author: J. Free Jones, Justice. John A. Fogleman, Justice,

text:
    J. N. HEISKELL et al v. H. C. ENTERPRISE, INC.
    5-4478
    429 S. W. 2d 71
    Opinion delivered May 13, 1968
    [Rehearing denied July 15, 1968.]

      Rose, Meek, House, Barron, Nash & Williamson, for appellants.

      Howéll, Price & Worsham, for appellee.
   J. Free Jones, Justice.

This appeal is from a judgment of the Pulaski County Circuit Court and arises from litigation growing out of the construction of the Little Rock Public Library building because of defect in tbe construction of concrete floors. H. C. Enterprise, Inc. was the general contractor for the construction of the building; J. N. Heiskell et al, constituted the Library Board of Trustees, and Guy Swaim and James C. Well-boim, d/b/a Swaim, Allen, Wellborn '& Associates, were the architects for the building.

In order to permit work on the various levels of the building to proceed without damage to finished floors, the plans and specifications prepared by the Architects called for the concrete floors to be poured in two separate slabs or layers. The base slab, containing coarse aggregate, was to be poured in forms and was to be from four to five inches thick. The base slab was designed to have poured on top of it the second layer, containing fine aggregate, and to be one and one-half inches thick. These two slabs or layers will hereafter be referred to as “base slab” and “fill slab.” The fill slab is designated “fill or mortar setting bed” in the specifications, and was to receive a vinyl tile finish floor covering. The defect giving rise to this litigation occurred between the two slabs of concrete.

The base slab was first poured by the Contractor and about 18 months later the fill slab was poured. After both slabs were poured, the fill slab started cracking and separating from the base slab and it was found that the fill slab had not bonded with, or adhered to, the base slab, and it became necessary to remove and replace the fill slab. An intensive investigation was conducted to determine the cause of the difficulty, which included reports by several testing laboratories employed by various parties.

Finally, in August of 1962, the Architects gave specific written instructions to the Contractor describing the manner of removal and replacement of the fill slab in the affected area. The Contractor replied in October of 1962, that a record of all labor, material and equipment costs was being kept on a time and material basis and as the original base slab and fill slab were installed in a workmanlike manner, this constituted a change in the work and requested a written change order under the contract. The Architects responded in November 1962, that in light of the laboratory testing reports, they felt the obligation of replacing the fill was on the Contractor and refused to issue a change order, requesting that the Contractor proceed under Article 19 of the contract whereby the Contractor must replace all work condemned as not in conformance with the contract, and that if this was not proceeded with immediately, an appeal would be made to the Contractor’s bonding company.

The Contractor proceeded with replacement of the fill without further correspondence until August 1965, at which time he requested and was refused payment for the work by the Architects.

Since the litigation involved the pouring and finishing of the two slabs, the specifications pertaining to them are fully set out as follows:

“Interior Slabs to Heceive Fill or Mortar Setting Bed shall be finished by tamping the concrete with special tools to force the coarse aggregate away from the surface, and screeding with straight edges to bring the surface to the required finish plane.
“Interior Slabs — that are to receive a finish floor covering (this -does not include ceramic tile covering) shall be finished by tamping the concrete with special tools to force the coarse aggregate away from the surface, then screeding and floating with straight edges to bring the surface to the required finish level. While the concrete is still green but sufficiently hardened to bear a man’s weight without deep imprint, it shall be wood floated to a true and even plane with no coarse aggregate visible. Sufficient pressure shall be used on the wood floats to bring moisture to the surface. After the surface moisture has disappeared, surfaces shall he steel-trowelled to a smooth, even impervious finish, free from trowel marks. After the cement has set enough to ring the trowel the surface of all slabs shall he given a second steel trowelling to a burnished finish. Where fill is applied and will receive a floor covering (not ceramic tile) fill shall be finished smooth in like manner.”

On January 14, 1966, the Contractor requested arbitration of its right to compensation under the contract, and the Library Board denied the request. The Contractor then brought suit against the directors for the additional cost of labor and materials in taking up and replacing the fill slab and the Architects were made third parties defendant.

Appellants argue that the plans and specifications called for a bonding of the two slabs by implication, and that the failure to secure a bond was the result of improper workmanship and failure of the Contractor to follow the plans and specifications. Appellee contends that the plans and specifications do not call for a bond and that the plans and specifications were followed explicitly in a good workmanship manner. All the parties seem to recognize that the trouble arose from the failure of the two slabs of concrete to bond with each other; that this resulted in the cracking of the fill slab and that it was necessary to remove and replace the fill slab. The Architects contended that the Contractor was negligent in pouring, curing, and finishing the concrete, and the Contractor contended that he poured, cured, and finished the concrete according to the plans and specifications prepared by the Architects and under the visual observation of the Architects. It was the Contractor’s contention that the fault lay in the plans and specifications prepared by the Architects and in the direct instructions of the Architects during the course of construction.

A jury trial resulted in a judgment in favor of the 'Contractor against the Trustees for $50,201.50 with judgment over in favor of the Trustees against the architects for the same amount.

The Architects and the Trustees are joint appellants here and they rely on the following points for reversal:

“Under the terms of the contract, the contractor cannot recover against the owner.
There is no competent evidence that the plans and specifications were deficient in any manner.
The undisputed evidence shows that the original work was not performed by the contractor in accordance with the plans and specifications.
The contractor is estopped to claim compensation and has waived any claim.
The Court erred in refusing to declare a mistrial when insurance was improperly brought to the attention of the jury.
The Court erred in admitting certain exhibits and testimony concerning change orders.”

As to point one, it is not disputed that the contract provides for changes in the work to be approved in writing prior to their execution. Appellee admits that this provision was not complied with, but argues that strict compliance with this provision was waived by appellants through course of conduct. As to this course of conduct, appellee produced exhibits and testimony tending to prove that on many occasions the Architects gave oral directions to the appellee to do certain work and after the work had been completed, the Architects would have the Library Board to pay for it. Appellants disputed this evidence as not being relevant to remedial work and that in this instance, the Architects specifically stated, prior to the execution of the work, that a change order would not be issued and thereby did not waive, but refused to waive, the written order. In addition to the exhibits and testimony pertaining to waiver, the appellee contends that it proceeded with the work in good faith, relying on the provision in the contract for arbitration of any of the Architects’ decisions.

Thus, a fact question was properly submitted to the jury on this issue and there was substantial evidence from which the jury could have found in favor of the Contractor, especially in light of the desire for completion of this public building as speedily as possible and within the time limit of the contract, and the threat by the Architects of proceeding against appellee’s bonding "company for delay. This court has upheld waiver in similar circumstances in Rivercliff Co., Inc. v. Linebarger, 223 Ark. 105, 264 S. W. 2d 842, when it was stated:

“For a second ground, appellant contends that the Master and the trial court should not have made any allowance to the Contractor because the extra work was not authorized in accordance with the terms of the contract. This contention appears to be supported by the terms of the contract, which provides that extras must be approved in writing prior to execution. This provision was not complied with but it does not constitute a defense available to appellant, because, as we hold, a strict compliance with this provision of the contract was waived by appellant in this instance. It is not disputed that the extra excavation was done with the knowledge and at the direction of Smith who was not only the architect supervising the work for Rivercliff but was also a part owner of the appellant corporation. From his testimony we gather that he refused to approve an allowance for extras mainly because he did not think the Contractor was entitled to anything as a result of the changed method of constructing the foundation. It appears that other changes in construction had been made and paid for where no written change order had been previously issued. Although it was shown that several such changes had been made and paid for during the construction of the four buildings, yet Mr. Smith testified that only one written change order had been made.”

Appellants’ second and third points involve the same problems and will be discussed together. In total effect, their contention is that there is no evidence that the plans and specifications were deficient, but that the evidence shows that they were not followed by the appellee.

The opinion reports from laboratory testing experts were offered in evidence by stipulation. Master Builders reported:

“* * * Any excess water in the concrete exhibited itself as bleeding water since relatively little of it was absorbed by the forms or, lost through it. This caused segregation to occur which in turn resulted in the accumulation of a highly carbonated cement paste layer on the top surface. Insufficient curing also helped in detrimental carbonation of the top layer in the base concrete.
Secondly, the surface of the base concrete was not scarified enough to expose good concrete cmd individual grains of aggregate and cement. * * *
The placement of a lightweight topping over a hardened base concrete is difficult at best since shrinkage stresses in the topping may cause trouble. In replacing the topping, the base slab will have to be physically scarified to sound concrete.” (Emphasis supplied.)

Masters Builders concluded:

“* * * Disruption of the bond between the base slab and the topping resulted from differential shrinkage of the two concretes, the topping being subject to the greater shrinkage subsequent to completion of the floor. * * * [T]he concrete of the base slab was not adequately cured or protected from drying so that a layer of weak, porous mortar exists in the upper 1/8 to 1/4 inch of the base slab. ’ ’

Oklahoma Testing Laboratory found and concluded:

u* * * wbite material was noted on the bottom of the two separate sections of lightweight concrete but none was noted on the interfaces of the sections of the cores. * * * An analysis was made of the white material. From this analysis it was apparently cement. * * * According to our understanding a period of eighteen months elapsed between these pours. According to our examination of the samples it would be our opinion that the lack of bond was due to one or a combination of the following:
1. Lack of proper surface preparation. An examination of the interfaces of the cores, and of the slabs submitted, shows the concrete to have been fairly smooth. On concrete of this age, to insure good bond, we believe the floor should have been, roughened by some method.”

St. Louis Testing Laboratories reported:

“* * * The unsound material at the top of the base concrete is, in our opinion, a major factor for the lack of bond between the base concrete and tbe lightweight concrete on the 1st and 2nd floors.
The canse for the nnsonnd material at the top of the base concrete may be attributed to three factors or a combination of these three factors — excessive water at top surface, excessive vibration, and improper curing.”

After a study of these reports, the appellant Architects advised appellee as follows:

“It is this office’s understanding, after a careful reading of these reports, that the major factor involved in the failure of the topping to bond with the base slab was the presence of a layer of unsound material in the top of the base slab. The laboratories recommended that this unsound material be removed by scarifying the base slab with a Ten-nant machine; cleaning the base slab carefully; saturating the base slab; brooming in a grout coat immediately ahead of placement of topping. * * * You are hereby instructed to proceed with the installation of the lightweight concrete topping throughout the building in accordance with the following procedure :
1. Remove all remaining original topping from the base slab in all areas and rooms. (Test panel on 1st floor to remain.)
2. Remove all laitance and the weak, unsou/ud surface portion of the base slab by scarifying with Tennant machine so as to expose sound mortar and coarse aggregate. Areas of slab adjacent to walls and columns not scarified by machine shall • be scarified by hand.” (Emphasis supplied).

Appellants presented evidence that the appellee did not follow the plans and specifications as designed, and that, according to custom and practice, a bond is called for between sections of concrete in situations such as this, unless it is provided in the contract that a bond is. not desired and positive action to prevent a bond is provided in the contract. On the other hand, appellee pre--sented evidence that the. work was done in accordance with the plans and specifications and in a good workmanlike manner; that the Architects’ representatives were present and inspected the work without complaint; and that the contract specifically called for a bond at construction joints (not a part of the concrete slab or topping in question), but did not call for a bond between the base slab and the fill, or provide for a bonding agent between the two. Appellee presented evidence pointing out that the Architects’ plans and specifications specifically called for the coarse aggregate in the base slab to be tamped away from the surface, leaving a layer of laitance in the surface of the base slab, which together with the slurry coat of cement ordered by the Architects ’ representative, constituted the weak white substance found by the testing laboratories and that this was the cause of the trouble. Suffice it to say, there was ample evidence presented on both sides to present a jury question on the points here involved, and there was substantial evidence from which the jury could have decided in favor of appellee on these points as they did.

Appellants’ point four contends that when the Contractor was directed to proceed with the work at its own expense and the work was done without protest, then the Contractor is estopped from later claiming compensation, but it is noted that appellants did not plead es-toppel in its answer. This court has held that estoppel must generally be pleaded to be available as a defense to a claim. In the case of Jewell v. General Air Conditioning Corp., 226 Ark. 304, 289 S. W. 2d 881, it was stated:

“Since neither laches nor estoppel was pleaded as a defense below, the court was not afforded an opportunity to pass on such issues and the attempt to raise them for the first time on appeal comes too late. Gerard B. Lambert Co. v. Rogers, 161 Ark. 307, 255 S. W. 1089; Bell v. Lackie, 210 Ark. 1003, 198 S. W. 2d 725; Steele v. Steele, 214 Ark. 500, 216 S. W. 2d 875.”

Notwithstanding appellants’ failure to plead estop-pel, when the appellee advised that a record would be kept of the additional costs and requested the change order, the appellants were put on notice that appellee expected pay. When the Architects refused to issue the change order, stating that the obligation to replace the fill was on the Contractor, a standoff was presented as to who was responsible, and we are of the opinion that the appellee-was justified in proceeding with the work, not as a waiver of his rights to dispute the Architects’ decision, but in reliance on the contract provisions calling for arbitration of any decision by the Architects, as testified to by Mr. Carty. Appellants contend, however, that the appellee did not make his request for arbitration until three years after the Architects’ decision not to issue a change order, and thus not within a reasonable time as required by the contract. The contract provisions as to notice of arbitration states:

“The demand for arbitration shall be made within a reasonable time after the dispute has arisen; in no case, however, shall the demand be made later than the time of final payment. . .”

It is not disputed here that the demand for arbitration came prior to the final payment. Appellee testified that the delay was due to ascertaining the cost of doing the work, but in any event, the reasonableness of the delay was a question for the jury. It is noted, however, that arbitration was rejected by appellants without prejudice to appellee’s rights to litigate his claims for additional compensation. We are of the opinion that the evidence does not support appellants’ contention that appellee waived its rights to compensation.

Under point five, appellants contend that the trial court erred in refusing to declare a mistrial after the attorney for appellee asked the jurors, on voir dire examination, whether they held stock- in, or had any interest in, a liability insurance company. We have held that it is reversible error to unnecessarily bring to the attention of a jury that insurance is involved and that the issue in questioning, on voir dire, as to interests in insurance companies is one of good faith by the attorney questioning the prospective juror. See DeLong v. Green, 229 Ark. 100, 313 S. W. 2d 370; Dedmon v. Thalheimer, 226 Ark. 402, 290 S. W. 2d 16. In the case at bar, the question was a general one and was not pursued after a negative reply. There were insurance clauses in the contract that would have supported good faith in believing that insurance was involved, and the jury was affirmatively advised that no insurance was involved. Under these circumstances, we agree with the trial court that there was no prejudice involved, and we find no prejudicial error on the part of the trial court in refusing to declare a mistrial.

Under appellants’ sixth point, they contend that the trial court erred in allowing exhibits and testimony to be admitted to show a course of conduct whereby appellants had waived strict compliance with contract provisions calling for a written change order prior to execution of the work, and on several occasions had verbally authorized changes without written order and later had paid for the work. Appellants contend that this evidence was not relevant to remedial work and did not involve situations where the Architects had specifically refused to issue a change order prior to the work being done. The Architects demanded that the appellee scarify the base slab and replace the fill slab. The appellee requested a change order which was refused. The Architects threatened appellee on its bond and we think that the appellee made it plain that it would demand pay when it proceeded with the work. We are of the opinion that the change order requirement of the contract did not go to liability for the costs of the remedial work in this case. There was no dispute as to the amount, necessity, or nature of the work to he done in this case. The question was whether the appellee was liable for redoing work it should have done right in the first place, or whether the Architects had made the error and were liable for the additional costs. The Architects refused to indicate an acceptance of liability by making the change order, and although appellee did the work without the change order, it did so with the appellants under no misapprehensions that demand would be made for the cost of the work and without prejudice to ap-pellee’s right to sue for that amount. We conclude that if error was committed by the admission of the evidence pertaining to prior waiver of written change orders, such error was harmless to the appellants in this case.

To summarize — This entire case simply boils down to pouring a heavy aggregate concrete slab base for a floor in metal forms designed by the Architects under specifications requiring that this base be finished by tamping the concrete with special tools to force the coarse aggregate away from the surface, and screeding with straight edges to bring the surface to the required finish plane. When the coarse aggregate was forced away from the surface, a layer of laitance, referred to by some of the witnesses as “soup,” but actually water, cement and fine sand, was drawn to the surface and after screeding, either with a bull float or some other straight edge, this base slab, laitance and all, was seasoned in use (;as apparently planned) for an approximate period of 18 months. When all the parties were ready to install the fill slab, the hardened laitance was not removed and the surface of the base slab was not scarified to the aggregate or sound concrete. The base slab was swept and mopped, wetted down and applied with a slurry coat of cement and water, under orders and directions of a representative of the Architects, and then a 1% inch slab of light aggregate concrete was poured on top of the base slab and it failed to bond with the base slab.

The evidence is undisputed that it was necessary to remove the hardened laitance from the surface of the base slab and to expose the sound concrete, by scarifying the surface of the slab, in order to pour the fill slab in such manner as to obtain a satisfactory floor in compliance with the contract. It is obvious to us that a jury question was presented by all the evidence in this case and the jury apparently found that the fault lay in the Architects’ plans and specifications. We conclude that there was substantial evidence to support the jury’s verdict and that the judgment must be affirmed.

Affirmed.

Fogleman and BbowN, JJ., dissent.

John A. Fogleman, Justice,

dissenting. I would reverse the judgment of the lower court. The major basis for my disagreement with the majority is the belated application of the contractor for arbitration. The difficulty giving rise to this cause of action became known to all in December 1961. After considerable investigation of the cause of the problem, the architect, by letter of August 14, 1962, gave specific written instructions- as to procedure with reference to the defect discovered. No reply by the contractor was made to the architect until October 12, 1962. The contractor’s letter of that date advised that the work directed in the architect’s letter had been undertaken and a considerable part of the required removal completed. This was the first advice that the contractor considered the instructions of August 14, 1962, to constitute a chang’e in the work in accordance with Article 16 of the General Conditions of the Contract. There was a specific demand for a change order, and the contractor advised that it was keeping a record of all labor, material and equipment cost incurred. On November 12, 1962, the architect advised that it was his opinion that the work was the obligation of the contractor and refused in unequivocal terms to issue a change order. This letter contained the following paragraphs:

“This matter must be immediately resolved. On several occasions, we have been advised verbally as to dates when the building would be turned over for occupancy, and this information has been passed on to the owner. It is not now possible to meet these dates. In the meantime, the city is deprived of the use of the New Library which should have been completed months ago.
We are asking, you to proceed immediately with the replacement of the topping under those parts of Article 19 of the General Conditions of the Contract as they apply. If this is not done immediately, we must advise the Owner to act under Article 21 of the General Conditions of the Contract and appeal to your Bonding Company.”

Nothing further was said or done about this decision of the architect until sometime in August 1965 when the contractor advised the architect that its costs in carrying out the architect’s instructions of August 14, 1962, amounted to $49,702.45 and again demanded a change order. This demand was refused by the architect in a letter dated December 27,. 1965, in which reference was made to the architect’s decision set out in the letter of November- 12, 1962. The contractor communicated with the owner about this demand for the first time by letter of January 14, 1966, in which a demand for arbitration was made. There is no evidence that the contractor’s contentions were ever made known to the owner prior to this time. The contractor stated that it did not send copies of its letters to the architect to the library board. The owner, through its attorney, A. F. House, rejected the demand for arbitration in a letter dated January 31, 1966. The letter contained this paragraph:

“The Library rejects your demand for arbitration with respect to each and all of the items set forth in your letter of January 14th. Article 40 of the General Conditions provides that ‘The demand for arbitration shall be made within a reasonable time after the dispute has arisen.’ On November 12,1962, the architects notified you that no change order would be issued, and, in their opinion, ‘the removal and replacement of the topping is the obligation of the contractor. ’ A delay of more than three years in asserting the claim set forth in paragraphs 1 and 3 of your letter is patently unreasonable. Furthermore, witnesses who were familiar with the inadequacy of your work have moved away, and one has died, and as the Library was not given notice that you intended to contest the ruling of the architects with reference to the items set forth in paragraphs 1 and 3, it has exhausted the funds allotted to it for constructing a new building.”

To me, the conclusion that the contractor accepted ihe decision of the architect is so inescapable that reasonable minds could not come to any other conclusion. I consider that appellee did not conform to the requirements of its contract. I further consider that it waived any right to arbitration that it might otherwise have had. These points were raised in appellants’ Point IV. This point related to both estoppel and waiver.

In considering these matters, it is necessary that the applicable terms of the contract be reviewed. They are:

GENERAL CONDITIONS
Article Í2 (in part): “He [the Contractor] shall make good any such damage, injury or loss, except such as may be directly due to errors in the Contract Documents or caused by agents or employees of the Owner, or due to causes beyond the Contractor’s control and not to his fault or negligence.”
Article 15 (in part): “In giving instructions, the Architect shall have authority to make minor changes in the work, not involving extra cost, and not inconsistent with the purposes of the building, but otherwise, except in an emergency endangering life or property, no extra work or change shall be made unless in pursuance of a written order from the Owner signed or countersigned by the Architect, or a. written order from the Architect stating that the Owner has authorized the extra work or change, and no claim for an addition to the contract sum shall be valid unless so ordered. ftThe value of any such extra work or change shall be determined in one or more of the following ways: * * * (c) By cost and percentage or by cost and a fixed fee. ¶ If none of the above methods is agreed upon, the Contractor, provided he receives an order as above, shall proceed with the work. In such case and also under case (c), he shall keep and present in such form as the Architect may direct, a correct amount of the cost, together with vouchers. In any case, the Architect shall certify to the amount, including reasonable' allowance for overhead and profit, due to the Contractor. Pending final determination of value, payments on account of changes shall be made on the Architect’s certificate.”
Article 16: “If the Contractor claims that any instructions by drawings or otherwise involve extra cost under this contract, he shall give the Architect written notice thereof within a reasonable time after the receipt of such instructions, and in any event before proceeding to execute the work, except in emergency endangering life or property, and the procedure shall then be as provided for changes in the work. No such claim shall be valid unless so made.”
Article 19 ,('in part): “The Contractor shall promptly remove from the premises all work condemned by the Architect as failing to conform to the Contract, whether incorporated or not, and the Contractor shall promptly replace and re-execute his own work in accordance with the Contract and without expense to the Owner * * *. ¶ If the Contractor does not remove such condemned work within a reasonable time, fixed by written notice, the Owner may remove it and may store the material at the expense of the Contractor.”
Article 31: “DAMAGES — Should either party to this Contract suffer damages because of any wrongful act or neglect of the other party or of anyone employed by him, claim shall he made in' writing to the party liable within a reasonable time of the first observance of such damage and not later than the final payment, except as expressly stipulated otherwise in the case of faulty work or materials, and shall be adjusted by agreement or arbitration.”
Article 38: “The Architect shall have general supervision and direction of the work. He is the agent of the Owner only to the extent provided in the Contract Documents and when in special instances he is authorized by the Owner so to act, and in such instances. he shall, upon request, show the Contractor written authority. He has authority to stop the work whenever such stoppage may be necessary to insure the proper execution of the contract. As the Architect is, in the first instance, the interpreter of the conditions of the Contract and the judge of its performance, he shall side neither with the Owner nor the Contractor, but shall use his powers under,the Contract to enforce its faithful performance by both. ¶[ In case of the termination of the employment of the Architect, the Owner shall appoint a capable and reputable Architect against whom the . Contractor makes no reasonable objection, whose status under the contract shall be that of the former Architect; any dispute in connection with such appointment shall be subject to arbitration.”
Article 39 (in part): “The Architect shall, within a reasonable time, make decisions on all claims of the Owner or Contractor and on all other matters relating to the execution and progress of the work or the interpretation of the Contract Documents. ¶[ The Architect’s decisions, in matters relating to artistic effect, shall be final, if within the terms of the Contract Documents. ¶ Except as above or as otherwise expressly provided in the Contract Documents, all the Architect’s decisions are subject to arbitration. ’ ’
Article 40: “ARBITRATION — All disputes, claims or questions subject to arbitration under this contract shall be submitted to arbitration in accordance with the provisions, then obtaining, of the Standard Form of Arbitration Procedure of The American Institute of Architects, and this agreement shall be specifically enforceable under the prevailing arbitration law, and judgment upon the award rendered may be entered in the court of the forum, state or federal, having jurisdiction. It is mutually agreed that the decision of the arbitrators shall be a condition precedent to any right of legal action that either party may have against the other. ¶ The Contractor shall not cause a delay of the work during any arbitration proceedings, except by agreement with the Owner. ¶ Notice of the demand for arbitration of a dispute shall be filed in writing with the other party to the contract, and a copy filed with the Architect. The demand for arbitration shall be made within a reasonable time after the dispute has arisen; in no case, however, shall the demand be made later than the time of final payment, except as otherwise expressly stipulated in the contract. [¡The arbitrators, if they deem that the case requires it, are authorized to award to the party whose contention is sustained, such sums as they or a majority of them shall deem proper to compensate him for the time and expense incident to the proceeding and, if the arbitration was demanded without reasonable cause, they may also award damages for delay. The arbitrators shall fix their own compensation, unless otherwise provided by agreement, and shall assess the costs and charges of the proceedings upon either or both parties.”
The specifications provide: “Re-examination of questioned work may be ordered by the architect and if so ordered the work must be uncovered by the contractor. If such work be found in accordance with the contract documents, the owner shall pay the cost of re-examination and replacement. If such work be found not in accordance with the contract documents, the contractor shall pay such costs.”

The contractor relies on Articles 15, 16 and 38 for recovery, but admits that the work was neither a minor change nor an emergency. It does contend that the architect is the agent of the owner under Article 38. Its only excuse for not making an earlier demand for arbitration is that it could not do so until the architect turned down its claim on December 27, 1965. Of course, this excuse should avail the contractor nothing because the architect had clearly made a decision rejecting this contention more than three years previously. Article 40 specifically provides for the continuation of the work during arbitration. The dispute to be determined originally was the decision that the contractor was at fault. The matter of cost, in case of a decision favorable to appellee, would have required a later decision by the architect under Article 15. This would not have been a matter for award under Article 40 incidental to the determination of the matter disputed.

Appellee admitted that it was directed by the architect on November 12,1962, to proceed in accordance with Article 19 of the General 'Conditions of the Contract at its own expense, and that it did proceed until the job was finished. Appellee’s president and only stockholder admitted that after receiving that letter, there was no donbt in his mind that it was the opinion of the architect that appellee was not entitled to payment for this work. He also admitted that there was not any donbt in his mind that the request for a change order had been rejected. He also admitted that there was no correspondence about this work between the contractor’s letter of December 1962 and that of August 1965. Although he says that there were numerous conversations with the architect and his representative in the intervening period, he does not suggest that there was any indication of an alteration of position in any of these conversations. He states that the architect did tell him in a conversation prior to the letter of November 12, 1962, to keep track of this cost, but did not say that payment would be made. The director of the Little Rock Public Library, the person designated to approve change orders on behalf of appellants, had no idea that appellants were going to be asked to pay for this work prior to receipt of the demand of January 14, 1966.

Mr. William Allen, the partner of the architectural firm having this job under his direction, died on March 13, 1967, before the trial. Mr. Kellogg, the construction inspector for the architects, died on August 25, 1964.

I do not see how it can be said that the request for arbitration, a necessary prerequisite to this action, can be said to have been timely made. For nearly three years every act of the contractor was consistent with the idea that it conceded the correctness of the architect’s decision, and inconsistent with any other thought.

The time limitation on a demand for arbitration was clearly stated. The decision of arbitrators was clearly a condition precedent to this action. It was to be made within a reasonable time after the dispute had arisen. This court has defined, or approved, definitions of the phrase “reasonable time.” In a case where the question was whether a notice to terminate a lease was given within a reasonable time, this court approved a definition declaring a reasonable time to be so much time as is necessary under the circumstances for a reasonably prudent and diligent man to do, conveniently, what the contract or duty requires should be done, having regard for the rights and possibility of loss, if any, to the other party to be affected. Citizens Bank Building v. L. & E. Wertheimer, Inc., 126 Ark. 38, 189 S. W. 361, Ann. Cas. 1917E 520. In Federal Land Bank of St. Louis v. Goodman, 173 Ark. 489, 292 S. W. 659, we said:

“* * * It may be said that what is a reasonable time in any case depends on the circumstances of that particular case, and means such time as a prudent man would exercise or employ about his own affairs. It, of course, does not mean indulgence in unnecessary delay on the one hand, nor does it mean that he is to act without any regard to the circumstances and convenience of transacting business of that kind. It is whatever time is necessary to conveniently do what should be done in the particular case. It has been said that it means such length of time as may fairly, properly, and reasonably be allowed or required, having regard to the nature of the act or duty and to the attending circumstances.”

A reasonable time is such a period as would suffice for the performance if the one whose duty it was to perform used such diligence, care and prudence as a person of ordinary diligence, care and prudence would use in the performance of a like duty under like circumstances. Alphin v. Matthews, 175 Ark. 1020, 1 S. W. 2d 79.

While the determination of what is a reasonable time under the circumstances is usually a question of fact, it becomes a question of law when the facts are clearly established, undisputed or admitted. First National Bank of Litchfield v. Pipe & Contractors’ Supply Co., 273 F. 105 (CCA 2d 1921); Colfax County v. Butler County, 83 Neb. 803, 120 N. W. 444 (1909); Rudolph Wurlitzer Co. v. Strand Enterprises, 7 Ohio Op. 336, 32 N. E. 2d 62 (1936); Goltra v. Penland, 45 Ore. 254, 77 Pac. 129 (1904); Hazelton v. First Nat’l Stores, 88 N. H. 409, 190 Atl. 280 ,(1937); Ridglea Interests, Inc. v. General Lumber Co., 343 S. W. 2d 490 (Tex. Civ. App. 1961). This is the case where the question is one of construction of a contract in writing*. Alford v. Creagh, 7 Ala. App. 358, 62 So. 254 (1913). See, also, Corneil v.Swisher County, 78 S. W. 2d 1072 (Tex. Civ. App. 1935). In Citizens Bank Building v. L. & E. Wertheimer, Inc., supra, the court reached the conclusion that under the undisputed testimony the time was reasonable and the facts did not call for a submission of that issue to the jury-

Two years delay in bringing* suit on a note not arising* from the conduct of the adverse party was held to be more than a reasonable time. Mehelm v. Barnet, 1 N.J.L. (Coxe) 86 (1791). A delay of nearly one year by vendor in obtaining title from a supposed owner upon whom he had some claim for a conveyance was held to be unreasonable. Saunders v. Curtis, 75 Maine 493 (1883). Three years after notice that a claim on a contractor’s bond was disputed was held not to be anything approximating a reasonable time for bringing of suit. Hurst v. Dawson Bros. & Beaver, 167 Tenn. 572, 72 S. W. 2d 767 (1934). Six weeks delay was held to be in violation of a rule requiring that a motion to set aside a judgment be made within a reasonable time but not later than six months after judgment. Marques v. Rapid Harvest Co., 1 Ariz. App. 138, 400 P. 2d 345 (1965). A delay of three years in moving to set aside a judgment was held to be unreasonable as a matter of law where a rule required the motion to be made within a reasonable time. Osterhus v. King Construction Co., 259 Minn. 391, 107 N. W. 2d 526 (1961).

Under the circumstances existing here, I do “not see how a conclusion that the time was reasonable could he reached.

Appellee’s argument that the time limitation is the time of final payment is not well taken. The language on which it relies is that “in no case, however, shall the demand be made later than the time of final payment.” It is quite clear that the expression of this ultimate limit did not in any way operate as a determination of what constituted a reasonable time or to extend the period for demand beyond a reasonable time. If this had been the intention, no reference would have been made to a demand being made within a reasonable time. The clause simply would have read: “The demand for arbitration shall be made not later than the time of final payment.” There is nothing ambiguous about the clause in Article 40 and its meaning is clear. The reference to the limitation on demands as the time of final payment actually serves as a diminution of the period to what might he said to be a shorter time for disputes which arise near the conclusion of the performance of the contract.

Appellee also contends that appellants have effectively waived the condition precedent to appellee’s right of action and the time limitation contained therein. Mr. House, the attorney for appellants, in a letter of February 22, 1967, stated that “acceptance of final payment [by the contractor] will not prejudice the rights of H. C. Enterprises, Inc. to litigate the claims for additional compensation.” I cannot agree that this statement constitutes an express waiver of the arbitration clause by appellants. Mr. House, by his statement, certainly cannot be held to have voluntarily relinquished his client’s right to stand upon the requirement of a decision by arbitrators prior to legal action by the contractor. Such is an absurd interpretation of his statement, if due and proper consideration be given the circumstances of the case. Appellants have denied liability throughout this proceeding. To say that by the above statement appellants’ counsel intended to thereby abandon a contractual defense to any possible right of recovery by appellee is preposterous. It seems inescapable to me that the only inference to be drawn from the statement is that the Library Board agreed not to contend that acceptance of final payment waived any breach by the Library Board, as it might have contended under the authority of such cases as Truemper v. Thane Lbr. Co., 154 Ark. 524, 242 S. W. 823. The contractor needed to receive payment for the uncontested work which it had performed. By the letter of February 22, 1967, counsel for the appellants agreed to allow it that payment without prejudice to its right to sue, but retained all defenses due the Library Board under the contract. He simply agreed that the contractor would not be giving up any rights.

It is not clear whether appellee is contending that this defense by appellants was barred by failure to plead estoppel. If it is, the point is not well taken because the trustees of the Little Rock Public Library did plead waiver by alleging that appellee had a right to ask for arbitration in 1962 but failed to do so and never informed the Little Rock Public Library of its claim for extra compensation until January 1966.

The distinction between waiver and estoppel has been clearly made by this court in cases such as Sovereign Camp W. O. W. v. Newsom, 142 Ark. 132, 219 S. W. 759, 14 ALR 903. Estoppel arises only where one party has been innocently induced to change his position for the worse by the act of the other party. Not so, in case of waiver. It is simply the voluntary surrender of a known right. Waiver has been clearly defined in Sirmon v. Roberts, 209 Ark. 586, 191 S. W. 2d 824, quoting from 67 C. J. 290, 291:

“* * * the voluntary abandonment or surrender, by a capable person, of a right known by him to exist, with the intent that such right shall be surrendered and such person forever deprived of its benefits; or such conduct as warrants an inference of the relinquishment of such right, or the intentional doing of an act inconsistent with claiming it. Thus, ‘waiver’ occurs where one in possession of a right, whether conferred by law or contract, with full knowledge of the material facts, does or forbears to do something, the doing of which or the failure or forbearance to do which is inconsistent with the right or his intention to rely upon it.”

I also feel that the trial court should have held as a matter of law that there was no waiver of the requirement for a change order as a basis for extra compensation. I do not agree that any course of conduct was shown which would have constituted a waiver under the circumstances existing here. In all of the previous instances there was no doubt that the work directed was “extra work.” None of the previous instances required any removal of work already done by the contractor, except where this was admittedly done because of a specific change in design. None of the previous instances followed an extensive investigation to determine the cause of a defective condition. In none of the previous instances had a change order been specifically and unequivocally refused. In each of the previous instances a change order was issued before payment was made. Nowhere is there an indication by any conduct that the Little Rock Public Library Board intentionally and voluntarily surrendured the right to require a change order before payment for any work, much less the type and nature of work required in this instance. The fact that change orders were issued after the work had been done in some cases did not justify an assumption by the contractor that the requirement of a change order was waived, and it proceeded at its peril. See Savignano v. Gloucester Housing Authority, 344 Mass. 668, 183 N. E. 2d 862 (1962). Certainly appellee proceeded at its peril in the face of a refusal of a change order after request therefor. In no instance had the owner paid for extra work where a change order had been refused. The contractor obviously did not think that the requirement of a chang’e order had been waived, else he would not have requested one.

I feel that the trial court should have directed a verdict for appellants.

I am authorized to state that BrowN, J., joins in this dissent.


source: Caselaw Access Project

author: Conley Byrd, Justice. John A. Fogleman, Justice,

license: Public Domain

text:
    FORD MOTOR CO. et al v. Lanell G. TRITT, Adm’x
    5-4486
    430 S. W. 2d 778
    Opinion delivered May 13, 1968
    [Rehearing granted September 3, 1968]

      Wright, Lindsey & Jennings• and Shaw, Jones & Shaw, for appellants.

      Sam Sexton Jr. and H. Clay Robinson, for appellee.
   Conley Byrd, Justice.

This personal injury action arising out of the death of Chester L. Tritt was brought by appellee, Lanell G. Tritt, Administratrix, for the benefit of herself as wife and next of lrin, against appellant, Burnham-Ray Company, Inc., the local Ford dealer, for breach of an implied warranty of fitness of a 1963 Ford pickup truck. Burnham-Ray filed a third party action against appellant, Ford Motor Company. From a $40,000 judgment in favor of the administratrix against Burnham-Ray Company, and a judgment against Ford Motor Company in favor of Burnham-Ray Company, both Ford and Burnham-Ray appeal, contending (1) that there was no substantial evidence that a manufacturing defect was a proximate cause of the accident; (2) that the provisions in the “Dealer Warranty” precluded a suit for personal injuries; (3) that there was a waiver or estoppel as to breach of a warranty other than the express warranty; (4) that the accident resulted from subsequent acts and omissions and intervening causes; and (5) that the contract between Burnham-Ray and Ford precluded the judgment against Ford.

The allegation with reference to the defect was:

“There is an implied warranty of fitness extending from the defendant to the deceased. This warranty was breached because the vehicle sold to the deceased had a defective axle and/or right rear wheel which resulted in the collapse of the wheel and proximately caused the death of Mr. Tritt.”

Decedent purchased the truck in December 1962. From the beginning, he had a problem with vibration. Burnham-Ray made numerous warranty repairs to the truck, including replacement of the rear axle housing and a new drive shaft. At the time of the fatal accident in March of 1964 at 11:00 p.m., the vehicle had 16,000 miles on it.

Harold Sorey was following some fifty to seventy feet behind the pickup at the time of the accident. The pickup was zigzagging or fishtailing back and forth after it rounded an “S” curve. It then ran off the pavement with the two left wheels, came back on the pavement, ran off the pavement with the right two wheels, came back on the pavement, turned sideways and turned over. Sorey said he saw the right rear wheel break down before the truck turned over.

Dr. Paul Cushman, retired professor of mechanical engineering of the University of Oklahoma and chief engineer of the L & S Roller Bearing Company, testified that he was consulted about a wheel that had been destroyed in the accident. After studying the wheel and learning something about the history of the truck he was asked:

“Q. Now, Dr. Cushman, what was there about the wheel that caused you to want to examine the axle?
A. Well, I knew something about the history of the truck besides what I had seen examining the wheel.
Q. But outside the history of the truck, just the physical evidence of the wheel itself?
A. I will point to several of these rivet holes of having apparently broken down one or two at a time, and the three on this side not being displaced and two of them being practically not displaced at all. Well, because of that I thought that there was evidence of vibration, that vibration had taken place there and gradually—
MR. LINDSEY: We object to that on the grounds that he is giving a conclusion without any basis or foundation for it.
WITNESS: You have to estimate some of these things.
MR. LINDSEY: But he is taking into consideration what he has been told about the vehicle, and we object.
THE COURT: Now his testimony should be confined to what he learned from the pieces themselves.
MR. ROBINSON:
Q. Now, that is what I am asking you, Dr. Cush-man, if from the examinations' of the wheel itself, did you draw these conclusions?
A. From that alone, I couldn’t, but I would say that there were suspicions that there was vibration. ’ ’

Dr. ¡Cushman stated definitely that the right rear axle was defectively manufactured and that the defect would cause a vibration that would be transmitted to the wheel. Due to objections by appellant’s counsel, Dr. Cushman was prevented from testifying as to what effect the defective axle and vibration would have on the wheel. The proffer of proof was that:

“If permitted by the Court to do so, Dr. Cushman would have further testified that the wobble caused by this defective axle could have caused and would have caused the eventual breakdown of the wheel, that it would have caused the rivets to fail and they would have failed progressively and the wheel would have broken down.”

The wheel introduced into evidence consisted of a rim and a spider. The spider (the part of the wheel that is bolted to the hub of the truck) was attached to the rim at four points by the use of three rivets at each point. As introduced the spider was broken loose from the rim at three of the four points. Opposite the point remaining intact, the outside of the rim was crimped or bent toward the inside of the vehicle as if it- had received a horizontal impact in that direction.

Thus it is seen that from the record there is no direct evidence of any manufacturing defect in the wheel, nor is there evidence to show that the defective axle was the proximate cause or could have been the proximate cause of the wheel's collapse.

It is well settled in the law that before a party can be held liable in damages for a wrong, the person claiming the damages must show that the wrong was the proximate cause of the damages suffered. Garner v. Missouri Pac. Railroad Co., Thompson, Trustee, 210 Ark. 214, 195 S. W. 2d 39 (1946).

Appellee argues, however, that if a wheel that is not defective will not collapse when the vehicle is being driven under normal conditions, a fortiori, a wheel that does collapse must be, in some respect, defective. This is, in effect, an attempt to apply the res ipsa loquitur doctrine. That doctrine is not applicable. Ford Motor Co. v. Fish, 232 Ark. 270, 335 S. W. 2d 713 (1960). This is a much different situation than that involved in Vandermark v. Ford Motor Co., 37 Cal. Rptr. 896, 391 P. 2d 168 (1964), upon which appellee relies, for there the alleged defective brake mechanism was destroyed in the accident. Furthermore, Judge Traynor there pointed out facts showing that the brake mechanism at the time of the injury was in the same condition as when it left the factory. Here we have a wheel used from December of 1962 to March of 1964 with some 16,000 miles of use, and the record is devoid of any proof relative to the use of the vehicle which might affect the condition of the wheel. Under such circumstances, it is almost imperative that expert testimony be used to show that a defect in the wheel was a manufacturing defect.

Therefore, we hold that there was insufficient evidence to show any manufacturing defect in the wheel or that the defect in the axle was a proximate cause of the collapse of the wheel. This of course calls for a reversal of this case; but since the reversal is for a lack of proof of causation, a matter which may be supplied by expert testimony, we are remanding same for a new trial. Continental Geophysical Co. v. Adair, 243 Ark. 589, 420 S. W. 2d 836 (1967).

In view of the possibility of a new trial, we point out that the issues with respect to waiver or estoppel as to any breach of warranty are, under the facts in this case, issues that were properly submitted to the jury. It is certainly not a question of law on review, for one seldom waives or is estopped with respect to a defect of which he had no knowledge. Furthermore, we think that whether the accident resulted from subsequent actions and omissions and intervening causes was also a fact question.

The issues between Ford Motor Company and Burn-ham-Ray Company have to do with the warranty which provides:

“Ford Motor Company has warranted to the Dealer who, pursuant to his sales agreement with the Company, hereby, on his own behalf, warrants to the owner each part of this Ford vehicle to he free under normal use and service from defects in material and workmanship for a period of 24 months from the date of delivery to the original retail purchaser or until it has been driven 24,000 miles, whichever comes first. This warranty shall be fulfilled by the Dealer t(or if the owner of the vehicle is traveling or has become a resident of a different locality by any authorized Ford dealer) replacing or repairing at his place of business, free of charge including related labor, any such defective part.
“This warranty is expressly in lieu of any other express or implied warranty, including any implied warranty of merchantability or fitness, and of any other obligation on the part of the Dealer.”

The waiver of the implied warranty of merchantability or fitness certainly does not protect Burnham-Ray from liability, for to do so would be unconscionable under the Uniform Commercial Code within the meaning of Ark. Stat. Ann. § 85-2-719 (3) (Add. 1961), which provides:

“ (3) Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable. Limitation of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation of damages where the loss is commercial is not.”

As between Ford and .Bumham-Ray, however, Ford takes the position that the phrase ‘ ‘ consumer goods, ’ ’ as used in the above statute, must take the definition given to consumer goods in the U. C. C., Ark. Stat. Ann. § 85-9-109(1), (4) (Add. 1961), which provides:

“Goods are
(1) “consumer goods” if they are used or bought for use primarily for personal, family or household purposes;
# * *
(4) “inventory” if they are held by a person who holds them for sale or lease or to be furnished under contracts of service or if he has so furnished them, or if they are raw materials, work in process or materials used or consumed in a business. Inventory of a person is not to be classified as his equipment. ’ ’

Since § 85-9-109(1) also contains a definition for inventory, Ford argues that as between it and the dealer the automobile was inventory with the dealer and that the unconscionable clause does not apply. We do not agree, for as we read § 85-2-719(3), the first sentence— i. e., “ Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable” —is not limited by the second sentence to consumers.

The composition and assembly of the modern automobile is such that as between a manufacturer and a dealer there is relatively little difference between the position of the dealer to the manufacturer as to consequential damages for latent defects and the position of the ordinary purchaser to the dealer. As to whether a waiver of the implied warranty of merchantability or fitness is unconscionable, a fact question is presented where it is shown that the defect is latent and such that the automobile dealer is not charged with notice or knowledge of the defect and with notice or knowledge that it could result in consequential injuries or damages. Nothing could be more unconscionable than to hold the dealer, a mere conduit between the manufacturer and the ultimate consumer, liable for consequential damages on breach of an implied warranty for a fault or defect caused by the automobile manufacturer of which the dealer had no notice or knowledge. The defect, as shown by the record here, was obviously one which a reasonable inspection would not have disclosed, and under the circumstances we hold that the uneonscionability of the exclusion of the implied warranty between the dealer and Ford was a fact issue.

Reversed and remanded.

FoglemaN, J., concurs.

John A. Fogleman, Justice,

concurring. I concur

in the remand of this case because I consider that the offer of proof by the witness Cushman to have been improperly excluded and that it would have made a jury question. I take the position that if Cushman had testified in the exact words of the offer of proof, reasonable minds might well have drawn an inference that the rivets, or some of them, failed gradually rather than serially, until one or more became so weak that the wheel broke down suddenly.


author: Conley Byrd, Justice.

text:
    Carl W. WIDMER v. Roy G. WOOD and Helen L. Wood
    5-4548
    427 S. W. 2d 537
    Opinion delivered May 13, 1968

      Carl W. Widmer, pro se.

      Hardin, Barton, Hardin & Jesson, for appellees.
   Conley Byrd, Justice.

Appellant Oarl W. Widmer appeals from a decree sustaining a plea of res judicata to his action for specific performance. His grounds for reversal are that the trial court erred in not holding all his requested admissions of fact as being admitted, in not granting his motion for summary judgment, and in sustaining the plea of res judicata. 'Since a plea of res judicata is in actuality a plea of confession and avoidance, we do not reach the first two points because we hold that the trial court was correct in entering a summary judgment upon the plea of res judicata.

Appellant’s complaint is based upon a sales agreement with appellees Roy G. Wood and Helen L. Wood, under date of October 19, 1961, for the sale of lands located in Sequoyah County, Oklahoma. After appellant had filed requests for admissions of fact and motions for summary judgment, appellees filed a motion for summary judgment specifically pleading as a defense a judgment entered in the Sebastian Circuit Court on May 12, 1967, between the same parties. Attached to appel-lees’ motion for summary judgment was the circuit court judgment which contained detailed findings of fact and a detailed statement of the issues between the parties. The circuit court judgment was the result of a suit brought by Roy G. Wood against Carl W. Widmer to recover the abstract to the real estate involved. It showed that as a defense to the recovery of the abstract Carl W. Widmer pleaded the same breach of the sales agreement upon which he here relies. The trial court there specifically found the issues relative to the sales agreement in favor of Roy G. Wood. The motion for summary judgment was filed on July 18, 1967, and the record shows no response by appellant Widmer to this motion. The order granting the summary judgment on the plea of res judicata was entered September 1,1967, more than 30 days after the filing of the motion for summary judgment.

“In Mid-South Ins. Co. v. lsi Nat. Bk., Ft. Smith, 241 Ark. 935, 410 S. W. 2d 873 (1967), we held that the motion for summary judgment requires the opposition to remove the shielding cloak of formal allegations and to demonstrate a genuine issue as to a material fact. Under the circumstances we think the plea of res judi-cata was well taken and that the trial court was correct in awarding the summary judgment. Nor can we find anything in Southern Farmers Ass’n v. Wyatt, 234 Ark. 649, 353 S. W. 2d 531 (1962), that would require us to arrive at a different conclusion.

Affirmed.


author: Carleton Harris, Chief Justice.

text:
    YARNELL ICE CREAM CO., INC. v. J. A. WILLIAMSON, et ux
    5-4399
    428 S. W. 2d 86
    Opinion delivered May 21, 1968

      Barrett, Wheatley, Smith & Deacon, for appellant. Pickens, Pickens & Boyce, for appellees.
   Carleton Harris, Chief Justice.

This is an appeal from an order of the Jackson County Circuit Court, setting aside a judgment in favor of Yarnell Ice Cream Company, appellant herein, and granting a new trial. J. A. Williamson and Mary Frances Williamson, appel-lees herein, instituted suit against appellant, alleging severe personal injuries to Mrs. Williamson and property damage loss to Mr. Williamson, as the result of a collision which occurred in the city of Newport on April 4, 1963. On that date, Mary Frances Williamson was a passenger in the automobile owned by her husband, 1. A. Williamson, and driven by appellees’ daughter, Sharon Pugh. The Williamson vehicle stopped for a red traffic light at the intersection of Malcolm and Pecan Streets, and was struck from the rear by appellant’s truck, which was being driven by an employee, Robert Davis. According to the evidence, the Williamson car was knocked 119 feet, and the truck, which continued on after the collision, came to rest 180 feet west of the intersection. The defense offered by appellant at the trial was that the brakes on the truck had failed, and Davis was accordingly unable to stop the vehicle. Mr. Davis, 25 years of age, and employed by appellant for seven years, testified that lie had had no trouble at all with the brakes until just before the accident; that he had just gone through a green light, and as he approached the Williamson car, pressure was applied to the brakes, and they “collapsed.” The witness testified that he then pulled the emergency brake, and shifted the truck into third gear, but by that time, he had struck the rear of the Williamson automobile. The truck was carrying a load of 170 fifty-pound boxes of sweet cream. Davis testified that he endeavored to have the truck repaired before leaving Newport, and that he observed the cause of the failure of the brakes:

“Well, the brake line had rubbed on part of the truck on the under part and it had rubbed so thin that when I applied the brakes it burst the hose and all the fluid run out.”

Tlie driver testified that traffic was approaching from the opposite direction (though this was disputed by appellees’ witnesses), and when asked why he did not turn to the right and drive his car-up over a curb where a service station was located, replied, “Sir, after the brakes went out, I was busy trying to stop it.”

Gerald Holbrook, a barber, who operates a shop at the intersection of Malcolm and Pecan, heard the crash, and then looked around to observe what was happening; he testified that Davis appeared to be having difficulty getting the truck under control: “He was racing the gears, you know, like he was trying to get it in gear and it was bucking and jumping trying to slow down, you know, to get it stopped.” He said that the driver subsequently told him that “his brakes went out.”

Mr. J. T. Rocka of Searcy testified that he worked on this truck on December 12, 1962, and had fixed the brakes on that occasion. He added that the truck was kept in excellent condition at all times. The witness said that it is possible for the hydraulic brake system on a truck to become ineffective because of a ruptured brake lino without any prior warning of any defect, and that this is particularly true of a loaded truck.

Mr. James Turner of Kcnsett, also a mechanic, agreed with Mr. Rocka.

The jury returned a verdict for appellant, and when appellees filed a motion asserting that the verdict was against the preponderance of the evidence, the court set aside the jury verdict and granted a new trial. Appellant argues that in returning a verdict for the ice cream company, the jury unanimously agreed that Davis did not commit any act of negligence which caused or contributed to the collision. The company relies upon testimony of Davis, Holbrook, Rocka, and Turner, and also points out that the two investigating officers testified that Davis told them, after the accident, that his brakes had failed as be approached the stop light. Pat Babb, one of the officers, also testified, “In checking the truck, I found out that it had no brakes.”

It is asserted that the trial judge granted the motion because he misconstrued the case of Houston v. Adams, 239 Ark. 346, 389 S. W. 2d 872, and felt that that case compelled a setting aside of the verdict.

. We find no error. In numerous cases we have said 'that, where a judgment is set aside, the sole issue is whether the trial judge abused his discretion. In Bowman v. Gabel, 243 Ark. 728, 421 S. W. 2d 898, quoting Twist v. Mullinix, 126 Ark. 427, 190 S. W. 851 (this case quoting from Blackwood v. Eads, 98 Ark. 304, 135 S. W. 922), we said:

“ ‘ “ The witnesses give their testimony under the eye and within the hearing of the trial judge. His opportunities for passing upon the weight of the evidence are far superior to those of this court. Therefore his judgment in ordering a new trial will not be interfered with unless his discretion has been manifestly abused. J) # * # J
“ ‘ * * *Having presided at the trial, and having seen and heard the witnesses testify, they have had the same opportunities as the jury, and hence are vested with the authority to ascertain whether or not the jury’s verdict is in accordance with the preponderance of the evidence, and when they have found upon conflicting evidence that such verdict is, or is not, against the weight of the evidence, such finding will not be set aside unless it is manifest that the court abused its discretion, that is, acted improvidently, arbitrarily, or capriciously in making such finding.’ ”

Certainly, we cannot say that it is here evident that the court “manifestly abused” its discretion. At the outset, let it be stated that there is no allegation of any negligence on the part of the driver of the Williamson vehicle. The driver of this car, observing the law, had stopped at a red light, and was simply waiting for the light to change when struck by appellant’s truck. According to the evidence of Davis, the truck driver, he had been traveling approximately 20 to 25 miles per hour prior to striking the Williamson car. Under the undisputed evidence, this estimate of speed seems somewhat conservative, since the testimony reflected that the Williamson automobile (though stopped) was knocked 119 feet — over a third of the length of a football field. Not only that, but the truck, although Davis, according to his statement, was frantically pulling on the emergency brake, and shifting gears in the truck to try and stop it, traveled approximately 180 feet before being brought to a standstill. Mr. Babb testified that the “whole rear end” was torn out of the automobile. Certainly, a much greater speed is indicated than that testified to by appellant’s driver. There is also evidence that Davis could possibly have avoided this crash by turning his vehicle to the right, though it does appear that he might have struck a telephone pole had this been done.

Appellant states that the trial court interpreted our decision in Houston v. Adams, supra, to require every motor vehicle to be equipped with two separate braking-systems, each independent of the other, and each capable of stopping the vehicle in substantially the same distance, and appellant states that this is an erroneous interpretation. It is argued that Ark. Stat. Ann. § 75-724 (Supp. 1967) only requires that the hand brake he capable of stopping and holding the vehicle. The statute reads as follows i

“75-724. Brakes. — (A) Brake equipment required.
,(.1) Every motor vehicle, other than a motorcycle or motor-driven cycle, when operated upon a highway shall he equipped with brakes adequate to control the movement of and to stop and hold such vehicle, including two [2] separate means of applying the brakes, each of which means shall be effective to apply the brakes to at least two [2] wheels. If these two [2] separate means of applying the brakes are connected in any way, they shall be so constructed that failure of any one part of the operating mechanism shall not leave the motor vehicle without brakes on at least two [2] wheels.”

We agree that the statute does not require two separate braking systems, each capable of stopping the vehicle in substantially the same distance, nor did Houston v. Adams, supra, so hold. We did, however, in that case, hold that the hand brake must have stopping power, and the statute so requires. In the present case, there were circumstances (herein pointed out.) that the trial court could have found clearly indicated the truck was being operated at a much greater speed than stated by appellant’s driver, or the hand brake had practically no stopping power.

We find no abuse of discretion by the court in setting aside the verdict.

Affirmed.

       Appellant did not offer the brake line into evidence.

       During the trial, appellant endeavored to show through cross-examination that the automobile was not “knocked” 119 feet, but rather, was “pushed” 119 feet; however, the witnesses who were interrogated as to this point were unable to give a definite answer. The only positive testimony was that the car was knocked for that distance.

       Of course, Mrs. Williamson and her daughter both testified that, while they were stopped at the light, there was no traffic meeting them.

       This interpretation does not appear in either the order signed by the court, nor in its memorandum opinion, in which the court, ( in finding that the verdict was clearly against the preponderance of the evidence, merely cited Houston v. Adams.


text:
    James Paul DANIEL v. Patsy Marie DANIEL
    5-4561
    428 S. W. 2d 73
    Opinion delivered May 21, 1968

      Penix & Penix, for appellant.

      Marcus F. Fietz and Arthur L. Adams, for appellee.
   Carleton Harris, Chief Justice.

This is a child custody case. Appellant, James Paul Daniel, 22 years of age, is a member of the United States Air Force. He was married in 1962 to appellee, Patsy Marie Daniel, at a time when he was 17 years of age, and she was 16. When barely 18, appellant joined the Air Force, and has been in the service since that time. Two little girls were born to the marriage, Paula Marie, 4 years of age, and Pamela Sue, 2 years of age. In July, 1966, Daniel was sent to Vietnam, where he was stationed until the last of April, 1967. In December, 1966, according to the evidence, appellant ceased receiving mail from his wife, but after a month, he received a letter from her asking for a divorce. James was told by Patsy, according to his evidence, that she loved another man. Subsequently, appellant filed an action, seeking a divorce and custody of the children, but later withdrew the petition for divorce, and confined his suit to a prayer for custody of the little girls. His wife filed a counter-claim for divorce, custody of the children, and support and alimony. After hearing evidence, the court denied a divorce to ap-pellee, hut held that appellant had failed to show that his wife was unfit to have custody of the minor children, and such custody was awarded to Patsy. The court further directed that the sum of $125.00 per month be paid for child support. From the decree so entered, appellant brings this appeal. For reversal, it is first asserted that Mr. Daniel should have been awarded custody of the children, and it is also argued that the amount awarded for support was excessive.

After a close study of the record, we have reached the conclusion that the Chancellor’s findings should not be disturbed. Appellant testified that, when lie, by virtue of his military duties, had to leave his wife, a mobile home which had been purchased by the parties was left parked at her mother’s house, the monthly payments being $60.75 ... a 1962 Comet automobile was also left with her. He said that, after being in the service two months, he made an allotment, and after going to Vietnam, he sent her practically all of his money, except about $10 a month; that this, for some period of time, amounted to about $500.00 per month. The witness stated that, when he reenlisted in August, 1966, he received a bonus, and sent her $850.00, but that, despite receiving these amounts of money, the mobile home had been lost due to her failure to make payments. Appellant testified that, after returning home, he went to his wife’s apartment, knocked on the door, and a man, J. C. Foreman, came to the door; that the two little girls were standing in the apartment, calling the man “Daddy.” Daniel said that the door was slammed in his face, but, after his continual knocking, it was opened again, and the man said that he was a repairman. Appellant is presently stationed at the Larado Air Force Base, and he testified that he was applying^ for a transfer to the Blytheville Air Base; that, if the transfer is approved, he will he able to go to Cash, where he will live with his parents, after finishing his regular work day at Blytheville. He desires that the custody of the children be given to him, and he stated that his parents would keep the children. Daniel said that, despite all that had happened, he would still be willing to talk with his wife about a reconciliation.

Grover Gent testified that he was the employej of a man named J. C. Foreman (who had worked for him for two months), and that Patsy Marie Daniel would generally bring Foreman to work. He said that she reg-ulai’lv would pick Foreman up when he finished his work about 11:00 P.M. W. E. Cooksey, manager of an apartment house in Jonesboro, rented appellee an apartment, and he said that Mrs. Daniel informed him that she had a husband and two children, and that her husband worked at Berry’s truck shop.

A brother and brother-in-law of appellant testified that they had observed Patsy in the car with J. C. Foreman, appellee having her arms around Foreman. The brother-in-law stated that appellee was a messy housekeeper, and that the children were not taken care of: “Their clothes was dirty, their faces was dirty and their hair wasn’t combed, and dirty dishes setting around, setting on the floor.” His wife agreed with this testimony, and said that the children were not properly dressed in the winter. She also said that appellee spent all afternoon with a “preacher.” Appellant’s mother, 51 years of age, and father, 67 years of age, testified that they owned a farm near Cash, had plenty of room to keep the children, and would be glad to do so. Both testified that their daughter-in-law neglected the children.

Appellee testified that it had been necessary for her to work at various times after her marriage to appellant; that she worked at the sandwich department at the base, and worked at a drive-in as a-'car hop. According to her testimony, she turned all checks over to her husband, prior to his going overseas. The witness stated that the trailer was repossessed after she had gone to Little Rock to try and find work. According to Patsy, the couple had become heavily involved in debt, because of purchases made, including the automobile, and $800.00 worth of furniture. She said that most of the money was spent in paying debts, including payments to the bank for money which her husband had borrowed. She denied that she did not care for the children properly, denied that she had an affair with the minister heretofore referred to, and denied that she had had improper relations with Foreman. She said that her husband had accused her of being intimate with several men; that he mistreated the children, having whipped them with a leather belt. Patsy’s mother, Mrs. Simms Decker, during a period when her daughter was working, kept the children from the last of December, 1966, until Mav, 1967.

Counsel for appellant urges that we give this case a real de novo hearing, and suggests that, all too often, we rely upon the findings of the trial court, commenting that the Chancellor had the opportunity to observe the litigants, and that we will not reverse his findings unless they are clearly against the preponderance of the evidence. Counsel is correct in stating that we do rely, in large measure, upon the findings of the trial court, and we are convinced that this is the better practice; though it is repetitious, we do think that the trial court is in a better position to render fact findings than this court, and we have commented that this is particularly true in a child custody case. In Wilson v. Wilson, 228 Ark. 789, 310 S. W. 2d 500, we said:

“* * * The Chancellor saw and heard the witnesses, and all the parties to the litigation, and evidently saiv the child, as the testimony reflects she was present. We know of no type of case wherein the personal observations of the court mean more than in a child custody case. The trial judge had an opportunity that we do not have, i. e., to observe these litigants and determine from their manner, as well as their testimony, their apparent interest and affection, or lack of affection for the child.”

There can be no entirely satisfactory conclusion of a contested child custody case. We, of course, are prone to be sympathetic with the position of the appellant, who is serving his country, and has been in Vietnam, and it does appear that his wife has not spent her time grieving over his absence. However, it. is noticeable that there is no evidence of appellee drinking, carousing, or frequenting undesirable places. Likewise, there is no actual evidence of adultery between appellee and Foreman, though he seems to have had a close association with appellee; the Chancellor, we think stated it correctly, when he said:

“Gentlemen, it is just this simple. She had a complaint for a divorce on the grounds of general indignities on his part and she has utterly failed to show anything at all. Any claim of infidelity, she denies, but there is sufficient conduct to put a reasonable person on notice that she might be guilty of it. I will have to deny her divorce and I will give her custody of the children. There is no showing that she is not a fit and proper person to have custody of the children and that will be my decree.”

It will also be observed that the evidence was not entirely one-sided, though there is no testimony that would indicate that appellant was guilty of intimate relations with other women. At any rate, whatever our thoughts in the matter, the fact remains that this court lias, many times, said that children of tender years will not be taken from a mother solely because of her infidelity to the husband. Harris v. Gillihan, 226 Ark. 19, 287 S. W. 2d 569, and cases cited therein.

We have many times said ,(,in fact, so many that a citation of authority is unnecessary) that the paramount consideration in child custody cases must always be the welfare of the child. In taking this rule as the guiding star, we cannot say that the court was wrong in awarding custody of the little girls to their mother. Appellant’s mother is 51 years of age, and his father is 67, and appellant himself did not seem to feel that his mother was a proper person to have the custody of the children. This is evidenced by the fact that appellant Avrote a will just before he Avent to Vietnam providing that if anything happened to him and his wife, appel-lee’s mother Avas to haAe the care of the two children. He also admitted that he had, both by mail, and in talking to his Avife, stated that his mother was not the proper one to have custody of the two little girls, though he said that this was based on the fact that his wife “told me about some things that my parents done.” It might also be added that, though appellant states that if he or his parents be given custody of the children, he would apply for a transfer to the Blytheville base, there is no assurance that the transfer would be granted.

It is also argued that the award of $125.00 per month is excessive. Let it be remembered that this money is not being paid for the benefit of the wife, but rather the decree makes it plain that the amount is for child support. With living costs mounting each day, we are unable to agree Avith appellant that this amount is excessive. It also appears that $105.00 of this sum will be paid by an allotment from the government, that amount being provided for children. It thus appears that appellant will actually be called upon to pay only $20.00. Of course, under a change of circumstances, appellant can always move to modify the provisions of the decree.

Appellee’s counsel is allowed an additional fee of $100.00 for services in connection with this appeal.

Affirmed.

       Appellee gave notice of a- cross-appeal, but same has apparently been abandoned, since, in her brief, she urges that the decree should be affirmed.

       She was subsequently employed at Dobbs House in Little Rock.

       Appellant testified, “I may have lightly, but I didn’t beat them.”


author: George Rose Smith, Justice.

text:
    Imogene M. WILLIAMSON et al v. Claude CHILDERS, Adm’r et al
    5-4463
    428 S. W. 2d 85
    Opinion delivered May 21, 1968

      Osborne W. Garvin and Imogene M. Williamson, for appellants.

      Moncrief So Moncrief, George E. Pihe and Macom, Moorhead So Greene, for appelles.
   George Rose Smith, Justice.

W. C. Honeywell, Jr., whom we will call the Decedent, died intestate on March 1, 1964, survived by collateral heirs on both sides of his family. His administrator filed the present petition for a determination of heirship with respect to the Decedent’s three tracts of land in Arkansas county (which have since been converted by public sale into cash). This appeal and cross appeal are from the probate court’s determination that Tracts 1 and 2 were ancestral estates coming by the Decedent’s mother and that Tract 3 was a new acquisition.

There is no longer any substantial dispute about Tracts 1 and 2. The decedent, an only child, inherited those two tracts from his mother, who died intestate in 1960. The trial court was unquestionably right in holding those two tracts to have been maternally ancestral. On the maternal side the Decedent was survived by an uncle, who was his mother’s half brother, and by a number of cousins who were descendants of six deceased half brothers and half sisters of the Decedent’s mother. The trial court made a slight error in the division of the proceeds of sale of Tracts 1 and 2, but in the course of preparing their appellate briefs the several attorneys for the maternal heirs have reached agreement that a one-seventh interest goes to the surviving uncle and that the other six-sevenths interest is to be divided per stirpes among the surviving cousins. The cause will be remanded for the entry of a decree to that effect.

The maternal heirs question the trial court’s finding that Tract 3 was a new acquisition. The proof is meager. By stipulation the parties introduced an abstract of title which shows that on February 18, 1948, the Decedent’s mother conveyed Tract 3 to him by warrant}^ deed. The abstract pages contain a number of printed entries for the insertion of information about the instrument being abstracted. With respect to the deed now in question the abstractor typed the letters “OK” after the printed entry, Consideration. That same “OK” was used to describe the consideration for almost every deed in the chain of title. We are not snre ;just what it was intended to mean.

Upon the scant proof in the record we cannot say that the probate court’s decision is against the weight of the evidence. An administrator’s petition for a determination of heirship is similar to a bill of interpleader, in that the rival claimants are called upon to assert their claims. Here we think it fair to apply the rule that prevails in interpleader cases: Each claimant is regarded as a plaintiff and must establish his claim by a preponderance of the evidence. Connelly v. Thomas, 234 Ark. 1024, 356 S. W. 2d 430 (1962).

The maternal heirs did not meet that burden. For an estate to be ancestral there must have been no other consideration than that of blood. Martin v. Martin, 98 Ark. 93, 135 S. W. 348 (1911). The record contains no testimony about the transaction between the Decedent and his mother. Manifestly the most important available evidence was the exact recitation of the consideration in the deed. The abstract of title shows that the deed is of record, but the claimants failed to produce a certified copy. That deficiency in the proof is so significant that it tips the scales in favor of the trial court’s conclusion. In closing, we should add that we attach no importance to the fact that the abstract of title does not indicate that any revenue stamps were attached to the Decedent’s deed. It was evidently not the abstractor’s practice to mention such stamps, because there is no reference to them anywhere in the entire abstract, which includes many conveyances.

Affirmed in part and reversed in part.


text:
    B. Bryan LAREY, Commissioner of Revenues v. DUNGAN-ALLEN, INC.
    5-4565
    428 S. W. 2d 71
    Opinion delivered May 21, 1968

      Lyle Williams, L. Phillip McClendon, John F. Oaut-ney and Hugh L. Brown, for appellant.

      Smith, Williams, Friday & Bowen, for appellee.
   George Rose Smith, Justice.

The Arkansas Gross Receipts Tax, usually called the sales tax, is basically a 3 percent excise tax levied upon gross proceeds derived from sales of tangible personal property. The statute, however, also imposes the tax upon a number of transactions that might not otherwise be thought to fall within the scope of what was originally a retail sales tax. Here we are called upon to interpret that section of the act which levies the tax upon “ [pjrinting of all kinds, types and characters, including the service of overprinting, and photography of all kinds.” Ark. Stat. Ann. § 84-1903 (d) (Repl. 1960). Our task is that of construing the phrase, “photography of all kinds.”

Dungan-Allen, Inc., is a corporation engaged in commercial photography. During the sixteen-month period now in question the company’s gross receipts were $65,079.79. The company filed no gross receipts tax return and paid no gross receipts tax. The Commissioner of Revenues assessed the tax upon $44,170.08 of the company’s gross receipts, conceding that the rest of its revenue was exempt, as it involved out-of-state transactions, sales to national banks, and other nontaxable activity. Dungan-Allen followed the statutory procedure of paying the assessment under protest and bringing suit to recover the money. This appeal is from a decree directing a refund of the entire amount paid.

Dungan-Allen contends primarily that about 85 percent of its revenue is recompense for services not falling within the statutory phrase, “photography of all kinds.” Secondarily it insists that the assessment in its entirety is so discriminatory as to be unconstitutional. The chancellor sustained both contentions.

The first contention is the more important of the two. Upon that issue the facts are hardly in dispute. Rodney Dungan and Willie Allen, who conduct their business in corporate form, are skilled commercial photographers. Much of their work is done for advertising agencies, magazines, television, and large advertisers such as banks and insurance companies. Their business is decidedly different from that of a neighborhood photographer who devotes most of his time to making pictures of family groups, wedding receptions, high school graduating classes, and similar subjects.

Dungan and Allen, in the course of their business, frequently have long consultations with their patrons about matters such as advertising layouts, promotional planning, material for magazine publication, and other activities going beyond the mere taking and developing of pictures. An excerpt from Dungan’s testimony:

“We take pictures — the least of what we do. We spend a lot of time planning, deciding which way it would be better to do what, get props together, picking the right locations. There’s a thousand other things before the actual picture taking. Actually, that’s a minor point. Anybody can make a picture, and it’s the arranging and the doing what is necessary to make a photograph that has ... a meaning, that does what you want it to do.”

In billing customers Dungan-Allen stresses its services rather than its photographic prints. A $25 hourly charge is made for services, but the prints are furnished for $2 each — a sum too small to include any profit. Thus for a day’s work an advertising agency might be charged $200 for photographic services and $10 for five different pictures. In this litigation the taxpayer insists that the incidence of the gross receipts tax should be similarly divided between nontaxable revenue from professional services and taxable revenue from the taking of pictures.

"We do not so interpret the statute. Hardly any tangible article or commodity is priced solely on the basis of its constituent materials. Invested capital, education or technical training, professional skill, labor, and overhead expenses, or some combination of them, can be expected to contribute to the value and selling price of the finished product. A familiar example is the conversion of a pound of steel into watch springs worth a thousand times as much as the original metal.

A similar question was before us in Ferguson v. Cook, 215 Ark. 373, 220 S. W. 2d 808 (1949). There a monument dealer sought to deduct from the taxable selling price of his tombstones the labor cost necessary to make and install them. In holding that the entire selling price was subject to the tax we relied upon the language, which is still in the statute, forbidding any deduction from the selling price “on account of the cost of the property sold, labor service performed, interest paid, losses or any expenses whatsoever.” Ark. Stat. Ann. § 84-1902 (d). There we said: “This language appears to mean, and we so construe it, that where one sells an article in the preparation of which for sale he has expended labor, which adds to its value and was necessary to make it salable, he must pay the sales tax on the price received, without deduction for the value of the labor performed.”

So in the case at bar. Regardless of how Dungan-Allen bills its customers, what its patrons are buying and paying for are photographs. No doubt the photographers’ experience and skill are essential to their work, but it is plain enough that the company’s customers would not ordinarily pay for the exercise of that skill if it did not enhance the value of the end product. Counsel for the Commissioner conceded in oral argument that the tax should not apply in instances in which Dungan-Allen were paid for services only, such as consultations, without any photographs being involved. That concession is well taken, but the principle cannot be extended to the point of separating the sale of the photograph from the exercise of that skill “which adds to its value and was necessary to make it salable.” Ferguson v. Co oh, supra.

Secondly, the taxpayer asserts unconstitutional discrimination in the legislative or administrative failure to tax physicians for the making of x-rays or architects for the making of blue prints, which, it is said, also fall within the purview of “photography of all kinds.” We find no merit in that contention. Classification is permissible if the differences are reasonably related to the purpose of the law. Jacks v. State, 219 Ark. 392, 242 S. W. 2d 704 (1951). Dungan-Allen is paid to produce and sell photographs suiting the particular needs and demands of its customers. By contrast, a physician is engaged to diagnose and treat illnesses, not to produce and sell x-rays. An architect is employed to design and supervise the construction of buildings, not to produce and sell blue prints. The situations are so fundamentally different that no prohibited discrimination can be said to exist in the language of the statute or in its administration.

Reversed.