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The opinion of the court was delivered by
Fromme, J.:
This action was brought to recover the balance due on a promissory note executed by Dale E. Dickson, and which Robert L. Ard assumed and agreed to pay in a separate written instrument. Dickson set up the defense of novation based on the separate written instrument signed by Ard. Ard set up a defense of failure of consideration for his agreement to assume the debt. The defendant Dickson in his answer to plaintiff’s petition pled that the written instrument entitled “Memorandum of Stock Sale,” which will hereafter be copied in full, constituted the novation. During the trial he neither relied upon nor attempted to introduce parol testimony to prove that he understood he would be released from his obligation on the note in exchange for the obligation of Ard under the memoradum.
The case was submitted to a jury on two special questions: (1) Was there a novation? (2) Was there a failure of consideration? The jury answered both questions in the affirmative and the trial court entered judgment against the plaintiff which judgment had the effect of releasing both Dickson and Ard from any liability on the note. The holder of the note appeals.
In order to examine the questions raised on appeal the factual background must be given.
The plaintiff trustee is the present legal holder of the promissory note in question. He obtained title by transfer from the original payees. No question is raised concerning ownership, and the trustee now stands in the shoes of his parents, Henry J. and Gladys A. Davenport. The Davenports owned and managed the Davenport Equipment Company, an incorporated retail farm equipment business in Osage City.
In 1963 the business was sold by the Davenports to Dale E. Dickson and Roe E. Borsdorf under a written sale agreement. The Davenports completely withdrew from the business and the two purchasers took over the operation and management. All shares of stock in the corporation were assigned to the purchasers. The purchasers executed separate promissory notes to cover their share of the purchase price of the business. The Borsdorf note has since been paid in full. The Dickson note dated January 19, 1963, is the basis of the present action. It obligated Dickson to pay the principal sum of $9,855.20 in monthly installments of $100.00 principal plus interest over a period in excess of 8 years with prepayment privileges. The note was secured by the pledge of Dickson’s shares of corporate stock and an account receivable of the company. The certificates of stock were placed in the hands of an attorney, Harry T. Coffman, who was given a power of attorney by Dickson and the Davenports to carry out the terms of the pledge. In event of default the entire remaining balance on the note became due and payable at the holder’s option.
Dickson made regular payments on his note until December, 1965, at which time there remained due a balance of principal of $6,703.41. No further payments were made by Dickson.
In April, 1967, when some seventeen monthly payments were in default Dickson negotiated for the sale of his interest in the business to Robert L. Ard. The business was in financial straits. Ard was a mechanic working for the company. On April 22, 1967, a meeting was held in the company office. Those in attendance were Dale E. Dickson, Roe E. Borsdorf, Robert L. Ard, Bertram E. Davenport, Harvey Davenport, Gladys A. Davenport and Harry T. Coffman, an attorney representing Gladys Davenport. The proposed sale of Dickson’s interest to Ard was discussed and a written memorandum was signed. This memorandum which is alleged to have effected a novation is as follows:
“Memorandum of Stock Sale
“4-22-67
“Whereas, the unpaid principal balance of the undersigned Dale E. Dickson’s 1-19-1963 $9,855.20 note to Mr. or Mrs. Henry J. Davenport or the survivor of them (Mrs. D.) is $6703.41 and the interest is unpd since 12-19-1965; the $11,138.28 acc’t receivable by the Davenports from Davenport Equipment Company is not paid and no interest has been paid thereon and the 43 shares of seller Dale E. Dickson’s stock in the company is encumbered only by its pledge to secure the payment of said 1-19-1963 note; and there are 63 shares of stock owned by Roe E. Borsdorf, the only other stockholder;
“Now, therefore, in consideration of these mutual covenants — the parties agree—
“1. Dale E. Dickson & wife Ann will forthwith resign from the Board of Directors of the company and Dale will resign from the office of President.
“2. Dale E. Dickson will assign his 43 shares of stock to the undersigned Robert Ard, who assumes the obligation of said note and will pay the balance of it (Principal and interest) if Mrs. Davenport will let him pay the interest to date and resume payment of the balance on a $100 — per month pr -{- interest schedule.
“3. Dale E. Dickson assigns his interest in said $11,138.28 account to Robert Ard subject to the dedication of it to pay the note — all per the 1-19-63 contract and pledge.
“Approved 4-22-67 /s/ Dale E. Dickson
/s/ Mrs. Gladys Davenport /s/ Robert L. Ard”
Robert L. Ard thereafter made two payments to Gladys A. Davenport, who was the owner and holder of the Dickson note during that time. In May, 1967, a payment on the note of $445.89 was credited against the past due interest and in June, 1967, a payment of $127.46 was credited to principal and interest. A schedule of payments had been kept on the Dickson note from its inception, and these last two payments by Ard were endorsed or credited on the Dickson note schedule to reduce the running, balance due on the note to $6,603.41. No new note was executed by Ard and the note of Dickson was never marked released or cancelled. Thirty to sixty days after the transfer of shares in the business from Dickson to Ard the principal wholesale supplier for the company repossessed all of the equipment in stock. At this time it appears the liabilities of the corporation exceeded its assets and the business was closed within a year thereafter. Demand for payment of the note was made upon both Dickson and Ard in August, 1968, and the present action was filed in October, 1968.
The appellant Davenport contends as a matter of law the written memorandum of stock sale signed by Dickson and Ard did not release Dickson on his note and it was error to submit the question of novation to the jury. The appellee Dickson contends otherwise.
A novation, as recognized in the law; of contracts, is either the substitution of a new debt or obligation for an existing one which is thereby extinguished, or it is the substitution by mutual agreement of one debtor or one creditor for another where the old debt is extinguished. In either case the old debt must be extinguished. (Anno: Novation — What Constitutes, 61 A. L. R. 2d 759. For Kansas cases see Insurance Co. v. Brenner, 78 Kan. 511, 97 Pac. 438; Bridges v. Vann, 88 Kan. 98, 127 Pac. 604; Smith v. Investment Co., 112 Kan. 201, 210 Pac. 477; Badders v. Checker Cab Co., 118 Kan. 125, 234 Pac. 41; First Nat’l Bank v. Barnholdt, 128 Kan. 377, 277 Pac. 1017, and Bankers Mortgage Co. v. Breyfogle, 136 Kan. 362, 15 P. 2d 440.)
A novation may occur by substituting a new obligation or note for an existing obligation and releasing the obligation which previously existed. (First Nat’l Bank v. Barnholdt, supra.) In such case the parties remain the same but the old obligation is extinguished.
A novation may also occur where a creditor who held an obligation against his debtor agrees to and accepts in payment the obligation of a third party. (Bankers Mortgage Co. v. Breyfogle, supra.) In such case both the parties and the obligation change and the old obligation is extinguished.
An essential element of novation is that there must be a release of all claim of liability against the original debtor on the old obligation, since it is possible for a creditor, accepting a new debtor as an additional debtor, to hold the original debtor still liable. (66 C. J. S., Novation, § 20, p. 709; 58 Am. Jur. 2d, Novation, § 22, p. 536; 61 A. L. R. 2d, p. 768, Anno. §3.) A creditor’s assent to hold a new debtor liable is ineffective to constitute a novation unless there is assent to give up the original debtor. A novation is never presumed, and the burden is on the party asserting it to establish the essential requirements. (66 C. J. S., Novation, §26, p. 714; 58 Am. Jur. 2d, Novation, § 20, p. 534.) The controlling element with respect to the existence of a novation is the intention of the parties, and unless there is a clear and definite intention on the part of all concerned to extinguish the old obligation by substituting the new one therefor, a novation is not effected. (Insurance Co. v. Benner, supra; Badders v. Checker Cab Co., supra; First Nat’l Bank v. Barnholdt, supra.) The mere fact that a creditor, with knowledge of the assumption by a third party of his debtor’s obligation, consents thereto, does not amount to a novation releasing his original debtor or extinguishing the original debt. In 6 Corbin on Contracts, § 1301, p. 228, it is said:
“Frequently an assignee of contract rights undertakes to perform the assignor’s duties also. This is not operative as a novation, since the assignor remains bound by those duties so long as his creditor does not accept the assignee’s new promise in lieu of the duty of the assignor. The creditor’s actually receiving a payment or other part performance from the assignee, knowing that he has undertaken to perform, is not an assent to a novation discharging the assignor unless the assignee’s performance is tendered not merely as a satisfaction pro tanto of the assignor’s duty but also on condition that the assignor shall be discharged from any further duty. In like manner, the creditor’s written expression of assent does not operate as a discharge of his debtor by novation where he has merely been notified that an assignment of contract rights has been made and that the assignee has assumed the performance of the assignor’s duties. Such an assumption merely gives to the creditor an additional security. His expression of assent does not go beyond this, unless the notice to which he assents is clearly a proposal for a substitution of debtors instead of a mere assumption of duty by the assignee. The question is one of reasonable interpretation.”
A creditor’s acceptance of a note of a third party who becomes obligated to pay the debt owed by the debtor is not of itself evidence of an agreement to discharge the debtor from his obligation. There must be an agreement expressed or implied to do so. A novation constitutes a new contractual relation and must be based upon an obligation or contract. As such the general rules governing the relevancy and materiality of evidence in contract actions apply to actions involving contracts of novation. (66 C. J. S., Novation, § 26, p. 714; 58 Am. Jur. 2d, Novation, § 30, p. 541.)
If the intention of the parties to a transaction claimed to effect a novation is not expressed in a written instrument, or reduced to writing, the existence of such agreement and the intention of the parties must depend upon oral testimony. In such case the existence of a novation is a question of fact for the jury. (Insurance Co. v. Benner, supra; Badders v. Checker Cab Co., supra; First Nat'l Bank v. Barnholdt, supra; Credit Bureaus v. Cox Brothers, 207 Or. 253, 295 P. 2d 1107, 61 A. L. R. 2d 750.)
When the parties to a transaction which is claimed to have constituted a novation have expressed their intentions as to the corresponding obligations of the parties in a clear and unambiguous written instrument the intention of the parties depends upon a construction of the written instrument and is a question of law for the court. (66 C. J. S., Novation, § 26c, p. 716; 58 Am. Jur. 2d, Novation, § 30, p. 541.)
In Wood v. Hatcher, 199 Kan. 238, 428 P. 2d 799, it is said:
“Language in a contract is not ambiguous unless the words used to express the meaning and intention of the parties are insufficient in a sense the contract may be understood to reach two or more possible meanings.” (Syl. f 1.)
When an agreement in writing is clear and unambiguous in its terms the intention of the parties to the agreement is to be determined by the court by construing the instrument as a whole, after considering the legal effect of all language therein. Construction of the terms of a written agreement does not authorize modification beyond the meaning expressed by the language used by the parties. A court may not make a new contract or rewrite the same under the guise of construction. (Wood v. Hatcher, supra; Kittel v. Krause, 185 Kan. 681, 347 P. 2d 269; Weiner v. Wilshire Oil Co., 192 Kan. 490, 389 P. 2d 803.)
In the present case the contract alleged to effect a novation was reduced to writing in the presence of all parties affected by the transaction. It was signed by the old and new debtors and it was approved by the creditor.
Neither party to this appeal points to any ambiguity or uncertainty in the verbiage used by the parties to express their intentions. Both contend in certain portions of their briefs, at least, that the trial court was correct in excluding the oral testimony offered by appellant to prove that Dickson was advised he was not being released from liability on the note. As previously noted Dickson did not offer testimony that he was to be released on his obligation. He testified that “he never received any document from the Davenports releasing him from his obligation”. He further admitted “the original of his promissory note was never returned to him or marked ‘cancelled’, and he did not request its return.”
The trial court in its pre-trial memorandum listed one of the issues of law to be determined as: “Did the Memorandum of Stock Sale release defendant, Dickson?” However, at the trial this question was submitted to the jury as a question of fact and, we believe, erroneously so.
The general rule as to the admissibility of parol evidence applies in this case. When a contract is complete, unambiguous and free from uncertainty, parol evidence of prior or contemporaneous agree ments or understandings, tending to vary or substitute a new and different contract for the one evidenced by the writing is inadmissible. (Brown v. Beckerdite, 174 Kan. 153, 254 P. 2d 308; Williams v. Safeway Stores, Inc., 198 Kan. 331, 424 P. 2d 541.) The construction of the written instrument was, therefore, a question of law for the trial court under the rule of Wood v. Hatcher, supra.
The memorandum of stock sale provided that Ard would assume the obligation of the Dickson note. In return for which Dickson was to do several things: (1) resign as president and as director of the corporation, (2) assign his 43 shares of pledged stock in the corporation to Ard, and (3) assign his interest in the pledged account receivable to Ard. These promises, as expressed in the memorandum, were to be on a condition, “if Mrs. Davenport will let him [Ard] pay the interest to date and resume payment of the balance on a $100 — per month pr [principal] + [plus] interest schedule”. The final statement in the writing is “all per the 1-19-63 contract and pledge.” The 1-19-63 contract and pledge provided for the Dickson note.
Clearly the agreement contained nothing which could be construed to release Dickson from his obligation on the note unless the assumption of the obligation by Ard had that effect. As previously indicated in the authorities cited, the assumption of the obligation by Ard does not have that effect absent an agreement by the creditor to extinguish the old obligation.
The question is asked, what is the purpose for the signature of Mrs. Gladys Davenport? Obviously the note was in default and Dicksons rights to the stock in the corporation and the account receivable were subject to being foreclosed under the terms of the pledge. The assignment of Dickson s rights had to be conditioned on obtaining permission from Mrs. Davenport for Ard to pay the accrued interest and resume the $100.00 per month principal payments without the threat of foreclosure. Her signature on the memorandum gave that permission.
In order for the memorandum of stock sale to effect a novation it had to contain a provision releasing the obligation of Dickson on the note and it did not do so. Accordingly we hold that the trial court was correct in excluding the proffered testimony of Borsdorf, Davenport and Coffman to the effect that Dickson was advised before signing the memorandum he was not being relieved of liability on the note. However, we hold the trial court erred in submitting the question of whether the memorandum constituted a novation to the jury as an issue of fact. As we construe the written memorandum it did not release the obligation of Diclcson on the note or constitute a novation. It was approved and accepted by Mrs. Davenport as a mere collateral security and was not a substituted contract.
Now as to the judgment in favor of Ard, the matter of failure of consideration was submitted to the jury. On reviewing the record on appeal it has not been made to appear to this court that prejudicial error occurred in the trial on that issue, and the judgment in favor of Ard is affirmed. (Hatcher’s Kansas Digest [Revised Edition], Vol. 1-3 Supplement, Appeal and Error, §408.)
The judgment in favor of Dale E. Dickson is reversed, the case is remanded to the trial court with instructions to determine the amount due on the note and enter judgment in favor of the appellant and against Dale E. Dickson on appellant’s motion for directed verdict. | [
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The opinion of the court was delivered by
Foth, C.:
This is an appeal from an order dismissing a landowner’s appeal from the appraisers’ award in a condemnation proceeding. The ultimate issue is whether appellant’s notice of appeal from the appraisers’ award was timely filed; to determine this we must first decide when an appraiser’s report is “filed'’ under our eminent domain statutes so as to start a landowner’s appeal time running. Subsidiary issues involve when a judgment is “entered” for purposes of the doctrine of res judicata, and whether an erroneous admission by a landowner’s attorney that his notice of appeal was out of time is binding on his client in subsequent proceedings.
In 1970 the appellant, Jack Reed, Jr., was the owner of two tracts of land coveted by the appellee, the Urban Renewal Agency of Colby, Kansas (the “Agency”). The Agency’s advances were regularly repulsed, and in September the Agency instituted condemnation proceedings. After hearings at which appellant participated the district judge made the requisite findings of power and necessity under K. S. A. 26-504 and appointed appraisers. They were required by the order appointing them to file their report “on November 24,1970.”
Notice of the public hearing on their appraisal was given by publication and by mailing as required by K. S. A. 26-506 (a). The notice was substantially in the statutory form, as prescribed by K. S. A. 26-506 (b), and included the following information:
“Such, hearing will commence at 10:00 o’clock a. m. on thle 19th day of November, 1970, at the Court Room in Colby, Kansas, without further notice. Any party may present either oral or written testimony at such hearing.
“You are further notified that the Court has set the 24th day of November, 1970, for the filing of the awards of these appraisers with the Clerk of the District Court, and any party dissatisfied with the award may appeal therefrom as by law permitted within thirty (30) days from the date of filing.”
The appraisers met on November 19, as the notice said they would, and agreed upon their award for appellant’s land. However, they lodged their report to that effect with the clerk of the court the same day, instead of waiting until November 24, the date fixed by the judge and recited as the filing date in the notice of hearing.
Appellant, who had been fighting the condemnation all the way, now sought counsel from the law firm of Zuspann, Soward and Whalen, of Goodland. That firm prepared and, on Deoember 23, filed on appellant’s behalf a notice of appeal from the appraisers’ award.
Under K. S. A. (now 1972 Supp.) 26-508 any party dissatisfied with the award of the appraisers may secure review by filing a notice of appeal “within thirty (30) days after the filing of the appraisers’ report.” As may readily be seen, if the “filing” of the appraisers’ report took place on November 19, the date it was delivered to the clerk, appellant’s time to file his notice of appeal expired December 19, and he was out of time. If, on the other hand, the “filing” is deemed to have taken place on November 24, the date fixed by the judge for that purpose in the order appointing the appraisers and in the notice of hearing officially published and mailed to appellant, then his last day to file was December 24, and his notice of December 23 was timely.
We have not had occasion to consider this question since our present “eminent domain procedure act” was enacted in 1963 (Laws 1963, ch. 234, §,1-16.). Under former G. S. 1949, 26-102 as amended, and its predecessors, it was clear that the landowner’s appeal time ran from “the date the appraisement is filed with the clerk of the district court.” (State Highway Commission v. Griffin, 132 Kan. 153, 294 Pac. 872 Syl. ¶ 1.) Other condemnation statutes prescribed other appeal-time-starting events, such as the filing of the commissioners’ report with the city clerk under former G. S. 1949, 26-202 and 26-205.
Those sections, now repealed, were recognized in 1934 as having been “enacted to supersede and unify a number of miscellaneous statutes dealing with this subject.” (Miltimore v. City of Augusta, 140 Kan. 520, 522, 38 P. 2d 675.) At the same time it was even then recognized “That there is yet much to be done to clarify and codify the law of eminent domain. . . .” (Ibid.) The 1963 act was an effort to do just that. “By this Act the Legislature intended to replace a dozen or more different procedures used in Kansas with one uniform procedure.” (Beatty, The Eminent Domain Procedure Act, 32 J. B. A. K. 125 [1963]. See also, Spring, Comments on Practice and Procedure in Eminent Domain, 35 J. K. B. A. 7, 8 [1966].) The sixteen new sections now constituting the procedure act itself were followed by eighty-six amendments to existing statutes, all designed to conform the eminent domain power of almost all public and private entities with the new procedure.
As part of this massive effort toward clarity, simplicity and uniformity we find for the first time a statutory requirement that affected landowners be notified not only of the meeting of the appraisers but of the date fixed by the judge for the filing of the appraisers’ report. Landowners must also be advised of their right to appeal, and how and when they may exercise that right. These notice requirements were not merely set forth in the statute but incorporated in a statutorily prescribed form. We take this as indicating their importance in the statutory scheme.
K. S. A. 26-504 states that the order appointing appraisers “shall also fix the time for the filing of the appraisers’ report, . . .” It does not say the order shall fix the time “within which” the report is to be filed, nor “the last day” for such filing. Accordingly, the order here said the report should be filed “on” November 24, not “on or before” November 24. The same observations apply to the statutory form of notice and the notice actually employed. Both fix a date certain for filing, rather than a final deadline for filing.
What would the average landowner glean from reading the notice given appellant here? He would find that the appraisers would meet and determine his award on November 19, that they were required by the court to file their report on November 24, and that he had thirty days after that filing to take his appeal. He would, we think, inevitably conclude that his last day to appeal was December 24.
That would be the natural reading of the notice; the same construction might even, as here, suggest itself to experienced counsel. We think further that such must have been the legislative intent, for otherwise the required order of the court fixing the filing date and the statutory notice incorporating it would both be meaningless. The effect of both could be nullified at the whim of the appraisers, by their simply “fifing” the report whenever it suited them. We cannot believe the legislature intended to entrust them with any such power to affect the substantial rights of the parties.
We therefore hold that for the purpose of computing the parties’ appeal time the filing of the appraisers’ report under K. S. A. 1972 Supp. 26-505 is effective on the date fixed by the judge for such filing and set forth in the notice of hearing required by K. S. A. 26-506, regardless of the date such report is actually delivered to the clerk of the court.
The situation is muddied somewhat by a 1968 amendment to 26-505. That enactment (Laws 1968, ch. 138, § 1.) added a requirement that upon fifing their report the appraisers shall notify the condemner, which shall in trun mail notice to the affected landowners. It may be that this provision was intended to remedy a conceived deficiency in the statutory scheme — if early filing could in fact cut short a landowner’s appeal time, lack of notice of such filing would raise obvious due process questions. Cf. Walker v. Hutchinson City, 352 U. S. 112, 1 L. Ed. 2d 178, 77 S. Ct. 200. If such was the legislative motivation, however, the act would seem superfluous in view of what we see as a perfectly harmonious scheme of “court order and notice thereof” in the statutes as they read before the 1968 amendment, and which was unaltered by the amendment. It seems unlikely that an alteration of a statutorily and judicially established timetable in mid-proceedings was intended.
In this case concedely no post-filing notice was given appellant, as required by the 1968 act. Had he received one he would have been faced with two conflicting notices, one saying the court had fixed November 24 as the filing date and the other apparently saying the report had been “filed” on November 19. Cautious counsel having both notices before him would doubtless have resolved the conflict by filing his notice of appeal early; a layman would be in an undeserved and unnecessary quandary. We doubt the existence of a legislative intent to create such a situation. We therefore see the 26-505 post-filing notice as primarily serving to inform the landowner of the amount of the award, rather than the date from which his appeal time runs.
In this case the appeal from the appraisers’ award was dismissed by the district court on the ground that it was out of time. Appellee insists we cannot review that order because of the way it came about.
As previously stated, the firm of Zuspann, Soward and Whalen filed the notice of appeal on December 23, 1970. On January 4, 1971, that firm moved to withdraw as appellant’s counsel of record. It is apparent that the November 19 date on the appraisers’ report had come to counsel’s attention in the meantime, because on January 6, 1971, Selby Soward of that firm appeared before the trial court with Leon Roulier, counsel for the Agency, and the following colloquy occurred:
“Mb. Soward: We have a case with, Leon as to an appeal from a condemnation award that I would just as soon get settled this morning and let the statute start running if there is a malpractice suit against me in Case No. 4986. Your Honor, in what is originally the Urban Renewal Agency vs. The Church of Christ and Jack Reed, Jr.
“The Court: I have my docket sheet right here, In the Matter of Condemnation of Land for Urban Renewal Purposes vs. The Church of Christ, and others. What do we have in it today?
“Mb. Roulier: As you notice, the appraisers’ report was filed on the 19th of November by the appraisers. K. S. A. 1970 Supplement, 26-508, as it pertains to appeals from an award, states as follows: ‘If the plaintiff, or any defendant, is dissatisfied with the award of the appraisers, he may within thirty (30) days after the filing of the appraisers’ report, appeal from the award by written notice of appeal with the Clerk of the District Court.’ Mr. Soward’s firm filed the appeal on the 24th (sic) day of December, which would clearly leave it outside the statutory appeal time.
“Mr. Soward: That isn’t a quite accurate statement, Judge. We didn’t have anything but notification that the appraisers were to return their award by the 24th of November. We relied upon that. We didn’t have the information it was filed on the 19th, so we could decide employment, and we followed up our filing of an appeal with a motion to withdraw, which is now moot. I think it is fair to> state we acknowledge that the thirty day period after filing of an award is jurisdictional, and that the appeal is out of time. Mr. Reed made the statement that the Court has told him to get a lawyer to represent him.
“The Court: I told him what he needed to do was go hire a lawyer, but I didn’t know I ever convinced him.
“Mr. Soward: He never hired us. We did agree to file an appeal. I suppose we will get sued.
“The Court: The appeal is dismissed.”
On February 4, 1971, appellant’s present counsel entered the case and asked the corut to reconsider its ruling of January 6. On March 15, 1971, a schedule for the submission of briefs was fixed, and on April 8, 1971, additional arguments on the timeliness of the notice were heard. Finally, on May, 24, 1971, counsel for the Agency advised the court that he elected not to file any brief, and the matter stood submitted.
On August 30, 1971, the trial corut filed its memorandum opinion reaffirming its dismissal of the appeal, from which the appeal to this court was taken. After reciting the history of the proceeding the opinion goes on to say:
“The appellant argues that the appeal filed on December 23, 1970, was within the 30 days. He bases his argument, first on the grounds that the 30 days could only start on the last day fixed by the Court; and second on the reason by failure of appraisers or condemnor to give notice. The first argument is untenable in that the statute is specific in providing 30 days. Time is frequently of importance, and as appellant points out in his brief, this is a statutory procedure the Court must follow. The second argument wholly fails because under no possible imaginative circumstances could the appellant [have] had more notice. He participated at all times. As a participant in the aotions of the appraisers his knowledge of the ‘filing’ could not have been greater. The Court finds that at all steps Mr. Reed was fully and completely informed, and that the appeal time expired on December 19, 1970.
“The condemnor filed a Motion to Dismiss the Appeal for the reason it was filed too late. The matter was presented to the Court. Appellant agreed in open Court. The Court approved that agreement. In the interest of orderly justice litigants cannot and must not be permitted to entrap a Court nor embarrass a Court in an attempt to lull his opponent or the Court into the making of an order and then return to refute the agreement. The order dismissing the appeal, as heretofore set out, was correct, and even if not, it has now become res judicata and not subject to further review.”
Taking up these conclusions one by one, we first find that the court erred in concluding that the appeal time expired on November 19, for the reasons hereinbefore set forth. As to the failure to give post-filing notice, we would note that the court’s finding that appellant had actual notice of the date of the appraisers’ report can only be based on some undisclosed personal knowledge. The record is barren of evidence to that effect, and at the February 4 healing the court and counsel all agreed that this was a disputed issue of fact. In any event, under our interpretation of the statutes, whether or not appellant had actual notice is immaterial.
As to the conclusion that the order of January 6 was res judicata, the record reflects nothing more than the oral statement of the trial court that “the appeal is dismissed,” recorded only in the reporter’s notes. We find no journal entry of the order, nor any entry in the appearance docket made at the direction of the court. There being no jury, under K. S. A. 60-258 (b), one or the other was required to constitute the entry of judgment. Phelps Dodge Copper Products Corp. v. Alpha Construction Co., 203 Kan. 591, 455 P. 2d 555; Corbin v. Moser, 195 Kan. 252, 403 P. 2d 800. In the latter case we said (p. 255):
“It will be noted that the only instance in which the clerk enters judgment without the direction of the trial judge is on a jury verdict. Otherwise, the judge is to direct the clerk as to the judgment to be entered. The judgment cannot be entered until the judge directs, and the judgment is. not effective until entered on the appearance docket.”
We are forced to conclude that, whatever the trial court’s intention, there was no judgment entered until its memorandum was filed on August 30, 1971. Hence the order of January 6 co-uld not operate as res judicata.
Finally, we note the trial court’s quite justifiable irritation at having been, as it felt, entrapped into its previous ruling by the concession of appellant’s then counsel. We think, however, that the concession could not bind the appellant and that when asked by new counsel within thirty days to reconsider, the court was not only free but bound to do so. The factual matters, i. e., the dates, were not in dispute, and the question before the court was limited to the legal effect of the admitted facts. The text writers say of this situation:
"It has frequently been stated as a general rule that the decision of questions of law must rest upon the court, uninfluenced by stipulations of the parties, and it is generally held, accordingly, that stipulations as to what the law is are invalid and ineffective. Thus, it has been held that it is not competent for the parties or their attorneys to determine by stipulation questions as to the . . . proper construction or application of a law; . . . [or] as to the legal conclusions from admitted facts. . . .” (50 Am,. Jur., Stipulations, § 5.)
"Only statements or admissions of fact are within the authority of an attorney, and neither his client nor the court are bound by his statements or admissions as to matters of law or legal conclusions.” (7 C. J. S., Attorney and Client, §100 [&].)
Our cases take the same view:
“The court is not bound by an erroneous admission of law made by one of the parties in an action where no one is deceived and no prejudice results.” (Beams v. Werth, 200 Kan. 532, 438 P. 2d 957, Syl. ¶ 10.)
“As a general rule questions of law must be determined by the court, unlimited by agreement of the litigants, and their stipulations as to what the law is are ineffective to bind the court.” (In re Estate of Maguire, 204 Kan. 686, 466 P. 2d 358, Syl. |5.)
Thus the timeliness of the notice in question was at all times an issue of law for determination by the court alone, without regard to the concessions of counsel.
We have concluded that the trial court erred in finding that the appeal was not timely. The judgment is therefore reversed and the case remanded with directions to reinstate the appeal from the appraisers’ award.
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Rees, J.:
Plaintiff appeals from an adverse order of summary judgment entered in his action against defendant.
The material portion of plaintiff’s petition, that which sets forth his short and plain statement of the claim showing his entitlement to relief (see K.S.A. 60-208), was as follows:
“1. On March 12, 1977, in Shawnee County, Kansas, plaintiff was a business invitee at defendant’s lunch counter at 3154 E. 6th Avenue, Topeka, Kansas, ate breakfast and paid therefor; upon leaving plaintiff was loudly accosted by defendant’s agent servant and employee acting within the scope of authority, who demanded to know why plaintiff had not paid for said coffee and who would not accept plaintiff’s statement that he had indeed paid for said breakfast.
“2. Plaintiff was thereupon slandered in the presence of numerous persons in said business establishment, wrongfully detained by defendant’s further agent acting within the scope of authority, and suffered damages thereby.”
After filing his answer, defendant deposed plaintiff and then filed a motion for summary judgment stating it was for “Summary Judgment on plaintiff’s petition.” In support of his motion and as called for by Rule No. 141 (223 Kan. Ixvi), defendant filed a memorandum that included the following twelve contentions of fact that plaintiff subsequently acknowledged were not controverted:
“4. Both prior to the incident complained of by plaintiff in this lawsuit and subsequent to the incident, plaintiff was a regular customer of the Eastboro Pharmacy.
“5. At all times prior to March 12, 1977, plaintiffs relationship with Eastboro Pharmacy had been good.
“6. On the morning in question, plaintiff was served at the Eastboro Pharmacy by Mary Simmons, an employee of Eastboro Pharmacy.
“7. On the day in question, March 12, at the time plaintiff ordered his food he received his ticket and paid prior to eating the food.
“8. At the time plaintiff got up to leave on March 12, 1977, Mrs. Simmons was outside of the premises attending to other business and the employee of Eastboro Pharmacy attending the lunch counter was one that had not waited on plaintiff.
“9. Plaintiffs version of what the waitress who had not waited on him, said to plaintiff as he got up to leave is as follows:
“ ‘Just as I was getting ready to leave this other waitress say, “are you going to pay for your coffee?” I said “I’m sorry, are you talking to me?” She said, “Yes”, and I said “Well, I’ve already took care of my meal ticket”, you know like that. I kept right on stepping, she said, “Aren’t you going to pay for your coffee?”, I said, “Lady, I have already taken care of it”, and okay so in the mean time she started hollering and I kept on walking, and she said, “Hey, hey, stop him, stop him.” People was just running like I was robbing the store or something. So the guy from the pharmacy come and he run out and jumped in front of me, between me and the door, you know, and a really I wanted to hit the guy, but I said, you know, it made me mad. I said to myself, you know, I better not, so anyway, the waitress that had waited on me, about this time this waitress come back in and she said, “this, the guy you’re talking about, this is one of our best customers, you don’t need to worry about him, you know, paying for his meals and stuff, that he aint going to do nothing like that.’
“10. The whole incident complained of by plaintiff, in plaintiffs’ petition, up to the time Mrs. Simmons told everyone that the plaintiff had paid took ten (10) minutes.
“11. When Mrs. Simmons, the Eastboro Pharmacy employee, told everyone that he had paid for the coffee and that plaintiff was one of their best customers plaintiff was made to feel pretty good.
“12. No physical contact was made upon plaintiff by any employee of Eastboro Pharmacy.
“13. At no time did any employee of Eastboro Pharmacy curse or use any type of abusive language towards plaintiff.
“14. Plaintiff at all times pertinent on the day of the incident in question knew no one in the Pharmacy the day in question aside from Mrs. Simmons.
“15. Plaintiff knows of nobody whatsoever who thinks less of plaintiff because of the incident.”
The only response made by plaintiff to the summary judgment motion, other than his oral argument at the hearing, was the filing of a memorandum in opposition. When the motion came on for hearing, the only discovery record in addition to plaintiff’s deposition were replies to certain interrogatories and to an admissions request, none of which are material to determination of this matter. Plaintiff took no depositions and he filed no affidavits in opposition to the motion. See K.S.A. 60-256(c). No request was made for leave to conduct further discovery. He stood pat.
At the motion hearing, plaintiff stated that in addition to the allegations of the petition he wished to claim entitlement to recovery on the theories of outrage and invasion of privacy. With defendant’s consent, the trial judge announced he would consider the case as if the petition were amended to include these two additional claimed grounds for recovery.
The trial judge filed his written findings of fact (he incorporated the foregoing uncontroverted fact contentions) and conclusions of law and directed entry of summary judgment against plaintiff. In his findings and conclusions, the trial judge expressly discussed the theories of outrage, invasion of privacy and slander. The record on appeal clearly shows that the subject of wrongful detention, which we will refer to as false imprisonment, was not mentioned in any way in the parties’ trial court briefs nor was it mentioned at oral argument on the motion.
Plaintiff initially contends the petition alleged false imprisonment and since this theory, or claim, was not briefed, argued or decided in the trial court, the entry of summary judgment was improper. Without having raised or mentioned false imprisonment at any time or in any place in the proceedings in the trial court, except as may be gleaned from the quoted language of the petition, plaintiff argues the trial judge was obliged to acknowledge and rule on that claim. We do not agree.
Defendant’s motion for summary judgment was not for partial summary judgment; it was an unqualified request for summary judgment. See K.S.A. 60-256(o), (d). If it had been urged and argued to the trial judge that the petition alleged a claim for false imprisonment it might be so found. But plaintiff may not now rely upon the omission in the trial judge’s findings and conclusions, particularly in the absence of any post-ruling request to the trial judge for alteration or amendment, or if such is within our Code of Civil Procedure, for rehearing. Plaintiff wholly failed to raise the issue before the trial judge. Cf. Manhattan Bible College v. Stritesky, 192 Kan. 287, 290, 387 P.2d 225 (1963); Grimm v. Pallesen, 215 Kan. 660, 666, 527 P.2d 978 (1974). See also Goff v. American Savings Association, 1 Kan. App. 2d 75, Syl. ¶ 1, 561 P.2d 897 (1977).
The principles and rules applicable to consideration, decision and review of rulings on motions for summary judgment need not again be stated. Representative of case authority in this subject area is Mildfelt v. Lair, 221 Kan. 557, 561 P.2d 805 (1977).
Insofar as plaintiff’s claims for outrage and invasion of privacy are concerned, summary judgment was proper. The conduct of defendant’s employee was not so outrageous or atrocious as to exceed all possible bounds of decency as is required for outrage. Dawson v. Associates Financial Services Co., 215 Kan. 814, 820, 529 P.2d 104 (1974); Dotson v. McLaughlin, 216 Kan. 201, 209-210, 531 P.2d 1 (1975); Wiehe v. Kukal, 225 Kan. 478, 592 P.2d 860 (1979); Bradshaw v. Swagerty, 1 Kan. App. 2d 213, 216, 563 P.2d 511 (1977). To find in this lawsuit there was invasion of privacy would require intrusion upon seclusion, that is, an invasion of plaintiff’s private life. Dotson v. McLaughlin, 216 Kan. at 207-208. The mere fact of embarrassment and humiliation is insufficient to establish invasion of privacy. Plaintiff was not in seclusion while taking his meal at defendant’s establishment. The payment of the bill was very much a part of defendant’s business. Defendant’s words and conduct did not constitute an intrusion upon seclusion.
The remaining question is whether plaintiff is entitled to proceed on the theory of slander.
There are two types of slander, slander per se and slander per quod. In that slander is oral libel, what is said in Karrigan v. Valentine, 184 Kan. 783, 787, 339 P.2d 52 (1959), is pertinent:
“Words libelous per se are words which are defamatory in themselves and which intrinsically, by their very use, without innuendo and the aid of extrinsic proof, import injury and damage to the person concerning whom they were written. They are words from which, by the consent of mankind generally, damage follows as a natural consequence and from which malice is implied and damage is conclusively presumed to result. Where libel per se is claimed the question presented is whether the words on their face, without explanation or extrinsic proof, would necessarily, or as a natural and immediate consequence cause injury and whether a newspaper article is libelous per se is a question of law for the court to determine. (Jerald v. Houston, 124 Kan. 657, 261 Pac. 851; Bennett v. Seimiller, 175 Kan. 764, 267 P.2d 926; Koerner v. Lawler, 180 Kan. 318, 304 P.2d 926; 33 Am. Jur., Libel and Slander, § 5, p. 39, et seq., and 53 C.J.S., Libel and Slander, § 8, p. 41, et seq.)
“Words libelous per quod, on the other hand, are words ordinarily not defamatory but which become actionable only when special damages are shown, that is, they are words the injurious character of which appears only in consequence of extrinsic facts. Thus, words not defamatory per se, may become actionable per quod, depending upon the facts and circumstances of the particular case, and this gives rise to the rule that in order to recover for a libel per quod special damage and injury must be alleged and proved. (See authorities above cited.)”
The petition and the discovery record are insufficient to raise a justiciable issue as to whether plaintiff is entitled to recover for slander per quod. No allegation of special damages is made and the discovery record establishes no basis for a finding that plaintiff sustained special damages. A mere allegation of general damages is insufficient for slander per quod. Bennett v. Seimiller, 175 Kan. 764, 769, 267 P.2d 926 (1954). Thus, only slander per se is of possible applicability here.
It is said in Bradshaw v. Swagerty, 1 Kan. App. 2d at 215, that:
“At common law slander per se was limited to four categories: imputation of a crime; imputation of a loathsome disease; words reflecting on plaintiff’s fitness for his office, profession or trade; and the imputation of unchastity in a woman. Prosser, Law of Torts (4th ed.), pp. 754-760; 50 Am. Jur. 2d Libel and Slander, sec. 10; 53 C J.S., Libel and Slander, sec. 14. And c/., Restatement (Second), Torts, sec. 569 (Tent. Draft No. 11).
“No single Kansas case has adopted the common law categories in toto, but each of the four has been recognized: Sweaney v. United Loan & Finance Co., 205 Kan. 66, 468 P.2d 124 (imputation of a felony); Bennett v. Seimiller, supra (criminal offense, loathsome disease, prejudice to trade or business); Munsell v. Ideal Food Stores, 208 Kan. 909, 494 P.2d 1063 (unfitness for employment); Cooper v. Seaverns, 81 Kan. 267, 105 Pac. 509 (unchastity).”
Do the words spoken by defendant’s employee constitute actionable slander per se, imputation of a crime? Is this to be answered as a matter of law or is this for jury determination?
For what it is worth, the authors of Pattern Instructions for Kansas seemingly deem the question to be one of law. PIK Civ. 2d 14.52 is the only suggested pattern instruction for defamation per se and the authors comment that “this instruction should be given when the court determines as a matter of law that the communicated matter is defamatory per se.” They further state that “whether the words are in the per se classification is a question of law for the court to determine,” and “if the communication made is defamatory per se the court should instruct the jury that it is defamatory as a matter of law.” There is no promulgated pattern instruction for submission to the jury of whether the communicated words are defamatory per se.
In Bennett v. Seimiller, 175 Kan. at 767, it is said:
“It is generally held that whether a statement is libelous or slanderous per se is, in the first instance, a question of law for the court. [Citations omitted.]
“It is for the court to determine whether a certain word or words as employed reasonably admit of the meaning ascribed to them. (Doherty v. Kansas City Star [144 Kan. 206, 59 P.2d 30].) If they are reasonably susceptible of constituting slander per se the court leaves it to the jury to say how the word or words were in fact understood.”
It appears that the language in Brinkley v. Fishbein, 134 Kan. 833, 835, 8 P.2d 318 (1932), that is relied upon in the foregoing quotation in Bennett is as follows:
“[G]enerally speaking, interpretation of a writing alleged to be libelous is a matter of law for the court. The court should decide whether words are actionable per se. The court should decide whether words could not possibly be defamatory. The court should decide whether words may fairly be susceptible of two meanings, one innocent and the other defamatory.”
It would not be unreasonable to conclude the Brinkley language does not support, or at least squarely support, the Bennett statement that slander per se is a jury issue if the words used are reasonably susceptible of constituting slander per se. Similarly, in Steenson v. Wallace, 144 Kan. 730, 734, 62 P.2d 907 (1936), where the substance of the material part of the opinion is that the trial court erred when it effectively held defendant’s allegation of libel per se was supported by the factual allegations, it is said:
“The word ‘illegal’ does not necessarily imply moral turpitude or liability to criminal prosecution. It may imply simply ‘not according to law,’ or as the subheading said, ‘unauthorized.’ In this instance, plaintiff could not be punished criminally for charging mileage unless the conduct was exhibited willfully, that is, purposely and intentionally, in the sense of with unlawful intent, or in bad faith. Nothing of the kind is apparent on the face of the record, and the most the district court could say was, that the words were capable of a meaning which imported commission of a crime (Doherty v. Kansas City Star, 144 Kan. 206, 59 P.2d 30) and leave it to the jury to say how the words were in fact understood. (See Brinkley v. Fishbein, 134 Kan. 833, 836, 8 P.2d 318.)”
It may be said this too is questionable authority for the Bennett “reasonably susceptible rule.” The authoritativeness of Doherty v. Kansas City Star, 144 Kan. 206, 59 P.2d 30 (1936), also is fairly questionable.
Acknowledging recitation of the Bennett “reasonable susceptibility rule,” that is, a case is submissible to a jury on the theory of slander per se if the court finds the words not slanderous as a matter of law but reasonably susceptible of constituting slander per se, the fact is we find no Kansas case where a or the controlling issue was whether the case was submissible to a jury because of the “rule.” In truth, all Kansas defamation per se cases of more recent date than Bennett found in our research hold that whether the words spoken were slanderous per se is a question for determination as a matter of law. By way of example, it is said:
“In the case at bar the trial court should have instructed the jury that the charges made by Ideal against Munsell were defamatory as a matter of law rather than giving a general definition of libel per se.” Munsell v. Ideal Food Stores, 208 Kan. 909, 921, 494 P.2d 1063 (1972).
“Whether a newspaper article is libelous per se is a question of law for the court to determine.” Local Union No. 795 v. Kansans for the Right to Work, 189 Kan. 115, Syl. ¶ 4, 368 P.2d 308 (1962).
The words spoken to plaintiff must be interpreted without the use of innuendo for if any innuendo is necessary to show the defamatory meaning or application of the language used, the language is not actionable per se. See, e.g., Thompson v. Osawatomie Publishing Co., 159 Kan. 562, 564, 156 P.2d 506 (1945).
From the foregoing, we are satisfied that whether the quoted spoken words of the defendant’s unnamed waitress constituted slander per se was a question for decision by the trial court and now for decision by us as a matter of law. These words, in context, without innuendo or the aid of extrinsic proof, are as follows:
“[T]his other waitress say, ‘are you going to pay for your coffee?’ I said, ‘I’m sorry, are you talking to me?’ She said, ‘Yes’, and I said, ‘Well, I’ve already took care of my meal ticket’ .... she said ‘Aren’t you going to pay for your coffee?’ I said, ‘Lady, I have already taken care of it’ . . . and she said, ‘Hey, hey, stop him, stop him.’ ”
We agree with the trial court that these words did not constitute slander per se.
At the conclusion of the argument in his brief defendant’s attorney attempts to assert a motion for costs and fees pursuant to Rule No. 7.07(b) (223 Kan. xlv). We decline to consider this motion for the reason that it has not been presented in compliance with Rule No. 5.01 (223 Kan. xxxviii) and even if we were to do so we would be unable to say that the appeal is so utterly without merit as to justify an assessment of award of costs and fees.
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Lewis, J.:
This is an appeal from an order of the district court requiring the appellant to pay court costs, amounting to a $55 filing fee, assessed after he had unsuccessfully sought to have his criminal sentence vacated by a motion filed pursuant to K.S.Á. 60-1507.
Finding no error, we affirm.
In this case, the appellant had been sentenced to a term of two to five years on a plea of guilty to one count of aggravated incest. Although probation was apparently recommended by a mental health counselor and was not opposed by the State of Kansas, the court refused to grant probation and the defendant was remanded to the custody of the Secretary of Corrections to serve his sentence.
Appellant thereupon filed at least two motions to modify his sentence and one motion under K.S.A. 60-1507 seeking the same relief, all of which were denied by the trial court. The present matter is a result of a second motion pursuant to K.S.A. 60-1507 in which appellant basically raises the same issues he had unsuccessfully raised in earlier motions.
In the instant matter, the trial court summarily denied the motion without a hearing and without the appointment of counsel and, after doing so, assessed the costs of the action against the appellant. It is from this action of assessing court costs that this appeal is prosecuted.
We note that the court costs in this case amount to nothing more than a requirement that appellant pay the $55 filing fee, which had initially been waived on appellant’s poverty affidavit.
The appellant argues that the imposition of costs against an indigent incarcerated litigant in a 60-1507 action violates the laws of the State of Kansas, as well as various provisions of the Constitutions of the United States of America and the State of Kansas. Appellant appears to argue that the imposition of costs will have an effect of denying access to the courts by incarcerated indigent inmates.
We pause to note that factually in this case appellant was permitted to file his motion and the motion was heard by the court without requiring the payment of the $55 filing fee.
The question before this court then is whether the trial court may assess court costs against a pro se incarcerated litigant after that litigant’s motion has been heard and determined to have been without merit. We answer this question, as did the trial court, in the affirmative. We find no constitutional nor statutory ban against the assessment of court costs under these circumstances.
First of all we must note that, although a proceeding under K.S.A. 60-1507 is an inquiry into the validity of a sentence imposed in a criminal case, it is, nonetheless, a civil action. Thompson v. State, 195 Kan. 318, 403 P.2d 1009 (1965).
The taxation of costs in a civil action is governed by K.S.A. 60-2002, which states: “Unless otherwise provided by statute, or by order of the judge, the costs shall be allowed to the party in whose favor judgment is rendered.” We find nothing in the statutes to exclude the motions filed under K.S.A. 60-1507 from that rule. The absence of a specific legislative pronouncement to this effect is pertinent. We note that actions pursuant to K.S.A. 60-1507 are specifically excluded from the operation of K.S.A. 60-2007, which taxes attorney fees against a party who knowingly asserts a frivolous claim or defense. It would appear that if the legislative intent would have been to exclude 60-1507 plaintiffs from liability for costs, the legislature would have said so in 60-2002. See 2A Sutherland, Statutory Construction § 51.02, p. 454 (Sands 4fh ed. 1984) (“ ‘[W]here a statute, with reference to one subject contains a given provision, the omission of such provision from a similar statute concerning a related subject is significant to show that a different intention existed.’ ”). Under that reasoning we conclude that, since the legislature only excused 1507 petitioners from the assessment of attorney fees under 60-2007, it must have envisioned that they would be liable for ordinary court costs under 60-2002.
Appellant argues that Kansas Supreme Court Rule 183(a) (1988 Kan. Ct. R. Annot. 108), dealing with procedure under K.S.A. 60-1507, excuses him from any liability for the costs of the action. We have considered this argument and hold that Supreme Court Rule 183(a) does not excuse the assessment of court costs against the litigant under K.S.A. 60-1507. The rule states in pertinent partas follows: “[n]o cost deposit shall he required.” (Emphasis added.) In the instant matter, no cost deposit was required; the assessment of court costs was not made until the motion had been filed and disposed of by the court. This procedure certainly does not violate Supreme Court Rule 183(a), which requires only that no cost deposit be required.
It has been well settled in this State that, while financial obstacles, such as docket fees, may not be used to keep indigent plaintiffs from filing suit, those same fees may be taxed against the plaintiff should he lose. K.S.A. 60-2001(a) and (b) allow that when, by reason of poverty, a plaintiff is not able to pay a docket fee, the fee will not be required to commence suit. However, in Davis v. Davis, 5 Kan. App. 2d 712, 623 P.2d 1369, rev. denied 229 Kan. 669 (1981), the court held that the docket fee, waived at the commencement of the suit, may be taxed to either party at the end of the suit.
“We believe it apparent that the legislative intent of K.S.A. 60-2001(b)(l) and (2) was to aid the poverty-stricken litigant in getting into court, or in effect to make certain the courts of Kansas are available to all without regard to financial ability. The phrase ‘no fee will be required,’ as contained in the statute, is in effect to say the docket fee of $35 [now $55] will not be required in order to commence suit, if by reason of poverty the litigant is unable to pay that fee. But this is neither a waiver nor a forgiveness of the liability for the fee. We hold that costs of suit, including the docket fee provided by statute, may be taxed to the litigants, or any one or more of them, as sound judicial discretion may dictate, notwithstanding the fact the action was commenced with the filing of a poverty affidavit.” 5 Kan. App. 2d at 713-14.
The appellant’s constitutional argument is to the effect that the due process clause implies a fundamental right of access to the courts and that the imposition of court costs in a case of this nature would operate as a financial bar to the court system by litigants such as appellant. As we have pointed out above, this procedure results in no financial obstacle barring his access to the court. Under the procedure adopted here, the appellant merely runs the risk of being assessed the cost of the action should he be unsuccessful. We cannot imagine that such a procedure would in any way inhibit a potential 60-1507 plaintiff from bringing his motion before the court.
We hold that, under circumstances such as are presented in this case, the assessment of court costs should remain within the sound judicial discretion of the trial judge. We specifically hold that the trial judge did not abuse his discretion in assessing court costs against the appellant after his 60-1507 motion had been filed and determined adversely to the appellant.
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Abbott, C.J.:
This is a direct appeal by the defendant, Vernon L. Lieurance, from his conviction for driving under the influence, contrary to K.S.A. 1987 Supp. 8-1567(a)(l). Defendant’s breath test result was .234.
1. Verification by a Notary
Lieurance argues that the complaint, in this case, was not sufficient because it was not sworn to before a judge. The trial court held that State v. Fraker, 12 Kan. App. 2d 259, 739 P.2d 940 (1987), modified 242 Kan. 466, 748 P.2d 868 (1988), does not require the complaint to be sworn to before a judge and that a notary is sufficient.
The language of the statutes does not require the complaint to be sworn to before a judge. K.S.A. 1987 Supp. 8-2104(d) requires that the accused be taken before a judge without unnecessary delay. K.S.A. 22-2301(1) requires that the complaint be filed with a magistrate to commence prosecution. The only requirement as to swearing to the complaint is in K.S.A. 1987 Supp. 22-2202(8), which merely requires the complaint to be “under oath.” It does not say the oath needs to be taken before a judge. These statutes allow the complainant to swear to the complaint and then file it with the court.
Lieurance relies on the Supreme Court’s statement in State v. Fraker that the citation/complaint failed because “it is not sworn to by the complainant before the judge.” 242 Kan. at 468. He argues this requires that the complaint must actually be sworn to in the presence of a judge.
Fraker should not be interpreted as requiring the complaint to actually be verified before a judge. K.S.A. 54-101 allows oaths to be administered by “[n]otaries public, judges of courts . . ., mayors . . ., clerks of courts of record, county clerks, and registers of deeds.” In Fraker, the court also said a “DUI must be commenced with the filing of a verified complaint.” 242 Kan. at 467. There simply was not a sworn complaint in Fraker. “[S]worn to . . . before the judge” (242 Kan. at 468) merely means that the complaint needs to be sworn to and then filed with the court.
Lieurance also argues that the notary who took the deputy’s oath was also a deputy and that this should invalidate the complaint. The record does not show the notary to be a deputy. It would not matter, however, whether the notary was a deputy as the statutes do not preclude a notary who is a deputy from administering an oath.
Shortly after Fraker was decided, the legislature again amended 8-2104 and 8-2106. See K.S.A. 1988 Supp. 8-2104(a); 8-2106(a) and (e). K.S.A. 1988 Supp. 8-2104 still requires a person charged with a DUI to be taken before a judge. K.S.A. 1988 Supp. 8-2106 now allows any offense under the Uniform Act Regulating Traffic to be charged by a citation, presumably followed by the filing of an information under K.S.A. 22-2303. Subsection (e) of K.S.A. 1988 Supp. 8-2106 precludes release of a DUI defendant on a written promise to appear.
These new sections took effect on July 1, 1988. Lieurance was arrested on April 15, 1988. The complaints were filed on April 19, 1988. Lieurance filed his motion to dismiss on August 12, 1988, after the new statutes took effect. Although procedural and remedial statutes may be given retrospective application (see State v. Nunn, 244 Kan. 207, 216, 768 P.2d 268 [1989]), retrospective application would not be appropriate under the circumstances before us. Generally, even procedural statutes are not retrospectively applied to proceedings that have already taken place. In fact, the State does not argue for retrospective application.
Another related argument is that nothing in the record shows an appearance before a court until April 29, 1988, when Lieurance was arraigned and pled not guilty. The complaints were hied with the court on April 19, 1988. The language of K.S.A. 1987 Supp. 8-2104(d) is unambiguous; the officer “shall” take the person into custody and then before a judge without unnecessary delay.
Lieurance certainly was taken into custody, but he did not stay in jail until arraignment on April 29. The docket shows that he was released on $500 bond, and at oral argument it was conceded that he was released on bail shortly after the breath test.
The requirement that a DUI defendant be taken before a judge is an obvious attempt to comply with constitutional requirements. Gerstein v. Pugh, 420 U.S. 103, 125, 43 L. Ed. 2d 54, 95 S. Ct. 854 (1975), holds that there must be a probable cause determination after a warrantless arrest when the defendant is to be held in custody for more than a short period. Here, Lieurance does not claim he was detained for an extended period. Taking Lieurance before a judge would have been pointless. If there was noncompliance with the statute, it was harmless. So long as he was promptly released, he suffered no prejudice from not being taken before a judge.
The procedure used to arrest Lieurance was sufficient. It met both statutory and constitutional requirements.
2. Probable Cause Determination
Lieurance argues that the arrest and charging procedure in this case deprived him of his Fourth and Fourteenth Amendment rights under the United States Constitution. He cites several United States Supreme Court cases concerning warrantless arrests in houses — all of which are irrelevant. This is an arrest with probable cause in a public place, which does not require a prior judicial determination of probable cause. See United States v. Watson, 423 U.S. 411, 46 L. Ed. 2d 598, 96 S. Ct. 820 (1976). Kansas statutes also grant authority for such an arrest. See K.S.A. 22-2401. See also State v. Miesbauer, 3 Kan. App. 2d 53, 588 P.2d 953 (1979) (holding that an officer may arrest a DUI suspect with probable cause pursuant to 22-2401).
Lieurance also argues that in any event a probable cause determination is necessary after the arrest. He argues that Gerstein v. Pugh, 420 U.S. 103, 43 L. Ed. 2d 54, 95 S. Ct. 854 (1975), stands for the proposition that a pretrial probable cause hearing must be held whenever the defendant is subject to restraint pending trial. As stated above, Lieurance was released and thus there was no constitutional violation. Even if he was held in custody and there was a violation of his right to a probable cause determination, it is irrelevant. Gerstein holds that “illegal arrest or detention does not void a subsequent conviction.” 420 U.S. at 119. See United States v. Bohrer, 807 F.2d 159 (10th Cir. 1986).
Lieurance’s due process challenge must also fail. He has not shown he was prejudiced in any way at trial.
3. Venue
Lieurance argues that the State did not establish venue because no one actually said that the streets Kellogg, Armour, and Post Oak are in Sedgwick County, Kansas. It does not appear that Lieurance raised this at trial. Failure to make timely objection waives venue. See Barbara, Kansas Criminal Law Handbook § 2.7 (1987). In any event, there is ample proof of venue.
“It is not necessary to prove the jurisdictional facts of venue by specific questions and answers to establish the county in which the offense occurred. [Citation omitted.] Under K.S.A. 60-409 the trial court can take judicial notice . . . [of venue]. [Citation omitted.] Venue is a fact to be determined by the jury and may be proven by circumstantial evidence.” State v. Deutscher, 225 Kan. 265, 272, 589 P.2d 620 (1979).
A finding of venue by a Sedgwick County court when a Sedgwick County deputy testifies about an occurrence while he was on patrol, along with the mention of Kellogg, Armour, and Post Oak Streets, is based on substantial competent evidence.
4. Intoxilyzer Results
Lieurance correctly observes that, to introduce the results of a breath test, the prosecution must lay a foundation showing that the testing machine was operated according to the manufacturer’s operational manual and any regulations set forth by the Department of Health and Environment. See City of Shawnee v. Gruss, 2 Kan. App. 2d 131, 576 P.2d 239, rev. denied 225 Kan. 843 (1978) (citing K.A.R. 28-32-1). He suggests several points where he thinks the trial court erred in finding adequate foundation for admission of the test results.
Whether an adequate evidentiary foundation was laid is a question of fact for the trial court and largely rests in its discretion. State v. Woolridge, 2 Kan. App. 2d 449, 450, 581 P.2d 403, rev. denied 225 Kan. 846 (1978). So long as there is substantial competent evidence to support the finding, it will not be disturbed on appeal.
First, Lieurance argues that, according to Department of Health and Environment regulations, the defendant must be observed for twenty minutes prior to administering the test. He argues that the testimony was conflicting about the amount of time the deputy observed him. The deputy testified several times that he observed Lieurance in excess of twenty minutes.
In Gruss, a similar claim was made by the appellant on similar evidence. The court said:
“[W]hether the appellant actually was observed for twenty minutes is a question of fact to be resolved by the trial court. The officer’s testimony that he did watch the defendant for twenty minutes constitutes substantial, competent evidence supporting that finding of fact and it, therefore, will not be disturbed on review.” 2 Kan. App. 2d at 133.
Next, Lieurance argues that part of the required foundation is that both the testing officer and the machine itself must be certified by the Department of Health and Environment. Gruss and K.A.R. 28-32-1 do so require. Lieurance argues that the documents introduced at trial to show this certification were improperly introduced.
There was some confusion at trial over what was needed to admit the certificate on the Intoxilyzer. The State tried to introduce a copy of the certification of the machine. The judge ruled that the original had to be produced. K.S.A. 1988 Supp. 60-467(a)(5) allows copies of official records to be used in place of the original. K.S.A. 60-465 requires some form of authentication that it is a correct copy.
At trial, the State eventually obtained the original certificate for the Intoxilyzer. The sheriffs deputy testified that he was able to recognize the document as the original. The deputy clearly recognized the document for what it was. The only necessary foundation was to establish that it was what it claimed to be. The deputy’s testimony was substantial competent evidence upon which the trial court could rely.
Lieurance also challenges admission of the certificate showing that the deputy was certified to use the Intoxilyzer. The original certificate was produced by the deputy who testified he knew it was the original. Again, this is the only foundation required, and it was well within his range of personal knowledge. It was properly admitted into evidence.
Next, Lieurance argues the deputy testified that the inspections of the Intoxilyzer were not done as required. Actually, the deputy testified he was not aware when the last State inspection was done and the last time he personally saw an inspection was “a couple of years ago.” The Intoxilyzer had been certified by the State; the deputy was merely saying when he last saw it inspected.
Lieurance argues that the standard test solution used to ensure accuracy was not reliable because the deputy had no way of knowing once it was added to the machine that it was not used more than the maximum of fourteen times. In fact, the deputy testified that, every time the machine was used, the test was logged on a sheet to ensure that it was only used the proper number of times. Again, this procedure was within the deputy’s personal knowledge and was substantial competent evidence that the trial court could rely on when it admitted the test results. Calling all officers with access to the machine would be unreasonable and probably impossible. Likewise, the certification of the test solution itself and the procedure for adding it to the machine were subjects of the deputy’s testimony, within his range of knowledge, and presented substantial competent evidence for the trial court to rely on.
Finally, Lieurance argues that the Intoxilyzer results, “.234,” were not explained to mean grams of alcohol per 210 liters of breath. Lieurance did not raise this at trial, so it cannot be raised on appeal. “Issues not presented to the trial court will not be considered for the first time on appeal.” State v. Anderson, 12 Kan. App. 2d 342, Syl. ¶ 1, 744 P.2d 143 (1987).
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Bullock, J.:
In this action, The Union Pacific Railroad Company (Union Pacific) appeals a summary judgment damage award of $10,912 in favor of Tom Anderson for property damage and attorney fees arising out of a March 27, 1988, fire.
In the court below, the parties stipulated to the following facts. On March 27, 1988, a railroad engine and train owned by Union Pacific negligently caused a fire which incinerated property adjacent to the railroad tracks. On October 24, 1984, Anderson had leased a 330- by 150-foot parcel of commercial property adjacent to the railroad tracks from Union Pacific for an annual rental of $644. He stored several automobiles- on the property. The fire destroyed twenty vehicles with a total value of $7,600.
Section 13 of the lease included the following provisions;
“It is understood by the parties hereto that the Premises are in dangerous proximity to the tracks of the Lessor, and that by reason thereof there will be constant danger of injury and damage by fire, and the Lessee accepts this lease subject to such danger.
“It is therefore agreed, as one of the material considerations for this Lease and without which the same would not be granted by the Lessor, that the Lessee assume all risk of loss or destruction of or damage to buildings or contents on the Premises, and of or to other property thereon . . . where such loss, damage, destruction, injury, or death of persons is occasioned by fire caused by, or resulting from, the operation of the railroad of the Lessor, whether such fire be the result of defective engines, or of negligence on the part of the Lessor or of negligence or misconduct on the part of any officer, servant, or employee of the Lessor, or otherwise, and the Lessee hereby agrees to indemnify and hold harmless and defend the Lessor . . . against and from all liability . . . arising out of or by reason of any such loss, damage, destruction, injury, or death of persons . . . .”
Although Anderson questioned some of the terms of the lease in the pre-lease negotiations, Union Pacific would not alter any of them.
After the fire, Anderson filed suit to recover for damage to his personal property. Cross-motions for summary judgment were filed. Union Pacific moved for summary judgment on the basis of section 13 of the lease. Anderson defended that the provision was unenforceable and moved for summary judgment on the stipulated facts. The court granted Anderson’s motion and denied Union Pacific’s motion, holding that the lease provision violated K.S.A. 66-234 and was contrary to public policy and, thus, was unenforceable.
Union Pacific timely appeals the entry of summary judgment.
The trial court determined that section 13 of the lease violated K.S.A. 66-234 and Kansas public policy. Our scope of review is de novo, inasmuch as the sole issue is the legal effect of the lease contract. Adams v. John Deere Co., 13 Kan. App. 2d 489, 492, 774 P.2d 355 (1989).
Kansas follows the general principle that “competent parties may make contracts on their own terms, provided they are neither illegal nor contrary to public policy.” 13 Kan. App. 2d at 492. Anderson, of course, contends that section 13 of the lease is both illegal and contrary to public policy.
Anderson first contends the waiver of liability provision of section 13 of the lease violates the clear language of K.S.A. 66-234.
K.S.A. 66-234 was enacted in 1870 and provides: “Railroads in this state shall be liable for all damages done to person or property, when done in consequence of any neglect on the part of the railroad companies.” Anderson argues this language, especially the legislature’s use of the word “shall,” indicates that the legislature intended railroads to be liable for their negligence without exception. However, as early as 1873, the Kansas Supreme Court indicated K.S.A. 66-234 was not a clear, unambiguous statute but instead raised “many interesting questions” concerning contributory negligence and assumption of risk. St. Joseph & D. C. R. Co. v. Grover, 11 Kan. *302, *306 (1873).
In 1915 the Kansas Supreme Court was called upon to determine the validity of a waiver of liability provision under the statute. Grain Co. v. Railway Co., 94 Kan. 590, 146 Pac. 1134 (1915). In Grain Co., the court held that a hold harmless provision in a railroad lease was not “void on the ground of public policy.” 94 Kan. at 593. See generally Annot., 14 A.L.R.3d 446. Anderson attempts to distinguish Grain Co. from the instant case by arguing that in Grain Co. the railroad and grain company had a business relationship, that the grain company lease was on the railroad right of way, and that Grain Co. did not deal with damage caused by fire. In our view, none of these distinctions mandate a different conclusion.
The lease in Grain Co. allowed the Griffiths Grain Company to store grain in elevators built on the railroad right of way. The lease contained a waiver of liability provision for all damages caused by the railroad’s negligence. There was no express language in the lease that required the Griffiths Grain Company to ship any grain on the railroad. Ultimately, a train derailment damaged the silos and the grain company brought suit. The Kansas Supreme Court expressly rejected the argument that the waiver of liability was void as a matter of public policy. 94 Kan. at 593. Thus, the legal arguments advanced in Grain Co. are indistinguishable from the arguments in the instant case, and the only factual distinction is in the manifestation of the railroad’s negligence. Neither K.S.A. 66-234 nor the court’s opinion in Grain Co. makes this distinction relevant.
An indemnification clause in a railroad contract was also upheld in Riddle Quarries, Inc. v. Thompson, 177 Kan. 307, 279 P.2d 266 (1955). In Riddle Quarries, the plaintiff had stored property along a railroad right-of-way pursuant to a license which contained both a hold harmless clause and an express assumption of risk clause. The court upheld the clauses, holding that, when the public is not involved, the railroad may make such contracts. 177 Kan. at 312. Riddle Quarries thus distinguished between the railroad’s duty to the public as a common carrier and its freedom of contract in non-public operations. In the instant case, the public was not involved; instead, the relationship was that of landlord/tenant in a commercial lease.
In private contracts, exculpatory clauses are upheld unless the agreement is contrary to public policy or is illegal. Corral v. Rollins Protective Services Co., 240 Kan. 678, 681, 732 P.2d 1260 (1987). Thus, in Corral, an exculpatory clause in a fire alarm installation/maintenance agreement was enforced in the absence of any indication the plaintiff could not understand the terms of the contract or was at a business disadvantage. 240 Kan. at 683-84. Similarly, in Talley v. Skelly Oil Co., 199 Kan. 767, 433 P.2d 425 (1967), an exculpatory clause in a commercial lease was upheld where the clause neither violated a Kansas statute nor was contrary to public policy.
Because section 13 of the lease does not violate K.S.A. 66-234, as interpreted by our Supreme Court, Anderson’s reliance upon Hunter v. American Rentals, 189 Kan. 615, 371 P.2d 131 (1962), is misplaced. Hunter dealt with a trailer and trailer hitch rental contract which attempted to disclaim liability for the rental company’s negligence. The provision was held void as contrary to public policy because the trailer did not have an adequate safety hitch, a violation of a Kansas statute. 189 Kan. at 617. Unlike Hunter, the lease in the case at bar did not violate a Kansas statute. Therefore, section 13 of the lease should not be held contrary to public policy on the basis of a statutory violation.
Anderson next contends that public policy disfavors waivers of liability. It is true that such waivers are strictly construed against the party who drafted the waiver of liability. Belger Cartage Serv., Inc. v. Holland Constr. Co., 224 Kan. 320, 329, 582 P.2d 1111 (1978). However, even a strict construction of section 13 of the lease does not assist Anderson. The type of damage caused by the fire is precisely the risk Anderson expressly assumed in section 13. Therefore, section 13 cannot be held contrary to public policy on this basis.
Anderson also argues that section 13 of the lease is “overbroad” and argues that it could conceivably cover the “entire state of Kansas.” Anderson cites no cases supporting the proposition that such overbreadth is sufficient grounds for declaring section 13 void, and, in all events, that situation is not before us under the facts of this case.
Furthermore, in Thirlwell v. Railway Co., 108 Kan. 700, 196 Pac. 1068 (1921), the court dealt with a lease provision calling for assumption of risk of damages on property “ ‘near said track.’ ” 108 Kan. at 701. The plaintiff there argued that “ ‘near said track’ ” could extend a hundred miles. The Kansas Supreme Court rejected the argument and upheld the validity of the clause. 108 Kan. at 702. The language in section 13 is more specific than the language in Thirlwell. By its terms, it applies only to property in “proximity to the Premises when connected with or incidental to the occupation” of the leased premises.
Finally, Anderson contends the contract was an adhesion contract and, as such, should be construed against Union Pacific. An adhesion contract is a “[standardized contract form offered to consumers of goods and services on essentially ‘take it or leave it’ basis without affording consumer realistic opportunity to bargain and under such conditions that consumer cannot obtain desired product or services except by acquiescing in form contract.” Black’s Law Dictionary 38 (5th ed. 1979). We also note the rule that contracts limiting liability will not be enforced unless the limitation is “ ‘fairly and honestly negotiated and understanding^ entered into.’ ” Belger, 224 Kan. at 330 (quoting 17 Am. Jur. 2d, Contracts § 188).
In Belger, the court determined that a waiver of liability provision which appeared in small type on the reverse of a preprinted crane rental form was unenforceable. Anderson argues that the fact that the lease was on a standardized form with “boilerplate type” language prepared by the railroad should make section 13 unenforceable. However, the totality of the circumstances surrounding an exculpatory clause in a contract may be considered to determine whether it is enforceable. Belger, 224 Kan. at 331. In the instant case, the record does not indicate that Anderson did not understand the provisions in the lease. Indeed, Anderson admits that he questioned some of the provisions.
Moreover, characterizing the language as boilerplate is inaccurate. The contract contains eight single-sided, single-spaced typed pages with topic headings in the left margin. The topic heading for section 13, “Fire Damage Release,” was clear and concise. Additionally, the record does not indicate that Anderson was under any time pressures or was unable to find other comparable commercial property. Instead, the record indicates that Anderson rented 49,500 square feet of commercial property for $644 a year. Thus, the totality of the circumstances indicate that Anderson found the rental price attractive and agreed to lease the property even though he questioned some of the provisions of the lease. In our judgment, the contract was fairly and honestly negotiated and understandingly entered into and was, therefore, not an adhesion contract.
Union Pacific advances a single public policy argument which favors enforcement of section 13 of the lease. Union Pacific notes that railroads have relied on the holding in Grain Co., 94 Kan. 590, for over 65 years and have entered into contracts accordingly. Affirming the trial court would result in overruling Grain Co. and its progeny and would undermine all of the contracts entered into in reliance upon Grain Co., a result not lightly to be entered into. We concur.
Reversed. Judgment entered for Union Pacific for costs on appeal. | [
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Brazil, J.:
The Board of Education of Unified School District No. 279 (Board) appeals from a district court decision finding that the Jewell-Randall Education Association (Association) has standing to file a prohibited practice complaint after negotiations have ended and unilateral contracts have been issued, that the Board may include terms in a unilateral contract that were neither noticed nor negotiated, that the Secretary of the Kansas Department of Human Resources (Secretary) had authority to order the Board to pay $7,700 to the Association as a remedy for violating K.S.A. 72-5429, and that the relief granting authority given to the Secretary under K.S.A. 1989 Supp. 72-5430a(b) does not violate the Kansas Constitution. The Association cross-appeals from the district court decision finding that the Board’s failure to make the unilateral contract salary increase retroactive did not constitute a prohibited practice pursuant to K.S.A. 72-5430. We affirm in part and reverse in part.
In January 1985, both the Association and the Board submitted notice of the items they proposed to negotiate for inclusion in the 1985-86 collective bargaining agreement in accordance with K.S.A. 1989 Supp. 72-5423(a). In the course of negotiations, the parties reached agreement on all issues except base salary and fringe benefits. In May 1985, both parties declared they were at impasse, and the impasse procedures of mediation and factfinding were initiated pursuant to K.S.A. 72-5427 and 72-5428. In Oc tober 1985, the Board’s representatives rejected the factfinder’s recommendations and made a counterproposal to the Association. The counterproposal offered wage increases of 10.03% and fringe benefit increases, both effective with the December payroll, not retroactive to the beginning of the school year. In April 1985, prior to impasse, the Board had made the same offer except that it was to be effective with the beginning of the school year. The October offer was $8,536 less than the previous offer. The Association’s negotiating team rejected the counterproposal. Since no agreement was reached, the Board issued each teacher in the district a unilateral contract which provided a wage increase of 10.03% and a fringe benefit increase, both effective with the December payroll. Eighteen of the twenty teachers signed the unilateral contracts.
During the fall of 1985, several articles regarding the Board’s proposal appeared in the Jewell County newspaper. The first discussed the factfinder’s report, the Board’s October proposal, and the Association’s rejection of the proposal. The second article discussed the unilateral contract offer, stating:
“The Board’s new compensation package will become effective December 1, 1985. . . .
“To date the Association’s refusal to accept the Board’s 10.03 percent offer has cost the school district over $7,700, not including the cost of the man hours required by the administration and board members to deal with the negotiations deadlock. The School Board does not feel that this cost should be borne by the taxpayers of USD 279. For this reason the Board has deducted the $8,536 to cover the current and future costs of completing this year’s negotiations. The Board does not feel that it is fair for the Association to now expect the Board to offer the same amount of money proposed in good faith by the Board over half a year ago.”
The Association filed a complaint against the district, alleging that the unilateral contract altered certain terms which were not noticed for negotiation and that the Board’s failure to negotiate the terms which were not noticed was a prohibited practice as defined by K.S.A. 72-5430(b)(l), (3), (6), and (7). The Association additionally alleged that the Board’s refusal to make the compensation package retroactive to the beginning of the 1985-86 school year constituted bad faith in professional negotiations in violation of K.S.A. 72-5430(b)(l), (5), (6), and (7). The Association requested the Secretary to grant the following relief:
1. Order the Board to reissue the unilateral contract omitting the changes in the items not noticed for negotiation and to give retroactive effect to the unilateral contract to the beginning of the 1985-86 school year.
2. Order the Board to issue a statement to the teachers acknowledging it committed the prohibited practices alleged and assuring the teachers that it will refrain from interfering with the rights of the Association in the future.
3. Order the Board to post a notice in all attendance centers and the administrative offices acknowledging it committed the prohibited practices alleged in the complaint.
4. Assess a fine of $500 against the Board payable to the Association.
A hearing was held before the Secretary during which the parties stipulated to the facts. The Secretary concluded:
1. The Association had authority or standing to file a timely complaint after the Board tendered a unilateral contract offer to the teachers.
2. The Board’s act of changing unnoticed subjects in the unilateral contract offer was remedied by subsequent negotiations.
3. The deduction of $8,536 from the Board’s original salary offer and the salary offered in the unilateral contract, and the suggestion that $7,700 of the deduction was used to pay for the Board’s factfinding services constituted a violation of K.S.A. 72-5430(b)(l) and (5).
The Secretary ordered the Board to pay $7,700 to the Association for reimbursement of teachers within the district who were employed during the 1985-86 school year. The Association was instructed to place the money with a financial institution pending approval from the Secretary of a proposed payment to the individual teachers.
The Board appealed the Secretary’s order to the district court. The district court ruled the controversy was moot because contracts were entered for the two years following the year in question. In addition, eighteen teachers signed unilateral contracts for the year in question, and the two remaining teachers chose not to pursue legal action within the six-month statutory period. In unpublished opinion No. 62,414, filed January 20, 1989, this court reversed and remanded the case for a determination of whether the Board complied with K.S.A. 72-5429, which provides that all costs for mediation and factfinding shall be borne equally by the Board and the Association.
On remand, the district court made the following conclusions of law.
“1. The Association did have standing to file a prohibited practice complaint with the Secretary after negotiations with the Board ended and unilateral contracts were issued.
“2. When issuing unilateral contracts under K.S.A. 72-5428(f), the Board is free to include terms which were neither noticed for negotiation nor negotiated.
“3. It is not a prohibited practice for the Board to offer less unilaterally than was bargained for collectively.
“4. The Board did not commit a prohibited practice when it did not make the unilateral salary increase retroactive.
“5. The Secretary did have the authority to order the Board to pay $7,700 to the Association as a remedy for violating K.S.A. 72-5429.
“6. The relief granting authority given the Secretary under K.S.A. 72-5430a(b) is not violative of the Kansas Constitution.”
1. The cross-appeal.
The Association cross-appeals, arguing that the Board committed a prohibited practice pursuant to K.S.A. 72-5430(b)(l) and (5) by not making the compensation package in the 1985-86 unilateral contract retroactive. The statute provides:
“(b) It shall be a prohibited practice for a board of education or its designated representative willfully to:
(1) Interfere with, restrain or coerce professional employees in the exercise of rights granted in K.S.A. 72-5414;
(5) refuse to negotiate in good faith with representatives of recognized professional employees’ organizations as required in K.S.A. 72-5423 and amendments thereto.”
K.S.A. 72-5414 provides professional employees with the right to form employees’ organizations and to participate in professional negotiations with a board of education for the purpose of establishing, maintaining, protecting, or improving the terms of professional service. Here, the unilateral contract was issued by the Board to the teachers after the negotiation process was completed as required by K.S.A. 72-5428a. Because the issuance of the contract occurred after the negotiations process was complete, the issuance of the contract did not restrain or coerce the Association during the time the Association was negotiating with the Board.
The Association argues the Board violated K.S.A. 72-5430(b)(5) by failing to notice for negotiation or negotiate the issue of the retroactivity of the wage increase. K.S.A. 1989 Supp. 72-5423(a) provides that both the Board and Association must provide notices to negotiate on new terms or to amend an existing contract on or before February 1. In Riley County Education Ass’n v. U.S.D. No. 378, 225 Kan. 385, 592 P.2d 87 (1979), the school district, after unsuccessful negotiations, issued unilateral contracts to the teachers containing a new item which had not been noticed for negotiation in accordance with 72-5423(a). The teachers argued that to allow U.S.D. No. 378 to include unnegotiated new items in unilateral contract offers would reduce the collective negotiations law to a nullity. In holding that a board can place a new provision in a unilateral contract, the court said:
“We have carefully reviewed the Collective Negotiations Law and find nothing therein that would preclude the Board from placing a new provision in the unilateral contract. As previously stated, professional negotiations are defined in K.S.A. 1976 Supp. 72-5413(g) as ‘meeting, conferring, consulting and discussing in a good faith effort by both parties to reach agreement with respect to the terms and conditions of professional service.’ We hold that after good faith professional negotiations, pursuant to the Collective Negotiations Law applicable in June, 1977 (K.S.A. 1976 Supp. 72-5413 et seq.), terminated unsuccessfully, the Board could issue unilateral contracts for the next school year containing an item not noticed for negotiation pursuant to K.S.A. 72-5423.” 225 Kan. at 391-92.
Here, good faith negotiations terminated unsuccessfully, and the Board issued unilateral contracts to the teachers. The fact that the unilateral contracts contained a nonretroactive pay provision, which was not noticed for negotiations, is not fatal. The Board may include provisions which were not noticed for negotiations in the unilateral contracts.
However, the real issue in this case is whether the Board, in a unilateral contract, can reduce its offer by the amount of costs it has incurred in mediation and factfinding. The reasons given by the Board for the action were that the costs should not be borne by the taxpayers and that it would be unfair for the teachers to get the same amount of increase offered by the Board in good faith prior to the impasse.
As noted by the hearing officer for the Secretary of Human Resources, these reasons leave
“a strong impression that the Board was motivated in their action by a desire to ‘punish’ or ‘teach’ the teachers a lesson so that in future negotiations the teachers would not elect to utilize the lengthy or costly impasse procedures. At [the] very least the action placed the teachers on notice that they could at best expect to gain nothing and in fact lose if they chose to utilize impasse procedures.”
Reducing the Board’s offer by the amount of costs it incurred constituted a prohibited practice under K.S.A. 72-5430(b)(l) and (5) not because of its impact upon 1985-86 negotiations but rather because of its potential impact upon negotiations in subsequent years.
2. K.S.A. 72-5429.
The district court found that, by attempting to recoup its costs in the unilateral contract, the Board violated K.S.A. 72-5429 and that the statutory violation was a prohibited practice. The statute provides:
“All of the costs incurred for mediation under K.S.A. 72-5427 and for fact-finding under K.S.A. 72-5428, shall be borne equally by the board of education and the professional employees’ organization involved therein. The payment of such costs shall be at such time and in such manner as is determined by the secretary.”
The district court upheld the Secretary’s award of $7,700 to the Association based on the violation of this statute.
Interpretation of a statute is a question of law subject to unlimited review. Director of Taxation v. Kansas Krude Oil Reclaiming Co., 236 Kan. 450, 455, 691 P.2d 1303 (1984); Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988). “The fundamental rule of statutory construction is that the purpose and intent of the legislature governs when the intent can be ascertained from the statute. In construing statutes, the legislative intention is to be determined from a general consideration of the entire act.” State v. Adee, 241 Kan. 825, 829, 740 P.2d 611 (1987). In determining legislative intent, this court is not bound to a review of the statutory language alone but may consider the causes which impelled the statute’s adoption, the objective sought to be attained, the statute’s history, and the effect of the statute when construed in the various ways suggested. State v. Phifer, 241 Kan. 233, 238, 737 P.2d 1 (1987).
The costs referred to in K.S.A. 72-5429 are limited to the costs that the mediator and factfinder, not the parties, incurred during impasse procedures. Any costs incurred by the Board or Association in preparing for negotiations and/or impasse proceedings must be borne by the party receiving the benefit. The Board’s action was not a violation of K.S.A. 72-5429. The trial court’s conclusion of law that the Secretary had the authority to award $7,700 to the Association is reversed.
3. The prohibited practice complaint.
Prohibited practice complaints are submitted to the Secretary who holds a hearing and either dismisses the complaint or determines a prohibited practice has been committed. The Secretary may grant or deny the relief sought. Review of the Secretary’s decision is taken in accordance with the Act for Judicial Review and Civil Enforcement of Agency Actions, which provides for initial review of the Secretary’s action in district court. K.S.A. 1989 Supp. 72-5430a(a) and (b); K.S.A. 77-609. On appeal this court must adhere to the same standards as the district court.
“ ‘A district court may not, on appeal, substitute its judgment for that of an administrative tribunal, but is restricted to considering whether, as a matter of law, (1) the tribunal acted fraudulently, arbitrarily or capriciously, (2) the administrative order is substantially supported by evidence, and (3) the tribunal’s action was within the scope of its authority.
“ ‘In reviewing a district court’s judgment, as above, this court will, in the first instance, for the purpose of determining whether the district court observed the requirements and restrictions placed upon it, make the same review of the administrative tribunal’s action as does the district court.’ ” Board of Johnson County Comm’rs v. J.A. Peterson Co., 239 Kan. 112, 114, 716 P.2d 188 (1986) (quoting Kansas State Board of Healing Arts v. Foote, 200 Kan. 447, Syl. ¶¶ 1, 2, 436 P.2d 828 [1968]).
.The Board argues the Association had no authority to file a prohibited practice complaint based on a violation of the duty to negotiate in good faith after the Board and the Association completed mediation, factfinding, and mandatory negotiations, and after the Board issued unilateral contract offers to the teachers. More specifically, the Board argues that K.S.A. 72-5430(a) infers that prohibited practices must arise during negotiations, that the Board’s issuance of unilateral contracts occurred after negotiations, and that therefore the Board could not be charged with refusing to negotiate in good faith in violation of K.S.A. 72-5430(b)(5). The Board also argues the Association ceased to be a real party in interest after negotiations ended and therefore had no right to file a prohibited practice complaint. The Secretary and district court both concluded that the Association had standing to file the prohibited practice complaint after negotiations with the Board ended and unilateral contracts were issued.
K.S.A. 72-5430(a) states that the commission of any prohibited practice constitutes evidence of bad faith in professional negotiations. It is a prohibited practice for the Board to interfere with, restrain, or coerce professional employees’ right to join a professional employees’ organization and to participate in professional negotiations. K.S.A. 72-5430(b)(l). It is also a prohibited practice for the Board to refuse to negotiate in good faith with the employees’ organization or to refuse to participate in good faith mediation, factfinding, or arbitration. K.S.A. 72-5430(b)(5), and (7). Any controversy concerning prohibited practices may be submitted to the Secretary who will commence proceedings against the party alleged to have committed the prohibited practice within six months of the date of the alleged practice by serving the party with written notice of the charges. K.S.A. 1989 Supp. 72-5430a(a). The Secretary has power to adopt rules and regulations necessary to implement the professional negotiations act, K.S.A. 1989 Supp. 72-5432(a), and has established K.A.R. 49-23-6, which states a prohibited practice petition may be filed with the Secretary by a professional employee organization. K.A.R. 49-28-1 states that an allegation of a violation of K.S.A. 72-5430 may be filed with the Secretary by a professional employee organization.
There is no statutory time restriction for filing a complaint during negotiations. The statutes recognize that a prohibited practice could occur at any time as evidenced by several of the prohibited practices in K.S.A. 72-5430, including 72-5430(b)(2), which prohibits the Board from interfering with the existence of any professional employees’ organization, and 72-5430(b)(3), which prohibits the Board from discriminating in regard to hiring or encouraging or discouraging membership in any professional employees’ organization. The Board is also prohibited from instituting a lockout, and the Association is prohibited from striking or picketing. K.S.A. 72-5430(b)(8) and (c)(5). All of these prohibited practices could occur at any time during the school year. Logic dictates that a prohibited practice complaint may be filed at any time.
The Board argues that the Association ceased to be a real party in interest at the close of the collective bargaining process and, therefore, had no right to file a prohibited practice complaint based on the Board’s issuance of the unilateral contracts. The Board relies on Burrton Education Ass'n v. U.S.D. No. 369, 4 Kan. App. 2d 141, 604 P.2d 57 (1979).
Burrión does not support the Board’s argument that the Association ceases to be a real party in interest for purposes of filing a prohibited practice complaint after negotiations have ceased. The fact that the Association cannot ratify unilateral contracts does not mean the Association cannot file a prohibited practice complaint. K.A.R. 49-23-6 and 49-28-1 state that a prohibited practice petition may be filed by a professional employee organization. Neither regulation establishes time restrictions for the filing of the petition.
This court has defined a real party in interest as follows: “ ‘The real party in interest is the person who possesses the right sought to be enforced, and is not necessarily the person who ultimately benefits from the recovery.’ ” Citizens State Bank of Grainfield v. Kaiser, 12 Kan. App. 2d 530, 535, 750 P.2d 422, rev. denied 243 Kan. 777 (1988). The Association has been granted the statutory right to participate in professional negotiations with the Board as the exclusive representative of the professional employees. K.S.A. 72-5414; K.S.A. 72-5415. The Association may file a petition asking the Secretary to determine if impasse exists and participate in the impasse resolution procedures. K.S.A. 1989 Supp. 72-5426. The Association also possesses the right to have the Board negotiate in good faith and participate in good faith mediation. K.S.A. 72-5430. When filing the prohibited practice complaint, the Association sought relief which included an assurance by the Board that it would refrain in the future from interfering with the rights of the Association. The Association possesses the right to participate in good faith negotiations and impasse proceedings with the Board. This is the right the Association is seeking to enforce. As such, the Association is a real party in interest and may file a prohibited practice complaint against the Board.
In its complaint, the Association requested relief including that the Secretary order the Board to give retroactive effect, to the beginning of the school year, to the unilateral contract. The Secretary granted the relief and ordered the Board to pay the Association $7,700 as reimbursement to the teachers for the amount which the Board withheld to pay for its mediation and factfinding services. The Secretary granted relief based on K.S.A. 1989 Supp. 72-5430a(b), which states: “The secretary shall . . . enter a final order granting or denying in whole or in part the relief sought.”
The Board argues that the Secretary lacked authority to order the Board to pay $7,700 to the Association as a reimbursement. We agree with the Board but not for the reasons it suggests. Reimbursement, or making the contracts retroactive to the beginning of the 1985-86 school year, would benefit the teachers exclusively. Each individual teacher had the option to accept the unilateral contract offered by the Board, proceed under the continuing contract law, or join in the complaint filed by the Association. Eighteen of the twenty teachers signed the unilateral contracts. The names of the other two teachers were added to the complaint by the Association but were then removed at the request of those teachers. The two teachers who refused to sign a unilateral contract or join the Association in its complaint were two of four teachers who received no pay increase under the contract because their tenure exceeded the number of wage-increase steps set by the Board.
In Burrton, this court held that the authority of the professional employees’ representative to negotiate the teachers’ contracts terminated upon the exhaustion of impasse resolution procedures without the parties reaching an agreement and the Board’s issuance of unilateral contracts for the teachers. 4 Kan. App. 2d 141, Syl. ¶ 1. This court held that the decision to accept the unilateral contract offer proposed by the Board after the statutory negotiation process failed was an individual right of each teacher. The Association lacked power to ratify the unilateral contracts on behalf of the teachers. 4 Kan. App. 2d at 146. Likewise, in this case, the Association does not have the right to request or to receive a reimbursement on behalf of the teachers.
K.S.A. 1989 Supp. 72-5430a(b) grants the Secretary authority to dismiss the prohibited practice complaint or enter a final order granting in whole or in part the relief sought. The Association argues that, once the Secretary determines there is a prohibited practice, he is free to fashion the most appropriate remedy. The Board argues that 72-5430a(b) is limited in scope and grants the Secretary only the power to find that a prohibited practice has been committed and directs the party committing the practice to stop. In this case, because the teachers were not parties to the complaint, we agree with the Board for the reasons stated in the Burrton case. The Secretary’s award of $7,700 to the Association was not authorized. Whether 72-5430a(b) would authorize this relief if any of the teachers had joined in filing the complaint need not be decided here.
4. The constitutionality of K.S.A. 1989 Supp. 72-5430a(b).
The Board argues that K.S.A. 1989 Supp. 72-5430a(b) violates Article 2, § 1 of the Kansas Constitution, which provides: “The legislative power of this state shall be vested in a house of representatives and senate.” The Board alleges that K.S.A. 1989 Supp. 72-5430a(b), which provides that the Secretary “shall enter a final order granting or denying in whole or in part the relief sought,” is an unlawful delegation of legislative power to a nongovernmental association, namely the party requesting relief, because the statute contains no standards or guidelines to limit the authority to be exercised. Having determined above that the Secretary was not authorized to grant relief to the Association which was unique to the teachers, we need not address this issue.
We conclude the Association did have standing to file the prohibited practice complaint after negotiation proceedings ended and unilateral contracts were issued; the Board may include terms which were neither noticed for negotiation nor negotiated when issuing unilateral contracts; it is not a prohibited practice for the Board to offer less unilaterally than was bargained for collectively; the Board did commit a prohibited practice by reducing its unilateral contract offers by the amount of costs it had incurred in mediation and factfinding; the Board did not violate K.S.A. 72- 5429; and the Secretary did not have authority to order the Board to pay $7,700 to the Association for the reasons stated herein.
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Larson, J.:
The Kansas Department of Revenue appeals the order of the Johnson County District Court reversing the suspension of Michael Buchanan’s driver’s license.
Michael Buchanan was arrested and taken into custody for driving under the influence on February 7, 1987. The arresting officer read Buchanan the Miranda warning and, on videotape, went through the implied consent advisory procedure form. Buchanan refused to take the breath test.
Pursuant to K.S.A. 1986 Supp. 8-1001 and 8-1002, the Department of Revenue issued an administrative order suspending Buchanan’s driving privileges for six months. Buchanan filed a petition for review, alleging he did not receive the warning required by K.S.A. 1986 Supp. 8-1001(f)(l)(B) regarding mandatory suspension of a license upon refusal to take the breath test. The trial court issued an ex parte order staying the suspension of Buchanan’s license.
The trial court found in favor of Buchanan, stating that no evidence indicated he was informed of the warning required by K.S.A. 1986 Supp. 8-1001(f)(l)(B). The Department of Revenue appeals. Buchanan does not appear in the appeal.
The scope of review of an administrative decision by the Department of Revenue is established by K.S.A. 77-621:
“(a) Except to the extent that this act or another statute provides otherwise:
“(1) The burden of proving the invalidity of agency action is on the party asserting invalidity; and
“(2) the validity of agency action shall be determined in accordance with the standards of judicial review provided in this section, as applied to the agency action at the time it was taken.
“(b) The court shall make a separate and distinct ruling on each material issue on which the court’s decision is based.
“(c) The court shall grant relief only if it determines any one or more of the following:
“(1) The agency action, or the statute or rule and regulation on which the agency action is based, is unconstitutional on its face or as applied;
“(2) the agency has acted beyond the jurisdiction conferred by any provision of law;
“(3) the agency has not decided an issue requiring resolution;
“(4) the agency has erroneously interpreted or applied the law;
“(5) the agency has engaged in an unlawful procedure or has failed to follow prescribed procedure;
“(6) the persons taking the agency action were improperly constituted as a decision-making body or subject to disqualification;
“(7) the agency action is based on a determination of fact, made or implied by the agency, that is not supported by evidence that is substantial when viewed in light of the record as a whole, which includes the agency record for judicial review, supplemented by any additional evidence received by the court under this act; or
“(8) the agency action is otherwise unreasonable, arbitrary or capricious.
“(d) In making the foregoing determinations, due account shall be taken by the court of the rule of harmless error.”
“ ‘A district court may not, on appeal, substitute its judgment for that of an administrative tribunal ....’” Board of Johnson County Comm’rs v. J.A. Peterson Co., 239 Kan. 112, 114, 716 P.2d 188 (1986).
The administrative order suspending Buchanan’s license did not violate any of the provision of K.S.A. 77-621(c)(l) through (8).
K.S.A. 1986 Supp. 8-1001(f)(l)(B) provides:
“Before a test or tests are administered under this section, the person shall be given oral and written notice that . . . (B) refusal to submit to and complete any test of breath, blood or urine hereafter requested by a law enforcement officer will result in six months’ suspension of the person’s driver’s license.”
Buchanan argues that he was not properly advised that his refusal to submit to the breath test would result in the suspension of his driving privileges. He stated at the trial:
“I have no memory of any implication or any understanding that I would be losing my driver’s license if I didn’t take the breathalyzer test, which is really the issue here. . . .
“I do not recall there being anything said that implied that [the suspension of the license] would just be a fact. There may have been a mention that that is a possibility, or something like that, or at least that was my interpretation, that if anything did transpire like that. It was not presented as something that was just a matter of fact.”
Buchanan may not have completely understood all of the ramifications of his choices; however, that is not required by the statute. The statute requires only that the warnings be given, and "[i]t shall not be a defense that the person did not understand the written or oral notice required by this section.” K.S.A. 1986 Supp. 8-1001(f)(l) and (3).
There was ample evidence to show that Buchanan received the statutory warning. Question two on the implied consent form was checked by the arresting officer. It reads, “If you refuse to submit to and complete any test of breath, blood or urine hereafter requested by a law enforcement officer, your refusal will result in the suspension of your driver’s license for six (6) months.” The arresting officer testified that he read or advised the defendant of all the required warnings and checked them off on the implied consent form. He also testified that he made the specific warning regarding suspension.
The videotape conclusively shows that Buchanan was given the warnings required by the implied consent statute. He was read the first six warnings on the Implied Consent Advisory Procedure form. During the discussion of whether Buchanan should submit to the test, the officer told him that if he refused, his license would be suspended for six months, or up to six months. There was no evidence which supports the findings and rulings of the trial court, which are reversed.
The Department of Revenue also alleges that the trial court erred in issuing an ex parte order staying the suspension of Buchanan’s driver’s license. The trial court’s review of an administrative order suspending a driver’s license is governed by the Act for Judicial Review and Civil Enforcement of Agency Actions at K.S.A. 77-601 et seq. Angle v. Kansas Department of Revenue, 12 Kan. App. 2d 756, Syl. ¶ 1, 758 P.2d 226, rev. denied 243 Kan. 777 (1988). K.S.A. 77-616(f) of the Act clearly states: “Except as otherwise authorized by rule of the supreme court, the court shall not issue any ex parte order pursuant to this section.” No Supreme Court rule authorizes the entry of ex parte stay orders.
While at this point it might be argued that this issue is moot, Stone v. Kansas State High School Activities Ass’n, Inc., 13 Kan. App. 2d 71, 761 P.2d 1255 (1988), holds that an appellate court may decide a moot question arising from a real controversy when the question is of statewide importance, the question is likely to arise again in the future, and the question will ordinarily be mooted before it can be considered on appeal.
A trial court is clearly prohibited by the statute from issuing any ex parte order in any action subject to the Kansas Act for Judicial Review and Civil Enforcement of Agency Actions.
Reversed. The Department of Revenue’s order suspending Buchanan’s license for six months is reinstated. | [
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Gernon, J.:
Paul Schowengerdt appeals from the district court’s affirmance of the suspension of his driver’s license by the Department of Revenue. Schowengerdt contends on appeal that the driving privileges of a driver whose license has expired may not be suspended.
In October of 1988, Schowengerdt was arrested for speeding. At the time of his arrest, he was given an Intoxilyzer test, which he failed. The officer’s notice of suspension indicated Schowengerdt’s license to drive had expired. Schowengerdt requested a hearing concerning his suspension. The hearing officer of the Department of Revenue affirmed the suspension.
Schowengerdt timely filed a petition for review to the district court, which affirmed the holding of the hearing officer. Schowengerdt then appealed.
As a preliminary matter, the Department of Revenue argues that Schowengerdt lacks standing. The Department argues that Schowengerdt has no-personal stake in the outcome of this case because he alleges he had no right to drive even before his license was suspended. We reject • this . argument. Schowengerdt’s suspension obviously could affect him in many ways. He might be prevented from obtaining a- driver’s license, or, if apprehended while driving, his status -of having a suspended license would constitute a Class B misdemeanor. Therefore, we conclude Schowengerdt has standing to raise the issue before this court.
Schowengerdt’s license had expired when he was arrested for speeding and failed the Intoxilyzer test. He argues that the Department of Revenue cannot suspend his driver’s license because he had no driver’s license to suspend.
Schowengerdt notes that K.S.A. 1988 Supp. 8-235(a) provides: “No person, except those expressly exempted, shall drive any motor vehicle upon a highway in this state unless such a person has a valid driver’s license.”
Schowengerdt cites two Alaska cases, both criminal in nature, which hold that, because there is no “innate privilege to drive” and the defendant had no license, it was impossible for the State to have suspended his driving privileges. Roberts v. State, 700 P.2d 815 (Alaska App. 1985).
The Department, however, asserts that the Kansas implied consent law is to be liberally construed to effectuate its obvious purpose of protecting the safety and welfare of the motoring public. State v. Adee, 241 Kan. 825, 829, 740 P.2d 611 (1987). The Department contends that the Alaska cases cited by Schowengerdt are distinguishable from the present case. For example, in Francis v. Municipality of Anchorage, 641 P.2d 226 (Alaska App. 1982), the 15-year-old driver never had a license to drive and was charged with driving while his license was suspended. In Roberts, the appellant was never licensed by the State of Alaska and his California license had expired prior to his arrest in Alaska.
In Fielding v. State, 733 P.2d 271 (Alaska App. 1987), the defendant was validly licensed to drive at the time his license was revoked for three years. Later he was convicted of driving while his license was revoked, which added one additional year to his revocation. Three years later he was convicted of driving under the influence and again of driving while his license was revoked, which added two more years to his revocation. So far as the last conviction was concerned, his license had expired prior to the last conviction, which then added two more years to the revocation.
The Alaska court distinguished the holdings in Francis and Roberts in the Fielding case and affirmed Fielding’s conviction, reasoning that the revocation was valid for the period ordered even though his license had expired when he was convicted after the expiration.
The Department correctly points out the rules of statutory construction as noted in State v. Adee, 241 Kan. at 829:
“At this point, the applicable rules of statutory construction should be stated. The fundamental rule of statutory construction is that the purpose and intent of the legislature governs when the intent can be ascertained from the statute. In construing statutes, the legislative intention is to be determined from a general consideration of the entire act. Effect must be given, if possible, to the entire act and every part thereof. To this end, it is the duty of the oourt, as far as practicable, to reconcile the different provisions so as to make them consistent, harmonious, and sensible. Harris Enterprises, Inc. v. Moore, 241 Kan. 59, Syl. ¶ 1, 734 P.2d 1083 (1987); State v. Cole, 238 Kan. 370, 371-72, 710 P.2d 25 (1985). . . . Where a statute is designed to protect the public, the language must be construed in the light of the legislative intent and purpose and is entitled to broad interpretation so that its public purpose may be fully carried out. Johnson v. Killion, 178 Kan. 154, Syl. ¶ 4, 283 P.2d 433 (1955). A construction which renders part of a legislative act surplusage is to be avoided if reasonably possible. American Fidelity Ins. Co. v. Employers Mut. Cas. Co., 3 Kan. App. 2d 245, Syl. ¶ 4, 593 P.2d 14 (1979).”
Following the rules of construction in Adee, we conclude that, if a license or privilege exists, it is subject to suspension, and it can be suspended for any period permitted by :law. Once suspended, the suspension remains in effect for the full period ordered, regardless of whether the originally valid license might otherwise have expired at some point during the period of suspension. To hold otherwise would be counter .to logic and would allow a driver to benefit from letting his driver’s license expire. It is the privilege to drive that is suspended. The license itself merely represents that privilege.
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Brazil, J.:
Arthur Marks appeals the sentence imposed by the district court after he pleaded guilty to one count of possession of cocaine with intent to sell (K.S.A. 1989 Supp. 65-4127a[a]). Marks contends that he was denied due process because the State breached its plea agreement by opposing his motion to reconsider the motion for modification of sentence and that the district court erred in refusing to follow the State Reception and Diagnostic Center (SRDC) recommendation to modify his sentence without making the required statutory findings. We affirm in part, reverse in part, and remand for further proceedings.
Marks was charged with one count of selling cocaine and one count of possessing cocaine with intent to sell. The State dismissed the former count, and Marks pleaded guilty to the latter. He was sentenced to five to twenty years in prison. Marks filed a motion for modification of sentence, which the district court heard and denied. Marks then filed a motion to reconsider the motion to modify, which was also heard and denied.
1. Plea agreement.
Ambiguous plea agreements must be read strictly against the State. State v. With, 244 Kan. 62, 69, 765 P.2d 1114 (1988). The Wills court found the State’s agreement, which required a favorable recommendation at sentencing but which did not address post-sentencing hearings, applied to a hearing on the defendant’s motion to modify the sentence. 244 Kan. at 69-70. Because the State in Wills had breached the agreement at the hearing on the motion to modify the sentence, the Supreme Court remanded the case to have the motion to modify reheard by a different district court judge. 244 Kan. at 70.
The plea agreement in the present case provided that, in exchange for Marks’ plea of guilty to the present charge, the prosecution would drop the other charge and recommend a minimum sentence but oppose probation. Possession of cocaine with intent to sell is a class C felony. K.S.A. 1989 Supp. 65-4127a. The minimum sentence for a class C felony is three to ten years in prison. K.S.A. 21-4501(c). At the sentencing hearing, the State recommended a sentence of three to ten years in prison, thus honoring the plea agreement. The district court nevertheless sentenced Marks to five to twenty years in prison.
At the hearing on Marks’ motion to modify sentence, Marks’ attorney incorrectly informed the district court that it had imposed a minimum sentence and that all Marks was seeking was probation. The court orally denied the motion to modify sentence and stated that it had imposed a minimum sentence.
Before the district court filed a journal entry on its denial of the motion to modify, Marks filed a motion to reconsider the motion to modify on the ground that his attorney had misinformed the court about his sentence. At the hearing on the motion to reconsider, Marks’ attorney pointed out that he had misinformed the court at the prior hearing, that Marks had received a sentence greater than the minimum allowed, and that Marks was requesting the minimum sentence. The State, contrary to the plea agreement, opposed the motion, and the court denied it.
Wills controls this issue. Just as in Wills, the plea agreement in the present case is ambiguous because it did not address the question of whether the agreement applied to Marks’ motions to modify and to reconsider the motion to modify. 244 Kan. at 69-70. As in Wills, therefore, the State bore the risk of ambiguity and was bound by the agreement regarding both the motion to modify and the motion to reconsider. The State breached the agreement and the case must be remanded to a different district judge to rehear Marks’ motion to modify sentence.
The State argues the district court did not have jurisdiction to consider the motion to reconsider because it constituted a motion to alter and amend under K.S.A. 60-259(f), and Marks failed to file the motion within the ten-day limitation for such motions. Assuming for purposes of the State’s argument that Marks’ motion was one to alter or amend and that K.S.A. 60-259(f) is applicable, the statute provides that motions must be filed within ten days after “entry of the judgment.” K.S.A. 60-258 defines entry of judgment as the filing with the clerk of the court a journal entry or judgment form signed by the trial judge.
Our Supreme Court has held that K.S.A. 60-258 does not apply to the rendering of judgments and the imposition of sentence in criminal cases. State v. Moses, 227 Kan. 400, 403, 607 P.2d 477 (1980). The court held that those instances are governed by K.S.A. 22-3424 and -3426, and that appeal time must be computed from the oral pronouncement of sentence.
Accepting the State’s argument that Marks’ motion was one to alter or amend under K.S.A. 60-259(f), and noting that there is no specific statute governing such motions in chapter 22 of the Kansas Statutes Annotated, we conclude that the present case is distinguishable from Moses and that K.S.A, 60-258 is applicable. As noted in State v. Myers, 10 Kan. App. 2d 266, 271, 697 P.2d 879 (1985):
“The rationale For running the 120-day appeal time from oral pronouncement of the sentence is unique to sentencing. See State v. Moses, 227 Kan. 400, 402, 607 P.2d 477 (1980), and cases cited therein. K.S.A. 1984 Supp. 22-3405(1) requires that the defendant be present when sentence is imposed. The defendant’s presence at sentencing insures defendant’s immediate notice of the sentence imposed and the opportunity to timely pursue an appeal. However, the presence of a defendant at the pronouncement of the decision on a post-sentencing motion is discretionary with the district court. State v. Bryant, 227 Kan. 385, 390, 607 P.2d 66 (1980).”
In Myers, our court held that the defendant had ten days to file his notice of appeal after the filing of a journal entry denying his motion to modify. 10 Kan. App. 2d at 270.
Likewise, in the present case, the ten-day limitation runs from the date the order denying the motion to modify is journalized, not from when it is orally issued. See Miller v. Miller, 6 Kan. App. 2d 193, 195, 627 P.2d 365 (1981). The ten-day limitation could not have been exceeded in the present case because Marks’ motion to reconsider was filed before the denial of the motion to modify was journalized.
2. K.S.A. 1989 Supp. 21-4603(3)(a).
Marks argues the trial court erred in holding the current “authorized dispositions” statute, K.S.A. 1989 Supp. 21-4603(3)(a), inapplicable at the hearing on the motion to reconsider. That statute provides 'that within 120 days after sentencing a trial court “shall modify [a] sentence if recommended by the state reception and diagnostic center unless the court finds that .the safety of the public will be jeopardized and that the welfare of the inmate will not be served by such modification.” (Prior to the 1989 amendment, the statute provided only that the court may modify a sentence.) The SRDC report recommended Marks continue to be incarcerated and that “it is strongly recommended that consideration be given to a sentence length modification, which would allow Mr. Marks to rejoin society at an earlier date.” Marks argues the district court erred in failing to follow the SRDC recommendation.
The district court found K.S.A. 1989 Supp. 21-4603(3)(a) inapplicable and apparently applied the previous version, K.S.A. 21-4603(3). The previous statute provided the court “may” modify a sentence within 120 days of sentencing. The present statute became effective on July 1, 1989. Marks was sentenced and his motion to modify was heard before the above statute became effective. Likewise, the report of the SRDC was compiled before the statute became effective.
Marks filed his motion to reconsider after the effective date of the new statute. Thus, the new statute was effective when the district court refused to apply it at the hearing on the motion to reconsider. Marks argues the present statute is applicable because it became effective before the motion to reconsider was filed. The State argues, however, that, the now-repealed version is applicable because it was effective when the motion to modify sentence was heard and the same statute should later be applied at the hearing on the motion to reconsider.
“While it is ... a general rule of statutory construction that a statute will operate prospectively unless its language clearly indicates the contrary, that rule is modified where the statutory change is merely procedural or remedial in nature and does not affect the substantive rights of the parties. State v. Hutchinson, 228 Kan. 279, Syl. ¶¶ 6, 7, 615 P.2d 138 (1980). In Hutchinson we stated:
‘As related to criminal law and procedure, substantive law is that which declares what acts are crimes and prescribes the punishment therefor; whereas procedural law is that which provides or regulates the steps by which one who violates a criminal statute is punished.’ 228 Kan. at 287.” State v. Nunn, 244 Kan. 207, 216, 768 P.2d 268 (1989).
In Nunn, the Supreme Court found that criminal statutes of limitation are remedial or procedural, not substantive, and could be applied retroactively.
Is K.S.A. 1989 Supp. 21-4603(3) substantive or procedural? In State v. Henning, 3 Kan. App. 2d 607, 609, 599 P.2d 318 (1979), this court held that K.S.A. 1978 Supp. 21-4608(5) was substantive and must be applied prospectively. That, section of the statute extended the permissible authorized sentencing to allow a Kansas sentence to run concurrently with another state’s sentence for an offense committed prior to the defendant’s Kansas sentence.
For purposes of distinguishing between substantive statutes that prescribe punishment as opposed to merely procedural statutes, we conclude that K.S.A. 1989 Supp. 21-4603(3)(a), changing sentence modification, is similar to the statute considered in Henning. K.S.A. 1989 Supp. 21-4603(3)(a) materially limits the court’s sentencing discretion and is therefore substantive not procedural. It must be applied prospectively.
The penalty for a criminal offense is the penalty provided by statute at the time of the commission of the offense. Kelsey v. State, 194 Kan. 668, 670, 400 P.2d 736 (1965). The offense in this case occurred on or about December 27, 1988, prior to the effective date of K.S.A. 1989 Supp. 21-4603(3)(a). The trial court’s finding that the statute was inapplicable is affirmed. Obviously, upon remand, this holding does not preclude the trial court from modifying its sentence under K.S.A. 21-4603(3).
Affirmed in part, reversed in part, and remanded for a new hearing before a different judge on the motion to modify. The State is ordered to comply with its plea agreement. | [
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Wahl, J.:
Kansas City Post Office Employees Credit Union, appeals the trial court’s judgment in favor of Systems Design and Management Information, Inc., (SDMI) on its counterclaims for breach of contract and fraudulent and negligent misrepresentation. It also appeals the trial court’s application of Kansas law. SDMI cross-appeals on the trial court’s entry of judgment for the credit union on SDMI’s breach of contract claim.
On November 1, 1986, the Kansas City Post Office Employees Credit Union merged into the Kansas City Telephone Employees Credit Union. The surviving credit union is now called the Communications Credit Union (Credit Union). SDMI develops computer software programs for credit unions, using Burroughs, now Unisys, hardware. SDMI is not a service bureau. It does not furnish computer services from its computer system to credit unions or manage any data on a daily basis. SDMI furnished software to the Kansas City Post Office Employees Credit Union and had an ongoing business relationship with it beginning in 1984. Prior to the merger of the two credit unions, Robert Miller, a salesman for Burroughs, told Davis Tyler, president of SDMI, about the proposed merger and the two developed a proposal in an attempt to get the new credit union’s account.
This proposal was jointly offered by SDMI and Burroughs, using the so-called Generic System software, the subject of this litigation, and Burroughs hardware. This proposal was dated November 4, 1986, and contained the following clause:
“The preliminary information and expression of confidence set forth in this recommendation of Burroughs products and/or services are submitted for your consideration and guidance only in the hope that we may be favored with your order. Since this proposal is preliminary only, the order when issued shall constitute the only legally binding commitment of the parties.”
Sometime in November 1986, a demonstration of the software was held at SDMI’s offices. Daniel Yantis, president and general manager of Credit Union, and Donald Cooper, vice-president in charge of marketing of Credit Union, recommended the purchase of the Generic System software and the credit union board accepted their recommendation. On November 25, 1986, Cooper phoned Davis Tyler of SDMI to say Credit Union would purchase the SDMI Generic System. This agreement between the parties was oral and no written order for the software was ever issued. Credit Union was converted to the SDMI Generic System on February 1-2, 1987.
Immediately, major problems with the system became apparent. Some of the problems included inability to run the payroll, inability to generate certain daily reports, some nonfunctioning printers and terminals, and an inability to perform all the normal operations during regular working hours.
There is disagreement as to the cause of these problems. Ultimately, there were about 11,000 accounts after the merger of the credit unions. The parties disagree as to whether Credit Union disclosed or whether SDMI knew how many accounts the system would have to handle. There is further disagreement whether the number of accounts was misrepresented by Credit Union as 8,000 to 9,000 and whether Credit Union was informed by SDMI that with that number of accounts the system would not work efficiently. In any event, even after discovering that the system would have to handle 11,000 accounts, Cooper recommended that Credit Union proceed with the conversion.
After the conversion, there were many out-of-balance accounts, perhaps thousands. Through the efforts of both parties, the number of out-of-balance accounts was reduced to 293 by March 25, 1987.
On March 23, 1987, a meeting between Cooper and Tyler was held and they signed a “status chart” which outlined the major problems still to be solved by SDMI. This form stated, “When these items have been resolved all monies due SDMI will be paid. ” Apparently, all the items listed except installing a program to “correct blocking” were performed. The purpose of that program was to speed up the system and to accommodate the total membership of Credit Union. Also on March 23, 1987, Cooper gave Tyler a letter expressing understanding that “few conversions come off without a hitch” and thanking him for SDMI’s efforts to deal with Credit Union’s problems.
On March 19, 1987, Yantis and Cooper met with representatives of another company seeking software to replace the SDMI Generic System. Credit Union quit using the SDMI software on April 25, 1987, without having notified SDMI that it was switching to another software program.
SDMI filed suit against Credit Union to recover the outstanding indebtedness on the software. Credit Union counterclaimed for damages based upon breach of contract and negligent and fraudulent misrepresentation. The trial court entered judgment in favor of Credit Union on SDMI’s cause of action and judgment for SDMI on Credit Union’s counterclaim. These appeals followed judgment.
SDMI’s business office is located in Kansas. Credit Union’s business offices are located in Missouri.
Credit Union argues that the trial court should have applied Missouri law in this case. The trial court applied Kansas law, acknowledging the lex loci contractus principle. The court then found the demonstration of the Generic System was in Kansas, Credit Union telephoned SDMI at SDMI’s Kansas office to express intent to purchase the software, and the March 23, 1987, document was signed in Kansas; thus, Kansas law governed.
The actual event which constituted the breach is not clear from the record on appeal or from the journal entry filed by the court. In Shutts v. Phillips Petroleum Co., 235 Kan. 195, 679 P.2d 1159 (1984), rev’d in part on other grounds, 472 U.S. 797, 86 L.Ed. 2d 628, 105 S. Ct. 2965 (1985), the court stated, “The general rule is that the law of the forum applies unless it is expressly shown that a different law governs, and in case of doubt, the law of the forum is preferred.” 235 Kan. at 221. Although the choice of law portion of the opinion was reversed in the later United States Supreme Court case, 472 U.S. at 822-23, the general rule is still applicable insofar as it does not conflict with constitutional limitations. As long as Kansas has “ ‘significant contact or significant aggregation of contacts’ ... to ensure that the choice of Kansas law is not arbitrary or unfair,” constitutional limits are not violated. 472 U.S. at 821-22. In the case at bar, the contacts with both Kansas and Missouri are numerous, and the choice of one state’s law over another does not appear to raise constitutional issues.
It is not expressly clear from the record or from the journal entry that Missouri law should apply. Therefore, the trial court did not err in holding Kansas law applied to the merits of this case. The trial court relied upon a different rule than we have discussed, but “[t]he reasons given by the district court for its decision are immaterial so long as its ruling was correct for any reason.” Prairie State Bank v. Hoefgen, 245 Kan. 236, 245, 777 P.2d 811 (1989).
For its cross-appeal, SDMI argues the Uniform Commercial Code should have governed the trial of this case because computer software is “goods” under the U.C.C. We agree. The pretrial order set forth questions of law for determination at trial, including application of the U.C.C. However, there were no explicit findings at trial concerning the applicability of the U.C.C.; whether the software qualified as “goods,” and, if so, the duties of the parties as to statutory requirements; and whether SDMI’s cause of action for breach of contract was barred by the statute of frauds under the U.C.C.
“Goods” is defined in Article 2 of the U.C.C. as “all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities (article 8) and things in action.” K.S.A. 84-2-105(1). Kansas has not decided the question of whether computer software falls under this definition of goods, and neither have most jurisdictions.
The character of computer software has been addressed in the context of tangible versus intangible personal property for the purpose of taxation. In re Tax Protest of Strayer, 239 Kan. 136, 716 P.2d 588 (1986). In Strayer the court held that application software programs, as opposed to operational programs, are intangible personal property and not subject to the personal property tax. 239 Kan. at 143. The U.C.C. is, however, a totally different statutory scheme with a purpose quite different from the tax code. According to K.S.A. 84-1-102(2), the purpose and policy of the U.C.C. is:
“(a) to simplify, clarify and modernize the law governing commercial transactions;
“(b) to permit the continued expansion of commercial practices through custom, usage and agreement of the parties;
“(c) to make uniform the law among the various jurisdictions.”
We must determine whether the oral agreement between SDMI and Credit Union was for goods or services. The test when dealing with a mixed contract is “ ‘not whether they [goods or services] are mixed, but, granting that they are mixed, whether their predominant factor, their thrust, their purpose, reasonably stated, is the rendition of service, with goods incidentally involved ... or is a transaction of sale, with labor incidentally involved.’ ” Care Display, Inc. v. Didde-Glaser, Inc., 225 Kan. 232, 238, 589 P.2d 599 (1979) (quoting Bonebrake v. Cox, 499 F.2d 951, 960 [8th Cir. 1974]).
Contracts for a data processing service’s skill, Liberty Fin. Mgmt. v. Beneficial Data, 670 S.W.2d 40, 48-49 (Mo. App. 1984), and contracts for analysis, collection, storage, and reporting of data, Computer Servicenters, Inc. v. Beacon Manufacturing Co., 328 F. Supp. 653 (D.S.C. 1970), have been held not to fall under the U.C.C. as sales of goods. In the present case, there is general agreement that SDMI is not a service bureau so these cases would be inapplicable.
Another line of cases involves contracts for the sale of custom software designed specifically for the customer’s needs. In RRX Industries, Inc. v. Lab-Con, Inc., 772 F.2d 543, 546 (9th Cir. 1985), the court found the sales aspect of the transaction to be predominant while employee training, repair services, and system upgrading were all incidental to the sale of the software. The court did say, due to the variance in software based upon the needs of the customer, it would engage in a case-by-case analysis on this issue. In Data Processing v. L. H. Smith Oil Corp., 492 N.E.2d 314, 319 (Ind. App. 1986), the court found software was not goods. This case involved custom-designed accounting software and the court reasoned the contract was for the program producer’s “knowledge, skill, and ability,” and the product on which the program was transmitted was incidental to the contract.
The cases in which we find the closest analogy to the case before us involve the sale of both computer hardware and software as a system. SDMI and Burroughs offered a joint proposal of sale to the credit union. Burroughs would provide the hardware and SDMI would furnish the software. Of course, the case before us involves only the software, not the hardware.
In Triangle Underwriters, Inc. v. Honeywell, Inc., 457 F. Supp. 765 (E.D.N.Y. 1978), modified 604 F.2d 737 (2d Cir. 1979), Triangle purchased hardware and software from Honeywell. Recognizing that payment was made for the purchase price of the system and not for services to install or maintain it, the court stated the contract was one for sale. “Although the ideas or concepts involved in the custom-designed software remained Honeywell’s intellectual property, Triangle was purchasing the product of those concepts.” 457 F. Supp. at 769. In Neilson Bus. Equip. Ctr. v. Monteleone, 524 A.2d 1172 (Del. 1987), the court ruled sale of computer hardware and software as a package, termed a turn-key system, was goods and the consulting services provided with the sale were ancillary to the contract. 524 A. 2d at 1174-75.
Prior to entering into an agreement for the Generic System software, Credit Union attended a demonstration of the program at SDMI’s place of business. Therefore, we conclude the software was movable at the time of identification to the contract, satisfying that requirement of the definition of goods. SDMI installed the Generic System software on Credit Union’s computer and was present to attempt modifications and corrections of the program so the accounting system would run more efficiently. These services are incidental to the sale of the software because, without Credit Union buying the Generic System program, the services would not be necessary. Therefore, the sale of the software is predominant. SDMI remains the owner of the accounting program as intellectual property. Credit Union purchased only a reproduction or the result of the programmer’s skill. Credit Union is interested only in the outcome of running the program and whether the program will perform the functions for which it was purchased.
We hold this software to be goods and subject to the provisions of the U.C.C. This holding is consistent with the purpose of the U.C.C. It simplifies commercial transactions. It provides a uniform rule for courts to follow.
Having found the application of the U.C.C., we need not determine the other issues raised on appeal, such as whether Credit Union’s counterclaim was considered by the court. It was not considered under the provisions of the U.C.C., nor were the other issues raised.
We affirm the trial court’s application of Kansas law at the hearing of this case. The remaining judgment of the trial court is reversed and remanded for further proceedings in accordance herewith. | [
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Lewis, J.:
This is an appeal by appellant from the decision of the trial court to revoke his probation and reinstate his original sentence.
The facts are the typical facts that this court is seeing with increasing frequency. The scenario is rather simple: a defendant pleads guilty to a crime, is sentenced, but is given the privilege of probation on certain conditions. That defendant then violates the terms of his probation by committing an additional crime and then complains when the judge revokes the probation. It is very difficult to find merit in an appeal of this nature.
Justice Holmes of the Kansas Supreme Court in Baker v. State, 243 Kan. 1, 10, 755 P.2d 493 (1988), stated:
“In an appeal from a criminal conviction, appellate counsel should carefully consider the issues, and those that are weak or without merit, as well as those which could result in nothing more than harmless error, should not be included as issues on appeal. Likewise, the fact that the defendant requests such an issue or issues to be raised does not require appellate counsel to include them. Conscientious counsel should only raise issues on appeal which, in the exercise of reasonable professional judgment, have merit. ”
The same admonition is applicable to an appeal from a denial of a motion seeking relief under K.S.A. 60-1507.
In this case, the defendant entered a plea of guilty to charges of misdemeanor theft and felony criminal damage to property. He was sentenced to concurrent terms of one year on the theft charge and one to two years on the criminal damage to property charge.
Within a year of having been granted probation, defendant committed another crime in direct violation of his probation agreement. This violation was dutifully reported to the court and a due process hearing was held. The trial court found defendant had violated the terms of his probation, revoked that probation, and remanded defendant to the custody of the secretary of corrections.
Finding no error, we affirm.
Appellant’s sole argument on appeal is that the trial court abused its discretion when it revoked his probation. ■ The gist of his argument is that, because alcohol abuse is his real problem, probation should have been continued so that he could seek treatment for alcohol abuse.
Aside from the fact that the secretary of corrections offers numerous programs designed to deal with alcohol abuse, we hold the trial court did not abuse its discretion.
“Judicial discretion is abused when judicial action is arbitrary, fanciful or unreasonable, which is another way of saying that discretion is abused only where no reasonable [person] would take the view adopted by the trial court.” Stayton v. Stayton, 211 Kan. 560, 562, 506 P.2d 1172 (1973). “The test on appellate review of whether the trial court abused its discretion is whether no reasonable person would agree with the trial court.” Hoffman v. Haug, 242 Kan. 867, 873, 752 P.2d 124 (1988).
It is readily apparent to this court, and we so hold, that the trial court did not abuse its discretion in revoking probation in this case.
Appellant’s probation was revoked because he violated the first condition of that probation, to refrain from violating the law. As we have pointed out on many occasions, probation is not a matter of right but a privilege, and one who willfully violates the conditions of that probation is not in a position to complain when it is revoked as a result of his own unlawful activities. The action of the trial court revoking appellant’s probation is affirmed.
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White, J.:
Steve Gaylord appeals from the district court’s ruling affirming the termination of his teaching contract pursuant to K. S.A. 72-5436 et seq. by the Board of Education, Unified School District No. 218, Morton County, Kansas (Board). Gaylord argues that there was not substantial evidence to support the finding of insubordination and that the Board’s decision .to terminate the contract was, therefore, arbitrary and capricious. We affirm.
In April 1987, the Board voted to renew Gaylord’s teaching contract for the 1987-88 school year. Gaylord decided to explore employment opportunities elsewhere and scheduled a job interview in Bovina, Texas, for May 21, 1987. Gaylord requested personal leave lor that Jay, which fell during the last week of the school year. Principal Steve Barnes denied the request pursuant to the negotiated agreement) which forbade, teacher absences the first or last week of any semester. Barnes told Gaylord that Superintendent Kenneth Fowler was the' only one who could grant personal leave during that time period. Fowler, also denied Gaylord’s request.
Gaylord’s wife called Barnes on the morning of May 21 and reported Gaylord was ill and would not be at work. Later that day, Fowler received a call from the high school principal in Bovina soliciting a recommendation for Gaylord. From that conversation, Fowler learned Gaylord had been in Bovina that morning. , ,
The following day, Gaylord completed a sick leave form and attached a note from his physician. Fowler called Gaylord to his office, told , him he knew about the Texas interview, requested his keys, and told him to leave school property. Gaylord was later notified of the Board’s intent to terminate his contract. The reasons given for the Board’s action were inisubordination, failure to follow Board policy, and abusive treatment of students!
A due process hearing was conducted,'' and the panel determined, by a two to one vote, that there was just cause to terminate Gaylord’s contract on a finding of insubordination based on the May 21, 1987, absence. The hearing panel unanimously concluded there was insufficient evidence of failure to follow Board policy and insufficient evidence of abusive treatment of students to warrant termination.
Following the statutory mandate to review less than unanimous decisions of a hearing panel, the Board considered the opinion and voted to terminate Gaylord’s teaching contract. Gaylord timely perfected his appeal to the district court. The district court affirmed the Board’s decision.
On review of a Board’s decision, “[t]he district court may not hear the case de novo, but is limited to deciding whether: (1) The Board’s decision was within the scope of its authority; (2) its decision was substantially supported by the evidence; and (3) it did not act fraudulently, arbitrarily, or capriciously.” Butler v. U.S.D. No. 440, 244 Kan. 458, 463, 769 P.2d 651 (1989). We are subject to the same limitations of review as the district court. 244 Kan. at 464.
In order to terminate a tenured teacher, a board of education must follow the procedures set out in K.S.A. 72-5436 et seq. Bauer v. U.S.D. No. 452, 244 Kan. 6, 9, 765 P.2d 1129 (1988). K.S.A. 72-5443 provides in relevant part:
“(b) If the members of the hearing committee are unanimous in their opinion, the board shall adopt the opinion as its decision in the matter and such decision shall be final, subject to appeal to the district court as provided in K.S.A. 60-2101, and amendments thereto.
“(c) If the members of the hearing committee are not unanimous in their opinion, the board shall consider the opinion, hear oral arguments or receive written briefs from the teacher and a representative of the board, and decide whether the contract of the teacher shall be renewed or terminated.”
Under the facts of this case, since the hearing committee members were unanimous in their opinion on the charge of failure to follow Board policy and on the charge of abusive treatment of students, the Board was required to adopt the committee’s opinion and was precluded from considering any evidence as to those issues. K.S.A. 72-5443(b). Considering the committee was not unanimous on the insubordination charge, the Board was required under K.S.A. 72-5443(c) to consider the opinion and decide whether Gaylord’s contract should be terminated.
The hearing committee based its recommendation of termination for insubordination on the May 21 absence. Under the statute, the Board should only have considered the hearing com mittee’s opinion on that issue and rendered its decision on the same. Although the Board may have expanded its reach, the district court only considered the evidence on the issue of insubordination based on the May 21, 1987, incident. As the district court stated:
Pursuant to K.S.A. 72-5443, when more than one reason is given for nonrenewal or termination of a teacher’s contract, and the hearing committee is unanimous on one [or] more reasons but not unanimous on one or more reasons the board of education is required to adopt the unanimous portions of the committee’s decision and may make its own decision on the nonunanimous portions.”
The only issue to be considered for review by this court is the charge of insubordination. There is no contention that the Board acted outside the scope of its authority but only whether there was substantial evidence to support its finding.
“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. [Citation omitted.] 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.” Williams Telecommunications Co. v. Gragg, 242 Kan. 675, 676, 750 P.2d 398 (1988).
Insubordination is defined as “disobedience to constituted authority. Refusal to obey some order which a superior officer is entitled to give and have obeyed. Term imports a wilful or intentional disregard of the lawful and reasonable instructions of the employer.” Black’s Law Dictionary 720 (5th ed. rev. 1979).
In Learning v. U.S.D. No. 214, 242 Kan. 743, 750 P.2d 1041 (1988), the plaintiff teacher willfully disobeyed the directions of his superintendent and attended a science fair. Learning admitted he had signed a contract which required him to obey rules and regulations of the board of education and the directions of the superintendent and that he had defied those directions. By absenting himself and by willfully disobeying the directions of the superintendent, Learning violated his contract and, therefore, was properly terminated.
Although Kansas has not addressed insubordination in the context of teacher termination cases, in other jurisdictions insubordination has been found where the teacher refused to accept a teaching or school assignment, refused to admit a student to class, or has been absent without authorization. Annot., 78 A.L.R.3d 88.
Some courts have found insubordination in a single incident. See Crump v. Bd. of Education, 79 N.C. App. 372, 339 S.E.2d 483, rev. denied 317 N.C. 333 (1986). Other courts have concluded insubordination can only occur when there is a constant or persistent course of conduct. See Sims v. Bd. of Trustees, Holly Springs, Etc., 414 So. 2d 431 (Miss. 1982).
In Ware v. Morgan Cty. School D. No. RE-3, 748 P.2d 1295, 1300 (Colo. 1988), the court stated that, by interpreting insubordination
“to include the willful or intentional disobedience of a reasonable order on a particular occasion, we provide the school board with the necessary latitude to determine whether, in light of community standards and subject to judicial review, the teacher’s conduct on the occasion in question was sufficiently serious or aggravated to warrant an ultimate finding of insubordination and the serious sanction of dismissal.”
In Board of Educ. of Laurel County v. McCollum, 721 S. W.2d 703 (Ky. 1986), a teacher, McCollum, called in sick and then drove a truck to deliver coal to a neighboring state. On his return, he filed a travel voucher upon which he wrote “ ‘sick all day’ ” for the day in question. 721 S.W.2d at 704. He later swore in a notarized affidavit that he was unable to teach that day because of illness. Although he subsequently tried to correct his error, the court upheld his dismissal for conduct unbecoming a teacher which “demonstrates a complete disregard of trust and basic honesty.” 721 S.W.2d at 705.
Although Gaylord had not sworn in an affidavit as McCollum had, he nevertheless was less than honest about his absence. The facts show Gaylord attempted to take, and was twice denied, a personal day during a time specifically prohibited by the negotiated agreement. Failing to secure permission, he had his wife call and report his illness on the day in question. He then drove to Texas to interview for a job and, upon his return, filled out an absence sheet claiming illness as the reason for his absence. Under the application of the community standards test articulated in Ware, substantial evidence exists to support the finding of insubordination warranting dismissal.
Gaylord’s argument that Fowler could have granted his personal leave and that it was granted to other school employees is without merit. The granting of leave is discretionary. In addition, those persons granted leave were not similarly situated. One had been nonrenewed for the coming year, and the other was not a classroom teacher. Neither individual surreptitiously took the day off and then tried to pass it off as sick leave with pay. In fact, both had their pay deducted.
The Board acted within the scope of its authority, there was substantial evidence to support its findings, and there is no evidence that the Board acted fraudulently, arbitrarily, or capriciously. The decision of the district court is affirmed. | [
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Briscoe, J.:
Continental Construction Engineers (Continental) and Joseph J. Furman and Lawrence H. Furman, P.C., (Furman) appeal the district court’s decision that they were not entitled to mechanics’ liens against mortgaged property on which Mark Twain Kansas City'Bank (Bank) foreclosed. We affirm.
The facts in this case are not in dispute. In 1986, Kroh Brothers Development Co. (Kroh) executed two promissory notes to the Bank, secured by separate mortgages on the Krohs’ property. In anticipation of construction of a retail shopping area on the mortgaged property, the Krohs contracted with Furman for architectural and engineering services and with Continental for preliminary civil engineering work. According to its lien statement, Continental provided the following professional services relating to the Krohs’ property: (1) utility research; (2) preparation of a new road profile; (3) preparation of proposed utility location; (4) preparation of frontage road widening details; (5) review of project with waste water district; (6) preparation of proposed util ity relocations; (7) meeting with Kroh staff; (8) review of project with KCP&L; (9) meeting with staff; (10) earthwork quantity checks; (11) regrading pláns; and (12) finalizing sewer plan revisions. According to an affidavit by the Krohs’ project supervisor, the work performed by Continental enabled the Krohs to obtain a zoning change on the property. What this zoning change was is not clear from the record. According to its lien statement, Furman’s lien covers all “labor and material furnished, used, and consumed in preparing the drawings and specifications and coordinating the work on said site with the site engineer and also preparing the architectural and engineering drawings for the retail space,” including the following specific professional services: (1) preparation of drawings and specifications; (2) complete coordination of all trades; (3) finalization of topography recommendation; (4) redesign of front of building to conform with site plan approval; (5) redesign of foundation system; and (6) obtaining a variance with the Code Board of Appeals of Overland Park, Kansas. The record indicates this variance would allow construction of “the building” without smoke and heat venting. It is undisputed that the Bank was aware of the activities of both Continental and Furman.
Before any construction began, the Krohs went into bankruptcy. Neither Continental nor Furman had been paid. The Bank filed a petition to foreclose on the real estate mortgages and, soon thereafter, Continental and Furman filed mechanics’ liens. Continental intervened in the foreclosure action to foreclose on its mechanic’s lien. Furman filed a separate petition to foreclose on its mechanic’s lien, which was consolidated with the Bank’s foreclosure. The Bank filed a motion for summary judgment, contending the mechanics’ liens of Continental and Furman were invalid because the labor and services furnished were never utilized in the construction of any structure or any improvement upon the real estate. The court granted the Bank’s summary judgment motion, holding the professional services provided by Continental and Furman in preparation for construction were never used or consumed in any improvement of the real property within the meaning of K.S.A. 60-1101, citing Benner-Williams, Inc. v. Romine, 200 Kan. 483, 485, 437 P.2d 312 (1968). In Benner-Williams, the Supreme Court held: “In order for a me chanic’s lien for labor and materials to attach, such items must be used or consumed for the improvement of real property, and thus become part of the realty itself.” 200 Kan. at 485. The labor and materials at issue in Benner-Williams were evidenced by the completed remodeling of a house, principally the installation of carpeting and cabinets.
Summary judgment is proper when there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. The reviewing court must read the record in the light most favorable to the party opposing the motion. Danes v. St. David’s Episcopal Church, 242 Kan. 822, 830, 752 P.2d 653 (1988). However, the parties in this case agree there are no disputed material facts and that this case presents a purely legal question concerning the interpretation of 60-1101. Interpretation of a statute is a question of law, and it is the function of the court to interpret a statute to give it the effect intended by the legislature. Director of Taxation v. Kansas Krude Oil Reclaiming Co., 236 Kan. 450, 455, 691 P.2d 1303 (1984).
The sole issue presented is whether the architectural and engineering services provided by Continental and Furman constituted lienable labor resulting in an improvement to real property within the meaning of 60-1101 when construction was never commenced and there appeared no visible or physical manifestation of either Continental’s or Furman’s work on the property. This issue is an issue of first impression for the Kansas appellate courts.
Continental and Furman contend the district court erred in holding their respective mechanics’ liens invalid. They contend 60-1101 does not require a visible improvement to real property when the third-party mortgagee (the Bank) had actual notice of the expenditure of lienable labor, and where the value of the real property has been increased by the leinholders’ labor. Continental and Furman contend the value of the Krohs’ property was intrinsically increased by the zoning change and by the benefit to any potential buyer of knowing utility plans, road widening, grading, and zoning had already been addressed. Continental and Furman argue that any eventual buyer will utilize the services which each has performed. Therefore, if left uncompensated, the conferral of such benefits upon the property would result in unjust enrichment.
The Bank contends the liens are invalid because the labor and services furnished by Continental and Furman were never utilized in the construction of any structure or any improvement upon the property. The Bank agrees that the labor and services supplied by Continental and Furman were of assistance in obtaining a change of zoning and variances, but it disputes that these changes significantly benefited the property. The Bank contends the real estate was not intrinsically increased in value by the labor and services provided by Continental and Furmán. The Bank argues 60-1101 and case law from other jurisdictions support its contention that a mechanic’s lien extends only to real estate upon which a visible improvement is erected. See Gollehon, Schemmer, Etc. v. Fairway-Bettendorf, 268 N.W.2d 200 (Iowa 1978); Goebel v. National Exchangors, Inc., 88 Wis. 2d 596, 277 N.W.2d 755 (1979).
K.S.A. 60-1101 provides:
“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. The lien shall be preferred to all other liens or encumbrances which are subsequent to the commencement of the furnishing of such labor, equipment, material or supplies at the site of the property subject to the lien. When two or more such contracts are entered into applicable to the same improvement, the liens of all claimants shall be similarly preferred to the date of the earliest unsatisfied lien of any of them.”
Since mechanics’ liens are statutory liens, they can only be acquired in the manner and on the conditions prescribed in the statute. General Air Conditioning Corp. v. Stuewe, 156 Kan. 182, Syl. ¶ 2, 131 P.2d 638 (1942). Those claiming a mechanic’s lien have the burden of bringing themselves clearly within the provisions of the statute. Lentz Plumbing Co. v. Fee, 235 Kan. 266, 274, 679 P.2d 736 (1984). While courts give liberal construction to statutory provisions once a mechanic’s lien has attached (Lewis v. Wanamaker Baptist Church, 10 Kan. App. 2d 99, 100, 692 P.2d 397 [1984]), strict construction in the absence of equitable considerations is the rule when deciding whether a lien attaches (Goodyear Tire & Rubber Company v. Jones, 317 F. Supp. 1285, 1289 [D. Kan. 1968], aff'd 433 F. 2d 629 [10th Cir. 1970]).
The general theory of liens is that labor expendéd and materials supplied in the construction of an improvement add an actual value to the property. The property, therefore, may be properly bound as security for payment of labor which enhances its value. See Given v. Campbell, 127 Kan. 378, 380, 273 Pac. 442 (1929). A mechanic’s lien which has attached is good against any subsequent purchasers for value and without notice, even if no lien statement is filed until after the conveyance. The work itself constitutes notice to the world of the existence of the lien. Lenexa State Bank & Trust Co. v. Dixon, 221 Kan. 238, 241, 559 P.2d 776 (1977). Continental cites a number of cases from other jurisdictions in support of its contention that visible construction on the site is unnecessary to confer notice if-interested parties (here, the Bank) have actual notice of the labor. The cases cited, however, involve statutes which expressly provide for architects’ and engineers’ mechanics’ liens and include specifically or by implication off-site designs and drawings within their definition of “improvement.”
Lien statutes cannot be extended by implication bteyond the clear import of the language employed and their operation cannot be enlarged to include activities not specifically embraced. It is well settled that, where a statute is clear and unambiguous-, the court must give effect to the expressed legislative intent without regard to what the court thinks the law should or should not be. In re Tax Appeal of Bernie’s Excavating Co., 13 Kan. App. 2d 476, 479, 772 P.2d 822, rev. denied 245 Kan. 784 (1989).
. Neither party questions that the architectural and engineering work performed by Continental and Furman qualifies as “labor,” as contemplated by the use of that term in 60-1101. Numerous decisions now recognize that the term “labor”. as used in mechanic’s lien statutes is broad enough to in.clude mental or physical toil, bodily or intellectual exertion.. 51 C.J.S., Labor, p.. 544. The fact that someone has performed labor is not in . itself sufficient to give rise to an enforceable lien under 60-1101. The labor must also be “used or consumed for the improvement of .real property.” The statute also refers to the furnishing of labor “at the site of the property."
Our decision in the present case turns upon our interpretation of “improvement” as contained in 60-1101. We do not address the more troublesome issues of whether a mechanic’s lien can attach for off-site architectural and engineering services if construction is commenced and, if a lien can attach, what priority it would be given as against other liens.
The plain language of the mechanic’s lien statute supports the Bank’s contention that Continental and Furman are not entitled to mechanics’ liens when no visible construction was ever commenced on the Krohs’ property. As previously stated, 60-1101 requires that the labor and materials must be “used or consumed for the improvement of real property.” In Seyb-Tucker Lumber and Implement Co. v. Hartley, 197 Kan. 58, 62-63, 415 P.2d 217 (1966), the court addressed whether delivery of materials to a building site was sufficient to sustain a mechanic’s lien under 60-1101. The court held mere delivery was insufficient. The materials had to be actually used in the construction of the building in order to sustain a mechanic’s lien. K.S.A. 60-1101 should be given the same interpretation when determining whether a mechanic’s lien attaches as a result of the labor expended by Continental and Furman.
The rationale for allowing a lien is to afford effective security to persons designated in the statute who have done acts described in the statute. The requirement of visible activity on the site serves to put the world on notice of the rights of those who furnish labor or materials for the improvement. When no construction begins, no visible evidence of possible liens exists. Although the Bank in this case had knowledge of the services provided by Continental and Furman, their services did not result in an “improvement” to the property as contemplated by the mechanic’s lien statute.
Although 60-1101 does not define “improvement,” it is generally defined as any physical addition made to real property that enhances the value of the land. See Stickney v. Murdock Steel & Engineering, Inc., 212 Kan. 653, 656, 512 P.2d 339 (1973); Benner-Williams, Inc. v. Romine, 200 Kan. at 485; Southwestern Electrical Co. v. Hughes, 139 Kan. 89, 93, 30 P.2d 114 (1934); Hill v. Bowers, 45 Kan. 592, 593, 26 Pac. 13 (1891). Here, neither Continental’s nor Furman’s plans and drawings have resulted in any physical improvement or development on the Krohs’ property. Some visible improvement must be made in order to put those who seek to acquire an interest in the land on notice that building has commenced on the property. See Mortgage Co. v. Weyerhaeuser, 48 Kan. 335, 343, 29 Pac. 153 (1892). To allow a lien to attach where there is no visible effect on the real estate is contrary to the reason mechanics’ liens are given priority over other liens that are subsequent to the commencement of the work improving the property. See K.S.A. 60-1101. To allow a lien where the property was not visibly improved by the labor provided would require an amendment to the present mechanic’s lien statute. See Torkko/Korman/Engineers v. Penland Ventures, 673 P.2d 769 (Alaska 1983).
Both Continental and Furman rely extensively on DaMac Drilling, Inc. v. Shoemake, 11 Kan. App. 2d 38, 713 P.2d 480 (1986), a case involving oil and gas liens under K.S.A. 55-207, a statute similar to the mechanic’s lien statute. DaMac is not compelling authority because it applies a different statute than the statute at issue in the present case and is also factually distinguishable.
First, as an oil and gas lien case under 55-207, DaMac is of limited value in determining the applicability of the mechanic’s lien statute, K.S.A. 60-1101. Second, DaMac focuses on the definition of “labor” under 55-207 and whether on-site services provided by a geologist fall within that definition. The issue in the instant case is not whether the services provided by Continental and Furman constituted “labor,” but rather whether those services resulted in “the improvement of real property.”
Finally, to the extent DaMac addresses the issue of improvement of property, it is clear that the improvement involved is factually distinguishable from the improvement claimed by Continental and Furman. In DaMac, the services were provided on-site and were in actual aid of the drilling work and were labor performed in completing an oil or gas well. 11 Kan. App. 2d at 44. Thus, the services in DaMac were part of an actual physical improvement on the property. In DaMac, this court adopted the following definition of “labor” under the relevant statute: “Work performed in the on-site advancement of the construction, repair or operation of an oil or gas well.” 11 Kan. App. 2d at 46. Contrary to the DaMac case, the services performed by Continental and Furman were not in conjunction with any actual physical improvements on the property. They did not accompany any actual physical construction or repair.
Moreover, DaMac notes that the services must be of a type “which improves the property in a manner which would be apparent to third-party purchasers so that they would be put on notice that lienable claims may be outstanding.” 11 Kan. App. 2d at 45-46. Continental and Furman suggest that, because the Bank had actual notice of services performed, this notice requirement is met. However, it is clear that the emphasis in DaMac is not whether a third party had actual notice, but rather whether the services constitute “observable work on the property” to all third parties. 11 Kan. App. 2d at 46. Unlike the services in DaMac, the services here were not “observable work on the property. ”
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Gernon, J.:
Following an adverse jury verdict, the State of Kansas appeals from the trial court’s denial of its motions for summary judgment and dismissal. We affirm.
This case was filed as a damage action against the State of Kansas and the Kansas Department of Revenue. A trial resulted in ‘a jury verdict in favor of the plaintiff, Kenneth D. Griffin, against the State of Kansas. The jury assessed total damages of $7,000 and apportioned fault as follows: Griffin, 20%; Officer Rivera, 15%; and the State of Kansas, 65%.
The facts are not in dispute. In April of 1988, there were at least two individuals named Kenneth D. Griffin residing in the State of Kansas, each possessing a valid Kansas driver’s license. One Kenneth D. Griffin resided in Junction City, and the other resided in Penokee.
The Kenneth D. Griffin living in Penokee had been convicted of driving on a suspended license in February of 1987. In that same month, the Division of Vehicles sent a notice to him stating that his driver’s license would be suspended unless his insurance company provided proof of insurance. The notice erroneously listed his driver’s license number as Q4J1V5. Unfortunately for the Kenneth D. Griffin living in Junction City, this was his license number.
In April of 1988, the Kenneth D. Griffin living in Junction City was stopped for speeding. The officer who stopped him, Nelson Rivera, ran a computer check on license number Q4J1V5, which indicated that the license was suspended. Based upon this information, Rivera arrested Griffin. Griffin was charged with driving on a suspended license in violation of a municipal ordinance of the City of Junction City.
The Department of Revenue had mistakenly suspended the license of the Griffin living in Junction City based upon information received concerning the individual named Griffin living in Penokee. The pretrial order in this case states, “[Defendants stipulate to the following: A. the Division of Vehicles of the Kansas Department of Revenue, in suspending the driver’s license of a Kenneth D. Griffin residing in Penokee, Kansas, placed the ‘sus pension’ notation in its central computer file under the plaintiffs name [Kenneth D. Griffin of Junction City, Kansas].”
The charge against Mr. Griffin of Junction City was dismissed by motion of the city attorney. The Driver Control Bureau action and the entry thereon suspending his license was eventually “deleted.”
Griffin filed a civil action against the Kansas Department of Revenue and the State of Kansas. Essentially, Griffin alleged .hat the Kansas Department of Revenue was negligent and that he had suffered humiliation, embarrassment, emotional distress, and loss of reputation. He also alleged that, as a result of information provided by the State of Kansas, he was arrested falsely.
The defendants filed various pretrial motions, including a motion for summary judgment, a motion for partial summary judgment, and a “partial motion to dismiss.” The motion for summary judgment argued that the defendants were immune from suit under K.S.A. 75-61040) (Ensley 1984), now K.S.A. 75-6104(k) (Ensley 1989), the inspection exception to the Kansas Tort Claims Act. The motion for partial summary judgment argued that Officer Rivera lacked statutory authority to arrest Griffin for driving on a suspended license and, therefore, the defendants could not be held liable based upon Rivera’s actions. The partial motion to dismiss contended that “mental damages” were not recoverable in the action.
Upon hearing the motions, the court dismissed the Kansas Department of Revenue from the case and dismissed the cause of action based upon false arrest. The remaining motions filed by defendants were denied, and the State of Kansas was left as the sole defendant.
The trial court allowed the case to proceed to trial on the negligence issue alone with the result as previously noted.
The State of Kansas raises three issues on appeal:
(1) The trial court erred in denying the State’s motion for summary judgment based upon the inspection exception to the Kansas Tort Claims Act;
(2) the court erred by denying the State’s motion to dismiss the claims for “mental damages;” and
(3) the court erred by denying the State’s motion for partial summary judgment of the damages resulting from the alleged illegal arrest of Griffin.
KANSAS TORT CLAIMS — INSPECTION EXCEPTION
K.S.A. 75-6104 provides in part:
“A governmental entity or an employee acting within the scope of the employee’s employment shall not be liable for damages resulting from:
“(k) the failure to make an inspection, or making an inadequate or negligent inspection, of any property other than the property of the governmental entity, to determine whether the property complies with or violates any law or regulation or contains a hazard to public health or safety.”
The State argued that its only negligence, if any, was inadequately inspecting the notice of a conviction it received concerning Kenneth D. Griffin of Penokee. Griffin’s response to this argument states: “The error was not in the inspection of the arrest record but in the preparation of the defendant’s order of suspension.” The trial court rejected the State’s interpretation of the statute, concluding that “the defendant in this motion is placing a very strained and inappropriate construction on the term inspection.” We agree with the trial judge.
The interpretation of a statute is a question of law. Director of Taxation v. Kansas Krude Oil Reclaiming Co., 236 Kan. 450, 455, 691 P.2d 1303 (1984). Appellate review of questions of law is unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
The rules of statutory construction are well settled and include:
“The fundamental rule of statutory construction is that the purpose and intent of the legislature governs when the intent can be ascertained from the statute. . . . Effect must be given, if possible, to the entire act and every part thereof. To this end, it is the duty of the court, as far as practicable, to reconcile the different provisions so as to make them consistent, harmonious, and sensible. [Citations omitted.] ... A construction which renders part of a legislative act surplusage is to be avoided if reasonably possible.” State v. Adee, 241 Kan. 825, 829, 740 P.2d 611 (1987).
“The Kansas Tort Claims Act is an open-ended act making governmental liability the rule and immunity the exception.” Nichols v. U.S.D. No. 400, 246 Kan. 93, 94, 785 P.2d 986 (1990).
K.S.A. 75-6103(a) provides:
“Subject to the limitations of this act, each governmental entity shall be liable for damages caused by the negligent or wrongful act or omission of any of its employees while acting within the scope of their employment under circumstances where the governmental entity, if a private person, would be liable under the laws of this state.”
The Kansas Supreme Court has considered the meaning of the inspection exception to the Kansas Tort Claims Act. In Siple v. City of Topeka, 235 Kan. 167, 172, 679 P.2d 190 (1984), the court announced the following definition of “inspection” under the Act: “Inspection as used in K.S.A. 1983 Supp. 75-6104(j) means investigation, or examination for the purpose of determining whether any property other than property of a governmental entity complies with or violates any law or regulation of the governmental entity or constitutes a hazard to public health or safety.”
The court concluded that a visual examination of a tree by a City Forestry Department employee was within the exception, where a tree limb fell on the plaintiffs car during a subsequent storm. 235 Kan. at 168, 173. As other examples of inspections covered by the provision, the court mentioned building inspections, working conditions of apprentices and minors, and inspection of apiaries for disease detection and control. 235 Kan. at 172. The court also explained:
“Inspection laws are regulations designed to safeguard the public against fraud, injury and to promote the public health, safety and welfare. They provide for the examination or inspection of property by an authorized public official. The public official is to examine and determine whether the standards prescribed by the regulations are complied with.” 235 Kan. at 170-71.
We agree with the trial court’s conclusion concerning how this statute ought to be construed. The language of the provision indicates the legislature did not create immunity for all inspections or all governmental actions that arguably result from an inspection function. By its own terms, K.S.A. 75-6104(k) only exempts inspections of property which are for the purpose of determining compliance with a law or for assessing a hazard to public health or safety.
The inspection in this case was not conducted to determine whether the property in question, a notice of conviction, complied with the law or presented a hazard to the public. Rather, the abstract was examined to determine if the license, of Kenneth D. Griffin of Penokee was subject to administrative action.
We conclude that the injury to Griffin did not result from an inspection within the meaning of K.S.A. 75-6104(k).
CLAIM FOR MENTAL DAMAGES
The State argues that the trial court erred by denying its motion to dismiss the claim for “mental damages.” Both sides rely upon the Kansas Supreme Court decision in Bowman v. Doherty, 235 Kan. 870, 686 P.2d 112 (1984). The State argues that the Bowman decision only authorizes recovery of mental distress damages in cases of wanton conduct. Griffin’s position is that the State has misread Bowman and, therefore, “seriously [misled] the court as to the holding.” Griffin’s position is that a deprivation of freedom itself constitutes a type of physical injury.
In Bowman, the court reversed the trial court’s entry of partial summary judgment on a claim for mental distress damages. In Bowman, the plaintiff was arrested after his attorney failed to seek or obtain a continuance in a criminal case. Syllabus ¶ 3 of Botvman states, “One being negligently deprived of his freedom suffers an injury which could cause mental distress.”
The State’s analysis of Bowman also tends to ignore the language contained in Syllabus ¶ 4 and elsewhere in the decision which states: “Whether a client was injured and suffered mental distress when deprived of his freedom because his attorney failed to act or acted in a wanton manner is a matter of fact for the jury to determine.” 235 Kan. at 878.
Recovery of mental distress damages on a claim of false arrest or imprisonment has been recognized in this state for many years. Lonergan v. Small, 81 Kan. 48, 51, 105 Pac. 27 (1909); Zimmerman v. Knox, 34 Kan. 245, 253, 8 Pac. 104 (1885).
We conclude that the decision in Bowman controls the present case. Bowman essentially holds that a private individual may be liable for mental distress resulting from negligence that causes the false arrest of another person. 235 Kan. at 877. Under the Kansas Tort Claims Act, the State of Kansas is liable for damages if a private person would be liable under the same circumstances. K.S.A. 75-6103(a). We agree with.the ruling of the trial court which denied the State’s motion to dismiss the claim for damages based upon mental distress.
PARTIAL SUMMARY JUDGMENT MOTION FOR ILLEGAL ARREST DAMAGES
The State moved for partial summary judgment, maintaining that the arrest made by Officer Rivera was illegal. The State avows that the arrest was not authorized by K.S.A. 1989 Supp. 12-4212. The State further asserts that K.S.A. 22-2401 is either inapplicable or, if it is applicable, it did not authorize the arrest in this case.
The court ruled that “Officer Rivera acted within the scope of his . . . duties and authority. ” Rivera’s negligence was compared by the jury.
K.S.A. 22-2401 states in relevant part: “A law enforcement officer may arrest a person under any of the following circumstances: . . . . (d) Any crime, except a traffic infraction, has been or is being committed by the person in the officer’s view.”
The State argues K.S.A. 22-2401 lacks any language indicating it is applicable to municipal law enforcement officers. However, municipal police are included in the Chapter 22 definition of “law enforcement officer.” K.S.A. 1989 Supp. 22-2202(13) provides in part:
“ ‘Law enforcement officer’ means any person who by virtue of office or public employment is vested by law with a duty to maintain public order or to make arrests for violation of the laws of the state of Kansas or ordinances of any municipality thereof or with a duty to maintain or assert custody or supervision over persons accused or convicted of crime . . . .”
Both sides agree that driving on a suspended license in violation of a municipal ordinance does not constitute a traffic infraction under the terms of K.S.A. 1989 Supp. 8-2116 and K.S.A. 1989 Supp. 8-2118.
The State’s argument seems to focus on excepted parts of statutes, while rejecting others, or reading the statutes together.
For example, the State contends that the language of K.S.A. 22-2102 limits the scope of authority in this case. K.S.A. 22-2102 states: “The provisions of this code shall govern proceedings in all criminal cases in the courts of the state of Kansas, but shall have application to proceedings in police and municipal courts only when specifically provided by law.”
The State argues that K.S.A. 22-2102 is an “applicability” statute which must be satisfied before the definitions in K.S.A. 22-2202 ought to be considered. We conclude the State’s argument is flawed for several reasons.
First, the State’s position is contrary to the express language of K.S.A. 22-2201(1), which provides: “In interpreting this code, such words and phrases as are defined in this article shall be given the meanings indicated by their definitions, unless a particular context clearly requires a different meaning.”
Second, the State’s position is contrary to the rules of statutory construction. This court must look to ascertain legislative intent and read the entire act to determine if the act and its parts are consistent, harmonious, and sensible. State v. Adee, 241 Kan. at 829.
In addition, the State’s position ignores K.S.A. 12-4111, which indicates that various portions of Chapter 22 are applicable to municipal court officers. K.S.A. 12-4111 states in part: “The powers of law enforcement officers with respect to the code of criminal procedure shall not be reduced by this code.”
We also reject the State’s argument that K.S.A. 1989 Supp. 12-4212 provides the' exclusive arresting authority for municipal police. This statute contains no language of exclusivity.
In addition, the available case law authority supports the conclusion that K.S.A. 22-2401 is applicable to municipal police officers. In City of Bonner Springs v. Bey, 236 Kan. 661, 694 P.2d 477 (1985), the Kansas Supreme Court considered the validity of an arrest by a municipal police officer based upon information from another Kansas law enforcement agency concerning an outstanding warrant. The statutory provisions which potentially authorized the arrest were K.S.A. 12-4212(b) and K.S.A. 22-2401(b). In upholding the validity of the arrest, the court concluded:
“The prosecution must merely prove the police officer determined a warrant for the individual's arrest had been issued by a municipal court in this state, pursuant to K.S.A. 12-4212, or that the officer had probable cause to believe a warrant for the individual’s arrest had been issued in this state or in another jurisdiction for a felony committed therein, pursuant to K.S.A. 22-2401(b).” 236 Kan. at 662-63.
In determining the validity of an arrest by a municipal police officer, this court has also applied the provisions of K.S.A. 22- 2401. State v. Latimer, 9 Kan. App. 2d 728, 730, 687 P.2d 648 (1984). It should be noted that the decisions in Bey and Latimer do not indicate any direct challenge to the applicability of K.S.A. 22-2401 by the defendant in those cases.
The State next alleges that the arrest was not valid because the offense of driving on a suspended license was not committed “in the officer’s view,” as required by K.S.A. 22-2401(d).
This court has held: “[T]he validity of a warrantless arrest depends upon whether, at the moment the arrest was made, the officer had probable cause to make it.” State v. Press, 9 Kan. App. 2d 589, 592, 685 P.2d 887, rev. denied 236 Kan. 877 (1984).
The Kansas Supreme Court, in State v. Merrifield, 180 Kan. 267, 269-70, 303 P.2d 155 (1956), approved an arrest for driving on a suspended license where the sheriff saw the defendant driving and had prior knowledge that his license was suspended.
It is impossible to “view” a suspension in the abstraction. What can be viewed is an order suspending the license or a license which has been suspended. Logic demands that we recognize the reasonableness of interpreting “in the officer’s view” in driving-while-suspended cases to mean that the officer viewed the person, whose license has been suspended, driving.
The State’s position would result in a position where a person could only be arrested for driving on a suspended license in violation of a municipal ordinance if the officer had probable cause to believe evidence would be lost or the person could not be apprehended at a later time. K.S.A. 22-2401(c)(2)(A).
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Briscoe, J.:
Wal-Mart Stores, Inc., (Wal-Mart) and its insurance carriers appeal the amount of attorney fees awarded in a workers’ compensation case. At issue is the construction of K.S.A. 1988 Supp. 44-512a(b) as it pertains to the awarding of attorney fees by the district court for collection of past due compensation.
In 1983, Diene Hatfield was injured while working at WalMart. Her initial temporary total disability award was increased in 1986 to include permanent total disability. Diene is now a permanent resident of the Medicalodge nursing home in Coffey-ville. Wal-Mart’s failure to pay bills covered by the award as they came due became a recurring problem. In a follow-up order on January 20, 1987, the administrative law judge found the medical expenses incurred by Diene at Medicalodge were reasonable and necessary and ordered Wal-Mart to pay Medicalodge $5,567 “for care rendered to claimant [Diene] from October 1, 1986 to February 1, 1987, and continue such care as prescribed by Dr. Sandhu [Diene’s treating physician].” (This statement has been interpreted by the parties and the district court as a direction from the ALJ that Wal-Mart continue to pay the medical expenses as they are incurred by Diene at Medicalodge.) The ALJ also ordered Wal-Mart to reimburse Diene’s guardian the sum of $1,149.51 for reasonable and necessary medical expenses paid by him and ordered that Wal-Mart pay the sum of $105 to Four County Mental Health.
When no payments were made, the guardian sent a demand for compensation on May 8, 1987. No payments were made within 20 days of the letter. The guardian then filed a motion for civil penalties on July 13, 1987. On November 10, 1987, the ALJ found there were eight medical bills totalling $9,383.68, which were past due without payment for more than 20 days subsequent to the service of the statutory written demand letter, and therefore assessed civil penalties of $200. The ALJ denied civil penalties on unpaid medical bills omitted from the demand letter.
On August 10, 1987, Wal-Mart paid Four County Mental Health and the guardian two of the past due bills addressed in the ALJ’s order. The guardian received no other payments and, on December 28, 1987, he filed a petition in district court pursuant to 44-512a(b) to collect $13,701.73 for outstanding and un paid medical expenses, $200 for unpaid civil penalties, and in excess of $10,000 for attorney fees. Wal-Mart paid the $200 for civil penalties and $10,441.18 to Medicalodge by checks dated December 23, 1987. It was stipulated at trial that these checks were not received prior to the filing of the petition.
The sole issue at the trial on October 28, 1988, was the amount of attorney fees to be awarded the guardian. The parties agreed the guardian was entitled to reasonable attorney fees under 44-512a(b), but they disagreed as to what amount would be reasonable.
The district court found that slightly more than $30,000 had been paid by Wal-Mart since the filing of the action in district court. The court found Wal-Mart had paid all medical expenses which were due at the date of filing and also had paid expenses incurred after the date of filing, although most of these payments were late. The district court found $13,815.87 in bills incurred in 1987 had been paid and ordered a 50 percent contingent fee of that amount. The court found $17,729.68 in bills incurred in 1988 also had been paid and ordered a 33V3 percent contingent fee on that amount, less $7,519.22 which Wal-Mart had timely paid. The attorney fees awarded totalled $10,311.42 (one-half X $13,815.87 + one-third x [$17,729.68 - $7,519.22] = $10,311.42).
Wal-Mart contends the district court erred in awarding attorney fees based upon medical bills which were not first determined by the director of workers’ compensation to be past due and subject to the enforcement provisions of 44-512a. Specifically, Wal-Mart argues the district court’s authority to enforce collection was limited to the amounts set forth in the ALJ’s order of November 10, 1987, which remained unpaid. The guardian contends the district court could consider all medical bills which were paid by Wal-Mart after the filing of his petition. Some were past due at the time the petition was filed; others became due after it was filed. The guardian relies upon the ALJ’s order of January 20, 1987, for authority that WalMart had a continuing duty to pay these bills whether they came due before or . after the filing of the petition.
The resolution of this dispute centers around the interpretation of K.S.A. 1988 Supp. 44-512a, which provides in part:
“(a) In the event any compensation, including medical compensation, which has been awarded under the workers’ compensation act, is not paid when due to the person, firm or corporation entitled thereto, the employee shall be entitled to a civil penalty, to be set by the director and assessed against the employer or insurance carrier liable for such compensation in an amount of not more than $100 per week for each week any disability compensation is past due and in the sum of $25 for each past due medical bill, if: (1) Service of written demand for payment, setting forth with particularity the items of disability and medical compensation claimed to be unpaid and past due, has been made personally or by registered mail on the employer or insurance carrier liable for such compensation and its attorney of record; and (2) payment of such demand is thereafter refused or is not made within 20 days from the date of service of such demand.
“(b) After the service of such written demand, if the payment of disability compensation or medical compensation set forth in the written demand is not made within 20 days from the date of service of such written demand, plus any civil penalty, as provided in subsection (a), if such compensation was in fact past due, then all past due compensation and any such penalties shall become immediately due and payable. Service of written demand shall be required only once after the final award. Subsequent failures to pay compensation, including medical compensation, shall entitle the employee to apply for the civil penalty without demand. The employee may maintain an action in the district court of the county where the cause of action arose for the collection of such past due disability compensation and medical compensation, any civil penalties due under this section and reasonable attorney fees incurred in connection with the action." (Emphasis added.)
As stated in Lackey v. D & M Trucking, 9 Kan. App. 2d 679, 681, 687 P.2d 23 (1984), the following general rules apply to the construction of the Workers Compensation Act:
“ ‘[T]his court has been firmly committed to the rule of liberal construction of the act in order to award compensation to the workman where it is reasonably possible to do so, and to make the legislative intent effective and not to nullify it. [Citations omitted.] ....
“ \ . . Legislative intent is to be determined by a general consideration of the entire act. Effect should be given, if possible, to the entire statute and every part thereof. To this end it is the duty of the court, so far as practicable, to reconcile the different provisions so as to make them consistent, harmonious and sensible. [Citation omitted.] Where a statute is plain and unambiguous, this court must give effect to the intention of the legislature as expressed rather than determine what the law should or should not be. [Citation omitted.] Where various provisions of an act conflict, this court should attempt to reconcile such provisions in order to make them harmonious and sensible. [Citations omitted.]’ ”
The overriding purpose of the Workers Compensation Act is to secure prompt payment to injured employees of the benefits provided for under its terms. Zimmerman v. O’Neill Tank Co., 188 Kan. 306, 309-10, 362 P.2d 10 (1961). The means selected by the legislature to insure prompt payment of compensation awards is found in 44-512a. Hallmark v. Dalton Construction Co., 206 Kan. 159, 163, 476 P.2d 221 (1970). K.S.A. 1988 Supp. 44-512a enumerates a series of procedural steps which must be followed in enforcing a compensation award. A demand letter specifying the past due disability and medical compensation must be served on the employer. Failure of the employer to timely comply with the demand letter entitles the employee to civil penalties and authorizes the employee to commence an action in the district court for “such” past due compensation. K.S.A. 1988 Supp. 44-512a(b) authorizes an award of reasonable attorney fees in connection with the action. The “action” referred to in 44-512a(b) relates to the district court action authorized by the statute to enforce the collection of past due compensation which remains unpaid after demand and imposition of penalties, or after imposition of penalties if a prior demand was made. See Crow v. City of Wichita, 222 Kan. 322, 566 P.2d 1 (1977). See also Atlantic Coast Line v. Riverside Mills, 219 U.S. 9 186, 55 L. Ed. 167, 31 S. Ct. 164 (1911) (statute mandating attorney fees in certain proceedings upon defined claims is strictly limited to the proceedings and claims described in the statute).
As a result of amendments enacted in 1974, 44-512a no longer contemplates acceleration of the entire compensation award. As stated in Crow v. City of Wichita, 222 Kan. at 328-29:
“Under the former law, failure by the employer to pay compensation when due, as provided in the act, caused ‘the entire amount of compensation awarded, agreed upon or adjudged’ to become immediately due and payable. In place of acceleration of the entire award, the new act [1974 amendment] causes only past due compensation to become immediately due and payable and provides for certain civil penalties to be assessed by the director against the employer. The new act also provides for the allowance of reasonable attorneys’ fees incurred in connection with a 44-512a action.”
Therefore, an action in district court can only be effective for past due compensation. In order to determine whether the fee awarded in this case was reasonable, we must determine what amounts are included in the computation of amounts “past due” which were subject to the collection action.
As a result of a 1987 amendment to 44-512a(b), the statute no longer requires the claimant to serve successive demand letters upon subsequent failures to pay compensation. “Subsequent failures to pay compensation, including medical compensation, shall entitle the employee to apply for the civil penalty without demand.” K.S.A. 1988 Supp. 44-512a(b). However, the claimant must apply for civil penalties as a prerequisite for maintaining an action in district court for the collection of past due compensation. See Hall v. City of Hugoton, 2 Kan. App. 2d 728, 730, 587 P.2d 927 (1978).
In the present case, the guardian served a demand letter on Wal-Mart on May 8, 1987. Wal-Mart failed to comply with the demand letter and the guardian filed a motion for civil penalties.
An award of attorney fees pursuant to K.S.A. 1988 Supp. 44-512a(b) can only be related to the enforcement of the collection of compensation determined to be past due by the director after assessing civil penalties on those amounts. The reasonableness of the award for attorney fees must be viewed in light of that collection. K.S.A. 1988 Supp. 44-512a(b). Here, the district court erred in awarding attorney fees based on medical bills which were not first determined by the director to be past due and payable. The award for attorney fees should have been related to the total past due medical compensation outstanding on November 10, 1987, upon which civil penalties were assessed.
Wal-Mart contends the district court erred in computing the award for attorney fees on a contingent fee basis. Noting that medical expenses are specifically excluded from the calculation of contingent fees with respect to the original claim (K.S.A. 1988 Supp. 44-536[c]), Wal-Mart argues it is illogical to allow such an award indirectly through a 44-512a(b) action. Additionally, WalMart contends contingent fees are only appropriate when based upon a contract between the attorney and client.
Generally, the award of attorney fees is a matter within the trial court’s discretion and is upheld unless there is a showing of an abuse of discretion. Dickinson, Inc. v. Balcor Income Properties Ltd., 12 Kan. App. 2d 395, 401, 745 P.2d 1120 (1987), rev. denied 242 Kan. 902 (1988). Because of the discretionary nature of fee determinations, fee awards that fall within a zone of reasonableness will not be disturbed on appeal. As a general rule, appellate courts defer to any thoughtful rationale and decision developed by a trial court and avoid second guessing. Grendel’s Den, Inc. v. Larkin, 749 F.2d 945, 950 (1st Cir. 1984). However, these discretionary decisions are limited by the evidence in the record and, when an abuse of discretion is shown, appellate courts may, in the interest of justice, amend the attorney fee award. See Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 716-17 (5th Cir. 1974); Buchanan v. Employers Mutual Liability Ins. Co., 201 Kan. 666, 676, 443 P.2d 681 (1968).
Statutory attorney fee awards serve to deter potential violators and encourage voluntary compliance with the statute involved. See Johnson v. Georgia Highway Express, Inc., 488 F.2d at 716. Statutes allowing an award of attorney fees are not passed to benefit the attorney. Rather, they are passed to enable litigants to obtain competent counsel. Grendel’s Den, Inc. v. Larkin, 749 F.2d at 950; Johnson v. Georgia Highway Express, Inc., 488 F.2d at 719.
As a general rule, general and special statutes should be read together and harmonized whenever possible to avoid conflict. It is our duty to reconcile the different statutory provisions so as to make them consistent, harmonious, and sensible. Kansas Racing Management, Inc. v. Kansas Racing Comm’n, 244 Kan. 343, 353, 770 P.2d 423 (1989). K.S.A. 1988 Supp. 44-512a(b) provides for an award of reasonable attorney fees. It does not, however, enumerate the factors to be considered in determining such an award or state whether fees can be awarded on a contingent fee basis. K.S.A. 1988 Supp. 44-536(g), the general provision for attorney fees in the Workers Compensation Act, states that attorney fee awards for any service subsequent to the ultimate disposition of the original claim are based on the reasonable and customary charges in the locality, and not on a contingent fee basis. In order to reconcile 44-512a and 44-536, a contingent fee is not recoverable in a 44-512a action. To be consistent with the entire Act, the appropriate basis for an attorney fee award must be the reasonable hours expended on the action multiplied by the reasonable hourly rate. Adjustments to the basic rate can then be made to reflect various nonpecuniary factors which are enumerated in 44-536(b).
The evidence in the record discloses the guardian’s counsel expended approximately 14 hours on this action. The customary standard rate in the community is $75 per hour. Thus, the basic attorney fee award should be $1,050. The trial court’s award exceeded $10,000 and must be justified, if possible, by consideration of other factors such as the novelty and complexity of the issues, employment preclusion, and the results obtained. See K.S.A. 1988 Supp. 44-536(b); Dickinson, Inc. v. Balcor Income Properties Ltd., 12 Kan. App. 2d at 401-02.
The reasons offered by the district court to support the attorney fee award do not withstand examination. The district court found it took extraordinary efforts to collect the medical compensation expenses incurred in 1987. The record discloses the attorney’s actions in connection with the 44-512a action consisted of filing a petition in district court and preparing for a hearing in which the only remaining issue was the amount of attorney fees to be awarded. Filing the petition resulted in the payment of $8,129.17 in medical compensation declared past due by the director which remained unpaid plus the $200 in civil penalties. While it is conceivable that the filing also resulted in payment of medical bills which became due and payable later, those figures are irrelevant to the determination of the present attorney fee award because they had not been determined past due by the director. In short, it has not been shown that the results were exceptional or required extraordinary legal skills. In fact, the guardian’s attorney admitted the issues were not complex.
Obviously, where a plaintiff has obtained excellent results, his attorney should recover a full compensatory fee. Generally, this will encompass all hours reasonably expended on the action and, indeed, in some cases of exceptional success, an enhanced award may be justified. In the present case, the district court in the exercise of its discretion could have allowed some enhancement for the excellent results obtained; however, a fee award totalling $10,311.42 for the collection of $8,329.17 does not fall within a zone of reasonableness under the facts of this case.
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Elliott, J.:
Farm Bureau Mutual Insurance Company, Inc., (Farm Bureau) brings an interlocutory appeal from the trial court’s ruling that plaintiff Roger Shumaker (Shumaker) was entitled to uninsured motorist and personal injury protection (PIP) benefits for injuries sustained while a passenger in an uninsured dune buggy.
We reverse.
Plaintiff was injured while a passenger in a dune buggy owned and operated by Keith Weckworth; the accident occurred “off road” on private property. The dune buggy had no doors, sides, or top, but was equipped with roll bars, head and tail lights, brakes, seat belts, and ordinary street tires. It did not have brake lights, turn signals, a windshield, an odometer, a speedometer, a horn, a hood, or a gas gauge. The dune buggy was neither licensed nor registered as an automobile or highway vehicle. And, of course, Weckworth had no insurance on the dune buggy.
On the day of the accident, Weckworth drove the dune buggy from his house to a private, off-road pasture. To get there, he drove a short distance (about three blocks) on a public roadway. He had followed this route before. Weckworth never drove the buggy to work and never used it for any purpose other than off-road recreation.
Initially, plaintiff wanted Weckworth to say the accident occurred on his own land so a claim could be made against Week-worth’s homeowner’s policy. The idea was rejected, and, instead, plaintiff filed the present claim against his own automobile carrier.
With respect to PIP benefits, plaintiffs policy covered bodily injury resulting from the use of a motor vehicle, defined as a land motor vehicle of a kind required to be registered. The uninsured motorist portion of plaintiffs policy defined uninsured vehicle to exclude any vehicle “designed mainly for use off public roads while not upon public roads.”
On cross-motions for summary judgment, the trial court ruled that the dune buggy was a “motor vehicle” and that plaintiff was entitled to PIP benefits and uninsured motorist coverage under his Farm Bureau policy.
The present appeal squarely presents the question left unanswered in Kresyman v. State Farm Mut. Auto. Ins. Co., 5 Kan. App. 2d 666, 623 P.2d 524, rev. denied 229 Kan. 670 (1981), where we held that a “mini-bike,” while being operated on a public highway, was a vehicle with respect to which insurance was required. 5 Kan. App. 2d at 669.
We also stated:
“We caution that our decision must not be read too broadly. In this case, the accident occurred at a time when the mini-bike was operated on a public highway and the extent of our holding is that at that time it was a motor vehicle with respect to which a motor vehicle liability insurance policy was statutorily required.” 5 Kan. App. 2d at 669. (Emphasis added.)
Farm Bureau relies heavily on Kansas Farm Bureau Ins. Co. v. Cool, 205 Kan. 567, 471 P.2d 352 (1970), which is factually very similar to the present case, but which was decided prior to the adoption of the Kansas Automobile Injury Reparations Act, K.S.A. 40-3101 et seq.
Plaintiff Shumaker, on the other hand, argues that the dune buggy is a motor vehicle because K.S.A. 8-126 defines a vehicle as any device in which a person is or may be transported on a public roadway. And, goes plaintiffs argument, because a person — namely plaintiff — may be transported on a public roadway in Weckworth’s dune buggy (and in fact, was for a short distance), the dune buggy is a motor vehicle requiring PIP and uninsured motorist coverage for the off-road accident.
The Kansas statute, 8-126, defining vehicle as a device in which a person is or may be transported on a public highway, is similar to the Arizona statute defining vehicle. See Ariz. Rev. Stat. Annot. § 28-101(59) (1989). And, Arizona has faced a question similar to the one we now resolve — there, an off-road accident involving a golf cart. Chase v. State Farm Mut. Auto. Ins. Co., 131 Ariz. 461, 641 P.2d 1305 (Ariz. App. 1982). In Chase, as here, the policy defined uninsured motor vehicle to exclude a vehicle designed for use primarily off public roads except while actually being used on public roads. 131 Ariz. at 462. The Arizona court held that automobile insurance does not cover injuries caused by equipment designed primarily for off-road use while actually being operated off road. Because coverage for operation of a golf cart resulting in an accident off the public highway was neither required nor prohibited by Arizona’s uninsured motorist act or safety responsibility act, the Chase court ruled the exclusion of such off-road accidents is a matter of contract between the insurer and the insured. Chase v. State Farm Mut. Auto. Ins. Co., 131 Ariz. at 468.
We do not read our own no-fault law or uninsured motorist law to either require or prohibit coverage for off-road accidents caused by the off-road operation of a device designed primarily for use off road. Accordingly, the question becomes one of contract between the insurer and the insured. See Kansas Farm Bureau Ins. Co. v. Cool, 205 Kan. 567, 471 P.2d 352 (1970).
Common sense also supports our conclusion. Devices designed primarily for use off road, while actually being used off road for recreational or sporting activities (rather than for transportation of people on a public highway), simply pose a greater risk of injury. Insurance companies should not be expected to insure such greater risks at the same rate associated with the “normal” use of such devices for on-road transportation purposes.
We hold, therefore, that under the facts of this case plaintiff was not entitled to PIP coverage and was not entitled to uninsured motorist coverage for the off-road accident.
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Lewis, J.:
Southwest National Bank (Bank) filed suit against Simpson & Son, Inc., (Simpson) for contractual indemnification. Both parties filed motions for summary judgment and the trial court granted summary judgment in favor of Simpson. The Bank appeals from the entry of summary judgment against it and from the trial court’s denial of the Bank’s motion for summary judgment.
After review, we reverse and remand.
In 1985, the Bank retained Simpson as a general contractor to do remodeling and construction work. Simpson prevailed on an architect to prepare the agreement for the parties. The parties utilized as their agreement a form devised by the American Institute of Architects (AIA). The particular form utilized was AIA document Alll, 1978 edition. This document, on its face, is to be used “where the basis of payment is the cost of the work plus a fee.” The agreement also provided, on its face, “Use only with the 1976 edition of AIA document A201, General Conditions of the Contract for Construction.”
This lawsuit arises as a result of injuries initially sustained by Scott Brunner. Brunner was injured in the replacement of freight elevator doors located at the Bank. The replacement of these doors was part of the work to be performed by Simpson for the Bank. In order to complete this particular part of the project, Simpson purchased the replacement doors and accompanying hardware from a concern known as Hollow Metal Doors (HMD). Included in the materials ordered by Simpson were “closures” or “closers,” which apparently functioned in the manner their name implies. When Simpson attempted to complete the replacement of the elevator doors, it found that the “closures” did not fit. After some discussion, HMD agreed to order replacement closures and to install them upon their arrival. This arrangement was apparently satisfactory to all parties, and the Bank paid Simpson in full with the understanding the job was to be completed when the proper closures arrived.
Upon arrival of the closures, HMD sent its own employees, including Scott Brunner, to install the hardware. During the process of the installation, Brunner was seriously injured.
Brunner proceeded to sue the Bank and Simpson, alleging that their negligence was the proximate cause of his injuries. Simpson settled with Brunner, who continued his lawsuit against the Bank. Ultimately, the jury returned a verdict of $270,000 in favor of Brunner and against the Bank, and found the Bank to be 85 percent at fault, Brunner to be 7.5 percent at fault, and Simpson to be 7.5 percent at fault. The Bank appealed the verdict to this court and, after reducing the damage award by $21,000, we otherwise affirmed the award in favor of Brunner. Brunner v. Southwest Nat’l Bank, No. 63,489, unpublished opinion filed December 8, 1989.
The Bank then sued Simpson, seeking indemnification under a provision included in AIA document A201. Simpson argues that A201 was not a part of its agreement with the Bank. Document A201 was not attached to document Alll, although it was referred to in document Alll, and was purportedly -incorporated by reference into the agreement of the parties.
This is an appeal which involves a number of issues, and we shall address them separately.
DID THE TRIAL COURT ERR IN GRANTING SUMMARY JUDGMENT IN FAVOR OF SIMPSON?
As we pointed out above, Brunner filed a lawsuit against both the Bank and Simpson after he was injured on the job site. During the pendency of this action, Simpson filed a motion for summary judgment against Brunner on the ground that Brunner’s only relief against Simpson would be to file a workers compensation claim. The trial court denied the motion for summary judgment, holding as follows:
“I’m going to deny the motion. At best defendant has a factual issue that needs to be determined by a jury. That’s all I’m going to say other than suggest to both counsel you better work real hard on your jury instructions on this issue. You want to help the trial judge and, more important than helping the trial judge, present your issue to a jury for a determination.” (Emphasis added.)
Rather than submit the factual issue identified by the court to the jury, Simpson quietly settled with Brunner for the sum of $40,000.
During the trial between the Bank and Simpson, Simpson filed its own motion for summary judgment against the Bank. This motion was heard by Judge Buchanan, whereas the Brunner motion had been heard by Judge Kennedy. Judge Buchanan granted Simpson’s motion for summary judgment and, as his only reason, stated:
“The decision of Judge Kennedy on the motion for summary judgment of Simpson and Son, Inc., heard August 11, 1988, filed August 12, 1988, became the law of the case, even though not journalized as ordered, and determined the relationship of Scott Bruner [sic] to the various parties. If Scott Bruner [sic] had been doing work under the contract, as opposed to merely delivering and unloading goods, his exclusive remedy would be under the Workers’ Compensation Act. The decision of Judge Kennedy took him out of the contract and out of the sole remedy against Simpson and Sons, Inc. Therefore, Scott Bruner [sic] was not doing work under the contract.”
The trial court’s reliance on the decision of Judge Kennedy as a basis for granting summary judgment in favor of Simpson was misplaced. It is immediately apparent that Judge Buchanan misread the decision of Judge Kennedy. Judge Kennedy did not decide that Scott Brunner was not doing work under the contract. Judge Kennedy decided that whether Brunner was a statutory employee of Simpson was a question of fact to be determined by the jury. Judge Kennedy determined only that this issue was a disputed question of fact. Since Simpson chose not to litigate this question of fact, but settled with Brunner, the issue identified by Judge Kennedy was never resolved.
We have no choice but to hold that Judge Buchanan was in error concerning the effect of the decision of Judge Kennedy. It follows that his decision to grant Simpson’s motion for summary judgment on the basis of Judge Kennedy’s ruling was also in error, and we reverse the entry of summary judgment in favor-of Simpson.
Simpson rather ingenuously argues that we should indulge in some speculation and that, by so doing, we can sustain the decision of Judge Buchanan. Despite the apparent seriousness with which it pursued its motion against Brunner, Simpson now argues that its motion for summary judgment against Brunner was without merit. It strongly suggests that, had there been a trial, it would have lost on that issue. Simpson now argues that we should sustain the decision of the district court on the rather startling premise that, had it gone to trial based on the theory set forth in its motion for summary judgment,' it was doomed to certain failure. We choose not to speculate as to how that issue might have been decided had it gone to trial. We deal in realities here, and the reality is that Judge Buchanan granted the motion for summary judgment on an incorrect premise. He labored under the belief that Judge Kennedy had resolved the factual questions and that this decision was the “law of the case.”
The term “law of the case” simply means that, once an issue is determined by a previous order of the court, further litigation of that issue is generally foreclosed insofar as that particular lawsuit is concerned. See, e.g., United States v. U. S. Smelting Co., 339 U.S. 186, 198-99, 94 L. Ed. 750, 70 S. Ct. 537 (1949); Messinger v. Anderson, 225 U.S. 436, 444, 56 L. Ed. 1152, 32 S. Ct. 739 (1912); United States v. Carson, 793 F.2d 1141, 1147 (10th Cir. 1986). The ruling by Judge Kennedy certainly did not establish as the “law of the case” the fact that Brunner was not injured when performing the work.
Our scope of review on a decision sustaining a motion for summary judgment has been set forth on a number of occasions.
“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. [Citations omitted.] When a summary judgment is challenged on appeal, an appellate court must read the record in the light most favorable to the party who defended against the motion for summary judgment. [Citations omitted.]” Patterson v. Brouhard, 246 Kan. 700, 702-03, 792 P.2d 983 (1990).
Our review of Judge Buchanan’s decision under the strictures stated above and pursuant to the settled law of this state reveals that his decision is erroneous and must be reversed.
MAY THIS COURT REVIEW THE DENIAL OF THE BANK’S MOTION FOR SUMMARY JUDGMENT?
The Bank filed its own motion for summary judgment against Simpson. The trial court denied that motion, and the Bank has appealed.
Simpson argues that this court has no jurisdiction to review the denial of the Bank’s motion for summary judgment. We turn first to the question of our jurisdiction.
Simpson submits that the trial court’s denial of the Bank’s motion for summary judgment is not properly appealable. It bases this argument on the fact that, as to the Bank, the denial of its motion for summary judgment is not a final order. We do not agree with Simpson’s construction of the law in this regard.
It is true that our cases often state the rule that a denial of a motion for summary judgment is not an appealable decision. See In re Estate of Ziebell, 2 Kan. App. 2d 99, 100-01, 575 P.2d 574 (1978).
As with any rule, there are many exceptions to the rule stated above, and one such exception is found in Kauk v. First Nat’l Bank of Hoxie, 5 Kan. App. 2d 83, Syl. ¶ 3, 613 P.2d 670 (1980), in which this court held:
“In general, a party may only appeal from the entry of a summary judgment in favor of the opposing party, and not from the denial of the party’s own motion for summary judgment. However, when a motion for summary judgment is denied at the time a motion for summary judgment in opposition is granted, the denial of summary judgment may be considered with an appeal from the grant of summary judgment.”
We note that in Kauk the trial court had filed a certificate under K.S.A. 60-254(b), finding that its denial of the motion for summary judgment was a final judgment.
We believe that, despite the absence of the 60-254(b) certification in this case, the reasoning of Kauk is sound, and we apply it here to take jurisdiction of this issue of the Bank’s appeal. The absence of the 60-254(b) certification is not dispositive. That statute applies where other claims remain after the granting of summary judgments. In this case, no other claims remained. The granting of Simpson’s motion and the denial of the Bank’s motion essentially completed the case and constituted a final order. The court’s twin rulings were, in effect, a final decision since nothing further remained to be decided in the litigation.
K.S.A. 1989 Supp. 60-2102(a)(4) provides that, on appeal from a final decision, “any act or ruling from the beginning of the proceedings shall be reviewable.” Under the circumstances presented here, the denial of the Bank’s motion for summary judgment is reviewable.
IS THE BANK ENTITLED TO SUMMARY JUDGMENT?
In determining this issue, there are three questions which we must resolve: (a) Was AIA document A201 incorporated by reference into the agreement of the parties; (b) is the Bank entitled to judgment on its indemnification claim based on the uncontroverted facts; and (c) did the Bank waive its claim for indemnification ? (a) Was AIA document A201 incorporated by reference into the agreement of the parties?
The clause on which the Bank bases its claim for indemnification is found in AIA document A201. It is central to the determination of the Bank’s claim to determine whether AIA document A201 was incorporated by reference into the agreement of the parties. This issue has been dealt with by courts of our sister states, but appears to be a case of first impression in Kansas. The Bank cites Steffek v. Wickers, 211 Kan. 342, 507 P.2d 274 (1973), as authority that Kansas recognizes the incorporation by reference of form A201. That decision contains the following statement: “AIA Document A201, General Conditions of the Contract, which was made a part of the agreement by reference, is material to the determination of this case.” 211 Kan. at 344. That statement is nothing more than a reflection of the agreement of the parties. The question of whether A201 was incorporated was not an issue, and Steffek provides us with no guidance in resolving that question.
The Bank argues that A201 and all of its provisions were incorporated by reference in the agreement of the parties. Simpson insists that A201 was not part of the agreement between the parties or, at the very least, the contract is ambiguous on the question of incorporation.
First of all we note that A201 was not stapled to document Alll, nor does it seem to have been physically present when the parties executed the agreement. The only document actually signed by the parties was AIA document Alll. That document, on its front page, states: “Use only with the 1976 edition of AIA document A201, General Conditions for Construction.”
Article 1 of Document Alll reads as follows:
“The Contract Documents consist of this Agreement, the Conditions of the Contract (General, Supplementary and other Conditions), the Drawings, the Specifications, all Addenda issued prior to and all Modifications issued after execution of this Agreement. These form the Contract, and all are as fully a part of the Contract as if attached to this Agreement or repeated herein. An enumeration of the Contract Documents appears in Article 16. If anything in the Contract Documents is inconsistent with this Agreement, the Agreement shall govern.”
Article 16.2, which is referred to in Article 1, reads as follows:
"The Contract Documents, which constitute the entire agreement between the Owner and the Contractor, are listed in Article 1 and, except for Modifications issued after execution of this Agreement, are enumerated as follows: (List below the Agreement, the Conditions of the Contract [General, Supplementary, and other Conditions], the Drawings, the Specifications, and any Addenda and accepted alternates, showing page or sheet numbers in all cases and dates where applicable.)”
Despite the indication that the contract documents are enumerated “as follows,” no documents are, in fact, listed following Article 16.
Simpson argues that, since form A201 is not listed following Article 16, it is not a part of the contract or the contract is ambiguous and we must resort to parol evidence to decide the issue. We do not agree.
Unless a contract is ambiguous, its meaning must be determined solely from its four corners. Kansas Gas & Electric Co. v. Kansas Power & Light Co., 12 Kan. App. 2d 546, 551, 751 P.2d 146, rev. denied 243 Kan. 779 (1988). Further, “[w]hether an ambiguity exists in a written instrument is a question of law to be decided by the court.” Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, 133, 754 P.2d 803 (1988).
Although there are no Kansas cases on point, there are two cases from sister states which are almost exactly on point and which we choose to follow. In Walker v. V & V Constr. Co., Inc., 28 Mass. App. Ct. 908, 545 N.E.2d 1192 (1989), the question was whether an arbitration clause in form A201 was part of the agreement between the parties. The contract documents and the arguments advanced are nearly identical to those in the instant matter. After reciting the notations on document Alll, which are exactly the same as on the documents in the instant matter, the Massachusetts court held that A201 was incorporated by reference, stating:
“Given these facts, we hold that the general conditions referred, to were a part of the contract despite the allegations (which we accept as true for purposes of deciding this appeal) that the general conditions were never delivered to the plaintiffs and were never brought to their attention until the action had been commenced. The master contracts the parties signed plainly indicated they were to be read with the general conditions form AIA Document A201, and if the parties wished to vary this provision they should have so stated by way of addendum or otherwise. The failure to list the general conditions form in Article 16 at best created an ambiguity .which, in the absence of evidence of mutual agreement not to employ the general conditions form, is properly resolved by the court as matter of law. See Sherman v. Employers’ Liab. Assur. Corp., Ltd., 343 Mass. 354, 356, 178 N.E.2d 864 (1961); see also Restatement (Second) of Contracts § 212(2) (1979). Immaterial in this connection is the assertion of the plaintiff Randall Walker that he personally did not intend to make contract disputes subject to arbitration. [Citations omitted.]” 28 Mass. App. Ct. 908-09.
In Jim Carlson Const., Inc. v. Bailey, 769 S.W.2d 480 (Mo. App. 1989), the issue was again identical to the one now before this court. The language in Article 1 of the agreement construed by the Missouri court was exactly the same as appears in the contract in the instant matter. Article 7 in the agreement before the Missouri court read exactly as does Article 16 in the present case. In addition, in Bailey, there were no contract documents enumerated following Section 7.2 (which corresponds to Article 16.2 in the instant matter). Additionally, there were no other documents attached to the contract when it was signed by the parties.
The question before the Missouri court, as it is here, is whether document A201 was incorporated by reference' in the face of the failure of Article 16 to list that document. The Missouri court held that it was incorporated by reference and held as follows:
“The mere fact that the parties disagree on the interpretation of a contract does not render the document itself ambiguous. The test is whether the disputed language, in the context of the entire agreement, is reasonably susceptible of more than one construction giving the words their plain and ordinary meaning as understood by a reasonable average person. [Citation omitted.] Whether a contract is ambiguous is a question of law for the court. [Citation omitted.]
“Even when there is ambiguity in a contract it is construed against .the drafter, [citation omitted] and seeming contradictions must be harmonized away if reasonably possible. [Citation omitted.] Furthermore, an interpret tation .of a contract or. agreement which evolves unreasonable results, when a probable and reasonable construction can be adopted, will be rejected. [Citation omitted.]
“The lack of enumeration of the contract documents after Section 7.2 of the Agreement does not render the Agreement in the case at bar ambiguous. In reviewing the Agreement as a whole, Article 1 definitively states that the general conditions are made fully a part of the' contract as if attached to the agreement. The Agreement further states, under Section 7.2, that the Contract Documents which constitute the entire agreement are listed in Article 1. Section 7.2 of the Agreement does provide that ’[t]he Contract Documents . . . are enumerated as follows’ and the notation immediately thereafter directs that among the contract documents to be listed are the Agreement, the General Conditions, the Drawings and the Specifications. However, it is not a reasonable interpretation of the contract to say that merely because the Agreement itself, the General Conditions, the Drawings and the Specifications are not listed following Section 7.2 that they are not a part of the contract and not binding upon the parties in spite of the otherwise definitive language of the contract to the contrary. If all of these documents were excluded as a part of the contract documents, there would be no contract; a proposition which neither of the parties advance.” 769 S.W.2d at 482.
See L. R. Foy Const. Co., Inc. v. Dean L. Dauley, Etc., 547 F. Supp. 166 (D. Kan. 1982); First Condominium Develop. v. Apex Const., 126 Ill. App. 3d 843, 467 N.E.2d 932 (1984).
We agree with the reasoning of the Missouri and Massachusetts courts cited above. To hold that document A201 was not incorporated by reference would not be a reasonable interpretation of the agreement of the parties. It is clear that document Alll was not drafted with the intent that it should compose the entire agreement of the parties. It clearly states that it is to be used in connection with document A201. AIA document A201 is comprised of some 19 pages, has 15 different articles, and covers a number of issues vital to the agreement between the parties. As is pointed out in Bailey, without document A201, the parties would simply not have a completed agreement.
We conclude, in concert with the Missouri and Massachusetts opinions cited above, that document A201 was incorporated by reference into the agreement of the parties. We reach that conclusion by confining ourselves to a construction of the four corners of the agreement and hold that the agreement is not ambiguous as to this issue.
(b) Is the Bank entitled to judgment on its indemnification claim based on the uncontroverted facts?
It was the contention of the Bank in filing this action that Simpson is required to indemnify it for the damages the Bank was required to pay Brunner. This claim springs from Article 4.18.1 of Document A201, which reads as follows;
“4.18.1. To the fullest extent permitted by law, the Contractor shall indemnify and hold harmless the Owner and the Architect and their agents and employees from and against all claims, damages, losses and expenses, including but not limited to attorneys’ fees, arising out of or resulting from the performance of the Work, provided that any such claim, damage, loss or expense (1) is attributable to bodily injury, sickness, disease or death, or to injury to or destruction of tangible property (other than the Work itself) including the loss of use resulting therefrom, and (2) is caused in whole or in part by any negligent act or omission of the Contractor, any Subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, regardless of whether or not it is caused in part by a party indemnified hereunder. Such obligation shall not be construed to negate, abridge, or otherwise reduce any other right or obligation of indemnity which would otherwise exist as to any party or person described in this Paragraph 4.18.”
This particular provision of the agreement requires Simpson to indemnify the Bank for the claim in question if the following conditions are met: (1) The claim, damage, or loss must have arisen out of the performance of the work; (2) the claim, damage, or loss must have been attributable to bodily injury; and (3) the claim, damage, loss, or expense must have been caused in whole or in part by the negligence of Simpson.
Our review of the record indicates that all three of these conditions have been shown by uncontroverted evidence.
Indeed, only the first condition is in the slightest doubt. Brunner’s claim arose from his installation of “closures” in the Bank’s freight elevator. At the time he was injured, Brunner was employed by HMD and not by Simpson. Simpson argues that its relationship with HMD is that of vendor and vendee and that Brunner was somehow not performing any “work” (under the contract) when he was injured.
We disagree and hold that the uncontradicted facts of this case show that, when Brunner was injured, he was performing work under the agreement. It is not relevant whether Brunner was or was not a statutory employee of Simpson. Whatever status he occupied, the fact is that, at the time of his injury, Brunner was performing work which Simpson had contracted to perform. AIA document Alll identified, in part, the work to be performed by Simpson as follows: “Removal and replacement of the doors, frames and hardware at the freight elevator entrance in the ally [sic] north of the bank.”
It was precisely this “work” that Brunner was performing when he was injured. His claim did arise from the “work to be performed” under the contract. In addition to the claim having arisen from the work, there is no question that the claim was one for bodily injury sustained by Brunner. As to the fault aspects, the jury concluded Simpson to have been 7.5 percent at fault for causing the injury, thus satisfying the third condition precedent to a claim of indemnification.
We hold that, based on the uncontroverted facts developed in this matter, the Bank was entitled to summary judgment on its claim against Simpson for indemnification, unless the Bank is deemed to have waived that claim.
(c) Did the Bank waive its claim for indemnification?
The final argument by Simpson is that, by making final payment on its contract with Simpson, the Bank waived its right to indemnification. Simpson bases this argument on Article 9.9.4, document A201, which reads as follows:
“The making of final payment shall constitute a waiver of all claims by the Owner except those arising from:
“.1 unsettled liens,
“.2 faulty or defective Work appearing after Substantial Completion,
“.3 failure of the Work to comply with the requirements of the Contract Documents, or
“A terms of any special warranties required by the Contract Documents.”
First of all, we have great doubts as to whether the waiver contemplated by Article 9.9.4 applies to a claim for indemnification under Article 4.18. Article 4.18 applies to claims for personal injuries sustained as a result of the performance of the “work.” This indemnification provision obviously contemplates a long-term situation in which a third party may be injured by a defective part of the project long after the final payment has been made. It seems to us nonsensical to hold that a claim for indemnification for bodily injury under Article 4.18 is waived simply because the job is completed and the final payment has been made. A more reasonable interpretation of Article 9.9.4 is that it does not bar claims for indemnification, but may bar other, more direct, contractual disputes between owner and contractor over the quality of the work where the issue is not raised until after payment and issuance of a certificate of completion.
We also believe that this particular claim for indemnification arose from the failure of the work to comply with the contract documents under section .3 of Article 9.9.4. Factually, there is no question but that this claim for indemnification would never have arisen had Simpson obtained the proper “closures” to complete the elevator work. Brunner was injured in installing these “closures” because Simpson had failed to order or obtain the proper hardware to comply with the contract documents. Under such circumstances and by the very terms of Article 9.9.4, payment of the final contract price did not waive a claim for indemnification which arose because of Simpson’s failure to provide materials which complied with the requirements of the contract document.
Finally, the uncontroverted facts in this case show that the Bank was induced to pay Simpson by the assurance of Simpson that it would complete the work and see that the closures were installed. It is apparent that both parties contemplated additional work would be performed after the final payment and, under these circumstances, we are not constrained to hold that the Bank waived its right to indemnification which arose from the work agreed to be performed in the future. In City of Wamego v. L. R. Foy Constr. Co., 9 Kan. App. 2d 168, 172, 675 P.2d 912, rev. denied 234 Kan. 1076 (1984), this court defined “waiver of a contractual right”:
“Waiver in contract law implies that a party has voluntarily and intentionally renounced or given up a known right, or has caused or done some positive act or positive inaction which is inconsistent with the contractual right. United American States Bank & Trust Co. v. Wild West Chrysler Plymouth, Inc., 221 Kan. 523, 526, 561 P.2d 792 (1977).”
In the instant matter, the conduct of the Bank in making final payment to Simpson in reliance on Simpson’s agreement to provide the contract materials to complete the contract cannot be said to have been an act which voluntarily and intentionally relinquished the contractual right to indemnification.
The judgment of the district court is reversed and the matter is remanded with directions to enter summary judgment in favor of the Bank and against Simpson and to award the necessary monetary damages and other relief flowing as a result of such entry of judgment.
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Wahl, J.:
John Lemery was killed in the course of his employment on April 13, 1987. His children were paid workers compensation benefits until they recovered against Buffalo Airways, Inc., the owner and operator of the plane in which Lemery was riding at the time of his death. Mid-Continent Transport, Inc., and Bituminous Insurance Company appeal the district court’s order requiring them to contribute attorney fees proportionate to the amount Lemery’s children would have received under workers compensation beyond the date of plaintiffs’ settlement with Buffalo.
John Lemery was employed by Mid-Continent Transport, Inc., at the time of his death. He was survived by two minor sons, the plaintiffs in this action, who bring this action through their mother and natural guardian, Debra L. Garrison, Lemery’s former wife.
Garrison filed a claim for workers compensation death benefits on behalf of her minor sons. An award was entered by the Workers Compensation Director on January 26, 1988, in favor of the minor children against Mid-Continent Transport, Inc., and its compensation carrier, Bituminous Insurance Company. The award provided the boys with maximum benefits of $247 per week from the date of John Lemery’s death until age 18, or age 23, provided certain statutory conditions were met. Funeral expenses were also ordered paid.
Garrison, as guardian for the minor boys, instituted a civil action against Buffalo Airways, Inc., the owner of the aircraft in which Lemery was riding at the time of his death. K.S.A. 1989 Supp. 44-504(b) allowed Mid-Continent to intervene as subrogee in that civil action and gave Mid-Continent a lien on any recovery by the minors to the extent of the workers compensation benefits paid.
Following discovery, Buffalo settled with the minor boys for $450,000. This settlement was approved by the court on March 31, 1989, and Buffalo was dismissed. After deducting litigation expenses of $6,584.87 from the total recovery, a one-third contingency attorney fee in the amount of $147,805.05 was also approved by the court.
The plaintiffs and Mid-Continent could not agree on each party’s liability for attorney fees. A hearing was held to resolve two issues: (1) the attorney fees Mid-Continent should pay for plaintiffs’ recovery of amounts paid as workers compensation benefits to the date of the civil settlement and (2) whether attorney fees and expenses should be paid on future credits from the settlement.
Mid-Continent stipulated that a one-third contingency fee was reasonable for the recovery of the amounts previously paid as workers compensation benefits, but did not stipulate that a one-third contingency fee was a reasonable attorney fee on future credits or that such fee was even allowable under K.S.A. 1989 Supp. 44-504(g).
Following oral argument, the court concluded that K.S.A. 1989 Supp. 44-504(g) requires Mid-Continent to pay attorney fees based not only on amounts previously paid as benefits, but also on future credits. Mid-Continent was ordered to pay $8,852.85 in attorney fees and expenses on the $26,770.95 lien recovery for benefits paid to the date of the settlement. On the issue of future credits, the district court concluded that Mid-Continent was responsible for its proportionate share of attorney fees and litigation expenses. However, since it is unknown how long the plaintiffs will remain eligible for workers compensation benefits, the total amount of future credits is uncertain. Therefore, Mid-Continent was ordered to send the plaintiffs a check for $85.95 for each week the plaintiffs are eligible for workers compensation benefits.
Mid-Continent timely appeals and we affirm.
Mid-Continent contends that K.S.A. 1989 Supp. 44-504 does not require it to contribute to attorney fees and litigation expenses beyond the date of plaintiffs’ settlement with Buffalo and that the district court erred as a matter of law by construing the statute to require proportionate contributions beyond March 31, 1989.
The construction and interpretation of K.S.A. 1989 Supp. 44-504(g) is a question of law, subject to unlimited appellate review. Pyeatt v. Roadway Express, Inc., 243 Kan. 200, 204, 756 P.2d 438 (1988).
K.S.A. 1989 Supp. 44-504 provides, in pertinent part:
“(a) When the injury or death for which compensation is payable under the workers compensation act was caused under circumstances creating a legal liability against some person other than the employer or any person in the same employ to pay damages, the injured worker or the worker’s dependents or personal representatives shall have the right to take compensation under the workers compensation act and pursue a remedy by proper action in a court of competent jurisdiction against such other person.
“(b) In the event of recovery from such other person by the injured worker or the dependents or personal representatives of a deceased worker by judgment, settlement or otherwise, the employer shall be subrogated to the extent of the compensation and medical aid provided by the employer to the date of such recovery and shall have a lien therefor against such recovery and the employer may intervene in any action to protect and enforce such lien. Whenever any judgment in any such action, settlement or recovery otherwise is recovered by the injured worker or the worker’s dependents or personal representative prior to the completion of compensation or medical aid payments, the amount of such judgment, settlement or recovery otherwise actually paid and recovered which is in excess of the amount of compensation and medical aid paid to the date of recovery of such judgment, settlement or recovery otherwise shall be credited against future payments of the compensation or medical aid. . . .
“(c) . . . The court shall fix the attorneys’ fees which shall be paid proportionately by the employer and employee in the amounts determined by the court.
“(f) As used in this section, ‘compensation and medical aid’ includes all payments of medical compensation, disability compensation, death compensation, including payments under K.S.A. 44-570 and amendments thereto, and any other payments made or provided pursuant to the workers compensation act.
“(g) In any case under the workers compensation act in which the workers’ compensation fund or an insurer or a qualified group-funded workers’ compensation pool, as provided in K.S.A. 44-532 and amendments thereto, is subrogated to the rights of the employer under the workers compensation act, the court shall fix the attorney fees which shall be paid proportionately by the workers’ compensation fund, insurer or qualified group-funded workers’ compensation pool and the worker or such worker’s dependents or personal representatives in the amounts determined by the court based upon the amounts to be received from any recovery pursuant to an action brought under this section.”
As Mid-Continent notes, K.S.A. 1989 Supp. 44-504(g) is applicable to the case at bar. In Anderson v. National Carriers, Inc., 240 Kan. 101, 727 P.2d 899 (1986), the court concluded that the date of an employee’s settlement or other recovery against a third-party tortfeasor is the date upon which the subrogation arises. 240 Kan. at 103-06. Therefore, the provisions of the Workers Compensation Act which were in eifect on March 31, 1989, govern the disposition of this case.
No Kansas case has interpreted subsection (g). “In construing the Kansas Workmen’s Compensation Act, we are guided by the general rules of statutory construction and interpretation. We are required to seek out and, as far as possible, give effect to the legislative intent.” Hormann v. New Hampshire Ins. Co., 236 Kan. 190, Syl. ¶ 2, 689 P.2d 837 (1984).
“The fundamental rule of statutory construction, to which all others are subordinate, is that the purpose and intent of the legislature governs when that intent can be ascertained from the statute. Legislatures have encouraged the evolutionary elaboration of law by the courts through the deliberate enactment of highly generalized statutes. Therefore, in determining legislative intent, courts are not bound to an examination of the language alone but may properly look into the causes which impel the statute’s adoption, the objective sought to be attained, the statute’s historical background, and the effect the statute may have under the various constructions suggested.
In re Petition of City of Moran, 238 Kan. 513, 713 P.2d 451 (1986). State v. Phifer, 241 Kan. 233, 238, 737 P.2d 1 (1987).
K.S.A. 1989 Supp. 44-501(g) provides:.
“It is the intent of the legislature that the workers compensation act shall be liberally construed for the purpose of bringing employers and employees within the provisions of the act to provide the protections of the workers compensation act to both. The provisions of the workers compensation act shall be applied impartially to both employers and employees in cases arising thereunder.”
An additional rule of statutory construction is appropriate in interpreting K.S.A. 1989 Supp. 44-504(g). “In interpreting the attorney fee provisions of the workers’ compensation statutes, the Kansas Supreme Court expressed concern about interpreting the statute to have a 'chilling effect upon the prosecution by the employee of his cause of action.’ ” Anderson v. National Carriers, Inc., 11 Kan. App. 2d 190, 196, 717 P.2d 1068, aff'd 240 Kan. 101, 727 P.2d 899 (1986) (quoting Nordstrom v. City of Topeka, 228 Kan. 336, 341, 613 P.2d 1371 [1980]). Mid-Continent contends this rule of statutory construction has no place in the case at bar because, in Nordstrom, the court was concerned that the lack of apportionment of fees would have a “chilling effect” on plaintiffs willingness to bring a suit against a third-party tortfeasor. Mid-Continent contends some apportionment does not have a “chilling effect.” Mid-Continent’s contention that the rule in Nordstrom does not apply in this case does, at first hearing, have a surface plausibility. It appears the plaintiffs had a solid case against Buffalo and were able to settle for $450,000. The maximum amount plaintiffs could have received under workers compensation is $232,921. Plaintiffs netted $295,610.08 from their settlement with Buffalo. The fact they might not recover attorney fees from Mid-Continent was probably not a primary concern in the settlement. However, in less clear-cut cases, or in cases where the total damages draw closer to the amount the injured worker would recover under workers compensation, the apportionment scheme advocated by Mid-Continent would have a “chilling effect” on plaintiffs willingness to bring suit. An otherwise reasonable recovery from the tortfeasor could leave plaintiffs with less from the recovery than would be received from workers compensation. Therefore, the rule of construction announced in Nordstrom is applicable to the case at bar.
Mid-Continent contends the district court ignored the plain meaning of the words of K.S.A. 1989 Supp. 44-504(g): “amounts to be received from any recovery” and “judicially amended the statute to ‘amounts to be received and credits against future payments.’ ” Mid-Continent claims it never took possession of an amount greater than $26,770.65.
Mid-Continent’s argument appears to be based on the erroneous assumption that K.S.A. 1989 Supp. 44-504(g), when stating “amounts to be received from any recovery pursuant to an action brought under this section,” is referring to the workers compensation insurer. It does not refer to the insurer but refers to a recovery by the worker, or, as in this case, by the worker’s dependents. Mid-Continent never actually “receives” any money from plaintiffs’ settlement with Buffalo, but is only entitled to a lien on the amount recovered. As subrogee, Mid-Continent does not actually “recover” anything from Buffalo. Therefore, reading K.S.A. 1989 Supp. 44-504(g) in reference to the worker’s recovery, the district court has discretion to determine the appropriate amount of attorney fees to be paid by the subrogated insurer based upon the amount the plaintiffs will receive from their tort claim recovery.
The district court’s construction of K.S.A. 1989 Supp. 44-504(g) is consistent with the Supreme Court’s interpretation of 44-504(c). In Nordstrom, the court concluded:
“In an action under K.S.A. 1979 Supp. 44-504 against a third party tortfeasor, the provision in 44-504(c) that ‘[t]he court shall fix the attorneys’ fees which shall be paid proportionately by the employer and employee in the amounts determined by the court’ applies both to actions brought by the employee under 44-504(&) and to actions brought by the employer under 44-504(c).” 228 Kan. 336, Syl. ¶ 4.
“K.S.A. 1985 Supp. 44-504(c) [now K.S.A. 1989 Supp. 44-504(c)] gives the trial court the discretion to fix attorney fees to be paid proportionately by the employer and the employee when either brings an action against a third-party tortfeasor.” Anderson, 11 Kan. App. 2d at 196. “Abuse of discretion is defined as a decision by the trial court where no reasonable person would take the view adopted by the trial court.” 11 Kan. App. 2d at 197.
The district court in this case did not abuse its discretion. Despite Mid-Continent’s protestations, plaintiffs’ action will save Mid-Continent a significant sum of money. Had plaintiffs merely taken the maximum possible workers compensation benefits, it would have'amounted to $232,921. Mid-Continent’s allotted portion of the attorney fees amounts to $49,268.35. It is not unfair that Mid-Continent contribute to the amount of attorney fees incurred by plaintiffs and which saved Mid-Continent from paying compensation benefits.
By adopting K.S.A. 1989 Supp. 44-504, the legislature has attempted to achieve two things: (1) to preserve an injured worker’s cause of action against third-party tortfeasors and (2) to pre vent a double recovery by the employee from both the workers compensation fond and a third-party tortfeasor. It is also clear from the language of K.S.A. 1989 Supp. 44-504(c) and (g) that the legislature intended, the courts to apportion expenses of recovery against third-party tortfeasors between the employee and the workers compensation fond or the insurer.
To allow Mid-Continent to pay only a small portion of the total attorney fees and litigation expenses will dissuade future injured workers from pursuing, their claims against third-party tortfeasors. In addition, to permit Mid-Continent to enjoy the benefits of the plaintiffs’ acts and not to require it to pay a portion of the expenses is a very unlikely determination of the legislative intent.
As Mid-Continent suggests, the plaintiffs’ exhaustive review of cases from other jurisdictions is of limited precedential value. In Nordstrom, the court considered the value of cases from other jurisdictions concerning 44-504, and noted:
“The question is one of first impression before this court, although there are literally dozens of decisions from other jurisdictions which have considered the issue. . . . However, nearly all of the decisions frpm other jurisdictions are based upon the interpretation of the particular state statutes involved, none of which appear to be identical to ours, and therefore are not particularly helpful in answering the question before this court. We see nothing to be gained by an extensive recitation of the theories and-rationales followed by other jurisdictions in deciding the question.” 228 Kan. at 340.
However, a clear majority of other jurisdictions, when confronted with this same issue, have rejected Mid-Continent’s interpretation.
“Since the employer’s right- of reimbursement extends not- only to past compensation paid but to future liability, most courts have concluded that the employer’s equitable share of the fees and costs involved? in the employee’s third-party recovery should be calculated on his total potential liability, rather than on past benefits actually paid.” 2A Larson-,, Workmen’s Compensation Law §• 74.32(a)(4) (1989).
We conclude.1 that the entire recovery settlement to plaintiffs from Buffalo constituted the proper basis for determination of attorney fees to be apportioned between the plaintiffs and the compensation insurer. The statute speaks in terms of “the amounts to be received from any recovery,” and we: can- discern no rational basis upon which to limit the apportionment of fees to compensation payments already made by Mid-Continent. The payment of the fees on a weekly basis as ordered by the trial court eliminates the possibility of Mid-Continent’s paying its portion of fees after compensation is no longer due.
The trial court properly construed K.S.A. 1989 Supp. 44-504 and did not abuse its discretion in the apportionment of attorney fees and litigation expenses.
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Lewis, J.:
The Kansas Workers Compensation Fund (Fund) appeals the decision of the district court apportioning a settled compensation award between the Fund and the respondent.
This is the second occasion we have confronted an appeal in this particular workers compensation claim. On the first appeal, we reversed the district court and, after our review on this second occasion, we have no choice but to reverse again.
The claimant is not a party to this appeal, nor was he a party to the first appeal. The question of how much workers compensation claimant would receive for his injuries was settled in 1986. Since that time, the litigation has continued between the Fund and the respondent on the issue of the Fund’s liability.
The facts indicate the claimant suffered an injury to his back while working for respondent on July 20, 1984. On July 25, 1984, he suffered yet another injury. The parties negotiated a settlement figure of $27,500, and this amount was stipulated to be reasóiiable and appropriate by the Fund. While agreeing to the total settlement figure, the Fund denied any liability and reserved the right to litigate the issue of its liability.
Subsequent to the settlement hearing, the Fund and the respondent proceeded to litigate the issue of the Fund’s liability. It was ultimately determined by the Administrative Law Judge (ALJ), the director, and the trial court that claimant had sustained a zero to five percent functional disability after the first accident and a ten percent functional disability overall after the second accident. Based on these determinations, the trial court found that the Fund was responsible for 100 percent of the $27,500 settlement figure. The Fund appealed that decision.
On appeal, we reversed. We did so on the basis of the decisions in Brozek v. Lincoln County Highway Dept., 10 Kan. App. 2d 319, 689 P.2d 392 (1985), and Spencer v. Daniel Constr. Co., 4 Kan. App. 2d 613, 609 P.2d 687, rev. denied 228 Kan. 807 (1980). We remanded, instructing the trial court to make findings comparing disability figures before and after the second injury and to make awards for each injury. Our conclusions and instructions to the trial court in that case, No. 63,175, unpublished opinion filed August 25, 1989, were as follows: .
“The trial court should have compared disability figures before and after the second injury to determine the proportion of the total cost of the award attributable to the second injury. Derrig suffered a 0-5 percent functional disability following the first accident and a IP percent functional disability following the second accident. Also, there is no finding as to the work disability Derrig suffered following the second accident.
“Because the trial court stated a range of functional disability suffered by Derrig after the first accident and because there is no finding regarding work disability, this case must be remanded for determination of the difference in functional disability and for the entry of separate awards.
“Reversed and remanded for the entry of separate awards.”
The trial court was not, however, reversed on at least two issues which we deemed to have been decided on the first appeal: (1) The claimant’s functional disability was ten percent permanent partial general bodily disability, and (2) the second injury would not have occurred but for the first injury, making the Fund liable for 100 percent of the compensation due as a result of the second injury. Brozek, 10 Kan. App. 2d 319; Spencer, 4 Kan. App. 2d 613.
On remand, the trial court, pursuant to our direction, found that, as a result of the first injury, claimant sustained a permanent partial generál bodily disability of 2.5 percent. Overall, the total disability was ten percent, making the second injury responsible for a partial general bodily disability of 7.5 percent. Based on these findings, the trial court apportioned 25 percent of the medical expenses and other costs to respondent and 75 percent of those medical expenses and other costs to the Fund. This apportionment is not questioned by the Fund.
The trial court was instructed to compare disability figures before and after the second injury to determine the proportion of the total cost of the award attributable to the second injury. There is no question but that the trial court properly made findings to compare disability figures before and after the second injury. The difficulty is with the trial court’s apportionment of the $27,500 settlement award between the Fund and the respondent. In making this apportionment, the trial court ignored the settlement figure in determining the respondent’s liability. The court determined the respondent’s liability by using the mathematical formula contained in K.S.A. 1989 Supp. 44-510e as if the trial court were making an original award of compensation. The claimant’s average weekly wage was agreed to be $360, and the court computed the amount owed by the respondent for the first injury as follows: $360 X .667 = $240 X 0.025 X 415 = $2,490.
After having computed the above assessment as the responsibility of the respondent and without making any calculations as to the second injury, the trial court assessed the balance of the settlement figure, $25,010, to the Fund. That assessment is incorrect and requires that we reverse and remand.
We do so even though, interestingly enough, both parties insist that the trial court made the correct calculations. The respondent does so because it finds the results to its liking. The Fund does so because it wants any award against it determined in the same manner as the trial court determined the award against respondent. This result would not be nearly as pleasing to respondent.
The law in apportioning an award of compensation between a respondent and the Fund has been thoroughly dissected and explained in Brozek and Spencer. These two cases very clearly state that the Fund is liable for only the proportion of the cost of the award attributable to the second injury, and then only to the extent the second injury was contributed to by the preexisting impairment. Spencer, 4 Kan. App. 2d at 620. Indeed, even though the Fund may be liable for 100 percent of the impairment due to the second injury, it cannot be required to pay any part of the compensation due solely to the first injury. In this case, the Fund is liable for 100 percent of the second injury but cannot be responsible for more than the proportion the second injury contributes to the total disability caused by both injuries.
In this case, the total disability is ten percent permanent partial general bodily disability. In using the trial court’s comparison of disability figures, the second injury, for which the Fund is 100 percent responsible, contributed 7.5 percent of that disability and the first injury contributed 2.5 percent. It takes no mathematician to determine that the Fund cannot, under any circumstances, be responsible for more than 75 percent of the total award for both injuries. The apportionment by the district court results in the Fund being responsible for paying 90.95 percent of the total award. Since the second injury is responsible for no more than 75 percent of the total disability, it follows that the apportionment by the district court is in error.
The Fund, despite our conclusion to the contrary, argues that the district court properly computed the award to respondent and argues that the court should compute its liability for claimant’s disability in' the same fashion. The one exception, the Fund argues, is that we should use 317.29 weeks in the computation, which it arrives at by subtracting from the 415 weeks maximum 97.71 weeks of temporary total disability that the Fund has already paid. Assuming that the Fund is correct on the number of weeks to be used in the calculation, it would calculate its liability as follows: $360 X .667 = 240 X 0.075 X 317.29 = $5,711.20.
If the trial court’s computation of the liability of the respondent was correct, it seems only fair to compute the liability of the Fund in the same manner. When we do so, however, instead of apportioning the entire settlement of $27,500, we have only computed an entire award of $8,201.20. Since the claimant settled for total compensation of $27,500, we have, by this method, come up short $19,298.80, which is still owed to the claimant. Presumably the burden of paying that amount would fall to the respondent and its carrier, who agreed to pay claimant $27,500. Under this scenario, the computations result in respondent paying a total of $21,788 of the settled award, which is approximately 79 percent of the total compensation settled for.
It is apparent that a settled award of compensation cannot be apportioned in this manner. To attempt to apportion a settled award by using the formula set out in K.S.A. 1989 Supp. 44-510e is not possible. The only realities in this case are the percentage functional disabilities and the settlement award total. The statutory formula established by 44-510e has no application.
As we perceive it, the trial court’s approach to the problem is called for in cases in which the amount of compensation remains an issue. In the instant matter, the total amount of compensation was long ago settled by the parties. The, only issue remaining was the apportionment of the $27,500 settled compensation award between the first and the second injury. This apportionment is done by comparing disability figures before and after the second injury and then using those percentages not to award compensation, but to apportion the compensation already agreed upon. This is the only method, to our knowledge, by which a settled award may be apportioned on a basis which complies with the established law of this state.
We hold that in the instant matter in comparing the disability figures it is apparent that the first injury caused 25 percent of the claimant’s total disability, and the second injury caused 75 percent of the claimant’s disability. Under settled law, the Fund cannot be held responsible for more than the proportion to which the second injury contributes to the total disability. Accordingly, the appropriate award is to be calculated in the following manner: (a) $27,500 times 25 percent equals respondent’s liability of $6,875; (b) $27,500 times 75 percent equals the Fund’s liability, or $20,625.
This is the only method by which a proper apportionment can be made in a case where the total compensation is agreed to. In this case, the total compensation figure was unrelated to actual disability and was stipulated to by all of the parties.
The Fund’s argument might be persuasive if it had not agreed to the award of $27,500. There is no question in our minds but that the Fund did agree to that, despite its efforts to avoid admitting it. In the settlement hearing, the Fund was represented by W. Robert Alderson. After counsel for the respondent had announced the settlement figure, we find the following:
“Mr. Alderson: Your Honor, the worksheet and Mr. Mustain’s comments are in fact correct that the Workers’ Compensation Fund has stipulated that the settlement amount and the basis for the settlement is reasonable.
“I would like the record to reflect that by — by those stipulations the Fund does not agree or stipulate to the fact of there being two separate accidents; that that is a matter that is still at issue as regards the respondent and its insurance carrier and the Fund.
“Secondly, I want the record to reflect that from this date forward, the Fund, and we have so advised Mr. Mustain, will seek recovery of attorney’s fees in the event the Fund is not found liable for any or all of this award.” (Emphasis added.)
The Fund argues that it did not participate in the settlement hearing and was nothing more than an innocent bystander. The record clearly indicates otherwise. The Fund stipulated that the settlement amount and the basis for that amount were reasonable. Its attorney announced it would seek attorney fees if it were not found liable for “any or all of this award.” It is apparent that “this award” refers to the award of $27,500. The record indicates that the Fund led the respondent, its carrier, and the ALJ to believe that the amount of compensation had been settled. The Fund indicated that it had agreed to the award and was only going to litigate whether it was liable for any portion of that award. Having done so, the Fund cannot later attempt to ignore the settlement reached and insist that its liability be determined on the basis of the actual disability found. The actual disability found has nothing to do with the amount of compensation agreed to be paid in this case. It has only to do with the apportionment of the settlement award of $27,500. To permit the Fund to proceed as if the settlement had never happened would be grossly unfair to the respondent and its carrier. In Arrowhead Constr. Co. v. Essex Corp., 233 Kan. 241, Syl. ¶ 4, 662 P.2d 1195 (1983), the Supreme Court said: “As a general rule parties to an action are bound by . their pleadings and judicial declarations and are estopped to deny or contradict them where the other parties to the action relied thereon and changed their position by reason thereof. ”
In the present controversy, the respondent and its carrier assumed the issue of compensation had been settled. They were led to believe that the Fund only intended to litigate its share of the settled compensation. We will not permit the Fund to change its position by arguing that it. is only liable for the disability found by the court computed pursuant to 44-510e. That position completely changes the action and converts it into an action for compensation instead of one in which the amount of compensation has been settled.
The respondent has argued that the Fund’s appeal was frivolous and that it should be awarded attorney fees. In view of our decision in favor of the Fund, the respondent’s request for attorney fees is denied.
This case is reversed and remanded to the trial court with instructions to apportion the $27,500 compensation settlement figure on a basis of 25 percent to respondent and 75 percent to the Fund, which is the same manner in which the medical expenses and other costs were apportioned.
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Elliott, J.:
Plaintiff Darlene Stewart appeals from the summary judgment granted American States Insurance Company (ASIC) regarding uninsured motorist benefits. The trial court validated ASIC’s policy provision which provided that any amounts otherwise payable under uninsured motorist coverage would be reduced by all sums paid under the liability coverage of the policy.
We reverse and remand for further proceedings.
The facts are relatively simple and essentially uncontroverted. Plaintiff Stewart was a passenger in a car owned and driven by ASIC’s insured, Vayda Capps. The car was forced off the road by a vehicle which was neither identified nor located. Plaintiff Stewart was injured in the accident.
Stewart sued Capps and ASIC as Capps’ uninsured motorist carrier, alleging negligence on the part of the drivers of both vehicles and claiming damages in excess of $10,000. The policy defined “uninsured motor vehicle” to include a hit and run vehicle whose owner/operator cannot be identified and which hits “your covered auto.” Stewart is a “covered person” under ASIC’s uninsured motorist coverage as a person occupying the covered auto.
Stewart settled with Capps for the $25,000 policy limits under the liability coverage of the policy and proceeded against ASIC under the uninsured motorist coverage for an additional $25,000.
We note that our reading of the record does not reveal any determination of the extent of Stewart’s damages.
The trial court granted ASIC’s summary judgment motion and Stewart appeals. Our review of the trial court’s conclusion of law is, of course, unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
K.S.A. 40-284 mandates that all automobile liability policies provide uninsured motorist coverage in an amount equal to the liability coverage in the policy. The purpose of uninsured motorist coverage is to compensate the innocent victim who is injured by an uninsured motorist. Patrons Mutual Ins. Ass’n v. Norwood, 231 Kan. 709, 715-16, 647 P.2d 1335 (1982). In addition, the uninsured motorist statute should be liberally construed to fulfill its intended purpose. Van Hoozer v. Farmers Insurance Exchange, 219 Kan. 595, Syl. ¶ 2, 549 P.2d 1354 (1976).
K.S.A. 40-284(e) lists permitted exclusions and limitations to the mandated uninsured motorist coverage; the list does not contain the offsetting clause present in the ASIC policy.
The specific question here presented has not been decided in Kansas, so we must look elsewhere for analogous case law. And, we recognize the legislature is capable of responding to our holding in the present case.
For example, our Supreme Court in Van Hoozer v. Farmers Insurance Exchange, 219 Kan. 595, voided a policy provision which reduced uninsured motorist coverage by the amount of workers compensation benefits received. In response, the legislature amended 40-284 to specifically permit such a provision. L. 1981, ch. 191, § 1.
We find the cases upon which ASIC relies to be unpersuasive. For example, Duran v. Hartford Ins. Co., 157 Ariz. 125, 127, 755 P.2d 430 (Ct. App. 1988), involved a single car accident, and the court specifically recognized that different rationales and different public policy considerations operate in cases in which injury is caused by two negligent drivers. And, Auto-Owners Ins. v. Lydon, 149 Mich. App. 643, 648, 386 N.W.2d 628 (1986), was decided at a time when uninsured motorist coverage was not statutorily required in Michigan.
State Farm Mut. Auto. Ins. Co. v. Herron, 71 Cal. App. 3d 673, 139 Cal. Rptr. 575 (1977), is also distinguishable in that the setoff provision there involved was specifically authorized by statute. 71 Cal. App. 3d at 677. Further, the court acknowledges that an injured passenger can file a tort claim against the negligent driver of her car and also, as an insured under the driver’s uninsured motorist coverage, file a claim against the driver’s insurer for the negligence of the uninsured motorist. 71 Cal. App. 3d at 678.
In the present case, given the legislature’s response to Van Hoozer, we are persuaded that if the setoff provision in ASIC’s policy is to be valid and enforceable, it must join the laundry list of exclusions set out in K.S.A. 40-284, along with the permitted “limitations” to the extent that workers compensation benefits and personal injury protection benefits apply.
Because uninsured motorist coverage compensates for the liability of the uninsured motorist, and not the liability of plaintiff s driver Capps, the setoff provision in the ASIC policy operates as a limitation on how much Stewart can collect as a result of the alleged negligence of the uninsured motorist. This appears to us to be contrary to the uninsured motorist coverage mandated by statute. For example, see Welch v. Hartford Casualty Ins. Co., 221 Kan. 344, 350, 559 P.2d 362 (1977), where the Supreme Court held the injured insured was entitled to recover the same amount he or she would have recovered had the offending uninsured motorist been insured (“stacking” case).
We find the reasoning of Spain v. Valley Forge Ins. Co., 152 Ariz. 189, 731 P.2d 84 (1987) (en banc), persuasive. Spain and the present case are factually similar. There, as here, a passenger was injured (in Spain the passenger died) in an accident with a second car operated by an uninsured motorist. There, it was stipulated that both drivers were negligent; here, Stewart alleged that both drivers were negligent. There, as here, the insurance policies provided that sums paid under the liability coverage reduce the limit of liability under the uninsured motorist coverage.
The Arizona Court of Appeals ruled in favor of the insurance company, validating the policy provision offsetting the available uninsured coverage by amounts already recovered under the liability coverage of the same policy. Spain v. Valley Forge Ins. Co., 152 Ariz. 185, 731 P.2d 80 (Ct. App. 1985).
The Arizona Supreme Court reversed, noting that the Arizona courts had also invalidated setoff provisions reducing amounts payable under uninsured motorist coverage by amounts paid under workers compensation. 152 Ariz. at 193. We feel the public policy rationale stated in Spain is applicable in Kansas:
“The [uninsured motorist] statute establishes a public policy that every insured is entitled to recover under his or her [uninsured motorist] coverage the damages he or she would have been able to recover from a negligent uninsured driver had that driver maintained a policy of liability insurance with a solvent company.” 152 Ariz. at 192.
Accordingly, we hold that where uninsured motorist coverage equals the limit of liability coverage as in the present case and as contemplated by K.S.A. 40-284, plaintiff Stewart, as a covered passenger, has available the total of the two in the event of an accident involving two allegedly negligent drivers. ASIC’s attempt to reduce or dilute this coverage is void and unenforceable as against public policy. See 1 Widiss, Uninsured and Underinsured Motorist Insurance § 14.6 (2d ed. 1987).
We emphasize the uninsured motorist statute could, but does not, authorize the offset claimed by ASIC and contained in its policy.
The trial court erred in granting summary judgment in favor of ASIC.
Reversed and remanded for further proceedings consistent with this opinion. | [
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Brazil, J.:
Canadian Express Club appeals from a district court order affirming an administrative decision by the Kansas Securities Commissioner that Canadian Express Club was selling securities within the definition of K.S.A. 17-1252(j). We affirm.
Canadian Express Club is a corporation which solicits buyers to purchase shares in the Lotto 6/49 6000 group. The 6000 group is comprised of 250 shareholders whose money is pooled to purchase 6,000 Canadian lottery tickets over a six-week period. Total winnings from the tickets are split among the shareholders. Canadian Express Club guarantees that if the 6000 group does not receive some return within the six-week period, it will provide the group with 6,000 additional tickets and continue the group for six additional weeks.
K.S.A. 17-1269 instructs that review of a final order of the
Securities Commissioner should be taken in accordance with the act for judicial review and civil enforcement of agency actions. On review, the district court may find the agency action is invalid if the agency erroneously interpreted or applied the law. K.S.A. 77-621(c)(4). This court should make the same review of the Commissioner’s action as does the district court. See Board of Johnson County Comm’rs v. J. A. Peterson Co., 239 Kan. 112, 114, 716 P.2d 188 (1986).
The issue before this court is whether shares in the 6000 group constitute securities. K.S.A. 17-1252(j) provides a number of definitions of security, including any investment contract. The test to determine whether a financial relationship constitutes an investment contract was set out by the Supreme Court in S.E.C. v. Howey Co., 328 U.S. 293, 301, 90 L. Ed. 1244, 66 S.Ct. 1100 (1946), and adopted by the Kansas court in State ex rel. Owens v. Colby, 231 Kan. 498, 504, 646 P.2d 1071 (1982), where the court said that the test is “whether the contractual arrangement involves an investment of money in a common enterprise with profits to come from the efforts of others.” In Activator Supply Co. v. Wurth, 239 Kan. 610, 722 P.2d 1081 (1986), the court reviewed the principles of law set forth in Colby and noted: “[T]he Colby test requires four essential elements: (1) An investment of money (2) A common enterprise (3) An expectation of future profits (4) From the efforts of others.” 239 Kan. at 617. This court must determine whether the facts surrounding the 6000 group support a finding that an investment contract exists. In Colby the court said:
“The Kansas Securities Act is patterned after the Uniform Securities Act which is itself a copy of the Federal Securities Act of 1933. As apart of the web of the Uniform Acts throughout the nation and because of the common history and theories behind both the state and federal experience in the field of securities regulation, the Kansas Act should be developed by court decisions which are firmly grounded on prior state decisions and upon prior decisions of the federal courts, and the courts of our sister states.” 231 Kan. at 501.-
The first element of the investment contract test is an investment of money. In Wurth, the court adopted the federal securities act definition of investment of money. The term means “only that the investor must commit his assets to the enterprise in such a manner as to subject himself to financial loss. Hector v. Wiens, 533 F.2d 429, 432 (9th Cir. 1978).” 239 Kan. at 617. In S.E.C. v. Energy Group of America, Inc., 459 F. Supp. 1234, 1239 (S.D.N.Y. 1978), the court said, “An ‘investment’ typically involves parting with money for the purpose and in the reasonable expectation of making a profit.”
Canadian Express Club argues that paying to play the lottery is the equivalent of paying a fee and that neither transaction is an investment of money. Canadian Express Club relies on Energy Group of America, in which the court held that payment of a ten-dollar fee did not constitute an investment of money. 459 F. Supp. at 1239. That case focuses on the services provided by Energy Group of America (EGA) with regard to oil and gas lease lotteries conducted by the Bureau of Land Management (BLM). BLM awarded ten-year leases through a public drawing in which the winner of the lease must pay the first year’s rent in advance and thereafter pay annual rent. In return for a ten-dollar fee, EGA provided customers with a monthly listing of parcels of land expected to be subject to the BLM drawing, recommendations upon which parcels to bid, the submission of an entry card for the customer, and readiness to purchase the lease from the winner. 459 F. Supp. at 1237. In holding that the fee payment did not constitute investment of money, the court said, “Customers of EGA do not contribute capital to any enterprise with the intention of sharing in its profits and earnings — they merely pay a fee for which certain services are provided in return.” 459 F. Supp. at 1240.
In contrast, the shareholders of the 6000 group invest with hopes of making a profit on their investment. By investing, the participants subject themselves to the possibility of financial gains or losses. It is significant that Canadian Express Club’s advertising brochure consistently stresses the large dollar amounts which may be won and the likelihood of recovering some profit every six weeks. See Securities & Exch. Com’n v. Brigadoon Scotch Dist., Ltd., 388 F. Supp. 1288 (S.D.N.Y. 1975) (Advertising brochure, describing rare coins as an investment and comparing gains in stock market with returns from coins, used as evidence that coins were purchased for investment, not coin collecting.). The 6000 group shareholders are making an investment of money.
The second element of an investment contract is a common enterprise. A distinction has been made between horizontal commonality and vertical commonality. Horizontal commonality requires joint participation by all investors in the same investment enterprise. It requires that the investors provide capital and share in the earnings and profits. See Hirk v. Agri-Research Council, Inc., 561 F.2d 96, 100-01 (7th Cir. 1977). Vertical commonality requires that the fortunes of all investors be inextricably tied to the efforts of the promoters. Brigadoon Scotch Dist., Ltd., 388 F. Supp. at 1291.
It is unclear what type of commonality is required in Kansas. In Wurth, the court said, “A common enterprise is one in which the fortunes of the investor are interwoven with and dependent on the efforts and success of those seeking the investment or of third parties.” 239 Kan. 610, Syl. ¶ 7. This language seems to indicate that a finding of either horizontal or vertical commonality satisfies the common enterprise requirement. However, later in the opinion the court states:
“A major case defining ‘common enterprises’ is Securities & Exch. Com. v. Koscot Inter., Inc., 497 F.2d 473 (5th Cir. 1974), which relied on Securities & Exchange Com’n v. Glenn W. Turner Ent., Inc., 474 F.2d 476 (9th Cir. 1973), and held that a pyramid selling scheme involving sales of distributorships satisfied the ‘common enterprise’ element of the definition of an investment contract. The court in Koscot defined a common enterprise as one in which the ‘fortunes of the investor are interwoven with and dependent upon the efforts and success of those seeking the investment or of third parties.’ 497 F.2d at 478. Further, the court stated that the fact that the investor’s return is independent of that of other investors in the scheme (sometimes referred to as horizontal commonality) is not decisive. Rather, the requisite commonality is evidenced by the fact that the fortunes of all investors are inextricably tied to the efficacy of the promoters. 497 F.2d at 479. This is referred to as vertical commonality.” 239 Kan. at 618.
This language may be interpreted as requiring vertical commonality in Kansas.
Clearly, horizontal commonality exists in this case. The investors in the 6000 group pool their money and share in the profits. Vertical commonality is also present. The Canadian Express Club purchases the lottery tickets for the shareholders and does all the paperwork and bookkeeping. In addition, the Canadian Express Club recruits investors to insure the success of the pool for all the shareholders. Although the Canadian Express Club has no influence over the actual lottery, it does provide a way for the investors to play the lottery on a grand scale with increased odds of winning. The effectiveness of the Canadian Express Club in purchasing the tickets, bookkeeping, and recruiting participants is tied to the fortunes of the investors.
The third requirement of an investment contract is an expectation of future profits. The Canadian Express Club advertising brochure includes enticements of a guaranteed win or free participation in the next 6000 group. The brochure mentions a $13,000,000 jackpot and lesser cash prizes of between $400,000 and $600,000. The 6000 group participants are clearly investing to play the lottery in hopes of receiving future profits.
The final requirement of an investment contract is that the future profits result from the efforts of others. The test applied in determining whether future profits come from the efforts of others “is whether the efforts made by those other than the investor are the undeniably significant ones, those essential managerial efforts which affect the failure or success of the enterprise.” 239 Kan. at 620. The efforts of Canadian Express Club must affect the failure or success of the enterprise to satisfy the investment contract test.
Canadian Express Club argues the fourth element of the investment contract test is not satisfied because their efforts will not insure the success or failure of the 6000 group. They allege that the lottery is a game of chance in which the winning participants are dependent on the luck of the draw not the managerial or entrepreneurial efforts of Canadian Express Club.
Canadian Express Club compares the purchase of shares in the 6000 club to the purchase of gold coins or silver bars. In S.E.C. v. Belmont Reid & Co. Inc., 794 F.2d 1388 (9th Cir. 1986), the court reviewed the sale of gold coins at a fixed price to investors under a sale-of-goods contract in which the investor prepaid for the coins. The court held that the transaction was not an investment contract because the profits did not come from the efforts of the seller but rather depended on the fluctuations of the gold market. Similarly, in NOA v. Key Futures, Inc., 638 F.2d 77 (9th Cir. 1980), the court held that no investment contract was created when an investor purchased silver bars pursuant to a contract of purchase in which the seller agreed to repurchase the bars at any time for the price quoted in the Wall Street Journal. The court determined that the profits to the investor depended upon fluctuations of the silver market and not the managerial efforts of the seller.
Canadian Express Club also relies on Energy Group of America, 459 F. Supp. 1234, in which the court held that the EGA did not provide significant efforts which affect the failure or success of the enterprise with the result that an investment contract did not exist. EGA made recommendations to customers regarding which oil and gas leases they should bid on and stood ready to purchase the lease from a customer for the price at which the lease is valued on the monthly listing. In holding that an investment contract was not formed, the court said:
“What primarily affects the failure or success of the enterprise, assuming there is one, is not EGA’s ‘essential managerial efforts,’ . . . but the luck of the draw. The skill of EGA in selecting the recommended parcels has no effect whatsoever unless a customer wins a lease, an occurrence totally outside of EGA’s control. Under the circumstances, EGA’s role in the success of the enterprise, limited as it is to recommending parcels on which to bid, with the rest left to chance, can hardly be said to be essential managerial or entrepreneurial efforts.” 459 F. Supp. at 1240.
These cases are distinguishable in that each buyer purchased an individual gold coin, silver bar, or oil and gas lease after which the enterprise had no further obligation with the exception of the obligation to repurchase the silver bar or oil and gas lease for the market value. In this case, a member of the 6000 group purchases a share in congruence with a number of other investors. The investors expect to receive earnings resulting from the use of their funds. The group of investors depend on Canadian Express Club to purchase 6,000 lottery tickets, keep daily records of the lottery numbers, send each investor a results summary of the group, and disburse any winnings to each investor. Although an element of luck is present, the investors could not participate in the lottery pool without the organization and management of Canadian Express Club.
Investment in the 6000 group may be compared with investment in a mutual fund, which is a security. See Daniel v. Inter. Broth. of Tmstrs., Chauf., Etc., 561 F.2d 1223 (7th Cir. 1977) (A pension fund resembles a mutual fund, both of which are securities.). Mutual fund investors purchase shares in mutual funds with the knowledge that their money will be invested in stocks, bonds, and other investments. The investors anticipate a profit from their investment, but probably realize mutual funds are not risk-free. The fund manager handles the management and record keeping and sends the investors periodic reports with regard to their profits. Similarly, the 6000 club participants purchase shares with the knowledge that their money will be invested in the lottery. The investors anticipate earning a profit but probably realize the lottery is a game of chance. The Canadian Express Club manages the purchase of the lottery tickets, provides record-keeping services, and sends investors their profits.
The profits from investment in the 6000 club come from the efforts of the Canadian Express Club. The elements of an investment contract are present. Accordingly, shares in the 6000 group constitute securities.
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Abbott, C.J.:
This is a direct appeal by Sonja L. Land from her convictions for one count of burglary and one count of misdemeanor theft. Land contends that the trial court erred in giving a jury instruction on accomplice testimony and that the complaint was defective because it was signed by a legal intern.
Land was tried with two codefendants, Jennie Land and Julie Berg.
Land’s truck was observed leaving the abandoned Fairview Nursing Home in Oskaloosa by the son of the owner of the building. The son testified he recognized some of the scrap aluminum in Land’s truck as items from inside the nursing home. The owner also testified that some of the items were from inside the nursing home, although he admitted that break-ins were common and that the items may have been outside of the building. No one actually saw any of the defendants enter the building. When Land’s truck was stopped by a sheriffs deputy, Land told the officer that Jennie and Julie had not been with her when she picked up the items.
All three defendants were tried jointly. At trial, Land was the only defense witness. She testified that she and the two other defendants did drive up to the nursing home, but that they found some items lying in a large trash pile outside of the building. She testified that some items alleged to have come from the nursing home in fact came from other trash piles. She testified that neither she nor the other two defendants ever entered the building.
The trial court gave the following jury instruction without objection:
“An accomplice witness is one who testifies that she was involved in the commission of the crime with which she and the other defendants were charged. You should consider with caution the testimony of an accomplice.”
Land maintains that this instruction prejudiced her and was improper.
Land’s failure to object to the jury instruction at trial alters this court’s standard of review:
“A party may not assign as error the giving or failure to give an instruction unless he objects to the instruction stating the specific grounds for the objection. Absent such objection, an appellate court may reverse only if the trial court’s failure to give [or the giving of] the instruction was clearly erroneous. [Citations omitted.] The failure to give [or the giving of] an instruction is clearly erroneous only if the reviewing court reaches a firm conviction that if the trial error had not occurred there was a real possibility the jury would have returned a different verdict.” State v. DeMoss, 244 Kan. 387, 391-92, 770 P.2d 441 (1989).
The jury instruction given in this case was taken from PIK Crim. 2d 52.18. Generally, this instruction is requested by a defendant when an accomplice has testified against him or her, often in hopes of favorable treatment by the State. The accomplice has motivation to provide testimony that the State wants. The Kansas Supreme Court has said, “When an accomplice testifies, and whether that testimony is corroborated or not, the better practice is for the trial court to give a cautionary instruction. If the instruction is requested and is not given, the result may be error.” State v. Moore, 229 Kan. 73, 80, 622 P.2d 631 (1981).
When the accomplice testimony is favorable to the defendants, the justification for such an instruction may seem to be less than when the testimony is unfavorable. However, in State v. Anthony, 242 Kan. 493, 749 P.2d 37 (1988), the court adopted the minority view that the instruction may still be given under such circumstances. In Anthony, though, the accomplice was not a co-defendant.
A situation similar to Anthony was presented to the United States Supreme Court in Cool v. United States, 409 U.S. 100, 34 L. Ed. 2d 335, 93 S. Ct. 354 (1972). In Cool, the trial court had instructed the jury that it must ignore the favorable testimony of the accomplice unless it believed the testimony to be true beyond a reasonable doubt. The United States Supreme Court held that this impermissibly shifted the burden to the defendant. 409 U.S. at 102-03. In Anthony, the Kansas court said that the United States Supreme Court had “indicated it would have been permissible for the trial court to have simply instructed the jury to view accomplice testimony with caution.” Anthony, 242 Kan. at 500.
Here, however, the testifying accomplice was also a defendant. Thus, as to Land, this instruction directly told the jury to “consider with caution” her testimony.
In Kansas, the PIK committee recommends that, under normal circumstances, no separate instruction should be given on the credibility of a criminal defendant. PIK Grim. 2d. 52.10. In federal court, instructions on the credibility of criminal defendants are sometimes given. 1 Devitt and Blackmar, Federal Jury Practice and Instructions § 17.12 (1977), suggests the following instruction: “A defendant who wishes to testily is a competent witness; and the defendant’s testimony is to be judged in the same way as that of any other witness." This instruction is, on its face at least, favorable to a criminal defendant.
Instructions that do point out the defendant’s motive to lie are upheld in federal courts if the instructions are “balanced.” For instance, in United States v. Hill, 470 F.2d 361 (D.C. Cir. 1972), the trial court had given the following instruction:
“ ‘A defendant is permitted to become a witness in his own behalf.
“ ‘His testimony should not be disbelieved merely because he is the defendant.
“ ‘In weighing his testimony, however, you may consider the fact that the defendant has a vital interest in the outcome of this trial.
“ ‘You should give his testimony such weight as in your judgment it is fairly entitled to receive.’ ” 470 F.2d at 363.
The court upheld the instruction based on Reagan v. United States, 157 U.S. 301, 39 L. Ed. 709, 15 S. Ct. 610 (1895). For further federal cases on jury instructions on a defendant’s credibility, see Annot., 59 A.L.R. Fed. 514.
The constitutional limit on a court’s ability to comment on a defendant’s credibility in a jury instruction seems to be that a court may point out to the jury that a defendant, as an. interested party, has motivation to distort his testimony; however, the instruction must also be neutral or balanced and not single out the defendant as not to be believed.
Several older Kansas cases have considered instructions on defendant’s credibility. In State v. Buffington, 71 Kan. 804, 81 Pac. 465 (1905), the court approved an instruction “ ‘that the defendant is a competent witness in his own behalf, and you have a right to consider his evidence and are to give it such faith and credit as you believe it entitled to receive.’ ” 71 Kan. at 810. The defendant argued that this instruction led the jury to believe it was optional for it to consider his testimony. The court said:
“Although not the best form of expression we do not think that it conveys the idea that the consideration of the defendant’s evidence was optional with the jury, because in the same instruction they were specifically told to give his evidence such faith and credit as they believed it was entitled to receive. The general instruction given as to weighing the evidence in the case makes no exception of his, and it is impossible to think that the jury understood that they could overlook his testimony.” 71 Kan. at 810.
In State v. Killion, 95 Kan. 371, 383, 148 Pac. 643 (1915), the court approved an instruction which told the jury that the defendant was a competent witness; that the fact that he was charged with a crime should not affect his credibility; that his evidence should be considered with all other evidence and circumstances; and that the jury might take into consideration his interest in the case. 95 Kan. at 383. The court said, “The instruction, on the whole, was intended to benefit the defendant, and the last clause was only stating a common rule that the jury have a right, in weighing evidence, to consider the interest of any witness in the case.” 95 Kan. at 383.
It is, then, not error as a matter of law for a trial court in Kansas to give a neutral instruction on a defendant’s credibility, although the wisdom of the practice is certainly questionable. As a matter of common sense, a jury knows that the defendant has an interest in the outcome of the case. Any instruction, even worded favorably to the defendant, seems to call undue attention to his status. As noted above, the PIK Committee recommends that there be no separate instruction on the defendant as a witness. PIK Crim. 2d 52.10. The PIK Committee instructs that PIK Crim. 2d 52.09 on Credibility of Witnesses be given in every criminal case. PIK Crim. 2d 52.09, being a general instruction concerning the credibility of all witnesses, is proper because it does not single out the defendant.
The instruction in this case referred to accomplice testimony. But, Land was testifying both as an accomplice and as a defend ant. In effect, the instruction told the jury to doubt Land’s testimony. The instruction was not neutral. As applied to Land, it arbitrarily singled out her testimony and would cause a jury to scrutinize it differently than other testimony. The instruction was erroneous.
The evidence in this case was largely circumstantial. No one ever actually saw any of the defendants in the building. The owner admitted that the items could have been on a trash pile outside of the building. The entire theory of the defense, and the only testimony for the defense, was based on the fact that the items were outside the building. Thus, the instruction went to the heart of Land’s defense. We are of the opinion that, without the erroneous instruction, there is a real possibility the jury would have returned a different verdict; thus, the giving of the instruction was clearly erroneous.
Land next argues that her convictions should be reversed because the complaint is only signed by a legal intern and not also by an attorney. Land may not maintain this argument on appeal. There was no objection to the complaint at trial. K.S.A. 1989 Supp. 22-3208(3) provides:
“Defenses and objections based on defects in the institution of the prosecution or in the complaint, information or indictment other than that it fails to show jurisdiction in the court or to charge' a crime may be raised only by motion before trial. . . . Failure to present any such defense or objection as herein provided constitutes a waiver thereof, but the court for cause shown may grant relief from the waiver.”
Here, Land suggests no cause for her failure to object at the proper time.
Reversed and remanded with instructions to set aside the verdict and grant the accused a new trial. | [
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Miller, J.:
William McLaren appeals from the refusal of the trial court to allow withdrawal of his guilty plea to one count of felony theft, K.S.A. 21-3701 (Ensley 1981), in case No. 84 CR 501. He also appeals his jury conviction for two counts of sale of marijuana, K.S:A. 1987 Supp. 65-4127b, and the sentence imposed therefor in case No. 87 CR 128. The cases are consolidated on appeal.
McLaren raises four issues:
1. Whether the trial court erred in failing to permit appellant to withdraw his guilty plea;
2. whether the trial court erred in failing to give the jury appellant’s requested instruction on the defense of entrapment;
3. whether the trial court erred in permitting evidence tending to prove appellant’s involvement with drugs on other occasions; and
4. whether during closing argument the prosecutor impermissibly commented upon appellant’s post-arrest silence.
Because we answer the first two issues in the affirmative, we need not reach the latter two.
On August 12, 1985, appellant appeared before the trial court and, pursuant to plea negotiations, entered a plea of guilty to one count of felony theft. The record on the plea shows the following:
“THE COURT: Will the State recite the plea negotiations for the record?
“MISS WILKINSON: Defendant will be pleading to the crime as charged, we will be recommending probation and payment of restitution and I am leaving it up to the discretion of the Court what of the transportation expense to assess.
“THE COURT: You understand that you are charged with a Class D felony? “MISS WILKINSON: We would be willing to amend that charge to a Class E felony. Technically, at the time the crime was committed that was a— theft was a D but now it’s an E.
“THE COURT: You understand, Mr. McLaren, you are now charged with a Class E felony and if convicted of a Class E felony you could be sentenced to serve a minimum term of one year and a maximum term of three to five years and you may be ordered to pay a fine in lieu of such sentence or in addition to the sentence in an amount not to exceed $10,000?”
After accepting the plea, the court imposed a sentence of one to two years and placed the appellant on probation. At the time of the commission of the offense, felony theft was a class D felony. K.S.A. 21-3701 (Ensley 1981). Between January of 1984 when the theft was committed and the time of appellant’s plea, the statute was amended to make felony theft a class E felony. L. 1984, ch. 119, § 2. The effective date of the amendment was May 17, 1984, and the amendment specifically applied prospectively only. The State did attempt to amend the classification of the charge to an E felony and, as pointed out by the sentencing journal entry, the court apparently accepted that amendment and sentenced defendant accordingly.
Because the trial court was without authority to reduce the classification of felony theft, the sentence imposed was illegal. “It has long been the rule in this state that the crime and penalty in existence at the time of the offense are controlling unless the legislature has given retroactive effect to any statutory chánges made subsequent to the time of the commission of the crime.” State v. Van Cleave, 239 Kan. 117, 122, 716 P.2d 580 (1986).
Prior to the expiration of his probationary period, the State filed a motion to revoke appellant’s probation, based in part upon the activity which led to his convictions in case No. 87 CR 128. On May 27, 1988, the trial court heard the State’s motion, revoked appellant’s probation, and ordered his incarceration under the original one- to two-year term. After notification by the Department of Corrections that the original sentence was improper, the trial court, on September'9, 1988, by order nunc pro tunc, modified appellant’s sentence to one to five years. Appellant objected to the' nunc pro tunc order and the matter was set for hearing on January 13, 1989, at which time appellant sought to withdraw his guilty plea, claiming that the plea bargain was based upon an agreement that the court impose an illegal sentence. The motion to withdraw the plea was denied, and appellant brought this appeal.
All of this is significant because during the period appellant was on probation he was charged with and convicted of two counts of selling marijuana in case No. 87 CR 128. On May 27, 1988, the same day appellant’s probation was revoked, appellant was sentenced to three to ten years on Count I of 87 CR 128 and seven to twenty years on Count II, the sentence having been enhanced pursuant to the Habitual Criminal Act based upon the conviction in case No. 84 CR 501.
Appellant now contends that, if he is allowed to withdraw his plea in 84 CR 501, the enhanced sentence in Count II of 87 CR 128 must also fail, as there would be no underlying felony conviction to serve as its basis.
The issue before this court, whether appellant should be allowed to' withdraw his plea of guilty becausé the plea negotiation which induced the plea was apparently based upon a promise to recommend an illegal sentence, is one of first impression in Kansas. Our courts have spoken to various other issues relating to plea bargains, all of which issues have as their genesis Santobello v. New York, 404 U.S. 257, 30 L. Ed. 2d 427, 92 S. Ct. 495 (1971). That case stands for the proposition that the prosecution may not renege on promises made in the course of plea negotiations. Appellant, in his brief, places much reliance on State v. Wills, 244 Kan. 62, 765 P.2d 1114 (1988), which suggests that ambiguous plea agreements must be construed in favor of the defendant. While the plea negotiations here are indeed ambiguous in that it is unclear from the record whether the decision to reduce the sentence to one applicable to an E felony was part of the agreement itself, or simply a gratuitous act on the part of the prosecution, Wills does not answer the question presented. Even if we follow Wills and construe the agreement to be that the prosecution induced appellant’s plea with the promise of an. illegal sentence, the question remains as to what remedy should be available to appellant.
The State contends that the remedy chosen by the trial court, that of resentencing to the minimum sentence applicable to a D felony, is sufficient in that the State agreed to and did recommend probation, which was granted by the court. Appellant, on the other hand, claims he should be entitled to withdraw his plea.
Support for appellant’s position is found in Chae v. People, 780 P.2d 481 (Colo. 1989), a case brought to our attention during Oral argument by the attorney for the State. In that case a defendant who was convicted on his plea of guilty to second-degree sexual assault filed a motion to vacate his plea, claiming that his plea was not knowingly or voluntarily made because he had been unaware of the impact of certain aspects of the plea agreement. The Colorado Supreme Court determined that the original sentence handed down by the trial court was illegal and ultimately concluded that when a defendant enters into a plea agreement that includes as a material element a recommendation for an illegal sentence and the illegal sentence is in fact imposed on the defendant, the guilty plea is invalid and must be vacated because the basis on which the defendant entered the plea included the impermissible inducement of an illegal sentence. 780 P.2d at 486-87.
Construing the plea agreement as we do in favor of appellant, we find part of the inducement to be the promise of an illegal sentence. We conclude the logic of Chae is sound; thus, we find the trial court erred in failing to set aside the conviction and in failing to allow the appellant to withdraw his plea.
Turning now to appellant’s second issue, that of whether the trial court erred in failing to give an entrapment instruction, we find the law regarding instructions well stated in State v. Hunter, 241 Kan. 629, 740 P.2d 559 (1987):
“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.” 241 Kan. at 644. “[A] defendant is entitled to an instruction on his or her theory of the case even though the evidence is slight and supported only by defendant’s own testimony.” 241 Kan. at 646.
The evidence in the record was sufficient to justify the giving of an instruction on entrapment. Both the appellant and the State’s undercover agent testified that it was the agent who originally conceived the idea that appellant sell marijuana to her. In the second transaction, the agent once again asked appellant to sell marijuana to her. Appellant testified the only reason he sold marijuana to the State’s agent was because she begged and pleaded with him to sell her marijuana. He testified that the sale was without profit to him and was done as an accommodation to a person he believed was to marry his friend Chopper. Though the State presented a notebook containing the appellant’s handwritten notes referring to numerous prior drug transactions in an attempt to establish appellant’s predisposition to sell drugs, appellant offered the explanation that the notes referred to drug transactions of a third person in which he was not involved, and that he only kept records for that person. It is not the function of this court to weigh the evidence or determine the credibility of the parties. Rather, we are to judge whether sufficient evidence existed in the record to justify giving the requested instruction. We believe the record contains such evidence and find that it was error on the part of the trial court to fail to give the instruction.
The judgment in case No. 84 CR 501 is reversed and the case is remanded to allow the appellant to withdraw his plea of guilty and for further proceedings consistent with such withdrawal.
The judgment in case No. 87 CR 128 is reversed and the case is remanded to give the defendant a new trial. | [
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Davis, J.:
Dennis Shepherd appeals the dismissal of his habeas corpus petition for failure to state a claim upon which relief can be granted. We reverse and remand for further hearing.
While Shepherd was an inmate incarcerated at Hutchinson Correctional Work facility (HCWF), there was a search of the inmates’ living quarters. When Shepherd’s closet was searched, a key assigned to the closet of another inmate, Billy Jones, was found. Upon a search of Jones’ closet, the guards found five gallons of homemade alcohol and an amount of sugar.
Shepherd was charged with violations of K.A.R. 44-12-201, possession of unauthorized and unregistered personal property, and K.A.R. 44-12-1101, conspiracy to violate another rule, specifically K.A.R. 44-12-901, possession of dangerous contraband. He entered a plea of not guilty. Shepherd requested that two inmates, Billy Jones and Terry Garrison, be allowed to testify in his behalf. An administrative hearing was held and only Garrison was allowed to testify for Shepherd. Shepherd was not given any reason why Jones was not allowed to testify.
Shepherd was found guilty of both charges and sentenced to seven days’ disciplinary segregation on each offense, for a total of fourteen days of segregation. He was also transferred from HCWF, a medium security facility, to Kansas State Industrial Reformatory (KSIR), a maximum security facility, and received a deduction in pay status and classification custody level.
After exhausting administrative remedies, Shepherd filed his petition alleging (1) that his due process rights were violated because of the hearing board’s refusal to allow an essential witness at his hearing; (2) that his conviction is not supported by the evidence; and (3) that he was not provided with a sufficient statement of the evidence and reasoning relied on by the hearing board.
Standard of Review
A petition may be dismissed under K.S.A. 60-212(b)(6) for failure to state a claim when it appears “beyond doubt” petitioner can prove no set of facts which would entitle him to relief. Jones v. Marquez, 526 F. Supp. 871, 874 (D. Kan. 1981). See Keith v. Schiefen-Stockham Insurance Agency, Inc., 209 Kan. 537, 540, 498 P.2d 265 (1972). All allegations in the petition must be taken as true and “ ‘[t]he question for determination is whether in the light most favorable to plaintiff, and with every doubt resolved in plaintiffs favor, the petition states any valid claim for relief.’ ” Keith, 209 Kan. at 540.
Habeas corpus is an appropriate remedy where an inmate attacks the conditions of his confinement, and his treatment by the institution clearly infringes upon his constitutional rights, yet relief via K.S.A. 60-1507 would be inadequate. See In re Habeas Corpus Application of Gilchrist, 238 Kan. 202, 205, 708 P.2d 977 (1985); Levier v. State, 209 Kan. 442, 449-50, 497 P.2d 265 (1972); K.S.A. 60-1507(e).
Shepherd alleges his constitutional due process liberty interests under the Fourteenth Amendment were violated by actions of prison authorities in his disciplinary proceedings. “Liberty interests protected by the Fourteenth Amendment may arise from two sources — the Due Process Clause itself and the laws of the States.” Hewitt v. Helms, 459 U.S. 460, 466, 74 L. Ed. 2d 675, 103 S. Ct. 864 (1983). The due process clause itself does not grant a prisoner the right to be free from segregation. See Hewitt, 459 U.S. at 468. The State can, however, create a liberty interest protected through the due process clause by its enactment of certain statutory or regulatory measures. Hewitt, 459 U.S. at 469.
Shepherd does not specify the source of his claimed liberty interest, but the provisions of the Kansas Administrative Regulations, Articles 12 and 13, create a state law liberty interest in disciplinary proceedings where, as here, disciplinary segregation is imposed as a punishment. The Kansas regulations make it clear that disciplinary confinement may not occur absent specified substantive predicates. See Hewitt, 459 U.S. at 472.
In Wolff v. McDonnell, 418 U.S. 539, 41 L. Ed. 2d 935, 94 S. Ct. 2963 (1974), the United States Supreme Court held that due process imposes certain minimal procedural requirements which must be met in a prison disciplinary hearing when the State has, by statute or regulation, provided substantive rights regarding those hearings. Wolff, 418 U.S. at 557-58.
1. Right to Witnesses
Shepherd argues that his constitutional rights were violated when the disciplinary board refused to allow Jones’ testimony, either in person or by phone or affidavit, and refused to provide any justification for this decision. The Kansas Administrative Regulations involving this question provide:
“Subject to the limitations and guidelines set out in these regulations and subject to the control of the hearing officer or board chairperson exercised within the parameters of the law and these regulations, the inmate shall be entitled:
“(5) to have witnesses called to testify on the inmate’s behalf.” K.A.R. 44-13-101(d)(5).
“The request for the witness may be denied ... if the testimony relates to something already disposed of, if it is clearly irrelevant or immaterial, if it is repetitious of other testimony, or for reasons specified in K.A.R. 44-13-405a.” K.A.R. 44-13-405(g).
K.A.R. 44-13-405a allows the hearing officer or board to balance the inmate’s interest against thirteen specified needs of the prison in making a decision whether to allow an inmate to call a witness from within the prison population or its employees. The hearing officer or board is granted “broad discretion” in making this de cisión. K.A.R. 44-13-405a(b). K.A.R. 44-13-405a(g) requires written explanation be made on the record where the request to call a witness is denied, unless some person would be endangered thereby.
Wolff provides that “the inmate facing disciplinary proceedings should be allowed to call witnesses and present documentary evidence in his defense when permitting him to do so will not be unduly hazardous to institutional safety or correctional goals.” 418 U.S. at 566. The Wolff Court held that when a witness is disallowed, “[although we do not prescribe it, it would be useful for the Committee to state its reason.” 418 U.S. at 566.
Later, in Ponte v. Real, 471 U.S. 491, 85 L. Ed. 2d 553, 105 S. Ct. 2192 (1985), the Court held prison officials are required, when challenged, to justify why witnesses were not allowed to testify, either by making the explanation part of the administrative record of the disciplinary proceeding or by presenting testimony in court later when the decision is challenged. 471 U.S. at 497. “[S]o long as the reasons are logically related to preventing undue hazards to ‘institutional safety or correctional goals,’ the explanation should meet the due process requirements.” 471 U.S. at 497.
In his concurring opinion in Ponte, Justice Stevens (joined in part by Justice Blackmun) made it clear that “even if the reason for the refusal is not recorded contemporaneously, it must exist at the time the decision is made” (rather than be merely an attempt to contrive some post-hoc rationale to justify what was an arbitrary decision). 471 U.S. at 503-04. The burden of proof is on prison officials to show their decision was not arbitrary, rather than on the inmate to show it was. 471 U.S. at 504. Prison officials may not arbitrarily deny an inmate’s request to present a witness. Malek v. Camp, 822 F.2d 812, 815 (8th Cir. 1987).
No rationale was ever provided by prison officials for their decision to deny Shepherd his requested witness. Although counsel for respondents has advanced some possible reasons for the prison officials’ decision, such post-hoc hypothesizing does not allow this court to determine whether the prison officials’ decision was actually based on these reasons or was purely arbitrary. Even if the decision was based on factors permitted under K.A.R. 44-13-405a(a) and (e), these factors may not meet constitutional due process requirements in this case. Petitioner states a substantial due process claim in his first issue which may not be dismissed without a hearing.
2. Insufficiency of the Evidence
In Superintendent v. Hill, 472 U.S. 445, 86 L. Ed. 2d 356, 105 S. Ct. 2768 (1985), the Supreme Court held that the findings of a disciplinary board violate due process unless supported by “some evidence” in the record. 472 U.S. at 454. “Ascertaining whether this standard is satisfied does not require examination of the entire record, independent assessment of the credibility of witnesses, or weighing of the evidence.” 472 U.S. at 455; see also Williams v. Maschner, 10 Kan. App. 2d 79, 81, 691 P.2d 1329 (1984) (findings must be supported by substantial competent evidence).
The disciplinary report and testimony of Sergeant Eugler provide the only evidence on the conspiracy charge against Shepherd: “[Wjhile shaking down cube 276, I found a key which is assigned to cube 268. Cube 268 belongs to inmate Jones 47998. Officers Corbus, Peters, and Bunker then shook down cube 268 where they found approximately 5 Gal’s of Hootch and sugar thus resulting in the 44-12-1101 against I.M. Shepherd.”
K.A.R. 44-12-1101(b) defines conspiracy as “an agreement with another person to commit an offense or to assist in committing an offense. No inmate may be convicted of a conspiracy unless an overt act furthering that conspiracy is alleged and proved to have been committed by the inmate, or by a co-conspirator.” Shepherd was charged with having conspired with Jones to violate K.A.R. 44-12-901, which makes it a violation to “possess, hold, sell, transfer, receive, control, distribute, or solicit any dangerous contraband.” The homemade alcohol is dangerous contraband under K.A.R. 44-12-901(a)(4), which incorporates K.S.A. 21-3826, defining “alcoholic liquor” or “intoxicating beverage” as contraband.
The record appears to contain no evidence of an agreement between Shepherd and Jones to commit the violation charged. “ ‘[A] conspiracy to commit a crime is not established by mere association or knowledge of acts of the other parties. There must be some intentional participation in the conspiracy with a view to the furtherance of the common design and purpose.’ ” State v. Rider, Edens & Lemons, 229 Kan. 394, 405, 625 P.2d 425 (1981). Petitioner’s contention regarding insufficiency of evidence states a claim that may not be dismissed without a hearing.
3. Sufficiency of the Statement of the Evidence Relied Upon and of the Reasoning of the Board
K.A.R. 44-13-503(a) requires that a summary written record of the disciplinary hearing be made which “shall state specifically what evidence was relied upon. . . . The record shall also include a summary statement of the reasons for the disciplinary action and, for this purpose, the disciplinary report may be incorporated by reference ... so long as the disciplinary report . . . adequately shows the reason for the disciplinary action.” In this case, the disciplinary board sets forth its reasons in one sentence: “Guilty due to testimony was clear and convincing.”
In Wolff, the court held one due process requirement of disciplinary proceedings to be “a written statement of the factfinders as to the evidence relied upon and the reasons for the disciplinary action taken.” 418 U.S. at 563. “Written records of proceedings will . . . protect the inmate against collateral consequences based on a misunderstanding of the nature of the original proceeding” and insure that administrators, faced by possible court scrutiny, will act fairly. 418 U.S. at 565.
Although the United States Supreme Court has offered little guidance, other courts have held that, while the statement of reasons may be brief and need not reach the complexity or length of judicial findings of fact and conclusions of law or analyze every argument raised, it must at least be sufficient to show on review that the decision was not arbitrarily reached and to protect against collateral consequences. Pino v. Dalsheim, 605 F. Supp. 1305, 1316 (S.D.N.Y. 1984); Ivey v. Wilson, 577 F. Supp. 169, 172-73, (W.D. Ky. 1983). See also Culbert v. Young, 834 F.2d 624, 631 (7th Cir. 1987) (statements that will satisfy due process will vary from case to case depending on severity of the charges and complexity of the facts and proof necessary); Saenz v. Young, 811 F.2d 1172, 1174 (7th Cir. 1987) (where the charge is complex [using a charge of conspiracy as an example] a mere conclusion that the prisoner is guilty in a complex case will not satisfy the due process requirement); Robinson v. Young, 674 F. Supp. 1356, 1368 (W.D. Wis. 1987) (an adequate statement of reasons “must ‘[point] out the essential facts upon which inferences were based’ [citation omitted], ‘mention what evidence the reporting officer relied on’ and give a ‘clear indication of why the reporting officer was to be believed rather than the [inmate or other witnesses]’ ”); Craig v. Franke, 478 F. Supp. 19, 21 (E.D. Wis. 1979) (plaintiff inmate is entitled to a more satisfactory statement of reasons than “Guilty. 3-Days Adjustment Seg.”)
Petitioner’s third issue presents a substantial due process claim which may not be dismissed without a hearing.
On Remand
Petitioner seeks a transfer back from a maximum to a medium security facility. The United States Supreme Court has held the due process clause does not, in and of itself, mandate a hearing for intrastate (or interstate) transfers of state prisoners, for either administrative or disciplinary reasons. Olim v. Wakinekona, 461 U.S. 238, 244-45, 75 L. Ed. 2d 813, 103 S. Ct. 1741 (1983); Meachum v. Fano, 427 U.S. 215, 225, 49 L. Ed. 2d 451, 96 S. Ct. 2532 (1976). There is no liberty interest involved then, absent some state law conditioning transfer on proof of serious misconduct. Meachum, 427 U.S. at 216. Shepherd has pointed to no statute which would create such an interest, and we are unable to discover any basis for a state-created liberty interest regarding disciplinary transfer. Cf. Jones v. Marquez, 526 F. Supp. at 875 (Kansas administrative segregation regulations create liberty interest for due process purposes). Transfer is not one of the penalties authorized for rules violations under the Kansas regulations. The regulations do not impose certain requirements before transfer may take place. Shepherd’s claim is based on due process rights and no due process liberty interest has been implicated so the requested remedy of re-transfer is not available.
The above conclusion does not mean the petitioner is without remedy. Although Shepherd has served his disciplinary sentence, a potential for harm still remains because the disciplinary record may be relied upon in making future decisions concerning his privileges. The equitable remedy of expunction is available where an inmate has been denied procedural due process during, insti tutional disciplinary hearings. Dedrick v. Wattman, 617 F. Supp. 178, 184 (S.D. Iowa 1985).
Based on the record before us, we find the district court erred in its decision to dismiss the petition for failure to state a claim.
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Briscoe, J.;
Defendant Peat Marwick and Main (Peat Marwick) appeals a jury verdict awarding plaintiff Richard Bick $170,250 in an accounting malpractice case. Our reference throughout this opinion to Peat Marwick will also encompass its predecessor corporation, which merged with Peat Marwick in 1987.
In 1981, Bick resigned his position as president of Koch Exploration. As part of the resignation package, he was entitled to ten annual payments of $84,461 from the Koch Industries shadow stock program and was required to sell Koch his shares of common stock. Upon the advice of Alvin Marcus, a partner with Peat Marwick, Bick sold the stock in October 1981 and received $884,115 for the common stock and $84,461 from the shadow stock program.
In late December, Peat Marwick prepared fourth quarter estimated tax payments for Bick totalling $249,065, which Bick paid. In early 1982, Peat Marwick prepared Bick’s 1981 tax returns but did not include the sale of the common stock or the shadow stock payment. As a result, Bick received a tax refund of $194,793.
In 1986, the IRS audited the Koch Industries shadow stock program. Peat Marwick discovered the error in Bick’s 1981 tax returns and prepared amended returns. On August 15, 1986, Bick filed the amended returns, paying additional tax of $227,588 and statutory interest totalling $170,662. Bick received a “30-day letter” from the IRS dated March 2, 1987, proposing imposition of a negligence penalty pursuant to I.R.C. § 6653(a) (1986). On November 3, 1987, the IRS issued a Notice of Deficiency to Bick assessing negligence penalties in the amount of $29,600.40. Bick filed a formal protest but ultimately conceded the negligence penalties.
On February 19, 1988, Bick filed this case against Peat Mar-wick, alleging accounting malpractice. The jury found Peat Mar-wick to be 75 percent at fault. The jury also found Bick did not know or should not have known of the omission in his 1981 tax returns before February 18, 1986, the date Peat Marwick discovered the omission and reported it to Bick.
Peat Marwick raises three issues: (1) Whether Bick’s action is barred by the statute of limitations; (2) whether Bick can recover a negligence penalty from a defendant tax preparer; and (3) whether the court erred in prohibiting evidence of Bick’s prior conviction.
1. Statute of Limitations
K.S.A. 1989 Supp. 60-513(a)(4) provides a two-year statute of limitations for a cause of action alleging negligence. Subsection (b) states the Kansas discovery rule:
“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.”
Peat Marwick relies on both prongs of 60-513(b). First, it contends Bick’s negligence cause of action accrued on April 16, 1982, because he suffered substantial injury at that point. Second, it argues Bick’s injury was reasonably ascertainable when he signed his tax returns on April 15, 1982. It contends Bick should have known as a matter of law that Peat Marwick was negligent in preparing the tax returns on April 15, 1982, and that he, was injured and had an actionable claim on April 16 when the statutory, interest penalty began accruing. . ....
Peat Marwick cites Roe v. Diefendorf, 236 Kan. 218, 689 P.2d 855 (1984), for the proposition that Bick incurred an actionable injury on April 16. In Roe, plaintiff sued Diefendorf for negligently driving her car into his motorcycle. Diefendorf. argued the two-year statute of limitations had run because; Roe filed ,the petition more than two years after the. accident. The trial court; accepted Roe’s argument that the statute of limitations was tblled because his doctor did not detect, a significant injury until over one year after the accident. The Supreme Court reversed; statipg it is the discovery of the fact of injury rather than the extent of injury that begins the statute of limitations running, The issue in Roe was whether 60-513(b) requires the injured party to know the extent of the injury before the statutory time limitation begins running. In the present case, the issue is not whether Bick knew the extent of his injury prior to February 18; 1986-. The issue is whether he knew or had reason- to know he had been injured at; all. Roe is therefore distinguishable from the present case.
Peat Marwick cites Knight v. Myers, 12 Kan., App. 2d. 469 748 P.2d 896 (1988), for the proposition that Bick should have known of the injury “as a matter of law.” Knight was a legal malpractice- case in which plaintiffs sued their attorney, alleging he failed to advise them that their cause.of action in the underlying case was subject to a statute of-limitations. The trial court ruled their action was time barred and this court agreed. Applying the discovery rulé set forth in Pancake House, Inc. v. Redmond, 239 Kan. 83, 87, 716 P.2d 575 (1986), the court held the plaintiffs’ cause of action accrued when-they reasonábly should'have discovered the material facts necessary to prove their‘claim. They suffered actionable injury when the statute of limitations in the underlying case ran. The court then ruled'plaintiffs' had Constructive knowledge of the statute of limitations because “[e]veryohe is presumed to know the law.” Knight, 12 Kan. App. 2d at 475. Thus, the legal malpractice claim filed more than two years after this constructive knowledge of the injury was timé barred.
Peat Marwick contends Bick should be charged with constructive knowledge of I.R.C. § 6601(a) (1986). That code section provides for daily accrual of interest applied to income tax underpayments. The interest begins to accrue on the date the tax return and payment are due. Peat Marwick contends that, under Knight, the court must hold as a matter of law that Bick’s first substantial injury (the accruing of an interest penalty on April 16, 1982) was reasonably ascertainable on April 15 because Bick constructively knew the provisions of § 6601(a). This contention is not persuasive. A taxpayer’s constructive knowledge that potential interest can be assessed on underpayment of income tax does not equate to knowledge of the negligent act that would trigger the taxpayer’s liability for interest.
Here, the jury was asked:
"Do you find that plaintiff knew, or reasonably should have known any time before February 18, 1986, that his 1981 income tax return did not include sums received bv him from Koch Exploration that he received in 1981?”
The jury responded: “No.” Special interrogatories are permitted in Kansas and the decision to submit them to the jury rests in the sound discretion of the trial court. K.S.A. 60-249(b); Schaeffer v. Kansas Dept. of Transportation, 227 Kan. 509, 520, 608 P.2d 1309 (1980). Further, failure to object to the special question precludes appellate review. See Hall v. High, 214 Kan. 489, 490, 520 P.2d 1283 (1974). In the present case, Peat Marwick failed to object to the special interrogatory but, on appeal, asks this court to disregard as a matter of law the interrogatory and the jury’s response to it.
Where there is evidence in dispute as to when the plain tiff s injury first became reasonably ascertainable, the question is one for the trier of fact. Uhock v. Sleitweiler, 13 Kan. App. 2d 621, 623, 778 P.2d 359 (1988). The standard of review of findings of fact is well established. The reviewing court must determine if the findings are supported by substantial competent evidence and are sufficient to support the trial court’s conclusions of law. The appellate court must accept as true the evidence and all inferences to be drawn from the evidence which support the findings of the jury. Army Nat’l Bank v. Equity Developers, Inc., 245 Kan. 3, 19-20, 774 P.2d 919 (1989).
The jury found Bick did not know and had no reason to know Peat Marwick failed to include the stock sale and shadow stock payment in his 1981 tax returns prior to February 18, 1986. The evidence shows Bick contacted Peat Marwick in late summer of 1981 and asked for advice. Peat Marwick told him to sell the stock in 1981 and billed Bick for that advice. He sold the stock in October and Peat Marwick prepared fourth quarter estimated tax payments to reflect the income. Bick paid the estimated tax and Peat Marwick’s bill for the services. At Peat Marwick’s request, Bick then prepared a listing of the rest of his income and expenses for 1981. Bick stated he did not include the income from the stock sale or the shadow stock payment in this listing because Peat Marwick already had that information. Peat Marwick prepared the 1981 tax returns based on Bick’s list and sent the returns to Bick to sign and file. Bick noted a Peat Marwick partner had signed the returns and relied on his expertise.
Peat Marwick continued to do Bick’s tax work until 1986. It was not until July 1986 that Bick was told of the omission in his 1981 tax returns. As a matter of fact, in December 1983, the IRS assessed additional tax of $796.66 on Bick’s 1981 return after an audit of automobile use at Koch and the omission at issue here was not then discovered. There was substantial competent evidence to support the jury’s finding that Bick did not know and had no reason to know of the omission prior to February 18, 1986.
Peat Marwick also contends Bick’s stipulation to the taxpayer negligence penalty establishes as a matter of law that Bick knew or had reason to know of the omission on April 15, 1982. The argument is that, by stipulating to the penalty, Bick is estopped from denying he had reason to know of the omission on April 15, 1982. We disagree. Stipulations in tax court cannot be used against any party in any other case or proceeding. Tax Ct. R. 91(e), 24A Federal Tax Coordinator 2d 52,582 (1990). Further, in Kansas, a plea of collateral estoppel may be asserted only by a person who was a party or in privity with a party to the prior action. McDermott v. Kansas Public Serv. Co., 238 Kan. 462, 473, 712 P.2d 1199 (1986). Bick is not estopped from denying he had reason to know of the omission on April 15, 1982, because he conceded the taxpayer negligence penalty issue in a different proceeding.
Peat Marwick argues the court’s instruction to the jury requiring it to find Bick at least one percent at fault because of his stipulation in tax court to the taxpayer negligence penalty establishes as a matter of law that Bick knew or had reason to know of the omission on April 15, 1982. This instruction is in direct conflict with the nonbinding provision of Tax Court Rule 91(e) and the doctrine of collateral estoppel, and is, therefore, erroneous on its face. Bick has not filed a cross-appeal on this issue; thus, the instruction does not constitute reversible error. See Pilcher v. Board of Wyandotte County Comm’rs, 14 Kan. App. 2d 206, 213, 787 P.2d 1204 (1990) (errors injury instructions are not reversible errors unless they prejudice the appealing party). However, Bick’s failure to appeal the issue does not render the instruction valid and does not establish as a matter of law that Bick knew or had reason to know of the omission when the tax returns were filed.
Bick argues the statute of limitations should not commence until a negligence penalty is assessed. Bick cites a number of other jurisdictions in support of his contention. Moonie v. Lynch, 256 Cal. App. 2d 361, 64 Cal. Rptr. 55 (1967); Feldman v. Granger, 255 Md. 288, 257 A.2d 421 (1969); Snipes v. Jackson, 69 N.C. App. 64, 316 S.E.2d 657 (1984); Chisholm v. Scott, 86 N.M. 707, 526 P.2d 1300 (1974). Further, Bick argues that, until he is assessed a tax penalty, he has not sustained an injury and is not obligated to file an action until liability is established. This contention has merit.
To recover a negligence claim, the plaintiff must show a causal connection between the duty breached and the injury received, and the plaintiff must show he was damaged by the negligence. Hammig v. Ford, 246 Kan. 70, 73, 785 P.2d 977 (1990). Negligence which does not result in injury forms no basis for a damage action. Garrison v. Hamil, 176 Kan. 548, 551, 271 P.2d 307 (1954). Prior to assessment of a negligence penalty, the plaintiff cannot be injured and therefore has no cause of action. If the plaintiff commences the action prior to the date of assessment, the defendant can properly contend the action is premature. This rule is consistent with Kansas case law.
In Price, Administrator v. Holmes, 198 Kan. 100, 422 P.2d 976 (1967), plaintiff sued for faulty execution of a will. Defendant was a banker who held himself out as an expert in the drafting and execution of wills. Plaintiff was the administrator for the estate of the beneficiary of a man who had defendant prepare and supervise the execution of his will. The will was declared invalid, and plaintiff filed suit within two years of that decision. The court held the statute of limitations commenced to run when the will was found invalid because plaintiff suffered no damages until that point.
In Keith v. Schiefen-Stockham Insurance Agency, Inc., 209 Kan. 537, 498 P.2d 265 (1972), plaintiffs were the survivors of two deceased employees of an employer that did not have workers compensation insurance. Defendant insurance agent had falsely informed the employer it had coverage. Plaintiffs unsuccessfully sought workers compensation benefits and then filed suit. The Kansas Supreme Court held the case was controlled by Price. As in Price, plaintiffs were prevented from suing before resolution of the prior suit because they suffered no damages until they were denied workers compensation benefits.
In Webb v. Pomeroy, 8 Kan. App, 2d 246, 655 P.2d 465 (1982), rev. denied 232 Kan. 876 (1983), defendant falsely represented himself as an attorney and arranged to transfer plaintiffs’ land to a third party with the right to repurchase by plaintiffs. After a lawsuit quieted title in the third parties, plaintiffs sued defendant for legal malpractice. The court held the cause of action accrued after resolution of the quiet title action because plaintiffs were not damaged until they lost their interest in the land.
Bick could not commence his action ágairist Peat Marwick until he had been damaged by its negligent conduct. Assessment of the negligence penalty is the essential factor completing the wrong and the statute of limitations cannot commence until the tort complained of is completed. In this case, Bick was not dámaged by payment of the tax deficiency and interest accrued because thése monies were already owed to the IRS. Bipk was not damaged by his tax preparer’s malpractice until such timé as the negligence penalty was assessed. Bick did not suffer substantial injury üntil he was assessed a negligence penalty on November 3, 1987. Bick’s action was filed well within the two-year statute of limitations. .
2. Negligence Penalty
Peat Marwick contends the trial court erred in allowing an award of damages for assessment of the negligence penalty by the IRS. First, it árgués Bick’s negligence was the sole cause of the penalty as a matter of law. Second, it contends an award of damages for civil penalties incurred contravenes public policy.
The trial court instructed the jury to consider damages as to specific items and the verdict form listed the negligence penalty as one item of damage. Peat Marwick did not object and, thus, appellate review is precluded unless the instruction was clearly erroneous. K.S.A. 60-251(b); Pilcher, 14 Kan. App. 2d at 213.
I.R.C. § 6653(a) (1986) provides:
“(1) In general. — If any part of any underpayment ... is due to negligence or intentional disregard of rules or regulations (but without intent to defraud), there shall be added to the tax an amount equal to 5 percent of the underpayment. -• , ;
“(2) Additional amount for portion attributable to negligence, etc. — There shall be added to the tax ... an amount equal to 50 percent of the interest payable under section 6601 —
“(A) with respect to the portion of the underpayment described in paragraph (1) which is attributable to the negligénce or intentional disregard referred to in paragraph (1), and
“(B) for the period beginning on the last date prescribed by law for payment of. such underpayment . . . and ending on the date ,of the assessment of the tax.”
This section permits assessment of a penalty whenever an underpayment “is due to negligence or intentional disregard of ruléis or regulations.” I.R.C. § 6653(a)(1). Negligence is determined by the reasonable, prudent person standard (Zmuda v. C.I.R., 731 F.2d 1417, 1422 [9th Cir. 1984]), with the taxpayer bearing the burden of establishing that assessment of the penalty was erroneous (Hall v. C.I.R., 729 F. 2d 632, 635 [9th Cir. 1984]). The statute , does not state whose negligence causes the assessment nor does it provide for a comparison of fault. Peat Marwick contends it is only the taxpayer’s negligence which is considered in assessing the penalty.
The United States' Supreme Court has held that, while hiring an attorney or accountant does not insulate the taxpayer from negligence penalties, the taxpayer’s good faith reliance on professional advice may resolve the matter between the IRS and the taxpayer. United States v. Boyle, 469 U.S. 241, 250-51, 83 L. Ed. 2d 622, 105 S. Ct. 687 (1985). Thus, an independent negligence action is not necessarily precluded by the statute.
Our research has revealed no cases dealing with the issue of a claim of indemnification for penalties assessed pursuant to § 6653(a). However, in cases involving penalties assessed pursuant to § 6672, a code section dealing with willful failure to collect or pay over withholding taxes, the federal courts have split on whether the law permits a claim of indemnification. Several courts hold there is no federal right of indemnification under § 6672 and, in the absence of specific statutory authority, there is no federal common-law right of indemnification. Sinder v. United States, 655 F.2d 729 (6th Cir. 1981); Rice v. Pearce, 574 F. Supp. 23 (S.D. Iowa 1983). None of these cases considered whether such a right can arise under state law. One case held public policy militates against allowing a right of indemnification to someone who has acted willfully. Rebelle v. United States, 588 F. Supp. 49, 51 (M.D. La. 1984). That court did state it is at least possible a claim for indemnification may be made by one liable for penalties under § 6653, however. 588 F. Supp. at 52 n.5. Finally, two courts stated, as long as the claim for indemnification is brought in a subsequent proceeding separate from the penalty action, a claim for indemnification is permissible. Schoot v. United States, 664 F. Supp. 293, 298 (N.D. Ill. 1987); Swift v. Levesque, 614 F. Supp. 172, 177 (D. Conn. 1985). From this research, it appears the majority of the federal courts would permit a separate negligence action for indemnification for penalties assessed under § 6653(a), to the extent it is allowed under state law. The issue then is whether Kansas law permits a claim for indemnification in this situation.
In Kansas, claims of indemnity are allowed when a contract of indemnity is implied. The claim usually arises when one party without fault is compelled to pay for the tortious acts of another. The indemnitee has a right of action against the indemnitor. See Haysville U.S.D. No. 261 v. GAF Corp., 233 Kan. 635, 642, 666 P.2d 192 (1983). Furthermore, comparative implied indemnity applies when one party settles the plaintiff s entire claim without participation from the other tortfeasor. This total settlement creates an equitable claim for recovery of the other tortfeasor’s proportionate fault share of the settlement amount. See Kennedy v. City of Sawyer, 228 Kan. 439, 460, 618 P.2d 788 (1980). The doctrine of implied indemnity is particularly applicable in cases of liability of a principal in respondeat superior for the acts of an agent or employee. Kennedy, 228 Kan. at 455. Thus, if Bick has discharged a duty which is owed by him, but which as between himself and Peat Marwick should have been at least in part discharged by Peat Marwick, his claim of implied indemnity is valid. The central issue is whether Peat Marwick’s negligent act is a proximate cause of the imposition of the negligence penalty.
Peat Marwick contends Bick could not have discharged a liability owed by it because Bick’s negligence was the sole cause of the penalty. It cites several cases which hold the issue of the tax preparer’s negligence is irrelevant in assessing the penalty and does not excuse the taxpayer from payment. See Metra Chem. Corp., 88 T.C. 654, 662 (1987); Magill v. Comm’r, 70 T.C. 465, 479 (1978), aff'd 651 F.2d 1233 (6th Cir. 1981); Pritchett v. Comm’r, 63 T.C. 149, 174 (1974). While it is true the tax preparer’s negligence may not exonerate the taxpayer from his own negligence, none of these cases hold that the taxpayer cannot recover from the tax preparer the proportionate share of a penalty resulting from the tax preparer’s negligence. In fact, the United States Supreme Court has stated that, although the taxpayer cannot avoid the penalty, he may have a cause of action against the tax preparer based on his good faith reliance on the tax preparer’s expertise. United States v. Boyle, 469 U.S. at 250. Bick’s negligence is not, as a matter of federal law, the sole cause of the negligence penalty.
Next, Peat Marwick contends the purpose of the negligence penalty is to penalize the taxpayer for his own negligence and to shift the penalty to others would undermine tax enforcement. In support of this contention, it cites prior cases prohibiting a shift of criminal penalties from one person to another. See Herrman v. Folkerts, 202 Kan. 116, 120, 446 P.2d 834 (1968) (insurance policy is void if it insures against liability for criminal actions); Koch v. Merchants Mutual Bonding Co., 211 Kan. 397, 405, 507 P.2d 189 (1973) (impermissible to charge bonding company with penalty imposed for embezzlement or conversion). These cases deal with criminal penalties and are hot applicable to the present case.
The federal courts have consistently held penalties imposed under various Internal Revenue Code sections are not criminal penalties. Rather, they are civil penalties imposed as a means of insuring that the taxes owed the government are paid and paid promptly. They are merely collection devices. United States v. Boyle, 469 U.S. at 245 (penalty imposed under § 6651[a][l] for negligent late filing intended to insure timely filing of tax returns); Swift v. Levesque, 614 F. Supp. at 177 (§ 6672 is a civil penalty, not a criminal punishment, designed to insure payment of all tax due and owing). There is no indication in the statute that § 6653(a) is any different or that the federal courts would construe it differently. Peat Marwick cites to no cases stating there are sound policy reasons against allowing a right of indemnity to someone who negligently relies on the advice of a professional in preparing tax returns. An award of damages for civil penalties imposed under § 6653(a) does not contravene public policy.
Finally, Peat Marwick contends its negligent act was not the proximate cause of Bick’s injury. The proximate cause of an injury is that cause which in a continuous, natural sequence, unbroken by an efficient intervening cause, produces the injury as a natural and probable consequence of the wrongful act. Hammig v. Ford, 246 Kan. at 73. Whether an intervening act of negligence is sufficient to insulate the original tortfeasor from liability depends on the foreseeability of the intervening act. If the intervening act is reasonably foreseeable, the original tortfeasor is not absolved and his negligent act is a proximate cause of the injury. Schmeck v. City of Shawnee, 232 Kan. 11, 28, 651 P.2d 585 (1982). Whether the negligent act is the proximate cause of the injury is normally a question of fact for the jury. Hammig v. Ford, 246 Kan. at 74.
At trial, two certified public accountants testified that an accountant cannot depend upon a taxpayer to review the tax returns. Both testified the majority of taxpayers merely look at the bottom line showing the amount due or owing and sign the returns. This evidence supports the legal conclusion that Bick’s act of negli gence was reasonably foreseeable and does not act to insulate Peat Marwick from its proportionate responsibility for the loss.
3. Evidence of Prior Conviction
Defendant contends the trial court committed reversible error in prohibiting evidence of Bick’s prior conviction of aiding and abetting the violation of 18 U.S.C. § 1860 (1984) for impeachment purposes. K.S.A. 60-421 provides that evidence of prior convictions used for impeachment purposes is inadmissible unless the prior crime involves dishonesty or false statement. The crime involved here is a violation of 18 U.S.C. § 1860, which states:
“Whoever bargains, contracts, or agrees, or attempts to bargain, contract, or agree with another that such other shall not bid upon or purchase any parcel of lands of the United States offered at public sale; or
“Whoever, by intimidation, combination, or unfair management, hinders, prevents, or attempts to hinder or prevent, any person from bidding upon or purchasing any tract of land so offered for sale —•
“Shall be fined not more than $1,000 or imprisoned not more than one year, or both.”
Bick pleaded guilty to the following information:
“In April, 1979, in the State and District of Colorado, Koch Industries, by combination with others, did prevent and attempt to hinder and prevent other persons from purchasing a parcel of land of the United States offered at public sale, to wit: Wyoming Parcel No. W-68066, RICHARD BICK, ROBERT WALTON and JIM WHISNAND did aid and abet Koch Industries in preventing other persons from purchasing parcel No. W-68066; all in violation of Title 18, United States Code, Sections 1860 and 2.”
In ruling on the admissibility of the conviction, the trial court stated the statute was designed to “prevent fraud upon the United States, in that it prevents persons from combining to evade a fair auction by the United States of parcels for oil and gas exploration.” The trial court went on to say that type of activity is not always fraud, but may be an antitrust violation not amounting to fraud. In ruling the evidence was inadmissible, the trial court noted the word “fraud” was not used in the information or the judgment.
The phrase “dishonesty or false statement” means crimes such as perjury, criminal fraud, embezzlement, forgery, or any other offense involving some element of deceit, untruthfulness, or lack of integrity in principle. The issue in determining the admissibility of prior convictions is whether dishonesty is an inherent element of the offense. For example, larceny is considered a crime involving dishonesty because, the crime itself shows a lack of integrity. Tucker v. Lower, 200 Kan. 1, 5, 434 P.2d 320 (1967). Crimes of physical violence, drunkenness, reckless driving, vehicular homicide, and narcotic offenses are generally excluded as these crimes normally are not associated with dishonesty or false pretenses. See Fudge v. City of Kansas City, 239 Kan. 369, 375-76, 720 P.2d 1093 (1986); Tucker, 200 Kan. at 5. Conspiring and aiding and abetting such a conspiracy to prevent others from participating in a public auction of parcels of land is dishonest and inherently includes an element of fraud. It is irrelevant that the statute defining the crime does not employ the term “fraud.” It is also irrelevant that the statute is designed to prevent fraud upon the government rather than upon an individual. Convictions of violation of 18 U.S.C. § 1860 are admissible to impeach the credibility of a witness.
The next issue is whether the error affirmatively appears to have prejudicially affected Peat Marwick’s substantial rights (K.S.A. 60-2105). Harmless errors, not prejudicing the substantial rights of the complaining party, must be disregarded on appeal. Hagedorn v. Stormont-Vail Regional Med. Center, 238 Kan. 691, 701, 715 P.2d 2 (1986). Further, Peat Marwick has the burden of proving the trial court’s erroneous exclusion of Bick’s prior conviction resulted in prejudice to its substantial rights. See Walters v. Hitchcock, 237 Kan. 31, 35, 697 P.2d 847 (1985). On appeal, Peat Marwick merely contends the exclusion was incorrect as a matter of law and requires reversal per se. We disagree. Kansas case law is replete with decisions placing the burden of proof on the complaining party. Peat Marwick does not indicate what possible effect the admission of the prior conviction would have had on the outcome of the trial.
The record itself does not show Peat Marwick was prejudiced. This is a civil action for damages for professional negligence. Peat Marwick’s basic defense was it relied on Bick to review the tax returns. Bick, on the other hand, testified he relied on Peat Marwick’s professional expertise. The central issue, therefore, was whether either party could reasonably rely on the other and what proportionate share of the responsibility each party bore for the loss. The sole purpose of introducing evidence of Bick’s prior conviction was to impeach his credibility as a witness. Bick’s credibility is irrelevant to the issue of Peat Marwick’s expectations of reliance on him and the reasonableness of that reliance. The trial court did not restrict cross-examination of Bick regarding his knowledge of the tax code or his failure to review the tax returns. He admitted he did his own tax returns prior to 1981, understood the term “capital gains,” knew a stock sale was a capital gain which must be reported, and did not even make a cursory review of the tax returns. Exclusion of evidence of Bick’s prior conviction did not affect the fairness of the trial and did not prejudice Peat Marwick’s substantial rights to a fair trial. The error was therefore harmless.
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Noone, J.;
Allen Realty, Inc., appeals from an order by the district court granting summary judgment to the City of Lawrence and dismissing plaintiffs appeal from a determination by Ramon Powers, the State Historic Preservation Officer for the State of Kansas (SHPO), recommending denial of a demolition permit.
Plaintiff has owned a lot at 1040 New Hampshire Street in Lawrence since 1976; Situated on the lot is an old building known as the English Lutheran Church (the Building). New Hampshire Street runs north/south and dead-ends into Eleventh Street, which runs east/west. Massachusetts Street runs north/south parallel to and one block west of New Hampshire Street. The Douglas County Courthouse (Courthouse), which is listed on the National Register of Historic Places, is situated south of Eleventh Street and. fronts on the 1100 block of Massachusetts Street,
For about eight years prior to March 1988, the Building had been leased to the Lawrence Baptist Temple but was vacated during March 1988 because of its deteriorated and unsafe condition. An inspection of the Building by the Lawrence Fire Department, also during March 1988, found numerous violations of the Lawrence fire code and instructed plaintiff to correct such violations. Plaintiff employed an architect and obtained estimates of the cost of necessary repairs and/or renovation of the Building. Subsequently, plaintiff applied to the City for a permit to demolish the Building.
Because of the Building’s proximity to the Courthouse, a registered historic site, the SHPO was notified of plaintiffs application for a demolition permit.
Initially, the SHPO determined that the proposed demolition would not affect any registered historic property. The SHPO withdrew that determination by letter of June 1, 1988. On June 29, 1988, the SHPO recommended by letter that the City deny the demolition permit because it “will encroach upon, damage or destroy a historic building in the environs of the Douglas County Courthouse, a property listed on the National Register of Historic Places.” (Emphasis added.)
Plaintiff, by letter of July 6, 1988, requested the City to issue the demolition permit, alleging in effect that the SHPO’s determination of June 29, 1988, referred to the Building, which was not a registered historic building. Thereafter on July 13, 1988, the SHPO wrote the City a third letter, stating that the demolition “would encroach upon, damage or destroy the environs of the Douglas County Courthouse” (emphasis added), and again recommended that the demolition permit be denied.
Once that determination was made by the SHPO, the City could not issue a demolition permit until the governing body of the City determined, after considering all relevant factors, “that there is no feasible and prudent alternative to the proposal and that the program includes all possible planning to minimize harm to such historic property resulting from such use.” K.S.A. 75-2724(a).
The City put the matter on its commission agenda for July 19, 1988, and invited plaintiff to appear and show cause why the demolition permit should not be denied. Following such hearing, the permit was denied. Plaintiff appealed the SHPO’s determination pursuant to K.S.A. 77-601 et seq. and the City’s denial of the demolition permit pursuant to K.S.A. 75-2724(b) and K.S.A. 1989 Supp. 60-2101(d) to the district court. The district court dismissed plaintiff’s appeal from the SHPO’s determination and granted summary judgment to the City on plaintiff s appeal from the City’s denial of the permit.
Plaintiffs instant appeal emanates from the implementation of the provisions of the Kansas Historic Preservation Act. K.S.A. 75-2715 et seq. K.S.A. 75-2715 reads:
“The legislature hereby finds that the historical, architectural, archeological and cultural heritage of Kansas is an important asset of the state and that its preservation and maintenance should be among the highest priorities of government. It is therefore declared to be the public policy and in the public interest of the state to engage in a comprehensive program of historic preservation and to foster and promote the conservation and use of historic property for the education, inspiration, pleasure and enrichment of the citizens of Kansas.”
Since 1977, Kansas law has placed the burden on the state and its political subdivisions to provide notice of projects which might have an adverse impact upon historic properties. K.S.A. 75-2724 provides the procedure for determining whether a proposed project threatens a historic property. In pertinent part, K.S.A. 75-2724(a) provides:
“The state or any political subdivision of the state, or any instrumentality thereof, shall not undertake any project which will encroach upon, damage or destroy any historic property included in the national register of historic places or the state register of historic places or the environs of such property until the state historic preservation officer has been given notice, as provided herein, and an opportunity to investigate and comment upon the proposed project. Notice to the state historic preservation officer shall be given by the state or any political subdivision of the state when the proposed project, or any portion thereof, is located within 500 feet of the boundaries of a historic property located within the corporate limits of a city, or within 1,000 feet of the boundaries of a historic property located in the unincorporated portion of a county.”
The proposed demolition of the Building clearly qualifies as a “project” as that term is defined in K.S.A. 75-2716(c): “ ‘Project’ includes: ... (3) activities involving the issuance of a lease, permit, license, certificate or other entitlement for use, to any person by the state or any political subdivision of the state, or any instrumentality thereof.”
If the SHPO determines that a project would encroach upon, damage, or destroy a historic property or its environs, the project is halted and can only proceed if the governing body makes certain determinations. K.S.A. 75-2724(a) continues in part:
“If the state historic preservation officer determines, with or without having been given notice of the proposed project, that such proposed project will encroach upon, damage or destroy any historic property included in the national register of historic places or the state register of historic places or the environs of such property, such project shall not proceed until: (a) The governor, in the case of a project of the state or an instrumentality thereof, or the governing body of the political subdivision, in the case of a project of a political subdivision or an instrumentality thereof, has made a determination, based on a consideration of all relevant factors, that, there is no feasible and prudent alternative to the proposal and that the program includes all possible planning to minimize harm to such historic property resulting from such use and (b) five days’ notice of such determination has been given, by certified mail, to the state historic preservation officer.”
In this case, the SHPO made a determination that the project (demolition of the Building) would encroach upon, damage, or destroy the environs of the Douglas County Courthouse (historic place). The governing body of the City failed to find that there was no feasible and prudent alternative to demolition and denied plaintiff’s application for a permit.
Plaintiff raises several issues on appeal. Among such issues are a claim that plaintiff was denied due process and that K.S.A. 75-2724 is unconstitutional. We shall consider these together.
In support of such claim, plaintiff points out that K.S.A. 75-2724(a) authorizes the SHPO to investigate and make a determination, in whatever manner he/she might see fit, that a project would damage a historic property. No input is required from any specific party, including the landowner. No hearing of any type is required, and there is no time limit by which the SHPO must conclude an investigation and make a determination. Plaintiff contends that this determination affects a landowner’s property rights because, if the SHPO determines that a project will damage a historic property, the project must come to a halt pending a further determination by the governing body. In the case at bar, plaintiff alleges that he sought, but was denied, a predetermination hearing by the SHPO.
In addition, plaintiff argues that K.S.A. 75-2724 contains no provision for notice to a landowner proponent of a project of any scheduled or proposed hearing by the governing body to determine whether there are feasible and prudent alternatives to the project when the SHPO has determined that such project will damage a historic property. Plaintiff also asserts that K.S.A. 75-2724 provides no procedure that the governing body must follow other than a consideration “of all relevant factors.” In the instant case, plaintiff acknowledges that he did receive a five-day notice inviting him to appear and “show cause” why the City should determine that there was no feasible and prudent alternative to demolition and that all possible planning had been done to minimize harm to the Courthouse.
Considering these arguments in reverse order, we conclude that there is no merit to plaintiffs argument that the lack of a notice provision to a private landowner in K.S.A. 75-2724 regarding a hearing by the governing body to consider the existence of feasible and prudent alternatives to a project offends due process. It is plaintiffs own argument that such a notice provision was not necessary when this statute was originally drafted because initially it applied only to government projects and the proponent would ultimately make the determination. It is also true that a private landowner, who has applied for a demolition permit from a governing body, has the right to the notices and hearings provided for by the appropriate laws governing such process. The determination by the SHPO restricted the authority of the City to issue a demolition permit but did not in any way affect the notice provision of the City’s ordinance regarding applications for demolition permits. The same may be said regarding plaintiffs further argument that K.S.A. 75-2724 provides no procedure for a governing body to follow at a hearing to determine whether feasible and prudent alternatives exist. It simply mandates what the governing body must consider before taking action (in this case on an application for a demolition permit) when the SHPO has determined that the project will adversely affect a historic property. K.S.A. 75-2724 does not purport to amend or replace the notice and hearing provision of the City’s municipal code.
A different question is posed by plaintiffs argument concerning the provision of K.S.A. 75-2724(a) regarding the authority of the SHPO. There is little question but that the language of the statute in that respect is quite sweeping:
“Notwithstanding the notice herein required, nothing in this section shall be interpreted as limiting the authority of the state historic preservation officer to investigate, comment and make the determinations otherwise per mitted by this section regardless of the proximity of any proposed project to the boundaries of a historic property. The state historic preservation officer may solicit the advice and recommendations of the historic sites board of review with respect to such project and may direct that a public hearing or hearings be held thereon.”
As plaintiff has pointed out, the SHPO is permitted to make a determination publicly or privately at the SHPO’s discretion and is not required to seek input from any interested party or entity. In view of the fact that an adverse determination has the effect of stopping a project until the governing body finds that no feasible and prudent alternative exists, plaintiff asserts that bestowing such unfettered authority on the SHPO denies due process to a landowner.
It is well established that the constitutionality of a statute is presumed and “ ‘that all doubts must be resolved in favor of its validity . . . and if there is any reasonable way to construe the statute as constitutionally valid, that should be done.’ ” Rogers v. Shanahan, 221 Kan. 221, 223, 565 P.2d 1384 (1976). In summarizing guidelines involved in determining the constitutionality of statutes in City of Baxter Springs v. Bryant, 226 Kan. 383, 386, 598 P.2d 1051 (1979), the court held: “ ‘Statutes are not stricken down unless the infringement of the superior law is clear beyond substantial doubt.’ ”
The requirements of due process do not apply unless plaintiff first establishes that a constitutionally protected interest (in this case a property interest) is at stake. Board of Regents v. Roth, 408 U.S. 564, 569, 33 L. Ed. 2d 548, 92 S. Ct. 2701 (1972); Gunkel v. City of Emporia, 835 F.2d 1302, 1305 (10th Cir. 1987).
Property interests are not inherent and are not created by the Constitution. In Gunkel, the Tenth Circuit Court of Appeals stated:
“As the Supreme Court has noted, property interests are not created by the Constitution. ‘Rather, they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law.’ Bd. of Regents v. Roth, 408 U.S. 564, 577, 92 S. Ct. 2701, 2709, 33 L. Ed. 2d 548 (1972). And, although ‘mutually explicit understandings’ can be sufficient to create such property rights, Perry v. Sindermann, 408 U.S. 593, 601, 92 S. Ct. 2694, 2699-700, 33 L. Ed. 2d 570 (1972), ‘the sufficiency of the claim of entitlement must be decided by reference to state law.’ Bishop v. Wood, 426 U.S. 341, 344, 96 S. Ct. 2074, 2077, 48 L. Ed. 2d 684 (1976); see also Logan v. Zimmerman Brush Co., 455 U.S. 422, 430, 102 S. Ct. 1148, 1155, 71 L. Ed. 2d 265 (1982) (‘The hallmark of property ... is an individual entitlement grounded in state law.’).” 835 F.2d at 1304.
Kansas law does not grant property owners a constitutionally protected property interest in permits. Restaurants of Wichita, Inc. v. City of Wichita, 215 Kan. 636, Syl. ¶ 4, 527 P.2d 969 (1974). In this case and in Gunkel, the courts found no vested property rights in permits that had been issued to property owners as against the power of the state or municipality to revoke such permits for cause. Here, plaintiff claims a protected property right in a demolition permit that has never been issued but for which plaintiff has made application. We find no basis in state law or other source for such a claim. Since plaintiff had no protected property interest in a demolition permit, he has no claim to procedural safeguards.
Plaintiff also seeks the invalidation of K.S.A. 75-2724 on the grounds that it provides for what amounts to an unlawful taking of his real property. Plaintiff alleges that the actions of the SHPO and the City have resulted in preventing any economically viable or prudent use of his property. This, he argues, is tantamount to a taking for public use without condemnation proceedings. Plaintiff cites Hodel v. Virginia Surface Mining & Recl. Assn., 452 U.S. 264, 296, 69 L. Ed. 2d 1, 101 S. Ct. 2352 (1981), and Lafayette Park Baptist Church v. Scott, 553 S.W. 2d 856, 862 (Mo. App. 1977).
We acknowledge that the cases cited by plaintiff essentially hold that statutory regulation or restriction to a degree that prevents a landowner from making economically viable or prudent use of property can effect a taking of the property. We do not agree that this is relevant to this case. The actions of the SHPO did not constitute a taking of any property interest of plaintiff and did not impose any permanent restriction on plaintiffs use of his property. At most, the SHPO’s recommendation had the effect of a “status quo” type order pending a hearing by the City Commission. The language of K.S.A. 75-2724 indicates that the legislature took pains to preclude a taking of property by its implementation. The restriction of the statute is by its own terms effective only until a landowner can demonstrate that there is no feasible and prudent alternative to the restrained use.
A taking cannot be established by showing that a historic preservation statute prevents a landowner from making a particular use of property that would be more beneficial or profitable than its current use. A leading case in that regard is Penn Central Transp. Co. v. New York City, 438 U.S. 104, 57 L. Ed. 2d 631, 98 S. Ct. 2646, reh. denied 439 U.S. 883 (1978), in which the owner of a landmark railroad terminal was prohibited from building an office building on top of the terminal. The Supreme Court found that “the submission that appellants may establish a ‘taking’ simply by showing that they have been denied the ability to exploit a property interest that they heretofore had believed was available for development is quite simply untenable.” 438 U.S. at 130.
We conclude that the implementation of K.S.A. 75-2724 by the defendants did not result in a taking of plaintiff s real property, and the district court did not err when it found 75-2724 to be constitutional.
Plaintiff next contends that the actions of both the SHPO and the City were unreasonable, arbitrary, and capricious and unsupported by substantial evidence. Since this issue was raised separately in the two appeals which were filed pursuant to different statutes, we shall consider them separately.
Plaintiffs appeal from the SHPO’s determination was properly perfected pursuant to K.S.A. 77-601 et seq., an act for judicial review of an agency action. The State Historical Society is designated as an agency by K.S.A. 75-2717(a). The SHPO’s determination and recommendation to the City was an agency action as defined by K.S.A. 77-602(b):
“ ‘Agency action’ means:
(1) The whole or a part of a rule and regulation or an order;
(2) the failure to issue a rule and regulation or an order; or
(3) an agency’s performance of, or failure to perform, any other duty, function or activity, discretionary or otherwise.”
The district court granted summary judgment and dismissed plaintiffs appeal from the agency action. Our standard of review is whether reasonable minds could differ as to the conclusion drawn from the evidence. Bacon v. Mercy Hosp. of Ft. Scott, 243 Kan. 303, 306, 756 P.2d 416 (1988).
Plaintiff essentially argues that the SHPO erroneously interpreted the term “environs” by considering plaintiffs Building to be part of the environs of the Courthouse, and that the SHPO further believed that the Building was protected by virtue of being a historic building itself, even though it was not registered. We find no merit in either of these arguments.
The term “environs” is not defined in the Kansas statutes. The fact that the legislature required that notice be given to the SHPO of projects within 500 or 1,000 feet of a historic structure or site but still authorized the SHPO to investigate and make a determination on projects beyond 500 or 1,000 feet would be rendered meaningless if the legislature intended to protect only property immediately adjacent to a registered property. If such was the intent of the legislature, as plaintiff appears to argue, it would have used a more restrictive term, such as “adjacent” rather than the broad term “environs.”
Plaintiff accurately points out that the SHPO considered plaintiffs property to be a historic building “in and of itself,” as stated in the letter of June 29, 1988, to the City. Plaintiff then contends that, because the SHPO thought plaintiffs Building had historic significance of its own, the SHPO made his determination and recommendation to the City in an effort to protect the Building instead of the Courthouse.
This allegation alone is not sufficient to show that the SHPO acted arbitrarily, capriciously, or unreasonably. The same letter clearly makes the required finding that the demolition of the Building would impact upon the environs of the Courthouse.
“The (Old) English Lutheran Church represents an early example of John Haskell’s work, while the nearby Douglas County Courthouse represents one of Haskell’s last efforts. In a very real sense the old church juxtaposes against the later Haskell work. Both buildings are constructed of native limestone, and both buildings clearly project separate and shared historic images of the downtown Lawrence community. Within five hundred feet of the courthouse stand other buildings slated for demolition; those other buildings lack the historical associations and architectural integrity of the English Lutheran Church.”
It is precisely because the Building has a historic value of its own that its demolition would impact negatively upon the nearby Courthouse. The SHPO’s actions were not arbitrary, capricious, or unreasonable and were supported by substantial evidence.
Plaintiff also contends that the SHPO was arbitrary and capricious because he rescinded the original finding that the permit would not damage the Courthouse and failed to conduct a public hearing. Plaintiffs position with regard to rescinding the original order is little more than another argument that the SHPO misconstrued the terms “environs,” which we have heretofore concluded lacked merit. We have heretofore also noted that K.S.A. 75-2724 provides that the SHPO “may direct that a public hearing or hearings be held” but does not require a public hearing. While it might well have been a better practice for the SHPO to have conducted a public hearing as he was authorized to do, it was clearly within his discretion to refuse to do so. We conclude that the district court did not err in dismissing plaintiffs appeal from the agency action.
Plaintiff contends that the City acted arbitrarily and capriciously in several respects, including placing the burden on plaintiff to prove that no feasible and prudent alternative to demolition existed. We find no fault with that determination. Clearly the burden of proof must rest on the plaintiff, who was the proponent of and the only party who would be served by such a finding.
Plaintiff further argues that the City acted arbitrarily and capriciously in that the commission members were confused as to their statutory duties. Plaintiff contends the City considered such irrelevant matters as other property allegedly, but not in fact, owned by plaintiff and whether plaintiff had tried to or could sell the subject property. In particular, plaintiff contends the City demanded detailed plans that did not exist regarding future use of the land after the proposed demolition.
Plaintiff asserts that he introduced facts, including the findings of an architectural firm, that proved demolition and removal of the Building from the land was the only feasible and prudent alternative. These facts included the magnitude of repairs required to make the Building safe and habitable, the amount of taxes and insurance, and the prohibitive cost of renovating or remodeling the Building from a church to possible use as an office building. Plaintiff also pointed out that zoning requirements for off-street parking could not be met on the lot with the existing structure.
No other evidence was offered, as such, but several members of the public made various suggestions or queries as to whether the Building could be sold or used as a church or a tourist information center or for housing or governmental offices. Plaintiff s attorney denied that plaintiff had received a bona fide offer to purchase the property. Plaintiff argues that commission members declared that they needed to know details, including plans and specifications, of what future use he would make of the land after demolition and offered to continue the meeting so that he could produce such information. Plaintiff claims that he had no such plans, and could not produce them, and asked for a decision on the demolition permit application. Some members of the commission commented upon and made inquiry concerning other parcels of property plaintiff owned that might be utilized in future plans of plaintiff. Plaintiff denied ownership of some parcels and argued that other properties had no relevance to the demolition of the Building. After plaintiff insisted that a decision on the permit was the only issue to be decided, the commission members voted to deny the permit.
The district court acknowledged that plaintiff had demonstrated that repair and maintenance of the existing Building would be costly and “with virtually no benefit,” and that renovation and conversion to office space would be “an especially futile option.” The court then noted that these were the only two alternatives that plaintiff addressed, that many alternatives were suggested by members of the public arid commission members, but that plaintiff dispelled none of those alternatives. The district court specifically found that plaintiff failed to show any effort to sell the property or to obtain additional renovation cost estimates from other architectural firms.
The district court concluded that plaintiff had the burden of proving no viable alternative to demolition. We agree. The district court further concluded, however, that the burden shifted to the opponent to suggest possible, reasonable alternatives, and then returned to the plaintiff to dispel them as imprudent or infeasible. We disagree.
Such a formula might well be appropriate in a structured judicial forum, where the parties are known and the issues defined beforehand, but such was not the case here. This was not an adversarial judicial proceeding with an identified opponent. It was a city commission meeting where members of the public may appear and participate. At least eight people made suggestions or queries about various alternatives. Members of the commission did also. Pursuant to the district court’s formula, the burden shifted back to plaintiff to dispel all of the suggested alternatives as imprudent or infeasible.
We hold that the language of K.S.A. 75-2724(a), directing the governing body to consider all relevant factors in its determination of whether there is a feasible and prudent alternative to a proposed project, was included to prevent a possible hardship or injustice. That provision authorizes the governing body to lift the restraint imposed by 75-2724 when appropriate. We further hold that the words “relevant factors” as used in K.S.A. 75-2724 mean something more than mere suggestions as to possible alternatives. A proposed alternative would be a relevant factor if it included sufficient factual information to support a conclusion that such alternative was feasible and prudent. A proposed alternative unsupported by such factual information could not form the premise of such a conclusion and would not be relevant. It was clearly arbitrary and unreasonable for the City to require plaintiff to dispel suggestions offered without evidence both by it and various members of the public in attendance. It was also error for the district court to grant summary judgment based in part upon a conclusion that plaintiff had failed to do so.
Equally important, the district court held that K.S.A. 75-2724 directed the City to find that, if the permit was issued, the program would be undertaken in such a manner as to limit harm to the Courthouse. We concur. However, the court also held that this required plaintiff to furnish the City with the information it requested as to future use of the land, including plans and specifications, type of use, etc. Plaintiff’s failure to do so, the district court held, left the City with no alternative but to deny the permit. We disagree.
K.S.A. 75-2724(a) directs the governing body to find that the “program includes all possible planning to minimize harm to such historic property resulting from such use.” The “program” in this instance was demolition of the existing building. The program would result in an unimproved lot. In response to questions concerning future use, plaintiff advised the City he had no present plan other than to remove an old, deteriorated, and unsafe structure that was a financial burden and liability hazard. The Building was not habitable, and plaintiff had been warned that he faced legal action because the Building was in violation of the fire code. Any future use of the remaining lot would require the appropriate permits from the City. Any future proposal would also trigger the provisions of the Historic Preservation Act, and the SHPO would again have the opportunity to determine what impact such proposal would have on the historic Courthouse. The action of the City requiring plaintiff to provide specific plans for future use of the remaining lot after demolition as a precondition for issuing the demolition permit was arbitrary, capricious, and unreasonable, and not relevant to the provisions of K.S.A. 75-2724.
Finally, we note that both the City and the district court concluded that plaintiff had an obligation to attempt to sell the property as an alternative. A genuine offer to purchase and preserve the property, particularly by a governmental entity or a historic preservation organization, could indeed be a relevant factor for consideration, depending on terms of the offer and all other circumstances. A sale for any purpose other than preservation would simply transfer the matter to a different plaintiff. We conclude that K.S.A. 75-2724(a) does not require a landowner to attempt to sell his property and dispel sale as an alternative before seeking relief from the governing body nor does it require him to make a forced sale.
Plaintiff also alleges that the district court erred when it denied a writ of mandamus directing the City building inspector to issue the demolition permit. We find no merit to this contention.
The judgment of the district court denying plaintiff relief and dismissing his appeal from the agency action is affirmed. The order of the district court entering summary judgment for the City is reversed and the case is remanded to the district court with directions to remand to the City for a new hearing on plaintiffs application for a demolition permit. ■ | [
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Miller, J.;
Defendant Gilbert Matson has appealed from his convictions on three drug-related charges.
The evidence is not disputed that Matson was employed by “Gene’s Machines,” a California car dealership. It was Matson’s job to buy used cars in Hutchinson, Kansas, send them to David White, Gene’s mechanic in Hutchinson, for repair, and then take the cars to California to be sold for profit.
The Reno County police department had information that Mat-son was bringing methamphetamine from California for use in an illicit drug operation with David White and others in Hutchinson. On May 10, 1988, based on information that Matson was arriving from California by plane, law enforcement officers met the plane in Wichita. They observed Matson place a bag in the trunk of a car driven by a friend and drive toward Hutchinson. As the car entered Reno County, it was stopped by law enforcement officers, who found in the trunk a large quantity of pure methamphetamine.
After a jury trial, Matson was convicted on three drug related charges, conspiracy to sell methamphetamine, K.S.A. 21-3302, K.S.A. 65-4127b(b), possession of methamphetamine with intent to sell, K.S.A. 65-4127b(b), and possession of methamphetamine without a tax stamp, K.S.A. 79-5201 et seq.
Because Matson was a third-time felon, the court declared him to be a habitual criminal, enhanced the sentences, and ordered them to run consecutively with a resulting controlling term of 23 to 75 years. Matson timely appeals.
Matson first contends that the charge of possession of methamphetamine with intent to sell was necessarily proved when he was convicted on the conspiracy charge and, therefore, his conviction on the possession charge must be vacated as being an included crime.
Thé jury was instructed that in order to find Matson guilty of the conspiracy charge, the State must prove the following:
“X. That the defendant agreed with others to commit or assist in the commission of the crime of sale of methamphetamine;
“2. That the defendant did so agree with the intent that the crime of sale of methamphetamine be committed;
“3. That the defendant or any party to the agreement acted in furtherance of the agreement by possessing a quantity of methamphetamine with intent to sell; and
“4. That this act occurred on or about the 10th day of May, 1988, in Reno County, Kansas.”
Matson maintains that the information as clarified by the instruction necessarily required the State to prove that he committed the requisite overt act of possessing methamphetamine with the intent to sell, and that this was the same act of possession for which he was separately charged in count II of the information. Thus, he argues, the possession charge was the “included crime” under K.S.A. 21-3107(2)(d), and his conviction thereon must be vacated.
The State argues that the instructions required only possession of methamphetamine with intent to sell by any member of the conspiracy and not necessarily the defendant, that David White, a codefendant, was also convicted of possessing the drug with intent to sell, and that the two charges are separate and distinct offenses.
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:
“(d) a crime necessarily proved if the crime charged were proved.”
Cases considering the applicability of this statute have consistently interpreted it to prohibit prosecutions for “lesser included crimes.” In State v. Fike, 243 Kan. 365, 367, 757 P.2d 724 (1988), the court, after considering the question at length, concluded that the “included crime” to which the proscription of the statute applies is a lesser crime or offense, i.e., “a crime” which carries a lesser penalty than the penalty for the crime charged.
Possession of methamphetamine with intent to sell is a class C felony. Conspiracy to sell methamphetamine is a class E felony. The possession charge is not a lesser included crime. Therefore, section 21-3107(2) does not prohibit conviction on both offenses.
Matson also contends that the convictions are unconstitutionally multiplicitous. He did not raise this issue at trial, but he correctly notes that multiplicity may be raised on appeal if necessary to serve the ends of justice or to prevent denial of fundamental rights. State v. Dubish, 234 Kan. 708, 718, 675 P.2d 877 (1984). Since defendant was sentenced to consecutive sentences, the controlling term of his sentences will be significantly reduced if any one conviction is set aside. We will, therefore, consider this issue.
Matson, in effect, argues that the possession charge merged into the “broader crime” of conspiracy, and that the possession charge must, therefore, be vacated.
With limited exceptions not applicable here, the general rule is that a conspiracy to commit a crime is an offense separate and distinct from the crime that is the object of the conspiracy. United States v. Davis, 578 F.2d 277, 280 (10th Cir. 1978). The rule is stated in 16 Am. Jur. 2d, Conspiracy § 5, p. 220, as follows:
“The general rule is that a conspiracy to commit a crime is an offense separate and distinct from the crime that is the object of the conspiracy. . . . Because the conspiracy is the crime and not its execution, it is punishable both where it fails in its object and where the intended crime is accomplished.”
The double jeopardy clause of the United States Constitution, of course, protects defendants in criminal proceedings from multiple punishments for the same offense. United States v. Dinitz, 424 U.S. 600, 606, 47 L. Ed. 2d 267, 96 S. Ct. 1075 (1976).
■ Multiplicity exists when the State attempts to use a single wrongful act as the basis for multiple charges. State v. Garnes, 229 Kan. 368, 372-73, 624 P.2d 448 (1981). In State v. Hobson, 234 Kan. 133, 137, 671 P.2d 1365 (1983), the court stated:
“In Jarrell v. State, 212 Kan. 171, 173, 510 P.2d 127 (1973), it was recognized that two or more separate convictions cannot be carved out of one criminal delinquency and where numerous charges are made, those which make up an integral part of another crime charged, in which the defendant was convicted, must be dismissed as duplicitous.”
The test as to whether the substantive offense and the conspiracy to commit it constitute the same offense or are separate and distinct offenses depends upon whether one requires proof of an essential element which the other does not. State v. Garnes, 229 Kan. at 373; State v. Hobson, 234 Kan. 133, Syl. ¶ 1; United States, v. Kelley, 545 F.2d 619, 624, cert. denied 430 U.S. 933 (1977).
The essence of a conspiracy charge is the agreement to commit the crime. Thus, to convict Matson on the conspiracy charge required proof of an agreement. No such agreement was required to convict on the possession charge. The two charges are, therefore, separate and distinct offenses, and we find no error in defendant’s conviction on both charges.
Matson, for a second ground on appeal, contends that the trial court violated his right to a speedy trial under K.S.A. 22-3402.
The record shows that Matson was originally charged with all three counts in one case. At a preliminary hearing on May 31, 1988, the conspiracy count was dismissed for lack of probable cause. Matson was arraigned on the possession charge and the tax stamp charges on June 6, 1988. The conspiracy charge was refiled and defendant was arraigned on this charge on July 5, 1988. The cases were consolidated prior to trial, and trial ultimately commenced on January 17, 1989.
K. S.A. 22-3402(2) provides:
“If any person charged with a crime and held to answer on an appearance bond shall not be brought to trial within one hundred and eighty (180) days after arraignment on the charge, such person shall be entitled to be discharged from further liability to be tried for the crime charged, unless the delay shall happen as a result of the application or fault of the defendant, or a continuance shall be ordered by the court under subsection (3).”
Under subsection (3), the court may grant one continuance of not more than 30 days if it needs to because of scheduling problems.
The record shows that on October 3, 1988, the trial court granted a continuance because of a crowded docket and in order to allow Matson to consult with his attorney and to prepare for trial. Defendant’s counsel argues that since he did not request the continuance, the time should not be charged to defendant. He concedes, however, that 30 days could be excused under the statute, which would extend the period to 210 days, but he maintains that the defendant is entitled to be discharged because he was not brought to trial until 224 days after his arraignment, which leaves 14 unexcused days.
The matter was originally set for trial on August 29, 1988. On August 5, 1988, however, Matson’s first attorney was allowed to withdraw as counsel on the grounds that there had been a breakdown of communication with his client and that no attorney fees had been paid. Matson was ordered to obtain an attorney within 10 days.
On August 26, 1988, Matson appeared before the trial court without counsel. On August 30, 1988, the court appointed an attorney to represent Matson and the case was set over to October 3, 1988, for jury trial. On October 3, 1988, Matson and his counsel appeared before the trial court. Because of numerous missed appointments by the defendant, appointed counsel had never seen defendant before that day. The court chastised the defendant for failing to keep in contact with his attorney and rescheduled the trial for January 9, 1989.
Although defendant’s counsel objected to the continuance, it is obvious that it would have been error for the court to insist upon proceeding with the trial of defendant on October 3, 1988, as scheduled, when defendant’s counsel had not yet been able to consult with his client. The trial, in addition to being continued to allow defense counsel to file motions, was clearly continued for defendant’s benefit to allow him to meet with his counsel and prepare for trial.
Here, defendant failed to appear in court on August 5, 1988, to hear his first attorney’s motion to withdraw, and failed to obtain new counsel within 10 days as ordered by the court. A new attorney was appointed for him on August 30, but defendant had not bothered to talk to him by October 3. The period of time between August 4 and October 3, a period of 59 days, is properly charged to the defendant because during this period of time the defendant hindered the progress of his own case by not participating in his defense. This leaves 166 days chargeable to the State, well within the time limitation imposed by the statute. The defendant was, therefore, tried within the time constraints established by K.S.A. 22-3402(2).
Finally, Matson claims that the tax on marijuana and controlled substances, K.S.A. 79-5201 et seq., is in reality a criminal penalty, and as such it is an unconstitutional denial of due process under the Fourteenth Amendment. The State argues that the issue was not raised at trial and, therefore, should not be considered.
As a general rule, where constitutional grounds are asserted for the first time on appeal, they are not properly before the appellate court for review. State v. Goss, 245 Kan. 189, 193, 777 P.2d 781 (1989).
“However, if a newly asserted issue involves only a legal question arising on proved or admitted facts which will be finally determinative of the case, or if consideration is necessary to serve ends of justice or to prevent a denial of fundamental rights, an appellate court may consider the issue even though not considered by the trial court.” State v. Anderson, 12 Kan. App. 2d 342, Syl. ¶ 1, 744 P.2d 143 (1987).
As noted above, the defendant was sentenced to consecutive terms; therefore, to serve the ends of justice, the constitutional issue will be considered.
Some constitutional questions about the Kansas drug tax were resolved in State v. Durrant, 244 Kan. 522, 769 P.2d 1174 (1989). The Durrant court held that the tax does not violate the Fifth Amendment privilege against self-incrimination. The basic principles for determining the constitutionality of a statute were set forth as follows:
“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. 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.” 244 Kan. 522, Syl. ¶ 1.
Justice Holmes, speaking for the court, went on to say:
“While some have questioned the propriety of a governmental entity imposing a tax upon an illegal act, the United States Supreme Court has held that a tax may be imposed on an activity that is wholly or partially unlawful under state or federal statute. [Citations omitted.] In doing so, however, the government may not violate constitutional restrictions.” 244 Kan. at 528.
The defendant argues that in enacting the statute, it was recognized by the legislature that dealers were unlikely to pay the tax, that little revenue would be raised thereby, and that the primary purpose of the tax was to further punish drug, dealers.
As noted by Justice Holmes in Durrant, the United States Supreme Court has considered in a number of different circumstances whether a tax is, in fact, a penalty. In Lipke v. Lederer, 259 U.S. 557, 66 L. Ed. 2d 1061, 42 S. Ct. 549 (1922), the court considered a federal prohibition era statute which made the manufacture and sale of liquor illegal and imposed a tax on the “ ‘illegal manufacture [and] sale’ ” of liquor. The court stated:
“The mere use of the word ‘tax’ in an act primarily designed to define and suppress crime is not enough to show that within the true intendment of the term a tax was laid. [Citation omitted.] When by its very nature the imposition is a penalty, it must be so regarded. [Citation omitted:] Evidence of crime ... is essential to assessment . . . [of the tax]. It lacks all the ordinary characteristics of a tax, whose primary function, ‘is to provide for the support of the government’ and clearly involves the idea of punishment for infraction of the law — the definite function of a penalty.” Lipke, 259 U.S. at 561-62.
In more recent decisions, however, the Court has backed away from this strong position against such taxes. In United States v. Sanchez, 340 U.S. 42, 95 L. Ed. 47, 71 S. Ct. 108 (1950), the Court upheld a federal tax on marijuana. The statute levied a tax on “every person who imports, manufactures, produces, compounds, sells, deals in, dispenses, prescribes, administers, or gives away marijuana.” 340 U.S. at 43. Additional penalties were provided for failure to pay the tax.
The Court held that in enacting the statute, Congress had two objectives, namely, to raise revenue and at the same time to make it extremely difficult for persons to obtain the drug for illegal purposes. It said:.
“It is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely deters the activities taxed. [Citation omitted.] The principle applies even though the revenue obtained is obviously negligible [citation omitted].
“The tax levied ... is not conditioned upon the commission of a crime. The tax is on the transfer of marijuana to a person who has not paid the special tax and registered. Such a transfer is not made an unlawful act under the statute.” Sanchez, 340 U.S. at 44-45.
The Supreme Court has essentially followed the same reasoning in subsequent cases in which the question has been considered. In two separate cases, it upheld the constitutionality of a federal statute, 26 U.S.C. § 3285 (1952) (now 26 U.S.C. § 4401 [1988]), which taxed gambling earnings. In both cases, it was argued that, because gambling was illegal, the tax was merely a penalty. The Court stated:
“It is conceded that a federal excise tax does not cease to be valid merely because it discourages or deters the activities taxed. Nor is the tax invalid because the revenue obtained is negligible. Appellee, however, argues that the sole purpose of the statute is to penalize only illegal gambling in the states through the guise of a tax measure. As with the above excise taxes which we have held to be valid, the instant tax has a regulatory effect. But regardless of its regulatory effect, the wagering tax produces revenue. As such it surpasses both the narcotics and firearms taxes which we have found valid.” United States v. Kahriger, 345 U.S. 22, 28, 97 L. Ed. 754, 73 S. Ct. 510, reh. denied 345 U.S. 931 (1953).
See Lewis v. United States, 348 U.S. 419, 99 L. Ed. 475, 75 S. Ct. 415, reh. denied 349 U.S. 917 (1955).
Again, in Pittsburgh v. Alco Parking Corp., 417 U.S. 369, 41 L. Ed. 2d 132, 94 S. Ct. 2291 (1974), the court held that a 20 percent tax on privately operated parking lots is not a penalty even though it was designed to discourage operation of such lots.
Although the tax on marijuana considered by the Court in Sanchez was later repealed after it was found to be violative of the prohibition on self-incrimination (Leary v. United States, 395 U.S. 6, 23 L. Ed. 2d 57, 89 S. Ct. 1532 [1969]), the reasoning of the Court in Sanchez is persuasive here.
Although the minutes of the Kansas House and Senate Committees show that the primary purpose of the act was to combat drug usage, raising revenue was a motive that was definitely considered. The committee minutes reflect the following statement by Rep. Robert Miller: “The taxes would provide a way to tax part of the flourishing underground economy that is normally operating on a tax-free basis.” Hearings on HB-2140 before the House Taxation Committee, 1987 Session. Other testimony before the committee reflects similar goals, including suggestions that the revenue collected be used not only to combat illegal drug usage but also for a program for the prevention, education, and rehabilitation of those adversely affected by the drug trade.
Because revenue collection is one of the objectives of the statute and because imposition of the tax does not expressly depend on the illegal nature of the sale or possession of marijuana, we hold that the statute is constitutionally valid under the United States Constitution.
Defendant also argues that the drug tax violates Article 11, § 5 of the Kansas Constitution, which provides: “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.” However, Article 11, § 5 applies only to property taxes and not to excise taxes or licenses. Farmers Union C.C.E. v. Director of Revenue, 163 Kan. 266, 268, 181 P.2d 541 (1947). The drug tax does not violate this section of the Kansas Constitution.
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Brazil, J.:
Mobil Oil Corporation (Mobil) appeals a district court decision granting Sfeld Engineering, Inc., (Sfeld) summary judgment and finding that Sfeld had valid liens on three oil and gas leases and could foreclose the liens against Mobil. We affirm.
The parties stipulated to the facts of the case. Mobil placed an order with Franklin Supply Company (Franklin) to purchase three water tanks to be delivered and set up at three of Mobil’s lease locations. Franklin requested Sfeld to supply and deliver the tanks to Mobil. Each of the tanks was shipped to a leasehold site in two parts. There, Sfeld bolted the halves together, lined the insides with fiberglass, and placed the fittings as directed by the Mobil representative. The tanks were further installed and put into operation by F & O Roustabouts, an independent contractor retained by Mobil. Mobil paid Franklin, but Franklin refused to pay Sfeld. Sfeld filed a statement of lien claim covering the delivered equipment within six months of the delivery dates. Sfeld filed an action to foreclose on the three liens and a motion for summary judgment. The trial court granted summary judgment to Sfeld and determined that Sfeld possessed three valid liens covering Mobil’s oil and gas leases, which Sfeld was entitled to foreclose.
The facts in this case are undisputed. Summary judgment is appropriate where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. When reviewing a grant of summary judgment, this court must read the record in the light most favorable to the party who defended against the motion. Danes v. St. David’s Episcopal Church, 242 Kan. 822, 830, 752 P.2d 653 (1988). This case involves a determination of the legal relationship between the parties and is subject to unlimited review. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
Liens on oil and gas leases are created and governed by the provisions of K.S.A. 55-207 to 55-210 inclusive. “Oil and gas lien laws confer special privileges, are to be strictly construed against one claiming the privilege, and their scope is not to be extended beyond that clearly granted by the legislature.” Interlake, Inc. v. Kansas Power & Light, 231 Kan. 251, 253, 644 P.2d 385 (1982). Sfeld must establish that it is statutorily authorized to assert a lien. K.S.A. 55-207 provides in relevant part:
“Any person, corporation, or copartnership who shall under contract, express or implied, with the owner of any leasehold for oil and gas purposes, ... or with the trustee or agent of such owner, who shall perform labor or furnish material . . . used in . . . completing, operating or repairing of any oil or gas well or who shall furnish any oil-well supplies or perform any labor in constructing or putting together any of the machinery used, in . . . operating, completing or repairing of any gas well, shall have a lien upon the whole of such leasehold . . . .”
K.S.A. 55-208 provides:
“Any person, copartnership or corporation who shall furnish such machinery or supplies to a subcontractor under a contractor, or any person who shall perform such labor under a subcontract with a contractor, or who as an artisan or day laborer in the employ of such contractor, and who shall perform any such labor, may obtain a lien upon said leasehold for oil and gas purposes or any gas pipe line or any oil pipe line from the same tank and in the same manner and to the same extent as the original contractor for the amount due him or her for such labor, as provided in K.S.A. 55-207.”
The Interlake court, in discussing the categories afforded protection by K.S.A. 55-208, said:
“K.S.A. 55-208 expressly affords protection to: (1) a legal entity furnishing machinery or supplies to a subcontractor under a contractor; (2) a person performing labor under a subcontract with the contractor; and (3) an artisan or day laborer employed by a contractor. Protection was judicially extended to a fourth category in [Mountain Iron & Supply Co. v. Branum, 200 Kan. 38, 434 P.2d 1015 (1967)]. That fourth category is suppliers of material to a contractor. It would, after all, be wholly illogical if protection were afforded to a materialman supplying a subcontractor but not to a materialman supplying a contractor. Mountain Iron represents basically a judicial correction of a statutory omission rather than an extension of the scope of the statute.” Interlake, Inc. v. Kansas Power & Light, 231 Kan. at 254.
In Interlake, KP&L was expanding a natural gas pipeline in southwest Kansas. KP&L issued a purchase order for pipe to Continental Pipe & Tube Corporation and contracted with a separate construction company to construct the pipeline. Continental contracted with Interlake to furnish the pipe; Interlake shipped the pipe to Plexco, another KP&L contractor, to coat the pipe. Continental failed to fully pay Interlake, so Interlake filed an oil and gas mechanic’s lien against KP&L. 231 Kan. at 252. The trial court held and this court affirmed that Interlake had a valid lien under K.S.A. 55-208. 231 Kan. at 254. The Supreme Court re versed and concluded that Continental must be considered to be a materialman, that Interlake served as a supplier to a materialman, and that a supplier to a materialman is afforded no protection under the oil and gas lien statutes. 231 Kan. at 256-57. In reversing, the court relied on the following discussion of the various classes of potential lien claimants found in 53 Am. Jur. 2d, Mechanics’ Liens §§ 71, 72, 73:
“ ‘§ 71. Materialmen.
“ ‘The right to assert a mechanic’s lien is now generally extended to materialmen or those persons who supply materials for the structure and have no other connection with the work. But materialmen, to be entitled to a lien, must be specifically referred to within the statute, for it cannot be extended to that class by construction. Thus, materialmen are not generally within the term “contractor” or “subcontractor.”
“ ‘§ 72. Contractors or subcontractors distinguished.
“ ‘In some jurisdictions there is no distinct class of “materialmen.” The statutes confer the right to a lien on persons furnishing materials but designate them as contractors or subcontractors, depending on whether such persons furnish materials to the owner of a structure or to the contractor constructing it. Generally, however, a distinction is made, at least for some purposes, between contractors or subcontractors on the one hand and materialmen on the other, based upon the nature of the person’s contract obligation, and materialmen are not generally within the term “contractor” or “subcontractor. ”
“ ‘Where a distinction is made between a subcontractor and a material-man, a person, to become a subcontractor rather than a materialman must generally do something more than merely furnish materials. It has been declared that he must actually construct with such materials some part of the structure which the contractor has agreed to erect, although this construction, at least in some jurisdictions, need not be at the jobsite. Thus, the rule is laid down that the essential feature which constitutes one a subcontractor rather than a materialman is that in the course of performance of the prime contract he constructs a definite, substantial part of the work of improvement in accord with the plans and specifications of such contract, not that he enters upon the jobsite and does the construction there.
“ ‘Accordingly, it is held that one who merely furnishes materials to the owner or a contractor is a materialman, and not a contractor or subcontractor, within the meaning of the mechanic s lien laws ....
Ԥ 73. Suppliers of a materialman or subcontractor.
“ ‘Persons supplying material to a materialman or a subcontractor must come clearly within the terms of the statute, or they can claim no lien. They are so far removed from the owner that the privilege of a lien is not often extended to them, and the plainest expressions of law must be used to entitle them to this remedy. Thus, where a construction company, engaged in building a church, placed an order for certain materials required in the construction of the church, understanding that such-material would be obtained from a certain manufacturer, the manufacturer of the materials was held to have no right to a lien against the church in which the materials were incorporated. Materialmen in the second degree may, however, be provided for by a statute which expresses-with sufficient clearness an intent to this effect. Under some statutes it is stated that a supplier of a materialman is not entitled to a lien but that a supplier of a contractor is.’ pp. 582-86. (Emphasis supplied.)” 231 Kan. at 255-56.
This court must determine the legal status of Franklin and Sfeld. If Franklin is a contractor and Sfeld is a subcontractor, Sfeld’s lien is valid. If Franklin is a materialman and Sfeld is a supplier to a materialman, Sfeld is provided no protection under the oil and gas lien statutes.
Franklin’s agreement with Mobil provides that the tanks were to be delivered to Mobil’s locations and set up. Sfeld performed the agreement for Franklin by delivering three tanks to the specified locations. At each location, Sfeld bolted the halves of the tanks together, lined the insides with fiberglass, and placed the fittings as directed by Mobil’s representative. The tanks were difficult to transport because of their size and the possibility of damaging the fiberglass liner, so they were assembled at each location. Prior to placement of the fittings, Sfeld’s activity was not sufficient to distinguish the case from Interlake. Also, storing each tank at a location on each leasehold under the direction of Mobil would not differ from delivering pipe to a specific location in the Interlake case.
The distinction from Interlake arises with the requirement by Mobil that Sfeld place the fittings on each tank under the direction of Mobil. After the tanks were assembled, they were installed and placed into operation by F & O Roustabouts by placing each tank partially below ground in a hole dug for the tank and by connecting a water line from the well to the tank. To accomplish this installation, it was the responsibility of Sfeld, under the direction of Mobil, to place the fittings on each tank at a point that would connect with the water line from each well. The placement of the fittings was done by Sfeld, not F & O Roustabouts, making each tank uniquely suited for each well.
In performing this service, Sfeld did something more than merely furnish materials; it actually constructed with such materials (the tanks) some part of the structure that the contractor (Franklin) had agreed to erect at each well location. Interlake, 231 Kan. at 256. In this case, Franklin was a contractor, not a materialman, and Sfeld was a subcontractor, not a supplier to a materialman. Accordingly, Sfeld has a valid lien under K.S.A. 55-208.
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Davis, J.:
The defendant, Farmland Mutual Insurance Company, issued a policy insuring plaintiff, Penalosa Cooperative Exchange, against employee dishonesty. Plaintiff filed two claims based upon employee embezzlement for two policy periods. Defendant paid the first claim but denied the second on the grounds that the embezzlement resulted from a series of similar or related acts which, under the policy, constituted a single occurrence. The trial court, on stipulated facts, granted summary judgment to plaintiff for its second claim of $100,000. The defendant appeals. We affirm.
Wayne Winter was employed by plaintiff as its general manager from June 1, 1979, until January 7, 1986. During that time, he embezzled at least $740,000. Of that sum, $228,900 was embezzled on 14 different occasions between July 19, 1984, and May 31, 1985, and $511,100 was embezzled on 12 different occasions between June 7, 1985, and December 17, 1985. On each occasion, Winter committed the embezzlement by transferring plaintiffs funds by wire or by check to a commodities broker for speculation in the commodities market.
Farmland originally issued its policy to plaintiff from June 1, 1984, through June 1, 1985. The policy was renewed from June I, 1985, through June 1, 1986. The limit of liability for loss caused by employee dishonesty was $100,000.
Plaintiff filed two claims with Farmland for $100,000 each. Farmland paid $100,000 under the policy in effect from June 1, 1984, to June 1, 1985, but denied the second claim. Farmland argues that the unambiguous terms of its policy allow plaintiff to recover only once for a single occurrence.
Because the facts were submitted by stipulation, and because the construction of a written instrument is a question of law, our standard of review is de novo. Lightner v. Centennial Life Ins. Co., 242 Kan. 29, Syl. ¶ 1, 744 P.2d 840 (1987); American States Ins. Co. v. Hartford Accident & Indemnity Co., 218 Kan. 563, Syl. ¶ 4, 545 P.2d 399 (1976).
The question for resolution requires that we interpret the policy of insurance issued by Farmland. Before dealing with the applicable policy provisions, it will be helpful to set forth the rules to be applied in our interpretation of Farmland’s policy.
(1) Insurance is a matter of contract. The parties to a contract of insurance may choose whatever terms they wish, and courts will enforce the policy as written so long as the terms do not conflict with pertinent statutes or with public policy. Western Casualty & Surety Co. v. Trinity Universal Ins. Co., 13 Kan. App. 2d 133, Syl. ¶ 1, 764 P.2d 1256 (1988), aff'd 245 Kan. 44, 775 P.2d 176 (1989).
(2) If a dispute arises as to the meaning of the terms chosen by the parties, courts will attempt to determine what the parties intended. To determine this intent, courts will consider the policy as a whole and will examine the language used by the parties, taking into account the situation of the parties, the nature of the subject matter, and the purpose to be accomplished. American Media Inc. v. Home Indemnity Co., 232 Kan. 737, Syl. ¶ 1, 658 P.2d 1015 (1983); Mah v. United States Fire Ins. Co., 218 Kan. 583, Syl. ¶ 1, 545 P.2d 366 (1976).
(3) If there is no uncertainty about the meaning of the policy, it will be enforced as written. American Media, 232 Kan. 737, Syl. ¶ 5; Nash v. Adkins, 11 Kan. App. 2d 326, 328-29, 720 P.2d 1129 (1986).
(4) If there is uncertainty about the meaning of the policy, courts determine the meaning by applying rules of construction. These rules do not apply unless the court first determines that the policy is ambiguous. A policy is not ambiguous unless, viewing it as a whole, there is genuine uncertainty as to which one of two or more possible meanings is the proper meaning. Patrons Mut. Ins. Ass’n v. Harmon, 240 Kan. 707, 713, 732 P.2d 741 (1987). Ambiguity may not be created by viewing the policy in fragmentary segments. Farm Bureau Mut. Ins. Co. v. Horinek, 233 Kan. 175, 180, 660 P.2d 1374 (1983); Nash v. Adkins, 11 Kan. App. 2d at 329. And the rules of construction do not “ ‘authorize a perversion of the language, or the exercise of inventive powers for the purpose of creating an ambiguity where none exists.’ ” Topeka Tent & Awning Co. v. Glen Falls Ins. Co., 13 Kan. App. 2d 553, 556, 774 P.2d 984 (1989) (quoting Central Security Mutual Ins. Co. v. DePinto, 235 Kan. 331, 333, 681 P.2d 15 [1984]).
Where genuine ambiguity exists, courts will apply one of the two following rules:
(1) The first is the doctrine of “reasonable expectations”. This doctrine comes in many forms. See Jerry, Understanding Insurance Law § 25D (1987). The version recognized in Kansas is relatively narrow. Recognizing that insurance contracts are typically adhesion contracts in which the terms are drafted by the insurer and not negotiated between the parties, courts have required insurers to state their intended meaning clearly and distinctly. If the meaning is not stated clearly, and a reasonable person in the insured’s position would have understood the words of the policy to mean something other than what the insurer intended, that understanding will control. Gowing v. Great Plains Mutual Ins. Co., 207 Kan. 78, 80-82, 483 P.2d 1072 (1971); see also American Media, 232 Kan. 737, Syl. ¶ 6; Fowler v. United Equitable Ins. Co., 200 Kan. 632, 633-34, 438 P.2d 46 (1968).
(2) The second is the rule of liberal construction. If the intent of the parties cannot be determined from the contract, courts will construe the policy in the way most favorable to the insured. Lightner, 242 Kan. at 36; American Media, 232 Kan. 737, Syl. ¶ 4. This rule is simply a rule of construction to aid the court in determining the intent of the parties, and its basis is that the drafter of a contract must suffer the consequences if he does not make the terms clear. Lightner, 242 Kan. at 36.
The applicable provisions of the policy are:
“II. CRIME INSURANCE
“A. PROPERTY COVERED
We cover money, securities, personal property and stock owned by you while within your place of business.
“C. CONDITIONS
“1. Employee Dishonesty
“The following conditions apply to this peril:
“b. Dishonest or fraudulent acts or a series of similar or related acts of any employee acting alone or in collusion with others during the policy period shall be deemed to be one occurrence for applying the limit of liability.
“c. Loss is covered only if discovered not later than one year from the end of the policy period, and then this insurance shall apply only to loss sustained during the policy period.
“d. If more than one insured is covered under this policy, our liability shall not exceed the amount for which we would be liable if there was only one insured.
“e. Regardless of the number of years this policy shall continue in force, the limit of liability shown in the declarations shall not be cumulative from year to year.
“3. Employee Dishonesty; Destruction and Disappearance; Burglary, Robbery or Theft and Depositors Forgery
“The following conditions apply to these perils:
“a. Our liability for loss in any one occurrence shall not exceed the amount stated in the declarations for that peril.
“b. All loss incidental to an actual or attempted fraudulent, dishonest or criminal act or series of related acts at the premises, whether committed by one or more persons, shall be deemed to arise out of one occurrence.”
The “policy period” is defined under “general policy conditions” to begin and end at the dates and times specified in the declarations page.
Farmland argues that, by defining a related series of losses as a single occurrence, by limiting the insurer’s liability for losses resulting from a single occurrence to the policy limits, and by providing that the limits of liability would not be cumulative from year to year, it is obvious that the parties intended to limit Farmland’s liability for an act of embezzlement by a single employee to $100,000, regardless of whether the embezzlement took place during one policy period or two.
Plaintiff responds with two arguments: (1) Because Section IIC-l-b defines an “occurrence” as related acts during the policy period, related acts occurring during two policy periods cannot constitute a single occurrence; and (2) renewal of the contract for the second policy period constituted a separate and independent contract rather than a mere continuation of the first contract.
Our consideration of plaintiffs first argument leads us to the conclusion that the additional coverage exists under Farmland’s policy. Insurance policies typically limit the insurer’s liability to a stated sum during the policy period. Insurance policies do not, however, normally limit the insurer’s liability to a stated sum during the life of the policy when the policy is renewed for additional periods by the payment of an additional premium. Normally, the insured expects the policy limits to again become available once the policy is renewed.
It would therefore seem that a reasonable person in the position of the insured would have expected, upon reading the policy, that the policy provided coverage up to $100,000 for any acts of embezzlement committed during the policy period, regardless of whether these acts were part of a series of acts originally begun during a previous policy period or ended during a later policy period, so long as the acts were discovered and reported within one year after the end of the policy period. Thus, at any given time, coverage would exist under both the existing policy and the previous policy, since the previous policy would necessarily have ended less than one year earlier.
Farmland responds that such an interpretation is based upon one clause in the policy relating to policy period which if read with other provisions of the policies will not support such an interpretation. Farmland argues that policy period provisions must be read together with II-C-1-e, which states that, regardless of the number of years the policy continues in force, the limit of liability shown on the declaration page “shall not be cumulative from year to year.”
Undoubtedly, Farmland meant to limit its liability for any losses caused by a single, dishonest employee to $100,000 but, as pointed out by plaintiff, the above language could be read merely to mean that liability under the current policy does not attach for losses occurring during prior periods. While such a construction may be strained, it does find support in several decisions. See Globe Indemnity Co. v. Wolcott & Lincoln, 152 F.2d 545, 546-49 (8th Cir. 1945); City of Miami Springs v. Travelers Indem. Co., 365 So. 2d 1030, 1031-32 (Fla. Dist. App. 1978); Great American Indemnity Co. v. State, 229 S.W.2d 850, 853 (Tex. Civ. App. 1950).
We believe that the policy can reasonably be read either to provide coverage or not to provide coverage. While the coverage question is close, Farmland has failed to clearly state within the provisions of the policy that its liability under circumstances like those in this case shall be limited to $100,000.
Whether an insured is entitled to recover the limits of liability for each year that a fidelity bond or policy is in effect when the employee’s dishonest act took place in more than one year is a question that has been the subject of decisions dating back to at least 1901. See Mayor of Brunswick v. Harvey, 114 Ga. 733, 40 S.E. 754 (1901). It has been analyzed in treatises dating back to at least 1909. See Frost, The Law of Guaranty Insurance, § 40 (2d ed. 1909). It has been the subject of law review articles dating back to at least 1928. See Note, Fidelity Bonds-Does It Pay to Renew Them?, 27 Mich. L. Rev. 442 (1928). And, it has been the subject of multiple A.L.R. annotations, the most recent being in 1949. See Annot., 7 A.L.R.2d 946; see also Docking v. National Surety Co., 122 Kan. 235, 240, 252 Pac. 201 (1927) (fidelity bond is, in effect, a contract of insurance and will be treated as such).
In spite of this attention, no clear answer has emerged. The courts that have decided the question are divided. See State ex rel. Guste v. Aetna Cas. & Sur. Co., 429 So. 2d 106, 108 (La. 1983), and cases cited therein; and Note, Insurance — Fidelity Bonds — Renewals as Affecting the Liability of Surety, 25 N. C. L. Rev. 341 (1947). It was entirely foreseeable that this question would arise under the policy as drafted by Farmland. It was also foreseeable that, without a specific policy provision addressing this problem, the policy would be strictly construed against Farmland. Yet, Farmland did not address this problem expressly and unambiguously. See Gowing, 207 Kan. at 82; and First Nat’l Bank v. Hartford Accident and Indemnity Co., 122 Kan. 334, 338, 252 Pac. 199 (1927) (“If the draftsman, when the form of policy was prepared, had in mind what the defendant now urges it certainly would not have been difficult to select language that would have made that purpose clear beyond controversy.”). By failing to limit its coverage in clear and unambiguous terms, Farmland assumed the risk that a court in this state would find coverage to exist.
Because the policy is ambiguous, because a reasonable person in the insured’s position would expect coverage to exist, and because ambiguities must be resolved in favor of the insured, we conclude that coverage exists.
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Rulon, J.:
Stephens Cattle Co., Inc., and Hoxie Feeders, Inc., plaintiffs, appeal from the district court’s dismissal, under the doctrine of forum non conveniens, of a lawsuit they instituted against Dan Hollingsworth, defendant. We conclude the district court did not abuse its discretion and affirm. The material facts are as follows:
Plaintiffs are Kansas corporations with their principal places of business in Sheridan County, Kansas. Defendant is a California resident and a partner in Hollingsworth Livestock, a California general partnership. In July of 1988, Donald R. Stephens, as agent for plaintiffs, made an oral agreement with defendant for the feeding and delivery of several head of calves. Defendant allegedly agreed to raise and deliver to the Kansas corporations, in 110 to 120 days, 160 head of calves at approximately 300 pounds each. He was to raise the calves at his feedyard in California, with Hoxie Feeders providing the feed through a California feed mill. The California feed mill was to bill Hoxie Feeders directly for this feed. Hoxie Feeders also paid for the calves, which were purchased in California. For feeding the calves, Hoxie Feeders was to pay defendant 850 per day per calf for the first 110 days, and thereafter 300 per day per calf.
In September of 1988, Donald R. Stephens, again as agent for the Kansas corporations, entered into a second oral agreement with defendant. The terms of the second agreement were identical to those of the first one. In December of 1988, Donald R. Stephens went to California to take delivery of the calves under the first contract. He could take only 70 head, as the remainder of the 160 were underweight and in generally poor condition. In January of 1989, another agent went to defendant to take delivery of the calves under the second contract. He took only 100 head, as the remainder were again underweight and in poor condition.
Plaintiffs then made demand on defendant for the purchase price of the calves they never received under the contracts. Defendant refused, alleging no agreement was ever reached on the weight of the calves at delivery. He also claims the feed delivered to him by the California mill was substandard, causing high death rates among the calves. Defendant states all the calves delivered to plaintiffs were delivered under the first contract, not some under each contract. He refused to make deliveries under the second contract when the two companies failed to pay for the feeding of the calves delivered under the first.
Plaintiffs filed an action in district court to recover the purchase price of calves never received under the contracts. The district court, after ruling it had both in rem and in personam jurisdiction of defendant, invoked the doctrine of forum non conveniens to hold the action in abeyance until further order.
THE DOCTRINE
Plaintiffs assert that Kansas has recognized the doctrine of forum non conveniens, an equitable doctrine under which a court may refuse to exercise its jurisdiction. Furthermore, plaintiffs contend that, when our Supreme Court has considered this doctrine, it has held the doctrine should not be invoked where one of the parties is a Kansas resident and opposes its application. Specifically, plaintiffs assert that only if the Kansas resident supports application of the doctrine should a Kansas court consider applying it. On the other hand, defendant argues the trial court did not abuse its discretion in applying the doctrine to the lawsuit because, while residency of the parties is a factor Kansas courts consider in determining whether the doctrine should be invoked, it is not the sole controlling factor in Kansas.
The district court found that “[t]he contracts were made in California; the alleged breach was committed in California; the cattle were delivered to Plaintiffs in California; the breach if any occurred with the delivery of the calves to Plaintiffs’ representative in California; the applicable law in the case would be California law.” The district court then invoked the doctrine of forum non conveniens to hold the action in abeyance until further order.
In Gonzales, Administrator v. Atchison, T. & S.F. Rly. Co., 189 Kan. 689, 695, 371 P.2d 193 (1962), the Kansas Supreme Court expressly made the doctrine of forum non conveniens part of the common law of Kansas. In this leading case on the doctrine in Kansas, the court discussed the purpose of and policy surrounding the doctrine. The doctrine allows a court to choose not to exercise the jurisdiction it otherwise properly possesses. Under the doctrine, a party may demonstrate that justice requires a trial to be held in a more convenient forum, but the court should not dismiss the action under the doctrine unless an alternative forum is available to the plaintiff. 189 Kan. at 691-96.
The Gonzales court adopted the factors listed in Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 506-11, 91 L. Ed. 1055, 67 S. Ct. 839 (1947), as those to consider in determining whether the doctrine should be invoked. 189 Kan. at 692-93, 696. These factors include accessibility to proof; availability of compulsory process for witnesses and the costs of their attendance; the opportunity to view the premises, if applicable; and “ ‘all other practical problems that make trial of a case easy, expeditious, and inexpensive.’ ” 189 Kan. at 693 (quoting Gulf Oil Corp., 330 U.S. at 508). Public policy requires that a community should not be burdened with jury duty when it has no relation to the litigation. Because congestion of court dockets is common, efficiency dictates that cases be litigated at their source. 189 Kan. at 693 (quoting Gulf Oil Corp., 330 U.S. at 508-09). Because exercise of the doctrine strips a plaintiff of his or her choice of forum, it should be applied only in exceptional circumstances where the factors weigh strongly in favor of the defendant. 189 Kan. at 693, 696. However, as application of the doctrine is within trial court discretion, the trial court will be reversed on appeal only when it has abused that discretion. 189 Kan. at 694.
Plaintiffs cite and discuss throughout their brief six Kansas cases which they claim support their contention that our Supreme Court applies the doctrine in cases involving a Kansas resident only when that resident supports the application.
First, plaintiffs maintain that in Farha v. Signal Companies, Inc., 216 Kan. 471, 532 P.2d 1330, modified on other grounds 217 Kan. 43, 535 P.2d 463 (1975), our Supreme Court made “the unequivocable statement” that forum non conveniens is not applicable where one party is a resident of the state. The following is the court’s entire discussion of the doctrine in Farha:
“Defendants next claim the trial court erred in overruling their motions to dismiss under the doctrine of forum non conveniens. They cite Gonzales, Administrator v. Atchison, T. & S.F. Rly. Co., 189 Kan. 689, 371 P.2d 193; Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 91 L. Ed. 1055, 67 S. Ct. 839; and Hayes v. Chicago, R.I. & P.R. Co., 79 F. Supp. 821 (D. Minn. 1948), in support of their motions. Although defendants have not emphasized this point we have carefully reviewed each of these cases. They support the rule that in order to justify a reversal of a trial court’s decision it must be found there has been an abuse of discretion. It has been recognized that the doctrine is not applicable where one of the parties is a resident of the state. It has also been held that the doctrine is usually applied to tort actions between nonresidents concerning a tort in another state, and is not usually applied to contract actions. (20 Am. Jur. 2d, Courts, § 172, 177, 178.) Since this is a contract action in which the several plaintiffs are residents of the State of Kansas we cannot say the trial court abused its discretion.” 216 Kan. at 483.
Although the court notes that some jurisdictions have refused to apply the doctrine where one party is a resident of the state, it merely cites the plaintiffs’ Kansas residency as support for its finding that the trial court did not abuse its discretion in retaining the case for trial. The Farha court did not state that Kansas is one of the jurisdictions refusing to apply the doctrine where a resident is a party.
Plaintiffs next argue Gonzales, 189 Kan. 689, essentially holds that the doctrine will not be invoked where a Kansas resident who is a party to the action opposes its application. No language in the opinion supports this contention. In Gonzales, the plaintiff was a Colorado resident and the defendant was a Kansas resident corporation. The corporation moved to invoke the doctrine and was sustained by the trial court; the Supreme Cpurt upheld the trial court. The Colorado plaintiff argued that the corporation’s residency in Kansas prevented a Kansas court from invoking the doctrine. The court clearly rebutted any notion that residency of a party is a controlling factor when it stated, “The place of corporate domicile, even though domestic as in the instant case, is a factor entitled to consideration but does not preclude dismissal of a transitory cause of action under the doctrine of forum non conveniens, which resists formalization and looks to the realities that make for doing justice.” 189 Kan. at 696-97.
Plaintiffs next cite State of Oklahoma, ex rel., v. H.D. Lee Co., 174 Kan. 114, 254 P.2d 291 (1953), in support of their interpretation of the application of the doctrine in Kansas. In this case, the plaintiff was a nonresident, while the defendant was a Kansas corporation. The Kansas corporation sought to invoke the doctrine, but the Supreme Court rejected its application. Plaintiffs here argue this decision supports their argument that Kansas invokes the doctrine only where a Kansas resident party does not oppose its application because the Kansas corporation in H.D. Lee was supporting application of the doctrine, not opposing its application. The court devoted only one short paragraph to the discussion of the doctrine, which concentrated on whether the Kansas corporation was “inconvenienced” in having to defend the suit in a Kansas court. The court noted the residency status of the corporation, but only as evidence of the corporation’s lack of “inconvenience” in defending the suit in Kansas. Our Supreme Court concluded the trial court did not abuse its discretion in retaining the case for trial. 174 Kan. at 118.
Next, plaintiffs cite Quillin v. Hesston Corp., 230 Kan. 591, 640 P.2d 1195 (1982), as further supporting their proposition. While it is true the plaintiff in Quillin was a nonresident and the defendant was a Kansas corporation which successfully sought to invoke the doctrine, the issue before the court was whether one district court could transfer to another district court a case which it had decided it would not hear pursuant to the doctrine. The Supreme Court expressly stated the issue of whether the trial court should have applied the doctrine was not before it. The court held a case could not be transferred to another district court, but only dismissed under the doctrine.
The last two cases are not fully discussed, but only cited by the plaintiffs in their brief. The court in Panhandle Eastern Pipe Line Co. v. Herren, 207 Kan. 400, 485 P.2d 156, modified on other grounds 208 Kan. 119, 490 P.2d 416 (1971), does discuss whether the district court’s action in dismissing the case under the doctrine was proper. However, the court concentrates on whether an alternative forum existed in which the plaintiff corporation could obtain relief. No statement in the opinion was found concerning corporate residency. The corporation filed suit in Reno County against various Kansas defendants to recover taxes paid under protest to the Reno County treasurer, after it had earlier filed an action in Johnson County appealing an assessed valuation of its tangible property in Kansas. The Reno District Court dismissed the action filed there, stating that under the doctrine of forum non conveniens, Johnson District Court was the proper forum to provide relief. The Supreme Court concluded that because Johnson District Court could not give relief for the cause of action filed in Reno. District Court, dismissal there under the doctrine was improper. 207 Kan. 403-05.
The last Kansas case cited by plaintiffs is Lambertz v. Abilene Flour Mills Company, Inc., 209 Kan. 93, 495 P.2d 914 (1972). The issue in this case did not deal with the doctrine of forum non conveniens, but with which one of the two Kansas counties had proper venue under the venue statutes. The court did discuss the doctrine briefly, but did not rely on it for the decision. The court applied the venue statutes to decide the case and appears to have discussed the doctrine only for analogy. 209 Kan. at 95-98.
Plaintiffs summarize their discussion of these Kansas cases by stating these cases support the legal proposition that if a Kansas resident is a party to a lawsuit and opposes the application of the doctrine to that lawsuit, it will not be applied. We believe the above cases do not support plaintiffs’ contention. Where the Kansas Supreme Court discussed whether the doctrine should be applied in these cases, it decided the issue in light of the factors and public policy considerations discussed in Gonzales, 189 Kan. at 689. Our Supreme Court has never given primary emphasis to whether one of the parties is a Kansas resident and whether that party supports or opposes the application of the doctrine.
The district court’s application of the doctrine of forum non conveniens should be reversed only if this court concludes the district court abused its discretion. Gonzales, 189 Kan. at 694. Here, the district court clearly found that all negotiations and actions pertaining to the two contracts occurred in California. The calves were purchased, fed, and delivered to the plaintiffs in California. The calves were fed with feed from a California mill. Any breach of the contracts occurred in California. California law is therefore the governing law of the case. Plaintiffs do not dispute these findings. They merely claim that, because defendant has litigated jurisdictional issues in Kansas courts, he would not be “inconvenienced” by trial in Kansas. Although plaintiffs may have to transport some evidence and witnesses for trial in California, we are unable to conclude that no reasonable person would have applied the doctrine of forum non conveniens in this case.
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Davis, J.:
The defendant, Theresa A. Miller; filed a motion to dismiss the auto negligence action filed by Laura E. Read based upon the statute of limitations. The trial court denied the motion and certified its order for interlocutory appeal. We granted permission to appeal and hold that plaintiffs action is time-barred. We therefore reverse and remand with directions to dismiss plaintiff’s action.
The facts are not in dispute. Plaintiff Laura Read and defendant Theresa Miller were involved in an automobile accident in Leavenworth County on September 20, 1986. Exactly two years later, on the day the statute of limitations expired (K.S.A. 1989 Supp. 60-513[a] [4]), plaintiff filed her action in Wyandotte County.
The summons for defendant which listed defendant’s address as “Rural Route 2 Box 61 V, Bonner Springs, Kansas,” 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, stating in part:
“2. The plaintiff believed defendant resided in Wyandotte County, Kansas. However, it has been determined that the defendant resides in Leavenworth County, Kansas.
“3. An Alias Summons has been issued to the Sheriff of Leavenworth County, Kansas.”
That same day, Judge Zukel signed the following order:
“The Court, being well and fully advised in the premises, finds that for good cause shown the plaintiffs Motion should be granted. The time for obtaining service of process is enlarged for a period of thirty (30) days.”
The question presented is when plaintiffs action was commenced. We believe that the answer to this question depends upon the proper construction of K.S.A. 60-203(a).
The trial court held, however, that the extension could be granted independently of K.S.A. 60-203(a) under the provisions of K.S.A. 1989 Supp. 60-206(b)(2). We first consider whether the trial court’s application of K.S.A. 1989 Supp. 60-206(b)(2) was correct.
Application of K.S.A. 1989 Supp. 60-206(b)
K.S.A. 1989 Supp. 60-206(b)(2) provides:
“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.”
Defendant argues that this statute does not apply because the specific language in K.S.A. 60-203(a) controls over the general language in K.S.A. 1989 Supp. 60-206(b)(2). Defendant’s point is well taken. Our Supreme Court has held:
“It is a cardinal rule of law that statutes complete in themselves, relating to a specific thing, take precedence over general statutes or over other statutes which deal only incidentally with the same question or which might be construed to relate to it. Where there is a conflict between a statute dealing generally with a subject, and another dealing specifically with a certain phase of it, the specific legislation controls.” Szoboszlay v. Glessner, 233 Kan. 475, 479, 664 P.2d 1327 (1983).
We applied this rule to a similar question in Stanton v. KCC, 2 Kan. App. 2d 228, 577 P.2d 367, rev. denied 225 Kan. 845 (1978). The appellants filed a notice of appeal out of time along with an application to the trial court for an extension of time based on excusable neglect. The trial court granted permission to file the appeal out of time. 2 Kan. App. 2d at 229. This court dismissed, explaining:
“Unless legislative intent appears otherwise, a special statute which relates to particular persons or things will take precedence over a statute dealing with a subject in general. [Citations omitted.] K.S.A. 60-206 . . , is a statute of general application, whereas K.S.A. 60-2103 ... is a statute dealing specifically with appellate procedure. Although subsection (b) of the former does provide for the enlargement of time for an act to be done where the failure to act was the result of excusable neglect, the latter permits an extension of time in which to take an appeal only upon a showing of excusable neglect based on failure of a party to learn of the entry of judgment. There is nothing in the record or elsewhere to our knowledge -to indicate anything but that the legislature intended the specific provisions of K.S.A. 60-2103 to take precedence. We conclude that, in the absence of an affirmative showing that failure to file the notice of appeal wfthin.'the prescribed thirty-day period was because of failure to learn of the entry of judgment, the district court was without authority to grant the extension of time.” 2 Kan. App. 2d at 229-30.
In Schroeder v. Urban, 242 Kan. 710, 711-12, 750 P.2d 405 (1988), the Supreme Court approved our decision in Stanton v. KCC; however, the court also recognized a “unique circumstances” exception to our holding. If a trial court .grants an extension of time for filing a notice of appeal, an appeal filed during the extended period will be deemed timely filed, even though the trial court had no authority to extend the appeal period, if the extension was granted prior to the expiration of the original appeal period and the appellants relied to their detriment on the purported extension. This exception has no application to this case.
K.S.A. 60-203(a) contains specific provisions regarding an extension of time. These specific provisions control over the general provisions in K.S.A. 1989 Supp. 60-206(b).
Application of K.S.A. 60-203(a)
Both patties rely upon K.S.A. 60-203(a), which provides:
“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 or the first publication is made for service by publication 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 or first publication, if service of process or first publication is not made within the time specified by provision (1).”
Defendant argues that the 30-day extension must be sought and granted before the 90-day period has expired. Plaintiff counters that, if the legislature had so intended, it would have said so expressly in the statute. Plaintiff instead argues that the 30-day extension may be sought and granted any time within 120 days after the petition is filed.
The rules this court must apply in construing statutes are well known. The fundamental rule of statutory construction, to which all others are subordinate, is that the intent of the legislature governs when- that intent can be ascertained from the statute. Taylor v. Perdition Minerals Group, Ltd., 244 Kan. 126, 133, 766 P.2d 805 (1988); Harris Enterprises, Inc. v. Moore, 241 Kan. 59, 65, 734 P.2d 1083 (1987). Where the language of the statute is plain and unambiguous, the court must give effect to the intent of the legislature as expressed. Brasel v. State Board of Pharmacy, 238 Kan. 866, 869, 714 P.2d 1387 (1986); Layton v. Heinlein, 14 Kan. App. 2d 104, 106, 782 P.2d 1254 (1989). In determining whether the language of the statute 4s clear or ambiguous, words and phrases should be construed according to the context axid the approved usage of the language. Words and phrases ip common use should be given their natural and ordinary meaning. Kansas Gas & Electric Co. v. Kansas Corporation Comm’n, 239 Kan. 483, 503, 720 P.2d 1063 (1986); Brasel, 238 Kan. at 869; Hessell v. Lateral Sewer District, 202 Kan. 499, 502, 449 P.2d 496 (1969) (citing K.S.A. 77-201 Second).
The key word in K.S.A. 60-203(a)(l) is “extend.” The meaning of “extend” is settled in both the English language and the law. “To extend is to stretch, or stretch out.” Bank v. Heslet, 84 Kan. 315, 317, 113 Pac. 1052 (1911) (citing Webster’s New International Dictionary). When 90 days expire with no extension, there is nothing left to extend, or stretch out. This accords both with the natural meaning of the words “extend” and “extension” and with the few cases touching on the subject. As the Tennessee Supreme Court has held:
“To extend means to stretch out or to draw out or to enlarge a thing. It implies something in existence. Extend is a transitive verb, requiring an object. The object of the extension in the statute is the forty-five days. The forty-five days having elapsed, there is nothing to extend, no period to prolong.” Leather Co. v. Gillespie, 157 Tenn. 166, 167, 6 S.W.2d 328 (1928).
The Missouri Supreme Court has similarly held:
“The word ‘extension’ ordinarily implies the existence of something to be extended. Thus in the Scott and Paul cases, just cited in the margin, this court held a trial court could not extend the time for filing a bill of exceptions beyond the time already fixed, if such extension was granted after expiration of the time first limited. The Scott case said: ‘The word “extended” as employed in this statute . . . means “prolonged”; and of course a prolongation of time cannot occur after the time originally limited has expired.’ ” State v. Graves, 352 Mo. 1102, 1110, 182 S.W.2d 46 (1944).
We recognize that, in determining legislative intent, the literal meaning of the words used is not always controlling and that courts are not limited to consideration of the language used in the statute, but may 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. In re Marriage of Schoneman, 13 Kan. App. 2d 536, 539, 775 P.2d 194, rev. denied 245 Kan. 784 (1989); Citizens State Bank of Grainfield v. Kaiser, 12 Kan. App. 2d 530, 536, 750 P.2d 422, rev. denied 243 Kan. 777 (1988). These considerations do not lead us to a different conclusion.
The 1983 amendments to K.S.A. 60-203 made changes to what is now subsection (a) and added subsection (b). Subsection (b) provides:
“If service of process . . . purports to have been made within the time specified by subsection (a)(1) but is later adjudicated to have been invalid due to any irregularity in form or procedure or any defect in making service, the action shall nevertheless be deemed to have been commenced by the original filing of the petition if valid service is obtained . . . within 90 days after that adjudication, except that the court may extend that time an additional 30 days upon a showing of good cause by the plaintiff.” K.S.A. 60-203(b).
The Supreme Court interpreted this subsection in Hughes v. Martin, 240 Kan. 370, 374-76, 729 P.2d 1200 (1986). The court found that, by enacting subsection (b), the legislature intended to reverse the results of such cases as Bray v. Bayles, 228 Kan. 481, 618 P.2d 807 (1980), and Briscoe v. Getto, 204 Kan. 254, 462 P.2d 127 (1969).
It is not clear from the legislative history, previous appellate opinions, or the comments of legal authorities why the legislature authorized a 30-day extension in subsection (a). We are aware that subsection (a) and subsection (b) have language in common: Both provide that the court may “extend” a 90-day period “an additional 30 days upon a showing of good cause by the plaintiff.” And, considering that the two subsections were amended by the same bill, we must assume that the legislature had some of the same considerations in mind when it amended both subsections.
The two subsections apply, however, to different situations: Under subsection (b), the defendant has been served, albeit defectively, and has notice that an action has been brought against him; under subsection (a), the defendant has not been served and has no notice that an action has been filed. The language in subsection (a) is also clear: “[T]he court may extend that time [the 90 days] an additional 30 days upon a showing of good cause by the plaintiff.” As we have already seen, once the 90-day period has expired, there is nothing to extend, and no period to prolong.
In this case, plaintiffs cause of action became barred on the 91st day after her petition was filed. As of the 91st day, service had not been made “within the time specified by provision (1),” that is, within “90 days after the petition is filed,” and no ex tension had yet been granted. Under the provisions of K.S.A. 60-203(a)(2), plaintiffs action would therefore be deemed to have commenced upon “service of process.” Since “service” was beyond the last day of the statute of limitations, plaintiffs action was commenced after the statute of limitations had expired. See Newell v. Brollier, 239 Kan. 587, 588, 722 P.2d 528 (1986) (“If service is made later than the specified time period, the action is commenced on the date service is obtained.”).
Plaintiffs reliance upon Newell v. Brollier for the proposition that K.S.A. 60-203(a) provides a 120-day period for service of process is misplaced. While 120 days’ cumulative time under 203(a) may be granted, Newell clearly holds that, under 60-203(a), the “action shall be deemed commenced on the date the petition is filed if service is made within 90 days of the filing of the action (or 120 days if extended by the court).” (Emphasis added.) 239 Kan. 587, Syl. ¶ 2.
Although the trial court granted a 30-day extension after the expiration of the 90 days, plaintiffs action was not revived by a retroactive extension. Defendant has “a vested right” in the statute of limitations defense. Jackson v. American Best Freight System, Inc., 238 Kan. 322, 325, 709 P.2d 983 (1985). This defense may not be taken away and plaintiffs action revived by a retroactive extension of the period for obtaining service of process.
In reaching our conclusion, we have considered plaintiffs argument that K.S.A. 60-203(a) should be liberally construed to permit a decision on the merits in this case. K.S.A. 60-102 requires us to construe the code of civil procedure liberally “to secure the just, speedy and inexpensive determination of every action or proceeding.” This does not mean, however, that every case must be decided on its merits. Perhaps the best answer to plaintiffs argument is found in Welch v. City of Kansas City, 204 Kan. 765, 771, 465 P.2d 951 (1970):
“[T]he plaintiffs insist that the ends of justice would be served by granting them their day in court, despite the fact their action was commenced out of time. The same suggestion, we presume, could be advanced by every litigant who by inattention, inadvertence or otherwise, had let the time slip by for bringing his lawsuit.
“It has been said that statutes of limitation are statutes of repose, precluding presentation of stale claims and encouraging diligence on the part of those whose rights have been infringed. In furthering these objectives, such statutes serve a worthy and useful purpose, and we are not at liberty to ignore them completely.”
Based on the plain, unambiguous language of K.S.A. 60-203(a), and considering existing case law rules and the lack of any legislative intent to the contrary, we hold that an extension of time under K.S.A. 60-203(a) must be sought and granted before the expiration of the 90-day period.
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Rees, J.:
This is an action initiated by plaintiff Adam Wayne Gifford against defendant Farm Bureau Mutual Insurance Company to recover benefits under underinsured motorist (UIM) coverage provided to him by a Farm Bureau automobile liability policy. It is a direct action in contract by an insured against his insurer. The only parties to the action are Gifford and Farm Bureau. The purported tortfeasor, Marty K. McAlexander, is not a party to the action. Neither Gifford nor Farm Bureau has brought or sought to bring McAlexander’s liability insurer, Gulf Insurance Company, or any other person or entity, into the action as an additional party. No one has intervened or sought to intervene. There has been no trial. Gifford appeals from the trial court’s order dismissing the action against Farm Bureau. We reverse.
Underlying the action is a one-vehicle accident resulting in bodily injury to Gifford. The vehicle involved was driven by McAlexander. Gifford was a passenger. Gifford alleges that McAlexander was guilty of negligence and that McAlexander’s negligence was the cause of the accident. Whether McAlexander was negligent and the amount of Gifford’s damages are questions not yet adjudicated.
McAlexander is afforded liability coverage under an automobile liability policy issued by Gulf. The limit of Gulf s liability coverage is $50,000. The limit of Farm Bureau’s UIM coverage is $100,000. Claiming that his damages exceed $50,000, Gifford seeks recovery against Farm Bureau for the amount of his bodily injury damages that are in excess of $50,000 but not to exceed Farm Bureau’s $100,000 UIM coverage limit.
For present purposes, Gifford is a UIM insured; Farm Bureau is a UIM insurer; McAlexander is an underinsured tortfeasor; and Gulf is the tortfeasor’s liability insurer.
Prior to his initiation of this action, Gifford gave notice to Farm Bureau that he had reached a tentative agreement with McAlexander to settle for Gulfs liability limit. In the language of K.S.A. 1989 Supp. 40-284(f), the UIM insured (Gifford) reached a tentative agreement with the underinsured tortfeasor (McAlexander) to settle for the tortfeasor’s liability limit ($50,000). The UIM insured (Gifford) gave written notice of the tentative agreement to settle to his UIM insurer (Farm Bureau) in the manner and as prescribed by K.S.A. 1989 Supp. 40-284(f). The UIM insurer (Farm Bureau) did not substitute its payment to the UIM insured (Gifford) for the tentative settlement amount ($50,000) within 60 days of receipt of the written notice. In fact, Farm Bureau expressly declined to make substitute payment to Gifford. Thereafter, Gulf, on behalf of its insured (McAlexander, the underinsured tortfeasor), paid the full $50,000 limit of its liability coverage in exchange for Gifford’s release of McAlexander and Gulf.
Assuming appropriate policy language, K.S.A. 40-287 and K.S.A. 1989 Supp. 40-284(f) operate to grant and assure to a UIM insurer the right of subrogation to any cause of action in tort which a UIM benefits payee may have against any other person legally responsible for the bodily injury because of which payment of UIM benefits is made. The UIM insurer’s subrogation right extends .to the proceeds of any settlement resulting from the exercise of any rights of recovery by the UIM benefits payee against any person legally responsible for the bodily injury for which payment is made by the UIM insurer. The extent of the UIM insurer’s subrogation right is limited to the amount of UIM coverage benefits paid to the UIM insured. However, as provided by K.S.A. 1989 Supp. 40-284(f), where a UIM insurer fails to make timely substituted payment in response to a notice of tentative agreement with a tortfeasor to settle for the tortfeasor’s liability limit, the UIM insurer “has no right of subrogation for any amount paid under the [UIM] coverage.”
The trial court refused to find that K.S.A. 1989 Supp. 40-284(f) authorizes a direct action by a UIM insured against its insurer. It held that K.S.A. 1989 Supp. 40-284(f) concerns only the subrogation rights of UIM insurers. We find K.S.A. 1989 Supp. 40-284(f) and K.S.A. 40-287 are unambiguous and we agree that, in an action involving UIM benefits, K.S.A. 1989 Supp. 40-284(f) concerns only the subrogation right of the UIM insurer.
The trial court order of dismissal was announced in the following language:
“Farm Bureau [a UIM insurer] asserts that it cannot be involuntarily named as a defendant in an underinsured motorist action. Farm Bureau asserts that plaintiff [the UIM insured] has not named the driver of the alleged underinsured vehicle [the underinsured tortfeasor] as a defendant as required by law, and that [a UIM] insurer may only become a defendant in an underinsured motorist action if the [UIM] insurer itself elects to intervene in an existing action brought by the injured party [the UIM insured] against the [underinsured] tortfeasor. Farm Bureau requests that the action brought by plaintiff be dismissed.
“The Court finds that Farm Bureau’s motion to dismiss should be granted. In Haas v. Freeman, 236 Kan. 677, 693 P.2d 1199 (1985), the Kansas Supreme Court set forth procedures to be followed in an underinsured motorist action. In Haas, the Supreme Court found that [a UIM insurer] cannot be involuntarily named as a defendant in an [underinsured motorist] action.
“Plaintiff argues that K.S.A. 40-284(f), which was enacted subsequent to the decision in Haas, authorizes direct actions against underinsured motorist carriers. However, the Court finds that K.S.A. 40-284(f) only concerns the subrogation rights of underinsured carriers. The statute is not inconsistent with the decision in Haas and does not change existing law. Accordingly, the Court finds that the proper defendant is not named herein, and this action should be dismissed as against Farm Bureau.”
Before us, Farm Bureau capsulizes its position in this language taken from its brief:
“Kansas law does not permit an injured party to initiate an action directly against the party’s underinsured motorist carrier. The right to intervene in an existing action against the alleged [underinsured] tortfeasor is the exclusive right of the [UIM] insurer. Farm Bureau has been improperly named in this action as a defendant, and plaintiff has failed to sue the truly indispensable party to this action, the alleged [underinsured] tortfeasor. Accordingly, the district court was correct in dismissing plaintiffs action against Farm Bureau.”
The foundation of Farm Bureau’s position has been and is Haas v. Freeman, 236 Kan. 677, 693 P.2d 1199 (1985). Likewise, Haas was the foundation of the trial court’s decision to dismiss. Thus, that opinion must be examined with care.
“[Statements in a judicial opinion or syllabus thereof must be read and interpreted in light of the issue involved and the facts giving rise to what is said (Ellis v. Union Pacific R. R. Co., 231 Kan. 182, 185, 643 P.2d 158 [1982]; McKinney, Administrator v. Miller, 204 Kan. 436, 437, 464 P.2d 276 [1970]; Ives v. Kansas Turnpike Authority, 184 Kan. 134, 144, 334 P.2d 399 [1959]; Steck v. City of Wichita, 182 Kan. 206, 209, 319 P.2d 852 [1958]; State v. Six Slot Machines, 166 Kan. 361, 365, 201 P.2d 1039 [1949]).” Hartman v. Nordquist, 8 Kan. App. 2d 213, 214-15, 653 P.2d 1199 (1982).
“What is said in an opinion or the syllabus thereof always is to be read and interpreted in the light of the facts and questions present in the case. [Citations omitted.] Otherwise, language meaningful for one case may erroneously become dogma for other cases despite essential differences. McKinney, Administrator v. Miller, 204 Kan. 436, 437, 464 P.2d 276 (1970).” State v. Reed, 8 Kan. App. 2d 615, 623-24, 663 P.2d 680 (Rees, J., dissenting and concurring), rev. denied 234 Kan. 1077 (1983).
Haas, 236 Kan. 677, was a tort action that came before the Supreme Court on interlocutory appeal. The factual and procedural background of Haas is described in the opinion as follows:
“[Defendant] Mark S. Freeman and [plaintiff] Harlan A. Haas were involved in an automobile accident with each other. As a result of the accident, Haas suffered physical injuries. Haas brought suit against Freeman for recovery of his damages.
“During the initial stages of the action, it was discovered Mark Freeman was an underinsured motorist. At the time of the accident, Freeman had a policy of insurance with Farmers Insurance Company for automobile liability coverage .... At the time of the collision Haas had in effect an insurance policy with Horace Mann Insurance Company for [UIM] coverage .... Haas was granted a motion to amend his petition to bring suit against Horace Mann Insurance Company, contending Freeman was an underinsured motorist. Horace Mann filed a motion to be dismissed from this suit. The district court dismissed Horace Mann Insurance Company from the suit, but held it would be bound by any judgment rendered in the action above appellee Freeman’s [liability] insurance limits.” 236 Kan. at 678.
The Supreme Court determined that, in Haas, “[t]he primary issue raised by appellant’s interlocutory appeal [was] whether a plaintiff s insurance company may be included in an action against a tortfeasor when the tortfeasor is an underinsured motorist.” 236 Kan. at 678. In other words, the Supreme Court found the primary issue confronting it in Haas was whether a UIM insurer may be made, or included as, a named party in an action prosecuted by a UIM insured against the underinsured tortfeasor. That is not the primary issue in the present case. This is not an action brought by a UIM insured against the underinsured tortfeasor; it is an action brought by a UIM insured against its UIM insurer. That distinction flaws the vitality of Haas as controlling authority here.
In Haas, the Supreme Court observed that Winner v. Ratzlaff, 211 Kan. 59, 505 P.2d 606 (1973), “stands for the proposition that a plaintiff may include his own insurance company in a suit against a tortfeasor where there is an issue of uninsured motorist coverage.” (Emphasis added.) 236 Kan. at 680. It further observed it had noted in Winner that “ ‘[m]ultiple litigation is never desirable and there is a public interest economically in avoiding it whenever possible to do so ii; a fair and workable manner.’ 211 Kan. at 65.” 236 Kan. at 682.
Nonetheless, the Supreme Court ultimately had this to say in Haas:
“We reiterate our previous conclusions in Winner that all issues in a. lawsuit should be tried in one trial. Multiplicity of suits does not promote substantial justice. Thus, the issues in cases involving uninsured motorists and underinsured motorists should be tried in one lawsuit. However, we are persuaded underinsured motorist claims are sufficiently distinguishable from uninsured motorist claims to require different procedures.” 236 Kan. at 682.
The “rule” of Haas is then pronounced as follows:
“[I]n an action involving an underinsured motorist, the parties shall proceed as follows:
“When the litigant determines the opposing party’s liability coverage is below the litigant’s liability coverage as well as the amount of damages claimed, and he wishes to invoke the underinsured motorist clause of his insurance policy, he shall notify his insurance carrier in the manner prescribed in the insurance policy.
“The insurance company may then intervene in the case at its election. If it elects to intervene, it shall be a named party to the action. If the insurance company elects not to intervene, K.S.A. 60-454 is applicable. In either case the litigant’s underinsured motorist insurance carrier is bound by any judgment obtained in the action.” 236 Kan. at 682-83.
We pause to consider that part of the Haas “rule” that reads “[i]f the [UIM insurer] elects not to intervene, K.S.A. 60-454 is applicable. ”
K.S.A. 60-454 provides that “[e]vidence that a person was, at the time a harm was suffered by another, insured wholly or partially against loss arising from liability for that harm is inadmissible as tending to prove negligence or other wrongdoing.” On its face, K.S.A. 60-454 does not proscribe the introduction into evidence of all evidence of liability insurance. The statute has limited applicability. It proscribes the use of evidence of liability insurance as proof of the insured tortfeasor’s negligence or other wrongdoing. It does not exclude evidence of liability insurance where relevant upon an issue other than that of the insured’s conduct. Advisory Committee Notes, 1 Gard’s Kansas C. Civ. Proc. 2d Annot. § 60-454, p. 188 (1979). It has been said that “evidence of insurance is inadmissible only ’as tending to prove negligence or wrongdoing.’ Consequently, if relevancy can be justified on another basis, the exclusionary rule is discarded for lack of application.” Slough, Relevancy Unraveled, 5 Kan. L. Rev. 675, 713 (1957).
We conclude that the appearance of the reference to K.S.A. 60-454 in the Supreme Court’s exposition of the Haas “rule” demonstrates that the “rule,” as expressed, is to be limited to Haas’ factual framework. The Haas “rule” applies in those cases involving a claim for UIM benefits asserted incident to an action initiated by a UIM insured against the underinsured tortfeasor. In such a case, where the UIM insurer elects not to intervene, K.S.A. 60-454 operates to exclude evidence of the underinsured tortfeasor’s liability insurance as proof of the tortfeasor’s negligence or other wrongdoing. That seems to be the construction adopted by the Notes of Decisions author in 1 Gard’s Kansas C. Civ. Proc. 2d Annot. § 60-454, p. 152 (1990 Supp.).
In the arguments made to us by the parties we are told that K.S.A. 1989 Supp. 40-284(f) was enacted to afford relief where an impasse arises in UIM claim settlement negotiations. It is asserted that with some frequency an impasse arises in catastrophic injury cases because the bodily injury claimant and UIM insured is unable to enter into settlement with the tortfeasor’s liability insurer for payment of the liability insurer’s limit without giving a full release to the tortfeasor and its liability insurer thereby “voiding” the claimant’s UIM coverage upon the UIM insurer’s assertion of its policy’s coverage exclusion clause. The exclusion clause in Farm Bureau’s policy here is in this simple language:
“We do not provide coverage under this Part [PART III - UNINSURED/ UNDERINSURED MOTORISTS] for bodily injury sustained by any person:
1. If that person . . . accepts a settlement . . . for a bodily injury claim that prejudices our right to recover payment . . . .”
Although it appears from the record before us that Farm Bureau’s exclusion clause would be operative because of Gifford’s release of McAlexander and Gulf, we need not pursue the subject of policy “voidance”. inasmuch as the subject is not material to our resolution of this appeal. Nonetheless, we note that Farm Bureau has not asserted reliance upon the exclusion clause as an affirmative defense. See generally Central Security Mut. Ins. Co. v. DePinto, 235 Kan. 331, 335, 681 P.2d 15 (1984); Alliance Life Ins. Co. v. Ulysses Volunteer Firemans Relief Assn, 215 Kan. 937, 943, 529 P.2d 171 (1974); Krug v. Millers’ Mutual Insurance Ass’n, 209 Kan. 111, 117-18, 495 P.2d 949 (1972). Further, if we were to pursue the subject, we would be confronted with the presently unaddressed question of whether enforcement of the exclusion clause would contravene public policy (see Horace Mann Ins. Co. v. Ammerman, 630 F. Supp. 114, 118 [D. Kan. 1986]).
We know of and have been referred to no statutory or case authority that supports Farm Bureau’s broad assertion that an injured party’s initiation of an action directly against the party’s underinsured motorist carrier is not permitted by Kansas law. The Haas “rule” does not support that proposition. It applies to an action prosecuted by a UIM insured against an underinsured tortfeasor. We are aware of no authority prohibiting a first-party action by a UIM insured against its UIM insurer.
We agree with Farm Bureau that the right of a UIM insurer to intervene in an existing action brought by a UIM insured against the alleged underinsured tortfeasor is the right of the UIM insurer. But the UIM insurer’s right of intervention is not involved in the case before us. Here, the existing action is one brought by the UIM insured against the UIM insurer, not the alleged underinsured tortfeasor. Beyond that, neither voluntary intervention nor involuntary intervention (if there be such a creature) has been attempted or sought here.
Farm Bureau has not demonstrated impropriety in the naming of it as the defendant in this action. Neither have we been shown why it is that McAlexander, the underinsured tortfeasor, is an indispensable party to this action who must be sued by Gifford, the UIM insured. Although the question of McAlexander’s negligence is one that must be adjudicated ultimately, Gifford is in no position to sue McAlexander. Having released McAlexander, Gifford has no actionable claim for relief against McAlexander. Because the release has been given, were Gifford’s counsel to name McAlexander as a defendant, the propriety of her professional conduct would be open to question.
As established by Winner, recovery of benefits by an injured party may be sought by bringing a direct action against that party’s uninsured motorist insurer. 211 Kan. at 65. Neither Haas nor Farm Bureau’s arguments persuade us that the procedure is inapplicable in UIM litigation. Haas does no more than create a procedural variation from Winner where an action is initiated by a UIM insured against the underinsured tortfeasor.
It is clear to us that the Haas “rule” has been misapplied here.
It is suggested that, if this action proceeds in its present posture, a jury will be presented with a confusing panorama that “could so overemphasize the insurance feature of the lawsuit the real issues would become unimportant.” Haas, 236 Kan. at 682.
There is no reason to suspect that a jury is incapable of following and will not follow proper and appropriate instructions. Pursuant to Nail v. Doctor’s Bldg., Inc., 238 Kan. 65, 66-68, 708 P.2d 186 (1985), and Thomas v. Board of Trustees of Salem Township, 224 Kan. 539, 551, 582 P.2d 271 (1978), Kansas juries are routinely instructed on the theory of comparative negligence and the effect of their answers. See PIK Civ. 2d 1990 Supp. 20.01. If in a comparative negligence case it is appropriate to instruct a jury as to the theory of comparative negligence and the effect of its answers, it strikes us that it is no less appropriate to instruct a jury on the several facets of a UIM claim and to expect the jury to return a proper verdict or answers to special questions. It must be assumed that a jury is reasonably intelligent. Mackey v. Board of County Commissioners, 185 Kan. 139, 150, 341 P.2d 1050 (1959).
We hold that the trial court’s order of dismissal is erroneous.
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Brazil, J.:
Michelle Durrett appeals a decision of the district court ordering her to pay intervenor United Services Automobile Association (USAA) $10,000, pursuant to a subrogation clause in her automobile insurance policy. She contends that subrogation of medical payments made pursuant to a seat belt endorsement in her automobile policy was expressly prohibited by K.A.R. 40-1-20. We reverse and remand with directions to enter judgment for Durrett.
Durrett and Richard Bryan, not a party to this appeal, were involved in an automobile accident. At the time of the accident, Durrett was insured under a policy of insurance issued to her by USAA. USAA paid Durrett $5,014.59 in personal injury protection (PIP) benefits and $10,000 in medical benefits pursuant to a policy endorsement titled “SEAT BELT BENEFITS ENDORSEMENT.” This seat belt endorsement provided that, if the insured was covered by personal injury protection at the time of an accident and was injured while wearing a seat belt, USAA would provide additional medical benefits. Specifically, USAA agreed to “pay up to $10,000 for reasonable expenses incurred for necessary medical services caused by bodily injury sustained by a covered person in an automobile accident.” The seat belt endorsement further provided that its coverage was “subject to all provisions of the policy,” which included a subrogation clause. The parties agree Durrett paid no additional premium for this endorsement coverage.
Durrett subsequently filed suit against Bryan and recovered a judgment of $123,325.34 of which $17,778.76 was for past medical expenses and $2,000.00 was.for future medical expenses. The jury found Durrett 20 percent at fault and the court reduced the damages to be awarded her by that percentage, to $98,660.28.
USAA filed a motion to intervene in the case, seeking, recovery of the benefits it had paid Durrett and claiming a lien on the proceeds of Durrett’s judgment award against Bryan. USAA then filed a motion for summary judgment in the case. The memorandum submitted in connection with the motion shows both parties agreed that, pursuant to K.S.A. 1989 Supp. 40-3113a, USAA was subrogated to and had a valid lien for the duplicative PIP benefits paid Durrett. But, Durrett argued as a matter of law that K.A.R. 40-1-20 expressly prohibited any clause in an insurance contract providing for subrogation of medical benefits. Both parties agreed that no material facts were in dispute. The trial court granted USAA’s motion for summary judgment, awarding it recovery of the entire $10,000.
Durrett does not contend that any material facts were still in dispute when the trial court granted summary judgment to USAA. She maintains instead that the trial court erred because, as a matter of law, USAA was not entitled to a favorable judgment. “This court’s review of conclusions of law is unlimited.” Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
Durrett contends that the clause in the insurance contract under which USAA claimed a right to recover the benefits it paid her was a subrogation clause expressly prohibited by K.A.R. 40-1-20. That regulation provides: “An insurance company shall not issue contracts of insurance in Kansas containing a ‘subrogation’ clause applicable to coverages providing for reimbursement of medical, surgical, hospital or funeral expenses.” We note that the legislature has provided for subrogation of PIP benefits. K.S.A. 1989 Supp. 40-3113a.
In their briefs, both parties agreed that the seat belt endorsement provided medical benefits coverage, and not additional PIP medical coverage, and that the insurance clause providing for recovery of benefits was a subrogation clause. But, at oral argument, USAA contended the endorsement provided extended PIP benefits. “Extended insurance” is a term of art that has no relevance in this case.
“Extended insurance is that where the insurance originally contracted for is continued for such period as the amount available therefor will pay when it will terminate; whereas paid-up insurance means that no more payments are required, and consists of insurance for life in such an amount as the sum available therefor, considered as a single and final premium, will purchase. In other words, ‘paid-up insurance’ is insurance for the life of the insured, upon which all the premiums have been paid, whereas ’extended insurance’ is insurance for the full amount of the policy for the period contemplated by a nonforfeitable table.” 6 Couch on Insurance 2d § 32:137 (rev. ed 1985).
What USAA probably meant to argue was that the seat belt endorsement provided excess PIP medical benefits. Excess PIP medical benefits would be all PIP medical benefits coverage in excess of the $4,500 minimum required by the Kansas Automobile Injury Reparations Act (KAIRA), K.S.A. 40-3101 et seq.
The right of subrogation under K.S.A. 1989 Supp. 40-3113a(b) to excess PIP medical benefits was considered in Hall v. State Farm Mut. Auto. Ins. Co., 8 Kan. App. 2d 475, 661 P.2d 402, rev. denied 233 Kan. 1091 (1983). When Hall was decided, $2,000 was the minimum PIP benefit required by KAIRA. State Farm’s policy offered six different levels of PIP coverage ranging from $2,000 to $25,000. The plaintiff contracted for $25,000 coverage, and this court concluded that the medical benefits provided beyond $2,000 were excess PIP benefits subject to subrogation under 40-3113a(b). 8 Kan. App. 2d at 482.
As one commentator has noted, after Hall, “[i]nsurers may choose to denominate any excess medical coverage purchased by the insured as ‘PIP Coverage,’ thereby creating a statutory right to subrogation of all PIP benefits paid the insured.” Jerry, Recent Developments in Kansas Insurance Law: A Survey, Some Analysis, and Some Suggestions, 32 Kan. L. Rev. 287, 341 (1984).
Unlike the policy in Hall, the insurance policy in the present case did not denominate the seat belt endorsement as PIP coverage. The PIP endorsement was an entirely separate endorsement providing only the minimum $2,000 in medical benefits coverage. The policy is not unusual in also providing a section titled “medical payments coverage” entirely separate from the PIP endorsement. We conclude that the seat belt endorsement provided medical benefits coverage, not excess PIP benefits.
. Both parties also agree that K.A.R. 40-1-20, if validly promulgated, would seem to prohibit the application of a subrogation clause in Kansas where medical benefits are involved. USAA, however, maintains the Kansas Insurance Department exceeded statutory authority in promulgating K.A.R. 40-1-20, and so the regulation is void and of no effect.
The Kansas Insurance Department, which promulgated K.A.R. 40-1-20, is an administrative agency.
“Administrative agencies are creatures of statute and their power is dependent upon authorizing statutes, therefore any exercise of authority claimed by the agency must come from within the statutes. Thére is no general or common law power that can be exercised by an administrative agency.
“Rules or regulations of an administrative agency, to be valid, must be within the statutory authority conferred upon the agency. Those rules or regulations that go beyond the authority authorized, which violate the statute, or are inconsistent with the statutory power of the agency have been found void. Administrative rules and regulations to be valid must be appropriate, reasonable and not inconsistent with the law.” Pork Motel, Corp. v. Kansas Dept. of Health & Environment, 234 Kan. 374, 378-79, 673 P.2d 1126 (1983).
“The power of an administrative agency to adopt rules and regulations is administrative in nature, not legislative, and to be valid administrative regulations must be within the authority conferred. An administrative regulation which goes beyond or conflicts with legislative authorization is void.” Amoco Production Co. v. Armold, Director of Taxation, 213 Kan. 636, Syl. ¶ 1, 518 P.2d 453 (1974).
The primary issue in this case then is whether the statutory authority asserted by the agency as the basis for K.A.R. 40-1-20 was broad enough to authorize the regulation.
K.A.R. 40-1-20 indicates it is authorized by K.S.A. 40-103 and K.S.A. 1989 Supp. 60-217(a) and implements K.S.A. 40-216, K.S.A. 40-1110, K.S.A. 40-2201, K.S.A. 1989 Supp. 40-2203, and K.S.A. 40-2204. Whether these statutes provide sufficient authority for K.A.R. 40-1-20 requires interpretation of the statutes indicated.
“The interpretation of a statute is a question of law and it is the function of a court to interpret a statute to give it the effect intended by the legislature.”
“While the administrative interpretation of a statute should be given consideration and weight it does not follow that a court will adhere to the administrative ruling where the statute is clear and the administrative ruling is erroneous. The final construction of a statute rests within the courts.” Amoco Production Co. v. Armold, Director of Taxation, 213 Kan. 636, Syl. ¶¶ 4, 5.
K.S.A. 4Ó-103, the first statute cited, provides:
“The commissioner of insurance shall have general supervision, control and regulation of corporations, companies, associations, societies, exchanges, partnerships, or persons authorized to transact the business of insurance, indemnity or suretyship in this state and shall have the power to make all reasonable rules and regulations necessary to enforce the laws of this state relating thereto.”
The amicus curiae argues that this statute somehow provides such a broad grant of authority as to warrant the regulation in question. The statute expressly provides, however, only the power to make regulations necessary to enforce the laws relating to supervision of insurance, i.e., some other statute must first provide more specific basis for authority before this statute comes into play.
K.S.A. 1989 Supp. 60-217(a), generally speaking, requires that every legal action be prosecuted in the name of the real party in interest. One author indicates this statute “effects a purely procedural change,” leaving the “substantive law as to what claims are assignable” unaffected. 2 Vernon’s Kansas C. Civ. Proc. § GO-217, Author’s Comments (1963). While the statute might require an insurance company to pursue any subrogation rights in its own name, it would not provide authority to bar subrogation clauses in insurance contracts generally.
K.S.A. 40-216 requires insurance companies to file their policies with the Kansas Insurance Department and authorizes that agency to prevent the issuance or delivery of any insurance contract within 30 days of its filing when the agency believes the contract does not comply with the laws of this state. The statute does not, however, provide authority in and of itself to exclude substantive provisions absent some other authority within the statutes of this state.
K.S.A. 40-1110 discusses what supplemental coverages or endorsements may be included in connection with insurance against bodily injury liability. Subrogation is not addressed by this statute, either directly or impliedly.
K.S.A. 40-2201 merely defines the term “policy of accident and sickness insurance.”
Durrett and the Kansas Insurance Department place their primary reliance on the two remaining statutes, K.S.A. 1989 Supp. 40-2203 and K.S.A. 40-2204.
K.S.A. 1989 Supp. 40-2203(A) sets forth thirteen uniform policy provisions which must be included in every policy of accident or sickness insurance issued or delivered in this state. K.S.A. 1989 Supp. 40-2203(B) lists eleven additional provisions which are not required but which, if they are included, must be set forth in the wording of the statute or wording no less favorable to the insured. No section of K.S.A. 1989 Supp. 40-2203 mentions subrogation or acts either to permit or exclude it.
K.S.A. 40-2204(A) provides: “Other policy provisions: No policy provision which is not subject to K.S.A. 40-2203 shall make a policy, or any portion thereof, less favorable in any respect to the insured or the beneficiary than the provisions thereof which are subject to this act.”
A policy provision providing for subrogation is “not subject to K.S.A. 40-2203.” Durrett and the Kansas Insurance Department argue that a subrogation provision, by having the eifect of reducing the benefits ultimately received by a policyholder, would be a less favorable provision, and so prohibited by K.S.A. 40-2204(A). USAA seems to place the same interpretation on K.S.A. 40-2204(A), but argues a subrogation clause makes the policy no less favorable to the insured as it does not diminish coverage but merely acts to prevent recovery of duplicative benefits.
We conclude that a subrogation clause is a provision less favorable to the insured than those provisions delineated in K.S.A. 1989 Supp. 40-2203. Thus, K.S.A. 40-2204, when read in conjunction with K.S.A. 1989 Supp. 40-2203, provides adequate statutory authority for the promulgation of K.A.R. 40-1-20.
The attorney general has issued an opinion to the effect that, while the other statutes cited do not provide a sufficient basis for K.A.R. 40-1-20, K.S.A. 40-2204 does provide the necessary authority. Att’y Gen. Op. No. 84-35. While an opinion issued by the attorney general’s office is not binding on this court, the court may find it persuasive. See Moore v. City of Lawrence, 232 Kan. 353, 362, 654 P.2d 445 (1982).
The interpretation and analysis of the Kansas Insurance Department is also significant. “Ordinarily, the interpretation placed on a statute by the administrative agency charged with its enforcement is entitled to judicial deference and may be of controlling significance.” Board of Johnson County Comm’rs v. Greenhaw, 241 Kan. 119, 122, 734 P.2d 1125 (1987).
Finally, it is significant that the legislature has affirmatively authorized a right of subrogation with regard to PIP benefits, K.S.A. 1989 Supp. 40-3113a, and uninsured motorist benefits, K.S.A. 40-287. This suggests the legislature believed subrogation was not otherwise available in Kansas. The fact that the legislature expressly provided for subrogation in only these two circumstances suggests it intended to preclude subrogation with regard to other types of insurance coverage.
USAA next argues that, even if the statute, was based on sufficient statutory authority, it violates the Kansas Bill of Rights, which provides: “All persons, for injuries suffered in person, reputation or property, shall have remedy by due course of law, and justice administered without delay.” Kan. Const. Bill of Rights, § 18.
Section 18 “does not create rights of action; it only requires that Kansas courts be open and afford a remedy for such wrongs that are recognized by law.” Clements v. United States Fidelity & Guaranty Co., 243 Kan. 124, 128, 753 P.2d 1274 (1988). K.A.R. 40-1-20 does not deny a right implicitly or explicitly guaranteed by the United States Constitution or Section 18 of the Kansas Bill of Rights. The only right that could have been created here was a contract right. Because K.A.R. 40-1-20 forbade such a contract clause, no right ever came into existence. As a result, there was no injury, no wrong recognized by law, and no wrongdoer from whom USAA was denied a remedy. “No person has a vested interest in any rule of law entitling him to insist that it shall remain unchanged for his benefit.” New York Central R. R. Co. v. White, 243 U.S. 188, 198, 61 L. Ed. 667, 37 S. Ct. 247 (1917).
Finally, USAA contends K.A.R. 40-1-20 is void due to vagueness. Its argument seems to be that various types of policies pay medical, surgical, hospital, or funeral benefits, and the regulation’s failure to delineate the types of general policies to which it applies makes it too broad for practical application.
“Administrative regulations are presumptively valid, and one who attacks them has the burden of showing their invalidity.” Smaldone v. United States, 458 F. Supp. 1000, 1003 (D. Kan. 1978). The standard for determining whether a statute is unconstitutionally vague is a common-sense determination of fairness. Gumbhir v. Kansas State Board of Pharmacy, 231 Kan. 507, 518, 646 P.2d 1078 (1982), cert. denied 459 U.S. 1103 (1983). “Can an ordinary person exercising ordinary common sense understand and comply with the statute? If so, it is not unconstitutionally vague.” 231 Kan. at 518. The language of the regulation is clear; the words used are those in common usage or those which have been judicially defined.
USAA correctly notes that in Hall v. State Farm Mut. Auto. Ins. Co., 8 Kan. App. 2d at 481, this court found K.A.R. 40-1-20 invalid to the extent it contravened 40-3113a(b), which allows subrogation 'With regard to PlP benefits (including where medical benefits are provided under PIP coverage). Contrary to the argument of USAA, however, this narrowing in scope does not prove the regulation void for vagueness or for any other reason. It merely illustrates the principle that a regulation cannot contravene a controlling statute and necessitates that the regulation be read in conjunction with the insurance code. See 8 Kan. App. 2d at 481.
K.A.R. 40-1-20 is not constitutionally void for vagueness.
We conclude that K.A.R. 40-1-20 is a validly issued regulation. A validly issued regulation adopted to carry out policy declared by the legislature in the statutes has the force and effect of law. Tew v. Topeka Police & Fire Civ. Serv. Comm’n, 237 Kan. 96, 100, 697 P.2d 1279 (1985). Because the subrogation clause in question applied to coverage providing reimbursement of medical expense, it is within the ambit of the prohibitions of K.A.R. 40-1-20 and is void and of no effect.
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Lorentz, J.:
C.H., the mother of L.S. and A.J.S., appeals the termination of her parental rights and further appeals the trial court’s denial of her motion to reconsider. We reverse and remand for new trial.
C.H. argues that her parental rights should not have been terminated because she was not afforded proper notice and opportunity to be heard. She further argues the trial court erred in denying her motion to reconsider by finding adequate service had been afforded.
The State first argues the natural mother has no standing to appeal the termination of her parental rights because on April 18, 1988, she signed a consent to the adoption of L.S. and A.J.S., which was acknowledged before the administrative district court judge for Wyandotte County. The State argues that such a consent, acknowledged before a judge of a court of record, is irrevocable pursuant to K.S.A. 59-2102(c).
As this court has previously stated, provisions of the adoption statutes must be “strictly construed in favor of maintaining the rights of the natural parents in controversies involving termination of the parent-child relationship.” In re Adoption of J.G., 10 Kan. App. 2d 483, 485, 702 P.2d 1385, rev. denied 238 Kan. 877 (1985). K.S.A. 59-2102(c) establishes rules between the natural parents and prospective adoptive parents on when and under what circumstances a consent to adoption can be revoked. Treiber v. Stong, 5 Kan. App. 2d 392, 396, 617 P.2d 114, rev. denied 228 Kan. 807 (1980). Here, no adoption was ever finalized. The legislature did not intend that a natural parent should lose forever all parental rights to a child if the adoption consented to is not completed. Treiber, 5 Kan. App. 2d at 396. We find nothing in the consent by C.H. to an incompleted adoption which would disturb her standing to assert this appeal.
We now turn to the natural mother s arguments that she was not afforded due process. “[J]urisdiction over the person of the defendant can be acquired only by issuance and service of process in the method prescribed by statute, or by voluntary appearance.” Davila v. Vanderberg, 4 Kan. App. 2d 586, 608 P.2d 1388 (1980). “A parent’s right in and to his or her children is of paramount importance and is entitled to due process protection under the Fourteenth Amendment.” In re M.L.K., 13 Kan. App. 2d 251, Syl. ¶ 1, 768 P.2d 316 (1989).
On January 27, 1989, the district court found that the notice of termination hearing by publication was sufficient. The affidavit of the investigator upon which the court based its authority for publication notice showed the investigator contacted the BPU, the Gas Service Co., Union Gas, Directory Assistance, Wyandotte County Voter Registration, the Wyandotte County Sheriffs Department, and the Kansas City, Kansas, and Kansas City, Missouri, Police Departments in his efforts to locate C.H. No effort was apparently made to contact any relatives of C.H., or any friends or neighbors in the area of her last known address.
K.S.A. 38-1582(c), a section of the code dealing with the procedures for terminating parental rights, states:
“(c) In any case in which a parent of a child cannot be located by the exercise of due diligence, service shall be made upon the child’s nearest blood relative who can be located and upon the person with whom the child resides. Service by publication shall be ordered upon the parent.”
Before there can be a valid personal service of process by publication in a termination of parental rights action upon a parent who cannot be located by due diligence, this statute must be at least substantially complied with. See Briscoe v. Getto, 204 Kan. 254, 256, 462 P.2d 127 (1969). A reasonable attempt was not made to locate or serve the children’s nearest blood relative. If such an attempt had been made, the natural mother might well have been located. We hold this error to be fatal to service in this case. Without such service the State did not have personal jurisdiction over the natural mother. Lack of personal jurisdiction renders the judgment void. Ford v. Willits, 9 Kan. App. 2d 735, 743-44, 688 P.2d 1230 (1984), aff'd 237 Kan. 13, 697 P.2d 834 (1985).
The trial court erred in finding the State had exercised due diligence in attempting to locate the natural mother.
Parents’ rights of custody and control of their children are liberty interests protected by the Fourteenth Amendment Due Process Clause. In re Cooper, 230 Kan. 57, Syl. ¶ 1, 631 P.2d 632 (1981). The due process clause requires at a minimum
“ ‘that deprivation of life, liberty or property by adjudication be preceded by notice and opportunity for hearing appropriate to the nature of the case. . . . [W]hen notice is a person’s due, process which is a mere gesture is not due process. The means employed must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it.’ ” Pierce v. Board of County Commissioners, 200 Kan. 74, 82-83, 434 P.2d 858 (1967) (quoting Mullane v. Central Hanover Tr. Co., 339 U.S. 306, 313, 315, 94 L. Ed. 865, 70 S. Ct. 652 [1950]).
Due process requires that notice must be “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.” Mullane v. Central Hanover B. & T. Co., 339 U.S. 306, 314, 94 L. Ed. 865, 70 S. Ct. 652 (1950). When the addresses of the parties to be served are easily ascertainable, notice of pending proceedings by publication service, alone, is not sufficient to satisfy the requirements of due process. Federal Nat’l Mtg. Ass’n v. Beard, 8 Kan. App. 2d 371, 375, 659 P.2d 232 (1983).
K.S.A. 38-1534(f) mandates that service by publication in proceedings such as these be authorized only after the filing of an affidavit alleging the affiant has made a reasonable effort to ascertain the residence of the parties named. K.S.A. 38-1582(b) requires the trial court to determine due diligence was used in locating interested parties. If the State did not act with due diligence to locate the absent natural mother, then service was improper. See In re Woodard, 231 Kan. 544, 554-55, 646 P.2d 1105 (1982).
The trial court concluded there was due diligence in the State’s effort to locate the natural mother. The trial court’s findings of fact, if supported by substantial competent evidence, are conclusive on appeal, but the trial court’s conclusions of law arising from these facts are subject to unlimited review on appeal. See Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988); In re Clark, 76 N.C. App. 83, 86-87, 332 S.E.2d 196 (1985).
It is not necessary to follow a restrictively mandatory checklist for measuring due diligence. What is necessary to a reasonable inquiry will vary from case to case. Due diligence does not require the use of all conceivable means possible to an inquiry into the absent parent’s whereabouts. In the context of proceedings to terminate parental rights, the Nebraska Supreme Court has stated what constitutes a reasonably diligent search for the purpose of justifying service by publication. It held it
“[i]s such an inquiry as a reasonably prudent person would make in view of the circumstances and must extend to those places where information is likely to be obtained and to those persons who, in the ordinary course of events, would be likely to receive news of or from the absent person.” In the Interest of A.W., 224 Neb. 764, 766, 401 N.W.2d 477 (1987).
Where, as in this case, the State failed to attempt to seek out and contact either relatives or friends and neighbors at the absent mother’s last known address in order to inquire as to her current whereabouts, we do not believe due diligence was exercised. In the absence of due diligence, due process is denied and any judgment rendered is void. Sweetser v. Sweetser, 7 Kan. App. 2d 463, 465, 643 P.2d 1150 (1982).
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The opinion of the court was delivered by
Kaul, J.:
This is an action in mandamus instituted by the appellants, three fire fighters, who were formerly employees of the City of Salina. The petition consists of three counts. In count one appellant Gray alleged that defendants, City of Salina and city manager, Norris Olson, discharged him and required him to seek early retirement on or about October 16, 1970, all because of his membership and activity in Local No. 782, International Association of Fire Fighters, AFL-CIO, hereafter referred to as the union. Gray alleged that his discharge on these grounds was in violation of Article 15, Section 12, of the Kansas Constitution, commonly known as the right-to-work amendment. Gray prayed for an order of mandamus requiring defendants to reinstate him to his former position in the Salina Fire Department with all back pay due since the date of his discharge and for other incidental relief.
In counts two and three of the petition, appellants Armstrong and Martin, respectively alleged that they each had been discharged in January 1971, all because of membership and activity in the union. Armstrong and Martin prayed for relief in the same form as that sought by Gray.
Defendants answered generally denying violation of the right-to-work amendment. With the issues thus joined the case came on for trial.
At the close of plaintiffs’ case, defendants moved for dismissal upon the grounds that plaintiffs’ evidence wholly failed to prove any alleged ground for relief. The trial court sustained defendants’ motion. The proceedings are not reproduced in the record, however, the journal entry reflects the following:
“Now on this 9th day of June, 1971, parties appearing as before, the court finds that defendants’ motion to dismiss should be sustained for the reason and upon the grounds that the plaintiffs’ evidence fails to prove that plaintiffs, or any of them, were discharged from former positions in the Fire Department of the City of Salina in violation of the Kansas Right-to-Work Amendment, Kansas Constitution, Article XV, § 12, and that plaintiffs should be assessed with the costs of this action.”
Thereupon plaintiffs perfected this appeal asserting the trial court erred on several grounds in its disposition of the case.
Evidence adduced by plaintiffs at the trial consisted of the testimony of the fire chief, several officers and members of the fire department, the chief of police, and various other city officials.
Appellant Gray was given the choice of retirement or dismissal on October 16, 1970. He elected to retire and has been receiving retirement benefits since that date. City officials and the fire chief testified that Gray was given the choice of retirement or dismissal because of his incompatibility with the fire department; his inability to get along with his superiors or with his men; and the poor morale on his shift.
Appellant Martin, a lieutenant with the fire department, was discharged on January 20, 1971. In October 1970 he told fire chief Lacy about some talk around his station of possible sabotage of city owned equipment. Chief Lacy testified that he gave little thought to the matter until January 18, 1971, when the tires on a city owned automobile driven by John J. Woody, chief of police, were slashed. The following morning Lacy asked Martin to tell the police the names of those who had earlier threatened or talked about sabotaging the property. Martin refused to give the names. He was promptly discharged as of January 20,1971, for insubordination in refusing to cooperate with city officials in the sabotage investigation.
Appellant Armstrong, the purported president of the fire fighters union, was discharged on January 13, 1971. He had been suspended in 1970 for a brief period for poor attitude toward his job and for disregarding established departmental procedure. The reasons given for his discharge were failure to follow “chain of command,” insubordination, a “demanding” approach to his superiors, and particularly because of a letter written by him described as threatening “Action.”
Neither Armstrong nor Gray testified at the trial. Martin’s only testimony was to deny knowledge of the names of those threatening sabotage to city vehicles.
Chief Lacy testified that he assumed Martin was a union member and that he knew Gray had been a union member, but did not know Gray’s status in this respect at the time of his forced retirement. There is no direct evidence in the record showing that Gray or Martin were union members. The record is entirely void of any evidence that Gray engaged in any union activities which might have been the actual basis for his dismissal. Concerning Martin there is only a vague reference to some involvement he may have had nearly a year prior to his discharge in connection with the hiring of an attorney by the union. There is no direct evidence in the record that the basis for Martin’s dismissal was anything other than his refusal to cooperate in the police investigation.
On appeal appellants specify thirteen points of error. However, many of them cannot be reviewed by this court because of the inadequacy of the record relating thereto.
Appellants’ first contention is error by the trial court in refusing to allow them to amend their petition to conform to proof under K. S. A. 1972 Supp. 60-215. Presumably, appellants’ motion was lodged at the conclusion of the evidence. However, the record does not disclose the motion, the objections of the appellees or the rulings of the trial court in the disposition thereof. The record being silent as to any such proceedings appellate review is impossible. This court has stated many times that it is incumbent upon the party appealing to bring up a complete record of all matters upon which review is sought. (Curby v. Ulysses Irrigation Pipe Co., Inc., 204 Kan. 456, 464 P. 2d 245; and Robles v. Central Surety & Insurance Corporation, 188 Kan. 506, 363 P. 2d 427.)
In passing, we observe in this connection that appellants alleged in their petition as a sole ground for relief that their dismissals were in violation of the right-to-work amendment (Article 15, Section 12, of the Kansas Constitution), and they presented their case to the trial court on that basis. Any issue pertaining to the question whether appellants’ dismissal must have been for good cause was not injected until their motion to amend was made. The matter of permitting or refusing an amendment to the pleadings at this juncture of the litigation was wholly within the trial court’s discretion and in the absence of a clear abuse thereof the order of the trial court will not be disturbed. (Hoover Equipment Co. v. Smith, 198 Kan. 127, 422 P. 2d 914; and Finn, Administratrix v. Veatch, 195 Kan. 13, 403 P. 2d 189.)
Appellants’ points two, three and four concern the trial court’s rulings in excluding or admitting certain evidence. The record fails to disclose the circumstances surrounding the objections lodged by appellants. Since the essential portions of the trial transcript were not designated and included in the record, we are unable to review the matters complained of on appeal.
Points five and six concern appellants’ claim that their evidence established as a matter of law and fact that they had been dismissed or forced into retirement without just cause. The points raised here are eliminated by reason of our disposition of appellants’ first point. As we have previously indicated, the appellants’ presentation of their case was on the issue that they had been discharged in violation of the right-to-worlc amendment as pleaded in their petition. They are not entitled to expand the case to include an entirely new issue of discharge or forced retirement without just cause. This question was not determined by the trial court and is not before us on appellate review.
In points seven and eight appellants raise the critical issues to be considered in this appeal. They claim that their evidence established as a matter of law and fact that they were discharged or forced into retirement because of their union membership and/or union activities in violation of the right-to-worlc amendment; and further that the trial court erred as a matter of law in holding that they had not proved their entitlement to writs [orders] of mandamus requiring each of them to be restored to their former employment.
The right-to-work amendment, Article 15, Section 12, of the Kansas Constitution, reads:
“No person shall be denied the opportunity to obtain or retain employment because of membership or nonmembership in any labor organization, nor shall the state or any subdivision thereof, or any individual, corporation, or any kind of association enter into any agreement, written or oral, which excludes any person from employment or continuation of employment because of membership or nonmembership in any labor organization.”
Appellees concede that the power or authority of a city manager in the matter of dismissing a subordinate city employee is now limited by the provisions of the right-to-work amendment. Appellees contend, however, that appellants failed to sustain the burden of showing that they were discharged either by reason of union membership or union activities. Therefore, appellees further claim it is unnecessary in this case to determine whether the amendment proscribes dismissal for union activities as well as for union membership since the evidence failed to support appellants’ position on either premise. We are inclined to agree with appellees.
The record suggests considerable conflict between the fire fighters and the city administration over a period of several years. Although the dismissals were actually made by city manager Olson, his brief testimony — as reproduced in the record — is not addressed to the reasons for the discharges of appellants. There was some evidence which hints at antiunion animus on the part of some of the top-level city officials. However, the evidence disclosed that the union had been in existence for some twenty-five years and that most of the fire department administrators had previously been union members. There is no direct evidence of appellant Gray’s union membership and no evidence whatsoever as to union activity on his part. A memo prepared by chief Lacy at the time of Gray’s dismissal was received in evidence, it included these statements: “Gray said I haven’t been going to Union meetings. I said I don’t care about Union Meetings.” The reasons given for Gray’s forced retirement were not refuted by him.
The evidence of union membership and activity on the part of appellant Martin was scanty and any conclusion to that effect would necessarily have to be made by inference. The stated reason for Martin’s dismissal was because of what his superiors determined to be a refusal to cooperate in any investigation of vandalism of city vehicles. There is actually no evidence that he was dismissed for any other reason.
The trial court’s dismissal of the action as to Gray and Martin is supported by the evidence and must be upheld.
The trial court’s ruling with respect to appellant Armstrong must be examined in a somewhat different frame of reference. The evidence clearly reflects that he was president of the union and there was testimony concerning several complaints about letters he wrote as union president urging action with regard to vacations and time schedules. On February 24, 1970, Armstrong was suspended for reasons stated as poor attitude and disregard of established administrative policies. While he was suspended, Armstrong appeared before the city commission. The upshot of that confrontation was that tire city director of safety urged Armstrong’s immediate dismissal for insubordination; however, this recommendation was not acted upon. In the fall of 1970 the city commission commenced a three-month investigation of the fire department and interviewed every administrator and fire fighter in the department. On January 6, 1971, Armstrong wrote a letter to chief Lacy on union stationery with his signature appearing as president of the union. Throughout the testimony this letter is described and referred to as the “Action” letter. In the letter Armstrong informed the chief that the executive board of the union had been directed by the membership to meet with the chief prior to January 11, 1971. These further statements were contained in the letter:
“We wish to discuss your action toward certain union members, as to the merit raises, intimidations, and firing. Two other items for action are vacations, and the western show.
“The membership of local 782 wants yon. to know that if you are not willing to meet, and take action, ACTION will he taken.”
Chief Lacy passed Armstrong’s letter on to the city commissioners who called Armstrong in for a conference. At the conference Armstrong was questioned by the commissioners as to whether he wrote the letter in his representative capacity as president of the union or as an individual. Commissioner Ashton testified that Armstrong was asked how many members voted on the letter but that Armstrong refused to answer. Ashton testified that the commission, after examining the letter and further interviewing Armstrong, concluded that the letter was nothing more than harassment on the part of Armstrong, individually, to upset the commissioners’ findings. The findings referred to were those made after an evaluation of the three-month investigation. Ashton testified the “Action” letter was the thing that influenced him to sign the recommendation for Armstrong’s dismissal but that the recommendation of dismissal by the city commission was in no way influenced by Armstrong’s union membership or any activity on his part in connection therewith.
Mayor Caldwell agreed with Ashton’s version of the commission meeting with Armstrong. The mayor testified that the city commission was not antiunion.
As we have previously noted, Armstrong did not testify. Thus, there is no evidence in the record, other than what can be inferred from the “Action” letter itself, that Armstrong was acting in a representative capacity. Armstrong did not choose to controvert the statements of Ashton and Caldwell, that their conclusions after the interview were that Armstrong wrote the letter on his own, rather than in a representative capacity for the union. Failure of a party to an action to throw light upon an issue peculiarly within his own knowledge or reach, raises a presumption that the concealed information is unfavorable to him. The presumption, of course, is open to explanation. (Londerholm v. Unified School District, 199 Kan. 312, 430 P. 2d 188; Blackburn v. Colvin, 191 Kan. 239, 380 P. 2d 432; In re Estate of Grisell, 176 Kan. 209, 270 P. 2d 285; and Donley v. Amerada Petroleum Corp., 152 Kan. 518, 106 P. 2d 652.)
The controlling question in this appeal — whether appellants’ dismissals were in violation of the right-to-work amendment — is essentially one of fact. The case was tried to the court without a jury, thus the corut’s consideration of appellees’ motion to dismiss was governed by the provisions of K. S. A. 1972 Supp. 60-241 (b) pertaining to involuntary dismissal. Unlike the parallel situation of a motion for directed verdict in a jury trial under K. S. A. 60-250 (a) the trial court, in considering a motion for involuntary dismissal under 60-241 (b) may weigh and evaluate the evidence in the same manner as if it were adjudicating the case on the merits. (Burks v. Whalen, 208 Kan. 222, 491 P. 2d 940; In re Estate of Ewers, 206 Kan. 623, 481 P. 2d 970; Wiley v. Board of Education, 205 Kan. 585, 470 P. 2d 792; Waterstradt v. Board of Commissioners, 203 Kan. 317, 454 P. 2d 445; and Mackey-Woodard, Inc. v. Citizens State Bank, 197 Kan. 536, 419 P. 2d 847.)
The application of the above rule, for all practical purposes, disposes of appellants’ chief contention on appeal. Even though, as appellants claim, there was some evidence which might support their theories; the trial court had the authority and duty to weigh and evaluate the evidence. Since there is substantial competent evidence to support the trial court’s findings they cannot be disturbed on appeal. To weigh the evidence in the light of any conflict or inconsistency is beyond our scope of review, which is simply to ascertain whether the trial court’s findings are supported by substantial competent evidence; and in making this determination we are required to consider the evidence in the light most favorable to ihe party who prevailed in the court below. (Burks v. Whalen, supra; Wiley v. Board of Education, supra; and Riedel v. Gage Plumbing & Heating Co., 202 Kan. 538, 449 P. 2d 521.)
In view of what has been said, it obviously follows that appellants were not entitled to orders in mandamus. The remedy of mandamus is available only to compel the performance of a clearly defined duty. Its purpose is to require one to whom the order is issued to perform some act which the law specifically enjoins as a duty resulting from his office, trust or position; the remedy may not be invoked to control discretion nor does it lie to enforce a right which is in substantial dispute. Resort to the remedy may be had only when the party invoking it is clearly entitled to the order which he seeks. (Lauber v. Firemen’s Relief Assn. of Salina, 195 Kan. 126, 402 P. 2d 817; and Gray v. Jenkins, 183 Kan. 251, 326 P. 2d 319.)
Appellants contend the appellees waived their right to a motion for involuntary dismissal under 60-241 (b) by interrogating commissioner Ashton as their witness during appellants’ presentation of their evidence. Appellants cite no authority in support of their position and we know of none. K. S. A. 1972 Supp. 60-241 (b) simply authorizes a motion by a defendant for involuntary dismissal “after the plaintiff, . . . had completed the presentation of his evidence,” without waiving his right to offer evidence in the event the motion is not granted.
As their tenth specification of error appellants claim the trial court erred in failing to hold that “union activities” of employees were protected by the right-to-work amendment. This point has been adequately covered in our consideration of points seven and eight, wherein it was pointed out that the record is silent as to any involvement in “union activities,” on the part of Gray and Martin. The trial court’s ruling with respect to the question whether Armstrong was acting in a representative capacity cannot be disturbed for the reasons previously stated.
The evidence in this case discloses that the union had existed in the fire department for more than twenty years. Many of the fire department administrative officials were former members of the union. There is no direct evidence that either fire department administrators or other city officials are — or have been — antiunion.
Other points raised by appellants concern rulings of the trial court on evidence. We have carefully examined the contentions presented and find them to be without merit.
The judgment is affirmed. | [
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The opinion of the court was delivered by
Schroeder, J.:
This is an appeal in a workmen's compensation case by the widow as conservator of the estate of Christopher Zeitner, the minor dependent of the deceased workman.
The issue on appeal is whether the trial court properly computed the wages of the deceased workman pursuant to K. S. A. 44-511(2). Under the trial court’s computation the decedent’s minor dependent was awarded the minimum death benefit.
In the proceedings before the examiner the surviving spouse of the decedent, Hanne Zeitner, waived her rights to compensation in favor of the minor son of the parties, Christopher Zeitner. The district court entered an award of $2,500 in favor of Hanne Zeitner as conservator of the estate of Christopher Zeitner, and appeal has been duly perfected.
Peter O. A. Zeitner, the deceased workman, was employed by Floair, Inc., (respondent-appellee) to pilot an airplane from Wichita, Kansas, to Bogota, Colombia. This particular flight was the first decedent had performed for the company. The flight commenced on August 14, 1968, and on the same day while piloting the aircraft the decedent was killed when the plane was involved in a mid-air collision near Cleburne, Texas. The personal injuries resulted in the decedent’s immediate death. At the time of his death, the decedent left his widow, Hanne Zeitner, and a two year old minor son, Christopher Zeitner. Prior to the accident the decedent had been a graduate student and part-time lecturer in Spanish at Wichita State University.
Merle L. Patterson, vice-president of Floair, Inc., testified the decedent came to his place of business on April 5, 1968, and made application for employment. He stated the appellee had two classes of pilots, those who were available to fly trips seven days a week, twenty-four hours a day, who were called full-time pilots, and other pilots who had other jobs. These pilots were categorized as part-time pilots. At the time the deceased made application, the appellee had fifteen full-time pilots who were given priority to malee trips. Appellee also had approximately forty-five part-time pilots. The decedent was classified as a part-time pilot due to his work at Wichita State University. All pilots were paid at the same rate.
Another witness, Dr. Eugene Savaiano, testified that until August, 1968, the decedent had been a graduate student and lecturer at the University. Lecturers were teachers who are hired in emergency situations when there are not available instructors, teachers or professors. The decedent was scheduled to continue his duties as a lecturer in September, 1968, if there was an enrollment. The decedent was not called by the appellee to perform any services until August 14, 1968, when he was hired to pilot an airplane from Wichita, Kansas, to Bogota, Colombia. For this work he was to received $195 which was computed by paying him seven cents per nautical mile flown. The contemplated distance was 2,746 nautical miles. The normal flying time for this trip was five days.
The decedent had completed fifteen to twenty per cent of the total distance of the trip at the time of the accident.
It was stipulated before the Workmen’s Compensation Examiner that the fatal accident arose out of and in the course of the decedent’s employment. The only issue remaining to be determined was the amount of compensation to be paid. The examiner found the minor son of the decedent, Christopher Zeitner, was totally dependent upon the decedent for support. In determining the decedent’s wages the examiner found the average weekly wage was $10 per week and awarded the statutory minimum death benefit of $2,500 pursuant to K. S. A. 1969 Supp. 44-510b(a). It was from the examiner’s computation of wages that appeal was taken to the district court.
The appellant contends the trial court erred in finding the provisions of K. S. A. 44-511(2) were not applicable to the facts in this case.
Under K. S. A. 1971 Supp. 44-556, the Supreme Court on appeal in a Workmen’s Compensation Case is limited to determining questions of law (Morgan v. Auto Transports, Inc., 192 Kan. 139, 141, 386 P. 2d 230.)
We are again called upon to construe K. S. A. 44-511 which provides in pertinent part:
"(1) Whenever in this act the term wages’ is used it shall be construed to mean the money rate at which the service rendered is recompensed under the contract of hiring in force at the time of the accident. . . .
“(2) Where prior to accident the rate of wages is fixed by the output of the employee the daily wage shall be calculated by dividing the number of days the workman was actually employed into the total amount the employee earned during the preceding six (6) months, or so much thereof as shall refer to employment by the same employer. Where the rate of wages is fixed by the hour the daily wage shall be found by multiplying the hourly rate by the customary number of working hours constituting an ordinary day in the character of work involved. In any case the weekly wage shall be found by multiplying the daily wage by five (5). . . . Five (5) days shall constitute a minimum week.
“(3) In any case, the average yearly wage shall be found by multiplying the weekly wage, determined as hereinbefore provided by fifty-two (52).” (Emphasis added.)
Under the statute the amount of compensation to be paid is to be determined by the contract of hiring in force at the time of the accident. At the time of the accident, the decedent was hired under a contract to ferry a plane from Wichita, Kansas, to Bogota, Colmbia, a distance of approximately 2,746 nautical miles. In return the decedent was to receive seven cents per nautical mile flown. The anticipated length of employment was five days.
The language of 44-511(2), supra, speaks of two types of wage rates, one fixed by the output of the employee and the other fixed by the hour.
Since the decedent’s wage rate was set at seven cents per nautical mile flown, his wages were fixed “by the output of the employee.”
Under these circumstances the statute provides the employee’s daily wage shall be calculated by dividing the number of days the workman was actually employed into the total amount which he had earned in the preceding six months, or so much thereof as shall refer to employment by the same employer.
The trial court found the decedent was employed by the appellee as of April 5, 1968, when he made application for employment to respondent. Using this date as the beginning of employment, the average weekly wage computed in accordance with the rules above set forth in 44-511, supra, is a mere pittance. The resultant calculation establishes the average yearly wage so small that the claimant is awarded only the minimum death benefit of $2,500. (K. S. A. 1969 Supp. 44-510b [a].)
The appellant contends the trial court’s finding that the decedent commenced employment on April 5, 1968, the day he made application for work, is erroneous. The appellant asserts the decedent was actually employed on August 14, 1968, the day he first performed work for the respondent.
Under the appellant’s theory, the decedent’s total pay for the trip had been computed at $195 based on seven cents per nautical mile. Since the anticipated length of employment was five days, the daily wage is determined by dividing five into $195, which results in a daily wage of $39. By using the statutory formula, one into $39 equals $39 per day, which would be the daily wage.
The weekly wage is found by multiplying $39 by five. This gives $195 as a weekly wage. Continuing to follow the statute, the average yearly wage is to be found by multiplying the weekly wage of $195 by 52, which equals $10,140. Using this theory the resulting figure authorizes the claimant to recover an award of the maximum death benefit of $16,500. (K. S. A. 1969 Supp. 44-510b [a].)
The decisive question is when did the decedent become an employee within the meaning of K. S. A. 44-511(2)?
The precise language of the statute (44-511[2], supra) commanding our attention on this point reads:
“. . . The daily wage shall be calculated by dividing the number of days the workman was actually employed into the total amount the employee earned during the preceding six (6) months. . . .” (Emphasis added.)
We find no Kansas cases, and our attention has been directed to none, construing the meaning of “actually employed,” as used in the statute.
The respondent relies on Armstrong v. Manpower, Inc., 194 Kan. 753, 401 P. 2d 903, and Casebeer v. Casebeer, 199 Kan. 806, 433 P. 2d 399, in support of its argument that the statutory formula is not applicable herein. These cases are distinguishable and have no direct bearing on the question here presented because the workman in each of these cases was paid wages on an hourly basis.
The State of New Jersey has a statute worded almost identically to ours and their Supreme Court has been called upon to determine the meaning of “actually employed.” The New Jersey statute, N. J. S. A. 34:15-37, reads:
“. . . Where prior to the accident, the rate of wages is fixed by the output of the employee, the daily wage shall be calculated by dividing the number of days the workman was actually employed into the total amount the employee earned during the preceding six months, or so much thereof as shall refer to employment by the same employer.”
In Davidson v. Nathanson Furniture Stores, Inc., 126 N. J. L. 430, 20 A. 2nd 61, the workman was a salesman and was employed on October 16, 1939. He did not go to work at that time, but did report for work a week later. In connection with the above statute the court held it was not the day of hiring that controls, but the days on which the workman was actually employed. (See also, Highway Freight Co. v. Workmen's, &c., Bureau, 125 N. J. L. 168, 15 A. 2nd 272, 274, affirmed in Highway Freight Co. v. Department of Labor, 126 N. J. L. 367, 19 A. 2d 459.)
Rules adopted by the Director of Workmen’s Compensation also have a bearing on the point under consideration. Under Volume 2, Kansas Administrative Regulations, Computation of Wages, 51-11-1, published and filed with The Revisor of Statutes in conformity with K.S.A. 77-416 and K.S.A. 1971 Supp. 44-573, the following is stated:
“. . . The wages of a part-time employee, for the purpose of computing the compensation payment, are to be computed the same as that of a full-time employee in the same or similar work. . . .”
It is readily apparent the classification of the deceased workman by the respondent as a part-time pilot is immaterial under the foregoing rule.
Under Volume 2, Kansas Administrative Regulations, Wholly Dependent Persons, 51-10-2 the following example is given:
“For example: Assume that the workman had worked but one hour for an employer when he met with accidental death arising out of and in the course of his employment; that the hourly rate of pay was $3.00; that the customary number of working hours constituting an ordinary day in the character of work involved was eight; that the customary number of working days constituting an ordinary week in the character of work involved was five; that workman’s average weekly wage will be $3.00 X 8 X 5, or $120. Overtime is to be computed when involved.”
In construing the statute here in question we think it immaterial that the decedent, when he made application for employment with the respondent, requested only flights to South America because he wanted to further his linguistic experience as a Spanish instructor. The evidence disclosed he would have an opportunity for, at most, only three flights to South America in one year. The respondent relies on this evidence and cites State Road Com. v. Ind. Com., 56 Utah 252, 190 Pac. 544 (1920) for the proposition that no person can possibly have an earning capacity in a particular employment greater than the opportunities afforded by that employment.
What the legislative intent was determined to be in other states on workmen’s compensation statutes dissimilar to our own is not of great significance in construing the language of the statute presently under consideration.
We think “actually employed” as used in 44-511(2) means the time the workman was actually employed and on the job, and it is not the day of hiring that controls. We think the Davidson decision in New Jersey persuasive on this point.
When so construed, the decedent was “actually employed” only one day within the meaning of 44-511(2), supra, when he met with an accident which caused his death.
For the reasons heretofore stated we hold the trial court erred as a matter of law in construing 44-511(2), supra, and in finding the deceased workman was an employee of the respondent 18.71 weeks. The language used by the legislature in 44-511(2), supra, literally applies to the factual situation here presented.
When it is found that the deceased workman was employed only one day at the time of his fatal accident, for which he was to be recompensed $39 under the contract of hiring in force at the time of the accident, it follows that his weekly wage was $195, and the average yearly wage was $10,140 within the meaning of 44-511, supra. When the formula set forth in K. S. A. 1969 Supp. 44-5l0b (a) is applied, the death benefit is limited to $16,500, which was tihe statutory maximum at the time this litigation arose.
The judgment of the lower court is reversed with directions to enter judgment for the appellant for compensation due the minor dependent in accordance with the views expressed in this opinion. | [
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The opinion of the court was delivered by
Fatzer, C. J.:
The appellant, The St. Francis Mercantile Equity Exchange, Inc., brought suit as promisee to collect on an unsecured promissory note executed by the appellee, Glenn Walter, on February 4, 1965. The appellee filed a cross-petition alleging he was the owner of certain shares of stock and “deferred patronage dividends” in the Exchange. He sought to have the value of those assets setoff as a credit against the principal and interest on the note, or in the alternative, judgment against the appellant for that value.
The appellant filed a motion for summary judgment, and it was sustained on December 14, 1970. Execution was reserved by the district court upon final determination on the merits of the appellee’s cross-petition. The record shows the district court entered judgment against the appellant for the value of the stock and the deferred patronage dividends on February 2, 1971. There were no post trial motions.
Thereafter, and on July 12, 1971, the appellant filed a notice of appeal seeking review of the judgment entered on February 2, 1971 — some five months after that determination.
This court has only such appellate jurisdiction as is conferred by statute pursuant to Article 3, Section 3 of the Kansas Constitution (since amended), and when the record discloses lack of jurisdiction, this court has the duty to dismiss the appeal. (Hotchkiss v. White, 191 Kan. 534, 382 P. 2d 325; Materi v. Spurrier, 192 Kan. 291, 387 P. 2d 221; Bammes v. Viking Manufacturing Co., 192 Kan. 616, 389 P. 2d 828; Lira v. Billings, 196 Kan. 726, 414 P. 2d 13; Thompson v. Amis, 208 Kan. 658, 493 P. 2d 1259.) K. S. A. 60-2103 (a) provides the procedure whereby a case may be appealed to this court, and states:
“When an appeal is permitted by law from a district to the supreme court, the time within which an appeal may be taken shall be thirty (SO) days from the entry of the judgment . . .” (Emphasis supplied.)
As indicated, no post trial motions were filed by the appellant to reverse or modify the judgment entered on February 2, 1971. The notice of appeal was filed some four months after the 30 day statute of limitations had run and this court is of the opinion it lacks jurisdiction to consider the merits of the issues raised on appeal.
The appeal is dismissed. | [
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The opinion of the court was delivered by
Schroeder, J.:
This is a damage action wherein Alexander W. Klaus (plaintiff-appellee) sustained injuries while playing football during the noon hour on October 28, 1966, in the senior parking lot at St. Joseph’s Military Academy in Hays, Kansas, when he was struck by an automobile, driven by Francis Goetz (defendant-appellant). The plaintiff’ recovered a verdict of $8,000 and the defendant has duly perfected an appeal.
Various trial errors are asserted on appeal for reversal of the judgment.
There was testimony that Goetz drove into the parking lot at approximately 12:30 P„ M. when he returned to the academy, and in doing so drove into the football game and attempted to use his auto to block the play. Goetz, a senior, was told to leave and did so, going to the; west end of the parking lot. The football players assumed he would park his car. Parking for senior students was available only on the south side of the parldng lot, the north side being reserved, for the faculty.
Testimony indicated the parking lot was not full and ample parking space was: available.
Goetz did not park, however, but revved up his automobile’s engine and then drove back toward the east along and very close to the faculty packing on the north side of the lot.
There was evidence that the speed of the Goetz automobile was 20-25 m. p. h. emd that it was traveling in such a manner that it would have been in the wrong lane of traffic leaving the parking lot.
Goetz testified he saw Klaus only as a darting object out of the corner of his. eye. Although Goetz applied the brakes leaving 45 feet of ski.d marks, his vehicle struck Klaus throwing him 30-35 feet in the air.
Goetz stated he could not turn his automobile to avoid the accident because he would have endangered the other football players.
Klaus was running to catch a pass and was looking back toward the play when the Goetz auto struck him.
Klaus .suffered extensive head injuries from the collision and was hospitalized for several weeks. The jury impaneled to hear the case found in favor of Klaus and awarded a verdict of $8,000.
The appellant contends the trial court erred in failing to grant his motions for a directed verdict, dismissal and a new trial because the findings of the jury and the rulings of the court were not supported by the evidence, and for the further reason that the evidence shows the appellee to have been contributorily negligent and the appellant to have been free from negligence.
The appellant asserts the appellee was contributorily negligent in playing football in an area frequently traveled and crossed by motor vehicles; in looking back over bis shoulder in a direction opposite to that in which he was traveling and in failing to keep a proper lookout.
The jury was asked to return a special verdict. The questions and the jury’s answers were as follows:
“1. Do you find from a preponderance of evidence that at the time and place of the collision, the defendant Francis L. Goetz was negligent in a manner alleged in plaintiff’s petition, which was a proximate cause of the collision?
“Answer: Yes
“(yes or no)
“2. If you answer the foregoing question ‘yes,’ then state the act or acts of Francis L. Goetz that constituted such negligence.
“Answer: The driver did not keep his vehicle under such control that enabled him to regulate his speed to his ability to stop or turn aside.
“3. Do you find from a preponderance of evidence that at the time and place of the collision, the plaintiff Alexander W. Klaus w.as negligent in a manner alleged in the defendant’s answer, which was a proximate cause of the collision?
“Answer: No
“(yes or no)
“4. If you answer the foregoing question ‘yes,’ then state the act or acts of Alexander W. Klaus that constituted such negligence.
“Answer: No
“5. If you answer question No. 1 yes’ and question No. .3 ‘no,’ then please state the amount of damages you find for plaintiff by following instruction No. 21.
“$8,000.”
On appellate review the verdict of a jury will not be disturbed if based upon any substantial competent evidence. (Vannaman v. Caldwell, 207 Kan. 467, 485 P. 2d 1373.)
A review of the record shows substantial competent evidence to sustain the findings of the jury. The appellant did not see the appellee until it was too late, although he was admittedly aware of the football players. Testimony showed he was revving his motor and driving at a rate of 20-25 m. p. h. By his own admission the appellant could not turn his vehicle aside without hitting other football players who were scattered all over the parking lot.
As for the appellee’s alleged contributory negligence, this court has often repeated the rule that, “Contributory negligence is generally a question of fact to be determined by the jury under the circumstances of each particular case and it is not a question of law to be determined by the court.” (Daugharthy v. Bennett, 207 Kan. 728, 732, 486 P. 2d 845, and cases cited therein.)
The jury specifically found no contributory negligence on the part of the appellee. Such a negative finding against the appellant who had the burden of proof implies that he did not sustain that burden. (Vannaman v. Caldwell, supra, Syl. 2.)
On the record presented we cannot say the appellee was guilty of contributory negligence as a matter of law.
The appellant contends the trial court erred in giving instructions Nos. 14, 16 and 17, and in refusing to give the appellant’s requested instructions. The instructions challenged by the appellant read:
“No. 14
“It is undisputed that the place where this collision occurred was on private property and not on a public highway or street. Only such traffic laws of Kansas as are specifically applicable off the public highways are applicable at the place of collision. The owner of the real propery where the collision occurred had the right to regulate the use and set up the conditions for the use of the property by persons permitted on the premises. Such owner also had the duty to inform persons permitted on the premises of such regulations and conditions. No person permitted on the premises had the right to assume that others on the premises would abide by or had knowledege of any such regulations and conditions set up by the owner of the premises.
“No. 16
“A pedestrian is any person afoot.
“There is no provision in the statutory laws of Kansas governing the conduct of a pedestrian at the time and place of the collision.
“No. 17
“The statutory laws of Kansas applicable at the place and time of the collision provide:
“(a) That no person shall drive a vehicle at a speed greater than is reasonable and prudent under the conditions then existing. In every event speed shall be so controlled as may be necessary to avoid colliding with any person, vehicle, or other conveyance in compliance with legal requirements and the duty of all persons to use due care.
“(b) In addition the law provides that the driver of every vehicle shall drive at an appropriate reduced speed when special hazard exists with respect to pedestrians or other traffic.”
Instruction No. 14 was proper and necessary. The appellant contended the St. Joseph’s Military Academy handbook, The Baton, permitted students to play ball only in assigned areas.
Unless this court adopts the proposition that private regulations of a landowner are presumed to be known to the public, to the same extent as public statutes, the instruction was necessary to clearly state the law to the jury. There is no evidence in the record to show the appellee actually knew he was not to play football in the parking lot.
The violation of a private regulation does not constitute negligence per se. Instruction No. 14 does not affect the common law duties of the appellant or the appellee with respect to negligence under the circumstances of this case.
If the instructions to the jury properly and fairly state the law as applied to the facts in the case when considered as a whole, and if the jury could not reasonably be misled by them, the instructions should be approved on appeal. (Langley v. Byron Stout Pontiac, Inc., 208 Kan. 199, Syl. 5, 491 P. 2d 891.) The court’s instructions Nos. 12 and 19 fairly and adequately apprised the jury of the common law duties of a pedestrian in the appellee’s position.
Instructions Nos. 16 and 17 were proper and fairly state the law of Kansas. K. S. A. 8-502 states,
“The provisions of this act relating to the operation of vehicles refer exclusively to the operation of vehicles upon highways except: 1. Where a different place is specifically referred to in a given section. 2. The provisions of sections 18 to 32 [8-518 to 8-532], inclusive, shall apply upon highways and elsewhere throughout the state.”
Apparently ignoring 8-502, supra, the appellant contends K. S. A. 8-555 and K. S. A. 8-556 (c) govern the conduct of pedestrians at all places, that is not only on public highways but on private lots as well. K. S. A. 8-555, in effect at the time this litigation arose, provides:
“Pedestrians shall be subject to traffic-control signals at intersections as heretofore declared in this act, but at all other places pedestrians shall be accorded the privileges and shall be subject to the restrictions stated in this article.”
K. S. A. 8-556 (c) in effect at the time this litigation arose provides:
“No pedestrian shall suddenly leave a curb or other place of safety and walk or run into the path of a vehicle which is so close that it is impossible for the driver to yield.”
The appellant argues the words “or other place of safety” in 8-556 (c), supra, and the words “at all other places” in 8-555, supra, indicate that the scope of the two statutes governing the conduct of pedestrians extends to all places where pedestrians and automobiles are lilcely to meet.
The appellant’s theory is not well taken. We take judicial notice of the fact that the parking lot in question was neither a public way nor a highway. K. S. A. 8-555 and K. S. A. 8-556 (c) define the right-of-way between vehicles and pedestrians under certain conditions. As such, both 8-555 and 8-556 (c) are provisions relating to the operation of motor vehicles on highways and, .except as provided for in 8-502, supra, the statutes do not apply to private property. The conclusion is inescapable that 8-555 and 8-556 (c) are inapplicable to private property unless made so by 8-502, supra. The statutes in question are not mentioned in 8-502. The words “at all other places” in 8-555 refer to places on public highways with no traffic control signals, while the words “or other place of safety” in 8-556 (c) refer to places of safety on public highways other than curbs.
The court’s instruction No. 17 is taken directly from K. S. A. 8-532, which, by the express terms of K. S. A. 8-502 ( 2), is applicable to private property. As such, it was a correct instruction and properly given on the evidence presented by the record.
A review of the record shows the substance of appellant’s requested instructions 1 and 2 was given in the court’s instructions No. 15 and 19.
The appellant asserts the trial court erred in permitting the appellee to testify at the trial as to what he intended to state in his deposition, and in permitting the appellee to testify whether or not he would have elaborated on his answers at the time the deposition was taken had he been given an opportunity to do so by the appellant’s attorney.
It is always appropriate for a witness to rehabilitate his testimony, where an attempt is made on cross-examination to impeach his credibility. He should be given the opportunity to explain prior inconsistent statements. In any event, where matters tending to discredit a witness have been drawn from him on cross-examination, it is proper to permit him to explain such matters to rebut their discrediting effect. (In re Estate of Erwin, 170 Kan. 728, 740, 228 P. 2d 739.) Any witness may explain his deposition testimony which has been taken without the benefit of court supervision or intervention.
The trial court properly permitted the appellee to testify in an attempt to explain and clarify his prior deposition testimony.
Finally the appellant asserts the trial court erred in allowing the undersheriff of Ellis County, Clarence Werth, to testify as to the estimated speed of the appellant’s vehicle; the position of the appellant’s vehicle with respect to the street; and “contributing circumstances” to the accident.
It is an uncontroverted fact that Clarence Werth was the officer who investigated the accident. The appellant complains the appellee did not qualify Officer Werth as an expert witness. The narrative form of the record does not reveal whether the witness was or was not qualified as an expert.
“The qualifications of an expert and the admissibility of his testimony are matters within the sound discretion of the trial court, and unless the judge excludes die testimony he shall be deemed to have made the findings requisite to its admission. (Taylor v. Maxwell, 197 Kan. 509, 419 P. 2d 822.)” (Service v. Pyramid Life Ins. Co., 201 Kan. 196, 220, 440 P. 2d 944.)
As to the speed of the Goetz vehicle, the officer was not giving an opinion but was testifying to an admission made by Goetz shortly after the accident and recorded at that time on his accident report.
At trial, the objection to the testimony concerning the position of the Goetz vehicle was that the question was leading and irrelevant. On appeal the appellant argues an entirely different objection, the witness was not qualified as an expert.
‘Issues not raised or determined in the trial court will not be considered on appeal.” (State v. Darling, 208 Kan. 469, 475, 493 P. 2d 216, and cases cited therein.) (See also K. S. A. 60-404.)
This is essentially a fact case in which the issues were properly submitted to the jury. The jury performed its function and properly determined the issues submitted to it. There being substantial competent evidence to support the verdict it cannot be disturbed on appeal.
The judgment is affirmed. | [
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The opinion of the court was delivered by
Fatzer, C. J.:
This case involves the validity of Senate Concurrent Resolution No. 46 (Ch. 390, L. 1972), a proposition to amend the Constitution of the state of Kansas by revising Article 1 thereof relating to the executive branch of the state government Upon consideration by the court, the judgment of the district court that the amendment was not unconstitutional, is affirmed. This court is of the opinion the amendment was properly submitted pursuant to Art. 14, Sec. 1 of the Constitution, and was legally adopted by the people on November 7, 1972. A formal opinion will be filed when prepared. | [
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The opinion of the court was delivered by
Fatzer, C. J.:
This action was filed January 30, 1970, pursuant to K. S. A. 77-434, prescribing the remedy of declaratory judgment with respect to the validity, construction, or application of any regulation adopted by a state administrative agency. The plaintiffs were Ivan E. Rhodes and thirteen other regularly licensed doctors of medicine who were all residents of Sedgwick County and who practiced the profession of medicine in that county.
The action sought a declaratory judgment that certain administrative actions taken by the defendants, Robert E. Harder, State Director of Social Welfare (.director), the State Department of Social Welfare (department), and the members of the State Board of Social Welfare (board), prorating charges for medical and professional services rendered to eligible welfare recipients, exceeded the defendants’ statutory authority and adversely affected the plaintiffs and the fundamental policies upon which the Kansas state program of Medical Assistance is based. The plaintiffs have not asked for a recoveiy of money, although monetary damages have resulted; neither have they asserted their prayer for injunctive relief.
In 1965 Congress amended the Social Security Act by enacting “Title XIX” to provide medical assistance grants to any state wishing to provide medical care to its needy citizens. The program is commonly referred to as “Medicaid.” Any state desiring to operate a medical assistance program under Title XIX was required to have enabling welfare legislation and to develop and submit by administrative action a “state plan” to the secretary of Health, Education and Welfare (HEW) for approval. If the secretary determined the state plan complied with the requirements outlined by Congress for federal funding of the program, he was authorized to approve the plan. In addition, the participating state was required to show its plan complied with regulations promulgated by the secretary published in the “Handbook of Public Assistance Administration, Supplement D” (Supplement D).
In 1937 Kansas enacted the Social Welfare Act. (K. S. A. 39-701 et seq.) Pursuant to its provisions and on May 25,1967, the director developed and submitted to HEW a proposed state plan for medical aid assistance, which was subsequently approved by the secretary. In addition to the statute and the state plan, the director and the board promulgated certain administrative regulations relating to the Title XIX program which are published in Kansas Administrative Regulations (K. A. R.) 30-1-1 et seq.
As indicated, the sources of law involved in the question presented under the Kansas state plan for medical assistance are the Act of Congress (42 U. S. C. A. § 1396a et seq.), the federal regulations contained in Supplement D, the Kansas Social Welfare Act, the Kansas state plan, and administrative regulations supplemental to the state plan promulgated by the director and the board who are responsible for carrying out the Congressional and state legislative welfare policies.
The administrative action forming the basis for this declaratory judgment action is that on December 31, 1969, and effective January 1, 1970, the director and the board ordered that the regular charges of certain providers of medical services to- qualified recipients under the state plan be reduced or discounted automatically by 25 percent. The “order” or “directive” was under the signature of Robert C. Harder, the director, and purported to be authorized by K. A. R. 30-5-29. The plaintiffs contended the administrative order of December 31, 1969, effective January 1, 1970, directly contravenes the provisions of K. S. A. 1969 Supp. 39-708 (x) to the effect that providers of medical assistance shall receive their “reasonable, usual and customary charges” for services rendered to qualified recipients.
The defendants filed a motion to dismiss the action upon the grounds of improper venue and lack of jurisdiction which challenged the right of the plaintiffs to bring this action under Section 77-434. The motion was overruled.
Thereafter, the defendants answered, and admitted they were proper parties-defendant as the director and board and the department; that they were acting in an official capacity at all times; that the plaintiffs were regularly licensed doctors of medicine who resided in and practiced the profession of medicine in Sedgwick County; that the plaintiffs and all other practitioners who participated in and were providers of services under the Kansas medical assistance program were in the class described and referred to in Section 39-708 (x); that the director and the board were required by said statute to assure those practitioners who provided services under Title XIX and the Kansas medical program shall be paid the reasonable, usual and customary charges for such services; that the reasonable, usual and customary charges for such professional services were those charges which have been determined in accord anee with payment schedules for such services which are incorporated into the state plan and approved by the secretary of HEW. Further, that the payment schedules in said plan were in effect on January 1, 1970, and were based upon the legislatively imposed standard of “reasonable, usual, and customary charges.” The defendants further admitted the plaintiffs in reliance upon the terms of the state plan and Section 39-708 (x), have participated in said medical program and are currently participating therein and were providing medical services for eligible recipients when the action was filed.
The defendants further admitted that the 25 percent discount or proration applicable to the plaintiffs and certain provider groups, which discount or proration is the subject of this action, was determined and applied simply by automatically deducting 25 percent from any voucher submitted by a physician based upon the statutory standard of “reasonable, usual, and customary charges” for such providers as previously established in the state plan and as explicitly set forth in the payment schedule. In fact, the directive or order dated December 31, 1969, states that the 25 percent proration schedule is to be applied to “the regular charges for services” rendered after January 1,1970.
The district court sustained the plaintiffs’ motion for summary judgment and thereafter overruled the defendants’ motion for a new trial and for an order amending the judgment rendered therein. The defendants perfected this appeal.
The appellants contend the .district court erred in sustaining the appellees’ motion for summary judgment declaring K. A. R. 30-5-29 void as contrary to the provisions of K. S. A. 1969 Supp. 39-708 (x) and concluding administrative action taken pursuant to the regulation to be void as contrary to law.
As preliminary to a consideration of substantive issues, we turn to procedural issues raised by the appellants.
As indicated, this action was commenced to determine the validity and application of a state regulation. The provisions of K. S. A. 77-434 relating to declaratory relief concerning administrative regulations established certain procedural steps to be followed in instituting the action. The statute reads:
“The validity, construction or application of any regulation may be determined by an action for declaratory judgment thereon addressed to the district court of the county in which the plaintiff resides or has a principal place of business, or in the district court of Shawnee county, when it is alleged that the regulation or its threatened application interferes with or impairs or threatens to interfere with or impair the legal interest, rights, or privileges of the plaintiff. The agency shall be made a party to the action. The declaratory judgment may not he rendered until the plaintiff has first requested the agency to pass upon the validity of the regulation in question. The court shall declare the rule invalid if it finds that it violates constitutional or statutory provisions, or exceeds the statutory authority of the agency, or was adopted without substantial compliance with statutory rule-making procedures. [L. 1965, ch. 506, § 20; June 30.]” (Emphasis supplied.)
The appellants first contend the proper venue of the action was in the district court of Shawnee County. The point is not well taken. The record clearly indicates the appellees were all residents of Sedgwick County or had their principal place of business within that county. Under the facts and circumstances, and from the language of the statute, the action was properly commenced in the district court of Sedgwick County.
The appellants next assert the appellees did not request the department to pass upon the validity of the challenged regulation as a condition to instituting the action, and that it should have been dismissed. The language of Section 77-434 does not compel such a result. Its provisions do not state that no action may be brought against a state agency unless the administrative body has first passed on the validity of the regulation in question. Rather, it states “the declaratory judgment may not be rendered until the plaintiff has first requested the agency to pass upon the validity of the regulation in question.” (Emphasis supplied.) The requirement makes no mention of an allegation in the petition that the agency had been requested to rule on the validity of the challenged regulation, rior is there any inference that an agency adjudication on the questioned regulation is a condition precedent to the filing of an action for declaration relief. Moreover, the phrase, “the plaintiff has first requested the agency” (emphasis supplied), clearly indicates the request may be made after the action is filed.
The record indicates the appellees made written request on October 12, 1970, to the director and the board to construe the validity of K. A. R. 30-5-29. The appellants responded by letter dated October 22, 1970, that the challenged regulation was not unconstitutional; did not exceed statutory authority, nor was it in violation of rule-making procedures of K. S. A. 77-415 through 77-434, as amended. The judgment in this case was entered on July 26, 1971. This court has concluded the declaratory judgment was rendered subsequent to agency adjudication of the validity of K. A. R. 30-5-29, and holds there is no procedural infirmity in the appellees’ case in this regard.
The appellants next contend the district court erred in failing to make findings with respect to the appellees’ allegation they represented a class, pursuant to K. S. A. 60-233, of providers of medical and professional services under the Kansas Medical Assistance Program. At oral argument, counsel for the appellees stated he represented only the named plaintiffs and represented no one else iri the action. We have concluded therefore that no class action is presented regardless of the allegation in the petition to that effect.
Having disposed of the appellants’ contentions of procedural errors, we now turn to the substantive issues presented.
The question to be decided is whether K. A. R. 30-5-29 contravenes the provisions of K. S. A. 1969 Supp. 39-708 (x). It follows that if the challenged regulation is void, any administrative action' taken pursuant thereto is likewise void. The regulation in question (K. A. R. 30-5-29) reads:
“Providers of services; payments; determination. All payments to all providers of services under medical assistance are subject to the limitations of funds budgeted for the medical assistance program. Should funds for each fiscal year prove inadequate to meet all costs on the basis of fees and charges adopted, payment to providers will be made on a proration or discount basis. The provider groups to be prorated and the method and percentage of proration and the time at which it must be applied will be determined by the department of social welfare. (Authorized by K. S. A. 1967 Supp. 39-708, effective Jan. 1, 1967; amended Jan. 1, 1968; amended Dec. 4, 1969.)”
(Amended January 1, 1971 — changes not material herein.)
Section 39-708 (x) was in effect when this action was filed, and reads:
“The state board shall take such action as may be necessary to assure that licensed practitioners within the scope of their practice as defined by state law who provide professional services under the provisions of the federal social security act shall be paid their reasonable, usual and customary charges. Payment for other medical assistance under the provisions of the federal social security act shall be the reasonable, usual and customary charges: Provided, however, That if such payments are otherwise limited by federal law, such payments shall be as near the reasonable, usual and customary charges as may be permitted by federal law. [K. S. A. 39-708; L. 1965, ch. 286, § 1; L. 1967, ch. 245, § 2; L. 1969, ch. 226, § 2; July 1.]”
(L. 1969, Ch. 226, § 2, since amended.)
On December 31, 1969, the director ordered the regular charges of certain providers of medical services under the state plan re duced or discounted automatically by 25 percent, pursuant to the authority in K. A. R. 30-5-29. That communication reads in pertinent part:
“Re: Proration of Payment for Certain Services and Supplies
“To: All Providers of Services under the Kansas Medical Assistance Program, Title XIX
Chairmen County Boards of Social Welfare
County Welfare Directors
“It now appears reasonably certain that costs of the Medical Assistance program for the January to June 1970 period will exceed the funds available. Our best projection is a deficit for the period of $2,500,000. Therefore, in accordance with regulation 30-5-29 as amended December 4, 1969, the State Board of Social Welfare has directed that payments for medical services be prorated by applying to the regular charges for services rendered after January 1, 1970, the following discounts:
“Drugs
Eliminate the 500 fee added to prescriptions having an acquisition cost to the pharmacist of $5.00 or less 25%
“Physicians, Dentists, Osteopathic Physicians, Podiatrists and Chiropractors.”
The appellants contend the action taken in prorating fees for medical and professional services is not unlawful. First, they assert the proration was authorized by the Associate Regional Commissioner for Medical Services of HEW. The point is not well taken— the contention would seem to be an afterthought. Under the facts and circumstances of this case, a letter from the regional commissioner, while admittedly an interpretative rule, would have no effect upon a state law enacted by the legislature controlling the manner in which medical and professional services are compensated under the existing Kansas state plan.
Second, that K. S. A. 1969 Supp. 39-708 when read in its entirety authorizes proration administratively if the funds are not available to maintain present services at the fee schedule rates. In support of the contention, the appellants construe subsections (s) and (x) as authorizing the board to prorate payments made to medical vendors for medical and professional services rendered. The appellees, on the contrary, assert that any administrative action is limited by applicable law which clearly indicates that once a fee schedule is adopted by the state agency and approved by the secretary of HEW, that fee schedule constitutes the administrative action authorized by the state statute, and charges for medical and professional services consistent with that approved schedule cannot be prorated, upwards or downwards, without recertifying the state plan by federal approval of the secretary.
Pursuant to 42 U. S. C. A. 1302, the secretary of HEW is authorized to issue regulations concerning public health and welfare. The secretary has promulgated rules relating to the Title XIX program which are published by the secretary in the “Handbook of Public Assistance Administration Supplement D” heretofore noted. Regulations affecting payment for medical and professional services are set out in Sections D-5300 through D-5340. These various sections establish minimum standards for inclusion in state plans relating to medical and professional services. Section D-5320 requires the state plan to establish fee schedules which are designed to enlist participation of medical providers in the Medicaid program, and limits participation to those providers of medical and professional services who accept as payment in full the amounts paid in accordance with the adopted fee structures.
D-5340 contains the secretary’s interpretation of regulations relating to fee structures (schedules) for medical and professional services, and reads in pertinent part:
“The requirement for fee structures permits a variety of means which may be used in determining payments to providers of services other than hospitals. An underlying assumption is that adequate financing is available to pay the costs of the medical and remedial care and services included in the plan. Among the means which may be used in relation to practitioners’ services are usual and customary charges; negotiated fee schedules which allow fees equivalent or similar to those paid on behalf of individuals in similar financial circumstances by organizations that pay for substantial amounts of medical and remedial care and services . . .”
It may be said Supplement D essentially provides that a state may adopt one of several alternative types of payment structures for payment to medical providers under that state’s plan. Those alternative types of payment structures recognized by HEW which a state may adopt are: (1) reasonable, usual and customary, or prevailing charges; or (2) fixed fee schedules of maximum allowances; or, (3) payment structures based on relative value studies.
Within this context, the legislature chose by explicit statutory language to base its payment structure to providers of medical services under its Medicaid program upon the first-mentioned basis stated above, which was recognized and approved by the secretary of HEW. The language of 39-708 (x) casts the establishment of such payment structure in the form of an affirmative duty incumbent upon the appellants by stating that “the state board shall take such action as may be necessary to assure” that medical providers “shall be paid their reasonable, usual and customary charges.” As indicated, the fee schedule promulgated in the Kansas state plan contains a list of fees which have been established as the “reasonable, usual, and customary charges” for each service listed. Those fee schedules were attached to the state plan when it was approved by the secretary of HEW, and, insofar as it relates to this case, reads in part:
“4. The following is a description of the methods that will be used to assure that the medical and remedial care and services are of high quality, and a description of the standards established by the State to assure high quality care:”
# # # «fe #
“Fee schedules, for payment of medical services will relate to ‘reasonable, usual and customary charges.’ ”
# * # a a
“C. Payment for Medical and Remedial Care and Services (D-5300)
“1. Fee structures will be established which are designed to enlist participation of a sufficient number of providers of services in the program so that eligible persons can receive the medical care and services included in the plan at least to the extent these are available to the general population.
“2. Payments will be made only to medical vendors who sign agreements with the state under which the vendor agrees
“(a) to accept the payment in full, the amounts paid in accordance with the payment structures of the state:”
a a a a a
“6. ...
“Any change in payment structure for individual practitioner services will not become operative until such change has been incorporated in the State plan by an amendment submitted to, and approved by the Secretary.
“7. Payment stmctures regardless of type of individual practitioner services are based on usual, customary, and reasonable or prevailing charges. Kansas Blue Shield developed what is known as the prevailing fee plan. The primary principle of this plan is that it pays usual and reasonable charges in full as long as these charges do not exceed a basic maximum for the state.
“a. Definitions of terms usual, reasonable and customary:
“Usual — The charge one practitioner usually makes for a specific service or procedure.
“Reasonable — Is the charge for the service performed as measured by its relationship to all the other services performed. (Relative Values)
“Customary — The charge which is in normal agreement with the charges that other vendors of equal skills in the community make for the same service. (Prevailing)” (Emphasis supplied.)
* * » » a
“8. The following is a description of the policy and methods used in establishing payment rates for each type of care and service other than in-patient hospital service included in the State Plan. In no instance will the amount of payment under the plan exceed charges made to the general public for identical services.
“a. Physicians (Doctors of Medicine and Osteopathy) Dentists, Chiropractors, Podiatrists, Optometrists, and Opticians — Payment of these professional groups is on the basis of reasonable, usual, and customary fees. Established máximums are to be found in Appendices A, B, C, D, and E for each specific professional charge, according to the specialty. The Appendix compilations are located at the end of the State Plan.”
Thus, the state plan adopts by reference the fee schedules attached thereto and provides that any amendments to the established schedules, or any change in the payment structure to medical providers, shall not become operative until incorporated into the state plan and approved by the secretary of HEW. (See “6” quoted above.) This fact alone should end this lawsuit because there is nothing in the record that suggests or intimates the appellants made any effort or took any steps to have regulation 30-5-29 incorporated into the state plan and approved by the secretary of HEW pursuant to Title XIX and Supplement D. That being the case, the regulation would be totally ineffective and unenforceable for the reason it never became a part of the state plan authorizing payment for medical services rendered to eligible welfare recipients.
Be that as it may, we are of the opinion the district court did not err in holding that K. A. R. 30-5-29 and the director’s letter or order of December 31, 1969, went beyond and were in conflict with the legislative authorization of 39-708 (x) and that they were void.
We are of the opinion regulation 30-5-29 and the director’s letter of December 31, 1969, are invalid under decisions of this court. Willcott v. Murphy, 204 Kan. 640, 465 P. 2d 959; State, ex rel., v. Columbia Pictures Corporation, 197 Kan. 448, 417 P. 2d 255.) In Willcott it was held that regulations adopted by the State Director of Alcoholic Beverage Control, relating to the storage and sale of beer by retail liquor dealers, were void and it was held:
“The power of an administrative agency to adopt rules and regulations is administrative in nature, not legislative, and to be valid administrative regulations must be within the authority conferred. An administrative regulation which goes beyond or conflicts with legislative authorization is void.” (Syl. in.)
Applying the facts of the case at bar to the language used in Columbia Pictures, we quote the following:
“Are the rules and regulations adopted by the Board on [December 4, 1969], authorized by the statute? We think not. It will be observed the scope of the power granted in [39-708 (x)] deals with the power of the Board to make and adopt reasonable rules and regulations deemed necessary, not inconsistent with the laws of this state, for enforcing the provisions of the Act. The power granted is not the power to make rules and regulations which supersede existing laws enacted by the constituted lawmaking body, nor amend any law enacted for the purpose of [payment of medical services]. The authority to declare the public policy of this state is vested in tire legislature, not an administrative board, such as the Board of [Social Welfare] . . .”
« » * # «
“We conclude that, as applied to this case, the rules and regulations adopted by the Board of [Social Welfare] were unauthorized for the reason they were in direct contravention of the express terms of the Act.” (1. c. 454, 455.)
The above quote applies with great force to this case. Regulation 30-5-29, and tibe manner in which the appellants applied it by the letter of December 31, 1969, goes beyond any valid administrative or supervisory power vested in the appellants by the ligislature. Clearly, the appellants have no power to repudiate by regulation 30-5-29 its duty “to assure” that providers of medical services shall receive their reasonable, usual and customary charges as mandated by 39-708 (x). The fact the appellants used the regulation in such a way as to create what purported to be a new standard for payment of providers’ charges by reducing them 25 percent, is “out of harmony with” and “alters” the statute — i. e., the 'source of legislative power. Particularly this is true when there is nothing in the record to show that the appellants made any effort to have 30-5-29 incorporated in the state plan and secure its approval by the secretary of HEW. The adoption of 30-5-29 likewise attempts to “legislate” by administrative action a substitute standard in place of the legislative standard for payment of authorized charges of providers, which charges had theretofore been enumerated in the state plan and recognized as “reasonable, usual and customary” pursuant to state and federal law.
Under the issues presented and the facts and circumstances of this case, this court need not consider whether the appellees have an implied contract with the department. But see the unreported case of the United States District Court for the District of Kansas, entitled Seneca Nursing Home, et al., v. The Kansas State Board of Social Welfare, et al., civil action No. T-4779. Suffice it to say the state plan adopts a fee schedule which establishes the reasonable, usual arid customary charges required by 39-708 (x), and absent any statutory authority to prorate by directive, the appellants have no authority to adopt a regulation which purports to do so, nor does any administrative authority exist by virtue of the provisions of 39-708 to take the action asserted by the appellants’ letter of December 31,1969.
This court holds the provisions of 30-5-29 and the administrative action taken thereunder by the board directing proration of fees subsequent to December 31, 1969, to be beyond the authority of 39-708 (x) requiring fees for medical arid professional services to be the reasonable, usual, and customary charges. (2 Am. Jur. 2d, Administrative Law, § 289, p. 118; State, ex rel., v. Columbia Pictures Corporation, supra; Willcott v. Murphy, supra; Grauer v. Director of Revenue, 193 Kan. 605, 396 P. 2d 260; Stanley v. United Iron Works Co., 160 Kan. 243, 160 P. 708; Ryan and Carpenter, Dubious Doctrines in Administrative Law, with Federal-Kansas Emphasis, 11 Washburn L. J. 351, 356 [1972].)
In passing, we note that K. S. A. 1969 Supp. 39-708 was amended by the legislature in 1970 (L. 1970, Ch. 167, § 1.) The language of subsection (x) was retained in its 1969 form. Subsequently, in the 1971 session, K. S. A. 1970 Supp. 39-708 was amended (L. 1971, Ch. 153, § 1), and subsection (x) was substantially changed by removing the words “usual and customary” from the first sentence. However, in 1972, the legislature amended 39-708 arid inserted the words “usual and customary” once again into subsection (x).
The subsection now reads:
“(x) The state board shall take such action as may be necessary to assure that licensed practitioners within the scope of their practice as defined by state law who provide professional services under the provisions of the federal social security act shall be paid their reasonable, usual and customary charges. Payment for other medical assistance under the provisions of the federal social security act shall be the reasonable, usual and customary charges: Provided, however, That if such payments axe otherwise limited by federal law, such payments shall be as near the reasonable, usual and customary charges as may be permitted by federal law.” (Emphasis supplied.)
In light of the subsequent legislative action concerning K. S. A. 1972 Supp. 39-708 (x), it must be concluded the present provisions of 30-5-29 are beyond the scope of administrative authority delegated to the department, arid are void.
Finally, the appellants contend the district court erred in granting summary judgment because there were material facts still in dispute. The appellants’ proffer of evidence at the hearing on the motion for a new trial related to budgetary limitations placed upon the department in 1970, and the need for proration to insure that all services provided by the department would be continued. We note the appellants concede the existence of the state plan and the incorporated fee schedules. Placing the state plan in harmony with the federal stautory and regulatory requirements and the state statutory requirements, we have concluded the regulation arid the administrative action taken to be without any legal authority as a matter of law. That being the case, the existence of fiscal problems would have no bearing upon our decision, and we hold the district court did not err in entering summary judgment in this case.
The judgment is affirmed. | [
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Per Curiam:
This is an appeal from an order denying relief under K. S. A. 60-1507.
Appellant raises a single issue: He was denied the effective assistance of an attorney because counsel had not been appointed for him prior to the date of his arraignment. It is his position that the district court was required to have an evidentiary hearing on the matter with him in attendance.
The trial court’s order of July 26, 1971, upon appellant’s motion to vacate the judgment in case number B-4238, shows that the court had examined the motion, the file and the records in that case. The trial judge states that “the files and the records reflect that Mr. Roscoe Austin was appointed and did represent the defendant from one day after the crime was committed, to-wit: July 30, 1960, continuously through January 3, 1961, when the defendant was convicted and sentenced;” that “the motion, file and records of this case conclusively show that movant is entitled to no relief and that his motion should be denied.”
On this record, and pursuant to Rule No. 121 (f) and (i) (201 Kan. XXXII) the court did not err in denying an evidentiary hearing and in denying relief.
Judgment is affirmed. | [
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The opinion of the court was delivered by
Fatzer, C. J.:
This was an action to recover premiums paid on insurance policies alleged to have been sold by misrepresentations of the company agent as to the benefits to be received under the policies.
The case was tried to the court without a jury. Judgment was rendered in favor of the plaintiffs and the defendant has appealed.
The appellant, Farm & Ranch Life Insurance Company, Inc. (insurance company), contends the district court erred in granting judgment for the appellees, Robert Aaron Moore and Thelma Ruth Moore, husband and wife (hereafter referred to as the Moores, the appellees, Robert or Thelma), because the testimony shows as a matter of law their claim for relief is barred by the applicable statute of limitations; that appellees have waived any right to relief, and that they have ratified all of the transactions on which they base their claim. The appellant also objects to certain findings of the district court as not being supported by the evidence.
While the appellant claims as error the failure of the district court to grant summary judgment on the pretrial depositions, there is no material conflict between the depositions and the oral testimony, and it would serve no useful purpose to make a separate presentation of that particular issue.
The posture of the case now before us presents factual questions. The appellees reside near Ulysses, in Grant County. Robert was 46 years of age, a high school graduate and a farmer who owns and operates his own farm. Thelma was 39 years of age, a high school graduate, and assisted her husband in the farming operation. The appellees were at all times material hereto familiar with the operation of corporations as business entities and understood that dividends are paid out of the profits of a corporation as determined by the board of directors thereof.
The appellant is a Kansas corporation duly licensed and qualified to carry on the insurance business within the state of Kansas.
Prior to January 12, 1966, John Foster, an agent of the appellant, called Robert late one evening and told him he had been recommended by Howard Phifer, a resident of Ulysses, who thought he would be interested in what the agent had to sell, and asked if he would like to make some money. Robert said he was interested and they arranged a meeting. On January 12, 1966, Foster called on Robert and Thelma at their farm home and presented them with a letter of introduction from Howard Phifer. Foster spent between three and four hours with the Moores that evening. Thelma testified:
“Mr. Foster told us that this was an investment plan that would be offered to a limited number of people in each county. He said that we were going to receive dividends of at least 10%, that they had already paid a 10% dividend that year, that they were going to pay 16%, and that the dividends would continue to grow. This investment plan also had some life insurance in it and all our premiums would be returned. In a few years the policy would be paying for itself and after that it would be more than paying for itself so we would actually get back money over and above our premium.
“He said this was like stock in a company and in the Ulysses Co-op in that we were going to share all of the earnings of the company. The company had applied to expand into other states and we would share in these earnings. Only the people who had the investment plan would share in these earnings.
“He told us that in addition to this investment plan we would have an insurance policy.
“He told us that at the beginning there would be a large amount of insurance which would decrease in amount with time. But as the life insurance decreased the dividends and the return premium benefit would be there. We were going to get all our money back; all the premiums we paid in we would get back at death. He showed us a policy he had with him on his own life, but he did not go over it in detail or read all the paragraphs to us.
“He pointed out his return premium benefits and that the dividends were going to start at 10% the second year. We were led to believe that the 10% would be on the accumulated investment.”
Based upon the above representations, the Moores purchased seven policies covering each of them and each of their five children, ranging in ages from five to fourteen years. The annual premiums totaling $2,345.57 were paid. The seven policies were later delivered to the Moores and placed in a filing cabinet. They did not read the policies, but took Foster s word as to what they stated.
After hearing a conversation relative to a newspaper article to the effect that persons buying Farm & Ranch Life Insurance Company’s policies were not getting what they thought, Thelma, on July 28, 1966, wrote to the Insurance Commissioner of the State of Kansas, and enclosed for his analysis one of the pohcies purchased on January 12, 1966.
In that letter Thelma complained of the policies having been misrepresented to them by Foster and stated they had been led to believe they were purchasing stock with guaranteed dividends. Shortly after July 28, 1966, the Insurance Commissioner wrote Thelma explaining that a life insurance policy was not stock in the life insurance company and that all dividends paid on such a policy were subject to the discretion of the board of directors of such life insurance company.
In January, 1967, when the second annual premium came due on the seven policies purchased by the Moores, they determined not to pay the premiums. As a result of non-payment of the premiums, the policies lapsed. On July 7, 1967, Merle Hoppe and Bill Quillen, agents of the appellant, visited the Moores’ home. At that time Hoppe and Quillen spent several hours with the Moores going over the policies and particularly the provisions relating to dividend benefits. They told the Moores that no doubt they would get their premiums back, that the dividends were so very good that they could not afford to drop the policies. Based upon those statements, the Moores paid the second annual premium. Later, they were told by their neighbors that before a return of premium would be available on those policies of insurance, the insured had to die before the age of 65. More letters were then written by Thelma attempting to secure explanations from the company.
Prior to January 18, 1968, the Moores received notice from the appellant that dividends on their policies had been declared but in accordance with instructions from the Moores the dividends were being used to purchase additional insurance. On January 18, 1968, Thelma wrote the appellant seeking clarification of the basis upon which dividends were paid. On January 23, 1968, the appellant responded and explained that the company paid a dividend of 11% in 1967. Thereupon, the Moores paid the third annual premium.
Subsequently, the Moores became dissatisfied with their policies and wrote to the appellant on March 26, and March 30, 1968, complaining primarily of the fact that they did not own stock in the company and that the dividends were not guaranteed. They stated they had been led to believe they would receive the return of all premiums paid on their life insurance no matter when they died, and that they had not been advised they would have to die prior to the contract anniversary date nearest their 65th birthdate in order to receive the benefits.
On May 29, 1968, Hoppe again visited with the Moores in an attempt to get them to reinstate the policies or in the alternative to secure other insurance. When informed they had sought legal counsel he encouraged them not to continue to seek legal aid but rather to write the president of the company, which Thelma did.
On January 7, 1969, this action was brought to recover the three annual premiums paid on the seven policies in the total amount of $7,042.71; mental anguish, pain and suffering, $5,000, and punitive damages including attorney fees in the further sum of $7,500. On January 13, 1969, Mr. Leland J. Braun, the Moores’ attorney, wrote the appellant at their request, and demanded payment of all accrued interest and dividends. The letter reads:
"Gentlemen:
“For and in behalf of the owners of the above entitled policies we are herewith requesting that all accrued interest and dividends on each and every one of the above policies be paid to the owners in care of this firm in cash. Further, we are to advise you that the owners will not pay the premiums on the anniversary date and are considering the policies cancelled in light of the further action that will be taken.
“Yours very truly,
“Leland J. Braun”
On January 10, 1969, the appellant issued seven checks, one on each of the insurance policies, representing the dividends earned during the year 1968. The checks were mailed to Mr. Braun, and on January 21, 1969, they were endorsed and cashed by the Moores. The proceeds from the checks and the seven insurance policies were retained by the Moores. Thelma testified:
“A. ... In January 1969 we had Mr. Braun, representing us, demand payment of the dividends on these policies. We received a dividend check on each policy after this lawsuit was filed. On January 1, 1969, we knew we did not have stock in the company, that the dividends were not guaranteed, and that in order to obtain the return of premium benefit we had to die before age 65.
“Q. And yet knowing all of that you still demanded, received, and accepted benefits under each of these policies, didn’t you?
“A. Yes, because we had paid our premiums and we were entitled to those.
“Q. Oh, you were actually wanting the benefits that you were entitled to under the contract?
“A. Well, we felt we were entitled to those and so we asked for them.
“Q. Well, you felt that the contract were in force, didn’t you?
“A. Yes, we had paid our premium.
“Q. Right, and had you died any time up to that point you would have expected to receive a death benefit, would you not?
“A. I imagine, we paid our premiums.
“Q. So you were treating the contracts and insurance policies as in force at that time, were you not?
“A. Yes. As we understood them we were to get back all premium benefits and that is the reason why we paid our second two premiums.
“Q. We’re talking now about a time, January, 1969, quite a while after you had discovered any alleged misrepresentation. I think you said that you found out in February of ’68 that the return of premium benefit did not apply if you died after age 65, isn’t that true?
“A. It was in February or March.
“Q. February or March?
“A. Yes.
“Q. And after that date you negotiated with the company to convert those policies to other policies, didn’t you?
“A. Pardon?
“Q. After that date that you found that out you still went ahead and negotiated with the company to convert those policies, didn’t you?
“A. Yes.
“Q. You retained possession of them, didn’t you?
“A. Yes.
“Q. In fact you retained possession of them until today when you brought them to Court?
“A. Yes.
“Q. Did you ever send them back to the company and didn’t want them any more and they were canceled?
“A. No.
“Q. And in January of ’68 [’69] you demanded, received, and accepted benefits under those policies, didn’t you, for dividends due?
“A. Yes.
The district court made findings in harmony with the facts stated, and concluded, in part:
“(1) From the above detailed testimony, this Court concludes that John Foster, salesman and agent by means of a preferential local connection with Mr. Phifer, innuendoes and puffing knowingly led the plaintiffs to falsely believe as an introductory and influential contact, they were receiving stock and insurance in a rapidly growing company. After the initial payment of two or three premiums the earnings from investment would, based on the company’s past operations, take care of all future premiums; and the plaintiffs would have paid up insurance for $5,000.00 on each of the seven family members of the respective age of 65 years with decreasing term death benefits.
“(2) The plaintiffs apparently did not realize that in order to receive the decreasing term death benefits and to carry out in full the contract terms they would pay as premiums many times the paid up face value of the policies. The agent, Mr. Foster, as a result of the several hours of conversation together with the general set up well knew and realized that the Moores had received such false impressions, which he planned and expected but was particularly careful to stay within the law as he interpreted it.
“(3) The plaintiffs, through hearsay from their neighbors, became suspicious and after receiving a reply to their letter from the Commissioner of Insurance, informed the defendant they were not going to pay the second premium and asked for a return of their money.
“(4) Thereupon, officers of the defendant took advantage of the gullible but human factor that plaintiffs were exceptionally vulnerable in their desire not to lose their investment of $2347.57. They personally called on the Moores and, by assuring them that they had and were making a good investment, persuaded them to pay the second premium and with subsequent calls also persuaded them to pay the third premium. The overall tactics, including the insurance policy itself, has the appearance of the old come-on game.
“(5) The Court further concludes that the defendant’s actions, from the inception of its first contacts made in Grant County and continuing until 1968 when the plaintiffs first consulted a lawyer, constituted actual and continuing fraud on the plaintiffs which entitled plaintiffs to rescission of the insurance contracts but which has elapsed by non-payment of subsequent premiums. Thus, plaintiffs are entitled to judgment for restitution in the amount of $7,042.71, less $553.47 paid to plaintiffs on January 13, 1969, at the request of plaintiffs’ attorney.
“(6) This Court does not construe the receipt of the $553.47 as an act invoking the rule of estoppel since the attorney’s demand made it clear that further action would be taken. It was an offset rather than a benefit. The continuing and persuasive actions by the defendant’s employees indicate they were well informed of the equitable rules that required plaintiffs to act promptly in order to rescind the contract and that the acceptance of any benefits under the contract would act as an estoppel in a suit for cancellation as well as the statute of limitations. As a summary, this Court concludes it would be unconscionable to apply the doctrines of prompt rescission and estoppel in this case.”
The district court deducted the dividend payment made for 1968, in the amount of $553.47, and rendered judgment for the plaintiffs, appellees here, in the amount of $6,489.24.
We now turn to the specific questions raised by the appellant.
It will suffice to state that the question as to the sufficiency of the evidence to support the district court’s findings, and the question of when the fraud was discovered starting the running of the statute of limitations, require the weighing of evidence, the consideration of the credibility of witnesses, and inferences to be drawn from the testimony. These are matters which an appellate court may not consider on appeal.
Without detailed consideration of the above questions, we turn to the next issue on which there is no conflict in the testimony or dispute as to the facts. Did the appellees waive any right to relief and ratify all transactions on which the action was brought?
Appellees testified to three distinct representations which they claimed to be fraudulent — (1) appellees would own stock in the company; (2) the dividends would be guaranteed, and (3) that a return premium benefit would be paid even though the insured died after the age 65.
As early as the summer of 1966, the Moores learned through correspondence with the Kansas Insurance Commissioner that they owned no stock in the company and that the dividends were not guaranteed. They based this action on the alleged false representation that there would be a return of premiums as well as the payment of $5,000 face value of each policy, even though the insured died after age 65.
The appellees admit the discovery in February or March, 1968, that there would not be a return of premiums if the insured died after age 65. Yet they waited until January 7, 1969, to file an action for the return of the premiums paid over the three-year period. They did so to reap the full benefit available under the seven policies. Although repetitious, we quote again Thelma’s testimony on the point:
“Q. And yet knowing all of that you still demanded, received, and accepted benefits under each of those policies, didn’t you?
“A. Yes, because we had paid our premiums and were entitled to those.
“Q. Oh, you were actually wanting the benefits that you were entitled to under the contract?
“A. Well, we felt we were entitled to those and so we asked for them.
“Q. Well, you felt that the contracts were in force, didn’t you?
“A. Yes, we had paid our premium.
“Q. Right, and had you died any time up to that point you would have expected to receive a death benefit, would you not?
“A. I imagine, we paid our premiums.”
Even after filing this action, they demanded and received the dividends due under the policies for the year 1968.
This court is compelled to agree with the appellant’s contention that the appellees by their conduct waived any right to relief they may have had because of misrepresentations in the sale of the insurance contracts and their purchase thereof.
In Cleaves v. Thompson, 122 Kan. 43, 251 Pac. 429, this court held:
“Where a party desires to rescind a contract on the ground of fraud and misrepresentations, he must, upon discovery of the facts, at once or within a reasonable time, announce his purpose and adhere to it.” (Syl. ¶ 1.)
If a party be silent and continue to treat a contract as valid until he has received all of the benefits thereunder, he will be held to have waived any claim of fraud. Morse v. Kogle, 162 Kan. 558, 178 P. 2d 275, is one of the leading cases on the issue here presented. There it was held:
“One who seeks to rescind a contract on the grounds of fraud must do so with reasonable promptness after discovery of the fraud.
“If, after discovery or knowledge of facts which would entitle a party to a contract to rescind the contract, he treats the contract as binding and leads the other party to believe that the contract is still in effect, he will have waived his right to rescind.
“In order to constitute such a waiver, it is not necessary that there be an express ratification of the contract after discovery of the fraud which might make the equitable remedy of rescission available. Acts or conduct inconsistent with an intention to rescind it, or in recognition of the contract, may have the effect of affirming it.” (Syl. ¶¶ 1, 2, 3.)
The rule stated in Morse was also followed in Curry v. Stewart, 189 Kan. 153, 368 P. 2d 297. In Nichols Co. v. Meredith, 192 Kan. 648, 391 P. 2d 136, it was said:
“In Morse v. Kogle, 162 Kan. 558, 178 P. 2d 275, this court, in a well-annotated opinion discussing the right to rescind a contract for fraud, stated it was well settled that one who seeks to rescind a contract for fraud must do so promptly upon discovery of the fraud, and if by words or conduct he treats the contract as binding after having knowledge of the fraud, he thereby affirms the contract and cannot rescind. It was further stated that ordinarily an express ratification is not necessary in order to defeat the remedy of rescission. Acts or conduct, inconsistent with an intention to avoid it, or in recognition of the contract, have the effect of an election to affirm it. For cases cited supporting the mentioned rules of law and other applicable rules see Cleaves v. Thompson, 122 Kan. 43, 251 Pac. 429; Turner v. Jarboe, 151 Kan. 587, 100 P. 2d 675; Wells v. Albers, 122 Kan. 643, 253 Pac. 412; Dobie v. Sears Roebuck & Co., 164 Va. 464, 180 S. E. 289, 107 A. L. R. 1026; and McLean v. Clapp, 141 U. S. 429, 12 S. Ct. 29, 35 L. Ed. 804. Only recently in Brown v. Wolberg, 181 Kan. 919, 317 P. 2d 444, we again emphasized the equitable remedy of rescission is open only to the diligent, and one who seeks to rescind a contract on the ground of fraud and misrepresentation must do so with reasonable promptness after the discovery of the fraud.” (1. c. 653.)
It does not matter whether the court is dealing with waiver, ratification, or equitable estoppel, a party will not be permitted to accept the benefit of a contract, with full knowledge of all of the facts, and then deny his own responsibility thereunder. (Bank v. Jesch, 99 Kan. 797, 163 Pac. 150.) See, also, Pattison v. State Farm Fire & Casualty Co., 209 Kan. 167, 172, 495 P. 2d 975, and Thompson v. Anderson, 209 Kan. 547, 556, 498 P. 2d 1.
The judgment is reversed with instructions to the district court to enter judgment for the appellant. | [
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Per Curiam:
Appellant Bruce L. Brooks was convicted in the Saline County District Court on November 13, 1968, of the offense of burglary and burglarious larceny, and his sentence was enhanced under the habitual criminal act, K. S. A. 21-107a, on the basis of a prior felony conviction of second degree burglary in the state of California. The convictions were affirmed by this court in State v. Brooks, 206 Kan. 9, 476 P. 2d 617. On March 3, 1971, appellant filed his motion pursuant to K. S. A. 60-1507 seeldng vacation of the sentences on the ground there was no valid proof of a prior felony conviction in the state of California. The motion was summarily denied and this appeal perfected.
At the sentence hearing in the Saline County District Court on December 17, 1968, the state introduced duly authenticated copies of the information, orders and minutes from Case No. A 102412 in the Superior Court of the State of California for the County of Los Angeles, entitled People v. Bruce Laverne Brooks, Jr., showing that appellant was represented by counsel, was convicted on a plea of guilty of the violation of section 459 of the Penal Code of California of the crime of burglary in the second degree; that the proceedings were suspended and the appellant was placed on probation. At this hearing, appellant and his counsel requested permission of the court to explain the circumstances surrounding his plea of guilty in the California case. The court advised appellant of his right to remain silent. However, he stated that he understood that he was not required to make any statement but he wished to do so voluntarily. He then stated in pertinent part that he thought he was pleading guilty to a misdemeanor; that he was placed on probation serving four months in the county jail; that he had not been released from probation; and that he had taken no action to get the conviction changed from a felony to a misdemeanor. The trial court determined that the California conviction constituted a felony, and accordingly enhanced the sentence. The sole question presented is whether the California conviction amounted to a felony or a misdemeanor.
Section 461 of the Penal Code of California (West’s Ann. Penal Code) provides punishment for burglary in the second degree by imprisonment in the county jail not exceeding one year, or in the state prison for not less than one year or more than fifteen years. Section 17 of the Penal Code as applicable in 1967 provided:
“A felony is a crime which is punishable with death or by imprisonment in the state prison. Every other crime is a misdemeanor. When a crime, punishable by imprisonment in the state prison, is also punishable by fine or imprisonment in a county jail, in the discretion of the court, it shall be deemed a misdemeanor for all purposes after a judgment imposing a punishment other than imprisonment in the state prison. . . . Where a court grants probation to a defendant without imposition of sentence upon conviction of a crime punishable in the discretion of the court by imprisonment in the state prison or imprisonment in the county jail, the court may at the time of granting probation, or, on application of defendant or probation officer thereafter, declare the offense to be a misdemeanor.”
In People v. Williams, 27 Cal. 2d 220, 163 P. 2d 692, the California court, in construing earlier versions of the mentioned statutes, held that burglary in the second degree is punishable by imprisonment in the state prison (Penal Code §461) and is therefore a felony. (Penal Code, § 17.) While it is also punishable in the alternative by a county jail sentence (Penal Code, § 461), its status can be changed only by a judgment imposing a punishment other than imprisonment in the state prison. The court further held that:
“. . . ‘The necessary inference to be drawn from the language of section 17 of the Penal Code that “When a crime, punishable by fine or imprison-men in a county jail, in the discretion of the court, it shall be deemed a misdemeanor for all purposes after a judgment imposing a punishment other than imprisonment in the state prison,” is that the offense remains a felony except when the discretion is actually exercised and the prisoner is punished only by a fine or imprisonment in a county jail.’ ”
More recently, in an analogous case of People v. Esparza, 253 Cal. App. 2d 362, 61 Cal. Rptr. 167, cert. den. 390 U. S. 968, 88 S. Ct. 1082, 19 L. Ed. 2d 1174, the court held:
“. . . It is settled that where the offense is alternatively a felony or misdemeanor (depending upon the sentence), and the court suspends the pronouncement of judgment or imposition of sentence and grants probation, the offense is regarded a felony for all purposes until judgment or sentence and if no judgment is pronounced it remains a felony (People v. Banks, 53 Cal. 2d 370 [1 Cal. Rptr. 669, 348 P. 2d 102]; People v. Williams, 27 Cal. 2d 220 [163 P. 2d 692]; People v. Lippner, 219 Cal. 395 [26 P. 2d 457]). It is of course true that the appellant spent 10 months in the county jail, but this confinement was a condition of probation and did not constitute a sentence within the meaning of Penal Code section 17. . .
See also People v. Livingston, 4 Cal. App. 3d 251, 84 Cal. Rptr. 237; People v. Bozigian, 270 Cal. App. 2d 373, 75 Cal. Rptr. 876.
It is apparent from the record in the instant case that upon appellant’s conviction in California, the court suspended the proceedings without imposition of sentence and without declaring the offense to be a misdemeanor and granted Rrooks probation. As appellant stated, he was still on probation and had taken no action to get the conviction changed from a felony to a misdemeanor. Inasmuch as the California court had not declared the offense to be a misdemeanor, and no judgment or sentence had been imposed, his conviction remained a felony for all purposes pertinent herein. Although appellant spent four months in the county jail, this confinement was a condition of his probation and did not constitute a sentence within the meaning of section 17 of the Penal Code.
The trial court did not err in concluding the California conviction to be a felony and in imposing sentence under the Kansas Habitual Criminal Act.
The judgment is affirmed. | [
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Per Curiam:
This is a proceeding instituted pursuant to K. S. A. 60-1507. The District Court of Sedgwick County, Kansas denied a motion to vacate the sentences imposed against the appellant. Appeal has been duly perfected.
The pertinent facts are briefly summarized.
On December 23, 1969, appellant was arrested and charged in Sedgwick County with two counts of first degree robbery, two counts of felonious possession of a pistol, and one count of third degree burglary and larceny. Shortly after his arrest he retained Richard Hilton as his attorney. On February 22, 1970, appellant escaped from the Sedgwick County jail and was apprehended on February 26th. He was charged with escape and resisting arrest. Following a preliminary hearing on the charges he was bound over to the district court for trial. Prior to appellant’s arraignment, he was served with notice of intention to invoke the habitual criminal statute, K. S. A. 21-107a.
On April 2,1970, with his retained counsel present, appellant was arraigned in the Fourth Division of the Sedgwick County Court in Case No. CR6383, on charges of first degree robbery and felonious possession of a pistol, and in Case No. CR6404 on charges of first degree burglary, larceny and felonious possession of a pistol. In each case the court inquired whether appellant was fully aware of the charges lodged against him, and he replied, ‘Tes.” The court proceeded in detail to inform appellant of the exact nature of each charge, and then inquired of him whether: (1) He had discussed the charges with his attorney; (2) He was deciding to plead guilty because he was guilty; (3) He was pleading guilty of his own volition and not because of any threats or promises.
Appellant answered each inquiry in the affirmative and entered a plea of guilty to each charge. He then reiterated that he was pleading guilty because he was guilty. At allocution appellant stated that there was no reason why sentence should not be pronounced. The state introduced evidence of appellant’s prior convictions for the purpose of enhancing the sentences on the robbery convictions. The court then sentenced appellant to serve from 20 to 42 years on each robbery count, and from 1 to 5 years for possession of a pistol, and from 1 to 5 years on the burglary count, each to run concurrently.
On April 7, 1970, appellant was arraigned in Division Two of the District Court of Sedgwick County in Case No. CR6536 for escaping Jail and resisting arrest. He was present with his attorney. He again waived trial by jury and entered his plea of guilty to the crimes charged. The court inquired of him whether: (1) He was pleading guilty because he was guilty; (2) He did in fact escape and resist arrest; (3) He was pleading guilty of his own volition. Appellant answered each inquiry in the affirmative. At allocution he stated that there was no legal reason why sentence should not be pronounced. The court sentenced appellant to serve from 1 to 5 years in the state penitentiary on each count, and upon the state’s request, each was ordered to run concurrently with the other sentences previously imposed as above related. Appellant was confined to the Kansas State Penitentiary on May 1, 1970.
On June 26, 1971, fourteen months after he entered his pleas of guilty and was sentenced, appellant wrote a letter to the sentencing court which was filed in Case No. 6536, in which he stated that he had been informed prior to the arraignment of the state’s intention to request the imposition of the habitual criminal act; that his attorney explained the effect which the enhancement would have upon his sentence in the event he was convicted, and after several discussions with his attorney about the possible alternative sentences, he elected to plead guilty and accept the sentence of from 20 to 42 years.
Thereafter, on September 10, 1971, appellant filed his motion pursuant to K. S. A. 60-1507 requesting that his guilty pleas in Cases CR 6536 and CR 6404 be withdrawn so that he might enter pleas of not guilty and go to trial on the charges. He does not question the pleas of guilty in Case CR 6383 in which he entered pleas of guilty to first degree robbery and felonious possession of a pistol, and on which he is now serving two concurrent terms of from 20 to 42 years.
The district court, after reviewing the record, summarily denied appellant’s motion. This appeal followed.
In the court below appellant relied upon three claims to support the post-conviction relief sought. One claim was that he was denied counsel at a lineup. The second claim was that he was denied counsel during an interrogation. Both of these claims relate to irregularities which could only have occurred in proceedings prior to appellant’s pleas of guilty. It has been consistently held that when a person accused of crime enters a plea of guilty on arraignment, he is deemed to have waived irregularities which may have occurred in the proceedings prior thereto (State v. Kilpatrick, 201 Kan. 6, 14, 439 P. 2d 99; Perry v. State, 200 Kan. 690, 693, 438 P. 2d 83; Stiles v. State, 201 Kan. 387, 389, 440 P. 2d 592; State v. Talbert, 195 Kan. 149, 402 P. 2d 810, cert. den. 382 U. S. 868, 15 L. Ed. 2d 107, 86 S. Ct. 143).
This brings us to the final claim of error, that the trial court erred in summarily concluding that appellant’s guilty pleas were knowingly and voluntarily entered.
If there is no substantial issue of fact or question of law raised by appellant’s motion the trial court is not required to appoint counsel or hold an evidentiary hearing. (Wood v. State, 206 Kan. 540, 479 P. 2d 889.) When the movant alleges facts outside the original record which, if true, would entitle him to relief and when he lists witnesses who may be called to verify those facts then and only then is he entitled to an evidentiary hearing on his motion. (Floyd v. State, 208 Kan. 874, 495 P. 2d 92.)
In the instant case appellant alleged that his pleas of guilty were not knowingly and voluntarily entered because he misunderstood the sentences he was to receive. The record shows otherwise.
The appellant was represented by competent counsel of his own choice at all stages of proceedings, including the preliminary hearing, arraignment and allocution. Prior to each of appellant’s pleas, he stated that he understood the charges filed against him, decided to waive a Jury trial, discussed the cases with his counsel, decided to plead guilty of his own volition and not because of any threats or promises.
In his letter to the court on June 26, 1971, prior to filing the present motion, he stated that he had been informed of the sentencing alternatives available and that he voluntarily chose to accept from 20 to 42 years with all other sentences running concurrently on pleas of guilty.
The record conclusively indicates that the appellant’s pleas of guilty were voluntarily and understandingly made, and that appellant was diligently represented by competent counsel at all stages of the proceedings. He received the exact sentences which his attorney had informed him he would receive if he pled guilty.
The appellant’s grounds set forth in his motion are without merit and the district court properly denied the relief sought without an evidentiary hearing.
In view of what has been said, judgment of the trial court is affirmed. | [
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The opinion of the court was delivered by
Kaul, J.:
This is a quiet title action in which plaintiffs seek to quiet their title to an undivided one-half mineral interest in a half section of land in Lane County. Plaintiffs and their predecessors in title are and have been the undisputed owners of the surface rights and a one-half interest in the mineral rights in the land in question.
The controversy stems from the failure of the original grantees to record the instrument of conveyance or to list for taxation the undivided one-half mineral interest as required by K. S. A. 79-420 and its forerunners. The provisions of the statute will be subsequently set out and discussed in the course of this opinion.
On April 22, 1929, Henry Becker and his wife, Laura, the then owners of the land, executed and delivered a conveyance of an undivided one-half interest in minerals in place to S. D. Leighton by Fred Hyames, trustee. Even though the instrument of conveyance was entitled “Sale of Oil and Gas Royalty” because of the language used therein, the parties concede that it constituted a mineral deed and there is no dispute concerning this matter.
Plaintiffs acquired the remaining interests, both surface and mineral, of Henry Becker by inheritance and conveyances. The defendants-appellants, Samuel Ben Leighton and his wife, Doris, and Cynthia June (Leighton) Carroll and her husband, Clyde, claim title to an undivided %áth interest in the mineral rights through inheritance from S. D. Leighton, an original grantee. This interest will be referred to hereafter as the Leighton-Carroll interest. Defendant-appellant Warren Munsel, the other appellant in this appeal, claims an undivided 14th interest in mineral rights. The devolution of his claim will be traced hereafter.
Leighton-Carroll and Munsell were the only interests appearing in opposition to plaintiffs’ quiet title action in the court below wherein judgment was rendered for plaintiffs as prayed for. Thus, the posture of the parties on appeal is that plaintiffs are now the undisputed owners of the surface rights and %tths of the mineral rights. The disputed interests being the bUth mineral interest claimed by Leighton-Carroll and the 14th or %4ths mineral interest claimed by Munsell.
The mineral deed conveying the interest in question from Henry Becker to S. D. Leighton was executed and delivered on April 22, 1929. It was not recorded until almost a year later on April 5, 1930, and it was not listed for taxes prior to recording. Subsequently, in disregard of the apparent invalidity of the mineral deed, the interests conveyed thereunder were assessed for taxes by Lane County for the years 1933, 1934 and 1935. These taxes were paid by Fred Hyames, trustee. No assessment was made against the claimed mineral interests again for ten years, or until 1946. Taxes have been assessed and levied against the claimed mineral interests for the year 1946 and succeeding years up> to the filing of the present action.
In 1935 S. D. Leighton and his wife conveyed an undivided 3/?th mineral interest to each of the following persons — W. F. Vycital, Carl O. Durr and D. O. Durr, Although taxes were levied against their respective interests commencing in 1946, neither Vycital nor Carl O. Durr paid taxes thereon. In 1953 a tax foreclosure action was filed in the district court of Lane County against the claimed interests of Vycital and Carl O. Durr and a judgment was rendered on the unpaid taxes thereon for the years 1946 up to and including 1953. The Vycital and Carl O. Durr interests were described in the tax foreclosure action as each having an undivided Vuth mineral interest. The action culminated in a sheriff’s sale on December 28, 1953, at which time the claimed interests of Vycital and Carl O. Durr were purchased by Warren Munsell, appellant herein. The sheriff’s deed issued to Munsell was recorded on March 2, 1954.
As we have indicated, only Munsell and Leighton-Carroll answered in the court below. After a pretrial conference the ease was presented to the trial court in a manner described by the court as follows:
“The case was presented to the Court on evidence to which the parties stipulated as being admissible. Counsel also considered it relevant and material. It was also agreed at pre-trial by the Counsel that the Court should decide this case on this documentary evidnce and the briefs and arguments which were filed with the Court. Counsel for tire defendants agreed that the defendants would rely solely upon the record tide of the property; that there was no parol testimony of importance known to them that should be considered by the Court. The plaintiffs, in addition to the record, have asked the Court to consider the fact that the plaintiffs did not have actual knowledge of the record until the latter part of 1968; and that within a short time thereafter, in early 1969, caused this action to be filed.”
On appeal defendants counsel takes issue with the trial court’s description of the presentation of the case concerning what was stipulated at the pretrial conference to which the court referred. We are informed that the court reporter was present and recorded the proceedings of the pretrial conference. However, defendants did not request a transcript and no record thereof has been reproduced on appeal. It is incumbent upon defendants-appellants to include in the record on appeal any matter upon which they intend to base a claim (Noll v. Schnebly, 196 Kan. 485, 413 P. 2d 78). Under the circumstances we were compelled to to consider the presentation of the case below as described by the trial court.
The trial court made extensive findings of fact, twenty in all, and comprehensive conclusions of law resolving all of the issues raised. Essentially, defendants attempted to defeat plaintiffs’ action to quiet title by claiming application of the doctrines of adverse possession and/or laches. The trial court concluded that neither of the defenses, even if they were applicable, were established by a preponderance of the evidence showing the elements required to establish adverse possession and/or laches. The trial court further concluded that because of the failure of the grantees to record the mineral conveyance or list it for taxation in accordance with K. S. A. 79-420, the grantor was not disseised and actually retained possession and ownership because of the failure of the conveyance.
With respect to Munsell’s claim, the trial court found that Vycital and Durr, Munsell’s predecessors in title, abandoned their interests and left a situation where Munsell had no predecessors in title to which he could “tack” in order to claim by adverse possession even if the doctrine applied to die case; and that Munsell was fully barred not only because of the fact that Lane County had nothing to sell him, by reason of the void conveyance in the first instance, but is further barred because the records disclose that he did not have a sheriff's deed until February 4, 1954, and did not record it until March 2, 1954; and since the petition in this case was filed January 20, 1969, it was established that Munsell held a sheriffs deed less than the fifteen years required by the statute pertaining to adverse possession. (K. S. A. 60-503.) The court entered Judgment, barring the claims of all defendants, and quieting title in the plaintiffs. Thereafter, defendants, Munsell and Leighton-Carroll, perfected this appeal.
Appellants specify numerous points of error. However, we believe the controlling issue concerns the application of K. S. A. 79-420 to the facts of this case.
This statute was originally enacted in 1897 (laws of 1897, chapter 244), was reenacted in 1911 (laws of 1911, chapter 316, section 20), and appeared as R. S. 79-420, and now appears as K. S. A. 79-420. The validity of the statute was assailed in Mining Co. v. Crawford County, 71 Kan. 276, 80 Pac. 601, and later in Gas Co. v. Oil Co., 83 Kan. 136, 109 Pac. 1002. In both cases this court upheld the constitutionality of the statute.
K. S. A. 79-420 has not been changed in substance since the original enactment in 1897. It reads:
“Surface and mineral rights taxed separately, when; duties of register of deeds and county assessor. Where the fee to the surface of any tract, parcel or lot of land is in any person or persons, natural or artificial, and the right or title to any minerals therein is in another or in others, the right to such minerals shall be valued and listed separately from the fee of said land, in separate entries and descriptions, and such land itself and said right to the minerals therein shall be separately taxed to the owners thereof respectively. The register of deeds shall furnish to the county assessor, who shall furnish on the first day of January each year to each deputy assessor where such mineral reserves exist and are a matter of record, a certified description of all such reserves: Provided, That when such reserves or leases are not recorded within ninety (90) days after execution they shall become void if not listed for taxation.”
The constitutionality of the statute was again challenged in Shaffer v. Kansas Farmers Union Royalty Co., 146 Kan. 84, 69 P. 2d 4, wherein it was held:
“The statute is not invalid for any of the reasons urged against it. The word ‘void’ in the proviso of the statute is used in its primary sense of nullity.” (Syl. ¶ 3.)
In the opinion it was stated:
“. . . Obviously the statute had a public purpose in view, namely, the proper listing of property for taxation. Aside from the fact that the legislature used the word void,’ — presumably knowing its meaning, it is uniformly held that when a word is used in the statute having a public policy in view, which requires the strict interpretation of the word, it will be construed in its strict sense (67 C. J. 268) as meaning a nullity. So construed, it is readily comprehensible and made effective. To construe it as voidable only would open the door for many interpretations.” (p. 96.)
Eased on the premise that the statute has a public purpose and is a statement of public policy, the holding in Shaffer clearly indicates that failure to comply with at least one of the alternative requirements of 79-420 operates to make a mineral deed a nullity and void and forecloses a construction of voidable only. Following the decision in Shaffer, this court again considered the constitutionality and discussed the meaning and intent of the statute in Hushaw v. Kansas Farmers Union Royalty Co., 149 Kan. 64, 86 P. 2d 559, wherein it was stated:
“It is a matter of common knowledge that Kansas contains vast reservoirs of oil and gas. The value of these mineral deposits baffle computation. The purpose of the statute is to place these properties on the tax roll. The method selected by the legislature was to compel disclosure of the true ownership of such minerals as they are from time to time transferred. This end is effectually accomplished by the provision that the instrument of transfer shall be void, unless recorded within ninety days after execution, and if not listed for taxation. Manifestly this is not the forfeiture of a vested title, but a condition precedent to the vesting of title in the transferee. This was the construction of the statute as given in Gas Co. v. Oil Co. [83 Kan. 136, 109 Pac. 1002], supra, and we adhere to the view there expressed.” (p. 74.) (Emphasis supplied.)
At this point we pause to note, that in their brief on appeal, appellants argue that failure to comply with the requirements of the statute only made a mineral deed subject to forfeiture thus, necessitating affirmative action to work such forfeiture and that because appellees failed to institute an action until forty years after the conveyance, they are barred by laches and/or adverse possession. Appellants say that by reason of the lapse of forty years appellees claim became stale. The holding in Hushaw effectually disposes of this argument of appellants. Failure to comply with the statute renders the instrument void not on the theory of forfeiture of a vested title, but because a condition precedent to the vesting of title in the transferee had not been met. Applied to the facts of this case the holding in Shafer renders the mineral deed' conveying the interests in question from Henry Becker to S. D. Leighton a nullity and void, and it did not divest Henry Becker of title or possession since a condition precedent to the vesting of title in Leighton as transferee was not met. Thus, the position of appellees was that of owners in possession seeking to remove a cloud from their title by means of a quiet title action. In Harris v. Defenbaugh, 82 Kan. 765, 109 Pac. 681, it was held:
“Laches is ordinarily no defense in an action to quiet title or remove a cloud where the plaintiff is in possession.” (Syl. ¶ 4.)
It was further stated in the opinion:
“. . . Laches is never imputable to the owner of land for failure to begin an action to annul a tax deed where the tax-tide holder is not in adverse possession, (citing cases.)” (p. 771.)
Since there was no vesting of title in appellants, or their predecessors, or disseisin of Henry Becker because of the failure of the original conveyance, neither laches nor adverse possession is available to appellants as a defense to appellees’ quiet title action. In the case of Templing v. Bennett, 156 Kan. 68, 131 P. 2d 904, cited by appellants, the grantee of a mineral interest did not record his mineral deed, but he made a timely presentation of the instrument of conveyance to the county clerk with the request that it be listed for taxation. The county clerk declined to list it because at the time nonproductive oil and gas interest in land had no taxable value and the county had provided no record for listing such interests. The grantor’s quiet title action against grantee for failure to comply with 79-420 was denied on the theory that grantee had listed his property for taxation by giving the county clerk (ex officio assessor) a statement of his property. The facts of Templing are clearly distinguishable from those of Hunshaw and it was so stated in the opinion of the court.
Other cases cited by appellants do not deal with situations where parties and their predecessors were in possession, such as in this case or situations which involved bad faith, breach of trust and fraud such as in Knowles v. Williams, 58 Kan. 221, 48 Pac. 856.
The appellants claim acquiescence by appellees by reason of the fact that exceptions pertaining to the undivided M mineral interest in question were made by appellees in several oil and gas leases executed by them. The trial court found that such exceptions amounted to nothing more than further bolstering the proof that the appellees had no knowledge of the noncompliance by the predecessors of appellants with the statute prior to examination of appellees’ title by their attorney in 1968. Acquiescence arises where a person who knows tibat he is entitled to impeach a transaction but neglects to do so for such length of time that, under the circumstances of the case, the other party may fairly infer that he has abandoned his right. (Black’s Law Dictionary [Fourth Edition], Acquiescence, p. 40; Norfolk & W. R. Co. v. Perdue, 40 W. Va. 442, 21 S. E. 755; Andrew v. Rivers, 207 Iowa 343, 223 N. W. 102.) Since there was no knowledge on the part of appellees, acquiescence is not available to appellants as a defense.
Appellants complain that certain evidence was erroneously admitted at the pretrial conference. As we have previously noted, no transcript of the pretrial conference proceedings was made a part of the record on appeal. It is the appellants’ obligation to designate a record sufficient to present their points on appeal to this court. (Supreme Court Rule No. 6 [c], 209 Kan. xxii; and Noll v. Schnebly, 196 Kan. 485, 413 P. 2d 78.)
The trial court fully considered the issues raised by the parties below and carefully construed and correctly applied the provisions of 79-420 to the facts as found in accordance with applicable decisions of this court relating thereto.
The judgment is affirmed. | [
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The opinion of the court was delivered by
Foth, C.:
Appellant, plaintiff below, is a man of middle age who has been blind since the age of four. He brought this action against the state department of social welfare alleging a breach of an implied contract under which he claimed the department was obligated to assist him in a program of vocational rehabilitation and, more importantly, to assist him in finding suitable employment. His petition seeks damages for the alleged breach.
After securing plaintiff’s deposition and answers to interrogatories the department moved for summary judgment. The motion was sustained and this appeal followed.
The history of plaintiff’s relations with the department as well as the reasons for the trial court’s order were contained in a letter opinion:
“This is an action commenced by the plaintiff against the defendant alleging that the plaintiff is a legally blind person and is eligible for services available from the State Department of Social Welfare, Vocational Rehabilitation Division, Division of Services for the Blind. Plaintiff alleges that this action is commenced pursuant to K. S. A. 39-708 (k) which provides as follows: ‘All contracts shall be made in the name of “the state board of social welfare of Kansas,” and in such name the state board may sue and be sued on such contracts.’ Plaintiff alleges that the defendant by and through its agents and employees entered into a contract with the plaintiff to assist plaintiff in a program of vocational rehabilitation and had assisted the plaintiff in gaining employment as prescribed by the laws of the State of Kansas, and notwithstanding the fact the plaintiff was ready, willing and able to carry out his part of the contract, the defendant, by and through its State Director and other agents and employees has refused and neglected to allow plaintiff’s participation in any such program of vocational rehabilitation and assisting plaintiff in gaining employment, and for this wrongful action by the defendant, plaintiff prays for damages for breach of contract in the amount of $300,000, $85,000 of which the plaintiff seeks to recover as punitive damages.
“It is admitted that the plaintiff herein is basing his claim upon the theory of implied contract and that same was entered into in 1943 when the Vocational Rehabilitation Division first began to render services to this plaintiff. That from the period of 1942, when the State Department of Social Welfare placed this plaintiff in a position with Beech Aircraft, until 1951 plaintiff held various jobs, which included employment in the storeroom of the State Department of Social Welfare, which he held until 1947. From 1951 to 1961 the plaintiff was unemployed except for occasional legal work, and in 1963 the State Welfare Department found plaintiff employment in the Topeka Workshop for the Blind, which job he kept for a few weeks until he resigned. He has been unemployed since that time, except for managing his real estate interests.
“It is the judgment of this Court that, under the undisputed facts herein, the defendant’s motion for summary judgment should be sustained, in that in this Court’s judgment K. S. A. 1970 Supp. 39-708 (k) does not authorize suits on the theory of implied contracts for services which are outside the scope of K. S. A. 1970 Supp. 39-708. In this regard the Court cites the case of In re Estate of Kline, 175 Kan. 864, 267 P. 2d 519, wherein the Supreme Court stated ‘Power to create liability upon the state treasury must be derived from [the] statute. Although the precise question here presented is one of first impression in this state it frequently has been held under similar statutes that absent express statutory liability imposed on the state a patient in its hospital[s] cannot recover on the theory of an implied contract for services rendered.’ In that case the State Department of Social Welfare had filed suit against the estate of a deceased patient at Lamed State Hospital. In its answer, the defendant claimed an offset against the amount prayed for by the plaintiff for work performed by the decedent while a patient at the hospital. The trial court sustained plaintiff’s demurrer to that portion of answer and defendant appealed. The Supreme Court affirmed as above set forth.
“In Williams v. Board of County Commissioners, 192 Kan. 548 [389 P. 2d 795], the Supreme Court stated at page 551 ‘It has been held the consent of • a state to be sued, as expressed by an [act] of the legislature, should be strictly construed so as not to enlarge by judicial interpretation the privilege granted.’ The powers and duties of the State Board of Social Welfare are set forth in K. S. A. 39-708. The Court will not quote said statute in detail, suffice is to say that I find no powers and duties of the State Department of Social Welfare which could be made the basis for such an implied contract. On the contrary, whenever programs such as the one herein involved are established, to say that a person coming under their provisions who becomes dissatisfied with the services, even though eligible, can maintain a suit against the state without express provisions therefore by the legislature, would open a Pandora’s box of litigation unparallel even in these changing times.
“Therefore, this Court is sustaining defendant’s motion for summary judgment and is dismissing plaintiff’s case herein. The Court is directing this judgment be spread of record as of this date and is taxing the costs to the plaintiff.”
The plaintiff’s argument that the district court was wrong has two steps. First, he says the statutory authorization for the department to be sued on its contracts, found in K. S. A. 1972 Supp. 39-708 (k), is broad enough to cover implied contracts. Second, he asserts that his relationship to the department, as one of its “clients” to whom it must by law provide benefits, is contractual in nature.
With plaintifFs first argument we might agee, as a general proposition. The cases he cites are those which hold that a governmental agency taking private property for public use has an obligation to pay for it, and this obligation is in the nature of an implied contract. E. g., Lux v. City of Topeka, 204 Kan. 179, 460 P. 2d 541; Brock v. State Highway Commission, 195 Kan. 361, 404 P. 2d 934. This is the proposition on which our inverse condemnation cases are bottomed. Suffice it to say, the department has not appropriated any of plaintiff’s property, so that the type of implied contract which is based on appropriation does not exist in this case.
Which brings us to his argument that some other type of contract does exist — not express, mind you, yet not quite the conventional “implied” contract referred to above. He cites no cases to support his theory. Rather, he points to Rousseau’s philosophical concept of “The Social Contract,” which envisions mutual compacts, not only among the members of society, one with another, but between the members and their government. We are not disposed to quarrel with this concept as a philosophical proposition. Plaintiff, however, would have us promote a tacit agreement to abide by society’s rules into an enforceable, multilateral contract, for any breach of which an injured party may recover damages. This we are not prepared to do on the meager showing made here of either the existence of such contract or of any substantial recognition of its enforceability in the manner suggested by plaintiff.
Our analysis convinces us that contract law has no applicability to this case. The cases cited by the trial court are persuasive, as are its observations on the relevant statutory and policy considerations. The remedy for persons deprived by government officials of their rights under statutes designed for their benefit has always been thought to be the pursuit of any prescribed administrative remedy or, in the absence of an administrative remedy, a suit in equity to compel the performance of the officials’ duty. Thompson v. Amis, 208 Kan. 658, 493 P. 2d 1259, and cases cited therein. The social welfare act provides such an administrative remedy by way of a “fair hearing” by an appeals committee under K. S. A. 1972 Supp. 75-3306, coupled with appellate review by the courts under K. S. A. 60-2101. Powers v. State Department of Social Welfare, 208 Kan. 605, 493 P. 2d 590.
It follows that the trial court correctly entered summary judgment in favor of the defendant department, and its judgment is affirmed.
approved by the court.
Prager, J., not participating. | [
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Brazil, J.:
Mary Frasher, administrator of Steven G. Frasher’s estate, appeals the district court’s decision granting summary judgment to Life Investors Insurance Company of America. The trial court held that a Missouri statute barring suicide as a defense to paying life insurance benefits did not apply in this case and that there was no coverage under the terms of a policy issued by Life Investors. We reverse and remand.
On January 12, 1988, Steven G. Frasher made an installment purchase of a vehicle from John Wallace Dodge, Inc., (Dodge) a car dealer in Overland Park, Kansas. Dodge is a Delaware corporation authorized to do business in Kansas. Frasher was a resident of Missouri. He applied for- and received credit life insurance available under a group credit life policy issued to Dodge. Dodge acted as an agent for Life Investors pursuant to a contract between the two formed in 1982. The- master policy, delivered to Dodge in Kansas, allowed Dodge to solicit debtors to purchase the insurance and provided for a percentage commission to Dodge on each policy of insurance sold. Each debtor received a certificate of insurance that was first sent to Dodge by Life Investors and then mailed to the debtor by Dodge.
The coverage was decreasing term insurance amortized evenly over 60 months, the term of the installment purchase contract. Premiums were paid monthly by Frasher to Dodge, which then forwarded them to Life Investors. Dodge was the designated beneficiary of the policy.
Frasher died of an apparent self-inflicted gunshot wound. Dodge’s assignee of the installment purchase agreement, Chrysler Credit Corporation, repossessed and sold the vehicle. Policy proceeds, if owed, were to be paid to Frasher’s estate. However, Life Investors tendered only premiums paid, contending the following policy exclusion was applicable: “SUICIDE: If an Insured Obligor or spouse dies by self destruction within one year from the Effective Date of coverage, whether sane or insane and while the Certificate is in force, the death benefits payable hereunder shall be limited to the amount of the premium paid.”
Frasher’s estate brought this lawsuit, asserting Missouri law was applicable and precludes suicide as a policy defense. Appellant relies upon this statute:
“In all suits upon policies of insurance on life hereafter issued by any company doing business in this state, to a citizen of this state, it shall be no defense that the insured committed suicide, unless it shall be shown to the satisfaction of the court or jury trying the cause, that the insured contemplated suicide at the time he made his application for the policy, and any stipulation in the policy to the contrary shall be void.” Mo. Rev. Stat. § 376.620 (1986).
The trial court, in granting summary judgment for Life Investors determined that, absent a valid choice of law provision in the policy, Kansas law would govern as the place of the making of the contract. The court also found that, even assuming the choice of law provision in the policy pointed to Missouri law, the Missouri statute did not apply because the policy was not “ ‘issued ... to a Missouri resident.’ ”
There are general rules regarding the construction of insurance policies this court must follow. “The construction and effect of insurance contracts are questions of law to be determined by the court.” Farm Bureau Mut. Ins. Co. v. Horinek, 233 Kan. 175, 177, 660 P.2d 1374 (1983). The construction given the insurance policy should give effect to the parties’ intent. The test is what a reasonable person in the position of the insured would understand the policy to mean. 233 Kan. at 179-80.
For choice of law purposes where the issue is contract construction, Kansas applies the rule of lex loci contractus, i.e., the place of the making. Fagan v. John Hancock Mutual Life Insurance Company, 200 F. Supp. 142 (D. Kan. 1961). In group life policies, “[i]t is generally held that such contracts are made where the master policy and the individual certificate are delivered.” 200 F. Supp. at 143. In the instant case, the master policy was delivered to Dodge in Kansas; thereafter, the car agency delivered the individual certificate to Frasher. Whether Frasher’s certificate was mailed to him in Missouri or delivered to him at the car agency’s office in Kansas is not clear.
In Simms v. Metropolitan Life Ins. Co., 9 Kan. App. 2d 640, 644, 685 P.2d 321 (1984), the court held: “As a matter of conflict of laws doctrine we find the majority rule to be that the interpretation of a group insurance contract is governed by the law of the state where the master policy is delivered.” In the instant case, this would result in enforcement of the suicide clause within the policy. However, this issue is complicated by other provisions in the policy that suggest further consideration and analysis.
A relevant clause in the insuring agreement states: “CONFORMITY WITH STATE STATUTES: Any provision of this Policy which, on its Effective Date, is in conflict with the statutes of the state in which the Insured resides on such date is hereby amended to conform to the minimum requirements of such statutes.” The key language is “in which the Insured resides” because Frasher is a Missouri resident.
Terms of an insurance policy must be construed as a whole. Farm Bureau Mut. Ins. Co. v. Horinek, 233 Kan. at 180. A policy or clause is ambiguous if the words conveying meaning or intent are subject to two or more meanings. 233 Kan. at 180. Although it is possible to construe the term “insured” to mean Dodge, a more reasonable conclusion is that “insured” in the policy refers to the deceased debtor. “Insured” is defined as: “The person who obtains insurance on his property, or upon whose life an insurance is effected.” (Emphasis added.) Black’s Law Dictionary 946 (4th ed. rev. 1968).
On the face of the policy, Life Investors states that it insured the lives of “Obligors of the Creditor.” Under the terms of the policy, the creditor is the beneficiary under the policy. Upon the death of the “Insured Obligor,” the proceeds of the policy go to the creditor. To call Dodge the “insured” under this policy would not be consistent with all the references in the policy to the debtor as the insured. In various places, the policy speaks of the “Obligor or spouse insured hereunder.” Thus, in the policy and the individual certificate where the policy refers to the “insured,” it is reasonable to conclude it is referring to the deceased in the instant case. Therefore, the policy should be read to conform to the laws of the State of Missouri, since that is where the deceased “insured” resided.
Having determined Missouri law should apply, the question is whether Mo. Rev. Stat. § 376.620 (1986) allows Frasher’s estate to recover.' This would necessitate a finding that the policy of life insurance was issued to the deceased. This is the only contested portion of the statute. Life Investors argues the policy was issued to Dodge, which is a corporation doing business in Kansas. The Missouri statute would not apply in that case.
There are few cases addressing this particular issue and usually the cases involve group life insurance. Credit life insurance is somewhat different and has been defined as “insurance on the life of a debtor for the security of the creditor in connection with a credit transaction.” 1 Appleman, Insurance Law and Practice § 59 (1981). Although a master policy is issued to the lending organization and an individual certificate to the debtor, the rights of the certificate holder are seen as greater than in a regular group life policy because it generally cannot be terminated short of the specified maturity. This is usually the death of the debtor or repayment of the loan. 1 Appleman, Insurance Law and Practice § 59. One passage from Appleman is particularly instructive:
“When it comes to a construction of the several instruments involved in credit life insurance, it becomes important to recall the nature of such coverages. If the courts bear in mind that this [is] franchise insurance, and not group insurance except in the situation where the creditor purchases the coverage as to the obligations of its debtors upon a noncontributory basis, it should present little problem. When they persist in calling it group insurance, then it throws it into the area of confusion where many courts, particularly in older decisions rendered under employer group contracts, tend to let the master policy dominate while the bulk of more recent decisions consider the certificates to control.” 1 Appleman, Insurance Law and Practice § 59.75.
In Perkins v. Philadelphia Life Ins. Co., 755 F.2d 632 (8th Cir. 1985), the court had to decide whether the individual insured, a Kansas resident, was the person to whom the policy was issued under Mo. Rev. Stat. § 376.620 (1978). The life insurance was group term life, and the employer was a Missouri corporation. The employer paid the premiums and had the power to cancel the policy. The policy designated Perkins as the insured and owner of the policy. Perkins apparently committed suicide. In construing the Missouri statute, the court stated that the corporation was the insured to which the policy was issued and allowed recovery of the life insurance proceeds. 755 F.2d at 633. In so stating, the court determined the statute was “designed to protect the person who procures the insurance and not necessarily the insured.” 755 F.2d at 634. The court, however, states that the statute is open to different interpretations and “the ‘issued to’ language of § 376.620 refers to the person to whom the policy is sold.” 755 F.2d at 634.
Life Investors cites Perkins to argue that it is the residence of the holder of the group policy that determines the applicability of § 376.620. In Perkins, TEC, Inc., the holder of the group policy, was a Missouri corporation; whereas, in this case, Dodge, the holder of the group policy, is a Delaware corporation doing business in Kansas.
Before commenting on Perkins we must note that, in construing state statutes, we are not bound by federal interpretations. Brookover Feed Yards, Inc. v. Carlton, Commissioner, 213 Kan. 684, 689, 518 P.2d 470 (1974). However, in the absence of any Missouri decisions on this issue, the Perkins case is instructive.
Our reading of Perkins suggests the court concluded that the “issued to” language of § 376.620 refers to the person to whom the policy is sold and further concluded that it was necessary to determine the contractual relationship between TEC, Perkins, and Philadelphia Life. The court noted that, while Perkins was the owner and the insured of the policy, all other factors indicated the policy was sold to TEC. Philadelphia Life looked to TEC for payment, and payments were made by TEC. TEC retained the right to unilaterally cancel the policy, it was entitled to an income tax deduction for premium payments, and the plan was sold to TEC under 26 U.S.C. § 79 (1982), which provided favorable tax treatment to employers. This led the court to conclude that it was the intention of the parties to have TEC purchase the life insurance for the benefit of Perkins and that the policy was “issued to” TEC for purposes of § 376.620.
The facts in the instant case indicate that the policy was not sold to Dodge. Rather, Frasher purchased the credit life coverage from Life Investors through Dodge as Life Investors’ agent. Dodge received a commission for each policy sold. Dodge did not pay the premiums for the credit insurance, and debtors had a choice as to whether they would purchase the insurance.
Under the facts of this case, considering the nature of the contractual relationship between Frasher, Dodge, and Life Investors, we conclude that a policy of insurance was purchased by Frasher, a Missouri resident, from Dodge as agent for Life Investors, and that it was “issued to” Frasher for purposes of § 376.620. Therefore, pursuant to § 376.620, Frasher’s suicide does not preclude the payment of benefits under the terms of the policy.
In its petition, the Frasher estate also requested attorney fees (Count II) under K.S.A. 40-256. The trial court apparently granted Life Investors’ motion for summary judgment on Count II because it had granted judgment against the estate on Count I. In short, it appears to us that the trial court did not address the issue of attorney fees on the merits.
Reversed and remanded to the trial court to order payment under the terms of the policy and for further proceedings on the issue of attorney fees. | [
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Gernon, J.:
The State of Kansas appeals the dismissal of its habitual violator petition filed against James Hines.
The State filed a habitual violator petition alleging that Hines had five motor vehicle convictions in the last five years. Only three are required for habitual violator status.
Hines stipulated that he had three prior valid traffic convictions within the five-year period contemplated by K.S.A. 1988 Supp. 8-285, but stated that he was not represented by counsel nor did he waive counsel in two of the prior convictions. He also attempted to invoke the Fifth Amendment privilege against self-incrimination when called as a witness.
The trial court ruled that the petition was a quasi-criminal matter and that Fifth Amendment rights were applicable which prohibited the State from calling Hines as a witness. It therefore dismissed the petition. The State appealed. We reverse and remand and direct that the petition be reinstated.
Whether a habitual violator action is a civil or criminal proceeding was answered by the Kansas Supreme Court in State v. Boos, 232 Kan. 864, 659 P.2d 224, cert. denied 462 U.S. 1136 (1983). The court held that an action pursuant to K.S.A. 8-286 is a civil action and that the constitutional guarantees as applied in criminal proceedings are not applicable to the same extent in a civil case.
The Kansas Supreme Court in the Boos case concluded that the habitual violator statutes do not create a new crime, but merely provide for the determination of the status of an individual driver. That status, once determined, may result in the revocation of driving privileges. The determination of status does not create a new conviction nor are criminal sanctions imposed.
Applying Boos to this case, the lack of counsel is not a factor to consider in determining whether there are three convictions. On remand, the court need only determine that the convictions are enumerated as required by K.S.A. 1988 Supp. 8-285 and 286.
The other issue raised in this appeal is whether the Fifth Amendment privilege is available to Hines in this proceeding.
The object of the Fifth Amendment is to “insure that a person should not be compelled, when acting as a witness in any investigation, to give testimony which might tend to show that he himself had committed a crime.” Lefkowitz v. Turley, 414 U.S. 70, 77, 38 L. Ed. 2d 274, 94 S. Ct. 316 (1973).
There have not been any habitual violator cases in Kansas addressing the Fifth Amendment privilege against self-incrimination. Looking to other jurisdictions which have addressed the Fifth Amendment issue, including Indiana and Louisiana, the results seem to be consistent, extending the holding in Boos to this issue.
For example, in Hardin v. State, 176 Ind. App. 514, 517-18, 376 N.E.2d 518 (1978), the court stated:
“The strict rules of law which prevent the State from calling a criminal defendant as a witness or from even making reference to his failure to testify are not applicable in this case, for the Habitual Traffic Offenders Act involves a civil rather than a criminal action. A respondent in such a proceeding is subject to neither a fine nor imprisonment, and the proceeding is merely an exercise of the State’s police powers in deciding who is and who is not qualified to operate a motor vehicle on a public street or highway:
“ ‘The purpose of the law is to classify those who — in the interest of the public safety and health — should be prohibited from using the highways .... The operation of this statute, which results in the deprivation of the license to drive, is not a punishment as a result of a criminal proceeding, but is rather an exercise of the police power for the protection of the public. The appellee is not receiving increased punishment for the previous convictions, but is automatically falling into a class of persons prohibited from driving on the public highways for the protection of the remaining public using the highways. [Citation omitted.]’ ”
The Kansas Habitual Offenders Act, K.S.A. 8-284 et seq., has a purpose similar to the Indiana act. The purpose is to provide for the maximum safety of everyone traveling on the highway; to deny operating privileges to those whose conduct, attitude, and record demonstrate an indifference to others’ safety and welfare; to discourage repetition of criminal acts; and to deprive violators of the privilege of operating a motor vehicle. This policy is a permissible exercise of the State’s police power.
The habitual violator statute does not create a crime. Any information relating to prior convictions obtained would not be incriminating because K.S.A. 60-424 defines incrimination as information which forms an essential part or a reasonable inference that a law has been violated which will subject the individual to punishment unless immunity is provided.
Thus, it logically follows that any information relating to prior convictions provided by a habitual violator will not subject that violator to further punishment. The violator has already been punished for the motor vehicle offenses committed. The State is simply exercising its privilege to remove a dangerous motorist from the highways for the protection of all motorists.
A hearing on this matter is a civil proceeding and, therefore, the Fifth Amendment considerations will not prevent the defendant from testifying as he is not subject to further punishment from any disclosure he might make at the habitual violator hearing.
This matter is reversed and remanded to the trial court with directions that the petition be reinstated and the defendant be required to answer questions of the State.
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Rees, J.:
This is a direct appeal by defendant Michael Roberts from his jury convictions for sale of heroin (K.S.A. 65-4127a; K.S.A. 65-4101[p][l]) and sale of cocaine (K.S.A. 65-4127a; K.S.A. 65-4101[p][4]).
The primary question raised for our resolution is whether the trial court erred in refusing to exclude the testimony of John Wimbish, the State’s principal witness.
Wimbish was an investigator assigned to the U.S. Army Criminal Investigation Division (CID) unit stationed at Fort Riley. Acting as an undercover agent, Wimbish made off-installation buys of narcotic drugs from defendant Michael Roberts, a civilian, on December 11, 1986, and December 12, 1986. The first buy was of heroin; the second was of cocaine. The two buys gave rise to the initiation of this prosecution by the filing of a two-count complaint/information on May 29, 1987. Roberts was arrested on March 14, 1988. He was tried on November 18, 1988.
In the record, Wimbish is identified as a semi-covert “drug suppression team” (DST) member. Whether all DST members were CID personnel or whether the DST also included Junction City Police Department (JCPD) personnel is not clear. However, the record does disclose that Wimbish’s two buys took place under back-up visual surveillance conducted by CID personnel and a JCPD officer. After completing each buy, Wimbish orally reported what had transpired to the JCPD officer at the Junction City police station. Wimbish then field tested the purchased substances at his office on Fort Riley, found they tested positive, and, on December 12 and 16, gave the purchased substances and the field test results to the JCPD officer.
Neither Wimbish nor other CID personnel directly or indirectly participated in the making of an arrest, or in the conduct of a stop and frisk, or in the execution of a search or seizure. Neither Wimbish nor other CID personnel had any direct or indirect contact or involvement with Roberts other than the making of the buys and the conduct of the surveillance.
Wimbish’s superior’s CID investigation report states: “This investigation was conducted as a joint investigation with . . . JCPD. Coordination was made on a routine basis with [JCPD].” According to that same report, the CID activity was triggered by a December 11 report to the CID by one of its confidential informants that “he had purchased drugs from Michael Roberts in the past.” Somewhat in contrast, when the JCPD officer was asked at trial whether he asked the CID “to assist you in making these drug buys,” he answered, “Yes.” This is the sole record evidence concerning the subjects of who asked whom for assistance and the relationship of the CID and JCPD personnel when acting in this matter.
Roberts complains that the exclusionary rule, applied to unlawful search and seizure evidence to assure an individual’s personal Fourth Amendment rights, should have been invoked here so as to exclude Wimbish’s testimony.
The foundation of Roberts’ argument is the federal Posse Comitatus Act (PCA) (18 U.S.C. § 1385 [1982]). It reads:
“Whoever, except in cases and under circumstances expressly authorized by the Constitution or Act of Congress, willfully uses any part of the Army ... as a posse comitatus or otherwise to execute the laws shall be fined not more than $10,000 or imprisoned not more than two years, or both.” (Emphasis added.)
By its language, the PCA is a penal statute; it effectively proscribes certain conduct; it fixes a penalty for its violation. The trial court ruled that the PCA was not violated in the present case.
Not mentioned by the parties is 10 U.S.C. § 375 (1982), a corollary to the PCA (State v. Short, 113 Wash. 2d 35, 775 P.2d 458 [1989]), which, as in effect on December-11 and 12, 1986, provided:
“The Secretary of Defense shall issue such regulations as may be necessary to insure that the provision of any assistance (including the provision of any equipment or facility or the assignment of any personnel) to any civilian law enforcement official under this chapter [10 U.S.C. § 371 et seq. (1982)] does not include or permit direct participation by a member of the Army ... in ... a search and seizure, arrest, or other similar activity unless participation in such activity by such member is otherwise authorized by law.”
It seems that the Secretary of Defense complied with the direction of 10 U.S.C. § 375 by the issuance of the regulations found at 32 C.F.R. § 213.1 et seq. (1988). Presently pertinent are these provisions of those regulations:
“§ 213.1 Purpose. This part [32 C.F.R., ch. 1, part 213] establishes uniform DOD [Department of Defense] policies and procedures to be followed with respect to support provided to Federal, State, and local civilian law enforcement efforts.”
“§ 213.4 Policy. It is the policy of the Department of Defense to cooperate with civilian law enforcement officials to the maximum extent practicable. Under §§ 213.8 through 213.11, the implementation of this policy is consistent with the needs of national security and military preparedness, the historic tradition of limiting direct military involvement in civilian law enforcement activities, and the requirements of applicable law.”
Ҥ 213.10 Restrictions on participation of DOD personnel in civilian law enforcement activities, (a) Statutory requirements. (1) The primary restriction on military participation in civilian law enforcement activities is the Posse Comitatus Act (18 U.S.C. 1385) ....
“(3) Restrictions on direct assistance. Except as otherwise provided in this enclosure, the prohibition on use of military personnel ‘as a posse comitatus or otherwise to execute the laws’ prohibits the following forms of direct assistance:
“(ii) A search or seizure.
“(iii) An arrest, stop and frisk, or similar activity.
“(iv) Use of military personnel for surveillance or pursuit of individuals, or as informants, undercover agents, investigators, or interrogators.
“(7) Other permissible assistance. The following forms of indirect assistance activities are not restricted by the Posse Comitatus Act . . .:
“(ii) . . . [A]ctions, approved in accordance with procedures established by the head of the DOD Component concerned, that do not subject civilians to the exercise of military power that is regulatory, proscriptive, or compulsory in nature.”
We are satisfied that the activity of military personnel addressed by the PCA and the DOD regulations is the subjection of civilians to the unauthorized assertion of military power or authority that is regulatory, proscriptive, or compulsory in nature. See 32 C.F.R. § 213.10(a)(7); State v. Short, 113 Wash. 2d 35. A power regulatory in nature is one which controls or directs. A power proscriptive in nature is one that prohibits or condemns. A power compulsory in nature is one that exerts some coercive force. United States v. Yunis, 681 F. Supp. 891, 895-96 (D.D.C. 1988). (Although our resolution of this appeal is on another ground, we comment that, in our opinion, there was no violation of the PCA for the reason that none of the activities of Wimbish and the other CID personnel constituted the exercise of regulatory, proscriptive, or compulsory military power.) The DOD regulations in effect in December 1986 used specific language in directing that, unless authorized, direct assistance to civilian law enforcement agencies and officials in the form of use of military personnel for (1) search or seizure; (2) an arrest, stop and frisk, or similar activity; or (3) surveillance or pursuit of individuals, or as informants, undercover agents, investigators, or interrogators, was not to be undertaken. 32 C.F.R. § 213.10(a)(3). Also, see 10 U.S.C. § 375.
The DOD regulations are in the nature of policy statements. 32 C.F.R. § 213.1. They fix no penalty for violation. They enunciate self-imposed restrictions upon the activities of DOD per sonnel. They do not spawn a personal right as does the Fourth Amendment.
Missing from the record made in this case and the appellate briefs is any exposition of the existence or nonexistence of authority for the “joint investigation” and “coordination on a routine basis” referred to in the written CID report. Neither is there any exposition of the existence or nonexistence of “circumstances expressly authorized by . . . Act of Congress” (18 U.S.C. § 1385), or approval of actions in accordance with procedures established by the head of a concerned DOD component.
We are aware of only one Kansas case that concerns the PCA. It is State v. Danko, 219 Kan. 490, 548 P.2d 819 (1976). There, the Supreme Court reversed a trial court suppression order. As a practical matter, Danko is the case authority upon which Roberts now relies.
We need not describe at length the factual dissimilarity of Danko and the case before us. It is sufficient to observe that, in Danko, a Fort Riley military police sergeant, while on “joint patrol” with JCPD officers “under an arrangement between military authorities and Junction City police officials,” conducted a warrantless search of a part of the interior of a stopped vehicle. The vehicle, a suspected armed robbery “get away” vehicle, was occupied by two men who it seems were civilians. The MP’s search was conducted at the request of one of the JCPD officers, John Hill. The MP seized a pistol he found under the passenger seat. It was later identified as the robbery weapon.
In the Danko appeal, the State maintained that the conduct of Hill and the MP did not constitute a violation of the PCA and that the trial court erred in excluding the evidence. After holding that the State’s contention that there was no violation of the PCA could not be upheld, the Supreme Court said:
“[I]n our consideration of the State’s appeal, we shall treat the conduct of Hill and [the MP] as constituting a technical violation of the [PCA] although neither has been charged nor convicted. This does not, however, dispose of the question presented on appeal. We cannot agree with defendants that a technical violation of the [PCA] under the circumstances shown to exist warrants the suppression ,of the evidence seized . . . .” 219 Kan. at 493. “United States v. Walden (4th Cir. 1974), 490 F.2d 372, cert. den. 416 U.S. 983, 40 L. Ed. 2d 760, 94 S. Ct. 2385, reh. den. 417 U.S. 977, 41 L. Ed. 2d 1148, 94 S. Ct. 3187, is one of the few reported cases dealing directly with the exclusion of evidence in a posse comitatus situation and we find the rationale therein persuasive.” 219 Kan. at 495.
“The [Walden] court reasoned that the Navy regulation . . . should be given the same legal effect as the Posse Comitatus Act.” 219 Kan. at 496.
“We agree with the view of the Walden court that the [PCA] expresses a policy that is for the benefit of the people as a whole, rather than a policy which could be characterized as designed to protect the personal rights of individual citizens as declared in the Fourth Amendment. The absence of cases involving a posse comitatus situation, such as at bar, considered in the light of the longtime presence of military establishments in this state, leads us to the position adopted by the Walden court that application of the extraordinary remedy of exclusion is unnecessary as an added deterrent to the serious criminal sanctions provided in the [PCA].” 219 Kan. at 497-98. (Emphasis added.)
“The Walden court . . . declined to impose the extraordinary remedy of an exclusionary rule. The court warned, however, that,
\ . . Should there be evidence of widespread or repeated violations in any future case, or ineffectiveness of enforcement by the military, we will consider ourselves free to consider whether adoption of an exclusionary rule is required as a future deterrent.’ (p. 377.)” 219 Kan. at 496.
To our knowledge, the present case is only the second case to come before any court of this state involving actual or possible violation of the PCA or related regulations issued by the DOD or a branch of our Armed Forces. It involves activity of military personnel that took place more than ten years after Danko was filed. Nonetheless, Roberts argues that, because of Danko’s approval of the Walden reservation of the freedom to give future consideration to possible imposition of the exclusionary rule in cases of violation of the PCA or related regulations, that extraordinary remedy should be imposed in this case. We disagree.
We are not persuaded that, even if a PCA violation had occurred in this case, this single instance evidences widespread and repeated PCA violations or ineffectiveness of military enforcement of the PCA of a magnitude that requires as a matter of law that we find that the trial court erroneously failed to exclude Wimbish’s testimony. Further, inasmuch as the PCA incorporates the enforcement tool of fine, imprisonment, or both, we cannot accept the proposition that the additional extraordinary remedy of exclusion is now called for.
In our examination of case decisions from other jurisdictions involving the question of exclusion of evidence because of PCA violation, Taylor v. State, 645 P.2d 522, 525 (Okla. Crim. 1982), is the only case found where exclusion was approved. That, in our view, does not constitute a compelling body of authority. Cases disclosing rejection or disapproval of imposition of the exclusionary rule include: United States v. Hartley, 796 F.2d 112, 115 (5th Cir. 1986), and State v. Short, 113 Wash. 2d at 40 (both finding no violation of PCA and also that in any event exclusion is inappropriate); United States v. Roberts, 779 F.2d 565 (9th Cir. 1986) (finding no violation of PCA but a violation of 10 U. S. C. §§ 371 et seq., and holding exclusionary rule inapplicable by analogy to PCA).
In Hartley, it is said that, “where a violation of the [PCA] is found or suspected, courts have generally found that creation or application of an exclusionary rule is not warranted.” 796 F.2d at 115. And, in People v. Hayes, 144 Ill. App. 3d 696, 700, 494 N.E.2d 1238 (1986), it is said, “with few exceptions, the courts have uniformly held that the exclusionary rule does not apply to evidence seized in violation of the [PCA].”
In Roberts, it is said that “courts have uniformly refused to apply the exclusionary rule to evidence seized in violation of the [PCA].” 779 F.2d at 568. In the same opinion, it is said that United States v. Walden, 490 F.2d 372, 377, (4th Cir.), cert. denied 416 U.S. 983 (1974), is in accord with United States v. Wolffs, 594 F.2d 77, 85 (5th Cir. 1979), where it was “held that the extraordinary remedy of exclusion was inappropriate until such time as widespread and repeated violations’ of the [PCA] demonstrated the need for such a remedy.” 779 F.2d at 568.
Particularly applicable here, as we see it, is this Walden language as adapted to the case before us:
“In the appeals at bar, the evidence of defendant’s guilt is overwhelming. While the bulk of the evidence was obtained by violating the [regulations], there is totally lacking any evidence that there was a conscious, deliberate or willful intent on the part of [Wimbish or the JCPD officer] to violate the [regulations] or the spirit of the [PCA]. From all that appears, [Wimbish and the JCPD officer] acted innocently albeit ill-advisedly. The [regulations provide] no mechanism for [their] enforcement and the Act, where it is applicable, renders the transgressor liable to criminal penalties but does not provide that ‘[t]he criminal is to go free because the constable has blundered.’ People v. Defore, 242 N.Y. 13, 21, 150 N.E. 585, 587 (1926) (Cardozo, J.).” 490 F.2d at 376.
As his other issue, Roberts points us to State v. Warren, 230 Kan. 385, 635 P.2d 1236 (1981), and complains that the trial court erred in failing to give a cautionary eyewitness identification instruction. We will not address this complaint because the record on appeal does not establish that the issue was raised in the trial court and preserved for appellate review. An issue not raised before or presented- to the trial court cannot be raised for the first time on appeal. Kansas Dept. of Revenue v. Coca Cola Co., 240 Kan. 548, 552, 731 P.2d 273 (1987); Eisenhut v. Steadman, 13 Kan. App. 2d 220, 223, 767 P.2d 293 (1989).
The record on appeal does not include the trial court’s instructions (filed November 18, 1988), any written requested instructions, or any record of objections to instructions given or to failure to give requested instructions. A party must designate an adequate record on appeal, to substantiate contentions made to the appellate court. Without such a record, claims of alleged error must fail. Eisenhut, 13 Kan. App. 2d at 223.
Further, subject to certain exceptions, one of which is clear error, entitlement to appellate review of trial court failure to give a requested instruction, whether the case be criminal or civil, necessitates the showing that the requested instruction was submitted in writing, that there was objection to the failure to give the instruction, and that the objection distinctly stated the ground or grounds for the objection. In addition to the plain statutory language of K.S.A. 22-3414(3) and K.S.A. 60-251, see, for example, State v. Wilson, 221 Kan. 92, 96, 558 P.2d 141 (1976); State v. Boone, 220 Kan. 758, 770, 556 P.2d- 864 (1976); State v. Nesmith, 220 Kan. 146, 150, 551 P.2d 896 (1976); and State v. Johnson, 219 Kan. 847, 851, 549 P.2d 1370 (1976).
Roberts seeks to “cure” the record deficiency by arguing that the trial court’s failure to give a Warren instruction as found at PIK Crim. 2d 52.20 constituted clear error. We are not persuaded.
The failure to give an instruction is clearly erroneous only if the reviewing court reaches a firm conviction that, if the trial error had not occurred, there was a real possibility the jury, would have returned a different verdict. State v. DeMoss, 244 Kan, 387, 391-92, 770 P.2d 441 (1989). Under the facts of this case, we do not have that firm conviction.
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Davis, J.:
This is a declaratory judgment action brought by Farmers Insurance Company, Inc., to determine whether Stephen Gilbert, its insured, is entitled to underinsured motorist benefits for injuries he received while riding his motorcycle. Gilbert contends that he is entitled to benefits under the uninsured motorist coverage provided by his automobile liability policies. Farmers contends that Gilbert’s motorcycle policy is the only applicable policy and that no benefits are due thereunder. The trial court granted summary judgment for Farmers. Gilbert appeals. We reverse.
The parties submitted the issue on stipulated facts. Stephen Gilbert was injured when his motorcycle was struck by an automobile driven by Debra Onofrio. Onofrio’s negligence was the sole cause of the collision, and Farmers Insurance Company, which was also her liability insurer, paid Gilbert $25,000, representing the limits of her policy. Gilbert’s actual damages and expenses, however, were in excess of $50,000.
Gilbert was insured by Farmers under separate liability policies for his motorcycle, his van, and his automobile. The liability limits on the policies for the van and automobile were $50,000. The liability limit on the motorcycle policy, however, was only $25,000. Each policy also provided coverage against losses caused by uninsured or underinsured motorists. The exact language of the “underinsured motorist protection” will be quoted later. For now, it may be summarized as follows: If Gilbert were to be injured by a motorist whose liability limits were less than his own, Farmers would provide coverage for that portion of his loss falling between his own liability limits and the liability limits of the other motorist.
The issue is whether Gilbert may recover underinsured motorist benefits under either of his two automobile policies. If either of his two automobile policies applies, he is entitled to $25,000 in underinsured motorist benefits. If, however, his motorcycle policy is the only policy that applies, Gilbert is not entitled to any underinsured motorist benefits.
Because the facts were submitted by stipulation, and because the construction of a written instrument is a question of law, our standard of review is de novo. American States Ins. Co. v. Hart ford Accident & Indemnity Co., 218 Kan. 563, Syl. ¶ 4, 545 P.2d 399 (1976); Kansas Gas & Electric Co. v. Kansas Power & Light Co., 12 Kan. App. 2d 546, 551, 751 P.2d 146, rev. denied 243 Kan. 779 (1988).
Before taking up the issue raised by this appeal, a brief review of uninsured and underinsured motorist coverage in Kansas would be helpful.
As the automobile grew in popularity, a significant problem developed as motorists without insurance caused injuries for which they could not provide compensation. The Kansas Legislature responded to this problem in 1968 by requiring insurers to offer uninsured motorist coverage to all persons purchasing automobile liability policies. Under this coverage, an insured motorist who was injured by an uninsured motorist could collect the amount of damages to which he was entitled from his own insurer up to his policy limits. L. 1968, ch. 273, § 1 (codified as K.S.A. 40-284 [Weeks]); see Widiss, Uninsured Motorist Coverage, 40 J.K.B.A. 199 (1971). See generally 1 Widiss, Uninsured and Underinsured Motorist Insurance § 1.1 et seq. (2d ed. 1990).
The Supreme Court recognized the remedial purpose of this statute, and construed it liberally to provide coverage, holding:
“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.” Winner v. Ratzlaff, 211 Kan. 59, 63-64, 505 P.2d 606 (1973).
See Forrester v. State Farm Mutual Automobile Ins. Co., 213 Kan. 442, Syl. ¶¶ 1-3, 517 P.2d 173 (1973); Stewart v. Capps, 14 Kan. App. 2d 356, Syl. ¶ 1, 789 P.2d 563 (1990).
Despite the legislature’s action and the liberal construction followed by the courts, two problems remained. First, a motorist could reject uninsured motorist coverage and be left without compensation if he were injured by an uninsured motorist. Second, a motorist with a high level of coverage could be injured by a motorist insured only to the legal minimum. If the damages to the injured motorist exceeded the legal minimum, the injured motorist would be unable to collect, either from the other motorist or from his own insurer. In such a case, the injured motorist would have been better off if the other motorist had been entirely uninsured so that he would be able to collect under his own uninsured motorist coverage. See 2 Widiss, Uninsured and Underinsured Motorist Coverage § 31.1 et seq. (2d ed. 1990).
The legislature dealt with both of these problems in 1981, when it amended K.S.A. 40-284 for the first time. Uninsured motorist coverage became mandatory, although coverage above the statutory minimum for liability coverage could still be rejected. Uninsured motorist coverage was also required to contain “underinsured” motorist coverage. Under this new coverage, if the other motorist had liability insurance but the limits of liability were less than the insured’s damages and less than the insured’s uninsured motorist coverage, the insured could recover his excess damages from his own insurer up to his policy limits. L. 1981, ch. 191, § 1; Jerry, New Developments in Kansas Insurance Law, 37 Kan. L. Rev. 841, 878 (1989); Jerry, Recent Developments in Kansas Insurance Law: A Survey, Some Analysis, and Some Suggestions, 32 Kan. L. Rev. 287, 343-44 (1984).
Although the 1981 amendments generally broadened coverage, the legislature also authorized several new exclusions and limitations. L. 1981, ch. 191, § 1. Many of these exclusions were in apparent response to decisions finding coverage and had the effect of overruling those decisions, at least in part. See Jerry, 32 Kan. L. Rev. at 343-44. Two of these new exclusions or limitations are applicable to this case and will be discussed in detail later in our opinion.
The statute has since been amended in 1984, 1986, and 1988. None of these amendments is material here.
COVERAGE
Gilbert argues that underinsured motorist coverage is “portable” in nature, not limited to the vehicle for which the underlying liability policy is purchased; it applies to an insured wherever he may be. Farmers argues that the automobile policies do not provide underinsured motorist coverage when the insured is operating a motorcycle; that coverage under his van or auto policy is excluded when the insured is occupying an owned vehicle not insured under those policies.
Farmers argues that the underinsured motorist coverage in the two automobile policies does not protect Gilbert while he is riding his motorcycle because a motorcycle is not a car. The express provisions of the two automobile policies undermine Farmers’ argument. Coverage exists, subject to applicable exclusions and limitations, under the unambiguous terms of the policies. Farmers’ argument to the contrary ignores the plain language of the coverage provisions and confuses underinsured motorist coverage with liability coverage.
The terms of the coverage provision are specified by statute. At the time Gilbert’s policies were issued and at the time of Gilbert’s accident, the statute read as follows:
“(a) 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 . . . unless the policy contains or has endorsed thereon, a provision with coverage limits equal to the limits of liability coverage for bodily injury or death in such automobile liability policy sold to the named insured for payment of part or all sums which the insured or the insured’s legal representative shall be legally entitled to recover as damages from the uninsured owner or operator of a motor vehicle because of bodily injury, sickness or disease, including death, resulting therefrom, sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such motor vehicle ....
“(b) 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 coveragé to the extent such coverage exceeds the limits of the bodily injury coverage carried by the owner or operator of the other motor vehicle.” K.S.A. 40-284.
The language of subsections (a) and (b) appears in the two automobile policies, which provide:
“PART II — UNINSURED MOTORIST
“Coverage C — Uninsured Motorist Coverage (Including Underinsured Motorists Protection)
“We will pay all sums which an insured person is legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle because of bodily injury sustained by the insured person. The bodily injury must be caused by accident and arise ■ out of the ownership, maintenance or use of the uninsured motor vehicle.”
We note in passing that this coverage provision is flawed because it speaks only of "uninsured motor vehicles," which are defined in the definition section to mean vehicles without insurance. Thus, the policy, when read literally, does not provide coverage for injuries caused by vehicles that are underinsured. However, Farmers obviously meant to include underinsured vehicles in the coverage provision, as indicated by the caption over the coverage provision and by the damages formula for under insured vehicles given later in this part of the policy. The parties also stipulated that the automobile policies did provide such benefits.
Immediately after the coverage provision, the two automobile policies contain an identical set of definitions. The definition that is material here is as follows:
“As used in this Part:
“1. Insured person means:
“a. You or a family member.”
The actual formula for determining the amount payable is found under the heading “Other Insurance”:
“1. Coverage for losses caused by an underinsured motor vehicle shall be limited to the difference between the underinsured motorists coverage limits provided in this part and the coverage limits provided in any applicable bodily injury liability bond or policy available to any party held liable for the accident.”
Gilbert is an “insured person,” and, subject to an exclusion or other applicable limitation, he is protected against bodily injury caused by an uninsured or underinsured motor vehicle. The coverage provision does not condition or limit its coverage depending on the vehicle Gilbert is occupying when he is injured. See Midwest Mutual Ins. Co. v. Farmers Ins. Co., 3 Kan. App. 2d 630, Syl. ¶ 3, 599 P.2d 1021, rev. denied 227 Kan. 927 (1979) (“Uninsured motorist coverage protects the named insured wherever he may be, whether in the described vehicle, another ‘owned’ vehicle, a non-owned vehicle, or»on foot.”). If coverage is to be limited because of the vehicle Gilbert is occupying, the limitation must come from an express limitation or exclusion authorized by the legislature and included in the two automobile policies.
Farmers’ argument that a motorcycle is not a four-wheeled vehicle covered under the auto policies is flawed because it begins with the premise that the scope of uninsured motorist coverage is identical to the scope of liability coverage. Uninsured motorist coverage is first-party insurance, designed to protect the insured; liability insurance is third-party insurance, designed to protect not the insured, but persons injured by the insured. See Jerry, Understanding Insurance Law § 13D[a] (1987). The Supreme Court recognizes this distinction:
“[T]he purpose of the uninsured motorist law is to recompense innocent persons who are damaged through the wrongful act of uninsured motorists who are not financially responsible. Uninsured motorist coverage is not actually liability insurance, but more closely resembles limited accident insurance. It insures against losses occasioned by a limited number of tortfeasors.” Forrester, 213 Kan. at 448.
It follows that uninsured motorist insurance will provide coverage in situations where liability insurance will not.
Farmers argues that coverage does not exist because “[a] motorcycle cannot be an insured car under” the automobile policies. This argument is correct only with respect to liability coverage. The automobile policies provide liability coverage for damages “arising out of the ownership, maintenance or use of a private passenger car, a utility car, or a utility trailer.” A “private passenger car” and a “utility car” are both defined to include vehicles with at least four wheels. Thus, if Gilbert caused an accident while riding his motorcycle, liability coverage under his automobile policies would not exist. Insofar as uninsured/underinsured motorist coverage is concerned, however, Farmers’ argument has no application. Subject to statutorily authorized limitations and exclusions, uninsured/underinsured motorist coverage applies no matter where the named insured is, or what vehicle the named insured is occupying, when the named insured is injured.
For this reason, Farmers’ reliance on Klamm v. Carter, 11 Kan. App. 2d 574, 730 P.2d 1099 (1986), is misplaced. Klamm was injured by an uninsured motorist while riding his uninsured motorcycle. Because of a statutorily authorized exclusion for injuries sustained by Klamm while occupying an uninsured motor vehicle owned by him, coverage did not exist. Klamm attempted to avoid the exclusion by arguing that his motorcycle was, in fact, insured under the policy because he had acquired his motorcycle the day before the accident and that, under the policy, a newly acquired “private passenger car or utility car” was included within the term “insured car” if Farmers was notified within 30 days of the new vehicle’s acquisition. We rejected this argument, holding that a motorcycle could not reasonably be viewed as an “insured car” since a “private passenger car” and a “utility car” were both defined as having “at least four wheels.” 11 Kan. App. 2d at 577. Although not expressly stated, it is obvious that Klamm was attempting to create liability coverage for his motorcycle in order to avoid the exclusion. Because Gilbert is not attempting to create liability coverage under his automobile policies for his motorcycle, which was insured under a separate policy, the relied-upon holding in Klamm does not apply to this case.
Farmers’ second argument is that coverage is excluded under the terms of the two automobile policies because Gilbert was riding a vehicle that was not insured under either policy. Gilbert asserts that the exclusion in the two automobile policies is broader than the exclusion authorized by statute and is therefore unenforceable. We agree.
In analyzing coverage under the policies, two limitations or exclusions of coverage authorized by the 1981 amendments are applicable. The first relates to “stacking.” The Supreme Court has defined “stacking” as follows:
“ ‘Stacking,’ in connection with uninsured motorist coverage, refers to the right to recover on two or more policies in an amount not to exceed the total of the limits of liability of all policies up to the full amount of the damages sustained.” Van Hoozer v. Farmers Insurance Exchange, 219 Kan. 595, 608, 549 P.2d 1354 (1976).
Prior to 1981, the Supreme Court had consistently allowed insureds to stack their uninsured motorists benefits. In 1981, however, the legislature enacted K.S.A. 40-284(d), which provides:
“(d) Coverage under the policy shall be limited to the extent that the total limits available cannot exceed the highest limits of any single applicable policy, regardless of the number of policies involved, persons covered, claims made, vehicles or premiums shown on the policy or premiums paid or vehicles involved in an accident.”
This subsection overruled at least six Supreme Court decisions holding that uninsured motorist benefits could be stacked. See Davis v. Hughes, 229 Kan. 91, 98, 622 P.2d 641 (1981); Welch v. Hartford Casualty Ins. Co., 221 Kan. 344, 348-50, 559 P.2d 362 (1977); Clayton v. Alliance Mutual Casualty Co., 212 Kan. 640, Syl. ¶ 2, 512 P.2d 507 (1973); Rosson v. Allied Mutual Ins. Co., 203 Kan. 795, 457 P.2d 42 (1969); and Sturdy v. Allied Mutual Ins. Co., 203 Kan. 783, 457 P.2d 34 (1969).
The motorcycle, van, and auto policies in this case contain an identical anti-stacking provision under the heading “other insurance”:
“4. If any applicable insurance other than this policy is issued to you by lis or any other member company of the Farmers Insurance Group of Companies, the total amount payable among all such policies shall not exceed the limits provided by the single policy with the highest limits of liability. ”
The stacking exclusion prevents Gilbert from recovering on more than one policy, but the language used does not prevent him from choosing the one policy with the highest limits and recovering on that one, single policy.
The second applicable limitation or exclusion authorized by the 1981 amendments is found in K.S.A. 1989 Supp. 40-284(e)(l):
“(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.” (Emphasis added.)
Prior to 1981, the appellate courts of this state held that uninsured motorist coverage protected the insured “wherever he may be, whether in the described vehicle, another ’owned’ vehicle, a non-owned vehicle, or on foot.” Midwest Mutual Ins. Co. v. Farmers Ins. Co., 3 Kan. App. 2d 630, Syl. ¶ 3.
This broad view of coverage could lead, however, to odd results in some situations. In Barnett v. Crosby, 5 Kan. App. 2d 98, 612 P.2d 1250, rev. denied 228 Kan. 806 (1980), for example, Barnett was injured by an uninsured motorist while riding his motorcycle. Barnett had rejected uninsured motorist coverage on his motorcycle policy; however, he did have uninsured motorist coverage under an automobile policy issued by a different company. The automobile insurer denied coverage based on an ex- elusion for “injuries arising as a result of occupying a vehicle (other than the insured vehicle) which is owned by the named insured.” 5 Kan. App. 2d at 98-99. We held that, since the statute requires protection of the insured wherever he may be, it was apparent that the “exclusion clause is an attempt to dilute this mandated coverage and consequently is void.” 5 Kan. App. 2d at 99.
Merritt & Fanners Insurance Co., 7 Kan. App. 2d 705, 647 P.2d 1355 (1982), which was decided under the pre-1981 law, is another example of an odd result. The plaintiff was a passenger in an automobile she owned but had not insured. The automobile was forced off the road by a hit-and-run driver and plaintiff sought to recover uninsured motorist benefits as an additional “insured” under the drivers policy. The trial court found that plaintiff was not an “innocent person” since she had violated the insurance statutes by failing to insure her automobile. We held that, even though the legislature probably did not intend to require coverage for persons in the plaintiffs position, plaintiff was an “insured” under the plain language of the policy and such a result was not contrary to public policy. 7 Kan. App. 2d at 711.
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 exclusion 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 had failed to insure their own vehicles from recovering on the policies of others or on policies of their own issued for other vehicles.
The narrow scope of the exclusion has led Dean Robert Jerry to the following conclusion:
“Plainly, it is no longer true that the uninsured motorist' coverage mandated by the statute protects the insured ‘wherever he may happen to be.’ However, earlier Kansas cases invalidating exclusions for injuries arising as a result of occupying a vehicle (other than the insured vehicle) owned by the named insured do not seem to be affected by the amendments to section 284, since the amendments only authorize an exclusion for occupying an uninsured automobile owned by the insured or provided for the insured’s use.” Jerry, 32 Kan. L. Rev. at 344.
We agree. Coverage may not be excluded for injuries arising out of the use of another owned vehicle unless the other owned vehicle is uninsured. See Klamm v. Carter, 11 Kan. App. 2d at 578 (the exclusions authorized by K.S.A. 40-284(e) “should be strictly construed against the insurer because the statute is remedial legislation and insurance policies are construed against the insurer”).
In this case, the motorcycle owned and operated by Gilbert was insured. The exclusions contained in the two automobile policies are not limited to uninsured automobiles owned or regularly used by the insured. Both policies provide:
“This coverage does not apply to bodily injury sustained by a person:
“1. While occupying any vehicles owned by or provided for the regular use of you or a family member for which insurance is not afforded under this policy.” (Emphasis added.)
The broader scope of the policy exclusion is illustrated by the facts of this case. Under the policies, Gilbert cannot recover for injuries sustained while riding his motorcycle because, although his motorcycle was insured, it was insured under a different policy than his automobiles. However, under the statute, Gilbert may recover for his injuries because his motorcycle was not uninsured.
Because the exclusion in both policies is broader than that authorized by statute, it is unenforceable. In one of'its first opinions dealing with uninsured motorist coverage, the Supreme Court held:
“[Ijnsurance policy provisions which purport to condition, limit, or dilute the broad, unqualified uninsured motorist coverage mandated by [K.S.A. 40-284] are void and of no effect.” Clayton v. Alliance Mutual Casualty Co., 212 Kan. 640, Syl. ¶ 1.
The court expanded on this holding in its order denying a motion for rehearing:
“The provisions of the statute (K.S.A. 1972 Supp., 40-284) must be considered a part of every automobile liability policy the same as if written therein. [Citations omitted.] Where the policy’s provisions regarding uninsured motorists coverage are more restrictive than the relevant statutory provisions requiring such coverage, the requirements of the statute will prevail. [Citation omitted.] Attempts by the insurer to diminish the statutorily mandated uninsured motorists’ protection are contrary to public policy. [Citation omitted.] That the Legislature requires an uninsured motorists provision in every policy, unless expressly waived by the insured, added to the fact that a premium is collected for such protection, must result in a policyholder receiving what he has paid for on each policy, up to the amount of his damages.” Clayton v. Alliance Mutual Casualty Co., 213 Kan. 84, 84-85, 515 P.2d 1115 (1973).
In two subsequent cases, the court held:
“Insurance policy provisions which purport to condition, limit, or dilute the broad, unqualified uninsured motorist coverage mandated by K.S.A. 40-284 are void and unenforceable.” Simpson v. Farmers Inc. Co., 225 Kan. 508, Syl. ¶ 2, 592 P.2d 445 (1979); Van Hoozer, 219 Kan. 595, Syl. ¶ 3.
Relying on these cases, this court has recently held:
“The provisions of the Kansas Uninsured Motorist Statutes, K.S.A. 40-284 et seq., are mandatory and must be considered to be a part of every insurance policy written in this state. Any attempt by an insurer to diminish the statutorily mandated uninsured motorist protection provided by the statute is void and contrary to public policy.” State Farm Mut. Auto. Ins. Co. v. Cummings, 13 Kan. App. 2d 630, Syl. ¶ 1, 778 P.2d 370, rev. denied 245 Kan. 785 (1989).
See Stewart v. Capps, 14 Kan. App. 2d 356, Syl. ¶ 3, 789 P.2d 563 (1990).
Against this weight of authority, Farmers attempts to rely on a statement in DeWitt v. Young, 229 Kan. 474, 480, 625 P.2d 478 (1981), that “exclusions in liability insurance policies are valid and enforceable as to amounts exceeding coverage required in financial responsibility laws.” (Emphasis added). Uninsured motorist coverage is not the same as liability coverage. Forrester, 213 Kan. at 448. Gilbert is entitled to recover underinsured motorist benefits under one, but not both, of his two automobile policies.
ATTORNEY FEES
Gilbert claims that he is entitled to attorney fees under the following provision found in the automobile policies under the heading “PART I — Liability”:
“Supplementary Payments
“In addition to our limit of liability, we will pay these benefits as respects an insured person;
“6. Other reasonable expenses incurred at our request.”
Gilbert reasons that, because Farmers filed this declaratory judgment action, his costs of defending it were incurred at Farmers’ expense.
The relied-upon provision is found in the portion of the policy providing liability coverage. No such provision is present in the portion of the policy providing uninsured motorist coverage.
Gilbert also argues that he is entitled to attorney fees under K.S.A. 40-256.
K.S.A. 40-256 provides:
“That in all actions hereafter commenced, in which judgment is rendered against any insurance company ... if it appear from the evidence that such company . . . has refused without just cause or excuse to pay the full amount of such loss, the court in rendering such judgment shall allow the plaintiff a reasonable sum as an attorney's fee for services in such action, including proceeding upon appeal, to be recovered and collected as a part of the costs.” (Emphasis added.)
We note that, although this action is a declaratory action by the insurer rather than a suit by the insured, the statute still applies. The fact that the insurer got to the courthouse first is not important; the fact that Gilbert was forced to hire an attorney to collect the benefits to which he is entitled is.
In cases where an insurer has denied coverage, on the uncontroverted facts, based upon a mistaken understanding of the coverage mandated or the exclusions permitted by statute, the appellate courts of this state have generally held that the insurer was not “without just cause or excuse” if there was a genuine issue, raised in good faith, as to coverage. In practice, this has often meant that the insurer s interpretation of the statute in drafting its policy and its subsequent denial of coverage must be reasonable.
In Forrester v. State Farm Mutual Automobile Ins. Co., 213 Kan. 442, the court, after holding that an exclusion was void because it diluted the coverage required by statute, addressed the question of attorney fees:
“Whether attorney fees are to be allowed must depend upon the facts and circumstances of each case [citations omitted]. We believe the dispute between the parties herein constituted a good faith legal controversy as to the policy-statute interpretation and was of first impression in this jurisdiction. Moreover, as has been pointed out in this opinion, authorities from other states are divided concerning the validity of exclusion (b) with respect to uninsured motorist statutes. Under the circumstances related, we think defendant, though mistaken, has not been unreasonable in assuming its position. Hence, we do not believe the allowance of attorney fees to plaintiff is justified.” 213 Kan. at 452.
The court expanded on this holding a few years later in Van Hoozer v. Farmers Insurance Exchange, 219 Kan. 595, 549 P.2d 1354 (1976). In that case, the facts were both unusual and complicated. Plaintiffs husband added uninsured motorist coverage to his policies in May 1968, shortly before such coverage became governed by statute. 219 Kan. at 597. Later that morning, he was killed by an uninsured motorist. The insurer denied most of plaintiffs claim for uninsured motorist benefits on the basis that, under the policy, coverage was reduced by the amount of workers compensation received. The trial court held that, on the facts of the case, K.S.A. 40-284 applied to the policies, even though the statute had not yet gone into effect at the time, and that the statute did not permit the reduction of benefits by the amount of workers compensation received. The Supreme Court affirmed. 219 Kan. at 598-608.
The trial court also held, however, that attorney fees were not recoverable because a good faith legal controversy existed. Plaintiff cross-appealed on this issue, and the Supreme Court affirmed, writing:
“Plaintiff argues the policy defense relied on by defendant prior to the commencement of litigation was clearly unfounded. As previously noted, defendant originally based its refusal to pay on the policy exclusion relating to the reduction of benefits by the amount of workmen’s compensation received. Although defendant was notified by the insurance commissioner prior to trial that its defense would not be valid under the new uninsured motorists statute, there was substantial cause for defendant to believe the new statute would not apply since it did not become effective until after the accident. We have heretofore demonstrated the error in defendant’s reasoning. Yet the misconception upon which defendant based its refusal was not such that would indicate an arbitrary, capricious or bad faith motive. The question of the application of the uninsured motorist statute to an accident occurring prior to its effective date was one of first impression in this state. We cannot say defendant refused plaintiffs claim without just cause or excuse.” 219 Kan. at 615.
Thus, if an insurer has “substantial cause” to believe that its interpretation of statutory requirements is correct, and it denies coverage in good faith, fees may not be awarded.
This court has reached similar holdings. In Hand v. State Farm Mut. Auto Ins. Co., 2 Kan. App. 2d 253, 577 P.2d 1202, rev. denied 225 Kan. 844 (1978), the insurer denied a claim for personal injury protection (PIP) survivor benefits based on its understanding of the word “loss” as used in the No-Fault Act and in its policy. 2 Kan. App. 2d 255-56. After reviewing the legislative history of the act, we held for plaintiff. 2 Kan. App. 2d at 259. We denied fees, however, holding: “[Defendant was not guilty of a frivolous and unfounded denial of liability; the legal issue involved is one of first impression and defendant’s position was not without merit.” 2 Kan. App. 2d at 261. See Whitaker v. State Farm Mut. Auto Ins. Co., 13 Kan. App. 2d 279, 285, 768 P.2d 320 (1989) (“the presence of a genuine issue raised in good faith bars an award of attorney fees”).
Whether fees should be awarded in this case presents a close question. Farmers’ first argument — that uninsured motorist coverage does not apply when the insured is driving another vehicle — is clearly unfounded. Farmers’ second argument — that coverage was excluded under the policies- — although unsound, is not without merit. The scope of the exclusion authorized by K.S.A. 1989 Supp. 40-284(e)(l) has never before been litigated. Farmers, as we view the record, has been acting in good faith, and, although the question is perhaps close, Farmers’ interpretation of the statute in drafting its policy and its subsequent denial of coverage were not unreasonable. We therefore conclude that fees should not be awarded.
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Elliott, J.:
Fidelity & Deposit Company of Maryland (F&D) and the law firm of Sloan, Listrom, Eisenbarth, Sloan & Glassman (Sloan) appeal from a jury verdict and trial court sanctions concerning plaintiff The Southgate Bank’s (Bank) blanket bond insurance coverage.
We affirm in part and reverse in part. The facts will be detailed only as necessary in deciding the issues presented by the appeal.
Kroh Brothers Development Corporation sought to borrow money from the Bank, which would have exceeded Bank’s lending limit. Instead, brothers George and John Kroh personally borrowed each with their wives signing the notes as co-
borrowers and co-obligors. We are concerned only with the loan to George and Carolyn Kroh.
The loan went into default and Bank sued George and Carolyn to collect the debt. George then filed bankruptcy proceedings in Missouri. Carolyn in her answer pled her signature on the note was not genuine (George’s personal secretary admitted signing Carolyn’s signature on the note).
Subsequently, Bank filed a proof of loss with F&D under its blanket bond, which covered loss from forgeries. F&D denied coverage and refused to pay the claim.
Bank, at F&D’s request and pursuant to Bank’s contractual obligation to protect F&D’s potential subrogation rights against George, filed a complaint in George’s bankruptcy case seeking a nondischargeable judgment for the debt. F&D did not intervene in the bankruptcy action.
The bankruptcy court, based “on the evidence of record, and the consent of [George’s] counsel,” found that George had rep-, resented to Bank that the note had been executed and delivered by Carolyn; that in consideration of and in reliance on the note, Bank extended credit; that Carolyn’s signature had been forged; and that George had actual knowledge of the forgery. Accordingly, the bankruptcy court granted Bank a nondischargeable judgment against George in the amount of $675,000, plus $154,602 in interest, with interest continuing to accrue at the contract rate.
Eventually, the trial court took judicial notice of the bankruptcy court’s finding that Carolyn’s signature was forged. The jury found that F&D had breached its obligation to Bank with respect to the note under section D of the blanket bond.
Post-trial, the district court denied Bank’s request for fees pursuant to K.S.A. 40-256; denied F&D’s motion for new trial; and granted sanctions against F&D and Sloan. F&D and Sloan appealed, and Bank cross-appealed.
THE APPEAL
F&D contends the trial court erred in judicially noticing the bankruptcy findings and in precluding it from relitigating the issue of whether Carolyn’s signature on the note was forged.
Traditionally, a former finding is binding only on the parties to the proceeding in which it was rendered and their privies. Keith v. Schiefen-Stockham Insurance Agency, Inc., 209 Kan. 537, 546, 498 P.2d 265 (1972). F&D argues it was not in privity with its insured Bank; it was not a party to the nondischargeability complaint in George’s bankruptcy case.
As we read Patrons Mut. Ins. Ass’n v. Harmon, 240 Kan. 707, 711, 732 P.2d 741 (1987), where there is a separate action on the coverage question, issues decided against the insurer’s interest in an underlying tort suit can have binding or estoppel effect. On the other hand, a reservation of the coverage question in an underlying action can preclude application of collateral estoppel. See State Farm Fire & Casualty Co. v. Finney, 244 Kan. 545, 549, 770 P.2d 460 (1989).
In the present case, the complaint in bankruptcy court was filed pursuant to Bank’s contractual obligation to protect F&D’s subrogation rights against George, and at F&D’s request. F&D did not intervene or protect its right to litigate the issue of forgery (and therefore coverage) in a later action.
Additionally, F&D’s actions are analogous to invited error. Having requested Bank to pursue the forgery issue in bankruptcy court, it cannot now complain that Bank was successful in achieving that which was requested: a nondischargeable judgment against George based on forgery and fraud. See Manley v. Wichita Business College, 237 Kan. 427, 438, 701 P.2d 893 (1985).
F&D also argues that, because the bankruptcy judgment resulted from less than a full-blown adversarial proceeding, it must, therefore, have resulted from “legal collusion”; thus, it was not binding on F&D. We disagree, as did the trial court.
In Shelman v. Western Casualty & Surety Co., 1 Kan. App. 2d 44, 54, 562 P.2d 453, rev. denied 225 Kan. 845 (1977), the fact that plaintiffs claim in an underlying tort case was not contested did not support an inference of “legal collusion” that would bar application of the doctrine of collateral estoppel. See also Banister v. Carnes, 9 Kan. App. 2d 133, 675 P.2d 906 (1983) (res judicata effect given to 8 default judgment).
In addition, F&D acquiesced in the resulting bankruptcy court judgment by requesting Bank to proceed and then failing to intervene or protect its interest against Bank.
Finally, F&D’s argument that Bank raised the collateral estoppel issue too late for F&D to protect itself makes sense only if F&D failed to properly research and prepare for the recognized potential of a collateral estoppel claim.
The trial court did not err in judicially noticing the bankruptcy court findings and in precluding F&D from relitigating the issue of forgery.
F&D next claims the trial court erred in not allowing expert testimony regarding what is reasonable banking practice. During the trial, it appears that everyone accepted the general principle that negligence of the insured Bank is not a defense to F&D’s liability under the bond. See First Hays Banshares, Inc. v. Kansas Bankers Surety Co., 244 Kan. 576, 588, 769 P.2d 1184 (1989).
F&D argued to the trial court that its evidence of negligence was not offered as an exclusion or defense but rather went to the issue of what caused the loss. In effect, F&D wanted to show that Bank was falling all over itself to loan money to the Krohs and did not rely on'the forged signature.
Bank admitted causation could go to the jury as relevant evidence of its reliance on the forged signature, but objected to any evidence which merely stated Bank acted negligently.
The trial judge felt that F&D was trying to bootstrap negligence into reliance arid commented: ■
“Now you say that you "are not relying on the negligence as a defense; you just simply want to submit it as one possible causation. Frankly; I’m having a lot of trouble making the distinction that you are trying to make me make because it seems to me that when you rely on the defense of contributory negligence in an automobile accident case or comparative negligence, what you are saying is the injury was caused by the plaintiffs own negligence.”
F&D was told it could present evidence relating to the issue of reliance, but was instructed not to use the word “negligence.” The trial court, therefore, did not expressly prohibit F&D from putting on its expert witnesses. F&D, in fact, did not call the witnesses. Instead, at the close of trial, F&D proffered testimony to the effect that Bank’s handling of the loan transaction failed to meet reasonable, banking standards and was therefore negligent.
Given these facts; we fail to see how the trial court erred in its rulings. The trial corirt did not prohibit expert testimony on the issue of causation so long as the word “negligence” was not used. Surely, F&D’s experts could have testified concerning conduct falling below reasonable banking standards without using the forbidden word. But F&D did not even attempt to put on the expert testiinony. By its own actions, this claimed error would be harmless at. best. See Hagedorn v. Stormont-Vail Regional Med. Center, 238 Kan. 691, 701, 715 P.2d 2 (1986); Manley v. Wichita Business College, 237 Kan. 427, 438, 701 P.2d 893 (1985).
F&D next argues the trial court erred in refusing to give its requested instruction on causation.
..Tbe trial court instructed the jury that for Bank to recover on the forged note, it had to prove it suffered a loss as a direct result of the forgery. F&D requested an instruction, which essentially defined “direct cause” as the sole cause.
Errors regarding instructions do not demand reversal unless they result in clear prejudice to appellant. Where the instructions, when considered together and as a whole, are substantially correct and could not reasonably mislead the jury, they will be upheld on appeal. Trout v. Koss Constr. Co., 240 Kan. 86, 88-89, 727 P.2d 450 (1986).
The instructions in the present case are sufficient to be affirmed. Because F&D’s attempt to use negligence as causation evidence was properly excluded, the only question left to consider is a definition of “direct cause.”
“Direct result” — the phrase used by the trial court — is not a difficult term for the jury to understand. The PIK committee recommends that no instruction be given to define causation, and “direct” is the suggested adjective to be used if one is needed. PIK Civ. 2d 5.01. The comments state: “As with ‘reasonable doubt,’ attempts to define causation make the meaning more obscure.”
The instructions submitted in this case were substantially correct and not likely to mislead the jury. The trial court did not err in refusing F&D’s requested instructions.
Finally, F&D and Sloan contend the trial court erred in assessing sanctions against them. We agree.
In F&D’s post-trial motion, one of the reasons given to support its contention of error on collateral estoppel was that the bankruptcy judgment was obtained through collusion. Bank responded with a motion for sanctions under K.S.A. 60-211 and 60-2007 for raising a claim of “collusion, fraud and bad faith which they know to be not well grounded in fact.”
While Bank characterized F&D’s allegation of collusion as an allegation of fraud, our conclusion is that F&D had been pushing only the claim that “legal collusion” is enough to preclude collateral estoppel. F&D based its argument on Grummons v. Zollinger, 240 F. Supp. 63 (N.D. Ind. 1964), where the court found a less than adversarial proceeding was “collusion” enough to preclude collateral estoppel.
Trial courts are encouraged to impose sanctions under the two statutes to protect litigants from harassment in clear cases of violation of professional duty. Rood v. Kansas City Power & Light Co., 243 Kan. 14, 22, 755 P.2d 502 (1988). In order to impose sanctions under K.S.A. 60-2007, the claim must be asserted without reasonable basis in fact and the claim must not be asserted in good faith. 243 Kan. at 24.
It appears to us that Bank’s request for sanctions got the benefit of its own characterization of F&D’s claim. F&D needed to defeat the collateral estoppel effect of the bankruptcy court rulings, and “legal collusion” was a theory that had been followed in other jurisdictions. The fact that the district court properly rejected the theory does not make the claim frivolous or not asserted in good faith. See City of Shawnee v. Webb, 236 Kan. 504, 512, 694 P.2d 896 (1985).
The purpose of K.S.A. 60-2007 is to penalize only willful misuses of the judicial process. Smith v. Dunn, 11 Kan. App. 2d 343, 348, 720 P.2d 1137 (1986). Since F&D had case law to support its claim of “legal collusion,” there was no evidence to support a finding that F&D did not assert the claim in good faith.
We hold, therefore, that the trial court erred as a matter of law in finding the second requirement for imposition of sanctions against F&D and Sloan had been satisfied.
THE CROSS-APPEAL
Bank contends the trial court erred in denying its request for attorney fees under K.S.A. 40-256, which provides for fees when an insurance company refuses a claim without just cause or excuse.
In order to justify an award of fees, the denial of a claim must be frivolous and unfounded and must be patently without any reasonable foundation. Clark Equip. Co. v. Hartford Accident & Indemnity Co., 227 Kan. 489, 493-94, 608 P.2d 903 (1980).
The question of whether an insurance company refused to pay a claim without just cause or excuse presents a question of fact for the trial court. 227 Kan. at 493.
There is ample competent evidence to support the finding that a genuine issue existed as to whether Bank relied on the forged signature, to constitute just cause or excuse for F&D’s refusal to pay the bond claim. Although Bank takes issue with the language of the trial court’s memorandum, the court’s reasoning simply reflects the accepted standard that, if a good faith question of law or fact exists, then the insurance company has not refused payment without just cause or excuse. See Friedman v. Alliance Ins. Co., 240 Kan. 229, 239, 729 P.2d 1160 (1986).
Whether just cause exists is to be determined by the circumstances facing the insurer when payment is denied, judged as they would appear to a reasonably prudent person having a duty to investigate in good faith. Watson v. Jones, 227 Kan. 862, 871, 610 P.2d 619 (1980).
In the present case, the trial court’s comments clearly indicate that, even if there had been a full-blown investigation, F&D would have had genuine issues of fact and law to justify litigation of the coverage question.
The trial court did not err in denying Bank’s request for fees under K.S.A. 40-256.
As to the appeal, the judgment is reversed as to the assessment of sanctions and is affirmed as to all other issues. The cross-appeal is affirmed. | [
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Davis, J.:
This is an interlocutory appeal by the State from an order suppressing evidence seized pursuant to a search warrant. After the defendant was bound over, the trial court reversed itself by suppressing evidence seized from the defendant’s residence based upon its finding that the affidavit did not provide probable cause for the issuance of the warrant and that, based upon State v. Doile, 244 Kan. 493, 769 P.2d 666 (1989), the good faith exception to the exclusionary rule was not applicable. We reverse and remand for further proceedings.
The facts, as stated by the trial court, are not in dispute:
“On September 20, 1988, Kansas Bureau of Investigation Agent James Young and Allen County Sheriff Ron Moore conducted an aerial search of farms in eastern Allen County in an attempt to locate growing marijuana. A growing patch of marijuana plants was located on a farm owned by Clyde Bartlett, the father of the defendant. During the afternoon of September 21 a search warrant was issued authorizing law enforcement officers to search the Clyde Bartlett farm. The warrant was executed the morning of September 22nd.
“At approximately 12:00 noon on September 22nd officers obtained a warrant for the arrest of James Bartlett and a search warrant for his residence. The complaint filed against James Bartlett charges him with the crime of possession of marijuana with intent to sell. The affidavits filed in support of the complaint and application for search warrant contain identical language:
‘At 9:30 a.m. on 9-22-88 special agent James Young and Tom Williams, of the K.B.I. executed a search warrant at the Clyde Bartlett residence NW Vi Sec. 3, Twp. 25 S, Range 21 E. The agents found 50 plus marijuana plants growing, tied to stakes, with black water pipe leading to old well. Other items associated with the cultivation of marijuana were seen through an open V2 door of a milk shed near the plants. Clyde Bartlett returned to residence while warrant was being executed and the warrant was read to him. Mr. Bartlett stated he did not farm - that his son James “Tudor” Bartlett does all farming and has control of the fields and buildings. Clyde Bartlett also told the agents that Charles “Chuckie” Hurd is employed by his son to assist in farming.’
“During their search of the James Bartlett home and detached garage officers seized quantities of marijuana and cocaine, guns, and numerous other items believed by officers to be evidence of the crime charged. The home of James Bartlett is located approximately one mile from the farm owned by his father where the growing marijuana was found.”
Standard of Review
When called upon to review the magistrate’s issuance of a search warrant, the duty of a reviewing court “is simply to ensure that the magistrate had a substantial basis for concluding that probable cause existed.” State v. Abu-Isba, 235 Kan. 851, Syl. ¶ 3, 685 P.2d 856 (1984) (following Illinois v. Gates, 462 U.S. 213, 238-39, 76 L. Ed. 2d 527, 103 S. Ct. 2317 [1983]). In Illinois v. Gates, the United States Supreme Court also stated: “[A]fterthe-fact scrutiny by courts of the sufficiency of an affidavit should not take the form of de novo review. A magistrate’s ‘determination of probable cause should be paid great deference by reviewing courts.’ ” 462 U.S. at 236. In a subsequent case, the United States Supreme Court reversed a decision suppressing evidence, holding:
“The Supreme Judicial Court also erred in failing to grant any deference to the decision of the Magistrate to issue a warrant. Instead of merely deciding whether the evidence viewed as a whole provided a ‘substantial basis’ for the Magistrate’s finding of probable cause, the court conducted a de novo probable-cause determination. We rejected just such after-the-fact, de novo scrutiny in Gates.” Massachusetts v. Upton, 466 U.S. 727, 732-33, 80 L. Ed. 2d 721, 104 S. Ct. 2085 (1984).
Although Illinois v. Gates, Massachusetts v. Upton, and State v. Abu-Isba each involved review by an appellate court, the standard of review established by these cases is equally applicable when review is by a trial court. Thus, the issue in this case is not whether probable cause actually existed, but whether the issuing judge had a “substantial basis” for concluding that it did.
Totality of the Circumstances Approach
At the crux of the trial court’s decision to suppress the evidence was the court’s conclusion that the affidavit contained no evidence showing “that drug-related activities were occurring at the James Bartlett residence.” While it is true that there was no direct evidence of drug-related activities at defendant’s residence, such evidence is not required, under the “totality of the circumstances” approach to probable cause, if it is reasonable under all the facts and circumstances disclosed in the affidavit to believe that the articles sought are located at his residence.
The United States Supreme Court rejected specific, elaborate tests for determining probable cause in favor of a “totality of the circumstances” approach. In Illinois v. Gates, the Court explained:
“Perhaps the central teaching of our decisions bearing on the probable-cause standard is that it is a ‘practical, nontechnical conception.’ Brinegar v. United States, 338 U.S. 160, 176 (1949). ‘In dealing with probable cause, ... as the very name implies, we deal with probabilities. These are not technical; they are the factual and practical considerations of everyday life on which reasonable and prudent men, not legal technicians, act.’ Id., at 175. Our observation in United States v. Cortez, 449 U.S. 411, 418 (1981), regarding ‘particularized suspicion,’ is also applicable to the probable-cause standard:
‘The process does not deal with hard certainties, but with probabilities. Long before the law of probabilities was articulated as such, practical people formulated certain common-sense conclusions about human behavior; jurors as factfinders are permitted to do the same — and so are law enforcement officers. Finally, the evidence thus collected must be seen and weighed not in terms of library analysis by scholars, but as understood by those versed in the field of law enforcement.’
“As these comments illustrate, probable cause is a fluid concept — turning on the assessment of probabilities in particular factual contexts — not readily, or even usefully, reduced to a neat set of legal rules.” 462 U.S. at 231-3Í
Kansas courts have subsequently adopted the “totality of the circumstances” approach put forward by the United States Supreme Court in Illinois v. Gates. See State v. Doile, 244 Kan. at 500-01; State v. Abu-Isba, 235 Kan. at 854. Thus, in deciding whether to issue the warrant,
“a magistrate should consider the ‘totality of the circumstances' presented and make a practical, common-sense decision whether there is a fair probability that a crime has been committed and that the defendant committed the crime, or that contraband or evidence of a crime will be found at a particular place.” Doile, 244 Kan. 493, Syl. ¶ 4; Abu-Isba, 235 Kan. 851, Syl. ¶ 3.
Although the precise question raised in this case has not been decided by Kansas courts, we have no hesitancy in concluding that a magistrate may issue a search warrant for a suspect’s residence if the magistrate has probable cause to believe that the suspect possesses the items sought even though there is no direct evidence that the items are located at the residence. Numerous federal courts dealing with a similar question have concluded that, in the absence of direct evidence, the totality of circumstances may support a conclusion that probable cause exists to search a defendant’s residence.
A leading case is United States v. Rahn, 511 F.2d 290 (10th Cir.), cert. denied 423 U.S. 825 (1975). The Bureau of Alcohol, Tobacco & Firearms (ATF) learned that Rahn, an ATF agent, had taken and still possessed confiscated weapons he had certified as destroyed. Based on this information, the ATF obtained a warrant to search Rahn’s residence. 511 F.2d at 291-92.
On appeal, Rahn argued that the affidavit did not demonstrate probable cause to believe that the items sought would be found at his residence. The Tenth Circuit disagreed. It began its analysis by noting:
“ ‘The situation here does not differ markedly from other cases wherein this court and others, albeit usually without discussion, have upheld searches although the nexus between the items to be seized and the place to be searched rested not on direct observation . . . but on the type of crime, the nature of the missing items, the extent of the suspect’s opportunity for concealment, and normal inferences as to where a criminal would be likely to hide stolen property.’ ” 511 F.2d at 293 (quoting United States v. Lucarz, 430 F.2d 1051 [9th Cir. 1970]).
The court then stated: “The issue for our determination is whether the facts and circumstances described in the affidavit would warrant a man of reasonable caution to believe that the articles sought were located at appellant’s residence.” 511 F.2d at 293.
Turning to the facts of the case, the Tenth Circuit concluded that the absence of “anyone’s observation of the property at the residence” was “not fatal to a determination that probable cause existed to search the residence.” The court explained that there was probable cause to believe that Rahn still possessed the weapons and that it was reasonable to assume that his house was where he kept such things as weapons. The court considered that, although “there are other places where the guns might have been stored . . . we believe these facts and circumstances gave the magistrate probable cause to believe that the weapons would be found as a result of the search of appellant’s present residence.” 511 F.2d at 293-94.
See United States v. Lucarz, 430 F.2d at 1055 (where affidavit gave probable cause to believe that postal employee had stolen contents of registered mail pouch, it was reasonable, based on the nature of the materials stolen and the suspect’s opportunity for concealment, to believe that the materials would be found at his residence); United States v. Samson, 533 F.2d 721, 723 (1st Cir.), cert. denied 429 U.S. 845 (1976) (where suspect brought handguns to informant’s apartment, exhibited them for sale, and then left with them, it was “a fair inference” that guns would be found at suspect’s apartment); United States v. Maestas, 546 F.2d 1177 (5th Cir. 1977) (where affidavit alleged that suspect was part of counterfeiting ring and had received and passed counterfeit checks, it was reasonable to believe that counterfeiting paraphernalia would be found in her apartment); United States v. Hendershot, 614 F.2d 648, 653-54 (9th Cir. 1980) (where suspect in bank robbery was arrested ten days after robbery, it was reasonable to search his car for clothing, weapons, and disguises used in the robbery and for missing money); United States v. Rich, 795 F.2d 680, 682 (8th Cir. 1986) (where informant told police that suspect had various drugs and a gun, but only methaqualone and cocaine were found on suspect upon his arrest, it was reasonable to assume that the gun and remaining drugs would be found in suspect’s luggage, home, or motel room); and U.S. v. Anderson, 851 F.2d 727, 729 (4th Cir. 1988), cert. denied 488 U.S. 1031 (where suspect was attempting to sell a .45 caliber pistol with a silencer that had been used to kill a police officer, “[i]t was reasonable for the magistrate to believe that the defendant’s gun and the silencer would be found in his residence” even though the affidavit contained no direct facts to that effect).
We believe that the rule stated in these cases is a sound application of the “practical, common-sense” approach adopted by the United States Supreme Court in Illinois v. Gates and followed by the Kansas Supreme Court in Abu-Isba and Doile. Like the Tenth Circuit in Rahn, we also believe that this rule is one which has long been followed in our courts, albeit without express recognition.
We hold that a magistrate may issue a warrant to search a specific place if, based on the facts and circumstances described in the affidavit, it is reasonable to believe that the articles sought are located at the place to be searched. In making this determination, a magistrate should consider the type of crime alleged, the nature of the items sought, the extent of the suspect’s opportunity for concealment, and normal inferences as to where a person would be likely to keep the items sought.
Applying this rule to the facts of this case, we believe that the affidavit presented the issuing judge with a substantial basis, as a matter of law, to believe that the items sought were located on the defendant’s farm or inside his residence. When the officers searched the farm of defendant’s father, they found more than 50 growing marijuana plants. The plants were tied to stakes and connected to an irrigation system. Other items associated with the cultivation of marijuana were seen through the open half-door of a nearby milkshed. Clearly, somebody was cultivating marijuana on the farm and, considering the amount of marijuana involved, which is more than a person would be likely to consume on his own, it was reasonable to believe that the marijuana was being cultivated for sale.
While the officers were conducting their search, defendant’s father arrived and told the officers that his son, the defendant, did all the farming and had control over the fields. If the defendant was harvesting and selling marijuana, one would expect to find cultivation equipment, packaging equipment and materials, and records of sales somewhere nearby. To expect a suspect to transport equipment and unpackaged marijuana over large distances is simply not realistic. Since these materials were not found on the farm of defendant’s father, the next logical place to look was on the farm of the defendant. Defendant’s farm was located only a mile away, and the short distance between the two farms meant that defendant could quickly and easily transport equipment and marijuana between the two farms without an undue risk of detection. And since defendant’s farm contained both his place of business and his residence, it was reasonable to assume that this was where defendant would package and sell marijuana.
Remembering that probable cause is a practical, common-sense conception turning upon the probabilities of everyday life (Illinois v. Gates, 462 U.S. at 231-32), and that our review is limited to whether the issuing judge had a “substantial basis” for concluding that probable cause existed to search defendant’s farm and residence (State v. Abu-Isba, 235 Kan. 851, Syl. ¶ 3), we conclude that a “substantial basis” to search defendant’s farm and residence existed as a matter of law. Accordingly, the trial court erred in holding that the search warrant should not have issued.
“Good Faith” Exception
Based upon our conclusion that as a matter of law there was a substantial basis for the issuance of the warrant, we need not address the trial court’s conclusion that the good faith exception does not apply.
We would note, however, that the “suppression of evidence obtained pursuant to a warrant should be ordered only on a case-by-case basis and only in those unusual cases in which exclusion will further the purposes of the exclusionary rule.” United States v. Leon, 468 U.S. 897, 918, 82 L. Ed. 2d 677, 104 S. Ct. 3405 (1984). Exclusion is not appropriate
“when an officer acting with objective good faith has obtained a search warrant from a judge or magistrate and acted within its scope. In most such cases, there is no police illegality and thus nothing to deter. It is the magistrate’s responsibility to determine whether the officer’s allegations establish probable cause and, if so, to issue a warrant comporting in form with the requirements of the Fourth Amendment. In the ordinary case, an officer cannot be expected to question the magistrate’s probable-cause determination or his judgment that the form of the warrant is technically sufficient. . . . Penalizing the officer for the magistrate’s error, rather than his own, cannot logically contribute to the deterrence of Fourth Amendment violations.” 468 U.S. at 920-21.
Accordingly:
“[i]n the absence of an allegation that the magistrate abandoned his detached and neutral role, suppression is appropriate only if the officers were dishonest or reckless in preparing their affidavit or could not have harbored an objectively reasonable belief in the existence of probable cause.” 468 U.S. at 926.
Reversed and remanded for further proceedings consistent with this opinion. | [
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Brazil, J.:
Cecil Edward Lamb appeals his conviction of indecent liberties with a child, K.S.A. 1989 Supp. 21-3503, contending the trial court erred in admitting videotaped testimony. We affirm.
Lamb was charged with indecent liberties with a child, K.S.A. 1989 Supp. 21-3503, and aggravated criminal sodomy, K.S.A. 21-3506, based upon allegations made by J.S., his seven-year-old stepdaughter. J.S., while visiting her biological father, told police that Lamb had touched and fondled her vagina and had made her place his penis in her hand. J.S. was later interviewed by state social worker Bobbi Wiltse. J.S. repeated the allegations. This interview was videotaped and consisted of J.S. indicating, either verbally or by drawings, what Lamb had allegedly done to her. The drawings were both J.S.’s own rendition of Lamb’s appearance as well as anatomically correct drawings of a man and a little girl, which J.S. marked to indicate where Lamb had touched her. This videotaped interview was later introduced at trial.
Prior to being charged, Lamb stated that in February 1988 he had fondled J.S.’s vagina. Lamb also stated that, at a later date, J.S. had disrobed in his presence, unzipped his pants, and attempted to put her mouth on his penis. Lamb stated that in both instances he had been drinking heavily. Following this interview, Lamb was formally charged.
At trial, the prosecution sought to introduce testimony of the investigating officers and social worker Wiltse to provide foundation for the introduction of J.S.’s videotaped interview. Defense counsel objected to the testimony pursuant to K.S.A. 1989 Supp. 60-460(a), which requires that the declarant be made available for cross-examination. The prosecution then elected to have J.S. testify before putting on any further evidence. J.S. testified about the pictures she had drawn and marked during the videotaped interview. J.S. became confused, frightened, and nonresponsive during the prosecution’s questioning. She apparently confused the jurors as being Lamb’s brothers and sisters. Eventually, all parties agreed that J.S. should not be forced to remain on the stand.
During a hearing conducted outside the presence of the jury, defense counsel asked that J.S. either be found unavailable pursuant to K.S.A. 1989 Supp. 60-460(dd) or that she remain available for cross-examination. The trial judge seemed uncertain which hearsay exception to apply. The court appeared to conclude that J.S. was unavailable under K.S.A. 1989 Supp. 60-460(dd). The court, however, gave defense counsel the option of recalling J.S. for cross-examination. The prosecution again proceeded with foundation evidence for the videotaped interview with J.S., after which the video was played for the jury. That video was followed by a video of J.S.’s cross-examination by Lamb’s attorney at the preliminary hearing. Lamb contends he was not present at the cross-examination. Near the end of trial, the court retracted its K.S.A. 1989 Supp. 60-460(dd) unavailability conclusion and reiterated that counsel could recall J.S. for cross-examination. The defense objected, based upon its reliance on the court’s 60-460(dd) ruling. The court overruled the objection, stating that defense counsel had been given the opportunity to cross-examine J.S. throughout the proceedings.
The jury found Lamb guilty of indecent liberties and not guilty of aggravated sodomy, and he was sentenced to a term of three to twenty years.
Lamb filed a motion for new trial based upon the uncertainty surrounding the State’s introduction of hearsay testimony. Defense counsel argued that the court, by simultaneously ruling that J.S. was unavailable yet subject to cross-examination, had denied Lamb a fair trial.
The trial judge denied he had made a 60-460(dd) finding and stated that he had complied ex post facto with State v. Eaton, 244 Kan. 370, 769 P.2d 1157 (1989) (An exception to the right to confrontation exists where the trial court makes an individualized finding that requiring a child to testify will so traumatize the child as to prevent the child from reasonably communicating to the jury.). The trial judge elaborated that his comment regarding J.S.’s unavailability was merely a comment upon J.S.’s behavior on the stand. The trial judge explained that he offered defense counsel the opportunity to cross-examine J.S. because the prosecution had questioned her on direct examination.
Lamb contends the trial court denied his Sixth Amendment right to confrontation by admitting hearsay testimony without the requisite showing that the alleged child victim would suffer psychological trauma if required to testify in court. The State contends the court did make the requisite finding that the child was traumatized and that Lamb had the opportunity to recall J.S. for cross-examination.
The standard of review, as stated in the reconsideration of State v. Chisholm, 245 Kan. 145, 777 P.2d 753 (1989) (citing Coy v. Iowa, 487 U.S. 1012, 101 L. Ed. 2d 857, 108 S. Ct. 2798 [1988]), is whether the denial of the right to face-to-face confrontation is harmless beyond a reasonable doubt.
The instant case implicates the Sixth Amendment’s confrontation clause and evolving Kansas and federal case law concerning admissibility of videotaped interviews and testimony. The trial took place February 16 and 17, 1989. The Kansas Supreme Court decided State v. Eaton, 244 Kan. 370, on March 3, 1989, and the reconsideration of State v. Chisholm, 245 Kan. 145, on July 14, 1989. The case chronology is important in viewing the trial judge’s actions and statements during trial.
The Sixth Amendment to the United States Constitution, made applicable to the states through the Fourteenth Amendment, provides: “In all criminal prosecutions, the accused shall enjoy the right ... to be confronted with the witnesses against him.”
The United States Supreme Court observed in Coy v. Iowa that “the Confrontation Clause guarantees the defendant a face-to-face meeting with witnesses appearing before the trier of fact. ” 487 U.S. at 1016. The Kansas Supreme Court has reasoned that the right of confrontation includes the right to cross-examine and the right to observe an accuser face-to-face. However, the right to cross-examine is the more critical right. State v. Johnson, 240 Kan. 326, 329, 729 P.2d 1169 (1986), cert. denied 481 U.S. 1071 (1987). The court has iso determined that holdings and analysis regarding K.S.A. 1989 Supp. 60-460(dd) are relevant when examining K.S.A. 22-3433 and K.S.A. 22-3434 because all three statutes concern the admissibility of videotaped statements and testimony. 240 Kan. at 329.
The statutes in question provide for the admission of a prior videotaped recording of a statement made by a child alleged to be the victim of a crime if specific procedures are followed. K.S.A. 22-3433 provides for the admission of statements made prior to the initiation of criminal proceedings. It states:
“(a) In any criminal proceeding in which a child less than 13 years of age is alleged to be a victim of the crime, a recording of an oral statement of the child, made before the proceeding began is admissible in evidence if:
“(1) The court determines that the time, content and circumstances of the statement provide sufficient indicia of reliability;
“(2) no attorney for any party is present when the statement is made;
"(3) the recording is both visual and aural and is recorded on .film or videotape or by other electronic means;
“(7) the person conducting the interview of the child in the recording is present at the proceeding and is available to testify or be cross-examined by any party; [and]
"(9) the child is available to testify.
“(b) If a recording is admitted in evidence under this section, any party to the proceeding may call the child to testify and be cross-examined, either in the courtroom or as provided by K.S.A. 1985 Supp. 22-3434 and amendments thereto.”
K.S.A. 22-3434 states:
“(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:
“(2) outside the courtroom and be recorded for showing in the courtroom before the court and the finder of fact in the proceeding if: (A) The recording is both visual and aural and is recorded on film or videotape or by other electronic means ....
“(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.”
The admissibility question centers on J.S.’s videotaped statement. K.S.A. 1989 Supp. 60-460(dd) appears to be implicated because it concerns the admissibility of “a statement made by a child.” K.S.A. 1989 Supp. 60-460(dd) differs from the other two statutes because it will admit videotaped testimony of a child only after the trial judge holds a hearing and finds the child is unavailable as a witness. Because the trial judge made no finding of unavailability, K.S.A. 1989 Supp. 60-460(dd) is inapplicable to the admission of the videotape. The tape, however, is admissible under K.S.A. 22-3433.
Coy left open the possibility that the core right to face-to-face confrontation was an absolute right not subject to exceptions. The Court stated if any exceptions to the right exist “they would surely be allowed only when necessary to further an important public policy.” 487 U.S. at 1021. The Court noted that any possible exception would also require the trial court to make an individualized finding the child witness needed special protection. 487 U.S. at 1021.
The confusion here between the trial judge and counsel stemmed from the unresolved status of both State v. Eaton and State v. Chisholm prior to the announcement of the decision in Coy. The trial judge and counsel for both parties had repeated discussions regarding which statute was applicable. During J.S.’s testimony on the stand, the court seemed to conclude J.S. had become unavailable for purposes of K.S.A. 1989 Supp. 60-460(dd). However, the judge also stated, “I think she’s available for cross-examination later . . . .” The court also stated it was up to defense counsel to recall J.S. for cross-examination. Later, the trial judge specifically stated that the requisite pretrial hearing pursuant to 60-460(dd) was not held and J.S.’s unavailability had not been determined. The court reiterated that defense counsel maintained the right to cross-examine J.S. During the same exchange between defense counsel and the trial judge, the judge stated, “[B]ut I can’t see how I misled you. . . . [The videotape is] admissible under a whole different statute.”
Toward the close of trial, the judge made his most unambiguous statement regarding K.S.A. 1989 Supp. 60-460(dd). The judge stated:
“Well, I been thinking about this, and even though I might have said something about this child doesn’t look like she’s available under double D at the time, State chose to call her, and they called her. And it wasn’t a double D hearing. It was in front of the jury for purposes of presenting evidence. And I think that if you want to call her and cross-examine her, you’ve got a right to . . . .”
Although the court did not clearly articulate which statute was applicable, it did emphasize that J.S. was available for cross-examination. The judge left the decision of whether to cross-examine J.S. up to defense counsel. The court conducted a pretrial hearing and entertained evidence of the trauma J.S. likely would suffer on the stand. Social worke. Wiltse testified at the hearing that J.S. was timid, scared, and isolated from her siblings. At the conclusion of the hearing, the trial judge admitted J.S.’s videotaped statement.
The Kansas Supreme Court has found both K.S.A. 22-3433 and 22-3434 constitutional, providing the trial court finds that in-court, face-to-face testimony by the child-victim witness would so traumatize the child as to prevent the child from reasonably communicating or would render the child unavailable to testify. State v. Chisholm, 245 Kan. at 152; State v. Eaton, 244 Kan. at 384-85; State v. Johnson, 240 Kan. 326. These statutes provide for the admission of a videotaped statement of a child victim where the child is available to testify and be cross-examined, and “if the court determines that the time, content, and circumstances of the statement provide sufficient indicia of reliability.” 240 Kan. at 331. Cross-examination is safeguarded by allowing it either in the courtroom or as provided by K.S.A. 22-3434. 240 Kan. at 332. The defense counsel had cross-examined J.S. at the preliminary hearing and had an opportunity to cross-examine her at trial but declined to do so. J.S. was hesitant on the stand, but the court made no finding of unavailability. Counsel’s decision not to cross-examine J.S. may have stemmed from his fear of appearing to badger the witness. Defense counsel stated, “[T]he defendant chooses not to recall her for further cross-examination for the reason that it might unnecessarily inflame the jury.”
Following the resolution of State v. Eaton and State v. Chisholm, it is clear that “[t]he fundamental right of a defendant to confront a witness in a criminal trial is not absolute and has exceptions where necessary to further an important public policy.” State v. Chisholm, 245 Kan. at 150. Further, the United States Supreme Court has very recently revisited this issue in Maryland v. Craig, _ U.S. _ , 111 L. Ed. 2d 666, 110 S. Ct. 3157 (1990), a child sex abuse case. The case involved a statutory procedure similar to K.S.A. 22-3434 but which required the trial judge to first “ ‘determinfe] that testimony by the child victim in the courtroom will result in the child suffering serious emotional distress such that the child cannot reasonably communicate.’ ” 111 L. Ed. 2d at 675. The court determined that the “ ‘Confrontation Clause reflects a preference for face-to-face confrontation at trial,’ [citation omitted] a preference that ‘must occasionally give way to considerations of public policy and the necessities of the case.’ ” 111 L. Ed. 2d at 681. Justice O’Connor, writing for the majority, reiterated that the court has recognized the State’s interest in “ ‘the protection of minor victims of sex crimes from further trauma and embarrassment.’ ” 111 L. Ed. 2d at 683. The Court ruled that, where the State makes an adequate showing of necessity, the State is justified in using special procedures that permit a child witness to testify in the absence of a face-to-face confrontation with the defendant. 111 L. Ed. 2d at 685. The requisite finding of necessity must be a case-specific one. The trial court is required to hear evidence and determine if it is necessary to protect the welfare of the witness. Ill L. Ed. 2d at 685.
The criteria articulated in Craig are applicable to the admission of J.S.’s videotaped statement under K.S.A. 22-3433. As the Kansas Supreme Court determined in State v. Johnson, the statute requires that the statement contain “ ‘sufficient indicia of reliability’ ” before it can be admitted. 240 Kan. at 331. As indicated earlier, the pretrial hearing allowed the trial judge to determine J.S.’s state of mind, and apprehension regarding testifying. The trial judge was aware of the context of the taped interview and that a trained social worker conducted the session while it was filmed through a one-way window by a police officer. The interview itself provided sufficient indicia of reliability, while the pretrial hearing and J.S.’s aborted testimony at trial afforded the judge the opportunity to assess the potential trauma to the witness, thus meeting the requisite criteria to satisfy K.S.A. 22-3433 and the requirements of State v. Eaton and State v. Chisholm. At that point during trial, when all parties agreed that J.S. should not be forced to continue her testimony, it was clear that to do otherwise would so traumatize her as to prevent her from reasonably communicating to the jury. State v. Eaton, 244 Kan. at 384-85.
In view of the confusion that existed at the time of trial relative to the applicability of 60-460(dd), 22-3433, and 22-3434, we conclude that the trial court handled the matter in a competent manner; and if there was any error, it was harmless in light of Lamb’s pretrial admission notwithstanding his testimony at trial.
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Rulon, J.:
The Board of Park Commissioners of the applicant City of Wichita (City) appeals from a decision of the district court affirming the decision of the Board of Tax Appeals (BOTA), which denied ad valorem tax exemptions to the City concerning certain park property.
Essentially we have three issues to consider: (1) Whether BOTA had jurisdiction to revoke the City’s exemption as to certain park property; (2) whether BOTA’s corrected order on rehearing was supported by substantial evidence and not arbitrary; and (3) whether certain ex parte communications between the Sedgwick County appraiser and BOTA prejudiced the City. We affirm in part, reverse in part, and remand with directions.
PROCEDURAL AND FACTUAL HISTORY
This appeal concerns two parcels of land: horse stables and a residence. The facts are not generally in dispute.
The first parcel of real property, referred to as “the stables,” is real property approximately a quarter-section in size. The stables were built between 1977 and 1980 and have since operated under various arrangements. The stables property had previously been exempted from ad valorem taxation under BOTA Order No. 787-1, April 7, 1971. The City leased the stables to Bobbi Reichert on May 12, 1986. In the stables lease, the City named this property the Pawnee Prairie Park Riding Stables, referring to it as the “facility.” Pawnee Prairie Park is a large regional park (625 acres) consisting primarily of natural area and is made available to the public through a system of pedestrian and equestrian trails. The Park is immediately adjacent to Wichita Mid-Continent Airport. The stables consist of a bam, pens, arena, farm ground, and hay meadow, along with equestrian trails, wilderness areas, and public picnic areas which make up about one-sixth of the total park area. The real property comprising the stables was described by metes and bounds and was identified as the facility to be leased to Bobbi Reichert in the May 12, 1986, lease.
There is a dispute between the parties concerning the legal sufficiency of this description. The Board of Sedgwick County Commissioners (County), respondent, argues the property was “fully legally described by metes and bounds . . . such legal description being an attachment and part of the lease agreement.” The City contends
“[t]he property subject to the Stables lease is not entirely the same as D-423-UP, the property identified by the BOTA Order. [D-423-UP is a County tax key number identifying a 151-acre tract within Pawnee Prairie Park.] Pawnee Prairie Park is 625 acres, the Stables are 109.5 acres. . . .
“[T]he precise parcel of land [the stables] that is the subject of this appeal has never been determined.”
The lease agreement between the City and Bobbi Reichert provided the facility was to be used to provide the public with riding stables that would include services such as the boarding of horses; providing horses for riding lessons; conducting fun shows, horse shows, junior rodeos, riding instruction, trail rides, and cookouts; and rehabilitating individuals with mental and physical disabilities. The facility was to be open to the public from sunrise to sunset seven days a week. Under the terms of the lease, Bobbi Reichert was to pay one dollar per year as rent and pay the operation’s expenses out of the revenues from the facility. Reichert had the right to mow and bale any hay growing on the property.
Reichert boarded her own horses and those of private individuals on the property. There were no city-owned horses involved in the operation. She used her own horses for teaching and rehabilitative purposes, and leased them to customers for trail rides. Reichert boarded privately owned horses, charging between $78 and $140 per month. Reichert was not paid to operate the stable, but was allowed to keep the fees for boarding the horses, with the potential for profit, even though there was no showing of profit from the stables.
Approximately six weeks after the City and Bobbi Reichert entered into the lease on the stables, they entered into a lease on the residence. The residence lease states that it is necessary that “LESSEE reside near, on, or adjacent to” the stables. The Wichita Airport Authority (WAA) owned the residence and had leased it to the City on June 23, 1986. The City had previously deeded the property to WAA on August 23, 1976.
On thé same date WAA leased the property to the City, the City leased it to Bobbi Reichert. This sublease agreement locates the residence just south of and adjacent to the riding stables facility owned by the City. Under the sublease, Reichert was responsible for paying utilities, repairing any damage above normal wear and tear, paying any taxes which may have become a lien on the property, and carrying and maintaining appropriate insurance as required by the lessor. Reichert waived any and all rights of recovery against the City for or arising out of damages to or destruction of any of her property.
The stables operation ultimately was unsuccesful for a number of reasons. Both leases were terminated in early 1988, and the residence was returned to WAA. The City resumed direct control of the stables. On September 10, 1986, the City filed an appli cation with BOTA for ad valorem tax exemption on the residence. The stables were not listed on the application for exemption. The residence was described by metes and bounds, situated at 2655 S. Tyler Road in Wichita, Kansas. A hand-written key number of D-425-UP appeared on the face of the application where the form requests specific description of the property to be exempted. After the City submitted its application for exemption, the County Appraiser recommended the exemption be granted. On October 28, 1987, BOTA, in docket No. 4551-86-TX, denied the application, finding the subject matter of the application, the residence, to be nonexempt. BOTA stated it found neither statutory nor case law authority for exempting residences owned by municipalities. BOTA further found that the City had presented no evidence supporting the use of the residence as a recognized governmental or proprietary function.
The City filed a Motion for Rehearing. BOTA granted the motion and a rehearing was held. Additional evidence was presented and entered into the record. BOTA issued an Order on Rehearing which reaffirmed its original determination and revoked the stables’ exemption. A corrected Order on Rehearing was issued to include the County tax key number of the stables, D-423-UP. The City then filed this appeal.
JURISDICTION
The City contends BOTA had no jurisdiction to expand its Order on Rehearing beyond the property listed on the application for exemption: the residence. The Order on Rehearing not only denied exemption for the residence, but also revoked the existing exemption for the stables. The City contends further that BOTA’s revocation of the stables exemption denied the City notice and an opportunity for hearing as required by the Kansas Administrative Procedure Act.
The County contends that although there is no specific statutory authority for the review of an exemption from ad valorem taxation except for the property for which the exemption is sought, the City inextricably tied the proposed exemption of the residence to the stables. The County contends BOTA had the authority to revoke the stables’ exemption because the two properties were discussed at the hearing on the application.
In reviewing BOTA’s actions on appeal, this court has the power to determine whether, as a matter of law, BOTA acted within the scope of its authority. In re Tax Appeal of Horizon Tele-Communications, Inc., 241 Kan. 193, 197, 734 P.2d 1168 (1987). Additionally, this court’s recent decision in Salina Airport Authority v. Board of Tax Appeals, 13 Kan. App. 2d 80, 761 P.2d 1261, rev. denied 244 Kan. 738 (1988), sheds some light on this issue.
“BOTA is the paramount taxing authority in the state. [Citation omitted.] BOTA is a creature of the legislature, however, and it has only the power given it, expressly or impliedly, by the legislature. [Citation omitted.] BOTA has no general or common law power — only statutory power. [Citation omitted.] If BOTA ‘attempts to exercise jurisdiction over a subject matter not conferred by the legislature, its orders with respect thereto are without authority of law and void.’ [Citation omitted.]
“Broadly, BOTA’s statutory authority includes the power to hear appeals from the director of property valuation and the director of taxation (K.S.A. 74-2437); to act as the State Board of Equalization (K.S.A. 74-2439); to hear and decide applications for refund of protested taxes (K.S.A. 74-2439); and to review taxpayer’s applications for property exemption from taxation (K.S.A. 1987 Supp. 79-213). Nothing in these or any other statutes gives BOTA the express or implied power to order a county appraiser to investigate property which is not the subject of a controversy brought before BOTA.” 13 Kan. App. 2d at 87.
The Salina Airport court stated that the authority to investigate the taxability of specific property lies with other governmental agencies,- not with BOTA. For example, “[c]ounty appraisers have the power to investigate, identify, list, and value property not listed, or which they believe is not adequately listed. K.S.A. 79-1461.” 13 Kan. App. 2d at 87 (emphasis added).
K.S.A. 79-1461 states in part: “[I]f the county appraiser shall be of the opinion that any form filed is not adequate or does not truly represent the property to be appraised, the county appraiser shall investigate, identify, list and value such property.” “The director of property valuation (DPV), not BOTA, has general supervision of the county assessors in the performance of their duties.” 13 Kan. App. 2d at 87.
Here, the City filed for tax exemption under K.S.A. 79-213. The application identified the property for which exemption was sought as D-425-UP, and attachment A described the residence.
No statute, expressly or impliedly, gives BOTA power to investigate property which is not the subject of a dispute before it. We conclude the two parcels are not so intertwined as to constitute one subject of dispute, and therefore BOTA had no jurisdiction to revoke the stables exemption.
In light of the above, the following portions of this opinion are concerned only with the property designated as the residence.
BOTA’S ORDER ON REHEARING
The City contends BOTA’s final order was arbitrary or, in the alternative, not supported by substantial evidence. We shall discuss each contention separately.
The Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-621(c), provides:
“(c)-The court shall grant relief only if it determines any one or more of the following:
“(7) the agency action is based on a determination of fact, made or implied by the agency, that is not supported by evidence that is substantial when viewed in light of the record as a whole, which includes the agency record for judicial review, supplemented by any additional evidence received by the court under this act; or
“(8) the agency action is otherwise unreasonable, arbitrary or capricious.”
The Kansas Supreme Court has held that “[a]rbitrary or capricious conduct may be shown where an administrative order is not supported by substantial evidence.” Kansas Racing Management, Inc. v. Kansas Racing Comm’n, 244 Kan. 343, 365, 770 P.2d 423 (1989). “[I]t is clear that if an order is not supported by evidence or is not within the scope of the tribunal’s authority the order would at least be arbitrary, if not fraudulent or capricious.” In re Tax Appeal of Horizon Tele-Communications, Inc., 241 Kan. at 198. The court has defined “substantial evidence” as “evidence which possesses both relevance and substance, and which furnishes a substantial basis of fact from which the issues can be reasonably resolved.” Kansas Racing Management, 244 Kan. at 365.
A. Arbitrary
The City contends the residence qualifies for an ad valorem tax exemption pursuant to K.S.A. 79-201a Second, which reads in part:
“The following described property, to the extent herein specified, shall be exempt from all property or ad valorem taxes levied under the laws of the State of Kansas:
“Second. All property used exclusively by the state or any municipality or political subdivision of the state. All property owned ... or operated by the state or any municipality or political subdivision of the state which is used or is to be used for any governmental or proprietary function and for which bonds may be issued or taxes levied to finance the same, shall be considered to be ‘used exclusively’ by the state, municipality or political subdivision for the purposes of this section.”
The County contends the residence does not meet the “exclusive use” test for purposes of K.S.A. 79-201a Second as stated by the Kansas Supreme Court. This issue turns on whether the property was used for governmental or proprietary functions.
Whether particular property is exempt from ad valorem taxation is a question of law if the facts are agreed upon. “Taxation is the rule, and exemption from taxation the exception under the Kansas Constitution and statutes. [Citation omitted.] Constitutional and statutory provisions exempting property from taxation are to be strictly construed against the one claiming exemption, and all doubts are to be resolved against exemption.” Tri-County Public Airport Auth. v. Board of Morris County Comm’rs, 245 Kan. 301, 304, 777 P.2d 843 (1989). The party claiming exemption “must bring himself clearly within the exemption.” The court further noted, however, strict construction “does not warrant unreasonable construction.” 245 Kan. at 305. This court has recently ruled that under the Kansas Constitution, article 11, Section 1, all property used for governmental purposes is exempt from taxation. “This exemption depends solely upon the exclusive use made of the property . . . and not on the character of the owner.” Salina Airport Authority v. Board of Tax Appeals, 13 Kan. App. 2d at 83.
In tort liability cases, courts have characterized actions of municipalities as either governmental or proprietary. Krantz v. City of Hutchinson, et al., 165 Kan. 449, 454, 196 P.2d 227 (1948). In its governmental capacity, the municipality exercises its powers of sovereignty acting for the general public good and the municipality receives no compensation or particular benefit. Governmental functions include protecting the public against crime, the exercise of eminent domain, and tax collection. 165 Kan. at 454. All non governmental functions of a municipality are proprietary. These are functions which directly and specifically benefit the particular municipality. 165 Kan. at 455.
We conclude BOTA followed established Kansas case law in denying the City’s application for exemption. The Kansas Supreme Court has held the term “used exclusively,” found in K.S.A. 79-201a Second, “means that the use made of the property sought to be exempted from taxation, must be only, solely and purely for the purposes stated, and without participation in any other use.” Seventh Day Adventist v. Board of County Commissioners, 211 Kan. 683, Syl. ¶ 2, 508 P.2d 911 (1973). Seventh Day Adventist concerned the tax-exempt status of residences rented to teachers in the campus area of the Kansas Conference Association. The teachers paid the bulk of the utility bills and 10 percent of their salaries as rent. Tax exemption of the residences was denied. 211 Kan. at 694. Similarly, in the instant case, Reichert paid all utility bills and $300 per month rent.
Seventh Day Adventist is but one in a series of holdings denying tax exemption to residences. In Vail v. Beach, 10 Kan. *214 (1872), a dwelling house in Lawrence owned by the Diocese of the Episcopal Church and used by the Bishop as his residence was held not to be exempt from taxation for religious purposes. The court noted the property was used like any other residence. 10 Kan. at *216.
This court denied the exemption of a caretaker’s residence owned by the District Advisory Board, Church of the Nazarene, in Kansas City Dist. Advisory Bd. v. Board of Johnson County Comm’rs, 5 Kan. App. 2d 538, 542, 620 P.2d 344 (1980), noting there was no evidence the residence was .used in any way other than as a residence. In the instant case, there is similar evidence that Reichert used the house as her residence. Although the proximity of the residence to the stables undoubtedly facilitated Reichert’s work at the park, clearly she lived in the residence and took her meals, bathed, and engaged in other purely domestic activities at the residence. BOTA’s denial of tax exemption was proper and not arbitrary.
B. Substantial Evidence
We are further persuaded that BOTA’s Order on Rehearing regarding the residence is based on substantial competent evi dence. The record of the administrative proceedings is centered on the use of the residence. Indeed, the residence is the only parcel listed on the City’s application. The residence was the primary topic covered during the February 22, 1988, hearing. The sublease of the residence to Reichert was discussed at some length.
In the Order on Rehearing, BOTA set out a summary of the findings that related to its decision. These findings regarding the residence are supported by substantial evidence. Additionally, these findings are more detailed than those dealt with in In re Tax Appeal of Horizon Tele-Communications, Inc., 241 Kan. 193. In upholding a BOTA order, the court stated: “The orders are quite general in stating the evidence and facts upon which the BOTA relied but scattered throughout are some specific references to the evidence and facts developed in the hearing.” 241 Kan. at 196. In the instant case, BOTA’s order is more substantial than a mere scattering of references to evidence concerning the residence.
EX PARTE COMMUNICATIONS
Finally, the City contends that ex parte communications between the County and BOTA substantially affected the BOTA order and the rights of the City. The ex parte communication referred to is a December 14, 1988, letter from the County Appraiser’s Office to BOTA which contains a request to reference D-423-UP in the Order.
The County contends the letter complained of was delivered after the proceeding had concluded and after the Order on Rehearing had been issued.
The district court held:
“8. Petitioner argues that ex-parte communications between the County and BOTA were improper mandating the Order and Corrected Order of BOTA be set'aside. The Court finds the communications between the County and BOTA were for the purpose of clarifying certain matters in property descriptions and concludes they were entirely appropriate, not substantially affecting the BOTA findings and decision in its Order and Corrected Order.”
Under the Kansas Administrative Procedure Act, no person who has a direct or indirect interest in the outcome of a proceeding may “directly or indirectly communicate in connection with any issue in that proceeding, while the proceeding is pend ing, with any person serving as presiding officer unless notice and an opportunity are given all parties to participate in the communication.” K.S.A. 77-525(c). However, here the communication complained of was delivered after the termination of the proceeding. BOTA issued its original order on October 28, 1987. There was no hearing prior to the issuance of the order because the City had not requested a hearing.
BOTA issued its original order concerning the property described in Exhibit A of the Park Board’s application. Exhibit A is a diagrammed sketch of property described as 2655 S. Tyler Road (the residence), also described by metes and bounds. There is no key number identification on the exhibit and none in the order. “D-425-UP” is hand-written on the application submitted by the City.
On December 1, 1987, the City requested a rehearing, asking that it be allowed to present additional evidence. BOTA ordered a hearing which was to be held on February 22, 1988.
On February 12, 1988, the City’s counsel wrote a letter to the Sedgwick County Appraiser. The City’s counsel attempted to clarify the legal description of key number D-425-UP. The hearing transcript of February 22, 1988, reflects considerable confusion as to the exact identity and location of the property described in the City’s application.
On April 12, 1988, Vic Casper, an appraiser with the Sedgwick County Appraiser’s Office who appeared at the hearing, wrote a letter to David Cunningham of BOTA. Casper explained that the parcel identified in the City’s Exhibit A had a legal description that was only a portion of key number D-425-UP. Consequently, the portion represented by Exhibit A (the residence) should be assigned a different key number. Casper explained in the letter that each parcel of land in the county is assigned a unique tax key number. For taxation purposes, the portion split from an original piece of land is given the same tax key number, but new digits are added to distinguish the portion from the original whole.
The November 30, 1988, Order on Rehearing described the property as “Approximate point 52 acre tract site within Airport Tract No. 68 (Tax Key No. D-425-UP) as described in the affidavit of Gordon Abernathy.” In that same Order, BOTA revoked the stables tax exemption.
Specifically, the communication complained of is a letter from Kay Larkin of the Sedgwick County Appraiser’s Office to David Cunningham of BOTA. This correspondence was written on December 14, 1988, some two weeks after the November 30, 1988, Order on Rehearing. In the letter, Larkin requested a corrected order to include key number D-423-UP which included the stables. Larkin included copies of property record cards which more completely described the stables and residence. Clearly this information was used for clarification only.
We affirm the revocation of the tax exemption as to the property designated as “the residence,” but reverse as to the revocation of the property designated as “the stables.” The case is remanded with directions to reinstate the tax exemption for the property designated as “the stables.” | [
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White, J.:
Clayton Morrison appeals the trial court’s order granting an increase in child support for his daughter Marla, contending that the trial court lacked jurisdiction to modify child support after Marla reached the age of 18. We reverse.
Clayton and Loretta Morrison were divorced in 1973. The divorce decree required Clayton to pay child support for each of their four children. In 1978, Clayton and Loretta agreed to a modification of the support order increasing Clayton’s payments to $250 per month for each of the children during their minority and extending to age 22, provided that the child for whom support was being paid was pursuing a formal education at a full-time accredited educational institution.
On May 18, 1988, Loretta Morrison filed a motion seeking an increase in support for the parties’ youngest child, Marla, who ha'd attained age 18 on May 9, 1988. On her 18th birthday, Marla had not yet completed her junior year of high school.
Clayton challenged Loretta’s motion, alleging that the court had no jurisdiction to modify the contractual agreement of the parties after Marla had reached the age of majority. The trial court held that it had jurisdiction to act upon Loretta’s motion, stating:
“[N]otwithstanding the express language of the statute [K.S.A. 1987 Supp. 60-1610(a)(l)(B)], the intent of the Legislature in adopting the language ‘in which case the support shall not terminate . . . until June 1 of the school year during which the child became 18 years of age if the child is still attending high school . . .’ was to provide support until June 1 of the school year in which the child completes his or her high school education.”
The court increased Clayton’s obligation for support from $250 to $680 per month from July 1, 1988, until June of the year in which Marla was to graduate from high school.
K.S.A. 1987 Supp. 60-1610(a)(l) provided that a court order for child support shall terminate upon a child reaching 18 years of age unless one of two exceptions applies:
“(A) The parent or parents agree, by written agreement approved by the court, to pay support beyond the time the child reaches 18 years of age; or (B) the child reaches 18 years of age before completing the child’s high school education in which case the support shall not terminate, unless otherwise ordered by the court, until June 1 of the school year during which the child became 18 years of age if the child is still attending high school.”
In construing a statute, words of common usage are to be given their natural and ordinary meaning. A court has no right to enlarge the scope of the statute or to amend it by judicial interpretation. Coe v. Security National Ins. Co., 228 Kan. 624, 629-30, 620 P.2d 1108 (1980). The intent of the legislature governs where it can be ascertained from the statute. Farmers Co-op v. Kansas Bd. of Tax Appeals, 236 Kan. 632, 635, 694 P.2d 462 (1985). K.S.A. 1987 Supp. 60-1610(a)(l)(B) clearly states that child support shall not terminate until June 1 of the school year in which the child becomes 18 years of age. The statute does not state that child support shall terminate upon completion of the child’s high school education. We cannot agree with the trial court’s interpretation of the statute.
Loretta argues that the 1988 amendment to K.S.A. 1987 Supp. 60-1610(a) gives the district court the authority to increase child support after the child arrives at the age of majority. The amendment provides:
“Provision for payment of support and education expenses of a child after reaching 18 years of age if still attending high school shall apply to any child subject to the jurisdiction of the court, including those whose support was ordered prior to July 1, 1986. If an agreement approved by the court prior to the effective date of this act provides for termination of support before the date provided by subsection (a)(1)(B), the court may review and modify such agreement, and any order based on such agreement, to extend the date for termination of support to the date provided by subsection (a)(1)(B).” K.S.A. 1988 Supp. 60-1610(a)(l)(B).
While the agreement of the parties providing for the support of Marla was approved by the court prior to July 1, 1986, the 1988 amendment applies only to those cases in which the parties’ agreement provides for termination of support prior to June 1 of the school year during which the child becomes 18 years of age. Since the parties’ agreement contemplates that Clayton shall provide child support for Marla until she reaches the age of 22 years, if she is enrolled in an accredited educational institution, the amendment does not apply to this case.
Although the trial judge relied on the statutory changes to 60-1610(a)(1)(B) in arriving at his conclusion that he had jurisdiction to modify the support order, Loretta relies principally on the premise that the court has jurisdiction to modify a support agreement even though the child has reached the age of majority. Loretta’s counsel contends the trial court should have applied the following exception in K.S.A. 1988 Supp. 60-1610(a)(l)(A):
“The court may modify or change any prior order when a material change in circumstances is shown, irrespective of the present domicile of the child or the parents. Regardless of the type of custodial arrangement ordered by the court, the court may order the child support and education expenses to be paid by either or both parents for any child less than 18 years of age, at which age the support shall terminate unless: (A) The parent or parents agree, by written agreement approved by the court, to pay support beyond the time the child reaches 18 years of age.”
We agree that the (a)(1)(A) exception is applicable.
The case and statutory law of this state firmly establish that orders for payment of child support shall terminate when the child attains the age of 18 years unless by prior written agreement approved by the court a parent has specifically agreed to pay support for a child beyond the age of majority. Brady v. Brady, 225 Kan. 485, 492, 592 P.2d 865 (1979); K.S.A. 1988 Supp. 60-1610(a)(1)(A). Agreements providing for payment of child support beyond the age of majority are enforceable. In Clark v. Chipman, 212 Kan. 259, 510 P.2d 1257 (1973), the Kansas Supreme Court, in addressing the issue of the enforceability of a marriage settlement agreement providing for child support beyond the age of majority, stated: “The appellee’s obligation to support his children under the agreement did not cease when the children attained the age of majority.” 212 Kan. at 266-67.
We find no decisions of the Kansas appellate courts which address the issue of whether the district court has jurisdiction to increase child support after the child reaches the age of 18. The Georgia Supreme Court addressed the issue in Jones v. Jones, 244 Ga. 32, 257 S.E.2d 537 (1979). The court held that, where the child support obligation of a father was extended past the age of majority by an agreement of the parties incorporated in the divorce decree, the trail court had no jurisdiction to modify the amount of support after the child reached age 18.
In Jones, the parties were divorced in 1975. An agreement incorporated into the divorce decree provided that the husband would pay to the wife support for the parties’ three minor children “ ‘until said minor children marry, become self-supporting, complete their college education, become 22 years of age, or die, whichever event occurs first.’ ” 244 Ga. 32. After the divorce, the husband’s income increased substantially, and the wife sought an increase in support. The trial court modified the support order for the two children who were still minors but denied modification as to the third child who had reached age 18, stating that “ ‘the court is of the opinion that it cannot alter a voluntary obligation undertaken by a father beyond his legal obligation.’ ” 244 Ga. 32..
The wife appealed, claiming that the court could modify the support order during the extended period agreed upon (to age 22) as the agreement had become a part of the court’s decree and the Georgia Code provides for modification of support decrees.
The Georgia Supreme Court, affirming the decision of the trial court, held:
“The trial court properly determined that the statutory obligation of this father to each of these children was to support each child until he or she attains age 18. Code Ann. §§ 74-104, 74-104.1, and 74-105; Clavin v. Clavin, 238 Ga. 421 (233 S.E. 2d 151) (1977). He correctly held that the child support obligations of this father were extended in duration past the age of majority of each child by the agreement incorporated into the decree of divorce, McClain v. McClain, 225 Ga. 659 (221 S.E. 2d 561) (1975). He farther correctly held that ... he could not increase the periodic payments for the child who previously had attained the age of 18.
“To accept appellant’s contentions would be to rule that the trial court’s powers during a modification proceeding are greater than its powers during the original alimony proceedings. This is not the law.” 244 Ga. 32-33.
In a 1988 decision, the Louisiana Court of Appeals held that an ex-husband was not bound to support his two children, who had attained the age of majority, beyond the scope of the property settlement agreement of the parties. Hogan v. Hogan, 534 So. 2d 478 (La. App. 1988), reo. granted 536 So. 2d 1226 (La. 1989). Th agreement of the parties required the husband to pay $1,800 per month child support for 12 years, except in the event of substantial financial reverses. 534 So. 2d at 479. The wife sought an increase in support for two children of the parties who had attained the age of majority; the husband sought a decrease in support alleging substantial financial reverses. After considering the financial circumstances of the parties, the trial court denied the claims of both parties. Both appealed. The appellate court reasoned:
“Considering the evidence, we conclude the trial court did not abuse its discretion in denying the claims for increase and reduction of support. Regarding child support we conclude that, while Mr. Hogan is bound by the agreement to pay the items stated therein despite the majority of the two older children, the fact that they are now majors means he is not bound to support them beyond the scope of the agreement.
"Accordingly, Mrs. Hogan is not entitled to seek an increase on behalf of the major children. As for Tammi, the only child still a minor, Mrs. Hogan made insufficient showing that her needs had increased beyond what they were when the in globo award was set.” 534 So. 2d at 481.
Accordingly, we hold that, where the child support obligations of a parent are extended past the age of majority by an agreement incorporated into the decree of divorce, the trial court has no jurisdiction to modify the periodic support payments after the child has attained the age of 18. We recognize that parties to a child support agreement may provide for circumstances in which the court’s order may be modified, as was done in Hogan.
Reversed. | [
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Knudson, J.:
The director of property valuation of the Kansas Department of Revenue appeals from a determination by the district court that the decision of the Board of Tax Appeals was unreasonable and arbitrary.
The taxpayer, a merchant as that term is defined in K.S.A. 79-1001, for each year in issue reported inventory values to the county appraiser in amounts equal to the amounts reported on its federal income tax returns. The taxpayer used the “last in, first out” (hereafter LIFO) accounting method for determining inventory values on its federal tax returns. Under the LIFO accounting method, merchandise most recently sold is considered to be that most recently acquired, while inventory on hand is considered to be that merchandise earliest acquired. The county appraiser, after reviewing the taxpayer’s statements, recomputed the inventory value for each year and additional taxes and penalties were assessed. Thereafter, the taxpayer filed tax protests and grievances with the Board of Tax Appeals to seek abatement of the additional taxes and penalties.
The various applications were heard at the same time by the board and, after hearing, the board found in favor of the taxpayer. The county filed a motion for rehearing and the director of property valuation for the Kansas Department of Revenue intervened. After rehearing, the board reversed itself, deciding that the value of a merchant’s inventory must be based on its fair market value as defined in K.S.A. 79-503a and that the LIFO accounting method was inappropriate. Thus, the board upheld the recomputed valuations made by the county appraiser and the resulting assessments.
The taxpayer filed a petition for judicial review in the Sedgwick County District Court. The district court held that the board erroneously interpreted K.S.A. 79-1001a and 79-1001b, and that the board’s order was unreasonable and arbitrary. The district court ordered appropriate refunds to the taxpayer.
The director of property valuation raises three issues on appeal:
1. Whether K.S.A. 79-1001a and 79-1001b require a merchant’s inventory to be reported and valued at its fair market value as defined in K.S.A. 79-503a;
2. Whether K.S.A. 79-1461 empowers the county appraiser to value a merchant’s property at its fair market value when the appraiser believes that the merchant’s statement of inventory does not adequately represent the value of the property; and
3. Whether K.S.A. 79-1001a and 79-1001b violate Article 11, § 1 of the Constitution of the State of Kansas, which requires a uniform and equal rate of assessment and taxation?
The director contends that a merchant’s inventory must be reported and valued at its fair market value and valuation should not be based solely on the particular accounting method utilized by the merchant.
K.S.A. 79-1001a provides:
“Every merchant shall for the purpose of taxation make and deliver to the assessor a statement giving the fair market value in money of personal property held as inventory within the state of Kansas for sale in his business as a merchant. For the purpose of such statement the fair market value in money of personal property held by a merchant as inventory shall be an amount equal to the average of the fair market value in money of the personal property held as inventory within the state of Kansas for sale by such merchant during his tax year (as established for reporting for federal income tax purposes) next preceding the time of filing the statement of personal property. ”
K.S.A. 79-1001b provides the formula for calculating the fair market value of a merchant’s inventory:
“The average of the fair market value of the personal property held as inventory for sale by a merchant during the preceding tax year, as established for reporting for federal income tax purposes, shall be determined in the following manner:
“(a) Add the fair market value of personal property held as beginning inventory by such merchant on the first day of such tax year, as reported for federal income tax purposes for such year, to the fair market value of personal property not reflected in such beginning inventory which is consigned to and held for sale by such merchant on such date;
“(b) add to the amount computed in subsection (a) the fair market value of personal property held as ending inventory by such merchant on the last day of such tax year, as reported for federal income tax purposes for such year and the fair market value of personal property not reflected in such ending inventory which is consigned to and held for sale by such merchant on such date;
“(c) divide the amount computed under subsection (b) by two . . .; and
“(d) subtract from the average of the fair market value of property held as inventory, as computed under subsection (c), the operating and administrative costs and expenses of the business for which such inventory is listed and reported, including overhead and obsolescence or depreciation in value not reflected in determining the value of inventory under the provisions of subsections (a), (b) and (c), not exceeding an amount equal to 40% of the average value of the inventory of such business as determined under the provisions of subsection (c).”
The taxpayer contends, and the district court found, that these two statutes require a taxpayer to report inventory for ad valorem taxation at the values reported for federal income tax purposes.
The director contends references to federal income taxes in K.S.A. 79-1001a and 79-1001b refer to the tax year established for federal tax purposes, not to amounts reported. That would appear to be a correct statement with regard to the language of K.S.A. 79-100la which refers to the fair market value of property held as inventory “by such merchant during his tax year (as established for reporting for federal income tax purposes).”
However, subsections (a) and (b) of K.S.A. 79-1001b, in setting out the reporting formula, provide that the fair market value of personal property held as inventory on the first day of the tax year “as reported for federal income tax purposes” should be added to the fair market value of the personal property held as inventory on the last day of such tax year “as reported for federal income tax purposes.” (Emphasis added.) This language appears to differ from the language in K.S.A. 79-1001a which seems to refer to the taxpayer’s federal income tax year. The language in K.S.A. 79-1001b, on the other hand, seems to refer to the actual value reported on the federal return.
We are mindful of accepted rules of statutory construction. The fundamental rule of statutory construction is that the purpose and intent of the legislature governs when that intent can be ascertained from the statutes. Southeast Kansas Landowners Ass’n v. Kansas Turnpike Auth., 224 Kan. 357, 367, 582 P.2d 1123 (1978). We believe the statutes in question to be unambiguous and clear as to legislative intent. The legislature, in its wisdom, provided the taxpayer should submit a statement to the county assessor consistent with the inventory value shown upon the taxpayer’s federal return. It is apparent that except in times of significant economic fluctuations this would be an acceptable method upon which the taxpayer and ultimately the taxing authority could ascertain “fair market value” as required under the Kansas Constitution and K.S.A. 79-503a. The legislature was attempting to establish a convenient, workable, and economical mode for determining actual fair market value. Consequently, we conclude the trial court did not err in its determination that the Board of Tax Appeals erroneously interpreted K.S.A. 79-1001b.
The director next contends K.S.A. 79-1461 permits a county appraiser to challenge the rendition of inventory values in the personal property statements that are submitted. The taxpayer argues the county appraiser does not have authority to re-value an inventory when its submitted value conforms with K.S.A. 79-1001b.
K.S.A. 79-1461 provides in part:
“[I]f the county appraiser shall be of the opinion that any form filed is not adequate or does not truly represent the property to be appraised, the county appraiser shall investigate, identify, list and value such property.”
We are persuaded K.S.A. 79-1461 does authorize a county appraiser to scrutinize a taxpayer’s filed inventory statement and re-value listed inventory if necessary to secure compliance with K.S.A. 79-503a. The taxpayer’s reading of the statute is too formalistic and inconsistent with its intended purpose. The statute should be read and construed within the context of a self-reporting tax system. It would be illogical and contrary to a fair and just taxing system to construe the statute as precluding re-valuation by the appraiser. We believe the statute is clear upon this point and altogether consistent with K.S.A. 79-503a and K.S.A. 79-1001b. Therefore, the Sedgwick County appraiser did have authority to re-value the taxpayer’s inventory. It therefore follows that there was substantial competent evidence to support the decision of the Board of Tax Appeals.
The taxpayer in its written brief filed with this court raises the issue as to whether the LIFO method for valuating inventory did in fact render the inventory at its fair market value under K.S.A. 79-503a. Our review of the record persuades us this issue was presented for the first time on appeal and should not be considered. See Kansas Dept. of Revenue v. Coca Cola Co., 240 Kan. 548, 552, 731 P.2d 273 (1987).
Having reached the above determinations, we deem moot the constitutional issue presented for consideration.
We conclude the decision of the Board of Tax Appeals was not unreasonable or arbitrary. Accordingly, the judgment entered by the district court is reversed and the board’s order upon rehearing dated June 8, 1988, is hereby reinstated. | [
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Larson, J.:
Charlene Smith appeals the district court’s denial of her motion for attorney fees pursuant to K.S.A. 40-256.
This garnishment action arises out of an automobile accident on November 30, 1984, in Wyandotte County. Farmers Insurance Company’s insured, Sherrie Blackwell, crossed the center line and struck a car driven by Charlene Smith, causing her serious and disabling personal injuries. Smith’s mother, a passenger in her car, was killed, and Blackwell was critically injured by the severe impact.
Smith sustained fractures of three ribs, multiple contusions to her face, body, and both knees, broken teeth, a nasal septal deviation, and a closed head injury resulting in damage to the olfactory nerve with impairment of her senses of smell and taste. She was hospitalized for a week and incurred medical expenses of $3,614.39. She incurred lost wages from the date of the injury until May 31, 1985, in the sum of $4,541.76. An ear, nose, and throat specialist, Dr. Luke Dlabal, opined the nasal septal deviation could be corrected at a surgical and hospital expense of approximate $2,500. The impairment of the senses of smell and taste was deemed permanent.
Vernon James, a claims adjuster for Farmers, characterized the accident as “a case of serious injuries and clear liability.”
On August 10, 1985, Smith’s attorney wrote Farmers offering to settle Smith’s injuries for the payment of Blackwell’s policy limits of $25,000. Smith’s attorney stated he valued her claim to be worth $50,000.
James had never adjusted a claim involving an allegation of loss of senses of taste and smell and requested additional medical information, which Smith’s counsel furnished. James did not request an independent medical evaluation.
James estimated in his claims status report of December 10, 1985, that the settlement value of Smith’s claim was $20,000. He wrote that, although her attorney would not take less than the policy limits, he did not think the case was worth that much. He did state that if it cost $5,000 to try the case, Smith’s claim could be worth the $25,000 policy limits.
James did not advise Blackwell of the offer to settle for the policy limits or advise her of any of the settlement discussions or negotiations.
Smith’s attorney again wrote James on December 13, 1985, advising that if the case was not settled by December 23, 1985, or significant progress made toward settlement, the offer would be withdrawn and suit would be filed for recovery of Smith’s damages.
On January 6, 1986, although Farmers had given him authority to settle the case for $20,000, James verbally offered $12,500 to settle Smith’s claim and confirmed this offer by a letter.
Smith’s lawyer, on January 13, 1986, wrote James withdrawing the offer to settle for the policy limits and stated Smith would proceed with suit and expected the insured and/or insured’s carrier to pay any judgment in excess of the policy limits. James made no further attempt to settle the claim.
After Smith sued Blackwell on February 24, 1986, Farmers retained outside counsel, who advised the probable verdict range at trial was $22,500 to $30,000. Based upon this recommendation, in March of 1986 Farmers offered to settle for the policy limits, which was rejected by Smith’s counsel.
The case proceeded to trial and the jury rendered a verdict in favor of Smith in the amount of $50,000. Farmers did not appeal and paid its $25,000 policy limits into court.
On May 6, 1987, Smith served a garnishment order on Farmers, seeking to collect the amount of judgment in excess of the policy limits. Farmers answered, denying liability for the claims against Blackwell. After a hearing and introduction of evidence, the trial court found Farmers had failed to exercise good faith and was negligent in failing to settle the claims against Blackwell within the policy limits. In this finding the trial court based its holding on: (1) the strength of the claimant’s case based on the issues of liability and damage; (2) failure of the insurer to properly investigate the circumstances so as to ascertain the evidence against the insured; (3) failure of the insurer to inform the insured of a compromise offer to settle within the policy limits; (4) the amount of financial risks to which each party was exposed in the event of a refusal to settle; (5) a settlement offer of $12,500 at the time authority to settle for $20,000 existed and the likelihood of recovery in excess of the policy limits; (6) failure to obtain an independent medical evaluation and evidence of damages payable for the loss of the senses of smell and taste; (7) failure to exercise a continuing duty to attempt settlement within policy limits prior to suit being filed.
Judgment was rendered against Farmers for an additional $25,000, which Farmers paid without appealing.
Smith then moved for attorney fees pursuant to K.S.A. 40-256 as a result of the garnishment proceedings. The trial court heard arguments and denied the motion, finding the case had presented several novel issues providing “just cause or excuse for Farmers’ refusal to pay the excess judgment.” Smith appeals. We reverse.
Although the trial court characterized three issues as novel and of first impression, we believe there are well-established and longstanding precedents which properly justified the earlier finding of bad faith and negligence on Farmers’ behalf.
The three issues discussed by the trial court in denying the request for attorney fees were:
(1) Whether an insurer can be held liable for an excess judgment for failure to offer policy limits prior to commencement of litigation;
(2) whether an insurer can “cure” its negligent failure to offer its policy limits by offering such limits shortly after commencement of suit; and
(3) whether the measure of damages should be payment of the excess judgment or reasonable attorney fees to the time of the offer of the policy limits.
As early as 1920, the Kansas Supreme Court held that an insurer was liable for the full amount of the insured’s loss, irrespective of policy limits, if it was negligent in conducting the defense for the insured. Anderson v. Surety Co., 107 Kan. 375, 191 Pac. 583 (1920). In Bennett v. Conrady, 180 Kan. 485, 489-91, 305 P.2d 823 (1957), for the first time, bad faith as well as negligence was involved. Bennett held an insurer is liable for the full amount of its insured’s resulting loss, even if that amount exceeded the limits of the policy, for negligence or bad faith in defending or settling an action against the insured.
By the time the landmark case of Bollinger v. Nuss, 202 Kan. 326, 449 P.2d 502 (1969), was decided, bad faith and negligence had tended to coalesce to the point that liability could be imposed against an insurer on either theory.
The trial court herein correctly and properly recognized and applied the “equality of consideration” factors which Bollinger adopted from Brown v. Guarantee Ins. Co., 155 Cal. App. 2d 679, 689, 319 P.2d 69 (1957), requiring insurers to consider the following factors:
“ ‘[1] the strength of the injured claimant’s case on the issues of liability and damages; [2] attempts by the insurer to induce the insured to contribute to a settlement; [3] failure of the insurer to properly investigate the circumstances so as to ascertain the evidence against the insured; [4] the insurer’s rejection of advice of its own attorney or agent; [5] failure of the insurer to inform the insured of a compromise offer; [6] the amount of financial risk to which each party is exposed in the event of a refusal to settle; [7] the fault of the insured in inducing the insurer’s rejection of the compromise offer by misleading it as to the facts; and [8] any other factors tending to establish or negate bad faith on the part of the insurer.’ ” 202 Kan. at 338.
Bollinger makes no distinction between an insurers pre-suit conduct and its post-suit conduct in adjusting or defending a claim. The fiduciary relationship of the insurer and the insured imposes a duty upon the insurer to make reasonable efforts to negotiate a settlement of a claim against the insured. The insurer is obligated to initiate settlement negotiations regardless of the actions of the injured party. Rector v. Husted, 214 Kan. 230, 519 P.2d 634 (1974). In Rector, like here, liability was admitted and the Kansas Supreme Court stated: “[I]t was incumbent upon the appellant ... to make a good faith attempt at negotiating a settlement. . . . Fair and equal consideration of the insured’s vulnerable position demands that reasonable attempts be made to protect him from such exposure.” 214 Kan. at 241-42.
Farmers received a pre-suit policy limits demand and had the identical duty to Blackwell as exists when suit has been filed. In settling and defending actions against an insured, an insurer must act in the best interests of its insured. Spencer v. Aetna Life & Casualty Ins. Co, 227 Kan. 914, 920, 611 P.2d 149 (1980). This is not a novel issue or one in which Kansas law is not settled.
The trial court secondly suggests it is novel to argue that Farmers might “cure” its previous negligent conduct and bad faith by following the advice of counsel and offering the policy limits shortly after commencement of suit. This argument is of no benefit to Farmers. The Kansas Supreme Court has said: “[A]ll the good faith and settlement offers in the world after suit is filed will not immunize a company from the consequences of an unjustified refusal to pay which made the suit necessary.” Sloan v. Employers Casualty Ins. Co., 214 Kan. 443, 444, 521 P.2d 249 (1974).
If an insurer were permitted to “cure” an earlier breach of a fiduciary duty, the policy of encouraging an insurer to exercise due care and attempt to settle claims in a fair and expeditious manner would be undermined. This issue is neither new nor novel and does not create just cause or excuse for failure to pay the excess judgment.
There was ample time given for a full and complete investigation by the insurer after the offer to settle for the policy limits was made on August 10, 1985, before the suit was filed on February 24, 1986. Smith’s counsel furnished all requested' medical reports, agreed to extend time if significant progress toward settlement was being made, and did not file suit “precipitously.” The bad faith and negligence of Farmers in the settlement dealings goes hand in hand with its refusal without just cause or excuse to pay the full amount of the loss.
The rule governing the third suggested issue of difficulty in determining the measure of damages is clear. The breach of the duty of good faith and due care renders an insurer liable for the full amount of the insured’s loss. Covill v. Phillips, 452 F. Supp. 224, 226 (D. Kan. 1978); Bollinger v. Nuss, 202 Kan. at 332. The law on this point has never been seriously challenged and offers no basis for the trial court’s refusal to allow attorney fees.
To reach a final decision in this case, it is of critical importance to realize that the right to claim attorney fees, although initially belonging to Blackwell, Farmers’ insured, became Smith’s through the garnishment proceedings. Gilley v. Farmer, 207 Kan. 536, 544, 485 P.2d 1284 (1971), was a bad faith and negligence garnishment action by an injured party with an excess judgment in which the Kansas Supreme Court quoted B.& M.R. Rld. Co. v. Thompson, 31 Kan. 180, 196, 1 Pac. 622 (1884): “ ‘Garnishee proceedings mean this: the creditor takes the place of the debtor, “Only this and nothing more.” The former takes only that which the latter could enforce.’ ”
The applicable wording of K.S.A. 40-256 is as follows:
“That in all actions hereafter commenced, in which judgment is rendered against any insurance company ... if it appear from the evidence that such company . . . has refused without just cause or excuse to pay the full amount of such loss, the court in rendering such judgment shall allow the plaintiff a reasonable sum as an attorney’s fee for services in such action . . . .”
To give Smith’s argument the proper perspective, we must view the facts and circumstances and test Farmers’ deficiencies as if Blackwell were personally challenging Farmers’ handling of Smith’s claim and seeking recovery for the fees she would be obligated to pay an attorney for doing so.
Blackwell’s exposure to personal liability for the amount of the judgment in excess of $25,000 arose when the judgment became final. At that point, by the garnishment proceedings, the two issues for determination became:
(1) Was Farmers guilty of negligence and bad faith in its handling of Smith’s claim against Blackwell?
Once that was determined affirmatively, the second issue becomes:
(2) Was Blackwell (Smith by virtue of the garnishment) entitled to recover her attorney fees or did Farmers refuse payment because of just cause or excuse?
Whether an insurance company’s refusal to pay is without just cause or excuse is determined on the facts and circumstances in each case. Watson v. Jones, 227 Kan. 862, 871, 610 P.2d 619 (1980). The circumstances confronting the insurer when payment of a loss is denied determines the question, and the circumstances are to be judged as they would appear to a reasonably prudent person 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, Syl. ¶ 5, 498 P.2d 26 (1972).
Generally speaking, it is a question for the district court as the trier of facts to determine whether an insurance company has refused to pay the full amount of an insured’s loss “without just cause or excuse,” thereby subjecting itself to payment of attorney fees under K.S.A. 40-256. Koch, Administratrix v. Prudential Ins. Co., 205 Kan. 561, 564, 470 P.2d 756 (1970). Although two claims representatives of Farmers, Vernon James and Richard H. Holt, testified briefly at the hearing on the motion for attorney fees, the material facts surrounding Farmers’ actions do not involve the credibility of the witnesses, and the controlling facts and exhibits allow us on appeal to examine and consider the evidence as the court did below and determine what the uncontroverted evidence establishes as a matter of law. Koch, 205 Kan. 561, Syl. ¶ 5; see Wolf v. Mutual Benefit Health & Accident Association, 188 Kan. 694, 706, 366 P.2d 219 (1961).
Smith argues the trial court’s decision holding Farmers liable for the excess judgment mandates the conclusion that Farmers acted without just cause or excuse in refusing to pay the excess judgment. We know of no reported Kansas case so holding as a matter of law. Successful prosecution of a suit by an insured does not automatically result in entitlement to attorney fees. Friedman v. Alliance Ins. Co., 240 Kan. 229, 238, 729 P.2d 1160 (1986); Harper v. Prudential Ins. Co. of America, 233 Kan. 358, 372, 662 P.2d 1264 (1983).
Although it can be convincingly argued that a finding of negligence and bad faith wipes out any basis upon which just cause or excuse could exist, we are compelled to follow existing precedent and make this determination based on the facts and circumstances of each case.
Because Farmers has not appealed the imposition of excess liability, all of the findings of fact are conclusive for purposes of determining whether Farmers refused “without just cause or excuse” to pay the full amount of Blackwell’s (Smith’s) loss.
The trial court’s findings and judgment of July 21, 1988, finding bad faith and negligence on Farmers’ part also show the lack of just cause or excuse for its actions as follows:
(1) Farmers admitted liability. Two specialists corroborated Smith’s permanent impairment of smell and taste. The impact was severe. Special damages exceeded $8,000. Additional surgery was indicated. Smith had a strong case.
(2) Farmers failed to properly investigate Smith’s medical condition. An independent medical evaluation was not requested. No attempt was made to refute the findings and conclusions of Smith’s medical reports. An inadequate evaluation of the case in the eyes of a jury existed.
(3) Farmers never informed Blackwell of Smith’s offer. Farmers appeared to give no consideration to its insured’s rights and position. Farmers did communicate with Blackwell’s father regarding settlement (for the policy limits) of a companion claim, but acted without just cause and excuse to its own policy holder to which it owed a fiduciary duty.
(4) The financial risk to Farmers after it valued Smith’s claim at $20,000 on December 10, 1985, was slight while the valuation of Smith’s counsel of the claim as being worth $50,000 (which happened to be the amount of the jury verdict) left $5,000 of its policy limits at risk and $25,000 of its insured’s assets at risk. Farmers should have recognized the likelihood that Smith would recover a judgment in excess of the $25,000 policy limits.
(5) Offering $12,500 when authority of $20,000 existed was not only negligent and in bad faith but without justification or excuse. A reasonably prudent insurer would and should have offered its policy limits of $25,000 rather than expose its insured to an excess judgment. Farmers had the obligation to pursue settlement but made no reasonable effort to do so.
The facts and circumstances show the failure of an insurance company to make a sufficient investigation or obtain necessary independent medical information to properly evaluate the claim; a gross and unpardonable failure to notify its insured that an offer to settle within the policy limits had been received and to inform the insured about the settlement process at a time when her interests were at risk; a failure to give any consideration of the financial risks to the insured; a failure to make any effective attempt to settle; a failure to negotiate reasonably or go forward with settlement action; and finally, the failure to recognize and evaluate its numerous omissions and commissions which made defense of the bad faith and negligence action for recovery of the excess verdict untenable.
When we consider all the facts and circumstances, we hold, as a matter of law, that Smith, by stepping into the shoes of Blackwell, is entitled to reasonable attorney fees for prosecuting the garnishment action. There was no just cause or excuse for Farmers’ actions. The decision of the trial court is reversed and reasonable attorney fees are ordered.
The request for a 3.5 multiplier of Smith’s counsel’s time is unrealistic and unreasonable. This was recognized and admitted by her counsel at oral argument. The trial court is directed to establish and order a reasonable fee for services in the trial court. See Farmco, Inc. v. Explosive Specialists, Inc., 9 Kan. App. 2d 507, 517, 684 P.2d 436 (1984); Hochman v. American Family Ins. Co., 9 Kan. App. 2d 151, 155, 673 P.2d 1200 (1984); Code of Professional Responsibility, DR 2-106 (1988 Kan. Ct. R. Annot. 153).
Smith has also requested allowance of attorney fees for legal services required to perfect and pursue this appeal. Our decision herein and the specific wording of K.S.A. 40-256 that “proceeding^] upon appeal” are included in the services justifying compensation require allowance of attorney fees upon appeal. See Matthews v. Travelers Insurance Co., 212 Kan. 292, 300, 510 P.2d 1315 (1973).
Smith’s counsel is directed to submit to us a statement showing the services performed upon appeal, the time expended, and a requested fee. Farmers’ counsel shall have ten days in which to respond to Smith’s counsel’s filing. We will by separate order set the attorney fees to be allowed upon appeal, which shall become part of the judgment to be granted by the trial court.
Reversed and remanded for further action in accordance with this opinion. | [
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Brazil, J.:
Todd Plank appeals the district court’s order to modify his child support payments. The order, which raised the monthly payments from $150 to $408, is based upon Administrative Order 59 (1988 Kan. Ct. R. Annot. 54), commonly known as the Kansas Child Support Guidelines adopted in compliance with K.S.A. 20-165. We affirm.
On April 10,1984, Todd Plank acknowledged and stipulated in a settlement agreement that he is the father of T.S.D., a minor child born to Donna Dix on December 20, 1981. Plank also agreed to pay $150 per month child support and to provide T.S.D.’s medical health insurance either under Plank’s railroad employment plan or other group employment insurance should he leave the railroad. Plank did not request visitation privileges.
On December 13, 1988, Dix filed a motion to review child support based on Administrative Order 59. After completing Worksheet A from the guidelines, Dix requested the monthly support payment be increased to $508.
Plank acknowledged there should be an increase in support, but testified the amount of increase should be $55.74 for a total payment of $205.74. Plank had also used Worksheet A to determine this amount. He testified that he had calculated the cost of supporting his present wife and child of that marriage using the guideline schedules and had reduced his gross income by that amount.
The court, after consideration of the evidence, found that supplemental considerations should be applied and increased the sum of support from $150 to $408.
1. Material change in circumstances.
Plank argues that the court erroneously considered Administrative Order 59 to be a material change in circumstances which warranted modification of child support. Plank further contends that K.S.A. 1988 Supp. 60-1610(a)(l) requires that a showing of material change be filed in child support cases. He also argues that this statutory requirement was incorporated into Administrative Order 59 and that, in order to justify a modification of an existing order, the movant must demonstrate a material change in circumstances. Plank contends no change was demonstrated.
Plank’s reliance upon the language of K.S.A. 1988 Supp. 60-1610 is misplaced. That statute applies to child support orders in divorce proceedings. Plank and Dix were never married. This action, which resulted in the 1984 settlement agreement, was filed pursuant to Chapter 38 of the Kansas Statutes Annotated. K.S.A. 1988 Supp. 38-1121 provides:
“(a) The judgment or order of the court determining the existence or nonexistence of the parent and child relationship is determinative for all purposes.
“(c) Upon adjudging that a party is the parent of a minor child, the court shall make provision for support arid education of the child including the necessary medical expenses incident to the birth of the child. The court may order the support and education expenses to be paid by either or both parents for the minor child. . . . The court may at any time during the minority of the child prospectively modify or change the order of support as required by the best interest of the child. The court shall enter such orders regarding custody and visitation as the court considers to be in the best interest of the child.
“(e) In determining the amount to be paid by a parent for support of the child and the period during which the duty of support is owed, a court enforcing the obligation of support shall consider all relevant facts including, but not limited to, the following:
(1) The needs of the child.
(2) The standards of living and circumstances of the parents.
(3) The relative financial means of the parents.
(4) The earning ability of the parents.
(5) The need and capacity of the child for education.
(6) The age of the child.
(7) The financial resources and the earning ability of the child.
(8) The responsibility of the parents for the support of others.
(9) The value of services contributed by the custodial parent.”
On April 10, 1984, Plank stipulated that he was the father of T.S.D. All matters relating to support for the child, therefore, come under the Kansas Parentage Act, K.S.A. 38-1110 et seq., and the continuing jurisdiction of the district court.
The language of K.S.A. 1988 Supp. 38-1121(c) clearly states the court may make modifications in the support order at any time based on the best interest of the child. This standard for modification is different than the material change in circumstances standard of K.S.A. 1988.Supp. 60-1610(a)(l). In addition, K.S.A. 1988 Supp. 38-1121(e) lists relevant factors to be considered in awarding support. These specifically include the age of the child and the earning ability of the parents, considerations not listed in K.S.A. 1988 Supp. 60-1610(a)(l).
In any event, Plank is precluded from raising the issue of material change in circumstances on appeal. It is well settled that an issue not objected to at trial will not be heard on appeal. Kansas Dept. of Revenue v. Coca Cola Co., 240 Kan. 548, 552, 731 P.2d 273 (1987). No reference to a timely objection on the issue of material change in circumstances can be found in the record. While counsel for Plank and the court disagreed on the relevancy of some questions, counsel did not object to the court’s ruling on that issue or any other. As noted above, Plank acknowledged there should be an increase in support but testified that it should be raised to only $205.74, using his Worksheet A to determine this amount.
2. Abuse of discretion.
Plank contends the trial court erred: (a) in finding a material change in circumstances because his income had not increased; (b) in finding that, based on the evidence, Administrative Order 59 “controls” the matter; and (c) in misreading the guidelines when it ruled that the guidelines make no provision for the support of others.
Plank argues that the court presumed his income had in creased and thereby abused its discretion in finding a material change in circumstances. The record, however, gives no indication the court made such a presumption or such a finding. Plank’s argument concerning the controlling nature of Administrative Order 59 is difficult to follow but seems to rest on his assertion that the court failed to recognize his inability to pay. However, in the court’s findings, it correctly stated Plank’s financial resources and obligations.
Finally, Plank argues that the court erred in failing to use his computation for subtracting support for his wife and their child from his gross income on Worksheet A. He further complains the court failed to state what supplemental considerations it took into account when reducing the request for support from $508 to $408.
In its conclusions of law at paragraph four, the trial court ruled: “[Plank] may not, under Administrative Order 59, reduce his gross income by deducting a sum therefrom for the support of his child living at home and for the support of his employed wife.” Although Plank’s Worksheet A has not been included in the record on appeal, a reading of the transcript indicates that Plank was attempting to deduct $699 from his monthly gross income by inserting that figure on line 2 of the Worksheet relating to pre-existing support obligations.
In the explanation of Worksheet A, Administrative Order 59 provides: “Pre-existing child support obligations in other cases shall be deducted from the obligor’s gross income to the extent that these support obligations are actually paid.” (Emphasis added.) (1988 Kan. Ct. R. Annot. at 57.) The trial court was correct in not allowing Plank to deduct the support of his present wife and the child of that marriage from his gross monthly income. Such obligation did not pre-exist his child support obligation in this case and was not a court-ordered obligation.
Factors to consider on line 11 of Worksheet A as supplemental child support considerations are:
“1. Needs of the child
a. Uninsured health care
b. Special school needs
c. Financial resources and needs of the child
“2. The overall financial circumstances and need of both parents
a. Visitation expenses
b. Adjustments for extended visitation
c. Shared physical custody
d. Responsibility for support of others
e. Tax considerations
f. Residence with a third party
g. The value of services contributed by the parents
h. Other relevant factors.” (1988 Kan. Ct. R. Annot. at 56.)
Any obligation to support his present wife and the child of that marriage would properly be considered under § 2(d), “Responsibility for support of others.” The court heard testimony from Dix, Plank, and his current wife concerning income, living expenses, debts, and other financial matters. Additionally, there was testimony concerning T.S.D.’s health, which indicated he had been susceptible to pneumonia and had been operated on twice, once on his feet and once on his ears. Dix testified T.S.D. had emotional problems, and Dix wished she could send the child to a church school for help in this area. In addition, because of Dix’s work schedule, T.S.D.’s daycare/babysitting costs a minimum of $3.47 a day during the school year but increases substantially during the summer. The court also heard and considered evidence from Dix on the preparation of Worksheet A and the Rule 139 (1988 Kan. Ct. R. Annot. 87) financial statement. In addition, Plank testified about the support obligation for his present wife and the child of that marriage.
The record shows the court determined that Administrative Order 59 applied to the case. After reviewing all of the evidence, the court decided, on the facts, that supplemental considerations necessitated a reduction of the requested child support increase by $100.
It appears the court considered the guidelines, the relevant financial testimony from the parties, the circumstances of both parents, T.S.D.’s needs, and the financial forms presented to the court. In addition, the court heard closing arguments from counsel prior to rendering a decision. The court’s order of child support is supported by substantial competent evidence.
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Cook, J.:
The Board of County Commissioners of Meade County (County) appeals from the order of the Shawnee County District Court ■ granting the Small Business Administration (SBA) relief from real estate taxes.
The County does not challenge the facts found by the trial court. In a journal entry filed September 29, 1989, the court stated the facts as follows:
“This case represents an appeal by the Small Business Administration, an agency of the United States, from orders on rehearing made by the Board of Tax Appeals of the State of Kansas. The orders of the Board modified its original order granting exemption from, and refund of, certain real estate taxes paid on certain real property held by the Small Business Administration in Meade County, Kansas, from the date of November 12, 1985, to an effective date of November 12, 1986, as requested on original rehearing by Meade County. No one disputes that the Small Business Administration, as an agency of the United States government, is entitled to an exemption from taxation at least from and after November 12, 1986.
“The real estate in question consisted of approximately 156.6 acres. The Small Business Administration held a second mortgage which was foreclosed along with a first mortgage in favor of Travelers Insurance Company by a judgment of the Meade County District Court under date of October 1, 1985, on this parcel and other parcels of which the debtors, Robert C. and Wilma F. Norsworthy, had given mortgages to Travelers Insurance Company among others. The priority of the liens among the mortgagees is not an issue here. A personal judgment on the Small Business Administration’s claim in the amount of $60,371.28 as of October 1, 1985, with interest thereafter, was entered against the Norsworthys and foreclosure of the subject realty decreed with the proceeds of the sale of this particular tract to be first applied to the costs of the action and sale, then to payment of taxes and tax liens, if any, then to the judgment of Travelers Insurance Company, then to the judgment of the Small Business Administration, and then others, junior, so enumerated. The period of redemption in the Norsworthys was fixed at 12 months per the governing statute. An order of sale was duly issued October 14, 1985, notice of sale was duly 5 given for November 12, 1985, and on that date the property was sold to the Small Business Administration on its bid of $75,000 which sale was confirmed by order of the Court under the date of November 22, 1985, directing that a certificate of purchase be issued for such sale. Subsequently, the Norsworthys remained in possession during the period of redemption, but did not redeem and on November 12, 1986, a Sheriffs Deed was issued to the' Small Business Administration and possession assumed by the Small Business Administration. ”
The district court held SBA to be immune from payment of the taxes which accrued during the redemption period.
The issue presented in this case is whether an agency of the United States, which bids in and acquires a certificate of purchase from the sheriff in a mortgage foreclosure action, is liable for taxes accruing on the real estate during the redemption period and before the agency receives the sheriffs deed.
There is no dispute in this case as to the County’s authority to impose a tax directly on the United States or any agency or instrumentality thereof. A state may not, consistent with the Supremacy Clause, United States Const., art. VI, cl. 2, lay a tax “directly upon the United States.” Mayo v. United States, 319 U.S. 441, 447, 87 L. Ed. 1504, 63 S. Ct. 1137 (1943). This prohibition applies to ad valorem taxes imposed by a state or county on real estate owned by the United States. Clallam County v. United States, 263 U.S. 341, 68 L. Ed. 328, 44 S. Ct. 121 (1923). Kansas law also recognizes the prohibition. K.S.A. 79-201a exempts “[a]ll property belonging exclusively to the United States, except property which congress has expressly declared to be subject to state and local taxation,” from all property or ad valorem taxes.
SBA is an agency of the United States and operates under the general direction and control of the President. 15 U.S.C. 633 (1988). It is an integral part of the government mechanism, not merely a separate legal entity. Small Business Adm’n v. McClellan, 364 U.S. 446, 450, 5 L. Ed. 2d 200, 81 S. Ct. 191 (1960). Absent a waiver, SBA stands in the shoes of the United States and is entitled to the same exemption from state and local taxation as is the United States. United States v. City of Roanoke, 258 F. Supp. 415 (W.D. Va. 1966).
In United States v. New Mexico, 455 U.S. 720, 71 L. Ed. 2d 580, 102 S. Ct. 1373 (1982), the Court recognized the difficulty that the immunity issue has given the courts through the years. The Court said:
.“With the famous declaration that ‘the power to tax involves the power to destroy,’ McCulloch v. Maryland, 4 Wheat. [U.S.] 316, 431 (1819), Chief Justice Marshall announced for the Court the doctrine of federal immunity from state taxation. In so doing he introduced the Court to what has become a ‘much litigated and often confused field,’ United States v. City of Detroit, 355 U.S. 466, 473 (1958), one that has been marked from the beginning by inconsistent decisions and excessively delicate distinctions.” 455 U.S. at 730.
In determining whether a federal agency is immune from state or local taxes, the deciding factor is not whether the tax has an effect on the United States but whether the tax is imposed directly on property owned by the United States. The Court in United States v. New Mexico expressed that view as follows:
“We have concluded that the confusing nature of our precedents counsels a return to the underlying constitutional principle. The one constant here, of course, is simple enough to express: a State may not, consistent with the Supremacy Clause, U.S. Const., Art. VI, cl. 2, lay a tax ‘directly upon the United States.’ . . .
“But the limits on the immunity doctrine are, for present purposes, as significant as the rule itself. Thus, immunity may not be conferred simply because the tax has an effect on the United States, or even because the Federal Government shoulders the entire economic burden of the levy.” 455 U.S. at 733-34.
Unquestionably, property owned absolutely in fee simple by •the SBA is immune from state or local taxation. United States v. Roanoke, 258 F. Supp. 415. For the purpose of immunity, it is not necessary that the federal agency be in possession of the property. Thus, it has been held that both the federal government and its bailee were immune from taxation of machinery owned by the government. United States v. Allegheny County, 322 U.S. 174, 189, 88 L. Ed. 1209, 64 S. Ct. 908 (1944). Although it is not necessary for the federal agency to have legal title to the property, immunity must rest on sufficient ownership that it can be said the property was “owned” by the United States. Rohr Corp. v. San Diego County, 362 U.S. 628, 4 L. Ed. 2d 1002, 80 S. Ct. 1050 (1960). There, property owned by the Reconstruction Finance Corporation was declared to be surplus property and the War Assets Administration took possession of the property for purposes of management and disposition. Even though the property was still titled in the Reconstruction Finance Corporation, the Court held:
“[T]he general rule is ‘that lands owned by the United States of America or its instrumentalities are immune from state and local taxation.’ We think the land here was ‘owned’ by the United States.
“ . . . We believe that the appropriate test would turn on practical ownership of the property rather than the naked legal title.” 362 U.S. at 634.
Did the SBA in the instant case acquire sufficient ownership in the property, as a result of being the successful bidder at the sheriffs sale, to justify a finding that it “owned” the property during the redemption, period? The answer requires a determination of the nature of the interest acquired by a purchaser of land in a Kansas mortgage foreclosure action before receipt of the sheriffs deed.
Under Kansas law, a mortgage does not create an interest in land. “[T]he mortgagee acquires no estate whatever in the property, either before or after condition broken, but acquires only a lien securing the indebtedness described in the instrument.” Hall v. Goldsworthy, 136 Kan. 247, 249, 14 P.2d 659 (1932). Thus, Kansas is a “lien theory” jurisdiction rather than a “title theory” jurisdiction. In a “title theory” jurisdiction, the mortgage is viewed as a form of title to property. Conversely, in “lien theory” states, a mortgagee is not entitled to immediate possession of property upon default because the mortgage is merely a lien and not a form of title. Missouri Valley Investment Co. v. Curtis, 12 Kan. App. 2d 386, 388, 745 P.2d 683 (1987).
A mortgage foreclosure sale terminates the relationship between mortgagor and mortgagee. The mortgage lien merges into a decree foreclosing it. Exchange State Bank v. Central Trust Co., 127 Kan. 239, 243, 273 P.2d 477 (1929); Mid Kansas Fed’l Savings & Loan Ass’n v. Zimmer, 12 Kan. App. 2d 735, 755 P.2d 1352 (1988). Thus, it has been held a purchaser at a sheriffs sale “has rights and interests in the real estate superior to those of a lienholder. He is the equitable owner of the real estate. For all purposes except the right of the defendant owner to redeem, he is the owner of the real estate subject only to the superior lien.” Union Central Life Ins. Co. v. Reser, 134 Kan. 876, 880, 8 P.2d 366 (1932). However, only the equitable title passes on confirmation of the sheriffs sale, not the legal title. The legal title remains with the debtor until the sheriffs deed is executed. Motor Equipment Co. v. Winters, 146 Kan. 127, 135, 69 P.2d 23 (1937). It has also been held that the debtor holds the legal title in trust for the purchaser during the redemption period and the record of the foreclosure proceedings is constructive notice of the equitable title acquired by the purchaser at the foreclosure sale. Union Central Life Ins. Co. v. Reser, 134 Kan. at 880.
While prior Kansas cases have used the terms “equitable owner,” “an equitable title,” “a full equitable title,” or “a vested equitable title,” it seems apparent that a purchaser at a foreclosure sale does not receive legal title or “ownership” of the property until the passage of the redemption period. In McFall v. Ford, 133 Kan. 593, 1 P.2d 273 (1931), the court recognized that a mortgagee’s remedy on default is an ordinary foreclosure action and sale of the mortgaged premises. The court further held:
“A judgment for the balance due on the debt secured by the mortgage, and a decree foreclosing the mortgage, have the effect of converting the mortgage lien into the lien of the judgment and decree (Dumont v. Taylor, 67 Kan. 727, 74 Pac. 234); but that is still a lien only upon the property, and is not a transfer of title.
“In Clark v. Nichols, 79 Kan. 612, 100 Pac. 626, a foreclosure proceeding under the redemption law, it was said:
“ ‘The sale and redemption are in a sense parts of the foreclosure proceeding. . . (p. 615.)
“In Bowers v. Jett, 91 Kan. 364, 366, 139 Pac. 383, it was said:
“ . . the property was sold under the foreclosure decree, and the form
of the first-mortgage lien was thereby changed from a judgment to a certificate of purchase, but it was essentially the same demand and was still a first charge.’
“The certificate of purchase serves a purpose of its own. Its function ceases when the deed is made. (Armstead v. Jones, 71 Kan. 142, 80 Pac. 56.)
“In Chambers v. Rose, 111 Kan. 22, 206 Pac. 336, involving the foreclosure of a mortgage after the redemption law took effect, it was held:
“ ‘On the confirmation of a sale of real estate under an order of sale in a foreclosure action only the equitable title to the real estate passes to the purchaser on confirmation; the legal title will not pass until the sheriff’s deed is executed.’
“The statute (R.S. 60-3439) specifically provides that the right of possession shall remain in the defendant owner during the statutory period of redemption, although his title and right of possession during that time is not subject to sale on execution (R. S. 60-3455. See Smith v. Shaver, 112 Kan. 790, 212 Pac. 666.) While the judgment and decree of foreclosure determines the amount due on the debt secured by the mortgage and the extent of the lien on the specific real property, and the order of confirmation determines the regularity of the sale and who shall be entitled to a sheriff s deed, and when such deed shall issue, the right to the deed is conditional upon redemption, and the court still retains jurisdiction to determine any questions which may arise concerning redemption, the actual issuance of the deed, and the placing of the grantee in possession, should a deed issue. Since the deed is the instrument which passes title, and the court has jurisdiction of the cause until after title has passed, there is no complete sale of the property until the deed is in fact issued.” 133 Kan. at 616-18.
In the instant case, it does not appear material whether the legal or practical test is utilized to determine “ownership” of the subject property during the redemption period. The same conclusion must follow.
SBA acquired an equitable interest in the property, not an ownership interest. As noted in McFall v. Ford, the certificate of purchase received by SBA following confirmation of the sheriff s sale is more akin to a lien interest than an ownership interest. It is an interest recognized and protected by courts of equity. While the defendant owner retains legal ownership of the property and enjoys the continued right of possession and benefit of the property during the redemption period, the owner will not be permitted to commit waste thereon or to sell or encumber his interest to the detriment of the purchaser. In that regard, the owner holds the property in trust for the purchaser. However, the purchaser enjoys none of the attributes of ownership during the redemption period. Except in the event of abandonment or waste, the purchaser does not have the right of possession, does not share in the profits or fruits of the land, and cannot interfere with the defendant owner s peaceful .enjoyment of the land. Indeed, the purchaser only has a judgment lien along with the possibility of future ownership. During the redemption, period, the defendant owner has the absolute right to redeem the property by payment of the judgment lien or to sell the property subject to the lien without permission of the purchaser or the court. In such event, the judgment lien is extinguished and the purchaser loses all interest in the property.
As has been indicated, the answer to the question of who is the owner of the property cannot be simply answered by pinpointing who holds legal title. Roberts v. Osburn, 3 Kan. App. 2d 90, 94, 589 P.2d 985 (1979). Incidents of “ownership” in property, however, generally include the rights to its possession and use and the enjoyment of its products, in addition to legal title and the right to sell or otherwise dispose of it. Central Kansas Power Co. v. State Corporation Commission, 221 Kan. 505, 515-16, 561 P.2d 779 (1977); Roberts v. Osburn, 3 Kan. App. 2d at 94. SBA enjoyed none of the usual incidents of ownership in the subject property. It can hardly be said that the mere possibility of receipt of a sheriffs deed in the future will rise to the status of “ownership” under either legal or practical principles.
SBA argues that, even if it did not have an ownership interest in the property during the redemption period, the sheriffs deed conveying fee simple absolute title should relate back to the date of the sheriffs sale. We disagree.
The doctrine of relation back is of ancient origin and has always been applied both at law and in equity to meet the requirements of justice, to protect purchases, and to effectuate the intent of the parties to a contract for the sale of real estate. Hall v. Pioneer Crop Care, Inc., 212 Kan. 554, 560, 512 P.2d 491 (1973). The doctrine is never utilized “for the purpose of doing wrong or injustice, but only for the purpose of doing right and justice.” Marshall v. Shepard, 23 Kan. 321, 325 (1880). It is generally used to protect the title to property from the time of contract to the time of conveyance. It merely relates back to cut off all intervening equities, encumbrances, and conveyances in order to give the purchaser a clear and unencumbered title to the property. Knox v. Doty, 81 Kan. 138, 140, 105 Pac. 437 (1909).
Even though the court applied the relation back doctrine in Knox v. Doty, which involved title to land acquired by a purchaser at a mortgage foreclosure sale after the enactment of the redemption statute, we do not find the doctrine to be controlling under the facts of this case. In Knox, the sale was made in 1895. In 1906 a third person obtained a quitclaim deed from the judgment debtor. The sheriffs sale was confirmed in 1907 and a sheriffs deed was executed to the purchaser who then filed an action to quiet his title to the land. The relation back doctrine was applied to remove the encumbrance and to do justice under the facts of that case.
In the present case, there was no attempt by the defendant owner to convey or otherwise encumber or cloud the equitable interest of SBA. The only reason advanced for utilizing the relation back doctrine is to permit SBA to escape payment of ad valorem taxes accruing during the redemption period. We believe the rights of other taxpayers would be adversely affected by applying the relation back doctrine and such application would result in injustice rather than justice.
If SBA is not required to pay the assessed taxes, the other property owners in Meade County will be forced to absorb an additional tax burden. SBA knew the duration of the redemption period when it bid for the property at the sheriffs sale and the amount of ad valorem taxes that would be assessed during such period. It should have logically assumed the taxes would not be paid by the defendant owner unless the land was redeemed or sold. Thus, it could have bid an amount that would have accommodated payment of the future taxes. An additional consideration is the fair market value of the mortgaged property. If the value of the property exceeds the judgment lien, SBA will recapture its tax liability on future sale. If the value of the property does not equal or exceed the judgment lien and accrued taxes, one could assume SBA used poor judgment in making the initial loan or in its bid at the sheriffs sale. In either event, we do not believe justice would be served by allowing SBA to escape payment of taxes which accrued during the redemption period.
Having decided SBA did not become the “owner” of the subject property until after the expiration of the redemption period and, thus, is not immune from payment of state or local taxes assessed against the property during such period, it is not necessary for us to address the County’s contention that the United States waived its immunity from payment of the ad valorem taxes pursuant to 15 U.S.C. § 646 (1988).
Reversed and remanded to the district court with instructions to enter a judgment in favor of the County in accordance with this opinion. | [
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Rulon, J.:
Thomas Pickrell and Patricia Pickrell, the son and daughter-in-law of Joyce Evans Pickrell, deceased, appeal from the district court’s judgment concerning apportionment of death taxes and administration expenses. We affirm.
On June 9, 1982, Joyce Evans Pickrell executed her last will and testament and a trust indenture establishing the Joyce Evans Pickrell Trust. Carl W. Sebits and Bank IV Wichita were named co-trustees and co-executors.
Article IV, Section 12 of the trust indenture gave the trustees the power to pay all taxes imposed on the trust estate. On . April 23, 1987, pursuant to the powers retained in the trust indenture, Joyce Evans Pickrell amended Section 12 to provide for apportionment of death taxes and administration expenses. The amendment directed and authorized the trustees to pay and distribute to the executors from the trust assets the trust’s proportionate share of federal estate and state inheritance taxes and administration expenses. The amendment further stated that it was the settlor’s intent that the trust assets and the trust and estate beneficiaries bear their respective proportionate share of all taxes and expenses.
The trust provided that, upon Joyce Evans Pickrell’s death, the trust estate would be divided into four equal shares with one share each to be given to her son, Thomas Pickrell, her daughter, Patricia Pickrell Smith Beilis, and two nieces. -
In the second article of her will, Joyce Evans Pickrell directed that all estate and inheritance taxes and administration expenses shall be paid out of the residue of my probate estate.” The will further provided that the executors were not to be reimbursed or to collect any part of the taxes and expenses from any person or beneficiary under the will, and there could be no charge or recovery based on proration, apportionment, contribution, or distribution against non-probate estates or persons not deriving benefits under the will.
Under the fifth article of her will, Joyce Evans Pickrell exercised her power of appointment over the Lloyd R. Pickrell Trust No. 1, a testamentary trust created by her deceased husband. Using the words “appoint, devise and bequeath,” Joyce Evans Pickrell appointed the entire trust estate of her husband’s testamentary trust to a trust created for the benefit of her grandchildren and known as the Joyce E. Pickrell Testamentary Trust.
Joyce Evans Pickrell died on October 7, 1987, and her will was admitted to probate on January 11, 1988. Her survivors include her son, her daughter, five grandchildren, and the two nieces named in her inter vivos trust. Her federal estate tax return shows the value of her taxable assets as $4,984,362.45. The total amount of federal and state death taxes paid at the time of this appeal was $2,097,667.90.
After the will was admitted to probate a dispute arose regarding the trustees’ interpretation of article IV, section 12 of the amended trust indenture. The trustees maintained section 12 authorized and directed them to pay to the estate a sum representing the trust’s proportionate share of the death taxes and administration expenses based on the ratio of trust assets to the total taxable estate. Thomas Pickrell and his wife Patricia disagreed with this interpretation and instead asserted that section 12 was inconsistent with the second article of the will which directs the executors to pay taxes and expenses out of the residuary and not to collect any part of these taxes and expenses from any beneficiaries. The Pickrells argued that the will controlled the question of apportionment of taxes and expenses.
On August 3, 1988, the trustees filed a petition for construction of the trust indenture. One week later the Pickrells filed a petition for construction of the will. The district court consolidated the petitions and found there was no inconsistency between the will and trust indenture concerning the payment of death taxes and administration expenses. The district court found the language of the trust amendment was clear and concise and contained the latest expression of the settlor s intent regarding apportionment of taxes and expenses. The court then directed the trustees to distribute to the executors an amount representing a proportionate part of the death taxes and administration expenses.
Additionally, the court ruled that, in exercising her power of appointment over her husband’s testamentary trust, Joyce Evans Pickrell appointed the assets of her husband’s trust directly to her testamentary trust. The district court further found that the second article of the will precluded the executors from seeking a contribution for any death taxes or administration expenses from Joyce Evans Pickrell’s testamentary trust until the residue of the estate was exhausted.
This appeal involves two written instruments: Joyce Evans Pickrell’s will and the amendment to her inter vivos trust indenture. The interpretation or construction of written instruments is a question of law that may be determined by an appellate court. Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, 133, 754 P.2d 803 (1988).
The Pickrells contend a conflict exists between Joyce Evans Pickrell’s will, which directs death taxes and administration expenses to be paid out of the residuary estate, and the amendment to the trust indenture, which directs the trustees to pay the trust’s proportionate share of taxes and expenses. They assert that the directions of the will should be followed and that the Kansas rule placing the federal estate tax burden on the residuary estate must be given effect. The Pickrells thus maintain the amendment to the trust indenture is ineffective and the trustees are prohibited from contributing trust assets for payment of taxes and expenses.
When the language used in a will is challenged, the first duty of a trial or appellate court is to determine whether the will is ambiguous. In re Estate of Brecklein, 6 Kan. App. 2d 1001, 1007, 637 P.2d 444 (1981). Where a will is not ambiguous, extrinsic evidence of intent is inadmissible. In re Estate of Brecklein, 6 Kan. App. 2d at 1007. The basic principles of will construction are summarized in Russell v. Estate of Russell, 216 Kan. 730, 534 P.2d 261 (1975):
“In construing a will courts must (a) árrive at the intention of the testator from an examination of the whole instrument, if consistent with rules of law, giving . . every single provision thereof a practicable operative effect, (b) uphold it if possible, (c) avoid any interpretation resulting in intestacy when possible, (d) give supreme importance to the intention of the testator, and (e) when the language found in such instrument is clearly and unequivocally expressed determine the intent and purpose of the testator without resort to rules of judicial construction applicable to the interpretation of an instrument which is uncertain, indefinite and ambiguous in its terms.” Syl. ¶ 1.
When the testator’s intent is clearly and unequivocally expressed, the will must be enforced in accordance with its provisions. In re Estate of Wernet, 226 Kan. 97, Syl. ¶ 1, 596 P.2d 137 (1979). The court should not consider the rules of judicial construction to determine the testator’s intent if the language of the will is clear, definite, and unambiguous. 226 Kan. 97, Syl. ¶ 2. Further, although a will speaks at the date of death, the language of a will must be construed as of the date of its execution and in light of the then surrounding circumstances. 226 Kan. at 106.
The rules for construing a trust are similar to those governing will construction. The settlor’s intent is to be determined from the four corners of the trust instrument. See In re Estate of Sutcliffe, 199 Kan. 686, 692, 433 P.2d 389 (1967). If the language of the trust instrument is plain and unambiguous, the intent of the settlor must be ascertained from the language used and given effect. State Bank of Parsons v. First National Bank in Wichita, 210 Kan. 647, Syl. ¶ 2, 504 P.2d 156 (1972).
In the present case, we are convinced there is no uncertainty or ambiguity regarding the payment of estate and inheritance taxes and administration expenses in Joyce Evans Pickrell’s will. The second article of her will directs the executors to pay death taxes and expenses out of the residue of the estate. Additionally, it prohibits the executors from collecting such taxes or expenses from beneficiaries under the will. The language used in the second article clearly expresses the testator’s intent regarding the payment of death taxes and administration expenses.
In Kansas, absent an expressed intent to the contrary, the burden of the federal estate taxes falls upon the residuary estate. Dittmer v. Schmidt, 235 Kan. 697, 701, 683 P.2d 1252 (1984). In contrast, absent a direction to the contrary, Kansas inheritance taxes are to be paid from the assets of the estate so that each distributive share bears an equitable proportion of such taxes. K.S.A. 79-1564(d); Wendland v. Washburn University, 8 Kan. App. 2d 778, 779, 667 P.2d 915 (1983). These rules do not come into play in the instant case because of Joyce Evans Pickrell’s express directions regarding death taxes and expenses.
Furthermore, the language of the trust indenture and amendment are plain and unambiguous. The amendment to section 12 of article IV of the trust instrument directs the trustees to pay to the estate the trust’s proportionate share of estate and inheritance taxes and administration expenses.
Generally, inter vivos trusts, as part of a coordinated estate plan, may include a provision instructing the trustee to pay the trust’s ratable share of the death taxes and expenses. See Nothern and Wachter, The Ultimate Burden of the Federal Estate Tax in Kansas-A Dilemma for Executors, 17 Washburn L.J. 231, 244-49 (1978). Notably, K.S.A. 79-1564(d), which provides that each distributive share of estate assets will bear a proportionate share of the inheritance taxes, permits the decedent to avoid this statutory scheme by so directing in either a will or a trust agreement.
Here, read separately, both the will and the trust indenture, as amended, are unambiguous and, therefore, do not require this court to resort to judicial construction to determine the decedent’s intent. The will charges the executors to pay death taxes and expenses from the residuary estate and not to collect any of the taxes and expenses from any of the beneficiaries under the will. Meanwhile, the trust amendment directs the trustees to pay to the estate the trust’s proportionate share of the taxes. Although better drafting could have made these provisions appear more coordinated, they are essentially consistent with one another.
The language of the will does not prohibit the executors from accepting the trustees’ proffer of the trust’s proportionate share of taxes and expenses. Instead, except for the residuary estate, the executors are prohibited from charging any trust beneficiary for taxes and expenses. This prohibition does not render the estate unable to accept the funds paid by the trustees pursuant to the amended trust instrument. Following the testator’s intent as stated in both the will and trust instrument does not produce an inconsistency.
Moreover, even if there is a perceived inconsistency, the trust provision should be given effect because it is the later instrument and, thus, the most recent expression of the decedent’s intent. Under the Pickrells’ interpretation, the directions set forth in the trust amendment are ineffective and essentially meaningless. The problem with this position is that it requires the last clear statement of the decedent’s intent concerning taxes and expenses to be ignored. Such a result is not consistent with Joyce Evans Pickrell’s execution of a trust amendment five years after the execution of her will.
In summary, we believe the tax provisions of Joyce Evans Pickrell’s will and amended trust indenture unambiguously express her intent and are not inconsistent. Thus, the trustees, as directed by the amended trust instrument, may pay to the estate the trust’s proportionate share of estate and inheritance taxes and administration expenses.
In light of our determination above, we need not reach the remaining issues presented.
Affirmed. | [
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Abbott, C.J.:
The Kansas Department of Human Resources (KDHR) and the Kansas Department of Administration, Division of Personnel Services (DPS), appeal from the trial court’s reversal of the agency’s ruling on the job classification of Verne E. Mulford.
Verne E. Mulford was a Physical Plant Supervisor II for the State of Kansas, In 1985, DPS did a comprehensive classification study of some job classes. It was determined that there was a need to update class specifications. In phase II of the study, DPS reviewed 72 classes of mechanics, repairers, and operators.
Under the preliminary updated classification descriptions, Mulford was listed as a Physical Plant Supervisor II. As part of the standard procedure during the course of the study, after all positions were reassigned to the new proposed classes, the agencies were provided a printout of where the employees would be placed in the new class schedule. The various agencies then reviewed the printout to make changes.
In October 1986, Bud Pierce, the director of personnel services of KDHR received the printout from DPS that had the preliminary allocations for all of the Department’s positions that were involved in the Phase II study. Pierce also received the proposed class specifications for the new classes. Pierce was asked to review the preliminary allocations and make corrections or suggestions. Pierce found problems with five of the eleven KDHR positions. One of the positions was Mulford’s. It appeared to Pierce that the proposed class specification for the new Physical Plant Supervisor II did not fit Mulford’s position; rather, Mulford’s position fit the description of Physical Plant Supervisor I.
Pierce contacted Mulford’s supervisory personnel and reviewed the preliminary allocations and proposed class specifications. They recommended that Mulford be .classified as a Physical Plant Supervisor I. When the new printout came out, it listed Mulford’s position as Physical Plant Supervisor I under the new scheme.
Under his old classification as Supervisor II, Mulford’s salary range was 23. Under the new classification scheme as Supervisor I, Mulford’s salary range was 23. If he had been a Supervisor II under the new scheme, his salary range would have been 25.
Mulford attended “Tell the Governor” day for state employees and complained about his job classification. He was informed by the Governor’s office that an “on-site” reviéw of his job would be done by DPS to' determine the most appropriate classification. The review was done by Kenneth Otte and Lois Ryan, analysts for DPS. Mulford was allowed to present documentation to the analysts supporting his position.
After the on-site visit, both analysts independently analyzed the information and wrote up their reports; both found that Mulford should clearly be classified as a Physical Plant Supervisor I. DPS presented its final findings in a letter dated February 22, 1988, with the conclusion that Mulford was a Physical Plant Supervisor I. On March 23, 1988, Mulford filed a petition for judicial review in district court.
In his petition, Mulford argued that his job class was lowered without due process. KDHR and DPS filed a motion to dismiss, arguing that while there had been a reclassification of job titles, there was no change in salary and no damage. They also argued that the matter was not justiciable under the Kansas Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-601 et seq. Finally, they argued that, even if Mulford were damaged, back pay is not a proper remedy.
In his trial brief, Mulford argued that he had a property interest in his job, which cannot be infringed upon arbitrarily. He argued that the interest was in retaining the classification so as to achieve a pay gain and avoid the embarrassment of being placed in a lower job; that, although K.A.R. l-4-l(c) allows classification plans to be revised, the only basis for reclassification is a change in duties; and that K.A.R. l-l-l(c) requires a position-to-position study to be done to compare his duties to that of other employees to see if they are doing the same work.
KDHR argued that there is a difference between establishing a new classification system and reclassifying an employee under an existing system and that no showing of change of duties is needed when a new system is put in place. It also argued that a position-to-position review is unnecessary. The DPS generally made the same arguments.
The trial court reversed the agency action. It held that K.A.R. l-4-l(c) required that there be a change in the kind of work Mulford did for there to be a new classification. It also held that, based on K.A.R. l-4-l(a)(2), in order to reclassify an employee, a comparison had to be made between Mulford’s past and present duties and his duties versus other employees — a position-to-position study. The court said, “Otherwise, the State could arbitrarily assign different classifications to positions with identical duties.” The court ordered that Mulford be classified as a Physical Plant Supervisor II and granted him back pay for which he would have been entitled as a Supervisor II.
Now, as appellee in this court, Mulford asserts generally the same arguments: that reallocation must be based on substantial changes in the duties of the position; that a position-to-position study must be done; and that the trial court correctly awarded back pay.
KDHR argues that the district court erred in finding that the reallocation of petitioner’s position was arbitrary or capricious; that no change in duties is needed to reclassify under a comprehensive classification plan and no position-to-position study is required; and back pay is not a proper remedy. DPS generally makes the same arguments.
1. Position-to-Position Study
It is first necessary to determine what statutory and regulatory law governs. K.S.A. 75-2938(1) provides authority for classification and subsequent modification of the classification:
“[T]he director of personnel services, after consultation with the heads of state agencies or persons designated by them, shall assign each position in the classified service to a class according to the duties and responsibilities thereof. . . . After consultation with the director of the budget and the heads of state agencies or persons designated by them, the director shall recommend changes in classes from time to time, and such changes, when approved or modified and approved as modified by the governor, shall take effect on a date or dates specified by the governor.”
K.S.A. 75-3747(1) authorizes the secretary of administration to adopt rules and regulations to carry out the Kansas Civil Service Act. K.A.R. 1-4-1 sets forth the procedure to be followed in classification:
“(a) the director shall prepare the classification plan after ascertaining, in cooperation with appointing authorities and principal supervisory officials, the duties and responsibilities of all positions in the classified service.
“(1) The classification plan shall establish an appropriate title for each class, describe the typical duties and responsibilities of the positions in the class, and indicate the qualifications for performance of the duties of the class.
“(2) The classification plan shall be so developed and maintained that all positions substantially similar with respect to the kind, difficulty, and responsibility of work are included in the same class; . . . and that the same schedule of pay may be applied with equity to all positions in the class.
“(c) The classification plan shall be revised or amended whenever there are significant changes in organization, creation of a new classification, abolition of a classification, or change in the duties of responsibilities of a classification that make revision or amendment necessary.”
Under K.S.A. 75-2938 and K.A.R. 1-4-1, new classification plans may be established when needed. That is precisely what happened in this case.
The real question, then, is whether a position-to-position study must be carried out under K.A.R. 1-4-7 whenever an employee requests one. The trial court said yes.
The regulations do put emphasis on equal treatment. K.A.R. l-4-l(a)(2), quoted above, requires that similar positions be within a similar class. K.A.R. 1-1-1 sets forth the purposes of the personnel regulations:
“These regulations are intended to provide, a uniform, comprehensive, and effective system of personnel administration for the State of Kansas. To provide such a system of personnel administration:
“(c) Positions essentially alike shall be treated in a uniform manner in all personnel processes, and positions not so alike shall be treated with áppropriate recognition of the nature and extent of the differences between them.”
Mulford and the district court rely on these regulations for the proposition that, once an employee challenges his or her classification under a new classification scheme, a position-to-position study must be done. For this proposition, they cite Haneke v. Secretary of Health, Ed. & Welfare, 535 F.2d 1291 (D. C. Cir. 1976). Although Haneke concerns federal law and is not binding on this court, it does present similarities. In Haneke, the employee challenged his classification. The relevant statute at the time, 5 U.S.C. § 5101 (1970), provided:
“It is the purpose of this chapter to provide a plan for classification of positions whereby—
“(1) in determining the rate of basic pay which an employee will receive-
“(A) The principle of equal pay for substantially equal work will be followed; and
“(B) variations in rates of basic pay paid to different employees will be in proportion to substantial differences in the difficulty, responsibility, and qualification requirements of the work performed and to the contributions of employees to efficiency and economy in the service.”
Haneke argued that his job classification was too low and that a position-to-position study had to be done by the relevant commission when it reviewed his classification. The commission refused on the basis that such studies would be impossible to administer. The commission argued that comparison of the duties performed by an employee with the classification descriptions was sufficient.
The court held that, in order to attain the goal of equal pay for equal work, whenever an employee challenges his classification and can point to other employees who are doing the same work but receiving more pay, DPS must do a position-to-position study and be prepared to articulate the nature of the differences in the positions. The court held it was arbitrary and capricious not to do so under the facts of Haneke, 535 F.2d at 1298.
The Kansas Administrative Regulations do not use the phrase “equal pay for equal work.” K.A.R. l-4-l(a)(2) and K.A.R. 1-1-1(c) do emphasize the goal of treating similar positions similarly. By the express terms of K.A.R. 1-4-7, “In conducting the review, the director may review other positions as required.” (Emphasis added.) The language of this regulation is permissive and Haneke is not on point. The decision of whether to do a position-to-position study is within the discretion of the director.
The trial court erred as a matter of law in holding that a position-to-position study must be done. Here, a new classification system was being put into place. The various people who had dealt with reclassification were all aware of what functions the various classified employees were doing. A position-to-position study would have been redundant and unnecessary. The agency did not act unreasonably, arbitrarily, or capriciously in not doing a position-to-position study.
2. Substantial Evidence
The scope of review of agency actions is set forth in K.S.A. 77-621:
“(a) Except to the extent that this act or another statute provides otherwise:
“(1) The burden of proving the invalidity of agency action is on the party asserting invalidity;
“(c) The court shall grant relief only if it determines any one or more of the following:
“(7) the agency action is based on a determination of fact, made or implied by the agency, that is not supported by evidence that is substantial when viewed in light of the record as a whole, which includes the agency record for judicial review, supplemented by any additional evidence received by the court under this act; or
“(8) the agency action is otherwise unreasonable, arbitrary or capricious.”
The job descriptions for Physical Plant Supervisor I and Physical Plant Supervisor II contain substantial differences. The “distinguishing features” listed on the Physical Plant Supervisor II description are: “Differs from the Physical Plant Supervisor I class in which work involves supervision of skilled craft and trade workers in directing a small physical plant or a phase of a large physical plant.” The distinguishing features listed on the Supervisor I description are: “Differs from the Physical Plant Supervisor II class in which the work is primarily administrative as well as supervisory.”
These differences are unambiguous. Lois Ryan and Ken Otte visited Mulford on-site. They determined his job met the definition of a Supervisor I. The notes from the visit state, “The supervision of skilled workers is precisely what Mr. Mulford does. . . . Mr. Mulford’s job responsibilities involve only a small percentage of administrative duties. . . . [T]he two levels of administrators above Mr. Mulford perform primarily all the administrative duties, lessening the level of responsibility of Mr. Mulford.”
There is substantial evidence to support KDHR’s determination that Mulford is a Physical Plant Supervisor I and the trial court erred in reversing the agency.
By reason of the above, the remaining issues are moot.
Reversed. | [
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Per Curiam:
Letty L. Tucking appeals the district court’s dismissal of her personal injury action against the Board of County Commissioners of Jefferson County and Jefferson County (County) for Tucking’s failure to meet the notice requirements of K.S.A. 1989 Supp. 12-105b(d).
Letty L. Tucking fell on a sidewalk outside the Jefferson County Courthouse on October 8, 1986. On June 21, 1988, her lawyer sent the following letter to the Jefferson County Commission:
“June 21, 1988
“Board of Jefferson County Commissioners Oskaloosa, KS 66066
“Re: Letty Tucking, Date of Injuries, Oct. 8, 1986, Place, West side of Jefferson County Courthouse
“Dear County Commissioners:
“This will notify you that we have been retained to represent the client named above. All further communications concerning this case should be directed to our office. If you have liability insurance you should be certain that the injury is promptly reported to your insurance company and that a copy of this letter be furnished to them. If you do not have liability insurance, you should either contact me or have your attorney do so with the view to try and settle this matter without the necessity of expensive litigation.
“Sincerely,
“CHARLES M. TULEY LAW OFFICE, P.A.
“by-“Charles M. Tuley”
On October 6, 1988, 107 days after the notice was sent, Tucking filed a lawsuit in district court against the County. Her petition did not allege that she gave notice to the County pursuant to 12-105b. The petition was served on the County on October 10, 1988. The County answered on November 1, 1988, stating:
“5. For further and separate defense, these defendants allege that a condition precedent to suit is the filing of a claim pursuant to K.S.A. 12-105(b) [sic]. No such claim was filed by the plaintiff. As a consequence thereof this court lacks jurisdiction of plaintiff s suit and plaintiff s action should be dismissed.”
The County filed a motion to dismiss on December 8, 1988, alleging that Tucking failed to comply with 12-105b(d). The district court dismissed Tucking’s action, finding the letter sent June 21, 1988, failed to comply with the requirements of 12-105b(d).
K.S.A. 1989 Supp. 12-105b(d), enacted at L. 1987, ch. 353, § 9, establishes a uniform written notice requirement for any claim against a municipality which could give rise to an action under the Kansas Tort Claims Act, K.S.A. 75-6101 et seq. In determining whether the notice given meets the statutory requirements, we must determine legislative intent and construe the meaning of the statute. “Interpretation of a statute is a question of law.” Director of Taxation v. Kansas Krude Oil Reclaiming Co., 236 Kan. 450, 455, 691 P.2d 1303 (1984). “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.” Kennedy & Mitchell, Inc. v. Anadarko Prod. Co., 243 Kan. 130, 133, 754 P.2d 803 (1988). The appellate court’s review of questions of law is unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
K.S.A. 1989 Supp. 12-105b(d) provides, in part: “Any person having a claim against a municipality which could give rise to an action brought under the Kansas tort claims act shall file a written notice as provided in this subsection before commencing such action.” As Tucking correctly notes, 12-105b is not part of the Kansas Tort Claims Act, K.S.A. 75-6101 et seq. It appears under article 1, general 5 provisions, of chapter 12, cities and municipalities. The provision does apply to counties. K.S.A. 12-105a(a) broadly defines “Municipality” to include counties.
K.S.A. 1989 Supp. 12-105b(d) took effect July 1, 1987. From July 1979 until July 1987, there was no express requirement that notice be given to a governmental entity before suit was filed. In Quigley v. General Motors Corp., 647 F. Supp. 656, 661 (D. Kan. 1986), the court held that the then applicable subsections of 12-105b did not require tort victims to give notice of claims before filing suit against a municipality. Presumably, the legislature was responding to Quigley when it enacted K.S.A. 1989 Supp. 12-105b(d).
Prior to 1979 when it was repealed, a different notice requirement was found in K.S.A. 12-105. In some form that statute had been on the books since 1903. There were minor differences in statute number, which cities it applied to, and the time limits. The basic requirements remained the same until its repeal.
The only case interpreting 12-105b(d) is Stevenson v. Topeka City Council, 245 Kan. 425, 781 P.2d 689 (1989). The issue in the Stevenson case was whether the statute should be given pro spective or retrospective application. That issue has not been raised here.
The prior statutes, and the cases interpreting them, are the only evidence of legislative intent other than the words of 12-105b itself. The prior statutes and accompanying cases should be considered in interpreting K.S.A. 1989 Supp. 12-105b(d). “In determining legislative intent, courts are not limited to consideration of the language used in the statute, but may look to the historical background of the enactment.” Citizens State Bank of Grainfield v. Kaiser, 12 Kan. App. 2d 530, 536, 750 P.2d 422, rev. denied 243 Kan. 777 (1988).
The County argues that compliance with K.S.A. 1989 Supp. 12-105b(d) is mandatory. We agree. This is certainly the law as it was established in a long line of cases interpreting K.S.A. 12-105 and its predecessors. For instance, in Cook v. Topeka, 75 Kan. 534, 536, 90 Pac. 244 (1907), the court said: “The statute requiring a statement to be filed with the clerk is mandatory; that is, no action can be maintained until such statement is filed. ”
In fact, K.S.A. 12-105 was interpreted to be a condition precedent to filing suit. In Hibbs v. City of Wichita, 176 Kan. 529, 532-33, 271 P.2d 791 (1954), the court said:
“This court has always recognized the power of the legislature to enact a statute establishing conditions precedent to the maintenance of an action against a city for damages to person or property and long ago, in construing 12-105, . . . determined that its provisions established conditions precedent to the bringing of such an action which must be pleaded . . . .”
See, e.g., James v. City of Wichita, 202 Kan. 222, 447 P.2d 817 (1968).
Because K.S.A. 1989 Supp. 12-105b(d) creates a condition precedent, at trial both parties bore special burdens in pleading. K.S.A. 1989 Supp. 60-209(c) provides: “In pleading the performance or occurrence of conditions precedent, it is sufficient to aver generally that all conditions precedent have been performed or have occurred. A denial of performance or occurrence shall be made specifically and with particularity.” Tucking did not plead the occurrence of the condition precedent in her petition, although that specific issue was not raised by the County. The County did deny the occurrence of the condition both in its answer and in its motion to dismiss. In her memorandum in opposition to the motion to dismiss, Tucking alleged compliance with the notice requirement and attached the letter as an exhibit. The district court, however, did not rely on Tucking’s failure to plead compliance. The court found there had not been substantial compliance with 12-105b(d). It is necessary then to determine the limits of substantial compliance.
In interpreting the prior statutes, courts have always:found a plaintiff need not do more than substantially. comply with the elements. For instance, in Cook v. Topeka, 75 Kan. at 536, the court said: “[W]ith respect to the details of the . statement precise exactness is not absolutely essential. If it reasonably complies with the statute, and the city is not misled to its .prejudice by any defects of description of the place where the accident happened, the city has no reason to complain.”
Substantial compliance is what is required under the current notice statute. K.S.A. 1989 Supp. 12-105b(d) now expressly provides, “In the filing of a notice of claim, substantial compliance with the provisions and requirements of this subsection shall constitute valid filing of a claim.” By expressly mentioning “substantial compliance” in the statute, we understand the legislature to be codifying prior case law.
Decisions interpreting predecessors to 12-105b have been fairly strict in determining the minimum requirements for notice, despite language about substantial compliance. For instance, in McHenry v. Kansas City, 101 Kan. 180, 165 Pac. 664 (1917), the court found notice that gave an improper date to be defective. The notice listed the date of injury as January 12, 1916, but the petition gave the date of injury as January 19, 1916,. The court said: • . •. , . , , , .
“The statement requires that the time of the accident be given. This is only fair. The city should have an opportunity to investigate: the facts, and merits of the claim, and to prepare its defense against demands which are false, frivolous or extravagant. For the purpose of such an investigation an accurate statement of the time is material and important. It is an element of substance and not of mere form in the making of the statement required by the statute.” 101 Kan. at1 182. ...
The County argues that McHénry, and other cases, provide a rule that there is no substantial compliancé if one element is completely missing — that there can only be substantial cornpliáhce if the plaintiff makes an attempt to state each element of the notice. This is a correct interpretation of the cases under prior statutes. For instance, in Haggard v. Arkansas City, 116 Kan. 681, 682, 229 Pac. 70 (1924), the plaintiff did not designate where in the city the accident took place, and the court said: “Here there was not even an effort made to comply with the requirement of the statute as to the place where the injuries were received, hence the statement is fatally defective.” In Wildin v. City of Hutchinson, 177 Kan. 671, 282 P.2d 377 (1955), overruled on other grounds 204 Kan. 179, 460 P.2d 541 (1969), the plaintiff did not include either the date or place of injury. In holding that the trial court was correct in ruling the notice to be insufficient, the court said: “There is close analogy between failure to file any statutory statement, and failure to file a statement setting forth an essential requirement.” 177 Kan. at 677.
The elements of a K.S.A. 1989 Supp. 12-105b(d) notice are listed in the statute:
“(1) The name and address of the claimant and the name and address of the claimant’s attorney, if any; (2) a concise statement of the factual basis of the claim, including the date, time, place and circumstances of the act, omission or event complained of; (3) the name and address of any public officer or employee involved, if known; (4) a concise statement of the nature and the extent of the injury claimed to have been suffered; and (5) a statement of the amount of monetary damages that is being requested.”
Earlier statutes required less. Generally, they required only the following: (1) the time and place of the accident, (2) the circumstances, and (3) a demand for settlement and payment. See K.S.A. 12-105 (Weeks 1975).
In this case, Tucking’s notice entirely neglected two elements. The notice made no reference to either the amount of monetary damages Tucking claimed or the type of injury she suffered. Her compliance with the other elements was partial. As to element (1), the notice did not contain her address. As to element (2), the notice did not give the time of the accident or describe the circumstances of the injury. Element (3) does not apply to this case. Because case law applies to the current statute, Tucking’s notice is inadequate on either element (4) or (5), and probably on elements (1) or (2) as well.
Tucking’s main argument is that she fulfilled the purpose of the statute — she gave the city notice so that it had an opportunity to investigate her claim. Tucking cites City of Lenexa v. City of Olathe, 233 Kan. 159, 164, 660 P.2d 1368 (1983), an annexation case, for the proposition that, in general, the term “[substantial compliance” means “compliance in respect to the essential matters necessary to assure every reasonable objective of the statute.” Although there is no express evidence of legislative intent regarding K.S.A. 1989 Supp. 12-105b(d) other than the words of the statute itself, prior statutes were interpreted to have the purpose suggested by Tucking. In Holmes v. Kansas City, 101 Kan. 785, 786, 168 Pac. 1110 (1917), the court said: “The notice effected the purpose of the statute, which is to inform the city of the accident and of the defect which causes an injury, and to give the city an opportunity to ascertain the character and extent of the injury sustained.”
Holmes should not be interpreted as holding that the required elements of the notice do not need to be stated. In Holmes, the notice, which was quite detailed, contained a minor inaccuracy regarding the accident location. The court was merely saying the minor inaccuracy did not matter because the purpose of the statute was served — that there was substantial compliance.
Tucking argues that Holmes applies to her situation. The notice in Holmes was detailed and the plaintiff made an attempt to state all of the required elements. Tucking’s notice did not. Tucking’s position is at variance with prior case law. In the past, under the predecessor statutes to 12-105b, pleadings were required to conform to the notice, and the terms could not be varied. See Adams v. City of Arkansas City, 188 Kan. 391, 397, 362 P.2d 829 (1961); Watkins v. City of El Dorado, 183 Kan. 363, 366-67, 327 P.2d 877 (1958). This requirement still exists under K.S.A. 1989 Supp. 12-105b(d) and would be effectively abrogated if plaintiffs were allowed to provide only minimal information in their notices. We hold that Tucking’s notice was not in substantial compliance with K.S.A. 1989 Supp. 12-105b(d). The trial court correctly dismissed the case.
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Abbott, C.J.:
American States Insurance Company (American) filed a declaratory judgment action, following a workers compensation case, against Hanover Insurance Company (Hanover). The trial court denied Hanover’s motion to dismiss the case for lack of jurisdiction, and this court granted an interlocutory appeal.
In the workers compensation case, an injured workman, Robert C. Miller, filed a claim against both J.G. Shull Co. (Shull), who is insured for workers compensation purposes by American, and A.F. Byers & Co. (Byers), which is insured for workers compensation purposes by Hanover. Since Shull and Byers are no longer parties and their insurance carriers stand in their shoes, Shull and American will be referred to as American, and Byers and Hanover will be referred to as Hanover.
The Administrative Law Judge (ALJ) issued a preliminary order for American to pay the claimant’s medical and temporary total disability compensation. The ALJ specifically reserved the question of any liability of Hanover.
American then made a compromise settlement of the workers compensation claim for $44,625.37. Prior to the settlement, American filed a declaratory judgment action seeking a declaratory judgment that Hanover is liable for past and future benefits paid and alleging that the Division of Workers Compensation “lacks the power to determine and fix a comparative degree of liability” between American and Hanover.
We are furnished a meager record on appeal, which consists of the petition for declaratory judgment, the journal entry denying the motion to dismiss (which contains no findings or conclusions and gives no clue as to the trial court’s reasons for denying the motion), Hanover’s motion to dismiss, and a one-paragraph memorandum in support of the motion to dismiss. The record also contains a second motion to dismiss and the trial court’s bench notes. Appellant has attempted to supplement the record in the appendix to the brief. Appendices to a brief are not a substitute for a record. See In re Appeal of News Publishing Co., 12 Kan. App. 2d 328, 333, 743 P.2d 559 (1987). The record furnished makes it very difficult to review the case. We cannot tell from the record whether a workers compensation claim is still pending against Hanover, although at oral argument we were assured the workers compensation case was concluded and that there is no pending claim. We have some difficulty determining what the trial court decided.
Hanover filed a motion on November 22, 1988, requesting dismissal of American’s petition “for the reason that this Court lacks subject matter jurisdiction over the action and that plaintiff has failed to exhaust its administrative remedies.” A one-page memorandum citing two federal cases and one Kansas Supreme Court case accompanied the motion. The trial court heard argument and deferred its decision “pending decision of Administrative Law Judge.” Presumably, the benchnote entry refers to the workers compensation case. The record contains nothing concerning the workers compensation claim after that date. Both briefs contain copies of various documents in their appendices that show the workers compensation claim was settled, but indicate a workers compensation claim was still pending against Hanover when Hanover filed a second motion to dismiss American’s petition.
In its second motion to dismiss, American claimed it had filed a Form 12 “Worksheet for Settlement” in the workers compensation case admitting Shull was the employer and American the insurance carrier and that the admission mooted the declaratory judgment action. A copy of the Form 12 is attached to the motion and is part of the record before us.
The trial court then denied the motion. The journal entry denying the motion to dismiss states, in pertinent part, “that defendant’s motion to dismiss plaintiffs petition on the ground that the issue of which carrier extends coverage for the respondent in the workers compensation claim [is] not within the jurisdiction of the district court should be and is hereby overruled.”
On appeal, Hanover makes three arguments: (1) The ALJ had the power to decide the identity of the claimant’s employer; (2) by settling with claimant, American waived any rights it had to have the ALJ decide the issue of who the employer was and; (3) the declaratory judgment action should have been dismissed for failure to exhaust administrative remedies.
American responded that the district court, and not the workers compensation proceeding, is the proper forum to litigate “as the rights of the claimant are not at issue. ” American argued on appeal that it. reserved all rights and claims to proceed with an independent action to determine liability and apportionment between the parties. The problem with this argument is that, if we assume American could reserve the right to an independent order, there is nothing in the record before us to show American did so. (The appendix to American’s brief, has material that, if it were in the record, would do so.)
American also argues it had exhausted all administrative remedies and that, since Hanover did not raise waiver in the trial court, the issue of waiver cannot be raised for the first time on appeal.
At oral argument, American argued that the issue in the workers compensation case was who the employer was. That issue is not a coverage question, but rather a fact question. Hanover responded that our Kansas Supreme Court has allowed questions concerning borrowed servants and other employer questions to be litigated separately.
Hanover’s argument rests on a principle stated in Larson’s treatise on workers compensation law. Where the rights of the claimant turn on a question involving insurance, most states have determined that the workers compensation division has jurisdiction to resolve the question; however, “when the rights of the employee in a pending claim are not at stake, many commissions disavow jurisdiction and send the parties to the courts for relief. ” 4 Larson’s Workmen’s Compensation Law § 92.42 (1990). There is a long line of cases in Kansas concerning such issues.
The earliest case of significance for this appeal is Attebery v. Griffin Construction Co., 181 Kan. 450, 312 P.2d 598 (1957). Attebery involved a workers compensation case filed by a deceased worker’s estate against two employers and their insurance carriers. The claimant moved to dismiss one employer and its carrier, believing that employer was a general contractor, and continued against its immediate employer (the alleged subcontractor). The motion was granted over, the subcontractor’s objection. The Kansas Supreme Court held that, although K.S.A. 44-503 allows a general contractor to implead a subcontractor, it does not allow a subcontractor to implead a general contractor; therefore, a claimant may dismiss a respondent and . continue against the other so long as it demonstrates the latter to be a subcontractor. 181 Kan. at 456-57.
The court also stated the following:
“By this appeal U.S.F. & G. [the insurance carrier for the subcontractor], who was a party to the proceedings before the Workmen's ■ Compensation Commissioner, seeks to draw in another respondent and its insurance carrier and litigate rights, not relative to the obligation of U.S.F. & G. on its own policy to the respondent, Griffin, or the claimant, but its rights against the other insurance carrier. We are of the opinion that this is not only contrary to the spirit of the Workmen’s Compensation Act but also contrary to the intention of the legislature in applying the Act which is designed primarily for the protection of the injured workman or his.dependents.” 181 Kan. .at 460.
The Attebery court held the Act contemplates an independent civil action for indemnity and subrogation between the insurance companies under the circumstances there presented. 181 Kan. at 460.
In United States Fidelity & Guaranty Co. v. Maryland Cas. Co., 186 Kan. 637, 638, 352 P.2d 70 (1960), the insurance company for the subcontractor in Attebery sued the insurance company for the general contractor in Attebery to recover the workers compensation benefits it was required to pay as a result of the Attebery holding. The insurance carrier demurred, and the district court dismissed. In reversing, the Supreme Court held, in part, that Attebery expressly allowed for such a suit. Further, it held the finding by the workers compensation division in Attebery as to who was the subcontractor was not res judicata as between the parties because the alleged general contractor and its insurance carrier were not parties to that suit (they had been dismissed). 186 Kan. at 645-46. The relationships of the parties in Attebery, therefore, could be litigated in the second suit. 186 Kan. at 646.
At first blush, Attebery and Maryland Cas. Co. might appear to clearly allow an action like the present one. Hanover, however, cites a number of subsequent cases, which it takes to stand for the proposition that all determinations of employee-employer status must be made by the workers compensation division rather than the district court. A review of these cases, in light of the two principles stated above, demonstrates they may be read harmoniously with Attebery and Maryland Cas. Co. and that the district court has jurisdiction in this case.
The first case cited by Hanover is Atwell v. Maxwell Bridge Co., 196 Kan. 219, 409 P.2d 994 (1966). The claimant brought a workers compensation claim against the general contractor, who then impleaded the subcontractor on the ground that the subcontractor, as a subcontractor, was claimant’s immediate employer (pursuant to K.S.A. 44-503). 196 Kan. at 220. The director affirmed the finding that the general contractor was claimant’s employer, the dismissal of the subcontractor, and the award of claimant’s benefits. 196 Kan. at 220. The district court reversed, holding the general contractor to be liable as a general contractor with the right to recover from the subcontractor for any payments made. 196 Kan. at 220-21. On appeal to the Kansas Supreme Court, the award to claimant was not in dispute; the only issue was the liability between the general contractor and the subcontractor. 196 Kan. at 220. The Supreme Court affirmed. 196 Kan. at 227.
Hanover argues Atwell demonstrates that the appropriate procedure for multiple respondents to litigate the question of who is the employer is in the workers compensation division, not in a separate district court action. Although Atwell may appear to be inconsistent with Attebery and Maryland Cas. Co., it is consistent. In Attebery, there was no statutory basis for allowing a subcontractor to implead a general contractor. The action between the insurance companies would have allowed them to litigate their interests without the claimant’s interest being significantly at stake in the workers compensation setting without express authority in the Act to do so.
In Atwell, however, because the Act allowed the named respondent, as a general contractor, to implead an alleged subcontractor, the insurance companies were allowed to litigate their respective liability in the workers compensation division. To have done otherwise would have been against the express language of the Act. The three cases together stand for the proposition that insurance companies may litigate their relative liabilities in workers compensation cases in situations where the claimant’s intérests are not at stake only where expressly allowed under the Act.
The interpretation of the above three cases is strengthened by the next case cited by Hanover: Hobelman v. Krebs Construction Co., 188 Kan. 825, 366 P.2d 270 (1961). Hobelman was a workers compensation case in which the claimant’s recovery was not an issue on appeal, but the relative liability of the alleged employers and their insurance carriers was an issue.
The dispute primarily concerned the relationship of the two alleged employers: were they general contractor and subcontractor, or were they general employer and special employer? 188 Kan. at 828. If the borrowing employer has the right to exercise control over the loaned employee, the loaning employer is described as the general employer and the borrowing employer as the special employer. See Mendel v. Fort Scott Hydraulic Cement Co., 147 Kan. 719, 724-27, 732, 79 P.2d 868 (1938). Although the Workers Compensation Act does not make the general-special employer distinction, the Supreme Court has previously decided that, where a loaned employee is injured and both employers retained the right of control, they are jointly and severally liable and the employee may sue either or both. See Mendel, 147 Kan. at 724-27, 732.
The Hobelman court held the two employers to be general and special, respectively, but refused to decide the collateral issue of the degrees of liability of the parties because the Act fails to provide for such a determination. 188 Kan. at 829-30. In support of this conclusion, the court stated:
“In the absence of a specific statute to the contrary, such as G.S. 1949, 44-503, we are in accord with the statement made in the case of Johnson v. Mortenson, 110 Conn. 221, 147 Atl. 705, as follows:
‘. . . The better view and practice of compensation commissioners appears to have been to regard their jurisdiction as limited to determination of the right of the employee to compensation and as to who is liable therefor to such claimant, leaving the rights and liabilities between those held jointly liable to the claimant to “be worked out in such proceedings, among themselves, as may be brought for the purpose.” ’ ” 188 Kan. at 832-33.
The Hobelman decision, therefore, rests on the same principle derived from Atwell, Attebery, and Maryland Cas. Co. above: Unless specifically allowed by statute, insurance companies may not litigate in the workers compensation division their respective liability for an award if the employee’s interests are not at issue.
Hanover also cites Drennon v. Braden Drilling Co., Inc., 207 Kan. 202, 483 P.2d 1022 (1971), as an example in which an employment determination, challenged on appeal, originated in the workers compensation division rather than in a separate civil action. Drennon, however, concerned the question of whether a claimant could dismiss one of the respondents originally named over the objection of the other respondent. It was reasonable to decide whether the workers compensation division had the power to allow such a dismissal in a workers compensation case. Drennon is not authority for the proposition that any party would have standing to raise such an issue in district court. The present issue is different, as the above cases demonstrate. Insurance, carriers have standing to litigate among themselves in district court their relative liability of a workers compensation award.
The last case heavily relied on by Hanover is Clouston v. Board of Johnson County Comm'rs, 11 Kan. App. 2d 112, 715 P.2d 29 (1986). Again, Hanover argues Clouston demonstrates that the appropriate forum for determining which respondent is the liable employer is the workers compensation division. Clouston, however, is a dilferent class of case from the above cases and is distinguishable from the present case.
In Clouston, the claimant filed a workers compensation claim against two respondents — the general contractor and the subcontractor. The claimant won the award in the workers compensation division against the general contractor, who was found to be the employer; the subcontractor was found not to be an employer and not liable. The district court reversed, finding the subcontractor to be the employer, and this court reversed again, finding the general contractor to be the employer. The subcontractor had paid about $7,000 in benefits before this court reversed, so it moved for, and was granted, restitution from the general contractor by the administrative law judge. The district court reversed, holding the workers compensation act does not allow such an order, and this court, on a second appeal, affirmed the district court. 11 Kan. App. 2d at 114-15. The legislature subsequently provided statutory authority for such a restitution order in K.S.A. 1989 Supp. 44-556(e).
Hanover relies on the first appeal in Clouston as an indication that the issue of which respondent is the employer is properly to be decided by the workers compensation division and not the district court. Clouston is distinguishable from the present case, as well as the other cases relied on by Hanover, in that both respondents were claiming it was not the claimant’s employer. Under such circumstances, it is theoretically conceivable that both could be correct and claimant’s award would have to be reversed. Clouston, therefore, does not stand for the general principle that where the claimant’s interests are not at stake the insurance companies cannot litigate their relative liabilities in the workers compensation division (and thus the question of whether the facts of Clouston constitute an express statutory exception to that principle is inappropriate). Clouston is distinguishable from the pres ent case for the same reason. Shull admitted for purposes of the settlement that it was Miller’s employer and thus Miller’s interests could not have been at stake on appeal from the workers compensation division.
The present case does not fit the exception to the general principle disclosed in the above cases; therefore, it was properly brought in the district court. As just noted, Miller’s interests were no longer at stake once he settled with Shull. Thus, unless the workers compensation act expressly allows the employers and insurance companies to litigate their relative liability in the workers compensation division, they may not. Neither party has cited a section which provides an applicable exception in this case. K.S.A. 44-503 is inapplicable in the present case because, at least in the briefs and the limited record before us, neither party has argued that one of them is a general contractor and the other a subcontractor.
Hanover also argues American’s suit is precluded because American failed to' exhaust administrative remedies as required by K.S.A. 77-612. This argument was expressly rejected by the Kansas Supreme Court in Maryland Cas. Co. as the requirement to exhaust administrative remedies was interpreted tó apply only to the claimant’s attempts to recover compensation. Maryland Cas. Co., 186 Kan. at 642. In the present case, Miller exhausted his remedies when he settled.
Hanover also argues American waived any right to assert that Byers was the employer when Shull settled With Miller, This issue is not within the issue certified for interlocutory appeal. The district court’s order denying Hanover’s motion to dismiss states ‘‘defendant’s motion to dismiss plaintiffs petition on the ground that the issue of which carrier extends coverage for the respondent in the worker’s compensation claim [is] not within the jurisdiction of the district court should be and is hereby overruled.” The court then certified that issue for interlocutory appeal. Further, the issue stated in Hanover’s application for permission to take' an interlocutory appeal stated the issue to be that of the district court’s jurisdiction.
Shull’s settlement may indeed result in its having waived the right to allege it was not an employer of Miller and may, therefore, provide Hanover with a waiver defense. But, such a defense is not jurisdictional in nature and is not before us. The issue was not raised in the trial court and was not certified for interlocutory appeal; thus, we will not consider it.
The trial court did not err in denying Hanover’s motion to dismiss.
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Gernon, J.;
Gerry L. Marshall appeals the trial court ruling concerning the duty of an insurance agent when a policyholder cancels an insurance contract and purchases another policy from a different company, thus affecting the underlying coverage requirements of an umbrella liability policy.
Dr. and Mrs. Philip Wolfram purchased an umbrella liability policy, issued by St. Paul Fire & Marine Insurance Company, through the Miller-Donnelli Agency, Inc. This liability policy had a limit of $1,000,000 and required the insured to have underlying automobile liability coverage of $250,000 for bodily injury for each person. The requirements of underlying coverage were clearly stated in the policy and on the front page of the renewal declaration.
The Miller-Donnelli Agency also sold the Wolframs an automobile liability policy issued by Western Casualty & Surety Company, which had policy limits of $250,000 for bodily injury for each person.
On September 24, 1985, Mrs. Wolfram, responding to solicitations received in the mail, applied for an automobile liability insurance policy from Wausau Underwriters Insurance Company. On the same day, she called the Miller-Donnelli Agency and told an agent that Wausau had quoted her a price for “identical coverage” which cost $200 less for a six-month period than the insurance purchased through the Miller-Donnelli Agency and that she wanted to cancel the Western automobile policy. The agent persuaded her to let the policy lapse instead of cancelling it. He did not ask Mrs. Wolfram what she meant by “identical coverage.” The umbrella liability policy was not discussed in this telephone conversation.
On October 13, 1985, Mrs. Wolfram sent the Miller-Donnelli Agency a note asking that all of the Wolfram’s automobile insurance be cancelled as of that date because they had other coverage dating from September 28, 1985. On October 14, 1985, she called the agency and left a message to cancel the insurance on all their automobiles. The Miller-Donnelli Agency complied and cancelled the Western automobile policy.
The automobile liability policy obtained by the Wolframs from Wausau had policy limits of $100,000 for bodily injury for each person. This policy plainly did not satisfy the requirements of the umbrella liability catastrophe policy, and left a gap in coverage of $150,000.
On October 30, 1985, Dr. Wolfram and Sandra Marshall, Gerry Marshall’s wife, were killed in an automobile collision. Gerry Marshall filed suit against the estate of Dr. Wolfram. The parties and insurance companies entered into a settlement agreement. Wausau paid $100,000 to Marshall in lull satisfaction of its obligation. Judgment was entered in the amount of $361,000. Of this amount, St. Paul paid $111,000 and agreed to make future payments with a present value of $100,000. The gap of $150,000 was left unsatisfied, and Marshall agreed not to make any attempt to collect it from Wausau or St. Paul. The estate of Dr. Wolfram had no assets to satisfy the $150,000 judgment. Marshall signed a covenant not to execute against Dr. Wolfram’s estate and was assigned all rights and causes of action which the estate may have against the Miller-Donnelli Agency, Carl Donnelli, their agents, servants or employees, and their insurance carriers.
Marshall then filed the present action against Carl Donnelli and the Miller-Donnelli Agency alleging that the agency had negligently cancelled the Western automobile liability policy without ascertaining that the other coverage obtained by the Wolframs would comply with the requirements of the umbrella liability catastrophe policy. Marshall also alleged that the agency had breached its contract to procure and maintain the umbrella policy and all underlying required policies. The district court sustained a motion for summary judgment filed by Donnelli and the MillerDonnelli Agency, finding that the agency did not owe a duty to the Wolframs to inquire whether their new automobile policy was compatible with their umbrella policy when the Wolframs did not seek any advice. We agree.
The issue is whether an insurance agency has an affirmative duty, when it is told to cancel an automobile policy, to check as to whether a new automobile policy purchased from another agency meets the terms of an umbrella policy for minimum underlying coverage requirements.
Marshall cites several cases which he claims establish that the agency owed a duty to the Wolframs to ascertain that their new policy had the required limits before cancelling their automobile policy. However, we conclude that none of the cases cited by Marshall is similar to the present case, and the cases cited do not establish any such duty. The cases cited by Marshall involve situations where an agency procured an underlying policy which did not meet the coverage requirements of an umbrella policy also procured by the agency. In the present case, the MillerDonnelli Agency properly procured the policies it handled. The Miller-Donnelli Agency had no connection with the Wausau policy.
A Kansas case cited by Marshall, Keith v. Schiefen-Stockham Insurance Agency, Inc., 209 Kan. 537, 498 P.2d 265 (1972), is also distinguishable from the present case in that it recognizes the duty of a broker or agent to procure insurance for another. This is not a procurement case and therefore Keith is not applicable.
A case which is directly on point is Blonsky v. Allstate Ins., 128 Misc. 2d 981, 491 N.Y.S.2d 895 (Sup. Ct. 1985). In Blonsky, the plaintiff had dealt with one insurance broker for 28 years and had in effect a $1,000,000 umbrella policy which required underlying automobile liability coverage of $300,000, and an Aetna automobile insurance policy with a limit of $300,000. The plaintiff obtained a new primary automobile insurance policy with limits of $100,000 from another broker and cancelled the Aetna insurance policy with the $300,000 limit. The plaintiff was later involved in an automobile accident and discovered that there was a $150,000 gap in his insurance coverage. He sued his original insurance broker to recover the amount of the gap. The New York court found that the broker had no continuing duty to advise and guide the insured after the broker had properly obtained the insurance requested.
The ruling of the New York case appears to be fair and reasonable, and we adopt its logic and reasoning. Kansas courts also have commented on the limited role of the insurance agent and the strict requirement for consideration to exist before there is a specific contractual duty on the part of an agent. Marker v. Preferred Fire Ins. Co., 211 Kan. 427, 431-33, 506 P.2d 1163 (1973). There is simply no support for the duty Marshall argues ought to be imposed on an insurance agent or broker.
Although not raised by the parties, we note that the case of Heinson v. Porter, 244 Kan. 667, 772 P.2d 778 (1989), may also be applicable to this case. Heinson primarily concerned wrongful conduct on the part of an insurer and a judgment in excess of the policy limits; however, the Kansas Supreme Court also discussed assignment of claims and agreements releasing the original holder of the claim from liability. The language of Heinson appears to indicate that there can be no recovery on an assigned claim when the party from whom the claim was assigned has been released from liability and from the possibility of actual damages through a covenant not to execute or similar agreement. 244 Kan. at 675-77. Under this reasoning, the Miller-Donnelli Agency would not be liable to Marshall because the Wolfram estate is no longer liable to Marshall.
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Abbott, C.J.:
This is a direct appeal by Kenny Rabe from his conviction for driving under the influence of alcohol (DUI). Rabe was convicted in the Municipal Court of Dodge City, Kansas, and appealed that conviction to the District Court of Ford County, Kansas. This appeal arises as a result of the trial court’s refusal to dismiss the case because Rabe was not brought to trial within the 180-day limit required by K.S.A. 22-3402(2).
Rabe filed a timely notice of appeal in the district court on February 25, 1988. On that same day, he executed an appeal bond that was approved by the municipal court judge and filed in the district court. A certificate of service was filed showing service by regular mail on the city attorney who prosecuted the case, as well as the municipal court judge who tried the case and approved the appeal bond and the clerk of the municipal court. The appeal was docketed and a case number was assigned. The appeal languished on the docket for some 14 months, at which time counsel for Rabe filed a motion to dismiss the case because he had not been brought to trial within the 180 days mandated by K.S.A. 22-3402(2). K.S.A. 22-3402(2) provides:
“If any person charged with a crime and held to answer on an appearance bond shall not be brought to trial within one hundred eighty (180) days after arraignment on the charge, such person shall be entitled to be discharged from further liability to be tried for the crime charged, unless the delay shall happen as a result of the application or fault of the defendant, or a continuance shall be ordered by the court under subsection (3).”
Rabe was brought to trial some 17 months after the notice of appeal was filed.
The city attorney and municipal court clerk denied they received copies of the notice of appeal. The trial court appears to have held counsel for Rabe had mailed the notice of appeal, but it was not received. The trial court then reasoned:
“5, That since the statute K.S.A. 22-3609(3) states that the defendant shall cause notice of appeal to be served upon the City Attorney prosecuting the case and the City attorney did not receive the mailed notice pursuant to the Certificate of Service filed by defense attorney Leslie A. Phelps, that the appeal is not properly docketed, as defense attorney should have used certified mail service or personal service of process by the Sheriff.”
Rabe relies solely on the right to a speedy trial as provided by K.S.A. 22-3402(2). He does not raise ds an issue a claim that he was denied his constitutional right to a sp'éedy trial, nor did he do so in the trial court. For those interested in the distinction between the statutory and constitutional right to a speedy trial, see Barker v. Wingo, 407 U.S. 514, 33 L. Ed. 2d 101, 92 S. Ct. 2182 (1972); State v. Rosine, 233 Kan. 663, 668-70, 664 P.2d 852 (1983); State v. Taylor, 3 Kan. App. 2d 316, 321, 594 P.2d 262 (1979).
. Only one case is cited by the parties and both sides rely on that case to support their respective positions. Rabe interprets City of Overland Park v. Fricke, 226 Kan. 496, 601 P.2d 1130 (1979), to hold that when an appeal from a municipal court conviction is properly filed and a notice of appeal mailed to the city attorney, the accused has done what he or she is required to do by statute, and the statutory speedy trial period commences to run. The City, in its two-page bi-ief,. argues that, while Fricke places the obligation upon the City to docket an appeal in a timely fashion, in this case, since the City, did not receive' notice of the appeal being filed, the time limitations of the speedy trial statute did not commence to run( until there was actual notice to the city, attorney.
Historically, the duty to prosecute a case rested with the prosecution. That view has been modified, and the trial judge now also.has. responsibility for management of the trial calendar. Obviously, the prosecution also has at least an equal duty to see that an accused is not denied a speedy trial.
. In State v. Higby, 210 Kan. 554, 502 P.2d 740 (1972), our Supreme Court held that the obligation to bring a defendant to trial within the time. limitations provided by the speedy trial statute is on the State and the defendant is not required to take any affirmative action.. The court went on to hold:
“Only the state is empowered to bring a criminal charge to trial; hence the duty of procuring prompt trial rests upon the state (see ABA Standards, Speedy Trial, Approved Draft, 1968, § 2.2, p. 17); however, the ultimate responsibility for management of the trial calendar- is in the trial court (ibid., § 1.2, pp. 11-12; ABA Standards, The Function of the Trial Judge, Tentative Draft, § 1.1 (a), pp. 25-26; § 3.8, 'pp. 48-49).” 210 Kan. at 556. .
Our dilemma in this appeal arises because of three cases decided before the statutes permitted notice of. appeal from ‘ municipal courts to be filed directly in the district court. The results reached in those cases appear to us to be inconsistent with a second line of cases dealing with misdemeanor criminal cases commenced in the district court. The three cases involving appeals from a municipal court are City of Elkhart v. Bollacker, 243 Kan. 543, 757 P.2d 311 (1988); City of Garnett v. Zwiener, 229 Kan. 507, 625 P.2d 491 (1981); and City of Overland Park v. Fricke, 226 Kan. 496.
In Fricke, the Supreme Court affirmed the trial court’s dismissal of a case for denial of a statutory speedy trial. Fricke was convicted in the municipal court. He perfected an appeal. At that time, notices of appeal were filed in the municipal court. Fricke appeared in the district court at a docket call and announced he was maintaining his not guilty plea and wanted a trial. Some eight months later, the trial judge dismissed the case for failure to bring the defendant to trial within the 180-day limit required by K.S.A. 22-3402(2). The city argued on appeal that the speedy trial statute was not applicable to municipal court appeals in the district court. This argument is premised on the fact that the speedy trial statute requires an accused to be brought to trial within 180 days “after arraignment on the charge.” The city conceded that the appeal was properly taken, that defendant was held to answer under appeal bond, and that the defendant was not tried within 180 days from his first appearance in district court.
The Supreme Court held that the obligation is placed on the prosecution to proceed with reasonable dispatch in the trial of criminal cases and that the speedy trial statute applies to appeals from a municipal court. 226 Kan. at 501-02. The court then concluded that the time limitations provided in the speedy trial statute commences to run from the date the appeal is, or should have been, docketed in the district court. In the same paragraph, the court stated the time limitation should commence to run when there is, or should be, a complaint against the defendant pending in the district court. 226 Kan. at 502.
In the case before this court, the appeal was docketed in the district court, but no complaint was filed in the district court because the city attorney did not receive notice the appeal had been filed.
We view Fricke as holding the speedy trial statute applies to municipal court appeals (possibly on the theory that the accused has already been arraigned in the municipal court), that the city has a statutory duty to certify the appeal to the district court, and, finally, that if the appeal is docketed within the time set by statute, the time limitation commences to run from the date the appeal is docketed. If not docketed, the time limitation commences to run from the date the appeal should have been docketed.
This analysis of Fricke, however, is confusing by reason of the court’s two references to what triggers the time limit. The court first discussed an amended complaint and said that the time limitation commences to run on an amended complaint from the date of arraignment on that complaint. 226 Kan. at 500. As noted above, the court held the time period is triggered by docketing the appeal and, then (in the same paragraph), the court held that the triggering event is the filing of a complaint. We are unsure whether the Supreme Court meant its reference to the complaint to apply to amended complaints or that the time can be triggered either by docketing an appeal or filing a complaint.
The case of City of Garnett v. Zwiener, 229 Kan. 507, was also decided prior to statutory changes in the appeal procedure, which permitted notices of appeal and appearance bonds to be filed in the district court. In Zwiener, the municipal judge and the clerk failed to certify the complaints, warrants, and appearance bonds within the 10-day period required by K.S.A. 22-3609(2). The opinion does not state how much in excess of 10 days the papers were certified to the district court. The Supreme Court held the requirement to certify the complaint, warrant, and appearance bond within 10 days of the notice of appeal is directory and not mandatory (jurisdictional) and, thus, the city could correct the error, provided the delay did not infringe on the defendant’s right to a speedy trial. 229 Kan. at 510. The court held that the time limitations on speedy trials “commence to run from the date the appeal is docketed in the district court or at the expiration of the time the appeal should have been docketed under the time schedule set forth in” the statute governing appeals from a municipal court (K.S.A. 22-3609), which ever comes first. 229 Kan. at 510. The case was then remanded to the trial court for further proceedings.
In Zwiener, the Supreme Court also said:
“Under K.S.A. 1980 Supp. 22-3609 governing appeals from municipal courts, once a proper notice of appeal has been filed, the failure of the judge whose judgment is appealed from, or the clerk of such court, to certify the complaint, warrant and appearance bond to the district court on or before the next court day will not defeat a review proceeding.” 229 Kan. at 510.
This paragraph lends support to Rabe’s position in that the court seems to hold that, once an accused does what the statute requires, the time limit for a speedy trial commences.
In City of Elkhart v. Bollacker, 243 Kan. 543, the district court dismissed an appeal from a municipal court because the defendant was not brought to trial within 180 days from the date of certification and filing of the municipal court transcript in the district court. Rollacker did not file an appearance bond.
The Supreme Court in Bollacker held that in an appeal from a municipal court, whether bond is required or whether the accused is simply served with a notice to appear and is thus required to appear without posting a bond, the speedy trial statute applies. 243 Kan. at 546. In affirming the trial court’s dismissal of the case, the Supreme Court reaffirmed that an accused is not required to take affirmative action to see that his or her right to a speedy trial is observed and that the burden is on the city to see that timely prosecution is had. 243 Kan. at 546.
Arrayed against the municipal court appeal cases, which make no specific holding about the statutory language that the speedy trial time limit commences as of arraignment, is a line of cases clearly holding that the statutory speedy trial clock commences to tick when arraignment is held. In State v. Rosine, 233 Kan. 663 at 669, the Supreme Court so held and stated:
“It is clear that Scott’s and Rosine’s court appearances on November 25, 1981, and November 5, 1981, respectively, wholly lacked the essential elements of an arraignment. No complaint was read to either defendant as no complaint existed. For like reason, no copy of the complaint could have been handed to either defendant. Further, there was no complaint on which to base a plea. The existence of a complaint, information or indictment filed against a defendant is a fundamental prerequisite to an arraignment.”
See State v. Huber, 10 Kan. App. 2d 560, 561-62, 704 P.2d 1004 (1985); State v. Taylor, 3 Kan. App. 2d 316, 320.
In Rosine, it was held that the failure to arraign the accused resulted in the statutory speedy trial period not commencing. Apparently, in the other line of cases, the Supreme Court relied on the municipal court proceeding as an acceptable substitute for arraignment. We thus have two rules — one for misdemeanors filed directly in the district court and one for appeals from municipal courts. Perhaps this could have been avoided by following the same rule as demonstrated in State v. Rosine (time starts with arraignment) and by requiring a violation of the constitutional right to a speedy trial when an appeal from a municipal court is not docketed, a complaint is not filed, or an arraignment is not held.
We are duty bound to follow the Supreme Court, and, based on the fact that City of Elkhart v. Bollacker was filed in 1988 and is the third case on the subject, we are unable to say the Supreme Court would change the result if faced with that issue today.
Here, Rabe did all he was required to do by statute to perfect his appeal. He is not required, as the trial court held, to have the sheriff serve the notice of appeal on the city attorney or send the notice of appeal by certified mail, return receipt requested. Service is not defined in the statute, nor is it defined in the code of criminal procedure. In a civil case, service is provided for by statute:
“Service upon the attorney or upon a party shall be made by delivering a copy to the attorney or a party or by mailing it to the attorney or a party at the last known address or, if no address is known, by leaving it with the clerk of the court. . . . Service by mail is complete upon mailing.” K.S.A. 1989 Supp. 60-205(b).
Rabe contends notice was mailed, and, since he filed a certificate of service with the district court, under K.S.A. 22-3606 and K.S.A. 1989 Supp. 60-205, service was complete. See Thompson v. Groendyke Transport, Inc., 182 Kan. 616, 620-21, 322 P.2d 341 (1958) (when notice of appeal is filed in proper court with proof of service made by affidavit, appeal should be deemed perfected). Whether the city attorney and the municipal court; actually received the notice is immaterial. Rabe has met the requirements of K.S.A. 22-3609.
The next question is whether the judge whose judgment is at issue, or the clerk of that court, had certified the complaint and warrant to the district court as required under K.S.A. 22-3609(3). No such certification appears in the record. The statute, however, specifically states that failure to meet this requirement “shall not affect the validity of the appeal.” K.S.A. 22-3609(3).
While there is no mention of docketing in the statute, the Supreme Court has said several times that the time limit on speedy trials begins to run “from the date the appeal is docketed in the district court or at the expiration of the time the appeal should have been docketed.” City of Garnett v. Zwiener, 229 Kan. 507, 510. See City of Overland Park v. Fricke, 226 Kan. 496, 502. The problem here is that when these two cases were decided,. the statute was worded differently, leaving a question of whether changes in the law should change the requirement established in these cases. Under the old version of the law, the appellant filed notice with the court in which he or she was first tried, and it was incumbent on the court to certify the appeal to the district where it would then be docketed. In 1982, after the Supreme Court decided Ziviener, the legislature changed the law. The new law simply skips a step. The appellant can now bring his or her appeal directly to the district court. K.S.A. 22-3609. The new law also incorporates the Zwiener holding and makes the original trial court’s certification immaterial.
Thus, no fault of the defendant is involved in the failure to try Rabe for 17 months after his appeal was docketed. In an appeal from municipal court on the issue of a statutory speedy trial, the accused has no affirmative duty to see that the speedy trial statute is complied with. Obviously, the accused could not deliberately cause the city not to receive notice, but, here, the trial court found the notice was mailed.
The purpose of guaranteeing speedy trials to those who appeal to district courts from municipal courts is clear. “[T]he speedy trial statute was intended to prevent the oppression of a citizen by holding criminal prosecutions suspended over him for an indefinite time and to prevent delays in the administration of justice.” City of Elkhart v. Bollacker, 243 Kan. at 545. See City of Overland Park v. Fricke, 226 Kan. at 501. Traditionally, the burden of going forward with a prosecution has been placed on the State, “however, the ultimate responsibility for management of the trial calendar is in the trial court.” State v. Higby, 210 Kan. 554, 556, 502 P.2d 740 (1972). The Supreme Court further addresses this concern in its rules:
“The most effective way of combating court delay is to modify the local legal culture by the adoption and use of a case management system. The basic concept of case management is that the court, rather than the attorneys, should control the pace of litigation. It is the duty of the judge to the people to run the court and not abdicate the responsibility to counsel.” General Principles and Guidelines for the District Courts (8), 1989 Kan. Ct. R. Annot. 46.
See General Rules Relating to District Courts, 1989 Kan. Ct. R. Annot. 45-47.
The City’s major complaint in this case was that it never got notice of the appeal. If the court had properly reviewed the docket and made an effort to be certain this case was heard in a timely fashion, the State would have gotten actual notice of the appeal, albeit through the judge rather than Rabe’s attorney.
We believe other factors are such to overcome the City’s failure to receive a copy of the notice of appeal, which the trial judge believed was not the fault of either party. The municipal court judge approved the appeal bond. No effort was made to enforce the sentence, despite the fact that the defendant was sentenced to serve a jail sentence and pay a fine. The defendant was subject to criminal charges and an appearance bond for 17 months.
Finally, the trial judge had a responsibility to see that the speedy trial statute was complied with. The appeal was docketed and simply sat on the trial docket for some 14 months until the defendant filed a motion to dismiss the case on the basis of denial of a speedy trial.
We hold the accused was denied his right to a statutory speedy trial. We do so with full realization that, in the past, the duty has been placed on a city or the State to comply with the speedy trial statute. Here, the City had notice other than a copy of the notice of appeal that the accused had filed an appeal (the municipal judge knew defendant’s sentence was not enforced, even though the jail sentence was mandated by state law if no appeal had been filed), and that fact alone should be sufficient to support our holding. That fact, coupled with the trial judge’s duty to manage the court docket, causes us to conclude Rabe’s conviction must be reversed, and the case is remanded to the trial court with directions to vacate Rabe’s conviction and to discharge the defendant. | [
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Gernon, J.:
Terry Evans appeals from the denial of his motion for a change of judge and from certain conditions imposed in an order of probation.
As part of a plea agreement, Evans pled guilty to a charge of rape and an amended charge of unlawful restraint. Other remaining charges against him were dismissed, including aggravated escape from custody and criminal damage to property.
Although Evans raises several issues on appeal, we conclude that his constitutional challenge to certain conditions of probation will be dispositive of this appeal.
Evans argues that certain conditions of probation which require church attendance at a specific church and the performance of 1000 hours of maintenance work at the same church violate his right to the free exercise of religion as guaranteed by the United States Constitution and the Kansas Constitution. We agree.
The Bill of Rights of the Kansas Constitution provides in part:
“The right to worship God according to the dictates of conscience shall never be infringed; nor shall any person he compelled to attend or support any form of worship; nor shall any control of or interference with the rights of conscience be permitted, nor any preference be given by law to any religious establishment or mode of worship.” Kan. Const. Bill of Rights, § 7 (Emphasis added).
This court has said, “Only those interests of the highest order and those not otherwise served can overbalance legitimate claims to the free exercise of religion.” Wright v. Raines, 1 Kan. App. 2d 494, 501, 571 P.2d 26, rev. denied 222 Kan. 749 (1977), cert. denied 435 U.S. 933 (1978).
In Wright, this court reversed the dismissal without a hearing of a habeas corpus petition which challenged a Department of Corrections rule prohibiting facial hair, as applied to á member of the Sikh religion. In Wright, we stated:
“But we are convinced that-such restrictions are not to be imposed so as to deny the free exercise of an established religious faith without a proper determination of compelling state interests in doing so," and without the further determination that there are no less restrictive methods of achieving the object of the regulation.” 1 Kan. App. 2d at 501.
We agree that certain conditions of probation may restrict constitutional rights or freedoms an ordinary citizen might enjoy. However, any such restrictions must bear a reasonable relationship to the rehabilitative goals of probation, the protection of the public, and the nature of the offense. See United States v. Terrigno, 838 F.2d 371, 374 (9th Cir. 1988).
In Porth v. Templar, 453 F.2d 330, 333 (10th Cir. 1971), the standard for evaluating a restriction of constitutional freedoms as a condition of probation was stated as follows:
"The sentencing judge has a broad power to impose conditions designed to serve the accused and the community. The only limitation is that the conditions have a reasonable relationship to the treatment of the accused and the protection of the public. The object, of course, is to produce a law abiding citizen and at the same time to protect the public against continued criminal or antisocial behavior. . . .
"... This is not to say that one on probation has the rights of citizens who are not on probation. He forfeits much of his freedom of action and even freedom of expression to the extent necessary to successful rehabilitation and protection of the public.” 453 F.2d at 333-34.
Evans’ case differs from the cases which uphold a condition of probation which restricts a probationer from certain religious activity or the association with certain groups. For example, in Malone v. United States, 502 F.2d 554, 555 (9th Cir. 1974), cert. denied 419 U.S. 1124 (1975), the Ninth Circuit Court of Appeals upheld a probationary condition that required that Malone “not belong or participate in any Irish Catholic organizations or groups.” Malone had been convicted of unlawfully exporting firearms.
In Evans’ case, the order of probation mandates or forces association with a particular religious group. Such conditions of probation have been permitted when clearly related to rehabilitation; for example, a requirement to submit to psychological counseling. United States v. Stine, 675 F.2d 69, 71 (3d Cir.), cert. denied 458 U.S. 1110 (1982).
Conversely, a condition which required the offender to make his child legitimate by marrying the mother was rejected as beyond the authority of the trial court. Michalow v. State, 362 So. 2d 456, 457 (Fla. Dist. App. 1978).
We conclude that the imposition of the religious conditions on Evans unreasonably restricted his constitutional freedom. The conditions would require Evans to continue association with a specific church for a five-year period, regardless of whether he continues to accept its religious beliefs and doctrines. It is not clear from the record how these conditions could be characterized as bearing a reasonable relationship to the protection of the public or the offense committed. Further, it is difficult to conclude that a compelling state interest requires the imposition of these particular probationary conditions.
The Kansas Constitution contains a strong prohibition against religious coercion. We are persuaded that the standards set in the Wright case ought to be applied in Evans’ case and that “only those interests of the highest order” ought to override the free exercise of religion. Lacking a showing of an interest of the highest order, we reverse and remand for resentencing before another judge.
Reversed and remanded with directions. | [
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Rees, J.:
John S. Lowe appeals from the denial of his K.S.A. 60-1507 motion attacking his conviction for aggravated battery (K.S.A. 21-3414). In denying Lowe’s 1507 motion, the district court relied on authority from other jurisdictions and determined that a defense based on the statute of limitations is not jurisdictional and can be waived if it was not raised at trial. This conclusion is a question of law subject to unlimited appellate review. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
Lowe contends that, although he pleaded nolo contendere to aggravated battery, his conviction must be vacated due to the State’s failure to prosecute the case within the statute of limitations. K.S.A. 21-3106. Lowe relies on State v. Washington, 12 Kan. App. 2d 634, 752 P.2d 1084, rev. denied 243 Kan. 782 (1988), to support his contention. In Washington, this court considered K.S.A. 21-3106 and the effect of the State’s failure to commence prosecution within two years after the crime was committed. We held that “if the delay in executing a warrant is unreasonable, such delay shall be included in computing the period within which a prosecution must be commenced.” 12 Kan. App. 2d at 637. Importantly, in Washington, the defendant raised the defense of the statute of limitations at trial. 12 Kan. App. 2d at 635. Therefore, the issue whether the statute of limitations is an affirmative defense waived by a nolo contendere plea was not specifically addressed.
In Kansas, the failure to raise the statute of limitations as a defense in a civil case constitutes waiver. K.S.A. 60-208(c). The Kansas Criminal Code does not specifically state whether the statute of limitations is jurisdictional or whether the failure to raise the defense in the trial court constitutes waiver.
K.S.A. 21-3106 provides in presently pertinent part:
“(3) Except as provided by subsection (4), a prosecution . . . must be commenced within two years after [the crime] is committed.
“(4) The period within which a prosecution must be commenced shall not include any period in which:
“(a) The accused is absent from the state; [or]
“(b) the accused is concealed within the state so that process cannot be served upon the accused;
“(5) An offense is committed . . . when every element occurs .... Time starts to run on the day after the offense is committed.
“(6) A prosecution is commenced when a complaint or information is filed, or an indictment returned, and a warrant thereon is delivered to the sheriff or other officer for execution. No such prosecution shall be deemed to have been commenced if the warrant so issued is not executed without unreasonable delay.”
Our Supreme Court considered whether the statute of limitations in criminal cases must be raised as an affirmative defense in In re Johnson, Petitioner, 117 Kan. 136, 230 Pac. 67 (1924). Although neither of the parties cite this case, we find it dispositive on the issue at hand. Johnson is factually similar to the case at bar. In Johnson, the defendant pleaded guilty to a charge of embezzlement. The defendant sought habeas corpus relief on the ground that his conviction was barred by the statute of limitations. The defendant argued that there had been a two-year delay between the time the warrant was issued and the time of his arrest, although he had been within the state during most of that time confined in the Kansas penitentiary.
The Supreme Court denied Johnson habeas corpus relief.
“The pleas of the statute of limitations and of former jeopardy in criminal actions are closely analogous and are governed by the same principles of law. Both are defenses, and they are defenses of the same general character. . . .
“. . . The conclusion to be drawn ... is that a defense in a criminal prosecution must be presented to the court on the trial of the case, and if error is committed therein the matter must be presented ... on [direct] appeal and cannot be raised ... by habeas corpus.” Johnson, 117 Kan. at 137.
The Court concluded that “the defense of the statute of limitations should have been presented to the trial court before the plea of guilty was entered.” Johnson, 117 Kan. at 138.
K.S.A. 22-3208(4) in pertinent part provides:
“A plea of guilty or a consent to trial upon a complaint, information or indictment shall constitute a waiver of defenses and objections based upon the institution of the prosecution or defects in the complaint, information or indictment other than it fails to show jurisdiction in the court or to charge a crime.”
“While a plea of nolo contendere, unlike a plea of guilty, may not be used as an admission in any other action based on the same act, for all other purposes a conviction based on a plea of nolo contendere is just like any other conviction.” State v. Buggs, 219 Kan. 203, Syl. ¶ 5, 547 P.2d 720 (1976).
Lowe argues that, because the Kansas criminal statute of limitations is similar to statutes of limitations in other jurisdictions, we should look to them for guidance in determining legislative intent. For example, Lowe contends that Kansas and Pennsylvania have similar statutes of limitations in criminal cases. Assuming that this is an accurate characterization, it hardly advances his argument. In Com. v. Darush, 279 Pa. Super. 140, 420 A. 2d 1071 (1980), the Superior Court held that the defense of the statute of limitations is waived unless timely asserted as an affirmative defense. See Pa. R. Crim. Proc. 306, 307 (1989).
We conclude the statute of limitations in a criminal case is an affirmative defense which can be waived by the knowing, voluntary, and intelligent acts of the defendant. This rule is in accord with K.S.A. 21-3106 and with Kansas case law. Other jurisdictions are in agreement with Kansas and hold that the statute of limitations is nonjurisdictional and can be waived. See United States v. Karlin, 785 F.2d 90, 92-93 (3d Cir. 1986), cert. denied 480 U.S. 907 (1987); State v. Johnson, 422 N.W.2d 14, 16 (Minn. App. 1988).
Applying this rule to the facts of this case, we find Lowe waived the defense by his nolo contendere plea. The trial court’s denial of relief in this K.S.A. 60-1507 proceeding was correct.
Affirmed. | [
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Brewster, J.:
Paulette and Ricki Winters appeal from a declaratory judgment which construed a Farm Bureau Mutual Insurance Company (Farm Bureau) automobile liability insurance policy’s limits of liability.
In January 1988, a two-vehicle automobile collision occurred in Linn County. One vehicle was owned by George Sutterby and driven by Curtis Sutterby. The other vehicle was owned and occupied by Paulette and Ricki Winters. The Sutterby vehicle was insured by Farm Bureau.
As a result of the collision, both Paulette and Ricki suffered bodily injuries. Paulette claims to have incurred expenses in excess of $100,000 for bodily injuries. Ricki claims to have incurred expenses of approximately $12,000. The Farm Bureau policy’s stated liability limits are $100,000 for “each person” and $300,000 for “each occurrence.” The controversy presented concerns whether Farm Bureau’s liability for Paulette’s claim is limited to $100,000 or whether Paulette and Ricki combined could realize up to $300,000.
Farm Bureau filed a petition for declaratory judgment in Johnson County District Court and moved for summary judgment. The court found that the insurance contract was not ambiguous and limited Farm Bureau’s liability for Paulette and Ricki individually to a maximum recovery of $100,000. Ricki and Paulette timely appeal. The Sutterbys filed no answer to the petition for declaratory judgment and are not parties to this appeal.
The question before us is whether the district court erred in finding the insurance contract unambiguous and limiting Farm Bureau’s liability coverage to $100,000 for Paulette and Ricki individually.
Our scope of review of a written contract is broad. “Regardless of the construction of the written contract made by the trial court, on appeal a contract may be construed and its legal effect determined by the appellate court.” Patrons Mut. Ins. Ass’n v. Harmon, 240 Kan. 707, 713, 732 P.2d 741 (1987); Kansas Gas & Electric Co. v. Kansas Power & Light Co., 12 Kan. App. 2d 546, 551, 751 P.2d 146, rev. denied 243 Kan. 779 (1988). “This court can review the negotiated agreement and decide its legal effect. Regardless of the construction the district court gave the agreement, this court may independently construe the contract and determine its legal significance.” NEA-Goodland v. U.S.D. No. 352, 13 Kan. App. 2d 558, 562, 775 P.2d 675, rev. denied 245 Kan. 785 (1989).
The fact that summary judgment was entered by the district court is of no consequence. On a motion for summary judgment, both the district court and the appellate courts are required to resolve all facts and draw all inferences in favor of the party against whom the ruling is sought. Bacon v. Mercy Hosp. of Ft. Scott, 243 Kan. 303, 306, 756 P.2d 416 (1988). In this case, there are no conflicting facts or inferences. The issue raised is purely a question of law over which this court’s review is unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
The following language from the Farm Bureau insurance contract is the source of the debate:
“LIMITS OF LIABILITY
“The limits of liability shown in the declarations apply subject to the following:
“1. The bodily injury liability limit for ‘each person’ is the maximum for bodily injury sustained by one person in any one occurrence;
“2. The bodily injury liability limit for ‘each occurrence’ is the maximum limit of liability for bodily injury sustained by two or more persons in any one occurrence.”
The policy declarations recite a limit of $100,000 for each person and $300,000 for each occurrence.
It is the Winters’ contention that the policy is patently ambiguous, allowing $100,000 for injuries to one person in one occurrence, but also allowing $300,000 for injuries to two people in one occurrence. They argue that the two clauses are separate, and nothing in the policy ties them together. In support of their position, the Winters cite two Kansas cases which discuss the construction and interpretation of insurance contracts.
“ ‘In determining the intention of the parties to a contract of insurance, the test is not what the insurer intends the printed language to mean, but rather what a reasonable person placed in the position of the insured would have understood the words to mean.’
“ ‘Where provisions of an insurance policy are ambiguous or conflicting, the policy is to be construed strictly against the insurer and in favor of the insured.’
“ ‘Where an insurer intends ’ to limit or restrict the coverage under its policy, it should use language which clearly reveals its stated purpose.’ [Citation omitted.]” Alliance Life Ins. Co. v. Ulysses Volunteer Firemans Relief Assn., 215 Kan. 937, 947-48, 529 P.2d 171 (1974).
“It is a general rule that exceptions, limitations and exclusions to insuring agreements require a narrow construction on the theory that the insurer, having affirmatively expressed coverage through broad promises, assumes a duty to define any limitations on that coverage in clear and explicit terms.” Baugher v. Hartford Fire Ins. Co., 214 Kan. 891, 900, 522 P.2d 401 (1974).
Farm Bureau contends the insurance contract is clear and unambiguous, with the $100,000 per person limit overriding any claim by one person for more than that under the $300,000 per occurrence clause. It cites Kansas common-law rules concerning the interpretation of insurance contracts. A court “will not torture words in order to import ambiguity where the ordinary meaning leaves no room for ambiguity.” Eddy v. Travelers Ins. Co., Hartford, Conn., 212 F.2d 518, 520 (10th Cir. 1954). “[U]nless the provisions in question are ambiguous, the rule is they are not susceptible of judicial interpretation but must be construed in their ordinary sense.” Brown v. Metropolitan Life Ins. Co., 166 Kan. 616, 621, 203 P.2d 150 (1949).
In summary, Farm Bureau has cited language stating that, if a contract is unambiguous, the court should take it as it finds it. The Winters have cited language stating that, if a contract is ambiguous, the insurer, not the insured, should suffer from the ambiguity. Both are correct, so the first task at hand is to determine whether the contract is ambiguous.
As noted in Haney v. State Farm Insurance, 52 Wash. App. 395, 397-98, 760 P.2d 950 (1988), rev. denied 111 Wash. 2d 1033 (1989), a case nearly identical to the present case:
“It is true that members of the legal profession, the insurance industry, and others familiar with the structure and operation of insurance contracts are generally aware that the per accident limits of the typical insurance contract are intended to operate subject to the per person limits. The question before this court, however, is not what people subjectively know about such clauses; the question is what the average reasonable insured would know from reading the clauses at issue in this policy. [Citation omitted.]”
In Haney, an insured couple sought a declaratory judgment stating they were entitled to the $300,000 per accident limit of their uninsured motorist policy rather than the $100,000 per person limit. The trial court entered summary judgment for the insurer. The Washington Court of Appeals, finding the contract ambiguous, reversed.
The policy in Haney stated:
“Limits of Liability
“1. The amount of coverage is shown on the declarations page under ‘Limits of Liability — U—Each Person, Each Accident’. Under ‘Each Person’ is the amount of coverage for all damages due to bodily injury to one person. Under ‘Each Accident’ is the total amount of coverage for all damages due to bodily injury to two or more persons in the same accident.” 52 Wash. App. at 397.
This provision is indistinguishable from the present Farm Bureau policy. The Haney court held:
“The liability limits provision contains an inherent contradiction: the per person limit is $100,000, but the per accident limit is $300,000 for damages to ‘two or more persons’. There is no language making the per accident limit subject to the per person limit. The existing language in the two clauses cannot be reconciled. The per accident limit directly implies that two people injured in one accident may recover up to $300,000 while the per person limit says each person is limited to $100,000.” 52 Wash. App. at 397.
The court distinguished the case before it from others in which the per accident policy limit was expressly made subject to the per person limit. It held that, since this was not done, the provision was patently ambiguous and must be construed in the insured’s favor. 52 Wash. App. at 398-99.
The Winters next cite Andrews v. Nationwide Mut. Ins. Co., 124 N.H. 148, 467 A.2d 254 (1983), which is also factually indistinguishable from the present case. The policy limits provisions in Andrews stated:
“ ‘Our obligation to pay Bodily Injury losses under this coverage is limited to the amounts per person and per occurrence stated in the attached Declarations. . . . The following conditions apply to these limits:
“ T. Limits shown for any one person are for all legal damages claimed by anyone for bodily injury or loss of services of one person as a result of one occurrence. For each such occurrence, the total limit of our liability shown is for all damages sustained by two or more persons.’ ” 124 N.H. at 152.
The court framed the issue as:
“Whether the claim of the plaintiff Rachel Andrews under the uninsured motorist coverage of the automobile liability policy on account of her bodily injuries, where more than one person has sustained damages in the same occurrence, is limited only by the aggregate per ‘occurrence’ limit of $300,000, and is not subject to the ‘one person’ limit of $100,000.” 124 N.H. at 150.
The court affirmed a district court verdict in favor of the insured. It noted that it normally would agree with the insurer’s position except for the fact that the policy lacked any language making the per occurrence limit subject to the per person limit. “If the defendant wished to preclude such a result, clear and unambiguous policy language to the effect that the per occurrence’ limit is subject to the ‘per person’ limit could easily have been included in the policy.” 124 N.H. at 154.
Farm Bureau cites two cases which limit an individual to the per person limit rather than allowing the higher per occurrence limit. Both of these cases, Standard Acc. Ins. Co. of Detroit, Mich. v. Winget, 197 F.2d 97 (9th Cir. 1952), and Lowery v. Zorn, 184 La. 1054, 168 So. 297 (1936), are factually similar to the present case. However, in both cases, the per occurrence limit was explicitly made subject to the per person limit.
In Lowery, the court quoted from the policy, noting “the limit of liability as fixed in the policy is $5,000 for bodily injuries to one person and ‘subject to the same limit for each person’ $10,000 for any one accident causing bodily injury to more than one person.” 184 La. at 1057-58. Therefore, the Lowery court held the insured could only collect up to the per person limit.
In Standard, the applicable portion of the policy reads:
“ ‘Limits of Liability — Coverage A. * * * The limit of bodily injury liability stated in the declarations as applicable to “each person” is the limit of the company’s liability for all damages, including damages for care and loss of services, arising out of bodily injury, including death at any time resulting therefrom, sustained by one person in any one accident, the limit of such liability stated in the declarations as applicable to “each accident” is subject to the above provision respecting each person, the total limit of the company’s liability for all damages, including damages for eare and loss of services, arising out of bodily injury, including death at any time resulting therefrom, sustained by two or more persons in any One accident.’ ’’ (ÍEmphasis added.) 197 F.2d’ at 104 n.2.
The Standard court also held the insured could only recover up to the per person limit. Another similar case is Mannheimer Bros. v. The Kansas C. & S. Co., 149 Minn. 482, 184 N.W. 189 (1921).
It appears there is a clear dichotomy. In the eases in which the per occurrence damage limit is made subject to the per person limit (Lowery, Standard, Mannheimer), the courts simply enforce the contract as written. In the cases which lack such language (Haney, Andrews), the courts have found the contracts ambiguous and, following the rule which requires ambiguities to be settled in favor of the insured, allow the insured to collect up to the higher per occurrence limit. This dichotomy was noted by the Andrews court when it distinguished Andrews from Standard and Mannheimer. 124 N.H. at 153.
Farm Bureau endeavors to align the present case with the Lowery, Standard, and Mannheimer line of cases. It contends the language of the liability limits clause clearly makes the per occurrence limit subject to the per person limit. Again, the provision states:
“LIMITS OF LIABILITY
“The limits of liability shown in the declarations apply subject to the following:
“1. The bodily injury liability limit for ‘each person’ is the maximum for bodily injury sustained by one person in any- one occurrence;
“2, The bodily injury liability limit for ‘each occurrence’ is the maximum limit of liability for bodily injury sustained by two or more persons in any one occurrence.” (Emphasis added.)
Farm Bureau argues that the emphasized language abqve “clearly and unambiguously” makes the “each occurrence” limit subject to the “each person” limit. This conclusion is unwarranted. The provision simply is explanatory of the dollar amounts appearing in the declarations and does nothing to make the “each occurrence” limit subject to the “each person” limit.
It is apparent that the present case is aligned with Haney and Andrews and is distinguishable from Lowery, Standard, and Mannheimer. While Haney and Andrews are not binding authority, they are persuasive. The provision in the contract is ambiguous and should he construed against the insurer.
Farm Bureau makes other arguments which, while not persuasive, require brief mention. Farm Bureau quotes the sentence which appears immediately after the above-cited provision and concludes this language limits the Winterses to the per person limit. The sentence states: “We will pay no more than these máximums regardless of the number of vehicles described in the declarations, insured persons, claims, claimants or policies, or vehicles involved in the- occurrence.”’ This sentence does not resolve the ambiguity. We find it to be of no help.
Also cited by Farm Bureau is McClellan v. Blasdel, 193 Kan. 410, 393 P.2d 1012 (1964). In that cáse, it was agreed by the parties that an insurance policy limited plaintiffs recovery to $25,000, but the issue was whether that limit may be exceeded when the policy was not placed in evidence before the jury. Plaintiff was limited to $25,000. While Farm Bureau contends McClellan requires all per person limits to be strictly enforced, such an interpretation is unjustified. McClellan had nothing to do with the ambiguity .question now before us and is inapposite to the present case.
Finally, Farm- Bureau cites K.S.A. 40-3107(e), which sets out the minimum limits of statutorily required automobile liability coverage. It states:
“Every policy of motor vehicle liability insurance issued by an insurer to an owner residing in this state shall:
“(e) contain stated limits of liability, exclusive of interest and costs, with respect to each vehicle for which coverage is granted, not less than $25,000 because of bodily injury to, or death of, one person in any one accident and, subject to the limit for one person, to a limit of not less than $50,000 because of bodily injury to, or death of, two or more persons in any one accident.” (Emphasis added.)
Farm Bureau then points to DeWitt v. Young, 229 Kan. 474, 480, 625 P.2d 478 (1981), which stands for the proposition that an insurance policy may provide coverage limits in excess of the statutory mínimums. This is true, but the question before us does not stem from the fact that Farm Bureau’s policy provides coverage ($100,000/300,000) beyond the statutory minimum ($25,000/ 50,000). The flaw is that, in providing this additional coverage, Farm Bureau imported ambiguity into the policy by failing to use language effectively making the per occurrence limit subject to the per person limit.
Because the Farm Bureau insurance contract has patently conflicting clauses and Kansas case law requires such ambiguity to be construed against the insurer, the district court erred in limiting Farm Bureau’s exposure to $100,000 per person. The ambiguity we find would not have arisen had Farm Bureau utilized the phraseology of K.S.A. 40-3107(e), that is, “[$100,000] because of bodily injury to . . . one person in any one accident and, subject to the limit for one person, to a limit of . . . [$300;000] because of bodily injury to . . . two or more persons in any one accident.”
Reversed. | [
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Briscoe, J.:
Defendant Karl Garrett appeals from a court order assessing extradition costs. We affirm.
The facts are undisputed and are as follows; On December 30, 1986, defendant pled guilty to a charge of criminal damage to property, a class A misdemeanor, (K.S.A. 21-3720) and was sentenced to one year in the county jail. On January 21, 1987, the court placed defendant on probation for one year and included among the conditions of probation the special conditions that defendant pay court costs, fees, and restitution. After defendant was arrested for shoplifting and failed to report, defendant’s probation officer requested revocation. Based upon the officer’s motion, the court issued a bench warrant. Defendant was found in Nevada and extradited to Kansas, where his probation was revoked on June 24, 1987, and he was sentenced to serve the sentence previously imposed. Defendant’s motion to modify his sentence was granted and, on October 8, 1987, he was placed on parole for one year and again ordered to pay court costs, fees, and restitution. (When a court releases a person confined in the county jail prior to the expiration of his term of imprisonment, subject to conditions and supervision, the court places the person on parole, not probation. See K.S.A. 21-4602[4].) On August 5, 1988, while defendant was still on parole, the State filed a motion to modify the October 8 order to also require defendant to pay extradition costs of $743.99. The court granted the State’s motion and assessed the extradition costs against defendant.
We note in passing that the extradition of this misdemeanant was accomplished because his conviction was placed in the computer as a felony, not a misdemeanor. This point was addressed by defense counsel before the trial court, but it is not raised as an issue on appeal.
The issue presented is whether a trial court has the authority to assess extradition costs against a convicted defendant more than 120 days after revocation of probation. We conclude the trial court has authority to assess extradition costs against a defendant at any time prior to defendant’s release from probation or parole.
Extradition costs are not an additional penalty, but are properly chargeable to a convicted defendant to allocate the expenses incurred in prosecution. State v. Dean, 12 Kan. App. 2d 321, 323, 743 P.2d 98, rev. denied 242 Kan. 904 (1987). K.S.A. 22-2724 provides that extradition costs “shall be treated as costs of the criminal proceedings and shall be taxed and paid as provided in K.S.A. 22-3801 et seq.” Under K.S.A. 22-3801(a), the taxing of court costs against the convicted defendant is mandatory. Dean, 12 Kan. App. 2d at 325. In Dean, the defendant argued the imposition of extradition costs over four months after his sentence resulted in the imposition of an additional penalty. The court held that assessment of extradition costs was not a penalty, but rather a fixed cost which must be imposed pursuant to 22-3801(a).
In the present case, we are asked to define the period during which the trial court may tax extradition costs against the de fendant. K.S.A. 22-3803 states: “At the conclusion of each criminal case the court shall tax the costs against the party responsible for payment.” The meaning of the phrase “at the conclusion of the criminal case” has not been determined. This issue was not directly raised in Dean. In Dean, the State filed the motion to impose costs within the 120-day period during which the district court retained jurisdiction to modify sentence pursuant to K.S.A. 21-4603(3). 12 Kan. App. 2d at 322. The court held that a “four-month delay in imposing extradition costs did not prejudice defendant. The court was not required to compute costs until after the conclusion of the criminal case.” 12 Kan. App. 2d at 325. In the present case, the motion to impose costs was filed over 13 months after revocation of defendant’s probation. Defendant contends the imposition of costs was a sentence modification and the trial court was without jurisdiction to modify his sentence pursuant to 21-4603(3).
K.S.A. 21-4603(3) provides:
“Any time within 120 days after a sentence is imposed or within 120 days after probation or assignment to a community correctional services program has been revoked, the court may modify such sentence, revocation of probation or assignment by directing that a less severe penalty be imposed in lieu of that originally adjudged within statutory limits.”
The statute specifically authorizes the court to impose a less severe penalty than was originally imposed. The statute is irrelevant to the issue of imposition of statutorily fixed costs; rather, it is intended to allow a trial court the discretion to lessen whatever criminal penalties were imposed. This court has already held that the imposition of extradition costs is a mandatory allocation of prosecution expenses and not a criminal penalty. Dean, 12 Kan. App. 2d at 323. Thus, 21-4603(3) is inapplicable to the present issue, and defendant’s argument that the 120-day limitation prohibits the assessment of extradition costs is without merit.
K.S.A. 21-4610 concerns the conditions which the trial court may impose when probation is granted or a sentence is suspended and specifies, without limiting, a variety of conditions. These conditions are modifiable at any time (21-4610[2]). Pursuant to 21-4610(3)(g), the trial court may require the payment of fines and costs which are applicable to the offense. We conclude the import of these statutes is to authorize the trial court to add as a condition of probation or parole the payment of court costs at any time prior to termination of the probationary or parole period.
The relationship of 21-4610 and the assessment of extradition costs was recently explored in State v. Higgins, 240 Kan. 756, 732 P.2d 760 (1987). In Higgins, the defendant was assessed extradition fees pursuant to K.S.A. 22-2724 and 22-3801. He was then paroled from paying the assessed costs. The State appealed and the issue was whether the trial court had authority to release the defendant without requiring payment of all costs. The court referred to the broad discretionary authority given the trial court in imposing conditions of probation set forth in 21-4610. The court concluded that 22-2724 and 22-3801 should be construed together to mean that a judgment of extradition costs is a civil judgment. As a civil judgment, it can be collected whenever a defendant has sufficient property to satisfy the judgment. The court went on to conclude that, under the broad discretionary authority of a trial court to grant probation or parole, a trial court may excuse a defendant from immediate payment when he is released on probation or parole. 240 Kan. at 760.
The trial court has broad authority under 21-4610 to impose or modify any general or specific conditions of probation or parole. In the present case, the court modified the conditions of defendant’s parole when it taxed extradition costs against him. When the trial court taxed extradition costs against the defendant, who was still on parole, the court acted within its authority as set forth in 21-4610 and 22-3801.
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Briscoe, J.:
Defendant Gregory Kelly appeals his jury conviction of driving under the influence of alcohol, in violation of K.S.A. 1987 Supp. 8-1567. Although 8-1567 was amended in both 1988 and 1989, those amendments, while significant, are not germane to the issue in this case.
The sole issue presented is whether defendant was denied his statutory right to consult with counsel as provided in K.S.A. 1987 Supp. 8-1001(f)(l)(E), and, if he was denied counsel in violation of this statute, whether the proper remedy is suppression of the State’s breath test or dismissal of the charge. Upon review of the facts presented, we conclude defendant’s statutory right to consult with counsel as provided by 8-1001(f)(l)(E) was violated. We reverse defendant’s conviction and remand the case for a new trial.
On May 28, 1988, at 2:18 a.m., Trooper Phillip Bostian stopped defendant’s 1949 automobile, which was factory equipped with only one taillight. Bostian had observed the automobile weave from the right lane to the left lane without signaling. After Bostian asked defendant to produce his license and get out of the automobile, Bostian noticed defendant was swaying, his eyes were bloodshot, and his speech was slurry or mushy. Bostian also smelled the odor of intoxicants.
Defendant was asked to perform some field sobriety tests, including the horizontal gaze nystagmus test, the alphabet test, the one-leg stand test, and the walk and turn test. Bostian placed defendant under arrest after he was unable to pay attention and follow the directions on the walk and turn test. Bostian reported that defendant failed the nystagmus test and the one-leg stand test and did not attempt the walk and turn test, but passed the alphabet test. Defendant testified he was unable to perform the balancing tests because he had problems with his knees and because a gunshot wound to his head had affected his balance.
As they were driving to jail, Bostian observed that defendant was sleeping. When they arrived at the jail, defendant stumbled and swayed as he got out of the automobile. At the jail booking desk, Bostian read defendant the implied consent advisory form, which states:
“1. Kansas law (K.S.A. 8-1001) requires you to submit to and complete one or more tests of breath, blood or urine to determine if you are under the influence of alcohol, drugs, or both.
“2. If you refuse to submit to and complete any test of breath, blood or urine hereafter requested by a law enforcement officer, your refusal will result in the suspension of your driver’s license for six (6) months.
“3. You have no right to consult with an attorney regarding whether to submit to testing.
“4. If you refuse to submit to and complete testing, your refusal may be used against you at any trial on a charge arising out of the operation or attempted operation of a motor vehicle while under the influence of alcohol and/or drugs.
“5. If you decide to submit to testing, after testing is completed you have the right to consult with an attorney and you may secure additional testing, which, if desired, should be done as soon as possible and is customarily available from hospitals, medical care facilities and physicians.
“6. If you submit to the testing requested of you, the results of the test or tests may be used against you at any trial on a charge arising out of the operation or attempted operation of a motor vehicle while under the influence of alcohol and/or drugs.”
When Bostian asked defendant to submit to a breath test, he refused unless his attorney was present. After defendant was told he did not have the right to consult his attorney at that point, defendant agreed to be tested because he believed he could consult his attorney after he submitted to testing.
Defendant was observed for 20 minutes, after which he gave two breath samples, one incomplete and one successful. Bostian testified the second test was satisfactory and that he would not have requested additional testing. After completing the breath test, defendant requested a blood test and to see his attorney. Bostian took defendant to St. Joseph’s Hospital and tape-recorded their conversation en route. Bostian testified that, at various times, defendant asked to speak to an attorney before the breath test and after the breath test, and that he asked to have his attorney present. The taped conversation indicates defendant asked several times to have his attorney present during the blood test, and at least once he indicated he was being denied his right to communicate with his attorney. Bostian also testified that defendant was handcuffed and therefore could not have called his attorney, and that he asked both Bostian and a physician at the hospital to call his attorney for him. After being told his attorney could not be present and having failed to elicit any help in communicating with his attorney, defendant refused to take the blood test, and he was returned to jail.
Defendant was charged with driving under the influence, K.S.A. 1987 Supp. 8-1567(a)(l) and (2); failing to drive within a single lane, K.S.A. 8-1522: failing to signal when changing lanes, K.S.A. 8-1548; and driving while his driving privileges were suspended or revoked, K.S.A. 1987 Supp. 8-262(a)(l).
Defendant filed two motions to suppress the results of the breath test and one motion to dismiss. In support of his motions, he argued the results of the breath test and all statements should be suppressed on the grounds that custodial interrogation took place without defendant first being advised of his Miranda rights. In addition, defendant argued his right to consult with counsel under K.S.A. 1987 Supp. 8-1001(f)(l)(E) was violated, warranting dismissal of the charges. He also challenged the State’s procedures in conducting his breath test, claiming he had belched or slightly regurgitated prior to the test, making the results unreliable.
After a hearing, the court denied the motions and found defendant had not invoked his right to consult with counsel under 8-1001(f)(l)(E), stating: “The words are magic. The words are absolutely magic and are a creature of law. He has to have stated that before deciding to take the test, I want to consult with an attorney on whether or not to take the second test.” The court also read the statute to mean that consulting with an attorney was only for the limited purpose of deciding whether to take the second test. Since defendant had already decided to take the test, the court found he could not consult with an attorney. Defendant filed a motion to reconsider his previous motions to suppress and dismiss, which was denied.
Prior to trial, all counts except driving under the influence were dismissed on the State’s motion. Following a jury trial, defendant was convicted and sentenced to imprisonment for 270 days and fined $750. Following oral application, defendant was placed on probation. Defendant’s motion for new trial was denied.
Denial of Right to Consult with Counsel
Defendant contends the denial of his request to consult with counsel after he had submitted to a breath test requested by the State violated his statutory right to consult with counsel. While defendant contends such denial is violative of the United States Constitution, the Kansas Constitution, and 8-1001(f)(l)(E), the statutory violation is all that is significantly addressed on appeal.
The State claims that, even if defendant had a right to consult with counsel under 8-1001(f)(l)(E), when that statute is read in connection with K.S.A. 1987 Supp. 8-1004, he (1) did not properly invoke his right to consult with his attorney, (2) was properly given an opportunity to have additional testing, and (3) refused to take the additional test and therefore was not harmed by his lack of consultation with his attorney.
Judicial interpretation of statutes must be reasonable and sensible to effectuate legislative design and the true intent of the legislature. State v. Fowler, 238 Kan. 213, 215, 708 P.2d 539 (1985). Where penal statutes are concerned, however, the rule of strict construction applies. The rule of strict construction of penal statutes against the State and for the accused is “ ‘not much less old than construction itself.’ ” State v. Trudell, 243 Kan. 29, 34, 755 P.2d 511 (1988). We may not give a different meaning to a word in a criminal statute than the word usually possesses. The word should not be given a meaning which leads to uncertainty or confusion if it is possible to construe it otherwise. 243 Kan. at 34. Words in common usage are to be given their natural and ordinary meaning. State v. Magness, 240 Kan. 719, 721, 732 P.2d 747 (1987).
Therefore, in the case at bar, K.S.A. 1987 Supp. 8-1001(f)(l)(E) must be construed against the State and in favor of defendant.
Kansas, like many other states, has enacted an implied consent statute:
“Any person who operates or attempts to operate a motor vehicle within this state is deemed to have given consent, subject to the provisions of this act, to submit to one or more tests of the person’s blood, breath, urine or other bodily substance to determine the presence of alcohol or drugs. The testing deemed consented to herein shall include all quantitative and qualitative tests for alcohol and drugs. A person who is dead or unconscious shall be deemed not to have withdrawn the person’s consent to such test or tests, which shall be administered in the manner provided by this section.” K.S.A. 1987 Supp. 8-1001(a).
K.S.A. 1987 Supp. 8-1001(f)(l) provides:
“Before a test or tests are administered under this section, the person shall be given oral and written notice that: (A) There is no right to consult with an attorney regarding whether to submit to testing; (B) refusal to submit to and complete any test of breath, blood or urine hereafter requested by a law enforcement officer will result in six months’ suspension of the person’s driver’s license; (C) refusal to submit to testing may be used against the person at any trial on a charge arising out of the operation or attempted operation of a motor vehicle while under the influence of alcohol or drugs, or both; (D) the results of the testing may be used against the person at any trial on a charge arising out of the operation or attempted operation of a motor vehicle while under the influence of alcohol or drugs, or both; and (E) after the completion of the testing, the person has the right to consult with an attorney and may secure additional testing, which, if desired, should be done as soon as possible and is customarily available from medical care facilities and physicians. After giving the foregoing information, a law enforcement officer shall request the person to submit to testing. The selection of the test or tests shall be made by the officer. If the person refuses to submit to and complete a test as requested pursuant to this section, additional testing shall not be given and the person’s driver’s license shall be subject to suspension as provided in K.S.A. 8-1002 and amendments thereto. The person’s refusal shall be admissible in evidence against the person at any trial on a charge arising out of the alleged operation or attempted operation of a motor vehicle while under the influence of alcohol or drugs, or both.” (Emphasis added.)
Following passage of the implied consent statutes, a bevy of questions arose concerning such issues as the Fifth Amendment right against self-incrimination, the requirement of Miranda warnings, and the Sixth Amendment right to counsel. While all of these issues are tangentially related to the case at bar, the only issue presented is whether defendant’s statutory right to consult with counsel under 8-1001(f)(1)(E) has been violated.
The Kansas Supreme Court has determined there is no Sixth Amendment right to counsel prior to determining whether to submit to the test required by the Kansas implied consent law. State v. Bristor, 236 Kan. 313, 322, 691 P.2d 1 (1984). In explaining its holding, the court stated:
“In determining the stage of the criminal prosecution when the assistance of counsel is constitutionally mandated, the court looks to the detriment which the defendant would sustain if forced to undergo a particular stage of the proceeding without counsel; this process of determination has been labeled the critical stage analysis. [Citation omitted.]” 236 Kan. at 317.
Further, the court stated:
“In determining ... a critical stage, . . . the court considers whether the presence of counsel is ‘necessary to preserve the defendant’s basic right to a fair trial . . . .’ Second, the court analyzes whether ‘potential substantial prejudice’ to the defendant’s right inheres . . . and whether the presence of counsel would help avoid such prejudice. [Citation omitted.]” 236 Kan. at 318.
The court then concluded that, although whether to take or refuse a blood alcohol test was critical to the individual, it is not critical in the constitutional sense.
Following Bristor, the legislature expanded the statutory requirements governing the administration of blood alcohol tests under the Kansas implied consent law. L. 1985, ch. 48, § 3; ch. 50, § 1. The statute requires that persons arrested for driving under the influence be given written and oral notice of their statutory rights. In Barnhart v. Kansas Dept. of Revenue, 243 Kan. 209, 755 P.2d 1337 (1987), the court held these notice provisions were mandatory. The court stated: “The clear language of the statute indicates that the legislature intended to ensure that a person arrested for driving under the influence was made aware, by the required notice procedure, of his statutory rights.” 243 Kan. at 212.
One of those statutory rights is the right to counsel. K.S.A. 1987 Supp. 8-1001(f)(l)(E) reads:
“[A]fter the completion of the testing, the person has the right to consult with an attorney and may secure additional testing, which, if desired, should be done as soon as possible and is customarily available from medical care facilities and physicians.”
In the present case, defendant was properly read and given a written copy of the notice provisions of the statute. He submitted to testing and then invoked his right to counsel. The plain language of the statute is “after the completion of the testing, the person has the right to consult with an attorney and may secure additional testing.” The court hearing defendant’s motions to suppress and to dismiss determined defendant not only had to articulate his request in the specific words of the statute, but that the right to consult with an attorney was for the limited purpose of deciding whether to take the additional test. In the court’s view, since defendant had already asked to have a second test, his right to consult with an attorney was waived.
We have found no authority to support the interpretation that one has to repeat the language of a statute verbatim in order to invoke its provisions. Given the rules of construction for penal statutes, the statute must be construed in favor of the accused. State v. Trudell, 243 Kan. 29. Applying that construction to the statute at issue leads us to the conclusion that defendant did not have to repeat the language of the statute in order to consult with his attorney.
An analogy which is helpful to our construction of 8-1001(f)(l)(E) is the invocation of the Sixth Amendment right to counsel to terminate interrogation. Smith v. Illinois, 469 U.S. 91, 96 n.3, 83 L. Ed. 2d 488, 105 S. Ct. 490 (1984), outlines three approaches to determine whether the right to counsel has been properly invoked: (1) No matter how ambiguously a defendant refers to an attorney, questioning must cease; (2) a threshold standard of clarity is outlined and, if the request falls below the line, the request does not trigger the right; and (3) an ambiguous requesf is met with no further interrogation, but questions to clarify the request may be asked. Under any of these standards, defendant’s request in the present case would result in the cessation of questioning.
In Smith, the Court determined defendant’s request was sufficiently clear to invoke his right to counsel. While questioning Smith, the police detective said, “You have a right to consult with a lawyer and to have a lawyer present with you when you’re being questioned. Do you understand that?” Smith responded, “Uh, yeah. I’d like to do that.” 469 U.S. at 93. The Court determined this statement was an unequivocally clear initial request for counsel. 469 U.S. at 100. When detectives continued to question him, Smith’s rights were violated.
In the present case, after submitting to the breath test, defendant said several times that he wanted his attorney present when the blood test was administered, or that he was being denied his right to communicate with his attorney. Construing the statute in favor of the accused and against the State, defendant’s requests were sufficient to invoke his statutory right to consult with an attorney.
The trial court also determined the right to consult with an attorney was limited to consultation about taking a second independent test. Again, using the rules of strict construction in favor of the accused, we cannot construe the statute to so limit the consultation. Although the word “and” is used in the conjunctive sense connecting the clauses “the person has the right to consult with an attorney” and “may secure additional testing,” had the legislature intended to limit the consultation to whether a second test is performed, it could easily have written “the person has the right to consult with an attorney to determine whether to secure additional testing.” Given the plain language and meaning of the words, and the rule of statutory construction which requires that we construe the statute in favor of the accused, the right to consult an attorney is not limited solely to determining whether to take an additional test.
The State argues the trial court’s determination that Bostian did not deny defendant’s opportunity to consult an attorney was a question of fact and the appellate court must only look to see if there is substantial competent evidence to support the finding. In addition, the State argues defendant did not object when the breath test was admitted into evidence at trial, and, therefore, under State v. Chiles, 226 Kan. 140, 144, 595 P.2d 1130 (1979), the issue is not preserved on appeal.
While the State is correct in asserting that findings of fact are upheld on review when supported by substantial competent evidence, it fails to acknowledge that this court’s review of conclusions of law is unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988). The trial court’s determination that defendant had to repeat the language of the statute in making his request to consult with an attorney and could consult with an attorney only about securing an additional test clearly fell within the realm of law rather than fact. Thus, this court’s review is unlimited.
The State’s assertion that defendant failed to object to the admission of the breath test is in error. Counsel objected to the admission of State’s exhibit 7, the printout from the successful breath test. Whether defendant’s statutory right to counsel was violated was preserved for appellate review.
Under the facts of this case, defendant was given proper notice of his right to consult an attorney once he submitted to the breath test. The testimony clearly indicated, under the totality of the circumstances, that defendant invoked his right to counsel and was denied the opportunity to consult with his attorney, in violation of 8-1001(fj(l)(E).
Remedy for Violation of Right to Consult with Counsel
Defendant contends that charges against him should be dismissed or, in the alternative, a new trial should be conducted and the results of the breath test suppressed. The State contends defendant was not denied his right to consult with counsel but, if the court so finds, suppression of the evidence is the appropriate sanction.
The statute is silent as to what sanction should be imposed for denial of the right to consult an attorney under 8-1001(f)(l)(E). The statute does address, however, sanctions for failure to allow an independent test. K.S.A. 1987 Supp. 8-1004 states:
“Without limiting or affecting the provisions of K.S.A. 8-1001 and amendments thereto, the person tested shall have a reasonable opportunity to have an additional test by a physician of the person’s own choosing. In case the officer refuses to permit such additional testing, the testing administered pursuant to K.S.A. 8-1001 and amendments thereto shall not be competent in evidence.”
In State v. George, 12 Kan. App. 2d 649, 652, 754 P.2d 460 (1988), this court restated the clear meaning of this statute: “If the suspect is not given this opportunity for additional testing, the State’s test is not competent in evidence.”
Although defendant argues that dismissal of the charge is the appropriate remedy for violation of 8-1001(f)(l)(E), we conclude a new trial with suppression of the breath test and any evidence obtained following defendant’s request for counsel after the breath test is the proper remedy.
Although we have found no case directly on point, the most closely analogous cases are those concerning statements obtained in violation of Miranda. In those cases, the Kansas Supreme Court has held such statements inadmissible. In State v. Boone, 220 Kan. 758, 768, 556 P.2d 864 (1976), the court ruled as inadmissible in the prosecution’s case in chief “[a]ppellant’s statement elicited after he stated he wanted to see his attorney.” See State v. Carty, 231 Kan. 282, 644 P.2d 407 (1982).
In State v. Prok, 107 Wash. 2d 153, 727 P.2d 652 (1986), the court held that, when an individual’s statutory right to counsel is denied, suppression of tainted evidence is the appropriate remedy. In that case, Prok, a Cambodian, was arrested for driving while intoxicated, his rights were explained, and he was given a breath test. Prok knew very little English, did not understand his rights, and was unaware he had a right to refuse the test or that he had a right to counsel. The trial court dismissed the case against Prok, but the Supreme Court concluded the proper remedy for such violation of the statute was suppression of the breath test.
In the present case, the statute is silent as to remedy for violation of the right to counsel provisions. K.S.A. 1987 Supp. 8-1004 provides for suppression of the breath test if the officer denies the defendant the right to secure an independent test, and analogous Kansas case law requires suppression of statements or evidence obtained in violation of Miranda. We rely upon these authorities to conclude that suppression of evidence rather than dismissal of the charge is the proper remedy for violation of K.S.A. 1987 Supp. 8-1001(f)(l)(E).
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Brazil, J.:
Richard Aldape appeals from the district court’s revocation of his probation, arguing the district court admitted an incriminating statement he made to his parole officer while in custody but without having been given Miranda warnings. We affirm.
In March 1988, Aldape entered into a plea agreement in which he was found guilty of one count of burglary as defined by K.S.A. 21-3715 and was placed on supervised probation for two years. As part of the conditions of probation, Aldape was required to maintain full-time employment when possible and to pay costs.
In May 1989, an order to show cause why probation should not be revoked was issued to Aldape. The order alleged that Aldape violated the terms of his probation by failing to make payments as authorized and failing to maintain full-time employ ment. Aldape, who was also on parole at the time, was taken into custody pending a hearing for violating the terms of his probation.
While Aldape was in jail pending the probation revocation hearing, his parole officer conducted a violation interview in which he questioned Aldape about his employment. The parole officer had contacted Aldape’s employer and had been informed that Aldape had only reported for work one day. Aldape admitted to the officer he had quit his job. The parole officer did not read Aldape his Miranda rights prior to conducting the interview. The parole officer testified at the probation revocation hearing about the conversation he had with Aldape concerning his employment.
The trial court concluded Aldape had violated his probation by failing to maintain employment and sentenced him to the custody of the secretary of corrections for a term of not less than one nor more than five years for the offense of burglary. Aldape timely appeals.
In Miranda v. Arizona, 384 U.S. 436, 16 L. Ed. 2d 694, 86 S. Ct. 1602 (1966), the Supreme Court provided protection to the privilege against self-incrimination when an individual is subject to police interrogation while in custody at the station or otherwise deprived of his freedom of action in any significant way. 384 U.S. at 477. Aldape argues that the protection against self-incrimination applies in this case and that this right was violated when the district court allowed the introduction of a statement made by Aldape to his parole officer when Aldape was in custody but had not been given Miranda warnings.
The issue of the admissibility of a probationer’s statements to his probation officer without prior warning was addressed in Minnesota v. Murphy, 465 U.S. 420, 79 L. Ed. 2d 409, 104 S. Ct. 1136, reh. denied 466 U.S. 945 (1984). In Murphy, the defendant was on probation for false imprisonment. As a condition of probation, Murphy was required to participate in a treatment program. At a counseling session, Murphy told the counselor he had raped and murdered a teenage girl. The counselor informed Murphy’s probation officer, who asked Murphy about the crime when meeting with Murphy in her office. Murphy admitted that he had committed the rape and murder. At the trial for first-degree murder, Murphy sought to suppress the statement made to the probation officer on the grounds that it was in violation of the Fifth and Fourteenth Amendments to the United States Constitution. The Minnesota Supreme Court barred the use of Murphy’s confession because the probation officer had failed to instruct Murphy as to his Miranda rights before questioning him. The United States Supreme Court reversed, holding that Murphy was not “in custody” for purposes of receiving Miranda protections since there was no arrest or restraint on freedom of movement usually associated with an arrest. 465 U.S. at 430. The Court noted that custodial arrest conveys to the suspect a message that he has no choice but to submit to the officer’s will, whereas a probation interview which takes place at the probation officer’s office does not pressure the suspect into believing he cannot terminate the meeting. 465 U.S. at 433. In reaching its conclusion, the Court stated:
“A State may require a probationer to appear and discuss matters that affect his probationary status; such a requirement, without more, does not give rise to a self-executing privilege. The result may be different if the questions put to the probationer, however relevant to his probationary status, call for answers that would incriminate him in a pending or later criminal prosecution. There is thus a substantial basis in our cases for concluding that if the State, either expressly or by implication, asserts that invocation of the privilege would lead to revocation of probation, it would have created the classic penalty situation, the failure to assert the privilege would be excused, and the probationer’s answers would be deemed compelled and inadmissible in a criminal prosecution.” 465 U.S. at 435.
The accompanying footnote provides:
“The situation would be different if the questions put to a probationer were relevant to his probationary status and posed no realistic threat of incrimination in a separate criminal proceeding. If, for example, a residential restriction were imposed as a condition of probation, it would appear unlikely that a violation of that condition would be a criminal act. Hence, a claim of the Fifth Amendment privilege in response to questions relating to a residential condition could not validly rest on the ground that the answer might be used to incriminate if the probationer was tried for another crime. Neither, in our view, would the privilege be available on the ground that answering such questions might reveal a violation of the residential requirement and result in the termination of probation. Although a revocation proceeding must comport with the requirements of due process, it is not a criminal proceeding. Gagnon v. Scarpelli, 411 U.S. 778, 782 (1973); [citation omitted]. Just as there is no right to a jury trial before probation may be revoked, neither is the privilege against compelled self-incrimination available to a probationer. It follows that whether or not the answer to a question about a residential requirement is compelled by the threat of revocation, there can be no valid claim of the privilege on the ground that the information sought can be used in revocation proceedings.
“Our cases indicate, moreover, that a State may validly insist on answers to even incriminating questions and hence sensibly administer its probation system, as long as it recognizes that the required answers may not be used in a criminal proceeding and thus eliminates the threat of incrimination. Under such circumstances, a probationer’s ‘right to immunity as a result of his compelled testimony would not be at stake,’[Citations omitted.] . . . .” 465 U.S. at 435-36 n.7.
The recent Kansas case of State v. Hartfield, 245 Kan. 431, 435-36, 781 P.2d 1050 (1989), follows the law established in Murphy. The court, holding that the defendant’s confession regarding a new crime made to his parole officer after the officer informed him of his Miranda rights was admissible, stated:
“A criminal suspect has the right to counsel during custodial interrogations under the Sixth Amendment right to counsel and the right not to incriminate oneself under the Fifth and Fourteenth Amendments. Edwards v. Arizona, 451 U.S. 477, 484-85, 68 L. Ed. 2d 378, 101 S. Ct. 1880, reh. denied 452 U.S. 973 (1981); State v. Norris, 244 Kan. 326, 332-33, 768 P.2d 296 (1989). Law enforcement officers are required to inform the suspect of his right to have counsel present during questioning under the warnings set forth in Miranda v. Arizona, 384 U.S. 436, 16 L. Ed. 2d 694, 86 S. Ct. 1602 (1966). Parole officers in Kansas are law enforcement agents required to read a parolee his Miranda rights before investigating a new felony. State v. Lekas, 201 Kan. 579, 442 P.2d 11 (1968).”
In United States v. Johnson, 455 F.2d 932 (5th Cir.), cert. denied 409 U.S. 856 (1972), the defendant had his probation revoked when he informed his probation officer he had violated his probation by attempting to sell illegal whiskey. Johnson argued the statement to his probation officer was inadmissible at the revocation hearing because he was never given a Miranda warning prior to being questioned by his probation officer. The court affirmed the district court’s refusal to apply the Miranda exclusionary rule to a probation hearing, stating:
“A probation revocation hearing is not an adversary or a criminal proceeding, Shaw v. Henderson, 430 F.2d 1116 (5th Cir. 1970); United States ex rel. Lombardino v. Heyd, 318 F. Supp. 648, 652 (E.D. La. 1970), aff'd 438 F.2d 1027 (5th Cir. 1971), but is more in the nature of an administrative hearing intimately involved with the probationer’s rehabilitation. Lombardino v. Heyd, 438 F.2d 1027. An injection of the Miranda protection here could be toxic and produce a paresis in the probation process.” 455 F.2d at 933.
Similarly, in United States v. Mackenzie, 601 F.2d 221, 222 (5th Cir. 1979), cert. denied 444 U.S. 1018 (1980), the court held that Miranda protection was inapplicable in a probation revocation hearing.
In United States v. Deaton, 468 F.2d 541 (5th Cir. 1972), cert. denied 410 U.S. 934 (1973), the court addressed the situation in which a parole officer testified regarding the commission of a new crime, harboring and concealing an escaped prisoner, by defendant Deaton. The parole officer questioned Deaton about the new crime while Deaton was in custody and without giving Deaton the Miranda warning. The court stated:
“We have considerable doubt as to the propriety of even calling the parole officer as a witness for such a purpose. But, pretermitting that, we have no doubt that the testimony was inadmissible unless the officer gave prior Miranda warnings. A parolee is under heavy psychological pressure to answer inquiries made by his parole officer, perhaps even greater than when the interrogation is by an enforcement officer. The use of admissions extracted in this manner from the parolee, in his trial on charges based on the criminal conduct inquired about, raises an issue significantly different from that in United States v. Johnson, 455 F.2d 932 (5th Cir. 1972). There we held that because a parole revocation hearing was not an adversary or a criminal proceeding but rather was an administrative hearing wherein the exclusionary rule has no application, prior Miranda warnings are not required as a condition to the admission in evidence at the revocation hearing of statements made by the parolee to the parole officer. In this instance, however, the error was not reversible.” 468 F.2d at 544.
Here, Aldape told his parole officer that he was not employed. The statement was made while Aldape was in custody and was subsequently admitted at Aldape’s probation revocation hearing. Aldape’s probation was revoked because he failed to maintain employment. Following Minnesota v. Murphy, 465 U.S. 420, and other case law, the trial court properly allowed the parole officer to testify at the revocation hearing. The parole officer was not required to give Aldape Miranda warnings as a condition to the admission of the statements Aldape made to him.
Aldape argues that imposition of his sentence was suspended before being placed on probation; therefore, until sentence is imposed, his right against self-incrimination continues to exist. Aldape relies on Estelle v. Smith, 451 U.S. 454, 68 L. Ed. 2d 359, 101 S. Ct. 1866 (1981); Mempa v. Rhay, 389 U.S. 128, 19 L. Ed. 2d 336, 88 S. Ct. 254 (1967); and State v. Rucas, 12 Kan. App. 2d 68, 734 P.2d 673 (1987), all of which are factually distinguishable. In Estelle and Rucas, the defendants had been convicted of a crime but had not been sentenced. In both cases, the respective courts held that the right against self-incrimination extends through sentencing. 451 U.S. at 462-63; 12 Kan. App. 2d at 73. In Rucas, our court, citing Ellison v. State, 65 Md. App. 321, 500 A.2d 650 (1985), aff'd 310 Md. 244, 528 A.2d 1271 (1987), went on to explain that the risk of incrimination continues until there is a finál judgment in a case and a right to appeal, and stated:
“In Kansas there is no ‘final judgment in the case’ from which an appeal can be taken until there has been both conviction and sentencing, or suspension of sentence. State v. McDaniels, 237 Kan. 767, 770, 703 P.2d 789 (1985); City of Kansas City v. Sherman, 9 Kan. App. 2d 757, 758-59, 687 P.2d 1383 (1984), City of Topeka v. Martin, 3 Kan. App. 2d 105, 590 P.2d 106 (1979).” 12 Kan. App. 2d at 72-73.
The Mempa case involves a specific law in the State of Washington in which a revocation of probation hearing becomes a deferred sentencing proceeding if the court determines that probation should be terminated. It is not applicable here.
Here, the judgment became final and appealable when the district court suspended imposition of sentence and placed Aldape on probation for two years. Aldape was under sentence from the beginning of his probation but was given conditional liberty which could be revoked if he violated the conditions of probation. Shaw v. Henderson, 430 F.2d 1116 (5th Cir. 1970). Aldape’s right against self-incrimination did not extend to the probation revocation hearing.
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Briscoe, J.:
Petitioner Richard Lewis McLain appeals the district court’s denial of his petition for a writ of habeas corpus. We affirm.
McLain was convicted by jury of kidnapping (K.S.A. 21-3420) and aggravated robbery (K.S.A. 21-3427). He was sentenced to concurrent terms of 15' years to life on each count. McLain filed a direct appeal from his conviction and sentence, alleging there was insufficient evidence to support the. convictions. The Supreme Court concluded there was sufficient evidence to support the convictions and affirmed (No. 53,631, unpublished opinion filed May 8, 1982). McLain then filed a petition for a writ of habeas corpus pursuant to K.S.A. 60-1507 wherein he asserted his convictions were unlawful because the complaint was fatally defective. Specifically, he alleged the complaint was defective as regards the aggravated robbery charge because the complaint failed to allege the robbery was “by threat of bodily harm or by force.” He also alleged the complaint was defective as regards the kidnapping- charge because it was dependent upon his conviction of aggravated robbery which should be vacated. The district court found the complaint fatally defective as to the aggravated robbery charge and vacated that conviction. The court denied McLain’s petition regarding the kidnapping conviction.
McLain contends the district court should have vacated both convictions. • He contends the district court lacked jurisdiction to convict him of kidnapping because the information was insufficient to charge that offense. K.S.A. 21-3420 defines kidnapping as “the taking or confining of any person, accomplished by force, threat or deception, with the intent to hold such person: . . . (b) To facilitate flight or the commission of any crime.” The information charging McLain read: - ■
“Richard L. McLain then and there being did unlawfully, feloniously and willfully take another, torwit: Kenneth Jones, by force or threat, with the intent to hold the same Kenneth Jones to facilitate the commission of a crime, to-wit: aggravated robbery, all in violation'of K.S.A. 21-3420.”
In support of his contention that the kidnapping charge was dependent. upon the aggravated robbery charge, McLain cites State v. Carr, 230 Kan. 322, 634 P.2d 1104 (1981). In Carr, the defendant was found guilty of aggravated burglary and attempted rape. K.S.A. 21-3716 defines aggravated burglary as “knowingly and without authority entering into or remaining within any building ... in which there is some human being, with intent to commit a felony or theft therein.” On appeal, Carr argued that the State had failed .to establish he had the specific intent to commit either aggravated burglary or attempted rape. The court held there was insufficient evidence to prove that Carr had the specific intent to commit the crime of attempted rape. The court also held that, since attempted rape was the felony on which the charge of aggravated burglary was “predicated,” Carr’s conviction for aggravated burglary was also reversed. By this reference, the court was again addressing the specific intent element and was concluding there was also insufficient evidence of specific intent to support Carr’s aggravated burglary conviction. McLain argues Carr requires dismissal of all “dependent” charges when the complaint charging the dominant felony is defective. Or, more specifically, he argues the vacation of the aggravated robbery conviction also requires the vacation of the kidnapping conviction because he cannot be convicted of facilitating a crime (aggravated robbery) that was defectively charged in the complaint. This argument is incorrect.
The information is the jurisdictional instrument on which the accused stands trial, and that information must allege each essential element of the offense charged. A conviction predicated on an information which does not sufficiently charge the offense is void. An information is sufficient if it contains the elements of the offense charged, apprises the accused of what he must be prepared to meet, and is specific enough to make a plea of double jeopardy possible. If the facts alleged in the information do not constitute an offense within the context of the statute allegedly violated, the information is fatally defective. Further, the evidence introduced at trial and the jury instructions given have no bearing on this issue. State v. Jones, 242 Kan. 385, 393, 748 P.2d 839 (1988).
Initially, it should be noted that each count in an information is regarded as a separate information and the inclusion of a faulty count does not affect the validity of the remaining counts. Gainey v. United States, 318 F.2d 795, 797 (10th Cir. 1963). Therefore, the defective complaint as to aggravated robbery does not affect the validity of the complaint charging McLain with kidnapping. The validity of the complaint charging kidnapping must be determined independently of the other charge.
The complaint charging McLain with kidnapping alleges he unlawfully, feloniously, and willfully took Kenneth Jones by force or threat in order to facilitate the commission of the crime of aggravated robbery, which is essentially the language of 21-3420. Kansas courts have consistently held an information charging an offense in the statutory language or its equivalent is sufficient. State v. Micheaux, 242 Kan. 192, 197, 747 P.2d 784 (1987). It is apparent from the statutory language that the crime of kidnapping is completed when the defendant forcefully takes another for the purpose of facilitating flight or the commission of any crime. The statute does not require a conviction or even the filing of a complaint on the underlying crime in order to properly charge the defendant with kidnapping. Further, there can be no question that McLain had the requisite intent to support a kidnapping conviction as the Supreme Court in the direct appeal of these convictions found there was sufficient evidence to uphold the kidnapping conviction. The complaint contains the elements of kidnapping and is sufficient to apprise McLain of the charge against him.
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Davis, J.:
Defendant Jonathan Young appeals his convictions for aggravated battery (K.S.A. 21-3414), abuse of a child (K.S.A. 21-3609), and obstructing legal duty (K.S.A. 21-3808) on the grounds that (1) the court erred by failing to instruct on the lesser included offense of battery; (2) the offense of child abuse merges into the offense of aggravated battery; (3) evidence of defendant’s prior wrongful acts was erroneously admitted; (4) the court erred in not giving an accomplice witness instruction; and (5) his sentence for obstructing legal duty is illegal. We agree that defendant’s sentence for obstructing legal duty should be modified to a minimum of one year rather than two years. Otherwise, we find no reversible error and affirm.
Twelve-year-old Tyson Newman was badly beaten during the late afternoon and early evening of September 18, 1987. Defendant Jonathan Young, who had been living with Tyson’s mother, Mary Caldwell, for the past four years, was arrested and charged with the crime. At trial, two different versions of events emerged.
The State’s evidence was as follows: When Tyson arrived home from school on Friday, September 18, 1987, defendant asked him if he was ashamed to be part black and part white. (Tyson is of mixed race; defendant is black, and Mary Caldwell is white.) When Tyson answered that he was not, defendant asked him if he knew what the word “conflict” meant. Tyson did not. He looked “conflict” up in the dictionary, but did not understand the definition.
At about this time, Tyson’s mother, Mary Caldwell, came home from beauty school. Defendant told her that Tyson was ashamed of himself and that Tyson was going to get a whipping. Defendant picked up a belt and began whipping Tyson with it, mostly below the waist and above the knees. When the belt broke, defendant had Mary Caldwell get him another.
After a while, Mary Caldwell suggested to defendant that they should go to the grocery store. Defendant, Mary Caldwell, and Tyson’s younger brother James went to the store and were gone about 10 to 15 minutes. Tyson did not leave while they were gone because he was hurt and could hardly move.
When they got back, defendant started whipping Tyson again. Defendant also picked Tyson up and threw him down and sat on his back so that he could hardly breathe. At some point or points during the beating, defendant got tired and ordered Mary Caldwell to continue hitting Tyson. Mary Caldwell did so because she was afraid of defendant, but she hit Tyson only lightly.
Two neighbors heard fighting and screaming from defendant’s trailer home. Through a small gap in the curtains on the window, one neighbor thought she saw defendant hitting someone quite a bit smaller than himself, although she did not actually see him strike anyone. The neighbors also saw the trailer rocking back and forth as if people were fighting or running around inside. One of the neighbors went up to the manager’s trailer and told the manager to call the police. After some delays, the manager did call the police.
Corporal Terry Ticel of the Great Bend Police Department was dispatched to the disturbance at 6:19 p.m. Officer Ray Reno, who was in a separate car, was also dispatched. They arrived at about the same time and knocked on the door. After 30 to 45 seconds, Mary Caldwell opened the door and told them that her husband was disciplining one of her boys. She invited them in. Ticel went to the back bedroom and saw defendant on the bed with Tyson lying on him. Tyson was crying.
Ticel asked defendant to come out and talk with him. Defendant answered in a very harsh voice that he was talking with his son and would come out when he was finished. After 3 to 4 minutes, Ticel repeated his request and defendant became very angry and told Ticel to leave. Defendant eventually did come out, but refused to give his name or any other information to the officers. He was very angry, had a strong odor of alcohol, and appeared to be under the influence. Officer Reno explained that the police had been called to investigate a disturbance and asked defendant if there had been a problem in the house. Defendant stated that there had not been a problem and that he was just disciplining his son.
Tyson came out. He was hunched over, walking very slowly, making low moans and groans, and crying. As Tyson came into the room, Ticel heard defendant say something to Tyson about not telling the police anything. Officer Reno asked Tyson why he was moaning, and Tyson answered that his legs hurt. Reno then asked to see Tyson’s legs and Tyson agreed to let Reno look at them if he could put a robe on. Defendant then leaned over to where Tyson was standing, and Reno heard him tell Tyson in a low voice, “[I]f you say anything, I’ll go to jail.” Tyson then went into a back room with Mary Caldwell, took off his long-legged pants, and put on a robe. Reno observed that the back of Tyson’s legs had been severely beaten, that Tyson had large, blood-filled welts on his legs, that Tyson’s backside from his buttocks to his knees were black and blue and had red welt marks, and that Tyson had a cut on his head and a scratch-type injury over his right eye. Reno asked Tyson how he had received those injuries and Tyson answered that defendant had beaten him with a belt. Reno told Ticel what he had seen and asked Ticel to look at Tyson. The two officers then conferred and decided to arrest defendant.
Defendant refused to cooperate with the arresting officers. Because of this, he was charged with and convicted of obstructing legal duty. Because he is challenging only the sentence for this conviction and not the conviction itself, the facts supporting this conviction are omitted.
Officer Reno took Tyson, James, and Mary Caldwell to the hospital, where Detective Dan Bayes took color photographs of Tyson’s injuries. At the hospital, Mary Caldwell told Detective Bayes that she had hit Tyson too. After being Mirandized, she stated that, when defendant got tired of hitting Tyson, he told her to spank Tyson, and she did for about five minutes, but tried not to hurt him. She stated that, if she had not done what defendant told her to do, he would have beaten her, too.
Defendant’s testimony differed markedly from the testimony of the State’s witnesses. He testified that, about one and one-half months before the incident, a neighborhood kid had called James or Tyson a “nigger.” He asked them how they felt and if they were ashamed of themselves. James said “no,” but Tyson said he was ashamed of being half white/half black. Defendant told Mary Caldwell about this when she got home. She got upset and spanked Tyson hard with a belt. Mary Caldwell later told defendant that she had spanked Tyson because she thought Tyson was ashamed that she “had been with a black man before.”
A few days before the incident, defendant learned that Tyson had gotten into a fight with some white boys, and defendant assumed that the fight had to do with race. On the day of the incident, after he had admittedly been drinking, he asked Tyson if he had a “conflict” with himself. Defendant explained to Tyson that he was “going to get a whipping” because defendant “figured that he was still ashamed of himself, and I was going to tell his mother when she got home.”
When Mary Caldwell got home, defendant told her that he thought Tyson was still ashamed of himself. Mary Caldwell got mad, began yelling, and began to spank Tyson with a belt. After a while, Tyson ran out yelling. Defendant grabbed him, put him on the couch, and spanked him with his hand three or four times “to show support” for Mary Caldwell’s discipline. Mary then resumed beating Tyson until they went to the store.
After they got back from the store, Mary started beating Tyson again and defendant laid down and slept on the couch. Then the police arrived and defendant went into the back room, because he wanted to avoid contact with the police after having been drinking. When he got to the back room, he found Tyson on the bed and he tried to speak with him. He admitted being angry with the officers but said it was because he did not think they should interfere with mother-son discipline and because he did not know how badly Tyson had been beaten.
The jury convicted defendant of aggravated battery, child abuse, and obstructing legal duty. The court sentenced defendant to concurrent terms of 5-20 years for aggravated battery, 3-10 years for child abuse, and 2-5 years for obstructing legal duty.
INSTRUCTION ON BATTERY
The defendant requested an instruction on the lesser included offense of battery. The court responded that “you only need to give the lesser included offense if the fact warrants the lesser included.” And, on the facts of the case, the court stated, “It’s either got to be an aggravated or it’s nothing at all.” Defendant then argued that Mary Caldwell had been implicated in the beating and that the jury could find that she had done most of it and that defendant had merely committed a simple battery. The court responded it could not accept that argument and that, if the jury felt that defendant had not done most of the beating, the jury could find him not guilty. On appeal, defendant again argues that “the evidence might have reasonably caused a jury to convict of the lesser included offense” and therefore “the court had a duty to instruct” on simple battery.
The trial court’s duty to instruct on lesser included offenses is stated in K.S.A. 21-3107(3):
“In cases where the crime charged may include some lesser crime, it is the duty of the trial court to instruct the jury, not only as to the crime charged but as to all lesser crimes of which the accused might be found guilty under the information or indictment and upon the evidence adduced.”
This statute has been the subject of numerous appellate decisions. In the most recent decision, the Supreme Court stated:
“It is a familiar rule, as codified in the statute, that a trial court has an affirmative duty to instruct the jury on lesser included offenses, including lesser degrees of the same crime; however, this duty does not arise unless there is evidence supporting the lesser offense. Further, we have held that in order for the evidence to be sufficient to require instructions on lesser included offenses, testimony supporting such instructions must be offered either by the State or the defense for the purpose of proving what events occurred.” State v. Patterson, 243 Kan. 262, 267, 755 P.2d 551 (1988).
Finally, the evidence supporting the lesser offense must be such that the jury might reasonably convict the defendant of the lesser offense. If there is no such evidence, “the instruction need not be given.” State v. Hill, 242 Kan. 68, 73-74, 744 P.2d 1228 (1987).
The question, then, in this case is whether either the State or the defense offered any evidence regarding how Tyson was injured, based on which evidence the jury might reasonably have convicted defendant of battery. We conclude that there was no such evidence.
Battery “is the unlawful, intentional touching or application of force to the person of another, when done in a rude, insolent or angry manner.” K.S.A. 21-3412. Aggravated battery “is the unlawful touching or application of force to the person of another with intent to injure that person” and which “[i]nflicts great bodily harm upon him.” K.S.A. 21-3414. Aggravated battery differs from battery in that it requires proof of “intent to injure” and of “great bodily harm.”
Defendant testified that he spanked Tyson with his hand “on his bottom” about “three or four times” to “show support” for Mary Caldwell’s disciplining of her son. He denied that he did “a whole lot more” than that. He also testified that he did not have any reason for spanking Tyson other than “to show support” for Mary.
For a battery to be committed, the touching must be “done in a rude, insolent or angry manner.” Defendant did not admit to spanking Tyson in a “rude, angry or insolent manner”; rather, he was merely disciplining a child whom he regarded as his son. His testimony, if believed, showed that he was not guilty of either aggravated battery or simple battery. An instruction on battery was therefore not required. See State v. Hill, 242 Kan. at 73-74 (an instruction on a lesser included offense is “unnecessary where the defendant’s testimony precludes a conviction for the lesser offense”).
Defendant also argues that an instruction on battery was required because the jury could have found that his intoxication negated the “intent to injure” element of aggravated battery. This contention is disposed of by State v. Garcia, 233 Kan. 589, 664 P.2d 1343 (1983). Garcia was charged with three counts of first-degree murder and one count of aggravated battery. He pled not guilty by reason of insanity and was convicted on all four counts. On appeal, he argued that the jury should have been instructed on the lesser included crime of second-degree murder since the jury could have inferred from testimony that he had been drinking earlier in the evening and that he was too intoxicated to form a premeditated intent to kill. The Supreme Court rejected this argument, stating:
“While it is true the defendant was entitled to have his theory of the case presented to the jury under appropriate instructions, intoxication was never presented by the appellant as a theory in this case, and he cannot do so for the first time on appeal. The appellant’s sole defense was insanity. The test for the giving of a lesser included instruction is not whether any theory arises under which a person could be found guilty or innocent, but whether there is sufficient evidence to support the giving of an instruction of the lesser charge. [Citation omitted.] Here the evidence would not have supported a conviction of second-degree murder. To have given the instruction on that offense ‘would have permitted the jury to speculate on a degree of homicide not in the case upon any theory.’ State v. Zimmer, 198 Kan. 479, 504, 426 P.2d 267, cert, denied 389 U.S. 933 (1967).” 233 Kan. at 610.
In this case, defendant’s defense was that he did not commit the crime, someone else did. Defendant did not defend himself on the theory that he committed the acts in question, but was not guilty because he was too drunk to form the necessary intent to injure. As the trial judge concluded, the defendant was, depending on whose testimony the jury believed, either guilty of aggravated battery or guilty of no battery at all. The trial court did not err in refusing to give an instruction on battery.
MERGER
At trial, defendant argued that the crimes of battery and child abuse merged and that the State should therefore be permitted to prosecute either one or the other, but not both. The trial court responded that it had initially leaned toward defendant’s argument, but, after researching the case law, had concluded that the offense did not merge since child abuse required proof that the victim was under the age of 18.
K.S.A. 21-3107 governs multiple prosecutions for the same act. It provides:
“(1) 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.
“(2) 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:
“(d) a crime necessarily proved if the crime charged were proved.”
In State v. Arnold, 223 Kan. 715, 716, 576 P.2d 651 (1978), Chief Justice Schroeder wrote:
“Under this section it is impossible to commit the greater offense without first having committed the lesser offense. The offense must not require some additional element which is not needed to constitute the greater offense. In other words, there must be ‘identity of elements.’ [Citation omitted.]
“Our court has consistently construed subparagraph (d) to mean a lesser included offense must not require proof of any element not necessary in the greater crime charged.”
Confusion arose, however, in subsequent opinions as the ap7 pellate courts of this state applied the “identity of the elements” test to the elements of the offenses in general rather than to the elements of the offenses as applicable to the specific case at bar. See State v. Fike, 243 Kan. 365, 369, 757 P.2d 724 (1988).
In State v. Adams, 242 Kan. 20, 23-24, 744 P.2d 833 (1987), the Supreme Court attempted to clear up this confusion. Justice Allegrucci wrote:
“What we held in Arnold, and here reaffirm, is that the test to determine ‘identity of elements’ under subparagraph (2)(d) is twofold. First, the statutes defining the lesser offense and the greater offense must be compared to determine if all the elements of the former are included in the latter. Second, if that comparison fails to disclose an ’identity of elements,’ then the court must examine the complaint/information to determine if the elements of the lesser offense are alleged, and if proof thereof is required to establish the greater offense. If it is, then it is a lesser included offense within the meaning of subparagraph (2)(d).”
Adams had been convicted of involuntary manslaughter and driving under the influence of alcohol. On appeal, he argued that his conviction for DUI merged into his conviction for involuntary manslaughter. The Supreme Court agreed:
“In the present case, it seems clear that, in order to prove the defendant guilty of the crime of involuntary manslaughter, the State was compelled to prove all the elements necessary to prove the crime of driving while under the influence of alcohol. Involuntary manslaughter is defined as
‘the unlawful killing of a human being, without malice, which is done unintentionally in the wanton commission of an unlawful act not amounting to felony, or in the commission of a lawful act in an unlawful or wanton manner.’ K.S.A. 1986 Supp. 21-3404(a).
The allegation that defendant Adams drove an automobile while under the influence of alcohol served as one of the elements of the charged crime of involuntary manslaughter. By proving all of the elements necessary to establish involuntary manslaughter, the State necessarily proved each element of the crime of driving while under the influence of alcohol, as defined by K.S.A. 1986 Supp. 8-1567. Thus, having necessarily proven the lesser offense by proving the greater offense of involuntary manslaughter, the provisions of K.S.A. 1986 Supp. 21-3107(2) prohibit finding the defendant guilty of both involuntary manslaughter and driving while under the influence' of alcohol. The necessity of alleging and proving that the defendant was driving while under the influence of alcohol precluded driving while under the influence of alcohol from being a ‘factually related offense.’ ” 242 Kan., at 24.
See also State v. Woodman, 12 Kan. App. 2d 110, 118-19, 735 P.2d 1102 (1987) (on the facts of the case, DUI was a lesser included offense of aggravated vehicular homicide because “all of the elements of driving while under the influence of alcohol are required to establish the greater offense of aggravated vehicular homicide”); and State v. Fike, 243 Kan. at 367-73 (applying two-prong Adams test, aggravated sexual battery is not a lesser included offense of indecent liberties with a child because aggravated sexual battery requires proof that thes victim did not-give actual consent and hence was not “necessarily proved” when defendant was convicted of indecent liberties with a child, which does not require proof of lack of consent). It is clear from the court’s opinion in Adams that K.S.A. 21-3702(2)(d) does not prohibit a conviction on a lesser offense unless that offense is, on the facts of the case, necessarily proven by a conviction for a greater offense.
Turning to the facts of this case, it is clear that defendant’s conviction for' child abuse does not merge into his conviction for aggravated battery. Child abuse requires proof that the victim was under the age of 18 (K.S.A. 21-3609); aggravated battery does not (K.S.A. 21-3414). Therefore, by proving all of the elements of aggravated battery, the State did not necessarily prove each of the elements of child abuse.
In In re Berkowitz, 3 Kan. App. 2d 726, 744, 602 P.2d 99 (1979), we held that child abuse does not merge into aggravated battery because it “requires a victim under 18 years of age, an element not required for aggravated battery. ” Having reexamined this holding in light of Adams, we conclude that it remains good law.
DEFENDANT’S PRIOR WRONGFUL ACTS
Defendant argues that the trial court committed reversible error in admitting the following: (1) Mary Caldwell’s testimony that James, her other son, was “dead on account of’ defendant; (2) Tyson’s testimony that defendant had spanked him before and had hit his brother and mother; and (3) Officer Reno’s testimony that James had told him that defendant had beaten James, Tyson, and Mary before. The State argues in reply that this testimony was admissible to establish the relationship of the family members, to establish a continuing course of conduct, to corroborate Mary Caldwell’s testimony, and as evidence of “res gestae.” We hold that the first statement was not improper evidence of defendant’s prior wrongful acts, and, in any event, did not prejudice defendant, that the admission of the second statement was harmless error, and that the admission of the third statement cannot be challenged on appeal because it was not objected to at trial.
Mary Caldwell’s Testimony
The first statement came out during the redirect examination of Mary Caldwell. Because it is important to read the statement in context, considerable detail about the questioning of Mary Caldwell must be given.
On direct examination, Mary Caldwell testified that she was married to Donald Caldwell, that she was separated from him, and that she had never been married to the defendant.
On cross-examination, the defense questioned Mary Caldwell about her testimony at the preliminary hearing that she and defendant were “common law” married. She answered that she and defendant had lived together for four years and that she had testified they were “common law” married because people had told her that “common law” marriage meant living together. She testified that she was not presently living with her sons, that she wanted to be reunited with her remaining son, and that getting Tyson back was the most important thing in her life and took priority over defendant. She further testified that she had • had only one contact with defendant from the time he was arrested until the preliminary hearing. However, when confronted with copies, she admitted that she had written love letters to defendant while he was in jail, that these letters expressed her hope that she, defendant, and the two boys could get together again, and that she did not mention the beating incident even once in those letters.
On redirect, the State attempted to smooth over the differences the defense had brought up between Caldwell’s testimony at the trial and her testimony at the preliminary hearing. Near the end of redirect, the State inquired about the letters she had written defendant and the following occurred:
“Q. [MS. MOORE FOR THE STATE]: Why were you writing him letters?
“A. [MARY CALDWELL]: Well, I guess because I still wanted him to be around. This is before I was going to counseling and stuff.
“Q. IIow long have you known the Defendant, ma’am?
“A. Since ’83.
“Q. How do you feel about the Defendant now?
“A. I don’t want to see him.
“Q. And why is that, ma’am?
“A. Because my baby’s dead on account of him.
“MR. McVAY [FOR DEFENDANT]: Objection, Your Honor. This is a completely different child. That had nothing to do with this.
“THE COURT: Okay.
“MS. MOORE: Your Honor, — (interrupted)
“THE COURT: Overrule. Answer was not solicited. It was just an answer to her question. I’m going to overrule the objection.
“MS. MOORE: I have nothing further, Your Honor.
“THE COURT: Recross.
“RECROSS EXAMINATION
“BY MR. McVAY:
“Q. Which child is dead, ma’am?
“A. James.
“Q. James was not touched on this occasion, September 18th; is that correct?
“A. But it’s on account he was separated — taken from me.
“Q. Ma’am, answer my question.
“On September 18th, James was not touched by this man, was he?
“A. Yes, he was.
“Q. Oh, he was?
“A. He was slapped.
“Q. Did that kill him?
“A. No. Because we was separated, that killed him.
“Q. When did he die?
“A. January.
“Q. January. Where has this man been since September 18th of 1987?
“A. In jail, I guess.
“Q. Well, you’ve been writing him there, haven’t you? You know he’s been in jail, correct?
“A. Up till the last few months.
“Q. And so you’re saying that this individual killed your child; is that what you’re saying?
“A. In a way, yes.”
On reading the statement “my baby’s dead on account of him” in context, it is apparent, contrary to the defendant’s assertion, that the statement slipped out and was not solicited by the State. It is also apparent that the statement was not “incredibly damning.” The defense clearly established on recross-examination that defendant could not have caused James’ death and that Mary Caldwell was merely blaming him for James’ death.
Defendant has not shown error in the admission of this statement. It is not improper evidence of defendant’s prior crimes or civil wrongs because Mary Caldwell did not attribute any wrongful act to defendant in connection with James’ death, and defendant does not argue that it should have been excluded on any other basis. But even if the statement was improperly admitted, it was clearly harmless beyond a reasonable doubt.
Tyson’s Testimony
Defendant also complains of Tyson’s testimony that defendant had spanked him before and had hit his brother and mother and Officer Reno’s testimony that James had told him that defendant had beaten James, Tyson, and Mary before. Again, considerable background information needs to be given.
During Tyson’s testimony on direct examination, the State went over the events of the beating in considerable detail. Near the end of direct examination, the following took place:
“Q. Tyson, had anything like this ever happened before?
“A. No.
“Q. Had you ever gotten a spanking in your life before?
“A. Yes.
“Q. Has your mom spanked you before?
“A. Yes.
“Q. Has Jonathan ever spanked you before?
“A. Yes.
“Q. Can you compare those spankings to the one you got on September 18th?
“A. The other ones, they didn’t leave no bruises on and make my legs sore.
“Q. Tyson, have you ever seen Jonathan hit anyone else?
“A. Yes.
“Q. Who?
“A. My brother and my mom.
“MR. McVAY: Your Honor, can we approach?
“THE COURT: Do you have an objection:
“MR. McVAY: Yes, Your Honor. I have an objection as that I stated earlier in my motion, and I would state my objection for the record now as to what we talked about earlier this morning.
“THE COURT: Okay. The Court would renew the ruling that it’s made earlier this morning regarding this.
“BY MS. MOORE: (Continuing)
“Q. Do you know how many times you’ve seen that happen, Tyson?
“A: A lot.
“Q. A lot.
“MS. MOORE: That’s all I have, Your Honor.”
Although it is not entirely clear from this exchange, it appears that the basis of defendant’s objection was that Tyson’s testimony was inadmissible evidence of prior wrongful acts and the court’s ruling was that this evidence was admissible to show Mary Caldwell’s state of mind.
On appeal, defendant argues that this testimony was inadmissible under K.S.A. 60-455, which provides: The principle behind this rule is simple: The fact that a person did something before is not proof that he did it again. See generally the comments to PIK Crim. 2d 52.06.
“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.”
The State concedes that Tyson’s testimony was not admissible under K.S.A. 60-455, but argues that it was admissible independent of K.S.A. 60-455 either as “res gestae” or to show the relationship of the parties, to show a course of conduct between them, and to corroborate testimony of Mary Caldwell that she was afraid of defendant because he had hit her before.
Under the concept of “res gestae,” evidence of acts or declarations before, during, or after the happenings of the principal event “may be admitted as part of the res gestae where those acts or declarations are so closely connected with the principal occurrence as to form in reality a part of the occurrence.” State v. Peterson, 236 Kan. 821, Syl. ¶ 1, 696 P.2d 387 (1985). In this case, Tyson’s statements referred to no particular incidents and had no particular time frame. No connection with the beating incident of September 18, 1987, was shown. The incidents referred to were clearly too remote to be part of the res gestae of the crime.
The Supreme Court has approved the admission of evidence of prior wrongful acts to show the relationship between the parties, to show a course of conduct, and to corroborate a victim’s testimony. However, as Judge Gard notes, the “exception” to K.S.A. 60-455 recognized by these cases has thus far been limited to cases involving sexual wrongs. 1 Gard’s Kansas C. Civ. Proc. 2d § 60-455, pp. 141-42 (1988); see State v. Crossman, 229 Kan. 384, 624 P.2d 461 (1981) (in prosecution for indecent liberties with a child and aggravated sodomy, evidence about other sexual contacts between the victim and defendant is admissible where defense strategy is to show that victim is a mentally unstable child who fantasized the charged offenses); State v. Reeves, 234 Kan. 250, 671 P.2d 553 (1983) (in prosecution for aggravated sodomy and rape, evidence of prior incidents involving defendant and victim were admissible to explain statements made by defendant and victim during charged incident); and State v. Moore, 242 Kan. 1, 748 P.2d 833 (1987) (in prosecution for rape and aggravated incest, evidence of prior sexual contacts admissible to show relationship of the parties, to establish a course of conduct, and to corroborate victim’s testimony). The Supreme Court has apparently decided that the special circumstances of cases involving sexual wrongs justify an exception to K.S.A. 60-455. There is no reason, however, to extend that exception to other cases.
We think it was error to admit Tyson’s testimony. This error, however, does not require reversal. K.S.A. 60-261 provides that no error in the admission of evidence is grounds for granting a new trial or otherwise disturbing 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 Supreme Court has interpreted this to mean that reversal is required only where the erroneous admission of evidence “is of such a nature as to affect the outcome of the trial and deny substantial justice.” State v. Walker, 239 Kan. 635, Syl. ¶ 6, 722 P.2d 566 (1986). In this case, the error did not affect the outcome of the trial and did not deny defendant substantial justice. First, substantially the same evidence was admitted without objection when Mary Caldwell testified that defendant had hit her before and had slapped James on the day of the incident. Second, and more importantly, this portion of Tyson’s testimony was not particularly important to the case. When the transcript is read in its entirety, it becomes apparent that this portion of Tyson’s testimony did not prejudice defendant. Tyson testified in considerable detail that defendant had beaten him. His testimony was corroborated nearly in full by Mary Caldwell and in part by the neighbor who thought she saw defendant hitting someone. Further support comes from the conduct of defendant himself as testified to by the police officers. Finally, defendant’s own version of events was hard to believe. Considered in the context of this evidence, Tyson’s challenged statements are insignificant.
James’ Hearsay Statements
Finally, we come to the third challenged statement: James’ hearsay statement, as testified to by Officer Reno, that defendant had beaten Mary, Tyson, and James on previous occasions. The record shows that defendant renewed his pretrial objection to James’ statements on the basis of hearsay. The record does not show that defendant objected on the basis of K.S.A. 60-455. Because defendant did not object to these statements on this ground at trial, he may not assert this ground on appeal as a basis for reversal. K.S.A. 60-404; State v. Garcia, 233 Kan. 589, 608, 664 P.2d 1343 (1983). And, in any event, even if these statements were erroneously admitted, they were clearly harmless.
ACCOMPLICE WITNESS INSTRUCTION
Because Mary Caldwell admitted that she helped the defendant beat Tyson, defendant argues that the trial court was required to give the “accomplice witness” instruction set out in PIK Crim. 2d 52.18. That instruction reads as follows:
“An accomplice witness is one who testifies that he was involved in the commission of the crime with which the defendant is charged. You should consider with caution the testimony of an accomplice.”
Defendant admits that he did not request such an instruction at trial, but argues that, under State v. Anthony, 242 Kan. 493, 749 P.2d 37 (1988), a trial court is required to give such an instruction regardless of whether it is requested. This argument lacks merit.
The longstanding rule in Kansas is that an accomplice witness instruction must be given when requested by the defense. State v. Warren, 230 Kan. 385, 400, 635 P.2d 1236 (1981); State v. Patterson, 52 Kan. 335, Syl. ¶ 5, 34 Pac. 784 (1893). In Anthony, the Supreme Court held that an accomplice witness instruction may also be given, over the defendant’s objections, when requested by the prosecution. 242 Kan. at 498-502. The Supreme Court did not hold that there was an independent duty to give such an instruction when neither side requests it. Assuming, without deciding, that Mary Caldwell was an accomplice witness, defendant was not entitled to an accomplice witness instruction because he did not request one.
DEFENDANT’S SENTENCE
Defendant was convicted of obstructing legal duty, a class E felony. For this offense, the trial court sentenced defendant to a term of 2-5 years. At the time defendant was sentenced, the sentencing statute for class E felonies was ambiguous. It provided that the sentence for class E felonies “shall be an indeterminate term of imprisonment, the minimum of which shall be fixed by the court at not less than one year and the maximum of which shall be fixed by the court at not less than two years nor more than five years.” K.S.A. 1987 Supp. 21-4501(e). Although the legislature intended the minimum to be one year and the maximum to be between two and five years, some courts read this statute as setting the minimum at between one and two years and the maximum at five years. The 1988 legislature amended the sentencing statute to clear up this ambiguity, and it amended K.S.A. 21-4501a(b) to read as follows:
“If an individual has been sentenced to a minimum term of imprisonment of more than one year for a class E felony and the sentence was imposed on or after May 17, 1984, such minimum sentence is hereby reduced to one year.”
The State admits that defendant’s minimum sentence is illegal and argues only that we should correct the sentence ourselves rather than remanding for resentencing. Because K.S.A. 21-4501a(b) itself corrects defendant’s sentence, the correction of defendant’s record of sentencing is merely a clerical matter and no sentencing hearing is required. On remand, the trial court is directed to correct the record of defendant’s sentence.
Convictions affirmed. Remanded with directions to correct defendant’s sentence for obstructing legal duty. | [
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Larson, J.:
Robert L. Montgomery appeals from his convictions by a jury of three counts of making a false writing contrary to K.S.A. 21-3711.
On June 15, 1988, Montgomery went to Jay Wolfe Honda in Kansas City, Kansas, with the intention of purchasing a Honda Accord, a Pontiac Trans Am, and a pickup. He planned to trade in two cars and a pickup.
During the course of the negotiations, checks were filled out for the Honda and for the Trans Am. A third check was signed but not filled in. The third check was signed on June 15 but dated June 18.
The checks Montgomery executed were starter checks drawn on the account of Martin Clark at the Jackson County State Bank of Kansas City, Missouri. The checks did not have the name of the account holder printed on them. Montgomery did not know Clark and did not have permission to use the checks. The two completed checks were signed by Montgomery with the notation “hold for 24 hours” below the signature line.
Edward McFadden, Jay Wolfe’s sales manager, testified that Montgomery left the two checks for the amount of the cars with instructions to “run the check” if he did not have the cash as promised.
Montgomery testified that he told McFadden he did not have cash for the cars but would need to arrange financing. He intended to trade in the pickup he was driving and to leave it at the lot so the new vehicles would be held for him, but as he was cleaning out the pickup, he discovered the starter checks. Montgomery said McFadden suggested he leave checks rather than the pickup. Montgomery said he told McFadden the checks were not his, but Montgomery admitted agreeing tp the plan.
There were numerous conversations, telephone calls, attempts to obtain title to trade-ins, and other dealings between the parties not material to the issue herein which resulted in Jay Wolfe Honda reporting the Honda and Trans Am as stolen. The vehicles were ultimately returned. Montgomery was charged with but acquitted of two counts of felony theft, in addition to the three counts of making a false writing, for which he was found guilty.
Montgomery appeals the denial of his motions for new trial and judgment notwithstanding the verdict, and his application for probation.
Montgomery raises several issues on appeal, but we will consider only the one we deem controlling.
Montgomery was charged with making a false writing under K.S.A. 21-3711. Montgomery contends this is a general statute and that he should have been charged under the more specific statute of giving worthless checks in violation of K.S.A. 21-3707. We agree.
K.S.A. 21-3711 provides:
Making a false writing. Making a false writing is making or drawing or causing to be made or drawn any written instrument or entry in a book of account 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.
“Making a false writing is a class D felony.”
A “written instrument” is defined by K.S.A. 21-3110(25) as:
“any paper, document or other instrument containing written or printed matter or the equivalent thereof, used for the purposes of reciting, embodying, conveying or recording information, and any money, token, stamp, seal, badge, trademark, or other evidence or symbol of value, right, privilege or identification, which is capable of being used to the advantage or disadvantage of some person.”
K.S.A. 21-3707 relating to the giving of a worthless check provides in material part:
“(1) Giving a worthless check is the making, drawing, issuing or delivering or causing or directing the making, drawing, issuing or delivering of any check, order or draft on any bank, credit union, savings and loan association or depository for the payment of money or its equivalent with intent to defraud and knowing, at the time of the making, drawing, issuing or delivering of such check, order or draft, that the maker or drawer has no deposit in or credits with the drawee or has not sufficient funds in, or credits with, the drawee for the payment of such check, order or draft in full upon its presentation.
“(3) It shall be a defense to a prosecution under this section that the check, draft or order upon which such prosecution is based:
“(a) Was postdated, or
“(b) was given to á payee who had knowledge or had been informed, when the payee accepted such check, draft or- order, that the maker did not have sufficient funds in the hands of the drawee to pay such check, draft or order upon presentation.
“(4) Giving a worthless check is a class E felony . . . .”
The rule in Kansas regarding specific statutes versus general statutes is well settled.
“Repeals by implication are never favored and a general and specific statute should be read together and harmonized wherever possible. But to the extent of repugnancy between a statute dealing generally with a subject and another statute dealing specifically with a subject, the specific statute is favored and controls. [Citations omitted.]” State v. Makin, 223 Kan. 743, 745, 576 P.2d 666 (1978).
See State v. Keeley, 236 Kan. 555, 560, 694 P.2d 422 (1985).
“ ‘A statute which relates to persons or things as a class is a general law, while a statute which relates to particular persons or things of a class is special.’ ” Seltmann v. Board of County Commissioners, 212 Kan. 805, 810, 512 P.2d 334 (1973) (quoting 82 C.J.S., Statutes § 163, p. 277).
The Kansas Supreme Court in State v. Wilcox, 245 Kan. 76, 775 P.2d 177 (1989), construed K.S.A. 21-3711 by holding that welfare fraud must be prosecuted under the specific statute, K.S.A. 39-720, and reasoned that making a false writing is not a specific statute because charges under it may range from falsifying bank statements to making false statements under the campaign finance act. See State v. Kee, 238 Kan. 342, 711 P.2d 746 (1985); State v. Doyen, 224 Kan. 482, 580 P.2d 1351 (1978).
.The Wilcox court cited State v. Wilson, 11 Kan. App. 2d 504, 728 P.2d 1332 (1986), as persuasive. In Wilson, a state employee was convicted of presenting a false claim in violation of K.S.A. 21-3904 and also with presenting a claim for expenses which were not in fact incurred contrary to K.S.A. 75-3202. Both claims arose out of the same act. Our court held that K.S.A. 75-3202 is specific as it deals with a particular class (state employees) and addresses a specific subject (presenting an account for expenses not incurred). Wilson, a state employee, was within the particular class addressed by K.S.A. 75-3202, which was the proper and exclusive statute under which he could be charged. The conviction under the general statute, K.S.A. 21-3904, was reversed.
There are several additional cases which deal with charging the defendant with both the general crime as well as the specific crime. State v. Helms, 242 Kan. 511, 513, 748 P.2d 425 (1988) (complaint not defective for charging rape; rape not a more general crime than indecent liberties with child); State v. Kliewer, 210 Kan. 820, 504 P.2d 580 (1972) (person charged with the specific crime of turning back an odometer on a motor vehicle, K.S.A. 8-611[b], cannot also be charged with the general crime of a deceptive commercial practice, K.S.A. 21-4403).
The State contends that the legislative intent stated in State v. McConnell, 9 Kan. App. 2d 688, 689-90, 688 P.2d 1224 (1984), that “[t]he worthless check statute [K.S.A. 21-3707] was intended ‘to stop the mischievous practice of overdrafting and “check-kiting’’ by the issuance of no funds checks,’ ” (quoting Foor v. State, 196 Kan. 618, 620, 413 P.2d 719 [1966]), is controlling. The State thereby claims that one must have an account to overdraw before a worthless check charge can be made and that the specific statute does not apply because Montgomery was not the holder of the account upon which the check was written.
The State’s argument requests an interpretation of the bad check statute which is too narrow. The statute relating to the giving of a worthless check is broad enough to encompass the present situation. The document may be any check, order, or draft on any bank for the payment of money. The maker must know, at the time he gives the paper, that he does not have a deposit in or credits with the bank. The language of K.S.A. 21-3707 does not limit its application to only those cases of insufficient fund checks where a deposit actually exists or has recently existed.
McConnell does not limit application of K.S.A. 21-3707 to only those cases where the accused actually holds an account in the bank on which the check is written. The principal issue in McConnell was intent. The court did not have before it a situation where the maker did not presently have and never had an account with the drawee bank.
Montgomery’s contention that he should have been charged under K.S.A. 21-3707 is correct. Montgomery executed checks that were not his. The checks are false writings; however, if the legislature had intended for 21-3707 to apply only to a limited class of checks, it would have to had said so in order for us to so limit the statute’s application.
The State’s argument that these writings were not checks so that K.S.A. 21-3707 does not apply is without merit. The State has no legal precedent for its argument that because Montgomery had no authority from the issuing bank to make the writings the documents he wrote could not be checks. K.S.A. 84-3-104(2)(b) defines a check as “a draft drawn on a bank and payable on demand.” The necessity for authority from the issuing bank is not a part of this definition.
It also appears that because the prosecution was based on the general crime Montgomery was deprived of the potential defense that Jay Wolfe Honda had knowledge of or had been informed that the maker did not have sufficient funds in the hands of the drawee bank to pay the check upon presentation. K.S.A. 21-3707(3)(b). There was evidence to support Montgomery’s defense that Jay Wolfe Honda knew the checks were worthless. McFadden testified that once the pickup and trailer left Wolfe’s lot it had no other security.
There also could have been another potential defense available to Montgomery because one check was postdated and two others were to be held for 24 hours. K.S.A. 21-3707(3)(a).
The specific statute of giving a worthless check rather than the general statute of making a false writing must be the basis for the crimes charged. Montgomery’s convictions are reversed. | [
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Lewis, J.:
This is an appeal by Robert H. Dunn and Cheri Dunn (the insureds) from the granting of summary judgment in favor of the defendants/appellees, hereinafter referred to as the insurance company.
After careful review, we affirm.
The facts of this case indicate that the insureds approached the insurance company’s agent seeking to purchase insurance covering a 1988 pickup. In order to obtain coverage, the insureds were required to complete an application, and this application was completed and signed by Cheri Dunn. In the application, Cheri Dunn represented that no driver of the vehicle had ever had his or her driver’s license revoked or suspended. She also indicated that Robert Dunn would drive the vehicle approximately ten percent of the time. After the application was completed, it was turned over to the insurance agent along with a check for $124. In response to the receipt of the application and the check for the premium, the insurance agent issued a “binder” showing that coverage was in effect.
When the application reached the insurance company’s main offices, a search of the state motor vehicle records was undertaken and compared to the facts of the application. This search revealed that the insureds had not been truthful in supplying the information on the application. The motor vehicle department records revealed that Robert Dunn’s driver’s license had been suspended several times and had been cancelled once since 1986.
At this point, it becomes important to note with particularity the dates on which subsequent events took place. On May 17, 1989, after it had discovered Robert’s true driving record, the insurance company mailed a notice to the insureds. This notice was sent by certified mail to the address shown on the application and advised the insureds that no policy had ever been in effect as a result of their misrepresentations. The insurance company also enclosed in that notice a check for the “full return premium.” The insureds testified they did not receive this notice, stating that they had moved from the address listed on their application. The insurance company again sent notices to the same address on May 24 and June 3, 1989. Neither notice was received by the insureds.
On May 19, 1989, the agent sent a letter to the insureds. This letter was sent by regular mail and was received by the insureds. In the letter, the agent advised the insureds that their policy with the insurance company would become void in the near future. The agent offered to find other coverage for the insureds and advised that, if she had not heard from them by May 26, 1989, she would assume that coverage had been obtained elsewhere.
On May 28, 1989, the insureds wrecked their pickup in a one-vehicle accident, causing damage to that pickup in the amount of $9,600. There were no other vehicles or parties involved, and the insureds themselves are the sole “loss payees” under the policy.
We note that the insureds had received actual notice from their insurance agent that their policy was about to be cancelled several days prior to the accident involving .their pickup. After their accident, the insureds demanded payment of their damages under the policy. The insurance company denied payment on the grounds that it had rescinded the policy ab initio due to the misrepresentations made by the insureds on the application. The insureds then filed this action, seeking to recover damages for breach of contract.
The insureds argue that the provisions of K.S.A. 1989 Supp. 40-3118(b) apply and that, despite their misrepresentations, the policy or “binder” could only be cancelled in strict accordance with that statute. That statute reads in relevant part:
"(b) 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.” (Emphasis added.)
It is apparent that, if the above-quoted statute applies to this factual situation, rescission ab initio would not be permitted, and the insurance company would be required to have given the insureds at least 30 days’ notice of termination.
The question presented for our resolution is one of first impression in this state. We must determine whether K.S.A. 1989 Supp. 40-3118(b) is controlling under these facts. To put the question even more succinctly, we must determine whether the common-law right of rescission ab initio has been abrogated by our “no-fault insurance” law.
We first note that the insurance company argues that it is significant that it only issued a “binder” in the instant matter. It argues that the statute only applies to an insurance policy and, hence, has no application to the rescission or the cancellation of a binder. We do not agree with the insurance company’s binder/ policy distinction. This issue was considered in Sentry Indemnity Co. v. Sharif, 248 Ga. 395, 282 S.E.2d 907 (1981). In that case, the insurance company sought to avoid the binding precedent of a prior decision by arguing the difference between a binder and a policy. The Georgia court, in rejecting this argument, held:
“The Court of Appeals applied the Pearce holding in this case thereby allowing recovery on a binder the insurance company had sought to declare void ab initio on the basis that the insured had made material misrepresentations in applying for the insurance.
“Sentry, the insurer, argues that there are factual differences between this case and Pearce in that only a binder had been issued in the instant suit, whereas a policy, presumably after full investigation, had been issued in Pearce. . . .
“We agree with the Court of Appeals that the binder/policy distinction is of no consequence insofar as retrospective cancellation is concerned.” 248 Ga. at 396.
We agree with the Georgia court and hold that the binder/ policy distinction is of no importance in the resolution of this dispute.
There is no question but that, at common law, the right of rescission ab initio for fraud and misrepresentation was available to an insurance company. See, e.g., 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).
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 Supp. 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.
California has adopted a unique rule. In Barrera v. State Farm Mut. Auto. Ins. Co., 71 Cal. 2d 659, 79 Cal. Rptr. 106, 456 P.2d 674 (1969), the California court held that, in cases where it was shown that an insurance company had conducted a reasonable investigation of insurability within a reasonable time from the issuance of the policy, it retained the right to rescind; otherwise, it did not.
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 intentional 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.
We adopt the reasoning of the Michigan , court and hold that, in a case involving only the insurance company and. its insured, the insurance company has the right to rescind the policy ab initio as to the claims of an insured for collision benefits under a policy obtained through misrepresentation.
To hold otherwise would permit an insured to benefit from his or her fraudulent misrepresentations and would leave the insurance company without a remedy to protect itself from such fraud. There is simply no pressing public policy reason for such a holding.
Further, we hold that, under the circumstances presented, the courts may sever the noncompulsory provisions from the insurance policy and permit rescission only as to those provisions not required by our no-fault law. K.S.A. 1989 Supp. 40-3118(b) applies only to cancellation of automobile liability insurance policies and, thus, has no application to the rescission or cancellation of the “collision” or nonliability features of a policy which apply only to the insured.
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.
The insureds argue that our decision to allow the insurance company to rescind visits a “cruel injustice” upon them. We do not agree. Any hardships occasioned by our decision are the result of the failure of the insureds to honestly answer all questions in the application for insurance.
We further hold that, under the facts of this case, the insureds were adequately notified of the decision to rescind. The insurance company attempted to notify the insureds by sending the notice by registered mail to their last known address. We hold that such a mailing imparts sufficient notice even though the insureds may not have received the mailing. Feldt v. Union Ins. Co., 240 Kan. 108, 726 P.2d 1341 (1986). Further, the insureds admit receiving notice from their insurance agent prior to the damage to their pickup. Based on the entire record, we conclude the insureds •were adequately notified of the decision to rescind.
Affirmed. | [
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Abbott, C.J.:
This is a direct appeal by Kelly Shaffer from his adjudication as a habitual violator pursuant to K.S.A. 8-284 et seq.
Shaffer argues the trial court’s failure to comply with the certification requirements of K.S.A. 1989 Supp. 8-2115(b) deprived the court of jurisdiction to commence this proceeding. The cited statute requires every judge or clerk of the court in which a traffic conviction was had to prepare and forward to the division of motor vehicles a certified abstract of the record of the proceedings in which the defendant was convicted.
Shaffer relies on State v. Topping, 8 Kan. App. 2d 467, 660 P.2d 578 (1983), to support his argument. In Topping, the defendant was adjudicated a habitual violator by the district court. His record included three convictions for driving under the influence of alcohol and a “bail forfeiture” for the charge of driving while his driver’s license was suspended. The State conceded one of the drunk driving charges was reduced to reckless driving, an offense not listed in K.S.A. 8-285. The record of the bail forfeiture offense did not include a certification from the judge or clerk of the court attesting to the accuracy of the record. The defendant argued that, in the absence of such certification, the State could not rely on the record for his adjudication as a habitual offender. This court held the provisions of 8-2115(b) requiring that the abstract of conviction from the county to the division be certified are mandatory. The bail forfeiture offense could, therefore, not be relied upon in the proceeding, and the habitual violator adjudication was reversed.
This case is distinguishable from Topper. Topper requires the records of the convictions to be certified when the habitual violator proceeding takes place according to the statutory procedure. The procedure for adjudicating a person a habitual violator is set forth in K.S.A. 8-286:
“Whenever the flies and records of the division shall disclose that the record of convictions of any person is such that the person is an habitual violator, as prescribed by K.S.A. 8-285 the division forthwith shall certify a full and complete abstract of such person’s record of convictions to the district or county attorney of the county where such person resides .... Upon receiving said abstract, the district or county attorney forthwith shall commence prosecution of such person in the district court of such county, alleging such person to be an habitual violator.”
The State did not use the statutory procedure in this case. The prosecution did not introduce a certified abstract of Shaffer’s three convictions from the division of motor vehicles. Instead, the trial court took judicial notice of Shaffer’s previous convictions from its own records.
In State v. Skeen, 3 Kan. App. 2d 231, 592 P.2d 150 (1979), this court held the statutory procedure is not the exclusive method of adjudicating a person to be a habitual violator. In Skeen, the State offered, and the court received into evidence, a copy of the complaint issued on each of the defendant’s convictions. On the back of each was an abstract of the record of the municipal court showing the charge, the plea, and the final disposition. The defendant argued the provisions of K.S.A. 8-286 required the division of motor vehicles to certify a full and complete abstract of his record of convictions to the county attorney in order for proceedings to be commenced.
Although this court questioned why the State failed to utilize the procedure outlined in K.S.A. 8-286, it reversed the lower court’s dismissal of the complaint. 3 Kan. App. 2d at 233. Skeen holds that, although the statutory procedure is the preferred method, it is not the exclusive method of adjudicating a person a habitual violator. When the statutory procedure is not used, the Skeen court stated: “The court is to make the determination of whether the convictions are such as to constitute the accused an habitual violator under the act; and when jurisdiction has attached, that determination may be based upon any competent evidence.” 3 Kan. App. 2d at 233.
The competent evidence in this case is the trial court’s own records. See Smith v. State, 199 Kan. 293, 295, 429 P.2d 103 (1967). The State’s failure to follow the statutory procedure does not mandate reversal.
Shaffer further argues a nolo contendere plea to the offense of driving while suspended cannot be used as one of the three convictions required to adjudicate a person a habitual violator.
K.S.A. 22-3209(2) provides:
“A plea of nolo contendere is a formal declaration that the defendant does not contest the charge. When a plea of nolo contendere is accepted by the court, a finding of guilty may be adjudged thereon. The plea cannot be used against the defendant as an admission in any other action based on the same act.”
In State v. Holmes, 222 Kan. 212, 563 P.2d 480 (1977), the Kansas Supreme Court analyzed the effect of a plea of nolo contendere. In Holmes, the defendant entered a plea of nolo contendere to the offense of attempted aggravated robbery. Following the acceptance of the plea but prior to sentencing, the defendant was charged with involuntary manslaughter and unlawful posses sion of a firearm. The issue on appeal was whether the defendant had the status of a convicted felon when he possessed the firearm. The court held that under K.S.A. 22-3209(2), “when a court accepts a tendered plea of nolo contendere and adjudges a finding of guilt thereon, the defendant at that point has been convicted of the offense covered by the plea of nolo contendere.” 222 Kan. at 214.
Shaffer, therefore, stood convicted when his plea of nolo contendere was accepted. K.S.A. 1989 Supp. 8-253(c).
Shaffer argues the fact that “conviction” is defined in K.S.A. 1989 Supp. 8-285(b) to include a nolo contendere plea to the offenses specified in 8-285(a)(2), when coupled with the fact that 8-285 is silent as to the effect of a nolo contendere plea to the enumerated offenses in 8-285 other than 8-285(a)(2), indicates a legislative intent not to allow a court to use a nolo contendere plea to a charge of driving while suspended as a conviction in habitual violator proceedings.
This argument is refuted by the logic of State v. Holmes. A person who pleads nolo contendere has been convicted of the offense. Furthermore, under Shaffer’s argument, a person who pleaded nolo contendere to twenty offenses under K.S.A. 1989 Supp. 8-285(a), other than K.S.A. 1989 Supp. 8-285(a)(2), could not be adjudicated a habitual violator. Such a result would contravene the legislature’s intention. See In re Olander, 213 Kan. 282, 285, 515 P.2d 1211 (1973) (Latin maxim expressio unius est exclusio alterius should not be applied to defeat a clearly contrary legislative intention).
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Rogg, J.:
Debbra Spor and Demita Jo Elliott appeal from the trial court’s dismissal of their action for wrongful withholding of wages. ...
Spor and Elliott filed a class action lawsuit in district court alleging that Presta Oil Company, Inc., was wrongfully withholding wages. They made various claims under K.S.A. 44-313 et seq., the Kansas Wage Payment Act, and a claim for violation of the Fair Labor Standards Act of 1938, 29 U.S.G. § 201 et seq. (1988). Plaintiffs requested a declaratory judgment that Presta’s practice was wrongful; an injunction against such practices by Presta; plus actual, statutory, and punitive damages.
The class was never certified. Presta moved to dismiss, arguing that actions under the wage payment act must be brought with the Secretary of Kansas Department of Human Resources.
The district court dismissed the case.
The basis for the dismissal was that the plaintiffs have failed to exhaust their administrative remedies pursuant to the Kansas Wage Payment Act, K.S.A. 44-313 et seq.
In the Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-612 provides: “A person may file a petition for judicial review under this act only after exhausting all administrative remedies.” Here, plaintiffs did not seek judicial review of an agency action; they initially sought to bring their case before a district court.
The issue presented is the question of concurrent jurisdiction of the district court and the Kansas Department of ,Human Resources.
Can plaintiffs choose their forum by initially filing their claim with the district court or the Department of Human Resources?
K.S.A. 44-322 and K.S.A. 1989 Supp. 44-322a establish a comprehensive administrative remedy for claims for back wages. K.S.A. 44-324(a) provides: “Any proceeding by one or more employees to assert any claim arising under or pursuant to this act may be brought in any court of competent jurisdiction.” This is clear, unambiguous language granting courts concurrent jurisdiction with the Secretary of Human Resources to hear back wage claims.
Although this question has not been considered on appeal by a Kansas court previously, there are at least six reported appellate cases where an employee had brought a claim directly in district court. See Temmen v. Kent-Brown Chev. Co., 227 Kan. 45, 605 P.2d 95 (1980); Wells v. Davis, 226 Kan. 586, 603 P.2d 180 (1979); Head v. Knopp, 225 Kan. 45, 587 P.2d 867 (1978); Holder v. Kansas Steel Built, Inc., 224 Kan. 406, 582 P.2d 244 (1978); McGowen v. Southwestern Bell Tel. Co., 215 Kan. 887, 529 P.2d 97 (1974); Benjamin v. Manpower, Inc., of Wichita, 3 Kan. App. 2d 657, 600 P.2d 148 (1979).
One federal case, Smith v. MCI Telecommunications Corp., 124 F.R.D. 665 (D. Kan. 1989), did touch on K.S.A. 44-324(a). Smith stands for the proposition that at least where an employee asserts a claim under the wage payment act and under statutes over which the Secretary of the Kansas Department of Human Resources would have no jurisdiction (RICO), the employee may proceed directly in a trial court. Because the holding of Smith is limited and it is not binding precedent, it is relatively unimportant for purposes of this case.
At least two other states have a statutory provision. identical to 44-324(a) — Idaho and Wyoming. Although the Wyoming provision has not been interpreted, Idaho clearly allows claims to be brought directly in district court pursuant to Idaho Code § 45-617 (1989 Supp.). See Schoonover v. Bonner County, 113 Idaho 916, 750 P.2d 95 (1988); Rodwell v. Serendipity, Inc., 99 Idaho 894, 591 P.2d 141 (1979).
It seems to us that the language of K.S.A. 44-324(a) controls. “The fundamental rule of statutory construction is that the intent of the legislature governs. [Citation omitted.] When construing a statute, a court 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). The legislature’s intent, based on its clear, unambiguous language, is that a claim for wages may be brought directly in district court by an employee.
We reverse the trial court, finding that the dismissal was not required and, therefore, remand for further proceedings consistent with this opinion.
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Royse, J.:
This is an action for a declaratory judgment. Plaintiffs sought a determination that a homeowners insurance policy issued by defendant Western Indemnity Co., Inc., to defendants Anthony and Loretta Donnelly provided coverage for injuries sustained by Cody Susnik.
Loretta Donnelly began babysitting Craig and Doris Susnik’s two children on a regular basis in September 1985. Loretta Donnelly cared for four or five other children at that time, for which she received payment. Some of the children were cared for on a part-time basis. Loretta Donnelly did not hold any type of license for babysitting or child care.
On November 26, 1985, Cody Susnik was seriously injured while in the care of Loretta Donnelly. Plaintiffs alleged that Loretta Donnelly left Cody Susnik and other children unsupervised and that Cody Susnik met with serious personal injuries at the hands of another unsupervised minor child. The precise manner in which Cody Susnik was injured remains in dispute: Plaintiffs claim that Loretta Donnelly’s youngest son jumped on Cody, pulled Cody’s arms behind him, and tried to ride Cody like a pony.
Defendant Western Indemnity filed a motion for summary judgment. The trial court sustained that motion, concluding that the homeowners policy did not provide coverage.
Plaintiffs’ first argument on appeal is that the trial court erred in ruling that the “business pursuits” exclusion applied to babysitting. The policy provides:
“1. Coverage E — Personal Liability and Coverage F — -Medical Payments to Others do not apply to bodily injury or property damage:
b. arising out of business pursuits of any insured ....
This exclusion does not apply to:
(1) activities which are ordinarily incident to nonbusiness pursuits . . . .”
The policy further defines “business” to include “trade, profession or occupation.”
The Kansas Court of Appeals considered the “business pursuit” exclusion in Krings v. Safeco Ins. Co. of America, 6 Kan. App. 2d 391, 628 P.2d 1071 (1981). The court held:
“A business pursuit is constituted of two elements: continuity and profit motive. As to the first, there must be a customary engagement or a stated occupation; as to the latter, there must be shown to be such activity as a means of livelihood, gainful employment, procuring subsistence or profit, commercial transactions or engagements.” 6 Kan. App. 2d 391, Syl. ¶ 5.
The record in this case demonstrates that Loretta Donnelly provided babysitting services for pay as far back as 1981. During 1984 and 1985 she provided care for four to five children for money. Loretta Donnelly charged between six and eight dollars per day per child. She received twelve dollars per day for caring for Cody Susnik and his brother, who was there part of the day. Her 1985 tax return listed her principal business as “child day care” and reflected gross receipts of $4,024.50 from babysitting. The Donnellys listed Loretta’s babysitting as a source of household income.
The record provides a substantial basis for concluding that Loretta Donnelly’s babysitting met the criteria of continuity and profit motive. Plaintiffs’ arguments, focusing on the fact that babysitting may be conducted on an irregular or voluntary basis, have no application here. The trial court did not err in holding that the “business pursuits” exclusion applied.
The plaintiffs’ second argument on appeal is that the trial court erred in holding the exception to the exclusion for nonbusiness activities did not apply. Plaintiffs contend that the exception applies because child care is ordinarily incident to nonbusiness pursuits; that if the policy language requires consideration of the specific activity causing the injury, then summary judgment is inappropriate when the specific cause of the injury has not been determined; or that the policy language is ambiguous and must be given the construction most favorable to the insured. Western Indemnity contends that supervision of children for compensation is ordinarily a business pursuit.
The Kansas Supreme Court recently discussed the “business pursuit” exclusion and the exception for activities “ordinarily incident to nonbusiness pursuits” in Heinson v. Porter, 244 Kan. 667, 772 P.2d 778 (1989). Rejecting the trial court’s conclusion that the exclusion and exception are ambiguous, the court stated:
“The exclusion in the policy clearly excluded business activities and the day care operation was a business endeavor. The district court then proceeded upon a tortured path to hold that, while the day care operation was a business activity, the specific act of negligence claimed arose from a non-business pursuit (checking on her barking dog and leaving the child unat tended while so checking). This reasoning is inappropriate. Presumably, if an automobile rolls off a hoist at a repair shop and injures someone while the serviceman is tying his shoelace, the accident occurred as a result of a nonbusiness pursuit. Mrs. Porter was being paid to care for the child — this was her business. It matters not for coverage purposes whether Mrs. Porter left the child unattended to check on her barking dog or to get a clean diaper for the child.” 244 Kan. at 672-73.
A number of other jurisdictions have addressed the “business pursuits” exclusion with its exception for activities ordinarily incident to nonbusiness pursuits. See generally Annot., Construction and Application of “Business Pursuits” Exclusion Provision in General Liability Policy, 48 A.L.R.3d 1096, 1107-09. One line of cases has focused on the particular activity of the babysitter at the time of the injury. These cases reflect a belief that the policy emphasizes the “activity,” whether the activity was the legal cause or merely an indirect cause of injury. See, e.g., George v. Breising, 206 Kan. 221, 227, 477 P.2d 983 (1970). Thus, Gulf Insurance Company v. Tilley, 280 F. Supp. 60 (N.D. Ind. 1967), aff'd 393 F.2d 119 (7th Cir. 1968), held that brewing coffee was an activity within the exception, and coverage was afforded for liability to a child who sustained burns when the babysitter’s coffeepot fell over; Nationwide Mutual Fire v. Collins, 136 Ga. App. 671, 222 S.E.2d 828 (1975), concluded that maintaining heat for the home was an activity ordinarily incident to nonbusiness pursuits and extended coverage when a babysitter placed a child on the floor to change its diaper and the child burned its hand on a floor furnace grill; and State Farm Fire & Casualty Co. v. Moore, 103 Ill. App. 3d 250, 430 N.E.2d 641 (1981), applied the exception to preparation of lunch for the household, when a child pulled a pan of boiling water on himself in the babysitter’s kitchen.
Other cases have examined the “activity” and concluded the policy did not afford coverage, taking the view that an activity may be incident to a business pursuit or incident to a nonbusiness pursuit, but not both. Courts adopting this “either/or” approach to the “activity,” in other words, seem to read the policy to require that the activity be ordinarily incident to nonbusiness pursuits and that the activity not be incident to the insured’s business pursuit, if the exception is to apply. Decisions which have utilized this approach to the particular activity are Economy Fire & Casualty Co. v. Bassett, 170 Ill. App. 3d 765, 525 N.E.2d 539 (1988), refusing to extend coverage for a child struck by a car in the babysitter’s driveway, as use of the driveway to pick up children is associated with a babysitter’s business pursuit even though it may also be a nonbusiness activity; and Aetna Life and Casualty v. Ashe, 88 Or. App. 391, 745 P.2d 800 (1987), rev. denied 305 Or. 103 (1988), affirming a trial court judgment that vacuuming is incident to a babysitter’s business pursuits (child suffered fatal electrical burns from vacuum cord).
A second line of cases takes a more general view of the “activity” of the insured. Those which view the relevant “activity” as “child care” or “supervision of children” or “maintenance of a safe environment for children” frequently conclude that the activity is ordinarily incident to a nonbusiness pursuit. Crane v. State Farm Fire & Cas. Co., 5 Cal. 3d 112, 117, 95 Cal. Rptr. 513, 485 P.2d 1129 (1971) (“[I]t is difficult to conceive of an activity more ordinarily incident to a noncommercial pursuit than home care of children.”); Bankers Standard Ins. Co. v. Olwell, 309 N.W.2d 799 (Minn. 1981); Western Fire Ins. Co. v. Goodall, 658 S.W.2d 32 (Mo. App. 1983); Robinson v. Utica Mut. Ins. Co., 585 S.W.2d 593 (Tenn. 1979). See also 7A Appleman, Insurance Law and Practice § 4501.10, p. 280 (Rerdal ed. 1979): (“There are few activities more ‘incident to nonbusiness pursuits’ than taking care of babies.”). These cases reject the either/or approach to business and nonbusiness activities. They seem to operate from the premise that an activity may be associated with the insured’s business pursuit and still be ordinarily incident to nonbusiness pursuits. See 7A Appleman, Insurance Law and Practice § 4501.10, p. 277; Frazier, The “Business Pursuits” Exclusion in Personal Liability Insurance Polices: What the Courts have Done With It, 1970 Ins. L.J. 519, 520.
Other courts adopting a general view of the insured’s activity view the relevant “activity” as “supervising children on a regular basis for compensation” and, predictably, conclude that the exclusion applies. Stanley v. American Fire & Cas. Co., 361 So. 2d 1030 (Ala. 1978); Moncivais v. Farm Bureau Mut. Ins. Co., 430 N.W.2d 438 (Iowa 1988); Haley v. Allstate Ins. Co., 129 N.H. 512, 529 A.2d 394 (1987). These decisions seem to recognize no meaningful distinction between the terms “business pursuit” and “activity.”
A number of cases which have addressed the exclusion and exception conclude the policy language is ambiguous and that the policy must therefore be construed to provide coverage. See Gulf Insurance Company v. Tilley, 280 F. Supp. 60; State Farm Fire & Casualty Co. v. Moore, 103 Ill. App. 3d at 255-57; Foster v. Allstate Ins. Co., 637 S.W.2d 655 (Ky. App. 1981); and Robinson v. Utica Mut. Ins. Co., 585 S.W.2d 593.
The apparent purpose of the exception is to maintain coverage for ordinary “nohbusiness” activities which would generally be covered under the policy, even though those activities may be performed in the course of a business pursuit. See Frazier, The Business Pursuits Exclusion Revisited, 1977 Ins. L.J. 88. The cases from other jurisdictions demonstrate the difficulty of accomplishing that apparent purpose, while still giving effect to the language of the exclusion and the exception.
The divergent results from other courts interpreting the same policy language in the context of babysitting and, particularly, child supervision could be viewed as some justification for concluding that Western Indemnity’s policy is ambiguous: the language of the exclusion and exception in this context “may be understood to reach two or more possible meanings.” Central Security Mut. Ins. Co. v. DePinto, 235 Kan. 331, 334, 681 P.2d 15 (1984). In fact, the Supreme Court has acknowledged the possible relevance of divergent opinions from foreign jurisdictions:
“The mere fact that there is such a contrariety of judicial opinion over what constitutes ‘piloting’ or ‘serving as a crew member’ of an airplane demonstrates, we think, the inherent ambiguity of these phrases. The parties here and the parties in all those other lawsuits have each been able to make tenable arguments for construing the same language in different ways, and the courts have done the same. We certainly can’t say that the language used by the insurer here ‘clearly reveals its stated purpose.’ ” Alliance Life Ins. Co. v. Ulysses Volunteer Firemans Relief Assn., 215 Kan. 937, 948, 529 P.2d 171 (1974).
The Kansas Supreme Court, however, has said that the policy language is not ambiguous. Heinson v. Porter, 244 Kan. at 672-73. Because Heinson concludes that the insurer is estopped to deny coverage, the discussion of policy language could be viewed as dicta in the sense of a statement unnecessary to the decision. Rodriguez v. Cascade Laundry Co., 185 Kan. 766, 770, 347 P.2d 455 (1959). Viewed another way, however, questions of policy language construction appear to have been raised by the facts of Heinson. See Rodriguez, 185 Kan. at 768-69. In addition to rejecting the ambiguity argument, Heinson refuses to apply the particular activity analysis of Indiana, Georgia, Illinois, and Oregon. In any event, the record in this case does not disclose the particular activity of Loretta Donnelly.
Heinson appears to adopt the general analysis reflected in Stanley, Haley, and Moncivais, although it does not mention any of those cases. To focus on the general activity as discussed in Heinson, Loretta Donnelly’s day care operation was a business endeavor. She was being paid to care for Cody Susnik — this was her business.
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Larson, J.:
Donna Bishop appeals her conviction of one count of transporting alcoholic liquor in an open container. K.S.A. 41-804.
On October 28, 1988, Kansas Alcohol and Beverage Control officer Virgil Weigel, while watching the Rustin Retail Liquor Store at 17th and Washburn in Topeka, Kansas, observed a vehicle containing a male driver and four female passengers drive up in front of the liquor store. Bishop was later identified as the passenger in the left rear seat.
The driver went into the liquor store and emerged with a package which Agent Weigel observed being passed from the front seat to the back seat. He could not tell who was passing or receiving the package.
Agent Weigel followed and stopped the vehicle. A backup agent observed liquor bottles in the vehicle. Two open bottles and two cups of liquid were seized. Weigel could not identify in which part of the car the containers were found, but he testified he thought the bottle being passed from front to back was one of the open containers.
Bishop testified she did not have possession of any alcoholic liquor in the car that night, nor did she know that open containers were being transported. An unopened pint of alcoholic liquor was purchased by the driver and passed to the passenger sitting next to Bishop in the rear seat. All parties testified this bottle remained unopened.
The passenger sitting in the middle of the back seat testified the unopened pint purchased by the driver was placed in her purse and not found by the agents. She was not aware there were open containers in the vehicle and did not smell alcohol.
One of the other female passengers testified that three of the containers that were seized were in the front seat and she did not know where the other container was located.
The trial court stated that under the circumstances Bishop should have been aware that alcoholic liquor in an open container was being transported. The court concluded proof of Bishop’s constructive possession of the open containers was sufficient to support a guilty finding. Bishop appeals.
The trial court erred in applying the doctrine of constructive
possession to find Bishop guilty of transporting alcoholic liquor
in an open container.
Bishop contends the State is required to show actual possession of an open container to support the conviction.
“In a criminal action, when the defendant challenges the sufficiency of the evidence to support a conviction, the standard of review on appeal is whether the evidence, viewed in the light most favorable to the prosecution, convinces the appellate court that a rational factfinder could have found the defendant guilty beyond a reasonable doubt. The appellate court considers only the evidence in favor of the verdict to determine whether the essential elements of a charge are sustained. [Citations omitted.]” State v. Walker, 244 Kan. 275, 280, 768 P.2d 290 (1989).
K.S.A. 41-804 in applicable part provides:
“(a) No person shall transport in any vehicle upon a highway or street any alcoholic liquor unless such liquor is:
“(1) In the original unopened package or container, the seal of which has not been broken and from which the original cap, cork or other means of closure has not been removed;
“(2) in the locked rear trunk or rear compartment, or any locked outside compartment which is not accessible to any person in the vehicle while it is in motion; or
“(3) in the exclusive possession of a passenger in a vehicle which is a recreational vehicle, as defined by K.S.A. 75-1212, or a bus, as defined by K. S.A. 8-1406, who is not in the driving compartment of such vehicle or who is in a portion of such vehicle from which the driver is not directly accessible.
“(b) Violation of this section is a misdemeanor punishable by a fine of not more than $200 or by imprisonment for not more than six months, or both.”
Although this case was tried to the court without a jury, the following elements enumerated in PIK Crim. 2d 70.03, Transporting Liquor in an Opened Container, must be proved:
“1. That the defendant transported a container of alcoholic liquor in a vehicle upon a highway or street;
“2. That the container had been opened;
“3. That the container was not in a locked outside compartment (or rear compartment) which was inaccessible to the defendant or any passenger while the vehicle was in motion;
“4. That the defendant knew or had reasonable cause to know he was transporting an opened container of alcoholic liquor.”
At issue in this case is whether the State proved that Bishop knew or had reasonable cause to know that she was transporting alcoholic liquor in an open container.
The requirement that a party convicted of transporting an open container of alcoholic liquor must know or have reasonable cause to know that open containers of alcoholic liquor were present and being transported results from the Kansas Supreme Court decision in City of Hutchinson v. Weems, 173 Kan. 452, 249 P.2d 633 (1952), which involved an early construction of 41-804.
Weems was found not guilty of transporting an open container of alcoholic liquor based upon his defense of no knowledge of the presence of an open container while driving a car normally utilized by his father and other persons. Our Supreme Court pointed out that in G.S. 1949, 41-715, the legislature saw fit to make lack of knowledge of a violation unavailable as a defense in providing: “No person shall knowingly or unknowingly sell, give away, . . . any alcoholic liquor to . . . any minor.” (Emphasis added.) There the elements of intent and knowledge on the part of the wrongdoer were removed entirely from the offense and our Supreme Court reasoned that if the legislature had seen fit to incorporate a similar provision in the transportation section it could have done so, or, if dissatisfied with the court’s construction of 41-804, could still do so. 173 Kan. at 459. K.S.A. 41-804 was amended in 1981, but no change in the prior law or the holding in City of Hutchinson v. Weems was made.
Although State v. Erbacher, 8 Kan. App. 2d 169, 651 P.2d 973 (1982), involved transportation of an open container of a cereal malt beverage in violation of K.S.A. 41-2719, that section’s wording is substantially identical to K.S.A. 41-804. The wording was first interpreted in Erbacher to apply to passengers as well as drivers. In construing the term “transport” our court held it to be a synonym for “ ‘carry’ or ‘convey’ ” 8 Kan. App. 2d at 171. The open container of 3.2 beer was located between Erbacher’s legs on the floor of the car and he was deemed properly convicted because there was no issue concerning his knowledge or possession of the open container of beer. 8 Kan. App. 2d at 172.
Kansas has not previously extended the doctrine of constructive possession to cases involving transportation of open containers. The doctrine has been applied in drug prosecutions and was described in State v. Woods, 214 Kan. 739, 744, 522 P.2d 967 (1974), overruled on other grounds Wilbanks v. State, 224 Kan. 66, 579 P.2d 132 (1978), as follows:
“Under a charge of simple possession of marijuana it is not necessary to prove ownership of the prohibited drug in the sense of title, but the prosecution is required to show some measure of control over some amount of the drug. Such control may be immediate and exclusive, jointly held with another or it may be constructive possession where the drug is kept by the accused in a place to which he has some measure of access and right of possession and control.”
In light of the illustrations contained in Weems, where unknowing and unintended transportation of open containers was not deemed to have been intended by the legislature to be a violation of the law, and the lack of any change in the law for almost 40 years, we decline to apply the doctrine of constructive possession to unknowing passengers who are accused of transporting an open container of alcoholic liquor.
Although the policy of the statute as stated in Weems of lessening the opportunities to drink while driving still prevails, under the facts of this case, the only evidence supporting Bishop’s guilty finding was her being in a car where other parties had open containers and a conviction based on this does not further the stated purpose of the statute.
In an Illinois case involving the doctrine of constructive possession as it applies to transporting alcohol, the court stated that proximity to the alcohol is not sufficient to establish possession. People v. Mills, 116 Ill. App. 2d 283, 252 N.E.2d 395 (1969). “To apply the doctrine of constructive possession as urged by the prosecution there must be a showing that the defendant had the immediate and exclusive control of the area where the items allegedly possessed were situated.” 116 Ill. App. 2d at 287. The Illinois statute is similar to K.S.A. 41-804 in that it forbids transporting, carrying, or having alcoholic liquor in any motor vehicle except in the original unopened package. Mills involved a defendant seated in the middle of the front seat between two other people with two open beer cans on the floor. The cans could have been in the possession of any one of the three individuals, although pleas of guilty by two men in the front seat did negate the possession charge against Mills. The appellate court held there was insufficient evidence to sustain her conviction. Parties other than Bishop appear to have been charged, but the record does not disclose who was charged or the results of such prosecutions.
In this case the only evidence of the location of the alcohol is from a passenger other than Bishop who testified that three of the containers were in the front seat. The ABC agent could not identify the location of any of the alcohol and was clearly in error in assuming an open bottle was passed to the rear seat of the car. There is no evidence establishing possession of any open container by Bishop. In fact, all of the evidence is to the contrary.
As a result of our conclusion that the doctrine of constructive possession is inapplicable to this charge we must direct the vacation of Bishop’s conviction.
Reversed and remanded with instructions to vacate Bishop’s conviction. | [
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Rulon, J.:
John R. Daly, defendant, appeals his bench conviction for possession of cocaine. K.S.A. 1989 Supp. 65-4127a.
Factual History
On September 7, 1988, Robert VanHoesen, a Douglas County Sheriffs detective, received a telephone call from Detective Jim Gillespie of the Los Angeles, California, Police Department. Detective Gillespie informed Detective VanHoesen that he uséd a narcotics “sniffer” dog as part of a routine investigative procedure to examine packages being shipped from the Los Angeles airport by Federal Express. Detective Gillespie told Detective VanHoesen that the dog had identified a package being shipped to a Lawrence, Kansas, address. Detective Gillespie believed this package was suspicious because the seams of the box were covered with duct tape. He then directed the dog to the package, and the dog indicated that it contained narcotics.
On September 8, 1988, Detective VanHoesen telephoned the Federal Express office in Lenexa, Kansas and arranged for a controlled delivery of the package. At 8:30 a.m., Sergeant Cross-field picked up the package at the Lawrence office of Federal Express and was provided with a Federal Express truck, uniform, and clipboard. Sergeant Crossfield took the package, which was addressed to John Daly, 837 Michigan, Building 9, Apartment 3, Lawrence, Kansas, to the Judicial and Law Enforcement Center in Lawrence.
Detective VanHoesen submitted an affidavit in support of a search warrant of the package, and a district judge issued the warrant at 9:37 a.m. Detective VanHoesen and Sergeant Cross-field opened the box and found it contained newspapers and a clear plastic bag containing a white, powdery substance. Sergeant Crossfield removed a small sample of the powder, and conducted a cocaine field test. The results of the test indicated that the substance was cocaine. The bag and package were then resealed.
Detective Mack Pryor, of the Lawrence Police Department, dressed in a Federal Express uniform and driving a Federal Express truck, proceeded with the package to the address to which the package was sent. He arrived at 837 Michigan at 10:30 a.m. and went to Building 9. The package was addressed to Apartment 3 in Building 9, but since the apartments were designated with the letters A through D instead of numbers, Detective Pryor went to Apartment C and rang the doorbell. After waiting five to ten minutes at Apartment C without any response, a man came out of Apartment A and asked Pryor if he was looking for Apartment A. Detective Pryor explained he was looking for Apartment 3 but had found the apartments to be designated by letters rather than numbers. The man in Apartment A then asked Pryor who he was looking for and Pryor responded “John Daly.” The man identified himself as John Daly, accepted the package from Detective Pryor, arid signed the Federal Express receipt form. Detective Pryor asked Daly if he was expecting a package from California, and Daly answered “yes.”
After he delivered the package, Detective Pryor returned to the Federal Express truck and radioed Detective VanHoesen at the Judicial and Law Enforcement Center and informed him the package had been delivered and the correct address was Apartment A not 3. At that time, Detective VanHoesen was waiting for information from Pryor to complete an affidavit for a search warrant to search for the delivered package in Apartment A. The warrant was issued at 10:45 a.m. and received by VanHoesen at 10:48 a.m. Detective VanHoesen then radioed Sergeant Cross-field, who was waiting in a car near the apartment, and informed him that the warrant had been signed. VanHoesen then proceeded to the apartment building with the search warrant.
Within a few minutes, but before Detective VanHoesen arrived with the warrant, Crossfield, Pryor, and two other officers proceeded to Apartment A, and Pryor knocked on the door. When Daly answered, Pryor identified himself as a police officer and handcuffed Daly. The officers entered the apartment and, after being informed another person was upstairs, that person was brought down to the front room by Crossfield. The officers then remained in the front room until Detective VanHoesen arrived with the search warrant, which Crossfield testified was at about 10:50 or 10:55 a.m. Pryor testified that approximately 10 to 15 minutes elapsed from the time of entry and VanHoesen’s arrival.
While in the front room, the officers observed drug paraphernalia and marijuana residue sitting in plain view. Officer Pryor testified that the package he had delivered was sitting between the coffee table and couch and some of the newspapers had been taken out. The officers did not look in the box until Detective VanHoesen arrived.
When Detective VanHoesen arrived with the search warrant, he discovered the plastic bag was not in the box and asked Daly for consent to search the apartment, which Daly denied. VanHoesen returned to the Judicial and Law Enforcement Center to request a third search warrant while the other officers remained at the apartment. VanHoesen’s affidavit for the third warrant stated that the plastic bag had been removed from the box and “moved to an unknown location in the apartment.” The affidavit further stated that the officers had observed, in plain view, pipes believed to be used for smoking hashish and marijuana, green vegetation believed to be marijuana, and a set of scales. The search warrant was issued at 1:39 p.m. and authorized a search for cocaine, marijuana, narcotics, paraphernalia, the plastic bag containing cocaine, items establishing identity of the person(s) in control of the apartment, and records of narcotics purchases and sales.
The third search warrant was executed shortly after its issuance, and the plastic bag containing cocaine was located under a blanket on a divan in the front room. The officers also seized various drug paraphernalia.
Daly was initially charged with possession of cocaine with intent to sell (K.S.A. 1989 Supp. 65-4127a); possession of marijuana (K.S.A. 1989 Supp. 65-4127b[a][3]); possession of drug paraphernalia (K.S.A. 65-4152[a][2]); and failure to pay tax imposed upon marijuana and controlled substances (K.S.A. 79-5201 et seq.). Following the preliminary hearing, Count I of the complaint was amended to charge only possession of cocaine, and the charge for failure to pay the controlled substance tax was dismissed by the trial court.
Daly filed two motions to suppress; one alleged the package was illegally seized in Los Angeles, the other claimed the officers’ warrantless entry into Daly’s apartment tainted the evidence seized under the third search warrant. Both motions were denied.
Following a bench trial, the trial court found Daly guilty of one count of possession of cocaine and not guilty of possession of marijuana and possession of drug paraphernalia. In ruling on the charges of possession of marijuana and drug paraphernalia, the trial court found the officers had illegally entered the apartment without a warrant and, thus, the marijuana and paraphernalia in plain view were unlawfully observed and excluded from evidence. The court explained that the affidavit for the third search warrant claimed these items were in plain view without stating that the officers viewed the items upon a warrantless entry. The court noted the affidavit did not mention the inevitable discovery rule but instead totally relied upon the illegal entry. Additionally, in finding the entry to be illegal, the court stated that there was conflicting testimony as to whether the search warrant was even signed by the judge prior to the officers’ entry.
Warrantless Entry
Daly asserts that the police officers’ warrantless entry of his apartment, which the trial court found to be illegal, tainted the third search warrant and the cocaine found pursuant to that warrant. He maintains the third search warrant is totally invalid because the affidavit supporting the warrant described marijuana and paraphernalia observed in plain view upon the officers’ unlawful entry. Daly argues that, because the affidavit for the third search warrant includes the fruits of an illegal entry, all evidence obtained in a search pursuant to that warrant must be suppressed.
The trial court found the officers’ entry of Daly’s apartment- to be unlawful because it was done without waiting for the arrival of a warrant. The State has not appealed this finding so our discussion continues under the assumption the officers’ warrant-less entry was unlawful.
The Fourth Amendment to the United States Constitution-and Section 15 of the Kansas Bill of Rights protect against unreasonable searches and seizures of persons and property. The exclusionary rule prohibits introduction into evidence of both materials directly obtained from an illegal search or seizure and evidence derived from the unlawful search or seizure. Nardone v. United States, 308 U.S. 338, 341, 84 L. Ed. 307, 60 S. Ct. 266 (1939). The fruit of the poisonous tree doctrine extends the exclusionary rule to bar evidence indirectly obtained from an unlawful search. State v. McBarron, 224 Kan. 710, 714, 585 P.2d 1041 (1978). However, the fruit of the poisonous tree doctrine is inapplicable where the police learn of evidence from an independent source, or where the connection between the unlawful conduct of the police and the discovery of the challenged evidence has become so attenuated as to dissipate the taint. McBarron, 224 Kan. at 714. Whether evidence is admissible under this doctrine is a fact question. State v. Mzhickteno, 8 Kan. App. 2d 389, 393, 658 P.2d 1052 (1983).
In Segura v. United States, 468 U.S. 796, 82 L. Ed. 2d 599, 104 S. Ct. 3380 (1984), the United States Supreme Court held that the police officers’ illegal entry of a private residence did not require suppression of evidence subsequently discovered at those premises when executing a valid search warrant obtained on the basis of information wholly unconnected with the initial entry. Further, in Murray v. United States, 487 U.S. 533, 101 L. Ed. 2d 472, 108 S. Ct. 2529 (1988), the Supreme Court held that the Fourth Amendment does not require suppression of evidence initially discovered during the police officers’ illegal entry of private premises if that evidence is also discovered during a later search pursuant to a valid warrant that is wholly independent of the initial illegal entry.
Here, we are convinced the existence of an independent source precludes the application of the fruit of the poisonous tree doctrine to exclude the cocaine. The police officers knew, as a result of executing the first search warrant, that the box delivered to Daly contained cocaine. This knowledge was gained prior to the officers’ illegal entry and from a source wholly independent from such entry. While the affidavit for the third search warrant included information concerning marijuana and drug paraphernalia in plain view upon the illegal entry, the information concerning the cocaine was gained from the officers’ execution of the two prior valid search warrants. Any taint caused by the illegal entry was dissipated by the independent and separate sources upon which the officers’ knowledge of the cocaine was based. Therefore, there is substantial competent evidence to support the trial court’s refusal to suppress the plastic bag containing cocaine as fruit of the poisonous tree. See State v. Mzhickteno, 8 Kan. App. 2d at 393.
Probable Cause for Third Search Warrant
Daly contends the affidavit for the third search warrant did not satisfy the requirements of probable cause. He maintains that the statement “the white powder believed to be Cocaine, had been removed and moved to an unknown location in the apartment,” was based on pure conjecture. Daly claims VanHoesen inferred the cocaine was still in the apartment and that inference does not constitute probable cause.
“If a trial court’s findings on a motion to suppress evidence are supported by substantial evidence they will not be disturbed on appeal.” State v. Lockett, 232 Kan. 317, 319, 654 P.2d 433 (1982).
A search warrant may not issue except upon a showing of probable cause. State v. Dunn, 233 Kan. 411, 414, 662 P.2d 1286 (1983). Sufficient factual information must be placed before the issuing magistrate to support an independent determination that probable cause exists. State v. Abu-Isba, 235 Kan. 851, 853, 685 P.2d 856 (1984). Probable cause refers to the quantum of evidence which would lead a prudent person to believe an offense has been committed. State v. Brown, 245 Kan. 604, 613, 783 P.2d 1278 (1989). It does not require the same type of specific evidence of an offense as would be needed to support a conviction. State v. Dunn, 233 Kan. at 415. Further, mere affirmations of belief or suspicions are not enough to provide a rational basis upon which a probable cause determination can be made. State v. Dunn, 233 Kan. at 414. Finally, the burden is on the prosecution to show a search and seizure was supported by probable cause. K.S.A. 22-3216(2).
Upon review of the record, we believe the trial court’s finding of probable cause and refusal to suppress evidence is supported by substantial competent evidence. As noted by the trial court, there is a certain amount of inference or conjecture in the affiant’s statement that the cocaine was in the apartment. However, the facts strongly support such a conclusion. The officers knew the package contained cocaine, the package was delivered to and accepted by Daly, and only a short period of time (approximately 15 minutes) elapsed between the delivery of the package and the execution of the second search warrant. While a possibility exists that Daly could have somehow destroyed the cocaine during the brief period he had the box in his apartment before the second search warrant was executed, the mere possibility of destruction does not negate the logical inference that the cocaine remained in the apartment after it was removed from the box. Under these circumstances, there was probable cause to issue the third search warrant for the purposes of searching the apartment for a plastic bag containing cocaine.
Illegal Seizure
Daly asserts that the package was illegally seized when Detective Gillespie selected the package based solely on the presence of duct tape and submitted it to a narcotics detection dog. He also complains the package was delivered to the Lawrence police without a warrant.
Letters and other sealed packages are in the general class of effects in which the public has a legitimate expectation of privacy. United States v. Jacobsen, 466 U.S. 109, 114, 80 L. Ed. 2d 85, 104 S. Ct. 1652 (1984). A search occurs when a reasonable expectation of privacy is infringed upon, while a seizure of property occurs when there is some meaningful interference with an individual’s possessory interests in that property. 466 U.S. at 113.
In United States v. Place, 462 U.S. 696, 77 L. Ed. 2d 110, 103 S. Ct. 2637 (1983), the United States Supreme Court held that subjecting luggage to a sniff test by a trained narcotics detection dog is not a search within the meaning of the Fourth Amendment. In Place, Drug Enforcement Administration agents, suspecting the defendant of drug smuggling, approached the defendant at La Guardia Airport and requested permission to search the defendant’s luggage, which the defendant refused. The agents seized the luggage and, approximately 90 minutes later, a narcotics detection dog reacted positively to one of two bags. 462 U.S. at 698-99. While the Court ruled that the Fourth Amendment did not prohibit such a detention, the Court held the police conduct exceeded the permissible limits of an investigative detention. 462 U.S. at 709-10. The Court found the 90-minute detention was a seizure requiring probable cause, which was absent. 462 U.S. at 709. The Court observed that detaining luggage from the immediate possession of a suspect intruded on the suspect’s possessory interest in his luggage as well as his liberty interest in proceeding with his travel itinerary. 462 U.S. at 708.
In Place, the Supreme Court extended the scope of a Terry stop (Terry v. Ohio, 392 U.S. 1, 20 L. Ed. 2d 889, 88 S. Ct. 1868 [1968],) to include luggage. The Court held that when an officer possesses a reasonable suspicion that a traveler is carrying luggage containing narcotics, the officer may briefly detain the luggage to investigate the circumstances. 462 U.S. at 706. As in a traditional Terry stop, a court must weigh the intrusiveness of a limited seizure on an individual’s Fourth Amendment rights against the governmental interests in such an intrusion to determine if a seizure based on less than probable cause can be supported. 462 U.S. at 703-05.
In holding that a canine sniff of a suitcase was not a Fourth Amendment search, the Court explained:
“A ‘canine sniff by a well-trained narcotics detection dog, however, does not require opening the luggage. It does not expose noncontraband items that otherwise would remain hidden from public view, as does, for example, an officer’s rummaging through the contents of the luggage. Thus, the manner in which information is obtained through this investigative technique is much less intrusive than a typical search. Moreover, the sniff discloses only the presence or absence of narcotics, a contraband item. Thus, despite the fact that the sniff tells the authorities something about the contents of the luggage, the information obtained is limited. This limited disclosure also ensures that the owner of the property is not subjected to the embarrassment and inconvenience entailed in less discriminate and more intrusive investigative methods.
“In these respects, the canine sniff is sui generis. We are aware of no other investigative procedure that is so limited both in the manner in which the information is obtained and in the content of the information revealed by the procedure. Therefore, we conclude that the particular course of investigation that the agents intended to pursue here — exposure of respondent’s luggage, which was located in a public place, to a trained canine— did not constitute a ‘search’ within the meaning of the Fourth Amendment.” 462 U.S. at 707.
“Place teaches that a seizure of luggage qua seizure, with no deleterious effects on the air traveler, is simply not a Fourth Amendment issue.” United States v. Puglisi, 723 F.2d 779, 787 (11th Cir. 1984). Therefore, when luggage is removed from a baggage cart for an immediate on-the-spot canine sniff, there is no impairment of the owner’s privacy interests or possessory in terests. 723 F.2d at 787-88. Privacy interests are not affected because, the sniff is not a search and possessory interests are not impaired because the owner has surrendered control of the luggage to a third-party common carrier. 723 F.2d at 788. Thus, the Fourth Amendment is not implicated and Place has no significance. 3 LaFave, Search and Seizure § 9.6(e) n.148 (2d ed. 1987).
In United States v. Germosen-Garcia, 712 F. Supp. 862 (D. Kan. 1989), a narcotics detection dog sniffed the luggage of suspected drug couriers after the airline carrying it arrived at Wichita Mid-Continent Airport but before the airline transported the baggage to the baggage claim area. The District Court held that the use of a drug detection dog constituted neither a search nor a seizure. 712 F. Supp. at 866. The court found that under Place, there was no search and no privacy expectations were violated. 712 F. Supp. at 866. Further, there was no seizure under the Fourth Amendment because the luggage was in the possession of a third-party common carrier, there was no significant delay in processing the luggage, and there was no disruption of travel plans. 712 F. Supp. at 866-67. Thus, the District Court concluded that a reasonable suspicion is not needed to subject a bag to a canine sniff when (1) the luggage is not taken from the immediate possession of the traveler, or from an area in which he has a legitimate privacy interest; and (2) the delay involved is brief and does not interfere with the traveler’s plan. 712 F. Supp. at 871.
The courts’ reasoning in Puglisi and Germosen-Garcia directly follows the principles set forth in Place. Place holds that a canine sniff is not a search under the Fourth Amendment. Further, it is well established the Fourth Amendment prohibition against unreasonable seizures protects an individual’s possessory interests- United States v. Jacobsen, 466 U.S. at 113. Clearly, possessory interests are minimal when control of an item has been surrendered to a third-party common carrier. Moreover, when there is no significant delay in delivery of a package or infringement on travel interests, it is difficult to find any infringement on possessory interests, particularly an infringement that implicates the Fourth Amendment. Thus, reasonable suspicion is not a constitutional prerequisite to a canine sniff under these circum stances. See United States v. Puglisi, 723 F.2d at 787-88; United States v. Germosen-Garcia, 712 F. Supp. at 871.
Applying these principles to the present case, there was no illegal seizure of the package addressed to John Daly. The package had been surrendered to Federal Express at the time the sniff test was conducted by the Los Angeles Police Department. At this point John Daly’s possessory interests in the package were minimal. Further, there was no indication that the package was delayed for a significant amount of time because of the canine sniff. Once the sniff was completed, the Lawrence police were alerted and the package continued in the normal course., of delivery until it reached Lawrence. The Lawrence Police Department had possession of the package for approximately one hour before the first search warrant was issued and executed. Again, this detention was brief, minimally intrusive upon Daly’s possessory interests, and was solely for the purpose of securing the package while obtaining a search warrant.
Under these circumstances, there was not a seizure of the package under the Fourth Amendment. Daly’s possessory interests were affected minimally, if at all. The detentions by the Los Angeles and Lawrence officers did not last for unreasonable lengths of time and the package was delivered within the time deadline established by Federal Express. Daly’s Fourth Amendment rights were not violated by the use of a narcotics detection dog and the officers’ actions subsequent to executing the first search warrant.
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Larson, J.:
Newell Barker appeals from the trial court’s ruling that the lesser interest clause in an oil and gas lease operates to reduce an overriding royalty interest.
In 1945, Mabel A. Loyd acquired title to all of the surface and mineral rights in and to the Northwest Quarter of Section Nineteen, Township Eight, Range Twenty-two, Graham County, Kansas.
On December 21, 1977, Ms. Loyd conveyed to a third party one-half of the mineral interest in the described property fully participating in the right to lease and to receive bonuses, delay rentals, and royalties.
Later, on the same day, Ms. Loyd conveyed the described real property to Ronald L. Quint and Sherry J. Quint, but reserved a one-half interest in the minerals for a term of ten years from April 17, 1973, and as long thereafter as oil and gas is produced. The reservation was non-participating in leasing rights, bonuses, and rentals, but folly participating in royalties. By this conveyance the Quints acquired the right to lease Ms. Loyd’s reserved interest plus the right to receive bonuses and rentals.
The Quints subsequently leased the described real property to Randy Marintzer, utilizing a producers form 88 1-43B oil and gas lease containing the following lesser interest clause:
“If said Lessor owns a less interest in the above-described land than the entire and undivided fee simple estate therein, then the royalties and rentals herein provided shall be paid the Lessor only in the proportion which his interest bears to the whole and undivided fee. However, such rental shall be increased at the next succeeding rental anniversary after any reversion occurs to cover the interest so acquired.”
In addition, the lease contained the following typewritten clause:
“Lessor reserves the right to pump all wells. Lessor reserves a Vis of Vs Override and an option to purchase a Vi6 working interest. Lessee shall be responsible to prevent salt water contamination, and development, exploration of fresh water should contamination occur.”
Production was obtained on the land in 1981. The division order title opinion showed the Quints owned a Vi6 of Vs overriding royalty for which they received payment.
When the Quints filed for bankruptcy in 1983, their .0546875 overriding royalty interest was sold by the trustee to Barker.
The new lease operators (Boyer and Ambrosier) requested title opinions in 1986. The title opinions concluded Barker was entitled to only an undivided one-half of Vie of Vs overriding royalty.
Barker sued Boyer and Ambrosier, claiming ownership of a foil Vi6 of Vs overriding royalty. The oil purchaser paid the disputed interest into court.
After both parties filed summary judgment motions, the foregoing stipulation of facts was entered, and the trial court ruled Barker owned only one-half of Vi6 of Vs overriding royalty interest. Barker appeals. We reverse and remand with instructions.
Does the lesser interest provision of this oil and gas lease apply to the overriding royalty interest reserved hy the lessors?
“Regardless of the construction of the written contract made by the trial court, on appeal a contract may be construed and its legal effect determined by the appellate court.” Patrons Mut. Ins. Assn v. Harmon, 240 Kan. 707, 713, 732 P.2d 741 (1987).
Recause of uncertainty as to the extent of the mineral interest owned, when an oil and gas lease is executed the typical printed lease form (like the one utilized herein) provides that the lessor purports to lease the entire mineral interest in the described land. The lessee then relies on the lesser interest clause, which is also often referred to as the proportionate reduction clause, to compute the lessor’s actual interest in the property for payment purposes. Pierce, Kansas Oil and Gas Handbook § 7.07 (1986).
“For example, lessor owns an undivided one-half interest in the leased land. His royalty would be reduced to reflect his proportionate ownership of the entire mineral interest — one-half. If the lease provides for a one-eighth royalty, the lessor will receive V2 x Vsth or a Vi6th share of production.” Pierce, § 9.47.
The specific wording of the lesser interest clause also applies to the bonus paid for the execution of a lease and the delay rentals paid thereunder. See, e.g., Brooks v. Mull, 147 Kan. 740, 748, 78 P.2d 879 (1938).
The normal share reserved by the lessor under an oil and gas lease is a one-eighth royalty interest. The share of the lessee, usually seven-eighths, is commonly called the working interest. An overriding royalty is normally a charge on the working interest and not a reduction in the lessor’s interest.
The Kansas Supreme Court in Campbell v. Nako Corporation, 195 Kan. 66, 70, 402 A. 2d 771 (1965), described an overriding royalty in the following manner:
“Typically, the term ‘overriding royalty’ is used to describe a royalty carved out of the working interest created by an oil and gas lease. Most frequently it is created subsequent to a lease by outright grant or by a reservation in the assignment of the operating rights. It is an interest in oil and gas produced at the surface, free of the expense of production and its outstanding characteristic is that its duration is limited by the duration of the lease under which it is created. (See 3 Summers, Oil and Gas, perm, ed., § 554.) In Kansas any covenants in the instrument creating it are not covenants running with the land (Nigh v. Haas, 139 Kan. 307, 31 P.2d 28), and such interest is not an interest in land but is personal property. (Connell v. Kanwa Oil, Inc., 161 Kan. 649, 170 P.2d 631).”
It is universally agreed that the lesser interest clause acts on the bonus, delay rentals, and the lessor's royalty payable under an- oil and gas lease. The issue herein, which is a matter of first impression in Kansas, is whether the lesser interest clause operates to reduce Barker’s overriding royalty interest.
Two of the leading authorities in commenting on the application of the "lesser interest clause to an overriding royalty interest reach conflicting conclusions. 4 Williams, Oil and Gas Law § 686.7 (1989) opines: “It is usually assumed that these clauses are applicable to all royalty interests of the lessor, however described, although there is some contrary authority.” The text in 3A Summers, The Law of Oil and Gas § 609.2 (1990 Supp.) reads: “The amount of an overriding royalty is determined by the language of the instrument creating it and not the lesser interest clause of the lease.”
The leading case on this issue is Williams v. Sohio Petroleum Co., 18 Ill. App. 2d 194, 151 N.E.2d 645 (1958). Lessors owned one-fourth of the mineral rights, and the lease had a lesser interest clause and the following typed provision: “ ‘In addition to the royalties provided for above, the Lessors hereby reserve an overriding royalty of V32nd of 7/8ths of all oil and gas produced and saved under and by virtue of this oil and gas lease. ’ ” 18 Ill. App. 2d at 196.
After recognizing that the lesser interest clause protects the lessee from double liability as to the royalty payments, Williams reasons:
“Nobody acquires such an overriding interest merely by virtue of ownership of mineral rights. It is acquired only by contract, and is payable in the amount and to the person designated by the contract, and no one else. No question of double liability to other owners can arise therefrom, hence, the reason for a lesser interest clause does not apply.” 18 111. App. 2d at 198.
Williams then summarizes the problem and several of the applicable cases in the following manner:
“[T]he extent of the overriding royalty may be, and often is, limited by the extent of the mineral interest of the owner. It depends upon the wording of the reservation. The majority of the decisions hold this wording controls, without reference to a lesser interest clause ....
“The reasoning is simply this: although the lease describes a certain tract of land, it cannot confer on the lessee any greater rights to the oil than the owner has. If the lessor owns only a fraction of the minerals, the lessee must deal with the other owners to acquire a right to work their interests; he obtains by the first lease only the limited right to take that owner’s fraction of the oil. The owner may demand an override as to all oil taken from the described land, or, he may limit the override to the oil rights included under the lease. In the latter case, it applies only to the fraction he owned. The following are illustrative cases:
“Pollock v. McAlester Fuel Co., 215 Ark. 842, 223 S.W.2d 813. The lessor owned all the land and one-half of the mineral rights. He made an oil lease describing the land, and reserving an overriding royalty to. Vi6th of 7/sths of all oil and gas produced ‘under the terms of this lease.’ The court held the override must be applied to only one-half the oil taken from the land, because that was all that could be produced under the ‘terms of the lease.’ . . .
“R. Lacy Inc. v. Jarrett (Tex. Civ. App.), 214 S.W.2d 692. A landowner owned only a fraction of the minerals thereunder. He made a lease reserving a fraction of the oil produced ‘from the land described in this lease.’ The court held this would not be limited to his fraction of mineral rights, but applied to all oil produced from the land.
“Hooks v. Neil (Tex. Civ. App.), 21 S.W.2d 532. This involved a deed rather than a lease. The owner of a one-half interest in land conveyed it reserving a fraction of oil produced on ‘the land and premises herein described and conveyed.’ Held: the reservation applied only to one-half since that was all the deed conveyed.”
“King v. First National Bank, 144 Tex. 583, 192 S.W.2d 260. This was also a deed by the owner of an undivided one-half interest in land. The reservation was of a fraction of oil produced from ‘the hereinabove described land.’ Held: The reservation would not be reduced to one-half of .oil produced, but applied to all oil produced from the described land, since that is what the deed said.
“McMahon v. Christmann, 303 S.W.2d 341. . . . [T]he court referred to the ‘lesser interest clause.’ It was held not to apply . ... A .. . concurring opinion pointed out there was no need to refer to the lesser interest provision, because the reserved override was a fraction of all oil produced from the described land, and would have to be given that effect for the simple reason that was what the reservation said.” 18 Ill. App. 2d at 198-200.
The result in Williams flowed naturally from the court’s reasoning. Since the overriding royalty was V32 of 7/s of all oil and gas produced and saved “under and by virtue of this oil and gas lease,” the reserved interest was applied “only to the V<ith interest involved, and not to all oil produced from the premises/ ” 18 Ill. App. 2d at 200.
The most recent Illinois decision, Downen Enterprises v. Gem Oil & Gas Co., 131 Ill. App. 3d 826, 828, 476 N.E.2d 42 (1985), reaches a different result but follows the reasoning of Williams.
“As stated in Williams, the extent of the overriding royalty interest reserved by [a lessor] depends on the wording of the reservation without reference to the lesser interest clause. . . . [Defendant's predecessor in interest accepted plaintiffs lease containing a reservation of a one-eighth of eight-eighths overriding royalty interest, a one-eighth of the total mineral interest and not a one-eighth of only plaintiffs interest in the minerals. . . . [Defendant is bound by the same reservation.”
In each of the Texas cases cited in Williams, the reservation of the overriding royalty was given effect in accordance to its terms. The same logic was well stated in Pollock v. McAlester Fuel Co., 215 Ark. 842, 847, 223 S.W.2d 813 (1949):
“Reservations, if made, may be worded as the parties please. If they provide that the grantor shall have a named fraction of the oil produced on all of the described land, that is one thing; if they provide that he shall have a fraction of what is produced from the interest conveyed by the particular lease, it is another thing. The courts will enforce either agreement as made.”
We hold the determinative factor is the wording of the overriding royalty reservation or grant and not the application of the lesser interest clause. We reverse the trial court in its application of the lesser interest clause to this overriding royalty reservation.
In our construction of the terms of this oil and gas lease we must also give consideration to the familiar rules of construction set forth in Jackson v. Farmer, 225 Kan. 732, 739, 594 P.2d 177 (1979):
“[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. [Citations omitted.]
In making the proper construction it is important to recognize that what is not said is as important as what is stated. There is no reference to language limiting the reservation to “oil and gas produced under the terms of this lease,” which would limit the override as the trial court has done. Neither is the reservation stated to apply to “all oil produced from the described land,” which would result in the reserved interest operating on total production.
The reservation in issue herein is not stated to be limited to the oil and gas produced under the terms of this lease nor expanded to all oil produced from the described land, but simply states: “LESSOR RESERVES A Vie of 7/s OVERRIDE.”
The trial court’s opinion stated that neither party contended the wording was ambiguous, although Barker contended in the trial court and on appeal that it is. We do not agree with Barker’s contention, although we reach the result he advocates. We hold the wording is not ambiguous and must be construed as it is plainly written — to reserve a Vie of 7/s overriding royalty interest— undiminished or unchanged by the royalty owned by the Quints (which was only a reversionary interest) or the extent of the minerals they held the right to lease (a one-half interest). Such a holding is consistent with the rules of construction of Jackson v. Farmer.
The Quints clearly intended to reserve a full Vi6 of 7/s overriding royalty interest. They were paid for .0546875 of the production with the consent of the first working interest owners of the lease.
Even if we deemed the reservation to be ambiguous, we would reach the same result because we are giving the wording a practical and equitable construction, and one in favor of the lessor and against the lessee, by holding that the lessor receives exactly what they reserved — a “Vie of 7/s override.”
We reach the same result by considering the express wording of the reservation consistent with the decisions from Illinois, Texas, and Arkansas.
Both parties have improperly cited and attempted to utilize a prior unreported Court of Appeals decision. Kansas Supreme Court Rule 7.04 clearly prohibits this:
“Since unpublished opinions are deemed to be without value as precedent and are not uniformly available to all parties, opinions so marked shall not be cited as precedent by any court or in any brief or other material presented to any court, except to support a claim of res judicata, collateral estoppel, or law of the case.” Rule 7.04 (1989 Kan. Ct. R. Annot. 34).
No consideration has been given to the unreported case cited by the parties.
We reject the doom and gloom predictions of ruination of the oil and gas industry which Boyer and Ambrosier claim will follow from the result we reach herein. Parties remain free to negotiate the terms of oil and gas leases. Lease hounds, title examiners, and Kansas courts will continue to establish the extent of overriding royalty interests from the wording agreed to by the parties.
The decision of the trial court is reversed. This matter is remanded with instructions to enter judgment quieting title in Barker to a full Vie of 7/a overriding royalty interest (.0546875 of total production) and ordering payment to Barker of the suspended funds held by the clerk of the district court. | [
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Burr, J.:
First National Bank of Medicine Lodge appeals a decision of the district court which found that K.S.A. 44-312 grants wage claims priority over prior perfected security interests.
The facts in this case are undisputed. The action began as a foreclosure action by the Bank against Family Medicine Clinic (FMC) on a promissory note secured by FMC’s accounts receivable, and involved a resolution of a priority dispute between two banks. The Bank obtained appointment of a receiver to collect FMC’s accounts receivable, and FMC’s employees intervened to establish their claims for wages, unpaid pension, and vacation benefits. The district court granted the employees’ motion to convert the receivership into a general one and held the em ployees had preferential claims for recovery of wages, pursuant to 44-312.
On appeal, the Bank contends the district court erred in finding 44-312 provided the employees preferential treatment of their wage claims because 44-312 is a preferential statute, not a lien statute, and cannot displace vested rights. The employees liken 44-312 to the mechanic’s lien statute and conclude a statutory lien can be preferred to a prior perfected security interest. The issue requires interpretation of a statute, which is a question of law subject to unlimited appellate review. See Bell v. Simon, 246 Kan. 473, 476, 790 P.2d 925 (1990).
K.S.A. 44-312 provides in pertinent part:
“[\V]henever a receiver shall be appointed of the estate of any corporation, . . . the wages due to all laborers or employees other than officers of such corporation, accruing within the six months immediately preceding such appointment of a receiver . . . , shall be preferred to every other debt or claim against such corporation.’’ (Emphasis added.)
Although the specific issue presented here has not yet been addressed in Kansas, the few cases addressing 44-312 support the Bank’s position. See Acme Foundry and Machine Co. v. Wampler, 124 Kan. 486, 487, 260 Pac. 972 (1927) (“[T]he statute is a preference statute only, and not a lien statute.”). And, in other jurisdictions, the courts have held the wage claims subordinate, finding a preferred debt cannot become superior to a debt secured by a lien unless the statutory language creating the preferred debt clearly indicates an intent to do so. See Schmidtman v. Atlantic Phosphate & Oil Corp., 230 F. 769 (2d Cir. 1916); T.H. Mastin & Co. v. Pickering Lumber Co., 2 F. Supp. 605 (N.D. Cal. 1933); Pryor v. Pryors, Printers, 56 Ariz. 572, 110 P.2d 229 (1941); Seymour v. Berg, 227 Ill. 411, 81 N.E. 339 (1907); McDaniel v. Osborn, 166 Ind. 1, 75 N.E. 647 (1905). This argument is persuasive.
Kansas provides a variety of statutory liens for labor and services in other contexts. For example, K.S.A. 58-218 provides liens for seeding, baling broomcom, and baling hay and expressly states the lien is “preferred to that of any prior security interest or encumbrance.” Also, in K.S.A. 58-203, creating a lien for threshing and husking, the legislature expressly gave superpriority to the lienholder.
A statutory lien can be given superpriority under the Uniform Commercial Code, too. K.S.A. 84-9-310 provides such priority to persons who in the ordinary course of business furnish services or materials with respect to goods subject to a prior perfected security interest, so long as the statutory lienholder is in possession of the goods. Statutory liens subject to this superpriority rule include liens for feed and care of livestock. K.S.A. 58-207.
Still other statutory liens are expressly subordinated to prior perfected security interests. These include the oil and gas mechanic’s lien, which is preferred only to encumbrances attaching subsequent to commencement of the work which forms the basis for the lien (K.S.A. 55-207), and the transporter’s lien, which is subordinate to valid and existing perfected security interests (K.S.A. 55-214).
In drafting 44-312, the legislature employed the phrase “shall be preferred to every other debt or claim,” rather than providing wage claimants a “lien upon the property preferred to all other liens or claims,” or other language of similar import. All of the foregoing leads to the inescapable conclusion that the legislature intended only to allow wage claimants a preference over other general creditors and did not intend to give them priority over prior perfected consensual security interests. It is fundamental that the intent of the legislature governs when that intent can be ascertained from the statute. When a statute is clear and unambiguous, the court is required to give effect to the intention of the legislature as expressed in the statute rather than determine for itself what the law should or should not be. Bell v. Simon, 246 Kan. at 476. The district court erred in granting the employees priority over the Bank’s prior perfected security interest in FMC’s accounts receivable.
Reversed. | [
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Lewis, J.:
This is an appeal by Wanda Pilcher from the orders of the district court directing verdicts in favor of the Board of County Commissioners of Wyandotte County (Board), on her causes of action against the Board for damages for breach of an implied employment contract, violation of her due process rights, and retaliatory discharge for alleged “whistle-blowing.” She also complains that the district court erred in instructing the jury on her claim for retaliatory discharge for filing a workers’ compensation claim.
Upon review, we affirm the directed verdicts on the claims for breach of implied contract and violation of due process rights. We reverse the district court on the claim for retaliatory discharge and, further, for errors in instructing the jury, on the claim for retaliatory discharge for filing a workers’ compensation claim.
Pilcher had been employed by Wyandotte County as a case manager in the county community corrections agency and had been so employed from July 17, 1981, until her alleged wrongful discharge on June 22, 1987. Pilcher’s claims against the Board arise out of at least three separate factual scenarios, none of which are necessarily related to the other.
For its part, the Board denies that it had any improper motives in discharging Pilcher, denies that she had an implied contract, and denies that she was discharged either for “whistle-blowing” or for filing a workers’ compensation claim. The Board simply points out that Pilcher missed too many days of work as a result of arm and ankle injuries she sustained when she fell outside the Wyandotte County courthouse. The Board says that, according to its policy, she missed too many consecutive days of work and was discharged for that reason alone.
We first turn to Pilcher’s claim that the Board breached an implied contract by discharging her and that she was denied due process in the termination procedure. These two claims are based upon certain oral understandings Pilcher had of what had to take place before someone could be fired from a job at community corrections. Although conceding that she had no written or oral contract with the Board as to terms or the length of her employment, Pilcher contends that it was her understanding that an employee, before being fired, must be given a minimum of three warnings and an opportunity to appear before an advisory board. Pilcher insists that this understanding amounted to an implied contract and that it was breached by the Board by the method in which her employment was terminated.
We first address the issue of implied contract of employment and, specifically, whether the trial court acted properly in directing a verdict for' the defendant on this issue.
The Kansas Supreme Court in Holley v. Allen Drilling Co., 241 Kan. 707, 710, 740 P.2d 1077 (1987), discussed the rules to be followed in cases where a motion for directed verdict is filed:
“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. Further, the same test is applicable to a motion for judgment notwithstanding the verdict. [Citation omitted.]”
In Sampson v. Hunt, 233 Kan. 572, 578, 665 P.2d 743 (1983), the Kansas Supreme Court held that the question before a trial court on a motion for a directed verdict is not
“whether there is literally no evidence supporting the party against whom the motion is directed, but whether there is evidence upon which the jury could properly find a verdict for that party. Even where facts are undisputed it is possible that conflicting inferences may be drawn from those facts, and where that is true, the issue must be submitted to the jury. [Citation omitted.] Where no evidence is presented on a particular issue, or the evidence presented is undisputed and it is such that the minds of reasonable persons may not draw differing inferences and arrive at opposing conclusions with reason and justice, the matter becomes a question of law for the court’s determination. [Citations omitted.]”
Pilcher was seeking to prove that she had an implied contract of employment which laid down certain steps that had to be taken before she could be discharged.
Kansas is an “employee-at-will” state in which the general rule is that, absent an express or implied contract between employer and employee, either party may terminate the employment relationship at any time they please with or without cause. In short, absent a contract, an employee may be discharged at any time and the employer need have no reason or cause for discharging the employee and, by the same token, the employee may quit his job at any time for any reason. See Johnson v. National Beef Packing Co., 220 Kan. 52, 54, 551 P.2d 779 (1976).
There are some exceptions to the general rule. For reasons of public policy, an employee-at-will may not be discharged for filing a workers’ compensation claim. Murphy v. City of Topeka, 6 Kan. App. 2d 488, 493, 630 P.2d 186 (1981). Neither may an employee-at-will be discharged under circumstances where that discharge is against any clear public policy. See Cain v. Kansas Corporation Commission, 9 Kan. App. 2d 100, 673 P.2d 451 (1983), rev. denied 235 Kan. 1041 (1984).
In the instant matter, we deal with a claim of implied contract. If Pilcher’s evidence was not sufficient to go to a jury on this issue, she was nothing more than an employee-at-will and her termination was proper unless one of the exceptions to the general rule applies.
The parties are well aware of the evidence offered on the issue of implied contract and we have generally capsulized that evidence earlier in this opinion.
The issue of whether an implied contract of employment exists is generally one for the trier of fact. However, in this case, the evidence offered by Pilcher was simply not sufficient to carry the issue to a jury. In general, she offered evidence by way of her own testimony and that of a former supervisor to the effect that all of the employees of the department of community corrections believed they would receive three warnings before being fired. Pilcher was unable to support this theory with any written documentations or policy and could not state from whom or where she received this information, simply insisting everyone said it had always been this way.
Without further elaboration and within the perimeters listed by the Kansas Supreme Court in the decisions set forth above, we hold that, on the issue of implied contract, the trial court did not err in directing a verdict for the Board. We also hold that the trial court did not err in directing a verdict on Pilcher’s claim that she was denied due process of law.
Pilcher’s claim that she was damaged by being terminated without due process of law is actually disposed of by our decision on her implied contract claim. The due process claim is essentially one which states that a party has been deprived of a “property right” without due process of law.
The problem with Pilcher’s due process claim is that, as an employee-at-will, she has no vested property interest in her job which is entitled to protection by the Fourteenth Amendment. No property interest in a job exists unless it is created by statute, ordinance, or implied or written contracts. Stoldt v. City of Toronto, 234 Kan. 957, Syl. ¶ 2, 678 P.2d 153 (1984). Since none of those elements or conditions were present in this case, Pilcher had no property interest on which to base her claim that her due process rights were violated by her discharge from employment with Wyandotte County and the trial court did not err in directing a verdict on this issue.
Pilcher’s third claim against the Board was that she was fired in retaliation for reporting illegal or unsavory practices by her employer.
As we pointed out earlier, there are activities which an employee-at-will may engage in for which the employee cannot be discharged. One of the activities for which an employee may not be fired is that activity commonly known as “whistle-blowing.” In essence, public policy dictates that an employee-at-will may not be discharged for reporting an unlawful or improper act of his or her employer. Relief for the tort of retaliatory discharge is available where the discharge contravenes a clear public policy. Cain v. Kansas Corporation Commission, 9 Kan. App. 2d 100, Syl. ¶ 6. A public employee cannot be discharged for exercising his or her right to free speech if it regards a matter of public concern. Riddle v. City of Ottawa, 12 Kan. App. 2d 714, 754 P.2d 465, rev. denied 243 Kan. 780 (1988).
If the evidence shows that Pilcher was discharged because the Board believed that she had reported unsavory and untenable hiring practices to the Kansas City Times, or “whistle-blowing,” then that is retaliatory discharge, and she is entitled to recover damages.
In order to maintain and prove that an employee was discharged for “whistle-blowing,” he or she must prove that:
“[A] reasonably prudent person would have concluded the employee’s coworker or employer was engaged in activities in violation of rules, regulations, or the law pertaining to public health, safety, and the general welfare; the employer had knowledge of the employee’s reporting of such violation prior to discharge of the employee; and the employee was discharged in retaliation for making the report.” Palmer v. Brown, 242 Kan. 893, 900, 752 P.2d 685 (1988).
During the trial, Pilcher maintained and presented evidence to the effect that she was fired because her superiors believed she was the source of an article in the Kansas City Times which was highly critical of certain hiring practices engaged in by the county. The article concerned the hiring of one Barbara Wallace as a presentence investigator in the community corrections department. The newspaper article indicated that, when a presentence investigator position opened up in the department, Wallace applied for the job but was at first turned down and advised that since she had no high school diploma and very little experience in the field, she was not qualified for the position. According to the article, Wallace then stated that they had promised her the job and she would get it. At the same time that Wallace applied for the job, there was another applicant for the position who had 20 years’ experience with legal aid and a degree in criminal justice and was obviously better qualified to fill the position than Wallace. Despite the disparity in qualifications of the two candidates, the newspaper article reported that one of the Wyandotte County Commissioners applied such great pressure in favor of Wallace that community corrections was eventually. left with no choice but to hire her rather than the other more qualified applicant.
As might be expected, Wallace was quite upset when the article was published, as were others in county government. According to evidence produced at the trial, Wallace told her superior that she had information to the effect that Pilcher was the source of the article.
The superior to whom Wallace reported her belief that Pilcher was the source of the article is the same individual who ultimately fired Pilcher. According to Pilcher, this individual was very upset because of the article and told her that he could fire her for talking to the newspaper. In fact, according to Pilcher, at the time he informed her she was fired, he stated that perhaps on her next job she would learn to keep her mouth shut.
The evidence indicates that during the trial' Pilcher denied, and she still denies, she was the source of the story and asserts she never talked to the newspaper concerning the hiring of Wallace. In this case, the discharge is made wrongful by proof that her employer was motivated to fire her because it believed that she was the source of the uncomplimentary newspaper article. Whether she was the source is not important; what is important is why she was discharged. If the trier of fact concludes she was discharged because her employer believed she- was the source of the newspaper article, that discharge is unlawful, and' she would be entitled to recover damages.
We believe and hold that Pilcher’s evidence showed' all of the elements required by Palmer v. Brown to carry her case to the jury on the theory of retaliatory discharge for whistle-blowing. We note that the Palmer decision discusses discharging an employee for reporting a violation of the law pertaining to public health, safety, and the general welfare. We do not believe that those areas are exclusive in proving a claim for retaliatory discharge. If the matters reported in the Kansas City Times were true, and there is evidence that they were, the county was engaging in very questionable hiring practices which ultimately would have a detrimental effect on the general welfare of the taxpayers of Wyandotte County. If we were to permit Pilcher to be discharged because the Board believed she was the source of the newspaper article, we would be cutting off a very important source of public information concerning the operation of local and state governments. Therefore, even though the action of the Board in hiring Wallace may not have been in violation of the law, it was certainly sufficiently harmful to the public interest to qualify it as the basis for a claim of retaliatory discharge for “whistle-blowing. ”
Our focus on this issue is not whether there was literally no evidence supporting Pilcher’s position, but whether there was evidence upon which the jury could properly find a verdict for Pilcher. We are convinced and we hold that there was evidence presented upon which the jury could properly have found a verdict in favor of Pilcher on the issue of retaliatory discharge for “whistle-blowing.” That being the case, the action of the district court in directing a verdict in favor of the defendant on this issue was in error, and the matter is remanded for a trial on the issue.
The final issue concerns the instruction to the jury on the issue of Pilcher’s claim that she was wrongfully discharged in retaliation for filing a workers’ compensation claim. The trial court deemed the evidence sufficient to go to jury on this issue.
The basis of Pilcher’s contention on this issue is that the trial court erred in not giving a clear definition to the jury on the various ways retaliatory discharge of an employee, who has filed or may file a workers’ compensation claim, can be proven. Despite her present claim of error, Pilcher did not object to the instructions at the time of trial.
In Kansas the law is clear that a jury’s verdict will not be reversed on the basis of improper instructions unless the party complaining of the instructions has made a timely objection, unless that instruction is clearly erroneous on its face. Douglas v. Lombardino, 236 Kan. 471, 483, 693 P.2d 1138 (1985).
In Trout v. Koss Constr. Co., 240 Kan. 86, 88-89, 727 P.2d 450 (1986), the Kansas Supreme Court laid down the following standard in reviewing jury instructions:
“It is the duty of the trial court to properly instruct the jury upon the theory of the case. 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. [Citation omitted.]”
In the instant matter, instructions three and five are the pertinent instructions:
“No. 3
“The plaintiff contends that she was discharged in retaliation for filing a claim under the Workers’ Compensation Act. You are instructed that the plaintiff has the burden of proving by clear and convincing evidence that she was discharged for filing a claim under the Workers’ Compensation Act.
“Defendant contends that plaintiff was an employee at will and could be terminated for any reason. Defendant further denies that plaintiffs injuries or Workers’ Compensation claim had anything to do with her firing.”
“No. 5
“An employee who sustains personal injuries in the course of his employment is entitled by law to receive Workers’ Compensation. The employer may not terminate the employment of an employee in order to retaliate against or to punish the employee who files a claim for Workers’ Compensation. The termination of employment of an employee in retaliation for filing a claim for Workers’ Compensation in the course of his employment is wrongful and unlawful. An employee who is so discharged is entitled to recover damages from the employer.”
Pilcher contends that the jury sent a request to the court asking that the court define the difference between workers’ compensation and a workers’ compensation claim. We note that the question allegedly asked by the jury is not in the record and neither is the court’s response to that question. For that reason, we are unable to consider that as evidence on this appeal. However, despite that fact, we are still of the opinion that the instruction given by the trial court was clearly erroneous and the jury verdict against Pilcher on this issue is reversed.
The instructions by the court did not go far enough in advising the jury as to the law of wrongful termination whére workers’ compensation is or may be involved. In Kansas it is not only wrongful to fire an employee because he or she has filed a workers’ compensation claim, it is equally wrongful to terminate an employee because of his or her absence due to a work-related injury. In Coleman v. Safeway Stores, Inc., 242 Kan. 804, 816, 752 P.2d 645 (1988), the Kansas Supreme Court held as follows:
“Allowing an employer to discharge an employee for being absent or failing to call in an anticipated absence as the result of a work-related injury would allow an employer to indirectly fire an employee for filing a workers’ compensation claim, a practice contrary to the public policy of this state as described in Murphy v. City of Topeka.”
Cf. Rowland v. Val-Agri, Inc., 13 Kan. App. 2d 149, 766 P.2d 819 (1988) (retaliatory discharge claim not available to disabled employee receiving workers’ compensation benefits who is incapable of performing job duties and for whom no other position can be found).
When examining the record in this case, there is evidence to the effect that Pilcher’s absence from work as a result of her work-related injuries was a factor in her termination. There was also testimony to the effect that Pilcher’s alleged failure to call in when she was absent was a breach of duty owed to her employer.
The jury instructions quoted earlier advised the jury that the employer may not terminate the employee in retaliation for the employee having filed a workers’ compensation claim.
The instructions by the court leave the impression at this point that firing would only be wrongful if Pilcher had filed a workers’ compensation claim and was fired for that reason. Those instructions give to the jury only “part of the story.” The jury should have been instructed on the “rest of the story” that, even though no claim had been filed, an employee may not be terminated for absences due to a work-related injury which might form the basis for a workers’ compensation claim in the future. A termination on that basis would be a retaliatory discharge based upon the possibility of a workers’ compensation claim being filed in the future for which retaliatory discharge Pilcher was entitled to damages.
We hold that the failure of the trial court to instruct the jury that a claim of retaliatory discharge may exist, even though no workers’ compensation claim has been filed, if the discharge is based on absences of an employee due to work-related injuries renders the instructions on this issue clearly erroneous. We reverse and remand for a new trial on this issue.
Affirmed in part, reversed in part, and remanded. | [
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Abbott, C.J.:
In 1986, Elisa Cosgrove’s (and her former husband’s) parental rights were severed as to L.C. and C.C. That decision was affirmed by this court on appeal in In re Lori C., unpublished opinion No. 60,346, filed July 8, 1988, rev. denied 243 Kan. 778.
In March 1989, Mrs. Cosgrove filed a petition for habeas corpus. She alleged that her children were being restrained in violation of their constitutional rights. She alleged several points of error, including that:
(1) She was denied her Sixth Amendment right to a jury trial;
(2) the Kansas Department of Social and Rehabilitation Services (SRS) manufactured evidence by psychological manipulation of her children;
(3) the civil severance trial was scheduled prior to her criminal trial, which put her in the position of either testifying at the civil trial and revealing her defenses to the criminal trial, or not testifying at the civil trial to preserve her defenses, all in violation of her Fifth Amendment rights;
(4) assistance provided by counsel was ineffective;
(5) the joint trial was error;
(6) Pro Tem Judge Owens should have been recused.
The court granted SRS’s motion to dismiss the petition for habeas corpus. The trial court based its decision on three different factors, each of which alone would justify dismissal. First, the court said that Mrs. Cosgrove, having had parental rights severed, was not the real party in interest and had no standing to petition for the writ. Second, the court said that she was barred by res judicata because the issues were raised, or could have been raised, at the original trial. Finally, the court held that habeas corpus may not be used to review a civil judgment and “Ineffective assistance of counsel in a civil action does not present a valid cause of action.”
Mrs. Cosgrove filed her notice of appeal on May 16, 1989.
On June 8, 1989, as part of the original severance of parental rights case, Mrs. Cosgrove filed a “Motion for Relief from Order Severing Parental Rights.” She argued that Judge Owens’ failure to recuse himself denied her a fair trial and due process. The court denied the motion on the basis that issues regarding Pro Tem Judge Owens were raised at trial and on appeal in the original case and were, therefore, res judicata. Mrs. Cosgrove timely appealed the trial court’s dismissal of her motion. The cases were consolidated on appeal.
1. Writ of Habeas Corpus
Mrs. Cosgrove argues that she has standing to bring a petition for a writ of habeas corpus action because other Kansas cases recognize that habeas corpus is an appropriate remedy in child custody cases. She cites Anderson v. Anderson, 214 Kan. 387, 520 P.2d 1239 (1974); Beebe v. Chavez, 226 Kan. 591, 602 P.2d 1279 (1979); and In re Adoption of Wilson, 227 Kan. 803, 610 P.2d 598 (1980), as examples of habeas corpus petitions in child custody cases. In Anderson and Beebe, however, the action was brought by a parent of the child, seeking the return of the child. (Wilson only mentions habeas in dicta.) In the present case, Mrs. Cosgrove is no longer the childrens legal mother. K.S.A. 38-1581 et seq. concerns “termination of parental rights.” The effect of termination of parental rights was explained in In re Wheeler, 3 Kan. App. 2d 701, 702, 601 P.2d 15, rev. denied 227 Kan. 927 (1979):
“Where there is a termination of parental rights under the juvenile code [citation omitted], the sum total of the rights of the parent or parents in and to the child as well as the rights of the child in and to the parent or parents, are completely terminated; there is a complete and final divestment of all legal rights, privileges, duties and obligations of the parent and child with respect to each other.”
K.S.A. 60-1501 sets forth when a petition for a writ of habeas corpus is proper:
“Subject to the provisions of K.S.A. 60-1507 any person in this state who is detained, confined, or restrained of liberty on any pretense whatsoever, and any parent, guardian, or next friend for the protection of infants . . . physically present in this state may prosecute a writ of habeas corpus in the supreme court, court of appeals or the district court of the county in which such restraint is taking place.”
This statute recognizes that a parent, or someone with rights in the child, may bring a habeas petition for the child when the child’s physical liberty, i.e., custody, is at issue, for the protection of the infant. This is how cases such as Anderson arose.
A similar situation was considered in Helsel v. Blair Cty. Children & Youth, 359 Pa. Super. 487, 519 A.2d 456 (1986), where a. child’s half brother filed a petition for a writ of habeas corpus relating to the custody of a child. Under Pennsylvania law, the half brother had no legal claim to the child. The court said:
“A writ of habeas corpus was an accepted means of ascertaining and enforcing the right to custody of a child. [Citations omitted.] However, the status of the petitioner and the timing of the petition are important factors in determining the propriety of this means of relief. ‘To invoke the aid of habeas corpus for the purpose of determining custody of an infant, the petitioners for the writ must show a prima facie legal right to such custody. ’ Commonwealth ex rel. Ebel et ux v. King et al., 162 Pa. Super. 533, 58 A. 2d 484 (1948).” 359 Pa. Super. at 493.
In the present case, Mrs. Cosgrove has no legal rights to her former children. That right to file a petition for protection of the child is now conferred on the children’s legal guardians or adoptive parents.
In this appeal, Mrs. Cosgrove appears to present a novel argument. She maintains that her own liberty has been restrained. She notes that in Santosky v. Kramer, 455 U.S. 745, 753, 71 L. Ed. 2d 599, 102 S. Ct. 1388 (1982), the Supreme Court recognized the “fundamental liberty interest of natural parents in the care, custody, and management of their child[ren].” Her argument appears to be that K.S.A. 60-1501 allows a petition for a writ of habeas corpus when any person’s “liberty is restrained” and that her own personal liberty interest is restrained. Therefore, she argues, she is not bringing the action for the protection of the child, but in her own right.
This stretches the concept of “liberty.” Most Kansas cases concerning liberty at least implicitly refer to physical liberty. For instance, the child custody cases already discussed concern a child who is forced to live with another parent — the child’s physical movement is restrained.
Mrs. Cosgrove makes a number of other arguments, based on older cases; however, we believe the Kansas cases cited for support are distinguishable in that they occurred before court unification and before the present legislation concerning the care of children.
We are of the opinion there are good policy reasons for not allowing a habeas corpus petition by a former parent whose parental rights have been severed. The goal in a termination of parental rights is to get the child in a healthy environment and, preferably, to find adoptive parents. If such petitions were allowed, adoptions would be impractical because the adoptive par- exits would be subject to a suit at any time. The need for finality in termination cases is overriding. Also, if the right of habeas is extended to an intangible interest such as parental rights, it would, by analogy, be extended to other “fundamental liberty interests,” the scope of which could be enormous.
The United States Supreme Court, in Lehman v. Lycoming County Childrens Services, 458 U.S. 502, 73 L. Ed. 2d 928, 102 S. Ct. 3231 (1982), considered whether a woman whose parental rights had been terminated could bring an action for a federal writ of habeas corpus. The petition was brought under 28 U.S.C. § 2254(a) (1982), which provides:
“The Supreme Court, a Justice thereof, a circuit judge, or a district court shall entertain an application for a writ of habeas corpus in behalf of a person in custody pursuant to the judgment of a State court only on the ground that he is in custody in violation of the Constitution or laws or treaties of the United States.”
The Court noted that, although the statute specifically refers to persons in “custody,” modern cases have extended it to significant restraints on liberty. 458 U.S. at 508-09. (The scope of § 2254[a], then, is essentially the same as the scope of K.S.A. 60-1501.)
The Court recognized the distinction between a habeas corpus petition filed for a child’s interest from one filed for the parents’ interests. “Ms. Lehman simply seeks to relitigate, through federal habeas, not any liberty interest of her sons, but the interest in her own parental rights.” 458 U.S. at 511. The Court, although recognizing a parent’s liberty interest, held that federal courts have traditionally refused jurisdiction over family matters. 458 U.S. at 512. The Court also emphasized the State’s strong interests in the finality of termination case:
“The State’s interest in finality is unusually strong in child-custody disputes. The grant of federal habeas would prolong uncertainty for children . . . possibly lessening their chances of adoption. It is undisputed that children require secure, stable, long-term, continuous relationships with their parents or foster parents. There is little that can be as detrimental to a child’s sound development as uncertainty over whether he is to remain in his current “home,” under the care of his parents or foster parents, especially when such uncertainty is prolonged. Extended uncertainty would be inevitable in many cases if federal courts had jurisdiction to relitigate state custody decisions.” 458 U.S. at 513-14.
Lehman shows that parents’ fundamental liberty interest in raising their own children is a limited interest. See Lassiter v. Department of Social Services, 452 U.S. 18, 68 L. Ed. 2d 640, 101 S. Ct. 2153, reh. denied 453 U.S. 927 (1981) (holding that the Fourteenth Amendment does not necessarily require appointment of counsel in every parental status termination case). Because the interest is limited, there is no constitutional reason to extend the right to bring a habeas petition to parents who have had their rights terminated. The right to file a petition for writ of habeas corpus in behalf of the child in an effort to challenge the validity of the severance proceeding is conferred on the child’s legal guardian or adoptive parents and that right is not available to the parent or parents whose parental rights have been severed. This does not leave persons who have had their parental rights terminated without a remedy. K.S.A. 60-260(b)(6) is available.
2. K.S.A. 60-260(b)(6) Motion
Mrs. Cosgrove filed a motion for" relief in the original case in which her parental rights were severed, pursuant to K.S.A. 60-260(b)(6). She argues a new trial is necessary because newly discovered evidence indicates that Pro Tem Judge Owens was prejudiced against her. She appeals the denial of this motion.
An appeal from an order denying a motion under K.S.A. 60-260(b) brings up for review only the order of denial itself and not the underlying judgment. Ellis v. Whittaker, 10 Kan. App. 2d 676, 677, 709 P.2d 991 (1985). The granting of relief under K.S.A. 60-260(b) rests within the sound discretion of the trial court, and, on appeal, this court’s scope of review is limited to determining whether the trial court’s decision constituted an abuse of discretion. 10 Kan. App. 2d at 677.
Mrs. Cosgrove raised the recusal issue in the severance case and, on appeal, the Court of Appeals expressly held that she did not show error.
The matter was fully litigated. The trial court in this case was under no obligation to furnish a second opportunity to relitigate the identical issue. Thus, the trial court did not err in dismissing the petition for habeas corpus and in denying the motion for relief under K.S.A. 60-260(b)(6).
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Anderson, D.J.;
This is an appeal by Everett L. Johnson, respondent-appellant, from the district court’s order that, because he is a tenured teacher at Wichita State University, he is not eligible to be a member of the State Board of Education.. ,
On April 8, 1989, Richard Peckham, the popularly elected board member for District No. 10 of the Kansas State Board of Education (Board), resigned. Everett L. Johnson was appointed to the vacancy created by Peckham’s resignation. Johnson is a tenured faculty member of Wichita State Úniversity and, as such, is an employee of the State of Kansas. He filed an oath of office on June 6, 1989, with the Kansas Secretary of' State. He has, since that time, been acting as the Board member for the 10th District.
On May 26, 1989, the attorney general issued his opinion that K.S.A. 25-1904 precludes Johnson from serving on. the Board because he is a state employee. The State of Kansas, through the attorney general, .filed a petition in quo warranto.m Shawnee County District Court, requesting that the court enter an order “ousting and removing” Johnson from ..his position on the .Board. District No. 10 then held another convention and elected, Gwendel A. Nelson as a Board member. The State amended its-petition in quo warranto, adding Nelson as a party, alleging his election was null and void, and requesting the court to find that a vacancy existed in the Board position in District No. 10. Johnson filed an answer challenging the constitutionality of K.S.A. 25-1904. Nelson has voluntarily resigned from the office and is not a party to this appeal.
Both Johnson and the State moved for summary judgment on the State’s petition in quo warranto. The trial court granted the State’s motion for summary judgment, finding K.S.A. 25-1904 constitutional. We agree.
K.S.A. 1989 Supp. 60-256(c) allows summary judgment when there is no genuine issue of fact and one party is entitled to judgment as a matter of law. In this case there is no dispute regarding the relevant facts. The parties are in agreement that this is a proper case for summary judgment.
Article 6, § 2(a) of the Constitution of the State of Kansas provides:
“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.”
Article 6, § 3(a) provides:
“There shall be ten members of the state board of education with overlapping terms as the legislature may prescribe. The legislature shall make provision for ten member districts, each comprised of four contiguous senatorial districts. The electors of each member district shall elect one person residing in the district as a member of the board. The legislature shall prescribe the manner in which vacancies occurring on the board shall be filled.”
K.S.A. 25-1904 provides: “No state, school district or community junior college officer or employee shall be a member of the state board of education.”
The State contends that K.S.A. 25-1904 prohibits Johnson, a state employee, from holding a position on the Board. Johnson argues that K.S.A. 25-1904 is unconstitutional because it creates additional requirements for membership on the Board. He argues that, since the Board is created by the Kansas Constitution, the legislature cannot enact statutes creating additional requirements for its members.
In determining the constitutionality of a statute, our Supreme Court has stated the following rules:
“This court adheres to the proposition that the constitutionality of a statute is presumed, that 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. 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.” ’ (Quoting State v. Huffman, 228 Kan. 186, Syl. ¶ 1, 612 P.2d 630 [1980]).” Federal Land Bank of Wichita v. Bott, 240 Kan. 624, 628-29, 732 P.2d 710 (1987).
Johnson relies on a 1926 case, Jansky v. Baldwin, 120 Kan. 332, 243 Pac. 302 (1926). In Jansky, the plaintiff was elected as county superintendent of public instruction in Republic County. The defendant, Baldwin, had run against Jansky in her bid for re-election and won. Jansky filed a petition in quo warranto, alleging Baldwin was not qualified because he had not taught for 18 months, which was a statutory requirement for the office. Baldwin responded that the statute was unconstitutional because the office was created by the Kansas Constitution and the statute increased the qualifications beyond those in the constitution. At that time, Article 6, § 1 of the constitution provided: “A superintendent of public instruction shall be elected in each county, whose term of office shall be two years and whose duties and compensation shall be prescribed by law.” Kan. Const, art. 6, § 1 (R. S. 1923). The Kansas Supreme Court found that the constitution was silent on the qualifications for the position and, thus, the legislature was free to set eligibility requirements. 120, Kan. at 334. It stated the following general rule in reaching its decision:
“This section of the constitution is silent as to requirements of eligibility. It is the rule that when the constitution of a state creates an office, and names the requirements of eligibility therefor, the legislature has no authority to make additional requirements, nor to provide that one may hold the office who does not have the constitutional requirements. When an office is created by an act of the legislature, that body has authority to name the terms of eligibility, and modify them at will. [Citations omitted.]” 120 Kan. at 333.
Baldwin also argued that the constitution provided general disqualifications for all officeholders and that they were the only disqualifications for any office unless the constitution was amended. 120 Kan. at 333. The court rejected this argument with the following analysis:
“Under our form of government all governmental power is inherent in the people. Some governmental powers are delegated to congress, or to the federal government, by our federal constitution; those not so delegated are retained by the people. Hence, congress has no legislative power not granted to it by the federal constitution. This is not true of a state constitution. Since the people have all governmental power, and exercise it through the legislative branch of the government, the legislature is free to act except as it is restricted by the state constitution, and except, of course, the grant of authority to the federal government by the federal constitution. Our constitution (art. 5, §§ 2, 5 and 6) has placed certain restrictions upon the right of suffrage and the right to hold office. So long as a legislative act does not infringe upon those restrictions, it cannot be said to be unconstitutional. [Citations omitted.] Suitable educational qualifications and previous experience of such officers as county superintendent of public instruction change with changed conditions of the people. The constitution, although it provided such office, did not deal with the subject of the specific fitness of the person who should be elected to such office, leaving that to the legislature to be fixed and modified as educational needs might require.” 120 Kan. at 334.
In Jansky, the constitutional provision at issue listed no qualifications for the office of county superintendent of public instruction. This was the basis for the Supreme Court’s decision that the legislature was free to create qualifications for the position.
We agree with appellant that the provision at issue here, Article 6, § 3, is not completely silent on requirements for membership on the Board, It provides that the electors shall elect one person “residing in the district.” However, we also note that it is not as specific as other sections setting constitutional qualifications for other offices. Article 2, § 4 provides that a member of the house or senate must be a qualified elector residing in his or her district. Article 2, § 5 provides that the member cannot be a federal employee. Still, other provisions in the Kansas Constitution specifically give the legislature power to enact qualifications. Article 1, § 1 states that other qualifications for governor, lieutenant governor, secretary of state, and attorney general shall be provided by law. Article 3, § 7 provides that Supreme Court justices and judges shall be 30 years old, licensed to practice law, and fulfill other qualifications as provided by law. However, the absence of a specific grant of power to the legislature in Article 6, § 3 does not preclude the legislature from enacting further legislation since it does not rely on the state constitution for power. See Jansky, 120 Kan. at 334.
The annotation at 34 A.L.R.2d 155 discusses the legislature’s power to specify qualifications for offices created by state constitutions. It states the general rule as follows:
“It is quite generally considered that where the constitution lays down specific eligibility requirements for a particular constitutional office, the constitutional specification in that regard is exclusive and the legislature (except where expressly authorized to do so) has no power to require additional or different qualifications for such constitutional office.” 34 A.L.R.2d at 171.
However, it also notes that the specific nature of the constitutional language should be considered. Several jurisdictions distinguish “affirmative” qualifications from constitutional specifications of a “negative or minimum character.” 34 A.L.R.2d at 173. Negative language, such as that no person under 35 shall be elected governor, is interpreted as not precluding the legislature from enacting further qualifications. This rationale is based on the theory that such language only sets forth minimum standards, while affirmative language, that all citizens over 35 shall be eligible for office, has been interpreted to prohibit the legislature from creating additional eligibility requirements. 34 A.L.R.2d at 166-67. Some jurisdictions, however, do not follow the “affirmative/negative” rationale. See State ex rel. Powers v. Welch, 198 Or. 670, 259 P.2d 112 (1953).
The language in Article 6, § 3, at issue here, is not that typically considered to be affirmative or negative. It merely provides that the district shall elect one person residing in that district. While no negative language is used, the requirement appears to be a minimum.
There are no cases on point in Kansas. However, our courts have continually stated the theory, relied on in Jansky and the annotation at 34 A.L.R.2d 155, that the legislature has the power to enact any law which is not precluded by the state or federal constitutions. See Leek v. Theis, 217 Kan. 784, 802, 539 P.2d 304 (1975); NEA-Fort Scott v. U.S.D. No. 234, 225 Kan. 607, 592 P.2d 463 (1979). Unlike the federal constitution, which grants power, the Kansas Constitution limits power. See Leek v. Theis, 217 Kan. at 800-02. Hence, “where the constitutionality of a state statute is involved, the question presented is not whether the act is expressly or impliedly authorized by the constitution, but whether it is expressly or impliedly prohibited by the constitution. [Citations omitted.]” 217 Kan. at 803.
Article 6, § 2(a) provides that the legislature shall provide for a State Board of Education. This provision would conflict with Article 6, § 3 if Johnson is correct in his contention that the residency requirement precludes the legislature from enacting further qualifications. However, we do not believe that Article 6, § 3 contains such an express prohibition. In Jansky, the court acknowledged that the conditions and qualifications of a certain office may change and the legislature should be able to enact statutes to meet those changing needs. 120 Kan. at 334. While Article 6, § 3 is not completely silent on qualifications for Board members, it appears to only set forth the minimum requirement that the candidate be a resident of the district. No other requirements are mentioned. This limited language, when read together with Article 6, § 2(a), is not explicit enough to preclude the legislature from enacting further qualifications.
Johnson raises two other theories supporting his allegation that K.S.A. 25-1904 violates the Kansas Constitution. First, he argues that, since Article 6, § 3 is self-executing as suggested in State, ex rel., v. Board of Education, 212 Kan. 482, 487, 511 P.2d 705 (1973), the board of education may carry out its constitutional power of supervision without ancillary legislation. However, in State, ex rel. v. Board of Education, the court found that Article 6, § 3 is self-executing only in part. Furthermore, the court stated that, even if a constitutional provision is self-executing, the legislature could enact legislation to assist in its operation as long as the legislation was in harmony with the constitutional provisions. 212 Kan. at 488.
Finally, Johnson argues that K.S.A. 25-1904 is in conflict with Article 2, § 18 and Article 15, § 1, which together provide that the legislature shall provide for election or appointment of all vacancies in office unless otherwise provided for im the consti tution. Since the constitution creates the State Board of Education, Johnson alleges the legislature cannot enact legislation to elect those members or fill vacancies. However, Article 6, § 3(a) specifically states that the legislature shall provide for the filling of vacancies on the Board. The constitution does not provide a method for electing the members. Since it is silent on this matter, the legislature is free to enact such procedures.
Johnson next argues that K.S.A. 25-1904 violates the First and Fourteenth Amendments of the United States Constitution. The First Amendment challenge is based on the argument that K.S.A. 25-1904 restricts one’s right to freedom of political expression and to pursue public office by disallowing him to run for the State Board of Education. The State argues that Johnson cannot challenge this statute on behalf of any state employee who may be affected, but may only challenge it on behalf of himself. Thus, if the statute is constitutional as applied to him, then it must stand, regardless of whether it is unconstitutional as applied to others. Johnson contends that, since the First Amendment is at issue, he does not have to show the statute is unconstitutional as applied to him.
“The general rule governing the standing of a party to challenge the constitutionality of legislation is that a litigant to whom a statute may constitutionally be applied will not be heard to challenge the statute on the ground that it may conceivably be applied unconstitutionally to others, in situations not before the court. Broadrick v. Oklahoma, 413 U.S. 601, 37 L. Ed. 2d 830, 93 S. Ct. 2908 (1973). In the area of the First Amendment, limited exceptions to this rule are recognized. Courts have permitted attacks on overly broad statutes with no requirement that the person making the attack demonstrate that his own conduct could not be regulated by a statute drawn with the requisite narrow specificity. Freedman v. Maryland, 380 U.S. 51, 13 L. Ed. 2d 649, 85 S. Ct. 734 (1965). A person is allowed to challenge a statute as overly broad based upon the assumption that the statute’s very existence may cause others not before the court to refrain from constitutionally protected speech or expression.” State v. Thompson, 237 Kan. 562, 563, 701 P.2d 694 (1985).
However, particularly where conduct as opposed to speech is being infringed, “the overbreadth of a statute must not only be real, but substantial as well, judged in relation to the statute’s plainly legitimate sweep.” Broadrick v. Oklahoma, 413 U.S. 601, 615, 37 L. Ed. 2d 830, 93 S. Ct. 2908 (1973). Overbreadth scrutiny is less rigid when the challenged statute restricts conduct protected by the First Amendment, but does so in a “neutral, noncensorial manner.” 413 U.S. at 614.
At issue in Broadrick was an Oklahoma statute which broadly restricted the political activities of the State’s classified civil servants. 413 U.S. at 602-03. Since the Oklahoma statute was not directed at “particular groups or viewpoints,” it was “subject to a less exacting overbreadth scrutiny.” 413 U.S. at 616.
On the same day as its decision in Broadrick, the United States Supreme Court issued its opinion in CSC v. Letter Carriers, 413 U.S. 548, 37 L. Ed. 2d 796, 93 S. Ct. 2880 (1973). In that case, the court upheld the constitutionality of the Hatch Act, which prohibits federal classified employees from engaging in a wide variety of political activity, including running for office. The court, in making its decision, acknowledged the important interest the government had in limiting its employees’ partisan political activities. 413 U.S. at 564. It also considered the fact that the legislation was not discriminatory, nor was it aimed at any particular group or viewpoint. 413 U.S. at 564.
Restrictions on the political activities of public employees by themselves do not violate the rights guaranteed by the First Amendment. Broadrick v. Oklahoma, 413 U.S. at 616-17. Like the Oklahoma statute at issue in Broadrick, K.S.A. 25-1904 is not a “censorial statute, directed at particular groups or viewpoints.” Instead, it “seeks to regulate political activity in an evenhanded and neutral manner.” 413 U.S. at 616. Thus, it does not violate the First Amendment.
Johnson also alleges K.S.A. 29-1504 violates the Equal Protection Clause. Johnson contends that the State must show a compelling interest for excluding one section of society from running for the State Hoard of Education. In support of this position, he cites several cases which we do not find applicable. Kramer v. Union School District, 395 U.S. 621, 23 L. Ed. 2d 583, 89 S. Ct. 1886 (1969), holds that the State must show a compelling interest before it can impose certain restrictions, other than age, residency, and citizenship, on a person’s eligibility to vote. Kramer does not address the issue of restrictions on the right to run for political office. In Stone v. City of Wichita Falls, 477 F. Supp. 581, 584 (N.D. Tex. 1979), the United States District Court in the Northern District of Texas stated that the right to run for office was an important, but not fundamental, right under the First Amendment. However, the court then stated that the State must prove statutory restrictions are “reasonably necessary to achieve one or more compelling public objectives.” 477 F. Supp. at 584-85. Johnson also cites two Rhode Island cases, which held that, while the State has a compelling interest in regulating the political activities of its employees, the statutes at issue were too broad because they included partisan and nonpartisan offices. Martin v. State Board of Elections, 381 A.2d 235 (R.I. 1977); Cummings v. Godin, 377 A.2d 1071 (R.I. 1977).
More on point is Clements v. Fashing, 457 U.S. 957, 963, 73 L. Ed. 2d 508, 102 S. Ct. 2836 (1982), which provides that candidacy to run for office is not a “fundamental right.” Thus, it “ ‘does not of itself compel close scrutiny.’ ” 457 U.S. at 963. If a fundamental right is not involved, it is not necessary to deviate from the traditional equal protection principles, which provide:
“[D]istinctions need only be drawn in such a manner as to bear some rational relationship to a legitimate state end. Classifications are set aside only if they are based solely on reasons totally unrelated to the pursuit of the State’s goals and only if no grounds can be conceived to justify them.” 457 U.S. at 963.
At issue in Clements were two provisions of the Texas Constitution. One, Article XVI, § 65, provided that certain public officials, not all, who declared their candidacy for another public office must resign. The other, Article III, § 19, provided that holders of certain offices were not eligible for the Texas Legislature until their present term of office expired. The court found that the waiting period created by § 19 was insignificant interference and “need only rest on a rational predicate in order to survive a challenge under the Equal Protection Clause.” 457 U.S. at 968. That rational predicate existed because § 19 furthered the State’s interest in upholding the integrity of the justices of the peace. Nor did § 19 violate the Equal Protection Clause because it restricted the justices only from running for the legislature, not any other offices. 457 U.S. at 971. The State could not be punished for limiting the positions on which it placed restrictions. 457 U.S. at 969. The Supreme Court found that § 65 was a less substantial interference than § 19. It was not invalid simply because it did not require all officeholders to resign before running for another office/ 457 U.S. at 970-71.
The rationale for the exclusion of State employees in the present case is based on the potential conflict of interest for a tenured professor serving on the State Board of Education. The Board and the Board of Regents, which oversees Wichita State University, Johnson’s employer, do not share duties. The Board supervises public education through the high school and community college level. The Board of Regents supervises higher education. However, a conflict could arise when the two are vying for the same budget monies. While Johnson, as an employee, could want Wichita State University tó receive greater funds, as a Board member he should be working for that association’s funding. The same conflict could arise with other unclassified employees. Johnson’s argument that K.S.A. 25-1904 violates the Equal Protection Clause because it prohibits membership of unclassified State employees on this Board, while no similar restriction is placed on other offices, is not persuasive. Clements clearly holds that the State does not have to place equal restrictions on all offices, even if the same rationale might apply.
The State does not have to show a compelling reason for the statute. It is adequate that the potential conflict of interest exists. K.S.A. 25-1904 does not violate the United States Constitution’s guarantees of free speech and equal protection.
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Rees, J.:
Respondent Teresa D. Criqui appeals from the order of the trial court denying her motion to restore to her custody of her four minor children.
Teresa and petitioner Roger Criqui were divorced in December 1982. By agreement of the parties, Teresa was to have custody of their two children. The trial court incorporated this agreement into the divorce decree by reference, thereby awarding custody to Teresa. At the time of the divorce, Teresa was pregnant with the couple’s third child, who was bom in February 1983. In August 1984, Teresa gave birth to a fourth child.
Four months after the divorce was granted, Roger filed a motion for change of custody alleging Teresa’s emotional and mental state had deteriorated and this required a change of custody from Teresa to Roger. About ten days later, Roger dismissed his motion, stating the parties had mutually agreed to settle the custody dispute without the intervention of the court.
On November 6, 1985, Teresa executed a document captioned “Parental Consent” granting full care, custody, and control of her four minor children to Carolyn G. and Brenda S. Criqui, sisters of Roger Criqui, “until the final signed documents arrive from the Court of Shawnee County, Topeka, Kansas.” In this document, Teresa stated she did this with full knowledge of the consequences and with .the realization it was in the best interests of the children. The document, which had been drafted by her attorney at that time, was acknowledged by a notary public. Apparently, Carolyn Criqui has had actual physical custody of the minor children since that time.
On December 19, 1985, the trial court entered an “Agreed Order Changing Custody” which had been prepared by Teresa’s attorney. The order stated that, due to financial problems, the ability of Teresa to raise the children, and other related problems, it was in the best interests of the children that custody be transferred to Carolyn and Brenda Criqui. The order then awarded custody of the minor children to Carolyn and Brenda. At the bottom of the order is a notarized “Verification” by Teresa in which she states the Agreed Order Changing Custody is true and correct and in the best interests of the minor children. Roger executed a similar “Verification,” which is attached to the order.
On February 13, 1989, Teresa filed a motion to restore to her custody of her minor children. After a hearing, the trial court denied her motion, finding that an abrupt change in the custody of the minor children at that time would be harmful to the children. In reaching its decision, the trial court found the “best interests of the child” test was to be applied as an exception to the “parental preference” doctrine.
Teresa contends the trial court erred in applying the best interests of the child test, in not applying the parental preference doctrine, and, therefore, in denying her motion to restore custody. She claims Sheppard v. Sheppard, 230 Kan. 146, 630 P.2d 1121 (1981), cert. denied 455 U.S. 919 (1982), is controlling and was misapplied by the trial court.
In Sheppard, 230 Kan. at 148, the Supreme Court noted the parental preference doctrine was succinctly stated in Christlieb v. Christlieb, 179 Kan. 408, 409, 295 P.2d 658 (1956), as follows:
“ ‘[A] parent who is able to care for his children and desires to do so, and who has not been found to be an unfit person to have their custody in an action or proceeding where that question is in issue, is entitled to the custody of his children as against grandparents or others who have no permanent or legal right to their custody, even though at the time the natural parent seeks their custody such grandparents or others are giving the children proper and suitable care and have acquired an attachment for them.’ ” (Emphasis added.)
This doctrine entitles a fit parent, who is willing and able to care for his or her child, to custody of the child as against others who have no permanent or legal right to custody. The parental preference doctrine does not apply to the instant case. Here, Carolyn Criqui was granted legal custody after the parents executed the Agreed Order Changing Custody and the trial court entered the order granting custody to Carolyn. Thus, Carolyn has had legal custody of the four minor children for the past four and one-half years. This fact makes the parental preference doctrine inapplicable.
The controlling issue in Sheppard was the questioned constitutionality of a statute which would have allowed a court to disregard the parental preference doctrine and award custody of a child to a nonparent, upon motion and under the circumstances described in the statute, notwithstanding the fact that a parent currently had legal custody of the child. The Sheppard decision is a narrow decision and does not control the instant case. Here, the mother did not have legal custody of the children. Nor was Carolyn, who already had legal and physical custody of the children, seeking to divest Teresa, the natural mother, of legal custody. On the contrary, Teresa sought to take away legal custody from Carolyn. Sheppard may not be read as broadly as Teresa suggests. To do so would require us to misapply the holding in Sheppard, 230 Kan. at 154:
“What we hold here is simply this: that a parent who is not found to be unfit, has a fundamental right, protected by the Due Process Clause of the United States Constitution, to the care, custody and control of his or her child, and that the right of such a parent to custody of the child cannot be taken away in favor of a third person absent a finding of unfitness on the part of the parent. We hold that K.S.A. 1980 Supp. 60-1610(b)(2), which destroys that fundamental right, is violative of the Due Process Clause and therefore unconstitutional.” (Emphasis added.)
Here, there was no action or effort to take away the right of a parent to the custody of a child. Parental custody previously had been given up by the voluntary action of Teresa and Roger: Legal custody reposed with Carolyn. Sheppard does not control this case. . ...
We therefore must determine the correct standard to be used by a trial court in deciding whether to take legal custody of a child from a nonparent and give it to a parent.who by prior agreement relinquished that custody to the nonparent and then obtained court action, pursuant to the agreement, awarding custody to the nonparent.
In Lewis v. Lewis, 217 Kan. 366, 368, 537 P.2d 204 (1975), it is stated that, as between parents, “[b]efore a custody order will be modified the movant has the burden of showing the child can be better cared for. if the requested change is. granted.” (Emphasis added.) ' ...
K.S.A. 1989 Supp. 60-1610(a)(3) requires a court, when making custody orders part of a divorce decree, to determine custody or residency of a child in accordance with the best interests of the child. That statute further provides, in part:
“(A) If the parties have a written agreement concerning the custody or residency of their minor child, it is presumed that the agreement is in, the best interests of the child. This presumption may be overcome and the court may make a different order if the court makes specific findings of fact stating why the agreement is not in the best interests of the child.”
As to agreements by parents to transfer custody of a child to a third person, apparently, without court involvement, 59 Am. Jur. 2d, Parent and .Child § 30, pp. 166-67, states:
“Since children cannot be bought and sold, and since the parent is subject to obligations which he cannot throw off by any act of his own, agreements by which the parents, or one of them, transfer custody of a child to a third person, with the provision or informal understanding that custody will not be reclaimed, are not generally considered legally binding con tracts .... This is especially true in the case of a parent who, having been compelled by poverty or unfavorable circumstances to surrender the custody of his child, wishes to reclaim the child when his circumstances ate improved. It seems, however, that the courts are free to enforce such agreements where to do so would be in the best interest of the child. Some courts hold that parents can, by fair agreement, relinquish custody of their child. And others take the view that such an agreement is effective at least to cast on the parent repudiating it the burden of showing that its enforcement would be contrary to the child’s best interest and welfare. The parent, accordingly, will not he permitted to regain custody unless he can show that such a change of custody will materially promote the child's welfare.” (Emphasis added.)
We have found no reported Kansas case and no Kansas statute directly on point. Other jurisdictions have considered this issue. Ex Parte McLendon, 455 So. 2d 863 (Ala. 1984), is persuasive. There, an agreement of the parties designated that the paternal grandparents were to have custody of the minor child. The agreement was incorporated into the divorce decree and custody was awarded to the paternal grandparents who already had been caring for the child. A couple of years later, the mother filed a motion to modify custody. The child had lived with the grandparents from the age of eleven months until the time of the hearing, some five years later. The mother’s visits to the child were infrequent.
The Alabama Supreme Court found that the mother had remarried and was able to provide a stable home for the child. However, the court refused to give custodial preference to the mother, stating: “A natural parent has a prima facie right to the custody of his or her child. However, the presumption does not apply after a voluntary forfeiture of custody or a prior decree removing custody from the natural parent and awarding it to a nonparent.” 455 So. 2d at 865. The court held that the superior right of the mother was cut off by the prior decree awarding custody to the grandparents. The court then stated:
“The correct standard in this case is: 'Where a parent has transferred to another [whether it be a non-parent or the other parent], the custody of h[er] infant child by fair agreement, which has been acted upon by such other person to the manifest interest and welfare of the child, the parent will not be permitted to reclaim the custody of the child unless [s]he can show that a change of the custody will materially promote h[er] child’s welfare. ’
“It is not enough that the parent show that she has remarried, reformed her lifestyle, and improved her financial position. [Citations omitted.] The parent seeking the custody change must show not only that she is fit, but also that the change of custody ‘materially promotes] the child’s best interest and welfare.” 455 So. 2d at 865-66.
In the instant case, the district judge said he was applying the best interests of the child test. A review of the record shows he was applying the same test established in McLendon, i.e., whether the parent has shown that a change of custody will materially promote the child’s welfare:
“THE COURT: Okay. As I indicated when we started, the best interest of the child at the time would be applied due to the exception that, as I say, I feel Kansas Courts would follow, which that being the case, . . . burden of proof would clearly be on [Teresa] to carry the burden to show that it would be in the best interest of the children to change.
“The court has before it the testimony of [Teresa and her present husband], which essentially are that they care about these four children, they would like to have an opportunity to have them in their home. I have the home study in front of me. I really don’t have anything before me that suggests that the children are not being well cared for and that the present circumstance is not going pretty well. Who might be the ultimate best parent is really not — I don’t have anything in front of me where I can decide that. But let me say how I do view this, based upon what I’ve heard today and the home study, . . . the fact is that we’ve had a change in custody three and a half or so years ago. At that time [A.C] would have been less than a year old or about a year old. [H.C.] would have been around two. [M.C.] would have been four and [S.C.] five — or six. . . . [M]y point is that these were pretty young children at the time. The home study report talks about [H.C.] and [A.C.] not wanting to have any visits with their mother. That’s not surprising. They don’t know their mother. She’s a stranger to them. ... I don’t blame the mother who feels that she’s got her life together and cares about her children for coming in here and asking for custody. But I think an abrupt change in custody at this point in time would be harmful to these children.”
On the basis of the evidence and the home study, the trial court found an abrupt change in custody would be harmful to the children. The court also found the mother’s testimony essentially was that she cared about the children and would like to have them in her home. The court heard no evidence the children were not being well cared for. Nor did the court have any evidence that would show who might ultimately be the better parent. Thus, Teresa failed to carry her burden to show that a change of custody would materially promote the welfare of her four children. The trial court did not err in denying Teresa’s motion to restore custody.
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Abbott, C.J.:
Gilbert Walbridge, Sr., appeals the trial court’s order requiring him to serve four months in the custody of the sheriff of Cloud County as a condition of his probation. Walbridge contends the trial court’s imposition of four months’ jail time as a condition of probation was illegal.
K.S.A. 1989 Supp. 21-4603(2) provides in relevant part:
“Whenever any person has been found guilty of a crime, the court may adjudge any of the following:
“(a) Commit the defendant to the custody of the secretary of corrections or, if confinement is for a term less than one year, to jail for the term provided by law;
“(b) impose the fine applicable to the offense;
“(c) release the defendant on probation subject to such conditions as the court may deem appropriate, including orders requiring full or partial restitution;
“(d) suspend the imposition of the sentence subject to such conditions as the court may deem appropriate, including orders requiring full or partial restitution;
“(e) assign the defendant to a community correctional services program subject to such conditions as the court may deem appropriate, including orders requiring full or partial restitution;
“(f) assign the defendant to a conservation camp for a period not to exceed 180 days;
“(g) assign the defendant to a house arrest program pursuant to K.S.A. 21-4603b; or
“(h) impose any appropriate combination of (a), (b), (c), (d), (e), (f) or (g).”
Walbridge argues that the trial court inappropriately combined (a) and (c) because probation and incarceration are mutually exclusive. He argues that, once the trial court decided incarceration was appropriate, its only option was to commit him to the Secretary of Corrections under (a). Further, Walbridge argues the definition of probation, under K.S.A. 21-4602, precludes imprisonment. That statute provides:
“ ‘Probation’ means a procedure under which a defendant, found guilty of a crime upon verdict or plea, is released by the court after imposition of sentence, without imprisonment, subject to conditions imposed by the court and subject to the supervision of the probation service of the court.”
Here, the trial court clearly indicated it was not imprisoning Walbridge on his sentence. Rather, as a condition of probation, the court was requiring him to serve jail time.
K.S.A. 21-4610 addresses the conditions the trial court may impose when probation is granted. That statute provides, in relevant part: “(1) Except as required by subsection (4), nothing in this section shall be construed to limit the authority of the court to impose or modify any general or specific conditions of probation.” Further, the statute provides: “(3) The court may impose any conditions of probation . . . that the court deems proper.”
Prior decisions have interpreted K.S.A. 21-4610 broadly. “The trial court has broad authority under 21-4610 to impose or modify any general or specific conditions of probation.” State v. Garrett, 14 Kan. App. 2d 8, 11, 780 P.2d 168 (1989). “The trial court has broad powers to impose probation conditions designed to serve the accused and the community. [Citation omitted.] Setting the conditions of probation lies within the sound discretion of the trial court.” State v. Mosburg, 13 Kan. App. 2d 257, 258, 768 P.2d 313 (1989).
In In re McClane, 129 Kan. 739, 284 Pac. 365 (1930), defendant was granted parole upon his own request. As a condition of that parole, McClane was required to serve six months in the county jail. On appeal, the Kansas Supreme Court did not have to reach the issue of the legality of that condition. The court implied, however, that such a condition would be within the sound discretion of the trial court when it said: “We do not wish to go so far in this case as to approve the confinement in jail as a condition and restriction of parole, although R.S. [1923,] 62-2202 gives wide latitude and discretion to the trial court in such matters.” McClane, 129 Kan. at 741.
In State v. Fowler, 238 Kan. 326, 710 P.2d 1268 (1985), the Supreme Court was faced with several questions concerning the trial court’s power to commit a defendant to the custody of a community corrections center and whether time spent in such centers should be awarded to a defendant as jail time credit. The court held: “If a trial court actually imposes a sentence of commitment and desires to place the defendant in a community corrections center, it may do so only by placing the defendant on probation and making confinement in the community corrections center a condition of his probation.” Fowler, 238 Kan. 326, Syl. ¶ 2.
Further, the court held: “K.S.A. 21-4614 does not authorize or require jail time credit to be awarded a defendant convicted of a felony during the period of time the defendant resides at a community corrections facility on order of the trial court as a condition of probation.” Fowler, 238 Kan. 326, Syl. ¶ 5.
In dicta, the court alluded to the legality of jail time as a condition of probation when it said: “There is no statute which provides that a defendant shall have credit for time spent in confinement as a condition of probation required by the trial court.” Fowler, 238 Kan. at 338. Fowler seems to have been modified by the legislature when it added section (2)(e) to K.S.A. 1989 Supp. 21-4603. That provision expressly allows the trial court to sentence a defendant directly to a community correctional services program. In addition, K.S.A. 1989 Supp. 21-4614a now requires credit for any time spent confined while on probation.
Walbridge’s reliance on State v. Martin, 14 Kan. App. 2d 138, 783 P.2d 1316 (1989), is misplaced. In Martin, the defendant argued that work release was an acceptable form of imprisonment and that, therefore, his required 90 days of imprisonment under K.S.A. 1988 Supp. 8-1567(f) (third DUI conviction in five years) was effectively served while he was on work release. This court concluded that the legislature intended for those individuals who were convicted of three or more DUI’s to be incarcerated. 14 Kan. App. 2d at 140.
Walbridge argues that, like Martins finding that imprisonment and work release are mutually exclusive, probation and incarceration are also mutually exclusive, and the trial court’s order requiring that he serve four months in jail as a condition of his probation cannot stand.
Walbridge fails to recognize three distinctions. First, K.S.A. 1988 Supp. 8-1567(f) is a specific statute requiring a specific result — that a third-time offender receive a specific sentence. K.S.A. 1989 Supp. 21-4603(2) is a general statute which gives the trial court broad discretion in its disposition. Second, McClane and Fowler implicitly support jail time as a condition of probation and the trial court’s discretion in the matters of disposition. And, third, K.S.A. 21-4610 allows the trial court to “impose any conditions of probation,” and further directs that “nothing in this section shall be construed to limit the authority of the court to impose or modify any general or specific conditions of probation.”
“[W]ords in common usage are to be given their natural and ordinary meaning in arriving at the proper construction of a statute.” Szoboszlay v. Glessner, 233 Kan. 475, 478, 664 P.2d 1327 (1983). The ordinary meaning of “nothing . . . shall . . . limit” and “may impose any conditions” in K.S.A. 21-4610 leads one inescapably to the conclusion that the trial court may, in its discretion, order jail time as a condition of probation.
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Gernon, J.:
Everett Glenn won a judgment against Aetna’s insured, Dale Fleming, in a personal injury action. Glenn filed a garnishment action against Aetna, alleging that Aetna had acted in bad faith during the settlement negotiations and seeking payment of the amount of the judgment in excess of the policy limits. The district court granted Aetna’s motion for summary judgment. Glenn, appeals this ruling, and also appeals the district court’s earlier denial of his motion for summary judgment. Aetna cross-appeals from one of the findings made by the district court in its ruling denying summary judgment to Glenn.
Glenn was severely injured as a result of a propane gas fire that occurred as he finished fueling Fleming’s vehicle. He sued five different defendants, and settled with four of the defendants prior to the pretrial conference. Fleming did not settle with Glenn, nor did he allege fault as to the other defendants. In his answer, he denied that any of the defendants were at fault.
At trial the jury found Glenn to be 30% at fault for the accident and Fleming to be 70% at fault. The total verdict was $1,500,000. The verdict reduced by 30% was $1,050,000. This case was appealed to the Kansas Supreme Court on the question of whether the fault of the defendants who had settled should have been compared. Glenn v. Fleming, 240 Kan. 724, 732 P.2d 750 (1987).
In May of 1986, Fleming signed a covenant not to execute agreement with Glenn. In this covenant, Fleming assigned all of his contractual rights with Aetna under the insurance policy to Glenn, and Glenn agreed not to execute upon or impose liens on any other property of Fleming, either real or personal, tangible or intangible, presently owned or after acquired.
In June of 1986, Glenn filed a praecipe for garnishment against Aetna. Aetna admitted to owing the $25,000 amount, its maximum coverage through its policy, but denied liability for any judgment in excess of that.
Glenn responded that Aetna was liable for the entire judgment because it had acted in bad faith in settlement negotiations. The dispute concerning the bad faith claim continued for some time with numerous motions and hearings. Voluminous pleadings were filed, expert witnesses were consulted, and more discovery took place,
To complicate the record further, Aetna was given permission to file a third-party petition against its own attorney. This petition alleged that its attorney had handled the defense of Fleming negligently and that he was liable for any judgment rendered against Aetna in the bad faith action by Glenn. This legal malpractice case was later bifurcated from the garnishment action.
Glenn first moved for summary judgment against Aetna. Aetna responded to this motion, but the court denied Glenn’s motion, finding that substantial triable issues of fact still existed. As part of its decision, the court ruled that Aetna’s attorney was acting on behalf of Aetna and that Aetna had the right to control and direct the litigation.
Aetna filed a summary judgment motion and statement of uncontroverted facts in March of 1988. Glenn filed a general response to this, stating that the number of uncontroverted facts was too great to respond to individually and that analyzing the statements and presenting documentation to controvert them would not be helpful to the court.
Aetna then countered with a motion for partial summary judgment and a statement of uncontroverted facts. Glenn responded and addressed the uncontroverted facts paragraph by paragraph.
A hearing was held on Aetna’s summary judgment motions and a motion of Aetna for clarification and reconsideration of the earlier decision denying Glenn’s summary judgment motion. A pretrial conference was also held during this hearing. At this conference Glenn agreed to drop all claims against Aetna except the bad faith claim.
The court ruled by sending a letter to counsel stating that it had reviewed everything and was granting Aetna’s first motion for summary judgment. The court adopted as its own all of the arguments and statements of uncontroverted facts put forth by Aetna pursuant to its motion. The attorney for Aetna was instructed to cause the matter to be journalized.
Glenn timely appealed the court’s decisions denying his motion for summary judgment and sustaining Aetna’s motion for summary judgment. Aetna filed a general cross-appeal.
The case was set for oral argument in August of 1989, but shortly before oral argument Aetna filed a motion for summary disposition of the case on the basis of a recently reported Kansas Supreme Court case, Heinson v. Porter, 244 Kan. 667, 772 P.2d 778 (1989). This court denied the motion for summary disposition but granted leave that it be renewed at oral argument.
The issues we are called upon to resolve are (1) should the case be decided summarily, (2) did the district court err in denying Glenn’s motion for summary judgment, (3) did the district court err in granting Aetna’s motion for summary judgment, (4) if Glenn prevails, for what amount of interest should Aetna be liable, and (5) did the district court err in ruling that Aetna could be vicariously liable for any negligence of its attorney?
Our resolution of this appeal makes it unnecessary to address issues (3) and (5) identified above.
(1) SHOULD THE CASE BE DECIDED SUMMARILY?
Aetna argues that this case should be summarily affirmed because it is controlled by the recent Kansas Supreme Court case of Heinson v. Porter, 244 Kan. 667.
In Heinson, Metropolitan Property and Liability Insurance Company had issued a $100,000 homeowner’s policy to Porter with the knowledge that she ran a children’s day care business in her home. The Heinson’s child was injured at the home and suit was filed against Porter. Metropolitan and Porter reached an agreement in a declaratory judgment action in which Porter stated that she had no coverage in regard to the Heinson allegations and no right of defense under the Metropolitan insurance policy. Heinson knew nothing about this settlement. Heinson and Porter settled the personal injury lawsuit for $500,000. One of the terms of the settlement was that Heinson would never seek collection of the judgment from Porter but would look to Metropolitan for payment. Heinson then filed a garnishment action against Metropolitan. The district court concluded that Metropolitan was liable for the $500,000, which generated an appeal to the Kansas Supreme Court. The Kansas Supreme Court first upheld the finding that the non-coverage agreement between Metropolitan and Porter was not binding upon Heinson because Heinson was a necessary party who should have been named in the declaratory judgment action.
The court also considered the $400,000 judgment, which was in excess of the policy limits. The district court had awarded the excess judgment because it found that Metropolitan had acted in bad faith and had breached its fiduciary duty to its insured. The Kansas Supreme Court noted that bad faith is a tort claim, and that tort claims are not assignable in Kansas. The court then discussed whether Heinson was entitled to recover the policy excess amount of $400,000 through the garnishment action. The court stated that, no matter how miserably an insurance company had treated its insured in handling a third party’s claim against the insured, the company’s liability is limited to the actual damage suffered by the insured. In this case, the court found that Porter, the insured, could never have any liability for the payment of the judgment because of the agreement between the plaintiff Heinson and Porter. Because Porter had no liability to pay the judgment, she had no actual damages, and therefore Metropolitan was not liable to pay the excess to Heinson. The court further stated that, even if there had been wrongful conduct on the part of Metropolitan, it still would not be responsible for the payment of the excess. 244 Kan. at 675-77.
Glenn asserts, for the purposes of this appeal, that the covenant not to execute is not a part of the record and cannot be considered. We reject Glenn’s assertion on this point. The covenant not to execute was filed during the district court proceedings and is included several times in the record on appeal.
We also reject Glenn’s claim that this 'matter was decided by the district court when it denied Aetna’s motion to dismiss the garnishment proceedings, and the assertion that Aetna cannot raise it at this time. The issue raised by Aetna in its motion for summary disposition was not addressed by the court decision referred to by Glenn. The court below ruled that Glenn was not impermissibly attempting to garnish his own property. The question raised here is whether the terms of the covenant relieved Fleming of any liability for payment of the judgment against him and, therefore, eliminated a requirement which was necessary in order for Aetna to be liable for excess payments.
Glenn would convince us that he is proceeding under the garnishment statutes and not on the basis of the covenant not to execute. This fact is not disputed by Aetna; however, it is also not helpful to Glenn when discussing the Heinson reasoning and results.
The essential facts in Heinson and the present case appear to be identical. In both cases there is a plaintiff with a judgment against an insured party in excess of the limits of the insurance policy. There is also a question of whether the insurance company acted in bad faith by not settling the plaintiffs case against the insured. In both cases the plaintiff has entered into a covenant releasing the insured from any liability for the judgment, and has further sought to collect the amount from the insurance company through garnishment.
A plain reading of the covenant not to execute refutes Glenn’s argument that Fleming continues to have full liability for the excess judgment and has suffered real damages. In the covenant, Glenn agrees not to execute upon or impose liens upon any property of Fleming, but to collect the judgment against Aetna by pursuing Fleming’s contract rights with Aetna under the insurance policy. This is the same type of agreement dealt with in Heinson. We conclude that Fleming has no actual damages because he is not liable for the payment of any judgment to Glenn. Under the holding of Heinson, Aetna would therefore not be liable for any payment of the excess judgment, regardless of whether it acted in bad faith during settlement negotiations or not. Under the Heinson reasoning, Glenn is able to try to collect the excess judgment by garnishment, but the existence of the non-liability covenant with the insured nullifies the basis for the garnishment.
We conclude that the Heinson ruling applies to this case and provides a basis for disposing of this appeal, and we therefore affirm the rulings of the trial court so far as this issue is concerned.
(2) DID THE DISTRICT COURT ERR IN DENYING GLENN’S MOTION FOR SUMMARY JUDGMENT?
After the judgment against Fleming had been rendered and the garnishment proceedings initiated, Aetna filed a third-party petition against its attorney, alleging that he had been negligent in handling the defense of Fleming in the lawsuit filed by Glenn.
Glenn then filed a motion for summary judgment in the garnishment action, arguing that Aetna had admitted to negligently defending the claim against Fleming because its attorney was the agent of Aetna and Aetna was therefore ultimately responsible for the negligent acts which it claimed its attorney had committed.
Aetna countered by stating that it was not vicariously liable for any negligence on the part of its attorney. It pointed out that in its claims against its attorney, it was stated that the pleading involved was hypothetical and did not constitute an admission. Aetna also contended that many genuine issues of material fact remained to be resolved, including questions of negligence, bad faith, causation, agency, and vicarious liability.
The district court denied Glenn’s motion for summary judgment, finding that there were material issues of fact remaining regarding the defense of Aetna. Glenn appeals this decision.
Summary judgment is appropriate when there is no genuine issue of material fact remaining and a party is entitled to judgment as a matter of law. K.S.A. 60-256(c). In considering a motion for summary judgment, 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. Bacon v. Mercy Hospital of Ft. Scott, 243 Kan. 303, 306-07, 756 P.2d 416 (1988).
We conclude that the district court did not err in refusing to grant summary judgment to Glenn. Glenn’s summary judgment motion relied solely on the fact that Aetna was suing its attorney for negligence. Aetna’s pleading against its attorney was phrased carefully so as not to admit to any negligence. In addition, Aetna’s response raised several other possible defenses to the garnishment action which were based on actions by Glenn and Fleming. We agree with the trial court that summary judgment would not have been proper with these issues unresolved.
(3) WHAT AMOUNT OF INTEREST SHOULD AETNA PAY?
Glenn stated, in his suggestion for the journal entry after summary judgment was granted in the garnishment proceedings, that judgment should be entered against Aetna “for the sum of $25,000 with interest at the legal rate from the date of the entry of judgment in this case until paid.”
The district court’s order states that judgment is entered against Aetna “for the sum of $25,000 with interest from the date of this judgment on the garnishment action at the legal rate until paid.”
Glenn maintains that Aetna should be liable for interest on the entire amount of the $1,050,000 judgment from the date when the judgment was entered. Glenn bases his argument on a provision in Aetna’s insurance policy and on the ruling by the Kansas Supreme Court in Stamps v. Consolidated Underwriters, 208 Kan. 630, 493 P.2d 246 (1972).
Some question exists as to whether Glenn’s letter to the court limits the interest request to the $25,000 policy limit amount.
We conclude that the letter presented a sufficient claim for interest based on the insurance contract.
Given this conclusion, the language of the insurance policy will determine whether interest on the excess part of the judgment must be paid. 208 Kan. 630, Syl. ¶ 1.
“If the language of a policy of insurance is clear and unambiguous, the words are to be taken and understood in their plain, ordinary and popular sense, and there is no need for judicial interpretation or the application of rules of liberal construction; the court’s function is to enforce the contract according to its terms.” American Media, Inc. v. Home Indemnity Co., 232 Kan. 737, Syl. ¶ 5, 658 P.2d 1015 (1983).
Aetna’s policy provides for payment of “all interest on the entire amount of any judgment therein which accrues after entry of the judgment and before the company has paid or tendered or deposited in court that part of the judgment which does not exceed the limit of the company’s liability thereon.”
The language plainly contemplates that the interest will be paid on the entire judgment, including the part of it in excess of the policy limits: Aetna does not dispute the language in its policy, but argues that it is not liable for interest on the entire judgment because it has repeatedly offered to pay its policy limits. Glenn contends that all of Aetna’s offers were conditional and were made to settle the entire claim. The record clearly supports Glenn’s contention on this issue.
The Kansas Supreme Court, in Stamps, stated:
“We are persuaded the language in the interest clause means what it says and means what a substantial segment of the insurance industry says it means, that is, irrespective of principal policy limits, the term judgment refers to the entire or whole judgment and not something less. This view is consonant with reason and justice and we hold the trial court properly ruled that appellant owes interest on the entire amount of the judgments rendered against Landwehr.” 208 Kan. at 635.
The theory supporting the conclusion reached in the Stamps case is based on several grounds. One is that the language of the policy creates liability for interest on the entire judgment. The insurer in this case, and in other cases, has drawn the policy without qualifications as to the term judgment. Also, under the terms of the policy, the insurer has complete control of any litigation from which it might incur liability. Thus, the insurer is responsible for settlement negotiations, any delays which might cause an accumulation of interest, and the final discharge of its obligations under the policy. Several courts have concluded that the insurer should therefore bear the expenses of any such delay. Underwood v. Buzby, 236 F.2d 937 (3d Cir. 1956); Wilkerson v. Maryland Cas. Co., 119 F. Supp. 383 (E.D. Va. 1953), aff'd 210 F.2d 245 (4th Cir. 1954); Highway Casualty Company v. Johnston, 104 So. 2d 734 (Fla. 1958); River Valley Cartage Co. v. Ins. Co., 17 Ill. 2d 242, 161 N.E.2d 101 (1959).
Aetna admitted that it owed the $25,000 but conditioned its payment on some other party giving up some right or agreeing to some other condition. This conduct is not consistent with the language of its own policy. At oral argument it was revealed that no money was paid into court until shortly before oral argument.
We conclude that the interest judgment ruling of the trial court should be reversed and, further, that Aetna be ordered to pay interest on the entire verdict rendered against Fleming from the date of that judgment until the date the policy limit was paid to the court.
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Lewis, J.:
This is an appeal by the defendant, Deborah K. Thatcher, from the entry of summary judgment in favor of plaintiff, Kansas Power & Light Co. (KP&L). Finding no error, we affirm..
At issue in this appeal is the proper measure of damages to be applied in this particular factual setting. The case was submitted to the district court on a stipulation of facts agreed to by the parties.
The stipulated facts show that in October 1986 an automobile driven by Thatcher struck and destroyed a wooden electric distribution pole owned by KP&L. Thatcher’s liability for damages, if any, is admitted.
The wooden pole damaged was a part of the electrical distribution system owned and operated by KP&L. The pole itself had been in place and used by KP&L for 35 years. KP&L claimed and was awarded damages for the loss of the pole in the amount of $525.14. Thatcher was given no credit or allowance for depreciation of the pole by KP&L.
For tax and accounting purposes, KP&L depreciated its distribution plant poles, towers and fixtures at an annual rate of 3.43 percent. KP&L has no systematic program of replacing poles after a set number of years. Poles are replaced only when that becomes necessary, regardless of age.
The case at issue involves defendant Thatcher, but it is one of four similar cases filed as separate counts in one petition before the trial court. All four defendants had similarly damaged power poles belonging to KP&L, and our decision in this case will be binding as to all four defendants.
The controlling issue on this appeal is whether KP&L can recover the cost of repairing and replacing its 35-year-old utility pole without regard to depreciation.
Thatcher also asserts the evidence does not support the trial court’s finding that the utility pole had no discernible life. We do not agree.
While the evidence could have been stronger, we hold the finding of the trial court is supported by substantial competent evidence. The evidence indicates that the average age of a utility pole is 35 years and that KP&L depreciates its poles at the rate of 3.43 percent per year. Thatcher insists the evidence shows the life of a pole is 35 years and not indeterminate.
Thatcher has misconstrued the evidence. There is no evidence relating to the actual life expectancy of the pole in question. It is true that the average pole has a life of 35 years, according .to the stipulated facts. However, by its very definition, the term “average” implies that some poles last less than 35 years, some longer. This does not, in any sense, fix the actual life expectancy of an individual utility pole. The average life span of a male in our society is approximately 72 years. This is an example of the use of average age. It obviously does not imply that all males cease to exist upon attaining the average age. We all know people much older than 72, as well as those who never attain that age. The average age of a male tells us no more about how long John Doe will actually live than the average age of a utility pole tells us how long an individual pole will remain in service.
In the absence of any definite evidence as to the actual life span of an individual utility pole, the trial court was free to find that the age of a utility pole is, in fact, indeterminate. In reaching this conclusion, it was not speculating, but based its finding on the evidence and inferences therefrom. We have no difficulty in holding its finding in this regard was supported by the evidence.
If it is impossible to determine the exact life span of a particular utility pole, the concept of using an artificial factor such as depreciation is unreliable as a basis for calculating damages. The pole in question in this case was 35 years old and had been completely depreciated; however, it was still in use, with no plan to replace it, at the time it was hit by Thatchers automobile. We have no idea how long this particular pole may have remained in use. We can assume, perhaps, that it had many more years of actual useful life to KP&L. If it did, KP&L was forced to make an unscheduled expenditure due to the negligence of Thatcher. It seems reasonable to assess Thatcher with the cost of that expenditure without reduction by an artificial factor such as depreciation. This, we believe, will achieve the most just and equitable result.
We deal here with a variety of possible factual scenarios. In the instant matter, the pole had been in use for 35 years and may have had many more years of useful life. Let us assume, for the sake of argument, that the pole destroyed was only two years old; the damage to KP&L is the same. It must replace and reinstall the pole regardless of its age. Keeping in mind the impossibility of determining how long any individual pole will remain in service, the fairer method of determining damages is to discard altogether the concept of depreciation.
In attempting to determine the proper measure of damages, we must keep in mind that the item damaged in this case was a wooden utility pole. An attempt to apply the usual rule relating to damage to or destruction of personal property to the facts in this case proves to be impossible. The general rule of damages in cases involving personal property is set out in Ultimate Chem. Co. v. Surface Transp. Int’l, Inc., 232 Kan. 727, 729, 658 P.2d 1008 (1983):
“The rule of damages generally followed in this state is that when personal property cannot economically be restored to its former condition, the measure of damages is the difference between its fair and reasonable market value immediately before and immediately after the damage. See PIK Civ. 2d 9.11 (1977); Foster v. Hamburg, 180 Kan. 64, 299 P.2d 46 (1956); Lester v. Doyle, 165 Kan. 354, 356, 194 P.2d 917 (1948).”
The item damaged in this case is a 35-year-old wooden utility pole designed to be used as part of an electrical distribution system. The record does not show that the wooden utility pole had any market value before or after it was damaged. As a result, the usual rule of damages in cases involving personal property simply cannot be employed because the item damaged in this case has no market value.
The Kansas Supreme Court, in a very early case, Hollinger v. Railway Co., 94 Kan. 316, Syl. ¶ 4, 146 Pac. 1034 (1915), which dealt with an item which had no market value,, held as follows:
“The case is the common one in which the property destroyed was not bought and sold on the market, had no market value, and consequently could not be valued by that standard. In such cases the real value is to be ascertained from such data as may be available. Cost is an element of such value, and a person having knowledge of the elements involved may testify to them and give his estimate of value.”
In a much later decision, Airight Sales, Inc. v. Graves Truck Lines, Inc., 207 Kan. 753, 756, 486 P.2d 835 (1971),’ our Supreme Court stated:
We do not deem a treatise on the law of damages necessary to the disposition of this case. An extensive annotation on the measure of damages for conversion or loss of, or damage to, personal property having no market value appears at 12 A.L.R.2d 902. See also, 25 C.J.S.-, Damages, §§ 88-90; 22 Am. Jur. 2d, Damages, §§ 148-151. Factors considered as relevant to damages where no ‘market’ obtains include cost of repair, original cost, ‘intrinsic’ value, loss of use, any special value to the owner, the loss of expected profits, and the cost of replacement.”
While the Kansas decisions give the courts a great deal of latitude in arriving at the proper measure of damages depending on the facts present, it appears that all of the various approaches at computing damages have the same ultimate goal: to make the damaged party whole. In N.J. Power & Light Co. v. Mabee, 41 N.J. 439, 441, 197 A.2d 194 (1964), the court stated: “[T]he sundry rules for measuring damages are subordinate to the ultimate aim of making good the injury done or loss suffered and hence ‘The answer rests in good sense rather than in a mechanical application of a single formula.’ ”
In the instant matter, neither party appears to argue seriously that the utility pole in question had a market value. It also appears that both parties agree that, to an extent, a proper measure of damages is the replacement cost of the pole and the cost of labor and overhead in installing the replacement pole as part of the distribution system. It is at this juncture that the arguments of both parties go opposite directions.
Thatcher argues that the pole in question was 35 years old, the average age of the plaintiffs wooden utility poles, and that plaintiff had depreciated the cost of the pole for accounting and tax purposes at the rate of 3.43 percent per year. Thus, Thatcher asserts that KP&L has already recovered the cost of the damaged pole through depreciation. She argues that KP&L will receive a windfall if it is allowed to recover the cost of a new pole with no offset for depreciation. Counsel for Thatcher asserts that since the pole in question was 100 percent depreciated, KP&L sustained no monetary loss when Thatcher’s car struck it down. Thatcher approaches the problem as though the pole became worthless upon reaching the age of 35.
KP&L argues that the pole in question is but one small part of its distribution system and that if the pole is destroyed it must be replaced immediately to keep the system in operation. KP&L admits that it depreciated the pole at the rate of 3.43 percent per year for accounting and tax purposes and that the average life of such a pole is 35 years. However, KP&L points out that it does not automatically replace each pole after it attains the age of 35 years, but only does so when the pole wears out and it becomes necessary to make a replacement. KP&L argues that the pole is analogous to a door handle on an automobile. If the handle is damaged, the proper measure of damages is the replacement of that door handle and depreciation is not a factor. Arguing by analogy, KP&L insists that the pole is no more significant in the overall makeup of its distribution system than a door handle is in the overall makeup of a car. Therefore, KP&L argues that it should be allowed to recover the entire cost of repair and replacement of the damaged pole unreduced by any artificial factors such as depreciation.
We must decide, then, whether KP&L’s recovery for repairing or replacing one of its utility poles damaged by the negligence of a tortfeasor must be offset or reduced by depreciation.
In resolving this issue, we have attempted to apply the reasoning set forth in N.J. Power & Light Co. v. Mabee and to use “good sense” in selecting a measure of damages that will most effectively “make good the injury done.”
In analyzing the problem, it should be clearly noted that it was the defendant who, without fault on the part of KP&L, negligently and without justification ran into and destroyed an intricate part of KP&L’s electrical distribution system. As a result, KP&L was forced to. immediately replace the damaged pole in order to put its system back in operation. We are unable to conclude that KP&L’s system w;as any more valuable with the new pole than it was with the 35-year-old pole.
As we interpret the facts stipulated to the trial court, the pole replaced was not scheduled for immediate replacement and would not have been replaced unless and until necessity made replacement an immediate requirement.' Under those facts, to what extent does the age of the pole figure into the question of damages? On its books, for accounting purposes, KP&L had recovered the cost of the pole through' depreciation; what effect does that fact have on the damages suffered?
There are two distinct lines of authority in this country regarding the amount that may be recovered for an item that has been depreciated; totally at odds with one another. The majority view holds that plaintiff may recover the cost of the replacement pole without reduction by depreciation. The minority view holds the opposite to the effect that, while plaintiff may recover the cost of repairing or replacing its pole, it must reduce that cost by depreciation.
The states represented by the following decisions have adopted the majority rule: (1) California-Pacific Gas & Electric Co. v. Alexander, 90 Cal. App. 3d 253, 153 Cal. Rptr. 319 (1979) (decision dictated by statutory construction); (2) Connecticut-Hartford Electric Light Co. v. Beard, 3 Conn. Cir. Ct. 323, 213 A. 2d 536 (1965); (3) Georgia-Horton v. Ga. Power Co., 149 Ga. App. 328, 254 S.E.2d 479 (1979); (4) Louisiana-Louisiana Power & Light Co. v. Smith, 343 So. 2d 367 (La. App. 1977); (5) Mississippi-Mississippi Power & Light Company v. Tillman, 291 So. 2d 736 (Miss. 1974); (6) Missouri-Board of Public Utilities v. Fenton, 669 S.W.2d 612 (Mo. App. 1984); (7) New Jersey-N.J. Power & Light Co. v. Mabee, 41 N.J. 439; (8) North Carolina— Light Co. v. Paul, 261 N.C. 710, 136 S.E.2d 103 (1964); (9) Oklahoma-Polk v. Oklahoma Gas & Electric Company, 410 P.2d 547 (Okla. 1966); (10) Tennessee-Middle Tenn. Elect. Corp. v. Barrett, 56 Tenn. App. 660, 410 S.W.2d 914 (1966); (11) Washington-Water Power v. Miller, 52 Wash. App. 565, 762 P.2d 16 (1988); and (12) West Virginia-Appalachian Power Co. v. Morrison, 152 W. Va. 638, 165 S.E.2d 809 (1969).
The minority view is represented by the following decisions from these states: (1) Illinois-Central Illinois Light Co. v. Stenzel, 44 Ill. App. 2d 388, 195 N.E.2d 207 (1963); (2) New Mexico-Public Service Co. of New Mexico v. Jasso, 96 N.M. 800, 635 P.2d 1003 (Ct. App. 1981); (3) New York-New York State Electric & Gas Corp. v. Fischer, 24 App. Div. 2d 683, 261 N.Y.S.2d 310 (1965); (4) Ohio-Ohio Power Co. v. Zemelka, 19 Ohio App. 2d 213, 251 N.E.2d 2 (1969); and (5) Virginia-Younger v. Appalachian Power Co., 214 Va. 662, 202 S.E.2d 866 (1974).
After a careful review of the two viewpoints, we have concluded that the majority view is the least complicated in its application and is more likely to make the plaintiff whole, and as a result we adopt that view as the law in Kansas. This rule will assure that damaged or destroyed property of vital interest to the public, such as a utility company power pole, will be promptly repaired or replaced on a simple, practical, noncontroversial basis.
The minority view is somewhat restrictive in scope. Its view is confined to damage caused to one pole out of hundreds, and it fails to take into consideration that the damaged pole is only one small part of a larger distribution system. The repair of one pole out of hundreds in a system simply restores the system to operation and the system itself is worth no more nor no less than it was prior to the replacement of that one pole. Indeed, the minority view cases suffer somewhat from inaccuracies, as noted by an Ohio court in Cincinnati Bell v. Cooper, 23 Ohio Misc. 2d 9, 10, 491 N.E.2d 411 (Ohio Mun. Ct. 1985), wherein the .court stated:
“Initially, it is inaccurate to view this matter as one involving damage to property solely. It is, in fact, most importantly, a case involving disruption and loss of service. Therefore, the correct measure of damages is the cost of reestablishing service, i.e., the cost of making plaintiff whole.”
In Hartford Electric Light Co. v. Beard, 3 Conn. Cir. Ct. at 325, in setting forth the majority view, the Connecticut court stated:
“As to the allowance of depreciation, it seems to us that the true issue is whether the replacement of the pole did more than make the plaintiff whole or whether, if it did, it would be just to make the victim of the wrong contribute so much of the cost as would reflect that further benefit. In short, at least upon the record before us, we cannot say with reasonable assurance that the installation of a new pole did more than remedy the wrong done. An injured party should not be required to lay out money, as the defendant’s approach would require, upon a questionable assumption that one day its worth will be recaptured. [Citations omitted.]”
We agree with the Connecticut court and hold, in this case, that the replacement of the pole did nothing more than make KP&L whole. We further are of the opinion that if there are any equities in a matter such as this, they lie with KP&L and that any small gain which can be measured through our approach to this question must be borne by the tortfeasor.
In short, although there is a life assigned to the poles as a group for tax and accounting purposes, there is no evidence that there was a discernable life expectancy for any particular pole in the system or that there was a program to replace a pole as it reached a certain age. In adopting the majority view, we adopt the language of N.J. Power & Light Co. v. Mabee, 41 N.J. at 442, as follows:
“It seems to us that the true issue is whether the replacement of the pole did more than make plaintiff whole and whether, if it did, it would be just to make the victim of the wrong contribute so much of the cost as would reflect that further benefit.
“If the life of every pole were 36 years and if it were clear that each pole would be replaced at the end of that period, defendants could well urge that a new pole clearly conferred a benefit beyond the amount of the damage done. The difficulty is that there is no discernible life expectancy of an individual pole and that although the period of 36 years is used for accounting purposes, the pole that was destroyed might well have served for a much longer period and the new pole may last for but a few years. Moreover, because of changes in circumstances or in technology, it cannot be known whether the pole would ever have been replaced. In short, at least upon the record before us, we cannot say with reasonable assurance that the installation of a new pole did more than remedy the wrong done. An injured party should not be required to lay out money, as defendants’ approach would require, upon a questionable assumption that one day its worth will be recaptured.”
A case similar to the instant matter is Water Power v. Miller, 52 Wash. App. 565. In that case, the Washington Court of Appeals stated:
“Here, the Millers argue WWP had recovered fifteen thirty-fifths of the cost of the pole through depreciation by the time of the accident. However, the trial court found the damaged pole had no set life expectancy. This finding is supported by the testimony that WWP replaces its poles only when necessary and that its poles last from 6 hours to 80 years. The court’s finding in turn supports a conclusion that WWP received no measurable benefit from replacing the pole beyond the immediate benefit of restoring its distribution system.
“Testimony relied upon by the Millers that utility poles have an ‘average’ life expectancy of 35 years does not prove this pole would have been in service only 20 additional years. The length of time this pole might have remained in the ground is pure speculation and speculation does not provide a sufficient basis for damages. [Citation omitted.] Consequently, we hold the court correctly denied the Millers a credit for depreciation. The facts here are distinguishable from those cases where the utility has a systematic program for replacing poles after a given number of years.” 52 Wash. App. at 571-72.
The evidence in this case is similar to the evidence in the Washington case cited above. We believe the reasoning set forth by the Washington court is relevant to the issue at hand and adopt that reasoning.
We hold, therefore, that KP&L is entitled to recover the cost of replacing or repairing the pole, without deduction for depreciation, that was damaged by the defendant’s negligence.
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Lewis, J.:
The plaintiffs appeal from the granting of summary judgment on behalf of the defendants. The trial court held that the plaintiffs’ claims against the defendants were barred by the statute of limitations and granted summary judgment in favor of all of the defendants as to the adult plaintiffs and summary judgment in favor of the defendants Lee and Unger as to the minor plaintiffs.
After a careful review of the record in this case, we have concluded that the trial court erred in granting summary judgment in favor of the defendants, and we reverse and remand.
The plaintiffs’ action contended that the defendants were responsible in a variety of ways for the injuries sustained by plaintiffs. These injuries, they allege, were caused by their inhalation of carbon monoxide fumes from 1981 to 1987.
The genesis of this lawsuit occurred in the year of 1977. In that year, the defendant Lee Construction Inc., (Lee) as general contractor, built a home in Garden City. The defendant Unger Heating and Air Conditioning (Unger) installed a two-fumace heating system in the house. The home was completed on August 1, 1977, and that was the last date on which the defendant Lee had any contact whatsoever with the furnace in question. The furnace was improperly vented on its installation and this condition existed from August 1, 1977, until sometime in 1987. When the house was completed, it was first sold to a Mr. Cantrell, who began to occupy it on August 1, 1977. There is no indication in the record whether Mr. Cantrell suffered any ill effects during the period of time he lived in the house.
In 1981, the McGraws purchased the house and began to occupy it along with their minor children. Kathryn McGraw began to feel ill during her first year of occupying the home, and her illness continued at least until November 24, 1987. Iona Ruth Gilger, the mother of Kathryn McGraw, moved into the home to live with the McGraws sometime in 1984 and almost immediately began to feel ill. Ry October 1985, every member of the household was experiencing some degree of ill health.
Although all members of the McGraw family became ill during their occupancy of the home, Kathryn McGraw experienced the most dramatic symptoms. She consulted with a number of physicians in an effort to determine the cause of her symptoms, which included headaches, nausea, dizziness, numbness, accelerated heart rate, hallucinations, extreme menstrual pain, shortness of breath, itching, sleep disturbances, and loss of memory. She consulted various medical experts to determine the cause of her illness, including gynecologists, internal medicine specialists, heart specialists, and urologists. At various times, Kathryn McGraw suspected or was told she was suffering from multiple sclerosis, gall bladder poisoning, Alzheimer’s disease, schizophrenia, and various “female” conditions. She consulted physicians in Garden City and Hutchinson, Kansas; Lajunta and Pueblo, Colorado; and Dallas, Texas. In addition to all of the disease processes Kathryn McGraw suspected for causing her problems, she suspected that the house in which she and her family were living might be contributing to her symptoms. Indeed, at various points in time, Kathryn McGraw suspected the source of her problems may have been the furnace located in the home.
In addition to consulting various physicians in an effort to determine the cause of her illness, Kathryn McGraw also contacted Unger and Peoples Natural Gas Company (Peoples) and requested that they check the furnace in the house. Peoples first checked the furnace in October 1982 and reported that it was operating properly. Again, in October 1985, both Peoples and Unger checked the furnace, at the request of the McGraws, and again reported that it was working properly. On one of the occasions, some malfunction was found with the furnace, but, at the same time, inspection revealed the presence of a bird’s nest in the venting system, which was removed. At no time did Peoples or Unger indicate the furnace was not properly vented.
In the present action, which was filed on November 16, 1987, plaintiffs alleged that the defendants Lee and Unger were negligent in designing and installing the heating system, causing plaintiffs to be exposed to toxic gases. The petition further alleged that Peoples was negligent in failing to find or correct that problem.
The defendants filed a motion for summary judgment and, after due consideration, the trial court granted that motion. The court found the plaintiffs knew or should have reasonably ascertained prior to November 16, 1985, that they had suffered substantial injuries caused by the negligent acts of the defendants. It held that the statute of limitations had run on their causes of action prior to the filing of the petition on November 16, 1987. The trial court also held that the minor plaintiffs were barred from bringing causes of action against the defendants Lee and Unger. The court determined that the minors’ causes of actions accrued on August 1, 1977, and became time barred on August 1, 1985. It also appears that the trial court may have concluded that, as to the adult plaintiffs, the ten-year “discovery” period established by K.S.A. .1989 Supp. 60-513 began to run on August 1, 1977.
WHEN WAS THE “FACT OF INJURY” REASONABLY ASCERTAINABLE?
The first issue deals with the application of K.S.A. 1989 Supp. 60-513(a) and (b) to the facts involved. The parties all agree that the plaintiffs’ action was one sounding in tort for negligence and was governed by the two-year statute of limitations set forth in K.S.A. 1989 Supp. 60-513. (The question of the cause of action of the minor plaintiffs is dealt with later in this opinion.) To resolve this issue, we must determine what knowledge is required for a “fact of injury” to become “reasonably ascertainable.”
K.S.A. 1989 Supp. 60-513(b) provides in pertinent part:
“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.”
In essence, if the “fact of injury” is immediately ascertainable, the statute begins to run on that date. If the “fact of injury” .is not reasonably ascertainable, then the statute of limitations does not begin to run until the fact of injury is or should be reasonably ascertainable.
The term “fact of injury” is a term of art and has not been interpreted literally by the courts of this state. There are a number of cases where the plaintiffs knew that something was wrong or knew that there was an injury, but did not know what caused that injury. In those cases, the Kansas courts have interpreted the term “fact of injury” to be that point in time when a plaintiff knew or should have known he had an injury caused by the negligence of the defendant.
In Hecht v. First National Bank & Trust Co., 208 Kan. 84, 490 P.2d 649 (1971), the facts indicated that the plaintiff had been undergoing radiation treatment for Hodgkins’ disease. She had discovered a burn on her skin which was not healing. She knew that she . had an injury but, when she consulted her physicians, they assured her that the condition was a normal result of the treatment and that it would heal itself. These reassurances were such that she delayed consulting another physician for some period of time. When the plaintiff finally received a “second opinion,” she was advised that her injury was the result of negligent x-ray treatments and that it would not heal itself. In discussing when the “fact of injury” became reasonably ascertainable, the court stated:
“We believe a fair analysis of the testimony of the three physicians deposed clearly indicates that as of March 13, 1966, none of them had made a diagnosis or prognosis of plaintiffs condition in terms of substantial injury since it was too early to do so with reference to the time of the treatments and the healing condition of plaintiff at the time. We do not believe that plaintiffs knowledge of her condition from her own observation, and that acquired from her physicians, is sufficient to justify a determination, as a matter of law, that she knew or could have reasonably ascertained on March 13, 1966, that she had suffered substantial injury caused by the alleged negligent treatment of defendants.” 208 Kan. at 92. (Emphasis added.)
In Knight v. Myers, 12 Kan. App. 2d 469, 748 P.2d 896 (1988), this court dealt with a case of legal malpractice. One of the issues was when the injury was reasonably ascertainable. This court, in Syl. ¶ 4, held as follows: “An injury is reasonably ascertainable when the plaintiff knew, or could reasonably have been expected to know, of the alleged negligence.”
In Cleveland v. Wong, 237 Kan. 410, 701 P.2d 1301 (1985), the Supreme Court dealt with a malpractice action. The evidence indicated that, as a result of prostate surgery, the plaintiff was told he would be temporarily incontinent and impotent. This prediction proved to be correct, but plaintiff later learned that his condition would be permanent and was the result of negligence on behalf of the defendant surgeons. The defendants argued that, since the plaintiff was both incontinent and impotent immediately after surgery, the “fact of injury” was apparent, and the statute of limitations began to run immediately. In rejecting this argument, the Kansas Supreme Court reasoned:
“The present statute provides that a cause of action against a health care provider accrues at the time of the occurrence of the act ‘unless the fact of injury is not reasonably ascertainable until some time after the initial act. ’ In this case the initial surgery was performed May 19, 1978. The second opinion, that of Dr. Bass, 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. Defendant contends that as plaintiff was both incontinent and impotent immediately following that surgery, the fact of injury was reasonably ascertainable to him. This contention, however, overlooks the evidence that Dr. Wong, as well as plaintiffs personal physician, advised the plaintiff that temporary incontinence and impotence were normal immediately following TUR surgery. Thus, while plaintiff knew 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 the defendant.” 237 Kan. at 414. (Emphasis added.)
The defendants in this case argue that the term “fact of injury” should be applied literally. They insist that plaintiff Kathryn McGraw knew she was ill, knew something was wrong, and knew she was “injured” shortly after moving into the house in 1981. The defendants reason that, under these circumstances, the “fact of injury” was known almost immediately and the statute of limitations started to run at that time as to her and, as to each of the other plaintiffs, on the date they became ill. They cite Roe v. Diefendorf, 236 Kan. 218, 689 P.2d 855 (1984), and Friends University v. W. R. Grace & Co., 227 Kan. 559, 608 P.2d 936 (1980), as authority in support of their argument. We do not agree.
Roe and Friends are both factually distinguishable from the instant matter. In Roe, the plaintiff was in an automobile accident in which the defendant was the driver of the other vehicle. The plaintiffs injuries were immediately apparent, as were the cause of those injuries — the negligence of the defendant. Friends involved a leaking roof wherein the plaintiff knew from the first rain after the roof was completed that it leaked and also knew immediately that the cause of the leak had to be defective materials or workmanship, or both. In fact, the court in Friends clearly distinguishes it from cases where the injuries were to the body of a plaintiff. Roe and Friends both stand for the proposition that the statute of limitations begins to run at the time both the fact of injury and the cause of injury are reasonably ascertainable. In those cases, plaintiffs attempted to extend the statute of limitations by arguing that, while the fact of injury was apparent to them, the extent of the injury was not. The court rejected that argument, holding that the key issue was the fact of injury, not the extent of injury. However, the court did so under a factual scenario where both the fact and cause of the injuries were immediately ascertainable to the plaintiffs.
We have been unable to uncover a Kansas decision which holds that the knowledge of the fact of injury alone was held to trigger the running of the statute of limitations. There are cases such as Roe and Friends where the language employed in the opinion would, if taken out of context, support that proposition. Those cases must be read in the light of the facts which underlie the decisions. In those decisions in which the plaintiff was aware of an injury or illness, but was unaware of who or what caused the problem, ascertainment of the “fact of injury” was not held to occur until the plaintiff could identify the cause of the problem and file suit against an identifiable defendant.
After a careful analysis of the Kansas cases pertaining to the issue, we hold that the “fact of injury” is not reasonably ascertainable until the plaintiff has discovered that a substantial injury has been sustained and has discovered that the cause of that injury is the negligence of the defendant. In. the instant matter, our holding means that the statute of limitations did not begin to run until the plaintiffs knew, or should have known, their health problems were caused by the negligence of the defendants.
WAS SUMMARY JUDGMENT PROPER?
Iri the instant matter, the trial court held that, as a matter of law, plaintiffs should have ascertained the “fact of injury” more than two years prior to November 16, 1987, and granted defendants summary judgment on the ground that plaintiffs’ cause of action was time barred.
Summary judgment forecloses access of a litigant to the trier of facts, which many in our society consider to be their “day in court.” The rules on the granting on this extraordinary remedy are well known, and we believe it should be approached with some trepidation in cases where the issue may turn on what a party’s perception should or should not have been. In Busch v. City of Augusta, 9 Kan. App. 2d 119, Syl. ¶¶ 2-3, 674 P.2d 1054 (1983), we said:
“A motion for summary judgment under the provisions of K.S.A. 60-256(c) is to be sustained only where the record conclusively shows there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. In considering such a motion the movant’s adversary is entitled tó the benefit of all reasonable inferences and doubts that may be drawn from the facts under consideration. Where the facts presented in the motion are subject to conflicting interpretations or reasonable persons might differ as to their significance, summary judgment is improper. It is only when it can be said that reasonable persons could reach but one conclusion from the same evidence that an issue may be decided as one of law. Summary judgment should never be granted merely because the court may believe movant will prevail if the action is tried on the merits.”
“An appellate court should read the record in the light most favorable to the party against whom summary judgment was entered. It should take such party’s allegations as true, and it should give him the benefit of the doubt when his assertions conflict with those of the movant. Factual infer enees tending to show triable issues must be considered in the light most favorable to the existence of those issues. If there is a reasonable doubt as to the existence of fact, a motion for summary judgment will not lie. Moreover, pleadings and documentary evidence must be given a liberal construction in favor of the party against whom the motion is directed.”
When we review this record and apply the rules set forth above, we conclude that summary judgment was improper on' the issue of the statute of limitations.
The question for determination is: When did the plaintiffs first ascertain that they had sustained substantial injuries as a result of the negligence of the defendants? This question can only be resolved by sifting through the thought processes.of these plaintiffs and making a determination as to when they should have perceived that the negligence of the defendants was the underlying cause of their illness. Under the facts of this case, that judgment cannot be made as a matter of law.
There are indications that at various times from 1981 to 1987 Kathryn McGraw suspected that the house was somehow involved in causing her symptoms. Indeed, there were occasions when she suspected and told others that the family was being poisoned by fumes from the furnace, and there were times she told others she suspected “carbon monoxide poisoning.” The defendants wish to seize upon these occasions and brand them as the date on which Kathryn knew or should have known that their negligence was causing the illness of the plaintiffs.
At the same time as Kathryn was suspecting the house, however, she suspected various other causes for her illness. During the time frame involved in these facts, she consulted various physicians, had a hysterectomy, and was told she suffered from gall bladder poisoning and might have multiple sclerosis.
The record indicates that, when the plaintiffs perceived the furnace as a possible cause of their problems, they called in Peoples and Unger to check out the operation of the furnace. At no time did Peoples or Unger advise plaintiffs that their furnace was improperly vented or that it was exposing them to toxic gas fumes. To the contrary, after each inspection, the plaintiffs were advised the furnace was working properly.
Based upon all of these factors, we are unable to conclude when the plaintiffs should have become aware of the negligence of the defendants. How much reliance could Kathryn McGraw place on the various diagnoses she received as to the cause of her illness? Were the plaintiffs entitled to rely on defendants’ assurances that the furnace was working properly, and to what extent did those assurances delay plaintiffs in ascertaining the true cause of their problems? We cannot answer those questions, and yet they must be resolved, or at least considered, in determining when the statute of limitations began to run in this case.
In Hecht v. First National Bank & Trust Co., 208 Kan. 84, the court held:
“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. [Citations omitted.] 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.
In Hecht, the plaintiff knew she had a serious burn, but her doctors advised her it was a normal result of medical treatment and would heal itself. This reassurance satisfied the plaintiff, who did not seek a second opinion until a substantial time later. It was as a result of that second opinion that the defendant’s negligence became apparent, but the second opinion was rendered more than two years after plaintiff first became aware that she had a serious burn.
In the instant matter, the defendants’ reassurances to plaintiffs about their furnace were such that it was not until the plaintiffs sought a “second opinion” that the improper venting was discovered. Plaintiffs argue that the statute of limitations did not begin to run until they had discovered the defendants’ negligence on November 24, 1985. We are not holding that the plaintiffs are correct in their argument, but we are holding that it does create a genuine issue of fact.
In Cleveland v. Wong, 237 Kan. 410, the evidence indicated that plaintiff had been assured by his physicians that his condition was the normal result of treatment. Thus reassured, the plaintiff did not discover that his injuries were the result of defendant’s negligence until he sought a second opinion some time later. Based on these facts, the Supreme Court held, in Syl. ¶ 2: “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.”
In this case, the “fact of injury” was not reasonably ascertainable until plaintiffs linked their symptoms to the improperly vented furnace. We cannot say, as a matter of law, when that linkage occurred or when it should have occurred. When viewed in the light most favorable to the plaintiffs, the evidence can be said to show that plaintiffs were misled and delayed from discovering that linkage by the assurances of the defendants Peoples and Unger that the furnace was working properly. There are also the various medical diagnoses to consider and what effect, if any, they had on the failure of the plaintiffs to discover defendants’ negligence at an earlier time. As a result, we hold that determination of this issue as a matter of law was error. To resolve this issue, complex questions of fact must be determined, and we hold that this is an issue which must be submitted to, and determined by, the trier of fact.
WERE THE CAUSES OF ACTION OF THE MINOR PLAINTIFFS BARRED BY K.S.A. 60-515?
The trial court held that the causes of action of the minor plaintiffs against the defendants Lee and Unger were barred by the provisions of K.S.A. 60-515(a). This statute reads:
“If any person entitled to bring an action, other than for the recovery of real property or a penalty or a forfeiture, at the time the cause of action accrued or at any time during the period the statute of limitations is running, is less than 18 years of age, an incapacitated person or imprisoned for a term less than such person’s natural life, such person shall be entitled to bring such action within one year after the person’s disability is removed, except that no such action shall be commenced by or on behalf of any person under the disability more than eight years after the time of the act giving rise to the cause of action." (Emphasis added.)
The defendants argued, and the trial court agreed, that, as to defendants Lee and Unger, the “time of the act giving rise to the cause of action” was August 1, 1977, the date the house was completed. As a result, the eight-year time period set forth in 60-515(a) ran on August 1, 1985, and the cause" of action of the minor plaintiffs was held to be barred by that statute.
It also appears that the trial court may have been laboring under the belief that the ten-year “discovery period” set forth in K.S.A. 60-513 also began to run on August 1, 1977, as to the adult plaintiffs. That conclusion was not critical to the decision of the court as it relates to the adult plaintiffs and, hence, creates uncertainty as to the court’s position. In order to avoid any confusion on remand of this case to the trial court, our decision with regard to the minor plaintiffs will apply with equal force to the ten-year period set forth in K.S.A. 1989 Supp. 60-513 that is applicable to the adult plaintiffs.
The question for our resolution is: How do we define the phrase “time of the act giving rise to the cause of action?” The defendants and the trial court have applied a literal construction of that phrase in holding that the act giving rise to the cause of action took place on August 1, 1977. This was the last date on which Lee and Unger were involved in installing the furnace. This application of the statute means that one-half of the eight-year period provided for the minor plaintiffs to file suit had expired before those minor plaintiffs were exposed to the alleged negligent actions of the defendants and before the minor plaintiffs had a cause of action against the defendants. We do not agree with this construction.
Just as air cannot exist in a vacuum, a cause of action cannot arise in one. In order for a plaintiff to have a cause of action against a defendant, two things must occur: (a) The plaintiff must have been injured; and (b) some entity or individual must have committed a wrongful act which caused the injuries to plaintiff. In our system, the mere fact of injury does not, standing alone, give rise to a cause of action. It is equally true that an act of negligence, standing alone, which causes no damage does not subject a defendant to litigation for committing that lone negligent act. It is only when the wrongful, negligent action damages another that a cause of action arises and subjects a defendant to liability.
It is true that in the instant matter the improper venting of the furnace must have occurred no later than August 1, 1977. However, since the plaintiffs did not move into the home in question until 1981, the defendants’ act of negligence did no harm to the plaintiffs until 1981, and plaintiffs had no possible cause of action against the defendants until 1981 at the very earliest. No cause of action arose in favor of these plaintiffs against the defendants on August 1, 1977, and, as a result, no act giving rise to a cause of action could possibly have occurred on that date.
In reaching this decision, we rely on three cases: two decided by federal district courts and one, the ultimate decision, decided by the Kansas Supreme Court.
In Colby v. E.R. Squibb & Sons, Inc., 589 F. Supp. 714 (D. Kan. 1984), plaintiff filed suit, alleging that the manufacturer of Diethylstilbestrol (DES) had caused her vaginal cancer. The evidence indicated that the plaintiffs exposure to DES occurred prior to her birth in 1952. The facts indicated that the mother of the plaintiff had taken DES during her pregnancy with plaintiff to forestall a threatened miscarriage. Thus, the plaintiff s exposure to the drug DES, which she contended caused her cancer, occurred while she was still in the womb. The defendant argued that the ten-year “discovery clause” in K.S.A. 60-513(b) had run long before plaintiff s action was filed. On this basis, the defendant filed a motion for summary judgment. The federal district court, in rejecting the defendant’s contention, held that the ten-year statute did not begin to run until plaintiff first sustained substantial injury, stating:
“While it is possible that the Kansas Legislature had a perverse intent when it enacted K.S.A. 60-513(b) in 1963, it is at least as reasonable to suppose that when it chose to employ the inelegant phraseology ‘time of the act giving rise to the cause of action’ it intended to focus on when the defendant caused injury that could, at least in principle, be detected, rather than when the defendant loosed its negligence into the air.” 589 F. Supp. at 716.
In Cowan by Cowan v. Lederle Laboratories, 604 F. Supp. 438 (D. Kan. 1985), plaintiffs brought suit on behalf of their minor daughter, whose teeth had allegedly been turned gray by her ingestion of tetracycline manufactured by the defendant. The action was filed in 1984, and the evidence showed that the minor plaintiff had begun to ingest the drug in 1968, had her last prescription for it in 1975, and may, in fact, have ingested it last in 1980. The court was faced with construing both K.S.A. 60-513(b) and 60-515(a) in order to determine when the “time of the act giving rise to the cause of action” occurred. In resolving this issue, the court rejected the date of “substantial injury” adopted in Colby and held that the date of “substantial injury” was the date on which the minor last ingested tetracycline. The court held that:
“As to Lisa Cowan, the two-year statute of limitations is also tolled by K.S.A. 60-515(a). At the time this suit was filed, Lisa was under 18 years of age. She was thus able to bring this action regardless of when she could reasonably have ascertained that she had been injured. The only circumstance under which she might lose the protection of this provision is if the ‘act giving rise to the cause of action’ occurred more than eight years prior to the date suit was filed. Under plaintiffs’ version of the facts, the act giving rise to the cause of action (Lisa’s ingestion of tetracycline) occurred in 1980. That was less than eight years prior to the filing of. this suit, on March 9, 1984. For purposes of this motion, we must accept the 1980 date as correct. Should defendant establish that Lisa’s last ingestion was actually in 1975, however, more than eight years would have elapsed between that ingestion and the filing of this- suit — thus depriving Lisa of this provision’s protection.” 604 F. Supp. at. 443.
In Tomlinson v. Celotex Corp., 244 Kan. 474, 770 P.2d 825 (1989), the Kansas Supreme Court chose the approach adopted in Cowan. That case was one in which the federal district court had certified a question to the Kansas Supreme Court of whether the ten-year limitation of 60-513(b) applied to claims involving latent diseases. The facts indicated that the plain tiff had been exposed to asbestos manufactured by the defendant and that his last exposure had occurred in 1971. The plaintiffs’ injuries due to the exposure did not become reasonably ascertainable until 1986, some 15 years after the last exposure. The Supreme Court held that the ten-year limitation did apply to latent diseases and that the date of the “act giving rise to the cause of action” occurred on the defendant’s last exposure to asbestos ip 1971, and his cause of action was time barred ten years thereafter. The court reasoned as follows:
“Whether the ten-year limitation contained in K.S.A. 60-513(b) applies to the plaintiff’s cause of action must be resolved by an analysis of the Kansas statute. As noted in Judge Kelly’s order of certification, the federal district court decisions interpreting subsection (b) have yielded- different results. The plaintiff, citing Colby v. E.R. Squibb & Sons, Inc., 589 F. Supp. 714 (D. Kan. 1984), argues that the ten-year limitation does not begin until the person bringing the action has received a substantial injury. Thus, he argues that the ten-year limitation did not begin to run upon his last exposure to asbestos in 1971, but upon the diagnosis of his asbestos-related injury in 1986.
“The ten-year limitation contained in K.S.A. 60-513(b) begins at ‘the time of. the act giving rise to the cause of action.’ In Colby, this phrase was interpreted to mean the date on which the plaintiff received a substantial injury and not the date of the defendant’s action.
“Chief Judge Earl E. O’Connor reached a different conclusion in Cowan by Cowan v. Lederle Laboratories, 604 F. Supp. 438 (D. Kan. 1985). In Cowan, the court, citing the analysis of Judge Rogers in Purcell v. Abbott Laboratories, No. 81-4237 (D. Kan., unpublished, June 2, 1982), held that the phrase ‘the act giving rise to the cause of action’ meant the date of the exposure of the injured party to the allegedly harmful substance, and not the date of the subsequent substantial injury.
“While it is possible to interpret the last clause of subsection (b) in isolation so that the ten-year maximum limitation period does not commence until the time of substantial injury, this interpretation requires separate and different interpretations of the phrase ‘the act giving rise to the cause of action.’
“ ‘It is the duty of courts to reconcile various provisions of an act in order to make them consistent, harmonious, and sensible if that can be done without doing violence to plain provisions therein contained.’ State, ex rel., v. Kalb, 218 Kan. 459, 464, 543 P.2d 872 (1975), modified 219 Kan. 231, 546 P.2d 1406 (1976). The various provisions of a statute should be construed together to result in consistency rather than inconsistency, if it is reasonably possible to so construe them. Terrill v. Hoyt, 149 Kan. 51, 55, 87 P.2d 238 (1939). In the present case, a consistent interpretation of the phrase ‘the act giving rise to the cause of action,’ as the phrase is used in the separate clauses of K.S.A. 60-513(b), requires interpreting the phrase to mean the defendant’s wrongful act, rather than the occurrence of a substantial injury.
“Applying this interpretation to the instant case, we conclude that 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 479-81.
If the Tomlinson court had intended to adopt the approach taken by the defendant, it would have literally construed the term “act giving rise to the cause of action.” Such a construction would hold it to have been the date on which the asbestos was manufactured, as this was literally the earliest wrongful act leading to plaintiffs’ injuries. Instead, the court followed a non-literal interpretation of the term. It held that the “act giving rise to the cause of action” accrued when plaintiffs’ injuries Were last caused by defendant’s negligent act even though those injuries may not have been readily apparent. This is consistent with the decision in Cowan in which the “act giving rise to the cause of action” was held to be the plaintiffs last ingestion of tetracycline rather than on the date which the defendants had manufactured the product.
Although the court in Ruthrauff, Administratrix v. Kensinger, 214 Kan. 185, 519 P.2d 661 (1974), held the ten-year provision not applicable, it remains an instructive case. In that case, the defendants had built a house and installed a water heater in 1959. The plaintiffs had purchased the house in 1969 and, in 1970, there was a fire and explosion which destroyed the house and caused the plaintiffs’ injuries. The plaintiffs filed suit in 1972, alleging that the cause of the explosion and fire was negligence by the defendants in building the house and installing the water heater in 1959. The defendants argued that the “act giving rise to the cause of action” occurred in 1959 when the house was built and the water heater installed. The plaintiffs argued that such a construction would have the effect of foreclosing the plaintiffs’ action before the cause of action accrued. The court held that the ten-year limitation simply did not apply in cases where the fact of injury was immediately ascertainable, thus avoiding the construction advocated by the defendant.
While the facts of each case differ, we have found nothing to indicate that the Kansas Supreme Court has held that a cause of action might accrue prior to the time that a plaintiff came into contact with the defendant’s wrongful act. In fact, in all of the cases cited above, that construction has been scrupulously avoided. In both Cowan and Tomlinson, the literal wrongful act occurred when the defendants manufactured the offending product. Yet, in each case, the time that the “act first gave rise to the cause of action” was held to be, that date when the plaintiff last had contact with and was injured by the defendant’s product.
We hold that, under the facts of this case, the “act which first gave rise to the cause of action” occurred in 1981 when plaintiffs moved into the house and were first exposed to the negligence of the defendants. The construction offered by the defendants would result in a cause of action accruing before the plaintiffs came into contact with the defendants’ negligence. This not only leads to a bizarre result, but it ignores the basic principles of tort law. The Supreme Court in Ruthrauff said:
“The time when a cause of action accrues and can be commenced has acquired an appropriate meaning in the law of Kansas. The terminology ‘when a cause of action has arisen’ and ‘when a cause of action has accrued’ are synonymous. Both phrases designate that first point in time when one party has the right to sue another for damages suffered. See Bruner v. Martin, 76 Kan. 862, 866, 93 Pac. 165, and Cleghorn v. Thompson, 62 Kan. 727, 64 Pac. 605.” 214 Kan. at 188.
Our construction of the phrase “act giving rise to the cause of action,” as having occurred on the date plaintiffs were first exposed to defendants’ negligence, is consistent with the definition offered in Ruthrauff above. This was the first possible point in time in which plaintiffs had the right to sue the defendants. The minor plaintiffs had eight years from this date to discover their injuries and the cause of their injuries and sue the defendants; the adult plaintiffs had ten years. Since that period began in 1981, it follows that suit filed in 1987 was well within the eight- and ten-year periods of discovery.
Reversed and remanded for proceedings consistent with this opinion. | [
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Lewis, J.:
The defendant/appellant, Phillip L. Waddell, appeals from the denial by the trial court of his motion to suppress the introduction of certain evidence obtained in the search of his person.
Finding no error, we affirm.
On November 30, 1987, Ronald Parker was performing his duties as a motorcycle traffic enforcement police officer in the City of Wichita. While in the performance of those duties, Parker heard tires squealing and turned to observe Waddell’s vehicle make a right turn at a rather high rate of speed. As Parker observed the vehicle, it was fishtailing and left of center.
Parker pursued Waddell, intending to write him a ticket for a violation of the traffic laws. Pursuant to signals from Parker, Waddell dutifully pulled his vehicle over, got out of the vehicle, and handed Parker his driver’s license. Parker detected the odor of alcohol on Waddell’s breath, determined that Waddell might be under the influence of alcohol, and asked Waddell to take part in some field sobriety tests, to which Waddell acquiesced without complaint or hesitation.
Waddell did not perform the field sobriety tests to Parker’s satisfaction, and Parker advised Waddell that he would have to remain at the scene until the Breathalyzer (BAT) van could arrive and a breath test could be conducted on Parker.
While waiting for the BAT van to arrive, Parker requested a license check on Waddell, which revealed that Waddell was driving on a suspended license.
After the field sobriety tests were conducted, Parker observed Waddell place his hand in his right pocket, pull something out of that pocket, and transfer it to his left pocket. After this observation, Parker instructed Waddell to turn around and place his hands on the trunk of the car while he, in his own words, “began a frisk.”
Parker testified that he did not “patdown” Waddell in a search for weapons. Instead, he reached into Waddell’s right pocket and pulled out a small, single-blade pocket knife. He then reached into Waddell’s left pocket and removed a brass pipe, which he knew to be a “hash pipe,” with some residue in the bowl, one brown vial, and one white vial with white residue in its base.
Upon being subjected to the appropriate chemical testing, the brass pipe and the vials were found to contain marijuana and cocaine. Waddell was charged with and convicted of possession of cocaine after a previous conviction, a class B felony, and possession of marijuana after a previous conviction, a class D felony. In addition to the felony charges, Waddell was convicted of driving under the influence, transporting an open container of a cereal malt beverage, driving while his license was suspended, and driving without proof of liability insurance.
Parker testified that, during the process of stopping the vehicle, conducting field sobriety tests, searching Waddell, and waiting on the BAT van, Waddell was polite and cooperative. Parker further testified that he had no fear that Waddell would attack him and no reason to believe Waddell had a weapon on his person. Parker also indicated that, at the time of the search of Waddell, Waddell was not under arrest but merely was detained for investigation and that he did not place Waddell under arrest until some time after the search.
The evidence further indicates that the result of Waddell’s Breathalyzer reading was 0.105.
Parker testified that persons who are found to be driving while their licenses are suspended are arrested and taken to the county jail, as are persons who are found to be driving with a breath alcohol concentration in excess of 0.10.
The State, in its brief, argues that the search was proper as being done incident to Waddell’s arrest. The obvious problem with the State’s argument in this respect is that Parker, as the chief witness for the State, testified that he had not arrested Waddell at the time of the search and did not arrest Waddell until sometime later. As we view the situation, the State is bound by the testimony of Parker on this issue. If Parker says, as he did, that Waddell was not under arrest at the time of the search, we will take him at his word; Waddell was not under arrest at the time of the search, and the search cannot be justified as incident to a lawful arrest.
The State argues that the search was proper under the doctrine of Terry v. Ohio, 392 U.S. 1, 20 L. Ed. 2d 889, 88 S. Ct. 1868 (1968), which permits “stop and frisk” searches under certain conditions. In that decision, the United States Supreme Court held that a police officer may conduct a stop and frisk search of an individual without violating that individual’s Fourth Amendment rights when he observes unusual, suspicious conduct, which leads him to reasonably conclude illegal activity may be occurring, and when he has a reasonable belief that his safety is in danger. The sole justification for the frisk is the officer’s safety and the extent of the frisk must be limited to meet that objective. 392 U.S. at 29-30.
In Kansas, we have codified the stop and frisk rules of Terry v. Ohio in K.S.A. 22-2402 (see State v. Hamilton, 222 Kan. 341, 344, 564 P.2d 536 [1977]). K.S.A. 22-2402 provides:
“(1) Without making an arrest, a law enforcement officer may stop any person in a public place whom he reasonably suspects is committing, has committed or is about to commit a crime and may demand of him his name, address and an explanation of his actions.
“(2) When a law enforcement officer has stopped a person for questioning pursuant to this section and reasonably suspects that his personal safety requires it, he may search such person for firearms or other dangerous weapons. If the law enforcement officer finds a firearm or weapon, or other thing, the possession of which may be a crime or evidence of crime, he may take and keep it until the completion of the questioning, at which time he shall either return it, if lawfully possessed, or arrest such person.”
In the instant matter, there can be no question but that the requirements of section (1) of the statute were complied with. Parker had the right to stop Waddell when he observed a violation of the traffic laws of this State.
The real question at hand is whether the search of Waddell’s pockets exceeds the frisk authorized by Terry v. Ohio and K.S.A. 22-2402(2). We hold that it did exceed authorized limits and that the search and seizure cannot be justified under the “stop and frisk” doctrine.
We note that, in order to justify a “frisk” search, the officer must reasonably believe that his personal safety is at risk. State v. Webb, 13 Kan. App. 2d 300, 302, 769 P.2d 34 (1989). Under Terry, the sole justification for the frisk is the protection of the officer, and the preservation of evidence is not a consideration to justify such a search. Any action outside the scope necessary to detect a weapon is unlawful. Terry, 392 U.S. at 97.
When we examine the record in this case, it is apparent that Parker had no fear of Waddell, nor did he have any reasonable basis for suspecting that Waddell may have had a weapon on his person. It seems to us that the primary justification for a frisk, i.e. concern for the safety of the officer, is not present. Even conceding that Parker had valid grounds to frisk Waddell, we are convinced that the “frisk” in this case went beyond the limits allowed.
The United States Supreme Court further discussed the rules set forth in Terry v. Ohio in Sibron v. New York, 392 U.S. 40, 20 L. Ed. 2d 917, 88 S. Ct. 1889 (1968), in which defendant was not known to the police officer who stopped and searched him. While that officer was on patrol, he had observed defendant talking to several individuals known by the officer to be drug addicts. Later, the officer saw defendant in a restaurant with three more drug addicts and ordered him to come outside. When defendant and the officer were outside the restaurant, the officer stated, “You know what I am after.” At that point, Sibron said something and reached into his pocket. Simultaneously, the officer put his hands into the same pocket and discovered several glassine envelopes containing heroin. The officer never testified he was in any fear for his safety. The Court found that the officer did not have reasonable grounds to search Sibron. 392 U.S. at 64. The Court further stated that, even if the officer had a justifiable fear for his safety, the frisk went beyond that allowed. 392 U.S. at 65. Under Terry, a search for weapons is limited to patting the outer clothing of the suspect for concealed objects which might be used as weapons, hence the term “patdown.” 392 U.S. at 65. The officer in Terry discovered concealed objects which might be used as weapons as a result of the patdown he did on Terry’s outer clothing and it was only after these items were discovered that he put his hands in defendant’s pockets. In Sibron, the officer made no attempt at an initial patdown to discover weapons, but immediately put his hands in Sibron’s pockets and took out envelopes of heroin. 392 U.S. at 65. The search in Sibron was obviously not limited to discovering whether the defendant was armed. The Supreme Court held, therefore, that the search violated Sibron’s Fourth Amendment rights and the evidence was suppressed. 392 U.S. at 65-66.
The Tenth Circuit in U.S. v. Santillanes, 848 F.2d 1103 (10th Cir. 1988), followed Sibron and noted that the scope of the search allowed under Terry is limited to patting down the outer clothing of the suspect for objects which might be weapons. In Santillanes, officers searched appellant’s pockets and discovered a beer can, money, and heroin. They searched appellant even though their initial patdown did not reveal weapons. The Court suppressed the evidence because there was no reasonable reason to frisk the defendant. Moreover, the Court found that the frisk of Santillanes went beyond that necessary to discover weapons. 848 F.2d at 1109.
In applying the logic of those cases to the present case, it is apparent that Officer Parker never patted down Waddell’s outer clothing before reaching into Waddell’s pockets. He testified that he never saw any bulges or suspicious-looking articles before he searched Waddell. He simply put his hands into Waddell’s pockets and removed what he found in those pockets. This search goes beyond that which is authorized by Terry v. Ohio and the companion cases cited above.
Under the facts, we hold that, since Officer Parker had no right to put his hands in Waddell’s pockets and remove items from those pockets without first patting him down to discover whether he had any weapons, the search of Waddell’s pants pockets violated his Fourth Amendment rights against unreasonable search and seizure. Therefore, the exclusionary rule should be applied unless an exception to it can be found.
The evidence in this case indicates that, even without Officer Parker’s illegal search of Waddell, the marijuana and cocaine in his pants pockets would have been inevitably discovered by lawful means by the police during an inventory search at the jail. The fact is, as a result of Parker’s license check, it was determined that Waddell was driving on a suspended license; as a result of the Breathalyzer test, it was discovered Waddell had 0.105 alcohol concentration in his breath and was presumed to be under the influence. Parker testified that, in Wichita, an individual found to be driving under either of these circumstances would be arrested and taken to jail. Factually, then, Waddell would have been arrested and taken to jail regardless of whether the search of his person had been conducted and, as an inevitable result of the inventory search of his person at the jail, the marijuana and cocaine would have been discovered.
We hold that the marijuana and cocaine found during the unlawful search of Waddell is admissible under the inevitable discovery exception to the exclusionary rule as enunciated in Nix v. Williams, 467 U.S. 431, 81 L. Ed. 2d 377, 104 S. Ct. 2501 (1984).
In Nix, the defendant was the primary suspect in the murder of a ten-year-old child whose body had not been found. Police officers agreed to transport Williams back to Des Moines, Iowa, without questioning him. At that time, a large search party, consisting of 200 volunteers, was conducting a systematic search of the area for the child’s body. As police were transporting Williams, one of the officers suggested that Williams should reveal the location of the body so that her parents could give her “a Christian burial.” This suggestion was apparently taken to heart by Williams who, shortly thereafter, revealed the location of the body as well as several other items of evidence subsequently admitted against him.
During his trial, Williams argued that the body and other items of evidence had been located as a result of an interrogation which violated his Sixth Amendment rights, and that, under the “fruit of the poisonous tree” doctrine, all evidence secured as a result of that unlawful interrogation should be excluded.
The United States Supreme Court held that, although the girl’s body and other evidence were indeed found as a result of the unlawful interrogation of Williams, this evidence remained admissible because of the Court’s conclusion that it would have inevitably been discovered lawfully by the search team which was combing the area.
The Court reasoned that the exclusionary rule was adopted to discourage and deter the police from violations of constitutional or statutory protections. If that was the basis of the rule, it reasoned that, if the State could prove factually that application of the rule would have no deterring value, the rule would not be applied:
“It is clear that the cases implementing the exclusionary rule ‘begin with the premise that the challenged evidence is in some sense the product of illegal governmental activity.’ United States v. Crews, 445 U.S. 463, 471 [63 L. Ed. 2d 537, 100 S. Ct. 1244] (1980) (emphasis added). Of course, this does not end the inquiry. If the prosecution can establish by a preponderance of the evidence that the information ultimately or inevitably would have been discovered by lawful means — here the volunteers’ search— then the deterrence rationale has so little basis that the evidence should be received. Anything less would reject logic, experience, and common sense.” 467 U.S. at 444.
The Court noted in Nix that the “ ‘vast majority’ of all courts, both state and federal, recognize an inevitable discovery exception to the exclusionary rule.” 467 U.S. at 440. While that statement may very well have been correct, it is Nix that recognized and adopted as the law of the land the inevitable discovery exception to the exclusionary rule. That exception allows the admission of unlawfully obtained evidence that ultimately or inevitably would have been discovered by lawful means.
In the case at hand, the marijuana and cocaine in Waddell’s pocket were unlawfully obtained by the unlawful search of Wad-dell by Officer Parker. However, because Waddell had chosen to drive while his driver’s license was suspended and with an alcohol concentration in his breath above 0.10, he would have been arrested and taken to jail on those charges regardless of the unlawful search. It was, therefore, inevitable that the contents of this pants pockets would have been discovered by lawful means during the arrest and booking process.
We are aware of no other reported case in Kansas in which the inevitable discovery exception to the exclusionary rule has been applied. However, we note that our Kansas Supreme Court has construed, rather liberally, several United States Supreme Court cases on exceptions to the exclusionary rule. For example, the Supreme Court has taken the decision of the United States Supreme Court in New York v. Belton, 453 U.S. 454, 69 L. Ed. 2d 768, 101 S. Ct. 2860 (1981), which expanded the right to warrantless search of an automobile, and has construed that decision rather liberally. See State v. Deskins, 234 Kan. 529, 673 P.2d 1174 (1983); State v. White, 230 Kan. 679, 640 P.2d 1231 (1982).
Given the current trend of the courts in narrowing the challenges to search and seizure and in expanding the authority of the police in that regard, it seems to be a logical progression to adopt the “inevitable discovery doctrine” as set forth in Nix v. Williams. We do so in this case and hold, as a result of that doctrine, the evidence against the defendant was properly admitted.
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Per Curiam:
Warren Brown Gillespie and Polly Gillespie Townsend (Beneficiaries) appeal from a district court order granting Robert W. Burdge’s and Grant-Thornton’s (Accountants) motion to dismiss pursuant to K.S.A. 60-212(b)(6). The court concluded K.S.A. 1989 Supp. 1-402 and the common law embodied in the Kansas cases requires dismissal of the Beneficiaries’ claims against the Accountants. We affirm the district court in dismissing all stated causes of action against the Accountants; but we find that the allegations, if taken as true for purposes of the motion to dismiss, and drawing all inferences favorably to Beneficiaries, support a cause of action for breach of trust. We affirm in part, reverse in part, and remand.
This case arises out of a trust formed April 20, 1956, by Warren E. Brown in which he and his two daughters, Dorothea Brown Wofford and Pauline Brown Gillespie, were the original trustees. The trust indenture provided that, upon the death of Warren E. Brown, the two remaining trustees would continue as the sole trustees; and, upon the death of Dorothea Brown Wofford, her daughter, Dorothea Wofford Seymour, would become a co-trustee with Pauline Brown Gillespie. The trust became irrevocable upon Warren Brown’s death in 1956. The trust was to terminate upon the deaths of Warren E. Brown and Pauline Brown Gillespie, with the entire trust to be distributed to the children of Pauline Brown Gillespie.
After the death of Dorothea Brown Wofford in 1974, Dorothea Wofford Seymour and Pauline Brown Gillespie served as trustees. In 1988, Pauline Brown Gillespie died and was survived by her two children, the Beneficiaries, who received the trust assets.
The Beneficiaries filed suit against Dorothea Wofford Seymour and numerous other defendants, including Robert Burdge and Grant-Thornton, the accountant and accounting firm which did tax and accounting work for the trust. The Beneficiaries alleged that, after Dorothea Wofford Seymour became a trustee, trust assets were invested in exploration, development, and drilling of oil and gas ventures headed by Arrowhead Petroleum, Inc., and Big Springs Drilling, Inc. Both companies are controlled by Dorothea Wofford Seymour, her husband, and her son. The Beneficiaries generally alleged that the trust was being charged amounts in excess of the services performed by Arrowhead Per troleum, Big Springs Drilling, and the Accountants; while at the same time the trust suffered losses. The Beneficiaries specifically alleged four causes of action against the Accountants: (1) negligence, malpractice, and breach of fiduciary duty, (2) breach of contract, (3) conversion and conspiracy, and (4) fraud and conspiracy.
The Accountants filed' a motion to dismiss pursuant to K.S.A. 60-212(b)(6). The trial court granted the motion, finding that pursuant to K.S-.A. 1989'Supp. 1-402 and Kansas case law the claims for relief against the Accountants should be dismissed. The trial court then ruled pursuant to K.S.A. 1989 Supp. 60-254(b) that the ruling adjudicates fewer than all the claims or the liability of fewer than all the parties and there was no just reason to delay entry of judgment for the Accountants on all counts. The Beneficiaries appealed.
In ruling on a motion to dismiss for failure to state a claim upon which relief can be granted, a plaintiffs allegations should be taken as true and all inferences should be drawn favorably to the plaintiff. Ling v. Jans Liquors, 237 Kan. 629, 630, 703 P.2d 731 (1985).
The facts stated in the Beneficiaries’ petition, which are relevant to the claims against the Accountants, are as follows: Since 1974, the trust corpus has been investing in various oil and gas ventures promoted and developed by Arrowhead Petroleum, Inc., and Big Springs Drilling, Inc. Both are companies in which one of the trustees or a member of the trustee’s immediate family has an interest. Grant-Thornton has performed accounting and tax services for the trust, Arrowhead Petroleum, and Big Springs Drilling. Burdge performed accounting and tax services for the trust and for the two companies until 1985, when he became an employee of Big Springs Drilling and a consultant of Arrowhead Petroleum. Since 1974, the trust has lost in excess of $10,000. We must determine whether these facts, when viewed in the light most favorable to the Beneficiaries, state any valid claim for relief.
In dismissing the action against the Accountants, the trial court relied in part on K.S.A. 1989 Supp. 1-402, which provides:
“No person, proprietorship, partnership, professional corporation or association authorized to practice as a certified public accountant pursuant to article 3 of chapter 1 of the Kansas Statutes Annotated, or any employee, agent, partner, officer, shareholder or member thereof, shall be liable to any person or entity for civil damages resulting from acts, omissions, decisions or other conduct amounting to negligence in the rendition of professional accounting services unless:
“(a) The plaintiff directly engaged such person, proprietorship, partnership, corporation or association to perform the professional accounting services; or
“(b)(1) the defendant knew at the time of the engagement or the defendant and the client mutually agreed after the time of the engagement that the professional accounting services rendered the client would be made available to the plaintiff, who was identified in writing to the defendant; and (2) the defendant knew that the plaintiff intended to rely upon the professional accounting services rendered the client in connection with specified transactions described in writing.”
K.S.A. 1989 Supp. 1-403 instructs that the act is not intended to modify existing common-law rules of liability except as stated in the statute.
The Beneficiaries, in their pleadings, fail to allege that they directly engaged the Accountants, that the Accountants knew at the time they performed their services the accounting would be made available to the Beneficiaries, or that they later agreed that the accounting would be given to the Beneficiaries. Further, the pleadings do not allege that the Beneficiaries were identified in writing, that the Accountants knew that the Beneficiaries intended to rely on the accountings, or even that the Beneficiaries did in fact see and rely on the accountings.
Considering the Beneficiaries’ allegations as true and drawing all inferences favorably to the Beneficiaries, they are insufficient under K.S.A. 1989 Supp. 1-402 to state a claim of relief based on negligence of the Accountants.
The Beneficiaries argue that the Accountants are liable for breach of fiduciary duty. In Paul v. Smith, 191 Kan. 163, 169-70, 380 P.2d 421 (1963), the court discussed the establishment of a fiduciary relationship as follows: .
“It has been recognized that a fiduciary relationship between parties does not depend upon some technical relation created by, or defined in, law. It exists in cases where .there has been a special confidence reposed in one who, in equity and good conscience, is bound to act in good faith and with due regard for the interests of the one reposing the confidence. [Citations omitted.]
“Fiduciary relationships recognized and enforceable in equity do not depend upon nomenclature; nor are they necessarily the product of any particular legal relationship. [Citations omitted.] They may arise out of conduct of the parties evidencing an agreement to engage in a joint enterprise for the mutual benefit of the parties. [Citations omitted.] But they necessarily spring from an attitude of trust and confidence and are based upon some form of agreement, either expressed or implied, from which it can be said the minds have met in a manner, to create mutual obligations. [Citations omitted.]
“For the plainest of reasons, agreements establishing fiduciary relationships, if not in writing, must be clear and convincing. Because' of the acuteness of the equitable remedies, courts will not reach out to establish legal relationships from which enforceable equitable rights may flow. A confidential relationship is never presumed, and the burden of proof is upon the party asserting it. [Citation omitted.]
“Mere concert of action, without more, does not establish a fiduciary relationship. [Citations omitted.] Undoubtedly, parties may deal at arm’s length for their mutual profit. It is only when, by their concerted action, they willingly and knowingly act for one another in a manner to impose mutual trust and confidence that a fiduciary relationship arises.”
A fiduciary relationship requires confidence of one in another and a certain inequity or dependence arising from weakness of age, mental strength, business intelligence, knowledge of facts involved, or other conditions which give one an advantage over the other. Olson v. Harshman, 233 Kan. 1055, Syl. ¶ 5, 668 P.2d 147 (1983).
The issue of whether an accountant employed by a company and a purchaser of the company’s stock formed a fiduciary relationship was discussed in Shofstall v. Allied Van Lines, Inc., 455 F. Supp. 351 (N.D. Ill. 1978). In Shofstall, the plaintiff purchased Allied stock without the knowledge that the Interstate Commerce Commission (ICC) had placed a restriction against the payment of dividends on the stock. The plaintiff alleged that Price Waterhouse, the accounting firm employed by Allied, breached its “fiduciary duty” to plaintiff by failing to disclose the ICC restriction on Allied stock. The court noted that the plaintiff had the burden of proving the existence of a fiduciary relationship and had failed to allege any facts which could lead to the inference that a fiduciary relationship existed between himself and Price Waterhouse. The court granted Price Waterhouse’s motion for summary judgment, finding the accounting firm did not owe the plaintiff a duty to disclose information regarding Allied’s policy against dividends. 455 F. Supp. at 359-60.
In Franklin Supply Company v. Tolman, 454 F.2d 1059 (9th Cir. 1972), Franklin Supply Co. (Franklin) and Servicios Hydrocarb C.A. (Servicios) entered into an agreement in which Franklin purchased all of the capital stock, of Petroleum Industry Consultants, C.A. (Peticon), which was a wholly-owned subsidiary of Servicios. Franklin and Servicios employed Peat, Marwick, Mitchell & Co. (PMM) to perform an audit of Peticon. Franklin later filed suit against PMM alleging that PMM failed to perform an independent audit because an employee of PMM was also an alternate director of Servicios and had been a director of Peticon. Franklin charged PMM of violating the fiduciary relationship between Franklin and PMM. Finding that no fiduciary relationship was formed between Franklin and PMM, the court stated:
“A ‘fiduciary relation’ is an elusive status to define. More often a fiduciary is a person who holds property or things of value for another — a trustee, executor, receiver, conservator or someone who acts in a representative capacity for another in dealing with the property of the other. Here, PMM was acting more in the capacity of arbitrator or fact finder not for one but for two persons. The duty of PMM was not to act as a fiduciary for Franklin; it was, rather, to act independently, objectively and impartially, and with the skills which it represented to its clients that it possessed, to make accurate determinations of fact. It would be liable for acting negligently or fraudulently.
“We do not say that a certified public accountant may never be a fiduciary. We do say it was not here.” 454 F.2d at 1065.
For a more recent case with a similar result, see Painters of Phil. D. Coun. v. Price Waterhouse, 879 F.2d 1146 (3rd Cir. 1989) (An independent public accountant performing a standard audit is not a fiduciary as defined by the Employee Retirement Income Security Act [ERISA].). ERISA defines a fiduciary as a person with discretionary authority or discretionary responsibility in the administration of a plan. 879 F.2d at 1149.
Here, the Beneficiaries have failed to allege any facts to establish a fiduciary relationship existed between themselves and the Accountants. There are no facts which illustrate the Beneficiaries formed an agreement with the Accountants or that an inequitable relationship existed between the Beneficiaries and the Accountants. The previously cited cases support the conclusion that a fiduciary relationship was not formed, rather, the Accountants were employed to perform independent accounting work for the trust. The Beneficiaries failed to state a claim for breach of fiduciary duty.
The Beneficiaries argue that the Accountants entered into a contract of employment with the trust to perform accounting services; that the Accountants breached their contract; and that the Beneficiaries, as third-party beneficiaries of the contract, may bring an action for breach of contract against the Accountants. Third-party beneficiaries to a contract were discussed in Noller v. General Motors Corp., 244 Kan. 612, 772 P.2d 271 (1989). The court instructed that the intent to benefit a third party must be clearly expressed in a contract, as otherwise contracting parties are presumed to act for themselves. 244 Kan. at 617. Third-party beneficiaries may be divided into two classes: intended beneficiaries and incidental beneficiaries. Beneficiaries expressly designated by a contract are intended beneficiaries and may sue to enforce a contract. Protection is not provided for incidental beneficiaries. 244 Kan. at 618.
Here, the Beneficiaries fail to show they were intended third-party beneficiaries under the accounting contracts between the Accountants and the trust. In addition, the Beneficiaries fail to set forth any terms of the contracts or to show that the failure of the . Accountants to tell them about the investments of the trust constituted a breach of contract. Accordingly, the Beneficiaries have failed to state a claim for breach of contract.
The Beneficiaries argue that, because the trustees failed to perform their duties, the Beneficiaries may step into the shoes of the trustees and bring suit against the Accountants for professional negligence. The cases cited by the Beneficiaries do not speak in terms of a beneficiary “stepping into the shoes” of the trustee. Those cases, however, do support the argument that, in a proper case, a beneficiary may have a cause of action against a trustee and/or a third party for breach of trust.
The rights of beneficiaries in such cases are discussed in Bogert, Trusts and Trustees § 901 (2d ed. 1982), as follows:
“Just as every owner of a legal interest has the right that others shall not, without lawful excuse, interfere with his possession or enjoyment of the property or adversely affect its value, so the beneficiary, as equitable owner of the trust res has the right that third persons shall not knowingly join with the trustee in a breach of trust.
“The civil liability of such a participant is stated in some codes as follows: ‘All persons aiding and assisting trustees of any character, with a knowledge of their misconduct, in misapplying assets, are directly accountable to the persons injured.’ Criminal liability of the third person may also be imposed.
“The principle applies to those who assist any fiduciary in the breach of his obligation, for example, executors and administrators, guardians, agents, and corporate officials.
“The wrong of participation in a breach of trust is divided into two elements: (1) an act or omission which furthers or completes the breach of trust by the trustee, and (2) knowledge at the time that the transaction amounted to a breach of trust, or the legal equivalent of such knowledge.
“Mere knowledge by a third person that a breach of trust is in process, coupled with a failure to notify the beneficiary or to interfere with the action of the trustee, does not amount to a participation in a breach. Such conduct is inaction which may be reprehensible under the highest standards of ethics, but no legal duty has been violated. On the other hand, if the third party by any act whatsoever assists the trustee in wrongfully transferring the benefits of the trust property to the trustee, another person, or the alleged participant, or aids in destroying or injuring that property, there has been conduct upon which liability can be predicated, if the requisite state of mind existed in the defendant.
“In order that the third party be liable as a participant, it is not necessary to show that he benefited as a result of the transaction.
“The performance of acts by an employee of the trustee, in carrying out the trustee’s orders, although they may further the breach of trust, do not necessarily make the employee a participant in the breach, but officers and directors of a corporate trustee who act for the corporation in committing a breach of trust may well be personally liable.”
The cases cited by the Beneficiaries instruct that a beneficiary may sue a third party for breach of trust. In Ehret v. Ichioka, 247 Cal. App. 2d 637, 55 Cal. Rptr. 869 (1967), the beneficiaries of a trust brought an action for breach of trust against the trustee and a third person to which trust property was transferred. The court stated: “[Wjhere the trustee acts in breach of trust, as by transferring property to a third person without consideration, the beneficiary’s right of action against either the trustee or transferee is well established. Further, if the trustee fails or refuses to act, the beneficiary can sue the third party.” 247 Cal. App. 2d at 645.
Similarly, in Booth v. Security Mutual Life Insurance Company, 155 F. Supp. 755 (D.N.J. 1957), three members of an international union brought a breach of trust action against the trustee of the trust fund of the union, an insurance company, and an insurance agent. The complaint alleged that money was taken from the trust fund and given to the insurance agent to pay for employee group insurance and that the insurance agent wrongfully retained over one-third of the money. The court, in finding the plaintiff had a right to sue the insurance company and agent for breach of trust, noted:
“ ‘The situation is different where the trustee in breach of trust transfers property to a third person. . . . The wrong which [the third person] commits is a wrong to the beneficiaries in taking or retaining the property after he has notice of the breach of trust, and he thereby incurs a liability to them, unless, indeed, he is a bona fide purchaser (not the case as to one who is alleged to have “assisted” in the breach of trust). In this situation, therefore, the beneficiaries can maintain a suit in equity against the transferee, if he took with notice of the breach of trust or paid no value .... Primarily the liability of the transferee is to the beneficiaries rather than to the trustee, and the right of the beneficiaries against the transferee is a direct right and not one which is derivative through the trustee.’ ” 155 F. Supp. at 761 (quoting 3 Scott on Trusts, § 294.1 [2d ed. 1956]).
Further support for finding that a beneficiary may bring a breach of trust cause of action against a third party can be found in Blankenship v. Boyle, 329 F. Supp. 1089 (D.D.C. 1971), in which beneficiaries to a mining workers’ welfare fund sued the fund trustees and the bank handling the trust money for breach of trust. The court found the bank entered into transactions with the trustees with actual or constructive knowledge that the transactions were in breach of the trustee’s fiduciary duty. The bank could be found liable for the resulting loss of income suffered by the beneficiaries due to the bank’s knowing participation in the breach of trust. 329 F. Supp. at 1103-04.
The alleged breach by the trustee in these cases involved intentional acts as opposed to negligent acts in which the third parties knowingly participated.
To state a cause of action for breach of trust, just as with K.S.A. 1989 Supp. 1-402, the Beneficiaries must allege more than mere negligence by the Accountants.
The Beneficiaries allege that the Accountants conspired with the other defendants and participated in the conversion of trust funds by overcharging the trust for services rendered. “The elements of civil conspiracy are (1) two or more persons; (2) an object to be accomplished; (3) a meeting of the minds in the object or cause of action; (4) one or more unlawful overt acts; and (5) damages as the proximate result thereof.” Stoldt v. City of Toronto, 234 Kan. 957, Syl. ¶ 5, 678 P.2d 153 (1984). “An action for civil conspiracy must be supported, as one of its elements, by one or more unlawful, overt acts which produce an unlawful result.” 234 Kan. 957, Syl. ¶ 6. Conversion is defined as the unauthorized assumption or exercise of the right of ownership over goods or personal chattels belonging to another to the exclusion of the other’s rights. Moore v. State Bank of Burden, 240 Kan. 382, 386, 729 P.2d 1205 (1986), cert. denied 482 U.S. 906 (1987). “An action for conversion will not lie for the recovery of an ordinary debt or account.” Temmen v. Kent-Brown Chev. Co., 227 Kan. 45, Syl. ¶ 3, 605 P.2d 95 (1980). To maintain an action for conversion, a plaintiff must have actual possession of the property or a right to immediately take possession of the property. An interest entitling a plaintiff to possession of the property at some time in the future is not sufficient to maintain an action for conversion. 18 Am. Jur. 2d, Conversion § 76, p. 199. In this case, the trust provided in part:
“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.”
The Beneficiaries lack standing to maintain a conversion action because they possessed a future interest in the trust but had no right to immediate possession of the trust funds. The Beneficiaries have failed to state a claim for conversion. Likewise, because the Beneficiaries cannot maintain an action for conversion, they similarly cannot maintain an action for conspiracy to convert the trust funds.
The Benficiaries 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. As previously stated, when ruling on a motion to dismiss pursuant to K. S.A. 60-212(b)(6), the motion must be decided from the well-pleaded facts of a plaintiffs petition. The question to be decided is whether, in the light most favorable to a plaintiff, the petition states any valid claim for relief. Woolums v. Simonsen, 214 Kan. 722, Syl. ¶ 2, 522 P.2d 1321 (1974). Dismissal is justified only when the allegations of the petition clearly demonstrate a plaintiff does not have a claim for relief under any possible theory. Dutoit v. Board of Johnson County Commrs, 233 Kan. 995, 998, 667 P.2d 879 (1983). As stated above:
“Just as every owner of a legal interest has the right that others shall not, without lawful excuse, interfere with his possession or enjoyment of the property or adversely affect its value, so the beneficiary, as equitable owner of the trust res has the right that third persons shall not knowingly join with the trustee in a breach of trust.
“[I]f the third party by any act whatsoever assists the trustee in wrongfully transferring the benefits of the trust property to the trustee, another person, or the alleged participant, . . . .” Bogert, Trusts and Trustees § 901.
Allegations that the Accountants knowingly joined the trustee and others in wrongfully obtaining trust funds in the form of overcharges, if true, would constitute a cause of action for breach of trust. The Beneficiaries’ petition is sufficient under K.S.A. 60-208(a) to withstand a motion to dismiss based on a breach of trust theory. The trial court erred in dismissing the third cause of action in counts three and four against the Accountants for conversion and conspiracy because the allegations, taken as true, could support a cause of action for breach of trust. Whether this cause of action can withstand a motion for summary judgment at the conclusion of discovery is not for us to decide now.
The Beneficiaries argue that the Accountants committed fraud by failing to inform them that the trust funds were being misused when the Accountants had a duty to speak. “Actionable fraud may be based . . . upon a suppression of facts which the party is under a legal or equitable obligation to communicate and in respect of which he could not be innocently silent.” DuShane v. Union Nat’l Bank, 223 Kan. 755, 759, 576 P.2d 674 (1978). An obligation to communicate arises from the relationship existing between the parties when the concealment is alleged to have occurred. If the parties are contracting, the relationship arises when there is a disparity of bargaining powers or expertise. The obligation also arises if the parties are in a fiduciary relationship. 223 Kan. at 760.
In In Re Gas Reclamation, Inc. Securities Litigation, 659 F. Supp. 493 (S.D.N.Y. 1987), purchasers of Gas Reclamation Units (Investors) from Gas Reclamation, Inc., (GRI) filed suit against Peat, Marwick, Mitchell & Co. (Peat Marwick) for common-law fraud, alleging Peat Marwick had an affirmative duty to disclose misstatements they discovered in GRI’s financial statements and on which Peat Marwick knew the Investors relied. The court held that Peat Marwick had no duty to disclose to the Investors fraudulent misconduct on the part of GRI and dismissed the claim of common-law fraud against Peat Marwick. 659 F. Supp. at 506. A similar result was reached in Latigo Ventures v. Laventhol & Horwath, 876 F.2d 1322, 1325 (7th Cir. 1989), in which the court held that the common law of Illinois does not require accountants to broadcast fraud by a corporate client to anyone who might buy the client’s stock. The court said:
“It is not the law that whenever an accountant discovers that his client is in financial trouble he must blow the whistle on the client for the. protection of investors — so that Laventhol & Horwath should have taken out an advertisement in the Wall Street Journal stating that it had just discovered that its client Xonics, Inc. was losing money, rather than waiting to report this in the next audit report. That would be an extreme theory of accountants’ liability, and it is one we decline to embrace as an interpretation of the common law of Illinois, having in previous cases specifically rejected it' as a possible theory of Rule 10b-5 aider and abettor liability. [Citations omitted.] There is no actionable nondisclosure without a duty to disclose, and in deciding whether there should be such a duty a court should attend to the practical consequences. Relations of trust and confidence between accountant and client would be destroyed if the accountant were duty-bound to make continuous public disclosure of all the client’s financial adversities. And the costs of auditing would skyrocket to compensate the accounting profession for the enormous expansion in potential liability, not to mention the increase in the costs of publication.” 876 F.2d'at 1327.
Here, the Accountants did not have a legal-obligation to communicate facts regarding the investment of the trust fund to the Beneficiaries. The parties did not enter into a contract or form a fiduciary relationship. The Beneficiaries, fail to state a cause of action for fraud upon which relief can be granted. .
The Beneficiaries argue the trial court erred by holding that K.S.A. 1989 Supp. 1-402 provides accountants protection from intentional torts and contracts. The Beneficiaries misconstrue the trial court’s order. The court found that K.S.A. 1989 Supp. 1-402 and the common law applied to all of the Beneficiaries’ claims. The court did not hold that K.S.A. 1989 Supp. 1-402 precludes an accountant from liability for intentional torts or < breach of contract, but rather it erroneously held that all of the. Beneficiaries’ claims could be dismissed in accordance with the statute and common law.
The Beneficiaries argue K.S.A. 1989 Supp. 1-402 violates Section 18 of the Bill of Rights of the Kansas Constitution. The Beneficiaries failed to raise this issue before the trial court. “['W]here constitutional grounds for reversal are asserted for the first time on appeal, they are not properly before the appellate court for review.” In re Residency Application of Bybee, 236 Kan. 443, 449, 691 P.2d 37 (1984). An exception to this rule exists when the constitutionality of a statute is at issue.
“ ‘The constitutionality of a statute should be considered in any action where it is necessary in order to determine the merits of the action or where the issues cannot be intelligently decided without doing so, notwithstanding the failure of the parties to raise the constitutional question, failure to plead the question, or failure to present the question to the trial court.’ ” Van Sickle v. Shanahan, 212 Kan. 426, 434, 511 P.2d 223 (1973).
Section 18 of the Kansas Bill of Rights provides that all persons shall have a remedy by due course of law. The legislature may modify remedies when required by public policy; however, when a common-law remedy is modified, an adequate substitute remedy for the right infringed or abolished must be provided. Kansas Malpractice Victims Coalition v. Bell, 243 Kan. 333, 350, 757 P.2d 251 (1988).
K.S.A. 1989 Supp. 1-402 provides an adequate substitute remedy for the common-law action of professional liability against an accountant. Under the common-law theory of professional negligence in most jurisdictions, an accountant must have actual knowledge that a certain class of persons will rely on the accounting before the accountant can be found liable. See Badische Corp. v. Caylor, 257 Ga. 131, 356 S.E.2d 198 (1987) (accountant may be liable for professional negligence to those persons or limited class of persons who the accountant is aware will rely on the information he prepared). Inv. Co. v. C. & L., 70 Ohio St. 2d 154, 436 N.E.2d 212 (1982) (accountant may be held liable to third party for professional negligence when that third party is a member of a limited class whose reliance on the accountant’s representation is specifically foreseen). K.S.A. 1989 1-402 simply codifies the common law governing an accountant’s liability for professional negligence. The statute does not aifect the rights of third-party beneficiaries or the rights of a trust beneficiary to bring an action for breach of trust against the trustee and a third party. K.S.A. 1989 Supp. 1-402 does not violate Section 18 of the Kansas Bill of Rights.
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Prager, J.:
J.J.C. (appellant), the natural father of J.L.D., appeals the district court’s termination of his parental rights pursuant to K.S.A. 38-1583, contending his due process rights were violated because he was not afforded the opportunity to be present at the termination hearing. We affirm.
The facts in the case are important and essentially undisputed. J.J.C. and B.D. are the natural parents of J.L.D. The record does not reflect whether the parents were ever legally married. Appellant was in Florida when his son was born on July 11, 1987. He returned to Kansas but was arrested in August 1987 and returned to Florida to face criminal charges. He had had contact with his son while in Kansas.
Appellant was convicted in Florida, of second-degree murder and robbery involving a firearm. He was sentenced to 42 years’ imprisonment and remains incarcerated in Florida. There was a dispute as to his eligibility for release. An SRS social worker’s affidavit advised the court appellant’s earliest release date would be in the year 2015.
The child and his mother apparently lived in Emporia, Kansas. Because of child abuse the district court issued an order placing the child in the protective custody of the Department of Social and Rehabilitation Services (SRS). On the same date, a petition was filed alleging J.L.D. to be a child in need of care because he was without adequate parental care and had been abused. J.L.D. was placed in a foster home. J.L.D. was found by the district court to be a child in need of care. The mother was present, but appellant apparently received nó notice of the hearing.
A petition was filed seeking termination of the parental rights of both parents. Appellant does not dispute that he had proper notice of this hearing. Counsel was appointed for each of the parents.
Counsel for appellant filed a motion to transport the natural father from Florida to the hearing. The court sustained the motion and granted the father a continuance.
The mother’s severance hearing was held, she was found to be unfit, and her parental rights were terminated. Shé did not appeal that decision.
Appellant’s attorney was granted an additional six-week continuance to attempt to secure appellant’s presence at the severance hearing. Thereafter, the hearing for the termination of the father’s parental right was held. He was not present, although both the State and the father’s attorney had contacted various Florida governmental officials to no avail. The parties were in agreement that it was not possible to obtain appellant’s release from prison for the hearing.
Appellant’s attorney objected to proceeding with the hearing in his client’s absence on the grounds that constitutional due process required the father’s presence at the hearing. The district court overruled the objection on the basis that every possible effort had been made to obtain the father’s presence, that the court had jurisdiction to hear the case, and that the severance hearing should proceed without the father’s presence.
The hearing proceeded, evidence was admitted, and arguments were presented by counsel. Appellant did not seek to testify by deposition or to submit written interrogatories. At the close of the hearing, the district court found J.L.D. to be a child in need of care and, after making findings of fact, found appellant to be unfit by reason of conduct and condition which render him unable to properly care for the child and that such conduct or condition is unlikely to change in the foreseeable future.
The trial court balanced the best interests of the child against the rights of the father and concluded that it had jurisdiction to proceed with the severance of parental rights under K.S.A. 38-1583. The district court entered its termination order, and counsel for appellant filed a timely notice of appeal.
The sole issue presented on this appeal is whether the district court erred by severing the natural father’s parental rights at a hearing at which the father was not present. Appellant does not, at least directly, challenge the sufficiency of the evidence on which the court based its finding that he was an unfit parent.
Appellant maintains that his right to due process under the Fourteenth Amendment to the United States Constitution was violated because his parental rights were severed at a hearing which, due to his incarceration, he was prevented from personally attending. He relies on the authority of In re S.M., 12 Kan. App. 2d 255, 738. P.2d 883 (1987).
In In re S.M., the appellant father was incarcerated in the Kansas State Penitentiary, serving a three-to-ten-year sentence, at the time of the hearing to sever his parental rights. His counsel filed three separate motions asking that the father be brought to the hearing from prison so that he might be present to participate. The district court summarily denied the motions without balancing the interests of the parties. The hearing proceeded without the presence of the father, although he was represented by counsel. His parental rights were severed.
The opinion in In re S.M. was written with an overly broad pen and would logically lead one to believe that a parent has an absolute right to be present at a severance hearing without regard to the particular circumstances in the individual case.
Simply stated, the broad concept set forth in that opinion is not supported by decisions of the United States Supreme Court or by the decisions of other appellate courts. See, e.g., In re Randy Scott B., 511 A.2d 450 (Me. 1986); In Interest of F. H., 283 N.W.2d 202 (N.D. 1979); Matter of Adoption of JLP, 774 P.2d 624 (Wyo. 1989). It cannot be disputed, however, that a parent has a fundamental liberty interest in maintaining a familial relationship with his or her child. In re Cooper, 230 Kan. 57, 631 P.2d 632 (1981).
When the State seeks to terminate the relationship between a parent and child, it must do so by fundamentally fair procedures that meet the requisites of due process. Santosky v. Kramer, 455 U.S. 745, 752-54, 71 L. Ed. 2d 599, 102 S. Ct. 1388 (1982). Thus, the question is in each case, including the case before us, what- process is due. Due process is not a static concept; rather, its requirements vary to assure the basic fairness of each particular action according to- its circumstances.
The leading case is Mathews v. Eldridge, 424 U.S. 319, 334-35, 47 L. Ed. 2d 18, 96 S. Ct. 893 (1976), which set forth three criteria to be considered: first,- the private interests that will be affected by the official action; second, the risk of an erroneous deprivation of such interests through the procedures used and the probable value, if any, of additional or substitute- procedural safeguards; and, finally, the government’s interest, -including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.
In Lassiter v. Department of Social Services, 452 U.S. 18, 27-31, 68 L. Ed. 2d 640, 101 S. Ct. 2153 (1981), the Mathews criteria were used to determine if an indigent parent was entitled to counsel to satisfy due process.
In In re Cooper, 230 Kan. 57, the Kansas Supreme Court applied the Mathews criteria in a deprived child proceeding, citing Mathews and Goldberg v. Kelly, 397 U.S. 254, 25 L. Ed. 2d 287, 90 S. Ct. 1011 (1970), and Lassiter v. Department of Social Services, 452 U.S. 18. In Cooper, the court stated in Syllabus ¶ 2 that a determination of the safeguards necessary to afford constitutional due process must be evaluated in the light of the nature of the proceeding and the interests affected.
In In re S.M., 12 Kan. App. 2d 255, the district court summarily overruled the father’s motions asking that he be released from prison to appear at the hearing, although his presence could have been obtained. The record failed to show that the trial court considered the essential factors set forth in Mathews.
In the present case, the evidence was undisputed that after diligent efforts were made by counsel the father’s personal presence in court could not be obtained. The father did not provide his testimony by deposition or written interrogatories and actually consented to the child’s adoption by the maternal grandparents. The father was serving an extended term in prison and would not be available to render proper care for the child within the foreseeable future.
Loss of parental rights is extremely important, but it should be weighed against the loss by the child of the right to a prompt judicial determination of his status. A prisoner serving a lengthy prison term should not be able to use his due process rights to foreclose permanently any severance proceedings.
A child should be afforded the opportunity to have a childhood complete with a family and caring parents. For J.L.D., his only hope for parents who can attend to his needs is through adoption.
We affirm the decision of the trial court, which balanced the child’s rights, the father’s rights, and the State’s rights and made the only reasonable decision possible — to proceed with the severance hearing.
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Sanders, J.:
Sports, Inc., appeals from a judgment of the district court finding that a certain letter of credit was ambiguous, that it had expired, and that the Citadel Bank of Wichita properly refused payment to appellant under the letter of credit.
On February 26, 1985, appellee Citadel Bank established an irrevocable standby letter of credit in favor of appellant Sports, Inc., covering the sale of merchandise from appellant to The Sportshop, Inc.
Appellant sold merchandise to The Sportshop, Inc., in the sum of $45,847.42 from June 20, 1986, to September 25, 1987. The Sportshop, Inc., never paid appellant for the merchandise.
On October 20, 1987, appellant submitted its sight draft for $25,000 to Citadel Bank. On November 5, 1987, Citadel Bank refused to pay appellant. The bank never sent appellant notice of nonrenewal of the letter of credit prior to November 5, 1987.
The parties submitted appellant’s claim to the trial court under a written stipulation of facts. The trial court found that the letter of credit had expired prior to appellant’s claim thereunder and granted judgment in favor of Citadel Bank. This appeal followed, the only issue being whether the district court erred in finding that the letter of credit had expired prior to appellant’s claim.
The letter of credit contained the following terms:
“It is a condition of the Letter of Credit that it shall be deemed automatically extended without amendment for one (1) year from the present or any future expiration date hereof unless thirty (30) days prior to any such date we shall notify you in writing that we have elected not to consider this Letter of Credit renewed for any such additional period. Upon receipt of such Notice, you may draw hereunder, without having incurred liability by reason of non-payment of accounts receivable or notes due and payable, by means of your draft on us signed according to the written certification that these are outstanding and are payable to SPORTS, INC.
“We engage with you that all drafts drawn under and in compliance with the terms of this credit will be duly honored on delivery of documents as specified if presented at this office on or before JUNE 30, 1985 or any automatically extended date, as hereinbefore set forth. We confirm that this Letter of Credit is hereby undertaken that all drafts drawn and presented as shown above specified will be duly honored by us.
“THIS CREDIT is subject to the ‘Uniform Customs and Practice for Documentary Credits (1974 Rev.), International Chamber of Commerce Publication No. 290.’ ”
The Kansas courts have never specifically addressed the problem of construction of letters of credit. Other states, however, have held and we likewise hold that letters of credit are governed by the rules applicable to the construction of ordinary contracts. Willow Bend Nat. Bank v. Commonwealth Mortg., 722 S.W.2d 12, 13 (Tex. App. 1986). First Nat. Bank of Atlanta v. Wynne, 149 Ga. App. 811, 256 S.E.2d 383 (1979).
This court restated the rules of contract interpretation in Kansas Gas & Electric Co. v. Kansas Power & Light Co., 12 Kan. App. 2d 546, 551, 751 P.2d 146, rev. denied 243 Kan. 779 (1988):
“The construction of a written contract is a question of law. [Citation omitted.] ‘Regardless of the construction of the written contract made by the trial court, on appeal a contract may be construed and its legal effect determined by the appellate court.’ [Citation omitted.] ... ‘A contract is ambiguous when the words used to express the meaning and intention of the parties are insufficient in a sense the contract may be understood to reach two or more possible meanings.’ [Citation omitted.]”
The trial court found the letter of credit ambiguous. We disagree. The terms of the agreement are clear and unambiguous. The letter states “it shall be deemed automatically extended . . . for one (1) year from the present or any future expiration date” (emphasis added) unless notice of nonrenewal is given. The letter also states proper drafts will be honored if presented “before June 30, 1985, or any automatically extended date.” (Emphasis added.)
The language used states that the automatic extension runs from, not until, any future expiration date. Additionally, the word “any” implies there could be several possible expiration dates.
The bank construes the provision “any future expiration date” to mean June 30, 1985, and the phrase “any automatically extended date” to mean June 30, 1986. Such a construction is contrary to the common sense meaning of the document and ignores the significance of the language following the June 30, 1985, date. We do not believe the document is susceptible to any other interpretation but that the date set forth in the document, June 30, 1985, is the present expiration date.
Thus, the letter of credit automatically renewed from June 30 to June 30 unless and until the bank notified Sports, Inc., in writing that it was electing not to renew the letter of credit. As noted above, the bank never sent such notice to appellant prior to receipt of the $25,000 sight draft on October 20, 1987.
The bank also argues that the letter of credit had no specific expiration date and that it would appear to remain in effect indefinitely in contravention of the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 290, Art. 37 (rev. 1974) which states: “All credits, whether revocable or irrevocable, must stipulate an expiry date for presentation of documents for payment, acceptance or negotiation, notwithstanding the stipulation of a latest date for shipment.”
This argument runs contrary to the bank’s first assertion that the letter of credit had already expired by its own terms. However, the fact that the letter of credit would extend automatically unless cancelled by the bank does not mean that the instrument contains no expiration date. We think it is clear that the expiration date is the first June 30 to occur after proper written notice from the bank to the appellant that it elected not to renew the letter of credit. The fact that the bank had not yet chosen to notify appellant of nonrenewal does not mean that the letter existed in perpetuity.
The trial court was in error in construing the letter of credit to be ambiguous and in finding that it had expired prior to the bank’s receipt of appellant’s sight draft.
Therefore, the judgment of the district court is reversed and the case is remanded with directions to the trial court to enter judgment in favor of Sports, Inc., against Citadel Bank of Wichita in the sum of $25,000, together with interest at the statutory rate from November 5, 1987, and costs. | [
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Gernon, J.:
In this interlocutory appeal, the City of Prairie Village appeals from an order of the district court sustaining Mark W. Eddy’s motion to suppress evidence obtained as a result of his arrest for driving under the influence of alcohol. We reverse and remand.
Eddy was originally arrested for a traffic infraction. A Prairie Village police officer first observed Eddy’s vehicle at 95th and Nall Avenue within the city limits of Prairie Village. The officer’s attention was drawn to the vehicle when Eddy came to a complete stop at that intersection, despite the fact that the signal light was green at the time. The vehicle then turned right onto Nall Avenue and proceeded northbound, but did not use a turn signal. The officer, knowing that a failure to use a turn signal is a yiolation of a municipal ordinance, followed thp vehicle northbound on Nall. Eddy’s vehicle proceeded north at a speed of approximately 20 m.p.h. The vehicle turned into the parking lot of 4 vacant office building in Overland Park. The officer followed the vehicle into the parking lot and arrested Eddy.
Eddy was convicted in municipal court, filed an appeal with the district court, and filed a motion to suppress “any and all evidence obtained following the arrest.” Eddy argued that the arrest itself was unlawful.
The trial court sustained the motion to suppress, reasoning that a municipal traffic infraction does not constitute a “crime” under K.S.A. 22-2401a, and, thus, the officer’s conduct did not qualify as fresh pursuit. The City appealed. ■
The City raises two issues on appeal: (1) Is a traffic infraction a “crime” under K.S.A. 22-2401a and 21-3105, and (2) did the officer’s actions constitute “fresh pursuit” under .K.S.A. 22-2401a?
■Whether a traffic infraction constitutes a “crime” is a question of law. Appellate review of a question of law is unlimited. Hutchinson Nat’l Bank & Tr. Co. v. Brown, 12 Kan. App. 2d 673, 674, 753 P.2d 1299, rev. denied 243 Kan. 778 (1988).
K.S.A. 21-3105 provides a. statutory definition of the term “crime,” ,
“A crime is an act or omission defined by law and for which, upon conviction, a sentence of death, imprisonment or fine, or both imprisonment and fine, is authorized or, in the case of a traffic infraction, a fine is authorized. Crimes are classified as felonies, misdemeanors and traffic infractions.
“(1) A felony is a crime punishable by death or by imprisonment in any state penal institution.
“(2) A traffic infraction is a violation of any of the statutory provisions listed in subsection (c) of K.S.A. 1984 Supp. 8-2118.
“(3) All other crimes are misdemeanors.”
In 1984 the Kansas Legislature amended K.S.A. 21-3105. The clear intent of that amendment was to include traffic infractions in the definition of crime. Therefore, the trial court erred in its conclusion that a traffic infraction was not a crime.
Next, the City argues that the officer’s arrest of Eddy was a result of a legitimate “fresh pursuit” pursuant to K.S.A. 22-2401a. The City asserts that the officer observed a failure to signal for a turn in violation of a municipal ordinance. The record indicates that this failure to signal for a turn, coupled with the officer’s observation of Eddy’s vehicle stopping for a green light, led the officer to conclude that he ought to make a “car check.”
K.S.A. 22-2401a governs the extraterritorial jurisdiction of municipal police officers. It provides:
"(2) Law enforcement officers employed by any city may exercise their powers as law enforcement officers:
“(a) Anywhere within the city limits of the city employing them and outside of such city when on property owned or under the control of such city; and
“(b) in any other place when a request for assistance has been made by law enforcement officers from that place or when in fresh pursuit of a person.”
In addition, K.S.A. 22-2401a(6)(c) provides a definition of the term “fresh pursuit.” “ ‘Fresh pursuit’ means pursuit, without unnecessary delay, of a person who has committed a crime, or who is reasonably suspected of having committed a crime.”
We conclude that the requirements of fresh pursuit were met in this case. It is clear that the officer’s pursuit of the vehicle was continuous and without delay. The critical determination is whether the officer’s pursuit was based upon his observation of a violation of the law or some other factor. The record supports the officer’s conclusion that his pursuit was based upon his observation of a traffic infraction, which is included as a “crime” under K.S.A. 21-3105. Hence, the arrest is valid as having been made after a fresh pursuit pursuant to K.S.A. 22-2401a(2)(b).
The trial court’s order sustaining the motion to suppress is reversed, and the case is remanded for further proceedings. | [
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Royse, J.:
The State appeals the trial court’s pretrial order suppressing evidence. The question raised in this appeal is whether a suppression order issued in a prior case precludes another judge from independently considering the suppression issue after the case has been refiled.
The procedural background is important to a resolution of the issues in the case. The State had filed charges against Douglas L. Heigele for possession of marijuana and possession of drug paraphernalia. Heigele filed a motion to suppress, which was set for hearing. The State requested a continuance because a necessary witness was unavailable. The district judge granted the request. At the second hearing date, the State again requested a continuance because a necessary witness had not been subpoenaed. This request was denied. The district judge granted the motion to suppress “as a sanction to keep a responsible pace with litigation.” The following day, the district judge granted the State’s motion to dismiss without prejudice.
After several months, the State instituted the present case by refiling the charges against Heigele. A different district judge presided over the new case. Heigele asked the judge to take judicial notice of the earlier case and to apply the prior suppression order to the second case. The judge took judicial notice of the suppression order and ruled that the order must be applied in the present case.
The first issue raised by the State is whether the district judge correctly determined that collateral estoppel mandated application of the prior suppression order in this case. “Collateral estoppel” means “ ‘when an issue of ultimate fact has once been determined by a valid and final judgment, that issue cannot again be litigated between the same parties in any future lawsuit.’ ” State v. Fisher, 233 Kan. 29, 35, 661 P.2d 791 (1983) (quoting Ashe v. Swenson, 397 U.S. 436, 443, 25 L. Ed. 2d 469, 90 S. Ct. 1189 [1970]). A necessary element of collateral estoppel is a judgment on the merits. Penachio v. Walker, 207 Kan. 54, 57, 483 P.2d 1119 (1971). The doctrine of collateral estoppel precluding relitigation of particular facts or issues does not extend to evidentiary facts or mediate data, as distinguished from the ultimate facts involved. Frey v. Inter-State Savings & Loan Ass’n, 226 Kan. 419, 422, 601 P.2d 671 (1979) (citing 46 Am. Jur. 2d, Judgments § 425, pp. 595-97). When applied to a criminal case, collateral estoppel means nothing more than double jeopardy. State v. Pruitt, 216 Kan. 103, 105, 531 P.2d 860 (1975).
The foregoing authorities make clear that collateral estoppel did not require application of the prior suppression order in this case. The sanction imposed in the first case did not determine an ultimate fact. The sanction was not a judgment on the merits. The proceedings in the first case never reached the point of placing the defendant in jeopardy. See State v. Ruden, 245 Kan. 95, 99, 774 P.2d 972 (1989); State v. Schilling, 238 Kan. 593, 602, 712 P.2d 1233 (1986).
Heigele argues that, because the State chose not to appeal from the sanction in the prior case, the State was bound by that order. This argument ignores the requirements of collateral estoppel. It presumes, without citation to any authority, that the State’s exclusive remedy is an appeal under K.S.A. 22-3603. But see State v. Zimmerman & Schmidt, 233 Kan. 151, 155, 660 P.2d 960 (1983) (noting State may refile complaint or appeal the discharge of defendant resulting from a preliminary hearing). But most importantly, Heigele’s argument ignores the fact that the State sought, and the district judge approved, a dismissal without prejudice of the prior case. The Supreme Court has emphasized that this procedure does not “prejudice a fresh prosecution on a new information charging the identical offense set forth in the prior information.” State v. Rowland, 172 Kan. 224, 227-28, 239 P.2d 949 (1952). As generally understood, the phrase “without prejudice” means “ ‘there is no decision of the controversy on its merits, and leaves the whole subject in litigation as much open to another application as though no suit had ever been brought.’ ” Frost v. Hardin, 1 Kan. App. 2d 464, 466, 571 P.2d 11 (1977), aff'd 224 Kan. 12, 577 P.2d 1172 (1978).
The second issue raised by the State is whether the district judge correctly determined that he had no discretion to consider the suppression issues in the second case. The Supreme Court has noted that a district judge may exercise discretion to re-entertain a motion to suppress evidence previously ruled on by another judge in the same case. State v. Riedel, 242 Kan. 834, 838, 752 P.2d 115 (1988); State v. Jackson, 213 Kan. 219, 226, 515 P.2d 1108 (1973); State v. Olson, 11 Kan. App. 2d 485, 488, 726 P.2d 1347, rev. denied 240 Kan. 805 (1986). It would be anomalous to conclude that such discretion is lacking in a totally separate case.
The question of discretion, however, is essentially a restatement of the collateral estoppel issue. Because collateral estoppel did not preclude the parties from litigating the suppression issue, and because the prior suit was dismissed “as though no suit had ever been brought,” the district judge had both the discretion and the duty to consider the suppression issue.
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Brazil, J.:
The State of Kansas takes an interlocutory appeal from a district court decision suppressing all the evidence obtained from a traffic stop because the stop was not premised on reasonable suspicion. Based upon the stipulation of Henry that he freely and voluntarily consented to the search of his vehicle and the glove compartment in his vehicle, we reverse.
Leonard Henry was charged with possession of methamphetamine and drug paraphernalia. Henry filed a motion to suppress the evidence which was submitted to the court on the following stipulated facts. In August 1989, a Hoisington police officer saw Henry driving a car. The officer recalled hearing that Henry’s driver’s license had been suspended and decided to stop Henry to check the status of his license. The officer contacted the dispatcher to confirm the owner of the car and the status of Henry’s license but did not receive any information back before stopping Henry approximately one block from his home. The officer smelled what he thought to be marijuana. Henry produced a valid driver’s license. After verifying the license, the officer asked to search the car and glove compartment. Henry authorized the search, and the officer found drugs in the glove compartment.
The trial court suppressed the evidence obtained after the stop because the stop was not based on an articulable suspicion. The trial court decided that Henry’s voluntary consent to the search of the car and glove compartment did not affect the admissibility of the evidence because the initial stop was illegal and the officer suspected that drugs were in the car only after talking with Henry about the traffic offense and observing his physical demeanor. The State filed an interlocutory appeal pursuant to K.S.A. 22-3603.
K.S.A. 22-2402(1) provides that a law enforcement officer may stop a person in a public place if the officer reasonably suspects the person is committing a crime. The Supreme Court has held that the statute requires that a police officer have a reasonable and articulable suspicion, based on objective facts, that the person stopped has committed, is committing, or is about to commit a crime. State v. Epperson, 237 Kan. 707, 712, 703 P.2d 761 (1985). “The reasonableness of the search is determined by the trial court from the facts and circumstances of the case.” State v. Kirby, 12 Kan. App. 2d 346, 352-53, 744 P.2d 146 (1987), aff'd 242 Kan. 803, 751 P.2d 1041 (1988). Reasonableness is based on the totality of the circumstances and is viewed in terms as understood by those familiar with the field of law enforcement. State v. Keene, 8 Kan. App. 2d 88, 90, 650 P.2d 716, rev. denied 232 Kan. 876 (1982).
The State argues the trial court applied the wrong standard in determining whether the officer had a reasonable suspicion to stop Henry. We disagree. The transcript of the trial court’s order reflects that the trial court stated the issue was whether the officer had an articulable suspicion to stop Henry to determine whether he was involved in ongoing criminal activity. The trial court then recited all of the facts it considered in ruling on the motion to suppress, which clearly demonstrate that it properly considered the totality of the circumstances.
1. The stop.
The trial court granted Henry’s motion to suppress and held the evidence seized from the car was inadmissible. In reaching this conclusion, the court held the initial stop was unreasonable because the officer lacked a reasonable and articulable suspicion to justify the stop. The motion to suppress was submitted to the trial court on stipulated facts. In such a case, this court on appellate review has as good an opportunity to examine and consider the evidence as did the trial court; and the proper standard of appellate review is thus de novo. Lightner v. Centennial Life Ins. Co., 242 Kan. 29, 31, 744 P.2d 840 (1987); Crestview Bowl, Inc. v. Womer Constr. Co., 225 Kan. 335, 336, 592 P.2d 74 (1979).
In Delaware v. Prouse, 440 U.S. 648, 663, 59 L. Ed. 2d 660, 99 S. Ct. 1391 (1979), the Supreme Court held that arbitrarily stopping a driver to check his license and car registration is unreasonable under the Fourth Amendment. A police officer must have reasonable articulable suspicion the driver is not licensed, the car is not registered, or the vehicle or an occupant is otherwise subject to seizure for a violation of the law. “What is reasonable is based on the totality of circumstances and is viewed in terms as understood by those versed in the field of law enforcement.” State v. Keene, 8 Kan. App. 2d at 90 (citing United States v. Cortez, 449 U.S. 411, 66 L. Ed. 2d 621, 101 S. Ct. 690 [1981]).
Here, the officer recalled hearing that Henry’s license was suspended or that he did not have a license. The officer’s belief was not based on firsthand knowledge. The officer knew Henry and knew where he lived. For reasons not explained in the stipulated facts, the officer determined it was necessary to stop Henry before he reached his home, although the officer had not yet received a response from the dispatcher. The fact that the officer knew Henry, knew where he lived, and had seen him. driving obviated the need of stopping him immediately. If warranted by the dispatcher’s response, the officer could have later arrested Henry based on his earlier observations. The trial court correctly decided that the officer lacked, reasonable articulable suspicion to stop' Henry.
2. The consent.
The trial court ruled that the officer acquired knowledge which led him to ask Henry if he could search the car only after the illegal stop and that Henry’s consent did not validate the search. The State argues Henry’s consent removes any taint from the illegal search, thereby making the evidence admissible.
The United States Court of Appeals dealt with a similar issue in United States v. Carson, 793 F.2d 1141 (10th Cir. 1986). In Carson, a deputy sheriff illegally looked under the defendant Carson’s vest and discovered dressed doves. Based on this discovery, the deputy contacted a state game protector, returned to the area where Carson was hunting, and received consent from Carson to search his truck. The deputy again looked under the vest and found the doves. Carson was charged with unlawful possession of doves. Carson filed a motion to suppress, which was denied. The court found that Carson’s consent to the second search purged the evidence obtained of any taint from the unlawful first search. The court held “that voluntary consent, as defined for Fourth Amendment purposes, is an intervening act free of police exploitation of the primary illegality and is sufficiently distinguishable from the primary illegality to purge the evidence of the primary taint.” 793 F.2d at 1147-48.
In deciding Carson, the Tenth Circuit reviewed Wong Sun v. United States, 371 U.S. 471, 9 L. Ed. 2d 441, 83 S. Ct. 407 (1963), in which the United States Supreme Court held that, although the evidence would not have come to light but for the prior illegal police conduct, such evidence is not inadmissible per se. The appropriate question is whether the evidence has been discovered by exploitation of the primary illegality or instead by sufficiently distinguishable means so as to be purged of the primary taint. 371 U.S. at 487-88. The Carson court decided that “ ‘exploitation of the primary illegality’ ” in the context of voluntary consent means that the police used the fruits of the primary illegality to coerce the defendant into granting consent. United States v. Carson, 793 F.2d at 1148. The court stated: .
“Under the Fourth Amendment, evidence obtained pursuant to defendant’s consent is admissible only if defendant’s grant of consent is voluntary under the totality of the circumstances. Schneckloth v. Bustamonte, 412 U.S. 218, 248-49, 93 S. Ct. 2041, 2058-59, 36 L. Ed. 2d 854 (1973). Therefore, in a case in which evidence is obtained pursuant to consent granted subsequent to illegal police actions, the ‘exploitation’ issue under Wong Sun is resolved simply by determining whether or not defendant’s grant of consent was voluntary under the totality of the circumstances. The police officers’ reason or basis for asking for defendant’s consent is irrelevant to the ‘exploitation’ issue unless the manner in which the police officers request consent renders defendant’s consent involuntary. When defendant’s grant of consent is voluntary, then there is no exploitation; as we will discuss infra, the findings of voluntary consent and ‘exploitation’ are mutually exclusive.” 793 F.2d at 1149.
To be voluntary, the defendant’s consent must be “ ‘unequivocal and specific’ ” and “ ‘freely and intelligently’ ” given. The consent must be given without duress or coercion, express or implied. The State bears the burden of proving voluntariness. 793 F.2d at 1150 (quoting United States v. Abbott, 546 F.2d 883, 885 [10th Cir. 1977]). The Kansas Supreme Court recently reiterated that the question of voluntariness should be decided in light of the totality of the circumstances, considering whether the individual was threatened or coerced and whether the individual was informed of his rights. State v. Ruden, 245 Kan. 95, 774 P.2d 972 (1989).
Here, the initial stop was not based on reasonable suspicion. However, the parties stipulated that Henry freely and voluntarily consented to the search of his car and glove compartment. As in Carson, Henry’s voluntary consent serves as an intervening act which is free of police exploitation of the primary illegal stop, thereby purging the evidence of the primary taint.
Reversed and remanded for further proceedings. | [
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Briscoe, J.:
This is a probation revocation case in which defendant Michael King appeals an order denying: credit for time he served in the custody of community corrections while on probation. After concluding K.S.A. 1989 Supp. 21-4614a applies to the sentence imposed after his probation revocation, we reverse and remand with directions to credit King’s sentence with the 127 days served in the custody of community corrections during probation.
In February 1986, King pleaded guilty , to three counts -of conspiracy to sell marijuana. He was sentenced to one- to two-year sentences on each count, the sentences to run concurrently, and was granted five years’ probation under the supervision of community corrections. The terms of his probation prohibited the violation of any state laws or the drinking of alcoholic beverages. King was held in community corrections for 127 days from March 20 until July 24, 1986. On March 22, 1989, King was arrested and charged with driving while under the influence of alcohol. On May 28, 1989, King was again arrested and charged with driving while under the influence of alcohol and driving with a suspended license. King’s probation was revoked on October 5, 1989. The district court gave King credit for 70 days spent in custody awaiting disposition of the revocation proceeding but denied credit for the 127 days he was held in community corrections in 1986.
The issue as identified by the parties is whether the district court erred in denying credit for time spent in custody as a .condition of probation. However, the controlling question is: When the legislature passes a statute protecting a defendant’s right to credit for time served during probationary periods, does the statute apply to all sentences imposed in subsequent probation revocation proceedings? We answer this question in the affirmative.
King argues the action revoking his probation and the imposition of sentence which followed occurred after 21-4614a took effect and, therefore, 21-4614a should govern computation of his sentence. The State keys its argument to the commission of the conspiracy to sell marijuana counts and King’s subsequent sentencing on those counts in 1986. The State argues (1) K.S.A. 21-3102(4), which states criminal cases are controlled by the law in effect at the time of the crime, governs; and (2) 21-4614a was passed after King committed the conspiracies and was sentenced for them and, therefore, is not controlling. The district court took a different view from the parties and focused upon when the time was served for which King seeks credit. The court held that, since the time served during probation was served before 21-4614a took effect, the new law did not govern.
At one time in Kansas, all decisions to grant persons credit for time served in jail as a condition of probation were discretionary. See, e.g., State v. Fowler; 238 Kan. 326, Syl. ¶ 5, 710 P.2d 1268 (1985) (citing K.S.A. 21-4614 and holding there is no statutory requirement that credit be given for jail time served as a condition of probation). With the passage of 21-4614a, the legislature changed the law and sentencing judges no longer have discretion in this area.
To determine whether 21-4614a, which became effective May 19, 1988, applies to the sentence imposed in the present case, we first look to the wording of the statute. It is a fundamental 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. Szoboszlay v. Glessner, 233 Kan. 475, 478, 664 P.2d 1327 (1983).
K.S.A. 1989 Supp. 21-4614a provides:
“(a) In any criminal action in which probation, assignment to a conservation camp or assignment to community corrections is revoked and the defendant is sentenced to confinement, for the purpose of computing the defendant’s sentence and parole eligibility and conditional release dates, the defendant’s sentence is to be computed from a date, hereafter to be specifically designated in the sentencing order of the journal entry of judgment or the judgment form delivered with the defendant to the correctional institution. Such date shall be established to reflect and shall be computed as an allowance for the time which the defendant has spent in a residential facility while on probation, assignment to a conservation camp or assignment to community correctional residential services program. The commencing date of such sentence shall be used as the date of sentence and all good time allowances as are authorized by law are to be allowed on such sentence from such date as though the defendant were actually incarcerated in a correctional institution.” (Emphasis added.)
In determining the scope of this statute’s applicability, we look to the statute’s introductory sentence which includes the following phrase: “In any criminal action in which probation ... is revoked and the defendant is sentenced to confinement.” (Emphasis added.) “Any” is defined as “one indifferently out of more than two: one or some indiscriminately of whatever kind: . . . one, no matter what one: every.” Webster’s Third New International Dictionary 97 (1986). Black’s Law Dictionary 86 (5th ed. 1979) states “[any] is often synonymous with ‘either,’ ‘every,’ or ‘all.’ ” Thus, using the common meaning of “any,” it is clear the legislature intended that the statute apply to every sentencing which occurs after probation has been revoked.
Under this reading of the statute, it becomes immaterial when the original crime occurred (the conspiracies) or when the time was served in jail as a condition of probation. If the legislature had intended to create the limitations asserted by the State and found by the district court, it could easily have done so. See, e.g., K.S.A. 1989 Supp. 21-4608(6) (limiting applicability of statute governing parole eligibility for those convicted of committing crimes on or after January 1, 1979). Since the legislature did not include such limitations in 21-4614a, it is not the role of this court to unilaterally read them into the statute. See Barber v. Williams, 244 Kan. 318, 324, 767 P.2d 1284 (1989).
Here, King committed the conspiracies to sell marijuana and served the time at issue before 21-4614a was effective, but when his probation was revoked and his sentence imposed the statute was effective. The statute makes credit for time served during probation mandatory rather than discretionary and discloses legislative intent to give criminal defendants placed on probation credit for all time spent in custody during probationary periods. “The statute places no limits, conditions, or discretion upon the grant of credit.” Brodie v. State, 1 Kan. App. 2d 540, 542, 571 P.2d 53 (1977). Therefore, the statute in effect at the time the sentence was imposed following revocation should govern.
Further, there is nothing in the statute to indicate the time served during probation must be served after the effective date of 21-4614a. Indeed, the statute states the sentence is to be computed from a date that “shall be computed as an allowance for the time which the defendant has spent in a residential facility while on probation.” (Emphasis added.) Thus, the attempt to limit the statute’s coverage to govern time served after passage of the statute must fail.
The State’s reliance on K.S.A. 21-3102(4) is misplaced. That statute provides:
“This code has no application to crimes committed prior to its effective date. A crime is committed prior to the effective date of the code if any of the essential elements of the crime as then defined occurred before that date. Prosecutions for prior crimes shall be governed, prosecuted and punished under the laws existing at the time such crimes were committed.”
The State argues King’s conviction in 1986 occurred before 21-4614a was effective and, therefore, under 21-3102(4), the new statute should have no effect.
By its reliance upon 21-3102(4), the State is asking us to apply the law in effect when the drug conspiracies were committed. Although the sentence imposed after revocation was the sentence originally imposed for the drug charges, the imposition of this sentence was triggered by the revocation of King’s probation. The acts in violation of probation occurred after 21-4614a was effective, probation was revoked after the statute was effective, and King was sentenced as a result of the revocation after the statute was effective. While 21-3102(4) states the general rule regarding the applicability of the criminal code to prosecutions, 21-4614a creates a specific rule applicable to sentences imposed following probation revocation. When there is a conflict between a statute dealing generally with a subject and another statute dealing specifically with a certain phase of it, the specific statute controls unless it appears that the legislature intended to make the general act controlling. State v. Wilcox, 245 Kan. 76, Syl. ¶ 1, 775 P.2d 177 (1989). The clear language of the statute reflects the legislative intent to apply 21-4614a to all sentences imposed in probation revocation proceedings occurring after the statute’s effective date and to allow credit for all time in custody during probationary periods, regardless of whether the crime for which defendant was placed on probation occurred prior to the statute’s effective date.
The district court’s order denying credit is reversed and remanded with directions to modify King’s sentence to include 127 days of credit for time served in the custody of community corrections during probation. | [
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Lewis, J:
This appeal is from the jury conviction of the defiendan t/appellant of the crime of nonsupport of a child as defined by K.S.A. 1989 Supp. 21-3605.
The appellant contends that his conviction should be reversed because the jury was permitted to find one of the essential elements of the crime, the element of parentage, by a preponderance of the evidence instead of beyond a reasonable doubt. We agree with the contentions of the appellant in this regard and reverse his conviction and remand for a new trial.
The crime of which appellant was convicted is defined by K.S.A. 1989 Supp. 21-3605, which states in pertinent part:
“(l)(a) Nonsupport of a child is a parent’s failure, neglect or refusal without lawful excuse to provide for the support and maintenance of the parent’s child in necessitous circumstances.
“(b) As used in this section, ‘child’ means a child under the age of 18 years and includes an adopted child or a child born out of wedlock whose parentage has been judicially determined or has been acknowledged in writing by the person to be charged with the support of such child.
“(c) At any time before the trial, upon petition and notice, the court may enter such temporary order as may seem just providing for support of such child, and may punish for violation of such order as for contempt.
“(e) If the court is satisfied by due proof that, at any time during the period while the obligation to support continues, the defendant has violated the terms of such order, the court may forthwith proceed with the trial of the defendant under the original charge, or sentence the defendant under the original conviction, or enforce the suspended sentence as the case may be.
“(f) A preponderance of the evidence shall be sufficient to prove that the defendant is the father or mother of such child. In no prosecution under this act shall any existing statute or rule of law prohibiting the disclosure of confidential communications between husband and wife apply, and both husband and wife shall be competent witnesses to testify against each other to any and all relevant matters, including the parentage of such child. Proof of the nonsupport of such child in necessitous circumstances or neglect or refusal to provide for the support and maintenance of such child shall be prima facie evidence that such neglect or refusal is willful.
“(g) Nonsupport of a child is a class E felony.” (Emphasis added.)
It is the principal argument of the appellant that, to the extent the statute permits proof of an essential element of the crime by less than the standard of “proof beyond a reasonable doubt,” it is unconstitutional and his conviction must be reversed.
It is a cornerstone of constitutional protections afforded to criminal defendants in this state and in these United States that their guilt must be proven “beyond a reasonable doubt.” Any instruction to a jury that proof of a defendant’s guilt may be established by a lesser burden of proof is constitutionally flawed and will not support a criminal conviction. The Kansas Supreme Court in State v. Douglas, 230 Kan. 744, Syl. ¶ 1, 640 P.2d 1259 (1982), stated: “The Due Process Clause of the Fourteenth Amendment requires that the factfinder rationally find proof beyond a reasonable doubt of each element of the crime charged. Following Jackson v. Virginia, 443 U.S. 307, 61 L. Ed. 2d 560, 99 S. Ct. 2781 (1979).”
Later, in State v. Flinchpaugh, 232 Kan. 831, 835, 659 P.2d 208 (1983), our Supreme Court stated:
“In a criminal prosecution, the defendant must be proven guilty beyond a reasonable doubt of each element of the crime charged. Fourteenth Amendment of the United States Constitution; In re Winship, 397 U.S. 358, 25 L. Ed. 2d 368, 90 S. Ct. 1068 (1970); State v. Douglas, 230 Kan. 744, 640 P.2d 1259 (1982).”
The United States Supreme Court, in Jackson v. Virginia, 443 U.S. 307, 61 L. Ed. 2d 560, 99 S. Ct. 2781 (1979), explained the basis behind the decision of In re Winship as follows:
“In Winship, the Court held for the first time that the Due Process Clause of the Fourteenth Amendment protects a defendant in a criminal case against conviction ‘except upon proof beyond a reasonable doubt of every fact necessary to constitute the crime with which he is charged.’ 397 U.S., at 364. In so holding, the Court emphasized that proof beyond a reasonable doubt has traditionally been regarded as the decisive difference between criminal culpability and civil liability. Id., at 358-362. [Citations omitted.] The standard of proof beyond a reasonable doubt, said the Court, ‘plays a vital role in the American scheme of criminal procedure,’ because it operates to give ‘concrete substance’ to the presumption of innocence, to ensure against unjust convictions, and to reduce the risk of factual error in a criminal proceeding. 397 U.S., at 363. At the same time, by impressing upon the factfinder the need to reach a subjective state of near certitude of the guilt of the accused, the standard symbolizes the significance that our society attaches to the criminal sanction and thus to liberty itself. Id., at 372 (Harlan, J., concurring).
“The constitutional standard recognized in the Winship case was expressly phrased as one that protects an accused against a conviction except on ‘proof beyond a reasonable doubt . . . .’In subsequent cases discussing the reasonable-doubt standard, we have never departed from this definition of the rule or from the Winship understanding of the central purposes it serves. [Citations omitted.] In short, Winship presupposes as an essential [element] of the due process guaranteed by the Fourteenth Amendment that no person shall be made to suffer the onus of a criminal conviction except upon sufficient proof — defined as evidence necessary to convince a trier of fact beyond a reasonable doubt of the existence of every element of the offense.” 443 U.S. at 315-16.
Tested by the constitutional principles enunciated by our Supreme Court and the United States Supreme Court as set forth above, it is clear that, in the instant matter, the conviction of the defendant violates his due process rights and must be reversed.
The trial court instructed the jury in the instant matter as follows:
“No. 2
“The defendant is charged with the crime of nonsupport of a child. The defendant pleads not guilty.
“To establish this charge, each of the following claims must be proved:
“1. That the defendant was an adoptive parent of Christopher John Rupert who was under the age of eighteen years.
“2. That the defendant willfully and without just cause failed, neglected or refused to provide for the support and maintenance of Christopher John Rupert who was then in necessitous circumstances; and
“3. That this act occurred on or about the 28th day of May, 1986 and continuously thereafter, in Saline County, Kansas.
“As used in this instruction ‘necessitous circumstances’ mean needing the necessaries of life, which cover not only basic physical needs, things absolutely indispendable to human existence and decency, but those things also which are in fact necessary to the particular person left without support. “To establish parentage it is only necessary that you be satisfied that the fact of parentage is more probably true than not true. Proof beyond a ‘reasonable doubt’ as set forth in Instruction No. 3 herein does not apply to the issue of parentage.” (Emphasis added.)
It is obvious from reading the above instruction that the jury was instructed that there were three elements of the crime that must be proven, but that one of these elements, the element of parentage, need not be proven beyond a reasonable doubt. A conviction based on such an instruction cannot stand, inasmuch as it violates the Fourteenth Amendment rights of a defendant, and it must be set aside.
In this case, the State introduced uncontroverted evidence that appellant had adopted Christopher John Rupert. Based upon this evidence, the State argues that the proof of parentage in the instant matter was clear and beyond any doubt and, as a result, the instruction was harmless error. We do not agree. We are dealing with the defendant’s constitutional rights in this case and we do not believe that an instruction, which on its face violates the defendant’s constitutional rights, could be, under any circumstances, considered harmless error.
We hold that, in a prosecution under K.S.A. 1989 Supp. 21-3605 for nonsupport of a child, paternity is an essential element of the crime charged and that it must be proven beyond a reasonable doubt. It follows, therefore, that the trial court committed reversible error in instructing the jury that paternity need be established only by evidence that is more probably true than not true.
In reaching this decision, we have been influenced by the decision of the Supreme Court of Appeals of West Virginia in State v. Clay, 160 W. Va. 651, 236 S.E.2d 230 (1977), wherein that court confronted a situation similar to the one at hand and took the position which is adopted by this court in the instant matter.
In concert with that West Virginia decision, we further hold that any application of K.S.A. 1989 Supp. 21-3605, relating to the proof of paternity, which permits proof of an essential element of the crime by any standard other than beyond a reasonable doubt is constitutionally impermissible.
The appellant has raised other issues concerning his conviction which we find to be without merit. We state this fact even though it is not necessary that we consider other issues of reversible error raised by the appellant in light of our decision on the issue concerning burden of proof.
As a result of our decision in this matter, we reverse the conviction of appellant and remand the matter for a new trial to be conducted in a manner consistent with this decision.
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