author: MiNoe. W. Millwee, Associate Justice.

text:
    Feazell v. Feazell.
    5-782
    284 S. W. 2d 117
    Opinion delivered November 28, 1955.

      Roy E. Danuser, for appellant.

      Nell Poioell Wright, for appellee.
   MiNoe. W. Millwee, Associate Justice.

This suit arose in January, 1955, when appellee caused a citation to be issued against appellant, her former husband, charging him with contempt of court for failing and refusing to comply with an order made on March 7, 1950, directing him to pay $50.00 monthly for the support of their son, who is now 9 years old. In response to the petition, appellant pleaded his inability to make certain payments because of his diminished income and consented that judgment be rendered against him for delinquent payments of approximately $110.00 then due. He also asked that the monthly payments be reduced to $10.00 until an increase in income enabled him to pay more. It was agreed that appellant should be required to pay monthly support payments of only $25.00 pending a hearing which was set for March 14, 1955.

The chancellor on exchange found appellant guilty of contempt of court and fixed his punishment at 30 days in jail but the sentence was suspended for six months to give him time to pay an arrearage of $152.00 for which judgment was rendered. The court denied any reduction in the amount of the monthly support payments and appellee was allowed an attorney’s fee of $50.00.

According to the pleadings and proof, the parties were married in 1941 and entered into a separation agreement in 1946 which gave custody of the child to appellee and provided that appellant pay appellee $50 monthly for the child’s support, “until the circumstances of the parties change to an extent warranting a change.” The payments were to be made in semi-monthly installments. The terms of this agreement were made a part of a decree rendered March 7, 1950, in appellee’s suit for separate maintenance of the child.

On March 18, 1950, appellee filed suit for divorce on the ground of general indignities in which she alleged that the right of custody and the amount of support money for the child had previously been fixed by order of the court. A divorce decree was granted in said suit on April 20, 1950. Separate petitions for contempt citations were filed by appellee on the dates of September 5, 1950, June 19, 1953, and August 25, 1954, prior to the filing of the instant petition on January 17, 1953. There were no hearings on any of these except the 1953 petition which resulted in the assessment of a ten-day suspended jail sentence.

In March, 1950, appellant was earning $265.00 monthly, after deduction of withholding taxes, as a core driller for Ozark Dam Constructors in building Bull Shoals Dam. In addition he received a disability allowance of $50 per month from the U. S. Government on account of shrapnel wounds suffered in World War II. On completion of the Bull Shoals work in 1951, appellant worked for U. S. Engineers for 15 months at approximately the same rate of pay. When his disability prevented him from continuing this work in the latter part of 1952, ho worked in Colorado for 2 months receiving $88.00 per week. On completion of the Colorado job he returned to Arkansas and started working with his uncle in the well drilling business in and around Mountain Home and was still so engaged at the time of the trial. He is an experienced driller and is paid 65 cents per foot on all wells he drills but the work is seasonal. During 1954, his net earnings from this work amounted to $784.00 and he received $147.00 from January 1, 1955, until the date of trial on March 14, 1955.

Appellant has remarried and his present wife earned $240.00 in 1954. They rent their home for $35.00 per month and own no property except a 1951 automobile which is mortgaged for $575.00 and is not being operated because of inability to pay personal taxes and a license to operate. Appellant sold his household furniture in J anuary, 1954, to pay the support money and part of the proceeds from the car mortgage were also used for that purpose. Appellant is in debt to his uncle for moneys borrowed to make support payments and owes other accounts which he is unable to pay, and groceries and other household expenses run from $75.00 to $90.00 per month.

According to the record of semi-monthly payments made by appellant since March, 1950, he was $65.00 in arrears for the year 1950 and overpaid by $50.00 in 1951. He was also in arrears' $35.00 in 1952 and $157.35 in 1953 but overpaid in the amount of $66.35 in 1954. Thus appellant actually paid more than $50.00 per month for the calendar year immediately prior to the filing of the instant petition despite the fact that his net income had been reduced from $315 monthly in 1950 to $120 in 1954. He stoutly denied any intentional or willful violation of the court’s order in failing to pay the overall arrearage of $91.00 accumulated by January 1,1955, and stated that his decreased income had rendered it impossible for him to do so, or to continue such payments at the rate of $50.00 per month. He denied that he had made any recent purchases of intoxicants or that he had stated that he would pay nothing for his son’s support unless he was made to do so, as appellee testified.

Appellee still owns the former home of the parties in Mountain Home hut she and her son live in a rented home in Springfield, Mo. She has never sought alimony from appellant, is unemployed and is supported by her mother. Although she stated that she was physically unable to work she could not remember when she had last seen a doctor and was evasive as to the amount of support received from her mother.

It is well settled by our cases that imprisonment of a divorced husband for a failure to pay alimony or support money is justified only on the ground of willful disobedience to the orders of the court. Harmon v. Harmon, 152 Ark. 129, 237 S. W. 1096; Hervey v. Hervey, 186 Ark. 179, 52 S. W. 2d 963. In the recent case of Griffith v. Griffith, 225 Ark. 487, 283 S. W. 2d 340, we held that inability to pay on the part of the defendant is always a complete defense against enforcing payment from him by imprisonment in a civil contempt proceeding. In our opinion a preponderance of the evidence shows that appellant’s failure to pay the arrearage here arose from his financial inability and that it was not in willful disobedience of the court’s orders.

We are also of the opinion that, from the date of trial, the monthly support payments should be modified and reduced to $25.00 per month until such time as appellant’s income will warrant a further change in the amount of such payments.

Appellant also contends that the court was without authority to allow a fee to appellee’s attorney. Appellant points to Ark. Stats., § 31-1210 [§ 1 of Act 271 of 1915] which, in amending Pope’s Digest, § 1388, failed to specifically authorize attorney fees in separate maintenance suits as did a previous amendment of the same statute by Act 25 of 1911. It is true that prior to the adoption of either amendment we held that a divorced wife who petitioned for a change in the custody of children after rendition of a final divorce decree was not entitled to attorney’s fees. Nelson v. Nelson, 146 Ark. 362, 225 S. W. 619. However, in that case, the wife was held to be a mere volunteer in supporting the children whose custody had been awarded to the husband. It was also held that the divorce decree was, in the peculiar circumstances, a final adjudication of his liability for her attorney’s fees.

In Tilley v. Tilley, 210 Ark. 850, 198 S. W. 2d 168, we held that the allowance of attorney’s fee to the wife in her separate suit for maintenance of herself and child was a matter within the sound discretion of the chancellor under § 31-1210, supra. Also, in Waller v. Waller, 220 Ark. 19, 235 S. W. 2d 814, we approved an allowance of an attorney’s fee to a divorced wife in her separate action for the support of the child of the parties in a habeas corpus proceeding. In contempt proceedings for failure to comply with an allowance for child support it is held generally to rest within the sound discretion of the trial court as to whether attorney fees of the injured party should be assessed against the defendant. 27 C. J. S., Divorce, § 325. Regardless of the effect of the amended statute, we think it is within the inherent jurisdiction of equity to allow an attorney’s fee in cases of this kind and that the court did not abuse its sound discretion in doing so. As a matter of practice we have repeatedly made such allowances in this court.

That part of the decree finding appellant guilty of contempt of court and refusing to modify the monthly support payments is accordingly reversed. In all other respects the decree is affirmed.


source: Caselaw Access Project

author: George Rose Smith, J.

license: Public Domain

text:
    Orr v. Bergemann.
    5-783
    284 S. W. 2d 105
    Opinion delivered November 28, 1955.

      James R. Male, for appellant.
   George Rose Smith, J.

This was originally a suit by Kelley Brothers Lumber Company to foreclose a materialman ’s lien upon the house and lot in dispute. There being no question as to the validity of that lien, the real controversy is between the appellant Orr and the appellees Harold and Anita Bergemann. Orr seeks to enforce an oral contract with both the Bergemanns and a written contract with Harold Bergemann only. The chancellor awarded Orr a money judgment upon the written contract but refused to grant any relief upon the oral agreement. Orr contends that he is entitled to specific performance of the parol contract.

In 1951 Orr, having retired from newspaper work in Kansas City, came with his wife to Arkansas in search of a place to live. Harold Bergemann, who is a son of Mrs. Orr by a prior marriage, was then living with his wife Anita near Fayetteville in a home owned by Mrs. Bergemann. The Orrs visited the Bergemanns, and it was agreed between the two couples that the Orrs would build a house next door to the Bergemanns on another part of Mrs. Bergemann’s land, that the Orrs wonld receive a life estate in this property, and that upon the death of Mr. and Mrs. Orr the house and lot would revert to Mrs. Bergemann.

Pursuant to this oral agreement Orr constructed a modern four-room house on Anita’s land. The Orrs, however, were unable to obtain from her the promised conveyance of a life estate; Mrs. Bergemann kept putting the matter off and finally resisted Orr’s present plea for specific performance. When the house Avas completed Orr still owed $663.95 to Kelley Brothers for materials used in the construction.

In April, 1953, Mrs. Orr became so seriously ill that her husband thought it best to take her back to Kansas City for treatment. Before he left Orr made a Avritten contract Avith Harold Bergemann by which Bergemann agreed to pay Orr $2,500, at the rate of $25 a month, for the labor and materials furnished by Orr in the construction of the house. Orr testified that Bergemann also agreed to pay the Kelley Brothers claim in monthly installments of $25. This testimony is undenied; Harold did not take the witness stand at the trial.

After the Orrs’ departure the Bergemanns moved into the new house and Avere still occupying it when the case was tried. Mrs. Orr died in December, 1953; this litigation was begun by Kelley Brothers the folloxving July. It is shown Avithout dispute that Harold Bergemann has paid nothing upon his debt to Orr, that nothing has been paid by anyone upon the Kelley Brothers claim, and that Anita Bergemann refuses either to execute a deed to Orr or to permit him to remove the house from her land. The chancellor’s decree granted foreclosure of the materialman’s lien, reformed Orr’s contract Avith Harold by inserting an acceleration clause that had been omitted by mistake, and awarded Orr a judgment against Harold for $2,500. Orr’s cross-complaint for specific peirformance of the oral agreement Avas dismissed for want of equity.

Upon trial de novo it is clear enough that the Orrs had a cause of action against Mrs. Bergemann for specific performance of the oral contract. The statute of frauds does not supply a defense, for the promisees’ possession and improvements took the agreement out of the statute. Dillard v. Kelley, 205 Ark. 848, 171 S. W. 2d 53.

It is equally clear that this cause of action was not extinguished by, or merged into, Orr’s written contract with Harold. Since the duty of specific performance rested only on Anita, who was the sole owner of the land, it would be necessary to find a novation in order to hold that Anita’s promise had been superseded by her husband’s subsequent obligation. It is essential to a novation, however, that there be a mutual agreement by which the new obligor is substituted for the old. Riddick v. White, 194 Ark. 1010, 110 S. W. 2d 9. Here Anita refused to join in the contract between her husband and Orr, and without her joinder it is evident that a novation was not intended. This is so because Orr’s agreement with Harold necessarily recognized that Orr had an interest in the property, which Orr undertook to sell for $2,500. Since Orr’s interest could only have been his cause of action against Anita for specific performance, the written contract was manifestly an affirmation of Anita’s obligation rather than a discharge thereof.

With respect to the account of Kelley Brothers, the preponderance of the evidence shows that primary liability for the debt has been assumed by the Bergemanns. Harold Bergemann, in purchasing Orr’s interest for $2,500 — a sum substantially smaller than Orr’s investment in the house — agreed to pay the Kelley Brothers claim. There is convincing proof that Anita Bergemann also assumed this obligation after Orr went to Kansas City. An officer of the lumber company states positively that Mrs. Bergemann came to the company’s office and assumed the debt, explaining that as a result of family difficulties the Bergemanns had taken over the property. According to this witness Mrs. Bergemann applied for a federal loan to pay the account. Mrs. Bergemann’s testimony is so contradictory within itself that it fails to overcome the adverse proof. Indeed, when it is observed (a) that Harold had already obligated himself to pay the account, (b) that the claim was a lien against the title that Anita was asserting, and (c) that the Bergemanns had moved into the house and were still occupying it rent-free when the case was tried some eighteen months later, there are good reasons for believing that the Bergemanns voluntarily accepted primary responsibility for the debt.

To summarize: The lumber company is entitled to judgment against Orr and the Bergemanns and to a first lien against the property. Orr is entitled to have a life estate vested in him by the decree (Ark. Stats. 1947, § 29-126), to have judgment against Harold Bergemann for the unpaid purchase price due under their contract, and to an equitable lien upon the life estate to secure the payment of his judgment against Harold. In foreclosing the liens the court should marshal the assets by making Mrs. Bergemann’s reversion primarily liable for the materialman’s lien. The proportionate value of the life estate and the reversion may be readily determined by offering those interests for sale separately, although the property should also be offered in gross so that the better bid may be accepted. The proceeds from the sale of the reversion will stand primarily liable for the lumber company’s judgment, with any surplus going to Mrs. Bergemann; the proceeds from the sale of the life estate, to the extent that they are not needed to complete payment of the Kelley Brothers judgment, will be applied in satisfaction of Orr’s judgment against Harold Bergemann, with any surplus going to Bergemann.

Beversed and remanded for further proceedings.


author: Paul Ward, Associate Justice.

text:
    Ark. Independent Oil Marketers Ass’n, Inc. v. Monsanto Chemical Co.
    5-784
    284 S. W. 2d 127
    Opinion delivered November 28, 1955.

      Tom Gentry, for appellant.

      Davis <£ Allen and H. D. Dickens, for appellee.
   Paul Ward, Associate Justice.

Appellant, Arkansas Independent Oil Marketers Association, Inc., instituted this action in the Sebastian Chancery Court, Fort Smith District, against the Lion Oil Company, seeking to enjoin said company from allegedly selling gasoline at tank wagon prices which are below the cost price of such gasoline. Summons was served on the Lion Oil Company by delivery of same to J. Aubrey Tates whose residence was in Sebastian County. Service was had on Yates on the assumption that Lion Oil Company maintained a place of business in Fort Smith and that Yates was in charge of this business as agent of the company, and that the service was proper under Ark. Stats., § 27-347.

Lion Oil Company filed a motion to quash the above described service of summons on the ground that Yates was not its agent. The trial court sustained said motion and the Association has appealed. Before submission of the cause in this court and on motion of the Lion Oil Company, the Monsanto Chemical Company was substituted as appellee.

Briefly stated, it is the contention of appellant that Yates is an agent of appellee, and it is the contention of appellee that Yates is an independent contractor, and therefore not a proper person for service under the above mentioned statute.

In order to intelligently discuss the issue here presented it is necessary to set out in somewhat detail the terms of the written contract existing between the Lion Oil Company and Yates, and also the testimony introduced at the hearing on the motion. Hereafter when we use the term “appellee” it will include the Lion Oil Company.

Appellee manufactures gasoline and allied products in El Dorado, Arkansas, and distributes the same in the Fort Smith area through a warehouse or bulk station operated by Yates. The products are received by Yates on consignment, with the title remaining in appellee. The gasoline is stored in six large tanks and the other products in a warehouse, all located on a parcel of land in Fort Smith, and all of which are owned by appellee. Among other things the “Distributor’s Contract” provides: (5) The distributor [Yates] shall maintain records of all products received at the bulk plant and thereafter sold by him, and shall at the request of appellee furnish detailed reports concerning receipts, sales and inventories; (6) The distributor shall sell said products only at prices fixed by appellee from time to time; all sales shall be for cash but distributor may make authorized credit sales in the name of appellee, and; the distributor shall immediately remit to appellee the full proceeds of all sales; (7) The distributor shall be paid a commission on all sales as per the schedule therein set forth; (8) The distributor shall furnish at his expense all trucks, tanks and other equipment necessary for selling and delivering said products, and shall employ at his expense all persons who may be required to assist him; (9) The distributor shall maintain at the bulk plant a telephone listed in the name of appellee, and he shall at his expense, when requested (but at least once a year), paint all motor vhicles used in distributing said products, the paint to be furnished by appellee; (13) Appellee has the right to make a complete audit of the distributor’s inventories, records and accounts from time to time without notice, and; (15) The agreement shall continue at the will of the parties and either party may cancel at any time without notice. There are some other provisions in the contract which we shall note later.

Testimony introduced by appellee to sustain its motion in the trial court shows that on occasions Yates receives gasoline pumped from Oklahoma to a station near Fort Smith, places the same in storage tanks and receipts for it in the name of appellee; that he collects for all gasoline and all products sold and places the money in a local bank in appellee’s name; that he looks after appellee’s warehouse located on the same plot of ground with the tanks, and; that he makes reports of all sales and inventories on blanks furnished by appellee.

Appellant relies most strongly on the case of Arkansas Power and Light Company v. Hoover, 182 Ark. 1065, 34 S. W. 2d 464, quoting therefrom the following:

“In the instant case the agent was entrusted with the money collected, his duty being to receive and receipt for it, and transmit it to the company, a business as important, if not more so, than any other business it had in the county, and if he were competent to conduct such a business, he could be depended upon to notify the corporation of service upon him. The important thing in determining this question is that the corporation itself established a place of business where its bills could be paid and receipted for, and when a corporation establishes such a place and receipts for money paid for its service through an agent, it has for all reasonable and practical purposes established such a place of business as mentioned in the statute.”

The pertinent facts in that case were these: L. A. Atkins was the manager of a drug store at Waterloo, Arkansas, in which store the Power Company had no interest and paid no rent. Atkins merely collected and receipted for light bills as people would come in the store to pay him, and none of his duties required Mm to go outside the store. As the bills were collected Atldns transmitted the money to the Power Company. The bills which Atkins collected were made out by the Power Company and by it mailed to him, and for his services he was paid a flat salary of $10 per month. Appellee considers this case inapplicable to the situation here principally because, it says, “the customers involved were customers of Arkansas Power and Light Company and not his customers.”

Appellee for an affirmance of this case relies principally, if not entirely, upon the proposition that the testimony and the contract in this case show that Tates was an independent contractor as that term is defined in the case of Moore and Chicago Mill & Lumber Company v. Phillips, 197 Ark. 131, 120 S. W. 2d 722, quoting the last paragraph on page 137 of the Arkansas Reports. We agree that this decision gives a correct and lucid enunciation of the elements creating an independent contractor. We must also agree that there are many indications disclosed by the testimony and contained in the contract that Yates occupies the relationship to appellee of an independent contractor. There are, however, certain other incidents of relationship disclosed by the contract and testimony which force us to the conclusion that Yates was, at least in some respects, an agent of appellee. This conclusion is sustained by the weight of the authorities which we have been able to examine.

Before proceeding further, however, we desire to point out three things that should be kept in mind in resolving the issue here presented: (a) In considering the written contract between Yates and appellee we must be guided by what control appellee was empowered to exercise over Yates rather than what power it actually did exercise. See 19 A. L. R. 20 and Magnolia Petroleum Company v. Johnson, 149 Ark. 553, 233 S. W. 680; (b) It is of no significance that Yates was paid a commission in this case rather than a salary as was the case of Atkins in the Hoover case, supra. See 116 A. L. R. 459, and; (c) We know of no logical or legal reason why Yates might not be an independent contractor in certain respects and at the same time, in other respects, be an agent of appellee. See City of Detroit v. Corey, 9 Mich. 165, 80 Am. Dec. 78, and 19 A. L. R. 270, § 20.

As heretofore stated we think there are portions of the testimony and parts of the contract which strongly indicate that Yates was, in some respects, acting as an agent for appellee. It is not denied that Yates collected the money for all products sold and placed the same in a Fort Smith hank in the name of appellee, and Yates stated that he had no authority to check on the account. Appellee owned a warehouse located on the same ground as the bulk station in which, among other things, were stored tires, tubes, oil and case oil. After making this statement Yates was asked: “Q. Now, that property that is in the warehouse that belongs to Lion Oil — you have charge of the custody of that, don’t you? A. Yes, sir. Q. It’s up to you to look after it and see that nobody steals it 1 A. That’s right.” And again “Q. And you are charged by Lion Oil Company with looking after their property? A. Yes, sir.” It appears that not all of the gasoline sold by Yates at the bulk station in Fort Smith is shipped to him from appellee’s refinery in El Dorado. On occasions gasoline is piped from Oklahoma to a station near Fort Smith and then put in the storage tanks at the bulk station. On these occasions the gasoline is received and receipted for in the name of appellee.

There are portions of the contract itself which seem to us to indicate that appellee retained and could have exercised to some extent control over Yates. Subsection (B) provides that Yates may, at the request of appellee, secure and store products from a neighboring Lion Distributor and receive additional commission therefor. Section (10) provides that Yates shall receive and store certain equipment from appellee to be loaned by appellee to persons to whom Yates made sales, and that Yates would comply with the policy of appellee in effect from time to time with respect to handling drums. Section (11) provides that Yates will, at the request of Lion, move equipment from one station in his territory to another in event appellee desires that to be done, and for such service appellee will reimburse Yates his costs in handling. Likewise appellee has the right to direct Yates to move equipment from a location in Ms territory and transport it to his bulk plant for storage, appellee paying expenses. Section (12) provides for Yates to inspect tank ears shipped to his plant to ascertain if they are ‘ ‘ filled to within 3 inches of the top of the shell, ’ ’ and if not Yates is to notify appellee’s division manager. It is* further provided that the cars shall not be unloaded until ordered by the division manager. Section (17) gives appellee the right, in certain circumstances, to insist upon “strict, full and punctual performance of distributor’s obligations hereunder.”

Without laying particular stress on any one of the items mentioned above to show the relationship of agency, it is our opinion that all of them together, including the entire contract and the testimony, show conclusively that such a relationship does exist between appellee and Yates. This view conforms with the statement in 116 A. L. R. at page 462 and 463 where this question is discussed under the heading “Tank Wagon or Wholesale Station.” In referring to numerous cases dealing with this question it is there stated:

“. . . and in the majority of such cases it has been held that such operator is a ‘servant’ or ‘employee’ of the oil company, rather than an ‘independent contractor’ as is commonly contended by the company, generally on the theory that although the terms of the written contract might indicate that the operator had the status of an ‘independent contractor,’ the company in actual practice retained such power to subject him and Ms employees to its will and direction that he was in fact a ‘servant,’ ‘employee,’ or ‘agent,’ . . .”

Numerous cases are then cited to support that statement. In point also is the case of McDaniel v. Gulf Oil Corporation, 204 S. C. 186, 28 S. E. 2d 815.

The case of Magnolia Petroleum Company v. Johnson, supra, in dealing with this same question, had a factual situation very similar to the one here, as shown by reference to page 555 of the Arkansas Reports. In that ease there was a jury trial and the Petroleum Company insisted that the undisputed evidence showed the relationship of an independent contractor. In affirming the case the court said:

“And the majority are of the opinion that the contract between the company and Smith, as interpreted by the conduct of the parties under it, shows that it was tjie purpose of the company to retain complete control of everything done in connection with the sale and delivery of the oil, and that the testimony, in its entirety, warranted the finding that the drivers of the wagon were themselves the servants of the company.”

It follows from what we have said that the decree of the trial court should be and it is hereby reversed, with directions to overrule appellee’s motion to quash service.


author: Sam Robinson, Associate Justice.

text:
    Cooper v. Cooper.
    5-778
    284 S. W. 2d 617
    Opinion delivered November 28, 1955.

      Henry B. Whitley and Wendell Utley, for appellant.

      A. A. Thomason, for appellee.
   Sam Robinson, Associate Justice.

The principal issues here are the validity of a divorce granted by a court in the State of Nevada, and the wife’s interest in funds received on a fire insurance policy for the loss of a house owned as an estate by the entirety. Appellant and appellee were married on August 29, 1950, in Columbia County, Arkansas, where they had lived all their lives. A son was born in January, 1952. On May 21, 1951, they purchased two acres of land as an estate by the entirety and built a house on the property. The house was insured for $2,500.00 against fire; later it burned and the loss was settled for $2,250.00 which was paid to appellant, J. W. Cooper. The parties also purchased an automobile on which appellee, Dorothy Cooper, paid $30.00 a month for several months.

On April 10,1952, appellant, J. W. Cooper, filed suit for divorce in the Columbia Chancery Court. Dorothy appeared in the case and the plaintiff took a nonsuit on June 29, 1952. A few days later, on July 2, he filed a suit for divorce in the Pulaski Chancery Court and after Dorothy appeared in that case he again took a nonsuit. On August 18, 1952, he again filed a divorce suit in the Columbia Chancery Court and, after Dorothy appeared, he took his third nonsuit on January 26, 1953. A short time later, he departed for the State of Nevada where it appears that he again filed suit for divorce. Dorothy was not notified, and he obtained a decree of divorce on March 26,1953. Two days after this divorce ivas granted he returned to Arkansas and immediately married another person.

Appellee, Dorothy Cooper, then filed this suit in which she alleges that she is the wife of appellant and asks for maintenance for herself and support for the child. She further asks that appellant be required to account to her for one-half of the proceeds from the insurance policy, and that he also be required to account to her as to her interest in the automobile. Cooper answered, alleging that he had been granted a valid divorce in the State of Nevada. Dorothy replied, denying the validity of the Nevada divorce and stating that it was invalid because proper service was not obtained and further alleging that the Nevada court did not have jurisdiction to grant a divorce because the plaintiff, Cooper, was not domiciled there.

The Chancellor made a finding that the Nevada court was without jurisdiction to grant a divorce to Cooper, and ordered appellant to pay $12.50 a week for support of his child. The court also rendered a judgment against appellant for one-half of the proceeds of the insurance policy and for the amount that Dorothy had paid on the car, making a total of $1,432.46.

If Cooper did not have a bona fide domicile in Nevada, a court of that State had no jurisdiction to grant a valid divorce. And, the jurisdiction of the Nevada court may be impeached in a court of Arkansas. Williams, et al. v. North Carolina, 325 U. S. 226, 89 L. Ed. 1577, 65 S. Ct. 1092, 157 A. L. R. 1366; Esenwein v. Commonwealth ex rel. Esenwein, 325 U. S. 279, 65 S. Ct. 1118, 89 L. Ed. 1608. But, if the defendant appears in the cause and thus has an opportunity to contest the issue of domicile, the decision of the court of the State where the trial is held is controlling. Sherrer v. Sherrer, 334 U. S. 343, 92 L. Ed. 1429, 68 S. Ct. 1087, 1 A. L. R. 2d 1355; Anderson v. Anderson, 223 Ark. 571, 267 S. W. 2d 316. Here, Mrs. Cooper had no knowledge of the pendency of the suit in Nevada and of course did not appear therein.

The evidence that Cooper did not have a bona fide domicile in the State of Nevada is overwhelming. It is clear that he went to that State merely to get a divorce and not to establish a domicile there. He intended to stay there just long enough to meet the technical residential requirements of the divorce laws of Nevada. In the first place, he filed three suits in the State of Arkansas within a comparatively short time before leaving for Nevada. He was teaching school in this State and had another person to substitute for him until his return, which he stated would be in about six weeks. (Nevada requires a six weeks’ residence in divorce cases.) Two days after the decree of divorce was rendered in Nevada, he came back to Arkansas, immediately married another person and returned to his old job as teacher. In these circumstances, it is hard to see how it could be seriously contended that Cooper ever had a bona fide domicile in Nevada.

Next is the question of the ownership of the proceeds of a policy of fire insurance. The house owned by the parties was destroyed by fire and Cooper collected and kept the insurance money. He had taken out the policy of insurance in his own name, but in doing so he was acting as agent for his wife as well as for himself.

The husband is not an agent for the wife solely by reason of the marital relationship. ‘ ‘ But slight evidence of actual authority is sufficient proof of the agency of the husband for the wife in matters of domestic nature. ’ ’ 41 C. J. S. 549. Agency may be established by circumstantial evidence. Williams v. O’Dwyer & Ahern Company, 127 Ark. 530, 192 S. W. 899; Sidle v. Kaufman, 345 Pa. 549, 29 A. 2d 77. In the Sidle case, the court said: “ ‘The relationship of agency cannot be inferred from mere relationship or family ties unattended by conditions, acts, or conduct clearly implying an agency’ . . .; but such relation is competent evidence when considered with other circumstances as tending to establish the facts of agency and where there has been other competent evidence tending to the same end.” And, it is said in Restatement of Agency, § 22: “Neither husband nor wife by virtue of the relationship has power to act as agent for the other. The relationship is of such a nature, however, that circumstances which in the case of strangers would not indicate the creation of authority or apparent authority may indicate it in the case of husband or wife.” In the case at bar, the husband secured a policy of fire insurance in Ms name only on property which is an estate by the entirety. In these circumstances, the fact that the husband was acting as agent for his wife in addition to acting for himself is established if any reasonable inference to be deduced from the evidence leads to that conclusion.

In the case at bar, the circumstantial evidence proves that at the time Cooper obtained the policy of insurance not only was he acting for himself but he was also acting as an agent for his wife. At the trial, instead of standing-on the proposition that the policy of insurance was personal as between him and the insurance company and that his wife had no interest in the proceeds of the policy, he undertook to justify his failure to divide the insurance money with his wife on the ground that he had used the money to pay debts owed by both of them. But it appears that of the debts he claims to have paid, his wife Avas liable only on one $200.00 note. His attempt to explain his conduct in failing to divide the money with his wife on the ground that her part was used in the payment of her debts is somewhat of an admission that she Avas entitled to part of the proceeds from the fire insurance policy.

As evidence of the fact that Cooper Avas acting as agent for his Avife, she testified that she knew he had taken out the fire insurance policy, but she did not know that he had taken it out in his name only. She Avas present in the insurance company office, along Avith Cooper, when the settlement Avas agreed on, but she was not present when the check Avas delivered to him. In fact, she did not know that he had received the check. She testified: “And I asked him several times about the check and he said they hadn’t paid it off because they said they had to do some more checking before they could pay it.” She further testified on cross-examination: “Q: You knew it was settled in November? A: I didn’t know it was settled in November. Q: You said a while ago it Avas in November? A: Sometime later I went to the insurance office to find out about the check. I found out that it Avas paid in November. Q: When were you in Mr. Lindsey’s [the insurance agent’s] office? A: It was — I don’t know actually when it was. It was in April. Q: You mean to say he didn’t get the check until April? A: I don’t know when he got it. I still don’t know. Q: You say you were in the insurance office in April? A: That’s right. Q:Is that when the discussion was about the check? A: That’s when I inquired about the insurance check. ’ ’

Cooper testified that the insurance company paid him $2,750.00. (This figure included $500.00 for personal property.) He further said: “I told her, I says, 'Well, I have the money now; I might as well get started paying on bills; we won’t have any money, as I want to pay the bills.’ And that’s what I did.” On direct examination he was asked this question: “How much did you pay out of that on indebtedness you and Dorothy already owed? ’ ’ Cooper then testified as to a long list of items which he claims that both owed and which he paid from the insurance money. He also said that he paid an old account of Dorothy’s on which he personally was not liable at all. From the above testimony, it can be inferred that Cooper was acting as agent for his wife when he secured the policy of fire insurance.

The house that was destroyed by fire, and on which Cooper collected and kept the insurance money, was part of an estate by the entirety. It is said in 26 Am. Jur. 702: “In jurisdictions which recognize a tenancy by entirety in personal property, there is no question that an estate by the entireties exists in the proceeds or derivatives of real property held by entirety.” Undoubtedly in this State an estate by the entirety can exist in personal property. Chicago, Rock Island & Pacific Railroad Company v. Reeves, 217 Ark. 33, 231 S. W. 2d 103. The question of ownership of personal property as an estate by the entirety is thoroughly discussed in Union & Mercantile Trust Company v. Hudson, 147 Ark. 7, 227 S. W. 1. There it was held that where a man and wife owning realty as tenants by the entireties mortgaged it, and where the husband deposited the proceeds in his own name without his wife’s knowledge, the nature of the wife’s interest in the deposit is the same as her interest in the real property from which the monies on deposit were derived; that according to the great weight of authority tenancies by the entireties exist in all kinds of personal estates. It was further held in the Hudson case that the husband and the bank where the proceeds of the mortgage were deposited held the funds as trustees of Mrs. Hudson’s interest.

In the case at bar the evidence is convincing that Mrs. Cooper did not know that her husband had collected the insurance money, although there is some evidence to the contrary. Cooper held his wife’s interest in the funds as trustee, and the court correctly found that he was indebted to Mrs. Cooper for one-half of the amount of the insurance he had collected on the house, plus Mrs. Cooper’s interest in the automobile.

If there was a misjoinder of causes of action, it was waived by the appellant in failing to file a motion to strike out of the complaint any causes of action improperly joined. Ark. Stats., §§ 27-1302, 27-1303.

The decree is affirmed.


author: Lee Seamster, Chief Justice.

text:
    Johnson v. Johnson.
    5-791
    284 S. W. 2d 846
    Opinion delivered December 5, 1955.
    [Rehearing denied January 9, 1956.]

      G. W. Loohadoo, for appellant.

      McMillan $ McMillan, for appellee.
   Lee Seamster, Chief Justice.

During the pendency of a divorce action by appellant, Holman Johnson, against appellee, Aline Johnson, the appellee petitioned the Clark Chancery Court for temporary attorney fees, costs, custody of the couples nineteen-month-old daughter, Ruby Jene, and, the sum of $25 per month for the support of said child. On November 2, 1953, the chancellor issued an order awarding temporary custody of the child to appellee and directed the appellant to pay $25 per month for the support of said minor child.

On December 8, 1954, a final decree was rendered granting appellant a divorce and awarding custody of the minor child to the appellee. The decree ordered and directed the appellant to pay $25 per month to the appellee for the support of the minor child.

A petition was filed by appellee in January of 1955, for the purpose of citing appellant into court for failure to pay maintenance and support as directed by the decree. The court granted this petition on January 10, 1955, and the appellant was ordered cited to appear before the court on February 14, 1955. On this date a hearing was held and the chancellor found that appellant was in arrears for two monthly payments (January and February of 1955), and ordered the appellant to pay the appellee the sum of $50. On Febiuuny 24, 1955, the appellant filed a motion to vacate and modify the judgment and decree. The court, after hearing the additional testimony, overruled the appellants’ motion on April 4, 1955. This appeal follows.

The appellant contends that he has made all payments that are due the appellee. He admits that no payments were made direct to the appellee, but earnestly insists that all payments were delivered to the office of his attorney, to deliver to the attorney for the appellee. The appellant testified that he could account for sixteen payments that he had delivered to the office of his attorney. The attorney for the appellant admitted that his office had received all sixteen payments and insisted that his secretary, in turn, delivered these payments to the attorney for the appellee. The secretary- testified that she did not recall any specific payments in which she did not procure a receipt at the time of delivery. The record reveals that there should have been sixteen payments to appellee, but appellant was able to establish only fourteen receipts from the attorney for the appellee.

The trial court did not attempt to blame anyone for. the failure to deliver these two payments, but merely said ‘ ‘ This boils down to a bookkeeping transaction. This money passed through several hands and through two law offices. Somewhere along the line it looks like either the girl got the money and did not give a receipt or either the money is in transit somewhere. Any way you figure it I doubt that Holman is responsible for it. . . . He (appellant) has been under the $25 payment since 1953, he should have made sixteen payments and he can account for fourteen, but has been unable tb account for the other two, and the burden is on him to show those payments, and I couldn’t do anything under this record but to render judgment against him (appellant) for $50 and direct that henceforth he make these payments to the clerk (Clark Chancery) and let the clerk keep up Avith them.”

Finding no error, the decree is affirmed.


author: J. Seaborn Holt, Associate Justice. George Bose Smith, J.,

text:
    Fleming v. Cooper.
    5-790
    284 S. W. 2d 857
    Opinion delivered December 5, 1955.
    [Rehearing- denied January 9, 1956.]

      Jeff Duty and Claude Duty, for appellant.

      Lovell é Evans, for appellee.
   J. Seaborn Holt, Associate Justice.

Francis W. Fleming, appellant, is the wife of Joe W. Fleming and has, for the past 15 years, owned a small farm in Washington County. Appellee Cooper in 1939, under an oral lease agreement with Joe W. Fleming, became Fleming’s tenant from year to year on a fifty-fifty basis and so continued until January 22, 1952, when he left the premises to avoid eviction by the Sheriff. On August 4, 1952, Cooper sued Joe W. Fleming, as the owner of the leased premises (In Case 12872), for his share of the profits alleged due under his lease. Fleming answered, admitting that Cooper was his tenant, and in a cross-complaint alleged, in effect, that under the tenancy agreement, Cooper owed him a substantial amount for expenses incurred in 1949, 1950 and 1951. Cooper filed a reply and also a cross-complaint. Upon trial the court, on September 30, 1953, rendered a decree in favor of Cooper. On appeal here that decree was affirmed. Reference is made to that opinion — Fleming v. Cooper, 224 Ark. 10, 271 S. W. 2d 772, for the complete decree which appears embodied therein.

Pending execution on the mandate from this court in the above decree, appellant, wife of Joe W. Fleming, on November 12, 1954, filed the present suit alleging, in effect, that Cooper became her tenant in October, 1939, on the same land involved in the first suit above (12872) and continued as her tenant until the close of 1951: that during 1951 and 1952 she spent substantial sums of money on the land, that her husband, Joe W. Fleming, was her manager and that Cooper had orally agreed to pay her the money she had expended; that in November, 1951, she and Cooper became involved in a disagreement or controversy as to the correct amounts owed to each party, and as to further occupancy of the real estate, and that she had served notice on him to vacate; that on January 15, 1952, Cooper, through his attorney, proposed an accord and satisfaction based on two letters attached to her complaint, and that she agreed to his proposal. She sought to enforce this accord and satisfaction agreement. She further alleged that Cooper had a judgment against her husband, Joe W. Fleming, in the amount of $828.80, proceeds from the 1952 crop on the above land, which she alleged to be her property, and further prayed for judgment for this amount. Her husband, as garnishee, answered that he had paid this money to his wife, Francis W. Fleming, November 18, 1954, and ashed to be discharged. Joe W. Fleming on December 6, 1954, paid into the registry of the court $917.43 which amount he had paid to his wife on November 18, 1954. A demurrer to Francis W. Fleming’s complaint was overruled and on February 5, 1955, Cooper filed a combined motion to dismiss and an answer. His answer was a general denial and he specifically pleaded that Francis W. Fleming was barred, in the present suit, by the statute of limitations, and by the former suit (12872) on the ground of res judicata and estoppel.

On a trial the court, February 26, 1955, sustained Cooper’s plea of res judicata and estoppel, dismissed appellant’s complaint for want of equity, and awarded Cooper $941.10 plus interest and costs. From that decree is this appeal.

Appellant relies on two points: “I. The court erred in sustaining the motion to dismiss filed by the appellee in that the defense of res judicata and estoppel does not apply under the facts in this case and was not established by the appellee. II. The appellee did not discharge the burden of proof necessary to establish the defense of res judicata and estoppel.” In the decree of February 26, 1955, the trial court found in part — “. . . the examination and study I have made of the instant case and prior case No. 12872 convinces me in truth and in fact that the two cases were identical in that the plaintiff (appellant) having set up and pleaded a contract, proceeds to plead and set up in almost precisely the same language, the earlier accounts of debit and credit and the same basis for debit and credit and the same prayer for relief as was embodied in the complaint in the first suit; ... It is my belief that the pleader in this case had asked for the specific relief that the plaintiff in the former complaint had asked for in his prayer of relief and that the relief in both cases was based on the same set of facts; that there was the same previously pleaded owner-tenant farm arrangement; that the court does not pass on whether or not the newly alleged contract was a proper contract but it is clear to me that the two cases are the same; that the first case was tried in my court and appealed to the Supreme Court and decided by the Supreme Court; that res judicata is simply the basic proposition of estoppel; ... It is, therefore, on particular facts involved in the case concerned, its pleadings and the particular circumstances existing, that sometimes a wife may be collaterally estopped by reason of her husband’s act or acts as in the instant suit by reason of the relationship of husband and wife where the wife has knowledge of such acts. . . . She knew about the other suit because she stated in the notice to vacate “ ‘Yon are hereby notified to quit and vacate our property’ and that such notice was signed by Joe W. and Francis W. Fleming, owners.

“In the original suit I do not recall that it was alleged or admitted in specific terms that Joe W. Fleming was the owner of the land but it is certainly clear to me from the pleadings and the testimony all the way through that Joe Fleming asserted himself to'be the owner; that in this action the plaintiff says: ‘I am the owner and Joe Fleming was my manager, under my immediate supervision, and that certain things were done. ’ The plaintiff then knowledgeably acquiesced in her husband’s assertion of rights on his own account, and now she seeks to assert those same rights on her own account relegating her husband to the role of farm manager, or owner’s agent. I think it boils down to the fact that the Flemings were husband and wife. In the second suit in which Francis Fleming is plaintiff, she is trying the second time to cover the same ground that her husband covered in the original suit.”

"We agree that the preponderance of the evidence supports the above findings. These two cases covered the same subject-matter, the same evidence, and involve, in effect, the same issues sought to be raised in the present suit. The only difference is that Francis W. Fleming, the wife of Joe W. Fleming, was not made a party in the first suit. We are convinced, however, that in that first suit her husband with her knowledge and consent and within the scope of his authority was acting as her agent and manager; that all the while she stood idly by with full knowledge of what was going on, the pendency and progress of the suit, and the final result thereof. In fact, appellant seems to concede that her husband was her agent until the alleged contract of January 19 (based on the letters). She says: “In this case, the appellant alleged that Joe W. Fleming was her agent during the rental of the farm and in the negotiation of the contract with the appellee, but nowhere does she allege that he was her agent after the contract of January 19th was entered into.” It appears conclusive that she must have known about the suit because she and her husband had the following Notice to Vacate served on Cooper.

“TO ELLIS COOPER, Route 2, Springdale, Arkansas.

“You are hereby notified to quit and vacate our property, more particularly described as follows: [describing it]. You are to vacate said property within ten (10) days after the service of this notice upon you. Witness our hands this 9th day of January, 1952.

/s/ Joe Fleming

/s/ Francis Whitlow Fleming, Owners.”

In this notice it will he observed that they both claim to be owners of the property involved. It further appears that Francis W. Fleming, following the above notice, called the court reporter several times inquiring about the progress of the suit, and in the circumstances, we hold that she ivas in privity with him and being his wife was equally bound and concluded by the first suit above. The general and applicable rule is stated in 50 C. J. S., Page 342, § 798 (Judgments). “There is no legal privity between a husband and wife in such a sense that a judgment for or against the one will conclude the other, where the action concerns their separate property, rights, or interests not derived from, each other. . . .

“Under some circumstances, however, a judgment against one spouse is binding on the other spouse. A wife will be concluded by a judgment in an action for or against her husband with respect to any right or interest which she claims through or under him; and so likeAvise will a husband be concluded by a judgment for or against the wife in respect of a right or interest which he claims through or under her. Also either spouse may be concluded where he or she was joined as a party with the" other and such joinder Avas not improper, or where, although not a formal or nominal party, he or she Avas the real party in interest, or sanctioned the suit, or assumed a right to control or actively to participate in the trial or its management. Where the husband acts as agent for the wife, not only in the litigation but in the transaction out of which it arises, she is bound by the judgment where the litigation is.conducted in his name, or originally in the names of both of them and, on appeal, in his name alone, and he is bound, where the litigation is in her name.”

In a someAAdiat similar situation, in effect, this court in Collum v. Hervey, 176 Ark. 714, 3 S. W. 2d 993, reversed the loAver court’s judgment in Avhich it had refused the plea of res judicata offered by defendant. The plea of res judicata seemed to be based upon a chancery decree involving title to real estate in which action the wife had not been made a party. We there said: “It is the opinion of the majority of the judges, that Senie Hervey being the wife of Isom Hervey, living with him at the time, she was represented by the husband in the suit, was in privity with him, and equally concluded by the proceedings.

“A judgment in favor of or against the husband in an action involving a debt due the community will bind the wife regardless of her nonjoinder. . . . And even in jurisdictions where both husband and wife are necessary parties in actions affecting community real property, a judgment either for or against the husband in an action to which the wife is not a party is not necessarily void on collateral attack; where the action was brought by the husband alone, the judgment is binding on the wife, unless she avoids it by showing that it was commenced and prosecuted without her knowledge or consent. 31 C. J. 160.” See also Haffke v. Hempstead Co. Bank & Trust Co., 165 Ark. 158, 263 S. W. 395.

In the circumstances Cooper’s plea of res adjudieata against the present suit is well founded and must be sustained. In our recent case of Missouri Pacific Railroad Company, Thompson Trustee, v. McGuire, 205 Ark. 658, 169 S. W. 2d 872, we said: “As stated in 30 Am. Jur. 908: ‘Briefly stated, the doctrine of res judicata is that an existing final judgment rendered upon the merits, without fraud or collusion, by a court of competent jurisdiction, is conclusive of rights, questions, and facts in issue, as to the parties and their privies, in all other actions in.the same or any other judicial tribunal of concurrent jurisdiction.’

“And in 30 Am. Jur. 957, in discussing who aré privies within the rule of res judicata, it is stated: ‘In general, it may be said that such privity involves a person so identified in interest with another that he represents the same legal right. It has been declared that privity within the meaning of the doctrine of res judicata is privity as it exists in relation to the subject-matter of the litigation, and that the rule is to be construed strictly to meart- parties claiming under the same title. ’ ’ ’

Appellant’s earnest contention that the present suit was based, in effect, upon a written contract evidenced by the two letters above referred to from Cooper’s attorney to Joe W. Fleming, is, we hold, without merit. The first letter (January 15, 1952) was as follows: “Dear Joe: Ellis Cooper has brought to me this Notice to Vacate you had served on him. Ellis has consulted me for some time about your difficulties.

“You realize, of course, the same as I do that where a man is renting on a year to year basis, to give him a valid legal notice you have to give him a six months notice directed towards the end of the term, so legally to have required Mr. Cooper to vacate on January 1, 1952, notice would have had to have been given on or before July 1, 1951.

“But that is neither here nor there. You want your place and Ellis wants to give you the place. He has been talking to me about several of the things for which you owe him; the repairs on the pump and the sprayer, the tractor, and putting in the fall cover crop after harvesting the grapes, and I have long since learned that every difference has two sides so I am quite sure you have things that you feel he owes you for.

“Let’s do this. You give him a receipt in full setting up that he doesn’t owe you any further; that every debt he owes you is paid in full and then I will have him give you a similar receipt in full; then when that is done he tells me that he can move off the place probably within the time you have specified and certainly by February 1. ’ ’

.The second letter (January 19, 1952) as follows: “Dear Joe: Ellis was in this afternoon, and I went over with him in detail our conversation of Thursday. He asks me to advise you that he will have the premises vacated entirely by 6:00 p.rn., Tuesday, Jan. 22nd, 1952.'”

These letters evidently were efforts on the part of Cooper’s attorney to adjust Cooper’s controversy with the Flemings without a lawsuit' and contemplated further- negotiations. No meeting of the minds necessary to a contract' can be gleaned from them. The most that resulted was that after Mr. Lovell imparted to his client, Cooper, the conversation that he, Lovell, had had with Joe W. Fleming, Cooper vacated the property on January 22, 1952, without settling their differences. We think it is clear that no accord and satisfaction was had here. “A discharge of claims by way of accord and satisfaction is dependent upon a contract, express or implied; and it follows that the essentials necessary to valid contracts generally must be present in a contract of accord and satisfaction. Therefore, the following elements are essential: (1) A proper subject-matter, (2) competent parties, (3) an assent or meeting of the minds of the parties, and (4) a consideration.” 1 Am. Jur., § 5, page 217.

We think that in addition to the absence of meeting of the minds, necessary to support an accord and satisfaction, there were also lacking competent parties. Finding no error the decree is affirmed.

Justice Smith dissents.

George Bose Smith, J.,

dissenting. It does not seem to me that the appellee’s plea of res judicata has been established by a preponderance of the evidence. To sustain his burden of proof the appellee has merely shown that Mrs. Fleming took two steps that were in some way connected with the suit against her husband. First, she joined her husband in giving Cooper notice to vacate the premises. But Cooper voluntarily surrendered possession; so the notice accomplished its purpose and passed out of the picture. The subsequent suit was not brought by Fleming'as landlord, pursuant to the notice; on the contrary, it was brought by the tenant and involved an accounting rather than the issue of possession. Consequently it cannot fairly be inferred from the mere giving of the notice to vacate that Mrs. Fleming even knew of the suit later brought against her husband, much less that she controlled or participated in that suit.

Second, it is shown that after the prior case had been completed in the trial court Mrs. Fleming telephoned the court reporter to inquire about the progress being made in preparing the record for appeal. This doubtless proves that Mrs. Fleming knew that a lawsuit between her husband and Cooper had been tried and was to be appealed, but again there is no basis for an inference that she either controlled the litigation or participated in it.

Admittedly Mrs. Fleming was not a party to the former suit, nor was she in privity with her husband in the sense of having succeeded to his interest in the subject matter of the litigation. Hence she ought not to be bound by the prior decree in the absence of proof that she controlled that litigation or participated in it to such an extent as to raise an estoppel. Rest., Judgments, § 84; Hill v. Village Creek Dr. Dist., 215 Ark. 1, 219 S. W. 2d 635. In my opinion the appellee has not met the burden of making that proof.

"When we lay aside Mrs. Fleming’s two inconsequential points of contact with the earlier suit, all that remains is the proof that her husband claimed ownership of the land in the first suit and that she now claims ownership in an effort to relitigate the same issues. In a similar situation, in which the wife asserted ownership after her husband had already lost a case that had been appealed to this court, we held that the wife’s complaint stated a cause of action. Dodson v. Abercrombie, 218 Ark. 50, 234 S. W. 2d 30. It seems to me that the Dodson case should control our decision in the case at bar.


author: Ed. F. MoFaddin, Associate Justice.

text:
    Reddell v. Norton.
    5-781
    285 S. W. 2d 328
    Opinion delivered December 5, 1955.
    [Rehearing- denied January 23, 1956.]

      Moore & Villines and Fitton & Adams, for appellant.

      A. B. Arbaugh and Willis <&. Walker, for appellee.
   Ed. F. MoFaddin, Associate Justice.

This case stems from a most unfortunate traffic mishap in which two young men were killed and a third was seriously injured.

On the night of May 1, 1954, Joe Holt, Paul Norton and Cecil Smith attended the picture show in Jasper and Started home on the Mt. Judea gravel road in a 1%-ton truck, driven by Joe Holt and owned by Otis Holt, his father. On the same night appellant, Walter Reddell, and his sister attended the picture show in Jasper and started home on the Mt. Judea gravel road in a %-ton pick-up truck driven by Walter Reddell. When several miles from Jasper the Holt truck was overtaken and passed by the Reddell truck and the occupants of the two trucks recognized each other. Then, in less than a mile, the Holt truck attempted to pass the Reddell truck; and in so doing the Holt truck went off the road at a curve: the three occupants were thrown out; Paul Norton and Cecil Smith were both killed; Joe Holt was injured; and the Holt truck was demolished. The Reddell truck remained on the road and later returned to the scene of the catastrophe where Walter Reddell attempted to assist in rendering aid.

This action was filed against Walter Reddell by (a) the parents of Paul Norton for damages for the death of their son; (b) the parents of Cecil Smith for damages for the death of their son; (c) Joe Holt for his own personal injuries; and (d) Otis Holt for damages to his truck. The plaintiffs (Norton, et al) alleged that the negligence of Walter Reddell caused the plaintiffs’ damages. The defendant, Walter Reddell, denied liability, alleged the driver of the Holt truck was negligent and claimed that such negligence was legally imputable to the other occupants of the Holt truck and to the owner thereof. The case was tried to a Jury which rendered these verdicts: (a) $3,700.00 to the parents of Paul Norton; (b) $3,700.00 to the parents of Cecil Smith; (c) $500.00 to Otis Holt for damages to his truck; and (d) no damages to Joe Holt for his personal injuries. From a judgment on the verdicts Walter Reddell brings this appeal; and Joe Holt has cross-appealed.

I. Sufficiency of the Evidence. This assignment, made by Walter Reddell, necessitates a brief review of other salient testimony in addition to the facts already recited. Joe Holt testified: that he and Paul Norton went to Jasper in Otis Holt’s truck; that after the picture show they were joined by Cecil Smith; that the three hoys started home on the Mt. Judea gravel road; that when they were about 2% miles from Jasper they were passed by the Reddell truck; that about %ths of a mile farther down the road the Holt truck attempted to pass the Reddell truck; that Holt blinked his lights as a proper passing signal; that Reddell moved over to the extreme right in response to the signal; that the gravel road was wide enough at that point for the Holt truck to pass on the left; that as the Holt truck was alongside the Red-dell truck, Reddell speeded up to about 40 miles per hour (same speed as the Holt truck); that the two trucks ran alongside for about 300 yards; that as the two trucks reached a curve where the roadway was somewhat narrower the Reddell truck bumped the Holt truck; that such bump caused the Holt truck to leave the road, go into a ditch and into the field with the casualty to the occupants; that the entire mishap Avas caused by Reddell’s actions and not by a blowout on the Holt truck; and that the blue paint of the Reddell truck was visible several days later on the Holt truck.

The effect of Joe Holt’s testimony AAras, that he Avas all the time driving with due care and in a lawful manner and attempted to pass the Reddell truck only after the blinking of the lights by Holt and the moving over by Reddell, and that Reddell then speeded up and caused the catastrophe by hitting the Holt truck and forcing it from the highway. There is no need for us to recite all the testimony: there were contradictions as to speed, evidence as to racing, and evidence as to a tire bloAvout being the cause of the Holt truck leaving the highway. All these matters Avere questions for the Jury. The case Avas submitted on instructions covering highway rules and regulations as to driving and passing, negligence, contributory negligence, imputed negligence and duty of guests to protest against unsafe driving. No complaint •is here made as to any of the instructions.

As to the parents of Paul Norton and Cecil Smith, the Jury could have found from the evidence that these boys were guests and were in no way negligent, nor liable for any negligence of Joe Holt. The negligence of a driver cannot be imputed to the guests unless the guests failed to use ordinary care for their own safety. Mo. Pac. R. Co. v. Johnson, 204 Ark. 604, 164 S. W. 2d 425; Crossett Lbr. Co. v. Cater, 201 Ark. 432, 144 S. W. 2d 1074; Mo. Pac. R. Co. v. Henderson, 194 Ark. 884, 110 S. W. 2d 516. As to Otis Holt, the evidence was sufficient to support the Jury’s conclusion that he was a bailor and that his son, Joe Holt, was bailee of the truck. "We have repeatedly held that the negligence of the bailee is not imputable to the bailor when the subject of the bailment is damaged by a third party. Mo. Pac. R. Co. v. Boyce, 168 Ark. 440, 270 S. W. 519; Featherston v. Jackson, 183 Ark. 373, 36 S. W. 2d 405; and Sanders v. Walden, 212 Ark. 773, 207 S. W. 2d 609.

This rule is well established:

“In determining the sufficiency of the evidence to sustain a verdict, the Supreme Court views the evidence in the light most favorable to the appellee, and will not set aside a verdict if supported by substantial evidence.”

See Albert v. Morris, 208 Ark. 808, 187 S. W. 2d 909, and cases there cited. In keeping with the foregoing rule, we reach the conclusion that the evidence is sufficient to sustain each of the verdicts against Walter Reddell.

II. Motion for Judgment Non Obstante Veredicto, Walter Reddell moved for such judgment against Otis Holt claiming that the verdict refusing Joe Holt any recovery was tantamount to a finding that Joe Holt was negligent and that since Joe Holt was the driver of Otis Holt’s truck, Otis Holt should also be barred from recovery. The Trial Court was correct in refusing the motion because of the bailor-bailee relationship previously discussed. Joe Holt’s contributory negligence would bar him from a recovery; but would not bar the owner of the Holt truck.

Walter Reddell also moved for judgment non obstante veredicto against the other defendants on various grounds. It was claimed, inter alia, that Paul Norton had urged Joe Holt to “pass him” (referring to Holt’s effort to pass the Reddell truck); but there was some evidence that Paul Norton said ‘ ‘ pull around him, ’ ’ which could have been interpreted by the Jury as an admonition for safe driving rather than one for increased speed. At all events, the motion for judgment non obstante veredicto was correctly refused, because the evidence was disputed. See Scharff Distilling Co. v. Dennis, 113 Ark. 221, 168 S. W. 141.

III. Court Ruling in Regard to Addresses to Jury. After all the evidence and after the instructions, the attorneys made their addresses to the Jury; and the transcript contains what purports to be the content of these addresses. Mr. Arbaugh opened for the plaintiffs; Mr. Adams, Mr. Vallines and Mr. Moore spoke in that order for the defendant; and Mr. Willis closed for the plaintiff. Appellant claims that the Trial Court should have refused to allow Mr. Willis in his argument to comment on the amount of damages, since such amount was not discussed in Mr. Arbaugh’s opening argument.

There are several answers to this contention. One answer is found in the Statute. Section 27-1727, Ark. Stats., in stating the order of trial, says:

“The parties may then submit or argue the case to the jury. In the argument the party having the burden of proof shall have the opening and conclusion; and if, upon the demand of his adversary, he shall refuse to open and fully state the grounds upon which he claims a verdict, he shall be refused the conclusion. ’ ’

Under the quoted language, the defendant’s attorneys should have demanded that the plaintiff’s attorneys make a full and complete opening statement if defendant’s attorneys desired to make the subsequent claim- — now urged —that new matter was injected into the closing argument. Defendant’s attorneys made no such demand. See Dickinson v. McBride, 127 Ark. 555, 193 S. W. 89; and see also Annotation in 38 A. L. R. 2d 1396.

Another answer' to the contention now urged is in the matter of the' discretion of the Trial Court. We have many times held that the Trial Court is clothed with considerable discretion in controlling the argument of counsel to the Jury. The case of Mo. Pac. R. Co. v. Hood, 198 Ark. 792, 131 S. W. 2d 615, reviews many of our holdings and states the general rule. See also Jackson v. State, 216 Ark. 341, 225 S. W. 2d 522, 15 A. L. R. 2d 484.

We have carefully read the transcript containing the argument here challenged, and we find no abuse of discretion to have been committed by the Trial Court. In each of the addresses of the defense counsel the Jury Avas urged to be strong against the anticipated address of Mr. Willis: so the defense counsel thoroughly anticipated any argument that was to come. Furthermore, after Mr. Willis discussed the damages in terms of dollars and cents, the defense never asked for an opportunity to ansAver him on that point. If the amount of damages was thought to be a new matter, the defense attorneys should have requested an opportunity to reply to such new argument. See 88 C. J. S. 339. In the absence of any such request, the appellant cannot claim that the Trial Court committed reversible error.

IY. Excessiveness of the Verdicts. Finally, the appellant, Walter Reddell, claims that each of the verdicts against him is excessive; but we find no merit in such contention. As to the $500.00 aAvarded for damages to the truck, there Avas competent evidence to sustain the verdict, because Otis Holt testified without objection that the difference between the value of the truck immediately before and immediately after the accident was $650.00.

As to the verdict of $3,700.00 to the parents of Paul Norton: the evidence showed that the parents paid the funeral expenses in the amount of $760.85; that at the time of his death Paul was 19 years of age; that he had always Avorked at home on the farm just as a hired hand Avould have Avorked, and Avas capable of earning $2,000.00 per year; that he lived with his parents and contributed all of his earning capacity to them; and that there was nothing to indicate that his contributions would not continue. As to the verdict of $3,700.00 to the parents of Cecil Smith: the evidence showed that his parents paid his funeral expenses in the amount of $718.00; that Cecil was only a few months over 18 years of age at the time of his death; that he was capable of earning $2,000.00 per year; that he lived with his parents and contributed all of his earning capacity to them; and that there was nothing to indicate that this would not continue.

Some of our cases involving the elements of recovery and amount of verdicts allowed parents for loss of a child are: St. L. S. F. Ry. v. McCarn, 212 Ark. 287, 205 S. W. 2d 704; Mo. Pac. Ry. v. McKinney, 189 Ark. 69, 71 S. W. 2d 180; Mooney v. Tillery, 185 Ark. 457, 47 S. W. 2d 1087; and Eureka Oil Co. v. Mooney, 168 Ark. 479, 271 S. W. 321. Tested by the holdings of the above cited cases, we cannot say that the verdicts are excessive in favor of the parents of Paul Norton and Cecil Smith.

V. The Cross Appeal. Joe Holt urges in his cross appeal that the Jury should have awarded him a verdict for his personal injuries, since there was a verdict for Otis Holt for the truck; but we find this cross appeal to be without merit. As previously mentioned, the Jury could have returned a verdict for Otis Holt for the damages to his truck and still have consistently found that Joe Holt was guilty of some degree of contributory negligence. The cause of action herein arose on May 1, 1954 and was tried on March 24,1955. The 1955 Comparative Negligence Statute (Act No. 191 of 1955) has no application to this case since such Act did not go into effect until June 1955.

The judgment is affirmed, both on direct appeal and cross appeal.

       Walter Reddell is a minor, and has been duly represented by a guardian ad litem at all stages of the proceedings. George Reddell, father of Walter Reddell, was also sued on the theory that the son was the agent of the father; but evidence failed to establish any liability against George Reddell and the Court instructed a verdict in his favor, and that issue has passed out of the case.

       Joe Holt is a minor and has at all times appeared by his father as his next friend.

       In Larimore v. Howell, 211 Ark. 63, 199 S. W. 2d 820, we listed some of our cases involving motion for judgment non obstante veredicto.


author: Minor W. Millwee, Associate Justice.

text:
    Langley v. Bunn.
    5-787
    284 S. W. 2d 319
    Opinion delivered December 5, 1955.

      Cole & Epperson, for appellant.

      Wood, Chesnutt & Smith, for appellee.
   Minor W. Millwee, Associate Justice.

The issue here is whether a nonresident motorist is amenable to substituted service of process in this state under our nonresident motorist statute where the alleged cause of action arises out of an accident involving the nonresident’s automobile which occurred on private property adjacent to a public highway.

Appellant is an attendant at a service station located on private property adjacent to U. S. Highway No. 67 in Malvern, Arkansas. He brought this action for scalds and burns which he allegedly suffered while servicing the automobile of appellee, a nonresident motorist, at said service station. Substituted service was obtained on the Secretary of State as agent for appellee under our nonresident motorist statute [Act 199 of 1949] which now appears as Ark. Stats., Secs. 27-342.1 to 27-342.3. By special appearance, appellee moved to quash the service because the complaint showed on its face that the alleged cause of action did not occur upon the public highways; and that appellee was neither authorized to nor doing-business in Arkansas. This appeal is from the order of the Circuit Court sustaining the motion to quash.

In reference to the point at issue Sec. 27-342.1, supra, provides: . . the acceptance by a nonresident owner ... of the rights and privileges ... to drive or operate ... a motor vehicle upon the pub-lie highway of [this] state . . . shall be deemed equivalent to the appointment ... of the Secretary of the State of Arkansas . . . to be the true and lawful attorney and agent of such nonresident . . . upon.whom may be served all lawful process in any action . . . growing out of any accident or collision in - which said nonresident . . . may be involved while operating a motor vehicle on such highway .,; By Sec. 27-341.1 the term “Public Highways,” as used in the service statute, is defined to mean “. . . any public highway within the borders of the State of Arkansas including byways, county highways, highways in military reservations, whether used conditionally or unconditionally by the public. ’ ’ This is Section 1 of Act 417 of 1953, enacted following the decision in Camden v. Harris, 109 Fed. Supp. 311, which held the service statute did not apply to roads on U. S. Army posts or reservations.'

In Kerr, Administrator v. Greenstein, 213 Ark. 447, 212 S. W. 2d 1, we held that our nonresident motorist service statute is to be strictly construed because it is in derogation of the common law. "When the above mentioned statutes are so construed together, it is apparent that the Legislature intended that effective service of process may be had under the nonresident motorist statute when the nonresident is involved in an accident or collision while operating a motor vehicle on any public highway or byway in this state whether same be maintained by the county, state or United States, and whether used conditionally or unconditionally by the public. This has been the interpretation placed on similar statutes by the courts of other states.

In those jurisdictions with statutes like our own, the courts have uniformly held that valid service thereunder is limited to actions involving accidents or collisions which occur on the public highways and does not apply to accidents occurring on private property or growing out of the operation of the motor vehicle thereon. Pawloski v. Hess, 250 Mass. 22, 144 N. E. 760, 35 A. L. R. 945; Brauer Machine & Supply Co. v. Parkhill Truck Co., 383 Ill. 569, 50 N. E. 2d 836, 148 A. L. R. 1208; Kelley v. Koetting, 164 Kan. 542, 190 P. 2d 361; Harris v. Hanson, (Idaho) 75 Fed. Supp. 481; Finn v. Schreiber, 35 Fed. Supp. 638.

The service statutes of some states are by their terms made applicable to any accident or collision in which the nonresident may be involved while operating a motor vehicle within the state. The courts of these states have held that service on the nonresident motorist under such statutes is valid even though the action involving the nonresident occurs on, or arises out of operation of the motor vehicle on, private property. Sipe v. Moyers, 353 Pa. 75, 44 A. 2d 263; Paduchik v. Mikoff, 158 Ohio St. 533, 110 N. E. 2d 562.

The New York statute originally read like our own and was construed in Finn v. Schreiber, supra, as not applicable to an action for injuries sustained by a filling station operator while inflating a tire on the truck of a nonresident defendant which was parked on the filling station lot, because such vehicle was not being operated on a “public highway” within the meaning of the service statute. This case was decided in 1940. But the New York Legislature in 1942 amended the statute by substituting the words, “in this state,” for the words, “on such a public highway, ’ ’ previously contained in the statute. The amended statute was held constitutional as a valid exercise of the police power in Leighton v. Roper, Admr., 300 N. Y. 434, 91 N. E. 2d 876, 18 A. L. R. 2d 537, where the court said: “When decedent came upon the highways of this State with his automobile, he subjected himself to our jurisdiction, and consented, while here, irrevocably to bind his legal representatives in an action arising out of any accident in this State in which his automobile was involved.”

It is clear that our statute is like the earlier New York statute and those involved in such cases as Brauer Machine & Supply Co. v. Parkhill Truck Co. and Harris v. Hanson, supra, and applies only to accidents or collisions on a public highway, or arising out of the operation of a motor vehicle on a public highway. Until the Legislature sees fit to broaden its terms, our statute does not apply to accidents like that involved here, which occur upon, or arise out of the operation of a motor vehicle on, private property. The circuit judge correctly so held, and the judgment is affirmed.


text:
    Walker v. Biddle.
    5-792
    284 S. W. 2d 840
    Opinion delivered December 5, 1955.
    [Rehearing denied January 9, 1956.]

      McKay, Anderson & Grumpier, for appellant.

      Spencer é Spencer, for appellee.
   George Rose Smith, J.

In 1943 and 1944 the appellant, Dee Walker, obtained from his sisters, Addie Biddle and Mary Walker, quitclaim deeds to 320 acres of land that had been held by the Walker family for many years. This suit to cancel those deeds was brought by Addie Biddle and by some of Mary Walker’s heirs, the others being named as defendants. The plaintiffs successfully contended below that when the deeds were executed the two sisters were tenants in common with their brother and placed the title in his name merely to enable him to act for all three in the execution of oil-and-gas leases and deeds. Dee contends that the land was already his, that he had put the title in the names of his wife and two sisters for the purpose of defrauding a judgment creditor, and that after the judgment claim had been settled the sisters simply reconveyed the title to him.

Since we have concluded that all issues of fact must be determined adversely to the appellant by reason of a letter he wrote to Addie Biddle a few months before this suit was filed, we pass quickly over the background facts. The Walker children inherited the land from their father in 1907 but lost it by foreclosure in 1927. Title was regained in 1931 when Henry Stevens executed a deed to Dee’s wife and the two sisters. Dee says that he alone arranged to repurchase the land from Stevens in 1927, that he made payments until the debt was satisfied in 1931, and that Stevens, who was Dee’s attorney, made the deed to Dee’s wife and sisters in order to protect the title from an unsatisfied judgment against Dee. The testimony on the other side is that the brother and two sisters all lived on the land, worked the crops together, and by their joint efforts regained the land as tenants in common.

Title remained in the three women until Addie and Mary gave Dee a quitclaim deed to 160 acres in 1943 and a similar deed to the other 160 acres in 1944. These are the deeds now in controversy; we have mentioned the conflicting reasons that are given by the parties for the execution of these conveyances.

The brother and sisters continued to live on the property until Mary died in 1947. According to Addie’s testimony, in 1950 and thereafter she tried to persuade Dee to divide the land, but Dee wanted to postpone the division until he could “get shed” of his second wife. On June 26, 1952, Dee wrote his sister this letter, which we consider to be decisive :

“Hello Addie how are you find I hope this leave al well hope this will find you al the same I got your letter was glad to here from you But sorry that you think I am made with you for what listen Addie you is got land her just like I am dont want your land and aint trying to take it from you listen I have married the laward [lawyer] told me let that land stay like it is if I dont my wife can get a part of it that why I wont vied [divide] it if it stay like it is she can not get any thing that why I dont want to vied it yet a while that why I diden want you to talk with me before her that night listen when you come down here I will tell you al a bout it when I see you a gen I dont want you land so with love

Dee Walker”

Confronted with this letter Walker was unable to explain why he had written that his sister had land just as he had, why he had assured her that he was not trying to take it from her, or why he had thought is necessary to give a reason for not dividing the land. When this letter is considered with the other testimony we conclude that the appellees have met the burden of showing by clear and convincing proof that the deeds in question were made in reliance upon Walker’s promise to hold the land for himself and his sisters.

Aside from this question of fact the appellant urges two issues of law. First, it is argued that the statute of frauds prevents the enforcement of Dee’s oral promise to hold the title for his sisters. This is time, but the statute by its terms does not apply to a constructive trust. Ark. Stats. 1947, § 38-107. That type of trust is involved here. When the grantee’s oral promise to hold for the grantor is fraudulently made, or when such a promise is given by a grantee who stands in a confidential relation to the grantor, equity will impose a constructive trust upon the grantee’s refusal to perform his promise. Armstrong v. Armstrong, 181 Ark. 597, 27 S. W. 2d 88; Rest., Restitution, § 182; Rest., Trusts, § 44. The relation between brother and sister is, in the absence of estrangement or other unsual circumstances, one of confidence; they are not regarded as dealing with each other at arm’s length. Gillespie v. Holland, 40 Ark. 28, 48 Am. Rep. 1; Reeder v. Meredith, 78 Ark. 111, 93 S. W. 558, 115 Am. St. Rep. 22.

Second, it is contended that since the statute of limitations, in the absence of concealment, runs in favor of the trustee of a constructive trust, Matthews v. Simmons, 49 Ark. 468, 5 S. W. 797, this suit is barred by the seven-year statute. The answer is that the constructive trust did not arise at the moment the deeds were executed. It is the transferee’s repudiation of his promise that brings the trust into being. The evidence indicates that Walker did not claim the land as his own until after his sister Mary’s death in 1947; so the bar of the statute had not fallen when this suit was brought in 1952.

Affirmed.


text:
    The Lumbermen’s Mutual Ins. Co. of Mansfield, Ohio v. Wheeler.
    5-788
    284 S. W. 2d 620
    Opinion delivered December 5, 1955.

      Wood & Smith, for appellant.

      Lookadoo, Gooch & Lookadoo, for appellee.
   Paul Ward, Associate Justice.

On March 21, 1953, appellee, Arthur Wheeler, purchased a 1940 Chevrolet automobile from W. T. Matlock [also an appellee] for the purchase price of $225 on credit, with Matlock retaining title to the automobile. Also on said date the appellant insurance company issued its policy to Wheeler covering the actual value of the car with $50 deductible. This policy contained the following clause: “Loss Payee: Any loss hereunder is payable as interest may appear to the insured and W. T. Matlock. . . .”

On April 19, 1953, while the above mentioned policy was in force and when Wheeler was still indebted to Matlock in the full amount, the automobile was damaged to the extent of $200, fixing the liability of appellant [after deducting $50] at $150. Upon notice to appellant its adjuster went to see Matlock, and Matlock in turn sent the adjuster to Wheeler. Pursuant to an agreement between Wheeler and the adjuster [the exact terms of which are in question] Wheeler agreed that he could take $75 and repair the automobile himself. Thereupon the adjuster filled out a “Proof of Loss” which Wheeler signed. After describing the car and the insurance provisions in general terms this instrument stated that the actual cash value of the car was $225; that the actual loss and damage was $125, and; the amount due Wheeler was $75. On June 4, 1953, appellant, through its general agent, issued its check for $75, made out to Arthur Wheeler and W. T. Matlock, and mailed the same to Mat-lock. Matlock refused to accept the check, and he and Wheeler instituted this action against appellant on the policy to collect $150.

The complaint alleges that the automobile had a cash value of $225 and that its salvage value was only $25 and the prayer was for judgment in the amount of $150. Appellant’s answer stated “that Arthur Wheeler, the named assured, agreed to accept the damaged automobile and the sum of $75 as full settlement . . that an accord and satisfaction had been reached, and “that the rights of W. T. Matlock, under the open loss payable clause in the policy, are derivative and subordinate to the rights of the named assured.”

After hearing all the testimony on both sides, the trial judge, sitting as a jury, found in favor of appellees. In a “Memorandum Opinion” the trial judge gave as the reason for his decision that there never was any actual meeting of the minds of Wheeler and the adjuster. He also found that Wheeler never received the check because it was made jointly to him and Matlock and mailed to Matlock, and that the check was never cashed and was eventually returned. The trial judge further found that the undisputed evidence showed that the car was worth $225 before the wreck and that it was worth only $25 after the wreck, and that appellant was therefore indebted to appellees in the sum of $150.

We are convinced that the judgment of the trial court must be affirmed. We are not called upon to decide whether there was substantial evidence to support the trial judge in the finding of fact which he made because the ground upon which we rest our decision makes it unnecessary to do so.

Under the authority of Insurance Underwriters’ Agency v. Pride, 173 Ark. 1016, 294 S. W. 19, Wheeler in this instance had no right to make a settlement with appellant insurance company without the consent and approval of Matlock. In the cited case, at page 1021 of the Arkansas Reports, this court said: “We think a mortgagee or lienholder acquires a vested and enforceable right under an ordinary loss-payable clause as his interest may appear in an insurance policy which cannot be destroyed by a settlement or adjustment between the insurer and the insured. ’ ’ This case was cited with approval in Cash v. The Home Insurance Company of New York, 197 Ark. 670, 125 S. W. 2d 99. In Vol. 5 of Apple-man’s Insurance Law and Practice, Section 3406, at page 578, it is stated:

“The most confusing question has probably arisen where a settlement has been worked out between the insured and the company, by which they attempt to bind the mortgagee, and in which settlement he has had no opportunity to participate. The general rule has been, under both open loss payable clauses and under the standard and union clauses that this cannot be done; those courts considering that the mortgagee’s rights cannot be concluded by the acts of those parties.”

An annotation in 38 A. L. R., at page 383, contains this statement:

‘ ‘ The weight of authority is to the effect that a mortgagee entitled to the proceeds of an insurance policy by virtue of a simple loss-payable clause in the policy is not affected or bound by an adjustment of the loss, whether by arbitration or agreement, by the insured and the insurer, without his knowledge or consent. ’ ’

In Vol. 46 C. J. S., at page 28, among other things, it is stated that “under a standard mortgage clause the rights of the mortgagee are not affected by any act done by the insured.” In Detroit Fire & Marine Ins. Co. v. Helms, 184 Ark. 308, 42 S. W. 2d 394, the court in discussing a similar question, stated, at page 311 of the Arkansas Reports: “But the court correctly held that the association could recover to the extent of its mortgage, as it is well settled that a mortgagee, under a standard mortgage clause, is not affected by the acts or omissions of the insured that would avoid the policy as to him. ’ ’

We note of course that the rule announced above presupposes that the mortgagee or lien holder does not authorize the settlement made by the insured. In this case the adjuster testified that Matlock told him “to go on and work it out with the named insured — to make the adjustment on the claim with Mr. Wheeler — that anything we worked out would be satisfactory to him. ’ ’ Mat-lock emphatically denied that he made any such statement. So we are faced with the situation that this testimony raised a fact issue which the trial judge did not pass upon. We think however that this is immaterial for the reason that there was no consideration for Matlock making the statement attributed to him, if he in fact did make it. It is undenied that when the check for $75 was mailed to Matlock he refused to accept it and returned it to appellant’s attorney. Under these circumstances Mat-lock had a right to refuse the settlement attempted by Wheeler. Matlock, as shown heretofore, had a vested right in the entire amount due under the policy. It cannot be said that appellant relied on Matlock’s alleged agreement to bind itself to pay $75, because appellant had not bound itself to pay anything. No one on behalf of appellant signed the “Proof of Loss” which contained the alleged agreement with Wheeler. , In fact the instrument expressly stated it “is not a waiver of any rights of the said insurer.” To hold otherwise than we do would be to hold that Matlock was bound by an agreement which did not bind appellant.

It should be pointed out that we do not indicate what our holding would be if the “Proof of Loss” had not contained the non-waiver clause quoted above.

Affirmed.


text:
    Hill v. Hill.
    5-789
    284 S. W. 2d 321
    Opinion delivered December 5, 1955.

      A. James Linder, for appellant.

      Etheridge & Sawyer, for appellee.
   Sam Robinson, Associate Justice.

Appellant Hazel Hill filed this suit asldng that she be granted a divorce from the appellee, J. C. Hill. The answer was a general denial and, in addition, appellee filed a cross complaint in which he asked that he be granted a divorce. Later the defendant amended his cross complaint by withdrawing his prayer for a divorce and by mailing the allegation that he had an interest in certain real and personal property in the possession of the appellant. He asked for a judgment for the value of his alleged part of such property.

At the trial Hazel was granted a divorce, and there is no appeal from the decree in that respect. The Chancellor made a finding that Hill was the owner of an interest in the property in question and appointed a receiver to take charge of the property and act as a master in making a determination as to the equities of the parties, and to sell the property and divide the proceeds accordingly. Hazel has appealed from that part of the decree holding that appellee has an interest in the property involved.

The parties were married on October 23, 1950, and separated in the first part of October, 1954. Hill is about 40 years of age, and his wife a little older. There is no showing that Hill had accumulated any property, real or personal, at the time of the marriage. Subsequent to his marriage in 1950, he bought a 1937 model Chevrolet. Latér, he bought a newer model car but failed to make the monthly payments and it ivas repossessed by the seller. He did not own a car at the time of the- trial.

At the time of her marriage in 1950, Mrs. Hill owned and operated the Elite Cafe. She owned her own home and, in addition, she owned an adjoining lot on which was situated a small building that was later moved to the front of the lot and converted into a restaurant. Subsequently, three tourist cabins were also constructed on this lot. In raising the money to do this work, Mrs. Hill sold the Elite Cafe for $1,100, borrowed $1,000 from her sister and mortgaged her home for $1,500. She later mortgaged the lot on which were situated the restaurant and cabins to get money to enlarge the restaurant.

Hill claims that some of the money he earned was used in the construction of these buildings and in furnishing them. He also says that he did some of the construction work and as a result he owns an interest in the buildings and in the furnishings. Even if some of Hill’s money went into construction of the buildings and in furnishing them, he has not proved by a preponderance of the evidence any definite amount that would support a judgment. To say that he furnished any amount of money over and above the sum required to support himself and his wife would be pure speculation. And, the Chancellor could not make a determination from the evidence as to just how much Hill put into the business, if anything. During the time of the marriage, Hill earned an average of about $177.00 a month. After supporting himself and his wife he surely could not have had much left for investment purposes.

Since the Chancellor could not determine from the evidence how much money Hill had put into the business, if any, a receiver was appointed to take charge of the property and to act as a master and state an account between the parties. But the case appears to have been fully developed, and a receiver or a master would be in no better position than the court to arrive at a conclusion. The burden of proof was on Hill to prove the allegations of his cross complaint by a preponderance of the evidence. Since he failed in this respect, it cannot be said he has shown that he has any interest in the property involved. His cross-complaint should be dismissed for want of equity. The decree is accordingly reversed.