author: Ed. F. McFaddiN, Associate Justice.

text:
    Newton County Republican Central Committee v. Clark.
    5-1602
    311 S. W. 2d 774
    Opinion delivered March 31, 1958.

      Ben G. Henley, for appellant.

      Eugene W. Moore, for appellee.
   Ed. F. McFaddiN, Associate Justice.

This appeal requires consideration of Act No. 205 of the 1957 General Assembly entitled, “An Act to Amend the Election Laws of This State to Require Primary Elections in Certain Instances; to Repeal Conflictng Laws; and for Other Purposes”. It is popularly called “The Compulsory Primary Act”.

The appellee Quinton Clark, as plaintiff, filed this action in the Newton Circuit Court against the defendants, Newton County Republican Central Committee and the named officers and members of said Committee. The complaint alleged:

‘ ‘ That plaintiff is a legal resident and qualified elector of Newton County, Arkansas, and qualified under the laws of Arkansas to seek and hold the office of County Representative in said County and State; that he is desirous of seeking the Republican nomination for County Representative in the General Assembly of Arkansas in the year 1958; that on the 27th day of February, 1958, pursuant, to Act 205 of the 1957 Arkansas General Assembly and all other primary election laws now in effect, he tendered his proper corrupt practice pledge to the said Frank Cheatham and J. W. Waters, Chairman and Secretary respectively of the Newton County Republican Central Committee, and requested said committee to fix the fees incident to his filing as a candidate for said office in a Republican Primary election, as provided by Act 205 of 1957 and all other primary election laws pertaining thereto; that the defendants in their said capacities aforesaid, refused to accept his corrupt practice pledge and refused to set any filing fees for said office; and defendants refused to call a Republican Primary election in Newton County, Arkansas to ascertain the nominee for said office or any other office. That the plaintiff has no other remedy than to seek mandamus against the defendants directing the defendants to permit this plaintiff to qualify as a candidate for Representative in the Republican Primary election in Newton County, Arkansas as provided by law, and especially as provided by Act 205 of the 1957 General Assembly of Arkansas.”

The prayer of the complaint was for a writ of mandamus to require the defendants to comply with said Act No. 205 and take all necessary steps for a Republican Primary election in Newton County so that the plaintiff might be a candidate in said primary. The defendants demurred to the complaint; the Circuit Court overruled the demurrer; the defendants stood on their demurrer; the Circuit Court ordered mandamus issued ; and the defendants excepted and prosecuted this appeal. We advanced the case and requested the Attorney General to file a brief amicus curiae, which has been filed and has proved helpful to the Court.

The Act No. 205 has five sections: Section 1 amends § 3-201 Ark. Stats.; Section 2 amends § 3-204 Ark. Stats.; Section 3 amends § 3-261 Ark. Stats.; Section 4 repeals § 3-266 Ark. Stats.; and Section 5 declares the purpose of the Act in this language:

“It is the purpose and intent of this Act to require all political parties desiring to nominate any person for United States Senate, United States House of Representatives, State, District, or County office, so that any such persons name shall appear on the general election ballot as a representative of that political party, to do so only by primary election; and to require such primary elections to be held at the same time and place, and qualified voters to cast bnt one ballot thereat for the candidates representing the party of his or her choice. Any provision in our election laws to the contrary is hereby repealed in its entirety to this extent.”

At the outset we emphasize that all other portions of the primary election laws (§§ 3-201 to 3-266) not amended or repealed by the Act No. 205 were in full force and effect when this Act was adopted, and they aid in the understanding and interpretation of the Act No. 205. It is one of the rules of statutory construction that new legislation must be construed with reference to existing legislation on the same subject. Connelly v. Lawhon, 180 Ark. 964, 23 S. W. 2d 990; and Indian Bayou Dist. of Lonoke County v. Dickie, 177 Ark. 728, 7 S. W. 2d 794. It is also well to reiterate what was said in Adams v. Whittaker, 210 Ark. 298, 195 S. W. 2d 634. We were there asked to declare void Act No. 107 of 1945 which required separate primaries for the selection of candidates for federal offices. It was urged that the Act was inconsistent as well as unconstitutional; and we said:

“We are, of course, not concerned with the wisdom or policy of the legislation as this is a question solely for the General Assembly. We may consider only the power of the General Assembly to enact the legislation. In the case of Eagle v. Beard, 33 Ark. 497, Justice Ealcin said: ‘Comity towards a co-ordinate department of the government forbids the discussion of matters of discretion, when the power is conceded.’ The power to enact this statute exists unless in contravention of our own or the federal Constitution, and in passing upon that question every doubt must be resolved in favor of its validity.”

We have repeatedly said that the question of the wisdom or expediency of a statute is for the Legislature alone. The mere fact that a statute may seem to be more or less unreasonable or unwise does not justify a court in annulling it, as courts do not sit to supervise legislation. Courts do not make the law: they merely construe, apply, and interpret it. Craig v. Flanagin, 21 Ark. 319; Ark. Stave Co. v. State, 94 Ark. 27, 125 S. W. 1001, 27 L. R. A. N. S. 255, 140 A. S. R. 103; Gates v. Hughson, 186 Ark. 348, 53 S. W. 2d 581; and McDonald v. Wasson, 188 Ark. 782, 67 S. W. 2d 722. In the light of all of the foregoing background we come to the attacks here made on the Act No. 205. Appellants have three points in their brief which we list and consider.

I. Appellants’ First Point: “Said Act 205 is too vague and uncertain to he effective, and is void on that account”. We have a number of cases which recognize that a statute may be void because of uncertainty. Jones v. Lawson, 143 Ark. 83, 220 S. W. 311; and Snow v. Riggs, 172 Ark. 835, 290 S. W. 591. Appellants claim that the Act No. 205 falls within the scope of these cases and lists several attacks, which we identify by alphabetical listing.

A. Appellants say: “Act 205 creates uncertainties as to whom is to be elected because of the conflicts, expressed in Sections 1, 3, and 5. The ‘offices’ covered by the express definition of intent in Section 5 is in conflict with Section 3, and Section 3 is in conflict with Section 1 in that respect”. This entire attack could be bypassed in the case at bar by pointing out that this is a case brought by a person who wants to be a candidate for the Legislature in a Republican Primary; and there is no question of conflict regarding “offices” so far as members of the Legislature are concerned. But it is well that we go further and consider the argument, advanced by appellants. Section 5 of the Act — which we have heretofore copied- — ■ mentions “United States Senate, United States House of Representatives, State, District, or County office.” Section 3 of the Act adds, by parenthetical expression, “including National, State, and County Committeemen and Committeewomen”; and Section 1 of the Act adds, by parenthetical expression, “including Township or Precinct Committeemen”.

Because of the parenthetical additions in Sections 1 and 8, appellants argue that the entire Act is void for uncertainty. They claim that under Sections 1 and 3 of the Act, the Democratic and Republican National, State, and County Committee members, as well as Township and Precinct Committee members, would have to be voted on in the General Election. We do not so interpret the Act. The election of the National, State, County, Township, and Precinct Committee members of each Party will be settled by the Primary election of each Party, as these are Party officers and not candidates of the Party in the General Election.

It is only the candidates of the Party for nomination in the General Election that go on the General Election ticket. Democratic Committeemen are Party officers; as are Republican Committeemen; and this Act must be construed in the light of the law existing when the Legislature adopted the Act. The parenthetical expressions in Sections 1 and 3 of the Act, relating to National, State, County, Township, and Precinct Committee members, were undoubtedly added to make sure that § 3-217 Ark. Stats, was followed. With this understanding, the Act loses the “vague and uncertain” features urged by appellants.

We frankly confess that the Act No. 205 does cast some doubt on § 3-254 Ark. Stats, as to whether Municipal officers and Township officers may still be nominated by conventions. Section 1(b) of the Act No. 205 says:

“Nominees of any political party for Township or Municipal offices may be declared either by (1) certificate of primary election called, held and conducted as required by law; or (2) by petition of electors as provided in Section 3-261, Arkansas Statutes of 1947.”

It is a question whether Act 205, by implication, repeals § 3-254 Ark. Stats. But the Legislature can easily remedy that uncertainty by passing definite legislation. The question here before us is, whether the NeAvton County Republican Central Committee should have a primary election for State, District, and County offices; and there is no need for us to “borrow trouble” by considering municipal and township matters, as those issues are not now before us. We merely make this observation for the information of future Legislatures.

B. Appellants say that, under Act No. 205, should a vacancy of a nomination occur after the primary and before the General Election, then no one could fill such vacancy because — appellants say — under Section 1(d) of the Act the nominees have to be declared by a certificate of the Chairman and Secretary of any Convention of Delegates, and the Convention of Delegates might have already adjourned before such vacancy. We point out that by § 3-264 Ark. Stats, the Central Committee has power to name a nominee of the Party, should the previously named nominee pass away or decline the nomination. So appellants’ argument fails as regards this point.

C. Appellants next assail that portion' of Section 2 of the Act No. 205 which says that Primary elections of each political Party “shall be held at the same place and on the same day”. Appellants say that the confusion that would result from enforcing this law “would be unimaginable”. We do not view the language as do the appellants. The Avords in the Act do not mean that there will necessarily be held a balloting in the same room. The Avords “same place” could mean in the same general locality. Certainly the requirements would be satisfied if in one room of a building there were the officials and ballot boxes for holding the Republican Primary, and in another room there were the officials and ballot boxes for holding the Democratic Primary. The point is, that the legislation requires a voter to decide to which Party be belongs and to vote in-that Primary, only. This is crystal clear from the Act. Each Party may run its own Primary election, entirely separate and independent of the other, and the voters of one Party are not to participate in the Primary election of the other Party. Should the political Parties desire to have expenses reduced, then they might do so my mutual consent and agreement. We might envisage that the State Central Committee of each Party could decide that it wants to empower the County Committees to work out a joint arrangement with the opposition Party to reduce the expense of the election; and if such permission be given by the State Committee to the County Committees, then the County Committees could decide how far they desired to go with the opposition Party in reducing the expense of the election. We cannot hold the Act void because appellants do not like some of its provisions.

D. Next the appellants attack that portion of Section 3(g) of the Act which requires the certificate of nomination to be accompanied by the receipt of the Treasurer or Collector of each County in which said candidate is to be voted for. Appellants say: “In the light of the existing law on the subject, does Section 3(g) mean that in a statewide race a candidate must file the receipt of the ‘ Treasurer or collector of each County’?” We think that appellants are trying to apply Section 3(g) to the Primary elections. It is perfectly clear that the section applies only to the General Election. If a person becomes the nominee of his Party then he (or his Party for him) complies with Section 3(g) of the Act No. 205. That has been the law for a long time. It was first adopted in 1891. The wording of Section 3(g) is practically identical with a portion of the language found in old § 3-261 of the Statutes.

E. Finally, appellants say that Section 4 of Act No. 205 repeals § 3-266 Ark. Stats, and therefore leaves the law in hopeless confusion. We do not agree with appellants’ conclusion. Section 3-266 of Ark. Stats, was Act No. 479 of 1949. Prior to that Act, candidates unopposed in a Primary were nevertheless voted on, in the Primary election. The repeal of § 3-266 Ark. Stats, puts the law in that regard back to where it ■was before 1949 and certainly leaves no “hopeless confusion” or great unnecessary expense.

F. In the brief of the amicus curiae it is suggested that there is much uncertainty as to whether Sections 1(c) and 3(c) authorize independent candidates without Party affiliation to run in the Primary election. We understand these Sections provide the procedure whereby an independent candidate may get his name on the ticket in the General Election, and have no reference to Primary elections. We reiterate that Section 5 of the Act makes clear that it is the purpose of the Act to have Party nominations by Primary elections rather than by Convention action; and with that general understanding the other questions arising because of the Act seem to fit into the general pattern of our Primary election laws. It is said that the Act is loosely drawn and bears evidence of having been hastily prepared. Possibly so: but, as we have previously remarked, it is not the duty of the courts to act as supervisors of legislation: it is the court’s duty to interpret, apply, and construe the legislation; and with that general thought in mind, we can find no reason for saying that the Act No. 205, is so vague and conflicting as to be null and void.

II. In Their Second Point A p p ell ant s say: “Said Act being not severable and being in conflict with its own terms and with the, general primary election laics of this State, it is impossible of performance and deprives the candidate of the right to seek office and- the elector of his franchise.” Under this point appellants invoke the rule which declares that when a Statute is indivisible and is void in part and the Court cannot determine that the Legislature would have adopted the remainder of the Statute without the void portion, then the entire Statute must fall. Ex parte Jones, 49 Ark. 110, 4 S. W. 639; State ex rel. Attorney Gen eral v. Williams-Echols Dry Goods Co., 176 Ark. 324, 3 S. W. 2d 340; Webb v. Adams, 180 Ark. 713, 23 S. W. 2d 617; and Oates v. Rogers, 201 Ark. 335, 144 S. W. 2d 457. We have studied every attack on the Act listed by the appellants and the amicus curiae, and we find no reason for holding the Act void; so there is no necessity to discnss the applicability of the statutory rule here invoked by appellants. We reach the conclusion that the Act is capable of fair interpretation, construction, and administration; and we refuse to declare it void.

III. Constitutionality. The Appellants’ Third Point Is: “That the ruling of the trial court offends Section 5 of Amendment 29 to the Constitution of the State of Arkansas’’. This point lacks merit. Section 5 of Amendment.29 to the Constitution of Arkansas reads: “Only the names of candidates for office nominated by an organized political party at a convention of delegates, or by a majority of all the votes cast for candidates for the office in a primary election, or by petition, of electors, as provided by law, shall be placed on the ballot in any election”. . Appellants in effect claim that by this language the Constitution made it mandatory that an organized political party could have a convention of delegates. We do not so understand the law. Under this Constitutional Amendment, the Legislature was free to allow either convention action, or primary action, or petition of electors. The words are separated by the disjunctive “or”, so that a candidate selected by any one of the three methods — convention, primary, or petition — could have his. name placed on the ballot. The Amendment was not designed to guarantee a vested right in any political Party to any one of the methods mentioned in the Amendment. It is claimed that the Act 205 infringes on the United States Constitutional Amendment 1 and Amendment 14, and Arkansas Constitution Art. II § 4 and Art. Ill §§ 1 and 2. We see no merit in this argument. Our opinion in the case of Adams v. Whittaker, 210 Ark. 298, 195 S. W. 2d 634, answers all the arguments that conld be made on snch claims.

Finding no error, the judgment is affirmed.

       The Legislative records disclose that the Act No. 205 was S. B. 232 introduced by Senator Jones. The bill passed the Senate by a vote of 31 to 0; and passed the House by a vote of 68 to 6.

       Mandamus is specifically authorized in some instances. See § 3-222 Ark. Stats. and Stock v. Harris, 193 Ark. 114, 97 S. W. 2d 920.

       Should there be a third party, then that party would likewise be. governed by this Act; but at present we have only two Parties in this State, so we use the existing Parties to explain the meaning of the Act.


source: Caselaw Access Project

author: Minor W. Millwee, Associate Justice.

license: Public Domain

text:
    Ex parte Hornsby.
    4899
    311 S. W. 2d 529
    Opinion delivered March 31, 1958.

      Nance ■& Nance by Genii B. Nance, Jr., for petitioner.

      Bmce Bennett, Atty. General and Thorp Thomas, Asst. Atty. General, for the State of Arkansas.
   Minor W. Millwee, Associate Justice.

This is a petition for writ of habeas corpus filed in this court on November 27, 1957, by Hubert Earl Hornsby claiming he was being detained unlawfully in the Crittenden County jail because of his inability to pay a fine and costs of $219.25 adjudged against him in the Municipal Court of West Memphis, Arkansas, on September 16, 1957, upon his plea of nolo contendere to a charge of driving a vehicle while under the influence of intoxicating liquor. We appointed the Honorable Cecil B. Nance Jr. to represent the indigent petitioner.

At the outset we are confronted with the proposition that an application for habeas corpus cannot he made to perform the function of an appeal, or writ of error, in correcting errors or irregularities at the trial. We have repeatedly held that if a petitioner for habeas corpus is in custody under process regular on its face, nothing will he inquired into save the jurisdiction of the court whence the process came. Ex parte Brandon, 49 Ark. 143, 4 S. W. 452; Ex parte Foote, 70 Ark. 12, 65 S. W. 706; State ex rel. Attorney General v. Auten, Judge, 211 Ark. 703, 202 S. W. 2d 763.

Petitioner does allege that the municipal court wag without jurisdiction to try him for a violation of state law. This allegation is without merit under Ark. Stats., Sec. 22-709, which provides that municipal courts shall have jurisdiction concurrent with the circuit court over misdemeanors committed within the county. Petitioner’s remedy as to other alleged irregularities was hy an appeal to circuit court which he failed to prosecute within 30 days as required hy Ark. Stats., Sec. 26-1307. Messina v. State, 211 Ark. 1060, 204 S. W. 2d 547; Whiteley v. Pickens, 225 Ark. 845, 296 S. W. 2d 4. The petition is accordingly denied.

      The plea of nolo contendere was added to the statute [Ark. Stats. Sec. 43-1220] by Act 141 of 1953. Excellent articles on the history, nature and implications of the plea appear in 51 Yale Law Journal 1255 and 7 Ark. Law Review 337.


author: G-eorge Pose Smith, J.

text:
    Leggett v. State.
    4901
    311 S. W. 2d 521
    Opinion delivered March 31, 1958.

      John W. Bailey, for appellant.

      Bruce Bennett, Atty. General, and Thorp Thomas, Asst. Atty. General, for appellee.
   G-eorge Pose Smith, J.

A judgment sentencing the appellant to death upon a conviction for murder was affirmed by this court on February 18, 1957. Leggett v. State, 227 Ark. 393, 299 S. W. 2d 59. On December 3, 1957, pursuant to the provisions of the Uniform Post-Conviction Procedure Act (Ark. Stats. 1947, Title 43, Ch. 31), Leggett filed in the circuit court a petition for a new trial, asserting that at the original trial he had been deprived of certain constitutional rights. This appeal is from an order denying the request for a retrial.

The present petition states that Leggett, in connection with his plea of insanity, was sent by the court to the State Hospital for a mental examination. The petition charges that, although the Hospital’s report re-fleeted the opinion of the examining medical staff, not all the members of the staff were called as witnesses at the trial. This omission, it is said, deprived Leggett of his constitutional right to be confronted with the witnesses against him. U. S. Constitution, Amendment 6; Ark. Constitution, Art. 2, § 10.

This contention is foreclosed by our affirmance of the original judgment. This- same argument was made upon the first appeal and was found to be without merit. The issue was not specifically mentioned in the opinion, for it was necessary to examine dozens of objections in the record, and, as is our practice, we limited our discussion to what were considered to be the appellant’s strongest points. The opinion explained, however, that we had examinéd the entire record and had considered all the issues raised.

The present petition involves no new contention; indeed, the only evidence offered below consisted of excerpts from the record on the first appeal. It is not the intention of this uniform act to permit the defendant to reargue matters already decided. As the court said, with reference to a similar act, in People v. Davis, 415 Ill. 234, 112 N. E. 2d 484: “The Post-Conviction Hearing Act was not intended to be used as a device to obtain another hearing upon a claim of denial of constitutional rights where ■ there has already been a full and final review of the issues raised.” The uniform act, in enumerating the grounds for relief, is explicit in its exclusion óf alleged errors that have been previously and finally litigated or waived in the proceedings resulting in the conviction. Ark. Stats., § 43-3101. This provision must evidently be given effect, else there will be no end to litigation in criminal cases.

This being the first case to reach this court under the uniform act, it should be mentioned that neither party questions . the constitutionality of the statute, and we express no opinion as to its validity.

It is also appropriate to add a word concerning the matter of stays in future cases. The uniform act does not require the circuit court to grant a stay of execution upon the filing’ of a petition for post-eon-yietion relief. This is pointed out by the draftsmen of the act in the Commissioners’ Note to § 1: “This Act deals with post-conviction remedies. It is a procedural statute. It does not deal with nor affect requests, for exampie, in cases where the death penalty has been inflicted, for stays of execution. ’ ’ Hence this is a matter that addresses itself to the discretion of the trial court.

Nor, in our opinion, is the clerk of this court empowered to grant a stay of execution in post-conviction proceedings. His statutory authority with respect to such a stay is limited to appeals from original judgments of conviction. Ark. Stats., § 43-2710. It will accordingly be our practice to require that applications for stays of execution be presented to the court or to a judge thereof when the court is in recess.

Affirmed.


author: Paul Ward, Associate Justice.

text:
    Eakin v. Cities Service Oil Co.
    5-1515
    311 S. W. 2d 530
    Opinion delivered March 31, 1958.

      J. Kenton Cochran, for appellant.

      R. 0. Mason, Bartlesville, Okla., and J. M. Small-wood, for appellee.
   Paul Ward, Associate Justice.

The question is: Can a grantee maintain an action to cancel, as a cloud on Ms title, a forged mineral deed purportedly obtained from his grantor1? This question is presented on a demurrer to the grantee’s complaint.

Appellant, Homer Ealdn, received a deed to 40 acres of land from his father and mother (A. J. and Laura Ealdn) February 20, 1933. At that time there was of record a mineral deed purportedly executed by appellant’s parents purporting to convey an interest to one H. Y. Foster, which mineral deed, by mesne conveyances, was transferred to appellee, Cities Service Oil Company.

On May 15, 1957 appellant filed a complaint (and later an amendment) in which it was alleged, among other things, “that the said mineral deed from A. J. Ealdn and Laura Ealdn, his wife, to H. Y. Foster, defendant, is a forgery and does not contain the true signature of the said A. J. Ealdn or Laura Ealdn.” There were, in the alternative, numerous allegations to the effect that the signatures of Mr. and Mrs. Eakin were secured to the mineral deed by trickery and fraud. The prayer was “that said mineral deed be cancelled, set aside and held for naught and the assignment thereof be removed as a cloud upon his title to said lands.” To the above complaint appellee entered a demurrer which was sustained by the court, and appellant has appealed.

We have concluded that the allegations that the mineral deed was a forgery stated a cause of action which appellant had a right to assert, and that, therefore, the court erred in sustaining appellee’s demurrer. If the mineral deed was a forgery it was a nullity and appellant, as the owner of the land, could maintain an action in Chancery Court to remove it as a cloud on his title. In 9 Am. Jur. page 361, Cancellation of Instruments, § 13 states: “. . ., it is generally held that an action will lie for the cancellation of a forged instrument, notwithstanding any remedy which the complainant has at law.” A similar statement is found in 12 C. J. S. page 955, Cancellation of Instruments, § 20. In Rail v. Mitchell, 175 Ark. 641 (at page 643), 1 S. W. 2d 59, it is said: “No one can claim that an estate in land can be divested by forgery, and every one must be subject to the risk of forgery by officers authorized to take acknowledgments.”

We do not agree with appellee’s contention that the right to cancel the mineral deed on the grounds of forgery conld not be exercised by appellant in this case. Volume 9 of Am. Jur. at page 356 under the subhead “Who May Bring Suit” we find this statement: “Relief by way of cancellation of an instrument is not necessarily confined to a party to the instrument; after the death of the party entitled to a decree of cancellation the right may be enforced by his heirs or personal representatives, and in proper cases relief may be obtained by a stranger to the transaction, if his legal or equitable rights are affected thereby.” Here, there can be no question about appellant’s rights being affected.

Appellee states that appellant abandoned his allegation of forgery when he filed an amendment to his original complaint, but, after an examination of the language used in the amendment, we are unable to agree.

Prior to the time the court sustained appellee’s demurrer, from which came this appeal, the court had rendered a decree in favor of appellant on warning order service, which decree was set aide two weeks later on appellee’s motion. Appellant makes the contention here that the court erred in setting the decree aside because appellee did not follow the proper procedure. We find no merit in this contention for the reason that the term of court had not elapsed. This being true the court had a right to set the decree aside even on its own initiative.

Another question arises which gives us much concern. Since appellant’s complaint also contained allegations to the effect that A. J. and Laura Eakin were induced by trickery and fraud to execute the mineral deed, and since it is very likely there will be a trial on the merits upon remand, we foresee that appellee may challenge appellant’s right to proceed on that ground. So, to avoid unnecessary litigation, we consider that question also.

Since this question is presented to us on demurrer, thus by-passing numerous defenses that might be offered at a trial, we likewise conclude that appellant has a right to prosecute his action to set aside the mineral deed on the ground of fraud. We have held that such a right of action passes to the grantor’s heirs. See: Phillips v. Phillips, 173 Ark. 1, 291 S. W. 802; Richey v. Crabtree, 198 Ark. 25, 127 S. W. 2d 269, and; Cannon v. Owens, 224 Ark. 614, 275 S. W. 2d 445. While we find no allegation in the complaint here that appellant is an heir oí A. J. Eakin, yet we do find from the record that he is a son. We recognize that this feature of the case is not reached by demurrer, but it does assure the likelihood of the question being presented if and when there is a trial on the merits. By what we have said in this connection we do not pass on what appellant’s right might have been had he not been an heir.

Reversed.


author: Sam Robinson, Associate Justice. Ed. F. McFaddin, Associate Justice,

text:
    Walden v. Automobile Owners Safety Insurance Company.
    5-1497
    311 S. W. 2d 780
    Opinion delivered March 31, 1958.
    [Rehearing denied April 28, 1958]

      McMath, Leathervnan & Woods, for appellant.

      Rose, Meeh, House, Barron & Nash, for appellee.
   Sam Robinson, Associate Justice.

This case involves the construction of a policy of accident insurance. The cause was submitted to the trial court on an agreed statement of facts detailing the testimony certain persons would'give if called as witnesses. The stipulation provides: ‘ ‘ Since there is no significant dispute as to the facts involved herein, the above case is being-submitted on the testimony stipulated below for. the decision . . . as to the applicable law.” Mrs. Dan E. Walden, the beneficiary' named in the policy, has appealed from a judgment in favor of the insurance company.

The insured, Dan E. Walden, a resident of Bauxite, was an employee of the United Steelworkers of America in the capacity of handling grievance matters for about 2,500 workers in the aluminum industry. Many of the employees worked at night, and 85 per cent of Walden’s work was done after 7:00 p.m. On occasions be worked all night. Mr. Herbert Jarrett is Area Labor Relations Director for Reynolds Metals Company. On the evening of February 28, 1956, Mr. Walden, Mr. Jarrett and Mr. Guy Bass, a Labor Union official, met in Little Rock to discuss business matters. The meeting lasted until about 1:00- a.m. of February 29th. At this meeting Walden agreed to a change in the date of another meeting previously arranged for the following Friday, although such change would work a hardship on him, the inference being that he would have to notify immediately other members of the Union about the change in date of the nest meeting.

After the meeting between Walden, Jarrett and Bass in Little Rock, which ended about 1:00 a.m., Walden drove Bass to Benton, where they continued to discuss Union matters until about three or four o’clock in the morning, at which time Walden drove away in his car. The nest day Walden’s partly submerged automobile was found on a road leading down into an abandoned bauxite mining pit which had become flooded with water. The road on which the car traveled into the water was very steep at that point. The water ivas up to the top of the hood in front and almost to the bottom of the dashboard, but it was only up to the level of the hub caps on the rear wheels, and the rear bumper was extending over dry land. The gear shift was in reverse; the emergency brake had been set; and all the doors and windows were closed, except the window of the left front door. Walden’s body was found in about 12 or 15 feet of water, 75 or 100 feet, from the automobile. The car keys were found in his pocket. Water covered the area between the automobile and the body. An autopsy showed that Walden came to his death by drowning on the morning of February 29th. There were no bruises, wounds or injuries on his body.

The controversial clause in the policy of insurance provides: “. . . INSURANCE COMPANY . . . Does Hereby Insure DAN E. WALDEN . . . Against loss from accidental bodily injury sustained while driving or riding 'within any automobile, truck or bus for business or pleasure during the term of this policy, provided such bodily injuries are caused solely by reason of an automobile, truck or bus accident.” The amount payable for loss of life is $2,000. Printed on the face of the policy in conspicuous lettering is “THIS IS A LIMITED POLICY — READ CAREFULLY”.

"We think the circumstantial evidence as outlined in the agreed statement of facts proves by a preponderance of the evidence that the insured accidentally drove his car into the water; that it was dark, and the insured suddenly found himself in water that came up into the seat of the car; that in an attempt to escape from his very hazardous predicament he went out the window of the car and was drowned. There is no substantial evidence to the contrary. That he got out of .the car into the water and came to his death by drowning is conclusive. There is no indication of suicide, and the presumption is against it. The fact that he may have struggled 75 or 100 feet before he drowned is not material. i

The insurance company contends that according to the undisputed testimony the insured was not injured while driving within an automobile. On the other hand, the beneficiary contends that she is entitled to recover although the insured was not injured inside the automobile but came to his death by drowning after he left the automobile, in the circumstances shown here.

Both sides have cited numerous cases having the same or similar policy provisions which they contend sustain their respective contentions. Some of the cited cases holding against recovery on the policies are: Wertman v. Michigan Mut. Liability Co., 267 Mich. 508, 255 N. W. 418. There, the insured had a wreck, got out of the ear to a place of safety, and a few minutes later went back to the car, where he was electrocuted. In Eynon v. Continental Life Ins. Co. of Mo., 252 Mich. 279, 233 N. W. 228, the insured was injured while putting air in a tire. Independence Ins. Co. v. Blanford's Adm’x., 276 Ky. 692, 125 S. W. 2d 249, turned on a question of fact. The court held that the insured car went out of control and stopped 53 feet from a canal. Several months later the insured’s body was found in the canal. It was badly decomposed and the cause of death could not be determined. In Life & Casualty Ins. Co. of Tenn. v. DeArman, 192 Ark. 11, 90 S. W. 2d 206, the policy provided that the insured must be riding inside an automobile at the time of injury. The policyholder was riding on the outside of a cattle truck at the time of the mishap.

McDaniel v. Standard Acc. Ins. Co., 221 F. 2d 171, is closely in point. The policy insured Hollis McDaniel “from loss resulting directly and independently of all other causes from accidental bodily injuries” except “For death, disability or other loss resulting directly or indirectly from injury sustained by the Insured while in or on any .aircraft or other device for air travel or in falling or otherwise descending therefrom or therewith or while operating or handling such aircraft or device, unless the Insured is riding as a fare-paying passenger in a licensed airplane or dirigible, operated by a licensed passenger carrier on a published schedule over a regular passenger route and between established airports.” The insured was in a private airplane which made an emergency landing in Lake Portage. He attempted to swim ashore but drowned when he was within about 15 feet of the bank. The court held that the exclusion provision did not apply, but not a single case is cited in support of the decision. And in Eschweiler v. General Acc. Fire & Life Assur. Corp., 241 F. 2d 101, the same court rendered a similar opinion, citing only the McDaniel case. Johnson v. Federal Life Ins. Co., 60 N. D. 397, 234 N. W. 661, was a carbon monoxide poisoning case. There the decision was based on a literal construction of the policy. We have adopted the liberal view, as pointed out in Benefit Ass’n of Ry. Employees v. France, 228 Ark. 765, 310 S. W. 2d 225, in which we cited Occidental Life Ins. Co. of Calif. v. Sammons, 224 Ark. 31, 271 S. W. 2d 922.

We think the weight of authority supports the view that in the situation presented the beneficiary is entitled to recover under the terms of the policy. In Miller v. Inter-Ocean Casualty Co., 110 W. Va. 494, 158 S. E. 706, 76 A. L. R. 1308, the policy insured against loss while operating, driving, riding in or on an automobile. The automobile became stuck in the mud. Two passengers proceeded afoot, but Miller, the driver, stayed with the car, and the next day his lifeless body was found in the car. Death was due to carbon monoxide poisoning. The beneficiary was allowed to recover under the terms of the policy.

In Dorsey v. Fidelity Union Casualty Co., Tex. Civ. App., 52 S. W. 2d 775, 776, the policy insured against loss or bodily injuries sustained only as a result of operating, driving, riding in or on an automobile. The policyholder was accidentally shot while he was sitting in an automobile, when a hunting companion, who was standing on the ground away from the automobile, accidentally discharged his gun. The court said: “. . . the insured is entitled to recover, if his injury was the result of operating or riding in the automobile, even though it was only a remote result thereof.” In the case at bar the policy has the additional provision that the injuries must be caused solely by reason of an automobile, truck or bus accident. Here there was an accident — there was a collision of the automobile with the water, and in the case of Washington Fire & Marine Ins. Co. v. Ryburn, decided by this Court on March 24, 1958, 228 Ark. 930, 311 S. W. 2d 302, it was held that a collision with water in a ditch is within the terms of a policy of collision insurance which provided for loss or damage to the automobile caused by collision with another object.

In Provident Life & Acc. Ins. Co. v. Nitsch, 123 F. 2d 600, 601, the. policy had a “while driving, riding in or on . . . an automobile” clause. The insured was accidentally shot while a pistol, along with some other articles, was being removed from the glove compartment after the insured had arrived home at the end of a journey and had stopped the automobile. In holding that recovery could be had under the policy, the court said: “Its (appellant’s) final point that because the automobile had come to a stop, the deceased was not, within the policy coverage, riding in it, is equally without merit.”

In Blashfield’s Cyclopedia of Automobile Law and Practice, Yol. 6, Pt. 2, § 4127, it is said: “Yet if the insured, seeing that (a) collision is inevitable, jumps from (a) truck and is tripped or stumbles and falls in such a position as to pass beneath (the) train, the consequent injury may be said, within the terms of the policy, to have resulted from a collision while ‘actually driving’.” It is hard to see any distinction between jumping from an automobile to avoid being struck by a train, and in doing so being run over by the train, and leaving an automobile to keep from being drowned, and in doing so drowning outside the automobile.

In Life & Casualty Ins. Co. of Tenn. v. Tollison, 223 Ala. 78, 134 So. 805, 807, the driver of a truck, seeing a collision was inevitable, jumped and was injured by a train. The court held that the loss resulted from a collision while actually driving the truck. The court said: “The same relation of insurer and insured obtained if he jumped to save himself, but nevertheless failed to save his limbs. The causal relation between the collision and the loss would be the same. We see no reason to disregard the positive testimony tending to show such was this case, because of inability to definitely account for his position when or after his injury was received.” (Emphasis supplied) Likewise, in the case at bar recovery should not be denied merely because the corpse was found in the water 75 or 100 feet from the car.

And in Wright v. Aetna Life Ins. Co., 10 P. 2d 281, 282, the court said: “. . . the insured was riding down a mountain road of steep grade in the private automobile of a friend, who was driving. In the descent the driver, in attempting to change gear, for the time being lost control of the car. When he finally got it under control, he found the deceased had disappeared, and, going back, found him lying face down on the road. He was unconscious and so fatally injured that death ensued the next day. No one saw how or when he left the ear, and, other than the fact that when the car got out of control he was in it, and when control was regained he was not in it, everything was speculative. Did the policy cover such an accident? That the physical injury suffered by the deceased was inflicted when he struck the road, and not when he was in the car, is clear, and therefore, adhering to the literalism of its policy the company contends the deceased, when injured, was not ‘riding in the car’, and therefore, looking at the injury and accident as occurring at the instant his head struck the roadway the situation was one not covered by the policy. On the other hand, it is contended that the real accident was losing control of the car, and if the deceased was then riding in the car, and one of the natural and to be expected results of that lost control was that he might leave the car, then the policy covered the situation.” In holding that the beneficiary should recover on the policy, the court said, by way of illustration (10 F. 2d 283): “If one were insured while ‘riding in a motorboat’, and circumstances arose where the steering gear ceased to control and the vessel was headed for a dam, rapid, or other vessel, and a frightened passenger jumped out to save himself, and thereafter succumbed and was drowned, while not riding in the motorboat, a reasonable man might contend that under such circumstances the passenger was covered by such policy, although actual death came from drowning. In the present case the real accident was not when Wright’s head' struck the road, but when car control was lost. Such lost car control was the critical accident time, and the dominating factor which subjected the riding passenger to present peril and later death.” The same is true in the case at bar. The real accident was when Walden drove into the water in the mining pit, and that was the thing that subjected him to danger and brought about his death.

This view also is sustained by the cases of Fox v. American Casualty Co., 49 Pa. Dist. & Co. R. 112; Southern Surety Co. v. Davidson, Tex. Civ. App., 280 S. W. 336; Holgate v. Great Eastern Cas. & Ind. Co., 18 Pa. Dist. 426; Fomby v. World Ins. Co. of Omaha, 115 F. 2d 913.

Our conclusion is that Walden’s death is covered by the policy, and the beneficiary - should recover. The judgment is therefore reversed, and since the case was submitted on a stipulation of facts, judgment shall be entered for the plaintiff.

McF addin, J., dissents.

George Rose Smith, J., not participating.

Ed. F. McFaddin, Associate Justice,

dissenting. This case was tried before the Circuit Judge without a jury; and the law is well established that in such a situation the findings of the Court have the force and effect of a jury verdict. It is true that the case was submitted on an agreed statement of facts; but, even so, certain inferences and conclusions had to be drawn from such facts; and it is the province of the jury (the Circuit Judge in this case) to draw such inferences and conclusions; and when so drawn these are binding.

The factual issue for determination was whether Mr. Walden died directly because of the collision of his car with the. water, or whether he died by reason of an intervening efficient cause, i.e., the taking of the wrong direction when he left the car. The Trial Judge found the latter to be true. It was for the Trial Judge to draw the inferences and conclusions from the facts; and under our system we should affirm his findings. In reversing the Circuit Court judgment, this Court is saying, as a matter of law, that whenever a car goes into the water and the person leaving the car drowns, then the drowning is a part of the collision with the water, notwithstanding the fact that there might have been an intervening efficient cause.

In reversing the judgment of the Circuit Court the Supreme Court is sitting as an appellate jury in this case; and I think we should not so constitute ourselves.

Therefore, I respectfully dissent.


author: CarletoN Harris, Chief Justice.

text:
    Hardy v. Hardy.
    5-1415
    311 S. W. 2d 761
    Opinion delivered April 7, 1958.

      Rose, Meek, House, Barron S Nash, for appellant.

      Frank J. Wills, Quinn Glover, Langston & Walker and Wayne Foster, for appellee.
   CarletoN Harris, Chief Justice.

Meriwether Wright Hardy, appellant herein, and Robert L. Hardy, one of the appellees, husband and wife, separated on January 20, 1956. Exactly one month later, appellant instituted suit for divorce in the Pulaski Chancery Court. Hardy filed his answer on March 7th. On March 30th, through a discovery deposition taken from Hardy, appellant learned that on March 6th, Hardy had transferred all of his stocks to his mother, Corinne Hardy, and had also, either on that date or sometime earlier, mortgaged certain personal property. On April 24th, Meriwether Hardy filed a substituted complaint, making Corinne Hardy a party defendant, and alleging that Robert Hardy’s business transactions with Corinne Hardy were “fictitious” and entered into for the purpose of defraud-iug her of her interests in his properties, and asking that “Corinne McCombs Hardy be required to release and permit to be transferred to plaintiff one-third of all personal property belonging to defendant -which is now in her custody.” Additional grounds for divorce were alleged at the same time. On May 7th, Corinne Hardy filed her answer, denying appellant’s allegations. On May 15th, appellant filed an amendment to her substituted complaint alleging that Hardy & Co., Inc., was a mere dummy, and was being used by Robert Hardy to cheat and hinder her in her efforts to obtain her dower rights. After several other pleadings had been filed by the parties, including a prayer that the court invalidate the pledge held by Corinne Hardy to one-third of the securities (representing the dower interest allowable to appellant), the case, on October 24, 1956, went to trial. After hearing the evidence relative to the divorce, the chancellor, on October 25th, appointed a special master, who was directed to inquire into the various holdings of Robert Hardy . . . stocks and other personal properties . . . realty owned by Hardy . . . rights of appellant in such properties . . . whether the assignments and mortgages from Hardy to his mother were valid . . . the validity of other transactions hereinafter referred to. On November 7th, the court entered its decree granting a divorce to appellant. Subsequent thereto, the master took testimony and filed his report with the court on December 5th, 1956. On December 28th, the court entered its decree adopting most of the conclusions reached by the master, and awarding appellant her statutory rights in both the personal holdings and realty of Robert Hardy, her dower rights in the stocks, however, being subject to a lien held by Mrs. Corinne Hardy. The decree, including land descriptions, covers twenty pages, and only the controverted findings will be hereafter discussed. Appellant’s notice of appeal lists twenty decretal orders contained in the decree which are contended to be erroneous, though some of these have now been waived, others are not argued, and the balance are covered in six points. Bobert Hardy appeals from fourteen decretal orders in tbe decree, though only four are argued.

Does the evidence reflect that Robert Hardy and his mother, Gorinne Hardy, entered into a scheme to defraud Meriwether .Hardy of her statutory rights in Robert Hardy’s personal property.1

This is by far the most important question, involving, as it does, approximately $90,000, and is the question given the greatest attention by all parties. The record is voluminous, covering testimony before both the Chancellor and the Master, and discussion here must necessarily be limited. Perhaps it would be well to first discuss the applicable law. In Merchants and Farmers Bank v. Harris, 113 Ark. 100, 167 S. W. 706, this Court, through Justice Wood, said:

“Without going into detail in discussing the above facts, arguendo, we are of the opinion that they clearly show that the conveyance from Harris to Hale was for the purpose of defrauding Harris’s creditors, and that Hale participated in such fraud. But if we are not correct in that, certainly the facts and circumstances were sufficient ‘to put a man of common sagacity upon inquiry, and with the use of reasonable diligence, to lead him to the discovery of the fraudulent purpose of the vendor,’ and Hale, having neglected to make inquiry that would have enabled him to discover the fraud, is, charged with notice thereof, and must be held to have assisted Harris in carrying out his fraudulent purpose.” In the old case of Singer v. Jacobs, 11 Fed. Rep. 559, tried in the Eastern District of Arkansas, the court went even further, saying:
“An actual agreement or conspiracy between Jacobs and Thompson that the latter, would aid the former to defraud his creditors does not have to be shown. It is sufficient to avoid the sale if the facts and circumstances within the knowledge of Thompson are such as fairly to induce the belief that he either knew of the fraudulent purpose of Jacobs, or, having good reason to suspect it, he purposely refused to make inquiry, and remained wilfully ignorant. A full consideration paid in cash will not protect a purchaser who has notice, actual or constructive, that the vendor is selling to hinder and delay his creditors; * * * . ”

We think the law is well expressed in the Maryland case, Oles Envelope Corporation v. Oles, 193 Md. 79, 65 Atl. 2d 899.

“There is unquestionably a difference between the claim of a wife upon her husband’s estate, and the claim of a wronged wife, who because of the misconduct of her husband becomes entitled to a divorce and has applied or is about to apply for alimony. * * *

A husband has the right to make a transfer of his property, either with or without consideration, even though he strips himself of all means of supporting his wife, and leaves her without the means of subsistence, provided that he does so in good faith and without intention of defrauding her of her just claims upon him and his estate. * * *

On the other hand, a conveyance made by a husband before and in anticipation of his wife’s suit for alimony, or pending such suit, or after a decree has been entered therein in the wife’s favor, to prevent her from obtaining alimony, is fraudulent and may be set aside, unless the grantee took in good faith, without notice and for value. The grantee’s knowledge of or participation in the fraud of the■ grantor must he gathered from the various facts composing the transaction and all the■ surrounding circumstances. * * *”

In determining whether the facts in this case are such as to come within the cases cited, we deem it appropriate to review the sequence of events.

January 20, 1956 — Robert Hardy and wife, Meri-wether Hardy, separated.

February 20, 1956 — Divorce suit filed by Meriwether Hardy.

February 24, 1956 — Hardy & Company was incorporated.

March 1, 1956 — Appellee was at the Mayflower Hotel in Washington, D. C.

March 1, 1956 — Corinne Hardy, mother of Robert, wrote to appellee saying she would advance up to $850,-000 to Hardy & Co.

March 4,1956 — Robert Hardy arrived in Little Rock.

March 6, 1956 — Chattel mortgages from Hardy to mother were signed.

Note, in the amount of $11,000, bearing date of December 9, 1955, executed between Hardy & Co. and Corinne Hardy, which appellant contends was not executed, or at least not collateralized, until March 6, 1956. There is apparent merit in this contention since the typing of the description of the securities pledged extends in part over the signature of Hardy, showing that the pledging of securities was written in after the note had been signed. The same is tx-ue of a note in the amount of $50,000, dated December 30, 1955, and the evidence reflects that Hardy was in Oregon on December 30th.

March 7, 1956 — -Answer to appellant’s complaint filed by Robert Hardy.

April 24,1956 — Substituted complaint filed by Meri-wether Hardy asking that Corinne Hardy be made a party defendant, alleging that Corinne Hardy and her son had entered into certain agreements designed to deprive appellant of her dower rights, asking that Corinne Hardy be required to release, for transfer to appellant, one-third of all personal property belonging to Robert Hardy and held by her, and asking that the mother be restrained from further encumbering the personal property belonging to her son.

May 7, 1956 — Corinne Hardy filed her answer denying she had entered into any arrangement with Robert devised for the purpose of depriving appellant of her dower rights, and asserting that she had entered into no contracts with her son since learning of the divorce action.

May 15, 1956 — Meriwether Hardy amended her substituted complaint asking that Hardy and Company be made a party defendant, and praying lien upon the assets of such company if the original prayer against Corinne Hardy not be granted.

Other pleadings were filed, but are not particularly pertinent to a discussion of this issue.

The testimony relating to Hardy’s holdings and various transactions was, in some instances, noteworthy for incongruity and lack of candor, and denoted such a departure from ordinary business procedure as to be almost unbelievable. One cannot read the testimony of Robert Hardy without observing that he was most evasive, either suffering from poor memory or unwilling to account for various expenditures. A good example is furnished by Hardy’s transactions with Marcus A. Brandjord and R. L. Adams, employees of Hardy & Company. Hardy was served with summons in the divorce suit on either February 20th or 21st. On February 21st, the evidence reflects that Hardy gave Brandjord a check in the amount of $6,000, made payable to Brand-jord. Brandjord endorsed the check and returned it to Hardy later in the day. Hardy cashed it. The same procedure was followed with Adams.

Hardy’s testimony relating to the transaction was as follows:

“Q. You did not place the $6,000 with either one of them, but you took the money?
A. That is right. When they would take a trip or they had call for it, I would let them use it.
Q. You didn’t put the money back in the bank, did you?
A. No, I don’t believe I did. I could have put some of it back. I don’t remember.
A. It was for when the banks were not open, holidays when we had to travel, if onr credit was questioned. We were a new corporation. Cash wonld be much better than a check or anything else, so — ■
Q. But yon handed the check, made payable to Brandjord, to him, and he endorsed it, and then yon took it down to the bank and got the money, didn’t yon?
A. Yes, that is correct.
Q. And what was the object in using Brandjord’s name?
A. Well, why not?
Q. Why didn’t you just make the check to cash and cash it at the bank?
A. I don’t remember what the reason was. I just did.”

This explanation seems rather “shallow,” and leaves ns unconvinced.

On May 15, Hardy drew $25,000 from the corporation without consulting any of his associates . . . there was no resolution by the board of directors authorizing the money to be taken from corporate funds . . . no vouchers showing what the money was to be used for. The evidence reflects that $18,000 was redeposited shortly, but $7,000 was not satisfactorily accounted for. The handling of this amount of money seems quite unorthodox. From Hardy’s testimony:

“Q. What did you do with the $25,000 you withdrew from Hardy & Company?
A. I put it back in the bank at various times, and used it for Hardy & Company in various ways.
Q. Where did you keep it while you had it before you put it back in the bank at various times?
A. Where did I keep it. I kept it in the safe. I could keep it in a lock box.
Q. Do you mean to tell this court you took $25,000 out of Hardy & Co., Inc., and put it in a lock box somewhere ?
A. I could put it in another account. I can’t remember back that far. You know we got into that once before.
# # *
Q. You don’t know whether you put it in cash or put it in another bank?
A. No, sir.
Q. Why did you take it out?
A. I had a good reason for it at the time.
# # *
Q. Now the date is May 15th. Will you tell us now why you withdrew it?
A. May, 15th ?
The Master: Just say you can or cannot.

The Witness: I just told him I could not remember.” These instances are illustrative of a course of conduct, hereinafter more fully discussed in conjunction with the acts of the mother, which convinces us that Hardy had every intention of hiding his assets; that Hardy & Co. funds were considered by Hardy as available for his personal use, and that his primary purpose was to prevent his wife from acquiring her statutory rights in his properties.

What are the circumstances relative to whether the mother, Mrs. Corinne Hardy, participated in the scheme with Bobert? Let it first be said, as argued by appel-lee, that there is no doubt but that as far back as 1954, the Hardys had contemplated building a hardboard manufacturing plant. It does appear, however, that the original plan contemplated the participation of the entire family in the venture. In a letter dated February 9, 1955, the attorney for Mrs. Hardy wrote a St. Louis bank that4 ‘ The Hardy family is considering entering into a business venture * # *. You doubtless are familiar with some of the securities and property Miss Hope Hardy owns, but Mrs. Hardy doubts if you have any specific information about ber personal holdings or the personal holdings of her son, Robert.” The fact that such a project had been previously contemplated is not disputed by appellant, but it is argued that, subsequent to the filing of the divorce, the original plan was changed, i. e., instead of the construction and operation of such plant being a family venture, it suddenly became the venture of Robert Hardy. It is argued that everything Hardy owned was pledged to his mother in an effort to remove said properties from the reach of his wife. We will have to say that it does appear he pledged or mortgaged substantially all assets. For instance, after having pledged all of his securities, he proceeded, on March 6th, to mortgage a Buick, Cadillac, and Dodge 2-ton truck. Another mortgage of the same date included a Chris-Craft motor boat, a riding horse, horse trailer, bridles, saddles, furniture, furnishings, kitchen and household appliances, silverware, dishes, glassware, and all other household effects. It is difficult to see the necessity of mortgaging household appliances, dishes, etc., as this could not have added a great deal as security for $850,000, and actually, this occurrence lends considerable momentum to appellant’s argument ■ — ■ and influences us to no small degree. The Master found that the mortgage on these “chips and whetstones (so characterized by the Master in comparison to the debt secured) is not natural nor normal, and leads' to the conviction that the mortgages were not given as security. I find that the mortgages are not encumbrances on plaintiff’s portion of the described property. * * *” This holding was adopted by the trial court, and we fully agree. The Master, however, and court, found that the delivery of the securities, on the same date, was entirely bona fide. Though in holding the mortgages invalid, the Master made no finding that same were executed with the intent of defrauding appellant of her dower, it seems clear that such a conclusion would necessarily follow. The mortgages were given for some purpose — if not for security, then for some other reason — and no other reason has been advanced except the obvious one. It appears, therefore, that Robert Hardy and his mother had the intent to place the properties mentioned in the mortgages beyond the reach of appellant. Since it is concluded that such a thought was in their minds concerning lesser properties, it seems illogical to conclude that no such thought entered their minds in pledging major properties.

The speed with which the transaction was handled following the filing of the divorce action is potent evidence in behalf of appellant. Though the plant had been contemplated for at least a year, the essential and necessary steps in organizing the corporation and in financing the construction of same, including the pledges and mortgages given by Robert Hardy, took place in a period of less than two weeks — all subsequent to the filing of the divorce complaint.

Mrs. Hardy filed an answer stating “that she has entered into no contracts with her son since she learned of the filing of the divorce herein. ’ ’ Appellant testified that Corinne Hardy formerly called her every day, but, as of the time of the separation in January, the mother ceased calling, and Meriwether Hardy heard no more from her after that date. We think this significant, though it, of course, standing alone, establishes nothing. It does strain credulity to believe that this son, though apparently very close to his mother, would not have mentioned to her that his wife had filed suit for a divorce, the evidence reflecting that they had conversed together over long distance subsequent to the filing of the divorce complaint, and before his return to Little Rock on March 4th. It also seems that in taking a chattel mortgage on wedding presents and household goods, a mother-in-law, normally, if acting in good faith, would make some inquiry as to the possible reaction of her daughter-in-law. At any rate, it is clear that additional security was sought to he taken after the litigation was well under way. Hardy is the owner of valuable lands, and according to his testimony, learned (during the taking of his discovery deposition on March 30th by appellant’s attorney) that he could mortgage these lands, subject to his wife’s dower interest. Mrs. Hardy was informed of this fact, and on March 31st wrote a letter to Robert asking that these lands be mortgaged .to her as additional security. On the same date, he advised her by mail that he was willing to do so. The formality of letter writing between mother and son in regard to the mortgage, indicates that the letters were exchanged for the purpose of getting this agreement “on record,” particularly since both letters were written on the same date. The record does not reflect that this mortgage was ever given, though it might be argued that the agreement constituted an equitable mortgage. If an equitable mortgage is effectuated by the agreement, appellant, of course, would be unable to collect a money judgment against Hardy through execution. An opposite fact, to us, which relates to whether Mrs. Hardy had knowledge of the divorce action, was her failure to testify at any time during the trial. It is apparent that some of the transactions herein mentioned required an explanation. If these transactions were entirely tona fide, it would appear that Mrs. Hardy would have presented her testimony to the court, relating pertinent facts concerning events dating from the inception of the plan to construct the plant . . . the original participants . . . when Mrs. Hardy elected not to participate . . . Avhy it was decided that Robert would be the only member of the family engaged in the business . . . when it was determined that Robert should pledge his securities as collateral . . . why a mortgage was taken on all personal belongings and household equipment . . . the necessity for the agreement to give the real estate mortgage . . . when she learned of the separation ... of the filing of the divorce complaint . . . the reason for suddenly terminating her daily conversations with appellant. No reason is shown as to why Mrs. Hardy did not testify, and under the circumstances, we feel that such failure raises a presumption that she felt the various transactions could not he sustained under a vigorous and searching cross examination. It is concluded that the proof meets the requirements set out in the cases heretofore cited, and the answer to the question asked at the beginning of this discussion is “Yes.”

The Rice-Hardy Partnership. In October, 1955, Hardy entered into a contract with one Jack Rice, whereby they purchased some rural property. Hardy paid $6,000, and assumed a mortgage in the amount of $7,000. It was agreed between Rice and Hardy that when the property was sold, any amount in excess of $13,000 would be divided equally between them. Rice located a purchaser in the summer of 1956, who offered $21,000 for the property. Corinne Hardy issued her check, dated April 4, 1956, in the amount of $6,000 to her son, and assumed the mortgage. Appellant contends that this was but another phase of appellees’ determination to conceal all of the assets of Robert Hardy, and that she is entitled to one-third of Hardy’s part of the profit. ’ The check was cashed on August 16th, and Hardy gave no reasonable explanation of why he waited so long to cash it. It is immaterial, however, as to whether the check was given in April or August, since both occurred sometime after the filing of the divorce complaint. While this transaction, particularly viewed along with those already mentioned, has a suspicious appearance, we are unable to say that the chancellor’s holding was contrary to the weight of the evidence, and appellant’s claim is denied.

Appellant Was Entitled To Expenses Incurred in the Talcing of Depositions. Numerous depositions and discovery depositions were taken, at the cost of $1,356. The court found:

“The claim of plaintiff for $1,356 for depositions and for the services of out of town attorneys is denied for the reason that prior to the incurring of such expense the defendant offered not to contest a decree for divorce on the ground of indignities to the person of plaintiff. ’ ’

It is admitted that Hardy did so agree, but appellant alleged that Hardy had also agreed she should have the dower rights to which she was entitled under Arkansas law; that she learned he was disposing of his property and encumbering same, and that his promise was not made in good faith. We think Meriwether Hardy was entitled to present her proof, and the depositions were helpful to her cause. We feel that the court was entitled to the knowledge of Hardy’s conduct as an aid in determining questions of alimony and proper orders for child custody; furthermore, part of the contents of the depositions related to the use of corporate funds by Hardy, and other matters relating to his finances. Since the depositions were pertinent to the issues involved, it follows that the court erred in not allowing this claim for reimbursement.

The Euclid Smith Transaction. Hardy testified before' the Master that Dr. Euclid Smith owed him $10,000, and on this testimony, the Master gave appellant a one-third interest in said debt. Later, both Hardy and Dr. Smith contended that the debt had been paid. Hardy’s testimony relative to the transaction is rather evasive and unsatisfactory. Dr. Smith did not remember the date of repayment, but stated he made two payments of $5,000, each in cash, at the Albert Pike Hotel. Under the advice of his attorney, he refused to state where he had obtained the cash, or the reason- for borrowing the money from Hardy. The chancellor held that the debt had not been repaid, and we are unable to say such finding is erroneous. However, the trial court rendered a cash judgment against Robert Hardy for $3,333.33 (representing one-third of the debt), and this was error; having found that the debt had not been paid, the court only had the right to give appellant a one-third interest in same.

Other points are raised by both appellant and ap-pellees, and two of appellant’s points will be hereafter discussed under the heading, “Summary.” A discussion of the others would unduly prolong the opinion, and serve no good purpose. We have carefully considered each point not herein discussed, and find no merit in same.

SUMMARY

Robert Hardy had personal properties of the value of nearly $300,000 at the time this lawsuit was filed. At the time the decree was rendered, his unpledged assets had diminished to the point that his wife only received absolutely, approximately $4,500, clear of any pledge. As stated, we have concluded that Hardy and his mother entered into a scheme to deprive appellant of her statutory rights in Hardy’s properties. Unquestionably the hardboard manufacturing plant had been considered for some time before the separation of Hardy and his wife, and the project itself was completely bona fide. The evidence reflects that the full $850,000 went into the project. It does seem odd that Mrs. Hardy, at the outset, did not require a mortgage from Hardy & Co., securing advances made and to be made, immediately upon the company’s acquiring the plant, site (though advised to do so by her attorney). This had not been done at the time of the trial, though the master held that the company’s promise to do so constituted an equitable mortgage. We are convinced that the original plan was changed and subsequently developed in a manner to prevent appellant from acquiring her dower. In other words, it was a matter of “ killing two birds with one stone.”

The decree is reversed and remanded with the following directions:

1. As to the stocks and bonds, appellant should be awarded her dower in these securities, free of any claim of Corinne Hardy. It may well be that these securities have been pledged by the mother to innocent third parties as security for some portion of the amount advanced by her to Hardy & Co. In such event, appellant should bo given judgment against Robert L. Hardy for the full amount of lier dower and permitted to enforce same by-execution against Hardy’s lands. As far as the record shows, no mortgage had been given by Hardy to his mother on these lands at the time of the decree. Only the letter had been written agreeing to mortgage same. We are not presently concerned with whether the agreement constitutes an equitable mortgage between the two ap-pellees, but if the securities are now beyond the reach of appellant, her right to levy on the lands is paramount to any claim by Corinne Hardy. Under these findings, it is not necessary to discuss appellant’s right to a lien against the assets of Hardy & Company. This is a matter that would be properly heard by the court if the real estate is also presently encumbered so that Meri-wether Hardy would be unable to enforce her judgment by execution. It follows that appellant is not presently, under these findings, entitled to any stock in Hardy & Company.

2. Item 18 of the decree (disallowing appellant’s claim for costs of depositions and out-of-town attorneys) is reversed, and the chancellor directed to allow this item.

3. Appellant’s attorneys were awarded a fee of $2,000, which is considered inadequate, particularly under the result we have reached. Appellant’s attorneys will be awarded an additional fee of $3,000 or a total of $5,000.

• 4. Appellant is awarded a one-third interest in the Euclid Smith indebtedness.

5. The order allowing appellant $262.50 per month for temporary alimony shall remain in effect until such time as appellant’s award of dower, herein set out, shall be satisfied in full.

In all other respects, the decree is affirmed.

George. Hose Smith, J., not participating.

       Hardy & Co., Inc., was incorporated on February 24th, with a capital of $300.

       Emphasis supplied.

       The Master and Chancellor awarded appellant the Buick.

       The horse and horse trailer were awarded appellant. At the time the horse was given to her, Hardy gave her a note which said: “Happy Birthday. Bought you Bayon. Love, Animal.” He contended this was not a valid gift because he had signed it “Animal” instead of using his name.

       As of the time of the trial, the sale had not been completed:


author: J. Seabork Holt, Associate Justice. Paul Ward, Associate Justice,

text:
    Wallace v. Ayres, Excx.
    5-1524
    311 S. W. 2d 758
    Opinion delivered April 7, 1958.

      Ed B. Coók, for appellant.

      Bruce Ivy, for appellee.
   J. Seabork Holt, Associate Justice.

This litigation involves the title to a small piece of land in what is commonly called “Old Town” in Osceola, Arkansas. Appellant, Mrs. Wallace, claimed title to a part of the property through deeds from Ollie Mae Feezor, dated February 24, 1945, and guardian’s deed from Emma Feezor, guardian of the person and estate of Mary Elizabeth Feezor, dated February 19, 1945. This part designated as Lot 11 Humphreys Addition was described by metes and bounds as follows: “Beginning at the township line dividing Township 12 and 13 on the east line of Main Street to south and in line with the west line of the lots owned by and resided on now by G. W. Boyce and the lot owned by the heir of Mary J. Walker, thence south 58 and a half feet to a stake, thence east 71 feet and 9 inches to a stake, thence south 31 feet and 6 inches to a stake, thence east to the Mississippi River, thence up and along the bank of the Mississippi River to the township line dividing Township 12 and 13, thence west of the point of beginning; it being a part of the southwest frl. quarter of Section 6, in Township 12 North and Range 10 East,” is not in dispute and was conceded to be owned by appellant. Appellant, however, claimed that she bad acquired title by adverse possession to the small tract lying immediately sontb of Lot 11 and bounded on the east and south by the Mississippi River levee. Appellees also claimed this property and denied that appellant had acquired title by adverse possession for the statutory peiiod of seven years. The trial court found this issue of adverse possession in favor of ap-pellees and from the decree comes this appeal.

The sole question presented is whether appellant has established her claim of adverse possession by a preponderance of the testimony. After a careful review of the record presented we have concluded that appellant’s claim of adverse possession has been sustained by her.

It appears that twelve witnesses testified in appellant’s behalf and four for appellees. Four of appellant’s witnesses were related to her. Appellant, Mrs. Wallace, testified that she and her husband (who died March 10, 1954) purchased the property from the Feez-ors in 1945; they knew nothing about the property before purchasing; the Feezors pointed out to them the boundary lines of the land which they claimed and were conveying to appellant. The land, she claimed, she and her husband bought fronted on Keiser Avenue east and west for a distance of about 107 feet to the levee. The levee is the east and south boundary line of the property for 300 feet. Going south the levee jogs (or curves) to the west boundary of the property to the toe of the levee. The Feezors told them that the property “ran clear to the levee.” She and her husband had a garden on this property and also a chicken pen, have lived on it and claimed ownership since 1945 and “nobody questioned our ownership while Mike (her husband) was alive.”

Walter Garner (appellant’s son-in-law) testified that he first became familiar with this property in 1946, knew where the lines were; that it measured 107 feet on Keiser Avenue and 300 feet from Keiser Avenue south to the levee; that Mrs. Wallace claimed the property and worked it ever since he had known the property, and that neither Clay Ayres nor anybody else had worked that property since then. “Q. That is all she claims is what she bought from the Feezors? A. No, sir. She is claiming all of it. Mr. Clay Ayres said it was not his. Q. He said what was not his? A. That land back there that the dispute is over.”

Mrs. Bay Phillips (not related) who had lived about 17 years in Old Town (had known this property for 16 years) and was acquainted with the Feezors, testified that the Feezors took care of and worked the land in question, that they raised corn on the land and that she had bought corn from them; that Mrs. Wallace also worked the same property that the Feezors worked. ‘ ‘ Q. And Mr. Ayres has farmed it since he bought it in 1926 ? A. He has not put a plow in it as long as I have known it.”

C. E. Sledge (not related) testified he did not know the Feezors but has known the Wallaces for ten years, since shortly after he came to Osceola, that he lived about a block from them. He did not know the size of Mrs. Wallace’s lot, but knew what land Mrs. Wallace and her husband had in their possession. They had possession of all the land east of what would be Main Street if it crossed Keiser and went south to the levee, about 300 feet. Nobody has ever claimed or worked this property for the past ten years except the Wallaces. R. J. Fox, George Hall, and Herschel Coleman, all unrelated, corroborated the testimony of Mrs. Wallace in all material respects.

The testimony of the four witnesses presented by appellees tended to contradict the testimony of appellant’s witnesses. We do not attempt to detail this testimony, however, it suffices to say, as indicated, that we have concluded that the preponderance of all the testimony relating to acts of use, possession and ownership by appellant supports her claim of title to the property by adverse possession.

The requirements of the law with reference to adverse possession are well established in this state, “In order that adverse possession may ripen into ownership, possession for seven years must be actual, open, notor-ions, continuous, hostile, exclusive, and it must be accompanied with an intent to hold against the true owner .. . Adverse possession is one of the modes of acquiring title to property . . . It is said to be a possession which is commenced in wrong and continued in right. Again, it has been defined as the ripening of adverse possession into title by lapse of time. A title acquired by adverse possession is a title in fee simple, and is as perfect a title as one by deed from, the original owner or by patent or grant from the government . . . to constitute an adverse possession, there need not be a fence or buildings, yet there must be such visible and notorious acts of ownership exercised over the premises continuously, for the time limited by the statute, that the owner of the paper title would have knowledge of the fact, or his knowledge may be presumed as a fact. In other words, it has been well said that if the claimant ‘raises his flag and keeps it up’ continuously for the statutory period of time, knowledge of his hostile claim of title may be inferred as a matter of fact,” Stricker v. Britt, 203 Ark. 197, 157 S. W. 2d 18. “Possession which is so open, visible, and notorious as to give the owner constructive notice of an adverse claim need not be manifested in any particular manner; but there must be such physical evidence thereof as reasonably to indicate to the owner, if he visits the premises and is a man of ordinary prudence, that a claim of ownership adverse to his is being asserted.” Terral v. Brooks, 194 Ark. 311, 108 S. W. 2d 489.

For the error indicated the decree is reversed, and the cause remanded to enter a decree consistent with this opinion.

Ward, J., dissents.

Paul Ward, Associate Justice,

dissenting. I am unable to agree with the majority opinion. My reasons for dissenting will be briefly stated.

One. The Chancellor held that appellant and her predecessors in title did not show title by adverse possession to all of the land she claimed. The Chancellor, under the well established rule of this court, should be affirmed unless his holding is against the weight of the evidence.

Two. The husband of appellant in 1945, received a deed to Lot 11, Humphrey’s addition, Osceola. She has lived in a house on this lot, and also raised a garden thereon, ever since. It is conceded, as held by the Chancellor, she owns that parcel of land. However she claims, in this litigation, more land by adverse possession. As to this additional land, the Chancellor held, and I agree, she failed to show the necessary acts of possession.

The land claimed by appellant is bounded by a levee on the east and south and on the north by Keiser Avenue. There is no legal description of the west line of the property, but appellant claims about 107 feet frontage on the said avenue. The distance from the avenue to the levee on the south is about 300 feet.

Three. The great weight of the testimony as I view it, proves: Lot 11 covers only a portion of the land appellant claims; Lot 11 does not run south to the levee; she has no color of title to the expess land, and; she has not paid taxes on the excess land.

Four. Under the above state of facts it was encum-bent on appellant to prove she exercised actual, pedal possession of the excess land. See: Mooney, et al. v. Cooledge, et al., 30 Ark. 640; Sturgis v. Hughes, 206 Ark. 946, 178 S. W. 2d 236; Miller v. Kansas City Southern Railway Co., 216 Ark. 304, 225 S. W. 2d 18, and; Griffin v. Isgrig, 227 Ark. 931, 302 S. W. 2d 777.

Not only was the Chancellor’s holding supported by the evidence, but there is no definite testimony that appellant actually occupied all of the excess land which she claimed and which the majority opinion gives her.


text:
    Thornbrough, Comm’r. of Labor v. Schlenker.
    5-1503
    311 S. W. 2d 753
    Opinion delivered April 7, 1958.

      Lulce Arnett, for appellant.

      Tom Gentry, for appellee.
   Ed. F. McFaddiN, Associate Justice.

This appeal presents the question, whether certain employees are entitled to unemployment benefits during the week when the plant was shut down. The employees (appellees here) claimed that during such week they were “unemployed through no fault of their own” (being the words in § 81-1101 Ark. Stats, as amended by Act 155 of 1949). The appellant claims that the appellees were “voluntarily unemployed” and thus not entitled to the benefits of the Arkansas Employment Security Act (see § 81-1101 Ark. Stats, and amendments).

The appellees were employees of International Shoe Company (hereinafter called “Shoe Company”) at its plant in Malvern, Arkansas, and were members of Local Union No. 2665 of the United Textile Workers of America (hereinafter called “Union”), which was the bargaining agent for the appellees. The Union and the Shoe Company had a contract which provided that employees who had worked a specified minimum time would he entitled to paid vacations. There was no provision in the contract whereby the Shoe Company had the right to close its entire plant at any time it desired and require all employees to take their vacations at that time. On June 24, 1954 the Shoe Company posted a notice to its employees:

“The plant will close July 2, 11 P. M. for vacation week; will begin regular operations Monday, July 12. Those eligible for vacation at that time will be given vacation checks on July 2.”

Seventeen of the appellees had not been employed by the Shoe Company long enough to qualify for vacation pay; and the other seven of the appellees had already taken their vacations with the consent of the Shoe Company; so that these twenty-four appellees, through no fault of their own, were out of employment during the entire work week ending July 10, 1954. They duly filed for unemployment compensation benefits under the Arkansas Employment Security Act. There is no claim that the appellees failed to comply with the registration and availability requirements of the Act: the sole issue is whether the plant wide vacation shutdown by the Company rendered the appellees entitled to benefits as being-unemployed. The Arkansas Employment Security Act provides in § 81-1103 (m), as amended by Act 155 of 1949, ‘ ‘ An individual shall be deemed ■ ‘ unemployed ’ with respect to any week during which he performs no services and with respect to which no wages are payable to him, or with respect to any week of less than full time work if the wages payable to him with respect to such week are less than his weekly benefit amount.”

The appellees performed no services and received no wages in the week ending July 10, 1954; but appellant claims that the contract between the Union and the Shoe Company provided for vacation periods, and that because of such provisions in the contract the appellees were voluntarily unemployed. Thus the sole issue is whether the contract between the Union and the Shoe Company placed the appellees in the status of being voluntarily unemployed. The claims of the appellees went through the regular administrative procedure, and the Board of Review, by a divided vote, allowed the claims of the appellees for the said week in question. The Circuit Court affirmed the awards made by the Board of Review; and the Commissioner of Labor prosecutes this appeal in order to obtain a definitive ruling on the point at issue.

There are a number of cases from other jurisdictions on the identical question here posed. To review all such cases would unduly prolong this opinion. Instead, we quote from the Annotation in 30 A. L. R. 2d 366, entitled, “Right to unemployment compensation as affected by vacation or holiday or payment in lieu thereof.” This Annotation states:

“As a rule, whenever a vacation takes the form of a general plant shutdown for the vacation period, some employees are ineligible for vacation pay because of failure to meet the minimum service requirements of the contract. Whether such employees should be regarded as on vacation or unemployed within the meaning of the unemployment insurance laws, presents a perplexing problem which has led to varying decisions in the courts . . . . In the following cases, unpaid workers involved in a general shutdown of their place of employment for the purpose of giving paid vacations to those eligible have been held not entitled to benefits for the vacation weeks.”

The cases referred to are from Massachusetts, Minnesota, New York, Pennsylvania, and Washington. The Annotation continues:

“Other courts have held that an employee who fails to qualify for a paid vacation under the terms of the applicable contract should be regarded not as on vacation, but as -unemployed, and therefore entitled to benefits for the period of a vacation shutdown. ’ ’

The cases referred to are from Connecticut, Indiana, Michigan, and Pennsylvania.

It is impossible to reconcile all of the various cases. A reasonable distinction between the two lines of decisions might be this: if, by the contract between the Union (the agent of the workers) and the management of the plant, there was reserved by the management of the plant the right to fix, at its own option, a plant wide vacation period, then the employees had agreed to such vacation and had been “voluntarily unemployed”; and, therefore, not entitled to employment benefits. But if the contract had no provision whereby the management reserved the right to fix, at its own option, a plant wide vacation shutdown, then the employees had not agreed to such vacation period and were “involuntarily unemployed” during such shutdown period; and, being involuntarily unemployed, they were entitled to unemployment compensation.

In the contract between the Union and the Shoe Company, in the case at bar, there were some provisions concerning vacations, such as: (a) “All vacations shall be taken between June 1st and December 31st of each year and must be arranged for in advance with the foreman . . .”; (b) “Vacations will be granted only at times when the Company can spare the services of the employees and still .obtain production requirements . . .”; and, of course, there was the provision (c) that “. . . the management of the Company’s plants and the direction of the working forces ... is vested exclusively in the Company . . .” But the provisions in the contract in the case at bar did not provide for a plant wide vacation shutdown period, as was the situation in the contracts in such cases as Adams v. Review Board (Ind.), 143 N. E. 2d 564, and I. M. Dach Underwear Co. v. Michigan Employment Sec. Commission, 347 Mich. 465, 80 N. W. 2d 193. "We reiterate that in the case at bar there was no provision in the contract looking toward a plant wide vacation shutdown period at the option of the management.

We hold that under the contract between the Union and the Shoe Company, here involved, these twenty-four appellees are entitled to unemployment compensation benefits for the week ending July 10, 1954. This is true because there was no provision in the contract whereby the Shoe Company had the right to close down its entire plant for a vacation period at any time it elected and thereby force the appellees to take vacations at such time, even though some of them had not worked long' enough to be entitled to vacations, and others had taken their vacations with consent of the management.

Affirmed.

       There are twenty-four appellees, being, W. C. Sehlenker, Aubrey Stancy, Lindal Baker, HuVaughn Fitzhugh, George Taylor, Bonnie Hiatt, Catherine Greene, Homer Myers, Travis Beeves, Arvil Hudson, Louise Bost, Bufus Pearson, Herman Parker, Jewell Burris, William Abbott, Marshall Davis, Maydean Gregory, Willis Diffee, Carl Hanley, Mildred Hanley, Cecil Bichardson, Agee McDonald, Hazel Hardage and Lola Davenport.

       In Little Rock Furn. Mfg. Co. v. Comm. of Labor, 227 Ark. 288, 298 S. W. 2d 56, we stated the various steps of the administrative procedure.

       In the supplementary volumes, later cases are listed as involving the same point.


text:
    Concrete, Inc. v. Arkhola Sand & Gravel Co.
    5-1517
    311 S. W. 2d 770
    Opinion delivered April 7, 1958.

      Hardy W. Groxton, for appellant.

      Wade i& McAllister and Daily & Woods, for appellee.
   Minor W. Millwee, Associate Justice.

The plaintiff-appellant, Concrete Inc., is an Arkansas Corporation with its office and plant located in Rogers, Benton County, Arkansas, where it engages in the sale of ‘ ‘ ready mixed” concrete in and around that city. The defendant-appellee, Arkhola Sand and Gravel Co., is also a domestic corporation with its principal place of business at Fort Smith, Sebastian County, Arkansas and branch offices in "Washington and Crawford counties.

On July 9, 1957, plaintiff filed suit against defendant in the Chancery Court of Benton County alleging: “That the defendant, Arkhola Sand and Gravel Co. is a duly authorized Arkansas Corporation. That said defendant has offices and plants at Fort Smith and Fay-etteville, Arkansas. That the prices it charges for ‘ready-mixed’ concrete is a standard and uniform one within its territory except within the Rogers and Spring-dale territory. That the prices charged for its concrete in the aforesaid Rogers and Springdale territory are at lower rates than those charged in other sections and cities served by defendant, after making allowance for transportation, grade, quality, and quantity, and that the sale of said concrete is made with the intent to destroy the competition of plaintiff, a regular established dealer in such product.

“That as a result of defendant’s actions, the said Arkhola Sand and Gravel Co. has caused the plaintiff to suffer in excess of $10,000 damages, and for which it is entitled to treble damages.

“That said defendant, Arkhola Sand and Gravel Co. has further by collateral contract and other devices prevented the plaintiff from purchasing concrete materials from certain suppliers, whereby said plaintiff has been compelled to purchase said supplies at a higher price than otherwise would have been paid; and that said device was used with the intent to destroy the competition of the plaintiff.

‘ ‘ That snch collateral contracts and devices have injured and damaged the plaintiff herein in the sum of $8,500, and for which the plaintiff is entitled to treble damages.”

The prayer of the original complaint was for judgment against defendant for three times the sum of $18,-500 and an injunction restraining it from charging the alleged lower rates or prices for its concrete within the Rogers and Springdale trade territory.

A summons directed to the sheriff of Sebastian County was served on defendant’s president at its offices in Fort Smith prior to July 13, 1957, when the defendant appeared specially and filed its demurrer alleging it had no place of business or branch office in Benton County and objected to the venue and lack of jurisdiction of the Benton Chancery Court over its person under such service of process. On July 20, 1957, a hearing was held on the defendant’s demurrer to the venue and jurisdiction at which certain stipulations of fact were entered into and incorporated in a court order which included the agreement that defendant did not maintain an agent, place of business or branch office in Benton County.

On August 1, 1957, plaintiff filed an amended complaint which, in addition to the allegations of the original complaint, further alleged: “That the defendant herein has sold its manufactured products at a greater cash value at some points in this state than at other points in said state after making due allowance for difference in cost of carriage or other necessary cost. That plaintiff herein is entitled to recover a further forfeiture from said defendant of not less than $200.00 nor more than $1,000 dollars.” The prayer of the amended complaint also asked for an additional penalty against defendant of not less than $200.00 nor more than $1,000.

The instant appeal is from an order entered on September 11, 1957, sustaining the demurrer to the venue and jurisdiction of the Benton Chancery Court over defendant’s person and dismissing the complaint. Plaintiff insists the court’s action is contrary to our venue statutes.

It is clear from the allegations of the original complaint that it was based solely upon an alleged violation by defendant of Act 253 of 1937 (Ark. Stats., Secs. 70-301 eb seq.) which is known as the “Unfair Practices Act.” This act prohibits the sale of any commodity, product or service at a lower rate or price in one portion of the state than it is sold by the same vendor in another part, after making certain allowances for differences in transportation costs, etc., with the intent to injure or destroy competition. Since the act contains no venue provisions the action against defendant is governed by Ark. Stats., Sec. 27-605 which fixes venue for actions against domestic corporations. In construing this statute along with Ark. Stats., Sec. 27-347 we have consistently held that a domestic corporation must be sued in the county in which it is situated or has its principal office or business, or in which its chief officer resides, or in a county where it has a branch office or other place of business, by service of process upon the agent or employee in charge thereof. Fort Smith Lumber Co. v. Shackleford, 115 Ark. 272, 171 S. W. 99; Duncan Lumber Co. v. Blalock, 171 Ark. 397, 284 S. W. 15. According to the pleadings and stipulations the defendant’s principal place of business is in Sebastian county with branch offices in Washington and Crawford counties. It has no place of business in Benton county and none of its officers reside there. Hence an action against defendant under Act 253 of 1937 was not maintainable in Benton county and service of process on it in Sebastian county was properly quashed insofar as that act is concerned.

It is also clear that, by the amendment to the original complaint, plaintiff attempted to charge defendant with a violation of Act 183 of 1903 (Ark. Stats., Secs. 70-120 to 122). The first section of the act makes it unlawful to sell any manufactured product, coal oil or dressed beef at a greater cash price at any place in this state than at other points therein after making cine allowance for certain differences in transportation costs, etc. The second section fixes a penalty of $200.00 to $1,000 for each offense committed and the third section (70-122) provides that actions under the act may be brought “in any county in which the offense was committed . . .” In considering plaintiff’s contention that this section fixed the venue in Benton county it should be noted that the amended complaint does not charge that the defendant sold its concrete at a greater price in Benton county than at other points. On the contrary the gravamen of the charge is that plaintiff was damaged by defendant selling its product at a lower price in Benton county than at other points. It is also apparent that under the 1903 act the Legislature intended to protect purchasers of the chattels mentioned from being overcharged while the intent of Act 253 of 1937 was primarily to afford protection to the competitor of a seller, which is the nature of the relief sought by plaintiff. So we conclude that plaintiff is not in position to invoke the venue provisions of the 1903 act.

Nor do we agree with plaintiff’s further contention that venue of the instant suit lies in Benton county under the first subdivision of Ark. Stats., Sec. 27-602. This subsection provides that an action for the recovery of a fine, penalty or forfeiture imposed by statute must be brought in the county where the cause, or some part thereof, arose, except that where the offense was committed on a water-course or road which is the boundary of two counties, it may be brought in either of them. In Chicago R. I. & P. Ry. Co. v. Miller, 103 Ark. 151, 146 S. W. 485, the court held that this subsection applies only to penal actions instituted by the State for the benefit of the public and not to private actions against a wrongdoer like the instant proceeding. We still consider this to be a proper construction of the statute and adhere to it.

The trial court correctly concluded that venue of the instant suit was improperly laid in Benton county and that it was without jurisdiction of the person of the defendant. Its action in sustaining the demurrer and dismissing the complaint is, therefore, affirmed.

       All italics supplied.