author: J. Fred Jones, Justice.

text:
    NORTH LITTLE ROCK URBAN RENEWAL AGENCY et al v. E. E. VAN BIBBER et al
    5-5903
    483 S.W. 2d 223
    Opinion delivered July 24, 1972
    [Rehearing denied August 28, 1972.]

      Kenneth Coffelt, for cross-appellant G. D. Nelson.

      John Harm.on, for North Little Rock Urban Renewal Agency.

      Patten, Brown ¿r Leslie and Langston ir Langston, for appellees.
   J. Fred Jones, Justice.

E. E. Van Bibber was the owner of two lots and a building thereon at the corner of Pike Avenue and 10th Street in the City of North Little Rock. On the first day of November, 1967, he leased these premises to G. D. Nelson for a term of 12 years at a monthly rental of $400. This lease concluded with a clause as follows:

“It is agreed between the parties hereto that this lease is not assignable.”

Nelson went into possession of the premises under his lease and operated a drive-in restaurant business in the building especially designed for such purpose on the property. On or about April 29, 1969, Nelson sold his equipment and the good will of the business to Douglas D. James for $40,000 to be paid $6,000 down and $34,000 in monthly installments of $521.72 each. In connection with this sale a written assignment of the lease from Van Bibber to Nelson was prepared but was never signed by Van Bibber. During the course of the negotiations between Nelson and James, it became apparent that the property might be taken by the North Little Rock Urban Renewal Agency; consequently, they entered into an agreement on May 28, 1969, under which Nelson and James agreed that should the North Little Rock Urban Renewal force the business to be moved from its present location, James should have an option as follows:

“1. To forfeit all monies paid in, let Mr. Nelson deal with the Urban Renewal on satisfying the lease and in return Mr. Nelson would cancel all notes, sales, contracts, bills of sale, etc.
2. Mr. James to deal with Urban Renewal on satisfying the lease and fulfill all obligations under the contract.”

On September 24, 1971, Mr. James gave notice to Mr. Nelson as follows:

“* * #[W]e hereby exercise our option as follows: To deal with Urban Renewal on satisfying the lease and fulfill all obligations under the contract.
In performance and execution of our option, we will continue to make payments on a certain promissory note dated April 29, 1969, in the principal amount of $34,000.00 on which there is a present principal balance due of approximately $25,000.00, according to its terms Und conditions until the same is paid in full.”

This litigation originated when on February 16, 1971, Mr. Van Bibber filed suit in the Pulaski County Chancery Court against Nelson, James and the North Little Rock Urban Renewal Agency setting out the lease he had entered into with Nelson and alleging that Nelson had breached his lease contract by assigning it to James without the knowledge and consent of Van Bibber for the sum of $900 per month. Van Bibber alleged that North Little Rock Urban Renewal Agency was threatening to take the property and would do so unless restrained by court order. Van Bibber prayed that the lease between him and Nelson be canceled and that the North Little Rock Urban Renewal Agency be restrained and enjoined from taking the property.

The North Little Rock Urban Renewal Agency filed its answer and counterclaim against Van Bibber seeking a condemnation of the property under right of eminent domain. The counterclaim sought immediate possession of the property and a determination of the damages to which the plaintiff Van Bibber was entitled. By amended answers both Nelson and James asserted leasehold interests under their respective leases and agreements, and they prayed compensation in damages for the taking.

Following trial, the chancellor found that the North Little Rock Urban Renewal Agency had the power of eminent domain and that it was necessary for it to take the property in question. The chancellor found that the fair market value of E. E. Van Bibber’s reversionary interest amounted to $101,376.11; that the remaining value of the lease from Van Bibber to Nelson amounted to $28,832.89, entitling Van Bibber to $130,209. The chancellor further found that the separate leasehold interest amounted to $64,264.87, and that James was entitled to the fair market value of this leasehold interest. The chancellor entered a decree directing the Urban Renewal to pay to Van Bibber the aforesaid sum of $130,209 and to James the sum of $64,264.87.

On appeal to this court the North Little Rock Urban Renewal Agency relies on the following points for reversal:

“The trial court erred as a matter of law in ruling that the covenant prohibiting assignment of the lease between Van Bibber and Nelson had not been breached and ruling that condemned property was subject to leasehold interest.
The formula used by the Court in determining the damages to the leasehold was not a proper approach and constituted an error of law. In addition, the amount awarded for the leasehold was not supported by substantial evidence.
The Court erred in allowing the testimony of Jim Hood, Frank Ashcraft, W. H. Pitcock and Jack Farris as expert witnesses.”

G. D. Nelson also appeals from the chancellor’s decree and relies on the following point:

“The decree of the trial court in favor of James against Nelson is contrary to both the law and the evidence.”

As to the appellants’ first point on breach of the contract by assignment, James contends, and the chancellor found, that the contract between Van Bibber and Nelson simply provided that the lease was nonassignable but did not provide for a cancellation of the lease in the event the lessee attempted to assign it. The appellees further contended, and the chancellor so found, that Van Bibber had ratified the actions of Nelson in assigning the lease or subleasing the property to James. Our decision in Fort Smith Warehouse Co. v. Friedman, 111 Ark. 15, 163 S. W. 175, cited by the appellants is distinguishable on its facts from the case at bar. In Friedman, a two year lease contract not only contained a clause providing that the lessee should not assign the lease nor sublet the premises without the written consent of the landlord, it also contained a clause which provided that if the lessee should assign the lease or sublet the premises without the landlord’s consent, the landlord might terminate the lease and take possession of the premises without giving any notice in writing to quit. This court in Friedman applied the general rule that:

“where the lease, by its terms, imposes restrictions on the right of a tenant to assign or sublet the premises, and also contains a provision for re-entry and forfeiture of the lease by the landlord, upon breach of these covenants the landlord may declare the lease terminated and take possession of the premises.”

We are unable to say that the chancellor’s findings on these points are against the preponderance of the evidence.

In the case at bar James was actually paying to Nelson the agreed monthly payments of $521.72 on the purchase price of the equipment and good will of the business, and in addition he was paying to Nelson the $400 per month which Nelson was obligated to pay to Van Bibber as rent. The record indicates that on at least two or three occasions Van Bibber found James in complete control of the business; he was completely satisfied with James’ operation of the business and he also received and accepted the $400 rental directly from James for at least a period of a few months prior to the commencement of this action. See Purnell v. Atkinson, 248 Ark. 401, 451 S.W. 2d 734; Corning Roller Mills v. William Kelly Co., 159 Ark 1, 250 S..W. 895. We cannot say that the chancellor’s finding that an assignment of the lease had been made to James by Nelson and ratified by Van Bibber is clearly against the preponderance of the evidence. Our conclusion on this point also disposes of the appellants’ argument that the chancellor erred in ruling that the condemned property was subject to a leasehold interest. We, of course, have held that a lessee of condemned property is entitled to damages for the value of his leasehold interest separate and apart from the lessor’s reversionary interest. Ark. State Highway Comm’n. v. Polk, 250 Ark. 377, 465 S. W. 2d 671.

Urban Renewal argues that the formula used in determining the damages to the leasehold in this case was not a proper approach and constituted an error of law. It argues that the amount awarded was not supported by substantial evidence and it cites Ark. State Highway Comm’n v. Fox, 230 Ark. 287, 322 S.W. 2d 81; and Hot Spring County v. Crawford, 229 Ark. 518, 316 S.W. 2d 834, in support of this argument. In the Fox case the lessee’s monthly average sale of gasoline at one cent a gallon was admitted in evidence as going to show that his lease was a very valuable one. The trial court in that case went further and allowed $1,000 damages to filling station equipment or for relocating the equipment and this was what we held to be error.

In the Crawford case, supra, a highway was widened between the Crawford’s home and their truck stop cafe and the grade was lowered in the process. As one method of establishing the taking of the land and the lands remaining, the Crawfords were allowed to show that their net profits from the operation of the cafe were $4,000 per year and this net profit per annum was capitalized in arriving at the determination of damages. That case is distinguishable from the case at bar in that the market value of the property taken was the measure of damages in the Crawford case and this amounted to the difference in the before and after taking value. A footnote in Crawford calls attention to an annotation in 154 ALR 1125 and in the cited annotation appears the following:

“. . . it seems proper to draw a distinction between income which represents the profits earned by a business conducted on the land in question (which would, of course, be attributable in many instances not only to the property itself but also to such other considerations as market conditions, the skill and knowledge of the proprietor of the business, etc.) and income which is attributable solely or primarily to the use of the property itself, such as rents.”

In Crawford we cited with approval from the Colorado case of Denver v. Quick, 113 P. 2d 999. In that case the City of Denver condemned and took 800 acres of agricultural land leaving a residue of 160 acres. Evidence as to the income from the sale of cattle and dairy products was admitted and in discussing the city’s contention that the evidence as to profits was not admissible in that case, the court said:

“The city asserts that the reception of this testimony was violative of the general rule, that evidence of profits derived from a business located on the land taken is not properly admissible as a basis for computing the market value of such property in condemnation proceedings .... The fallacy of the argument on behalf of the city on this point does not lie in the rule itself, which, it is stated in American Jurisprudence, supra, has been followed with remarkable unanimity in American jurisdictions, but emanates from its inapplicability to the situation under consideration. This misconception, in our view, arises from the city’s failure to distinguish between income from property and income from business conducted upon the property, which distinction furnishes the criterion for the applicability of the rule.”

The case of Housing Authority of L. R. v. Rochelle, 249 Ark. 524, 459 S.W. 2d 794, is more in point with the case at bar and in Rochelle we said:

“Capitalization of income is a recognized method of arriving at the fair market value of real estate used to produce rental income, in determining just compensation in eminent domain cases. We have long held evidence of rental value to be admissible as a factor to be considered in determining just compensation.”

As to this'point in the case at bar, we are dealing with the value of a lease rather than the before and after value of the property. In Rochelle, supra, in distinguishing that case from Hot Spring County v. Crawford, supra, we strongly implied that this method (capitalization of income) is acceptable when the income of the property consists only of rent.

Jack Farris testified as an expert witness (his qualifications as such having been stipulated to by the parties) that in arriving at the value of the leasehold in this case he used a percentage of the gross sales made by the lessee on the property. This witness testified that the rental value of such businesses as restaurants, drive-ins, etc. is generally recognized in the locality as running from six to 10%, and that he considered 8% as proper in this case. As to the qualifications of Jim Hood, Frank Ashcraft, W. H. Pitcock and Jack Farris as expert witnesses, they were qualified to the satisfaction of the trial court on direct examination and the question directed to them on cross-examination only went to their qualifications as expert appraisers rather than to the basis for the appraisals they made.

In Ark. Land & Cattle v. Anderson-Tully, 248 Ark. 495, 452 S.W. 2d 652, we said:

“It is argued that the witness lacked the necessary education, training and other qualifications to make his opinion evidence on the issues in the case admissible. Determination whether an expert witness is sufficiently qualified lies within the sound judicial discretion of the trial judge. Ratton v. Busby, 230 Ark. 667, 326 S.W. 2d 889. This court will only reverse the decision of a trial judge on this determination in extreme cases where there is manifest error or a clear abuse of discretion. Keeton v. Bozark, 232 Ark. 588, 339 S.W. 2d 123; Arkansas-Louisiana Gas Co. v. Maxey, 245 Ark. 15, 430 S.W. 2d 866. We find no such abuse of discretion here.”

Also in Ark. State Highway Comm’n v. Watson, 248 Ark. 422, 451 S.W. 2d 741, we said:

“The pertinent rule is well stated in 5 Nichols, Eminent Domain, § 18.42:
‘While dealers in real estate, local officials and other witnesses who are supposed to have a special science and skill in appraising real estate are commonly spoken of as ‘real estate experts,’ they are not expert witnesses in the narrower meaning of the phrase. In other words, the general skill and knowledge of his subject which such a witness is supposed to possess is not in itself enough to qualify him to give an opinion of value in an eminent domain proceeding. He must, in addition to such general knowledge, be acquainted with values in the vicinity of the land in controversy, and he must be familiar with the property itself, or at least have examined it at or about the time of the taking.”

The appellant Urban Renewal Agency has not pointed out in any specific respects how the chancellor abused his discretion in allowing the above named witnesses to testify as experts.

Mr. George Fox was an expert appraiser who testified for Urban Renewal in this case. He testified that he did appraisals over the entire State of Arkansas, the eastern half of Oklahoma, and some in Texas. He testified that he makes anywhere from 100 to 500 appraisals each year primarily for corporate clients including practically everybody in the United States including International Paper Company, Shell Oil Company, Humble Oil, Texaco, Gulf, Sinclair, Mobile, Union, and Citgo. He testified that he works regularly for the Rock Island and the Missouri Pacific Railroads and for Worthen Bank; that he has worked for Pulaski Federal Savings 8c Loan, for Federal Home Loan Bank Board in Little Rock; for Searcy Federal Savings 8c Loan and for Lakeside Country Club. He said he has also worked for the United States Forest Service at Russell-ville and Hot Springs; has worked regularly for the Arkansas Game and Fish Commission; has worked for Urban Renewal at Morrilton and Little Rock and he said he has worked regularly for Alcoa, Reynolds Metals, Horn-equity, Honeywell, Royal Typewriter, Western Electric, Southwestern Bell, etc. Mr. Fox testified that in his opinion the total value of the land and building taken was $40,000.

The appellant North Little Rock Urban Renewal Agency argues that its witness Mr. Fox was a higher qualified expert than the witnesses who testified for the property owners and that his testimony should have been accepted and considered by the chancellor as the only expert testimony before the court.

All the expert witnesses in this case, including Mr. Fox, testified that they used cost approach method, the market data approach method and the income approach method in arriving at their opinions. We are unable to say that the chancellor abused his discretion in not discarding the testimony of Jim Hood, Frank Ashcraft, W. H. Pitcock and Jack Farris as expert in favor of the testimony of Mr. Fox. The chancellor had all the witnesses before him as they testified and he was in a better position to judge their qualifications as experts as well as the credibility of their testimony than we are on appeal. The question before us on this appeal is not whether we would have made the same findings and awards as the chancellor made had we been sitting in his place at the trial, but the question before us on this appeal is whether the findings and awards the chancellor did make were clearly against the preponderance of the evidence.

What we have already said also disposes of Nelson’s point on appeal. In anticipation of the possibility that Urban Renewal would take the property under eminent domain, Nelson gave James the option of: (1) Canceling the contract of purchase in which event Nelson would look to Urban Renewal for his damages; or (2) James could abide by and perform the terms of the contract of purchase in which event Nelson would receive the full amount of the sale price from James, and James would look to Urban Renewal for such damages as he might sustain because of the taking. James elected to proceed under the second option.

We are unable to say that the chancellor’s findings, and the decree based thereon, are against the preponderance óf the evidence.

The decree is affirmed.

Fogleman, J., concurs in the result.


source: Caselaw Access Project

license: Public Domain

text:
    TRI-STATE INSURANCE COMPANY v. John McCRAW, D/B/A/ O & M Lumber Company
    5-5995
    483 S.W. 2d 212
    Opinion delivered July 24, 1972

      Daily, West, Core ir Coffman, for appellant.

      WaylandA. Parker, Donald Poe and Donald Goodner, for appellee.
   J. Fred Jones, Justice.

This is an appeal by Tri-State Insurance Company from a judgment of the Scott County Circuit Court in favor of the plaintiff-appellee, John McCraw, d/b/a O & M Lumber Company. The suit was filed by McCraw on an insurance policy issued by Tri-State insuring a truck and trailer belonging to McCraw against loss in damage by collision or upset.

On January 12, 1971, McCraw filed his complaint alleging that on or about September 1, 1970, he sustained damages and losses to his 1964 Mack truck-tractor and 1966 Delta Float semitrailer by collision or upset within the coverage provisions of his insurance policy issued by Tri-State. He alleged damage to his truck in the amount of $8,425 and to the semitrailer in the amount of $1,560. The complaint alleged post-wreck salvage value of the truck in the amount of $1,075 and salvage value to the semitrailer in the amount of $940. The complaint alleged that demand had been made upon Tri-State and that TriState denied liability under its policy.

On March 15,1971, Tri-State filed its answer admitting issuance and coverage under the policy but alleging that the benefits available to the plaintiff under the provisions of the policy amounted to $5,250 for the damage to the truck-tractor and $770.68 for the damage to the semitrailer. Tri-State alleged that it had offered these amounts to Mr. McCraw in settlement of his claims and in the alternative had offered to have the trailer repaired in such manner as to restore it to its full market value which it had immediately prior to the accident, less $250 deductible as provided in the policy, but that these offers were refused by McCraw. By amendment to its answer filed on October 27, 1971, Tri-State alleged that during the month of October, 1970, it offered to furnish McCraw a replacement substitute truck-tractor which was then available; that the substitute tractor was still under warranty and was in better condition than was the insured vehicle before it was wrecked; that the proposed replacement vehicle was then in Joplin, Missouri, and that Tri-State offered to pay McCraw $200 for the expense of transporting the vehicle to Waldron, Arkansas. Tri-State alleged that its offers were made in an effort to fully perform and carry out its obligations under the terms of its contract; that all its offers were refused and that its full performance under its contract was prevented by McCraw’s arbitrary refusal to accept Tri-State’s tendered performance.

A jury trial resulted in a verdict in favor of McCraw for $8,708. Judgment was entered for $8,208 which was the total amount of the jury verdict less $500 deductible under the provisions of the policy. On appeal to this court Tri-State relies on the following points for reversal:

“The court erred in refusing to permit appellant to prove its alternative offers to appellee and/or his attorney to:
(a) Pay the amount of the loss on the trailer in money;
(b) Repair the trailer to its value prior to the damage;
(c) Pay the amount of the loss on the truck in money;
(d) Replace the truck with ‘other of like kind and quality,’
As appellant had a right to do under the policy and as appellant had pleaded in its answer (and amendments) that it had done.” .

The actual controversy in this case concerns the rights and liabilities of the parties to an insurance contract under the provisions of the contract. The primary question on this appeal does not pertain so much to the evidence of offers rejected as it does to the evidence of liability incurred. The pertinent provisions of the insurance contract in this case pertain to Coverage “E” as designated in the policy. Coverage “E” pertáins to collision or upset and under it Tri-State agreed:

“To pay for direct and accidental loss of or damage to the automobile, hereinafter called loss, caused by collision of the automobile with another object or by upset of the automobile, but only for the amount of each such loss in excess of the deductible amount, if any, stated in the declarations as applicable hereto.”

The policy also provided as follows:

“The insurance afforded is only with respect to such and so many of the following coverages as are indicated by a specific premium charge or charges. The limit of the company’s liability against each such coverage shall be as stated herein, subject to all the terms of the policy having reference thereto:
* # *
E. Collision — Actual cash value less $250 deductible. (Emphasis added).

Coverage “E” is again referred to under “Condition” No. 14 of the policy as follows:

“Limit of Liability; Settlement Options; No Abandonment — Coverages D. E. and F: The limit of the company’s liability for loss shall not exceed either (1) the actual cash value of the automobile, or if the loss is of a part thereof the actual cash value of such part, at time of loss or (2) what it would then cost, to repair or replace the automobile or such part thereof with other of like kind and quality, with deduction for depreciation, or (3) the applicable limit of liability stated in the declarations.
The company may pay for the loss in money or may repair or replace the automobile or such part thereof, as aforesaid, or may return any stolen property with payment for any resultant damage thereto at any time before the loss is paid or the property is so replaced, or may take all or such part of the automobile at the agreed or appraised value but there shall be no abandonment to the company.” (Emphasis added).

Mr. McCraw testified that he purchased the truck-tractor in 1964 for between $20,000 and $21,000 and purchased the trailer in 1966 for $3,850. He testified that he had approximately $5,000 worth of repairs done on the truck shortly before it was wrecked. He testified that the fair market value of his truck prior to the accident was not less than $9,500, and the fair market value of his trailer prior to the accident was $2,500. He testified that after the accident the truck-tractor was worth around $1,000, and his semitrailer was worth about $900. He testified that he had purchased and paid for the insurance policy from TriState and was only asking the jury to require Tri-State to live up to its end of the bargain and to pay him the amount of damages he sustained to his vehicles in the amount of $9,985. He testified that he was asking a money judgment for the damage to his vehicles and that he intended to keep the damaged vehicles for salvage. Mr. McCraw testified that he still owed approximately $8,500 on the purchase price and former repairs of the two pieces of equipment.

Mr. Carl Corley, president and general manager of the Crouch Equipment Company, testified as an expert that the truck-tractor was worth $9,500 prior to the wreck and the trailer was worth $2,500. He testified that after the wreck the tractor was purely salvage and worth approximately $750. He said that the value of the trailer after the wreck was $500. Mr. Corley testified that there was still an indebtedness of between $8,500 and $8,750 due the Crouch Equipment Company for which it had a security interest in the property involved and for which it was also insured under McCraw’s policy with Tri-State.

Mr. Doek Lipe, a material damage appraiser employed by the Appraisal Service of Arkansas, testified as an expert for Tri-State. He testified that he examined the equipment involved in this case; that in his opinion the trailer was capable of being repaired and that he estimated that such repairs to the trailer would cost $1,020.68 to restore it to its original condition and value prior to the accident. He testified that in his opinion the fair market value of the trailer prior to the accident was $2,580 and that its value immediately after the accident was $1,559.32 which constituted its fair market value in its damaged condition. This witness testified that when he examined the truck-tractor following the wreck, he concluded that the cost of its repairs would exceed its value, so he considered the vehicle a total loss because of the damage. He estimated the cost of repairing the truck-tractor at $8,454.91. He testified that in his opinion the truck was worth $4,590 immediately prior to the accident and that its salvage value was about $1,000 after the accident.

Mr. Richard L. Williams, a claims adjuster for TriState, testified that he employed Mr. Lipe to make the estimates to which Mr. Lipe testified. He testified that Mr. Lipe conveyed the results of his inspection, appraisals, estimates and opinions to him and he in turn conveyed the information to Mr. McCraw. He testified that Mr. Lipe had advised him that the trailer could be repaired for $1,020.68 and that the tractor was a total loss.

Mr. D. J. Wharton, a professional insurance claims man and expert appraiser employed by Insurance Services of Kansas City, Missouri, testified that he travels over the entire United States in estimating damages to large diesel tractor-rigs. He said that his usual duties consist of evaluating damages and settling claims on truck-tractors and trailers as well as cargo. He said that this work.involves, the repair as well as cost of replacement of damaged vehicles and parts, and that approximately 50% of his business involves replacement. He testified that the procedure he follows in replacing a unit is to establish its value by like kind and quality as near as practicable and then locating a comparable unit. He said that the comparable unit is then made available and it is optional with the owner whether he accepts the comparable unit or desires a cash settlement to go into a later model. This witness testified that on October 5, 1970, he received an assignment from Tri-State in connection with the loss involved in this case and that he followed his usual procedure. He testified he was advised that Mr. McCraw was represented by counsel and that he made several attempts to get in touch with Mr. McCraw’s attorney before finally doing so and arranging an appointment to discuss.the matter on October 13, 1970. He testified ■ that he inspected the damaged equipment in Waldrón and concluded that the fair market value of the trailer prior to the accident would have been between $2,200 and $2,500, and that the fair market value of the truck-tractor prior to the accident would have been $5,350. He said that the fair market value of the truck following the accident was $1,675. He also testified that it would cost in excess of $8,000 to repair the truck-tractor and that this amount was in excess of its actual value or the value of another truck of similar design and condition. This witness was then asked a question followed by a comment from the court as follows:

“Q. Did you make an effort to obtain or locate a unit of like kind and quality?
THE COURT: No, sir, that isn’t admissible.”

At conference in chambers, out of the hearing of the jury, Tri-State offered to prove by Mr. Wharton that Tri-State had located a Mack truck in Joplin, Missouri, of equal or better quality and value than the insured truck prior to damage; that the truck in Joplin could be obtained for a quoted price of $5,350 f. o. b. Joplin, and the expense of bringing the truck to waldron, Arkansas, would be approximately $150.

Tri-State then proffered the testimony of Mr. Wharton to the effect that Wharton had a limited discussion with Mr. Poe and Mr. McCraw in Mr. Poe’s office in Waldron, at which time he offered to replace the insured truck-tractor with one of higher quality and value which was available in Joplin, Missouri, for $5,350. This testimony was held inadmissible by the trial court.

Mr. McCraw was claiming no penalty because of TriState’s failure to timely perform under its contract in this case so the trial court did not err in excluding the evidence as to offers made by Tri-State and rejected by McCraw. The specific problem in this case, however, is pointed up in the record by the following colloquy between the attorneys and the court.

“THE COURT: I am holding that the measure of damage in this case is the difference between the value of the vehicle and trailer immediately before the accident, and the value immediately after the accident, and the difference between those figures is what the jury will be instructed on. Mr. Core takes the possition in representing the defendant they had a right to replace the trunk under the terms of the policy with a similar truck of like kind and quality at a lesser sum that the before and after value.
MR. POE: He never did offer that proposition, either to me or to Mr. McCraw.
THE COURT: He’s not saying they did. This is a matter of law, what he is questioning.
MR. POE: And they denied liability, and—
THE COURT: That’s not what he’s questioning. He’s trying to show that the policy itself doesn’t provide for damages for the before and after value — that it provides for replacement with like kind and quality —which I hold is contrary to Arkansas law.”

Tri-State argues that the trial court erred in refusing to give several instructions requested by Tri-State based on the proffered testimony ruled inadmissible by the trial court. We deem it unnecessary to specifically discuss these offered instructions for the reason that they are not likely to be again offered in the same words and context at a new trial. Tri-State objected to the court’s instructions Nos. 8 and 9 which appear in the record as follows:

“No. 8 When I use the expression ‘fair market value,’ I mean the price that the truck and trailer would bring on the open market in a sale between a seller who is willing to sell, and a buyer who is willing and able to buy after a reasonable opportunity for negotiations.
No. 9 The meaning of damages in this case is the difference in the fair market value of the truck and trailer immediately before and immediately after the occurrence. In determining the difference, you may take into consideration the reasonable cost of repairs. Whether the damage has been proved by the evidence is for you to determine.
The court then gave its instruction No. 7 as follows:
“If you decide for the plaintiff, John McCraw, d/b/a O & M Lumber Company, and against Tri-State Insurance Company, you must then fix the amount of money which will necessarily and fairly compensate him for the damages he sustained.”

Following the return of the jury verdict in this case, Tri-State moved for a judgment n.o.v. in favor of McCraw in the amount of $4,925 which motion was denied by the trial court.

We are of the opinion that the trial court erred in not permitting Tri-State to submit proof to the jury as to replacement values and in not instructing the jury in connection therewith. The trial court was apparently of the impression that Tri-State was contending that its policy did not provide for the payment of damages based on the before and after value of damaged property but only provided for replacement with property of like kind and quality. We do not so constru Tri-State’s contentions from the record before us. It is Tri-State’s contention, as we understand it, that its top liability under the terms of its policy was limited to the actual cash value of the insured vehicles under item 8E of the contract; that it was only obligated to pay the amount of the loss in excess of the $250 deductible on each vehicle as provided under “Coverage E” of the insuring agreement, and that Tri-State had an option to pay for the loss in money or to repair or replace the damaged vehicle under Condition No. 14 of the policy.

We agree with Tri-State on this point. This case involves a suit on contract and not in tort so we are of the opinion that the amount Tri-State was obligated to pay and the amount Mr. McCraw was entitled to recieve, were dependent on the terms of the contract rather than, solely on the difference in the before and after value of the vehicles. We hold, therefore, that the trial court erred in restricting the evidence to the difference in the market value of the vehicles immediately prior and immediately following the damage they sustained.

As already stated, the measure of Tri-State’s contractual liability was the matter actually involved in this case rather than the true measure of damage to the insured vehicles. Under declaration No. 8 in the policy, the insurance contract provides: “the limit of the company’s liability against each such coverage shall be as stated herein, subject to all the terms of the policy having reference thereto.” Under coverage “E” the policy provides that the limits of liability shall be “actual cash value less $250.00 deductible.” We point out that the limits of liability as above emphasized states “actual cash value” and does not state “actual value in cash.” Under insuring agreements of the policy, coverage “E” is again referred to and provides payment for the direct or accidental loss of or damage to the insured vehicle caused by collision or upset, but only for the amount of each loss in excess of the deductible amounts stated in the declaration.

Condition No. 14 first restates the limits of the company’s liability not to exceed “the actual cash value of the automobile. . . at the time of the loss,” or “what it would then cost to repair or replace the automobile or such part thereof with other of like kind and quality with deduction for depreciation,” or “the applicable limit or liability stated in the declarations” (actual cash value less $250 deductible). All of these provisions refer to the limits of liability and no one suggests in this case that the provisions of the policy are conflicting or ambiguous. The second paragraph of 14 provides for options available to TriState in paying or satisfying the limits of its liability. This paragraph provides in very plain language:

“The company may pay for the loss in money or may repair or replace the automobile or such part thereof . . .”

We have never held such limitations by contract invalid in Arkansas, but on the contrary have recognized them as valid. Resolute Ins. Co. v. Bailey, 221 Ark. 419, 253 S.W. 2d 771; Resolute Ins. Co. v. Mize, 221 Ark. 705, 255 S.W. 2d 682. In Traders & General Ins. Co. v. Williams, 229 Ark. 923, 319 S.W. 2d 847, we said:

“The appellant insists that all the evidence of value before and after the collision was inadmissible and prejudicial; but we do not agree with such contention. The Insurance Company delivered to Williams a policy which stated in the coverage section as regards collosion, ‘. . .to pay for loss caused by collision to the owned automobile .. . but only for the amount of each such loss in excess of the deductible amount stated in the declarations as applicable hereto.’ (The deductible amount was stated at $50.00.) So, in the light of the above quoted section, the Insurance Company was liable for all collision loss in excess of $50.00. What was the loss? Unless otherwise limited, it was the difference in value before and after the collision. But in another section of the policy the Insurance Company had limited its liability as regards collision loss to, ‘ . . . what it would then cost to repair or replace the property or such part thereof with other of like kind and quality. . .’
When we consider together these two sections of the policy, it is clear that Williams was entitled to show (a) his loss by the ‘before and after’ value rule; and then (b) to completely establish that his loss was within the limit of liability he could show the cost of repairs. There was certainly no error in allowing the evidence offered; and the instruction given by the Trial Court at the request of the defendant made the point clear.”

See footnote 4 to this opinion. See also Southern Farm Bureau Cas. Ins. Co v. Gaither, 238 Ark. 50, 378 S.W. 2d 211.

We conclude, therefore, that the trial court should have permitted Tri-State to offer evidence as to the cost of replacing the damaged truck with one of like quality and should have submitted the question to the jury under proper instructions.

The judgment is reversed and this cause remanded for a new trial.


author: J. Fred Jones Justice.

text:
    Hal MILLSAP Jr and Frances Aileen MILLSAP v. UNITED TELEPHONE COMPANY of Arkansas
    5-5990
    482 S.W. 2d 813
    Opinion delivered July 24, 1972

      Warren ir Bullion, for appellants.

      Russell Elrod, for appellee.
   J. Fred Jones Justice.

This is an appeal by Hal Mill-sap, Jr. and Frances Millsap, his wife, from a decree of the Benton County Chancery Court wherein, upon petition of United Telephone Company of Arkansas, the Mill-saps were restrained and enjoined from interfering with the construction of a telephone line along the right-of-way of North Dogwood Street in the City of Siloam Springs, Arkansas, and the counter petition of the Millsaps for damages was dismissed.

Mr. and Mrs. Millsap have designated four points upon which they rely for reversal, but as we view this case the real question before the chancellor was whether the telephone line was being erected inside or outside the right-of-way boundary of Dogwood Street, and the real question before us on appeal is whether the chancellor’s finding and decree that the area involved is inside the street right-of-way are against the preponderance of the evidence.

It appears from the record before us that Dogwood Street was originally a public road running north and south and had been so used and considered for many years. The westernmost city limits of Siloam Springs extend to the center of Dogwood Street, but the area involved has never been platted into city blocks and lots. Mr. and Mrs. Millsap purchased property on the east side of Dogwood Street and took title by separate warranty deeds dated January 26, and February 8, 1965, under descriptions as follows:

“S'/2 of NWW of NEW of SEW of Sec. 36, Twp. 18 N., Rge. 34W, containing 5 acres, more or less.”
“Part of NW of NWW of NEW of SEW of Sec. 36, Twp. 18 N. Rge. 34 W., described as beginning at the Southwest corner of the tract, thence north 66 feet, thence east 660 feet, thence South 66 feet, thence west 660 feet to the point of beginning containing 1 acre more or less.”

Mr. and Mrs. Millsap had an abstract of title to the property examined by their attorney and by letter dated January 29, 1965, the attorney advised as follows:

“You should further satisfy yourself as to the boundary lines of said lands, and as to the rights of any person who may be in possession of any part of said lands other than the above named record owners.
If located in the city limits, then the lands would be subject to zoning ordinances of the City of Siloam Springs, Arkansas, which are not covered by the abstract of title.”

On February 6, 1965, Mr. and Mrs. Millsap had their property surveyed by a professional civil engineer. The engineer prepared and furnished to the Millsaps a plat of his survey showing a 60 foot right-of-way for North Dogwood Street with the Millsaps’ true west property line designated as 30 feet from the center of Dogwood Street. The plat, as certified by the surveyor on February 6, 1965, after describing the land surveyed, states:

“Containing 5.73 acres more or less. (Note: 6.00 acres less 30.0 feet along west side for one-half of street right-of-way).”

A copy of this plat was placed of record in the office of the circuit clerk and recorder of Benton County on July 8, 1965, but no one seems to know who filed the plat for record. As above stated, the engineer who prepared the plat certified thereon that the survey was made on February 6, 1965, so it would appear that at the time the Millsaps purchased their property they were advised by their attorney to satisfy themselves as to the boundary lines of the property, and they were advised by their surveyor or engineer that the total of six acres more or less as described in their deeds was actually 5.73 acres more or less because of the 30 feet off the west side of the property for one-half of the 60 foot right-of-way for North Dogwood Street.

The appellee telephone company pays an annual fee to the City of Siloam Springs for the privilege of erecting and maintaining its telephone lines on the street rights-of-way in the city. The litigation in this case arose when the telephone company started erecting its telephone line along the east side of North Dogwood Street and started cutting trees and brush claimed by the Millsaps as belonging to them. Mr. Millsap demanded that the telephone company remove its poles and equipment from the area involved, whereupon the company obtained a temporary restraining order against the Millsaps. In response to the company’s petition for the permanent restraining order and injunction, Mr. and Mrs. Millsap filed an answer and cross complaint denying the company’s right to construct its telephone line on the area involved, and prayed treble damages for wrongful destruction of the trees along the right-of-way.

There is considerable testimony in the record as to permission requested by the telephone company and granted or refused by the Millsaps for the cutting of the brush and trees along the right-of-way. Witnesses for the telephone company testified that as a matter of courtesy their contractor pointed out to Mrs. Millsap the trees that would have to be cut, and that Mrs. Millsap agreed to the cutting of the trees without the necessity of talking with Mr. Millsap. Mr. and Mrs. Millsap denied that either of them agreed to the cutting of the trees and there is no evidence or contention that Mr. Millsap himself ever personally agreed to the cutting of the trees. The evidence is to the effect that when Mr. Millsap learned where the telephone company proposed to erect its line, he requested a conference with the company officials before proceeding with the erection of the line, but that the company completed clearing its right-of-way before the matter was ever discussed with him. The record indicates that when Mr. Millsap found that the right-of-way had been cleared, he demanded that the company remove its poles and equipment from the property, whereupon the company obtained the restraining order above referred to.

Several photographs of the area involved were introduced by both sides and after hearing the evidence the chancellor viewed the property. We are of the opinion that the chancellor’s finding “that the telephone poles and lines of the plaintiff are within the boundaries of North Dogwood Street, Siloam Springs, Arkansas,” is not against the preponderance of the evidence, so we find it unnecessary to discuss the testimony of the various witnesses concerning the elements of damage and value of the trees as well as the various discussions the parties had with each other.

It is quite clear from the evidence of record that a public right-of-way over North Dogwood Street has been well established by constant public use for many years. The only question in connection with the right-of-way easement is the width of it.

The appellants cite our decisions in Craig v. O’Bryan, 227 Ark. 681, 301 S.W. 2d 18 and Southwestern Bell Telephone Co. v. Davis, 247 Ark. 381, 445 S.W. 2d 505, as calling for a reversal in this case, but the O’Bryan and the Davis cases are distinguishable on their facts from the case at bar. In O’Bryan the controversy was between two individuals over the use and maintenance of the traveled portion of a roadway, and the width of a right-of-way, or right-of-way easement was not involved.

In Davis a 12 foot public road had been widened to 24 feet and a county employee was injured when a road grader he was operating struck an obstruction (a baffle) placed by the telephone company on its easement. In a personal injury suit filed against the telephone company, the company defended on the ground that the injured county employee was trespassing on the telephone company’s easement and we agreed with the telephone company.

The primary distinction between the Davis case and the case at bar was stated in Davis in the following language:

“The width of the public road before or after enlargement, viewed most favorably to the appellee, never extended closer than 4.4 feet to the baffle on appellant’s property or easement.”

In neither O’Bryan or Davis were there fences or other monuments marking or indicating an acceptance of a specific easement boundary line as is the situation in the case at bar.

In 39 C. J. S., § 20, in connection with width and extent of highways generally, is found the following:

“An important element in determining the width of a highway by prescription is the recognition of the limits of the way by persons whose lands front there.on, as indicated by the monuments and fences which they themselves place upon the ground, and the lines which they fix for the same in making conveyances of their property.”

In 39 Am. Jur. 2d, § 52, Highways, Streets, and Bridges is found the following:

“Ditches along the side of a highway acquired by prescription or user are generally regarded as within the boundaries of the highway. Fences, walls, or other monuments erected along the sides of such a highway by the adjoing owners are frequently regarded as determining its boundaries, in some instances the courts pointing out that the owners had recognized and accepted the fence, wall, or other monument as marking the boundary.”

In the case at bar the testimony indicates, and exhibits confirm, that the telephone poles erected, and to be erected, are within a few feet of the traveled surface of the street and several feet distant from the fee simple property line as designated on the surveyor’s plat furnished to Mr. and Mrs. Millsap. It is rather clear from the evidence of record that the property north and south of the Millsap property is owned by separate individuals who have enclosed their property under fence and their fences if extended along the Millsap property, would coincide with the surveyor’s plat and confirm the 30 foot right-of-way from the center of the traveled portion of North Dogwood Street. The area from which the trees have been cut and along which the telephone company proposes to erect its line is described in the testimony as a bank or elevated area along the east side of north Dogwood Street, and the defendant’s picture exhibits bear this out. There is no testimony as to how this elevated area originated, but it is not difficult to conclude that it originated from the deposit of dirt and rocks removed from the traveled surface of North Dogwood Street through the many years of maintenance. The logic of such assumption is rather dramatically borne out by defendant’s picture exhibits Nos. 3, 4, 6, 7 and 8 because it is obvious from these exhibits that the timber had once been cleared from this area and permitted to grow up again from the stumps or stools which were not removed. This is especially clear from the defendant’s picture exhibits Nos. 6 and 7 where the multiple growth has been severed from single stumps and these stumps may be easily compared with the single tree growth further east on the Millsaps’ property where there is no evidence that the land has ever been cleared.

In addition to the evident fact that the trees had at one time been cut from the area involved in this case, there is no question that Mr. and Mrs. Millsap were fully advised, by their surveyor when they acquired their land, that a 30 foot right-of-way was being claimed east of the center line of North Dogwood Street. It is admitted by all parties concerned that the land involved in this case is inside the city limits of Siloam Springs and it therefore follows that at least the east half of North Dogwood Street is a city street as distinguished from its original status as a country road.

In Padgett v. Ark. Power & Light Co., 226 Ark. 409, 290 S. W. 2d 426, we said:

“There is a generally recognized distinction between a highway in the country and a street in a municipality, as to the mode and extent of the use and enjoyment, and, consequently, as to the extent of the servitude in the land upon which they are located, the urban servitude being much more comprehensive than the rural. Streets within the limits of municipal corporations'are subject to many uses by the public to which highways in the country are not subject. Moreover, as a village grows into a town and the town grows into a city, the rights of the public in its streets are correspondingly broadened. As a rule, country highways are needed only for the purpose of passing and repassing, and, subject to some exceptions, the rights of the public and of the authorities in charge are confined to the use of the surface, with such rights incidental thereto as are essential to such use. Streets, however, may be used for many purposes other than travel, such as construction of sewers and drains, the laying of gas and water pipes, the erection of telegraph, telephone and electrical power lines, and a variety of other improvements, beneath, upon, and above the surface, to which in modem times they have been subjected.”

We find that the chancellor’s decree is not against the preponderance of the evidence in this case, so the decree is affirmed.

Affirmed.


text:
    CITY of CORNING, Arkansas v. Leon WATSON
    5-6007
    482 S.W. 2d 797
    Opinion delivered July 24 1972

      Bryan J. McCallen, for appellant.

      Burris & Berry, for appellee.
   J. Fred Jones Justice.

This is an appeal by the City of Corning, Arkansas, from a decree of the Clay County Chancery Court in favor of the appellee, Leon Watson, in which a zoning ordinance of the City of Corning was found and decreed by the chancellor to be void and of no effect. The appellant relies on the following points for reversal:

"The trial court erred in finding that the planning commission of the City of Corning, Arkansas, did not duly adopt and refer a preposed zoning ordinance to the legislative body of the city.
The trial court erred in finding that the city council of the City of Corning, Arkansas, did not adopt a zoning ordinance, consisting of a text and a map, as recommended by its planning commission.
The trial court erred in finding that the text and map of plaintiff’s zoning ordinance were not properly filed and authenticated.
City ordinance No. 6805 was duly published as required by law and by section 19-2404 of the 1968 Replacement of Arkansas Statutes Annotated of 1947. The facts of the case warrant the injunctive relief prayed for by plaintiff.”

The litigation in this case arose when the appellee, Leon Watson, applied for and obtained a building permit for the erection of a residential building on some lots he owned in Corning. Mr. Watson started immediate construction of his building but an error in issuing the permit was immediately discovered in city hall, and Mr. Watson was advised that his property was in a commercial zone rather than residential. He was advised the permit was being canceled and his permit fee refunded. Mr. Watson continued with the construction of his building until the City of Corning filed its complaint in this case praying an order enjoining Watson from proceeding further in the erection of the house and for removal of that portion of the building already constructed.

Watson answered by general denial and with an attack upon the validity of Municipal Ordinance No. 6805 whereby the City of Corning attempted to zone the city into use districts. Watson alleged that the purported ordinance was not published in form and manner required by law, specifically as required by Ark. Stat. Ann. § 19-2404 (Repl. 1968), and that the purported zoning code for the City of Corning had not been printed as a code in book form as required by the aforesaid section.

The chancellor decreed that the purported zoning ordinance No. 6805 was invalid and of no effect. He based the decree on his findings as follows:

. and then it [referring to ordinance No. 6805] goes on to say, ‘Be it ordained by the City Council of the City of Corning, Arkansas, and publishes a proposed Ordinance, Section 1, Section 2 and Section 3. And in Section 1, it states, ‘Zoning Regulations. That the zoning regulations for the City of Corning, Arkansas, prepared by the Corning-Kilgore Area Planning Commission and adopted by it on August 28,1967, are hereby adopted. Three copies of the zoning regulations above referred to are on file in the office of the City Clerk and are available for public inspection.’ Section 2 is in regard to the penalty for violation of the Ordinance and Section 3 has reference to the emergency clause. According to the testimony here, in Plaintiff’s Exhibit 2, which appears to be a mimeographed copy of Zoning Regulations, Corning, Arkansas, prepared for the City of Corning, Kilgore Township Joint Planning Commission by City Planning Division, University of Arkansas, Fayetteville, Arkansas. There is nothing, Gentlemen, in the record, to show me the Planning Commission ever prepared any sort of Zoning Regulations at all. The testimony I have here is that after this meeting at the City Hall, apparently at the time they attempted or did pass this Ordinance 6805, the Ordinance 6805 says they adopted a zoning regulation that was prepared by the Corning-Kilgore area Planning Commission. There is nothing here that they adopted the Zoning Regulations that were prepared by the University of Arkansas at all, it just assumed that that was the regulations that the City Planning Commission attempted to adopt themselves, but there is nothing in the record here to show where the city Planning Commission adopted anything as far as I can tell. Also, just assume, for the sake of argument, that the City Planning Commission did adopt the regulations as prepared by the University of Arkansas, in thumbing through it here, I gather that what was prepared by the University of Arkansas was more or less guide lines as to how this Zoning Ordinance should be prepared. On page 4 in this exhibit, Plaintiff’s Exhibit 2, you find Section 3 which says, ‘Establishment of Districts and Map’ and it goes ahead and sets out the following, ‘The following Districts are hereby established’ of R-Residential. C-l Central Business District. C-2 General Commercial and I-Industrial. Section 3.2 under that, ‘Zoning Map Established.’ And states that, ‘Such land and the district classification thereof shall be on the map designated as the ‘Zoning Map of Corning, Arkansas, ‘Dated and signed by the Mayor. I would assume if this is what the Planning Commission adopted, there is nothing in this record at all to show that the Planning Commission ever adopted a Zoning Map or there is nothing in this record to show that the City Council of Corning ever adopted any zoning or planning map at all. I have a map here that has been presented to me here that they found in the City Clerk’s Office down there but there is nothing to indicate on that map, that map was ever a part of the Ordinance or ever adopted by the City Council, and, I am not sure, but I don’t believe there was even any endorsement on it showing the date or whether or not it was ever authenticated by even the Mayor of the City of Corning.”

From the record before us in this case we are unable to say that the chancellor’s findings and decree are against the preponderance of the evidence. Ark. Stat. Ann. § 19-2404 (Repl. 1968) provides as follows:

"All by-laws or ordinances after their passage shall be recorded in a book kept for that purpose and shall be authenticated by the signature of the presiding officer of the governing body and the clerk or recorder, and all by-laws or ordinances of a general or permanent nature and all those imposing any fine, penalty or forfeiture shall be published in some newspaper of general circulation in the corporation; provided, in incorporated towns where no newspaper is published, written or printed notice posted in five [5] of the most public places in said corporation shall be deemed a sufficient publication of any law or ordinance for incorporated towns, and it shall be deemed a sufficient defense to any suit or prosecution of such fine, penalty or forfeiture to show that no such publication was made. Provided, further, that ordinances establishing rules and regulations for zoning, construction of buildings, the installation of plumbing, the installation of electric wiring or other similar work where such rules and 'regulations have been printed as a code in book form, such code or provisions thereof may be published by such municipality by reference to title of said code without further publication or posting thereof; provided, however, that not less than three [3] copies of such code shall be filed for use and examination by the public in the office of the city clerk or recorder of such municipality subsequent to the adoption thereof.”

Under Ark. Stat. Ann.§§ 19-2801-19-2833 (Repl. 1968) municipal corporations are authorized to adopt and enforce building and zoning regulations and in connection therewith §§ 19-2825 — 19-2829 provide for municipal planning, adoption of plans and the creation, organization and functions of planning commissions with authority to prepare plans and recommendations for building and zoning regulations to be adopted by municipalities. When such plans are worked out by a planning commission and are to be adopted by a city, § 19-2830 provides as follows:

“a. PROCEDURE FOR ADOPTION AND FILING. All Plans, recommended ordinances, and regulations shall be adopted through the following procedure:
(1) The planning commission shall hold a public hearing on a plan or plans, ordinances and rep-nlations proposed under this Act [§§ 19-2825 — 19-2831]. Notice of public hearing shall be published in a newspaper of general circulation in the city, at least one [1] time fifteen (15) days prior to the hearing.
(2) Following public hearing proposed plans may be adopted and proposed ordinances and regulations may be recommended as presented or in modified form by a majority vote of the entire planning commission.
(3) Following its adoption of a plan or plans and recommendation of ordinances and regulations, the planning commission shall certify such adopted plan or plans or recommended ordinances and regulations to the legislative body of the city for its adoption.
(4) The legislative body of the city may return the plan or plans and recommended ordinances and regulations to the planning commission for further study or re-certification, or by a majority vote of the entire membership, may by ordinance or resolution adopt plans and recommended ordinances or regulations submitted by the planning commission. However, nothing in this act shall be construed to limit the city council’s authority to recall the said ordinances and resolutions by a vote of a majority of the city council.
(5) Following adoption by the legislative body, the adopted plans, ordinances and regulations shall be filed in the office of the city clerk. The city clerk shall file, with the county recorder of the county or counties in which territorial jurisdiction is being exercised, such plans, ordinances and regulations as pertain to the territory beyond the corporate limits.
b. PROCEDURE AND AMENDMENTS. After adoption of plans and ordinances and regulations, and proper filing in the offices of city clerk and county recorder, no alteration, amendment, extension, abridgement. or discontinuance of the plans or ordinances may be made except in conformance with the above precedure, or by a majority vote of the city council.
c. CONFORMANCE TO ACT BY EXISTING COMMISSION. All plans, ordinances and regulations or amendments thereto shall comply witn tne provisions of this Act. Nothing in this Act shall invalidate any plans, ordinances or regulations duly adopted in accordance with the statutes in effect at the time of adoption. ' No alteration or amendments may be made to said plans, ordinances and regulations, unless in conformity with the provisions of this Act.”

Mr. Ben Baker testified that he is an abstracter of land titles and is a member of the city council of Corning. He stated that he had also served on the city planning commission. He testified that he was a member of the planning commission when public hearings were had in connection with city zoning. He testified that he specifically remembers attending a planning commission meeting pursuant to public notice when no one showed up at the meeting and after staying about 30 minutes the meeting was adjourned. He then testified as follows:

“Q. Can you tell the court whether proposed zoning ordinance codes and maps were adopted by the Planning Commission at that time?
A. It has been a long time ago and I don’t know exactly when they were adopted, whether they were actually adopted at that meeting or whether they were adopted prior to that and that meeting was held for anyone who had objections to them. We were working under the direction of the University of Arkansas and there was a fellow in here helping us at that time and it has been quite a while ago and my memory is a little vague on it but the best I remember, we did adopt them and recommend it to the City Council, did pass an ordinance, etc.
Q. Are you familiar with this plat?
A. Yes, sir.
Q. Is this the map that was adopted at that time for Zoning Districts?
A. Yes, sir.”

On cross-examination Mr. Baker testified that he was secretary of the planning commission and he then testified as follows:

“Q. Did you keep Minutes of the meetings?
A. Yes, sir.
Q. Do you have Minutes of the meetings?
A. I have but I didn’t bring them. I didn’t know I would need them. I don’t have Minutes of the meetings when this ordinance came into existence, I don’t have minutes for those meetings because I was not secretary at the time and all of the minutes were turned over to Mr. Fisk and Mr. Fisk passed away and all the minutes he had was lost, they could not be found. I have them in a rough form, they may not be typed up.
Q. Do you have Minutes that show this meeting of 1967?
A. The open meeting, the one that is published there?
Q. Yes, sir.
A. I do not have the minutes on that because they were turned over to Mr. Fisk.
Q. And they have been lost?”
A. Yes, everything I had, we have not been able to find any of it, the maps and things he had. I turned all of them over to him when he became Secretary and we have never found any of it.”

Mr. Paul Mabry testified that he was city clerk of the City of Corning and had served in that capacity for seven yeras before resigning in 1970. He identified ordinance book No. 2 for the City of Corning and testified that the volume contained two zoning code books. The blue back copy being zoning regulations, and the pink back copy being subdivision regulations. This witness testified as follows:

“Q. How did these two volumes get into the ordinance book if you know?
A. I was requested to put these two volumes in here by the fellow that sent this from the University of Arkansas.”

This witness testified on cross-examination that ordinance No. 6803 re-establishing the planning commission and designating Mr. Baker as a member thereof was passed on the same date as ordinance No. 6805, which was the 11th day of March, 1968. He testified that there was no city seal, or marks of authentication, on any of the instruments or copies testified to by him. Mr. Mabry testified that while he was city clerk of Corning three or four zoning maps were being used. He testified that one of the maps had been authenticated as the official zoning map but that he does not remember whether he put the city seal on it or not. He testified that this map was filed in the circuit clerk’s office, and that he assumes that it is still in that office. He testified that he personally recalls having filed the map in the circuit clerk’s office.

Mr. Denzel Wright, deputy circuit and chancery clerk of Clay County, testified that he had searched the record books containing plats and maps in the circuit clerk’s office and found no record of a zoning plat or map for the City of Corning.

From the overall record before us it would appear that the City of Corning set up a planning commission and with assistance from the University of Arkansas, the commission prepared plans for building and zoning regulations and recommendations for the city, and at this point the thread of events is lost from the record in this case.

Insofar as the record is concerned one could reasonably conclude that the Corning City Council simply lumped the proposed zoning regulations, plans, specifications, recommendations and maps prepared by, or for, the Corning-Kilgore Planning Commission between the pages of municipal ordinance record book No. 2 where is recorded ordinance No. 6805, reciting:

“That the zoning regulations for the City of Corning, Arkansas, prepared by the Corning-Kilgore area Planning Commission and adopted by it on August 28, 1967, after public hearing held on August 28, 1967, are hereby adopted.”

From the overall record before us in this case, we are unable to say that the findings and decree of the chancellor are against the preponderance of the evidence, so we conclude that the decree must be affirmed.

The decree is affirmed.


author: Frank Holt Justice.

text:
    R. B. ALEXANDER v. Mary Lee ALEXANDER
    5-5982
    482 S.W. 2d 818
    Opinion delivered July 24 1972

      Thompson & Thompson, for appellant

      W. J. Walker, for appellee.
   Frank Holt Justice.

This appeal results from a petition for reduction of alimony and is a sequel to the case of Alexander v. Alexander, 241 Ark. 741, 410 S. W. 2d 136 (1967). In that case, we approved a decree which granted appellee (1) a divorce, (2) possession of the jointly owned home with the provision that she be responsible for payment of all taxes, insurance and maintenance expenses, (3) one-third of the 53,710 shares of stock owned by appellant on the date of their separation, and (4) alimony in the amount of $100 per month. In affirming that order, it was noted that “appellant and his son had withdrawn in excess of $25,000 from the corporation in less than a year, not counting an expensive boat bought for them or the corporation; that he [appellant] draws an annual salary in excess of $5,000 not counting an expense aqcount and; that he owns real estate of an undisclosed value.” Further, “appellee was earning $88.42 per month at the time of the divorce; that the house in which she lives is in need of extensive repairs and that she is not able to work regularly because of bad health, being afflicted with bronchitis and chronic kidney and bladder trouble.”

In September, 1967 (less than a year after the divorce decree was affirmed), appellant secured a reduction in his alimony payments to $80 per month based upon appellee’ becoming regularly employed and appellant’s assertion that he had no earnings at that time. His only source of income was his expenses which were paid by the family owned corporation. About three years later, appellant’s present petition was filed and the alimony award to appellee was further reduced to $40 per month. For reversal of that order, appellant contends that the facts and circumstances in this case do not justify the continuation of any support payments to appellee.

Appellant, age 65, testified that he was no longer employed by Alexander, Inc., and had not received any monies from the corporation since July 9, 1970. During the first six months of 1970, the corporation had paid him a total amount of $4,004. He was currently (February, 1971) receiving $49.60 a week from workmen’s compensation. In addition, he had received $600 in disability insurance. At the present time, his only source of income was workmen’s compensation. According to him, his physician had advised him that he was unable to return to work. The corporation, which had existed since 1945, had never declared a stock dividend and was presently losing money.

On cross-examination appellant testified that he now is the principal stock holder in the family owned corporation (28,000 shares at .15 a share). He owns a duplex, unrented for three years, on which he makes a $50 per month payment. He receives a total of $120 per month rental income from his sister, her husband, and a third person who live with him in his home. The payment on this house is $146 per month. He has a collection of antique jewelry and watches. The insurance value of the watches is $2,500. A month before the hearing (February, 1971) he had applied for social security benefits and had received no reply.

Appellee testified that she is regularly employed by the Federal Government as a GS-4 (Clerk). Her take-home income is $81 per week. Her health is not good and she did not know how much longer she would be able to continue working. Because of her age, 57, she could not work the minimum time necessary to entitle her to eventual retirement benefits. The 40-year-old home occupied by appellee is owned by appellee and appellant as an estate by the entirety. According to appellee, the insurance is $155 a year and taxes are approximately $200 a year. These expenses together with the necessary repairs and maintenance of the old house were costing her about $80 each month, which was equal to the alimony payment. Further, she has an outstanding dental bill of approximately $300.

Although appellant testified he was unable to work and that his income was limited to $49 per week, his testimony is not treated as uncontradicted. In Livingston v. Livingston, 247 Ark. 1137, 449 S. W. 2d 396 (1970), we said “the testimony of a litigant or of a party interested in the result of the litigation is not treated as uncontradicted or undisputed.” In our prior decision, Alexander v. Alexander, supra, we quoted with approval this appropriate language:

“This court has many times announced the rule that in fixing the amount of alimony to be awarded a wide discretion rests with the trial court and unless there appears to be a clear abuse in the exercise of this discretion it will not be disturbed by this court.”

In the case at bar, the chancellor was in a superior position to determine the credibility of the witnesses. Furthermore, in doing so the chancellor observed that he could not determine how long appellant would be unable to work; however, “this [alimony] ought to be cut in two, reduced to $40 a month, to help her [appellee] maintain the house, which is for the benefit of both of them. If she lets it go to ruin, whoever survives wouldn’t get much.” Therefore, we are unable to say as a matter of law that the chancellor’s finding constituted a clear abuse of his discretion.

Affirmed.

Byrd, J., dissents.

George Rose Smith, J., not participating.


author: Frank Holt, Justice.

text:
    Larry Joe WILLIAMS v. STATE of Arkansas
    5736
    482 S.W. 2d 810
    Opinion delivered July 24 1972

      Jack M. Lewis and C. E. Blackburn, for appellant.

      Ray Thornton, Attorney General; Milton Lueken, Asst. Atty. Gen., for appellee.
   Frank Holt, Justice.

A jury found appellant guilty of possession of stolen property and assessed his punishment at one year and a day in the State Penitentiary. For reversal of that judgment, appellant first contends that the proof adduced by the state as to value of the property is insubstantial. We find no merit in this assertion.

We view the evidence on appeal in the light most favorable to the appellee in determining the substantiality of the evidence to support a jury verdict. Rickie v. State, 250 Ark. 700, 466 S. W. 2d 462 (1971).

The Conway County Coon Hunters Club was broken into and four trophies along with some soft drinks were taken from the club. Two days later the four trophies were found in the trunk of appellant’s automobile. The secretary of the club testified that he had ordered the trophies which were to be presented as awards to winners of various sporting events sponsored by the club. He described the trophies as “new’.’ and testified that their cost “would run somewhere around $10 apiece.” The treasurer of the club testified that he had paid for the trophies and further stated “if the club ordered those four trophies they would cost at least $40,” and he considered them worth $10 apiece before they were stolen.

Of course, it was necessary to present evidence of a substantial nature that the trophies were more than $35 in value to sustain a conviction for possessing stolen property. Ark. Stat. Ann § 41-3938 (Repl. 1964). Hammond v. State, 232 Ark. 692, 340 S. W. 2d 280 (1960). Compare Rogers v. State, 248 Ark. 696, 453 S. W. 2d 393 (1970). We are of the view that there was substantial evidence from which the jury could find that the value of the articles exceeded the required statutory sum. We note that the jury was instructed on a lesser included offense which is a misdemeanor. It was for the jury to reconcile the evidence and determine the grade of the offense.

Furthermore, we do not think “the court erred in applying the law with regard to proper proof of value of the stolen property.” In Cowan v. State, 171 Ark. 1018, 287 S. W. 201 (1926), we held that the actual cost of the automobile license plat was admissible as to the grade of larceny allegedly committed by stealing the plates from the car. See, also, 50 Am. Jur. 2d, Larceny, §§ 45 and 148, and Wharton’s Criminal Law and Procedure, 2, § 449 (12th Edition, 1957), to the effect that the actual or cost price of an article is admissible as being one factor for the jury to consider along with other factors in determining the market value. It is well established in civil cases that the original cost of property, as in eminent domain cases, is admissible so long as it is not too remote in time and bears a reasonable relation to the present value. Such evidence exists in this case.

Appellant next contends for reversal that the prosecuting attorney’s office failed to divulge information in its or its agents’ (sheriff’s office) possession concerning a material witness favorable to the defense. About a month following the appellant’s conviction, the appellant, in support of his motion for a new trial, presented a witness who testified that, as a retailer, he had sold these or similar trophies to the club; that before the trial the sheriff’s office called him in for identification purposes; and he had expressed his opinion that the total value of the trophies new was less than $35 or at the most $32.50. It appears that one investigating officer and the secretary of the club were present when the retailer viewed the trophies. The officer testified there was no detailed discussion relating to the price of the trophies; and he understood the presence of the retailer was for identification purposes; namely, “if they were the ones he sold.” Another deputy testified that he was not present when the retailer saw the property. He filed his investigative report with the prosecuting attorney’s office and he believed he gave the appellant a copy, also. The secretary of the club testified at the hearing that he had told the deputy prosecuting attorney about this witness and a conversation with him; however, the secretary said that his testimony at the trial, relating to the trophies’ value, was the same which he had imparted to the deputy prosecutor after his conversation with the retailer. There is no evidence that the prosecuting attorney’s office or its agents suppressed any evidence. In fact, appellant agrees nothing of such a nature was intentionally done. We note that this retailer or witness’ name was mentioned as a source of purchases during presentation of the state’s testimony in chief. No request for a continuance was made. In the circumstances, we hold that the trial court properly denied appellant’s motion for a new trial based upon the asserted suppression of evidence favorable to the appellant. Newly discovered evidence which tends only to impreach other testimony is not necessarily grounds for a new trial. Murchison v. State, 249 Ark. 861, 462 S. W. 2d 853 (1971). Newly discovered evidence is one of the least favored grounds to justify granting a motion for a new trial and, further, such a motion is addressed to the sound discretionary authority of the trial judge. Steel v. State, 246 Ark. 75, 436 S. W. 2d 800 (1969). In the case at bar, the appellant has not demonstrated that the trial court abused its discretionary power in refusing to grant his motion for anew trial.

Affirmed.


author: W. B. Putman, Special Justice.

text:
    Edward L. GLOVER and Lyndel B. GLOVER, his wife; Vernon ASHCRAFT and Bonnie ASHCRAFT, his wife et al v. I. H. WALTER and Hannah WALTER, his wife et al
    5-5720
    483 S.W. 2d 713
    Opinion delivered July 24, 1972
    [As Modified on Denial of Rehearing September 11, 1972.]

      Reinberger, Eilbott, Smith ir Slaten, Wilton E. Steed, Jimmy D. Joyce and John Langston, for appellants.

      Coleman, Gantt, Ramsay & Cox, for appellees.
   W. B. Putman, Special Justice.

Appellees brought this action against appellants to quiet title to certain property in Sections 3, 4, 9 and 10, Township 4 South, Range 10 West in Jefferson County, Arkansas, near a point on the Arkansas River designated mile 126.

It is the theory of the appellees that the land in question accreted to their property which lies on the west or right bank of the Arkansas River. Appellants Ashcraft and Willis assert title to a portion of the property by virtue of two tax deeds acquired from the State of Arkansas in 1956 and 1957 and the payment of taxes thereon every year since.

Appellants Glover maintain that the disputed property is not an accretion but developed as an isalnd in the river and that they are the owners of that portion in the East Half of Section 10 because of the provisions of Ark. Stat 10-202, which provides as follows:

Lands formed in navigable waters-Title in riparian owner. "All land which has formed or may hereafter form, in the navigable waters of this State, and within the original boundaries of a former owner of land upon such stream, shall belong to and the title thereto shall vest in such former owner, his heirs or assigns, or in whoever may have lawfully succeeded to the right of such former owner therein.”

The chain of title of the appellants Glover to the East Half of Section 10 (except that portion in the river and occupied by the levee) and their payment of taxes thereon are not in dispute.

The trial court found that the land was as accretion to the property of appellees, that the appellants had no right, title or interest therein and entered a decree quieting title in appellees as prayed in their complaint.

From that decree this appeal was taken.

The paramount question to be decided in determining the rights of appellees is whether the land in dispute developed as an accretion to the west or right bank of the Arkansas River or whether it developed as an island. If it developed as an island the appellees cannot prevail for although they allege actual adverse possession, the evidence clearly is insufficient to support such an allegation and their only serious claim to ownership is by way of accretion.

At the trial a number of witnesses gave testimony tending to shed some light on the manner in which the disputed land came into existence, but the most helpful evidence in making this determination is a series of maps, plats and aerial photographs introduced by the appellees, and largely prepared by the United States Corps of Engineers showing the section of the river in question at various times from 1825 to August of 1967. The survey dated April 20, 1825, shows that at that time the river ran through the West Half of Section 10 and the Fractional West Half of Section 3. No land formation of any kind is shown to have existed in the river at that time. A subsequent map dated May-December, 1917, however, shows a prominent land formation surrounded by the main channel of the Arkansas River on the east and a smaller distinct channel on the west. An aerial photograph made in 1945 discloses an unmistakable “island” at mile 126 with well established channels on both the east and west sides. Other such maps and photographs reveal that the west channel remained in existence until the deliberate diversion of the flow of water by the erection of dikes between the land formation and the mainland. These exhibits disclose a gradual shifting of the channel of the river from the west to the east between the years of 1825 and 1967.

We are of the view that the property in question did not develop as an accretion to the land of appellees, but was instead an island and that the Chancellor’s findings to the contrary are against the preponderance of the evidence: It follows therefore that the complaint of appellees, plaintiffs below, should be dismissed, except as to such land (not a part of the island in dispute) as the trial court on remand may find has accreted to the west bank of the old west channel of the river.

There remain the questions of what rights, if any, the appellants have to the disputed land. We have concluded that the appellants Ashcraft and the heirs of M. F. Willis have none.

It is true, of course, that Vernon A. Ashcraft and M. F. Willis obtained a tax deed from the State of Arkansas in 1956 covering the Southwest Quarter of Section 3, Township 4 South, Range 10 West “Exc. that Pt. S. of River.” But as the learned Chancellor pointed out Ashcraft’s exhibit no. 12 reveals that all of the Southwest Quarter of Section 3 lies south of the river and is therefore within the exception. This deed does not, of course, constitute color of title so as to give appellants constructive possession by the payment of taxes which will ripen into ownership in seven years under the provisions of Ark. Stat. 37-102.

We are likewise compelled to the conclusion that the tax deed to Vernon A. Ashcraft of July 22, 1957, does not constitute color of title. The deed purports to convey “All FrL.NW exc. N. of R. (125 ac.)”, and SE exc. N.. of R. (88 ac.)” of Section 3, Township 4 South, Range 10 West. Under the decisions of this Court the description is insufficient and the deed is void. In Simms v. Rolfe, 177 Ark. 52, 5 S.W. 2d 718 (1928), this Court invalidated a levee tax sale because the property was sold and later deeded under the description “W of R NE/4, Sec. 8, Twp. 5 North range 4 East.” In that case, the Court refused to construe “R” as meaning “river,” saying:

“The letter “R” or “r” is the proper abbreviation for range within the meaning of government surveys when used with reference thereto. When used otherwise in an attempted description of land, it means nothing.”

Halliburton v. Brinkley, 135 Ark. 592, 204 S.W. 213 (1918), see also Riley v. Eight Mile Drainage Dist. No. 5, 223 Ark. 533, 267 S.W. 2d 302 (1954).

The chain of title to and proper payment of taxes on the East Half of Section 10 by appellants Glover is not in question. Having determined that the preponderance of the evidence shows the land formation in question to have been formed as an island, it is clear that the appellants are entitled to the benefits of Ark. Stat. 10-202 to the extent that any portion of the island lies within that description.

Special Justices Richard Mays and G. D. Walker concur in this opinion.

Harris, C. J., and Byrd and Holt, JJ., not participating.


author: George F. Hartje, Special Justice.

text:
    INTERNATIONAL GRAPHICS, Inc., An Arkansas Corporation v. Kelly BRYANT, As Secretary for the State of Arkansas et al
    5-5970
    482 S.W. 2d 820
    Opinion delivered July 24, 1972

      Spitzberg, Mitchell ir Hays, for appellant.

      Smith, Williams, Friday, Eldredge & Clark, by: Michael G. Thompson and Joe D. Beel and Joseph D. Mor ley, for appellees.
   George F. Hartje, Special Justice.

This action was brought against Kelly Bryant, as Secretary of the State of Arkansas, to require him, under a mandamus proceeding, to approve and accept several bids submitted by appellant, International Graphics, Inc., on state printing contracts. Appellant had submitted its bid in response to a Notice to Bidders on the appointed day and prior to the 10:00 a.m. deadline. The testimony is not in conflict as to what followed. About 11:30 a.m. while bids were being opened and read, but prior to any of appellant’s bids being opened and read, appellant notified the Secretary of State that it had not executed the general provisions included with the bids as required by the Official Instructions to Bidders Upon State Printing Contracts and offered to substitute signed copies of the general provisions at that time and was refused by the appellee. Later, when its bids were opened, appellant was the apparent low bidder on several contracts to be awarded, but the contracts were awarded to other bidders upon the grounds that the appellant had failed to meet all of the requirements for a qualified bidder, and that its bid was not acceptable.

The lower court dismissed the petition for Writ of Mandamus but found by way of declaratory judgment that appellant was the lowest responsible bidder and should have been awarded the contracts. Appellant appealed from the dismissal of its mandamus action, and appellee cross appealed from the finding that appellant was the lowest responsible bidder.

The Official Instructions to Bidders Upon State Printing Contracts provided in paragraph 4:

“A properly executed copy of the form entitled ‘General Provisions Applying to all State Printing Contracts’ must be attached to each bid upon each contract.”

These general provisions are a very important part of any state printing contract. They, specifically set forth the answers to various questions and requirements of the contract as to the quality of workmanship acceptable, the procedures to be followed, questions regarding overruns and underruns, delivery methods and charges, quality of products to be used, items which become the property of the State of Arkansas, etc. Without the general provisions a printing contract is incomplete. The general provisions are, in effect, the “fine print” of the contract and official, requirements and instructions to each bidder are that they will be properly executed. In this instance a proper execution would require the signature of the bidder or its representative. The appellant argues, however, that the bid as executed by it contained wording

“(that the work will be done) in compliance with the attached general provisions for the state printing contracts as fixed by law,”

and that although it did not execute the general provisions, they were incorporated by reference in its signed bid, and thus their execution was not required. Where a written contract refers to another instrument and makes the terms and conditions of such instrument a part of it, the two will be construed together as the agreement of the parties. See Am. Jur. 2d Vol. 17, Sec. 263, page 666.

Here there was no contract, only an offer to contract which sought to incorporate by reference the general provisions which specifically provided:

“A copy of these provisions is to be signed, attached to and made an integral part of each contract bid upon.”

The general provisions also contained a prepared place for the signature of the bidder or its representative. This requirement of execution is not a harsh or impossible one and was well known to appellant, who had bid upon state contracts properly in die past and who had at one time, according to the testimony, printed many copies of the Official Instructions to Bidders Upon State Contracts for the appellee. No contract having ever been entered into between the parties to this action, it follows that the general provisions were not incorporated by reference, because it was the clear intention of the appellee that the completed contract include a properly executed agreement to the general provisions.

It is quite possible that should appellant have subsequently determined that the contracts were unfavorable, it might well have taken the position that it was not bound to perform in accordance with the general provisions, it having not executed them specifically as required. Not only that, but if appellant’s bid had been accepted, the other bidders who had executed the general provisions and thus complied with all requirements, could well feel that they had been treated unjustly and unfairly.

The appellant did not submit a proper bid upon the printing contracts sought by it and denied it, and thus it was not the lowest responsible bidder as by law required. The appellee was correct in rejecting the improperly submitted bid.

The judgment is reversed on cross appeal, and thus the questions raised on the direct appeal become moot.

Holt, j., not participating.


author: Conley Byrd, Justice.

text:
    David MOODY By Noah MOODY, His Next Friend v. AMERICAN FIDELITY ASSURANCE COMPANY et al
    5-5952
    481 S.W. 2d 700
    Opinion delivered June 19, 1972

      Laws & Schulze for appellant.

      Williams ir Gardner, for appellees
   Conley Byrd, Justice.

This is an action by Noah Moody as next friend of his minor son David Moody, a newspaper delivery boy, to recover upon a policy issued by appellee American Fidelity Assurance Company to appellee Arkansas Democrat Company, a corporation, pursuant to Ark. Stat. Ann. § 81-716 (Supp. 1971). With reference to medical coverage that statute provides:

“. . . and this hospital and medical expense protection shall be excess insurance coverage or indemnity over and above any other collectable insurance.”

It is admitted that as a result of an accident to David Moody while delivering newspapers, medical expenses of $1,163.75 have been incurred. $914.50 have been paid by other insurance sources and American Fidelity has tendered $249.25. Upon this admission the trial court ruled that the medical insurance protection provided pursuant to Ark. Stat. Ann. § 81-716 constituted “excess insurance” and dismissed appellant’s complaint. We agree.

The term “excess insurance” has been used so commonly and been construed so many times that we must assume that the legislature used it in accordance with its commonly accepted meaning. See 44 Am. Jur. 2d Insurance § 1815 where in commenting on “excess insurance” it is said:

“As contradistinguished from a prorata or proportionate recovery clause, insurance policies occasionally provide that as to a particular coverage, it shall be 'excess’ insurance only. Under such a policy and as to such a coverage the insurance company issuing the policy is not liable for any part of the loss or damage which is covered by other insurance, but is liable only for the amount of loss or damage in excess of the coverage provided by the other policy or policies of insurance. An excess insurer was not liable under its policy to contribute to expenses incurred by the plaintiff in successfully defending a suit where the only obligation under its contract was to contribute to either a judgment or a settlement.”

In accordance with the constant legal definition given to the term “excess insurance,” we agree with the trial court that under the statute American Fidelity is not liable for any part of the medical expense covered by other insurance.

Affirmed.