author: Darrell Hickman, Justice.

text:
    Alfred D. HARKNESS v. A. S. (Todd) HARRISON, Judge, Crittenden County Circuit Court
    CR 79-54
    585 S.W. 2d 10
    Opinion delivered June 18, 1979
    (Division I)
    [Modified on Rehearing September 10, 1979.]

      Thomas G. Montgomery, Public Defender, for petitioner.

      Steve Clark, Atty. Gen., by: Robert J. DeGostin, Jr., Asst. Atty. Gen., for respondent.
   Darrell Hickman, Justice.

Alfred D. Harkness has Filed with us a petition for a writ of prohibition directed to the Honorable A. S. (Todd) Harrison, Judge of the Circuit Court of Crittenden County. A writ of prohibition will be granted.

Harkness was arrested on June 5, 1977, and charged with three separate felonies. He was tried on one of these charges in February, 1978, found guilty and sentenced to the penitentiary where he has remained since.

The other two charges were set for trial March 20, 1979. Before trial, Harkness filed a motion to dismiss the charges because of a lack of a speedy trial. The trial judge overruled the motion and Harkness seeks from us a writ to prohibit his trial.

The question presented is, has Harkness been brought to trial in compliance with Rule 28 of the Arkansas Rules of Criminal Procedure? Rule 28.1 (a) provides:

Any defendant charged with an offense in circuit court and committed to a jail or prison in this state shall be brought to trial before the end of the second full term of the court, but not to exceed nine (9) months, from the time provided in Rule 28.2, excluding only such periods of necessary delay as are authorized in Rule 28.3.

In order to determine if Rule 28 has been followed we must first examine the circuit court terms of Crittenden County and how they relate to this case.

Crittenden County Circuit Court is comprised of three divisions, designated First, Second and Third. The First Division judge presides over cases assigned to the criminal docket, the other two divisions are assigned to the civil docket. Ark. Stat. Ann. § 22-3229, et seq. (Repl. 1962). Regardless of the statutory designation of divisions, there is but one circuit court of Crittenden County. We have held, in connection with the Crittenden County Circuit Court, that in construing Ark. Stat. Ann. § 43-1708, which was replaced by Rule 28 of the Arkansas Rules of Criminal Procedure, we will treat the divisions of circuit court the same. State v. Knight, 259 Ark. 107, 533 S.W. 2d 488 (1976). In other words, the terms of court of each division will be counted when Rule 28 is in issue. (Act 432 of 1977, effective January 1, 1979, abolished the laws distinguishing civil and criminal divisions. However, it did not affect the terms of circuit courts.)

The parties stipulated to the terms of the three divisions as follows:

DIVISION I.
Arrested during February, 1977 term
September, 1977 term commenced September 20, 1977
February, 1978 term commenced February 20, 1978
September, 1978 term commenced September 18, 1978
February, 1979 term commenced February 19, 1979
DIVISION ¡I.
Arrested during January, 1977 term
November, 1977 term commenced November 21, 1977
January, 1978 term commenced January 30, 1978
November, 1978 term commenced November 20, 1978
January, 1979 term commenced January 22, 1979
DIVISION III.
Arrested during May, 1977 term
June, 1977 term commenced June 20, 1977
May, 1978 term commenced May 8, 1978
June, 1978 term commenced June 19, 1978

It can readily be seen that unless excludable periods preclude the application of Rule 28, then Harkness has not been timely brought to trial.

The State argues Rule 28 does not apply because: (1) During August, 1977, Harkness was in the State Hospital for examination; (2) During February, 1978, Harkness was not tried because he obtained a severance of the three charges on his motion; and, (3) the congested docket of Crittenden County precluded a speedy trial.

Even if the first two periods of time were excluded, and the petitioner agrees that his tfoae in the State Hospital should be excluded, we wo have to apply Rule 28. Without even considering tíaní Ifeskness could have been tried during other terms of cerat, the September, 1978 Term of Division I had passed; the January, 1978 and November, 1978 Terms of Division II had passed. All of these are full terms of circuit court that had lapsed without any action on the charge. We do not consider any term of court during which the charges were made.

Therefore, we have left the third reason argued by the State which would prevent the application of Rule 28, and that is a congested docket.

The Circuit Court, Division I, entered an order, in response to the motion to dismiss, in which it was found that due to a congested docket, Harkness had not been earlier brought to trial. Rule 28.3(b) of the Arkansas Rules of Criminal Procedure provides for excluding periods of delay because of docket congestion. It reads:

Rule 28.3. The following periods shall be excluded in computing time for trial.
. . . (b) The period of delay resulting from congestion of the trial docket when the delay is attributable to exceptional circumstances. When such a delay results, the court shall state the exceptional circumstances in its order continuing the case.

In this case there was never a motion for a continuance by the State or the petitioner. There was no docket entry noting a reason for the delay. Rule 28.3(b) obviously contemplates that a trial judge will regularly call the docket, and if a case is to be continued beyond the time permitted by law, then the reasons will be stated. That was not done in this case. There was no finding the other divisions could not try this case; the law requires that precedence be given to criminal cases. Rule 27.1, Rules of Criminal Procedure; Gardner v. State, 252 Ark. 828, 481 S.W. 2d 342 (1972). There was no finding that giving precedence to criminal cases was a practice followed by the civil divisions of Crittenden County Circuit Court — a legal responsibility of these divisions, as well as the criminal division. There was no finding the congestion was greater than before, or that relief was sought by asking for additional judges.

We hold that the trial court’s findings, entered only after a motion to dismiss was filed, do not constitute sufficient grounds to exclude any term of court. Therefore, the writ is granted.

Writ granted.

We agree. Harris, C.J., and George Rose Smith and Bvrd, JJ.


source: Caselaw Access Project

author:
Carleton Harris, Chief Justice.
      Conley Byrd, Justice, concurring. John A. Fogleman, Justice, Darrell Hickman, Justice,

license: Public Domain

text:
    ARKANSAS PUBLIC SERVICE COMMISSION et al v. PULASKI COUNTY BOARD OF EQUALIZATION et al
    79-25
    582 S.W. 2d 942
    Opinion delivered June 25, 1979

      Steve Clark, Atty. Gen., by: Jackson Jones, Asst. Atty. Gen., for appellants.

      Friday, Eldredge & Clark, by: George Pike, Jr., for appellees.

      James A. Ross, Jr., of Ross & Ross, for amicus curiae Arkansas Assessors Association and J. D. West, Drew County Assessor.

      Cearley, Gitchell, Bogard, Mitchell <2? Bryant, for intervenor, Arkansas Education Association.
   Carleton Harris, Chief Justice.

The Pulaski County Board of Equalization instituted action with the Public Service Commission, hereafter called PSC, sitting as the State Board of Equalization, asking that the State Equalization Board and the Assessment Coordination Division undertake a full investigation of assessment practices statewide, make a report thereon, and order a reassessment and equalization of all taxable property of all the other 74 counties, to the end that all property will be taxed equally and uniformly at its true, actual, and market value as required by the Arkansas Constitution; that the Board take such steps as might be necessary to have Act 411 of 1973 and Act 188 of 1969 declared unconstitutional. After a public hearing, in which testimony was taken, the Commission found that it had jurisdiction over the matter; that in the opinion of the Attorney General, the Constitution does not require that property be assessed at current market value; that the Constitution permits the General Assembly to provide for different tax treatment for different classes of property and that the two acts, 411 of 1973 and 188 of 1969, are valid. The Commission then observed, “In- view of the Attorney General’s opinion and the presumption that statutes are constitutional, we are obligated to carry out the legislative mandate embodied in Acts 411 and 188 and leave any question as to the constitutionality of the acts for the court.”

A petition for review of the order of the Commission and the Assessment Coordination Division was filed with the Pulaski County Circuit Court, Second Division, and on trial, after preparing a well-considered opinion, the trial court held and directed:

Í. That Act 188 of 1969 is declared unconstitutional and the Arkansas Public Service Commission and its Assessment Coordination Division shall not comply with such Act in enforcing uniform property assessments throughout the State.
2. That Act 411 of 1973 is declared unconstitutional and the Arkansas Public Service Commission and its Assessment Coordination Division shall not comply with such Act in enforcing uniform property assessments throughout the State.
3. That all assessment practices based on other than current market value are unconstitutional and the Arkansas Public Service Commission and its Assessment Coordination Division shall not employ such practices in enforcing uniform property assessments throughout the State, except as hereinafter provided.
4. That the Arkansas Public Service Commission and its Assessment Coordination Division shall:
a. Develop an implementation plan designed to bring all counties into full compliance with this Order by the end of calendar year 1984;
b.Provide in such implementation plan for an orderly and equitable procedure whereby 15 counties per year shall be reassessed each year using such market value manuals and schedules developed by the Assessment Coordination Division of the Public Service Commission as are approved by the Court. This reassessment process shall begin with those counties with the greatest disparity between assessed value and market value and proceed at the rate of 15 counties per year through all seventy-five counties. The counties shall be ranked in order of disparity between assessed value and market value using the following criteria:
(1) The official ratio study published January 1, 1979, by the Assessment Coordination Division of the Public Service Commission.
(2) The valuation manual currently used by the county to value property.
(3) The date of the most recent county-wide reassessment in the county.
c. Prepare and submit to this Court by December 1,
1979, copies of the implementation plan and all working manuals to be used therein; and
d. Submit annual reports beginning December 31,
1980, setting out the progress to date toward full compliance.
5. The reassessment shall take place for the first fifteen counties from January 1, 1980, through December 31, 1980, based on the value of property as of January 1, 1980. The values thus determined shall be used by the assessors for any increase or decrease in value of each property between January 1, 1980, and January 1,1981. The remaining 60 counties shall be reassessed during the next four years on the same basis.
6. This Order is entered by consent of all parties except AEA, without affecting the merits of their respective positions taken before this Court or on any subsequent appeal, except that the parties, other than AEA, stipulate that the program for compliance set out herein shall be the program used to the extent this judgment is affirmed on appeal of the constitutional questions presented.

The validity of Act 411 of 1973 and Act 188 of 1969 is dependent upon the meaning of Article 16, §5 of the Constitution of Arkansas. Accordingly, we are required to interpret that section in determining this litigation. Pertinent portions, here at issue, of the section provide as follows:

All property subject to taxation shall be taxed according to its value, that value to be ascertained in such manner as the General Assembly shall direct, making the same equal and uniform throughout the State. No one species of property from which a tax may be collected shall be taxed higher than another species of property of equal value* * *
We are called upon to determine two questions:
I. Whether “value” as used in Article 16, § 5 of the Constitution of Arkansas, means “current use value” or “fair market, true or real value.”
II. Whether the Legislature may constitutionally classify property with the result being that one “species” of property may be taxed on a different basis than another “species” of property.

In a sense these two issues are inter-related, and this first point may require, to a certain extent, a discussion of the second point.

Because it is somewhat confusing, it is perhaps best to first explain the manuals that were being used. According to Mr. Marvin Russell, Director of the Assessment Coordination Division of the PSC, the assessors had been using a manual prepared in 1960. Another manual was prepared for 1972 and four or five counties, (not entirely clear), at that time, began using the 1972 manual because they had initiated re-appraisal programs; however, the other counties continued to use the 1960 manual, and this was the manual in general use in July, 1972. In 1973, Act 411 was passed by the General Assembly, this act providing that the assessment manual and standards promulgated by the Assessment Coordination Division for the valuation of real property in this state in effect as of July 1, 1972 (this was the 1960 manual in general use except for the five counties mentioned), should continue to be the assessment manual and standards to be followed by the department in making assessment ratio studies until such time as the department promulgated new or revised assessment manuals and standards and obtained approval thereof by the General Assembly. The 1960 manual which Act 411, in effect, directed to be used, contained appraisal guides based upon 1961 values for farm and timber land and 1956 values for residential construction. Accordingly, under Act 411, residential values were “frozen” as of 1956, and timber and farm land values were “frozen” as of 1961, and those counties which had started using the 1972 manual before July 1, 1972, as Russell stated, “were actually locked into it, involuntarily.”

While, according to Russell, the guidelines furnished by the manual in use at the direction of the legislature represent a minimum, actually, most of the assessors use the guidelines as a maximum. He further testified that, even though some assessments have been raised above the minimum provided by the 1960 manual, the Assessment Coordination Division makes its audit on the basis of the 1956 and 1961 valuations.

Russell stated that the 1960 manual defines value as:

The amount of money or money’s worth for which goods or services may be exchanged within a reasonable period of time, under conditions to which both parties to the exchange are able, willing and reasonably well informed. As defined by the courts, it is the highest price estimated in terms of money which a property will bring if exposed for sale in the open market, allowing a reasonable time to find a purchaser who buys with all knowledge of usage to which it is adapted and for which it is capable of being used. Frequently, it is referred to as the price at which a willing seller would sell and a willing buyer would buy, neither being under abnormal pressure.

So, except for Acts 411 and 188, this portion of the manual would pretty well provide for market value valuations.

Several studies of the ratio of assessed value to market value in particular years were mentioned in the testimony, the percentage varying all the way in one, from 2.66% to 13.93%; in another, from 2.66% to 16.87%; and in a third, from 3.98% to a high of 18.06%.

It is thus readily apparent that property is not being assessed at the same valuation throughout the state, and this actually applies to all kinds of property; in fact, the ratio of assessed value to market value appears to be different in almost every county.

So, it is clear that assessments are not “equal and uniform throughout the state” as required by the Constitution.

But the larger question relates to the meaning of the word “value,” Article 16, § 5, requiring that “all property subject to taxation shall be taxed according to its value.” An illustration which is perhaps overly simple serves to drive home the meaning of the word “value.” If an individual displays an article, be it an article of jewelry, an automobile, or even if a house is being sold, and is asked the question, “What is its value?”, the answer, of course, is the value of that property today — not what it was worth in 1956 or 1961— or any other year. The constitutional requirement, it would appear, undoubtedly means “present value,” because its value in some other year would almost certainly not be the same as the current value, and accordingly, if some other basis is used, would not be its true value at all. In addition, the failure to use present market value, but instead to use 1956 and 1961 values, likewise violates the provision that the same shall be “equal and uniform throughout the state,” for the reason that the value of properties in some counties since those years has greatly increased, while in others there has been an increase, but not so great, and in still others, the increase in value has only been minimal. In other words, the ratio of increase in property values has been far from the same in all 75 counties.

But it is argued that the Constitution provides “that value to be ascertained in such manner as the General Assembly shall direct.”

So it does — but it is apparent (from cases hereafter cited) that this provision means that the General Assembly may select the method for equalizing assessments, i.e., for reaching the true value of property, and not for the purpose of arriving at a lower value for some species of property.

It is interesting, and we think significant, that as far as the present subject is. concerned, all previous constitutions follow this same format. For instance, our first Constitution, adopted in 1836, uses the identical language heretofore quoted from Article 16, § 5, of the 1874 Constitution. The same is true of the 1861 Constitution and of the 1864 Constitution. The language varies in the 1868 Constitution, but provides:

Laws shall be passed taxing, by a uniform rule, all moneys, credits, investments in bonds, joint stock companies or otherwise; and also all real and personal property, according to its true lvalue in money,” (Our emphasis.)

This Constitution remained in effect for six years, at which time the 1874 Constitution was passed, which again uses the exact language of the Constitutions of 1836, 1861 and 1864. Accordingly, since the language is identical, it is worthwhile to observe what our earlier courts held relative to this provision.

In the early case of Pike v. State, 5 Ark. 204, decided in 1844, just eight years after the adoption of the 1836 Constitution, the court construed this same provision. The opinion was written by our first Chief Justice, Daniel Ringo. The legislature, for the purpose of raising revenue to support the state government, had enacted legislation which provided, inter alia, that a tax should be levied on all lands lying within this state (except those exempted by virtue of a compact between this state and the United States); alt town lots and the improvements thereon and providing that all lands should be valued at the true value thereof. The court held certain provisions of this act invalid, due to the fact that improvements located on town lots only were taxed and stated, “If, for instance, a tax be imposed on brick houses, no house of that description can be legally exempt therefrom, but all such, whether situated in a city, town or village, or in the country, must contribute equally, that is, in proportion to their value, to the revenue of the State.” The court added that the legislature possessed no power to restrict the operation of the law to particular lands or improvements as might be situated in some specified portion of the state, or in any sectional or legal division or sub-division thereof, the reason being that, under the Constitution, the tax imposed must be equal and uniform throughout the state. The court stated the rule to be:

From the view which we have taken, not only of the provision above quoted, but of every part of the constitution, we consider the rule there prescribed to be this, that property of every character and description upon which a State tax may be levied, must be taxed in proportion to its real and true value, and according to that basis be made to contribute to the revenue of the State; and that no portion of any distinct genus or species of property upon which such tax is imposed, can ever be exempt therefrom. (Our emphasis.)

In St. Louis IMS Ry. Co. v. Worthen, 52 Ark. 529, 13 S.W. 524 (1890), the only relevant question in the case was whether the legislature violated the constitutional mandate of equal taxation for all species of property when it created a state board for the task of determining the value of railroad property, the local assessors determining the value of all other property. This court held that such a procedure did not violate the constitutional requirement of equal taxation for all property of equal value.

Quoting from a California case, the court said:

We are unable to see how the fact that the value of one kind of property is to be ascertained by one officer or board, and the value of another kind of property by another officer or board — each clothed with the duty and responsibility of ascertaining the actual value — can be held to operate a deprivation of legal protection to the owners of either kind of property. The State board in the one case, the Assessors and county boards in the other, are but different instrumentalities through which the same result is reached; the fair and just valuation by reference to the same standard, and, therefore, the equal and uniform valuation of property for purposes of taxation. (Our emphasis.)

Of course, in determining market value, there are many factors to be taken into consideration. In American Bauxite Co. v. Board of Equalization, 119 Ark. 362, 177 S.W. 1151, this court reversed the circuit court for relying upon income as the sole indicator of the value of the property in disregard of its actual market value. We mentioned several elements that could well be considered in determining market value, stating:

In the determination of the market value of a given piece of property, necessarily a great many things are to be taken into account, and much of the voluminous evidence in this record is competent as bearing upon that question, although much of it tends only in a remote degree to the elucidation of that question. It is proper always in determining that question to take into account the character of the land; the uses to which it may be put; the character of the soil; the timber growing on the surface of the land as well as the ores hidden beneath; the accessibility of the land; its development; its proximity to other lands which have been so developed as to add to its own value; and the quantity of other lands of a similar character adjacent to it which would be calculated to make it more attractive to prospective purchasers, together with any other fact or circumstance which affects the property’s value. But all of these questions are to be considered for the purpose at last of ascertaining the market value of the tract in question, and that is the value which must be adopted for the purposes of assessment when it has been ascertained, in determining the market value of ordinary non-mineral land, for instance, it would not be improper to consider the depth of the soil, the crops which could be profitably grown, and the relative prices of these crops. A prudent investor would consider the accessibility of any tract of land and its convenience to market, and he would also take into account the facilities for marketing his produce. So, also, with mineral lands, it would be proper to take into account the quantity of the ore, the facilities for, and cost of mining it, as well as any other fact or circumstance which would likely make such lands a more attractive proposition to a prospective buyer. But all these things are to be considered for the purpose only of ascertaining the market value of the land. (Our emphasis.)

Actually, up until the time of passage of Acts 411 and 188, the General Assembly seems to have recognized that our Constitution required the assessment of property on the basis of current market value. The opening sentence of Ark. Stat. Ann. 84-428 (Repl. 1960), which is part of an act passed in March, 1883, (nine years after the adoption of the Constitution) and a part of Chapter 4 listed “Assessment of Taxes,” provides:

Each separate parcel of real property shall be valued at its true market value in money, excluding the value of crops growing thereon; but the price at which such real estate would sell at auction or at a forced sale shall not be taken as the criterion of such true value.
Ark. Stat. Ann. §84-426, passed in 1929, provides:
All property in this state shall be assessed by the duly authorized authorities according to its value on the first day of January. Provided, stocks of merchants and manufacturers shall be assessed at the value of the average stock in possession or under control during the year immediately preceding the first day of January of the year in which assessment is required.
Ark. Stat. Ann. §84-427, also passed in 1929, provides:
Every person in making his assessment shall assess all farm crops owned by him on the preceding July 31st, and according to its value of that date, instead of January 1st.

Certainly there is no reference to the value of the property at any time other than those dates, and it is clear that this act called for this procedure and this valuation to be made each year.

Of course, the General Assembly has the authority to enact any legislation not in conflict with Article 16, §5, and has full authority to set the percentage of market value that shall be used in making the assessment.

Ark. Stat. Ann. §84-476, passed in 1955, sets out:
The appraisal and assessment shall be according to value as required by Section 5 of Article XVI of the Constitution. The per centum of true and full market or actual value to be used in the appraisal and assessment shall be fixed and certified by the Commission as provided by sub-section (c) of Section 84-103, Arkansas Statutes, 1947; provided that until and unless a budget system is adopted with provisions for eliminating excessive and illegal tax rates and expenditures, the Commission shall not fix and certify a per centum of true and full market or actual value in excess of twenty per centum (20%). (Our emphasis.)

It is thus apparent that the General Assembly, at least through 1955, recognized that value as used in §5 of Article 16, meant true, market, or actual value.

In accordance with what has been said, it is evident that we find Act 411 of 1973 unconstitutional, and we agree with appellees that this is true for several reasons. One, however, is sufficient. Under the Act, property is not assessed as to current market value, but instead, artificial 1956 values for residential and certain construction are used, and likewise, farm and timber land are valued as of 1961,

Much of what has been said necessarily applies equally to the second question, which, we commented initially, is linked with the first, viz, whether the legislature may constitutionally classify property, the result being that one species of property may be taxed on a different basis than another species of property.

Act 188, even more obviously than the one just discussed, plainly violates the constitutional provision that property shall be taxed according to its value, “making the same equal and uniform throughout the state.” A few excerpts from the act clearly establish this fact. Section 1 provides:

Hereafter, all lands which are actively devoted to farm, agricultural or timber use shall be assessed for ad valorem tax purposes on the basis of such current use, and shall not be assessed as if subdivided or on any other basis.* * * (Our emphasis.)

Section 2, sub-sections (A) and (B), provide:

(A) Any owner desiring to have his farm, agricultural or timber land assessed according to its current use under the provisions of this Act shall make application to the county assessor, of the county wherein the land is located on such forms as the county assessor shall direct. Such form must be filed between January 1 and July 1 during the calendar year immediately preceding that in which such classification is to begin. Such forms shall include only such information as shall be reasonably required to determine the entitlement of the applicant and each application shall include an affidavit that the statements contained therein are true.
(B) Upon the submission of the initial application if the county board of equalization of the county wherein the real property is located finds that the land qualifies under the provisions of this Act, it shall file notice of the same with the county assessor, and the county assessor shall as to any such land make a notation on the assessment list and the tax roll each year of the assessed value of such land for the use for which it is classified in addition to the assessed value of such land were it not so classified, and shall file notice thereof with the county tax collector. (Our emphasis.)

Sub-section (D) provides that once the land has been classified as farm property, it shall remain in that classification until there is a request by the owner that it be withdrawn from the classification, or until the assessor shall find that the land is used for other purposes. The legislation provides that the owner each year shall file an affidavit that the land is being used for farm, agricultural, or timber purposes.

The Act then sets out:

Any lands withdrawn from the above classification either by the owner or through failure of the owner to file the required affidavit of use shall not be entitled to be classified again under this Act as farm, agricultural or timber lands until a four (4) year period has elapsed. If the land is either withdrawn from the above classification or the owner thereof shall fail to file an affidavit of use each year, then the land shall be assessed and taxes collected thereon as non-farm, non-agricultural or non-timber lands. (Our emphasis.)

In other words, farm, agricultural and timber lands, under Act 188, are taxed according to the use made of the property, and not the market value, which we have pointed out as the requirement under Article 16, §5 of the Constitution.

In Little Rock & Ft. Smith Ry. Co. v. Worthen, 46 Ark. 312, this court said:

The theory of our constitution is that the common burden shall be borne by common contributions. All property is to be taxed according to its value. ‘All’ does not mean all the legislature may designate, or all except such as the legislature may exempt. If this were so the whole burden of taxation might be thrown upon land, or upon any one species of property. It means all private property, of every possible description, or all property other than that belonging to the state, or the general government. The legislature cannot discriminate between different classes of property in the imposition of taxes. The only discretion with which it is invested, is in the ascertainment of values, so as to make the same equal and uniform throughout the slate.{Our emphasis.)

In Hays v. MoPac Ry. Co., 159 Ark. 101, 250 S.W. 879, we said:

It is true that property such as railroads may be classified for taxation and assessed by different methods and by different officers from those assessing other property. But the object is nevertheless the same, and that is to arrive at the value of the property and tax it according to its value, making the same equal and uniform throughout the State. While exact equality in taxation cannot be achieved, intentional inequality of assessments violates the mandate of the Constitution in question and invalidates the tax.

Likewise, in Pulaski County Board of Equalization v. American Republic Life Ins. Cos., 233 Ark. 124, 342 S.W. 660, this court reiterated the constitutional requirement, stating:

The language of the constitution is too plain to be misunderstood: ‘No one species of property . . . shall be taxed higher than another species of property of equal value.’ (Our emphasis.)

Professor Wade J. Newhouse, }r., in his text, Constitutional Uniformity and Equality in State Taxation (1959), reviews the ad valorem tax laws of all the states. As to Arkansas, he states:

Property may be classified for the purpose of using different methods in determining the value of the several classes. It is important for comparative purposes to emphasize this because any indication found in the annotations or digests of cases to. the effect that ‘property may be classified for purposes of taxation’ stems from the language found in the cases ruling on this particular point. Taken out of context, the language quoted in the annotations is misleading. But there is no confusion in the actual decisions of the Arkansas court. Any statements concerning the classification of property were made solely in relation to classification for the method of determining the value of property. (Our emphasis.)

As pointed out throughout this opinion, almost from the beginning of our statehood, the word “value” in Article 16, §5, has been interpreted by this court as meaning current market value, and likewise, legislation enacted during this long period of years has consistently recognized that interpretation of the Constitution up until the time that Acts 411 and 188 were passed. Also, it is clear the Constitution provides that no one species of property from which a tax may be collected shall be taxed higher than another species of property of equal value, a provision which Act 188 clearly violates. We agree with the trial court that the provisions of both Act 411 of 1973 and Act 188 of 1969 are not in conformity with the constitutional provision herein discussed, and thus are unconstitutional, void, and of no effect.

In the final part of its order, the trial court, with the agreement of all parties except the Arkansas Education Association (and this last organization has not argued the matter in its brief), framed a remedy (to avoid undue disruptions) which allows until the end of 1979 for the PSC to complete preparation of an implementation plan and working manuals to be used therein, and further provides that a statewide reassessment program shall begin January 1, 1981, using 15 counties each year, as designated in the order, from that date until the program is completed.

As stated by the appellees, this remedy furnishes sufficient time for planning by the counties and the state-to achieve a proper level of taxation by adjustment of millage, adjustment of the 20% ratio required, or by constitutional amendment. Since it is agreed upon by three of the four groups of parties and not affirmatively opposed by the fourth, we approve the agreement.

Affirmed.

Byrd, J., concurs; Fogleman and Hickman, JJ., concur in part and dissent in part.

Conley Byrd, Justice, concurring.

I concur in the result that Act 411 of 1973 and Act 188 or 1969 are unconstitutional. However, I do not agree that the term “value” in Art. 16, § 5 of the Constitution of Arkansas must be construed to mean “market value.” The State could elect to tax all property according to its use and still comply with Art. 16, § 5, supra. However, the State cannot tax some properties at “market value” and other property at “use value” and still comply with Art. 16, § 5 because such a system inevitably results in some species of property being taxed higher than other species of property of the same value.

For the reasons herein stated, I concur only in the result.

John A. Fogleman, Justice,

concurring in part, dissenting in part. It appears that the Pulaski County Equalization Board, or at least the Pulaski County taxpayers, along with taxpayers in some other counties, have a legitimate complaint about the disparity in assessed valuations over the state. If assessed value was the basis only for county taxes, perhaps the matter could be viewed in a different light, but that is not entirely the case. But there can be no question about the constitutional mandate to the General Assembly to prescribe a manner of determining values for taxation that would make them uniform throughout the state and such that no one species of property shall be taxed higher than another species of equal value. Art. 16, §5, Constitution of Arkansas.

Along with my brothers Byrd and Hickman, however, I must dissent from a substantial part of the majority’s holding, and I subscribe to the concurring opinions without reservation, except that I feel that Act 411 of 1973 is constitutional.

I submit that the Attorney General’s opinion that the Arkansas Constitution does not require that property be assessed at current market value was correct. In order to say that it does, something must be read into Art. 16, § 5 that is not there. This court has no power to so amend the constitution. I must agree, however, that the acts questioned have been unconstitutionally applied, to say the least.

Perhaps the majority, the trial court and appellees reached their conclusion that value necessarily means market value by commencing with the erroneous premise that the language of our present constitution and that of the 1868 constitution are of the same effect. They are not. Under the 1868 constitution, real and personal property were to be assessed according to its “true value in money.” Nowhere in Art. 16, § 5 is anything said about true value, much less true value in money. Surely the drafters of the present constitution intended that “value” mean something other than “true value in money.” If not, why did they not use the same language? Never has this court said that value in Art. 16, § 5 means market value. Even when the Constitution of 1868 was in effect, we did not say that property must be assessed at market value. If there is anything Pike v. State, 5 Ark. 204, does not hold, that is that property must be assessed at market value. In that case, Albert Pike did not want to have to pay taxes on his house in Little Rock, because the law provided that farm lands be assessed without reference to improvements. An act of the legislature required that improvements on town lots be assessed along with the land. This court certainly did not say that property was to be assessed according to market value, because it held that Pike only had to pay taxes on the value of the lots, exclusive of the improvements. That is not, was not, and cannot be, market value. How can one ignore a building on a tract of real property, particularly a town lot, in fixing its market value?

The foundation of the holding of the trial court and the majority of this court is the premise that “value” in Art. 16, § 5 means “market value.” The fact that the General Assembly has, in some statutes, chosen market value as the manner in which value is determined does not mean that that branch of the government felt that it had a constitutional mandate to do so. It simply chose that manner as the best approach to a determination of value for certain types of property. It has not always done so. Long ago, it resorted to “use value” for some types of property. The General Assembly adopted an act in 1893, providing for the assessment of sleeping or dining car companies, express companies and telegraph companies. A “use” valuation for the purpose of taxation of these com-pañíes was held valid under Art. 16, § 5. In Wells, Fargo & Co’s. Express v. Crawford County, 63 Ark. 576, 40 S.W. 710, we treated the matter of taxation of express companies, saying:

* * * One object of this statute was to require that the property of such corporations should be assessed as a “unit profit-producing plant,” and that their property in this state used in carrying on the corporate business should be assessed at its value when considered as a part of such unit or whole plant. The mere fact, therefore, that the assessment of the property of the company in this state was greater than the aggregate value of the safes, wagons, and other articles of property owned by the company in this state, when considered only as safes, wagons, etc., and apart from the use to which they are pul, would not in itself justify us in concluding that the assessment was illegal and excessive. Much less does the allegation that the aggregate value of the articles of personal property owned by the company in Crawford county is less than the sum apportioned by the board to said county as the value of the property of appellant taxable in such county justify such a conclusion; for the value of the property of the company in this state, considered as part of a whole plant, and in connection with the uses to which it is put, may be more than the aggregate value of the separate articles of personal property owned by the company here, when not considered in connection with the use to which the property is put. “The value of property results from the use to which it is put, and varies with profitableness of that use, present and prospective, actual and anticipated.” And it is the duty of the board to assess the property of the company at its true value, although that value may be in part due to the fact that such property is a portion of a large “profit-producing plant.” Railway Co. v. Backus, 154 U.S. 421, 14 Sup. Ct. 1114. * * *
* * * The method provided for the assessment of this property was legal; for the legislature has the power to classify property for the purposes of taxation, and to provide for the valuation of different classes by different methods. Const. 1874, Art. 16, § 5; Railway Co. v. Worthen, 52 Ark. 529, 13 S.W. 254. The same reason exists for the separate classification of the property of express companies used in carrying on their business as exists in case of railway property. * * * [Emphasis mine.]

Appellees referred us to a definition of the word “value” in Black’s Law Dictionary. The very first definition of the word given there is use value, not market value. It is:

The utility of an object in satisfying, directly or indirectly, the needs or desires of human beings, called by economists “value in use;” or its worth consisting in the power of purchasing other objects, called “value in exchange.” [Citation omitted.] Also the estimated or appraised worth of any object or property, calculated in money.

Other definitions given in that dictionary include:

In economic consideration, the word “value,” when used in reference to property, has a variety of significations, according to the connection in which the word is employed. It may mean the cost of a production or reproduction of the property in question, when it is sometimes called “sound value”; or it may mean the purchasing power of the property, or the amount of money which the property will command in exchange, if sold, this being called its “market value,” which in the case of any particular property may be more or less than either the cost of its production or its value measured by its utility to the present or some other owner; or the word may mean the subjective value of property, having in view its profitableness for some particular purpose, sometimes termed its “value for use.” * * *

See Black’s Law Dictionary (DeLuxe 4th Ed.), p. 1721. Furthermore, the case upon which the dictionary definition adopted by appellees relies, does not support the definition they would have us use. That case was Thaw v. Fairfield, 132 Conn. 173, 43 A. 2d 65, 160 ALR 679 (1945). It involved assessments for the purpose of taxation. The Connecticut Supreme Court only said in that case that the ordinary basis for arriving at true and actual valuation is what the property would bring in a fair market and not at a forced sale. That court recognized, in specific language, that the value of property is determined by many factors and, in the final analysis, is a matter of opinion, but, in its opinion, the best test is that of market sales.

The only mandate of Art. 16, § 5 is that all property be taxed according to value, i.e., on a valuation basis, and not some other basis. The value is to be ascertained in such manner and on such basis as directed by the General Assembly. It is not necessary that the value be full value, so long as valuations of property are equalized. State v. Meek, 127 Ark. 349, 192 S.W. 202. This section only requires that the burden of taxation be laid equally and uniformly on all property in proportion to its value, so that every property owner will contribute to the public revenue in proportion to the value of the property owned by him. Pulaski County Board of Equalization Cases, 49 Ark. 518, 6 S.W. 1. It has even been said that the constitutional requirement has been met when assessments are imposed equally upon all standing in the same relation. Shibley v. Ft. Smith & Van Buren Dist., 96 Ark. 410, 132 S.W. 444.

The infringement on the rights of taxpayers purportedly represented by appellees is that use valuation is restricted to particular types or species of property, i.e., farm, agricultural and timber lands. Unfortunately, owners of these lands were not before the trial court. It appears clear, however, that regardless of the manner in which values are fixed by assessing authorities, the classifications of property for that purpose must not run counter to the fundamental requirement of equality in taxation prescribed by Art. 16, § 5, i.e., that all property of the same value be taxed at the same ratps. Pulaski County Board of Equalization v. American Republic Life Ins. Co., 233 Ark. 124, 342 S.W. 2d 660; Pulaski County Board of Equalization Cases, supra.

Achievement of equality and uniformity in taxation is an ideal which is unattainable, and all that the constitution requires is substantial or approximate equality and uniformity. Peay v. City of Little Rock, 32 Ark. 31; Board of Directors of Crawford County Levee District v. Crawford County Bank, 108 Ark. 419, 158 S.W. 149; Shibley v. Ft. Smith & Van Buren District, supra; Pulaski County Board of Equalization v. American Republic Life Ins. Co., supra. But a system which obviously produces inequality violates the constitution. Pulaski County Board of Equalization v. American Republic Life Ins. Co., supra. The requirements of Art. 16, § 5 extend beyond the rate of taxation to the mode of assessment. Hays v. Missouri Pac. R. Co., 159 Ark. 101, 250 S.W. 879. The legislature cannot discriminate between different classes of property in the imposition of the tax burden. The only discretion with which it is invested is in the ascertainment of value so as to make the same equal and uniform throughout the state. L.R. & F.S. Ry. Co. v. Worthen, 46 Ark. 312, appeal dismissed 120 U.S. 97, 7 S. Ct. 469, 30 L. Ed. 588 (1886).

Act 188 of 1969 is unconstitutional, not because it permits agricultural and timber lands to be assessed for taxation only on the basis of their current use, but because it has resulted in an impermissibly unequal and non-uniform placing of the tax burden on those owners of property of a different species who must pay taxes on an assessed valuation based on market value. If as a result of the act, assessments are such that the burden of taxation falls more heavily upon one species of property than it does on another of equal value, it is unconstitutional. I must agree that there has been an adequate showing that this has resulted and that showing has been uncontroverted.

Act 411 of 1973 presents an entirely different problem. It requires the county assessor to use a manual and standards which appear to be out of date. It does not limit him to its use in making an assessment. It requires county boards of equalization to recognize and follow those manuals and standards, but the boards are not limited to them. A county judge is required to recognize and follow such manuals and standards only “to the extent he deems them applicable,” just as the statute required before amendment by Act 411. The act specifically provides that the manuals and standards are for the assistance of the assessors and boards of equalization in making assessments and that both the assessors and the boards “may use other acceptable appraisal or valuation methods which, in their judgment, provide for a more equitable assessment and appraisal of real and personal property.” An equalization board may change an assessment made by an assessor only when necessary to provide uniformity in assessment of similar classes of property. The county judge may change one only when it is deemed necessary to provide for equitable assessment of the property to make it uniform with the assessment of similar classes of property in the county. As long as the various classes of property are valued on a uniform basis, there has been no infringement on the constitutional restrictions. The mere fact that the General Assembly required that the manuals and standards promulgated by the Assessment Coordination Department (Division) not be changed until new or revised manuals and standards had been submitted to, and approved by, the General Assembly does not make the act unconstitutional on its face. The General Assembly, by Act 411 of 1973, virtually required the Assessment Coordination Department to submit a manual and standards based upon pertinent and proper real estate valuation standards, i.e., cost factors, market conditions, actual or potential income-producing value and other acceptable valuation methods and procedures. The fact that this has not been done does not make the act facially unconstitutional.

I earnestly submit that Act 411 is not unconstitutional. The application of the act and the failure of the Assessment Coordination Department, or the Public Service Commission, to function may well have caused the unconstitutional disparity in valuations of property over the state. That department or its predecessors have been charged with the duty of equalizing assessments from county to county for quite a long time. See Bank of Jonesboro v. Hampton, 92 Ark. 492, 123 S.W. 753; Arkansas Tax Commission v. Ashby, 217 Ark. 759, 233 S.W. 2d 361; State v. Meek, 127 Ark. 349, 192 S.W. 202; Ark. Stal. Ann. § 84-714, et seq (Repl. 1960).

It is obvious that there is no equalization of assessments from county to county. The state equalization authorities have not functioned. It may be that the failure is because the legislature has not provided the funds or manpower. We cannot pass judgment on that question.

But it is obvious that there can be no equalization when the authorities charged with that duty abdicate in favor of each individual assessor. The evidence in this case shows clearly that in checking compliance of the county officials in each county, the representatives of the Assessment Coordination Department accept whatever standard the assessor in that county chose to follow, whether it was based on values in a 1960 manual, a 1972 version, or a 1976 revision, current values or whatever values struck that assessor’s fancy. In most counties, if the assessor comes within 60% of market value on town lots, the Assessment Coordination Department approves. But in Pulaski and Jefferson Counties, the criterion is 100%. In Benton, Washington and Faulkner Counties, it is 75%. Uniform assessment is impossible when that practice is followed. The updating of the department manuals and standards could well result in a constitutional application of Act 411. I cannot agree that it is unconstitutional.

Darrell Hickman, Justice,

concurring in part, dissenting in part. I agree with the majority in every respect except one: the effective date of the judgment.

The trial judge originally entered his order, as a judge should, without regard to the mechanics of its implementation. Then, upon the urging of some of the parties (and I might add that the most important parties, the taxpayers, individual, corporate or farmer, and recipients of those taxes, were not privy to this arrangement), the court delayed implementation of the judgment over a period of 5 years. That is, beginning in 1981, 15 counties, the lowest in assessment-ratio, will comply first; then 15 counties the next year, and so on until all counties comply.

This means that for 5 years, 15 counties, and the taxpayers in those counties, will enjoy immunity from complying with the law. Conversely, 15 counties, and the taxpayers in those counties, will have to comply 5 years before 15 other counties.

This was done, at the urging of the Public Service Commission, to aid it in implementing a law that has existed for over 100 years. Discrimination and unequal treatment in any form cannot be condoned or facilitated by the courts. (The trial judge said he was entering this modified order against his better judgment.) The legislative and executive branches of government are uniquely equipped and authorized to enact laws and carry them out - the judicial branch of government is not. We, as a court, should not ever consciously cross that line of the limits of our authority. The majority has done so, as did the trial judge, with good intentions; good intentions are often the reason for abuses of power.

It is the duty of the courts to make decisions; the other branches of government implement them. The trial judge was originally correct and should not have succumbed to the temptation to bail out the Public Service Commission from a problem it must solve.

I would modify the trial court's judgment to be effective as originally ordered.

      All other 74 assessors were made party defendants in the action filed with the PSC and the Arkansas Education Association was subsequently given permission to intervene.

      Additionally, the section provides that certain property shall be exempt from taxation, viz., “public property used exclusively for public properties; churches used as such; cemeteries used exclusively as such; school buildings and apparatus; libraries and grounds used exclusively for school properties; and buildings and grounds and materials used exclusively for public charity.”

      Act 411 does provide that the assessors may use other acceptable appraisal or valuation methods which in their judgment provide for a more equitable assessment and appraisal of real and personal property (provided that these methods do not place the assessment below the years heretofore mentioned).

      This section provides that the Arkansas Public Service Commission shall have full power and authority in the administration of the tax laws of the state now in force or such as may hereinafter be enacted and sub-section (c) provides that the Commission shall “file with the county judge, county clerk and county assessor of each county not later than ten [10] days before the time for the beginning of the assessment of property by the tax assessors a certificate showing the per centum of true and full market or actual value that it has used, or will use, in valuing for taxation for that year the property the Commission is required to assess; and it shall be the duty of the assessors and boards of review or equalization and county judges to adopt the same basis of valuation of property in their county for the purpose of taxation as that so certified by the Commission.”

      Of course, Constitutional Amendment No. 57 was adopted in November, 1976, §1 providing: “The General Assembly may classify intangible personal peoperty for assessment at lower percentages of value than other property and may exempt one or more classes of intangible personal property from taxation, or may provide for the taxation of intangible personal property on a basis other than ad valorem.” § 2 provides: “The provisions of this amendment shall be in lieu of those provisions of Article 16, §5 of the Constitution of the State of Arkansas relating to the assessment and taxation of intangible personal property.” (Our emphasis.)

       This was prepared while Professor Newhouse was research assistant to the Legislative Research Center, University of Michigan Law School, and was completed during succeeding summers. Professor Newhouse states that he attempted to reflect all cases cited through the summer of 1956. At the time of publication, he was connected with the School of Law of the University of Buffalo at Buffalo, New York.


author: George Rose Smith, Justice.

text:
    Mack SKINNER et al, Trustees, v. J. Elmer BERRY, Prairie County Judge
    79-42
    583 S.W. 2d 27
    Opinion delivered June 25, 1979
    (Division I)

      Macon, Moorehead & Green, by: J. W. Green, Jr., for appellants.

      Randall L. Gammill and James W. Thweatt, for appellee.
   George Rose Smith, Justice.

The controlling question is whether the four appellants, as “Trustees for the Churches of the City of Stuttgart,” are proper parties to apply to the county judge of Prairie County for a permit t to establish a cemetery upon a 4.64-acre tract of land in Prairie County.

Section 1 of Act 204 of 1929, compiled as Ark. Stat. Ann. § 82-401 (Repl. 1976), provided that any party or parties proposing to establish a cemetery could apply to the county judge for a permit to do so. That statute, however, has largely been superseded by later acts — most recently by Act 352 of 1977, which creates the Arkansas Cemetery Board and requires that permits for the establishment of new cemeteries be obtained from that board. § 82-426.4 and 82-426.7 (Supp. 1977). The 1977 act, however, does not apply to cemeteries owned and operated by “a church or similar religious organization.” § 82-426.3. Hence the appellants might be entitled to apply to the county judge, instead of to the Cemetery Board, for a permit if the proposed cemetery is to be owned and operated by a church or similar religious organization. The circuit court, in this action by the appellants for a writ of mandamus to compel the county judge of Prairie County to issue a permit for the proposed cemetery, held that the appellants are not entitled to proceed under the exception in the 1977 act, because the cemetery would not be owned and operated by a church or similar religious organization. In view of the particular facts in the case we are compelled to agree with that conclusion.

The effort to establish the proposed cemetery apparently began with a resolution adopted by the city council of Stuttgart on December 30, 1976. That resolution authorized the mayor to execute a deed conveying 4.64 acres owned by the city in Prairie County “to a Grantee selected by the churches of this community.” The resolution provided that the grantee would hold the land as trustee for those churches and would make application to the State of Arkansas for a cemetery permit.

J. W. Green, Jr., a Stuttgart attorney attempting to aid the project, published a newspaper notice that a meeting would be held in the courthouse on March 6, 1977, for the purpose of selecting trustees to hold title to the land in accordance with the city council’s resolution. The notice was addressed to 30 named churches, and a copy of the notice was also mailed to those churches. Representatives of six churches attended the meeting and elected the four appellants as trustees. On March 16, 1978, the city conveyed the 4.64-acre tract to the appellants “as Trustees for the Churches of the City of Stuttgart, Arkansas.” The trustees then applied to the county judge of Prairie County for a permit and later brought this action against him for a writ of mandamus.

The insurmountable difficulty in the appellants’ position, as we view the case, is that the proposed cemetery will not be owned and operated by any particular church or churches. The 1977 act contemplates that new cemeteries will ordinarily be established by cemetery companies, as defined in Section 82-426.2. An application for a permit to establish a new cemetery must contain detailed information, including a provision for a permanent maintenance fund for perpetual care of the cemetery. § 82-426.7. There are also provisions for regulation of the investment of a cemetery company’s funds and for the keeping of necessary records. §§ 82-426.14 and -426.17. ¡n short, the act attempts to protect the public by provisions designed to promote the stability and solvency of cemetery companies.

We must consider the act as a whole in arriving at the purpose and intent of the section which exempts from the provisions of the act a cemetery that is owned and operated by a church or similar religious organization. The legislature evidently believed that an existing church, owning and operating a cemetery, would provide a measure of stability and solvency comparable to that which the legislature sought to insure with respect to cemetery companies in general. Thus a church may own and operate a new cemetery, by permission of the county judge, but there is no similar provision for one or more individuals to do so.

Yet, essentially, the appellants are four individuals who seek to own and operate the proposed cemetery on the tract provided by the city. They were elected as trustees by representatives of several Stuttgart churches, but no identifiable church has seen fit to assume responsibility for the care and maintenance of the new cemetery. Thus the proposal, however well motivated, does not meet the statutory requirement that the proposed cemetery be owned and operated by a church or similar religious organization. The circuit court was therefore correct in holding that the appellants are not proper parties to compel the county judge to issue a permit for the establishment of the cemetery.

Affirmed.

We agree. Harris, C.J., and Byrd and Hickman, JJ-


text:
    John Hugh HENRY and Roselyn Henry MULLEN v. Alta GOODWIN and C. B. ATTAWAY
    79-44
    583 S.W. 2d 29
    Opinion delivered June 25, 1979
    (Division I)

      .Volan, Alderson & Vickery, for appellant.
    7- S. Brooks and Spencer & Spencer, for appellees.
   George Rose Smith, Justice.

The appellants, as the surviving children and sole heirs of Lois Thompson Henry, brought this suit to quiet their title to an 87.29-acre tract of land in Union county. The principal defendant is the appellee Alta Goodwin, who conveyed the land to the plaintiffs’ mother, Mrs. Henry, in 1973 by a warranty deed and later by what amounted to a correction deed. The chancellor, finding that the effect of the deeds was to create an express trust in favor of Mrs. Goodwin, dismissed the appellants’ complaint. For reversal the appellants contend, first, that no trust was created, and second, that Mrs. Goodwin is precluded by estoppel and by the clean hands doctrine from asserting her claim to the land.

In 1973 Mrs. Goodwin, then about 83, learned that she would be eligible for supplemental Social Security income if she got rid of her land and did not have more than SI,500 in cash. She consulted Mrs. C.B. Attaway, who had been a real estate broker for over 30 years. Mrs. Attaway advised Mrs. Goodwin to convey the land to some third person and to have that person deed the land back to Mrs. Goodwin, so that the second deed could be recorded if the grantee predeceased Mrs. Goodwin.

Mrs. Goodwin’s niece, Mrs. Henry, agreed to hold the title for Mrs. Goodwin. Mrs. Goodwin executed a warranty deed to Mrs. Henry on November 8, 1973, which was promptly recorded. Mrs. Henry reconveyed the land to Mrs. Goodwin on April 3, 1974, but that deed was not then recorded. Both deeds contained defective descriptions. On July 19, 1974, Mrs. Goodwin executed a second deed to Mrs. Henry, with a correct description. Mrs. Henry did not execute a second deed back to Mrs. Goodwin, but she did give Mrs. Goodwin a letter that said: “Since a more complete description of your land was required I took another Deed from you last Thursday. I will deed it back to you when you have made other arrangements to take care of your medical expenses.” Mrs. Goodwin also deposited certain cash in a joint savings account with Mrs. Henry.

It happened that Mrs. Henry, the younger of the two women, died on December 31, 1975. Within the next seven days Mrs. Goodwin recorded the deed to her from Mrs. Henry and also conveyed the land to Mrs. Attaway, now a co-defendant, who agreed to hold the title for Mrs. Goodwin. One of the appellants, John Hugh Henry, acted as an executor of his mother’s estate. He did not then question Mrs. Goodwin’s assertion that she owned the land and the savings account. Neither item was listed in the inventory of Mrs. Henry’s estate. The money in the account was turned over to Mrs. Goodwin. Later on the appellants apparently changed their minds and brought this suit to recover the land from Mrs. Goodwin.

The chancellor reached the right result, although we do not agree that a valid express trust was created. Equity, however, will impose a constructive trust when a grantee standing in a confidential relation to the grantor orally promises to hold land for the grantor and later refuses to perform his promise. Walker v. Biddle, 225 Ark. 654, 284 S.W. 2d 840 (1955). The appellants, as heirs of their mother, paid nothing for the land and so stand in no better position than she would have occupied. Baker v. Applen, 181 Ark. 424, 26 S.W. 2d 109 (1930).

“A confidential relation exists between two persons when one has gained the confidence of the other and purports to act or advise the other’s interest in mind.” Restatement, Second, Trusts, § 2, Comment b (1957). Here the confidential relation and the other material facts relating to the constructive trust are shown by clear and convincing evidence; indeed, the testimony is virtually undisputed. John Hugh Henry, one of the appellants, testified that for 18 years before his mother’s death she and her aunt, Mrs. Goodwin, had been neighbors and visited on a daily basis. “Mrs. Goodwin was there every night to watch television. Mrs. Goodwin would come in during the day. She from time to time would take a meal at our home, and she and mother had a very, very good, close and warm relationship.” Mrs. Henry’s deed to Mrs. Goodwin and her letter both show that she was holding the title for her aunt. All the necessary elements of a constructive trust are present.

The appellants also contend that since Mrs. Goodwin apparently misrepresented her position to the Social Security agency, she is precluded by estoppel or the clean hands doctrine from claiming the land. In a similar situation, where the owner of property transfers it upon an intended trust which fails for illegality, “a resulting trust does not arise if the policy against permitting unjust enrichment of the transferee is outweighed by the policy against giving relief to a person who has entered into an illegal transaction.” Restatement, supra, § 422. It is thus a matter of balancing conflicting principles of public policy. Among the factors to be considered are (1) whether the grantor’s conduct involves moral turpitude, (2) the extent of the policy making the transaction illegal, (3) whether the enforcement of a trust would tend to prevent the accomplishment of the illegal purpose, (4) whether the transferee was more at fault than the transferor, and (5) whether the transferor was ignorant of the law or of the facts making the trust illegal. Id., Comment b.

Here the difficulty is that the appellants, in attacking the validity of the transaction between Mrs. Goodwin and Mrs. Henry, did not develop enough facts to show that the trust in favor of Mrs. Goodwin ought not to arise. The record does not disclose just what the Social Security regulations are. Mrs. Goodwin evidently relied upon the advice given to her by Mrs. Attaway. Mrs. Henry was perfectly willing to participate in the transaction. Mrs. Goodwin testified that she did not tell the Social Security office that she didn’t own the land any more. “I just told them that I had made arrangements to not list it.” Mrs. Henry apparently took the deed to the Social Security office for its inspection, pursuant to a letter from that office saying that the agency was required “to verify the transfer of this property.” Of course, what we say in this opinion is not binding upon the Social Security Administration, which is not a party to the case and may be in a position to recover whatever payments were made to Mrs. Goodwin. We cannot say, however, in balancing the equities, that Mrs. Goodwin’s conduct was so reprehensible that she should lose the property which she has apparently occupied as her home since 1913.

Affirmed.

We agree. Harris, C.J., and Byrd and Hickman, JJ.


author: George Rose Smith, Justice. John I. Purtle, Justice,

text:
    Virgil MANN v. Henry M. BRITT, Judge
    CR 79-46
    583 S.W. 2d 21
    Opinion delivered June 25, 1979
    (In Banc)

      George M. Callahan, for petitioner.

      Steve Clark, Atty. Gen., by: Alice Ann Burns, Asst. Atty. Gen., for respondent.
   George Rose Smith, Justice.

In June, 1978, the Garland county grand jury returned indictments charging the petitioner, Virgil Mann, and three co-defendants with various counts of public servant bribery, theft, conspiracy to commit theft, and obtaining money under false pretenses. Mann’s co-defendants were M. B. “Rip” Evans, Jeanette Evans, and Rip Evans Construction Company, Inc. All the defendants pleaded not guilty. At first Mann and his three co-defendants were all represented by George M. Callhan, a lawyer who had previously represented Mann and Rip Evans in other matters. In November, however, the three co-defendants, at the suggestion of the circuit judge, obtained independent counsel. In January, 1979, pursuant to a plea bargain, Rip Evans and his corporation changed their pleas to guilty, and the charges against Mrs. Evans were dismissed. As part of the plea bargain Rip Evans agreed to testify against Mann.

In February the circuit court conducted a hearing upon a motion by Evans asking the court to admonish Mr. Callahan not to divulge, through cross-examination or otherwise, any information which Mr. Callhan had received from the Evanses during their attorney-client relationship, and upon a motion by the State to disqualify Mr. Callahan from continuing to act as Mann’s attorney in the cases. The circuit judge ruled that Mr. Callahan should be disqualified from further representation of Mann in the pending cases and that Mann should obtain other counsel for the trial, which was tentatively set for February 27. Mr. Callahan, as Mann’s attorney, then applied to this court for a writ of prohibition to prevent the circuit court from proceeding with the cases pursuant to its ruling that Mr. Callahan was disqualified to act as defense counsel. We issued a temporary writ of prohibition to stay the proceedings until the matter could be submitted to this court on briefs, which has been done.

The indictments have not been made exhibits to the petition for prohibition, which with its exhibits is the record in this court. Supreme Court Rule 16 (a). We can, however, infer the nature of at least part of the charges from the testimony given by Rip Evans at the hearing at which the court approved his plea bargain with the prosecuting attorney. Evans testified that Mann, a street commissioner (presumably of the city of Hot Springs), had stated that he was in need of money. As we understand Evans’s testimony, Mann prepared fraudulent purchase orders, running to thousands of dollars, by which the city was ostensibly to purchase oil from Evans or his company. The city issued its checks to Evans or the company for the various purchases. Evans, without delivering the oil to the city, turned the money over to Mann, after retaining enough to pay Evans’s federal income taxes on the transactions. Thus, according to Evans, Mann was the conspirator who actually profited from the transactions.

We hold that the circuit judge did not abuse his discretion in disqualifying Mr. Callahan from further participation in the cases. In reaching this conclusion we emphasize the apparent impropriety of Mr. Callahan’s original attempt to represent all four defendants. We note in passing that Mr. Callahan does not seem yet to have conceded even the possibility of impropriety on his part. He says, for example, in his type-written brief seeking a temporary writ of prohibition that no conflicts between the defendants arose during the time that he was representing them, that the conflicts arose only after three of them had obtained separate counsel. Again, Mr. Callahan says in his printed brief, with respect to the hearing at which the trial court imposed the disqualification: “There was no showing in the hearing that the interest of Co-Defendants, Mann and Evans, was not similar or that any defenses asserted by one would be inconsistent with that interposed by the other.”

On the record before us, which is all that the petitioner has submitted, we think the potential conflict between Evans and Mann was strikingly apparent from the outset. The two were jointly accused of public servant bribery. The human tendency of co-defendants to seek leniency for themselves by casting the primary blame on each other is well known. In fact, that tendency underlies our long-standing rule that the testimony of an accomplice must be corroborated. Here, as might have been foreseen, Evans, who apparently had received the city’s checks, attempted to shift the blame to Mann by testifying that it was Mann who proposed the scheme and actually profited by it. Furthermore, Evans, within a few weeks after engaging independent counsel, elected to plead guilty and agreed to testify against Mann. That turn of events, in a case involving alleged joint complicity, cannot be regarded as unforeseeable.

Mr. Callahan, primarily as defense counsel but also simply as a practicing attorney, was under a clear-cut obligation to anticipate the possibility of a conflict between the interests of his several clients. We discussed the point to some extent in Chambers v. State, 264 Ark. 279, 571 S.W. 2d 79 (1978):

We have no doubt at all about Larry’s having been entitled to independent counsel. The duty of a lawyer in Mr. Etoch’s position is clearly stated in the ABA Standards Relating To the Defense Function, § 3.5 (b) (1971):
“Except for preliminary matters such as initial hearings or applications for bail, a lawyer or lawyers who are associated in practice should not undertake to defend more than one defendant in the same criminal case if the duty to one of the defendants may conflict with the duty to another. The potential for conflict of interest in representing multiple defendants is so grave that ordinarily a lawyer should decline to act for more than one of several co-defendants except in unusual situations when, after careful investigation, it is clear that no conflict is likely to develop and when the several defendants give an informed consent to such multiple representation.”
See also the Code of Professional Responsibility, Canon 5 (1975).

The ABA Standards Relating To the Defense Function again emphasize the point in the commentary to § 3.5 by pointing out that “the risk of an unforeseen and even unforeseeable conflict of interest developing is so great that a lawyer should decline multiple representation unless there is no other way in which adequate representation can be provided to the defendants.” See also the extended quotation from an unpublished article by Alan Y. Cole in the court’s opinion in United States v. Garafola, 428 F. Supp. 620 (D.C.N.J.1977).

We do not mean that Mr. Callahan’s ill-considered decision to attempt to represent both Mann and Evans is in itself a complete answer to Mann’s insistence that he is still entitled to be represented by Mr. Callahan as the counsel of his choice. Nevertheless, the rights of an accused to “the assistance of counsel” as guaranteed by the Sixth Amendment to the United States Constitution and to be heard “by himself and his counsel” as guaranteed by Article 2, § 10, of the Arkansas Constitution do not confer an absolute choice of counsel, regardless of the circumstances. As the court said in Gandy v. State of Alabama, 569 F. 2d 1318 (5th Cir., 1978):

[N]ot all the variations of the right to counsel are absolute values. Indeed, it is a settled principle that the right to counsel of one’s choice is not absolute as is the right to the assistance of counsel. [Citations.] The right to choose counsel may not be subverted to obstruct the orderly procedure in the courts or to interfere with the fair administration of justice.

Similarly, an indigent defendant does not have an absolute right to demand the services of any lawyer he chooses. Thomas v. State, 584 P. 2d 674 (Nev., 1978).

The question is whether Mr. Callahan’s continued representation of Mann can be permitted without any substantial possibility of prejudice either to Evans or to the State. We cannot say with confidence that such a possibility does not exist.

Counsel for Evans make the point that there were many confidential communications between their client and Mr. Callahan before that attorney-client relationship terminated. That confidential information, it is argued, might be used by Mr. Callahan to Evans’s disadvantage, such as with regard to extraneous matters going to his credibility, if Callahan were permitted to cross-examine Evans. We do not regard Mr. Callahan’s suggestion that Mann be allowed to employ still another lawyer to cross-examine Evans as being a practical or satisfactory solution to a problem that arose only as a result of Mr. Callahan’s initial attempt to represent multiple defendants with potentially conflicting interests. Furthermore, counsel for the State make the point that Evans could hardly be cross-examined without the possibility of frequent interruptions in the trial, with attendant in-chambers hearings, whenever questions about confidentiality arose. In fact, just such a difficulty arose at a hearing below with respect to Evans’s change of plea, when Mr. Callahan asked Evans, on cross-examination, if he had not agreed in the first place that his interests and those of Mann were similar. The question was objected to, as involving the disclosure of a confidential communication, and led to a protracted argument between opposing counsel. The difficulty is basic. There is simply no way of determining whether a communication was confidential without first violating its confidentiality. See Holloway v. Arkansas, 435 U.S. 475 (1978).

The point was discussed in United States v. Garafola, supra. There Garafola and Dolan, co-defendants in a prosecution for possession of stolen property, were at first represented by the same attorney. On the day of trial Garafola decided to change his plea to guilty, and eventually he retained separate counsel. The court later held that the defendants’ original attorney was disqualified from continuing to represent either Garafola or Dolan, pointing out some of the same difficulties that may arise in the case at bar:

Reverting to the specific issue raised herein by Garafola’s decision now to retain separate counsel, the position of conflict in which defense counsel knowingly placed himself from and after arraignment continues to persist. This is so for several reasons. Simply by way of example, should Garafola be called as a witness by the United States upon re-trial, how can he be cross-examined effectively by his former attorney without intruding into matters protected by the attorney-client privilege. Moreover, what is to be done if Dolan wishes to waive the attorney-client privilege but Garafola does not? What is present counsel then to do? A myriad of equally complex questions are presented, simply because counsel did not, when he first ascertained all of the facts in the case, exercise that prudence which was required. Accordingly, I adhere now to my ruling of March 10, 1977, and order that Dolan retain new counsel to represent him at re-trial.

See also United States v. Lawriw, 568 F. 2d 98 (8th Cir. 1977), where the court recognized the possibility that, as in Garafola, it may sometimes be necessary to disqualify counsel from representing either of two defendants.

In discussing only what is actually the primary issue in this application for a writ of prohibition, we do not overlook counsel’s reliance upon six separate points in his brief. All of them, however, derive essentially from the main issue. That Mann did not receive specific notice that the State’s motion to disqualify counsel would be presented at the hearing below did not result in a denial of due process, as the court had already indicated that Mr. Callahan’s disqualification would be at issue; so there was no want of notice or of an opportunity to be heard.

Writ denied.

Byrd and Purtle, JJ., dissent.

John I. Purtle, Justice,

dissenting. I respectfully dissent from the majority opinion in this case. Although it is impractical to set out all the pleadings and evidence in an opinion, the majority here failed to point out that petitioner specifically waived any prejudice which might come to him by the use of Mr. George M. Callahan, the counselor of his own choosing. The opinion further fails to point out that the other two defendants, at the urging of the trial court, obtained the services of two prominent attorneys who represented both of the other defendants. Further, the opinion fails to point out that these prominent attorneys agreed they would have no objection to the petitioner continuing with the services of George M. Callahan as his attorney provided another attorney cross-examined Mr. Evans when he turned state’s evidence against the petitioner.

The majority are, in my opinion, inadvertently condoning the procedure of allowing trial courts to unduly restrict an accused in freely selecting an attorney of his choice. Neither this Court nor any other court has any right to determine whether an attorney will represent a particular client so long as the selected attorney is authorized to practice law in Arkansas.

The majority designates Callahan’s decision to represent all three defendants as ill-considered. Perhaps this is so but it might not be if under the advice of Mr. Callahan all three defendants had elected to claim their immunity under the 5th Amendment of the Constitution of the United States. It is possible that the state in this particular case might have been unable to prove their allegations without the cooperation of one of more of the original defendants. In such case we would afterwards characterize Callahan’s tactics as brilliant. Not being possessed with clairvoyant powers, I am unable to make the decision which my brothers pronounced this date.

I will admit that it is usually not wise for any attorney, or firm of attorneys, to attempt to defend more than one defendant in a particular case. However, there must be some inquiry to determine whether this is true or not. In fact, it has been held that the trial judge must make a factual reconstruction of the scope of prior legal representation and must determine whether it is reasonable to infer that any confidential information allegedly given to the attorney was given. Finally, the trial judge must determine whether that information is relevant to the issue raised in litigation pending against the former client. None of this was done in the present case. Therefore, we would have to resort to speculation and conjecture to determine whether or not Mr. Callahan should have been barred from participating in the defense of the petitioner. I am unable to do this.

It is interesting to note that shortly after the court ordered the three defendants to obtain counsel other than Callahan that a guilty plea was negotiated jointly by the two attorneys representing the Evans’ defendants. We have part of that plea abstracted in this case and it is most interesting to note after Mr. Evans had become confused on some of the dates concerning the alleged theft the court stated:

“You need to get yourself some way to straighten out those dates when you testify.”

Further addressing the petitioner, the court stated:

“Mr. Mann, if I have to act, I will act in the summary fashion. You and your attorney, Mr. Callahan, should be well aware of this. I do not expect Mr. Callahan to show up here as your attorney on February 26, if he does, you can expect, and you are given notice, that this court will act summarily, which may mean, among other things, that you may be deprived of your liberty for a while. I hope you understand that.”

The attitude of the court is further reflected when he states :

“I would like to ask the response be along the lines of disciplinary enforcement of disciplinary rules of the Supreme Court as set out in the Canons of Ethics. Since it’s come up this way it must be proceeded in this manner. If that includes suspension or disbarment of Mr. Callahan, so be it.”

It appears to me that the prosecuting attorney, the trial judge, and this Court are more interested in helping Mr. Evans, who has agreed to snitch on petitioner, than they are in protecting the rights of the accused. The petitioner has had a long association with Mr. Callahan as his attorney. He desires Mr. Callahan to continue representing him in this matter; he has confidence and trust in Mr. Callahan. So it was with Mr. Evans when he testified that he had complete trust and confidence in George Callahan as an attorney. If the state is really interested in seeing that Mr. Evans’s rights are protected, it would be a simple matter to grant him immunity.

In Reickauer v. Cunningham, 299 F. 2d 170 (1962), the court stated:

The second fact set forth in the petition which constitutes a violation of the petitioner’s constitutional rights is that he was denied counsel of his own choosing. The petitioner alleges that he “begged and plead with the officials” to allow him to write to Mr. Leith Bremner, an attorney of Richmond. He further alleges that he was prevented by the state officials from contacting any lawyer. Instead, he was compelled to accept the services of an attorney who was brought to him by the Sheriff. He, therefore, had to accept this lawyer or go without counsel. The affidavit of counsel of record does not altogether refute this statement. It states that he was called from Baltimore by some person whose identity was not disclosed to him and as a result of the call he went to the jail and offered his services to the petitioner, who accepted him. Under these circumstances the petitioner could very well have accepted the attorney under the belief that he had no other choice.

The right of self-representation has since the beginning of our Nation been held to be guaranteed. § 35 of the Judiciary Act of 1789, 1 Stat. 73, 92, enacted by the first Congress and signed by President Washington one day before the 6th Amendment was proposed, provided that “in all courts of the United States, the parties may plead and manage their own cause personally or by assistance of. . . counsel ...” It has been held that the 6th Amendment guarantee of the right of assistance of counsel implicitly embodies the right to dispense with one’s lawyer and represent himself. Adams v. U.S., 317 U.S. 269 (1942).

Arkansas Constitution, art. 2, § 10 provides that a person has the right “to be heard by himself and his counsel.” In fact, this Court has stated in Steel v. State, 246 Ark. 75, 436 S.W. 2d 800 (1969):

. . . We very quickly disagree — but of course, an accused person is entitled to retain whomever he desires to represent him.

It is hard for me to understand the majority in holding that an accused must be represented by an attorney approved by the trial judge whether the accused likes it or not. Perhaps we have provided this accused a reversible error before he is even tried.

So far as Evans is concerned, he cannot be hurt by the divulgence of any confidential information revealed to Callahan because he has made a deal and is no longer in jeopardy unless he told Callahan of other unlawful acts which he is fearful might be revealed by Callahan on cross-examination. He could then, of course, take refuge in the 5th Amendment and still not be harmed. However, it appears he does not have a great deal to fear by way of prosecution under the circumstances existing in this case.

Why was it not unethical for the same attorneys to represent the other two defendants at the same time since these two were charged with the same offense as is the petitioner? No one has accused these outstanding attorneys of being either unethical or in the position of not being able to represent their clients. It seems to me that any counsel worth his salt who takes on the defense of the petitioner is going to constitute more danger to Mr. Evans on cross-examination than would Mr. Callahan who has agreed not to reveal any confidential information previously relayed to him by Evans.

Obviously Evans is cooperating with the state fully and will, no doubt, reveal to the state confidential information furnished by petitioner to Callahan during the time they were both represented by him. Is it fair to allow the state to use the same type information we here prohibit the petitioner from using? It seems to me the courts and prosecuting attorneys are under the same duty as other lawyers to avoid even the appearance of professional impropriety. If so, perhaps everyone involved in the case up to now should recuse themselves.

If petitioner wants to use Callahan that should be his decision and not ours. After all, a man has the right to go to Hades if he so elects although I question his judgment in such case.

I would grant the writ and allow the petitioner to use counsel of his own choosing.