author: Carleton Harris, Chief Justice.

text:
    Georgia Faye Johnson MILLER v. Jimmie C. JOHNSON
    5-5924
    480 S.W. 2d 574
    Opinion delivered May 29, 1972

      Cambiano ir Cree, for appellant.

      Phillip H. Loh, for appellee.
   Carleton Harris, Chief Justice.

Appellant, Georgia Fay Johnson (Miller) instituted suit for divorce from appellee, Jimmie C. Johnson in February, 1966. Mr. Johnson did not answer the complaint and a decree was granted vesting custody of the minor children, Jimmie Carroll Johnson and Carroll Gene Johnson, in appellant. Mr. Johnson was ordered to pay child support in the amount of $80.00 per month. In March, 1967, Mrs. Johnson filed a petition for citation alleging that Johnson had failed to pay child support, but the record does not reveal that any further action was taken on this petition. The record in this case is rather sparse and successive events were explained by Mr. Johnson in his testimony. According to the witness, appellant, who in June of 1967, was living in Houston, Arkansas, and was married to a man named James Neeley, came to his home and inquired if he desired to keep the boy. Upon his reply that he would not keep one without the other, she turned both children over to him, and he has since had physical custody. Johnson said that she would sometimes keep the children for a week-end, or several hours, and then bring them back. This testimony was given at a hearing held by the Perry County Chancery Court after Johnson, in September, 1971, filed a petition for modification of the decree wherein he asserted that he and his present wife had “with some minor exceptions” the children’s physical custody. The testimony of Johnson reflected that appellant came to the house about two months prior to the hearing (held on November 10, 1971) and asked to see the children. He advised her to come back the next day and she returned with a deputy sheriff. As he was talking with the deputy sheriff, appellant left with the children. Shortly thereafter, Mrs. Miller filed another petition seeking a citation for contempt, and Johnson then filed the above mentioned petition for modification of the decree. Apparently, Mrs. Miller then left the state with the children.

Before the hearing commenced, counsel for Mrs. Miller (who had again remarried) objected to the petition for modification being heard for the reason that Mrs. Miller was married to a man in the armed forces of the United States and presently outside the continental limits of the United States at his post of duty; it was stated that Mrs. Miller was with him. Johnson said he thought that Miller was stationed in Okinawa. The second wife of appellee stated that she would like for her husband to have custody of the children and she said that she was willing to continue to rear them; that her husband was financially able to support them. Two neighbors testified that the children were given good care by Johnson and his second wife. No testimony was offered on behalf of appellant, and at the conclusion of the hearing, the chancellor made the following pertinent findings:

“1. That the parties hereto were divorced in this court on April 7, 1966, and Georgia Faye Johnson was granted the custody of Jimmie Carroll Johnson and Carroll Gene Johnson, the parties’ minor children. That since said decree was made the conditions and circumstances of the parties have changed. That with the exception of a few days at a time, the children’s physical custody has been with Jimmie C. Johnson since the divorce; that the minor children were living with their father up until about two months ago, when said Georgia Fay Johnson (Miller) came to Perry County and took the children away with her.
2. That the said Jimmie C. Johnson and his present wife, Mary Frances Johnson, have cared for said min- or children and have provided a good home for them for the last four years, and are desirous, willing and able to continue to do so.
3. That the best interest and welfare of Jimmie Carroll Johnson and Carroll Gene Johnson will be served by vesting the custody in Jimmie C. Johnson, and his petition to modify the divorce decree as to custody of the children should be granted.”

It was then ordered that permanent custody be placed with appellee, with appellant to have reasonable visitation rights.

For reversal, it is first urged that the chancellor erred in proceeding with a hearing on the merits of the petition to change custody of the two minor children of the par des, when it was impossible for one of the parties to be present, due to that party being outside the continental limits of the United States as the spouse of a service man assigned to duty on Okinawa. It is then urged that the decision of the chancellor was error since there had been no showing that Mrs. Miller was an unfit or improper person to have the custody. We proceed to a discussion of these points.

As to the first point, appellant relies on the Soldiers and Sailors Civil Relief Act, and it is urged that the court was without authority or jurisdiction to proceed with the hearing because of Mrs. Miller’s rights under this act.

We do not agree for it does not appear that Mrs. Miller is entitled to the protection of that act. There is no contention that she is a person in the military service of the United States; rather, she is the wife of a soldier stationed in Okinawa. 50 U:S.C.A. App. § 510, sets forth the purpose of the act, and makes it clear that it applies to “persons in the military service”. Section 511 then defines what is meant by “persons in the military service” as follows:

“The term ‘persons in military service’ and the term ‘persons in the military service of the United States’, as used in this Act (sections 501-548 and 560-590 of this appendix), shall include the following persons and no others-, [our emphasis] All members of the Army of the United States, the United States Navy, the Marine Corps, the Coast Guard, and all officers of the Public Health Service detailed by proper authority for duty either with the Army or the Navy.”

It will be noted that wives of service men are not included.

Nor do we agree with the second point for reversal. The chancellor apparently, in making the change of custody, gave paramount importance to the fact that Mr. Johnson and his present wife had kept the children for approximately four years, and this is certainly a change of circumstances (since the divorce decree was rendered). The record does not reflect where the children are presently located though counsel states that they are being “ably taken care of” in Okinawa. While normally the court does give preference to the mother, there are numerous instances when custody has been placed in the father, particularly where the father has had actual physical custody for some period of time. Tyler v. Tyler, 241 Ark. 98, 406 S.W. 2d 333; Stephenson v. Stephenson, 237 Ark. 724, 375 S.W. 2d 659.

Of course, there is nothing to prevent appellant, when she returns to this country from petitioning the court for a change or modification of its present order. Be that as it may, we are unable to say that the chancellor erred in the conclusions reached.

Affirmed.


source: Caselaw Access Project

author: George Rose Smith, Justice.

license: Public Domain

text:
    Billie Kay OBENSHAIN v. Harvey OBENSHAIN
    5-5915
    480 S.W. 2d 567
    Opinion delivered May 29, 1972

      Jeff Duty, for appellant.

      Davis ir Reed, for appellee.
   George Rose Smith, Justice.

The question here is whether the appellee, who is the father of the appellant’s former husband, can garnishee the appellant’s one-half interest in the net proceeds derived by the appellant and her former husband from the voluntary sale of their homestead. We find that the circuit court was right in holding that the fund in question is not exempt from the claim asserted by the appellee.

In 1970 the appellant obtained a divorce in the Washington chancery court. The parties owned a homestead in the county as tenants by the entirety. They had agreed upon a property settlement by which the homestead would be listed with a real estate broker for sale at a reasonable price. The divorce decree approved that arrangement. The property was eventually sold by the broker in 1971, the net proceeds of sale amounting to $2,051.55.

While the real estate broker was still holding the proceeds of sale the appellee brought this action against the appellant and her former husband, to recover the sum of $2,100.71 which the appellee had been compelled to pay as a result of having indorsed a note executed by the appellant and her former husband to a bank. Upon filing this action the appellee caused a writ of garnishment to be served upon the real estate broker, who has paid the proceeds of sale into the registry of the court. The appellant, having been awarded custody of the couple’s two minor children, contends that she is the head of the family and is therefore entitled to assert a homestead exemption in her half of the proceeds derived from the sale of the homestead. The circuit court rejected that contention.

The court was right. When the owner of a homestead voluntarily sells the property, the proceeds of sale are not exempt. Drennan v. Wheatley, 210 Ark. 222, 195 S.W. 2d 43 (1946). On the other hand, when the property is subjected to a forced sale, the debtor’s share of the proceeds is exempt if he intends to use the money to acquire another homestead. Sims v. McFadden, 217 Ark. 810, 233 S.W. 2d 375 (1950). Here the former rule applies, for the parties voluntarily agreed to list the property with a broker for sale at a reasonable price. We are not called upon to decide whether a sale ordered by the chancellor under Act 340 of 1947, Ark. Stat. Ann. § 34-1215 (Repl. 1962), might in some situations be considered to be a forced sale.

The appellant, to support her claim of exemption, cites our decision in Williams v. Williams, 245 Ark. 475, 432 S.W. 2d 830 (1968), where we held that the husband’s share in the proceeds derived from a court-ordered sale of the homestead could not be subjected to the wife’s judgment for delinquent child support. There, however, the wife argued only that the homestead exemption should not as a matter of policy be available against a judgment for child support. She did not argue that the court-ordered sale was voluntary rather than forced. Consequently that argument was waived. Missouri Pac. R.R. v. Harding, 188 Ark. 221, 65 S.W. 2d 20 (1933). Hence the decision is authority only for the rule specifically stated, that a homestead is exempt from a judgment for child support.

Affirmed.


author:
Lyle Brown, Justice. John A. Fogleman, Justice,
      J. Fred Jones, Justice, Conley Byrd, Justice,

text:
    A. B. HERVEY Jr., Commissioner of Revenue, v. TYSON’S FOODS, INC. et al
    5-5867
    480 S.W. 2d 592
    Opinion delivered May 29, 1972
    [Rehearing denied June 26, 1972.]

      R. David Lewis and Dewey Moore Jr., for appellant.

      Crouch, Blair, Cypert fa Waters, by James B. Blair, for appellees.
   Lyle Brown, Justice.

This action was instituted by Tyson’s Foods, Inc., and its wholly owned subsidiary, Tyson’s Feeds, Inc., poultry processors and distributors, to recover gross receipts taxes (sales) and compensating (use) taxes paid under protest. (Throughout the opinion the appellees will be referred to as Tyson.) The audit forming the basis of tax assessments herein treated was for a four-year period. The chancellor held that Tyson was entitled to prevail and recover the full amounts paid under protest. The State Revenue Commissioner appeals.

Item I claimed for exemption is based on Ark. Stat. Ann. § 84-1924 (Repl. 1960), which is a feedstuffs exemption statute. It provides that “all feedstuffs used in growing or producing livestock and/or poultry” are exempt from sales tax. Then § 84-1925 (d) defines “feedstuffs” to mean all materials which are commonly known and used as feed for livestock and/or poultry. The items claimed are called “water feed additives,” being fed to the birds through the drinking water rather than mixing with bulk feed, the latter process being ofttimes impracical. Tyson’s total purchases of additives amounted to $706,763.41. There are several such additives. Tyson’s witness described them. Vitamin D3 and Vitamin A are used to obtain maximum growth efficiency. Gallimycin, Terramycin, and Aureomycin belong to the mycin drug family. Funjol is a copper sulfate compound used to prevent mycotic infections. Alpha and Amprol are coccidiostats, added for the prevention of certain infectious diseases. The same is true of Floxaid and Vitalizer. Whit-syn S, S-Q, and S4 are sulpha drugs, used in the treatment of various diseases. Three-Mitro is an inorganic arsenical compound used to promote growth and feed efficiency. Feed efficiency is described as meaning the poultry’s ability to convert feed to body pounds.

We have been referred to only one case which deals with the classification of feed additives. Lipman Poultry Co. v. Johnson, Assessor, 138 Atl. 2d 631 (Me. 1958). There the court was called upon to determine whether certain additives came within a tax exemption statute covering feeds. The components were terramycin oil suspension, terramycin animal formula, terramycin poultry formula, and a hormone preparation called “capette pills.” There it was held that those antibiotics and hormones functioned not as feed but as catalysts to assist in assimilation of food.

According to the description of these drugs and their uses, it is reasonable to say that by their use alone they would not supply sufficient nourishment while, on the other hand, when these ingredients are administered in conjunction with poultry feed, the result is an accelerated growth of the birds.
There seems to be no place in the definition of feed as used in the statute for the inclusion of antibiotics and hormones.

It was also pointed out that the additives were used as catalysts in the body to help other reactions take place; that they never become a part of the body frame; and that when they have served their usefulness they are excreted and another supply is then needed.

In Peterson Produce Co. v. Cheney, 237 Ark. 600, 374 S.W. 2d 809 (1964), we said: “Let it also be remembered that a tax exemption must be strictly construed, ‘and to doubt is to deny exemption.’ ” In Wiseman v. Madison Cadillac Co., 191 Ark. 1021, 88 S.W. 2d 1007 (1935), we held that the burden is on the claimant “to establish clearly his right to exemption.”

In the first place we have reasonable doubt that these additives are commonly known as feeds tuffs. Secondly, appellee has not met the burden of clearly showing the right to exemption.

Item II claimed as exempt from sales tax is described by appellees as components “consumed as integral part of the production of broilers.” Under that heading they list the specific items of nest pads, feeder lids, filter flats, litter, vaccine and medicine, and spray. The exemption is claimed under Ark. Stat. Ann. § 84-1904 (Repl. 1960): “Goods, wares, merchandise, and property sold for use in manufacturing, compounding, processing, assembling or preparing for sale, can be classified as having been sold for purposes of resale or the subject matter of resale only in the event such goods, wares, merchandise, or property becomes a recognizable, integral part of the manufactured, compounded, processed, assembled or prepared products.” We do not agree with appellees simply because we are unable to conceive that the items listed become a recognizable, integral part of the finished products.

For the last four months of the audit exemption is claimed for the listed Item II under the Acts of 1967, Act 113. The section does not appear in the annotated statutes because it is no longer the law. There the exemption provision says: “Gross receipts or gross proceeds derived form the sale of. . .tangible personal property used for repair, replacement, or expansion of existing manufacturing or processing facilities ...” Manufacturing and processing have been held not to be two distinct operations. Processing is carried out under the manufacturing process. Pellerin v. Cheney, 237 Ark. 59, 371 S.W. 2d 524 (1963). The taxpayer must first qualify as a manufacturer. Scurlock v. Henderson, 223 Ark. 727, 268 S.W. 2d 619 (1954). We have specifically held that a processor of chickens is not a manufacturer. Peterson v. Cheney, 237 Ark. 600, 374 S.W. 2d 809 (1964). For an exhaustive treatise on the last subject see Prentice v. City of Richmond, 90 S.E. 2d 839 (Va. 1956).

Item III concerns a claimed exemption from the use tax and is based on a part of Acts 1961, Act 140 (which is no longer the law and is not now incorporated in the annotated statutes.) See footnote to Ark. Stat. Ann. § 84-3106 (Supp. 1971): “Tangible personal property in the form of raw materials or component parts for further processing, manufacturing, or assembling when such goods, wares and merchandise goes into and becomes a recognizable, integral or component part of a manufactured or processed article or end-product for sale either within or without the State of Arkansas.” The items listed for exemption by appellees are egg processing equipment, poultry processing plant equipment, poultry processing plant repairs and replacements, hatchery equipment, feeder lids, trays, pads and cases for baby chicks. For two reasons the claimed exemption is without merit. The claimed items do not become an integral part of the end product. Secondly, as we have heretofore stated, appellees are not manufacturers. For the last four months appellees claim exemption under Act 113 of 1967. What we have said with respect to the exemption claimed during the last four months under Item II applies here.

For the reasons stated we conclude that appellees’ claims for exemptions are not authorized by law.

Reversed.

Byrd and Holt, JJ., dissent.

Fogleman and Jones, JJ., concur.

John A. Fogleman, Justice,

concurring. I agree with the dissenting opinion to the extent that the exemption encompasses any materials which are (or were at the time of the passage of the act) materials commonly known and used as feed for poultry and used in growing or producing poultry. I cannot see that appellees met their burden of proving that the items assessed were exempt. Apparently appellant lumped them all under the heading “Medication placed in water.” Appellees seem to list them as “Water feed additives.” I cannot tell what particular items are included in either. I think that through the testimony of Tyson it was clearly shown that vitamins and antibiotics were, at the time of the passage of the act, commonly a part of the feedstuff for chickens and are now given to the chickens in appellees’ operation by adding them to water instead of feed. Apparently a considerable amount of the materials involved is vitamins and antibiotics. But it appears that among materials involved are such as Funjol, a copper sulfate compound for prevention of myotic infections, and Piperazine, a worming compound. These are clearly medications which I understand from the testimony are frequently administered in the feed mix given chickens but may also be administered in water. Showing that a medication may be, or that it is frequently, administered in feed does not mean that it is or was commonly known and used as feed. Yet, I find no means of separating those items which are, or were, commonly known and used for feed and those which may be and are frequently administered in feed mix. The burden of making this showing was upon appellees.

J. Fred Jones, Justice,

concurring. I concur in the conclusion reached by the majority in this case because I am unable, from the record before us, to separate the items that I would be willing to accept as “feedstuff” under the statute from the items I consider clearly medication. I would consider vitamins and minerals as “feed-stuff” commonly known and used as feed, but I do not so consider worming compounds and medical preparations to guard against infection. We are concerned here with materials commonly known and used as feed and not materials commonly known and used in feed. I agree that the appellees failed to meet their burden of proving that the items assessed in this particular case were exempt.

Conley Byrd, Justice,

dissenting. I disagree with the portion of the majority opinion that rewrites the definition of “feedstuffs.” Not only does the majority opinion ignore the definition of “feedstuffs” but it relies as authority upon a Maine case, Lipman Poultry Company v. Johnson, 138 Atl. 2d 631 (Me. 1958), which did not involve a “feedstuff” exemption.

The statute here involved, Act 94 of 1955, provides:

“Section 1. All feedstuffs used in growing or producing livestock and/or poultry in this State shall be exempt from the provisions of Act 386, Ark. Acts of 1941, as amended by Act 15, Ark. Acts of 1949, known as the Arkansas Compensating Tax Act.
Section 2. The following words and phrases shall, except where the context clearly indicates a different meaning, have the following meanings:
(a) . . .
(d) Feedstuffs: The term “feedstuffs” is defined to mean all materials which are commonly known and used as feed for livestock and/or poultry including unmixed or unprocessed grains; unground hay; whole or ground straw, and hulls when not mixed with other materials.”

It will be observed that the exemption is not to feed but to “feedstuffs”. Furthermore, the exemption is not limited to “feedstuffs” used in growing livestock and/or poultry but by the very terms of Section 1 of the Act “feedstuffs” used in PRODUCING livestock and/or poultry are also exempted. Thus up to this point, I could not conceive of any fair minded reader construing the exemption as applying to nutrients only until I read the majority opinion.

Section 2 (d) of the act defines “feedstuffs” in terms of “ALL MATERIALS commonly known and used as feed for livestock and/or poultry.” Webster’s International Dictionary defines “MATERIAL” as “the substance or substances, or the parts, goods, stock or the like, of which anything is composed or may be made; as, raw materials.” The same dictionary, a 1935 edition, defines the noun “feed” as a “mixture or preparation for feeding livestock.” Thus when the definitions are put together, we find the statutory definition of “feedstuffs” to mean ALL MATERIALS WHICH ARE COMMONLY KNOWN AND USED AS a mixture or preparation for feeding livestock or poultry.” Of course Section 1 makes it plain that all such materials are exempt if they are “used. . .in producing” livestock or poultry.

The Maine case of Lipman Poultry Company v. Johnson, supra, involved a totally different statute. The Maine Statute Chap. 17, § 10 (VII) provided:

“Sec. 10. No tax on sales, storage or use shall be collected upon or in connection with:
VII. Sales of seed, feed and fertilizer used in Agricultural production. . ,

Thus having shown that the drafters of the statute intended to exempt all feedstuff material used in the production of livestock and poultry, the only issue is whether such products are commonly known and used as such. Here again the majority ignore the record.

Dr, Robert W. Keirs, an Iowa State College graduate of veterinary medicine, testified that he had been connected with the poultry industry since 1958. He was familiar with the practice of administering materials which might be classified as drugs or medications or growth stimulants to poultry in Northwest Arkansas. He was familiar with such trade names as Vitapol, Floxaid and Vitilizer. These are trade names for mixtures of antibiotics- and vitamins. Their use is primarily with starting poultry in the first few days of life and are administered at other times during the period of production. “Birds don’t have to be sick or have anything wrong with them for these materials to be administered. The purpose of administering them is to better the conversion of feed protein and make the birds grow faster.” The materials can be administered in solid feed mix and are frequently fed that way in the industry. There is no appreciable difference in purpose or results when the materials are fed to the birds in water as compared to solid feed. The basic and primary purpose of feeding antibiotics at low levels is to promote growth and feed efficiency.

Dr. David B. Fields, a veterinarian at Springdale, Arkansas, testified that he was at one time a director of the State Diagnostic Laboratory and that in his capacity as director of that State institution he had become aware of the practice of the poultry industry and how they feed chickens. He agreed with Dr. Keirs that mycin drugs and the vitamin compounds are used to increase feed efficiency either by growth or disease control. Such items are fed both in water and in feed.

Dr. P. W. Waldrup, associate professor of poultry nutrition at the University of Arkansas, had published several reports on some of the mycins. He agreed with Dr. Keirs that the primary function of the vitamins and antibiotics involved was to increase the growth rate or feed conversion of poultry. He pointed out that the antibiotics and vitamins had been cleared by the F.D.A. for use in feed. According to him a typical broiler diet would, in addition to grain, soybean meal and poultry byproducts, include such things as limestone, phosphate source, salt and a vitamin mixture.

Don Tyson graduated from the University of Arkansas in 1951, having taken all of the available animal and poultry nutrition courses that were offered. He has worked for Tyson’s since his graduation. He stated without equivocation that in such capacity he was in a position to know what ingredients were commonly sold and administered as feedstuffs in the State of Arkansas at the time Act 94 of 1955 became effective (Tyson produces over 800,000 tons of feed per year). He states- that when “feedstuffs” were exempted, vitamins and antibiotics were commonly known and used for feed for poultry.

Added to the foregoing testimony is the fact that appellant and his predecessors recognized the vitamins and antibiotics to constitute “feedstuffs” until the present suit was filed.

Thus we have the testimony of experts in poultry and poultry nutrition, all of whom recognize that vitamins and antibiotics are materials commonly known and used in the growth and production of poultry. In addition, appellant and his predecessors recognized the materials as Exempt. Under these circumstances I’m at a loss to understand the majority’s doubt that vitamins and antibiotics were “commonly known and used” in poultry feed. I, myself, find that all of the materials here involved are commonly displayed in the ordinary farm supply and feed store for purchase by any citizen without the necessity of a prescription or question as to the use thereof, and in containers giving directions for feeding to livestock or poultry. Added to the above is the recitation of the use of the antibiotics in the Lipman case, and the recognition given to the problem by the Maine Legislature in amending the Maine statute.

For the reasons stated I would affirm as to the vitamins and antibiotics.

Holt, J., joins in this dissent.

      Item No. VII during the pendency of the Lipman case was amended to read: “Sales of seed, feed, hormones, fertilizer, pesticides, insecticides, fungicides, weed killers, defoliants, litter and medicines used in agricultural production... .”


author: John A. Fogleman, Justice.

text:
    Mrs. R. J. McNATT v. Bert B. LAREY, executor and trustee under the will of Frank BENTLEY, deceased, et al
    5-5895
    480 S.W. 2d 562
    Opinion delivered May 29, 1972

      W. H. Arnold, Jr., Richard S. Arnold, and Arnold <lx Arnold, for appellant.

      Tackett, Moore, Dowd ix Harrelson by: C. Wayne Dowd, and Wheeler, Watkins, Hubbard, Patton if Peek by: Larry Wright, for appellees.
   John A. Fogleman, Justice.

This case involves the construction of the will of Frank Bentley, insofar as it relates to a devise to Mrs. R. J. McNatt, a friend of the testator and his tenant for about 15 years on the lands involved. The devise is made in Item “FOURTH” of the will, which reads:

At this time I have leased to Mrs. R. J. McNatt (along with her husband, R. J. McNatt, Sr.) the following real estate situated in Miller County, Arkansas, to-wit: * * *for the sum of $50.00 per month, rental, payable in advance, said original lease heing for a term of 3 years, beginning February 4, 1964, and ending January 31, 1967; and extended for an additional three years, from January 31, 1967, to January 31, 1970, upon the same terms and conditions as the original lease. At my death, I give, devise 2nd bequesth to Mrs. R. J. McNatt, the right to continue to lease said property for so long as she desires to lease said property, upon the same terms and conditions as is now leased, or, if she should elect to do so, after my death, I give, and devise to her the option to purchase said property for the sum of Sixteen Thousand and No/100 ($16,000.00) Dollars, the payments to be made on same at the rate as the rental on the property which is $50.00 per month, until the purchase price is paid in full.
I hereby authorize and empower my Executor and Trustee, hereinafter named, to execute any and all deeds, conveyances and papers necessary to effect said conveyance to Mrs. R. J. McNatt, in the event she exercises her option to purchase said property.
In the event Mrs. McNatt should elect not to exercise the option to purchase, then she is to notify my said Executor and Trustee, by certified mail, thirty (30) days before the expiration of her lease on said property, and upon such notification, then this property shall become a part of the residue of my estate, and disposed of as hereinafter set forth.

Mrs. McNatt exercised the option to purchase on January 18, 1971. The executor proposed that the devise be carried into effect by an “Installment Vendor’s Lien Note” for the amount of the purchase price, with interest at 6% per annum, computed monthly, payable in monthly installments of $50 each, with the purchaser having the privilege of paying interest at any time she chose in order to reduce the sum due as principal and interest. This note was to be made in connection with a contract of sale proposed by the executor setting out the terms as to payment of the purchase price but giving the purchaser the right to make prepayments of all or any part of the consideration, in addition to the prescribed monthly payments.

The probate court held that appellant’s exercise of her option to purchase was effective on October 20, 1971, and that she was required to execute a note and contract on the terms proposed by the executor in order to effectuate her purchase of the lands. Appellant contends that she should not be required to pay interest on the purchase price or unmatured installments thereof, that the effective date of the purchase was January 19, 1971, the date notice of the exercise of the option was received by the executor, that the purchase should be carried into effect by a warranty deed reserving a vendor’s lien and that she should have the revenues from the property after the effective date of her purchase. Since we agree with appellant, we reverse the judgment of the probate court.

At the time of the testator’s death, Mrs. McNatt was in possession of the property under an extension of the terms of a lease executed in 1964. The lease provided for rental payable in advance with $40 per month allocated to a house on the property and $120 per year to pasture. There is a provision in the lease for pro rating the pasture rental at the rate of $10 per month during the last year of the lease, since the pasture rent had been prepaid up until October 15, 1964, while the original term of the lease ran from February 1, 1964, to January 31, 1967. At the time of Bentley’s death on December 12, 1970, Mrs. McNatt had paid the pasture rental for one year beginning in October, 1970. She also had paid the house rental for September, October, November and December 1970. After Bentley’s death, she commuted to pay the house rents to his estate.

Mrs. McNatt was agreeable to the retention of a vendor’s lien on the property, and acknowledged that she should pay taxes on the land and carry insurance. She did pay the 1970 taxes. She testified that she first knew of the probate of the Bentley will on Saturday, January 16, just before she exercised the option to purchase. The executor acknowledged that if interest were charged, the purchase price could never be paid at the rate of $50 per month because the interest would exceed the monthly payments, and the total debt would increase rather than decrease. In an action on a contract, we found that it was unreasonable to believe that a purchaser would enter into such an agreement. Belew v. Griffis, 249 Ark. 589, 460 S.W. 2d 80.

Appellees contend that the testator intended that the executor determine the terms and conditions of the sale, except as specifically set out in the fourth item of his will. They rely upon the authorization to the executor to execute any and all deeds, conveyances and papers necessary to effect said conveyance to Mrs. McNatt, coupled with Item FIFTH and the. first sentence of Item EIGHTH, which are:

All the rest, residue and remainder of my property, real, personal and/or mixed including all moneys in the bank, either checking or savings accounts, bonds and all personal property of every kind and nature, whether in Miller County, Arkansas, or any other State of the United States of which I shall be seized or possessed, or to which I shall in any way be entitled at the time of my death or over which I may have any power of appointment, either by Will, deed or otherwise, I give, devise and bequeath to Bert B. Larey, IN TRUST, however, for the purposes of carrying the provisions of this will into effect, and for the use and benefit of the Temple Memorial Crippled Children’s Home, Texarkana, Arkansas.

To that end, I authorize and empower said Bert B. Larey to convert any real property left at my death into cash, and hereby authorize and empower my said Trustee at his discretion, as to time, to sell and dispose of all or any part of my real or personal property, at public or private sale or sales for such price or prices and upon such terms and conditions as to him may seem best, with power to carry out the provision of the Fourth Item hereof, as provided therein, along with selling and converting any and all other properties into cash, giving my said Trustee full power and authority to execute and acknowledge deeds, leases and any and all other instruments of conveyances necessary, and it is my intention that such conveyances shall be sufficient in law, and upon full compliance being made with the terms of any such sale or sales, thereupon; * * *

I appoint Bert B. Larey as Executor (and as Trustee hereinbefore named), and direct that upon my death that my said executor take immediate possession of all of my estate, giving him full power to execute all papers necessary for carrying out the provisions of this my last will and testament, until the administration is closed.

Appellees take the position that title to the land vested immediately in the executor as trustee as a part of the testator’s residuary estate, and, since this was the only real estate owned by Bentley when he died, the provisions authorizing the trustee to convert his real property into cash apply to this transaction so that the terms and conditions of the sale to Mrs. McNatt were to lie within the discretion of the trustee. They particularly emphasize the phrase “with power to carry out the provision of the FOURTH Item.”

We do not agree that this property would be a part of the residuary estate before Mrs. McNatt notified the executor and trustee that she elected not to purchase the lands. When we read the entire will and particularly those provisions hereinabove set out, we are unable to say that the power to carry out the provision of the FOURTH Item means anything more than a recognition of that item and the powers there invested in the trustee, and a grant of the additional power to dispose of the property when it did become a part of the residuary estate as provided in the FOURTH Item of the will. We cannot accept a construction of the will that would result in an installment sale in which the purchase money debt for which Mrs. McNatt would be personally liable would constantly increase in spite of timely payment of monthly installments prescribed. The will provision that payments be made at the rate of $50 per month “until the purchase price is paid in full” would thereby be rendered meaningless.

Appellant also objects to the probate judge’s holding that her exercise of the option gave her the right to purchase, effective October 20, 1971, the end of the term for which she had paid the pasture rental prior to Bentley’s death. We do not find anything in the will which requires this holding. As we view it, Mrs. McNatt’s right to purchase became fully effective on the date she gave notice of the exercise of her option. The only significance of the termination of her lease, if indeed it did terminate on October 20, 1971, was that Mrs. McNatt’s election not to purchase was required 30 days before that date. We do not know of any reasons why the effective date of the purchase should be delayed until a will contest was barred, as argued by appellees, who cite no authority to support this contention.

The probate court rejected certain objections made by appellant to the contract and vendor’s lien note proposed by appellees. She insists that the sale be made by deed retaining a vendor’s lien, particularly in view of the fact that the property has been appraised at $52,500. She objected to provisions for forfeiture for failure to perform with recovery and retention by appellees of installments paid as rental for the use and occupancy of the property prior to the forfeiture, and to the fact that the note is contradictory to the contract in that it provides for acceleration and foreclosure rather than forfeiture. In view of the desirability of appellant’s having evidence of her purchase which is subject to record and in view of the long period of time required for full payment of the purchase price in monthly installments and in order to facilitate alienability by appellant, the majority of the court feels that the sale and purchase should be carried into effect by appropriate deed retaining a vendor’s lien. The deed should provide for some reasonable notice giving appellant a grace period for curing any defaults on her part.

Appellant also argues against a restriction by the proposed contract to performance by her personally rather than by her heirs and assigns. This was inserted on the ground that the privilege of purchasing at such a modest price was personal to her. While it might have been argued with some force that the option was personal to Mrs. McNatt, once she exercised that option, her purchase was effective, and there should be no limitation or restriction on her assigning her contract, alienating the property, or descent of her rights under our laws of descent and distribution. We do not consider other objections by appellant as material.

The judgment is reversed and the cause remanded for further proceedings consistent with this opinion.


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

text:
    SECURITY INS. CO. OF HARTFORD v. William Maurice OWEN et al
    5-5794
    480 S.W. 2d 558
    Opinion delivered May 29, 1972

      Bridges, Young, Matthews ir Davis, for appellant.

      Jones & Matthews, for appellees.
   Conley Byrd, Justice.

Appellant Security Insurance Company of Hartford had issued to W. H Marks an automobile liability insurance policy with limits of $50,000 for each person and also a Farmer’s Comprehensive Personal Liability policy with limits of $25,000 for each person. As a result of an injury received by William Maurice Owen on August 7, 1965, when he was 16 years of age, a judgment was entered against Marks in favor of appellees William Maurice Owen and his father, Maurice Owen, in the total amount of $34,250. Appellant paid the policy limits under its Farmer’s Comprehensive Personal Liability but denied coverage under the automobile liability policy because of the following exclusion:

“This policy does not apply:
(d) under coverage A to bodily injury to or sickness, disease or death of any employee of the insured arising out of and in the course of (1) domestic employment by the insured, if benefits therefor are in whole or in part either payable or required to be provided under any Workmen’s compensation law, or (2) other employment by the insured.”

The jury found the issues in favor of appellees and a judgment in the total amount of $14,091 including penalty and attorney’s fees was entered. For reversal appellant contends that Instructions 6 and 8 were erroneous and that the court erred in refusing its requested Instructions 9 and 11.

The record shows that young Owen’s grandfather and Mr. Marks were good friends. As such they used the same duck club and on occasions young Owen was permitted to hunt at the duck club. On the day in question Mr. Marks was using his pickup truck to pull a tractor and “bush hog” to the duck club. This required a person to ride on the farm tractor to guide and brake the tractor when appropriate to prevent the tractor from colliding with the truck. When the regular tractor driver did not show up, Mr. Marks asked young Owen to ride on the farm tractor. While enroute to the duck club an accident occurred which resulted in the judgment against Marks.

At the trial young Owen testified that Mr. Marks had never paid him any compensation or told him that he would be working for him. Admittedly he admired his grandfather’s friend and of course followed any directions that Mr. Marks gave him.

Mr. Marks testified that he did not pay young Owen by check during the entire year 1965, and did not make any income tax deduction for anything paid. He may have paid him something out of his pocket but he sometimes worked without pay. He had intended to pay the boy on the day in question but had not told the boy so. The boy did not ask for pay — he got to go hunting down there.

Appellant introduced some signed statements by both young Owen and Mr. Marks to the effect that young Owen was to be paid $7.50 for his day’s work. While the statements are rather cogent evidence, there is other evidence in the record that insinuates that perhaps appellant’s adjuster had suggested to the parties that Mr. Marks had no coverage unless young Owen could be classified as an employee under the Farmer’s Comprehensive Liability Policy.

Instruction No. 6 given by the court provided:

“Contracts of insurance should receive reasonable construction so as to effectuate the purposes for which they are made.”

Instruction No. 7 provided:

“If the terms used in an insurance policy are clear, they are to be taken and understood in their plain, ordinary and popular sense.”

Instruction No. 8 provided:

“If the language used in an insurance policy is not clear, and reasonable doubt exists as to the construction of the policy, it should be interpreted against the insurance company which has drawn the agreement.”

Appellant’s requested Instruction No. 9 provided:

“The automobile liability policy issued toW. H. Marks by defendant (or its predecessor) which was in effect on August 7, 1965, specifically provides that there is no liability coverage for bodily injury to any employee of the insured, W. H. Marks, arising out of and in the course of employment by the insured. Therefore, if you find from a preponderance of the evidence that at the time of the August 7, 1965, accident, William Maurice Owen was an employee of W. H. Marks, whether part-time, temporary, casual or otherwise, then you are told to return a verdict in favor of defendant.”

Upon the refusal to give the above Instruction, appellant offered a modification thereof which the court gave as follows:

“The automobile liability policy issued to W. H. Marks by defendant (or its predecessor) which was in effect on August 7, 1965, specifically provides that there is no liability coverage for bodily injury to any employee of the insured, W. H. Marks, arising out of and in the course of employment by the insured. Therefore, if you find from a preponderance of the evidence that at the time of the August 7, 1965, accident William Maurice Owen was an employee of W. H. Marks, then you are told to return a verdict in favor of the defendant.”

Appellants requested Instruction No. 11 provided:

“The term ‘employment’ means a relationship existing between one person called an employer and another person called an employee. An employee is one who performs services for the employer, under an express or implied agreement, and who is subject to the employer’s supervision, direction and control as to the manner of performing the services.”

The trial court refused appellant’s requested No. 11.

Appellant then suggested the following modification:

“The term ‘employment’ means a relationship existing between one person called an employer and another person called an employee. An employee is one who performs services for the employer, under an express agreement for compensation, or in anticipation that he will be compensated for his services, and who is subject to the employer’s supervision, direction and control as to the manner of performing the services.”

The court agreed to give the modified Instruction No. 12 on condition that Instructions No. 6 and 8, supra, which had been tentatively declined, be also given.

The trial court properly refused appellant’s requested Instructions No. 9 and 11. Exclusions such as the one here involved are generally recognized and construed as excluding that coverage which is usually available through workmen’s compensation insurance. In fact appellant in this instance recognized that construction of the exclusion by stating to the trial court:

“Judge, the whole purpose of this exclusion is not to cover under liability coverage people who are eligible to be covered under workmen’s compensation and if Mr. Marks had workmen’s compensation for his employees this boy would be covered as an employee just as sure as I am sitting here. . . .”

The term “employee” under our Workmen’s Compensation Law, Ark. Stat. Ann. §81-1302 (b) is defined as follows:

“ ‘Employee’ means any person, including a minor, whether lawfully or unlawfully employed, in the service of an employer under any contract of hire or apprenticeship, written or oral, expressed or implied, but excluding one whose employment is casual and not in the course of the trade, business, profession or occupation of his employer.”

Having admitted that the exclusion of “bodily injury to... any employee of the insured arising out of and in the course of...employment by the insured,” had reference to persons eligible to coverage under the Workmen’s Compensation Law, the trial court in construing the policy language most strongly against the insurer and in favor of the insured, properly modified appellant’s requested Instructions No. 9 and 11.

Appellant in insisting that it was entitled to have the jury told that the term employee included "part-time, temporary, casual or otherwise,” relies upon our case of Walker v. Countryside Casualty Co., 239 Ark. 1085, 396 S.W. 2d 824 (1965). In that case only two questions were involved — i.e., (1) whether the insurance policy excluded coverage to employees when the employees were not covered by workmen’s compensation, and (2) whether Walker was an employee of Koch as a matter of fact. We there held that lack of workmen’s compensation coverage did not affect the exclusion and that there was substantial evidence to support the circuit court’s finding that Walker was an employee within the exclusion. Of course in that case, there was no doubt that Walker’s employment, if he were an employee, was in the course of Koch’s trade or business. Here, however, there is an issue on fact as to whether young Owen was acting in the course of Mr. Marks’ business as a farmer when going to clean up a duck hunting club.

Finally appellant contends that the definition in AMI §701 required the court to give its requested Instruction No. 11. A review of the comments under § 701, supra, demonstrates that the draftsmen of the AMI were dealing with that vicarious liability imposed upon a master for the conduct of a servant in a tort action. This is a contract action— the draftsmen did not undertake to define the term in the context used in the "exclusion” here involved. The authorities require courts to strictly interpret exclusions to insurance coverage and to resolve all reasonable doubts in favor of the insured who had no part in preparation of the contract, First Pyramid Life Ins. Co. v. Thornton, 250 Ark. 727, 467 S.W. 2d 381 (1971).

While the language in Instruction No. 6 may have been harmless if it stood alone, we have concluded that the trial court erred in giving it and Instruction No. 8. The true rule seems to be that the construction and legal effect of a contract are to be determined by the court as a question of law except in those instances where the meaning of the language depends on disputed extrinsic evidence. See Couch on Insurance 2d § 78:90 and 17A C.J.S. Contracts § 616. It therefore follows that on the record here it was the duty of the court to construe the language of the insurance contract most strongly against appellant and not the duty of the jury. The duty of the jury is to find the facts in accordance with the instructions.

.Appellees suggest that appellant has waived its right to complain of Instructions 6 and 8 because of its insistence on Instruction No. 12. Since Instruction No. 12 is apparently a correct statement of the law, we are unable to find a waiver through invited error.

Reversed and remanded.

Harris, C. J., dissents.

Fogleman, J., dissents in part.

John. A. Fogleman, Justice,

dissenting in part, concurring in part. I feel that appellant was entitled to its instruction No. 9 as offered. It was entitled to have the jury informed that there was no requirement that young Owen be a regular employee in order to make the exclusion applicable. In Walker v. Countryside Casualty Co., 239 Ark. 1085, 396 S.W. 2d 824, we said:

It is pointed out that at the time of the injury, neither Koch nor Walker had discussed payment for the assistance that Walker would render in greasing the truck. As an alternative contention, it is asserted that, at most, Walker was only a casual employee, and that the term “employee,” as used in automobile exclusionary clauses, should apply only to regular employees as distinguished from casual or incidental employees. We cannot agree with these assertions, and it appears that the weight of authority is against appellants’ contentions. The policy provides that there is no coverage for bodily injury to any employee (arising out of employment by the insured).
* * *

A succinct discussion of the meaning of employment is found in Pennsylvania Casualty Company v. Elkins, 70 F. Supp. 155 (E. D. Ky.). There, the employment of the injured person, Nave, was certainly incidental, for Nave was regularly employed elsewhere but on the occasion in question, agreed to accompany Elkins on h trip to Tennessee for the purpose of delivering a load of cattle. While on the return trip, the truck, driven by Elkins, overturned, and Nave was killed. Elkins’ automobile liability insurance policy contained the provision that coverage was excluded for “bodily injury to or death of any employee of the insured while engaged in the employment, other than domestic, of the insured.” The party contending that coverage was afforded argued:

“That at the time of the accident which resulted in his death Ernest Nave was not an ‘employee’ of William Elkins, the insured, in any sense of the word but, having other regular employment, he was merely a casual incidental and temporary helper, voluntarily rendering a particular service as an accommodation to Elkins;
“That the phrase ‘any employee,’ as used in the exclusion provision of the policy is ambiguous and that it is susceptible of being interpreted in a restrictive sense importing regularity and continuity of service for wages or salary rather than in the broader sense including every type of the relationship of employee and hence, under the familiar rule that where a provision of an insurance policy is open to two or more interpretations the one most favorable to the insured must be adopted, the exclusion clause of the policy here in question should be interpreted to have no application to Ernest Nave whose employment, if such relation existed at all, was only casual and temporary.”

The court, in rejecting this argument, stated:

“The exclusion clause in the policy in question is obviously designed to exclude from coverage every type of employer’s liability, other than that arising from ‘domestic employment,’ regardless of whether the employment be regular and continuous or incidental and temporary. The words used make the broad indiscriminate exclusion sufficiently clear. To hold otherwise would be to make a new contract for the parties entirely different from that which they made for themselves.”

I agree that there was error in giving instruction No. 8. We said in Walker v. Countryside Casualty Co., supra, that the following exclusion of coverage was not ambiguous:

“Bodily injury to any employee of the insured arising out of and in the course of (1) domestic employment by the insured, if benefits therefor are in whole or in part either payable or required to be provided under any workmen’s compensation law, or (2) other employment by the insured.”

I find no reason for any rule of construction to be applied either by the court or jury in this case.


author: Conley Byrd, Justice.

text:
    A. B. HERVEY, Jr., Commissioner of Revenues v. CONSTRUCTION HELICOPTERS, Inc.
    5-5919
    480 S.W. 2d 577
    Opinion delivered May 29, 1972
    [Rehearing denied June 26, 1972.]

      R. David Lewis, for appellant.

      House, Holmes & Jewell by: Tom F. Lovett, for appellee.
   Conley Byrd, Justice.

Appellant A. B. Hervey Jr., Commissioner of Revenues, brought this action against appellee Construction Helicopters, Inc., a nonresident contractor, to recover $23,100 in use taxes and penalties pursuant to Ark. Stat. Ann. § 84-3129 et seq. (Supp. 1971), for the use of a $700,000 helicopter in the performance of a contract in this State. The trial court dismissed the complaint because it did not allege that the helicopter was procured for use in this State.

We affirm the trial court for the reasons stated in Larey, Commissioner of Revenue v. Wolfe 242 Ark. 715, 416 S. W. 2d 266 (1967). Appellant readily recognizes the Larey case as being contrary to the position he is now arguing but suggests that the interpretation there given is contrary to the legislative intent as revealed in the words of the statute. He also suggests that the Larey interpretation is contrary to the philosophy of the sales and use tax laws. In making these assertions, appellant overlooks our many cases to the effect that any ambiguity or doubt in a tax act is to be resolved in favor of the taxpayer. See Wiseman v. Arkansas Utilities Co., 191 Ark. 854, 88 S.W. 2d 81 (1936) and Thompson v. Chadwick, 221 Ark. 720, 255 S.W. 2d 687 (1953). His position also ignores the constitutional quagmires that would develop in assessing a $21,000 use tax against a nonresident contractor having only a $10,000 contract.

Affirmed.


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

text:
    Dorothy HOLLAND v. STATE of Arkansas
    5718
    480 S.W. 2d 597
    Opinion delivered May 29, 1972

      Jack Holt, Jr. and Jack Sims, for appellant.

      Ray Thornton, Atty. Gen., by: John D. Bridgforth, Asst. Atty. Gen., for appellee.
   Conley Byrd, Justice.

Appellant Dorothy Holland appeals from the action of the trial court in overruling her motion for a discharge under Ark. Stat. Ann. § 43-1709 (Repl. 1964), on the grounds that she has been denied her constitutional right to a speedy trial. In overruling her motion for discharge, the trial court entered the following order:

“On this 28th day of January, 1972, comes on for hearing the motion of the Defendant to dismiss the charge herein with prejudice for failure to bring the accused to trial within the time required by Ark. Stats. (1964 Repl.) § 43-1709 and from the record and stipulations of counsel, the court doth find:
“The record reflects without dispute that on the dates indicated the following proceedings occurred:
(1) September Felony information executed and 29, 1969 filed, charging Defendant with voluntary manslaughter;
(2) September 29, 1969 Defendant committed to Arkansas State Hospital for observation under Act 3 of 1937;
(3) October 30, 1969 Defendant released and Máde arid filed bail bond in the sum of $1,000;
(4) August 10, 1971 Defendant filed motion to dismiss under Ark. Stat. § 43-1709;
(5) November 24, 1971 Plea and arraignment. Deferidant entered plea of not guilty and not guilty by reason of insanity;
(6) January 28, 1972 Defendant’s motion to dismiss under Ark. Stats. § 43-1709 denied and dismissed.
“That the following stipulation was entered into in open court by attorneys for the parties herein, to-wit: The term in which the information is filed must be counted in determining the number of court terms expired; four terms have expired herein counting therefrom; that the Defendant who was released on bond was at all times within the jurisdiction of the Court; and neither the State nor the Defendant has requested a continuance herein.
“That at the request of the Defendant the State was then offered the opportunity of presenting evidence or good cause for the alleged delay in bringing the Defendant to trial. The State declined to submit such proof. The Court finds as a matter of law that the terms herein must be counted from the Defendant’s plea and arraignment. That date being within the three terms of court, Defendant’s motion for dismissal must be denied.
“It is, therefore, considered, ordered and adjudged that the motion to dismiss by Defendant hereby is overruled, denied and dismissed; that the Defendant prays for an appeal from this order which is hereby granted.”

Arkansas Stat. Ann. § 43-1709 (Repl. 1964) upon which appellant relies provides:

“If any person indicted for any offense, and held to bail, shall not be brought to trial before the end of the third term of the court in which such indictment is pending, which shall be held after the finding of such indictment, and such holding to bail on such indictment, he shall be discharged, unless the delay happened on his application.”

This statute was first construed in Stewart v. State, 13 Ark. 720 (1853). This court there in construing Ark. Stat Ann. § 43-1708, a similar statute providing for the discharge of one confined in prison, concluded that before a prisoner is entitled to a discharge for want of prosecution, he must have placed himself on the record in the attitude of demanding a trial, or at least of resisting postponements. In so doing the court recognized that the statute was declaratory of the constitutional requirement of a speedy trial.

The construction given the statute in the Stewart case was weakened in Ware v. State, 159 Ark. 540, 252 S.W. 934 (1923). There the petitioners had been indicted for murder in the first degree at the October 1919 term. They had been twice convicted and twice reversed by this court. Their motions for discharge were filed at the April 1923 term of court. In granting the motions for discharge and in speaking of the Stewart case, this court said:

“. . .As we interpret that decision, the prisoner will be entitled to his discharge under the statute for want of prosecution — that is, by reason of a failure on the part of the State to demand trial and produce her evidence against the prisoner — unless the delay was for some other reason than simply a failure on the part of the State to demand a trial and bring forward its evidence. It is such want of prosecution on the part of those intrusted with the due administration of the law that this statute condemns by discharging the prisoner upon his application and a showing that the State had failed to prosecute as this statute required. Where he makes such showing, the court trying the issue is vested with no discretion in the matter. . .”

Since the Ware case, this court has evolved the rule that when interpreting Ark. Stat. Ann. § 43-1708 with reference to a prisoner in jail, the burden is on the State to show that the failure to bring the prisoner to trial was excused but when construing the statute here involving an accused on bail, the burden of proof is on the accused. See Beckwith v. State, 238 Ark. 196, 379 S.W. 2d 19 (1964) and Bell v. State, 243 Ark. 839, 422 S.W. 2d 668 (1968). Even in those cases, however, this court when dealing with an accused admitted to bail has been cautious enough to show that the delay was occasioned on the application of the accused.

Recently the United States Supreme Court has made the Sixth Amendment guarantee of a speedy trial applicable to the States. See Klopfer v. North Carolina, 386 U.S. 213, 18 L. Ed. 2d 1, 87 S. Ct. 988 (1967); Smith v. Hooey, 393 U.S. 374, 21 L. ed. 2d 607, 89 S. Ct. 575 (1969); and Dickey v. Florida, 398 U.S. 30, 26 L. ed. 2d 26, 90 S. Ct. 1564 (1970).

In People v. Minicone, 28 N.Y. 2d 279, 321 N.Y.S. 2d 570 (1971), in considering the constitutional right to a speedy trial it was held that the obligation is on the prosecutor to move promptly and no demand by the accused is required to actuate this obligation. In so stating the court pointed out that the federal courts had been tightening the requirements that criminal prosecutions move expeditiously.

In Glascow v. State, 469 P. 2d 682 (Alaska 1970), the Supreme Court of Alaska came to grips with the issue of a speedy trial and overruled its prior cases to the effect that before a prisoner could invoke the constitutional sanction of a speedy trial he had to be in the position of demanding a trial. In doing so it pointed out that, in view of the many federal decisions to the effect that every reasonable presumption should be indulged against the waiver of a constitutional right, the waiver doctrine on which its prior cases were premised “. . .is of particularly dubious authenticity under present constitutional law.”

For other cases recognizing that a demand for speedy trial or the resisting of a continuance is not a prerequisite to relief under the speedy trial guarantee of the Sixth Amendment to the U. S. Constitution, see Vargas v. State, 252 So. 2d 586 (Fla. 1971), and Jaramillo v. District Court, 484 P. 2d 1219 (Colo. 1971).

In view of the foregoing authorities, we must either take a new look at the plain language of the statute or take up the constitutional issue of whether appellant was denied a right to a speedy trial. Rather than pioneer in the yet undefined area of what constitutes a speedy trial in terms of days or years, we have concluded that appellant here demonstrated her right to a discharge within the plain meaning of our statute when she showed that three terms of court had elapsed since her arrest and that such delay has not “happened on her application.” In so doing we readily recognize that this interpretation is contrary to the language of Stewart v. State, supra, and those cases following it.

Reversed with directions to discharge appellant.

Harris C.J., and Fogleman, J., dissent.

Holt, J., not participating.

John A. Fogleman,

dissenting. Were we construing Ark. Stat. Ann. § 43-1709 (Repl. 1964) for the first time, I would have no quarrel with the result reached by the majority. This section was a part of the Revised Statutes adopted in March 1838. It has survived four changes of constitutions, a complete codification of the code of criminal procedure, one extensive reform of criminal procedure by initiated act and legislative sessions too numerous to count without a word change. While the construction of the words involved in this case was originally made in a case involving the companion statute relating to one held without bail [Ark. Stat. Ann. §. 43-1708 (Repl. 1964)], the holding that the statute means that the defendant must show that he has either demanded trial or resisted postponement has been uniformly recognized and applied since that date.

In Dillard v. State, 65 Ark. 404, 46 S.W. 533, § 43-1709 was invoked in a case in which no steps had been taken during any of seven terms of court. Furthermore, the prosecuting attorney in office prior to the seven terms had told the defendant not to appear because he had agreed to dismiss the. indictment pursuant to a grand jury recommendation. This court said that the Stewart construction applied, and was conclusive, so that there was no error in denying a motion to dismiss under the statute because there was no previous demand for a trial or disposition of the charges. Thus, the same construction that was given to the language of § 43-1708 was given to § 43-1709 as early as 1898. Neither the words of the statute nor the construction had been changed until today.

In Williams v. State, 210 Ark. 402, 196 S.W. 2d 489, we cited and relied upon the language in Stewart approved in Dillard that in order to justify a discharge of the accused on such a motion “he must have placed himself on record in the attitude of demanding a trial, or at least of resisting postponements.” There was not even an attempt to make this showing in this case. In Breedlove v. State, 225 Ark. 170, 280 S.W. 2d 224, we said that the statute is not applicable where the defendant concurs in the delay, citing Stewart, Dillard, Williams, and Fox v. State, 102 Ark. 393, 144 S.W. 516. In Beckwith v. State, 238 Ark. 196, 379 S.W. 2d 19, we emphasized the consistent holding of this court that one on bail must place himself on record as demanding trial or resisting postponement in order to take advantage of the statute.

Our construction of § 43-1709 has become as much a part of the statute as if it were written in it. Merchants’ Transfer & Warehouse Co. v. Gates, 180 Ark. 96, 21 S.W. 2d 406. When a constitutional provision or a statute has been construed and that construction consistently followed for many years, such construction should not be changed. O’Daniel v. The Brunswick Balke Collender Company, 195 Ark. 669, 113 S.W. 2d 717. When a statute meant one thing yesterday it should not mean something entirely different today.

With all due respect, I cannot see how the United States Supreme Court decisions cited by the majority dictate a judicial amendment of the statute. The distinction in Klopfer was clearly pointed out in Givens v. State, 243 Ark. 16, 418 S.W. 2d 629, cert. denied, 390 U.S. 956, 88 S. Ct. 1051, 19 L. Ed. 2d 1149, where Ark. Stat. Ann. § 43-1708 was concerned. Whatever may have compelled judicial action in other jurisdictions should really have no bearing in this instance. Neither should we be concerned about the burden being placed upon the state when the accused is imprisoned and upon the defendant when he is not. See Beckwith v. State, supra. The opportunities for demand and the consequences of delay are so radically different that such variation is easily justified. One on bail is usually well aware of the fact that delay is usually favorable to him. One in prison may not be so aware. In Dillard, we repeated words of Chief Justice Watkins in Stewart, of which we should be particularly conscious today. He said:

We cannot shut our eyes to the fact, known to all who are acquainted with the administration of justice, that, where the crime is of magnitude, delays diminish the chances of conviction and with that hope are usually sought or acquiesced in by the accused.

I submit that no one has found our speedy trial statute, as construed for so long, to be constitutionally deficient. If indeed, judicial amendment of the statute is indicated, it should be prospective by exercise of the rule-making power under Act 470 of .1971 or under the court’s inherent rule-making power, and not by judicial decision reversing a trial court.

I would affirm the judgment of the circuit court.

I am authorized to state that Mr. Chief Justice Harris joins in this dissent.

      If any person indicted for any offense, and committed to prison, shall not be brought to trial before the end of the second term of the court having jurisdiction of the offense, which shall be held after the finding of such indictment, he shall be discharged so far as relates to the offense for which he was committed, unless the delay shall happen on the application of the prisoner.


author: Frank Holt, Justice.

text:
    Willie BRANCH et ux v. STANDARD TITLE COMPANY et al
    5-5912
    480 S.W. 2d 568
    Opinion delivered May 29, 1972

      Shelby R. Blackmon and U. A. Gentry, for appellants.

      Wright, Lindsey & Jennings, for appellees.
   Frank Holt, Justice.

This is an action to recover for the alleged negligent disbursement of escrow funds and to establish subrogation rights. Appellants contracted with Jim Hart for the construction of a residence at a total cost of $16,500. To assist in financing, appellants deeded their property to Hart who obtained a temporary loan for construction purposes from the Pine Bluff National Bank. The appellees were not involved in this loan. Subsequently, appellants applied to appellee-Modern American Mortgage Corporation for permanent financing on their residence and secured a $10,000 loan. This amount was paid to appellee-Standard Title Company with the instruction to disburse the funds after completion of the construction and upon a determination that appellants’ mortgage to Modern American would constitute a first lien; and further, that a title insurance policy be issued to Modern American from appellee-Standard Title Insurance Company, which would indemnify it against any loss by virtue of any prior liens. Thereafter, appellee-Standard Title Company as escrow agent, with appellants’ consent, deducted certain expenses from the principal amount and on November 22, 1968, issued a check for the balance of the loan, $9,037.88, to Hart and M. J. Probst, appellee-Standard Title Co.’s attorney. Probst, acting as agent for appellee-Standard Title Co., paid off the temporary loan at the Pine Bluff Bank. After obtaining an affidavit from Hart, the contractor, that he had paid for all materials and labor used in the construction of the house, Probst remitted the balance to Hart.

A month later, appellants received notice from a materialman, O. L. Puryear and Sons, Inc., that a bill for $2,472.06, representing material furnished in construction of appellants’ house, was unpaid by their contractor. Puryear filed a lien and reduced it to a judgment. Thereafter, appellants filed this action to recover for their payment of Puryear’s judgment alleging that appellees, Standard Title Co. and Standard Title Ins. Co., were negligent in paying to the contractor, who absconded, the balance of the permanent loan proceeds without first ascertaining whether the Puryear material used in the construction of the residence was paid; and, further, that appellants were entitled to be subrogated to the rights of the appellee-mortgagee (Modern American Mortgage Corp.) under the terms of the title insurance policy issued to the mortgagee by appellee-Standard Title Ins. Co.

For reversal of an adverse decree, appellants first contend that the Chancellor erred in holding that appelleeStandard Title Co. was not negligent in disbursing the proceeds of the permanent loan; and also, in refusing to subrogate the appellants to the rights of Modern American (mortgagee) under its title insurance policy issued by appellee-Standard Title Ins. Co. since appellants had to pay the Puryear lien.

Appellant, Willie Branch, testified that he agreed to the payment of the money to Hart and Probst after conferring with a lawyer of his own choice on two separate occasions, “the last of August or the first of September” and in November. Appellant talked with this lawyer after receiving a statement from appellee-Standard Title Company listing certain disbursements or deductions. He testified on cross-examination, “I went to him to ask information on whether if there was any liens, and debts was owed on the property by the contractor [Hart], who would be liable and how we would go about seeing it was paid. It was when I carried the papers to show him, after he brought them down. Yes, that was November 22. The same day I signed them.” On that date, appellant and his wife signed a letter addressed to appellee-Standard Title Company authorizing and directing that the net loan proceeds in its possession as escrow agent be paid by check jointly to Hart and M. J. Probst. Accordingly, a check for $9,037.88 was forwarded to them.

Prior to appellants’ (both Branch and his wife) consultations with an attorney, he had been informed by Puryear during August that the cost of materials used in the construction of the residence had not been paid. Appellant testified: “Well, he told me he had furnished some material out there and he had not been paid. Yes sir, and several others had done the same.” Appellant further testified that in October he had personally paid Hart $7,498.25 without first determining whether Puryear had at any time between August and October received payment for the materials used in the construction of the residence.

We prefer to rest out opinion upon appellees’ assertion that appellants are estopped from asserting their claim. In Rogers v. Hill, 217 Ark. 619, 232 S.W. 2d 443 (1950), we aptly said:

“The doctrine of estoppel in pais was early recognized in decisions of this court and is available as a defense to a claimed right either at law or in equity. See Gambill v. Wilson, 211 Ark. 733, 202 S.W. 2d 185. In the recent case of Williams v. Davis, 211 Ark. 725, at page 731, 202 S.W. 2d 205, 208, we quoted with approval, this statement in Jowers v. Phelphs, 33 Ark. 465: ‘Estoppels in pais depend upon facts, which are rarely in any two cases precisely the same. The principle upon which they are applied is clear and well defined. A party who by his acts, declarations, or admissions, or by failure to act or speak under circumstances where he should do so, either designedly, or with willful disregard of the interests of others, induces or misleads another to conduct or dealings which he would not have entered upon but for this misleading influence, will not be allowed, afterwards, to come in and assert his right, to the detriment of the person so misled.’ ”

As we view the evidence, Branch paid $7,498.25 in cash to his contractor (Hart) and a month later authorized and directed appellee-Standard Title Company, the escrow agent, to pay the net proceeds of the $10,000 loan direct to Hart and Probst with the admitted knowledge of the possible outstanding material bill owed to Puryear without apprising them of his knowledge. These acts arid knowledge are inconsistent with the right presently asserted by appellants and are detrimental to appellees.

As to the appellants’ claim for subrogation, we further observe that appellee-Standard Title Ins. Co.’s duty under the insurance policy was contractual in nature and extended only to the mortgagee. Also, the appellants, as owners of the property, had the primary (and not a secondary) responsibility to discharge the Puryear encumbrance or lien upon their property. Ark. Stat. Annot. § 51-601 (Repl. 1971). The doctrine of subrogation cannot be invoked by appellants in the case at bar.

It follows that it is unnecessary to discuss appellants’ contention that they are entitled to recover their expenses which were incurred in defending the Puryear claim for a lien.

Affirmed.


text:
    THE AUGUSTA CORP., A Division of GRINNELL CORP. v. WOODRUFF ELECTRIC COOPERATIVE CORP.
    5-5902
    480 S.W. 2d 952
    Opinion delivered June 5, 1972

      Pollard, Bethune and Cavaneau, for appellant.

      John D. Eldridge, for appellee.
   Carleton Harris, Chief Justice.

The question in this litigation is whether a certain provision in a contract is ambiguous. On May 25, 1962, Woodruff Electric Cooperative Corporation, appellee herein, and Augusta Corporation, appellant herein, entered into an agreement for electric service. The purpose of the agreement was to supply electricity to be used by the Augusta Corporation for the purpose of melting metal at its manufacturing plant. The contract contained a rate schedule with adjustment rider which set forth the prices for electrical energy furnished thereunder. The basic net monthly rate under the rate schedule was as follows:

“$6.50 for the first 2 KW or less of Demand
$3.10 per KW for the next 8 KW of Demand
$1.55 per KW for the next 40 KW of Demand
$1.25 per KW for all additional KW of Demand
2.5c per KWH for the first 800 KWH
1.6c per KWH for the next 3,200 KWH
0.8c per KWH for the next 11,000 KWH
0.6c per KWH for all additional KWH
MINIMUM:
The Demand Charge for the current month, but not less than $1.25 per KW of the highest Demand established during the 12 months ending with the current month.”

The adjustment rider reads as follows:

“ADJUSTMENT RIDER
Load Factor: Company will make allowances and adjustments in the monthly billings rendered to customer on the basis of monthly load factor to wit:
a. All billings will be adjusted to 1.2c per KWH for the period of this Contract, except
b. In event Customer will operate the plant at a 40% or better load factor, then all billings will be adjusted to 1.0c per KWH, for such period so operated.
c. Load factor is determined by number of hours in a month times actual registered KW demand, divided into number of KWH used.”

In January, 1968, a controversy arose between the parties regarding proper interpretation of the rate schedule and the adjustment rider. Appellant refused to pay the bills submitted by Woodruff, but paid according to its own interpretation of the contract. Thereafter, Woodruff Electric instituted suit in the Woodruff County Circuit Court. After hearing some oral evidence offered by Wood-ruff, the court announced that it was deciding the litigation on the basis of the contract itself, and that such contract was not ambiguous. Upon this announcement, appellant refrained from offering proof. The court held for Woodruff, and from the judgment so entered, Augusta Corporation brings this appeal. For reversal, it is asserted that the trial court erred in holding that the contract rate provisions clearly and unambiguously provide for a minimum charge of one cent per kilowatt hour, and in failing to consider evidence extrinsic to the contract.

At issue is the meaning and effect of the adjustment rider. The cooperative takes the position, which was adopted by the trial court, that the adjustment rider provides for a maximum charge (1.2) per KWH for months when the load factor is less than 40% and that it provides for a minimum charge (1.0) per KWH when the load factor exceeds 40%. Appellant agrees that the rider provides a maximum of 1.2 per KWH for months where the load factor is not 40%, but contends that the rider provides a second maximum charge (1.0) for months when the load factor exceeds 40%. In other words, Augusta Corporation contends that provisions in the rider favor it in each instance.

A discussion of the case in conference made it clear that the provisions are ambiguous since various views were expressed, and we so hold. If appellee is correct, it is difficult to see why a rate schedule is set out at all, since the provisions of that schedule (heretofore set out) would be superseded by the adjustment rider, and all charges would be either 1.2 per KWH or 1.0 per KWH, depending on the load factor. The other rates would never be used. Actually, as far as charges per KWH are concerned, appellee agrees that this is correct.

On the other hand, when the adjustment rider alone is read, it can be interpreted just as easily under the view of appellee. It will be noted that the language in the rider commences “Company will make allowances and adjustments in the monthly billings rendered to customer' on the basis of monthly load factor***”. Appellee states in its brief:

“The^appellant seems to be contending that ‘adjustment,’ as used in the rider, means only a reduction, i.e., to 1.2c per KWH if the load factor is less than 40% and to lc per KWH if the load factor is more than 40% and if the rates as set forth in the net monthly rates produce a figure between 1.0c and 1.2c. It argues that if the billing, applying the net rates, results in a figure of less than lc per KWH it could never be adjusted upward to lc. In other words, that the adjustment rider can only be applied to benefit the customer and never as a protection to the utility. It is submitted that this is a strained, unnatural and inequitable construction to put upon this language and is not justified by the plain meaning of the words. It is significant that the Appellant never quotes the fact that the Company will make not only adjustments but ‘allowances’ in connection with the monthly billings to consumer on the basis of its monthly load factor. The word ‘allowances’ obviously refers to the right of the customer to have a reduction either to 1.2c per KWH or lc per KWH, depending upon its monthly load factor. That is the very meaning of the word ‘allowance’. G 8c C Merriam Webster Unabridged Dictionary gives the following pertinent definitions of the noun ‘Allowance’:
‘Act of allowing, granting, conceding or admitting; a share or portion allotted or granted; a sum granted as reimbursement or bounty; abatement.’
In none of the definitions of the word ‘allowance’ is there any aspect of an increase.”

Since, under appellant’s view, hereafter set out, it does not appear that the word “allowance” was essential, it may be that there is merit in the above argument advanced by appellee; i.e., the word was used as a matter of setting forth the rights of appellant, while the word “adjustment” was used to set forth the rights of appellee. However, this is not entirely clear.

It is then pointed out that the word “adjustment” can mean either a reduction or an increase and this is correct. In fact, in Broadway-Main Street Bridge District v. Mortgage Loan and Insurance Agency, Inc., 195 Ark. 390, 112 S.W. 2d 648, this court pointed out, in referring to an annual adjustment of assessments of benefits to be made by assessors that the total amount of the assessment could be increased or diminished.

Appellant’s argument is presented in its brief as follows:

“The phrase at the heart of this question of interpretation is ‘will be adjusted to’. The term ‘adjustment’ admittedly can mean change in either direction, but one of the definitions given it by Webster, New World Dictionary of the American Language (2nd College Ed. 1970) is ‘a lowering of price, as of damaged or soiled goods.’
It is essential to note that the phrase ‘will be adjusted to’ is used for both the situation where the load factor does not equal 40% (paragraph a. of the rider) and that where it does (paragraph b. of the rider). Where a certain term is used twice in the same writing it will ordinarily be deemed to have been used in the same sense each time. 17 Am. Jur. 2d, Contracts § 247 (1964). If this phrase sets a maximum as held by the court below, of 1.2c per KWH when load factor is less than 40%, should it not then set a maximum of 1.0c when the load factor exceeds 40%?”

Appellant further argues that Woodruff Electric is left with the choice or arguing an inconsistent interpretation of the discussed rider or arguing for a construction which would completely nullify the rate schedule, a part of the contract.

Frankly, it appears that either interpretation could be reached, and we have held that where a contract is susceptible of two different interpretations, it is ambiguous, and where two such interpretations may be urged with plausibility, the ambiguity is apparent. Lutterloh v. Patterson, 211 Ark. 814, 202 S.W. 2d 767. This finding means that parol evidence is admissible. We have said, “Evidence which tends to show the intention of the parties and does not contradict or vary the terms of the written instrument is admissible for the purpose of showing the real meaning of the words used in the instrument and the intention of the parties”. Sternberg v. Snow King Baking Powder Company, Inc., 186 Ark. 1161, 57 S.W. 2d 1057.

In accordance with what has been said, the judgment is reversed, and the cause remanded to the Woodruff County Circuit Court.

It is so ordered.

      The contract contains other provisions, such as availability, application, type of service, time for payment, and the period covered by the contract.


text:
    Leon SATTERFIELD v. STATE of Arkansas
    5717
    483 S.W. 2d 171
    Opinion delivered June 5, 1972

      Bon McCourtney ir Associates by: Troy L. Henry, for appellant.

      Ray Thornton, Atty. Gen., by: John D. Bridgnorth, Asst. Atty. Gen., for appellee.
   George Rose Smith, Justice.

Upon a charge of having burned a bam the appellant was convicted of arson and sentenced to imprisonment for one year. The facts are stated in our opinions upon two earlier appeals and need not be repeated. 245 Ark. 337, 432 S.W. 2d 472 (1968); 248 Ark. 395, 451 S.W. 2d 730 (1970). The appellant’s present points for reversal have to do with the selection of the jury, the admissibility of evidence, and the court’s instructions.

Juror Collins at first stated that he had an opinion about the case and that it might take evidence to remove it. He did not recall any particular item of evidence, but he had “a vague remembrance of hearing about the case and possibly hearing a portion of the testimony.” Upon further interrogation and explanation by the court, however, Collins stated that he understood his position better and that he could lay aside whatever opinion he had and try the case upon the evidence and the court’s instructions. We find no error in the court’s acceptance of the juror. The appellant had the burden of showing, by means of the voir dire examination, that Collins was subject to a challenge for cause. That burden was not met. It was not positively shown that Collins had firsthand knowledge of the facts or that he had actually heard any testimony at an earlier trial. Here the facts are materially different from those in Glover v. State, 248 Ark. 1260, 455 S.W. 2d 670 (1970), for there the jurors ended the interrogation by stating that it would take evidence to remove their opinion. Here just the opposite is true. We do not see that Act 568 of 1969, which provides that no person shall serve as a juror who has formed or expressed an opinion “which may influence his judgment,” made any substantial change in our law. Ark. Stat. Ann. § 39-105 (c) (Supp. 1971). Whether the venireman’s opinion may influence his judgment is still a matter to be determined by the trial judge.

Later on the court excused a prospective juror whose brother was married to an aunt of the accused. Even if the court was in error in finding the juror to be disqualified, no prejudice appears. “Since a party is not entitled to have any particular juror, the erroneous rejection of a competent talesman is not prejudicial, in the absence of a showing that some biased or incompetent juror was thrust upon him.” Lewis v. Phillips, 223 Ark. 380, 266 S.W. 2d 68 (1954). That showing is not made in the case at bar.

The court did not err in allowing a witness to testify that one of the accused’s companions had said that there was hay in the barn. The question was asked in order to show what Satterfield’s response had been. Moreover, the presence of the hay was shown by other proof and in fact was not disputed. Nor do we perceive how the accused could have been prejudiced by the court’s action in allowing the prosecuting attorney to remind a witness that he had tried to persuade the witness to return to the scene of the fire to make notes or measurements.

The appellant contends that the court should not have allowed the witness Ross to testify that he and Satterfield had been riding around together and drinking beer or malt liquor during the afternoon before the barn was burned that same night. The testimony was not offered to prove that the accused had committed another crime; that is, drunken driving. In fact, the witness did not say that Satterfield had been drunk. We think the testimony to have been a permissible background to Ross’s further testimony that he went to the scene of the fire that night and saw Satterfield there.

With respect to the instructions, the court was right in refusing to give the accused’s Instruction 5, defining an accessory after the fact. A mere passive failure to disclose the commission of a crime does not make a person an accessory after the fact. Fields v. State, 213 Ark. 899, 214 S.W. 2d 230 (1948). Inasmuch as nothing more than such a passive failure was shown, the proffered instruction was abstract and would have been confusing to the jury. We have studied the court’s instructions with reference to the definition of accomplices and the weight to be given their testimony and find nothing that can be said to have been prejudicial to the accused.

Affirmed.


author: Lyle Brown, Justice.

text:
    HOME MUTUAL FIRE INS. CO. v. Edward N. RILEY
    5-5894
    480 S.W. 2d 957
    Opinion delivered June 5, 1972

      East & Storey, for appellant.

      Thomas B. Tinnon Professional Association by: John A. Crain, for appellee.
   Lyle Brown, Justice.

Appellant Home Mutual Fire Insurance Company denied liability under a fire policy by virtue of a nonoccupancy clause. The appellee, insured, was awarded judgment, apparently on the grounds of waiver and estoppel. The principal point for reversal is that the court erred in refusing to grant appellant’s motion for a directed verdict.

Appellee is a veterinarian in Mountain Home and he owned a rent house which was next door to his clinic. Home Mutual insured the house against loss by fire in the amount of $3,500. One of the standard provisions in the policy was that there would be no liability for loss if the described property remained unoccupied for a period beyond thirty days. The tenant moved from the house on May 29, 1970, and the house burned on July 3, or thirty-four days after being vacated.

Some events transpired in June which give rise to appellee’s claim of waiver. In early June 1970, Dr. Riley moved some x-ray equipment into the house, anticipating that he would use the house henceforth as a part of his clinic. On or about June 14 Dr. Riley made known to appellant’s local agent in Mountain Home that he wanted to insure the equipment in the sum of $3,000. Dessie Pitts, the local agent, addressed a memorandum to appellant’s Paul Peevy at the home office in Springdale:

Please issue endorsement to the above captioned policy adding the following: $3,000 on x-ray equipment. Dr. Riley has moved his tenant out of this house and it is adjacent to his clinic and he needs $3,000 on the x-ray equipment he has in the house. The house will be used as a part of his clinic now if you need to re-rate this.

Paul Peevy replied under date of June 26 that Home Mutual would not be able to furnish the desired coverage on the x-ray equipment. Dessie Pitts notified Dr. Riley, appellee, of the decision of the home office. She was instructed to get the coverage on the machinery from some other company and, if necessary, to transfer the existing insurance on the building to the company which issued the machinery insurance. Mrs. Pitts was in the process of carrying out those instructions when a family emergency arose that required her presence in Fayetteville. Before she was able to procure the needed insurance, the house burned. The house and contents were a total loss.

Mrs. Pitts testified that, being in charge of a general insurance agency at Mountain Home, she was agent for Home Mutual and also a general agent for them. “I did have authority to bind the company. I have always had it, - - -binding authority. Mr. Peevy advised me of my authority.” She testified that when she received notice from Home Mutual that coverage on the machinery was denied, she got in touch with appellee. “I told him that he had insurance on the building, period, but that they denied it on the equipment.” That was only a matter of days before the house burned.

Paul Peevy, president of Home Mutual, testified that upon receipt of proof of loss of the fire he went to Mountain Home. He admitted that he told appellee he would be in receipt of a check in about two weeks. However, he said further conversation revealed that the house had been vacant for more than thirty days and that is when I decided that I had better look into it.”

The nonoccupancy clause, being for the benefit of the insurer, may be waived by it. Aetna Life Ins. Co. v. Duncan, 165 Ark. 395, 264 S.W. 835 (1924); Webster v. Telle, 176 Ark. 1149, 6 S.W. 2d 28 (1928); Bank Credit Life Ins. Co. v. Pine Bluff Nat. Bank, 247 Ark. 922, 448 S.W. 2d 333 (1969).

This court will grasp any circumstances which indicate an election to waive a forfeiture. In American Life Ass’n. v. Veden, 164 Ark. 75, 261 S.W. 320 (1924), we said:

The doctrine is firmly established by the highest courts in this country, and approved by us in numerous cases, that “forfeitures are not favored in law,” and that “courts are always prompt to seize hold of any circumstances that indicate an election to waive a forfeiture, or an agreement to do so, on which the party has relied and acted. Any agreement, declaration, or course of action on the part of an insurance company which leads a party insured honestly to believe that, by conformity thereto, a forfeiture of his policy will not be incurred, followed by due conformity on his part, will estop, and ought to estop, the company from insisting on a forfeiture, though it might be claimed under the express terms of the contract.”

To the same effect see Service Fire Ins. Co. v. Payne, 218 Ark. 499, 236 S.W. 2d 1020 (1951). Approaching the facts and circumstances in the case at bar in the light of Veden and Payne we cannot say there was no substantial evidence of waiver and estoppel. Perhaps no single act, standing alone, justifies that conclusion; however, when totality of activities is viewed in a light most favorable to the verdict, we think our conclusion is proper. The factors which point to waiver and estoppel are these:

(1) In the June 14 memo, Dessie Pitts to Paul Peevy it was pointed out that “Dr. Riley has moved his tenan out of this house. . .” In his reply Mr. Peevy made nc mention of the nonoccupancy requirement, notwithstanding his admission on cross-examination that “the occupancy clause occurred to me.”

(2) When Dessie Pitts notified Dr. Riley that his application for insurance on the machinery had been declined, she assured him he still had coverage on the residence. At that very moment the house had been vacant for a period very close to thirty days. Again there was no mention of the nonoccupancy clause.

(3) When Mr. Peevy interviewed appellee at Mountain Home incident to the fire, Peevy advised appellee that he would receive a check within some two weeks. Peevy said that after he made that statement the insured mentioned that the house had been vacant. Peevy said that statement raised in his mind the question of possible forfeiture, yet Peevy made no mention of a possible forfeiture to the insured.

(4) The premium on the insurance policy was paid up until May 1, 1971. If the company desired to forfeit the policy for nonoccupancy the insured was entitled to a remittance of some ten months unearned premium. Yet we are unable to find in the record any evidence of a refund under the policy at issue; nor is there any record of tender.

Appellant advances one other point for reversal. At the trial appellant asked that the witnesses be placed under the rule. At the same time appellant requested that the official of the insurer be relieved from the rule in order to assist counsel in the trial of the case. The court denied that request because counsel for appellee refused to agree to the exception. There was no error in the court’s ruling. In the first place appellant points to no prejudice that resulted from excluding the official. In the second place, whether an exception to the exclusion is granted rests within the sound discretion of the trial court. Randolph v. McCain, 34 Ark. 696 (1879). See St. Louis I.M. & S. Ry. v. Pate, 90 Ark. 135, 118 S.W. 260(1909).

Affirmed.