Knipe v. Barkdull

SALSMAN, J.

We reverse the judgment here as to appellant Nellie Knipe because it rests upon a finding of fact which has no support in the evidence or the record. We reverse the judgment as to both appellants because they were

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precluded from introducing any evidence on a pleaded cause of action upon which they relied for recovery.

Appellants and respondent entered into a written contract dated March 1, 1958. Under this contract appellants were given the right to log all the timber on respondent’s lands, and respondent was given the right to terminate the contract on three days’ notice. Appellants entered into the contract under the names of “Andy Knipe and Nellie Knipe, doing business as Salvage Logging Co.”

On September 17, 1958, Andy Knipe became bankrupt.

On March 25, 1960 appellants filed a complaint against respondent seeldng declaratory relief, an injunction and specific performance. Several causes of action are alleged in the complaint. In their third cause of action appellants allege that on January 23, 1959, appellants and respondent entered into an oral agreement by which appellants were given until December 22, 1959, to log respondent’s property, and in which oral agreement respondent waived her right to terminate the written contract of the parties on three days’ notice.

In her answer, respondent denied that any new oral contract had been entered into, and affirmatively pleaded that Andy Knipe became bankrupt on September 17, 1958; that the contract between appellants and respondent was a community asset and subject to Andy Knipe’s debts; that the contract passed to the trustee in bankruptcy, and that appellants are not real parties in interest, and further that all of appellants’ rights under the contract had been terminated by the giving of the three days’ notice.

When the case was called for trial, counsel for each party made an opening statement. Counsel for respondent urged that appellants were not real parties in interest in the litigation because the trustee in bankruptcy had sold Andy Knipe’s contract rights to one Carl Bishop, and that this sale had been confirmed by the referee in bankrupcty. Respondent then offered in evidence a copy of an order confirming sale signed by the referee in bankruptcy and which order confirmed the sale to Carl Bishop of “all the right, title, and interest of the Bankrupt in and to that certain Timber Contract existing between the Bankrupt and Bernice R. Barkdull dated March 1, 1958. ...” No other evidence or testimony was received by the trial court. The trial court expressed some concern as to the effect of the referee’s order confirming sale, and the right of the appellants to challenge the order.