter (NE/4) of Section 31; and Southwest Quarter (SW/4) of Section 32, Township 34 South, Range 38 West; and the Southeast Quarter (SE/4) of Section 6, Township 35 South, Range 38 West, all in Stevens County, Kansas.
“9. The acreage described in Finding (8) contains 571 acres, more or less. The leases which Applicant holds covering Sections 32,31 and 6 in the acreage sought to be attributed to the Shell Well do not contain the right of unitizing those leases with others for the purpose of forming a production unit. A unitization agreement allowing the acreage described in Finding (8) to be formed as a gas producing unit has been agreed to by all royalty owners therein except for the Northeast Quarter (NE/4) of Section 31, Township 34 South, Range 38 West, Stevens County, Kansas. The Applicant has obtained the approval of the unitization agreement from those who own an undivided interest in 4/7 of the royalties from production on that particular quarter section. The 3/7 royalty interest owners in that quarter section who have not consented to the unitization agreement with the Applicant appeared at the public hearing in this matter in order to make their objection to the application known. These 3/7 royalty owners further contend that the Commission lacks the authority to compel the unitization of noncontiguous acreage for purposes of attributing land to a gas well where there has been no voluntary agreement to such unitization by the royalty owners.
“10. The Commission is able to regulate only in a manner prescribed by this state’s legislature. The statutory directives in Article 7 of the Kansas Statutes Annotated are primarily aimed at preventing waste and protecting the correlative rights of those with interests in the production of natural gas in the state. At no point in the gas conservation statutes is the Commission able to require the compulsory formation of a production unit without the consent of those with interests in the royalties. Even though the formation of a production unit of separate tracts in the Panoma Council Grove Field may be desirable for the prevention of waste and the protection of correlative rights, the authority to require it may not be implied from the gas conservation statutes. As a result, the Commission is without jurisdiction to approve the attribution of an undivided 4/7 interest of the Northeast Quarter (NE/4) of Section 31, to the G. W. Shell No. 1 Well.
“It is clear that the Applicant would not be able to produce gas from only 4/7 of that acreage. Rather, the Applicant would be taking gas from the entire quarter section. Thus, attributing the undivided 4/7 interest would either have an effect similar to a partitioning of the interests in this property, or violate the rights of those with the remaining undivided 3/7 interests in the quarter section, and thus possibly compel them to join in the unit. The Commission is unable to bring about either of these results.
“11. There are producing gas wells into the Hugoton pay zones in each of the quarter sections listed in Finding (8), with the exception of the Northeast Quarter of Section 29. A Hugoton well in the NE/4 of Section 31 has that 160 acres attributed thereto, one in the Southeast Quarter of Section 6 has attributed to it that 160 acres, and the Hugoton well in the Southwest Quarter (SW/4) of Section 32 has 320 attributable acres. Therefore, the G. W. Shell No. 1 Well will not be located on an existing noncontiguous unit to which a Hugoton allowable has been granted.
“12. A present and future market for the gas exists because the gas to be produced from Applicant’s G. W. Shell No. 1 Well will be sold to Northern Natural Gas Company at a price of $0.52 per Mcf at 14.65 pounds per square inch absolute pressure base. Utilization of the gas from the G. W. Shell No. 1 Well is for a purpose permitted by the laws of Kansas and the rules and regulations of this Commission. Furthermore, such utilization does not constitute waste.
“13. The Revised Basic Proration Order for the Panoma Council Grove Gas Pool, as amended, provides for the granting of exceptions to the contiguous acreage provisions of said Order whenever:
“1. The granting of such exception is necessary to prevent waste and to protect correlative rights; and
“2. A reasonable attempt has been made to include the acreage sought to be attributed in contiguous units; and
“3. All acreage concerned is proven to be reasonably comparable in the Council Grove Pay Formation.
“Furthermore, all acreage attributed to a well must be productive of gas.
“14. The following described acreage is the closest acreage available for the formation of the unit when the existing Hugoton units and the Applicant’s plans for development are considered:
The Northeast Quarter of Section 29 and the Southwest Quarter of Section 32, Township 34 South, Range 38 West, and the Southeast Quarter of Section 6, Township 35 South, Range 38 West, all in Stevens County, Kansas.
“In addition, geological testimony indicated that the three quarter sections described in this Finding are reasonably comparable in productive capabilities, and that all three quarter sections are productive of gas. Furthermore, the Commission finds that granting the noncontiguous acreage exception for the said three quarter sections will prevent waste and protect correlative rights.
“15. The application should be granted to the extent discussed herein.
“It Is, Therefore, by the Commission Ordered: That the application of Mobil Oil Corporation for the assignment of an allowable and a noncontiguous acreage attribution exception for a well to be drilled in the Panoma Council Grove Gas Field, Stevens County, Kansas, be granted in part and denied in part; that there be an exception to the contiguous or adjoining acreage provision of the Revised Basic Proration Order for the Panoma Council Grove Gas Field and the acreage described in Finding (14) is hereby attributed to the Applicant’s G. W. Shell Unit No. 1 Well; and upon the filing of an acreage and attribution certificate with the Conservation Division, 245 N. Water, Wichita, Kansas, an appropriate gas allowable be assigned thereto.
“This order shall become effective forthwith, and said allowable shall be assigned to said well upon said date, or upon the date of the beginning of the deliverability test, or upon the date of the filing of the certificate of the acreage plat, whichever date is later.”
In its order of July 8, 1977, relative to Mobil’s application for reconsideration, the Commission stated:
“1. The Commission is unable to act in a manner which would, in essence, partition the interests in the Northeast Quarter (NE/4) of Section 31, Township 34 South, Range 38 West, Stevens County, Kansas. A party cannot accomplish through this requested administrative action what should be sought through the courts of the state.
“2. The Commission’s Order in this docket dated May 19,1977, is based upon substantial competent evidence. The record, all pleadings and briefs have been thoroughly reviewed, in addition to a reassessment of the Commission’s duties and jurisdiction under K.S.A. 55-701 et seq. The responsibility of the Commission is to weigh the evidence and determine its credibility while giving all due regard to its authority. This process having occurred in the instant docket, we conclude that the Order of May 19, 1977, is reasonable.
“3. The Order dated May 19,1977, complies with the applicable provisions of K.S.A. 55-701 et seq., in addition to the rules and regulations of the Commission.
“4. As a result of Finding (3) above we conclude that the Order dated May 19, 1977, is lawful.
“5. The Order dated May 19, 1977, should be affirmed.”
Further insight into the rationale of the Commission’s determination that it lacked jurisdiction to consider inclusion of the 4/7 interest in a unit is found in its brief, wherein it states:
“Mobil argues that if the Intervenors (nonconsenting owners) are dissatisfied with the attribution of part of their undivided interest, their remedy is in a court of law. It seems inconsistent that Appellant should accuse the Intervenors of misus ingthe Commission forum while Appellant is eager to use a Commission decision to partition an undivided interest in land and gain an unfair bargaining advantage, all in the name of preventing waste and protecting correlative rights.
“Appellant speaks a great deal about protecting the correlative rights of the consenting 4/7 owners but no mention is made of protecting those of 3/7 nonconsenting owners. If the Commission approves the attribution of the 4/7 undivided interest, the correlative rights of the 3/7 would be effectively denied. They would be required to join the unit under Mobil’s terms, or sue for enforcement of their lease rights, or lose their share in the Panoma Council Grove production. However the Commission’s denial of the attribution does not alter the correlative rights of any owner. The consenting and nonconsenting owners are left in the same position as before the application. Then Mobil must either renegotiate with them on balanced terms or one of the owners must petition a court for partition.
“Instead of taking any action that would alter the bargaining positions of the parties, the Commission in its discretion chose to leave everyone with the remedies available before the application was filed. In support of this idea, Appellee would point out Commission’s findings in the second paragraph of paragraph 10 of its May 19, 1977, order:
“It is clear that the Applicant would not be able to produce gas from only 4/7 of that acreage. Rather the Applicant would be taking gas from the entire quarter section. Thus, attributing the undivided 4/7 interest would either have an effect similar to a partitioning of the interests in this property, or violate the rights of those with the remaining undivided 3/7 interests in the quarter section, and thus possibly compel them to join in the unit. The Commission is unable to bring about either of these results.
“The Commission based its findings on substantial, competent evidence and its decision should not be reversed.”
The district court heard Mobil’s appeal and made the following findings of fact and conclusions of law:
Order of the District Court
“This appeal from an order of the Kansas Corporation Commission allowing a 480-acre noncontiguous unit for Panoma Council Grove production but denying the attribution of the NE !4 31-34-38 in Stevens County, Kansas, arises because the lease on the described quarter section was executed November 30, 1929, and did not anticipate or include the right of lessee to pool said quarter section for purposes of unitized production. The owners of 4/7 interest in the minerals consented to the proposed unit and the remaining owners of the remaining undivided 3/7 did not agree. (The owners of an undivided 1/14 interest later asserted a revocation of their consent but the parties involved agree that a determination of the effect of the revocation is not necessary to a decision determining the validity of the order appealed.)
“Plaintiff in this action, Mobil Oil Corporation, contends that the K.C.C. erred in denying attribution of the 4/7 undivided interest in said 160 acres because said order fails to protect the correlative rights of the owners of said interest and also denies the rights of plaintiff to prevent waste by having an allowable for the largest possible production unit. (Production allowance is set in this field on a combination of attributed acreage and deliverability of the well itself.)
“The Commission and intervenors (owners of the nonconsenting interest) contend that to allow the attribution would be to grant Plaintiff a right it did not acquire in the original lease, would be tantamount to compulsory unitization, and would be in effect allowing the K.C.C. to grant partition to the owners which is an exclusive function of the courts..
“The issue presented appears to be one of first impression not only in Kansas but in any other state except perhaps those with compulsory unitization. However, the implications from Republic Natural Gas Co. v. Baker, 197 F.2d 647, clearly set forth the position of the nonconsenting owners herein.
“The Court finds the reasoning of the K.C.C. persuasive and adopts the briefs herein filed by the Defendant Commission as its legal conclusions herein. Thus, the Court finds that subsequent interest owners cannot modify an existing lease on a tract by dedication of undivided interests to a producing unit absent the consent of all owners.
“The order of the Corporation Commission, appealed herein, is hereby affirmed.”
We must bear in mind that the sole question before us is whether the Commission did or did not have jurisdiction to consider the application as it related to the 4/7 fractional undivided mineral interest. The merits as to whether the Commission should or should not have included it in the exception and granted an allowable thereon are not before us.
We must first examine the scope of the Commission’s jurisdiction herein. The Commission is a creature of statute with limited jurisdiction and it possesses no powers not granted by statute. See Bennett v. Corporation Commission, 157 Kan. 589, 596, 142 P.2d 810 (1943).
The relevant statutes herein are contained in the Production and Conservation of Natural Gas Act as follows:
“55-701. Waste of natural gas prohibited. The production of natural gas in the state of Kansas in such manner and under such conditions and for such purposes as to constitute waste is hereby prohibited.”
“55-702. Definitions. The term ‘waste’ as herein used, in addition to its ordinary meaning, shall include economic waste, underground waste and surface waste. Economic waste as used in this act, shall mean the use of natural gas in any manner or process except for efficient light, fuel, carbon black manufacturing and repressuring, or for chemical or other processes by which such gas is efficiently converted into a solid or a liquid substance. The term ‘common source of supply’ wherever used in this act, shall include that portion lying within this state of any gas reservoir lying partly within and partly without this state. The term ‘commission’ as used herein shall mean the state corporation commission of the state of Kansas, its successors, or such other commission or board as may hereafter be vested with jurisdiction over the subject matter of this act.”
“55-703. Production regulations; rules and formulas. Whenever the available production of natural gas from any common source of supply is in excess of the market demands for such gas from such common source of supply, or whenever the market demands for natural gas from any common source of supply can be fulfilled only by the production of natural gas therefrom under conditions constituting waste as herein defined, or whenever the commission finds and determines that the orderly development of, and production of natural gas from, any common source of supply requires the exercise of its jurisdiction, then any person, firm or corporation having the right to produce natural gas therefrom, may produce only such portion of all the natural gas that may be currently produced without waste and to satisfy the market demands, as will permit each developed lease to ultimately produce approximately the amount of gas underlying such developed lease and currently produce proportionately with other developed leases in said common source of supply without uncompensated cognizable drainage between separately-owned, developed leases or parts thereof.
“The commission shall so regulate the taking of natural gas from any and all such common sources of supply within this state as to prevent the inequitable or unfair taking from such common source of supply by any person, firm or corporation and to prevent unreasonable discrimination in favor of any one common source of supply as against another and in,favor of or against any producer in any such common source of supply. In promulgating rules, regulations and formulas, to attain such results the commission shall give equitable consideration to acreage, pressure, open flow, porosity, permeability and thickness of pay, and such other factors, conditions and circumstances as may exist in the common source of supply under consideration at the time, as may be pertinent: Provided, however, That the daily takes of gas from any well in an unprorated gas pool shall not exceed twenty-five percent (25%) of its open flow: Provided further, however, That the provisions of this act shall not apply to any common source of supply in which the average open flow of all the producing wells therein is not in excess of seven hundred fifty thousand (750,000) cubic feet per day.
“The commission in determining the market demand for gas from a common source of supply shall consider the reasonable current requirements for current consumption and use within and without the state, and such other factors, conditions, or circumstances that would aid in establishing the market demand.”
“55-703a. Well spacing and orderly development. The drilling and completion of a gas well shall not of itself entitle said well to an allowable for production; and the commission may, in its discretion, provide for well spacing in any such common source of supply and provide for the orderly development thereof.”
“55-704. Rules and regulations authorized; notice and hearings. The commission shall promulgate such rules and regulations as may be necessary for the prevention of waste as defined by this act, the protection of all water, oil or gas-bearing strata encountered in any well drilled in such common source of supply, ascertaining the several factors entering into the determination of the productive capacity of each well, the total productive capacity of all wells in the common source of supply, the establishment of such other standard or standards as the commission may find proper to determine the productive capacity of each well and of all wells in such common source of supply, and as the commission may find necessary and proper to carry out the spirit and purpose of this act: Provided, however, That notice, as provided in K.S.A. 55-706, shall be served upon or given to the producers and purchasers of natural gas and all other persons, firms or corporations interested, of any hearing or hearings which may be called for the purpose of establishing any facts upon which any proposed rule or regulation may be based.”
“55-705a. Certificate required; notice and hearing. Before any gas shall be produced from a well producing gas only, or from a well which is primarily a gas well, for any of the purposes specified in K.S.A. 55-702, a certificate shall be obtained from the commission for the construction of the facilities necessary or required and/or the utilization of the gas in the manner and for the purposes intended; and the commission shall issue such certificate unless it finds, upon application and after hearing, that the contemplated production or use of such gas is in violation of this act: Provided, however, That no such certificate shall be required on account of such facilities as were in existence or under construction, or such uses as were being made of such gas, on February 1, 1945.”
“55-705b. Application; notice. No allowable shall be granted by the commission for any gas well except upon application duly verified setting forth the location of the well and the description of the acreage attributable thereto, the common source of supply in which the same is located and such other information as the commission may require. Upon the filing of any such application the same shall be duly docketed and notice thereof given in the manner and for the time provided in K.S.A. 55-706.”
“55-706. Proceedings before commission upon petition; designation of certain officers or employees to conduct investigations and hearings; powers; findings and recommendations, (a) Proceedings may be instituted before the commission upon petition of any interested party, or by the attorney general on behalf of the state, or on the motion of the commission, upon any question relating to the enforcement of this act or the promulgation, revocation, amendment, renewal, interpretation, extension, or the enforcement of any rule, regulation or order, or the determination of any right thereunder, in the manner provided in K.S.A. 55-605, and that each and all of the provisions of said section as amended, shall apply to and govern such proceedings under this act.
“(b) The state corporation commission is hereby authorized to designate or appoint its director of petroleum conservation or its assistant director of petroleum conservation or one of its attorneys as an examiner or referee to make investigations and conduct hearings that are required of the commission by act of which this section is amendatory. Such investigations and hearings shall be made and conducted in the same manner as by the commission. Such examiners and referees shall have the power to administer oaths and to subpoena witnesses. The commission may provide for a record to be made of any hearing or investigation. Such examiners and referees shall submit their findings and recommendations in writing to the commission.”
On March 19, 1962, the Commission issued the Revised Rasic Proration Order for the Panoma Council Grove Gas Pool. This order provides, in relevant part:
“1. The Panoma Council Grove Pool, the reservoir here under consideration, is made up of numerous interbedded limestone and shale members and lies within what is commonly referred to as the Council Grove Group of the lower Permian system. Gas is generally encountered in the limestone members therein between depths of 2600 feet to 3000 feet below the earth’s surface. . . .
“3. . . .
“In order to safeguard the correlative rights of landowners and operators in this pool and to prevent disproportionate production therefrom and in order to provide for orderly development of new wells, it is necessary, as contemplated by G.S. 1961 Supp. 55-703, for the Commission to take jurisdiction of this Pool and to prescribe rules and regulations for the drilling of wells and production of gas to the end that each person may take therefrom only such portion, of the amount that may be produced without waste, as will permit each developed lease to ultimately produce the volume of gas which underlies such lease.
“4. The exact geographical limits of the Panoma Council Grove Pool cannot be definitely established until much additional exploration and development has taken place. Nevertheless, the Commission has the statutory power and duty to assume jurisdiction over a common source of supply before such common source of supply has been fully developed, in order to insure that the development will be orderly. . . .
“5. One well completed in said formation can adequately and efficiently drain 640 acres without causing waste. In accordance therewith, the basic acreage unit to be used in the proration formula hereinafter prescribed shall be 640 acres.
“7. All acreage attributable to a well for allowable purposes must be situated within the governmental section in which the well itself is located or must be contiguous and adjoining and must form a common boundary, other than a point, with that acreage in the governmental section on which the well is located.”
On September 5, 1962, the above order was amended to alter well spacing requirements and acreage attribution requirements. The amendments provided, in relevant part:
“To be considered as attributable to a well, the acreage shall be contiguous or adjoining, with the well located as nearly as practicable in the center thereof, and in no event nearer than 1,250 feet from any boundary line of the unit if a full 640 acres is to be attributed thereto. Any well drilled nearer than 1,250 feet to any unit boundary shall have its attributable acreage determined by establishing an acreage attribution unit with its width defined as being twice the distance from the well to the nearest unit boundary line, and the length not to exceed twice the width.
“Exceptions to the contiguous or adjoining acreage provisions may be granted whenever the Commission finds:
“C. 1. That the granting of such exception is necessary to prevent waste or to protect correlative rights; and
2. That a reasonable attempt has been made to include the acreage sought to be attributed in contiguous units; and
3. All acreage concerned is proven to be reasonably comparable in the Council Grove pay formation.
“All acreage attributed to a well must be proven to be productive of gas by competent evidence. Provided further the Commission may, either on complaint filed, or upon its own motion after notice and hearing, exclude any acreage from inclusion in the unit which in its judgment, based on such evidence, is not productive and should not be considered as proven acreage.”
All parties agree that the Commission is without authority to order compulsory unitization under the provisions of Article 7 of Chapter 55 above cited. This is in accord with Republic Natural Gas Co. v. Baker, 197 F.2d 647 (10th Cir. 1952). Subsequent to the Republic case, the Kansas Unitization Act (K.S.A. 55-1301 et seq.) was enacted, which permits compulsory unitization under certain designated circumstances. The application before us was not filed pursuant to said act and neither the parties nor the Commission seek to make the application an Article 13 proceeding. This appeal involves the powers of the Commission under Article 7 of Chapter 55.
Colorado Interstate Gas Co. v. State Corporation Comm., 192 Kan. 1, 386 P.2d 266 (1963), cert. denied 379 U.S. 131 (1964), contains an excellent discussion of the role of the Commission, including, inter alia:
“The administration of the law with respect to the production and conservation of natural gas is classified in that recognized area of regulation which necessitates the authority to exercise a considerable degree of discretion. The legislature delegated that authority to the Commission and with great latitude for the exercise of discretion through the promulgation of rules, regulations, orders, and decisions. In recognition of that authority, in providing for judicial review of the Commission’s actions, it specifically limited the authority of the reviewing court by providing that:
. . . The authority of the court shall be limited to a judgment either affirming or setting aside in whole or in part the rule, regulation, order or decision of the commission. . . .’ (G.S. 1949, 55-606.)” p. 14.
“The Commission has three responsibilities under the Gas Conservation Statute. It must first of all prevent waste of the natural resource. It must allow sufficient production to meet the market demand if such can be done without waste. It must protect correlative rights.
“In a gas field such as the Kansas-Hugoton where five major companies are taking gas through separate pipelines not connected to the same wells, the responsibilities placed upon the Commission will clash. If the market demand cannot be supplied without waste, or if correlative rights cannot be protected without waste, or if correlative rights cannot be protected without unduly restricting production needed for the market demand, one of the three, waste, market demand, or correlative rights, must suffer. The dominate purpose of the Gas Conservation Statute is to prevent waste. (Kansas-Nebraska Natural Gas Co. v. State Corporation Commission, 169 Kan. 722, 222 P.2d 704.)
“The Commission cannot require or guarantee that each well owner will produce and sell his entire allowable. The Commission is required to afford each owner the ‘right or opportunity’ to produce his share. As far as the Commission’s duty under the basic order goes, it is fulfilled when each owner is legally ‘free to produce’ and not denied the ‘right or opportunity’ to produce his allowable.
“The Commission could not be required to shut in an entire gas field to protect correlative rights where some of the producers desired to cease production and hold a gas field for a reserve. The Commission could not be required to unduly restrict production in a gas field because some producers desired to deplete the gas at a very low rate regardless of the reason.
“When waste, market demand, and correlative rights are in conflict the Commission must determine which is to be given preference. If the decision of the Commission is supported by evidence, the courts cannot interfere.” pp. 24-25.
Mobil’s contentions may be summarized as follows:
1. The inclusion of the 4/7 interest in the unit is not forced unitization of the 3/7 interest;
2. By considering the possible effect of the inclusion of the 4/7 interest on the excluded 3/7 interest, the Commission was exceeding its jurisdiction and invading the province of the courts;
3. The decision of the Commission is directly contrary to the theory upon which the Basic Proration Order for the Panoma Council Grove Gas Field, as amended, is premised; and
4. The Commission’s order results in the violation of the correlative rights of the 4/7 owners and constitutes waste.
The contentions of the intervenors on appeal may be summarized as follows:
1. The Commission was correct in determining that it lacked jurisdiction to include 91 acres of the 160-acre tract in dispute in the proposed unit;
2. K.S.A. 55-705b requires any application for an allowable to specify the “location of the well and the description of the acreage attributable thereto, the common source of supply . . . .” The acreage requirements in said statute refer to surface acres rather than mineral acres. Intervenors further contend this interpretation is necessary by virtue of the well spacing provisions;
3. If the Commission had approved the application in toto, the result would be, for all practical purposes, a legal partition of the disputed tract; and
4. The Commission properly considered the possible effect of its order in determining it lacked jurisdiction over the 4/7 undivided interest.
The contentions of the Commission are expressed in previously quoted sections from its orders and brief.
At first blush the Commission’s order appears to be a rather logical determination. On closer scrutiny, however, serious questions are raised as to its propriety. We note the following:
1. The application was for assignment of an allowable at an appropriate time and for a noncontiguous acreage attribution exception. Interestingly, the objections to the proposed unit are wholly unrelated to the fact the proposed unit is noncontiguous. Likewise, there is no complaint that the proposed allowable would be unfair. Mobil was not seeking a full 640-acre allowable on a 571-acre unit. The allowable would be based on the actual size of the unit. This would, theoretically at least, leave the intervenors’ 3/7 interests in 160 acres in the Panoma Council Grove Gas Field undisturbed.
2. The whole theory of gas production involves a number of fictions which were created out of necessity. The Panoma Council Grove Gas Field is a vast pool, the exact perimeters of which are unknown. Unlike solid minerals, gas moves. What underlies one tract moves to other tracts and of course may be withdrawn by wells on other tracts. The Commission has determined that one well can drain 640 acres. Through elaborate regulations some order is sought to be made out of what could be a highly chaotic situation. These regulations are aimed at preventing waste and the unfair or inequitable taking of gas from the pool. See Bennett v. Corporation Commission, 157 Kan. 589.
3. The intervenors contend they own an undivided interest in every molecule of gas under the entire 160-acre tract, and therefore the Commission does not have jurisdiction over any of the tract absent consent of all owners of the mineral interest. There is a producing well, owned by Anadarko and located on the quarter section immediately west of the disputed tract, which presumably is draining the disputed tract. The revised proration order concludes one well will drain 640 acres. There is no evidence as to whether or not the proposed well (G. W. Shell Unit No. 1), from its location on Section 29, will be draining gas from under the disputed tract, notwithstanding the Commission’s statements inferring that it would be draining the disputed tract.
4. Under the common law rule of waste, a cotenant could not remove minerals from land concurrently owned without the con sent of the concurrent landowner. However, Kansas has joined the present majority view that a concurrent owner has the power to separately lease and develop his own interest. 2 Williams and Meyers, Oil and Gas Law § 502 (1977); see Compton v. Gas Co., 75 Kan. 572, 89 Pac. 1039 (1907), and see generally 91 A.L.R. 205, 40 A.L.R. 1400.
5. The inclusion of the 4/7 interest would not be a bar to any action the owners of the 3/7 interest might bring against Mobil for failure to develop the lease under its implied covenants. In Rush v. King Oil Co., 220 Kan. 616, 627, 556 P.2d 431 (1976), this court stated:
“The purpose of the statute (K.S.A. 55-601, et seq.) is not to give the corporation commission the power to regulate development but rather to prevent waste and the unfair or inequitable taking of oil from any pool. (Bennett v. Corporation Commission, 157 Kan. 589, 142 P.2d 810, 150 A.L.R. 1140; Aylward Production Corp. v. Corporation Commission, 162 Kan. 428, 176 P.2d 861.) The orders of the commission in this regard do not preclude judicial review of a claim based on a breach of the implied covenants in an oil and gas lease.”
See also Renner v. Monsanto Chemical Co., 187 Kan. 158, 170, 354 P.2d 326 (1960), wherein this court considered the defendant’s assertion that valid orders of the State Corporation Commission issued pursuant to G.S. 1949, 55-601 et seq., afforded an impregnable defense to suits in the courts to enforce the obligation of further development under the implied covenants of an oil and gas lease. In rejecting the claimed defense, this court stated:
“The question has not previously been passed upon by this court and requires a consideration of our oil conservation statute (G.S. 1949, 55-601 et seq., as amended) and its effect on implied covenants of an oil and gas lease. As the issue is here presented, we are not concerned with whether a prudent operator would have drilled additional wells to fully develop the premises or to protect it against drainage since those questions were determined adversely to the defendants and the evidence more than amply supported the findings. The narrow question is whether, as a matter of law, the commission’s order attributing the full acreage of the leasehold to each producing well in 20-acre tracts constitutes a finding that the Renner wells would adequately and effectively extract the oil underlying the specific acreage attributed to each, thus relieving the defendants of their duty to further protect the premises against drainage, and precludes the district court from inquiring into the alleged violation of that implied covenant. We are not persuaded. A detailed analysis of the statute is unnecessary since that was done in Aylward Production Corp. v. Corporation Commission, 162 Kan. 428, 176 P.2d 861. Suffice it to say it was enacted to prevent physical or economic waste; to protect correlative rights of producers; to assure ratable taking within a common pool; to prevent discrimination among pools, and the legal device selected to accomplish those purposes is ‘proration.’ ”
6. The application does not seek an order from the Commission including a nonconsenting owner in the unit. That would be attempted forced unitization. Owners of the 3/7 interest have convinced the Commission to exclude the consenting owners of the 4/7 interest from the unit in the name of protecting the 3/7. Nowhere in statutes, regulations, or case law are “bargaining rights” a matter that the Commission is intended to regulate, supervise, or protect. To protect the bargaining rights of the 3/7, the right to produce is being denied the 4/7. Let us assume the 4/7 successfully proceeded with a partition action and, so partitioned, again sought to join the unit. The “bargaining rights” of the 3/7 would be allegedly jeopardized in precisely the same manner. The rather dog-in-the-manger position of the owners of the 3/7 interest is that if Mobil won’t pay them a premium for joining the unit then it is unfair to let the owners of the 4/7 interest into the unit. The Commission, by its order, permits the 3/7 to use the 4/7 as a tool to improve their bargaining position. The Commission is acting upon what might be referred to as equitable considerations when it is cloaked with no equitable jurisdiction.
We must conclude that the Commission erred in determining it did not have jurisdiction to consider the inclusion of the 4/7 interest on its merits.
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The opinion of the court was delivered by
Holmes, J.:
This appeal and cross-appeal involves the attempts of a divorced mother to obtain child support for the minor children of the dissolved marriage. Defendant/appellant and cross-appellee, Floyd Guernsey (Floyd), appeals from an order of the Wyandotte District Court determining and ordering the payment of current and future child support for his two minor children. The plaintiff/appellee and cross-appellant, Mary Jane Guernsey Keller (Mary Jane), is the former wife of Floyd and the mother of his two minor children. She cross-appeals from an order of the court denying her claim for a lump sum judgment for past due unpaid child support allegedly owed under an order of the Family Court of New York.
The facts are not in dispute. Floyd and Mary Jane were residents of and married in New York. Two children were born to Mary Jane during the marriage: Floyd Tracy, born September 20, 1965, and Patrick Arthur, born November 14, 1966. Floyd does not deny that he is the father of the two children or that they were born in wedlock. Mary Jane filed an action in the Family Court of Oswego County, New York, on December 12, 1967, for support under the New York Family Court Act. On February 27, 1968, an order was entered by the Family Court directing Floyd to pay $25.00 per week beginning March 1, 1968, for the support of Mary Jane and the two children. The money was ordered paid to the Commissioner of Oswego County Social Services as reimbursement for assistance being provided to Mary Jane. Floyd failed to comply with the order and on April 19, 1968, was sentenced to. six months in the Oswego County jail. It appears he served the sentence. Upon his release, Floyd paid support sporadically until sometime in 1970 when he left New York and moved to Kansas. Following Floyd’s departure, Mary Jane filed suit in the Supreme Court of New York for a divorce which was ultimately granted April 7, 1972. Service had been obtained by publication. Mary Jane was granted custody of the two minor children and the divorce decree orders “[t]hat all future questions of support of said children and alimony for the plaintiff shall be referred to the appropriate Family Court of the State of New York having jurisdiction over such matters.” Nothing further seems to have happened until 1976.
On August 10, 1976, Mary Jane filed an action in the Family Court of Oswego County, New York, under the Uniform Reciprocal Enforcement of Support Act. Floyd was served in Wyandotte County on August 30, 1976; however, nothing further transpired and on January 21, 1977, the action was dismissed by the court in New York because Mary Jane was no longer residing in that jurisdiction, having moved to North Carolina. The case was then dismissed in Wyandotte County in March, 1977.
On June 13,1977, this action was filed by Mary Jane seeking (1) a judgment for at least $10,000 (later alleged to be $11,050.00) for unpaid past due child support accrued under the New York Family Court order of February 27,1968, and (2) an order for the future support of the two minor children. Personal service was obtained on Floyd. On August 2,1977, the court ordered Floyd to pay the sum of $20.00 per week per child for child support which was raised by a subsequent order to $50.00 per week for each child effective November 4, 1977. The case was finally tried on February 24, 1978. On June 7, 1978, after receiving briefs from the parties, the court ruled (1) that under the laws of the State of New York no valid support judgment was in effect which could be enforced in Kansas; (2) that the support orders of the Wyan dotte County court were valid and enforceable against Floyd; and (3) future support beginning June 15, 1978, was fixed at the sum of $50.00 per week for the support of both children. Both parties have appealed.
We will first address the cross-appeal of Mary Jane. She has appealed from the denial of a judgment for past due support based upon the February, 1968, order of the Family Court of New York. She contends that the 1968 order created an ongoing obligation for Floyd to pay support and is entitled to be enforced in Kansas under the full faith and credit clause, Article IV, Sec. 1, of the United States Constitution.
Article IV, Sec. 1, provides:
“Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.”
In the recent case of Hicks v. Hefner, 210 Kan. 79, 499 P.2d 1147 (1972), this court was faced with a similar set of circumstances. The plaintiff Barbra Hicks brought an action in Ells-worth District Court to recover past due child support payments from her ex-husband, Andrew Hefner, based upon an order of the district court of Jackson County, Texas. At the time of the divorce both parties were residents of Texas. Subsequently Barbra moved to New Mexico and Andrew moved to Ellsworth County, Kansas. On the matter of granting full faith and credit under the Constitution, we stated:
“In the application of the foregoing [Article IV, Sec. 1] by state courts, the general rule is that a judgment rendered by a court of one state is entitled, in the courts of another state, to recognition, force or effect to the same extent and with as broad a scope as it has by law or usage in the courts of the state where the judgment was rendered. On the other hand, no greater effect need be given to any judgment of a court of one state than is given it in the state where rendered. (47 Am. Jur. 2d, Judgments,§ 1218, pp. 224-226; Restatement of the Law 2d, Conflict of Laws, 2d, Judgments,§ 109, p. 322.) Kansas adheres to the foregoing. (Smolinsky v. Federal Reserve Life Ins. Co., 126 Kan. 506, 268 Pac. 830; Robinson v. Railway Co., 96 Kan. 137, 150 Pac. 523; and Bleakley v. Barclay, 75 Kan. 462, 89 Pac. 906.)” p. 82.
The court reviewed the Texas statutes and decisions and found that Texas child support payments do not become final judgments at the time they become past due but may be altered, changed or suspended by the Texas court as the facts, circumstances, and justice may require. Our court then stated:
“[A] Texas decree, awarding periodical child support payments, cannot be considered a final judgment when suit is brought thereon in a sister state such as in the case confronting us here, and this holds true regardless whether the payments dealt with are past due or prospective. It must be kept in mind, of course, that our consideration herein is limited to an action brought on a Texas decree as distinguished from a common law action for support or a proceeding instituted under the provisions of the Uniform Reciprocal Enforcement of Support Act, K.S.A. 1971 Supp. 23-451, et seq. It should be further noted that our holding here is based on Texas law which was presented to the trial court and to this court on appeal. Thus, any presumption that the Texas law was the same as that of Kansas is foreclosed.
“In the case at bar, the payments are not absolute or vested and to give the Texas decree the effect sought by Barbra would be to accord it force and effect far beyond that which it would receive in Texas. In our opinion, to permit the gaining of this end by the vehicle of full faith and credit is clearly beyond the contemplation of the constitutional mandate and the implementing direction of Congress.” Hicks v. Hefner, 210 Kan. at 84 and 86. (See also K.S.A. 60-1611.)
McKinney’s Consolidated Laws of New York; Domestic Relations Law, Sec. 244, provides:
Ҥ 244. Enforcement by execution of judgment or order in action for divorce, separation or annulment.
“Where the husband in an action for divorce, separation or annulment, or declaration of nullity of a void marriage, or a person other than the husband when an action for an annulment is maintained after the death of the husband, makes default in paying any sum of money as required by the judgment or order directing the payment thereof, the court in its discretion may make an order directing the entry of judgment for the amount of such arrears, or for such part thereof as justice requires having a regard to the circumstances of the respective parties, together with ten dollars costs and disbursements. The application for such order shall be upon such notice to the husband or other person as the court may direct. Such judgment may be enforced by execution or in any other manner provided by law for the collection of money judgments . . . provided that when a judgment for such arrears or any part thereof shall have been entered pursuant to this section, such judgment shall thereafter not be subject to modification under the discretionary power granted by this section; and after the entry of such judgment the judgment creditor shall not hereafter be entitled to collect by any form of remedy any greater portion of such arrears than that represented by the judgment so entered.” (Emphasis added.) i
The statute makes it abundantly clear that in New York past due child support payments do not automatically become judgments against the delinquent spouse. The person seeking a judgment in New York must apply to the court; the delinquent spouse is entitled to notice and the court “in its discretion may make an order directing the entry of judgment for the amount of such arrears, or for such part thereof as justice requires . . . It was conceded at argument before this court that no action has been taken in the New York courts to comply with the New York statute. Mary Jane would not be entitled to a judgment in New York without further proceedings under the laws of that state and as held in Hicks:
“No greater effect need be given by a court of the forum state to any judgment of a court of another state than is given to it in the state where the judgment was rendered.” Syl. ¶ 2.
“In view of the Texas statute, Vernon’s Texas Ann. Civil Statute, Art. 4639a giving a Texas court power to alter child support payments, the provisions for child support in a decree of a Texas District Court are subject to modification, are not final and are not, by reason of full faith and credit, a basis upon which a Kansas court may render a lump sum judgment for accrued past due payments.” Syl. ¶ 3.
We find no error in the trial court’s ruling denying Mary Jane a lump sum judgment for past due support under the New York order. In view of our finding it is not necessary to consider the other arguments on this point.
We now turn our attention to Floyd’s appeal. The district court found that it had jurisdiction to enter orders for the support of the minor children and we agree. Floyd contends the court had no such jurisdiction because of the provisions of K.S.A. 60-1610(a), (amended 1979), which provided in part:
“60-1610. Decree. A decree in an action under this article may include orders on the following matters:
(a) Care of minor children. The court shall make provisions for the custody, support and education of the minor children, and may modify or change any order in connection therewith at any time, and shall always have jurisdiction to make any such order to advance the welfare of a minor child if (i) the child is physically present in the county, or (ii) domicile of the child is in the state, or (in) the court has previously exercised jurisdiction to determine the custody or care of a child who was at such time domiciled in the state.”
It should be noted that the statute was amended in 1979 to provide that custody provisions may be made only when the court has jurisdiction under the uniform child custody jurisdiction act. (K.S.A. 1979 Supp. 38-1301 et seq.) As custody is not an issue, the 1979 amendment has no bearing on the case before the court.
It is appellant’s argument that the enactment of K.S.A. 60-1610(a) establishes the jurisdictional parameters of the district court in all matters pertaining to the support of minor children, including proceedings under the Uniform Reciprocal Enforcement of Support Act (K.S.A. 23-451 et seq.) Mary Jane argues the statute has no application and concedes that the requirements of 60-1610(a) have not been met. The children were not physically present in the county, the children were not domiciled in Kansas and the Wyandotte District Court had not previously exercised jurisdiction over the custody or care of the children. K.S.A. 60-1601 et seq., govern actions filed in Kansas for divorce, separate maintenance and annulment of marriage. Orders entered by the court under 60-1610 apply to “a decree in an action under this article . . . .” and subsection (a) of the statute mandates that in such an action the court shall make provisions for the support and education of the minor children. However, nothing in the act precludes an action under proper circumstances against a parent for support of minor children based upon the common law duty to support such children. The jurisdictional forum prescribed by 60-1610(a) applies when there are or have been proceedings under article 16 of chapter 60. We have also held it determined the jurisdictional forum for proceedings under the 1951 Uniform Reciprocal Enforcement of Support Act (K.S.A. 23-419 et seq., now repealed) when there had been prior proceedings under 60-1601 et seq. Wheeler v. Wheeler, 196 Kan. 697, 414 P.2d 1 (1966). Floyd relies heavily on Wheeler. In Wheeler the parties originally obtained a divorce in Shawnee District Court and custody of the minor child was awarded to the mother, Dorothy H. Wheeler. Several years later Dorothy, residing in California, brought an action for support under the uniform act against her former husband who had become a resident of Johnson County. In the action under 23-419 et seq., the Johnson District Court entered an order against the father and he appealed asserting that the court lacked jurisdiction. This court found that the original jurisdiction of the Shawnee court was continuing, that the Johnson District Court should have transferred the proceedings to Shawnee District Court and ordered the judgment reversed and remanded the case with directions to transfer the matter to Shawnee District Court for further proceedings. Wheeler did not decide jurisdiction in an action to enforce the common law duty of support and appellant’s attempted reliance upon it is misplaced. We are not called upon, and do not here decide whether the enactment of the 1970 uniform act and K.S.A. 23-460 modifies our holding in Wheeler.
The duty of a parent to provide for minor children is one now universally recognized and one which has long been the law in Kansas. In Grimes v. Grimes, 179 Kan. 340, 295 P.2d 646 (1956), this court said:
“The support of children, like their custody, is a matter of social concern. It is an obligation the father owes to the state as well as to his children. He has no right to permit them to become a public charge. (Separation Agreements and Ante-Nuptial Contracts, Part Two [Rev. Ed.], Lindey, page 257, § 15.)
“In Doughty v. Engler, 112 Kan. 583, 584, 211 Pac. 619, we said:
“ ‘By the great weight of judicial opinion in this country parents are under a legal duty, regardless of any statute, to maintain their legitimate minor children (20 R.C.L. 622), the obligation being sometimes spoken of as one under the common law and sometimes as a matter of natural right and justice, and often accepted as a matter of course without the assignment of any reason. Chancellor Kent says: “The wants and weaknesses of children render it necessary that some person maintain them, and the voice of nature has pointed out the parent as the most fit and proper person. The laws and customs of all nations have enforced this plain precept of universal law.” (2 Kent’s Commentaries *189.) Blackstone begins his discussion of the duties of parents to legitimate children thus:
“The duty of parents to provide for the maintenance of their children, is a principle of natural law; an obligation, says Puffendorf, laid on them not only by nature herself, but by their own proper act, in bringing them into the world; for they would be in the highest manner injurious to their issue, if they only gave their children life that they might afterwards see them perish. By begetting them therefore, they have entered into a voluntary obligation, to endeavor, as far as in them lies, that the life which they have bestowed shall be supported and preserved. And thus the children will have a perfect right of receiving maintenance from their parents.” (1 Blackstone’s Commentaries, 447.)’ ” p. 343.
Mary Jane has contended throughout these proceedings that her cause of action for future support for the children was based upon the common law duty of Floyd and was for the benefit of the children.
In Strecker v. Wilkinson, 220 Kan. 292, 298, 552 P.2d 979 (1976), we stated:
“Support of children, like their custody, is a matter of social concern. It is an obligation the father owes the state as well as his children. (Grimes v. Grimes, 179 Kan. 340, 295 P.2d 646.) The parental duty to provide for the support and maintenance of a child continues through the child’s minority, and the obligation to support may be enforced by an action at any time during the child’s minority.”
Floyd attacks the foregoing statement from Strecker by stating in his brief:
“The holding in the Strecker case, supra, is based upon the theory that if a father does not support his children, the state will be forced to provide said support under the doctrine of parens patriae. This theory does not apply to the case on appeal for the reason that the minor children of the appellant do not and have never lived in the State of Kansas and, therefore, are not beneficiaries of the support or aid which might be offered by the State of Kansas.” p. 6.
Such an argument is not only fallacious but fellifluous. To argue that a parent’s duty of support may depend upon which tsixpayers are burdened with the responsibility, absent such support, justifies no further comment by this court.
It is further contended that the enactment of 60-1610(a) and 23-451 provide the only means for enforcing a delinquent parent’s duty of support. K.S.A. 23-453 and 454 provide:
“The remedies herein provided are in addition to and not in substitution for any other remedies.”
“Duties of support arising under the law of this state, when applicable under section 7 [23-457], bind the obligor present in this state regardless of the presence or residence of the obligee.”
It is readily apparent that nothing in the uniform act was intended to replace any other remedy available to enforce the duty of support. See Thompson v. Kite, 214 Kan. 700, 522 P.2d 327 (1974).
Floyd also relies heavily on the custody case of Small v. Small, 195 Kan. 531, 407 P.2d 491 (1965), wherein the court approved the following language of Commissioner Hatcher:
“In a proceeding for child custody the subject matter or res is the child.
“It is a well established rule of this court that jurisdiction of a court to consider and give custody of a child to one parent or the other depends in principle upon the domicile of the child. (Tompkins v. Garlock, 189 Kan. 425, 370 P.2d 131; Hannon v. Hannon, 186 Kan. 231, 350 P.2d 26; Moloney v. Moloney, 163 Kan. 597, 185 P.2d 167; Kruse v. Kruse, 150 Kan. 946, 96 P.2d 849; Wear v. Wear, 130 Kan. 205, 285 Pac. 606.)
“The new code provides the only conditions under which the district court shall have jurisdiction to make provisions for the custody of a child as follows:
“‘. . . if (t) the child is physically present in the county, or (ii) domicile of the child is in the state, or (jit) the court has previously exercised jurisdiction to determine the custody or care of the child who was at such time domiciled in the state. . . ” p. 535.
It should be noted that Small involved a Kansas separate maintenance action and the question of custody, not the common law duty of support. For a court to determine a question of custody it is only logical that the court have some jurisdictional contact with the res of the action; that is the minor child or children. In the enforcement of the common law duty of support, the presence or absence of the child or its domicile is not a controlling factor. We do not consider the language or holding in Small to be determinative of the issue before this court which is solely the jurisdiction of the Wyandotte District Court to enforce a defaulting parent’s common law liability to contribute to the support of the children.
A parent’s duty of support may be enforced in civil proceedings in one or more of at least three ways. Depending upon the circumstances of the individual case, the proper remedy may be: (1) proceedings under 60-1610(a); (2) proceedings under 23-451 et seq.; or (3) an action to enforce the common law duty of support. In the case at bar, where there were no proceedings under 60-1601 et seq., Mary Jane was free to select either of the other two alternatives. Having once instituted proceedings in New York under the uniform act only to have them subsequently dismissed, she chose to proceed, on behalf of the children, to bring a separate action to enforce Floyd’s common law duty of support.
We have carefully considered all the authorities propounded by Floyd, most of which are custody cases involving questions of domicile, and do not find them controlling of the Single issue raised by his appeal. Failure to meet the criteria of K.S.A. 60-1610(a) did not deprive the trial court of jurisdiction to enforce the common law duty of parental support of the minor children.
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The opinion of the court was delivered by
Herd, J.:
This is an interlocutory appeal by the State of Kansas pursuant to K.S.A. 22-3603. Defendant, Joe F. Garner, is charged with driving while under the influence of intoxicating liquor (K.S.A. 1979 Supp. 8-1567); transporting an open container of intoxicating liquor (K.S.A. 41-804); and not having a valid driver’s license on his person (K.S.A. 8-244). The State appealed the order of the trial court suppressing the results of a breath test to determine the defendant’s blood alcohol level. The Court of Appeals reversed the trial court and found the defendant was not entitled to suppress the results of the breath test. State v. Garner, 3 Kan. App. 2d 697, 600 P.2d 1166 (1979). We granted review and affirm the Court of Appeals.
This case arose from the following facts. On May 6, 1978, at 12:55 p.m. Saline County deputy sheriff John D. Myers stopped a car driven by Joe F. Garner as it proceeded down Broadway in Salina. Myers had followed Gamer for about one and one-half blocks, observing the car weave from one side of the street to the other. After Myers stopped Garner he approached his car. Defendant remained seated and appeared to be asleep or dazed. Over one-half of one side of his face was bruised with black and blue coloration and there was a strong odor of intoxicating liquor about the defendant and his car. Myers arrested Garner, gave him the Miranda warning, and then attempted to have him perform the standard coordination tests. Defendant could not perform any of the three tests satisfactorily. Myers had to catch him to prevent him from falling during two of the tests. While awaiting the arrival of the wrecker, Myers asked Garner if he would submit to a breath test. The defendant readily consented and blew into the apparatus. The test disclosed he had a .30% content of alcohol in his blood. Defendant testified he remembered nothing about being stopped, arrested or questioned or the taking of the breath test. The trial court ruled the officer performed the breath test on the defendant without his free and voluntary consent and without a valid search warrant. The appeal followed.
The sole issue before us is whether the trial court erred in suppressing the results of the defendant’s breath test because defendant, an incapacitated driver, was physically unable to freely and voluntarily refuse the request.
K.S.A. 1977 Supp. 8-1001 was in effect at the time this case arose. In 1978, the statute was amended to exclude the testing of urine and saliva under the statute. In addition, the amendment added sections (b)(2) and (3) regarding persons authorized to withdraw the blood. L. 1978, ch. 36, § 1. Neither amendment affects the issues in this case; therefore the statute will be cited in its current form. K.S.A. 1979 Supp. 8-1001 provides as follows:
(a) “Any person who operates a motor vehicle upon a public highway in this state shall be deemed to have given consent to submit to a chemical test of breath or blood, for the purpose of determining the alcoholic content of his or her blood whenever he or she shall be arrested or otherwise taken into custody for any offense involving operating a motor vehicle under the influence of intoxicating liquor in violation of a state statute or a city ordinance and the arresting officer has reasonable grounds to believe that prior to arrest the person was driving under the influence of intoxicating liquor. The test shall be administered at the direction of the arresting officer.
(b) “If a law enforcement officer requests the arrested person to submit to a chemical test of blood, the withdrawal of blood at the direction of the officer may be performed only by: (1) a person licensed to practice medicine and surgery or a person acting under the supervision of any such licensed person, (2) a registered nurse or a licensed practical nurse, or (3) any qualified medical technician. No person authorized by this subsection to withdraw blood, nor any person assisting in the performance of a blood alcohol test or any hospital wherein such blood is withdrawn or tested that has been directed by any law enforcement officer to withdraw or test blood shall be liable in any civil or criminal action when such act is performed in a reasonable manner according to generally accepted medical practices in the community where performed. No law enforcement officer who is acting pursuant to this section shall be liable for such action in any civil or criminal proceeding involving such action.
(c) “If the person so arrested refuses a request to submit to a test of breath or blood, it shall not be given and the arresting officer shall make to the division of vehicles of the state department of revenue a sworn report of the refusal, stating that prior to the arrest the officer had reasonable grounds to believe that the person was driving under the influence of intoxicating liquor. Upon receipt of the report, the division immediately shall notify such person of his or her right to be heard on the issue of the reasonableness of the failure to submit to the test. If, within twenty (20) days after receipt of said notice, such person shall make written request for a hearing, the division shall hold a hearing within the time and in the manner prescribed by K.S.A. 8-255. Notice of the time, date and place of hearing shall be given to such person by restricted mail, as defined by K.S.A. 60-103, not less than five (5) days prior to the hearing. If a hearing is not requested or, after such hearing, if the division finds that such refusal was not reasonable, and after due consideration of the record of motor vehicle offenses of said person, the division may suspend the person’s license or permit to drive or nonresident operating privilege for a period of not to exceed one (1) year.”
K.S.A. 1979 Supp. 8-1001(a) provides for implied consent and section (c) provides that no test shall be given if the person so arrested refuses a request to submit. Do those provisions include an “unconscious or incapacitated driver?” The State argues the test result is admissible in the absence of the driver’s refusal, for whatever cause, even to the extent of being unconscious. The defendant argues the statute grants a right of refusal which is rendered meaningless when the driver is incapable of exercising his right and the evidence is inadmissible.
Many states have implied consent statutes, some of which have unconscious or incapacitated driver provisions, such as:
Ala. Code § 32-5-192(b)
Ariz. Rev. Stat. Ann. § 28-691(c)
Cal. Veh. Code § 13353(a) (West 1979 Supp.)
Del. Code Ann. tit. 21, § 2747 Fla. Stat. Ann. § 322-261(c) (West)
Hawaii Rev. Stat. § 286-154
111. Ann. Stat. ch. 95 V2, § ll-501(e) (1979 Supp.)
Iowa Code Ann. § 321B.5 (West)
Ky. Rev. Stat. § 186.565(2) (1978 Supp.)
La. Rev. Stat. Ann. § 32:661B (West 1979 Supp.)
Mont. Rev. Codes Ann. § 32-2142.1(b) (1977 Supp.)
Neb. Rev. Stat. § 39-669.10
Ohio Rev. Code Ann. § 4511.191 (Page 1979 Supp.)
Tenn. Code Ann. § 59-1045 (1979 Supp.)
Vt. Stat. Ann. tit. 23, § 1202(a)
Wis. Stat. Ann. § 343.305(1)
The following states, like Kansas, have implied consent statutes which do not provide for the unconscious driver:
Alaska Stat. §§ 28.35.031, 28.35.032, 28.35.033 and 28.35.034
Conn. Gen. Stat. §§ 14-227a, 14-227b
Idaho Code § 49-352 (1979 Supp.)
Ind. Code Ann. § 9-4-4.5-4 (Burns 1979 Supp.)
Me. Rev. Stat. Ann. tit. 29 § 1312 (See also 1979-1980 Supp.)
Md. Transp. Code Ann. § 16-205.1 (1979 Supp.)
Mass. Ann. Laws ch. 90, § 24 (See also 1979 Supp.)
Mich. Stat. Ann. § 9.2325 et seq.
Minn. Stat. Ann. § 169.123 (West 1980 Supp.)
Okla. Stat. Ann. tit. 47, § 751 et seq. (West 1979 Supp.)
Let us examine the decisions from states with implied consent statutes similar to our own. In State v. Wood, 576 P.2d 1181, 1183 (Okla. Crim. 1978), the Oklahoma court construed its implied consent statute to mean:
“[A] person driving on the public roads gives his implied consent to a blood test in the event that he is rendered unconscious as a result of an automobile collision, and the police have probable cause to believe that he was driving while intoxicated.”
The Oklahoma court found the person whose blood or breath is taken while unconscious must be afforded the right to revoke the consent upon regaining consciousness. The Oklahoma court treated the refusal provision as a “right,” qualifying the implied consent provision of the statute.
In State v. Towry, 26 Conn. Supp. 35, 210 A.2d 455 (1965), the Connecticut Supreme Court held the implied consent statute did not specifically authorize the taking of blood from an unconscious driver; therefore, the State was required to prove the defendant consented to the test in order for the results to be admissible.
The Idaho Supreme Court reached yet another result in Mills v. Swanson, 93 Idaho 279, 280, 460 P.2d 704 (1969), wherein the court stated:
“The principal issue in this case is whether under these facts silence in response to a request to submit to a chemical test of the blood constitutes as a matter of law, a withdrawal of the statutorily granted consent to such test, thereby warranting suspension of a driver’s license pursuant to I.C. § 49-352.
“This court in the case of State v. Bock, 80 Idaho 296, 308, 328 P.2d 1065, 1072 (1958), said:
‘By operating a motor vehicle in this state the defendant is “deemed to have given his consent to a chemical test.” The only way he can withdraw that consent is to expressly refuse the test. So under our law if he neither refuses nor consents, expressly, the test may be made.’
“In the case at bar, the respondent did not at any time expressly refuse to take the test. Expressly means in direct or unmistakable terms.”
The court went on to hold that the respondent’s silence did not constitute an express refusal to take the test.
The foregoing cases illustrate a variety of interpretations courts have taken under statutes similar to ours. Subject to constitutional restraints, we are free to adopt the position we deem most appropriate to serve the public interest.
Let us now turn briefly to the constitutional questions raised by this case. In Breithaupt v. Abram, 352 U.S. 432, 1 L.Ed.2d 448, 77 S.Ct. 408 (1957), the court held an extraction of blood made by a physician in a hospital environment was not a violation of due process. Breithaupt distinguished the earlier case of Rochin v. California, 342 U.S. 165, 96 L.Ed. 183,72 S.Ct. 205 (1952), which held the forcible use of a stomach pump was so unreasonable as to constitute a due process violation. In Schmerber v. California, 384 U.S. 757, 16 L.Ed.2d 908, 86 S.Ct. 1826 (1966), the court was confronted with the constitutionality of the forced withdrawal of a blood sample by a physician from an unwilling defendant under arrest, done at a hospital under police direction. The court affirmed its holding in Breithaupt regarding the due process claim and found such a taking did not violate the privilege against self-incrimination or the right to counsel. The court further held a compulsory blood test directed by a state officer and performed upon the defendant after his arrest for drunken driving did not violate his right under the Fourth and Fourteenth Amendments to be free of unreasonable searches and seizures. The court held a warrantless search in this instance is justified where the delay necessary to obtain a warrant threatens loss of the evidence. Search and seizure implications with the taking of blood samples pursuant to Schmerber and the later case of United States v. Dionisio, 410 U.S. 1, 35 L.Ed.2d 67, 93 S.Ct. 764 (1973), were discussed by this court in State v. Brunner, 211 Kan. 596, 507 P.2d 233 (1973).
It is argued by appellee that K.S.A. 1979 Supp. 8-1001 grants to an accused a statutory right of refusal and since Garner was incapable of intelligently, knowingly and willingly exercising his right, the evidence so illegally obtained was properly suppressed. We do not agree.
It is well accepted that the operation of a motor vehicle on the public highways is a privilege, and not a right, subject to reasonable regulation under state police power in the interest of public safety and welfare. Lee v. State, 187 Kan. 566, 570, 358 P.2d 765 (1961); 7 Am. Jur. 2d, Automobiles and Highway Traffic § 6, p. 601. K.S.A. 1979 Supp. 8-1001, enacted to combat the increasing problem of drunken driving, provides for implied consent to a chemical test of breath or blood for the purpose of determining the intoxication level of one arrested for drunken driving. As this court stated in Lee v. State, 187 Kan. at 571:
“Chemical tests eliminate mistakes from objective observation alone, and they disclose the truth when a driver claims that he has drunk only a little and could not be intoxicated. They protect the person who has not been drinking to excess but has an accident and has the odor of alcohol on his breath. They save a person from a drunken driving charge when his conduct creates the appearance of intoxication but who actually is suffering from other causes over which he has no control.”
The objectives of the statute are necessary and proper within the police power of the state. After the statute gives implied consent, it provides “if the person so arrested refuses a request to submit to a test of breath or blood, it shall not be given . . . .” What effect does this statute giving implied consent with right of refusal have on an unconscious driver? We have seen the statute is more restrictive than the constitution. The statute requires an accused be given the right to refuse the test and states the test shall not be given if refused. The constitution permits the taking of a blood or breath test as an incident to arrest, regardless of refusal under the conditions discussed above. If the unconscious driver, who is not mentioned in K.S.A. 1979 Supp. 8-1001, is exempt from the statute, then the evidence is clearly not rendered constitutionally inadmissible.
We find, however, notwithstanding the absence of constitutional inhibitions, the evidence is admissible pursuant to the statute itself. K.S.A. 1979 Supp. 8-1001 provides the operator of a vehicle on the highway is deemed to have consented to the blood or breath test for the privilege of driving. We find the unconscious driver is included in this classification and has consented to the test. The provision in 8-1001(c) permitting an operator to refuse is not a right of refusal, but was included in the statute as a means to avoid the violence which would often attend forcible tests upon a rebellious drunk, and the operator may withdraw that consent by expressly refusing the test. If he fails to expressly refuse, the consent remains in force and the test may be made. See Mills v. Swanson, 93 Idaho 279. To hold otherwise would permit the worst offender, the passed-out drunk, to escape the provision of the statute by his own voluntary act.
In the case at bar, Garner did not expressly refuse to take the test. The test was, therefore, properly taken and the results are admissible. The judgment of the trial court is reversed and the judgment of the Court of Appeals is affirmed. | [
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The opinion of the court was delivered by
Herd, J.:
This is an original action in mandamus brought by petitioner Yvonne Nunn against respondents Judge Robert Morrison, the Kansas Department of Social and Rehabilitation Ser vices, Kathy Aring, Jose Hernandez, Lorenda Hernandez, Nora Hernandez and Vern Miller. She seeks an order compelling Judge Morrison to allow her access to the “social file” maintained in the juvenile court records in the district court below for purposes of the deprived child proceeding involving her children.
The facts of this case are undisputed. Petitioner Yvonne Nunn, a resident of Wichita, is the natural mother of Lorenda and Nora Hernandez. Lorenda and Nora are the subjects of a deprived child proceeding currently pending in the district court of Sedgwick County, Kansas, Eighteenth Judicial District, Juvenile Department, captioned “In the Interest of Lorenda Hernandez and Nora Lynn Hernandez.” Yvonne Nunn was served with a petition in the action alleging she knew of certain allegedly abusive conduct committed against the children by her now estranged husband Donald Nunn. The petition alleged she had failed to protect the children from such abuse. She, Donald Nunn and the children’s natural father Jose Hernandez were summoned to appear at the proceeding.
On December 3, 1979, Judge Morrison considered petitioner’s motion to inspect the juvenile court file commonly referred to as the “social file.” The social file in the juvenile case, kept separate from official court records, contains various psychological reports, evaluations made by social workers, police reports, and other correspondence regarding the two children. At the hearing, Judge Morrison reviewed the file and made a ruling generally denying petitioner access with the exception of certain portions of the file. This original action followed that denial of access. The parties have presented two issues. The first is whether mandamus is an appropriate remedy in this case.
K.S.A. 60-801 provides:
“Mandamus is a proceeding to compel some inferior court, tribunal, board, or some corporation or person to perform a specified duty, which duty results from the office, trust, or official station of the party to whom the order is directed, or from operation of law.”
In Cropp v. Woleslagel, 207 Kan. 627, 628, 485 P.2d 1271 (1971), this court stated:
“[Mjandamus will be invoked only when an order of the trial court denies a litigant a right or privilege which exists as a matter of law and there is no remedy by appeal.”
Petitioner requests this court to compel the trial court to allow her access to certain evidence which has been revealed to the other party to the action. With respect to the use of mandamus as a discovery tool, we are referred to Muck, Administratrix v. Claflin, 197 Kan. 594, 419 P.2d 1017 (1966). In that case, this court directed a trial court to set aside its order compelling the plaintiff to disclose certain information on a set of interrogatories regarding limits of liability insurance. We discussed at length the purpose of discovery and its importance to the preparation of a case. Mandamus was granted, but not on the grounds of easing discovery at trial. We adhered to the established rule that mandamus will be invoked only when a right exists and there is no remedy by appeal. In that case, the court held that the party did not have a remedy as a matter of law, such as the right to appeal, because if she were forced to reveal the information sought, such a disclosure would be irreparably fixed in the mind of any interested party and appeal would not correct that error. Indeed, in Cropp v. Woleslagel, 207 Kan. at 628, we discouraged the use of mandamus as a remedy for adverse discovery rulings, stating:
“This court does not propose to undertake the task of monitoring trial courts at the pretrial or discovery stage of litigation or of rendering advisory opinions whenever the propriety of pretrial inquiry arises.”
Notwithstanding these rulings, we hold mandamus is a proper remedy in this case. Here, petitioner is a party to a deprived child proceeding in which custody of her children are at issue. A good part of the proceeding originated pursuant to the reports and evaluations contained within the social file in question. It was also shown that petitioner’s adversaries were allowed to fully examine and photocopy the social file, while she was denied an opportunity to examine the entire file. In Mobil Oil Corporation v. McHenry, 200 Kan. 211, 243, 436 P.2d 982 (1968), this court stated:
“It has been said that mandamus will not lie at the instance of a private citizen to compel the performance of a public duty; that such a suit must be brought in the name of the state, and the County Attorney and the Attorney General are the officers authorized to use the name of the state in legal proceedings to enforce the performance of public duties. Where, however, an individual shows an injury or interest specific and peculiar to himself, and not one that he shares with the community in general, the remedy of mandamus and the other extraordinary remedies are available.” [Citations omitted.]
“Whether or not a private individual has brought himself within the narrow limits of the well-established rule must be determined from the particular facts of each individual case.”
Here, we are informed by counsel, Judge Morrison has ceased to allow parents in deprived child proceedings to view the social file received by the juvenile court. It is clear petitioner suffers a specific injury peculiar to her status as parent. In addition, we find her remedy at law, that of appeal, is severely limited as a great deal of the case depends upon the contents of the social file, to which her adversaries have access. We find there is a clear duty on the part of Judge Morrison to furnish petitioner with access to the social file. Mandamus is, therefore, an appropriate remedy in this instance. By our ruling, we do-not intend to open all questions of discovery to piecemeal review. We find, however, that the facts in this case warrant the granting of petitioner’s request for mandamus.
The second issue raised by the parties is whether petitioner has been deprived of a legal right which entitles her to an order in mandamus compelling Judge Morrison to allow plaintiff access to the social file.
The statute in question in this case is K.S.A. 1979 Supp. 38-805, which states:
“(a) The record in the district court for proceedings pursuant to the Kansas juvenile code shall consist of the petition, process and the service thereof, orders and writs, and reports and evaluations received or considered by the court. Such documents shall be recorded and kept by the court, separate from other records of the court.
“(b) All records, files or other information maintained, obtained or prepared by any officer or employee of the district court in connection with proceedings under the Kansas juvenile code shall be privileged and shall not be disclosed, directly or indirectly, to anyone except:
“(1) A judge of the district court and members of the staff of the court designated by a judge of the district court;
“(2) parties to the proceeding and their counsel;
“(3) a public or private agency or institution providing supervision or having custody of the child under court order;
“(4) to any other person when authorized by a judge of the district court, subject to any conditions imposed by the judge; or .
“(5) a court in which such person is convicted of a criminal offense for the purpose of a presentence report or other dispositional proceeding, officers of penal institutions and other penal facilities to which such person is committed or a parole board considering such person’s parole or discharge or exercising supervision over such person.
“(c) In order to properly advise the three branches of government on the operation of the juvenile justice system, each district court shall furnish the judicial administrator such information regarding juveniles coming to the atten tion of the court pursuant to the Kansas juvenile code as is determined necessary by the secretary of social and rehabilitation services and the director of the governor’s committee on criminal administration, on forms approved by the judicial administrator.”
Plaintiff contends she is a party within the meaning of K.S.A. 1979 Supp. 38-805(h)(2) and the trial court is required to disclose the records to her. Respondents argue the parties to the proceeding are only those named in the caption of the case, i.e., “In the Interest of Lorenda Hernandez and Nora Lynn Hernandez.” That logic would appear to exclude anyone who is not Lorenda or Nora Lynn, including members of the district attorney’s office, who were allowed to view the file.
It is clear to this court petitioner is a party to the deprived child proceeding. She was served with a petition and summons in the action. If she had failed to appear, without reasonable cause, she could have been in contempt of court. K.S.A. 1979 Supp. 38-810a(e). Numerous other statutes throughout the juvenile code further illustrate her party status. A parent may not be deprived of his or her parental rights in a deprived child proceeding unless the parent is represented by counsel and unless the court may enter a child custody determination pursuant to K.S.A. 1978 Supp. 38-1303. K.S.A. 1979 Supp. 38-820. A natural parent is authorized to transfer the deprived child proceedings “to the court of the county where the child is physically present or where the parent or parents reside.” K.S.A. 1979 Supp. 38-812. The trial court must summon and give notice of the time and place of the deprived child hearing to “the child and the parent, guardian or other person having legal custody of such child or if there be none then some relative or other interested person, if there be one.” K.S.A. 1979 Supp. 38-817(a). The parents have the right to appeal from any final order made on behalf of the child. Those persons having the right to appeal are termed “parties.” K.S.A. 1979 Supp. 38-834(b)(d)(é). The parents could be made liable for the costs of the care of the allegedly deprived child, prior to or during the pendency of the deprived child action. K.S.A. 1979 Supp. 38-828. The parent could also be liable for court costs and witness fees. K.S.A. 1979 Supp. 38-817(h). Finally, we note with approval the following statement from 47 Am. Jur. 2d, Juvenile Courts, Etc. § 37, p. 1014:
“The word ‘party,’ as generally used in connection with persons who are involved in juvenile court proceedings, does not ordinarily connote an adversary party such as the plaintiff or defendant in proceedings in other courts. It has been said that a person having custody of the juvenile, or a parent or guardian of such child, is a party to proceedings in juvenile court in the sense that he or she has the right to appear and give testimony, to be represented by counsel, to call witnesses, and to cross-examine witnesses.”
From the foregoing, we conclude it is clear petitioner is a party to the proceeding.
We must determine whether the language in K.S.A. 1979 Supp. 38-805 is mandatory or discretionary. A review of the statute’s legislative history will reveal the answer.
K.S.A. 38-805, originally enacted in 1957, provided as follows:
“(a) The record in the juvenile court shall consist of the petition, process and the service thereof, orders and writs, and such documents shall be recorded in books kept by the juvenile court for such purpose.
“(b) The official records of the juvenile court shall be open to inspection only by consent of the juvenile court judge, or upon order of a judge of the district court, or upon order of the supreme court.
“(c) All information obtained and records prepared by any employee of the juvenile court shall be privileged, and shall not be disclosed, directly or indirectly, to anyone other than the juvenile court judge or others entitled under this act to receive such information, unless and until otherwise ordered by such judge.”
The statute was amended in 1976. L. 1976, ch. 207, § 5. The changes generally reflected court unification and also substituted the words “district court” for “juvenile court.” The 1978 amendments took away the total discretion of the judge regarding inspection of court records pertaining to juveniles and enacted what are now sections (b), (1) through (5). L. 1978, ch. 158, § 2. The 1979 amendments added what is now section (c), which requires the district court to furnish certain information regarding juveniles to the judicial administrator. L. 1979, ch. 124, § 1.
In Shawnee Township Fire District v. Morgan, 221 Kan. 271, 278, 559 P.2d 1141 (1977), this court stated:
“[I]t is a fundamental rule of law that a change in phraseology or the deletion of a phrase in amending or revising a statute raises a presumption that a change of meaning was also intended . . . .”
We find the 1978 amendments reflect a legislative intent to depart from the former statute granting a trial court total discretion. The current statute lists certain parties who are to have access to the social file. This conclusion is also clear from a reading of the statute itself. K.S.A. 1979 Supp. 38-305(¿)(4) provides the trial court may, in its discretion, allow certain persons to have access to the file. A common-sense interpretation of the statute would not find provisions (1), (2), (3) and (5) discretionary as well, when the legislature clearly enacted a specific provision for trial court discretion.
The final aspect of the operation of this statute must include a reconciliation of the possible conflict between K.S.A. 1979 Supp. 38-805 and K.S.A. 1979 Supp. 38-723, a provision of the child protection act, which states:
“All records and reports concerning child abuse and neglect filed with the department of social and rehabilitation services or a district court are confidential and shall not be disclosed, and it shall be a violation of the Kansas child protection act for any person, association, firm, corporation or other agency willfully or knowingly to permit or encourage the unauthorized dissemination of the contents of such records and reports except as otherwise provided by the Kansas child protection act or under the following conditions: (a) Upon the order of any court or record after a determination by the court issuing the order that such records and reports are necessary for the conduct of proceedings before it and are otherwise admissible in evidence, except that such access shall be limited to in camera inspection unless the court determines that public disclosure of the information contained therein is necessary for the resolution of an issue then pending before it; and (b) the secretary of social and rehabilitation services or the judge of the court where the report is filed may authorize access to such records and reports to: (1) A person licensed to practice the healing arts who has before him or her a child whom he or she reasonably suspects may be abused or neglected; (2) an agency having the legal responsibility or authorization to care for, treat, or supervise a child who is the subject of a report or record; (3) a parent, guardian, or other person responsible for the welfare of a child named in a report or record, with protection for the identity of reporters and other appropriate persons; (4) a police or other law enforcement agency investigating a report of known or suspected child abuse or neglect; (5) an agency of another state charged with the responsibility of preventing or treating physical or mental abuse or neglect of children within that state, if the state of the agency requesting the information has standards of confidentiality as strict as or stricter than the requirements of the Kansas child protection act.”
The child protection act encompasses K.S.A. 1979 Supp. 38-716 through 724. The act is concerned with the reporting and investigating of child abuse. K.S.A. 1979 Supp. 38-723 relates to the confidentiality of reports and records concerning child abuse and neglect. Those records are not to be disclosed unless the court orders they are necessary for the proceeding before it, and then only an in camera inspection is allowed unless the court believes the report should be made public. The secretary of social and rehabilitation services or the judge may authorize access to the records and reports to certain persons listed in the statute. The conflict: Which court records and reports statute applies in a deprived child proceeding, defined in K.S.A. 1979 Supp. 38-802(g)(3), involving an abused child?
Well established rules of statutory construction were stated in American Fidelity Ins. Co. v. Employers Mut. Cas. Co., 3 Kan. App. 2d 245, 248, 593 P.2d 14 (1979):
“In construing a statute, legislative intent is to be determined by consideration of the entire act. The several provisions of an act, in pari materia, must be construed together with a view of reconciling and bringing them into workable harmony and giving effect to the entire statute if it is reasonably possible to do so. [Citation omitted.]
“. . . Statutes relating to the same subject, although enacted at different times, are in pari materia and should be construed together.”
The two sets of statutes, the juvenile code and the child protection act, do not operate totally independent of one another. Both acts deal with the general subject of proceedings involving juveniles and both statutes in question concern the related purpose of confidentiality of juvenile records. A significant tie between the acts further illustrating their lack of complete independence of one another is: If a person reported a possible case of child abuse, pursuant to K.S.A. 1979 Supp. 38-717, that person would be given immunity from any liability incurred “in any judicial proceeding resulting from such report.” K.S.A. 1979 Supp. 38-718. Such contemplation of participation in a judicial proceeding obviously takes into account the fact that the identity of the reporter would be revealed while he or she testified at trial. Additionally, several portions of the juvenile code are referred to in the child protection act. See K.S.A. 1979 Supp. 38-721, citing K.S.A. 1977 Supp. (now 1979 Supp.) 38-816 and 1979 Supp. 38-721a, citing 1977 Supp. (now 1979 Supp.) 38-815.
Notwithstanding the ties between the two acts, we find the strict provisions of the child protection act regarding records and reports cannot govern the determination of access to reports and records in an action brought pursuant to the juvenile code. Although the two acts have the ties discussed the purposes of the above two acts remain dissimilar. K.S.A. 1979 Supp. 38-716 reveals the purpose of the child protection act:
“It is the policy of this state to provide for the protection of children who have been subject to physical or mental abuse or neglect by encouraging the reporting of suspected child abuse and neglect, insuring the thorough and prompt investigation of these reports and providing preventive and rehabilitative services where appropriate to abused or neglected children and their families so that, if possible, the families can remain together without further threat to the children.” (Emphasis added.)
The purpose of the child protection act is also illustrated in the former title of the act, the “child abuse and neglect reporting act.” K.S.A. 1976 Supp. 38-724, amended in 1977. See L. 1977, ch. 149, §11. The juvenile code governs the procedure to be used in actions involving juveniles brought within its purview. The provisions of the code generally reflect a philosophy best expressed as follows:
“[F]irst, the child in trouble or danger needs care; second, there is to be no import of a criminal act; third, the proceeding is protective, not punitive; and fourth, incarceration is limited and carefully controlled.” Note, The Amended Kansas Juvenile Code: Can Parens Patriae Withstand Due Process? 18 Washburn L.J. 244, 245, (1979).
Respondents Morrison and the Kansas Department of Social and Rehabilitation Services express concern that the stated purpose of the child protection act would be thwarted if parents are given access to the social file in a juvenile proceeding arising from the reporting of child abuse, and the name of the reporter is revealed. They argue future reporters of such actions would be discouraged from speaking out for fear of reprisal. We believe the most logical interpretation of the two acts is as follows: Because the stated purpose of the child protection act is to encourage the reporting of child abuse and neglect, in order to encourage the reporting a certain amount of anonymity of the reporter must be retained. Therefore, during the investigation of the reported abuse, and until formal proceedings are initiated in a deprived child action pursuant to the juvenile code, the report that is filed with the trial court or the Kansas Department of Social and Rehabilitation Services is governed by the restrictions set forth in K.S.A. 1979 Supp. 38-723. After the report has been investigated, however, a valid claim of child abuse is found, and an action is begun under the Juvenile Code, it is proper to allow access to the report, filed in the social file, to the persons enumerated in K.S.A. 1979 Supp. 38-805(h). As stated earlier, petitioner herein clearly falls within the definition of a party to the action pursuant to K.S.A. 1979 Supp. 38-805(h)(2) and is entitled to view the social file.
Based upon the foregoing, we grant the petition for mandamus.
McFarland, J., dissents. | [
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The opinion of the court was delivered by
Fromme, J.:
This action arose between two insurance companies under the “Kansas automobile injury reparations act,” K.S.A. 1979 Supp. 40-3101 et seq. It was filed by Farmers Insurance Company, Inc. (Farmers), against Farm Bureau Mutual Insur anee Company, Inc. (Farm Bureau), to recover $1,540.00 which amount it paid to its insured as personal injury protection (PIP) benefits. See K.S.A. 1979 Supp. 40-3103(<7) for definition of PIP benefits.
Robert King was insured by Farmers. William Latham was insured by Farm Bureau. King was injured in a two-vehicle automobile accident on October 19, 1974. Latham was the owner-operator of the second car. Pursuant to the terms of the PIP endorsement to King’s policy, Farmers paid $1,540.00 to King for medical and wage benefits resulting from the accident with Latham. Farmers notified Latham’s liability carrier, Farm Bureau, that PIP benefits had been paid to King and that Farmers claimed a lien as a result of the payments pursuant to K.S.A. 40-3113, now K.S.A. 1979 Supp. 40-3113a.
King retained an attorney, Mr. Lloyd Alvey, to represent him in recovering on a claim against Latham based in tort arising from the accident on October 19, 1974. Attorney Alvey notified his client’s insurer, Farmers, that his client, King, had retained him to make a claim against Latham and Latham’s insurance carrier, Farm Bureau. Farmers instructed attorney Alvey that he had no authority to represent Farmers in collecting its claim for reimbursement of PIP benefits paid to King.
With the position of Farmers clearly in mind attorney Alvey made claim against Farm Bureau as the liability insurer of Latham. A settlement was agreed to between King and Farm Bureau. It was understood by Farm Bureau that King had no authority to settle the reimbursement claim for PIP benefits paid by Farmers. The settlement figure of $2,000.00 was understood by both parties not to be duplicative of PIP benefits. King executed a standard release in favor of Latham and received a draft for $2,000.00 issued by Farm Bureau on April 17, 1976. Farmers was not made a joint payee on the settlement draft as no amount for PIP benefit payments was included in the draft.
When the accident occurred on October 19, 1974, and the right to PIP benefits accrued, K.S.A. 40-3113 was in effect. The statute was still in effect when the $2,000.00 settlement was made between King and Farm Bureau on April 17, 1976. However, K.S.A. 40-3113 was repealed and K.S.A. 1979 Supp. 40-3113a became law on July 1, 1977. The present action was filed October 24, 1977.
The question as to which law applies confronts us. The answer is found in Nitchals v. Williams, 225 Kan. 285, 590 P.2d 582 (1979). In Nitchals it was held that paragraph (e) of K.S.A. 1979 Supp. 40-3113a regarding apportionment of attorney fees should be given retrospective application since it effected a procedural change. At pp. 291 and 292 of that opinion, however, it is said:
“It is clear that a statutory right of an insurance company to reimbursement for insurance benefits paid, where the insured recovers from a third party, is a substantive legal right. Insurance Co. v. Cosgrove, 85 Kan. 296, 116 Pac. 819 (1911), affirmed on rehearing 86 Kan. 374, 121 Pac. 488 (1912). Conceding that the right of reimbursement for PIP benefits paid provided in both the old and the new statute is substantive in nature, it becomes necessary to determine whether 40-3113a(e), which allows the apportionment of attorney fees between the PIP insurer and insured, is merely a change in an existing remedy or a statutory change which alters a vested substantive right.”
The questions raised herein with regard to reimbursement rights concern substantive rights existing prior to the effective date of the new statute. Therefore, the decision in this case must be governed by our former statute K.S.A. 40-3113. Our decision here will give but limited guidance for the future because the new statute contains several major changes which we will not consider here.
The facts of this case are not in dispute. After hearing evidence and considering the stipulations of counsel the trial court made findings on the record and entered a judgment in favor of plaintiff-Farmers for $1,540.00, the amount of PIP benefits paid its insured. The findings upon which the judgment rests are paraphrased by Farmers in its brief as follows:
“(1) The settlement between Mr. King (through Mr. Alvery) and Kansas Farm Bureau was over and above the PIP benefits which had been paid; this settlement was effectuated while a claim for PIP benefits existed between plaintiff-appellee Farmers and defendant-appellant Farm Bureau.
“(2) The plaintiff Farmers does not have a right of subrogation (or reimbursement) against its insured (Mr. King or attorney Alve?y) for the PIP benefits in question.
“(3) The release taken by Farm Bureau, on behalf of its insured (Mr. Latham) disturbs Farmers’ cause of action, or PIP claim, against Kansas Farm Bureau.
“(4) Farm Bureau is obligated under K.S.A. 40-3113(c) to indemnify Farmers for the loss Farmers suffered in the amount of the PIP benefits paid (to Mr. King).”
Defendant-Farm Bureau appeals from the judgment. It agrees with finding (1) above but disagrees with the conclusory findings (2), (3) and (4). The five points raised on appeal bear upon the positions of these two parties under the reimbursement provisions of K.S.A. 40-3113. We will first analyze the section in view of existing Kansas case law.
This section of the Kansas automobile reparations act is divided into five paragraphs identified by letters (a) through (e), dealing with insurers’ rights of reimbursement and indemnity. The section explains the rights, duties and liabilities of the respective parties after PIP benefits have been paid. It is well to keep in mind that personal injury protection insurance coverage provides first party insurance. The injured party looks to his own insurance company for payment of PIP benefits. Farm & City Ins. Co. v. American Standard Ins. Co., 220 Kan. 325, Syl. ¶ 1, 552 P.2d 1363 (1976).
Section (a) of the statute refers to rights of the PIP insurer after its insured has recovered damages by judgment or settlement upon the tort claim. The section provides that when ongoing PIP payments are being made to the insured and the insurer has recovered damages from the tortfeasor, the insurer may then subtract from further PIP payments coming due the amount of PIP payments which the insured has already recovered in damages. It further provides, if PIP benefits have already been received and the insured recovers duplicative benefits from the tortfeasor, that the insured shall repay to the insurer the PIP benefits he or she previously received under first party coverage. The section further provides: “The injured person’s insurer or insurers shall have a lien on such recovery to this extent.” In other words, K.S.A. 40-3113(a) provides that the insurer has a right to recover back from its insured any PIP payments paid by the insurer if and when the insured has recovered from a tortfeasor damages which include sums duplicative of the PIP payments. Easom v. Farmers Insurance Co., 221 Kan. 415, Syl. ¶ 4, 560 P.2d 117 (1977). The present action was not brought against the insured. It was brought to recover from the liability insurer of the tortfeasor. So section (a) is not of present concern.
Section (b) of the foregoing statute recognizes in the PIP insurer a right of reimbursement “if suffering loss from inability to collect such reimbursement out of a payment received by an injured person upon a tort claim.” In addition it provides if a tortfeasor, or the liability insurer of the tortfeasor, makes payment to the injured person without making such person and the PIP insurer joint payees on the payment draft, the PIP insurer is entitled to indemnity to the extent of any payment duplicative of PIP payments. In order to obtain such indemnity it must appear (1) the PIP insurer is suffering loss from inability to collect reimbursement from its insured, (2) the tortfeasor or the liability insurer had notice of the PIP insurer’s interest, and (3) the tortfeasor or the liability insurer with such notice made payment to the injured person without making the PIP insurer a joint payee on the settlement draft. No showing as required under (1) above was made by Farmers in this case.
Section (c) of the statute relates to the time schedule for bringing an action to recover on the tort resulting in the injuries. The injured person may bring the action under 40-3117 during the. first eighteen (18) months after the accident. If such an action is not filed the insurer of the injured person, after giving thirty (30) days’ written notice, has the right to bring a tort action “to recover the amount of the personal injury protection [PIP] benefits” paid to the injured person.
Section (d) of the statute recognizes arbitration between insurance companies as a permissible method of settling disputes.
Section (e), which is the final paragraph, provides that PIP benefits shall be deducted from any recovery received by an injured person under uninsured motorist coverage.
We turn to the first question raised. Appellant-Farm Bureau contends the cause of action was barred by the statute of limitations. A tort action is limited to two years from the time the action accrues under K.S.A. 60-513(a)(4). Under (b) of this statute the action accrues when the act giving rise to the cause of action (the car accident in this case) first causes substantial injury. This would be on October 19, 1974. Any tort action brought by either the injured person or his PIP insurer against the tortfeasor or the liability insurer pursuant to K.S.A. 40-3113(c) is limited by K.S.A. 60-513(c)(4) to two years from the date of the injuries. The injured person has priority during the first eighteen (18) months. After giving the required notice to the injured person the PIP insurer may bring an action to recover its PIP payments thereafter if the action is filed within two years after the injuries. However, in this case the two years expired October 19, 1976, and the present action was not filed until October 24, 1977. Obviously any tort action as contemplated in K.S.A. 40-3113(c) is barred.
The appellee-Farmers argues this is not a tort action. It argues the action was brought pursuant to K.S.A. 40-3113(fe), and that this paragraph creates a new statutory cause of action in favor of the PIP insurer against the liability insurer for failure to protect the PIP insurer by making it a joint payee on the settlement draft. Farmers contends the action is limited by K.S.A. 60-512(2) which states:
“The following actions shall be brought within three (3) years: ... (2) An action upon a liability created by a statute other than a penalty or forfeiture.”
We cannot agree. The liabilities of all parties grew out of the automobile accident. Farmers, as PIP insurer, had certain rights of reimbursement under this section of the act when it paid the PIP benefits to its insured, King. Under paragraph (a) a right to subtract from PIP payments to be made in the future is possible when the insured has settled with the tortfeasor. This does not apply in the present case. Paragraph (a) also recognizes that the PIP insurer has a lien on any recovery from a tortfeasor which its insured receives to the extent of the PIP benefits paid. Farmers made no attempt to enforce its lien on the amount its insured received from the tortfeasor’s insurer.
Paragraph (b) recognizes the PIP insurer’s right of reimbursement from the liability insurer when it fails to name joint payees on the settlement draft and has been put on prior notice of the PIP insurer’s claim.
The statutory provisions in K.S.A. 40-3113 for recoupment by the PIP insurer of PIP benefits paid to its insured were not meant to create some new statutory cause of action. The provisions are merely intended to recognize rights of subrogation and to assist the PIP insurer, through subrogation, to recover from the tortfeasor and the tortfeasor’s insurer. In addition it provides a lien against damages collected by the injured person which are duplicative of PIP benefits.
Subrogation may be based on contract. Also, it may be legal subrogation which arises by operation of law without regard to any contractual relationship. It may also be statutory in nature as in the present case or any combination of the three.
In the early case of Blitz v. Metzger, 119 Kan. 760, 767, 241 Pac. 259 (1925), this court said:
“Subrogation is a creature of equity invented to prevent a failure of justice, and is broad enough to include an instance in which one party is required to pay what is, between them, the debt of another. It does not depend upon contract nor the absence of contract, but is founded upon principles of natural justice. (New v. Smith, 94 Kan. 6, 16, 145 Pac. 880; Olson v. Peterson, 88 Kan. 350, 128 Pac. 191; Crippen v. Chappel, 35 Kan. 495, 11 Pac. 453.)”
See also United States Fidelity & Guaranty Co. v. First State Bank, 208 Kan. 738, Syl. ¶ 5, 494 P.2d 1149 (1972).
The insurer’s right of subrogation against third persons causing the loss paid by the insurer to the insured is derived from the insured alone. Consequently, the insurer can take nothing by subrogation but the rights of the insured, and is subrogated to only such rights as the insured possesses. The rights of the insurer against the wrongdoer cannot rise higher than the rights of the insured against such wrongdoer, since the insurer as subrogee, in contemplation of law, stands in the place of the insured and succeeds to whatever rights he may have in the matter. Therefore, any defense which a wrongdoer has against the insured, such as the statute of limitations, is good against the insurer subrogated to the rights of the insured. 44 Am. Jur. 2d, Insurance § 1821; Hartford Fire Ins. Co. v. Western Fire Ins. Co., 226 Kan. 197, 597 P.2d 622 (1979).
In Kirtland v. Tri-State Insurance Co., 220 Kan. 631, 556 P.2d 199 (1976), a claim regarding the statutes of limitations was made by reason of K.S.A. 66-1,128. A party had been injured by the insured motor carrier and a direct cause of action was recognized in tort against the insurer of the motor carrier by reason of this statute. In holding the two year statute, K.S.A. 60-513(a)(4), applied, rather than the three year statute, K.S.A. 60-512(2), the court pointed out:
“If plaintiff’s position is adopted by this court, she would have two years in which to sue the original tortfeasor and three years to sue his insurer. The insurer would be exposed to a greater period of liability than the original tortfeasor. It is the obligation of this court to interpret statutes to express the intent of the legislature [citation omitted], and we cannot believe the legislature intended to create such an anomaly. [Citation omitted.] Since the insurer by statute stands in the shoes of the insured, he can have no greater or lesser rights or obligations than the insured. [Citations omitted.]” 220 Kan. at 634.
The PIP insurer which has paid PIP benefits to its insured has rights of reimbursement and subrogation against the tortfeasor and his or her liability insurer under K.S.A. 40-3113. These rights recognized by statute are limited by the same two year statute of limitations which applies to an action against the tortfeasor, K.S.A. 60-513(a)(4). Since this disposes of the cause of action we will not examine the remaining points raised on appeal.
In the present case any action by Farmers to collect from the tortfeasor’s insurer Farm Bureau was barred by the two year statute of limitations and the trial court erred in failing to sustain defendant’s motion to dismiss the action prior to trial. The judgment for $1,540.00 in favor of Farmers Insurance Company, Inc., is set aside and this case is reversed. | [
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The opinion of the court was delivered by
Prager, J.:
This is an action brought by an unemancipated minor child against her mother to recover damages for personal injuries suffered by the child as the result of an automobile collision. The plaintiff-appellant, Rosanna Nocktonick, was a minor three years of age on October 15, 1976, the date of the collision. She was a passenger in an automobile operated by her natural mother, the defendant-appellee, Regina Nocktonick. The Nocktonick vehicle collided with an automobile driven by Eleanor Milner at the intersection of two county roads in Jackson County, Kansas. The plaintiff’s injuries included multiple fractures of her leg, requiring extensive hospitalization.
On August 17, 1977, Regina Nocktonick was appointed conservator of Rosanna for assertion of Rosanna’s claim against Eleanor Milner. This claim was satisfied by a settlement which was approved by the court and paid by Milner’s insurance company. The settlement was based upon a covenant not to sue, and reserved Rosanna’s right to proceed against her mother, Regina. Regina’s insurance carrier, Farmers Alliance Mutual Insurance Company, asserted a lien for the PIP benefits paid, and that sum was refunded from the settlement proceeds pursuant to court order. On October-3, 1977, Wayne Matson, Rosanna’s maternal grandfather, was appointed her conservator to pursue her claim against her mother. Rosanna’s petition was filed October 5, 1977, against both her mother, Regina, and Farmers Alliance Mutual Insurance Company. In her petition, Rosanna alleged her personal injuries were the result of her mother’s negligence in the operation of her motor vehicle. She claimed damages in the amount of $50,000, the limit of her mother’s liability insurance coverage. Farmers Alliance was later dismissed as a named party defendant. The defendant, Regina Nocktonick, then moved for summary judgment on the basis that the doctrine of parental immunity barred an action by an unemancipated minor against her parent to recover damages for negligent operation of a motor vehicle. The trial court granted summary judgment, holding that the doctrine of parental immunity should be applied in Kansas to bar such a claim. Plaintiff brought a timely appeal to this court.
This appeal requires us to consider whether an unemancipated minor may recover damages in an action against a parent for injuries allegedly caused by the negligence of the parent in the operation of an insured motor vehicle. This issue has never before been presented to an appellate court in Kansas. In Miles v. West, 224 Kan. 284, 580 P.2d 876 (1978), the doctrine of “intrafamily immunity” was referred to in the opinion at page 286 but the issue was not decided.
This court recognized the existence of interspousal tort immunity and applied it in Sink v. Sink, 172 Kan. 217, 239 P.2d 933 (1952), where it was held that in this state neither spouse may maintain an action in tort for damages against the other. Here, the court is free either to adopt the doctrine of parental immunity or to reject it, without overruling any prior Kansas case law, rejecting any rule of the common law, or invalidating any Kansas statute. Stated simply, our task is to decide which rule best serves the needs of justice in Kansas in the closing years of the twentieth century.
It would be helpful at the outset to discuss generally the history of parental immunity, the justifications usually advanced for its adoption or rejection, and the exceptions to the doctrine adopted in various cases. There is a comprehensive annotation on the subject of “Liability of Parent for Injury to Unemancipated Child Caused by Parent’s Negligence” in 41 A.L.R.3d 904. There the views presently followed in the various states are discussed in depth and the cases supporting each position are cited. All of the cases agree that parental immunity in tort is a creature of relatively recent American jurisprudence. The early English law is discussed at length in McCurdy, Torts Between Persons in Domestic Relation, 43 Harv. L. Rev. 1030, 1031-1050 (1930). It is clear that both the English and American cases have long permitted actions between parent and minor child in disputes involving property rights. Professor Prosser has suggested that there is no good reason to think that the English law would not permit actions for personal torts as well, subject always to the parent’s privilege to enforce reasonable discipline against the child. Prosser, Law of Torts § 122 (4th ed. 1971). Prosser points out that there are decisions in Canada and Scotland holding that such an action will lie. Other legal scholars have concluded that there is nothing in the English law which precludes an action in tort by a minor who has been wronged by his parent. Hebel v. Hebel, 435 P.2d 8 (Alaska 1967); 1 Harper & James, Law of Torts § 8.11 (1956). Thus, the general consensus seems to be that the doctrine of parental immunity has no foundation in the English law, but originated in the United States.
The doctrine of parental immunity was judicially created in a Mississippi case, Hewlett v. Ragsdale, 68 Miss. 703, 9 So. 885 (1891). In Hewlett, an unemancipated minor brought an action against her mother for the child’s illegal imprisonment in an insane asylum motivated by the mother’s desire to obtain the child’s property. The Mississippi Supreme Court refused to entertain the daughter’s claim, giving the following explanation:
“[S]o long as the parent is under obligation to care for, guide and control, and the child is under reciprocal obligation to aid and comfort and obey, no such action as this can be maintained. The peace of society, and of the families composing society, and a sound public policy, designed to subserve the repose of families and the best interest of society, forbid to the minor child a right to appear in court in the assertion of a claim to civil redress for personal injuries suffered at the hands of the parent. The state, through its criminal laws, will give the minor child protection from parental violence and wrongdoing, and this is all the child can be heard to demand.” p. 711.
The Mississippi court cited no authority in support of its holding.
The Hewlett decision was followed by McKelvey v. McKelvey, 111 Tenn. 388, 77 S.W. 664 (1903), in which a minor was precluded from asserting a claim for damages resulting from cruel and unusual treatment at the hands of her father and stepmother. The court concluded that sound public policy supported the decision. Two years later in 1905, in Roller v. Roller, 37 Wash. 242, 79 Pac. 788 (1905), the Supreme Court of Washington reversed a decision in favor of an unemancipated female child who had been raped by her father. The court held that such an action between the father and daughter did not lie because of the interest that society had in preserving harmony in domestic relations. Boiler was an aggravated case, and plaintiff’s counsel suggested to the court that the child having been raped by her father, it would seem that the harmonious relationship had already been disrupted. The court rejected this argument stating that “if it be once established that a child has a right to sue a parent for a tort, there is no practical line of demarkation which can be drawn.” p. 244. Hence the child was denied a remedy. Following these cases, most of the jurisdictions in the United States adopted the doctrine of parental immunity, holding that an unemancipated minor child may not maintain an action in tort against a parent to recover damages for personal injuries.
The doctrine of parental immunity has been justified on the basis of public policy. There are five policy reasons primarily relied on to support it:
(1) Disturbance of domestic harmony and tranquility;
(2) Interference with parental care, discipline, and control;
(3) Depletion of family assets in favor of the claimant at the expense of other children in the family;
(4) Possibility of inheritance by the parent of the amount recovered in damages by the child; and
(5) The danger of fraud and collusion between parent and child.
Domestic tranquility and interference with parental discipline, care, and control are the policy reasons most frequently offered by courts which have approved the rule. Skinner v. Whitley, 281 N.C. 476, 189 S.E.2d 230 (1972); Barlow v. Iblings, 261 Iowa 713, 156 N.W.2d 105 (1968). In support of parental immunity, many courts have relied heavily upon the interspousal immunity between husband and wife, pointing out that the same public policy is applicable to parent-child relationships as to husband-wife relationships.
After the parental immunity doctrine had become well accepted, many legal scholars and judges began to criticize the doctrine on the basis that its practical effect was to produce manifest injustice in many factual situations. See for example, Prosser, Law of Torts § 122 at 864; 1 Harper & James, Law of Torts § 8.11 at 650. Some of the writers point out the fact that litigation between parent and child over property rights is quite common, yet family harmony has seemed to survive. These writers argue that the law cannot reasonably make a distinction between the enforcement of property rights and the enforcement of personal rights. Furthermore, the “family harmony” rationale has been rejected on the basis that it is improbable that a suit would be filed against a parent by a child where there is not already discord in the family. Sorensen v. Sorensen, 369 Mass. 350, 339 N.E.2d 907 (1975). Others have questioned why a child not related to the tortfeasor should be permitted to recover in situations where a child of the tortfeasor is precluded from recovery, and, further, why an emancipated sibling, age 18, should have a cause of action against a parent for personal injury where an unemancipated child, age 17, does not.
These criticisms resulted in a series of judicial decisions which have eroded the doctrine by the creation of numerous exceptions to it. Today, there are very few jurisdictions, if any, which recognize parental immunity in its absolute form. The exceptions to the doctrine which have been recognized by various courts are the following:
(1) As noted above, parental immunity was never extended beyond personal torts.' It has never been recognized in cases in tort affecting only property, such as trespass to land or deceit.
(2) It was held almost from the beginning that the immunity did not apply to adult children or to minor children who had been emancipated by the surrender of parental control over them.
(3) Some courts hold that, where death has terminated the parent-child relationship, there is no longer any basis to apply the parental immunity rule, thus making it appropriate for claims to be brought against the child’s estate or the parent’s estate for personal wrongs. Dean v. Smith, 106 N.H. 314, 211 A.2d 410 (1965); Johnson v. Myers, 2 Ill. App. 3d 844, 277 N.E.2d 778 (1972).
(4) Another exception, recognized fairly early and supported by a good many decisions, has been that there is no immunity for the intentional or reckless infliction of bodily harm. This exception has been adopted on the theory that a parent who intentionally inflicts bodily harm on his child steps outside of his capacity as a parent. One application of this exception has been in the case of a parent who injures his child by his drunken driving of an automobile. Kobylanski v. Board of Education, 22 Ill. App. 3d 551, 317 N.E.2d 714 (1974); Hoffman v. Tracy, 67 Wash. 2d 31, 38, 406 P.2d 323 (1965).
(5) Another exception is that there is no immunity for bodily harm inflicted by conduct that is merely negligent, if the harm is inflicted in the course of a business activity carried on by the parent. The explanation usually given is that the parent has not injured his child while acting in his capacity as a parent but rather in his capacity of one conducting a business enterprise and that the enterprise should have no parental immunity. See Farley v. M M Cattle Company, 529 S.W.2d 751 (Tex. 1975); Cody v. J.A. Dodds & Sons, 252 Iowa 1394, 110 N.W.2d 255 (1961).
(6) It has been held that the immunity of the parent or child is a personal one that does not protect a third party who is liable for the tort of either. Thus, when a parent within the scope of his employment by another negligently inflicts personal injury upon his own child, his employer is not protected by the parent’s immunity and is subject to liability to the child as if the negligence had been that of the employer himself. Stapleton v. Stapleton, 85 Ga. App. 728, 70 S.E.2d 156 (1952); Mi-Lady Cleaners v. McDaniel, 235 Ala. 469, 179 So. 908 (1938).
(7) The immunity of the parent has not been extended to the case of one who stands in loco parentis — one who performs the functions of a parent without being one. When there is bodily harm inflicted by a stepfather, a grandparent, or a teacher looking after the child, there is no immunity. Thus, in a second marriage, the husband may be liable for negligent injury to the wife’s children but is not liable for injuries suffered by his own although arising out of the same negligent act.
(8) In recent years, several jurisdictions have carved an exception to the parental immunity rule to allow the child to sue his parent for injuries caused by the negligent operation of a motor vehicle. See for example, Streenz v. Streenz, 106 Ariz. 86, 471 P.2d 282 (1970); Sorensen v. Sorensen, 369 Mass. 350. The main justification relied on for allowing an action by a child against a parent in automobile accident cases is the prevalence of automobile liability insurance. While courts concede the existence of automobile insurance cannot create liability where none before existed, the prevalence of liability insurance has been held to be a proper factor to consider in determining the applicability of parental immunity. The courts which have recognized this exception have proceeded on the theory that where the reason for a rule of law no longer exists, the rule itself ceases. The existence of liability insurance is, therefore, recognized as preventing family discord and depletion of the family exchequer in automobile negligence cases. See for example Goller v. White, 20 Wis. 2d 402, 411, 122 N.W.2d 193 (1963); Sorensen v. Sorensen, 369 Mass, at 362.
Prior to 1963, the only attempt at complete abrogation of parental immunity had been made by an intermediate appellate court in Wells v. Wells, 48 S.W.2d 109 (Mo. App. 1932), but that decision was not followed by other courts. In 1963, in Goller v. White, 20 Wis. 402, the Supreme Court of Wisconsin abrogated parental immunity in negligence cases except in two situations: (1) Where the alleged negligent act involves an exercise of parental authority over the child, and (2) where the alleged negligent act involves an exercise of ordinary parental discretion with respect to the provision of food, clothing, housing, medical and dental services, and other care. Goller has now been followed by a substantial minority of jurisdictions. See for example, Plumley v. Klein, 388 Mich. 1, 199 N.W.2d 169 (1972); Hebel v. Hebel, 435 P.2d 8. In recent years seven jurisdictions have abolished parental immunity without restrictions:
California — Gibson v. Gibson, 3 Cal. 3d 914, 918, 92 Cal. Rptr. 288, 479 P.2d 648 (1971);
Hawaii — Petersen v. City & County, 51 Hawaii 484, 462 P.2d 1007 (1969);
Nevada — Rupert v. Stienne, 90 Nev. 397, 528 P.2d 1013 (1974);
New Hampshire — Briere v. Briere, 107 N.H. 432, 224 A.2d 588 (1966);
New York — Hairston v. Broadwater, 73 Misc. 2d 523, 342 N.Y.S.2d 787 (1973);
Gelbman v. Gelbman, 23 N.Y.2d 434, 297 N.Y.S.2d 529, 245 N.E.2d 192 (1969);
North Dakota — Nuelle v. Wells, 154 N.W.2d 364 (1967);
Pennsylvania — Falco v. Pados, 444 Pa. 372, 282 A.2d 351 (1971).
It is obvious from this historical review of the doctrine of parental immunity, with its many exceptions, that there has been a wide variance in the acceptance and application of the rule throughout this country.
In 1977,-the American Law Institute adopted § 895G of the Restatement (Second) of Torts (1979), which rejected the immunity from liability in tort between parent and child. In lieu thereof, it recognized privileges arising out of the parent-child relationship. It states as follows:
Ҥ 895G. Parent and Child.
“(1) A parent or child is not immune from tort liability to the other solely by reason of that relationship.
“(2) Repudiation of general tort immunity does not establish liability for an act or omission that, because of the parent-child relationship, is otherwise privileged or is not tortious.”
In the comment to § 895G, the Restatement discusses the history, justifications, exceptions, and abrogation of the doctrine of parental immunity. The comment to subsection (2) states in part as follows:
“k. With the abrogation of the general tort immunity between parent and child, the courts soon discovered that there still remain difficult problems of determining when a physical harm should be regarded as actionable. Intentional infliction of physical harm might appear to be clearly tortious. But there is the privilege of parental discipline. (See §§ 147-155). The intimacies of family life also involve intended physical contacts that would be actionable between strangers but may be commonplace and expected within the family. Family romping, even roughhouse play and momentary flares of temper not producing serious hurt, may be normal in many households, to the point that the privilege arising from consent becomes analogous.
“The intimacies of family life also affect the determination of whether conduct is negligent or not. If the conduct giving rise to an injury does not grow directly out of the family relationship, the existence of negligence may be determined as if the parties were not related. A similar attitude is taken regarding the driving of an automobile on the street or highway; most of the cases abrogating the immunity have involved automobile accidents.
“Conduct involving the exercise of parental authority or supervision is essential to the parent-child relationship. This is also true of the performance of parental duties such as the use of care to provide a safe place to live or adequate necessaries or proper instruction and training. Parental discretion is involved, and to say that the standard of a reasonable prudent parent is applied should be to recognize the existence of that discretion and thus to require that the conduct be palpably unreasonable in order to impose liability. . . .
“Just as the parent-child relationship creates an analogy to consent in the case of an intentional tort, so in the case of a negligent tort there is an analogy to the defense of assumption of risk. For activities central to that relationship, particularly within the home itself, there is some relaxation of the stricter standard of conduct applied in dealing with third persons. A child thoughtlessly leaves his skates in a hallway and the parent trips over them or slides on them and falls, or a parent delays fixing a slightly broken step or calling in a carpenter to do it and the child falls as a result; these occurences are normally regarded as commonplace incidents in family life and usually treated as accidents rather than the basis for imposing legal liability.
“These problems are comparatively new to the courts as a result of the recent abrogation of immunity, and the courts have not yet worked out a full analysis of the proper legal treatment. The reasons put forward for a general tort immunity still carry weight and some courts conclude that there should be a remaining immunity for certain types of activities. The analysis here, however, seems more appropriate than the granting of a categoric immunity for these types of activities, regardless of the blatancy of the negligence or the wilfulness of the conduct.
“Ostensibly extraneous matters that have significantly affected some decisions in the past and will probably continue to do so, include the presence of liability insurance and the fact that a suit is brought by a third-party defendant for contribution rather than by the injured party for compensation.”
As we observed in the beginning, our task is to decide which rule best serves the needs of justice in Kansas in the closing years of the twentieth century. In so doing, we must recognize that the more recent decisions rejecting parental immunity are indicative of a “growing judicial distaste for a rule of law which in one sweep disqualified an entire class of injured minors.” Gibson v. Gibson, 3 Cal. 3d at 918. We believe that the authorities which favor abrogation of the parental immunity doctrine state the proper approach in light of modern conditions and conceptions of public policy. We see no good reason why children should not enjoy the same right to protection and to legal redress for wrongs done them as others enjoy. We question the view that a regard for family harmony and tranquility necessitates denial of tort recovery to a child injured in an automobile accident.
We are inclined to agree with Judge Fuld’s dissent in Badigian v. Badigian, 9 N.Y.2d 472, 478, 215 N.Y.S.2d 35, 174 N.E.2d 718 (1961), which states in part as follows;
“Those parents who are worthy of affection will make provision for the crippled child to the extent of their ability without the spur of legal process. The child will be unwilling to sue, will have no need or thought to sue. What is right will be done, and it will be done out of love that is stronger than the law. There may be some parents who are selfish or indifferent or cruel; if they turn the crippled child adrift when his minority is over, he will be a drag upon society and a burden to himself. We should say that they may not do so with impunity. There are other parents who, though willing, may be helpless. We should hold that the child is not to be denied the benefit of insurance that would be available for a stranger.”
We have concluded that, under the factual circumstances of this case, an unemancipated minor child may recover damages in an action brought against a parent for personal injuries caused by the negligence of the parent in the operation of a motor vehicle. This conclusion is consistent with a growing list of states which, in recent years, have adopted this position. States which have abolished parental immunity in all cases or in automobile accident cases include:
Alaska — Hebel v. Hebel, 435 P.2d 8 (1967);
Arizona — Streenz v. Streenz, 106 Ariz. 86, 471 P.2d 282 (1970);
California— Gibson v. Gibson, 3 Cal. 3d 914, 92 Cal. Rptr. 288, 479 P.2d 648 (1971);
Connecticut — G.S. 1979 Supp. 52-572c;
Hawaii — Tamashiro v. De Gama, 51 Hawaii 40, 450 P.2d 998 (1969);
Petersen v. City & County, 51 Hawaii 484, 462 P.2d 1007 (1969);
Illinois — Schenk v. Schenk, 100 Ill. App. 2d 199, 241 N.E.2d 12 (1968);
Kentucky — Rigdon v. Rigdon, 465 S.W.2d 921 (1971);
Massachusetts — Sorensen v. Sorensen, 369 Mass. 350, 339 N.E.2d 907 (1975);
Michigan — Plumley v. Klein, 388 Mich. 1, 199 N.W.2d 169 (1972);
Minnesota — Silesky v. Kelman, 281 Minn. 431, 438-439, 161 N.W.2d 631 (1968);
New Hampshire — Briere v. Briere, 107 N.H. 432, 224 P.2d 588 (1966);
New Jersey — France v. A.P.A. Transport Corp., 56 N.J. 500, 267 A.2d 490 (1970);
New York — Gelbman v. Gelbman, 23 N.Y.2d 434, 297 N.Y.S.2d 529, 245 N.E.2d 192 (1969);
Nevada — Rupert v. Stienne, 90 Nev. 397, 528 P.2d 1013 (1974);
North Carolina — G.S. 1979 Supp. 1-539.21;
North Dakota — Nuelle v. Wells, 154 N.W.2d 364 (1967);
Pennsylvania — Falco v. Pados, 444 Pa. 372, 282 A.2d 351 (1971);
Virginia — Smith v. Kauffman, 212 Va. 181, 183 S.E.2d 190 (1971);
West Virginia — Lee v. Comer, 224 S.E.2d 721 (W. Va. 1976). It should be noted that the states listed above have followed for many years the rule which we have adopted today. Yet there apparently has been no significant disruption in family relationships as grimly predicted by the prophets of doom who insist on the application of parental immunity in automobile negligence cases.
We believe that the argument that parental immunity is necessary to preserve the tranquility and harmony of domestic life misconceives the facts of domestic life. The primary disruption to harmonious family relationships is not the lawsuit brought for damages after the injury but the injury itself, resulting from the misconduct of a parent. Falco v. Pados, 444 Pa. at 380. It can hardly aid family reconciliation to deny an injured child access to the courts and, through them, to any liability insurance which the family might maintain.
In Kansas, motor vehicle liability insurance is mandatory under K.S.A. 1979 Supp. 40-3104. The required contents of each insurance policy are set out in K.S.A. 1979 Supp. 40-3107. Although insurance cannot create liability where no legal duty previously existed, it remains, nevertheless, a proper element to be considered in a discussion of the public policy supporting abrogation of parental immunity. As pointed out in Streenz v. Streenz, where liability insurance exists, the domestic tranquility argument is hollow, for in reality the sought after litigation is not between child and parent but between child and parent’s insurance carrier. Far from being a potential source of disharmony, the action is more likely to preserve the family unit in pursuit of a common goal — the easing of family financial difficulties stemming from the child’s injuries. Gelbman v. Gelbman, 23 N.Y.2d at 438; Goller v. White, 20 Wis. 2d at 412.
We recognize a practical problem is that of possible collusion between parent and child aimed at securing an unjustified recovery from an insurance company. But the possibility of collusion exists to a certain extent in any case. Every day we depend on juries and trial judges to sift evidence in order to determine the facts and arrive at proper verdicts. Experience has shown that the courts are quite adequate for this task. In litigation between parent and child, judges and juries would naturally be mindful of the relationship and would be even more on the alert for improper conduct. We further must recognize that, under provisions ordinarily included in an insurance policy, the insurance company has the right to disclaim liability when there is lack of cooperation with the insurance company on the part of the insured. Lack of cooperation may be found in inconsistent or contradictory statements by the insured or in collusion between the injured party and the insured which results in false statements to the company.
In Sorensen v. Sorensen, 369 Mass, at 365, the court commented on the danger of collusion between parent and child in the following language:
“The existence of collusion and lack of cooperation is not difficult to establish in the ordinary motor vehicle accident case. Prompt, effective insurance company investigation and the requirement of prompt reports of accidents to the registry of motor vehicles and to the insurer quickly establish the essential facts. Normally, any attempt at deviation from the facts by the insured will be speedily evident and will warrant disclaimer by the insurance carrier. The parent is usually represented by counsel provided by the insurance company. Such counsel is ever alert to protect the interests of the insurance company and ready to expose any attempts at collusive and fraudulent conduct. Any overt attempt at collusion constitutes a criminal offense and will be punishable as such.
“Some collusive claims may succeed. But this does not justify the formulation of a rule of blanket denial of recovery for all minors. It would be unjust to bar arbitrarily the claims of injured minors deserving of relief solely because some cases may involve possible collusion between two parties (citations omitted).”
The possibility of collusion was advanced as an argument to justify the Kansas guest statute which was held unconstitutional in Henry v. Bauder, 213 Kan. 751, 518 P.2d 362 (1974). In Henry, we rejected this argument, stating that it is unreasonable to éliminate causes of action of an entire class of persons simply because some undefined portion of the designated class may file fraudulent lawsuits. We emphasized that courts must depend upon the efficiency of the judicial processes to ferret out the meritorious from the fraudulent in particular cases.
Our holding is limited to the factual circumstances of the case now before us — an automobile tort action brought by an unemancipated minor child against a parent. Allowance of such an action does not undermine parental authority and discipline nor does it threaten to substitute judicial discretion for parental discretion in the care and rearing of minor children. We recognize that there may be parental exercises of discretion and authority which should be provided special protection in a court of law. Here we merely remove any barrier to the enforcement of liability between parent and child in an automobile accident case brought by an unemancipated minor against a parent. When confronted with other cases involving claimed parental immunity, we will at that time determine to what extent parental immunity or privilege should be recognized under the particular circumstances of the case then before us.
For the reasons set forth above the judgment of the district court is reversed. The case is remanded to the district court with directions to set aside the order of summary judgment entered below and to permit the parties to proceed with the determination of the issues presented in the case. | [
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On this 11th day of February, 1980, the matter of the voluntary surrender by Alvin F. Grauerholz of his license to practice law comes before the court. The court, being fully advised, finds that Alvin F. Grauerholz should be suspended indefinitely from the practice of law in the State of Kansas and that the Clerk of the Appellate Courts shall take possession of the certificate of Alvin F. Grauerholz to practice law and hold the same until the further order of this court.
IT IS THEREFORE ORDERED that Alvin F. Grauerholz be and he is hereby indefinitely suspended, until the further order of the court, from the practice of law in the State of Kansas.
IT IS FURTHER ORDERED that the Clerk of the Appellate Courts shall receive the certificate of Alvin F. Grauerholz to practice law and hold the same until the further order of this court. | [
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The opinion of the court was delivered by
Herd, J.:
Darwin Wayne May was convicted by a jury of the kidnapping (K.S.A. 21-3420) of a small child. He appeals and we affirm.
On October 4, 1978, at approximately 11:30 a.m., Gary Hadley Thomason, age five, was kidnapped near his home on Beechwood Terrace, Manhattan. May was one of the three men who planned the crime which was to culminate in the receipt of a $30,000 ransom. He was to act as the pickup man for the money and receive $5,000 as his share. The pickup place was the men’s room of the Walk-In Lounge, a tavern in Junction City. The day before the kidnapping the defendant made arrangements for one of the kidnappers to use the car of a friend the following day. The other two went to Manhattan on October 4 and seized the child at 11:30 a.m. They then drove to Wakefield where one of them made the ransom call to Gary’s parents. The Thomasons were instructed to place the money in a brown paper bag and drop it at the pickup point no later than 8:00 p.m. that day. The other kidnapper called May and told him they had the child and the money would be dropped as planned. The little boy’s father obtained the ransom money and made the drop himself. The Riley County Police, the K.B.I. and the F.B.I. initiated a surveillance plan for the drop area, stationing officers inside the tavern shortly before 8:00 p.m. Defendant May was later identified as having been in the lounge when Gary’s father made the drop. May abandoned his attempt to pick up the ransom when he realized the place was surrounded by police. The child was released in the Junction City area at 10:00 p.m. that evening and the ransom money was recovered and returned to Mr. Thomason.
The investigation of the kidnapping terminated in the arrest of all three defendants on October 11, 1978. One of the defendants was identified the day before as having been at the restaurant in Wakefield when the ransom call was made. As a result, the other two kidnappers were questioned on the 11th and both admitted their participation as well as implicated the defendant May.
The trial was held in February, 1979. May was convicted by the jury of kidnapping and was sentenced on April 9, 1979, to a minimum term of 9 years to a maximum of life, an identical sentence to that of the other two kidnappers.
May first contends the trial court erred in denying him a change of venue. Prior to trial he filed a motion for change of venue pursuant to K.S.A. 22-2616. He supported the motion with evidence of newspaper accounts of the kidnapping published in the Manhattan Mercury and the Kansas State Collegian; transcripts of broadcasts on radio stations KMAN and KMKF; oral testimony of the news director of radio stations KMAN and KMKF; and transcripts of news broadcasts of TV station KTSB, Topeka. The trial court denied the motion as not showing sufficient prejudice to warrant a change of venue.
We set forth the law on change of venue in State v. Porter, 223 Kan. 114, 117, 574 P.2d 187 (1977), where we stated:
“A change of venue in a criminal case lies within the sound discretion of the trial court. [Citations omitted.] The burden of proof is cast upon defendant to show prejudice in the community which will prevent him from obtaining a fair and impartial trial. [Citations omitted.] Media publicity alone has never established prejudice per se. Defendant must show prejudice has reached the community to the degree it is impossible to get an impartial jury.”
See State v. Foy, 224 Kan. 558, 582 P.2d 281 (1978); State v. Gilder, 223 Kan. 220, 222-223, 574 P.2d 196 (1977).
In State v. McLaughlin, 207 Kan. 594, 598, 485 P.2d 1360 (1971), we stated:
“Furthermore, prejudice must be established ‘not as a matter of speculation but as a demonstrable reality.’ ”
In Gilder, the defendant was charged with aggravated robbery, aggravated sodomy, and rape of an elderly woman who stopped at a highway rest area west of Parsons. The trial was held in “a rather sparsely populated community,” as noted by the court. In upholding the trial court’s denial of the motion for change of venue, this court stated at page 223:
“In this case defendant presented only newspaper articles in support of his motion for change of venue. No evidence or affidavits were introduced to establish the effect publicity might have on prospective jurors. It does not appear that jury selection was inordinately difficult due to pretrial publicity, or that jurors were even aware of the publicity. The trial court properly denied a motion for change of venue under those circumstances.”
Defendant cites the case of Sheppard v. Maxwell, 384 U.S. 333, 16 L.Ed.2d 600, 86 S.Ct. 1507 (1966), in support of his argument. This is the celebrated case of Dr. Sam Sheppard, who was accused of murdering his wife, Marilyn. The case is easily distinguishable from the case at bar. The newspaper and television coverage was massive with headlines constantly stressing the doctor’s lack of cooperation with police and other officials. Every detail of the trial was reported. Representatives of the newspapers and wire services, as well as television and radio reporters were present. Many had assigned seats in the courtroom. Private telephone lines and telegraphic equipment were installed in courthouse news media rooms so reports from the trial could be speeded to the news outlets. Station WSRS was permitted to set up broadcasting facilities on the third floor of the courthouse next door to the jury room, where the jury rested during recesses and later deliberated. Although a courthouse rule prohibited picture taking in the courtroom, it was never enforced. Daily records of the proceedings were made available to all media people with pictures of everyone involved in the case. In effect, Sheppard was brought to trial, tried and convicted by the media before an actual trial occurred.
It is clear the circumstances of the instant case are not comparable to those present in the Sheppard case. The defendant offered only copies of the newspaper articles and evidence that local radio and television stations broadcast the story to the public. We have examined the articles and the transcripts of television and radio broadcasts and find the stories were factual, intemperate language and did not draw conclusions of guilt. In State v. McCorgary, 218 Kan. 358, 367, 543 P.2d 952 (1975), cert. denied 429 U.S. 867 (1976), this court said:
“The publication of newspaper articles in the local papers does not establish prejudice per se.”
See also State v. Goering, 225 Kan. 755, 760, 594 P.2d 194 (1979). We hold the defendant May did not sustain the burden of proving prejudice entitling him to a change of venue. Defendant’s contention is without merit.
May’s next issue presumes our holding his evidence of prejudice inadequate and contends the trial court committed reversible error in denying his motion for funds to conduct a scientific public opinion poll to determine if community prejudice existed. He argues his position is supported by ABA Standards, Fair Trial and Free Press § 3.2(b) (1968), which states: “In addition . . . qualified public opinion surveys shall be admissible as well as other materials having probative value.” Appellant argues it is inconsistent to impose the burden of proving community prejudice on him and then to deny him the resources to obtain the evidence to meet that burden, particularly where the costs would be minimal. In addition, he argues voir dire later confirmed that the publicity had an adverse effect on defendant’s ability to select a fair and impartial jury. He states that prejudice would have been avoided by a public opinion poll and the resulting change of venue.
The record reveals defendant filed his motion to obtain funds for a public opinion poll prior to trial. A hearing was held December 20,1978, and the motion was denied. At the hearing on the motion, defendant offered only copies of the newspaper articles and radio transcripts in support of the motion. No af fidavits of prejudice or testimony were offered. K.S.A. 22-2616 provides:
“(1) In any prosecution, the court upon motion of the defendant shall order that the case be transferred as to him to another county or district if the court is satisfied that there exists in the county where the prosecution is pending so great a prejudice against the defendant that he cannot obtain a fair and impartial trial in that county.”
Clearly the trial court had. no evidence that would indicate community prejudice existed at the hearing on the motion. The defendant was provided counsel and through him had resources available to obtain affidavits and witnesses as to community prejudice if it did, in fact, exist. We do not preclude the possibility of the use of a public opinion poll because exigent circumstances could arise where in the sound discretion of the trial court such a poll would be deemed necessary. In the absence of a showing of such circumstances, however, the funds requested would be for a type of “fishing expedition,” far outside the gambit of the fair trial guarantees. In State v. Frames, 213 Kan. 113, 515 P.2d 751 (1973), the defendant was convicted of perjury and claimed the trial court improperly overruled his request for funds to hire an expert to determine if community prejudice existed. In that case, we stated at page 118:
“The record contains evidence of extensive newspaper publicity about the case in Johnson County. In this state the granting or denial of a motion to provide investigative services to counsel for an indigent defendant in a criminal prosecution is a matter which rests within the sound discretion of the trial court. Its ruling will not be disturbed in the absence of a showing that its discretion has been abused to the extent that a defendant’s substantial rights have been prejudiced. [Citations omitted.] The record here does not disclose an abuse of discretion on the part of the trial court in denying the requested funds. The cost for such a survey would have been approximately $1700. The defendant offered no affidavits to show community prejudice at the time defendant’s motion was considered. Likewise the record is completely devoid of evidence that difficulties were encountered at the trial in selecting a jury to hear the case.”
The instant case is comparable to the Frames case in the lack of difficulty in choosing a jury. Here, no difficulty was experienced in obtaining a jury from the Jist of 70 to 74 persons. Four persons were excused for cause on motion of the State and two were excused on motion of the defendant. Jury selection took only three hours. We find the trial court exercised sound discretion in denying appellant’s motion for funds for a public opinion poll on community prejudice. This issue is without merit.
Finally, defendant contends the prosecutor’s statements at sentencing were so prejudicial they denied him a fair and impartial hearing. The statements complained of were to the effect that the defendant had been found guilty by a jury after a plea of not guilty; the defendant took the stand and denied participation in the crime with an alibi, and continued to deny involvement even up to the time of sentencing. The prosecutor went on to say,
“I would submit to the Court that not only did he commit this crime of kidnapping but also he committed the crime of perjury. I don’t think the Court can lose sight of the fact that if somebody wants to use the system and use the system to the point that he is willing to get up on the stand and lie that he would not receive additional punishment for that — I would not ask Mr. May receive a maximum of 15 years, but I would certainly think that there should be some additional punishment imposed because of how May abused the system, how Mr. May could come forward and get up on that stand, take an oath and then lie before these 12 people.”
With that the prosecutor asked that May be given a more severe sentence than the other two kidnappers.
The trial court heard argument of both counsel, reviewed the presentence investigation report, and then sentenced May to 9 years to life, the same sentence as the other defendants who participated in this crime.
Appellant claims the prosecutor’s statements had considerable effect on the sentence and bases his objection to them on the ABA Standards, The Prosecution Function § 6.1(b) (1971), where it states:
“Where sentence is fixed by the judge without jury participation, the prosecutor ordinarily should not make any specific recommendation as to the appropriate sentence, unless his recommendation is requested by the court or he has agreed to make a recommendation as the result of plea discussions.”
There can be no question the ABA Standards are a sound statement of proper conduct and we confirm it. We also find nothing inconsistent between that standard and K.S.A. 21-4603. In this case, the record shows the trial court followed both the statute and the ABA statement. The court requested a statement from both parties, a practice recognized by the ABA, then proceeded to pronounce sentence disregarding the prosecutor’s recommendation. If the statements were objectionable, they were harmless in this case. We recognize that a prosecutor’s statements at sentencing concerning the defendant’s trial conduct must be cautiously used. An accused certainly has the right to plead “not guilty” without chancing an accusation of perjury if the jury convicts. However, an accused’s taking the stand and swearing falsely falls in a different category. In United States v. Grayson, 438 U.S. 41, 44, 57 L.Ed.2d 582, 98 S.Ct. 2610 (1978), at the sentencing hearing the trial judge stated:
“I’m going to give my reasons for sentencing in this case with clarity, because one of the reasons may well be considered by a Court of Appeals to be impermissible; and although I could come into this Court Room and sentence this Defendant to a five-year prison term without any explanation at all, I think it is fair that I give the reasons so that if a Court of Appeals feels that one of the reasons which I am about to enunciate is an improper consideration for a trial judge, then the Court will be in a position to reverse this Court and send the case back for resentencing.
“In my view a prison sentence is indicated, and the sentence that the Court is going to impose is to deter you, Mr. Grayson, and others who are similarly situated. Secondly it is my view that your defense was a complete fabrication without the slightest merit whatsoever. I feel that it is proper for me to consider that fact in sentencing, and I will do so.”
The Supreme Court, in affirming the conviction, stated at page 55:
“[W]e are reaffirming the authority of the sentencing judge to evaluate carefully a defendant’s testimony on the stand, determine — with a consciousness of the frailty of human judgment — whether that testimony contained willful and material falsehoods, and, if so, assess in light of all the other knowledge gained about the defendant the meaning of that conduct with respect to his prospects for rehabilitation and restoration to a useful place in society.”
Inasmuch as the sentencing judge may consider the falsity of defendant’s testimony, there can be no objection to the prosecutor offering his suggestions at the request of the trial judge. Appellant’s issue is without merit. The judgment of the trial court is affirmed. | [
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The opinion of the court was delivered by
Miller, J.:
This is an appeal by the third-party defendant, Ellen G. Van Kam Cunningham, from a judgment against her and in favor of the defendant and third-party plaintiff, Alice M. Kirk, for attorney’s fees. The only issue on appeal is the propriety of the award of attorney’s fees under K.S.A. 1979 Supp. 60-2006.
This action for recovery of damages sustained in a two-vehicle collision was instituted by the Faucetts, owners of one vehicle, by filing a chapter 61 action on July 8, 1977, against Alice M. Kirk, driver of the second vehicle, for property damage of $2,950. On October 20, 1977, Mrs. Kirk filed her answer and a claim against third-party defendant Cunningham, who was driving the Faucett vehicle at the time of the collision. Mrs. Kirk sought judgment of $200 for damages to her automobile and $1,000 for personal injuries sustained by her minor child, Bryna Kirk. At the time of pretrial, Mrs. Kirk continued to assert her $200 claim for property damages, increased her claim on behalf of her daughter to $2,500, and also requested an award of costs and attorney’s fees.
Approximately two weeks prior to trial, counsel for Mrs. Kirk advised counsel for Mrs. Cunningham, by letter, that at trial Mrs. Kirk proposed to increase her claim for property damage to $500 and to claim $250 for loss of the use of her car. She also sought $750 for attorney’s fees. Additionally, counsel was advised that the personal injury claim on behalf of Bryna Kirk would be dismissed.
When trial commenced on May 17, 1978, the claim on behalf of Bryna Kirk was dismissed; the property damage claim on behalf of Alice Kirk was increased to $500; and the $250 claim for loss of use was dismissed. Mrs. Kirk also sought attorney’s fees and costs. The jury returned a verdict finding Mrs. Cunningham 80% at fault and Mrs. Kirk 20% at fault. It found the Faucetts’ damages to be $1,450 and Mrs. Kirk’s damage to be $400. Judgment was entered on behalf of the Faucetts against Mrs. Kirk for $295, and in favor of Mrs. Kirk and against Mrs. Cunningham for $320; in addition, the trial court awarded Mrs. Kirk attorney’s fees of $300 as against Mrs. Cunningham. The latter award forms the basis for this appeal.
Appellant contends (1) that K.S.A. 1979 Supp. 60-2006 is inapplicable in any action when the claim of plaintiff or any party exceeds the monetary limit fixed by the statute; and (2) that Mrs. Kirk’s claim exceeds the monetary limit, and therefore she is not entitled to any award of attorney’s fees.
K.S.A. 1979 Supp. 60-2006 reads as follows:
“In actions brought for the recovery of damages of less than seven hundred fifty dollars ($750) sustained and caused by the negligent operation of a motor vehicle, including any action brought pursuant to the code of civil procedure for limited actions, the prevailing party, if such party recovers damages, shall be allowed reasonable attorneys’ fees which shall be taxed as part of the costs of such action, except that when a tender has been made by the adverse party before the commencement of the action in which judgment is rendered, and the amount recovered is not in excess of such tender, no such costs shall be allowed.”
We considered the statute and upheld its constitutionality in Pinkerton v. Schwiethale, 208 Kan. 596, 493 P.2d 200 (1972). At that time the statute applied to “actions brought for the recovery of damages of less than five hundred dollars.” It was amended to “less than seven hundred fifty dollars” in 1977. Writing for a unanimous court, Justice Fromme said:
“Let us consider the classification employed by the legislature in the present statute. Generally the classification relates to all parties who may cause damage by the negligent operation of a motor vehicle. The word ‘parties’ as used in this statute, which is a part of the Code of Civil Procedure of this state, encompasses all litigants, both persons and corporate bodies. There is no discrimination in the classification defined by the use of the term ‘parties’.
“The classification relates to those who cause damage by the negligent use of a motor vehicle. This is an age of almost universal ownership and transportation by motor vehicle. With few exceptions there is a car in every garage and sometimes two or three. The streets and highways in many areas of the state have become congested. Vehicular accidents occur with increasing frequency. There has been a proliferation of law suits arising from these accidents. These law suits burden the courts of this state. Many suits are brought on small claims for less than $500.00. Because of the increasing number of these suits serious delays in court have occurred because of a backlog of cases. Several years may pass after an accident before a meritorious claim can be collected through the courts. Abuses arise from this delay. Those who have negligently caused the damage, or their insurance carriers, may refuse to pay a just claim in order to take a calculated risk. The expenses and attorney fees which a claimant with a small meritorious claim must incur to successfully collect his claim may seem prohibitive to the claimant. The injured claimant may well decide to forego his rights in court rather than wait, worry and litigate. Especially is this true in cases of small claims. The time and expense necessary to investigate and prosecute a small claim is frequently out of proportion to the amount recoverable.
“K.S.A. 1971 Supp. 60-2006 appears to be grounded on police regulation in the public welfare having for its legitimate purpose the promotion of prompt payment of small but well-founded claims and the discouragement of unnecessary litigation of certain automobile negligence cases.
“It should also be noted the allowance permitted under this statute is not limited to successful plaintiffs. The statute provides the prevailing party if he recovers damages is entitled to a reasonable attorney’s fee to be taxed as costs. Fault is the basis for the allowance and not who files the suit. Both parties may contend for damages based on the fault of the other. The defendant does so by cross-claim under K.S.A. 1971 Supp. 60-213. In such case either party may recover attorneys’ fees as costs if he recovers his damages.” (pp. 598-601.)
Turning to appellant’s first claim, is the statute inapplicable if any party makes claim for $750 or more? We think not. The statute applies to the prevailing party. Under appellant’s theory, a litigant could defeat the purpose of the statute and thwart recovery of attorney’s fees by a successful party on a meritorious claim of less than $750 by merely asserting a claim, counterclaim, or cross-claim, however spurious, of more than $750. We hold that the statute’s applicability is to be determined separately and individually as to each prevailing party whose claim is successfully litigated; the amounts of claims of other parties to the action are immaterial. Here, Mrs. Kirk is a prevailing party; her claim must be individually considered under the statute. Whether her claim is within the statute is the remaining issue to be determined.
The Faucetts’ petition sought $2,950 for property damage; their claim was never amended. Originally Mrs. Kirk made claim for herself for property damages of $200 and on behalf of her minor child for personal injuries of $1,000. At pretrial, the $200 property damage claim was asserted, and the personal injury claim was raised to $2,500. By letter before trial, the property damage claim was increased to a total of $750, and the personal injury claim was dropped. At trial the property damage claim was reduced to $500.
Regardless of the amount recovered, the highest amount claimed at any time during the pendency of the action by a prevailing party is determinative of whether that party comes within the confines of the statute. The Faucetts sought recovery of more than $750; therefore, the statute is inapplicable to their claim. They did not seek attorney’s fees. Mrs. Kirk at one time claimed property damages of $750 for herself and she claimed $1,000, later $2,500, on behalf of her daughter. Her maximum claim asserted during the pendency of the action was not “less than seven hundred fifty dollars,” and we therefore hold that the statute has no applicability. Mrs. Kirk was not entitled to recover an attorney’s fee in the trial court under K.S.A. 1979 Supp. 60-2006. Likewise, she is not entitled to an award of attorney’s fees for this appeal.
The judgment of the district court awarding an attorney’s fee to Alice M. Kirk is reversed. | [
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The opinion of the court was delivered by
Prager, J.:
This is a controversy between a teachers association and a school board as to whether certain items in dispute during professional contract negotiations are mandatorily negotiable. Many of the items have been resolved in our recent decisions in NEA-Topeka, Inc. v. U.S.D. No. 501, 225 Kan. 445, 592 P.2d 93 (1979); Chee-Craw Teachers Ass'n v. U.S.D. No. 247, 225 Kan. 561, 593 P.2d 406 (1979); NEA-Parsons v. U.S.D. No. 503, 225 Kan. 581, 593 P.2d 414 (1979); and Tri-County Educators’ Ass’n v. Tri-County Special Ed., 225 Kan. 781, 594 P.2d 207 (1979). The teachers organization appealed the trial court’s decision as to certain items. The school board also cross-appealed but then voluntarily dismissed its cross-appeal, because the issues raised in the cross-appeal were subsequently determined in the four cases cited.
The district court rendered its decision on May 31, 1978, without the benefit of the guidelines set down in NEA-Topeka, Chee-Craw, NEA-Parsons, and Tri-County. In a well-reasoned opinion, the court considered each of the disputed items, taking into consideration the following criteria:
(1) Whether the item is included in the definition of “terms and conditions of professional service” as set forth in K.S.A. 1977 Supp. 72-5413(0;
(2) Whether such item, though not specifically enumerated, was nonetheless mandatorily negotiable under 72-5413(0 as having a greater direct impact on the teacher than on the operation of the school system as a whole;
(3) Whether the proposal was in conflict with the management prerogative reserved to the board in K.S.A. 1977 Supp. 72-5423;
(4) Whether the proposal was currently a school board policy incorporated by reference into the teachers’ contracts, and not mandatorily negotiable as a new item or amendment under 72-5423;
(5) Whether the proposal involved a subject over which the board had no discretion because of a constitutional provision, statute, regulation, or court decision which precluded negotiation thereon.
Applying these principles, the court held the following items not to be mandatorily negotiable: (1) Reproduction of negotiation agreements; (2) assignment and transfer of teachers; (3) teacher evaluation; (4) class size; (5) payroll deductions; (6) school calendar; (7) preparation time and meetings; (8) assignment and equipment storage for traveling teachers; and (9) association rights not connected with professional negotiations. Items found to be mandatorily negotiable were salary adjustment for class size, student discipline, and contract forms.
The teachers association appealed from the trial court’s decision on those items held not mandatorily negotiable. As noted, the school board cross-appealed as to items held to be mandatorily negotiable but dismissed its cross-appeal. We will proceed to consider only the items which the trial court held not mandatorily negotiable which have been appealed by the teachers association to this court.
At the outset, we wish to emphasize that a determination that an item is not mandatorily negotiable does not mean that the item is not an appropriate subject for negotiation between a teachers association and a school board. The negotiating parties, in the public interest, should consider concessions which would facili tate the task of the other in carrying out its statutory functions where the benefit to the one is clear and there is no corresponding detriment to the other. That is the way responsible people who are in good faith act where there is a public interest in their endeavors.
We now turn to the specific items in dispute:
(1) Reproduction of agreements. This item was held mandatorily negotiable in NEA-Topeka, Inc. v. U.S.D. No. 501, 225 Kan. at 451. The trial court is reversed in its finding to the contrary.
(2) Assignment and transfer. This item is not mandatorily negotiable by the court’s decisions in Chee-Craw Teachers Assn v. U.S.D. No. 247, 225 Kan. at 569, and Tri-County Educators’ Ass’n v. Tri-County Special Ed., 225 Kan. at 784. The trial court is affirmed on this item.
(3) Teacher evaluation. This item was held not mandatorily negotiable in Tri-County Educators’ Ass’n v. Tri-County Special Ed., 225 Kan. at 784. The trial court is affirmed on this item.
(4) Teacher load. Class size was held not mandatorily negotiable in NEA-Topeka, Inc. v. U.S.D. No. 501, 225 Kan. at 451. The subject of paraprofessional aides was held not mandatorily negotiable in Tri-County Educators’ Ass’n v. Tri-County Special Ed., 225 Kan. at 785. We adhere to our prior rulings on these items and, therefore, affirm the decision of the trial court as to them.
(5) Payroll deductions. This subject was held mandatorily negotiable in NEA-Topeka, Inc. v. U.S.D. No. 501, 225 Kan. at 451, and Chee-Craw Teachers Ass’n v. U.S.D. No. 247, 225 Kan. at 570. The trial court is reversed in its finding to the contrary.
(6) School calendar. The NEA’s proposal on the school calendar included the beginning and ending dates of the school term and specific holidays and vacations stipulated by both parties to be negotiable. We have concluded that the specific beginning and ending dates for the school term are not mandatorily negotiable. This subject does not fall within any of the specific topics listed in 72-5413(Í). Likewise, we conclude that it does not satisfy the impact test as having a greater impact on the individual teacher than on the operation of the school system. The beginning and ending dates of the school term affect not only teachers, but the students, their parents, and all nonteacher employees of the board. We hold that the trial court correctly determined that the specific beginning and ending dates of the school term are not mandatorily negotiable.
(7) Preparation time and meetings. This item involves three specific provisions: 1. A proposal for the use of one-half day at the end of each quarter for grade card preparation and planning; 2. a proposal for a seven and one-half, hour work day including 30 minutes daily preparation time without assigned duties during such period; and 3. a proposal limiting the number of monthly faculty meetings requiring attendance after the regular work day without additional compensation. We have concluded that all of these items reasonably fall within the category of “hours and amounts of work” and, therefore, are mandatorily negotiable. Chee-Craw, 225 Kan. at 570, held the length of day, arrival and departure time, number of teaching periods, duty-free lunch period, and no custodial work, to be mandatorily negotiablé as included in the statutory item, hours and amounts of work. Logically, the same rule should apply to the three contested items listed above. We hold all of them to be mandatorily negotiable within the specific category of “hours and amounts of work.” On this item, the decision of the trial court is reversed.
(8) Assignment and equipment storage for traveling teachers. Assignment and transfer of teachers falls within item No. 2 discussed above and is not mandatorily negotiable by our decisions in Chee-Craw and Tri-County. This proposal also includes classroom and storage facilities for a traveling teacher. This item reasonably falls within the category of facilities and equipment held not to be mandatorily negotiable in Tri-County, 225 Kan. at 785. The trial court is affirmed on this item.
(9) Association rights. This proposal involves certain association rights not previously determined in prior decisions. The specific items presented for consideration include: 1. The use by the NEA of at least one bulletin board in each school to be provided by the school board; 2. use by the NEA of school office equipment for a reasonable rental to be paid by the teachers association; 3. access to school board information concerning the district’s financial resources; and 4. a provision that “the rights granted to the association shall not be granted or extended to any other organization claiming to represent employees of the district.” As to the bulletin board and the rental of office equipment, we find that the trial court properly held these items not to be mandatorily negotiable. These are merely incidental items which involve matters for the convenience of the teachers association in carrying out its functions. Both items are proper subjects for permissible negotiations between the parties.
The proposal pertaining to access to information was as follows:
“Access to Information
“The Board agrees to furnish to the Association, upon request, all available information concerning the financial resources of the district including but not limited to: Annual financial reports and audits, register of certified personnel, tentative budget requirements and allocations, agenda and minutes of all Board meetings, treasurer’s reports, census and membership data, names and addresses of all teachers, salaries paid thereto and educational background and such other information as will assist the Association in developing intelligent, accurate, informed and constructive programs on behalf of the teachers and their students together with information which may be necessary for the Association to process any grievance or complaint.”
We have concluded that the teachers organization is entitled to this information as a matter of right. This information is essential to enable the NEA to competently represent its members in negotiations. One of the principal concerns to the teachers is wages, specifically listed as mandatorily negotiable in 72-5413(l). Without access to information concerning the district’s financial resources, the associations’ ability to effectively negotiate wages would be significantly impaired. Furthermore, this information should be considered public information available to interested citizens! We hold that access to information as to the district’s financial resources, including the specific matters mentioned in the proposal, is not negotiable at all, for the teachers association is entitled to the information as a matter of right.
The final item proposed under association rights is a proposal for the exclusivity of rights as follows:
“Exclusive Rights
“The rights granted to the Association shall not be granted or extended to any other organization claiming to represent employees of the district.”
It should be noted that exclusive representation by an organization is provided for by K.S.A. 1979 Supp. 72-5415 and K.S.A. 72-5416. A school board is only obligated to recognize a teachers’ association for negotiation purposes under K.S.A. 1979 Supp. 72-5423. We have concluded that the subject of exclusivity has been preempted by statute and, therefore, is not a subject to be considered as mandatorily negotiable. On this item, the trial court is affirmed.
The judgment of the district court is affirmed in part and reversed in part, in accordance with the conclusions set forth in this opinion. | [
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The opinion of the court was delivered by
Miller, J.:
The validity of three statutes governing fire and police pensions is at issue in this case. The trial court held all three sections, K.S.A. 1977 Supp. 13-14a02, and K.S.A. 1977 Supp. 12-5004 and 12-5005, as applied to the plaintiffs, unconstitutional under the contract clause of the United States Constitution, art. I, § 10. Appeal was taken directly to this court, as authorized by K.S.A. 1979 Supp. 60-2101(b).
The plaintiffs are employees of the defendant City of Topeka. Richard Singer and Alan Warner are employed as firemen; Dennis Perkins and Walter Kuehl are employed as policemen. They brought this declaratory judgment and injunction action against the City of Topeka, challenging the constitutionality of statutory changes in the pension laws. A chronological statement of the stipulated facts, and of the statutory background, is necessary to an understanding of the issues.
On July 1, 1945, Laws of Kansas, 1945, ch. Ill, codified as K.S.A. 13-14a01 et seq., became effective. The act requires cities of the first class, including Topeka, to establish separate pension funds for firemen and for policemen. Under K.S.A. 13-14a02, 3% of the monthly salary of each policeman and fireman is paid into the respective pension fund. The proceeds of all unclaimed lost or stolen property, and all gifts or bequests designated for that purpose, are divided and credited to the pension funds. The cities are directed to levy an annual tax of not more than one mill for each fund, to maintain each at the level necessary to pay anticipated benefits for the ensuing year, and to maintain a reserve of not more than $50,000 in each fund. Local boards are created to administer each fund and to invest the reserves. Each employee is required to pay a “membership fee” of $5.00, which is credited to the appropriate pension fund. Specific disability and retirement benefits are fixed by the act.
The City of Topeka established pension funds for its firemen and for its policemen when the 1945 act became effective. The four plaintiffs were thereafter hired by the City as firemen or policemen. Singer has been employed as a fireman since April 1, 1955, Warner since September 18, 1961. Perkins has been a policeman since July 1, 1966, Kuehl since July 16, 1966. Each paid the membership fee, each had 3% of his monthly salary deducted and credited to the appropriate retirement fund, and each was covered by the local retirement plan mandated by K.S.A. 13-14a01 et seq. None of the Topeka firemen or policemen are covered by social security.
In 1961 the Kansas Public Employees Retirement System, KPERS, was established. See K.S.A. 74-4901 to -4946, as amended. In 1965, the Kansas Police and Firemen’s Retirement System, KP&F, was created as a division of KPERS. K.S.A. 74-4951 et seq. One of the sections of that act, K.S.A. 74-4954, gives the cities an option, exercisable by action of the governing body, to become a “participating employer” and to join the KP&F system with regard to its policemen, firemen, or both, as of the first day of January of any year after the effective date of the act. The cities may join only as to policemen and firemen employed on or after the effective date of joinder, or the cities may join as to persons employed immediately prior to and on the entry date. If all city policemen and firemen are not included initially, the city may apply to extend coverage to other groups at a later date. The act requires participating KP&F employers to withhold 7% from the gross pay of each covered employee not also covered by social security, and to remit such deductions to KPERS. K.S.A. 74-4965. Disability, death, and retirement benefits are fixed by the act.
The City of Topeka elected, in 1966, to become a participating member of KP&F as of January 1, 1967, as to all police and firemen employed on or after that date. All police and firemen hired before January 1, 1967, remained under the local plan; those persons including plaintiffs, continued to contribute 3% of their salaries to the plan.
The 1976 legislature amended K.S.A. 13-14a02, -14a05, -14a06, and -14a07, and increased the required employee contribution from 3% to 7% for those police and firemen who were still under local pension plans. The amendments became effective on January 1, 1978. No additional disability, death, or retirement benefits were granted to the covered employees, except for a modification of the outside income allowed to pensioners. K.S.A. 1977 Supp. 13-14a08. Other 1976 legislation, K.S.A. 1977 Supp. 12-5001 to -5007, inclusive, did, however, require the cities to set up actuarially sound plans; the $50,000 reserve fund limitation was repealed.
The original class action petition in this case was filed on December 30, 1977. It alleged that the local plan initiated by the City under the 1945 act was used as an inducement to attract and retain qualified fire and police officers; that the plan was a contractual obligation between the City and its employees; and that the 1976 act, mandating increased contributions from the employees without providing increased benefits, infringed the employees’ contractual rights and was in violation of art. 1, § 10, clause 1, and the Fourteenth Amendment of the United States Constitution. Plaintiffs sought to represent the class, consisting of about 209 Topeka policemen and firemen who are members of the local plan. They asked the court to determine that this is a proper class action under K.S.A. 60-223; to restrain and enjoin the City from withholding 7% of the monthly salaries of the named plaintiffs and the class they represent; and to declare the 1976 amendments unconstitutional.
A temporary restraining order was entered by the trial court on December 30, 1977, but that order was dissolved on January 12, 1978, on which date, by stipulation of the parties, the City was ordered to withhold 7% of plaintiffs’ and the class’s salaries, and to retain those funds as identifiable so that in the event the 1976 amendments were declared unconstitutional the excess over 3% is to be returned to plaintiffs and to the class with interest equivalent to the then prevailing rate on passbook savings at savings and loan associations in Topeka, Kansas. That order remains in effect.
The City deducted 7% from the paychecks issued to plaintiffs and the class in January, 1978, which checks were in payment of salaries earned partly in December, 1977, and partly in 1978. 7% has been deducted from each salary payment since that date.
On July 18, 1978, the City of Topeka, by resolution, elected to extend its participation in KP&F effective January 1, 1979, to include coverage for all Topeka firemen and policemen, including those employed prior to January 1, 1967, who were under the local plans. This extension of coverage is authorized by K.S.A. 1977 Supp. 74-4954. The effect of this action by the City is to abolish the local plans and the local boards created to administer them, to cause all pension reserves held locally to be transferred to KPERS, and to transfer all administration of the plans from local to state authorities, all as provided by K.S.A. 1977 Supp. 12-5004. A further effect of this action by the City was to give to plaintiffs and to the class an election to become full members of the KP&F system, by filing written elections to do so on or before January 1, 1979; failure to file such an election is considered an election not to become a full member of the KP&F system. K.S.A. 1977. Supp. 12-5003(o); K.S.A. 1977 Supp. 74-4955. Those who fail to file an election become “special members” of KP&F. K.S.A. 1977 Supp. 12-5005(a). Special members continue to be entitled to the same pension and other benefits provided by the local plans. K.S.A. 1977 Supp. 12-5005(c). Special members become subject to the 7% contribution requirements of K.S.A. 1977 Supp. 12-5005(h); full members are required to contribute 7% under K.S.A. 1977 Supp. 74-4965.
A second amended petition was filed on September 15,1978; in addition to the claims included in the original petition was a challenge to the City’s action of July 18, 1978. The plaintiffs did not elect to become full members of the KP&F system; thus they became “special members” with no increase in benefits but with an increased contribution rate of from 3% to 7%. The second amended petition also sought return of the deductions above 3% from the salaries earned in December, 1977.
The parties stipulated that “[s]ince January 1, 1978, there have been no changes in the benefits available to the members of the Local Plans”; that “[m]embers of the Local Plans who fail to elect pursuant to K.S.A. 1977 Supp. 74-4955 will become ‘special members’ of KP&F retaining the benefits of the Local Plans, but having their contribution rate increased from 3% to 7% of their salaries”; “[t]hat the plaintiffs do not intend to elect to become members of KP&F”; and that “[s]ince the original establishment of the Local Plans, pursuant to K.S.A. 13-14a01 et seq. there has been no increase in the benefits provided by said plans, provided, however, the City does not hereby waive its allegation that the statutorily required actuarial soundness of local plans will be a benefit to the members.” They further stipulated that plaintiffs have never been covered by social security.
The matter came on for trial on October 4, 1978. The parties relied upon the stipulations; no further evidence was offered. Counsel fully argued and briefed the issues. The trial judge prepared a comprehensive memorandum decision, filed December 12, 1978. The court’s conclusions were as follows:
“In summary, the Court holds as follows:
“1. Pension plans between the municipality of the City of Topeka and its firemen and policemen are contracts and not mere gratuities of the employer.
“2. Plaintiffs have acquired sufficient vested contractual interests to challenge the constitutional validity of the legislative and municipal ordinance enactments raising their contributions to the local pension plan, in the first instance, and abrogating such local plan and converting it into the State KP&F pension fund.
“3. Reasonable modifications to pension plans may be made by municipalities, but only if those modifications provide any additional burdens be offset with correlative benefits to the employees covered by the plan.
“4. Under the stipulated facts before the Court, no offsetting benefits have been provided in the modifications of plaintiffs’ pension plan sufficient to compensate plaintiffs for the additional burdens imposed by the modifications.
“5. No financial exigency or other emergency has been proved by plaintiffs sufficient to justify the exercise of the extraordinary police power of the State to abrogate the earned benefits of the firefighters and policemen who constitute the plaintiffs in this cause.
“Through summer’s heat and winter’s icy blasts, from tall buildings ablaze to dark alleys ringing with gunshots, the City of Topeka has required the services of the plaintiffs herein. As a partial inducement for the acquisition of these often heroic and rarely appreciated contributions to the public safety and welfare the City of Topeka offered to its firemen and policemen a modest pension plan to provide for their disability, death and old age, should they be so fortunate as to attain it. It would take a compelling reason indeed, for this Court to hold that the City of Topeka may, with the stroke of the pen, whether encouraged by the State Legislature or not, renege on its contractual commitments to these men and women who have not reneged on their commitments to our citizens.
“It is therefore the judgment of this Court that K.S.A. 13-14a02 and K.S.A. 1977 Supp. 12-5004, -5005 as applied to the plaintiffs in this cause contravene Article 1, Section 10, Clause 1 of the Constitution of the United States and the Fourteenth Amendment thereto and as such are void and of no force and effect. Defendants are herewith restrained and enjoined from the abolition of the firemen and policemen local pension plans in the manner proposed and are herewith ordered and directed to refrain from withholding more than three percent from the monthly salaries of the members of such local plans and are herewith required to return to plaintiffs any such funds heretofore withheld, together with interest earned thereon. If the parties are unable to agree concerning the membership of the class which plaintiffs purport to represent herein, this Court will order a hearing for such purpose and resolve those issues.”
In January, 1979, the trial court held a hearing and certified two classes. Class I consists of all Topeka firemen and policemen employed at any time during the year 1978 who were then active members of the local police or fire pension plan. Class II includes all Topeka firemen and policemen employed on December 31, 1978, who were then active members of the local police or fire pension plan, and who do not intend to become full members of KP&F pursuant to K.S.A. 1977 Supp. 74-4955. The court held that its ruling that K.S.A. 1977 Supp. 13-14a02 is void, and requiring the return of funds in excess of 3% of monthly salaries previously withheld, is applicable to members of class I, and that its holding that K.S.A. 1977 Supp. 12-5004 and -5005 are unconstitutional, and enjoining the City from abolishing the local plans and restraining it from withholding more than 3% of monthly salaries thereafter is applicable to the members of class II. There is no dispute as to the class aspect of this case.
The City argues but one issue in its brief: Did the trial court err in its judgment that K.S.A. 1977 Supp. 12-5004, 12-5005, and 13-14a02 contravene the contract clause and the due process clause of the United States Constitution? In order to resolve this issue we must determine:
(1) whether governmental pension plans in this state are mere gratuities, subject to unilateral change at will, or whether they are a form of contract between employer and employee;
(2) whether, at the time this action was commenced, plaintiffs and the classes possessed vested contract rights which were subject to the protection of the contract clause;
(3) whether a governmental employer may unilaterally change or modify a pension plan, and if so, within what limitations; and
(4) whether the challenged statutes impose a substantial detriment on plaintiffs and the classes, without correlative benefit.
The earliest Kansas case dealing with pensions of governmental employees appears to be State, ex rel., v. Board of Education, 155 Kan. 754, 129 P.2d 265 (1942). In 1911, a teachers’ retirement law was enacted. In 1935, the legislature repealed the 1911 law and enacted a new retirement law for teachers. The new law raised the teacher’s contribution from llk% to a maximum of 6%, and it raised from 15 to 20 the number of years one must teach before becoming eligible to retire. Each teacher was granted the right to elect not to come within the new act by filing a written request with the board of education, asking for exemption. The new act was challenged in an action brought by the attorney general, who contended that the rights of the teachers had become fixed and that they had vested rights under the 1911 act.
None of the teachers had “opted out.” This court found it unnecessary to determine whether the teachers had vested interests in the retirement fund under the 1911 act since none had requested exemption and thus all were eligible for benefits under the new act. The court held that even if there was a contractual relationship, the failure to file requests for exemption manifested assent to participate in the new plan; the old contract was abandoned and a new one substituted with the assent of the parties.
In its discussion, the court said:
“It is generally held that a pension granted by the public authorities is not a contractual obligation, but a gratuitous allowance in the continuance of which the pensioner has no vested right. By the great weight of authority the fact that a pensioner has made compulsory contribution to the fund does not give him a vested right in the pension. (See Annotations 54 A.L.R. 943; 98 A.L.R. 505; 112 A.L.R. 1009; 137 A.L.R. 249.)” 155 Kan. at 757.
The quoted language, though dicta in that case, was not followed in our later decisions and is not the law of this state. It is expressly disapproved.
In Shapiro v. Kansas Public Employees Retirement System, 216 Kan. 353, Syl. ¶ 1, 532 P.2d 1081 (1975), we said:
“State retirement systems create contracts between the state and its employees who are members of the system.”
This is the rule followed in most recent cases on the subject, and seems to us the more enlightened view. A public employee, who over a period of years contributes a portion of his or her salary to a retirement fund created by legislative enactment, who has membership in the plan, and who performs substantial services for the employer, acquires a right or interest in the plan which cannot be whisked away by the stroke of legislative or executive pen, whether the employee’s contribution is voluntary or mandatory.
We recognize that this is an area upon which the courts are not in accord. Some courts have held pensions to be mere gratuities, changeable in whole or in part at will. See Pennie v. Reis, 132 U.S. 464, 33 L.Ed. 426, 10 S.Ct. 149 (1889); Annot., Vested Right of Pensioner to Pension, 52 A.L.R.2d 437; and Cohn, Public Employee Retirement Plans - The Nature of the Employees’ Rights, Ill. L.F. 32 (1968). Some have held pension plans to create inflexible rights. See Yeazell v. Copins, 98 Ariz. 109, 402 P.2d 541 (1965). In at least one instance the court found neither gratuity nor contract but decided the issues by relying upon legislative history. Spina v. Consolidated Police, etc., Pension Fund Com., 41 N.J. 391, 197 A.2d 169 (1964).
We adopted the contract theory in Shapiro, finding that the legislature intended to impose duties upon KPERS which were legally enforceable. We adhere to that determination.
Did plaintiffs and the classes they represent have vested contract rights which could not be altered unilaterally, and which were within the protection of the contract clause, applicable to the states under the Fourteenth Amendment? We hold that they did.
Plaintiff Singer was over 49 years of age and had over 22 years of continuous service with the Topeka Fire Department at the time the petition was filed. He passed his 23d service anniversary and his 50th birthday before trial. Under the local plan, effective when he went to work and throughout his years of service, he is eligible for retirement. Warner was 39 years of age and had over 16 years of service when this action was commenced; Kuehl was 39 and had 11 years of service; and Perkins was 34 and had 11 years of service. Each had contributed 3% of his salary throughout to the local pension plan. The parties stipulated that one of the inducements for each of the plaintiffs to accept and remain in employment with the City fire or police department was the pension plan of which each was a member as a result of that employment.
Jurisdictions adopting the contract theory vary greatly as to the time of vesting and the restrictions upon amendment after commencement of employment. Arizona, in Yeazell v. Copins, 98 Ariz. 109, adopts a strict contract theory under which all elements of the contract vest upon employment and are not subject to future change without consent of the employee.
Other courts hold vesting does not occur until retirement. Tait v. Freeman, 74 S.D. 620, 57 N.W.2d 520 (1953), rejects the contention that a right to a continuing pension system exists where the employee has fulfilled the service requirement but has not reached retirement age.
An earlier date for vesting is recognized in Arkansas. Amendments making plaintiff ineligible for benefits subsequent to having fulfilled his service requirement but prior to his actual retirement were found an impairment of contract in Jones v. Cheney, 253 Ark. 926, 489 S.W.2d 785 (1973). The court notes that the plan under review was funded entirely by contributions from the employee, making it more in the nature of an annuity. Arkansas relies upon a similar Pennsylvania case, Hickey v. Pittsburgh Pension Board, 378 Pa. 300, 106 A.2d 233 (1954). See also Dorsey v. State ex rel. Mulrine, 283 A.2d 834 (Del. 1971).
California and some other jurisdictions hold that a contract right to a pension arises upon membership in the plan and the furnishing of services, but reasonable modification prior to retirement for the purpose of keeping the system flexible and accommodating changing conditions are allowed. Allen v. City of Long Beach, 45 Cal. 2d 128, Syl. ¶ 1, 287 P.2d 765 (1955); and see Annot., Vested Right of Pensioner to Pension, 52 A.L.R.2d 437, §§ 5 and 34.
Judge Bullock relied in part on the case of Miller v. State of California, 18 Cal. 3d 808, 135 Cal. Rptr. 386, 557 P.2d 970 (1977), in which the California Supreme Court, quoting from an earlier opinion, said:
“ ‘[A]n employee does not earn the right to a full pension until he has completed the prescribed period of service, but he has actually earned some pension rights as soon as he has performed substantial services for his employer.’ ” 18 Cal. 3d at 815.
We are convinced that the employee has vested contract rights prior to actual retirement. In the case before us, Singer, having worked as a city fireman and having contributed a part of his salary to the plan for more than 20 years, and being eligible to retire and to receive the benefits of that status, has an actual, bona fide, and vital interest in the plan.
We are not convinced that all elements of the contract vest upon the first day of employment, which appears to be the Arizona rule. Continued employment over a reasonable period of time during which substantial services are furnished to the employer, plan membership is maintained, and regular contributions into the fund are made, however, cause the employee to acquire a contract right in the pension plan. Here all plaintiffs have been employed and have served the City for many years; all are members of the local plan; and all have contributed to the fund the required percentage from their salaries over the period of employment. Their rights are substantial and are vested and subject to the protection afforded by the contract clause of the United States Constitution, art. I, § 10, which provides:
“No State shall . . . pass any . . . Law impairing the Obligation of Contracts . . .
Contracts of municipalities are within the ambit of that clause. See Flanigan v. Leavenworth Recreation Commission, 219 Kan. 710, 715, 549 P.2d 1007 (1976), citing as the foundation case for that principle Broughton v. Pensacola, 93 U.S. 266, 23 L.Ed. 896 (1876).
New members were not accepted into the local plan after 1966, and therefore all members of both classes had been employed as city policemen or firemen for over 11 years when this action was filed. We conclude that plaintiffs and the designated classes possessed vested contractual rights at the time this action was commenced.
Next, we consider whether the state or a municipality may unilaterally change or modify a pension plan in which employees hold vested contract rights, and whether there are limitations upon such action. Yeazell v. Copins, 98 Ariz. 109, states the Arizona rule: No change in the plan may be made by the state without the consent of the employee.
The California rule, set forth in the Long Beach case and noted above, is that “reasonable modifications” may be made prior to retirement for the purposes of keeping the system flexible and of accommodating changing conditions while maintaining the integrity of the system. As to the reasonableness of changes, the court says:
“To be sustained as reasonable, alterations of employees’ pension rights must bear some material relation to the theory of a pension system and its successful operation, and changes in a pension plan which result in disadvantage to employees should be accompanied by comparable new advantages.” 45 Cal. 2d at 131.
Long Beach held invalid legislation increasing the employee’s contribution from 2% to 10% of salary, with no increased benefits and no showing that the city would be unable to meet its obligations under the existing plan without the increased contribution. Abbott v. City of Los Angeles, 50 Cal. 2d 438, 326 P.2d 484 (1958), held invalid an amendment making pension benefits fixed rather than flexible and based upon changes in salary scales. Wisley v. City of San Diego, 188 Cal. App. 2d 482, 10 Cal. Rptr. 765 (1961), invalidated increases in employee contributions without corresponding benefits. City of Downey v. Board of Administration, 47 Cal. App. 3d 621, 121 Cal. Rptr. 295 (1975), approved amendments increasing employee contributions and also increasing benefits, reducing the mandatory retirement age, and granting benefits to surviving spouses.
In Abbott, the court specifically rejected the contention that the overall benefit be balanced against the overall detriment. The court said:
“[I]t is by advantage or disadvantage to the individual employes whose already earned and vested pension rights are involved that the validity of attempted changes in these rights depends, and benefits subsequently obtained by other employes cannot operate to offset detriments imposed on those whose pension rights have theretofore accrued.” 50 Cal. 2d at 453.
We do not adopt the balancing test of Abbott; instead, we hold that, insofar as the rights of active employees in and to pension plans are concerned, the reasonableness of legislative changes is to be measured by the advantage or disadvantage to the affected employees as a group or groups; validity of change is not dependent upon the effect upon each employee.
The California rule, as set forth in Long Beach, 45 Cal. 2d 128, is logical and fair, and we adopt it. The rule is set out at length above and need not be repeated in full. We hold that the state or a municipality may make reasonable changes or modifications in pension plans in which employeés hold vested contract rights, but changes which result in disadvantages to employees must be accompanied by offsetting or counterbalancing advantages.
Do the challenged statutes impose a substantial detriment on plaintiffs and the classes without correlative benefit? Amendments which more than double employee contributions without increasing benefits do just that, and run afoul of the rule; not all changes, however, do so. We must therefore examine the statutes and their respective effects on the plaintiffs and the classes..
K.S.A. 1977 Supp. 13-14a02 and -14a06 raised the contribution rate of plaintiffs and both classes during the calendar year 1978. No offsetting benefits were provided. Clearly K.S.A. 1977 Supp. 13-14a02 and -14a06 are unconstitutional as applied, for those statutes impair the contract rights of the plaintiffs and the classes.
We have not overlooked the City’s claim that the actuarial soundness of the local plan, mandated by K.S.A. 1977 Supp. 13-14a02, is advantageous to the plaintiffs. As the trial court pointed out, there was no evidence that the City will not be able to meet its obligations in the future, no evidence that plaintiffs’ pensions are in jeopardy, no evidence that plaintiffs would receive any benefit from an actuarially sound system which plaintiffs would not otherwise receive. We agree that there were valid reasons for the legislature to require pension plans to be actuarially sound; but the change is not shown to be a benefit to these plaintiffs. Similarly, a proposed increase in member contributions without benefit increases was held presumptively invalid by the Supreme Judicial Court of Massachusetts in Opinion of the Justices, 364 Mass. 847, 303 N.E.2d 320 (1973), when it was not shown that the proposed increase was necessary to the successful functioning or integrity of the plan.
K.S.A. 1977 Supp. 12-5004 abolishes the local plan, abolishes the local board which administered the plan, directs that all funds and assets be transferred to KPERS, and authorizes KPERS to administer the fund and perform all functions formerly performed by the local board, on or after the date on which the City affiliates with KP&F. This transfer has been effected as of January 1, 1979; all retired Topeka firemen and policemen now receive their pensions from KPERS, and all special and full members’ contributions are paid by the City to KPERS. The City also pays its contribution to KPERS rather than to the local board.
The plaintiffs have rights which may not be impaired to the pensions which were held out to them during their first 11 years of employment, but we see no reason why legislation cannot change the designation of the board which is to administer the plan. Whether administration is handled by the original local board, by the city treasurer, the county treasurer, a state board, or the trust department of a local bank, is not a vital part of the contract so long as sufficient funds are provided and the promised pensions are paid. We conclude that the change in administration of the pension plan is a reasonable modification which does not impair the integrity of the system; it is simply a reorganization, a housekeeping change, well within the legislative prerogative. 73 C.J.S., Public Administrative Bodies and Procedure § 23; 81A C.J.S., States § 82; 63 Am. Jur. 2d, Public Officers and Employees §33.
K.S.A. 1977 Supp. 12-5005(fe) requires the City to deduct 7% from the salaries of the plaintiffs and of the members of class II, commencing on the date the employees became “special mem bers” of KP&F — in this case, January 1, 1979. As the parties stipulated, no added benefits accrue to the employees. This is a modification of a vital element of the original plan, disadvantageous to the employees and with no offsetting advantages. We hold that K.S.A. 1977 Supp. 12-5005(b), as applied to the plaintiffs and the members of class II, is an unconstitutional impairment of contract rights.
In summary, we hold that plaintiffs and both classes cannot be subject to increased deductions without offsetting benefits, and that K.S.A. 1977 Supp. 13-14a02 and -14a06 as applied to plaintiffs and both classes, and K.S.A. 1977 Supp. 12-5005(fi) as applied to plaintiffs and class II, are unconstitutional. It follows that the sums in excess of 3% of wages which the City withheld must be refunded, along with the agreed interest. Plaintiffs and class II may not be required to contribute more than 3% of their salaries in the future, under existing law. They have a continuing conditional entitlement to the benefits provided by the local plan, payable upon death, injury, or retirement. Payment will now be made by KPERS, rather than by the local board.
We hold further that K.S.A. 1977 Supp. 12-5004, however, is not invalid. The local board has been abolished and its function transferred to KPERS; the City will hereafter contribute to KPERS, as required by law; and plaintiffs and class II, together with all retired former members of the local plan, will continue as “special members” of KP&F, and will receive the benefits to which they are or shall become entitled from that agency or its parent, KPERS.
The judgment of the district court that K.S.A. 1977 Supp. 13-14a02 and 12-5005 are unconstitutional as applied is affirmed; the judgment that K.S.A. 12-5004 is unconstitutional is reversed; and the case is remanded with directions to enter judgment in conformity with this opinion. | [
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The opinion of the court was delivered by
Prager, J.:
This is an action brought by a Wichita physician against several attorneys seeking to recover damages for the wrongful use of civil proceedings, commonly described as an action for malicious prosecution of a civil action. This action was the result of a prior civil malpractice action filed on April 1, 1976, in the district court of Sedgwick County. That action was case No. D-36 241, entitled Van Nover, et al. v. Wesley Medical Center, et al. R. A. Nelson, M.D. was one of several doctors named as defendants in that suit. The petition in that case was filed by the defendants Vern Miller, Fred Phelps, Chartered, and Adler, Barish, Daniels, Levin, and Creskoff, a law firm of Philadelphia, Pennsylvania, as attorneys for the plaintiffs.
The medical malpractice petition alleged in substance that the Van Novers had been damaged by negligent treatment afforded Debbie Van Nover by the defendants, including R. A. Nelson. Specifically, it was alleged that Debbie Van Nover, while pregnant with her son, Christopher, was surgically treated by the physicians in the performance of a Dilation and Curettage (D & C) upon her uterus without a prior examination for pregnancy. It was alleged that as a result the undetected fetus (Christopher) was injured. It was also contended that the decision to deliver Christopher Van Nover by Caesarian section was premature, and, therefore, constituted negligence on the part of the treating physicians. In that action, the Van Novers claimed damages against Wesley Medical Center and the five physicians in the amount of $5,000,000 actual damages and $10,000,000 punitive damages. On October 10, 1977, the malpractice action was dismissed without prejudice as to defendant Dr. Nelson. In the order of dismissal, counsel stipulated that if, after further discovery and for good cause the plaintiffs would seek to rejoin Dr. R. A. Nelson, M.D. as a defendant in the case, the bar of the statute of limitations (K.S.A. 60-518) would not be raised against such rejoinder if made more than six months from the entry of the order of dismissal. Thereafter, extensive discovery was conducted by counsel for the remaining parties in the case. On April 18, 1978, summary judgment was granted in favor of all of the remaining defendants on their motion. The trial judge found that the actions of the defendants, upon which the Van Novers had based their claims, dealt only with questions of medical judgment, thereby precluding liability for negligence. That summary judgment was later appealed to the Kansas Court of Appeals, and was affirmed in an unpublished opinion filed June 29, 1979. A petition for review was thereafter denied.
Following the entry of summary judgment in the medical malpractice action, Dr. Nelson filed his action in the district court of Shawnee County against these defendants who were the attorneys of record for plaintiffs in the prior action. In his amended petition filed May 9, 1978, Dr. Nelson set forth two separate claims. The first claim sought recovery of damages from the attorneys on the theory of malicious prosecution of a civil action. The second claim sought recovery of damages on a theory of simple negligence. Counsel for Dr. Nelson commenced the discovery process in this case by filing requests for admissions, interrogatories, and requests for the production of documents. All of this discovery was opposed by defendants and was never answered by defendants. Thereafter, all of the defendant attorneys filed motions to dismiss pursuant to K.S.A. 60-212(b)(6). On June 5, 1978, the district judge sustained the motions to dismiss Dr. Nelson’s claims. This appeal was taken by Dr. Nelson, seeking to overturn the dismissal of his claims against the various defendant attorneys.
In dismissing the plaintiff’s claim, the district court had before it a rather scanty record consisting solely of four documents. First was the plaintiff’s amended petition filed in this case. In the first claim of the amended petition, Dr. Nelson alleged in substance that he is a practicing physician living in Wichita and that each of the defendants are attorneys at law. He further alleged that on April 1,1976, the defendants, as attorneys, caused a petition to be filed in the district court of Sedgwick County on behalf of the plaintiffs, Van Novers, and that R. A. Nelson, M.D., was one of the defendants in that cause. Because an issue has been raised as to the sufficiency of the allegations of the petition, certain paragraphs of the plaintiff’s first claim will be set forth verbatim:
“IV. In the aforementioned petition, the plaintiff was sued for five million dollars actual damages and ten million dollars punitive damages. It was further alleged that the plaintiff was guilty of negligence, gross and wanton negligence and recklessness in his medical treatment of Christopher Allen Van Nover. Said allegation was and is false.
“V. It was further alleged in the aforementioned petition that the plaintiff caused severe, permanent and progressive worsening brain damage to Christopher Allen Van Nover. Said allegation was and is false.
“VI. It was further alleged in the aforementioned petition that plaintiff caused Christopher Allen Van Nover a lifetime of shame embarrassment and indignity. Said allegation was and is false.
“VII. At the time the aforementioned petition was filed it was known or should-have been known by defendants that all of the allegations made against the plaintiff, were false.
“VIII. The defendants instituted the medical malpractice proceeding against this plaintiff without probable cause, and with malice.
“IX. The defendants continued to prosecute the action against this plaintiff without probable cause, and with malice.
“X. The action brought and prosecuted by the defendants, jointly and separately, against this plaintiff, terminated in favor of the plaintiff on the 10th day of October, 1977.
“XI. As a direct result of the malice of the defendants, jointly and separately, the plaintiff has been damaged.
“Wherefore plaintiff prays for judgment against the defendants in an amount in excess of ten thousand dollars ($10,000).”
In his second claim the plaintiff, Nelson, incorporated by reference all of the allegations of his first claim and then proceeded to allege as follows:
“II. Before filing the aforementioned petition against this plaintiff, defendants negligently failed to investigate the claim. Said negligence was a departure from standard approved legal practice.
“III. Defendants continued to prosecute a claim against this plaintiff with full knowledge that the claim against this plaintiff was unjust and totally without merit. Such action was negligent and a departure from standard approved legal practice.
“IV. Filing and continued prosecution of an unjust and meritless claim by the defendants against this plaintiff was done with the knowledge that it would cause and was causing damages to the plaintiff.
“V. As a direct result of the negligence and departure from standard approved legal practice of the defendants, the plaintiff has been damaged.
“Wherefore plaintiff prays for judgment against the defendants in an amount in excess of ten thousand dollars ($10,000).”
At the time the district court dismissed Dr. Nelson’s claims, it also had before it the petition filed in the Sedgwick County malpractice case and the order dismissing the case without prejudice as against Dr. Nelson, dated October 10, 1977. The only other evidentiary matter before the district court at the time was the memorandum decision in the Sedgwick County malpractice action granting summary judgment in favor of the remaining defendants. In that memorandum decision, Judge Paul L. Thomas of the Sedgwick County District Court noted that the only negligent act indicated by discovery on the part of any defendant was the performance of a premature Caesarian section and that nothing in the testimony of the witnesses connected the defendant Nelson to any of the plaintiffs’ claims. The attorneys for the plaintiffs in that case agreed with those conclusions. In addition, in his memorandum decision, Judge Thomas held, as a matter of law, that there was no evidence to show that any ot the medical defendants had departed from established medical standards in performing the Caesarian section.
At the time Judge Michael A. Barbara sustained the motion to dismiss in this case, he noted that the defendants’ motions were essentially motions for summary judgment. In referring to the malicious prosecution claim, he observed that, before Dr. Nelson could proceed, he was required to properly allege and show that the defendants, as attorneys for the Van Novers, knew that the malpractice action was a groundless claim, knew that there was no basis for the claim, and filed it solely to harass Dr. Nelson. The court held, as a matter of law, that no malice or lack of probable cause existed in the medical malpractice action and, therefore, the malicious prosecution claim should be dismissed. It was further held that Dr. Nelson could not maintain his second claim against the defendant attorneys on a theory of simple negligence, since they had not been employed by Dr. Nelson as his attorneys. In addition, Judge Barbara indicated that, as a matter of law, the dismissal of the previous malpractice action without prejudice was not a termination in favor of Dr. Nelson. From the order of dismissal, Dr. Nelson has appealed to this court.
There are two basic issues raised on this appeal. The first issue is whether, on the basis of the record before it, the district court was justified in dismissing the plaintiff’s first claim based upon the theory of malicious prosecution of a civil action. The second issue is whether the district court was justified in dismissing the plaintiff’s second claim based upon a theory of simple negligence. In order to determine the appeal, we must consider and determine each issue separately.
At the outset it would be helpful to review the basic principles of law which are to be applied in an action for malicious prosecution of a civil action. This state has long recognized that a cause of action may exist based upon the malicious prosecution of a prior civil action. Some of the basic principles are as follows:
(1) The elements necessary to be alleged and proved in order to maintain an action for malicious prosecution of a civil action are the same as those required to sustain an action for a malicious prosecution of a criminal action. Braun v. Pepper, 224 Kan. 56, 59, 578 P.2d 695 (1978); Investment Co. v. Burdick, 67 Kan. 329, 72 Pac. 781 (1903).
(2) To maintain an action for malicious prosecution of a civil action the plaintiff must prove the following elements:
(a) That the defendant initiated, continued, or procured civil procedures against the plaintiff.
(b) That the defendant in so doing acted without probable cause.
(c) That the defendant acted with malice, that is he acted primarily for a purpose other than that of securing the proper adjudication of the claim upon which the proceedings are based.
(d) That the proceeding terminated in favor of the plaintiff.
(e) That the plaintiff sustained damages. See Restatement (Second) of Torts § 674 (1976); Thompson v. General Finance Co., Inc., 205 Kan. 76, 468 P.2d 269 (1970); Investment Co. v. Burdick, 67 Kan. at 337; Malone v. Murphy, 2 Kan. *250 (1864).
(3) In addition to the initiation of the prior action, it is sufficient if it is shown that the defendant continued or procured the filing of the action. To be liable, it is not necessary that the defendant actually be a party to the prior civil action. The attorney who represented the plaintiff in the prior action may be held liable. Maechtlen v. Clapp, 121 Kan. 777, 250 Pac. 303 (1926). Likewise, a conspirator who procured the filing of the prior action may be held liable. Vaughan v. Hornaman, 195 Kan. 291, 403 P.2d 948 (1965). A person may also be held liable for the wrongful continuance of the original proceeding. Barnes v. Danner, 169 Kan. 32, 216 P.2d 804 (1950).
(4) In order for a person to be liable for wrongful use of civil proceedings it must be shown that the person was affirmatively active in the initiation or continuance of the prior action. Barnes v. Danner, 169 Kan. at 35; A.T. & S.F. Rld. Co. v. Watson, 37 Kan. 773, 15 Pac. 877 (1887); Restatement (Second) of Torts § 674.
(5) Where a party makes an unlawful demand against another and maliciously and oppressively uses the machinery of the courts and the process of the law as well as other measures in an endeavor to enforce the payment of such demand, the injured party is entitled to recover the loss and damage resulting from such wrongdoing. It is not necessary to prove the existence of a conspiracy. Stalker v.Drake, 91 Kan. 142, 136 Pac. 912 (1913).
(6) The premature commencement of a civil action may be made the foundation of an action for malicious prosecution. Bratton v. Exchange State Bank, 129 Kan. 82, Syl. ¶ 5, 281 Pac. 857 (1929).
(7) A cause of action for malicious prosecution of a civil action may be alleged in general language in a petition, so long as the essential elements are set forth. See for example, Vaughan v. Hornaman, 195 Kan. at 297. In this regard, it should be noted that K.S.A. 60-208 requires that a pleading contain only (1) a short and plain statement of the claim showing that the pleader is entitled to relief and, (2) a demand for judgment for the relief to which the pleader deems himself or herself entitled. Under Kansas notice pleading, there is no requirement that a petition state facts sufficient to constitute a cause of action. Rinsley v. Frydman, 221 Kan. 297, 301, 559 P.2d 334 (1977). It should also be noted that K.S.A. 60-209, covering the pleadings of special matters, does not contain any special pleading requirements applicable to actions for malicious prosecution.
(8) In order to maintain an action for malicious prosecution, the plaintiff must prove that the defendant initiated the proceedings of which complaint is made without probable cause. Carnegie v. Gage Furniture, Inc., 217 Kan. 564, 538 P.2d 659 (1975); Malone v. Murphy, 2 Kan. at *262. Probable cause for instituting a proceeding exists when there is a reasonable ground for suspicion, supported by circumstances sufficiently strong in themselves to warrant a cautious or prudent man in the belief that the party committed the act of which he is complaining. Barnes v. Danner, 169 Kan. at 36. See also for approval of the reasonable man rule, Carnegie v. Gage Furniture, Inc., 217 Kan. at 568. In cases of malicious prosecution, the inquiry as to want of probable cause is limited to the facts and circumstances as they appeared to defendant at the time the prosecution was commenced. PIK Civil 2d 14.31 (1978); Stohr v. Donahue, 215 Kan. 528, 527 P.2d 983 (1974); Thompson v. General Finance Co., Inc., 205 Kan. 76, Syl. ¶ 6; Messinger v. Fulton, 173 Kan. 851, 857, 252 P.2d 904 (1953); A.T. & S.F. Rld. Co. v. Watson, 37 Kan. 773, Syl. ¶ 3. If the facts are undisputed, the question of probable cause is one for the court to decide as a matter of law. Parli v. Reed, 30 Kan. 534, 2 Pac. 635 (1883). If the facts tending to establish the existence or want of existence of probable cause are in dispute, it becomes the duty of the trial court to submit the question to the jury. Thompson v. General Finance Co., Inc., 205 Kan. at 78, Syl. ¶ 15.
(9) Malice is an essential element of an action for malicious prosecution but it is not restricted to the personal hatred, spite, or revenge of the one who institutes the prosecution. It is enough if the prior action was instituted for any improper or wrongful motive. When a proceeding is intentionally instituted with any other motive than to bring a party to justice, it is in law a malicious prosecution. Foltz v. Buck, 89 Kan. 381, 385, 131 Pac. 587 (1913). A criminal prosecution is properly brought only to punish crime and to bring criminals to justice. To subject a person to liability for wrongful use of civil proceedings, the proceedings must have been initiated or continued primarily for a purpose other than that of securing the proper adjudication of the claim on which they are based. Any other purpose constitutes malice, as that term is used in civil actions for malicious prosecution. Restatement (Second) of Torts § 676, comment c, gives the following illustrations of situations in which civil proceedings may be said to have been initiated primarily for an improper purpose:
“c. There are numerous situations in which the civil proceedings are initiated primarily for an improper purpose. Some of them have been established as patterns and may be described in some detail. The following are illustrative:
“The first situation arises when the person bringing the civil proceedings is aware that his claim is not meritorious. Just as instituting a criminal proceeding when one does not believe the accused to be guilty is not acting for the proper purpose of bringing an offender to justice (see § 668, Comment b), so instituting a civil proceeding when one does not believe his claim to be meritorious is not acting for the purpose of securing the proper adjudication of his claim. One may believe that his claim is meritorious even though he knows that the decisions in the state do not sustain it if he believes that the law is potentially subject to modification and that this case may be a suitable vehicle for producing further development or change. He may believe that his claim is meritorious if he believes that the actual facts warrant the claim but recognizes that his chances of proving the faqts are meager. He cannot believe that the claim is meritorious, however, if he knows that it is a false one based upon manufactured or perjured testimony, or if he realizes that the adjudication will not be in his favor unless the court or jury is misled in some way. He is then abusing the general purpose of bringing civil proceedings and is not seeking a proper adjudication of the claim on which the civil proceeding is based.
“The second situation arises when the proceedings are begun primarily because of hostility or ill will. This is ‘malice’ in the literal sense of the term, which is frequently expanded beyond that sense to cover any improper purpose. Thus, if the purpose of the civil proceeding is solely to harass the defendant, it is frequently said that this amounts to malice. But it is not necessary to prove that the harassment was itself motivated by ill will.
“A third situation arises when the proceedings are initiated solely for the purpose of depriving the person against whom they are brought of a beneficial use of his property. An instance of this type occurs when the proceedings attacking the title to the land owned by the defendant are for the purpose not of adjudicating the title but of preventing the owner from selling his land. . . .
“A fourth situation arises when the proceedings are initiated for the purpose of forcing a settlement that has no relation to the merits of the claim. This occurs, for example when a plaintiff, knowing that there is no real chance of successful prosecution of a claim, brings a ‘nuisance suit’ upon it for the purpose of forcing the defendant to pay a sum of money in order to avoid the financial and other burdens that a defense against it would put upon him. A further instance occurs when the proceedings are based upon alleged facts so discreditable as to induce the defendant to pay a sum of money to avoid the notoriety of a public trial.
“A fifth type of situation arises when a defendant files a counterclaim, not for the purpose of obtaining proper adjudication of the merits of that claim, but solely for the purpose of delaying expeditious treatment of the original cause of action.
“In all of these situations, if the proceedings are also found to have been initiated without probable cause, the person bringing them may be subject to liability for use of wrongful civil proceedings.” pp. 462-463.
The existence of malice or wrongful purpose is ordinarily a question of fact for the jury. Walker v. Smay, 108 Kan. 496, 196 Pac. 231 (1921). The jury may infer malice (wrongful purpose) from the absence of probable cause but they are not bound to so infer it. Thompson v. General Finance Co., Inc., 205 Kan. at 78; Bratton v. Exchange State Bank, 129 Kan. 82, Syl. ¶ 3; Parli v. Reed, 30 Kan. at 537; Malone v. Murphy, 2 Kan. at *256.
(10) The advice of counsel, as to the institution of a criminal proceeding, sought and acted upon in good faith, will absolve one from damages for malicious prosecution; but only where all the facts known to the informant, and all which can be learned by a diligent effort to acquire information, have been laid before such counsel. Messinger v. Fulton, 173 Kan. at 855; Haines v. Railway Co., 108 Kan. 360, 195 Pac. 592 (1921); Drake v. Vickery, 81 Kan. 519, 520, 106 Pac. 290 (1910); Railroad Co. v. Brown, 57 Kan. 785, 48 Pac. 31 (1897). In McGarr v. Schnoor Cigar Co., 125 Kan. 760, 766, 266 Pac. 73 (1928), in an action to recover for malicious prosecution of a civil action, this court stated that in order for advice of counsel to be a defense, the advice must be acted upon in good faith, and only where all the facts known to the informant and all which can be learned by a diligent effort to acquire information have been laid before such counsel. To the same effect is Carnegie v. Gage Furniture, Inc., 217 Kan. at 569, where it is stated that when a defendant seeks to rely on the advice of counsel to establish probable cause for instituting a civil action it must appear that he fully disclosed to counsel the facts surrounding the charge as well as those which can be learned, by reasonable effort.
(11) As noted above, one of the elements of an action for wrongful use of civil proceedings is that the'prior civil proceeding must have terminated in favor of the person against whom the prior civil action was brought. The action cannot be brought if-the original action is still pending and undetermined. Harper v. Cox, 113 Kan. 357, 214 Pac. 775 (1923). Civil proceedings may be terminated in favor of the person against whom they are brought by (1) the favorable adjudication of the claim by a competent tribunal, or (2) the withdrawal of the proceedings by the person bringing them, or (3) the dismissal of the proceedings because of his failure to prosecute them. A favorable adjudication may be by a judgment rendered by a court after trial, or upon demurrer or its equivalent. Whether a withdrawal or an abandonment constitutes a final termination of the case in favor of the person against whom the proceedings are brought and whether the withdrawal is evidence of a lack of probable cause for their initiation, depends upon the circumstances under which the proceedings are withdrawn. Restatement § 674, comment j.
In Bratton v. Exchange State Bank, 129 Kan. at 86, it was held that the abandonment of a cause of action by the filing of an amended petition was a sufficient- termination to authorize a malicious prosecution action. It is clear that the termination of the prior action favorable to the plaintiff required as an element of a malicious prosecution action may result without a trial of the prior action on the merits. Green v. Warnock, 144 Kan. 170, 58 P.2d 1059 (1936). The issue, of “termination favorable to plaintiff” was thoroughly discussed in an early Kansas case, Marbourg v. Smith, 11 Kan. *554 (1873). In Marbourg, an action for slander was dismissed as to defendant Smith, but without his agreement or authorization. In Smith’s action against Marbourg for malicious prosecution, dismissal of the prior action for slander was held to be no bar to Smith’s action. The requirement of a termination favorable to plaintiff was explained as follows:
“But it is not necessary that there should have been a trial upon the merits of the alleged malicious prosecution. If the action has been dismissed, as in this case, that is sufficient, if the action has not been commenced again. [Citations omitted.] The reasons why an action should be terminated in favor of a defendant before the defendant can commence an action for malicious prosecution would seem to be as follows: First, if the action is still pending, the plaintiff therein may show in that action that he had probable cause for commencing the suit by obtaining a judgment therein against the defendant, and he should not be called upon to show such fact in a second action until he has had this opportunity of showing it in the first; second, and if the action has terminated against the defendant, then there is already an adjudication against him, showing conclusively that the plaintiff had probable cause for commencing the action. When neither of these reasons apply, we suppose the action for malicious prosecution may be maintained, if the other necessary facts can be shown. If the plaintiff has neither shown nor is attempting to show, by an action in which he is plaintiff, that he had probable cause for commencing his action, then the defendant may show, in an action brought by himself, that the plaintiff did not have probable cause. But suppose the law were otherwise. Suppose that the party commences an action maliciously, and without probable cause, and then, for the purpose of harassing the defendant, gives notice that he will take depositions in several remote places in the United States, and thereby puts the defendant to great trouble, inconvenience, and expense in attending himself, or employing counsel to attend, for the purpose of cross-examining the witnesses, etc.; and then suppose that no such depositions are taken, or were intended to be taken, — can the plaintiff relieve himself from liability to an action for malicious prosecution by simply dismissing his action? Will the defendant have no remedy in such a case?” pp. °562-°563.
It is thus the law that a voluntary dismissal of the prior action without prejudice may be a termination in favor of the person against whom that action was brought.
(12) In order for a plaintiff to recover in an action for malicious prosecution, he must establish that he suffered some actual damages as a result of the defendant’s action. In some jurisdictions, the plaintiff must plead and prove special damages in order to maintain such an action. Special damages are usually held to include either the arrest of the plaintiff’s person, seizure of his property, or other special interference with his person or property. The requirement of alleging “special damages” in a malicious prosecution action is known as the “English Rule.” There exists in the United States a split of authority as to its application. See 52 Am. Jur. 2d, Malicious Prosecution §§ 9,10, and 11, at pp. 191-194. The Supreme Court of Kansas has specifically rejected the special damages requirement in actions for malicious prosecution. In Investment Co. v. Burdick, 67 Kan. at 337, this court adopted the principle that an action may be maintained for the “malicious prosecution of a civil action” where the defendant in such prosecution alleges and shows that he has sustained any damage over and above the taxable costs in the case. Marbourg v. Smith, 11 Kan. at *554. See also Tire Co. v. Kirk, 102 Kan. 418, 421, 170 Pac. 811 (1918), where it is held that damages are recoverable for the malicious prosecution of an ordinary civil action, even where there has been no arrest, attachment, or other special interference with person or property. The damages recoverable in a malicious prosecution action are stated in the Restatement § 681 to be as follows:
“(a) the harm normally resulting from any arrest or imprisonment, or any dispossession or interference with the advantageous use of his land, chattels or other things, suffered by him during the course of the proceedings, and
“(b) the harm to his reputation by any defamatory matter alleged as the basis of the proceedings, and
“(c) the expense that he has reasonably incurred in defending himself against the proceedings, and
“(d) any specific pecuniary loss that has resulted from the proceedings, and
“(e) any emotional distress that is caused by the proceedings.” p. 469.
This section of the Restatement was referred to with approval in Vaughan v. Hornaman, 195 Kan. at 298-299. In Vaughan, the damages alleged, including hindrance and harassment in the operation of plaintiff’s business, diminished earning capacity, injury to plaintiff’s personal reputation, anxiety and pain of mind, were held to be sufficient to support the action for malicious prosecution. Likewise, in Stalker v. Drake, 91 Kan. at 148, it is stated that, in such an action, a plaintiff may recover, in addition to pecuniary loss, such damages as humiliation, stress, and injury to his standing. It is clear that Kansas has specifically rejected the requirement of some special interference with plaintiff’s person or property in order to maintain an action for malicious prosecution. It should also be noted that exemplary damages may be recoverable, provided actual damages are proved. Stalker v. Drake, 91 Kan. 142, Syl. ¶ 3; Schippel v. Norton, 38 Kan. 567, 16 Pac. 804 (1888).
In cases where attorneys are sued for malicious prosecution of a civil action, there are special rules to be applied in determining an attorney’s liability. In Restatement ¶ 674, comment d, the liability of an attorney in such an action is stated to be as follows:
“d. Attorneys. An attorney who initiates a civil proceeding on behalf of his client or one who takes any steps in the proceeding is not liable if he has probable cause for his action (see § 675); and even if he has no probable cause and is convinced that his client’s claim is unfounded, he is still not liable if he acts primarily for the purpose of aiding his client in obtaining a proper adjudication of his claim. (See § 676.) An attorney is not required or expected to prejudge his client’s claim, and although he is fully aware that its chances of success are comparatively slight, it is his responsibility to present it to the court for adjudication if his client so insists after he has explained to the client the nature of the chances.
“If, however, the attorney acts without probable cause for belief in the possibility that the claim will succeed, and for an improper purpose, as, for example, to put pressure upon the person proceeded against in order to compel payment of another claim of his own or solely to harass the person proceeded against by bringing a claim known to be invalid, he is subject to the same liability as any other person. . . . An attorney may also be subject to liability if he takes an active part in continuing a civil proceeding properly begun, for an improper purpose and without probable cause.” pp. 453-454.
We approve section 674 and comment d as a fair statement of the law to govern the liability of attorneys in Kansas for malicious prosecution of a civil action. The most recent case involving the liability of an attorney in a malicious prosecution action was before this court in 1926 in Maechtlen v. Clapp, 121 Kan. 777. In Maechtlen, the liability of an attorney is stated in syllabus ¶¶ 1 and 2 of the opinion as follows:
1. “An attorney who knowingly permits a client to make him an instrument in prosecuting a groundless action against another to accomplish some evil purpose of the client, may be held accountable to the injured person in an action for malicious prosecution, but he is not responsible if he commences and prosecutes the action in good faith without knowledge of the fraudulent purpose of his client or that the claim sued upon is groundless.
2. “Unless the groundless character of the cause and the malicious motive of his client is brought to his attention, an attorney may advise and act on the assumption that the facts related by his client are honestly given and are substantially correct; and further, that it is not his duty to go elsewhere for information respecting the honesty of the claim or the good faith of his client.”
It should be noted that the standard of responsibility placed on an attorney in Maechtlen does not rise to the same level as that required in the Restatement (Second) of Torts. The opinion in Maechtlen v. Clapp, 121 Kan. at 781, cites Bicknell v. Dorion, 33 Mass. (Pick.) 478, to the effect that an attorney at law is not liable for bringing a civil action unless he commenced it without the authority of the party in whose name it was sued, or unless there was a conspiracy between them to bring a groundless suit, the attorney knowing it to be groundless, and commenced without any intention or expectation of maintaining it. We reject any such limitation on the liability of an attorney and adopt the general statement of the law as set forth in Restatement (Second) of Torts § 674 (1976) which is quoted above.
We further reject the statement in Maechtlen that an attorney may act on the assumption that the facts related by his client are honestly given and are substantially correct and that it is not his duty to go elsewhere for information respecting the honesty of the claim or the good faith of his client. Such a rule is degrading to the legal profession and not acceptable in these times. This court in the Code of Professional Responsibility (225 Kan. xciii) has established general standards of behavior required of the Kansas legal profession. Canon 7 of the Code requires a lawyer to represent a client zealously within the bounds of the law. DR 7-102 specifically states that in his representation of a client, a lawyer shall not file a suit, assert a position, conduct a defense, delay a trial, or take other action on behalf of his client when he knows or when it is obvious that such action would serve merely to harass or maliciously injure another. Under DR 6-101, a lawyer is required to represent a client competently and is directed to not handle a legal matter without preparation adequate in the circumstances. As noted above, the rule is well established in Kansas that the advice of counsel as to the institution of a civil action, acted upon in good faith, will absolve the client from liability for malicious prosecution only where the facts known to the informant and all which can be found by a diligent effort to acquire information, have been presented to the attorney. Carnegie v. Gage Furniture, Inc., 217 Kan. at 569. In most cases, the clients of attorneys are not knowledgeable in the law, nor do they know how or where further information about the case may be acquired. It is obvious that the client must rely upon his lawyer to make a reasonable investigation of his case. Likewise, the attorney must accept the obligation to conduct a reasonable investigation in an attempt to find what the true facts are before filing a civil action on behalf of his client. In determining probable cause in a malicious prosecution action brought against an attorney, a jury may properly consider not only those facts disclosed to counsel by the client but also those facts which could have been learned by a diligent effort on the attorney’s part. In determining the purpose of the attorney in filing a civil action, a jury may properly consider as evidence of good faith or absence of malice the fact that the attorney, before filing an action, made a demand upon his client’s adversary and extended to him the opportunity to respond with his version of the facts. This should be the standard procedure unless an immediate filing of an action is required by the imminent running of the statute of limitations or some other good reason.
With these general principles in- mind, we turn now to the specific issues which have been raised on the appeal. Simply stated, it is the position of Dr. Nelson that dismissal of his malicious prosecution action contained in count 1 was premature because the facts had not been adequately developed by discovery at the time the order of dismissal was entered. He contends that, at that time, he had commenced the discovery process which had been successfully opposed by counsel. He further maintains that all necessary elements for a cause of action of malicious prosecution of a civil action are alleged in his petition and that the scanty record before the trial court did not permit dismissal of his claim as a matter of law until the facts could be determined. It is the position of the defendants that the plaintiff failed in his petition, when considered in light of the other documents presented to the court, to sufficiently allege the necessary elements of probable cause, malice, and special injury, and further that, as a matter of law, there has been no termination of the prior malpractice action in favor of the plaintiff.
We have concluded that the dismissal of the plaintiff’s first claim based on the theory of malicious prosecution of a civil action was improperly granted. The allegations of the plaintiff’s petition are set forth above. That petition clearly alleges the essential elements of an action for malicious prosecution. It is clearly alleged that the defendant attorneys initiated and continued the prior medical malpractice proceeding against the plaintiff in Sedgwick County without probable cause and with malice and that the action terminated in plaintiff’s favor on October 10, 1977, which was the day the action was dismissed without prejudice as against Dr. Nelson. The petition in count 1 further alleged that, as a direct result of the defendants’ actions, the plaintiff was damaged. Whether or not there was probable cause or improper purpose in filing the action could not be determined as a matter of law in the vacuum of facts in the case which existed at the time the plaintiff’s action was dismissed. As noted above, it was not necessary for the plaintiff to plead or prove that a conspiracy existed between the Van Novers and their attorneys.
We also find no merit in the contention that the plaintiff’s amended petition was defective because it failed to allege or prove special damages. That requirement has been specifically rejected by the Kansas cases. Investment Co. v. Burdick, 67 Kan. at 337. Likewise, we reject the contention of the defendants that by procuring a stipulation and order of dismissal, Dr. Nelson is barred from bringing an action for malicious prosecution because there has been no termination in his favor. As noted above, a voluntary dismissal of the prior action without prejudice under Kansas law may be a termination in favor of the defendant in that action, if the action is not commenced again. For these reasons, we hold that the trial court erred by prematurely dismissing plaintiff’s first claim against the defendants based upon a theory of malicious prosecution of a civil action.
We turn now to the issue whether the trial court erred in dismissing Dr. Nelson’s second claim against defendants which asserted a theory of liability based upon professional negligence. In his petition, plaintiff alleges in substance that the defendants were negligent in failing to investigate the claim against Dr. Nelson and in continuing to prosecute the claim having knowledge that the claim against the plaintiff was unjust and totally without merit. The district court rejected the plaintiff’s second claim, holding that an attorney cannot be held liable to a person other than his client on the basis of negligence alone. In support of his position the plaintiff relies in part on DR 7-102(a) of the Canons of the Code of Professional Conduct which, in substance, prohibits an attorney, in his representation of a client, from asserting claims which he knows to be groundless or when it is obvious that such action would serve merely to harass or maliciously injure another. This issue was squarely presented to the Court of Appeals in Young v. Hecht, 3 Kan. App. 2d 510, 597 P.2d 682, rev. denied 226 Kan. 793 (1979). In Young, the Court of Appeals held that an attorney cannot, in the absence of special circumstances, be held liable for the consequences of his professional negligence to anyone other than his client. There are many cases on this subject in the annotation in 45 A.L.R.3d 1181. The traditional rule has been that an attorney will be held liable for negligence only to his client. The rationale of that rule is that there can be no action against an attorney for professional negligence in the absence of some privity of contract between the plaintiff and the attorney. More recently, the strict requirement of privity of contract has been eased in situations where an attorney has rendered services which he should recognize as involving a foreseeable injury to some third-party beneficiary of the contract. These cases usually involve the negligence of attorneys in will drafting and in the examination of real estate titles. We have been cited no cases, and we have found none, where an attorney has been held liable to his client’s adversary in prior civil litigation on the basis of professional negligence alone.
In Tappen v. Ager, 599 F.2d 376 (10th Cir. 1979), the United States Court of Appeals approved the position of the district court that an attorney engaged in discharging professional duties on behalf of his client cannot be held liable for negligence toward a third person, for the reason that the attorney’s paramount and exclusive duty is to his client. The court noted that there had been some relaxation of the doctrine in some states but this had arisen only in cases where the attorney’s services were in part for the benefit of a third party. No such relaxation is to be permitted where the relationship is an adversary one. In that situation, the lawyer’s duty must be to his client alone and there is no room for any duty running to the client’s adversary.
The rationale of the cases which have rejected the concept of liability of an attorney to a third party for professional negligence is based upon public policy. A leading case in this area is Norton v. Hines, 49 Cal. App. 3d 917, 123 Cal. Rptr. 237 (1975), where the court stated:
“In the case at bar a former litigant is suing adverse counsel. Clearly, an adverse party is not an intended beneficiary of the adverse counsel’s client. If a cause of action exists against attorneys for the reasons alleged here, it must be pleaded as an action for malicious prosecution. . . .
“Malicious prosecution is a specific tort that developed in the criminal field out of a need to adjust two highly important social interests. The first is the interest of society in the efficient enforcement of the criminal law, which requires that private persons who aid in the enforcement of the law should be given an effective protection against the prejudice which is likely to arise from the termination of the prosecution in favor of the accused. The second is to protect the individual citizen against unjustifiable and oppressive litigation of criminal charges, which involves pecuniary loss, distress and loss of reputation. [Citation omitted.] In general, the same considerations apply to wrongful initiation of civil proceedings. The courts are open to every citizen to sue, subject only to the penalty of lawful costs if the action is unsuccessful. [Citation omitted.] Public policy requires that a large degree of freedom of access to the courts be accorded to all persons for the settlement of their private disputes. At the same time the courts can not be ‘used’ by a person who sues another without probable cause and with malice. The tort of malicious prosecution is designed to place restraint on a would-be plaintiff while furnishing protection to a wrongfully sued defendant. It naturally follows that the same general principles should apply to the attorney representing the litigant initiating the action. The attorney owes a duty to his client to present his case vigorously in a manner as favorable to the client as the rules of law and professional ethics will permit. He is an advocate and an officer of the court. He is cognizant of the public policy that encourages his clients to solve their problems in a court of law. In our opinion, when representing his client in the initiation of a lawsuit, he should not be judged by a different standard. . . . We believe the public policy of favoring free access to our courts is still viable. However, if Norton’s cause of action against attorneys for negligence is permitted, this policy will be subverted. The attorney must have the same freedom in initiating his client’s suit as the client. If he does not, lawsuits now justifiably commenced will be refused by attorneys, and the client, in most cases, will be denied his day in court.” pp. 921-924.
Cases from other states which are in accord are the following: Merritt-Chapman & Scott Corp. v. Elgin Coal, Inc., 358 F. Supp. 17 (E.D. Tenn. 1972); Lyddon v. Shaw, 56 Ill. App. 3d 815, 372 N.E.2d 685 (1978); Pantone v. Demos, 59 Ill. App. 3d 328, 375 N.E.2d 480 (1978); Hill v. Willmott, 561 S.W.2d 331 (Ky. App. 1978); Brody v. Ruby, 267 N.W.2d 902 (Iowa 1978); Bickel v. Mackie, 447 F. Supp. 1376 (N.D. Iowa 1978); Martin v. Trevino, 578 S.W.2d 763 (Tex. Civ. App. 1978); Spencer v. Burglass, 337 So. 2d 596 (La. App. 1976), writ denied 340 So. 2d 990 (1977).
The lawyers of Kansas have traditionally represented their clients with zeal and professional competence in accordance with the highest traditions of the legal profession. Without their professional endeavors the basic liberties of the people might well have disappeared long ago. Kansas lawyers have made outstanding contributions in their representation of the poor and underprivileged, and in the development of new principles of law to meet the needs of our changing society. They must not be discouraged in those endeavors.
In representing their clients, lawyers are expected to use the legitimate sidearms of a warrior. It is only when a lawyer uses the dagger of an assassin that he should be subjected to discipline or to personal liability. We believe that the public is adequately protected from harassment and abuse by an unprofessional member of the bar through the means of the traditional cause of action for malicious prosecution. We, therefore, hold in accordance with established law, that an attorney cannot be held liable for the consequence of his professional negligence to his client’s adversary. We further hold that a violation of the Code of Professional Responsibility does not alone create a cause of action against an attorney in favor of a third party. The remedy provided a third-party adversary is solely through an action for malicious prosecution of a civil action. It follows that the district court was correct in dismissing the plaintiff’s second cause of action based upon a theory of professional negligence.
The judgment of the district court is reversed as to the dismissal of the plaintiff’s first claim based upon a theory of malicious prosecution of a civil action. The judgment is affirmed as to the dismissal of the plaintiff’s second claim based on professional negligence. The case is remanded to the trial court to permit the parties to proceed with discovery so that the facts may be developed and the rights of the parties determined as to plaintiff’s claim for malicious prosecution of a civil action.
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The opinion of the court was delivered by
Prager, J.:
This is a direct appeal in a criminal action in which the defendant, Sidney E. Bryant, was convicted of aggravated robbery (K.S.A. 21-3427), and given a mandatory sentence under K.S.A. 1978 Supp. 21-4618. The evidence in the case was undisputed that on November 27, 1978, the Sonic Drive-In in Wichita was robbed by three black males. One of the robbers had a gun. The only real factual issue for the jury to determine was the identity of the defendant as one of the robbers.
The State's evidence showed that the robbery took place at about 12:10 p.m. on November 27,1978. Jerald Peck, the manager of the drive-in, noticed three black males enter the building. He then heard a loud noise which sounded like either a firecracker or a gunshot. A voice then demanded money, stating that it was a holdup. One of the men jumped behind the counter, taking money in a total amount of $3600. Peck did not actually see a firearm. He concluded that the men were armed because of the earlier noise. This witness positively identified the defendant as one of the robbers. Charlotte Schneider, an employee, observed a gun in the possession of one of the robbers who, in her opinion, was shorter than 5 7 . She was unable to identify any of the robbers. The State’s final witness, Isaac Stewart, admitted his participation in the robbery. Stewart testified that it was the defendant who used Stewart’s gun at the scene. The two of them, along with Willie Diller and another man, went to the drive-in. According to Stewart, as the robbers entered the building, the defendant demanded money and brandished the gun which accidentally discharged, hitting the defendant’s foot. That was the noise heard by the manager. Diller jumped behind the counter, took the money, and the three robbers then fled. The testimony of Stewart that the defendant had accidentally shot himself in the foot was corroborated by Dr. Nancy Nowlin who testified that, on examination of defendant’s foot, she observed a small scar close to the toe. The defendant’s witnesses testified to an alibi defense. According to them, the defendant was home in bed and sick at the time of the robbery. Following his conviction, the defendant brought an appeal to this court, claiming trial errors.
The first point raised on the appeal is that the trial court abused its discretion in permitting the State to endorse the name of Isaac Stewart as an additional witness on the day of the trial. The original information in the case was filed on January 8, 1979. The defendant’s preliminary hearing was held on January 22. On January 24 the police officers took a taped statement from Isaac Stewart. An amended information was filed on January 31, 1979. The case was called for trial on February 20, 1979. On that day at 11:30 a.m., Thomas J. Weilert, an assistant district attorney, was assigned the case. In talking with one of the police officers, Weilert first became aware of the taped statement of Isaac Stewart. Weilert immediately notified defense counsel of the existence of the tape and his intent to move for the late endorsement of Isaac Stewart as a witness in the case. Prior to the commencement of voir dire, the State filed a motion requesting the late endorsement. The trial court sustained the motion and permitted the endorsement, provided defense counsel was given an opportunity to read a copy of the transcript and hear the tape and further to be given an opportunity to interview the witness, if he so desired. Counsel for the defendant objected to the late endorsement of the witness. From the record, it appears that the district attorney’s office did not have knowledge of the tape’s existence prior to the day the case was set for trial. During the discussions about the late endorsement, the State suggested a continuance of the case. Defense counsel, after hearing the tape and interviewing the witness, did not request a continuance of the trial to a later date.
Under all of the circumstances, we have concluded that the trial court did not abuse its discretion in permitting the late endorsement. K.S.A. 1978 Supp. 22-3201(6) has been construed to confer broad discretionary power on the trial court in allowing a late endorsement. A trial court’s order permitting a late endorsement of a witness is not to be overturned absent an abuse of discretion. The test is whether the defendant’s rights have been prejudiced. State v. White & Stewart, 225 Kan. 87, 91, 587 P.2d 1259 (1978). This court will not condone surprise caused by the intentional withholding of the name of a witness as a part of the prosecution’s trial strategy. State v. Stafford, 213 Kan. 152, 164, 515 P.2d 769 (1973), modified 213 Kan. 585, 518 P.2d 136 (1974). The purpose of the endorsement requirement is to prevent surprise to the defendant and to give him an opportunity to interview and examine the witnesses for the prosecution in advance of trial. State v. Stafford, 213 Kan. at 164. The trial court commits reversible error in allowing a late endorsement when surprise prevents “a fair preparation of his defense.” State v. Wilson & Wentworth, 221 Kan. 359, 559 P.2d 374 (1977). Accordingly, this court has traditionally required the defendant not only to object to the late endorsement but to request and be denied a continuance before a late endorsement will constitute reversible error. See for example, State v. Wilson & Wentworth, 221 Kan. at 365.
The record discloses that the prosecutor twice stated to the court that there would be no objection to a continuance, if the defense counsel thought it was necessary to prepare his defense. Defense counsel indicated that he would confer with his client to determine whether a continuance was desirable and did so. He did not thereafter request a continuance. Under all the circumstances, we cannot say that defense counsel’s preparation for the trial was impaired since he apparently needed no additional time to prepare. We also note that defense counsel vigorously cross- examined Isaac Stewart and brought to the jury’s attention certain discrepancies to impeach his testimony.
The defendant’s second point is that the trial court erred in failing to instruct the jury that it should consider with caution the uncorroborated testimony of an accomplice witness. Specifically, defense counsel requested PIK Crim. 52.18. This court has required a cautionary instruction when the testimony of an accomplice is uncorroborated. State v. Moody, 223 Kan. 699, 576 P.2d 637, cert. denied 439 U.S. 894 (1978); State v. Wood, 196 Kan. 599, 604, 413 P.2d 90 (1966). Although some discrepancies exist between the testimony of the various witnesses, we cannot say that the testimony of Isaac Stewart was uncorroborated. The manager, Peck, identified defendant as one of the robbers and further testified that he heard a loud noise that sounded like a gunshot immediately prior to the robbery. Mrs. Schneider was unable to identify the defendant but did testify that one of the robbers had a gun. As indicated above, there was evidence from which it could be inferred that the defendant had suffered a gunshot wound to his foot. Under all the circumstances, it cannot be said that Isaac Stewart’s testimony was uncorroborated to the extent it was error for the trial court to fail to give the cautionary instruction. See State v. Parrish, 205 Kan. 178, 468 P.2d 143 (1970).
The defendant next maintains that the trial court erred in sentencing the defendant to a mandatory sentence under K.S.A. 1978 Supp. 21-4618, because there was insufficient evidence to establish that the defendant used a firearm in the commission of the robbery. In State v. Taylor, 225 Kan. 788, 795, 594 P.2d 211 (1979), this court defined the scope of review of sentencing under K.S.A. 1978 Supp. 21-4618 to be limited to whether there was competent evidence that the defendant used a firearm when committing the robbery. In this case there was competent evidence that the defendant was in possession of a firearm during the robbery. That evidence is discussed earlier in this opinion. We find no merit in this contention.
As his final point, the defendant contends that the trial court erred in failing to grant him a new trial because of the recantation by Isaac Stewart of his trial testimony and, further, that the trial court should have brought the defendant back from the penitentiary for the hearing on his motion for a new trial. The factual circumstances surrounding this point are as follows: The defendant’s trial commenced on February 20, 1979, and the verdict of guilty was returned by the jury on February 23, 1979. On March 20,1979, the trial court considered the defendant’s motion for judgment of acquittal or in the alternative for a new trial and overruled the motion. The court immediately imposed sentence. On April 2,1979, defense counsel filed a motion for a new trial for newly discovered evidence, based upon a letter from Isaac Stewart to Judge Ballinger in which Stewart denied the truth of his trial testimony. The substance of Stewart’s letter was that the defendant Bryant had not been involved in the robbery and that he, Stewart, had lied in so testifying. At the time the letter was received, Isaac Stewart was being held in the Sedgwick County jail. The trial court promptly provided a copy of the letter to each counsel.
On April 17, Judge Ballinger ordered Stewart to be brought before the court to give his version of the contents of the letter. Defense counsel appeared at this inquiry, but defendant Bryant was not personally present. The trial court made it clear that the proceeding was to be held as a preliminary inquiry to see what Stewart had to say about the letter and, depending upon what his testimony might be, the court would then determine whether a hearing should be held on the defendant’s motion for a new trial. Isaac Stewart took the stand and was fully examined by defense counsel. Having identified the letter as written by him, Stewart testified unequivocally that he wrote the letter because the defendant Bryant had threatened to kill him if he did not write it. The letter was written the night before defendant Bryant was taken to Hutchinson. Stewart testified that everything he had said in the letter was false and that the letter had originally been prepared by the defendant Bryant and that he, Stewart, had copied it in his own handwriting. Stewart reaffirmed his testimony that Bryant had possessed the gun at the robbery and stated that his testimony would basically be the same as he had presented at the trial. The witness further stated that five of his cellmates had been present when Bryant threatened him. Among the names mentioned was one Johnny Wilson. Following the presentation of this testimony, the court noted that defendant’s motion for a new trial was based solely upon the State’s primary witness’s recantation of his testimony and that the witness had repudiated his recantation. The court then observed that Stewart’s testimony on the stand did not change anything that Stewart had previously testified to at the trial. Since the witness had not recanted his testimony, the trial court found no basis for granting a rehearing on the defense’s motion for a new trial and overruled the motion.
On May 21, 1979, defense counsel moved for another hearing on the motion and for an order directing the defendant, Isaac Stewart, and Johnny Wilson to be brought before the court. According to defense counsel, Johnny Wilson was expected to testify that he was in the same cell as Stewart and that Bryant had not threatened or otherwise coerced Stewart to write the letter. This motion was considered by the court on June 12, 1979, and denied. The basis of. the court’s ruling was that it was unnecessary to reconsider the motion since Stewart’s testimony had not in fact been recanted.
On these facts, the defendant now claims that he was denied his constitutional and statutory right to confront the witnesses against him. In support of his position, defendant relied on K.S.A. 22-3405, which provides in part as follows:
“22-3405. Presence of defendant. (1) The defendant in a felony case shall be present at the arraignment, at every stage of the trial including the impaneling of the jury and the return of the verdict, and at the imposition of sentence, except as otherwise provided by law.”
K.S.A. 22-3501 provides that the court on motion of defendant may grant a new trial to him if required in the interest of justice. That statute further provides that a motion for a new trial based on the ground of newly discovered evidence may be made within two years after final judgment. A motion for a new trial based on other grounds may be filed within ten days after the verdict or finding of guilty or within such further time as the court may fix. The issue presented here is whether the defendant is entitled to be present, as a matter of right, at a hearing on his motion for a new trial filed after the imposition of sentence, where the ground asserted is newly discovered evidence. We have concluded that the presence of the defendant at such a hearing is a matter resting within the sound discretion of the trial court.
The majority view throughout the United States is that the presence of a convicted defendant is not required at a hearing on a postverdict motion for a new trial. 21 Am. Jur. 2d, Criminal Law § 308; Annotation at 69 A.L.R.2d 835. The rationale of the majority rule is that the trial ends when a verdict has been rendered, that any right which an accused may have to be present at proceedings following indictment continues only during the pendency of the trial, and that a defendant, once convicted, cannot expect to be present at postconviction motions. A motion for a new trial based upon newly discovered evidence, filed after the imposition of sentence, is comparable to the procedure provided under K.S.A. 60-1507. In proceedings under 60-1507, the trial court normally conducts a preliminary inquiry to determine whether the claims asserted in the motion are substantial, before granting a full evidentiary hearing and requiring the petitioner to be present. Such a preliminary inquiry without the presence of the defendant has been upheld by the United States Supreme Court where a defendant pursues the postconviction remedy provided by 28 U.S.C.A. § 2255. See Sanders v. United States, 373 U.S. 1, 21, 10 L. Ed. 2d 148, 83 S.Ct. 1068 (1963).
It is not unusual for a State’s primary witness, who has been granted immunity, to recant his testimony presented at the trial of an accomplice charged with the same crime. It is also quite common for such a witness to repudiate his recantation. The judicial attitude is that a recantation should be “looked upon with the utmost suspicion.” United States v. Troche, 213 F.2d 401, 403 (2nd Cir. 1954); 2 Wright, Federal Practice & Procedure: Criminal § 557, pp. 526-527 (1969).
We cannot fault the procedure followed by the trial court in this case. After receiving a letter from Isaac Stewart recanting his testimony at the trial, the court promptly delivered a copy of the letter to the prosecutor and to defense counsel. Defense counsel filed a motion for a new trial for newly discovered evidence based upon the letter. The trial court then brought the witness into court, where the witness was examined by defense counsel. The witness Stewart repudiated his recantation and stated that his trial testimony was the truth. There was no prior request made by the defendant to be personally present at this preliminary inquiry. Upon the repudiation of the witness’s recantation, the trial court promptly overruled the motion for a new trial since it was shown to be without foundation or substance. Thus a full blown hearing in the matter was not required. We cannot say that the trial court abused its discretion in refusing to grant the defendant a further evidentiary hearing with an opportunity to be present.
We wish to emphasize we are not holding that a trial court has an unbridled discretion to deny a defendant an evidentiary hearing on a motion for a new trial based upon newly discovered evidence where there is substantial evidence to support the motion. We are simply holding that, under the circumstances of this case, the trial court did not abuse its discretion.
In State v. Johnson, 222 Kan. 465, 565 P.2d 993 (1977), the rules for granting a new trial for newly discovered evidence were stated as follows:
“The granting of a new trial for newly discovered evidence is in the trial court’s discretion. (State v. Larkin, 212 Kan. 158, 510 P.2d 123, cert. den. 414 U.S. 848, 38 L.Ed.2d 95, 94 S.Ct. 134.) A new trial should not be granted on the ground of newly discovered evidence unless the evidence is of such materiality that it would be likely to produce a different result upon re-trial. (State v. Hale, 206 Kan. 521, 479 P.2d 902.) The credibility of the evidence offered in support of the motion is for the trial court’s consideration. (State v. Anderson, 211 Kan. 148, 505 P.2d 691; State v. Larkin, supra.) The burden of proof is on defendant to show the alleged newly discovered evidence could not with reasonable diligence have been produced at trial. (State v. Lora, 213 Kan. 184, 515 P.2d 1086; State v. Arney, 218 Kan. 369, 544 P.2d 334.) The appellate review of an order denying a new trial is limited to whether the trial court abused its discretion. (State v. Campbell, 207 Kan. 152, 483 P.2d 495; State v. Anderson, supra.)” (p. 471.)
We find that the district court did not abuse its discretion in refusing to grant the defendant a new trial for newly discovered evidence.
The judgment of the district court is affirmed. | [
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The opinion of the court was delivered by
Fromme, J.:
A personal injury suit was brought against the city of Pittsburg by Fred Verren to recover for injuries suffered in a fall at a city park. Judgment was entered on a jury verdict. The Court of Appeals affirmed the judgment in an unpublished opinion. We reverse the judgment of the Court of Appeals and remand the case to the district court for further proceedings.
Now we consider the facts.
Mr. Verren and his four sons had gone to Lincoln Park. Two of the sons were playing in a ball game. Father and sons became separated. While looking for one of his spectator sons Mr. Verren came upon a large concrete slab in the park. He walked across the slab, stepped into a hole at the north edge and injured himself. He spent five weeks in a cast and several more weeks on crutches. The hole which caused his injuries was 12 to 14 inches deep. It had been there several years with knowledge of the city.
Suit was filed. Mr. Verren, as plaintiff, recovered a judgment for $5,600.00 against the city. The suit was under the comparative negligence law, K.S.A. 60-258a. The jury assessed the plaintiff’s fault at 30% and the city’s fault at 70%. The jury set the total amount of plaintiff’s damage at $8,000.00. After deducting the 30%, or $2,400.00, as plaintiff’s fault, judgment was entered by the court in favor of plaintiff for $5,600.00.
Defendant city filed a motion for new trial and in support of the motion charged jury misconduct and attached affidavits of two jurors to the motion. One affidavit stated:
“I served as juror in a case wherein Fred Verren sued the City of Pittsburg, Kansas; that the jury in its computation of damages specifically apportioned an amount included within its total amount of damages for plaintiff’s attorney’s fees; the jury in its computation of damages considered what percentage of fault would be attributed to the parties and then took this percentage into consideration in arriving at the damages to allow plaintiff a predetermined net recovery for his damages.”
The second affidavit was almost identical in content and was signed by the foreman of the jury. When the motion for new trial came on for hearing plaintiff objected to the admission of the proposed testimony on the ground that it related to the mental processes of the jurors and was not admissible under our statutes. The trial court sustained the motion to exclude the evidence. A formal offer of proof was made. The motion for new trial was overruled. The statutes which govern are as follows:
“Upon an inquiry as to the validity of a verdict or an indictment no evidence shall be received to show the effect of any statement, conduct, event or condition upon the mind of a juror as influencing him or her to assent to or dissent from the verdict or indictment or concerning the mental processes by which it was determined.” K.S.A. 60-441.
“This article shall not be construed to (a) exempt a juror from testifying as a witness to conditions or occurrences either within or outside of the jury room having a material bearing on the validity of the verdict or the indictment, except as expressly limited by K.S.A. 60-441; . . .” K.S.A. 60-444(a).
Under these statutes we have held that a juror may not impeach his or her verdict on any ground inherent in the verdict itself; a juror may not divulge what considerations personally influenced him or her in arriving at the verdict or what reasoning personally led him or her to the final decision. State v. Taylor, 212 Kan. 780, 512 P.2d 449 (1973). More recently in Crowley v. Ottken, 224 Kan. 27, 31, 578 P.2d 689 (1978), it was pointed out that evidence is not admissible under K.S.A. 60-441 if it only pertains to the reasons a juror joined in the verdict. To be admissible the evidence must relate to extrinsic misconduct or to physical facts or occurrences within or without the jury room.
It appears from the Kansas cases that the line of demarcation between what is and what is not admissible has been difficult to draw. After having considered the statutes, K.S.A. 60-441 and 60-444, Spencer A. Gard in 16 Kan. L. Rev. 125, 134 (1967), indicates that the statutes did not change the rules of evidence in this area which existed prior to the adoption of the civil code. So the general comment in VIII Wigmore on Evidence, § 2348, et seq., (McNaughton rev. 1961), would seem to be helpful. There it is stated that a jury is required to perform one legal act, which act is encompassed in its verdict. It is the verdict and not the prior intentions which is taken as exclusively constituting that act. For this reason evidence as to jurors’ motives, beliefs, misunderstandings, intentions and the like are regarded as immaterial in any inquiry concerning the validity of a verdict. The verdict speaks for itself and all other such matters inure in the verdict. This rule is necessary to assure the finality of verdicts and to protect against the corruption of jurors after discharge.
On the other hand there are certain formalities of conduct which a jury is required to follow. Failure to obey these essential formalities of conduct can invalidate the verdict. Evidence may be offered in such cases to impeach a verdict when the evidence will show actions of the jurors by which they have intentionally disregarded the court’s instructions or violated one or more of the essential formalities of proper jury conduct. See VIII Wigmore on Evidence, § 2348.
In Perry v. Bailey, 12 Kan. 539, Syl. ¶ 3 (1874), this court holds:
“The general rule is, that affidavits of jurors are admissible to explain and uphold their verdict, but not to impeach and overthrow it. But this general rule is subject to this qualification, that affidavits of jurors may be received, for the purpose of avoiding a verdict, to show any matter occurring during the trial, or in the jury room, which does not essentially inhere in the verdict itself, as, that a juror was improperly approached by a party, his agent, or attorney, or that the verdict was determined by lot; but not to show any matter which does essentially inhere in the verdict, as that the juror did not assent to the verdict, that he misunderstood the instructions, or the testimony, or any other matter resting alone in the juror’s breast.”
In Kincaid v. Wade, 196 Kan. 174, 178-179, 410 P.2d 333 (1966), our court pointed out one of the reasons which compels us to have a rule against impeachment of a juror’s verdict based on his or her mental processes, the reasoning by which he or she arrived at the verdict. In Kincaid it is stated:
“A verdict may not be impeached by (1) questions as to a juror’s views— conclusions, or (2) questions as to the reasons for those views — factors determining conclusions, or (3) questions which reach what influences those views — factors which influence the mental process in reaching such conclusion.
“It may be said that the mental process of a juror in reaching a verdict or the factors which influence the mental process cannot be inquired into for the purpose of impeaching a verdict.
“Public policy forbids the questioning of a juror on the above entitled matters for a very obvious reason, i.e., there is no possible way to test the truth or veracity of the answers. In McDonald v. Pless, supra [238 U.S. 264], while considering the right to inquire into a jury’s basis for reaching a verdict it was suggested that to permit the inquiry—
. . . would open the door to the most pernicious arts and tampering with jurors.” “The practice would be replete with dangerous consequences.” “It would lead to the grossest fraud and abuse” and “no verdict would be safe.” ’ (p. 268.)
“However, there is a contra matter of public policy to be considered. Improper conduct on the part of a juror is charged to the entire panel, as the jurors operate as a unit, and public policy demands that misconduct be discouraged and insofar as possible prohibited.
“This court has found it advisable to permit inquiry into physical matters and misconduct which comes to the attention of other members of the panel and may be verified or denied.”
Such matters of misconduct by the jury, if they occurred in this case, may be uncovered and the truth and veracity of those testifying to such misconduct can be tested. The matters recited in the affidavits filed in the present case do not solely relate to the mental processes, nor do they rest alone in the mind of a juror or jurors. The matters set forth in the affidavits, if proven, would establish a conscious conspiracy by the members of the jury to disregard and circumvent the instructions on the law given by the court. If they did so the jurors would have violated their oaths as jurors. The juror’s oath is so common to lawyers and judges it need not be iterated but each juror agrees under oath to follow the law in the instructions.
In this case the jurors were instructed as to the items they could consider in arriving at the amount of damages. Instruction No. 5 reads:
“In determining the amount of any recovery by plaintiff, you should allow him such amount of money as will reasonably compensate him for his injuries and losses resulting from the occurrence in question including any of the following shown by the evidence:
“a. Pain, suffering, disabilities, or disfigurement, and any accompanying mental anguish suffered by plaintiff to date.
“b. The reasonable expenses of -necessary medical care and treatment received.
“c. Loss of time or income by reason of his disabilities.”
The amount plaintiff had to pay for attorney fees was not one of the items of damage included, yet if the facts in the affidavits are proven an amount for attorney fees was included as part of the damages. This court specifically holds in Dunn v. White, 206 Kan. 278, 479 P.2d 215 (1970), that it is misconduct for the jury to add to the damages the amount of possible attorney fees which plaintiff will have to pay.
In addition to the foregoing this jury was instructed on comparative negligence. They were advised that the court was required to reduce the amount of damages which the jury determined by the percentage of fault that the jury found was attributable to plaintiff. In Instruction No. 7 the jury was also instructed:
“In arriving at the full damage figure for each party, you should not consider the question of fault. Do not reduce the damages by any percentage of fault.”
Now, if we assume the truth of the affidavit, the jurors were guilty of misconduct in that they consciously disregarded the instructions of the court. They conspired together so as to circumvent the comparative negligence law. In total disregard of Instruction No. 7, they did consider the question of fault of plaintiff and increased the amount of actual damages to a fictitious figure which would result in giving the plaintiff the entire amount of his actual damage plus attorney fees. No evidence was introduced on the amount of attorney fees and such an item would have to be mere speculation.
The judgment of the Court of Appeals is reversed and the case is remanded to the trial court with instructions to hold another hearing on the motion for new trial. The testimony of the jurors as proffered was admissible. On remand if the evidence as a whole supports the allegations in the affidavits a new trial on the issue of damages only should be granted. On the other hand, if the evidence introduced on the motion for new trial is not sufficient to support the charge of jury misconduct the motion should be overruled and the judgment for $5,600.00 with interest should be reinstated.
As to any possible future trial limited to the issue of damages only, it appears to this court that liability and percentage of fault were definitely established at the first trial, that the questions as to liability and the amount of damages are separate and distinct, that there is no indication the verdict was the result of a compromise involving the question of liability, and it may fairly be said defendant will not suffer manifest prejudice by limiting the trial to the question of damages only. That being true, any new trial limited to the issue of damages would be proper. Dunn v. White, 206 Kan. at 284; see also Schmidt v. Cooper, 194 Kan. 403, 399 P.2d 888 (1965).
All other issues raised on appeal and on the Petition for Review have been considered and we find as to them the judgment of the Court of Appeals should be and is hereby affirmed. The judgment of the Court of Appeals affirming the judgment of the district court on the question of possible jury misconduct is reversed. The case is remanded to the district court for further proceedings in accordance with what has been said herein. | [
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The opinion of the court was delivered by
Herd, J.:
This is an action for rescission of the guaranty of a note and, in the alternative, for damages. Plaintiff, Michael C. Weigand, brought this action against Union National Bank of Wichita for fraudulently concealing information from Weigand thereby inducing him to execute a guaranty of a William Dodson Ltd., Inc. note, to his damage.
A detailed statement of facts is necessary for disposition of this case. William Dodson Ltd., Inc. is a Kansas corporation engaged in the retail clothing business in Wichita. William H. Dodson was president of the corporation. The stockholders were Dodson, Fran Jabara and Donna Jabara. The Jabaras are the brother and sister respectively of Dodson’s former wife, Helen. In 1972, Helen and William Dodson filed an action for divorce which caused a rift among the company stockholders. On January 20, 1973, the corporate board of directors was expanded to include Michael C. Weigand and Robert Cornwell in addition to William Dodson, Fran Jabara and Donna Jabara. Michael C. Weigand was elected corporate secretary-treasurer and F. B. Kubik & Company, C.P.A., was employed as corporate accountant.
Due to the divorce, it became necessary for William Dodson to raise capital to pay his wife a property settlement and redeem the stock in the company from Fran and Donna Jabara. In November 1973, William Dodson held discussions with Union National Bank of Wichita with regard to borrowing $110,000. The bank was furnished a letter from F. B. Kubik & Company setting forth a detailed analysis of the corporation’s financial requirements and William Dodson’s personal financial situation with recommendations regarding the stock redemption and divorce settlement. The refinancing plan presented to the bank provided for redemption of the Jabara stock at book value; conversion of all of William Dodson’s personal debts to corporate debts; distribution of William Dodson’s share of the corporate undistributed previously taxed income in the amount of $43,640 to him; and termination of the corporation’s Subchapter S status. The plan further contemplated that Dodson would pay off his personal note to the bank in the principal amount of $39,000 with his distribution from the corporation. The Bank declined the loan application but agreed to assist the corporation in applying for a Small Business Administration loan. An application was later made to SBA for a loan of $110,000 which was turned down.
In February, 1974, Dodson applied to the bank for another loan for the corporation, this one in the amount of $60,000. A plan for use of the money, prepared by Kubik and dated February 1,1974, contemplated redeeming Donna Jabara’s stock for $30,367 and paying Helen Dodson the balance of the divorce settlement in the amount of $27,733. Fran Jabara’s stock was to be redeemed by giving him a note in the amount of $30,367 drawn on the corporation and guaranteed by Michael C. Weigand payable in one year, secured by Weigand’s 3,000 shares of Pizza Corporation of America stock. The plan was to be closed on or before March 1, 1974, and went on to provide:
“1. The corporation will remain a Subchapter S corporation through July 31, 1974, and effective August 1, 1974, will terminate the election.
“2. After the redemption transaction is closed the corporation will make a distribution of substantially all its accumulated earnings to Bill Dodson. The amount of this distribution is estimated at $40,000. The amount will be loaned back to the corporation by Bill Dodson with interest at 10%.
“3. After July 31,1974, Mike Weigand will buy and Wm. Dodson Ltd., Inc., will sell common stock for $30,367. Mike will acquire the number of shares necessary to produce a corporate book value for the shares of $30,367. The funds received by the corporation will be used to pay the $30,367 note due to Fran Jabara.”
On February 18, 1974, the corporation held a special meeting of the board of directors and the following minutes were made of the meeting:
“A special meeting of the Board of Directors of Wm. Dodson Ltd, Inc., was held on February 18, 1974.
“The Chairman of the Board presented the written Resignation of Fran Jabara and Donna Jabara, as members of this Board, and the Secretary was instructed to file it with these minutes.
“Upon motion duly made, seconded and unanimously passed, the President was authorized and instructed to execute and deliver to Fran Jabara the corporation’s promissory note, in the amount of Thirteen Thousand Dollars ($13,000.00), a copy of which is attached hereto.
“The President announced that Donna Jabara had offered to surrender all of her stock of this corporation, to this corporation, in consideration for a cash payment of Thirty Thousand Three Hundred Sixty-Seven Dollars ($30,367.00). Upon motion duly made, seconded and unanimously passed, said offer was accepted.
“The President announced that Fran Jabara had offered to surrender all of his stock of this corporation, to this corporation, if this corporation would execute and deliver to him its promissory note, in the amount of Thirty Thousand Three Hundred Sixty-Seven Dollars ($30,367.00), a copy of which is attached hereto. Upon motion duly made, seconded and unanimously passed, said offer was accepted and the President was authorized and directed to execute and deliver said promissory note.
“Upon motion duly made, seconded and unanimously passed, the salary of the President was increased to Two Thousand Two Hundred Dollars ($2,200.00) per month, effective as of March 1, 1974.
“Upon motion duly made, seconded and unanimously passed, it was determined that, effective as of March 1, 1974, this corporation should pay William H. Dodson ten percent (10%) interest on the Twenty Thousand Dollar ($20,000.00) loan.
“Upon motion duly made, seconded and unanimously passed, it was determined that this corporation should borrow Sixty Thousand Dollars ($60,000.00) from the Union National Bank of Wichita, and the President was authorized and directed to consúmate [sic] said loan and to execute any and all documents required by said Bank, including Security Agreements covering all personal property, both tangleable and intangleable [sic], owned by this corporation.
“There being no further business for consideration, the meeting was adjourned.
Is/ Michael C. Weigand
Michael Weigand, Secretary”
Dodson then asked the bank to renew his personal note in the amount of $40,000, suggesting funds would be available from the corporation’s Christmas sales to retire his personal obligation. The money to pay off the corporate note to Fran Jabara for stock redemption was to come from the $30,367 stock purchase by Michael C. Weigand after the Subchapter S status had terminated on July 31, 1974, as was stated in the plan presented by Kubik. The bank made the $60,000 loan to the corporation on February 25, 1974, and renewed Dodson’s personal note in the amount of $40,000.
Upon receipt of the $60,000 loan proceeds, Donna Jabara’s stock was redeemed and the divorce settlement was paid to Helen Dodson. Fran Jabara’s stock was redeemed in exchange for a promissory note in the amount of $30,367 from the corporation guaranteed by Dodson and Weigand, dated February 23, 1974, due and payable in one year. As security for his guaranty of the corporate note, Weigand deposited in escrow 3,000 shares of stock in Pizza Corporation of America in the bank and executed an escrow agreement with Jabara and the bank. The escrow agreement provided if the note was paid when due the stock would be redelivered to Weigand. If not, the stock would be delivered to Jabara.
Thereafter, around November 1, 1974, the corporation began having difficulty collecting its accounts receivable which drastically affected its cash flow. As a result, the bank purchased the corporate accounts receivable at a 3% discount and began collecting them under an arrangement they termed a “private label system.” Before purchase of the accounts, the bank loaned the corporation $50,000 on a demand note to be paid in full by December 31, 1974.
On December 13, 1974, the bank debited the corporate checking account in the amount of $35,000 and applied the proceeds to William Dodson’s personal $40,000 note. The bank again debited the corporation account on January 3, 1975, for $5,024.73 and paid the balance on the Dodson note.
On January 10,1975, Dodson requested a new $25,000 loan for the corporation from Richard Goodin, vice-president of the bank’s consumer loan division. At that time, Dodson advised Goodin his personal note had been paid. Goodin made the new loan to the corporation and took its demand note. By January 23, 1975, the $25,000 loan had been reduced to $10,500, and Dodson obtained an additional corporate loan in the amount of $55,000, executing a new demand corporate note for $65,000 and cancelling the previous note for $10,500.
On January 28,1975, the corporation executed and delivered to the bank yet another note in the amount of $5,000 due March 31, 1975.
On March 3,1975, the bank loaned the corporation the $41,400 which is the subject of this litigation. Weigand guaranteed the loan and pledged his Pizza stock as security.
The corporation note to Fran Jabara guaranteed by Weigand and secured by his Pizza stock was due February 23,1975. Jabara demanded to be paid. Dodson spoke with Jack Hinkle, board chairman of the bank, about the bank making the corporation an additional loan of enough to pay off the note to Jabara. Hinkle and Goodin claim they were socializing at The Wichita Club sometime in the last week in February, 1975, when Weigand approached them to state if the bank would loan the corporation funds to retire the Jabara note, Weigand would guarantee the loan and continue the Pizza stock pledge, which was already in escrow at the bank, as security for the bank loan. Hinkle claims he advised Weigand he and Goodin would put the loan through. Weigand made no inquiry about the present amount of outstanding corporate indebtedness to the bank. Weigand testified he did not remember the Wichita Club meeting but that the subject of a $41,400 loan had been discussed earlier that week when Dodson and Weigand had gone to Hinkle’s office to request the loan. Hinkle testified he did not recall any such meeting. Weigand further claims Hinkle told him if he would pledge his Pizza stock the bank would loan the corporation sufficient money to pay the Jabara note. Weigand claims the bank’s actions were done without authority from the corporation, its officers or directors. He claims the bank knowingly concealed these transactions with the intent to deceive him and the transactions hastened the demise of the corporation. In addition, he argues the statements made by Hinkle and Goodin during the holiday season of 1974-1975 regarding the corporation’s financial status were fraudulent statements to induce him to guarantee a note from a corporation known by Hinkle and Goodin to be financially unstable. Weigand requests the court to return his stock to him. In the alternative, he demands judgment for the amount of the note, plus interest, the costs of the action and punitive damages in excess of $10,000.
The bank responded by denying Weigand’s allegations and alleging Weigand, as an officer and director of the corporation, had notice and knowledge, actual and constructive, of all transactions between the corporation and the bank. Appellant states the debiting of the corporate account was authorized by the second financing plan and the transactions were clearly shown on the bank statement sheets which were sent to the corporation. The bank claims Weigand consented to, acquiesced in, approved, ratified and confirmed all transactions of the corporation as its secretary. The bank also alleges that Weigand signed a written instrument certifying to a corporate resolution authorizing Dodson to borrow money from the bank to pay the proceeds of the loans and discounts as directed by Dodson. The bank further alleged it relied on the corporate resolution, loaned the money and extended credit in good faith. Finally, the bank alleged any statements made by Hinkle and Goodin were made as a part of social conversations and were not material facts, merely hopeful opinions regarding the corporation’s financial status. The bank counterclaimed against Weigand for $41,400 and requested that the Pizza stock be sold and applied to the debt.
After a pretrial conference on January 12, 1978, the case was tried to the court on March 28,1978. The court granted judgment to the bank on the question of fraud, but granted Weigand rescission of his guaranty and judgment against the bank on its counterclaim. The bank appealed from that portion of the judgment granting rescission and denying its counterclaim.
The issue before us is whether the bank fraudulently misrepresented the corporation’s financial condition to Weigand, thereby inducing him to guarantee the note. The law with respect to actionable fraud was recently set forth in Nordstrom v. Miller, 227 Kan. 59, 65, 605 P.2d 545 (1980), where the court stated:
“Actionable fraud includes an untrue statement of fact, known to be untrue by the party making it, made with the intent to deceive or recklessly made with disregard for the truth, where another party justifiably relies on the statement and acts to his injury and damage. [Citations omitted.]
“We have held fraud is never presumed and must be proven by clear and convincing evidence. [Citations omitted.] The term ‘clear and convincing evidence’ means:
‘[T]he witnesses to a fact must be found to be credible; the facts to which the witnesses testify must be distinctly remembered; the details in connection with the transaction must be narrated exactly and in order; the testimony must be clear, direct and weighty; and the witnesses must be lacking in confusion as to the facts at issue.’ [Citation omitted.]’’
Did the bank knowingly make untrue statements of material facts, known to be untrue or made with reckless disregard for the truth, which were of such a character that Weigand had a right to rely on them and did rely to his detriment? In Goff v. American Savings Association, 1 Kan. App. 2d 75, 78, 561 P.2d 897 (1977), the court said, “The statement must have been of such a nature that it was reasonably calculated to deceive the Goffs and to induce them to do what they otherwise would not have done.”
The record reveals the following information about Michael C. Weigand: He is 45 years old and is engaged in the real estate business in Wichita as a partner in the firm of J. P. Weigand and Sons. He has been in the real estate business for 21 or 22 years and specializes in developing shopping centers through the firm’s commercial and industrial department. Weigand has been involved with the development of several shopping centers including the Mall, Twin Lakes, Towne East and Pawnee Plaza. As a real estate developer, he supervises salesmen, works with retailers in leasing space, buying land and buildings. His work includes studying contracts and leases, and obtaining financing for clients by working with banks and other lending institutions.
The record also reveals Weigand was not a customer of the Union National Bank as he and his firm have their accounts in other banks. In his capacity as secretary-treasurer of William Dodson Ltd., Inc., Weigand attended the corporate board meet ings, kept minutes, signed the necessary documents for the corporation and kept abreast of its financial affairs. At trial, Weigand testified the corporate accountant, J. Fred Kubik, kept the books but that he had discussed corporate finances with Kubik and saw the Kubik letters of November 9, 1973, and February 1, 1974, setting forth future financial plans for the corporation.
Weigand testified the bank sent the corporation checks, bank statement sheets and deposit slips to the corporate address each month and they were delivered to Kubik, but were available for him to see if he desired. Weigand stated, however, that he didn’t understand such financial matters and his own accountant took care of his personal bank statements for him.
With respect to the bank’s actions in debiting the corporate account in the amount of $40,000 and applying the money to Dodson’s personal indebtedness, we find Weigand to be a successful entrepreneur, trained and experienced in business matters, capable of analyzing contracts and leases. The record reveals he knew from Kubik’s letter of February 1,1974, that Dodson was to receive $40,000 of the accumulated earnings of the corporation after the redemption of Donna Jabara’s stock.
On February 25,1974, Weigand signed an unrevoked corporate resolution giving Dodson complete authority over corporate borrowing, which provided in part:
“FURTHER RESOLVED, That said Bank be and it is hereby authorized and directed to pay the proceeds of any such loans or discounts as directed by the persons so authorized to sign, whether so payable to the order of any of said persons in their individual capacities or not, and whether such proceeds are deposited to the individual credit of any said persons or not.”
The redemption occurred February 26, 1974; the distribution of corporate money took place December 13, 1974, and January 3, 1975. The debit method of distribution, while an irregular technique, could come as no surprise to Weigand. As an officer of the corporation he is charged with knowledge of that plan. A simple inspection of the bank statements would have shed more light on the transaction about which he claims he knew nothing. Additionally, the knowledge Weigand is presumed to have officially as corporate secretary-treasurer, he is conclusively presumed to have as a private individual. 3 Fletcher Cyclopedia Corporations § 836 (1975).
Weigand claims he was not required to perform an extensive examination of the monthly bank statements in order to discover a fact which was concealed from him. He seeks to place himself in the position of the defendant director in Harman v. Willbern, 374 F. Supp. 1149 (D. Kan. 1974). That case dealt, in part, with the extent of a director’s fiduciary duty to the corporation and is not applicable to the present claim of fraudulent concealment of a material fact.
Turning to the statements allegedly made by Hinkle and Goodin, we note there is a dispute as to how many statements were made, where they were made and who initiated them. Weigand states that on two occasions in Hinkle’s office and during one occasion at The Wichita Club, Hinkle stated the corporation was doing well and that he was “proud of Bill Dodson.” Weigand claimed Hinkle told him time and time again that “everything was in good shape.” Goodin is alleged to have agreed with those statements. The circumstances of fraud must be pled with particularity (K.S.A. 60-209[b]) and we cannot say the statements of Hinkle and Goodin rose to the level of clear misrepresentations of material fact. The most that can be said of these statements to Weigand is that they were hopeful opinions about a company Hinkle regarded as being on the upswing. The confidence the two men expressed in the future of the company was reflected in the bank’s attitude toward the company’s financial condition. The bank continued to lend the company money up until May, 1975, only two months before the company closed its doors. This does not suggest a bank conspiracy to induce Weigand to salvage a dying enterprise. The trial court’s finding that the statements were misleading but not fraudulent is based on the fact that the trial court took judicial notice of Hinkle’s good character and reputation for honesty. The trial court believed any opinion rendered by Hinkle as a businessman would carry considerable weight and influence and Weigand would not have signed the guaranty had it not been for Hinkle’s representations regarding the corporation’s financial condition. It is improper for a trial court to take judicial notice of the reputation of a particular individual. 29 Am. Jur. 2d, Evidence § 122. Personal reputation is not a matter of such “generalized knowledge” that it cannot reasonably be the subject of dispute. K.S.A. 60-409. See, e.g., 1 Jones on Evidence § 2:8 (6th ed. 1972).
In Noll v. Boyle, 140 Kan. 252, 255, 36 P.2d 330 (1934), this court quoted with approval the following language from 14a C.J. 100:
“The directors of a corporation are chargeable with knowledge of . . . such corporate affairs as it is their duty to keep informed of, of the financial condition of the corporation; and of facts which the corporate books and records disclose.”
In addition, one who alleges fraud is not entitled to relief if he could have “ascertained the truth by ordinary care and attention and his failure to do so was the result of his own negligence.” 37 Am. Jur. 2d, Fraud and Deceit § 248, p. 330.
We find Michael C. Weigand as a director and secretary-treasurer of William Dodson Ltd., Inc., is chargeable with knowledge of the financial condition of the corporation. In addition, in the absence of detailed knowledge, he could readily have ascertained the corporation’s financial health by reviewing the records entrusted to his care.
Finally, in addition to the fact that the statements did not constitute clear representations of material facts, there is no substantial evidence to show Weigand placed the requisite amount of reliance upon those statements to do what he otherwise would not have done. The scenario appears clear to us: Weigand had guaranteed a corporate note to Jabara in the amount of $30,367 with a pledge of his Pizza stock in 1974. The note came due and Jabara demanded payment. Weigand would have lost his stock unless the note had been paid. The corporation did not have the resources to pay Jabara. Weigand was aware of those facts and sought a bank loan for the corporation in order to salvage his corporate stock. The corporation had given Jabara two notes, the one Weigand originally guaranteed and another for $13,000. The bank agreed to lend enough to discharge both notes and “get Fran Jabara out of the corporation,” if Weigand would guarantee a $41,400 note. Weigand agreed and pledged his Pizza stock. Within a few months the corporation closed its doors and both the corporation and Dodson went bankrupt. Naturally, under such circumstances, Weigand wished to withdraw his commitment.
In Nordstrom v. Miller, 227 Kan. at 65, we stated:
“ ‘The existence of fraud is ordinarily a question of fact.’ An appellate court's review ‘is limited to determining whether the trial court’s finding is supported by competent evidence when that evidence is weighed in a manner most favorable to supporting the trial court’s determination.’ [Citations omitted.] This court is
‘not concerned with the credibility of witnesses or the weight of their testimony, and the trier of facts, not the court of appellate review, has the responsibility of determining what testimony should be believed.’ [Citation omitted.]”
In light of his corporate position which allowed access to all financial information, coupled with the absence of clear and convincing evidence the bank made representations with reckless disregard for the truth we cannot say Weigand was fraudulently induced to guarantee the note to the bank. We hold there is no substantial evidence to support the judgment of the trial court and it is reversed with directions to enter judgment for the Union National Bank in the amount of $41,400 with interest and the costs of the action.
In light of the foregoing, it is unnecessary to rule on other issues presented in the briefs. The judgment of the trial court is reversed.
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The opinion of the court was delivered by
Prager, J.:
This is a juvenile waiver proceeding, brought under K.S.A. 1979 Supp. 38-808, to determine whether Roy D. Edwards, a minor, age 16, is a fit and proper person to be dealt with under the juvenile code. After an extensive evidentiary hearing, the district court waived juvenile jurisdiction and ordered that Edwards be criminally charged and tried as an adult. This appeal followed.
Edwards was charged in juvenile court with seven counts of felony theft (K.S.A. 1979 Supp. 21-3701), five counts of burglary (K.S.A. 21-3715), two counts of aggravated burglary (K.S.A. 21-3716), and two counts of first-degree murder (K.S.A. 21-3401). The charges stem from an alleged crime spree of Edwards and another juvenile, Kenny Crease, in August of 1979. The evidence presented at the hearing showed that the two juveniles committed a series of burglaries and thefts at a number of residences in Wichita during that month. There waff evidence indicating that on August 30, 1979, in the course of a burglary at the Temple residence, the two young men fired weapons killing a married couple who were sleeping at the time. Following the shooting, the two juveniles fled from the house but returned 30 minutes later. Finding no commotion or activity, they reentered the house and took the keys to the Temple car parked in the garage and proceeded to drive the car from the premises.
On(Sunday, September 2, 1979, Edwards was arrested at his home pursuant to a warrant charging him with burglary and theft. He was taken to the sherifFs office and then to an interview room. Edwards was given the Miranda warnings. He stated that he understood his rights and so indicated in writing. The detective advised Edwards that he was being investigated for murder and that it would be best if he told the truth. Edwards then proceeded to make a statement to the detective in which he implicated himself in the Temple burglary and homicide. After one-half hour and a short break, a second interview was held with Edwards. The interviewing detective referred to the prior Miranda warnings, but did not again explain them to him. During this second interview, Edwards admitted committing a number of other burglaries prior to committing the burglary at the Temple home. Both the first and second interviews were taped. A third interview was held and a statement taken on September 4, 1979, at approximately 11:20 p.m. Earlier that day, a petition had been filed in Sedgwick County Juvenile Department, charging him with seventeen felony counts. These three incriminating statements were admitted into evidence at the juvenile waiver hearing. At the hearing, the court heard testimony from a psychiatrist, a psychologist, and a probation officer as to Edwards’ social and psychiatric history and his prospects for rehabilitation. Also the directors of various state juvenile facilities testified as to the programs, conditions, and treatment available at the various facilities. At the conclusion of the hearing, the district judge waived juvenile jurisdiction and directed the district attorney to prosecute Edwards as an adult under the applicable criminal statutes.
Appellant Edwards’ first point on the appeal is that the trial court erred in receiving into evidence his three confessions mentioned above. He contends that where a juvenile is being questioned by the police in connection with criminal acts, in addition to the traditional Miranda warnings required, the juvenile must be specifically advised that his statement can be used against him in an adult criminal prosecution. Appellant argues that, without this additional warning, the admission of a juvenile’s confession violates his right against self-incrimination. Appellant reasons that a juvenile, who is not specifically warned that his statement can be used later in an adult criminal proceeding, is incapable of voluntarily and knowingly waiving his privilege against self-incrimination.
Appellant correctly points out that the rights declared in Miranda v. Arizona, 384 U.S. 436, 475, 16 L.Ed.2d 694, 86 S.Ct. 1602 (1966), weré extended to juveniles by In re Gault, 387 U.S. 1, 18 L.Ed.2d 527, 87 S.Ct. 1428 (1967). In Gault, the United States Supreme Court recognized the problems involved with a juvenile waiver of constitutional rights, charging the courts to first ascertain whether the admission was voluntary, and “not the product of ignorance of rights or of adolescent fantasy, fright or despair.” p. 55. This court has, likewise, been concerned with the problem of a juvenile’s voluntary and knowing waiver of his right against self-incrimination. State v. Young, 220 Kan. 541, 552 P.2d 905 (1976); State v. Oberst, 127 Kan. 412, 273 Pac. 490 (1929).
The exclusionary rules, pertaining to illegally obtained confessions, have been considered equally applicable to waiver proceedings in juvenile courts, as to juvenile proceedings or criminal trials. See e.g., State v. Strickland, 532 S.W.2d 912 (Tenn. 1975). In J.T.P. v. State, 544 P.2d 1270 (Okla. Crim. 1975), the Oklahoma court held that proceedings to certify a minor to stand trial as an adult were “comparable in seriousness to criminal prosecution,” and, therefore, must comply with the essentials of due process and fair treatment. The court further held that statements which would be inadmissible in juvenile proceedings or criminal trials were, likewise, inadmissible in certification proceedings. In In re Harris, 218 Kan. 625, 629, 544 P.2d 1403 (1976), this court, like the Oklahoma court, viewed a waiver hearing to be so closely related to a specific criminal prosecution that the same policy considerations are applicable. We have concluded that statements which are inadmissible in other juvenile proceedings or in criminal trials are likewise inadmissible in juvenile waiver proceedings.
Having determined that any incriminating statements of Roy D. Edwards must have been voluntarily obtained before becoming admissible in his juvenile waiver proceeding, we must next consider appellant’s contention that his confessions were not voluntary because the Miranda warnings given did not include a specific additional warning that any statement given might be used in adult proceedings subsequently brought against him. It should be noted that prior to making a statement, Edwards was advised that any statement he made could be used against him in court. The issue presented has been raised in a number of jurisdictions and it has consistently been held that, although the juvenile must be made aware that criminal prosecution as an adult is a possibility, he need not be specifically warned that any statements given might be used in adult criminal proceedings. In State v. Luoma, 88 Wash. 2d 28, 558 P.2d 756 (1977), the juvenile defendant, seventeen and one-half years old, was charged with murder. He was given the traditional Miranda warnings at various times after which he made incriminating statements. The court held that where the criminal ramifications were obvious, the defendant was charged with notice that any statements given after the Miranda warnings could be used in an adult criminal proceeding. Factors making criminal prosecution obvious included not only the age, intelligence, and experience of the juvenile, but also the patently adversary setting of the interrogation in the police station. Defendant was charged with the knowledge that criminal prosecution was likely in view of the seriousness of the criminal charge and the custodial questioning at the jail. The same holding and rationale has been followed by other appellate courts: People v. Prude, 66 Ill. 2d 470, 6 Ill. Dec. 689, 363 N.E.2d 371, cert. denied 434 U.S. 930 (1977); State v. Loyd, 297 Minn. 442, 212 N.W.2d 671 (1973); In Interest of A.D.R., 515 S.W.2d 438 (Mo. 1974); State v. Gullings, 244 Or. 173, 416 P.2d 311 (1966).
In State v. Hall, 350 So. 2d 141, 144 (La. 1977), the court rejected the contention that a juvenile was entitled to a specific warning that statements might be used in an adult criminal proceeding in addition to the Miranda admonitions. In so holding, the court held that there “is no constitutional requirement that a juvenile be instructed as to the courts in which he may be tried or the potential penalties which may accompany his offense before he can waive his Miranda rights and make a free and voluntary confession.” See also State v. Mattox, 113 Ariz. 252, 550 P.2d 630 (1976). The cases cited by appellant in his brief do not recognize a different rule. They simply hold that under the totality of the circumstances in the particular case, the juvenile had not knowingly and voluntarily waived his privilege against self-incrimination.
This State has adopted the “totality of the circumstances” test in determining whether a juvenile voluntarily and intelligently waived his right against self-incrimination. In State v. Young, 220 Kan. at 546-547, this court listed the relevant factors to include the juvenile’s age, the length of the questioning, the juvenile’s educational level and mental ability, his prior experience with the police, and his mental state at the time of his arrest. Applying the legal principles discussed above to the factual circumstances in this case, we find that it was not error for the trial court to hold that the appellant voluntarily and intelligently waived his right against self-incrimination in making the statements to the police officers. The appellant was sixteen and had previously been processed through the juvenile system. When arrested, the appellant asked if he was being taken to the juvenile detention center and was told that he had made the big time and was being taken to the county jail. The appellant was repeatedly read the Miranda warnings and told to ask questions if he did not understand them. He indicated that he understood his rights and that he wished to talk with the police. The gravity of the offense and the custodial, jailhouse interrogation would impute to appellant knowledge of the adversary nature of the proceedings against him. Furthermore, the court received testimony that the appellant was of average intelligence. Under the totality of the circumstances, appellant must be considered capable of knowingly and intelligently waiving his right against self-incrimination.
The appellant also complains that the trial court erred in considering his third statement made to the police, because, at that time, although counsel had been appointed for him, he had not received notice of the appointment. Appellant argues that once counsel has been appointed, any statement taken from the accused is inadmissible in subsequent proceedings unless counsel is given notice and a reasonable opportunity to be present when the statement is taken. The trial court rejected appellant’s contention, finding that the police officer made a reasonable attempt to ascertain if counsel had been appointed by checking with the sherifFs office and was advised that none had been appointed. The trial court also found that although counsel had been called and requested to represent appellant, the documents necessary to formalize the appointment were not to be signed until later that afternoon which was after the appellant’s third statement was obtained. We have concluded that the admission of the third statement of the appellant was not reversible error. The arresting officer made a reasonable inquiry to ascertain whether or not counsel had been appointed for Edwards and was advised in the negative. The appellant did not request the presence of counsel, though he had previously been advised of that right. The absence of counsel in this case did not as a matter of law render statements made to the police involuntary. Furthermore, the admission of the third statement would be harmless error in any event, since the appellant made a full confession of his criminal activities in the first two statements obtained before the court had ever considered the appointment of counsel. We find no error on this point.
The appellant’s final point on the appeal is that the trial court erred in finding that he was not a fit and proper subject to be dealt with under the juvenile code. Appellant specifically claims error in the trial court’s finding that there were no Kansas juvenile facilities available for the proper treatment of the appellant. In ruling that appellant was not a fit and proper person for treatment under the juvenile code, the trial court stressed the inadequacies of the juvenile system in providing rehabilitative treatment for older juvenile offenders. The trial court’s determination that there was no facility available for proper rehabilitative treatment was based in part on the trial judge’s conclusion that the committing court could not require the juvenile facility, or the Secretary of Social and Rehabilitative Services to whom the delinquent or miscreant juvenile is committed, to keep the appellant locked up until age twenty-one or until the committing court was satisfied the juvenile was successfully rehabilitated. K.S.A. 1979 Supp. 38-826c. The trial court was of the opinion that the appellant would probably not remain in a juvenile facility long enough to complete the necessary treatment and the interests of the community, therefore, required that he be processed as an adult. It cannot be said, however, that the trial court based its decision solely on that conclusion. There was some evidence that the necessary treatment for appellant would not be available through the juvenile rehabilitative system. As stated in In re Ferris, 222 Kan. 104, 112, 563 P.2d 1046 (1977), “appellant mistakenly attempts to equate availability of institutions with institutions suitable for his rehabilitation.”
Appellant also contends that the trial court, in making its ruling on the record, failed to enumerate two of the seven factors outlined in K.S.A. 1979 Supp. 38-808(b), and thus committed reversible error in failing to consider all factors mandated by the legislature. In his ruling, the trial court did not specifically discuss factors three and five relating to the maturity of the juvenile and his past history. While the above factors would seem to support the juvenile’s amenability to treatment within the juvenile system, the statute does not require each factor to receive equal weight. To the contrary, 38-808(h) specifically states that the insufficiency of the evidence pertaining to any one or more of the factors listed in the subsection shall not in and of itself be determinative of the issue. The trial court placed great weight on the severity of the offense, the interests of the community, and the lack of facilities capable of providing the necessary treatment for the appellant. Considering all of the evidence presented at the hearing, we find that there was substantial competent evidence to support the findings of the trial court and that the trial court did not err in holding that Edwards was not a fit and proper person to be dealt with under the juvenile code.
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The opinion of the court was delivered by
Prager, J.:
This is a direct appeal in a criminal action from a conviction of felony murder (K.S.A. 21-3401). This case was before this court on appeal in State v. Foy, 224 Kan. 558, 582 P.2d 281 (1978). On the first appeal, the case was reversed and remanded for a new trial. After remand, the case was transferred to Sedgwick County and tried to a jury.
The evidence presented at the second trial did not substantially differ from that offered in the first trial except the defendant, Roger D. Foy, did not take the stand as he did in the first trial. The evidence was undisputed that the defendant Foy killed his wife, Sharon Foy, with a shotgun at the home and in the presence of Sharon’s mother, Grace Kreulhous, in Dodge City. Sharon and Roger Foy had been married for approximately twelve years. During this time their marriage was characterized by frequent arguments, physical violence, and separations. Prior to January 1976, the two were divorced, but then resumed living together in the home of Sharon’s mother. On January 1, 1976, Sharon went drinking with some friends, and ended up at a party in a trailer where she continued to drink. The defendant having searched for her, later entered the trailer and began slapping and kicking her around. The owner of the trailer ordered defendant to leave at gunpoint. The following day, Sharon filed a complaint against Roger Foy charging battery. At that time, defendant moved out of Grace Kreulhous’ house and moved in with Sharon’s half brother. Thereafter, Sharon and Roger continued to see each other during the separation. He tried to reconcile with her. There was testimony that Grace and defendant did not get along and that one of the major problems between Sharon and defendant was Sharon’s divided loyalty. During one of these separations, defendant stated that he would kill Sharon. At other times he talked of killing Grace; he also talked of killing himself.
On January 20, 1976, Roger D. Foy was served with the papers charging him with the New Year’s Day battery of Sharon. He called Grace’s house numerous times on that day, trying to talk with Sharon. At times he talked to Sharon and then Grace; both told him that they would try to help him, if he quit drinking. In the early evening on January 20, 1976, Roger Foy approached Steve Smith in his truck at a drive-in in Dodge City. Defendant got into the truck and began to assemble a sawed-off shotgun. When he was asked what he was going to do with it, he stated that he was going to blow the old lady away or words to that effect. At the defendant’s insistence, Smith drove him to Grace’s house.
Grace Kreulhous testified that she was present when defendant entered her home. He yanked the door open and entered without her permission. Defendant asked Sharon to go talk with him in Sharon’s car. Sharon replied, “Roger, you know you are not supposed to be in Mama’s house. And if you don’t leave, we are going to have to call the law.” Grace testified that she got up from the chair in which she had been sitting to phone the police. As she was walking down the hall, she heard Sharon say, “Don’t Roger,” or “Please don’t.” She turned to see defendant pointing a gun at Sharon. She did not actually see defendant pull the trigger but heard a “pop” and saw a “flash.” The shotgun blast struck Sharon on the left side of the face, killing her. The defendant then shook the gun before throwing it down beside Sharon’s body. The defendant mumbled something like, “You asked for it,” then “You will be next,” or “You and' the kids will be next.” The defendant then ran or walked quickly out the door.
After leaving Grace’s house defendant went by the home of a lady friend, Lois, and asked her to drive him to Wichita. The two of them left in her car, drove to Wichita, and went to the home of Kenneth Cupp. The defendant then told Cupp what had happened, and the two decided defendant should go to a motel to get some rest. The defendant and Lois then went to a motel, where the defendant was arrested. The defendant was convicted of felony murder and has appealed to this court claiming a number of trial errors. Other facts necessary for determination of an issue will be provided in discussing that issue.
The defendant’s first point on the appeal is that the trial court erred in permitting the State to amend its information to allege felony murder less than a week before the trial and in permitting the State to assert a felony-murder theory at the trial. Additional facts deemed important to this issue are as follows: The defendant was originally charged with premeditated murder. He was convicted September 30, 1976, of felony murder. This conviction was reversed and remanded July 21, 1978. Apparently defendant’s counsel and the county attorney had had some discussion and the county attorney had indicated he did not intend to rely upon the theory of felony murder at the second trial. The county attorney apparently changed his mind. On September 25, 1978, he sent a letter to defense counsel of his intent to amend the information. On September 26, 1978, the State filed a motion to include in the information, as a second count, a charge of felony murder during an aggravated burglary (K.S.A. 21-3716), as an alternative count to the original charge of premeditated murder. The motion to amend was sustained, but the State was required to furnish a bill of particulars setting forth in detail the testimony to be relied upon to prove felony murder. The amendment was made on September 27, 1978. The bill of particulars was furnished the following day. Trial commenced on October 2, 1978, and the jury impaneling was completed on October 4, 1978. After hearing the evidence, the jury was instructed on first-degree murder and felony murder in the alternative, and the verdict of felony murder was returned on October 10, 1978.
The defendant contends that defense preparation was prejudiced because of counsel’s reliance on the statement of the county attorney that the State would not rely on felony murder. Defense counsel argues that, because of the late amendment, he did not have time to prepare a defense for the felony-murder charge. We find the defendant’s contention on this point to be without merit. K.S.A. 1977 Supp. 22-3201(4) specifically authorizes a trial court to permit amendment of an information any time before a verdict so long as no different or additional crimes are charged, and the rights of the accused are not prejudiced. Prior to trial, the prosecution is given wide discretion in amending the information as to form and substance. State v. Smith, 225 Kan. 796, 798, 594 P.2d 218 (1979). We do not see how defendant here could have been prejudiced in any way in the preparation of his defense as a result of the amendment to the information. An amendment to the information was not actually necessary, for an information in the ordinary form charging that a killing was done with malice aforethought, deliberation, and premeditation is sufficient to sustain a conviction of murder in the first degree committed in the perpetration of a burglary. State v. Foy, 224 Kan. at 566. The evidence presented at the second trial was essentially the same as that presented in the first trial. The defendant did not ask for a continuance because of the amendment. Furthermore, the State was required to furnish to the defendant a bill of particulars fully setting forth the evidence the State intended to rely on to prove felony murder. Since the defendant has failed to demonstrate any prejudice because of the amendment of the information, the defendant’s first point must fail.
The defendant next maintains that he was denied a fair trial because Judge Robert M. Baker, who presided in the case, should have recused himself in response to the defendant’s affidavits and motions for change of judge, and that the assigned judge, Honorable Bert J. Vance, erred in finding the defendant’s affidavits for change of judge to be legally insufficient and untimely filed in his order overruling defendant’s motion for change of judge. As noted heretofore, the defendant Foy was convicted of felony murder on September 30, 1976. He appealed to the Supreme Court. On June 26, 1978, while the defendant’s first appeal was pending, Judge Baker appeared at a hearing before the Board of Commissioners of Ford County where there was a public discussion of the cost of prosecutions in criminal cases. The affidavit of defendant stated that Judge Baker, at this meeting, complained about the rights afforded indigent defendants, their cost to the judicial system, and their expectations for “getting sprung” by their court-appointed attorneys. Apparently Judge Baker also stated that the courts today are conducted for the convenience of the criminals, that all they have to do is to have one infinitesimal mistake to appeal, that rehabilitation is a bust, and that criminals expect to change attorneys like they change their shirts. On July 21, 1978, the defendant’s conviction in the first trial was reversed and remanded to the district court. A written order was entered setting the case for a second trial. The defendant was returned to Ford County to await retrial on August 17, 1978. Shortly thereafter, defense counsel informed Judge Baker that an affidavit and a motion for a change of judge would be filed by the defendant. An affidavit and a motion for change of judge were not actually filed until September 14, 1978, forty-nine days after Judge Baker’s order setting the date for defendant’s new trial and twenty-seven days after the defendant was returned to Ford County jail. Judge Baker was the only resident district judge in the Sixteenth Judicial District. Since the associate district judge, Jay Don Reynolds, had been special prosecutor in the first trial, the Honorable Bert J. Vance, district judge of the Twenty-Fifth Judicial District was assigned to consider the affidavit and motion for change of judge. On September 20, 1978, a hearing was held on the motion by Judge Vance. At the conclusion of the hearing, Judge Vance ruled that the affidavit was not sufficient to disqualify Judge Baker. In doing so, he reasoned that a disqualification of Judge Baker for bias and prejudice would have to be on the basis of personal bias or bias against the defendant and that Judge Baker’s general statement as to what the law ought to be or his criticism of certain principles of law did not constitute personal bias on the part of the judge. In so ruling Judge Vance stated as follows:
“That type of statements do not constitute personal bias on the part of the fudge. All judges, all lawyers and I suspect most people have opinions as to what the law should be, and many people disagree with some propositions of law that have been our law for many years, and I don’t think that this affidavit shows the type of personal bias that would disqualify a judge. It does not show that the judge won’t give the man a fair trial, and from the statements made he could not logically and reasonably arrive at a conclusion the judge could not give him a fair trial, so I am going to hold as a matter of law the affidavit is insufficient.”
In addition, Judge Vance found that the affidavit of prejudice has been filed out of time and was also insufficient for that reason.
Having failed to disqualify Judge Baker on the first affidavit, defense counsel on September 27, 1978, filed a second affidavit of prejudice against Judge Baker based upon a letter which Judge Baker had written to the county attorney on September 26,1978, a copy of which was sent to defense counsel, suggesting that, if the State was intending to rely on a charge of felony murder at the forthcoming trial of the case, the State should amend the information to charge felony murder. In his affidavit, the defendant stated in substance that he believed personal bias and prejudice of Judge Baker prevented him from getting a fair trial because the letter constituted advocacy of the judge in favor of the State. Judge Vance was quickly called back to Dodge City to hear this affidavit and motion for disqualification. A hearing was held on September 29, 1978. Judge Vance considered the affidavit and denied the motion, concluding that the letter was simply a suggestion by the judge to make the trial run smoother and, to avoid a procedural problem, it is a proper function of a trial judge to notify counsel of the problem. On this appeal, the defendant maintains that Judge Baker was disqualified to sit as trial judge at the second trial as a matter of law and, therefore, defendant should be granted a new trial.
The Kansas statute providing for the disqualification of a trial judge was K.S.A. 20-311d which was interpreted by the court in Hulme v. Woleslagel, 208 Kan. 385, 493 P.2d 541 (1972). In Hulme, the issue was whether or not an affidavit charging bias and prejudice against a party’s counsel furnished grounds for disqualification of a judge. Noting the split of authority on that issue, the court concluded that bias or prejudice toward a party’s attorney may be a ground for disqualification under the statute. The prejudice asserted in the affidavit in this case concerned Judge Baker’s general attitude toward the administration of the criminal law and certain rights afforded persons charged with crime. We interpret the affidavit to refer to views the judge had demonstrated toward the subject matter of criminal law and procedure, including his expressed opinion on certain legal questions.
The rule generally followed throughout the United States is that the words “bias” and “prejudice,” as used in connection with the disqualification of a judge, refer to the mental attitude or disposition of the judge toward a party to the litigation and not to any views that he might entertain regarding the subject matter involved. Bias and prejudice mean a hostile feeling or spirit of ill will against one of the litigants, or undue friendship or favoritism toward one. State, ex rel., v. Sage Stores Co., 157 Kan. 622, 625, 143 P.2d 652 (1943). See also 46 Am. Jur. 2d, Judges §§ 167 and 168 and the many cases cited therein. K.S.A. 20-311d(b)(5) specifies that personal bias, prejudice, or interest is ground for disqualification. This requires antagonism and animosity toward the affiant or his counsel or favoritism towards the adverse party or his counsel. “Personal bias” is to be distinguished from “judicial bias,” and does not include views based upon matters arising during the course of the litigation or upon general attitudes common to the public generally. Views relating to legal questions, even strongly-held views in favor of law enforcement, do not amount to personal bias. United States v. Nehas, 368 F. Supp. 435 (W.D. Pa. 1973); Knapp v. Kinsey, 232 F.2d 458, 466 (6th Cir. 1956); Antonello v. Wunsch, 500 F.2d 1260 (10th Cir. 1974).
This court has held that in a criminal action the mere belief on the part of the trial judge that the accused is guilty of the crime charged is not enough in itself to require a disqualification. The question is not whether the trial judge believes the accused guilty, but whether the trial judge can give him a fair trial. State v. Hendrix, 188 Kan. 558, 363 P.2d 522 (1961); State v. Cole, 136 Kan. 381, 15 P.2d 452 (1932). We agree with Judge Vance that the statements made by Judge Baker at the meeting of the Board of County Commissioners of Ford County on June 26, 1978, simply involved general statements of opinion as to what the law should be and some disagreement with certain existing legal procedures. We cannot say that these general statements constituted a statement of personal bias either against defendant Foy or his counsel in this case. Hence, we conclude that Judge Vance was correct in denying a change of judge on that affidavit.
As to the second affidavit filed on September 27, 1978, we also agree with Judge Vance that the statements in the affidavit were not sufficient to require a change of judge. We interpret Judge Baker’s letter as simply a suggestion to the county attorney that the information be amended to specifically charge felony murder in the event the State intended to rely upon that charge. A copy of the letter was sent to defense counsel. As noted under the first point, an amendment of the information was not legally required in order to prosecute defendant Foy on a theory of felony murder. The original charge of premeditated murder was sufficient in itself to support a conviction for felony murder. We, thus, conclude that Judge Vance did not err in overruling the defendant’s motion for change of judge.
As to the defendant’s contention that Judge Baker erred in failing to recuse himself in response to the defendant’s affidavit and motion for change of judge, we, likewise, hold that such refusal does not constitute reversible error. It must be remembered that Judge Baker was the trial judge at the original trial of this case. No claim has been made, nor does the record indicate, there was prejudice in the manner in which Judge Baker presided at that trial. Judge Baker was the only resident district judge in the judicial district who could preside at the second trial, since associate district judge Jay Don Reynolds had been special prosecutor in the case at the first trial. Judge Baker certainly had gained a great deal of insight and knowledge about the case at the first trial and undoubtedly felt it was his judicial duty to proceed. Although he might well have recused himself, we cannot say that he committed error or abused his discretion in failing to do so.
The defendant next maintains that the actual conduct of Judge Baker at the trial reflected bias and prejudice toward defendant and, therefore, defendant was denied a fair trial. We have considered each of the complaints asserted by the defendant and find them to be without merit. We have very carefully gone over the trial record in the case and are convinced that, as far as the judge’s demeanor is concerned, the defendant was afforded a fair trial. Defendant complains of a certain remark made to defense counsel in chambers, out of the hearing of the defendant and the jury. This has given this court some concern. The remark was intemperate, crude, and discourteous. This remark, however, was never brought to the attention of the jury and, in our judgment is completely out of character when compared with the demeanor and attitude of the judge demonstrated before the jury and at post-trial hearings. On all occasions, Judge Baker treated counsel, the defendant, witnesses, and the jury with courtesy and consideration. We note, for example, that following the defendant’s conviction, at defense counsel’s request, Judge Baker requested a post-trial investigation on Mr. Foy and also requested counsel to submit a suggested program of rehabilitation for the defendant. Furthermore, the court was particularly considerate in granting defendant’s counsel an additional fifteen days after submission of the trial transcript to file a motion for a new trial in the case. The usual statutory procedure requires that defendant file a motion for a new trial within ten days after the verdict of guilty (K.S.A. 22-3501).
The other incidents complained of by defense counsel in his brief do not, in our judgment, constitute either a demonstration of Judge Baker’s bias and prejudice or constitute justification for reversal of the case. At one point, the judge suggested to the assistant county attorney that he rephrase a question in a certain manner. This suggestion to an attorney, only recently admitted to the bar and inexperienced in trial advocacy, does not carry the sinister implication suggested by defense counsel. Likewise, the questions directed by the court to defendant, asking him if his counsel’s waiver of opening statement and the resting of the defense’s case was with defendant’s, permission, was consistent with the court’s actions at other times during the trial. We cannot believe that such actions on the part of the trial judge could have affected the outcome of the trial so as to justify a reversal of the case.
The defendant next complains that the court erred in admitting the testimony of certain State witnesses over defendant’s objection. Defendant objected to certain testimony given by Grace Kreulhous which was elicited by the prosecutor shortly after she took the stand. During preliminary questions by the State, she was asked if there had been any changes in her health since witnessing the death of her daughter on January 26, 1976. This question was objected to and overruled. It is obvious that court and counsel were concerned that Mrs. Kreulhous might break down during the trial. During both direct and cross-examination, inquiry was made by counsel if she was all right or if she needed to rest. We cannot say that it was prejudicial error for the court to permit the question to be asked of the witness. In view of the fact that her testimony was highly emotional and she wept many times during her examination by counsel, it is unlikely that the question in regard to her health could have affected the outcome of the case.
Defendant complains of certain testimony given by KBI agent Hugh Kizer, a forensic expert for the KBI. He performed various tests on the shotgun which killed Sharon Foy. The State questioned the witness as to the normal firing position of a person’s hand on the shotgun and whether an injury to defendant’s hand could have been caused by the kick of the gun on discharge, if the gun had been intentionally discharged. Defendant objected to this line of questioning as being within the common experience of laymen, and therefore, was not a proper subject for expert opinion. In our judgment, the witness’s special knowledge about the operation of the weapon’s firing mechanism and the effect of recoil would be helpful to the understanding of the jury. We find no error in the admission of this testimony. Finally, the defendant contends that it was error to admit the testimony of Lois, defendant’s lady friend, involving the defendant’s attempt to have sexual relations with her on the night of the shooting and during their drive in the automobile to Wichita. This was offered by the State to show the defendant’s demeanor and conduct after the shooting and his state of mind. We believe that this evidence was relevant on the issue of defendant’s state of mind and that it was not error to admit it.
The defendant next complains of certain errors in the instructions given by the court. We have examined the instructions and find that they are fair statements of the law. The instruction defining felony murder was submitted to defense counsel prior to the court’s instructing the jury, and he stated that he had no objection to it. We cannot say that the instruction was manifestly erroneous. Likewise, the other instructions do not justify reversal of the case.
The defendant’s last two points are that the trial court erred in overruling defendant’s motion to dismiss and for a directed verdict of acquittal at the close of the State’s case-in-chief, and that the trial court erred in overruling the defendant’s motion for a new trial. We find these points, likewise, to be without merit. The record shows clearly that counsel for both the State and the defendant demonstrated high professional competency in representing their clients at the trial. The evidence in the case was practically undisputed that the defendant, having obtained a shotgun and expressing his intention to kill his wife, went to his mother-in-law’s home, entered the home without her consent, and shot his wife. Frankly, it is difficult to see how the jury could have reached a different result than was reached at the second trial in this case. We find no basis for holding that the evidence was insufficient to sustain guilt or that there is any reason to grant a new trial in this case.
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The opinion of the court was delivered by
Prager, J.:
This case involves a dispute between Ameq, Inc., a property owner, and the board of county commissioners of Johnson County over the amount of the assessment of certain real estate for ad valorem tax purposes. The Johnson County officials appealed to the district court from an order of the board of tax appeals granting relief to Ameq in proceedings filed by Ameq pursuant to K.S.A. 79-2005 seeking repayment of taxes paid under protest.
The facts in the case are not disputed and essentially are as follows: Ameq, claiming an excessive evaluation, paid its 1976 real property taxes under protest in accordance with K.S.A. 79-2005. Ameq filed a timely application for a hearing with the State Board of Tax Appeals (BOTA). BOTA heard the protest on April 7, 1977, and, on June 15, 1977, determined the property evaluation to be excessive. It ordered a reduction of the tax with a refund of the excess taxes paid. On July 11, 1977, the Johnson County officials filed a notice of appeal with BOTA in accordance with K.S.A. 60-2101(d). The appeal was docketed in the Shawnee County District Court on July 19, 1977. Ameq filed a motion to dismiss the appeal for want of jurisdiction on the ground that K.S.A. 60-2101(d) was not an available procedure for judicial review of BOTA orders involving the payment of taxes under protest made pursuant to K.S.A. 79-2005. The trial court sustained the motion, concluding that the proper venue was in Johnson County and that the proper statutory remedy for an appeal was under K.S.A. 74-2426. The county officials have appealed to this court from the order dismissing their appeal.
The basic issue for determination on the appeal is whether K.S.A. 60-2101(d) affords to county taxing officials an appeal from an order of BOTA granting relief to a taxpayer in a protest action filed pursuant to K.S.A. 79-2005. The district court held that K.S.A. 74-2426 was the proper statute to be used for judicial review in this case. That statute requires an appeal to be taken to the county where the land is situated, which in this case is Johnson County rather than Shawnee County. We have concluded that the trial court correctly dismissed the appeal. However, the court was in error in holding that an appeal was afforded under the provisions of K.S.A. 74-2426. This court has consistently held that K.S.A. 74-2426 affords an appeal to the district court only in cases which originate elsewhere and are appealed to BOTA. That statute does not afford an appeal to the district court in proceedings brought originally before BOTA. Union Pacific Railroad Co. v. Sloan, 188 Kan. 231, 361 P.2d 889 (1961); City of Kansas City v. Jones & Laughlin Steel Corp., 187 Kan. 701, 360 P.2d 29 (1961). The county officials contend that those cases are no longer the law, K.S.A. 74-2426 having been amended since those cases were decided. The statutory language in K.S.A. 74-2426, which allows district court review of a BOTA order in any appeal, has survived despite the legislative opportunities for amendment. Although K.S.A. 74-2426 was amended in 1969, 1971, 1972, and 1978, in none of those amendments did the legislature consider it desirable to change the statutory language to correct the judicial interpretation in the cases cited above. Hence, we hold that K.S.A. 74-2426 does not afford a right of appeal in a protest action filed originally in the board of tax appeals pursuant to K.S.A. 79-2005.
We have likewise concluded that K.S.A. 60-2101(d) is not an available procedure for appeal in this case, because, in matters involving the valuation of real property for assessment purposes, the board of tax appeals is acting administratively, not judicially or quasi-judicially. It is important to note that the language of K.S.A. 60-2101(d) permits an appeal from a judgment rendered or a final order made by an administrative board or officer only when that board or officer is exercising judicial or quasijudicial functions. Matters of assessment for taxation are administrative in nature, not judicial or quasi-judicial. Vaughn v. Martell, 226 Kan. 658, 603 P.2d 191 (1979); In re Chicago, R. I. & P. Rly. Co., 140 Kan. 465, 37 P.2d 7 (1934); Symns v. Graves, 65 Kan. 628, 70 Pac. 591 (1902).
As noted above, this case involves an original proceeding filed in the board of tax appeals pursuant to K.S.A. 79-2005. That statute specifically provides for and controls the right of action in the district court in cases where taxpayers pay their taxes under protest. K.S.A. 79-2005(2) provides in part as follows:
“(2) Every taxpayer protesting the payment of taxes, within thirty (30) days after filing his or her protest shall either commence an action for the recovery thereof in some court of competent jurisdiction, or file an application with the state board of tax appeals, . . . for a hearing on the validity of such protest. . . .
“No action shall be brought or maintainable in any court for the recovery of any taxes paid under protest unless the same is commenced within thirty (30) days after the filing of such protest with the county treasurer, or, in case application shall have been filed with the board as hereinbefore set out, unless the same is commenced within thirty (30) days after the date the board mailed its order on such protest to such taxpayer.”
It is clear that K.S.A. 79-2005 affords the exclusive remedy available for review in cases where taxes are paid under protest. No appeal is provided county taxing officials in that statute. The taxpayer may either file an action directly in the district court or, in the alternative, file an application for a hearing with the state board of tax appeals. If the state board of tax appeals grants relief to the taxpayer, and he is satisfied, that ends the matter, since K.S.A. 79-2005 does not give to county officials the right to appeal to the district court in such cases. Sprague Oil Service v. Fadely, 189 Kan. 23, 367 P.2d 56 (1961). If the taxpayer is not satisfied with the order made by the board of tax appeals, he has a remedy by filing an action directly in the district court.
For the reasons set forth above, we have concluded that the district court of Shawnee County was correct in dismissing the appeal of the Johnson County officials in this case, since no right of appeal was afforded them either under K.S.A. 74-2426, 60-2101 (d), or 79-2005.
The judgment of the district court is affirmed. | [
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