text:
    Bell Transportation Company v. Orville Morehead
    5-4775
    437 S.W. 2d 234
    Opinion Delivered February 17, 1969

      William II. Drew and Wright, Lindsey & Jennings for appellant.

      8am Robinson and McMath, Leatherman, Woods & Youngdcihl for appellee.
   Conley Byrd, Justice.

Appellee Orville Morehead was awarded a $165,000 judgment upon a jury verdict against appellant Bell Transportation Company for injuries sustained in connection with the use of Bell’s tandem truck and lowboy. Since the asserted liability against Bell must rest upon the doctrine of respondeat superior, Bell contends that it was entitled to a directed verdict on the ground that its regular driver Sebastian Carrior and its supervisor J. C. Melton were borrowed servants in the employ of Houston Contracting Co. at the time of Morehead’s injury.

The record shows that Houston Contracting Co. was involved in a “change out” of engines at Tennessee Gas Transmission Co. compressor stations. The engines had been removed from their foundations, sent back to the factory to be reworked and then brought back to be reinstalled in the compressor stations. The engines were moved in halves. Bach half weighed about 80 tons. Bell is engaged in heavy hauling in Louisiana and 21 other states. It operates under an Interstate Commerce Commission permit. Bor deliveries, Bell charges the regular tariff prescribed by ICC regulations. The bill of lading signed by Houston called for Bell to, “furnish one tandem truck and one 16 wheel lowboy and one supervisor to work as instructed”. The truck and lowboy was driven by one Sebastian Carrior to a railroad siding, accompanied by J. C. Melton, Bell’s supervisor, in another vehicle. There, the Houston Contracting Co. moved the half motor from a flat car to the lowboy, which Sebastian Carrior drove to the compressor station. In the course of attempting to back the lowboy up a ramp to the platform at the compressor station onto which the half motor was to be unloaded, the drive shaft on Bell’s truck broke, making it impossible to move the rig under its own power. A cable from a winch truck was tied to the lowboy through a block and tackle arrangement and the lowboy was winched to wiihiu a few feet of the platform. The winch truck was operated by Danny Williams, an employee of Houston, and signals were given him by J. E. Morehead, Houston’s assistant superintendent. Signals and orders to the truck driver, Carrior, were relayed by J. C. Melton, Bell’s supervisor. When the truck had been winched to within 4 or 5 feet of the platform, it was discovered that the cable was fouling against the platform causing a loss of power. In order to accomplish a higher hitch on the lowboy it was necessary to secure slack on the cable. The winch truck operator begin io roll off cable from his drum and appellee Morehead was instructed to pick up the cable to gather up the slack. While appellee Morehead was so engaged, Sebastian Carrior permitted the truck to roll forward. The cable in Morehead’s hands was immediately stretched taut, flinging him against the platform and inflicting the injuries complained of.

Sebastian Carrior had been Bell’s employee for 15 years. He testified that during the winching operation, he sat under the wheel of the truck to steer and brake when necessary, that the flagman who signaled him to put on his brakes was Mr. Melton, Bell’s supervisor and his immediate superior. He said that when he left Bell’s office on the morning of the accident, he knew where he was going. They told him to go to Port Sulphur and pick up^ the engine at the railroad siding and move it to the building where it could be unloaded into the building. Mr. Melton went along as his supervisor to see that he hauled it in the proper manner.

Mr. J. C. Melton testified that after the truck would not operate under its own power, Mr. Edwards, Houston’s job superintendent, Mr. J. E. Morehead, Houston’s assistant job superintendent and appellee’s brother, Houston’s millwright foreman and he were all talking and trying to figure out some means of winching the lowboy back into the building. The winch truck and a D8 tractor were hooked up to the trailer. He was standing' at the left front door of the truck flagging it. Mr. J. E. Morehead was standing on the platform where he could see him for purposes of signalling. He was taking orders from Mr. Jesse Morehead. Appellee More-head was hurt when they let the truck roll ahead approximately 3 or 4 feet on a signal from Jesse Morehead. He said that at all times after the driveshaft broke he was taking orders from Jesse Morehead. On cross examination Mr. Melton stated that the tandem truck and lowboy could cost as much as $50,000 and that he was sent along as supervisor to help protect that equipment. They couldn’t turn special equipment like that over to just anybody to use as they might see fit. He actually supervised the transporting of the equipment from the railroad track to the pumping station. That was his and Bell’s business there and he hadn’t worked for anybody but Bell Transportation Company. Mr. Bill Edwards was superintendent for Houston Contractors and J. E. Morehead was assistant superintendent. He was taking his orders from Mr. J. E. Morehead.

Mr. William R. Edwards, a witness for Bell, testified that J. E. Morehead was directing the movement of the trucks and the entire operation from the platform outside the building; that the Bell truck was under the direction of Houston Contracting Co. from the time it arrived until it left and that he represented Houston and directed the truck in its use. That Mr. Melton who was with Bell was under Ms supervision and control and Houston was responsible for moving the engines and installing them. Later, however, Mr. Edwards testified that he told the truck driver and supervisor where to go with the truck to get the machinery and where to take the machinery. That Bell had the people, experience and equipment to do the job and that Mr. Melton was in charge of the truck — he was there to see that the truck was operated in the proper manner. The charge for the use of the truck was on an hourly basis in. accordance with the ICC tariff. He didn’t attempt to give the track driver or Mr. Melton, the supervisor, any orders or tell them anything about the details of the work. Mr. J. E. Morehead was supervising the operation, but he didn’t attempt to give these fellows any orders. They were hired to come down there and move that engine from the rail point to the compressor station. They never did get it back to the platform where it could be unloaded before appellee Morehead was injured.

Since this accident occurred in Louisiana, we must apply our procedural law and the substantive law of Louisiana. Of course under our procedural law, we need only look to see if there was sufficient evidence to go to the jury. The substantive law of Louisiana on the borrowed servant doctrine is extensively set forth in Benoit v. Hunt Tool Co., 219 La. 380, 53 So. 2d 137 (1951).

The Supreme Court of Louisiana in the Benoit case discussed the usual tests for determining the borrowed servant doctrine — i.e., “whose business” test and the “control” test. In applying these tests the court there recognized that if there was a division of control between the employer lending the servant and the employer borrowing the servant, the borrowed servant doctrine could not apply. From the testimony of Bell’s witnesses set out above, we find that there was substantial evidence from which the jury could have found that Bell’s employees were conducting themselves in pursuance of their master’s business and under their master’s control — more particularly that control as to the protective custody of their master’s equipment. Bell takes the position that the only way the winching operation could be done properly was for someone to direct and control all phases of the operation and that the evidence conclusively shows that this control was under the supervision of Houston Contracting’ Co. This argument fails to take into consideration the distinction between the authoritative direction and control involved in the master-servant relationship and that direction with which one necessarily cooperates in executing a common plan for a larger undertaking. To the same effect see The Standard Oil Co. v. Anderson 212 U.S. 215, 29 S. Ct. 252, 53 L. Ed. 480 (1909).

Bell’s second point for reversal is that the trial court erred in giving its instruction No. 11 (AMI 702). This instruction reads as follows:

“I have used the term ‘scope of employment’ in these instructions.
“An employee is acting within the scope of his employment if he is engaged in the transaction of business which has been assigned to him by his employer or if he is doing anything which may reasonably be said to have been contemplated as a part of his employment and is in furtherance of his employer’s interests”.

Bell’s third point for reversal is that the court erred in giving its instruction No. 12 (AMI 703). This instruction reads:

“The vehicle driven by Sebastian Carrior was owned by Bell Transportation Company, and Sebastian Carrior was a regular employee of Bell Transportation Company. You may consider these facts along with any other evidence in the case in deciding whether Sebastian Carrior was acting as an employee of Bell Transportation Company and within the scope of his employment at the time of the occurrence”.

In its brief Bell argues these two instructions together. It contends that each was abstract, improper and highly prejudicial and that taken together the two instructions prevented Bell from having the borrowed servant defense considered fairly by the jury. To fortify its position Boll points out that the trial court upon Bell’s request instructed the jury as follows:

“As the general employer of J. C. Melton and Sebastian Carrior, Bell Transportation Company has the burden of proving by a preponderance of the evidence that, as to the particular work in question, the relationship of master and. servant between Bell Transportation Company and its employees had been suspended and that a new relationship of master and servant had been created between them and Houston Contracting Company, which gave Houston Contracting Company the right to control them, with right of control being relinquished by Bell Transportation4' Company. ’ ’

We find Bell’s position to be without merit. Appellee Morehead’s theory of the lawsuit at all times was that J. C. Melton and Sebastian Carrior were employees of Bell and at all times acting within the scope of their employment for Bell. Thus, even under Bell’s defense on borrowed servant, Morehead was still entitled to have his theory of the lawsuit explained to the jury together with the indicia or guides by which the jury could determine whether Melton and Carrior were acting within the scope of their employment for Bell or had suspended the same for a new relationship with Houston. We find nothing in the instructions that is abstract or conflicting with the borrowed servant doctrine.

Bell’s last argument is that the verdict is excessive. The record shows that Morehead had an annual earning capacity in excess of $14,000 per year with a life expectancy of 24.41 years from date of trial. Some 17 months had elapsed from injury to the date of trial. He was in the hospital a total of 34 days, was bedfast for more than 60 days and in addition to a permanent back injury, suffered a hernia, for which he underwent an operation. His medical expenses to the date of trial were $2,742. There was testimony that Morehead in the future would have to undergo a back operation resulting in additional medical expenses of $2,400. Bell’s doctor, who examined Morehead for purposes of trial, gave Morehead a 35% disability to the body as a whole and iii addition theorized that in terms of occupational disability, Morehead could well be described as totally disabled.

We believe that there was substantial evidence from which the jury could find that appellee Morehead was totally and permanently disabled from an injury which would cause him additional pain in the future. Upon the record we are unwilling to say that the verdict in the amount of $165,000 was excessive.

Affirmed.


source: Caselaw Access Project

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

license: Public Domain

text:
    Carrie Tucker, et al v. Edyth L. Walker
    5-4801
    437 S.W. 2d 788
    Opinion Delivered February 17, 1969
    [Rehearing denied March 24, 1969.]

      Murphy & Arnold for appellants.

      Sullivan & Causbie for appellee.
   Conley Byrd, Justice.

The trial court held that a 1905 deed from Samuel J. and Molly Walker to Samuel J. Walker Jr. created a fee tail estate— i.e., a life estate in Samuel J. Walker Jr., with a contingent remainder to the heirs of his body. Based upon such finding, it awarded possession of the lands here involved to appellee, Edyth L. Walker; awarded betterments to appellants Carrie Tucker, Iris ITeasley and Jim Fuhr in the amount of $2500, and betterments to A. W. Hill, W. A. Hill, Mrs. Gus Lewis, Charles Walter Hill, Mary Jo Hill Christensen, Barbara Hill Carter, and Linda Sue Hill McDuff ey in the amount of $2200; and denied damages for breach of covenant against appellee, Etna Walker, the wife of Samuel J. Walker Jr., Helen Walker Blaney and Edyth L. Walker as a guardian of Merle E. Walker. The appellants, Carrie Tucker, et al, and A. W. Hill, et al, appeal. For reversal they relied upon the following points:

I. If appellants be dispossessed in this case then damages should be allowed for breach of warranty.

II. The deed from Samuel J. Walker, Sr., et us, to Samuel J. Walker, Jr., considered with the “attendant” circumstances, should be interpreted as creating a. fee simple and not a fee tail; or, alternatively, the deed should be reformed to create a fee simple which was obviously intended by all parties.

III. Applying the rule of the destructibility of contingent remainders, Walker, Jr., had a fee simple.

Appellee Ed$th L. Walker cross appeals contending that the improvements placed on both tracts of land were not in good faith and that the court erred in its valuation of improvements.

The record shows the deed dated June 5, 1905, recites, “that we, Samuel J. Walker and Molly I. Walker, his wife, for and in consideration of $1,000 into our hands this date paid, do hereby grant, bargain, sell and convey unto the said Samuel J., Walker Jr. and unto his bodily heirs and assigns forever, the following lands lying in the County of Sharp and State of Arkansas, to-wit:...”

The habendum clause reads, “To have and to hold the same unto the said Samuel J. Walker Jr. and unto his heirs and assigns forever, with all appurtenances thereunto belonging”. This deed was prepared by James Davie, a newly appointed Justice of the Peace. The record shows he used a form and filled in the blanks by hand. Mr. Davie was a farmer and carpenter in the area.

In 1912, Walker Jr. and Etna Walker, his wife, conveyed the lands here involved to S. B. Turner by a general warranty deed. Walker thereafter moved to Oklahoma where he died in 1961. At the time of his death he owned, as an estate by the entirety with his wife, real estate valued at $4500. He was survived by Etna and two children, Helen Walker Blaney and Merle E. Walker. Before this suit was filed Helen sold her interest to Merle. Merle was incompetent and his wife Edytli was appointed his guardian.

Under the third point, appellants suggest that we should limit or curtail fee tail estates by applying the rule of destructibility of contingent remainders. We find no merit in this argument as applied to the facts here. By Ark. Stat. Ann. § 50-405 (1947) and §§ 50-405.1 — 50-405.3 (Supp. 1967), the Legislature has undertaken not only to regulate the fee tail estate but also to provide a method for its dissolution. We see no reason why the court should go beyond established public policy.

Under point II, appellants argue that the 1905 deed to Samuel J. Walker Jr. created a fee simple title in Walker. In the case of Weatherly v. Purcell, 217 Ark. 908, 234 S.W. 2d 32 (1950), we had before us a conveyance to “John E. Purcell and his bodily heirs”. The habendum clause there read, “To have and to hold the aforegranted premises to the said John E. Purcell and his heirs aforesaid in fee simple forever.” We held that the deed created a fee tail estate. We think this decision is controlling of the issue involved here.

Under the second point appellants also argue that if the deed created a fee tail then it should be reformed to create a fee simple which was obviously intended by all the parties. The only proof offered with reference to reformation of the deed was that the Justice of the Peace who drew the deed was a farmer and carpenter by trade; not admitted to practice law; and newly appointed as a Justice of the Peace. The only other evidence was that neither Samuel J. Walker Jr. nor his father were lawyers. We find this ¡evidence insufficient to reform a deed executed by the parties. Furthermore the testimony of Cleo Chaplin, a nephew of Samuel J. Walker Jr., shows that his grandfather gave properties to all three of his children including Samuel Walker Jr., so that theA" couldn’t sell their dowry.

Appellants’ cross complaint against Etna Walker, the wife of Samuel J. Walker., is upon the theory that she covenanted with S. P. Turner to warrant and defend the title against all claims whatsoever. Their action against Helen Walker Blaney and Edyth L. Walker as guardian of Merle E. Walker is on the theory that as heirs of Samuel J. Walker Jr. and Etna Walker they have received property of their parents which could be used to satisfy the damages caused by the breach of their ancestors’ covenant of warranty, see Jones v. Franklin, 30 Ark. 631 (1875).

The trial court was correct in holding that Helen and Merle Walker were not liable to the appellants for ■either one of two reasons. In the first place the record fails to show that either has received by inheritance any property either from Samuel J. Walker Jr. or their mother Etna 'Walker. The record only shows that Etna Walker died after the institution of these proceedings; that at the time of her death she owned property inventoried at a value of $1,500; and that she, by will, left the property to Helen. Of course until such time as the Oklahoma statute of non-claims has run, there is no way to determine whether Helen will receive any property from her mother. There is no showing that Merle "Walker received any property from either his father or mother.

Etna Walker, the wife of Samuel Walker Jr., argues tliat she is not liable on the warranty because she only purported to waive her dowry in the deed and that under the existing law of 1905 such a contract by a married woman was void. The latter contention is made upon the authority of Benton County v. Rutherford, 33 Ark. 640 (1878). As we read our cases Sparks v. Moore, 66 Ark. 437, 56 S.W. 1064 (1908) and Longino v. Smith, 158 Ark. 162, 249 S.W. 557 (1923), married women became liable upon their contracts, including covenants of warranty, by the passage of Act 47 of 1895. This act is now codified as Ark. Stat. Ann. § 55-405 (1947). Furthermore our cases hold that a married woman joined, as a grantor with her husband in a deed is liable on the covenant of warranty contained therein, Spann v. Langston-Williams Lumber Co. 184 Ark. 99, 40 S.W. 2d 791 (1931).

Recovery in such cases is limited to the purchase price, interest from the date of eviction, attorney’s fees and court costs, Wade v. Texarkana Building & Loan Association, 150 Ark. 99, 233 S.W. 937 (1921); Fox v. Pinson, 182 Ark. 936, 34 S.W. 2d 459 (1930). Also where the land to which the covenant runs has been divided among other grantees, the damages suffered by each subsequent grantee is to be prorated according to value, Lane v. Stitt, 143 Ark. 27, 219 S.W. 340 (1920). Therefore we hold that the trial court erred in not awarding damages against Etna Walker’s estate since there was ample testimony showing the value of each of the two parcels carved out of the original covenanted land.

Appellees’ contention on a cross appeal that the betterments to the lands were not made in good faith is not sustained by the record. The only evidence to indicate any lack of good faith is that the original deed from Samuel Walker and his wife Molly Walker to Samuel Walker Jr. was at all times in the possession of Carrie Tucker. There is ample other evidence to the effect that Carrie Tucker had no actual knowledge of the provision in the deed until'sometime in the 1950’s.

Neither do we find any merit in the contentions that the court erred in its valuation of the improvements. Eugene Street valued the improvements on the Tucker farm at $2500 to $3000, on the Hill farm $3000 to $3500. Witness Boyd Carpenter valued the Tucker farm improvements at $3000 and the Hill farm improvements at $3000. Wre hold this testimony amply sufficient to sustain the trial court’s assessment of betterments, after deductions for rents, in the amount of $2500 to the Tucker farm and $2200 to the Hill farm.

Here the damages suffered by the appellants greatly exceed the $8,000 purchase - price stated in the warranty deed from Walker Jr. and his wife Etna. We remand the ease as against the estate of Etna Walker, only, to the trial court for purpose of prorating the $8,-000 limit on Etna’s liability between appellants Carrie Tucker, et al, and A. W. Hill, et al, together with court costs, reasonable attorney’s fee and interest from date of eviction.

Affirmed in part and reversed in part.

Justice Fogleman concurs.

John A. Fogleman, Justice.

I concur in the majority opinion. Yet there is one important portion treated therein about which I am uncertain. That is the basis for disposition of point three, having to do with the doctrine of destructibility of contingent remainders. 1 cannot tell Avhether the majority is rejecting or approving the doctrine. The opinion does not relate the particular facts Avhich make 'the doctrine inapplicable.

Samuel P. Walker had one son and two daughters, one of Avhom died wdthout issue. After his conveyance to Samuel P. Walker, Jr., but before the latter’s deed to Turner, the senior Walker died and no administration Avas had upon his estate. It seems that the reversion in the property in question would have then vested in his surviving children. We do not know when the daughter having no issue died, so it is possible that the reversion in an undivided one-half passed to the grantees in the deed from Walker, Jr. under the after-acquired title statute. To the extent that the reversion passed to Turner, there was a merger which would have destroyed any contingent remainder pro tanto, under the rule.

I agree that the conveyance by Samuel J. Walker, Jr., the life tenant, could not operate to effect a destruction of the contingent remainder. A conveyance by a life tenant to a third party is not a surrender of the life estate. See Le Sieur v. Spikes, 117 Ark. 366, 175 S.W. 413, Pierce v. Lowe, 221 Ark. 796, 256 S.W. 2d 43; Weatherly v. Purcell, 217 Ark. 908, 234 S.W. 2d 32. Furthermore, the surrender by a life tenant necessary for a destruction of the contingent remainder must be made to the owner of the next vested estate rather than to a stranger to the title. Rogers v. Ogburn, 116 Ark. 233, 172 S.W. 867; Hayes v. Goldman, 71 Ark. 251, 72 S.W. 563; Gray v. Shinn, 293 Ill. 573, 127 N.E. 755, (1920); 31 C.J.S. Estate § 93.

Under the rule a contingent remainder must vest, if at all, at the termination of its supporting freehold estate. Simes & Smith, Law of Future Interest, 2d Ed. § 193 (p. 216); Gray v. Shinn, supra; Moynihan, Survey of Real Property, § 7; 31 C.J.S. Estates § 91. This termination may be accomplished by merger of separate vested interests in one owner. Simes and Smith, Law of Future Interest, supra; Rogers v. Ogburn, supra. A life estate is a vested interest. Ark. Stat. Ann. § 50-405 (3947); Black v. Webb, 72 Ark. 336, 80 S.W. 367. The reversion is also a vested interest. See Wilson v. Pharris, 203 Ark. 614, 158 S.W. 2d 274, Davis v. Davis, 219 Ark. 623, 243 S.W. 2d 739. The merger of the life estate and the reversion would destroy the contingent remainder. Bennett v. Morris, 5 Rawl. 8 (Pa. 1835): Blocker v. Blocker, 103 Fla. 285, 137 So. 249 (1931); Simes and Smith, Law of Futme Interest, 2d Ed. § 197 (p. 216); Gray v. Shinn, supra.

The doctrine and its applicability in Arkansas have been treated in an extensive Law Review article by Professor Samuel F. Fetters, 21 Ark. L. B. 145. While he takes the position that this court has never expressly held the doctrine applicable or inapplicable, yet he calls attention to the decisions in a number of cases in which the result would not have been possible if the doctrine had been applied. Lathrop v. Sandlin, 223 Ark. 774, 268 S.W. 2d 606; Dyer v. Lane, 202 Ark. 571, 151 S.W. 2d 678; Davis v. Davis, 219 Ark. 623, 243 S.W. 2d 739. While the issue may not have been raised in these eases, it seems that the court might well have applied the doctrine in some of them if it were the rule in Arkansas.

Although the common law was adopted by Ark. Stat. Ann. § 1-101 (Repl. 1956), a provision was made for alteration of common law rules by the General Assembly. As suggested by Professor Fetters, Act 163 of 1957, Ark. Stat. Ann. § 50-405.1, et. seq. (Supp. 1967) is wholly inconsistent with the existence of the common law rule of destructibility of contingent remainders. This act provides for the dissolution of an estate existing by reason of a conveyance to a grantee and the heirs of his body. The method of dissolution prescribed is a conveyance of the fee by the creator of the life estate, all life tenants and all living persons who might be remaindermen in event of the death of the life tenant. If the doctrine of destructibility were applied, with its provision for destruction by merger, there would be no necessity for the statute. The grantor might dissolve the estates created simply by conveying his reversion to the holder of the life estate under the doctrine of merger. We should certainly presume that the General Assembly did not perform a vain,. futile or fruitless act. 2 Horack’s Sutherland, Statutory Construction, 327 § 4510; 50 Am. Jur. 358, § 357; 82 C.J.S. Statutes. § 316. See Henderson v. Gladish, 198 Ark. 217, 128 S.W. 2d 257. Since the estates might also be dissolved by conveyance by the holder of the reversion and the holder of the life estate to a third person, under the doctrine of merger, the passage of Act 163 would be a wholly useless act, if the common law doctrine of destructibility remains effective. Consequently, if the doctrine did exist in Arkansas prior to the adoption of Act 163, Act 163 is sufficiently inconsistent therewith to constitute an implied repeal.


author: Frank Holt, Justice. (Ieorge Rose Smith, Justice, Carleton Harris, Chief Justice.

text:
    Reserve Life Ins. Co. v. Charles F. Hall, et al
    5-4792
    437 S.W. 2d 226
    Opinion Delivered February 17, 1969

      Rose, Meek, House, Barron, Nash & Williamson for appellant.

      Smith, Williams, Friday & Bowen, by William H. Sutton for appellees.
   Frank Holt, Justice.

This case relates to an employee’s scope of employment during a lunch hour. Appellant appeals from a judgment based upon a verdict of the jury holding it liable to the appellees for the negligence of appellant’s employee in an intersection accident. The jury found that at the time of the accident the employee, Mrs. Helen Christner, was acting within the scope of her employment.

For reversal appellant contends that there is no substantial evidence that at the time of the accident its employee was acting within the scope of her employment. We think appellant is correct.

On appeal we view the evidence and all reasonable inferences deducible therefrom in the light most favorable to the appellee and affirm the judgment of the trial court if there is any substantial evidence to support the verdict. St. Louis Southwestern Railway Co. v. Holwerk, 204 Ark. 587, 163 S.W. 2d 175.

When an employee is engaged in performing services for his employer, the employer is liable for his actions until the servant turns aside from the master’s business. In Lindley v. McKay, 201 Ark. 675, 146 S.W. 2d 545 (1941), we reaffirmed this well settled rule as stated in Sweeden v. Atkinson Imp. Co., 93 Ark. 397, 125 S.W. 439 (1910):

í í * * * And if the servant steps aside from the master’s business to do an independent act of his own and not connected with his master’s business, then the relation of master and servant is for such tune, however short, suspended; * * V’

To the same effect, see Healey v. Cockrill, 133 Ark. 327, 202 S.W. 229 (1918), and Van Dalsen v. Inman, 238 Ark. 237, 379 S.W. 2d 261 (1964). With this principle in mind, we review the evidence with particular reference to Van Dalsen, which we consider controlling in the case at bar.

The employee was in charge of the bookkeeping for appellant’s Little Rock office at 1515 West Seventh Street. She signed the checks, made the payroll and was in charge of the office when her supervisor was out of the office. One of her duties was to make deposits in the appellant’s bank account which was in her name. Most of the time she made the deposit by mail. However, with her employer’s knowledge, she would sometimes drive downtown in her own car and make the deposit. She kept the deposit slips in the office until the end of the month when she mailed them to the home office. She took her lunch hour whenever she desired. Her employment did not require her to travel. She provided her own means of transportation, and did not receive any form of reimbursement when she used her car in making bank deposits for the company. She was paid on a monthly basis.

On the day of the accident, appellant’s employee left the office about 11:30 a.m. in her own automobile. She drove downtown to her bank where she deposited her salary check. From there she went to another bank where she made a deposit in appellant’s account and received a copy of the deposit slip. The employee testified that from this bank she intended to proceed to Mitchell School at Roosevelt and Battery Streets, take her son home, and then return to work. Her child, being in the first grade, was dismissed at 12 o’clock, and since it was raining, she did not want him to walk home. According to Mrs. Oliristner, as she approached the intersection of Cumberland and Capitol Avenue, she debated whether to turn there but decided instead to continue south on Cumberland to Eighth Street, turn west on Eighth and proceed to Broadway, then out Broadway to Roosevelt and on to Battery where Mitchell School is located, thence to her home which was nearby at Roosevelt and Marshall. However, her plan was interrupted when she collided with a taxicab at the intersection of Cumberland and East Capitol.

Her immediate supervisor, who was out of the office on the day of the mishap, testified that the only deposits Mrs. Christner was required to make were by mail and that for this purpose she was furnished with envelopes and mail deposit slips. He was aware that on occasion she deposited company funds while on her lunch hour. However, she was not required to do so.

On cross-examination Mrs. Christner stated that she left the office in her car to make her own deposit and to pick up her son at school, and since she was going to be downtown, she decided to make the company’s deposit also. Further, she testified:

“Q. So that you had been to Union Bank and deposited your check, dropped by "Worthen and made the company’s deposit and was there anything else to do for the company at all?
A. No, sir.
Q. Then you had completed whatever you had done for the company, whatever you had to do for the company was done?
A. That is right.
Q. And you were on your way then to Mitchell School?
A. Tes, sir.”

The burden of proof was upon appellees to offer some substantial evidence that at the time of the accident appellant’s employee was acting within the scope of her employment. When the evidence is viewed most favorably to the appellees, we are of the view that at the time of Hie accident the appellant’s employee, during her lunch hour, had turned her attention to and was solely engaged in her own personal affairs — not those of her master’s. During this period of time the relationship of master and servant was suspended and the appellant cannot be responsible for her actions.

Reversed and dismissed.

George Rose Smith, J., concurs.

Harris, C.J., dissents.

(Ieorge Rose Smith, Justice,

concurring. To me the main problem here is that of deciding which of two diverging precedents we should follow. The majority opinion cites one of those two cases: Van Dalsen v. Inman, 238 Ark. 237, 379 S.W. 2d 261 (1964). The dissenting opinion discusses the other: Conway v. Hudspeth, 229 Ark. 735, 318 S.W. 2d 137 (1958).

In my best judgment the Van Dalsen case should be controlling. The pivotal point is that there, as here, the entire mission was basically a personal excursion. In Van Dalsen the employee left Stuttgart for the purpose of visiting his wife in a Little Rock hospital and then returning to his home in Stuttgart. On the way back, in the court’s words, “he digressed from the said personal and private mission long enough to leave a note” under his employer’s door in Pine Bluff. Pine Bluff was not on the direct route from Little Rock back to Stuttgart. The accident happened outside the city limits of Pine Bluff, still off the direct route. But the court found that the employee had ‘ ‘ resumed his private and personal mission to return to Stuttgart.”

In principle that case cannot be distinguished from this one. Here Mrs. Christner was on her lunch hour— a personal excursion, according to the undisputed proof. She digressed to go by the Worthen Bank to make a deposit for her employer, but, just as in the Van Dalsen case, she bad resumed her private and personal mission when the accident happened. Moreover, just as in the Van Dalscn ease, she was at a place where she would noi have been except for the business-motivated digression. It is immaterial that, in the language of the dissent, “the route that she was traveling led both to the object of her personal mission [her son’s school] and to her employer’s place of business,” because even if she had testified that she intended to return at once to her office she was still on her lunch hour and therefore not within the course of her employment.

It will be seen that the other precedent, Conway v. Hudspeth, is distinguishable, because the employee was not upon a mission that was primarily personal. All the pertinent incidents took place during business hours; so there the employee was presumptively engaged in his employer’s business from start to finish, unless a personal digression was shown. Thus the reasoning of that case cannot govern this one.

Carleton Harris, Chief Justice.

I disagree with the conclusion reached by the majority, as it is my opinion that the question of whether Mrs. Christner was acting within the scope of her employment at the time of the accident was a jury question, and there was substantial evidence to support the jury’s finding. This, in my opinion, is not a case where the employee left the office entirely for personal business, and only incidentally transacted some business in behalf of her employer. To the contrary, before Mrs. Christner left the company office, she prepared deposit slips for both her personal account at Union National Bank, and the company account at Worthen Bank, this account also being carried in .her name. Accordingly, it appears to me that, when leaving the office, she definitely had a dual purpose iu mind. After making her personal deposit she proceeded to the east side of Main Street to make the company deposit at the Worthen Bank. Thereafter, she testified that she intended to proceed to Mitchell School at Roosevelt and Battery Streets for the purpose of taking her son home, and then to return to work. The company office was located at 1515 West 7th Street. The accident took place at the intersection of Cumberland and East Capitol. Thus, Mrs. Christner had not reached the place where she would, in furtherance of her personal mission, deviate from the route that would take her back to appellant’s offices. She was still two blocks north of that point.

I wish to specifically call attention to the fact that Mrs. Christner would not have been on the east side of Main Street except for the fact that she made the company deposit in the Worihen Bank, i.e,, the collision would not have occurred had she proceeded from the Union Bank (where she made her personal deposit) to the school to pick up her son.

The importance of the fact that she bad not reached the location where the requirements of personal business would require a deviation from the office route, is pointed out in the case of Conway v. Hudspeth, 229 Ark. 735, 318 S.W. 2d 137. In that case, Conway had asked the trial court for a directed verdict, contending that it had not been established that Conway’s employee, Smith, was acting within the scope of his employment when the collision occurred. Smith was employed from time to time to wash cars, and do odd jobs at Conway’s place of business. A man named Karns became ill there, and Conway and Smith drove Karns to a hospital, where he obtained medicine. After leaving the hospital, Conway alighted from the car, and instructed Smith to take Karns home, “and come right back.” When testifying, Smith said that he drove Karns to his home, and then “I started out to see about my granddad.” According to the witness, he was on his way to the grandfather’s house when the accident happened. This court said that the trial court was correct in holding that the evidence made an issrre for the jury’s determination. We said:

“We are unable to say that the undisputed proof required the jury to find that Smith had left the course of his employment. In the first place, the geographical setting is not clearly disclosed by the proof. Conway’s used car lot, to which Smith was to return, is iu the downtown business district of Marshall, and the collision took place within the city limits, near the western edge of town. We are not told, however, where the Karns house is, except that it is in the north part of town, north of Highway 65. If the house-were due north of the point of the accident Smith’s deviation from the most direct return route might have been so slight as to support a finding that there had been no departure from the master’s business. Cahill v. Bradford, 172 Ark. 69, 287 S.W. 595.”

There is another interesting, and important, fact mentioned in the Comvay opinion. This court stated:

* * Since both Conway and Smith were interested parties, the jury was not required to accept Conway’s uncorroborated statement that he instructed Smith to come right back or to accept Smith’s unsupported testimony that he had started to see about his grandfather. Bullock v. Miner, 225 Ark. 897, 286 S.W. 2d 328. Inasmuch as the route that Smith was traveling led both to the object of his personal mission and to his employer’s second place of business, it was for the jury to say which destination Smith had in mind when he began the trip.”

The above statement is particularly apropos to the present case. After all, the only evidence that Mrs. Christner had concluded her employer’s business, and had started out on her own mission (to pick up her son), was given by Mrs. Christner herhelf, and the jury was not required to accept her uncorroborated statement as to her intentions. Likewise, as already pointed out, the route that she was traveling led both to the object of her personal mission and to her employer’s place of business, and it was therefore for the jury to say which destination Mrs. Christner had in mind when she began the trip.

I respectfully, bnt earnestly, dissent.


author: Carretón Harris, Chief Justice.

text:
    Janie Lorean Edwards, Adm’x v. T. H. Epperson & Son House Moving Co., Inc.
    5-4759
    437 S.W. 2d 480
    Opinion Delivered February 24, 1969

      Fred A. Newth, Jr. and Billy B. Bowe for appellant.

      Cookrill, Laser, Metíehee, Sharp & Boswell for appellee.
   Carretón Harris, Chief Justice.

Janie Lorean Edwards, appellant, widow of Charlie Howard Edwards, and administratrix of his estate, instituted suit for his wrongful death against T. H. Epperson & Son House Moving Company, Inc., appellee herein, and Arkansas PoAver & Light Company. Prior to trial, a non-suit was taken against the power company, and the case proceeded to trial against the Epperson Company. When appellant completed her case, appellee moved for a directed verdict. The motion was overruled, and the cause was submitted to the jury. A verdict was returned in the amount of $96,250.00 for appellant, and a motion AA7as then made by appellee for a judgment non obstante veredicto. The court granted the motion, and entered a judgment for appellee, dismissing appellant’s complaint Avith prejudice. From this judgment, appellant brings this appeal.

The complaint alleged that Edwards was killed while engaged in moving a house on TT.S. Highway 67. It Avas asserted that Edwards, who Avas riding on top of the house, was struck by a guy wire, Avhich had been placed across the highway by the power and light company. Further allegations were to the effect that the truck was being driven by Ed Epperson, an agent and employee of the Epperson Company, and that the death of Edwards Avas the result of the negligence of the driver, who was traveling at an excessive rate of speed, failed to keep a proper lookout, failed to use proper control, and did not heed a warning to stop. Appellee’s position is that it Avas established at the time of the accident that Epperson was employed and acting on behalf of D. F. Arey, Avho was also engaged in the business of hauling houses. After the jury verdict, the court concluded that, though there was sufficient evidence as to negligence and proximate cause to justify submission of the case to the jury, there was not sufficient evidence that Epperson was acting for and in behalf of Epperson & Son House Moving Company to make a jury question. On this basis alone, the n.o.v. judgment was rendered.

For reversal of the court’s judgment, it is first argued that the court had no authority to enter a judgment notwithstanding the verdict, and it is contended that this would have been proper only if the pleadings had shown conclusively that one of the parties was entitled to a judgment as a matter of law. It is asserted that the court could do no more than set aside the jury verdict, and this action would, of course, permit another trial. Appellant is in error. In Stanton v. Arkansas Democrat Company, 194 Ark. 135, 106 S.W. 2d 584, this court was presented the same argument, but we disagreed, pointing out that there is a distinction between a ease where a final judgment has been rendered and entered of record, and where only a jury verdict has been received, and we held that in the last instance, a judgment non obstante veredicto could be entered. The court said.

“The question there reserved is now decided, and we hold that after a verdict has been returned, but before the entry of judgment thereon, the court has the jurisdiction to determine whether judgment shall be entered, and, if so, what judgment, and if it be found by the court before the entry of judgment that no testimony has been offered to sustain the verdict, and that no cause of action has been shown to exist, the court has the jurisdiction to so declare and to direct the judgment which shall be entered. If it is thought that the court has acted erroneously a bill of exceptions should be filed, which would afford us on the appeal the opportunity to pass upon the question whether, under the testimony, a verdict should have been directed in favor of the party for whom judgment was rendered. ’ ’

In a much more recent case, Spink v. Mourton, 235 Ark. 919, 362 S.W. 2d 665 (1962), the Stanton holding was reiterated. We stated:

“The verdict -was in favor of Mourton. Now it is true that the trial judge might have granted a new trial if he found the verdict to be against the preponderance of the evidence. Bockman v. World Ins. Co., 222 Ark. 877, 263 S.W. 2d 486. But this case does not involve a motion for a new trial; instead, the request was for a judgment notwithstanding the verdict. Such a motion ■may be granted if there is no substantial evidence bo support the verdict.”

Accordingly, the only question before us is whether there was sufficient proof that Ed Epperson, the driver of the truck, was an agent or employee of appellee company at the time of the accident. The evidence in support of this allegation is as follows:

1. Ed Epperson, the driver of the truck, is a vice-president of T. H. Epperson & Son House Moving Company, Inc.

2. Two other regular Epperson employees (Charlie Edwnrds and Obie Horn) were also on this particular job.

3. Baymond Edwards, son of the deceased, testified that he worked for Epperson “off and on” for two years prior to the date of the accident, and he said that, though Arey owned the tractor that was being used, the trailer was owned by Epperson. This witness stated that he and his father had “built” the trailer, though his subsequent testimony indicated that he meant they had lengthened it by three feet. He also said that he eonld itdentify it by a welding mark, this repair having been occasioned by a ripped place near the second wheel.

4. A permit had been obtained by Epperson from the Highway Commission to move a house from Malvern to a destination 14 miles north of Malvern, the job to be performed between May 12 and May 16. This permit was numbered 22018. Arey had also been issued a permit by the Highway Department to move a house from Malvern to a destination 14 miles north of Malvern, the job to be performed between May 12 and May 16. This permit was numbered 22019.

The evidence offered by appellee relative to these facts, in the order listed, was as follows :

1. Ed Epperson testified that Arey contacted him requesting that he (Epperson) help him in moving the building, because Arey’s wife was in the hospital, and Arey wanted to take her home. Epperson said that he was paid $25.00 b}^ Arey, which he spent; no money was paid to the Epperson corporation. Arey testified as follows:

“On the day of the accident I called Mr. Epperson the night before and asked him if he wasn’t too busy would he go down the next day and drive my truck while I come in and got my wife out of the hospital and I would be right back down there to take over.”

2. Epperson testified that Edwards was working for Arey on the day in question, and was paid by Arey. Are}?- testified that he hired Edwards for this particular job at a rate of $20.00 per day, and he also said that he hired Horn on this job. The witness stated that he received all of the money for moving the house, and that the Epperson corporation received nothing.

3. Raymond Edwards testified that his father had worked on Arey jobs previously, and that he (Raymond) had also, on one occasion, worked on an Arey job.

On cross-examination, the witness admitted that he did not know who the trailer belonged to on the date of the accident, and he also conceded that another trailer could have been welded in the same place. Epperson testified that Edwards had nothing to do with building the trailer, and said that it was bought in Pine Bluff about 15 years ago.

4. This was the strongest circumstance offered by appellant, for it does seem unusual that these two permits were issued on the same date, consecutively numbered, permitting the moving of houses during the same period of time, approximately the same distance and in the same direction, from Malvern. Though this was the strongest evidence offered, strangely enough, appellee’s evidence with regard to these facts, is probably the most convincing that it offered. An examination of the record reveals that different vehicles were undoubtedly involved. The Epperson application and permit reflect a truck license number of D402, and a trailer license number of ST6673, while the Arey application and permit show a truck license number of C838 and. a trailer license, ST6455. The width of the load in the Epperson permit is shown as 20 feet, while the width of the load in the Arey application is 22 feet. Epperson testified that the job that occasioned his application involved moving a construction shack belonging to an asphalt plant, and Arey testified that his contract was to move a house for a Mrs. Moody.

We agree with the trial court that the evidence was insufficient to make a jury question. The testimony by Epperson and Arey that Epperson and Edwards were working for Arey on this occasion is undisputed. There is also some significance in the fact that Edwards, though an employee of appellee, had, on other occasions, worked for Arey.

The testimony of Raymond Edwards is of no value, because he was unable to dispute the ownership of the trailer, i.e., he admittedly did not know who owned the trailer on the day of the accident. While the information shown in the applications and permits would perhaps, at first blush, indicate the same moving job, this conclusion is shown to be erroneous when the applications and permits are more clearly examined. "Very definitely, the permits show, not only that applications were made by two different persons, but more important, that two different trucks and trailers were to be used. We see no reason for appellee to have obtained two permits for the same haul. These permits were granted five clays before the accident, and there would certainly have been no point at that time in endeavoring to create confusion as to which company had the job. In addition, a picture of the truck and trailer with the house upon it is in the transcript. This picture was taken by Don’s Studio of Malvern after the accident, and very clearly shows the license numbers of both the truck and trailer belonging to Arey. Of course, we suppose it is possible that Epperson could own both trucks and trailers, but there is not a line of testimony to support such a supposition, nor does appellant make this suggestion or contention.

Complaint is made that the court erroneously refused to permit the sheriff to testify that Epperson, at the scene of the accident, presented a card, which would have identified him in his capacity with the appellee corporation. Objection was sustained when counsel asked what appeared on the card. We do not agree that error was committed. There was no effort to offer the card itself, which would, of course, have been the best evidence, and there was no evidence that the card had been lost. It may be that the officer simply looked at the card, rather than taking it, but this is not shown Before the sheriff could have testified, it would have been necessary to make proof of why the card could not be presented. Town and Country Trailer Sales, Inc. v. Godwin, 233 Ark. 307, 344 S.W. 2d 338. Not only that, but no offer of proof was ever made showing what the sheriff’s answer would have been had he been permitted to answer the question. It was necessary that this tender of proof be made. City of Little Rock v. Sawyer, 228 Ark. 516, 309 S.W. 2d 30.

The court’s action in granting the judgment non obstante veredicto was not error.

Affirmed.

      This had reference to the case of Scharff Distilling Company v. Dennis, 113 Ark. 221, 168 S.W. 141.

      Emphasis supplied.

      Even if the card identified Epperson as a vice-president of appellee company, it would not appear that this would have added very much to appellant’s evidence, for Epperson, normally being associated with appellee company, might well have carried personal cards reflecting that fact.


author: George Rose Smith, Justice.

text:
    Kirby C. Seay et ux v. E. T. Davis et al
    5-4793
    438 S.W. 2d 479
    Opinion Delivered February 24, 1969
    [Supplemental Opinion on denial of Rehearing April 7, 1969, p. 627.]

      Lon Gillespie for appellants.

      Spencer & Spencer for appellees.
   George Rose Smith, Justice.

The question is whether the chancellor was right in holding that the plaintiff-appellants were not entitled to accelerate the maturity of a note and mortgage because of the debtors ’ 48-hour delay in tendering the amount of the third monthly installment. We hold that the chancellor was right.

On April 8, 1968, Seay and his wife sold the Rose Haven Motel in El Dorado to the appellees, E. T. Davis and his son, T. G. Davis, for $185,000. The Davises made a down payment of $30,000 and gave a note and mortgage for the remainder, payable in monthly installments of $1,682.21. The first two payments were made within the one-month grace period allowed by the contract, but the check for the next payment given on July 29 by T. G. Davis was returned for insufficient funds on July 31 — the last day of the grace period.

Seay at once exercised his option to accelerate the maturity of the note and without advance notice to the Davises filed this foreclosure suit on August 2. The court appointed a receiver, who operated the motel at a profit until he was discharged. The Davises’ answer tendered the amount of the delinquency, plus court costs and an attorney’s fee, and asked that the acceleration of the debt be set aside and that the receivership be terminated. After a hearing the court entered a decree which in effect granted the debtors the relief they sought but retained jurisdiction to renew the receivership if the debtors should again become delinquent.

It was formerly our rule that equity would grant relief against an attempted acceleration only for aecident, mistake, fraud, or other inequitable conduct. Johnson v. Guaranty Bk. & Tr. Co., 177 Ark. 770, 9 S.W. 2d 3 (1928). That rule has been changed by the Uniform Commercial Code, which reads:

A term providing that one party or his successor in interest may accelerate payment or performance or require collateral or additional collateral “at will” or “when he deems himself insecure” or in words of similar import shall be construed to mean that he shall have power to do so only if he in good faith believes that the prospect of payment or performance is impaired. The burden of establishing lack of good faith is on the party against whom the power has been exercised. Ark. Stat. Ann. § 85-1-208 (Add. 1961).

The note in this case falls within the intent of the code, its language being that in the event of default the note may be accelerated “at the option of the holder.”

Thus under the Code the issue centers upon Seay’s good faith. In our opinion the weight of the evidence supports the view that Seay did not in good faith believe that “the prospect of payment or performance” had been substantially impaired. Before the default occurred Seay had complained to the elder Davis that-his son was not capable of managing the motel properly. In our judgment that grievance was effectually answered by Davis’s assurance that if a delinquency-in the installment payments should occur Davis would, on being notified, make it good within three hours. According to Mr. Davis’s testimony, which the chancellor evidently accepted, Seay promised to give Davis notice (and, inferentially, an opportunity to pay the arrearage) before filing a foreclosure suit. No such notice was actually given.

Moreover, on the issue of good faith it is important to remember that the sellers had received a $30,000 down payment and two monthly installments totaling more than $3,000. That the receivership proved to be profitable confirms the conclusion that the property itself could be expected to liquidate the indebtedness against it within the time and manner provided by the note and mortgage. On the record as a whole we cannot say that the chancellor was wrong in concluding from the Davises’ testimony that the seders were motivated by a desire to turn the down payment into a quick profit rather than by a good faith conviction that the purchasers could not perform their contract.

Affirmed.


author: Lyle Brown, Justice.

text:
    Arkansas State Highway Comm’n v. Martha P. Darr
    5-4845
    437 S.W. 2d 463
    Opinion Delivered February 24, 1969

      Thomas B. Keys and Kenneth R. Brock for appellant.

      Lawes & Schulze and Phil H. Loh for appellee.
   Lyle Brown, Justice.

This is an eminent domain case wherein appellee, Martha P. Darr, was awarded $50,000 for lands taken by the Arkansas State Highway Commission. The Commission appeals on the singlo, ground that there is no substantial evidence to support the verdict.

Mrs. Dari', a widow, owns a farm in Conway County consisting' of 280 acres. Interstate 40 right-of-way traverses the southwest corner of her property at an angle. The taking' of 9.55 acres left a strip of 6.6 acres in the extreme southwest corner isolated from the remainder of the lands. The taking cut off Mrs. Darr’s oidy means of public access. Prior to the taking a public road led from Highway 64 to the farm and connected with it at the southwest corner. After the taking she has access by that route only to the 6.6 acres and can go no farther upon her lands because of Interstate 40. The remaining unit of 264 acres is completely surrounded by the right-of-way and other landowners. Future access to the large tract would have to be by permission of neighboring landowners or by condemnation proceedings brought by Mrs. Darr to establish a public road across her neighbors’ property.

Two expert witnesses testified on behalf of Mrs. Darr. It was C. V. Barnes’ opinion that appellee had been damaged $38,500. Lloyd Pearce fixed her damages at $43,250. The only other landowner testimony considered on damages was that of Mrs. Darr. She fixed her damages at $98,500. So a verdict of $50,000 must stand or fall on the strength of Mrs. Darr’s testimony.

We are committed to the majority rule that a landowner is permitted to testify because of his status as an owner. Arkansas State Highway Comm’n. v. Fowler, 240 Ark. 595, 401 S.W. 2d 1 (1966); reaffirmed in Arkansas State HighWay Comm’n. v. Drennen, 241 Ark. 94, 406 S.W. 2d 327 (1966). But as pointed out in Fowler, the weight of the landowner’s value testimony is affected by his knowledge of values. Before Mrs. Darr’s conclusion on damages can pass the substantial evidence test, her testimony must be examined to see if she gave a. satisfactory explanation for her conclusion. Arkansas State Highway Comm’n. v. Byars, 221 Ark. 845, 256 S.W. 2d 738 (1953). We also said in Byars that the determination of substantial evidence is a question of law and not of fact.

Mrs. Darr’s testimony on- her damages is clearly not substantial. Her husband owned this property when they were married in 1941. She has been a, registered nurse since 1933 and presently resides and works in Bussellville, some twenty miles distant. It is not disclosed- when she resided on this land, if ever. She showed no reasonable knowledge of market values of lands in the community. She was never asked if she had an opinion as to the fair market value of her lands; she was merely asked the worth of the lands without any restriction on the meaning of “worth.” It is apparent that she had a sentimental attachment for the farm. She frankly stated tliat she would not sell it for any price “because my husband told me to keep it.” She reduced the value of the remainder from $400 to $50, whereas her expert witness, C. V. Barnes, placed a value of $220 per acre on the remainder. It was her theory that her lands were hopelessly locked off from any possible access. She forecasted no reasonable cooperation from her neighbors. That attitude was in the face of the fact that one neighbor had offered her access if she would contribute to the cost of construction. Another neighbor was permitting Mrs. Darr’s present tenant to use that neighbor’s private road for ingress and egress.

Having concluded that Mrs. Darr’s testimony was not substantial, we must hold the verdict to be excessive.

We have on many occasions offered the landowner in eminent domain cases the opportunity to enter a remittitur. The allowance of remittiturs by our Court is almost as old as our jurisprudence; however, the rule is not the same in all cases. We think it would be helpful to the bench and bar if the two general rules governing remittiturs were here stated in the hope that such a statement will contribute to clarity.

1. There are those cases in which no error is committed in the trial court which might affect the verdict. Yet it is sometimes shown by the record before us that a verdict clearly goes beyond the limit of just compensation. That may be caused, for example, wherein a jury misconceives the proper standard of measuring damages; or the jury may be “prompted by sympathy for the plaintiff or prejudices against the defendant.” That situation was before the Court in St. Louis, I.M.&S. Ry. v. Snell, 82 Ark. 61, 100 S.W. 67 (1907). There we find the general rule:

In this case there is no error of the court to cure, and we require the plaintiff to remit down to an amount that we would be willing to approve if the jury had returned a verdict for that amount.

The Snell case was cited with approval in Missouri Pac. R.R. v. Newton, 205 Ark. 353, 168 S.W. 2d 812 (1943); and in Louisiana & Ark. Ry. v. Rider, 103 Ark. 558, 146 S.W. 849 (1912). Since 1907 the same general rule enunciated in Snell has been applied in a multitude of cases.

2. A second and different rule applies where there is error in the trial court which enhances the award. The rule in such a case is exhaustively treated in St. Louis, I.M.&S. Ry. v. Adams, 74 Ark. 326, 86 S.W. 287 (1905). Succinctly stated, the holding in that case is that if the injured party is entitled to recover this Court may, in its discretion, fix an amount which it can see is clearly not excessive. This guideline and reasoning is recited:

The court must be certain not to put the amount too high; for, as before stated, the defendant has no option in the matter, and must submit to the judgment allowed by the court, while the plaintiff has the right to reject the offer if he chooses to do so. There is, then, little danger in putting the amount low, and the court should always go down to a sum which it can feel certain that the defendant should pay, and which under the evidence the plaintiff is clearly entitled to recover. If it should be less than the plaintiff is entitled to under the evidence, the defendant is not injured; for, if the plaintiff accésits it, defendant then gets off with less than he was liable to pay. On the other hand, as plaintiff is not compelled to accept the amount offered, he has no ground for complaint that the court, instead of reversing the case outright on account of an error for which he is partly to blame, and forcing him to undergo a new trial, gives him the privilege of faking the sum named, and by doing so of getting some substantial compensation without the trouble and expense of further litigation.

Aclams goes on to state that the Court “will be less inclined to grant this privilege [remittitur] where the errors at the trial have been gross, or where improper conduct on the part of plaintiff or his counsel has been such as to excite the prejudices of the jury.”

The Adams case was cited with approval as late as the case of Ark. State Highway Comm’n. v. Watkins, 229 Ark. 27, 313 S.W. 2d 86 (1958). It was cited to support “established procedure.”

The case before us fads within the second rule. That is because Mrs. Darr was not qualified to give value testimony and it is clear that her award was enhanced as a result of her opinion. The verdict was in excess of her highest value witness by $6750. This brings us to the most difficult problem of the ease and one which has given us no little concern. Can we fix an amount which (1) we are certain is not too high and (2) fix it at a figure which under the evidence the defendant should pay and the landowner is clearly entitled to recover? When we speak of being certain we are in the realm of being unmistakably correct, free from doubt, infallible. It is our conclusion that we cannot so arrive at such a figure.

First, we consider the value testimony of four expert witnesses, two for each side. Mrs. Darr’s witnesses fixed damages at $43,250 and $38,500; the Commission’s witnesses fixed just compensation at $23,500 and $22,750. The testimony of her highest value witness, Lloyd Pearce, is subject to some doubt and uncertainty because he was not sure about the actual acreage in woodland; further, he did not calculate the possibility of Mrs. Darr gaining access over a ramp being built by one of Mrs. Darr’s neighbors. The testimony of her other witness, C. Y. Barnes, is more impressive and particularly so because uo serious attack is made on Ms evidence on appeal. Yet, to accept Ms figure with the certainty and clarity required by law, we would have to shut our eyes to the testimony of witnesses Mashburn and McMurroug’h for the Commission. Their qualifications are impressive and their evidence reflects a professional study of the involved lands and surrounding farms; and they fortified tlieir conclusions by what appeared to be fairly comparable sales.

Summarizing, the testimony of Barnes, Mashburn, and McMurrough can all be classed as substantial; yet they arrived at different conclusions. For that, reason and additionally because we did not have the advantage of hearing the witnesses, we would have to speculate to fix a remittitur.

Reversed and remanded.


author: John A. Fooleman, Justice.

text:
    State of Arkansas, ex rel Joe Purcell, Attorney General, Arkansas State Highway Commission v. G. D. Nelson, Berry Petroleum Company, et al
    5-4653
    438 S.W. 2d 33
    Opinion Delivered February 24, 1969
    [Rehearing denied April 1, 1969.]

      Joe Purcell, Atty. Gen.; Les Evitts, Ch. Dep. Atty. Gen. and Shaver & Shaver and Glassie, Pewett, Beebe & Shanks for appellants.

      Catlett & Henderson and Keith, Clegg & Eckert and Mahony & Yocum and Smith, Williams, Friday & Bowen by Emon A. Mahony, Jr. for appellees.
   John A. Fooleman, Justice.

This appeal was taken from an order in an action originally brought by G. I). Nelson, a citizen and taxpayer, against Berry Petroleum Company, Arkansas Bitumuls Company, Lion Oil, Inc., MacMillan Ring-Free Oil Company, Inc. and Bitucote Products Company. We held that Nelson had stated a cause of action against the above-named parties. Nelson v. Berry Petroleum Co., 242 Ark. 273, 413 S.W. 2d 46. After remand each of the defendants answered, denying the allegations of Nelson’s complaint and pleading the statute of limitations. The plaintiff taxpayer then filed a motion asking that he be permitted to proceed without cost to him or any other taxpayer and that the State of Arkansas be required to bear the cost of the proceedings. Thereafter, the state and its Highway Commission sought permission to intervene, alleging that this action was necessary in order to protect the interests of the state and its citizens and taxpayers. In response to Nelson’s motion, the state, through its Attorney General and the Highway Commission, expressed willingness to assume the prosecution of the cause, which, they said, would obviate the necessity of further cost being borne by Nelson. Permission to intervene was granted.

The intervenors, before filing any other pleading but within the time allowed them for filing their intervention, filed a motion for stay of the proceedings. In this motion, it was alleged that intervenors had- filed suits in the United States District Court for Eastern District of Arkansas against the defendants seeking recovery under the Sherman and Clayton Acts for alleged price fixing and allocation of territory by them. As a basis for the stay, the state asserted that, although the causes of action arose out of the same course of conduct by the defendants, recovery of treble damages, attorneys’ fees and costs and expenses permitted under the federal laws could not be had in the state action. The court was asked to stay all proceedings by any party until disposition has been made of the cases pending in the federal district court, and to relieve the intervenors of further pleading until they were ordered to do so. The trial court denied the motion, but continued the matter and granted intervenors an additional week for filing their intervention.

This intervention sought recovery from the defendants for an alleged conspiracy to fix prices for asphaltic materials sold to the Arkansas State Highway Department. Answers "were filed by the defendants. The complaint of intervenors reasserted the grounds of their motion for stay and added an allegation that the United States District Court had greater familiarity with trials of the issues presented so that the issues could be determined in that court in a more orderly and less expensive manner than would obtain in the state court. The motion lor stay was renewed. After pretrial conferences, the chancery court entered an order on December 5, 3968, denying- the motion for stay, appointing a Special Master and requiring the deposit of $5,000 ($2,500 by intervenors and $2,500 by defendants), from which the fees and expenses of the master would be paid as they accrued. Intervenors then filed another motion for a stay of proceedings and a reconsideration of the court’s action.

At a subsequent pretrial conference, the chancellor denied the motion for reconsideration. He specifically denied intervenors’ request for a stay of proceedings either until disposition of the case in federal district court or until November 1968. Appeal was taken by intervenors from both orders.

The plaintiff Nelson and all defendants joined in a motion to dismiss the appeal on the ground that the orders were not appealable. Appellants then filed a petition for mandamus, or, in the alternative, for prohibition or certiorari, seeking the vacation of the chancery court’s orders, and asserting that the court had acted in excess of its jurisdiction and had abused its discretion. We agree that the appointment of a Special Master and the requirement of advance deposit by appellants for costs and expenses of the proceeding were in excess of the court’s jurisdiction.

We have recently had occasion to review the situations in which an order of a trial court is appealable. See Johnson v. Johnson, 243 Ark. 656, 421 S.W. 2d 605; Wright v. City of Little Rook, 245 Ark. 355, 432 S.W. 2d 488; and Allred v. National Old Line Ins. Co., 245 Ark. 893, 435 S.W. 2d 104. We find no such finality as would permit an appeal of the chancery court’s orders under the standards repeated in those cases.

Appellants rely upon the rule that an appeal lies when a distinct and severable branch of a case is finally determined. We do not think that it can be said that any action by the court relates to a distinct or sever-able branch of this case. It seems, on the other hand, that each such action is an integral part of the entire proceeding. We recently held that denial of trial by jury and a limitation of the scope of a hearing before a circuit court were not such determinations as would permit review by appeal before final disposition of the case. See Wright v. City of Little Rock, supra. Each action of the chancery court here is no more a final determination of a severable branch of the case than was the action of the circuit court there.

This does not mean, however, that the actions of trial courts are not subject to review by this court under its its supervisory jurisdiction. Article 7, § 4, Constitution of Arkansas. Writs of mandamus, prohibition and certiorari are designed for the appropriate exercise of this jurisdiction, where appellate remedy is unavailable or inadequate.

The primary function of the writ of mandamus is to require an inferior court or tribunal to act when it has improperly failed or declined to do so. Satterfield v. Fewell, 202 Ark. 67, 149 S.W. 2d 949; Thompson v. Foote, 199 Ark. 474, 134 S.W. 2d 11; Hammond v. Kirby, 233 Ark. 560, 345 S.W. 2d 910. It is never applied to control the discretion of a trial court or tribunal. Smith v. Sullivan, 190 Ark. 859, 81 S.W. 2d 922; Jackson v. Collins, 193 Ark. 737, 102 S.W. 2d 548; Hardin v. Cassinelli, 204 Ark. 1016, 166 S.W. 2d 258; State ex rel Pilkinton v. Bush, 211 Ark. 28, 198 S.W. 2d 1004; Village Creek Drainage District v. Ivie, 168 Ark. 523, 271 S.W. 4. Nor can it be used to correct an erroneous exercise of discretion. Jackson v. Collins, supra; Mance v. Mundt, 199 Ark. 729, 135 S.W. 2d 848, Mobley v. Scott, 236 Ark. 163, 365 S.W. 2d 122; Dotson v. Ritchie, 211 Ark. 789, 202 S.W. 2d 603; State ex rel v. City of Marianna, 183 Ark. 927, 39 S.W. 2d 301; Jones v. Adkins, 170 Ark. 298, 316, 280 S.W. 389.

Edmondson v. Bourland, 179 Ark. 975, 188 S.W. 2d 1020, rolled upon by appellants, where mandamus was granted, is not applicable here. There we said that a refusal by a trial court to permit a defendant to file a motion to set aside the appointment of a guardian ad litem for her, together with the striking of an answer and cross complaint filed for her by attorneys of her own choice, amounted to an arbitrary refusal to proceed with the case. Mandamus has always been an appropriate remedy in such cases. The utilization of the writ of mandamus in La Buy v. Howes Leather Co., 352 U.S. 249, 77 S. Ct. 309, 1 L. Ed. 2d 290, wherein the reference of an antitrust case to a master was corrected, is not authority for such action here. There the federal appellate courts were enforcing the application of their own procedural rules — a factor not involved here. Even so, four members of that court thought the remedy was not appropriate.

The fundamental purpose of the writ of prohibition is to prevent a court from exercising jurisdiction not possessed by it- or a power not authorized by law, when there is no other adequate remedy by appeal or otherwise. Robinson v. Merritt, 229 Ark. 204, 314 S.W. 2d 214; Harkey v. Matthews, 243 Ark. 775, 422 S.W. 2d 410. It is not available otherwise to correct erroneous action of a trial court. Bassett v. Bourland, 175 Ark. 271, 299 S.W. 13; St. Paul-Mercury Indemnity Co. v. Taylor, 229 Ark. 187, 313 S.W. 2d 799; Wilson v. Williams, 215 Ark. 576, 221 S.W. 2d 773; Lowery v. Steel, 215 Ark. 240, 219 S.W. 2d 932. It cannot be used as a substitute for appeal or certiorari and is not available to bar proceedings pending in a court if the court has jurisdiction. Schirmer v. Cockrill, 223 Ark. 817, 269 S.W. 2d 300.

Certiorari lies to correct proceedings erroneous upon the face of the record when there is no other adequate remedy. North Little Rock Transportation Co. v. Sangster, 210 Ark. 294, 195 S.W. 2d 549; Burgett v. Apperson, 52 Ark. 213, 12 S.W. 559; Martin v. Hargrove, 149 Ark. 383, 232 S.W. 596. It is available in the exercise of superintending control over a tribunal which is proceeding illegally where no other mode of review has been provided. McCain v. Collins, 204 Ark. 521, 164 S.W. 2d 448; Merchants & Planters Bank v. Fitzgerald, 61 Ark. 605, 33 S.W. 1064; see also Baxter v. Brooks, 29 Ark. 173. Certiorari lies where there is a want of jurisdiction or an act in excess of jurisdiction which is apparent on the face of the record. City of Fayetteville v. Baker, 176 Ark. 1030, 5 S.W. 2d 302; Hardin v. Norsworthy, 204 Ark. 943, 165 S.W. 2d 609; Martin v. Hargrove, supra. It is not available to look beyond the face of ■ the record to ascertain the actual merits of a controversy, to control discretion, to review a finding upon facts or review the exercise of a court’s discretionary authority. Hardin v. Norsworthy, supra; Arkansas State Highway Comm. v. Light, 235 Ark. 808, 363 S.W. 2d 134; Hendricks v. Parker, 237 Ark. 656, 375 S.W. 2d 811.

When there is a remedy by appeal, a writ of certiorari will not be granted unless there was a want of jurisdiction, or an excess in its exercise, by the court below. Baxter v. Brooks, 29 Ark. 173.

The first ground asserted as a basis for this appeal is that the position of the taxpayer in this lawsuit is not in the best interest of the state in light of the litigation pending in the federal courts. In the absence of charges of wrongdoing by state officials, it does seem odd that parties whose positions are as adverse as those of Nelson and the defendants sued by him would make virtually identical contentions on the matters which were before the trial court. Yet, a determination that the taxpaying plaintiff’s action was not in the best interest of the state, on the face of the record only, would be premature. There is no statute governing taxpayer’s actions, so this question can only be determined on a trial of the case on its merits. It cannot be reviewed by us at this time in the exercise of any supervisory jurisdiction.

The next point relied upon by appellant is the assertion that the chancellor erred in denying appellant’s motion for a stay. The granting or denial of a stay or continuance is a matter lying within the sound judicial discretion of the trial court. Phillips v. Nowlin, 238 Ark. 480, 382 S.W. 2d 588. It has never been held that the pendency of an action in the federal courts is a ground for a continuance or abatement of an action in our state courts. See Boynton v. Brown, 103 Ark. 513, 145 S.W. 242. If the chancery court was in error through manifest abuse of discretion in refusing the stay, that error is correctable on appeal from a judgment adverse to appellants, at the proper time. Keenan v. Strait, 221 Ark. 83, 252 S.W. 2d 76; Burriss v. Wise & Hind, 2 Ark. 33; Great American Ins. Co. v. Stevens, 178 Ark. 84, 10 S.W. 2d 356.

Since the trial court exercised its discretion in a matter clearly within its jurisdiction, its action is not subject to review at this time. It is not clear to us why appellee-plaintiff Nelson prefers a trial in the state court in view of the possible recovery of treble damages in the federal courts. There is no allegation that the duly designated state officials are not pursuing the matter aggressively and in good faith. Yet the courts cannot control the taxpayer’s actions in this matter in the absence of statutory guidlines in this field, and we cannot review the trial court’s action in this regard at this stage of the proceeding.

In his first pretrial order, the chancellor appointed a Special Master, and instructed him to prescribe rules for the expeditious and orderly progress of the tasks with which he was charged, and to proceed with hearing of evidence and ruling upon all matters of fact and law incident thereto. The master was directed, upon completion of the presentation of evidence, to prepare and file his recommended findings of fact and conclusions of law and a proposed decree. In this respect, the trial court was proceeding illegally. Before a master is appointed, the main issue establishing the rights of the parties should be determined so that definite directions can be given to the master for his guidance. Hicks v. Hogan, 36 Ark. 298; Fullenwider v. Bank of Waldo, 101 Ark. 259, 142 S.W. 149. It was pointed out, in Hicks v. Hogan, that the chancellor should hear the cause upon the pleadings and such evidence as may enable him to determine the principles to be applied in adjusting the equities of the parties and then make a reference to a master for such special inquiries or statements of accounts as may aid the court in making a definite decree. The decision in La Buy v. Howes Leather Co. 352 U.S. 249, 77 Sup. Ct. 309, 1 L. Ed. 2d 290 (1957) involved the application of the very same principle to an antitrust ease which included charges of monopoly and price fixing under the Sherman Act. In that opinion, the United States Supreme Court stated that’the use of masters was to aid judges in the performance of sjjecific judicial duties as they arise and not to displace the court. They held that the appointment of a master and a reference at the inception of the case to take evidence and to report the same to the court Avith his findings of fact and conclusions of law Avas an action beyond the court’s powers. There, as here, an effort avus made to support the reference by reason of anticipation of a lengthy trial, complexity of the issues and congestion of the court’s calendar. We agree with the Supreme Court of the United States that these reasons do not constitute sufficient grounds for the virtual displacement of the court by a Special Master. While we can conceive of situations in Avliieh a reference of particular matters may be made to a master during the course of litigation, a reference as broad as the one involved here is clearly in excess of the court’s jurisdiction and in that respect the court proceeded without authority of law. Jones v. Adkins, 170 Ark. 298, 280 S.W. 389; relied upon by appellees, is not contrary to this view. The only issue there was an accounting, for which purpose we have always recognized the power of the court to appoint a master. If this case should reach the point where the only issue remaining is a matter of accounting, the appointment of a master would be appropriate.

"We have not overlooked the argument of appellees that there was an agreement to the appointment of a master. The record does disclose a colloquy among the court and counsel for the respective parties at a pretrial conference on October 16, 1968, at which all seem to have agreed that a master should be appointed in the case. At that time appellants’ complaint had not been filed. There was no suggestion, until the order of December 5 was entered, that the reference to the master would be as extensive as set out in the court’s order. An objection to the appointment was made by appellants at a pretrial conference on November 17. It was repeated in their motion for reconsideration.

Appellees also argue that the chancellor’s statements after the entry of the order appointing the master indicate that he did not intend to refer the whole case, but would maintain control over the activities of the master. We can only regard the content of the court’s order in reviewing the matter on certiorari. We agree with the chancellor’s statement on hearing the motion for reconsideration that the work of the master can be postponed until such times as the issues are developed to a point where a reference is proper and desirable.

We have previously recognized the state’s immunity from costs when acting in a governmental capacity in an action not brought by it. McCastlain v. Oklahoma Gas & Electric, 243 Ark. 506, 420 S.W. 2d 893. We did recognize that the rule is altered when there is specific statutory authority for payment of costs by the state; however, Ark. Stat. Ann. § 27-2307 provides that the state shall not be required to give security for costs. Master’s fees and expenses are costs in the sense in which the word is used in this statute. See Jones v. Adkins, 170 Ark. 298, 280 S.W. 389.

The chancery court’s order in this respect was unauthorized and in excess of its jurisdiction.

In the respects in which we have found that the trial court was proceeding illegally and in excess of its jurisdiction, treating the proceedings here to he upon the application for certiorari, the portions of the court’s order relating to these matters are quashed. Petitions for mandamus and prohibition are denied. As to all other matters the appeal is dismissed as premature.

      These suits were filed November 23, 1966, which was subsequent to the filing of this action by Nelson, but before the original appeal was submitted in this court.

      For a discussion of the use of the writ in Arkansas, see Bryant, “Certiorari in Arkansas” 17 Ark. L. R. 163.

      Although this court has been very liberal in construing and applying Article XVI, §13, of our constitution permitting taxpayers’ action, we cannot approve any requirement that the state be called upon to bear the expense of preparation and trial of these actions.


author: J. Fred Jones, Justice.

text:
    Shanon D. Bridges, et al v. United Savings Association
    5-4732
    438 S.W. 2d 303
    Opinion Delivered February 24, 1969
    [Rehearing denied April 7, 1969.]

      Bothell, Stocks, Callaway & King for appellant.

      Bill B. Wiggins for cross-appellant.

      Warner, Warner, Rag on & Smith for appellee.
   J. Fred Jones, Justice.

This is an appeal by Shanon D. Bridges and a cross-appeal by Sam Sexton, Jr. from a decree of the Sebastian County Chancery Court in -which a joint and several deficiency judgment was awarded in favor of United Savings Association in a mortgage foreclosure against Bridges and Sexton. Bridges satisfied the judgment and was awarded judgment over against Sexton on a cross-complaint. The facts of record appear as follows:

On October 1, 1964, Bridges and a Mr. "Wilson, together with their wives, borrowed $12,600.00 from United Savings Association of Fort Smith. The loan was evidenced by a promissory note bearing interest at six per cent and payable in equal monthly installments of $81.19 each. The note was secured by a mortgage on a new house and lot with an appraised value of $14,-000.00. Bridges and Wilson placed $1,400.00 of the amount borrowed into savings accounts with United and pledged these accounts to United as collateral security for the loan until such time as the principal loan balance should be reduced to $10,500.00. This collateral secur ity enabled Bridges and Wilson to borrow 90% of the appraised value of the house and lo.t rather than the customary 80% of appraised value.

On December 25, 1964, Sam Sexton, Jr. signed an offer to purchase the property for a purchase price of $12,900.00; $300.00 to be paid in cash and the loan to be assumed for the balance of $12,600.00. On January 8, 1965, Sam Sexton, Jr. did purchase the property from Bridges and Wilson. He paid $300.00 in cash and took title by warranty deed containing the following provisions :

“This conveyance made subject to a Mortgage in favor of United Savings Association of Fort Smith, Arkansas as recorded in Record Book 83, Page 519, filed October 9, 1964, for an original sum of $12,600.00, which there is an unpaid balance of $12,563.53, which the grantee herein assumes and agrees to pay.”

Also on January 8, 1965, Sexton signed a separate “assumption of indebtedness” form, agreeing to make the payments on the mortgage indebtedness to United. After a few months Sexton defaulted in the payments to United resulting in the foreclosure action against Bridges, Wilson and Sexton. Bridges cross-complained seeking judgment over against Sexton for any judgment which United might recover against him and Sexton cross-complained against Bridges alleging that the sale to him was induced by fraud and that the collateral pledge should be applied first to any deficiency.

Wilson assigned his interest in the savings accounts to Bridges and the chancellor rendered a decree of foreclosure in favor of United for the full amount of the indebtedness and decreed that the real property be first sold and the proceeds applied on payment of the mortgage indebtedness; that the savings accounts pledged as security be next applied on the mortgage indebtedness with joint and several judgment against Bridges and Sexton for any deficiency. The chancellor also decreed judgment over in favor of Bridges against Sexton for any amount Bridges should be required to pay in excess of the proceeds from the sale of the real property and after application of the savings accounts under the collateral pledge.

Bridges purchased the property at foreclosure sale for $11,000.00 and after crediting this amount, together with the pledged savings accounts, to the mortgage indebtedness, attorney’s fee and court costs, a deficiency judgment was decreed against Bridges and Sexton in the amount of $2,078.41. The final decree for deficiency judgment then recites:

“It further appearing to the court that the defendants, Shanon I). Bridges and Helen L. Bridges, have paid in full the above set out deficiency amount of $2,078.41 and are entitled to a judgment over against the defendant, Sam Sexton, Jr., for said amount, all in accordance with the foreclosure decree heretofore filed herein.
IT IS FURTHER CONSIDERED, ORDERED, ADJUDGED AND DECREED that defendants, Shanon D. Bridges and Helen L. Bridges, do have and recover of and from the defendant, Sam Sexton, Jr., the sum of $2,078.41, with interest thereon at the rate of 6% per annum from December 27, 1967.”

On direct appeal Bridges relies on the following points for reversal:

“The chancellor erred as a matter of law in failing to grant Shanon D. Bridges, et ux, judgment against Sam Sexton, Jr., for the amount of the Bridges savings deposits utilized to satisfy the obligation assumed by Mr. Sexton.
The findings of fact of the chancellor are sustained by the overwhelming weight of the evidence. ’ ’

On cross-appeal Sexton relies on the following points:

“The device employed by Bridges and United Savings to accomplish the sale of the property constituted ‘constructive fraud.’
The remedy in a fraud action of this type is lo off-set damages against a claim for purchase price.”

Wo are forced to the conclusion that the appellant is correct in his contention. There were actually two separate transactions involved in this case. The first transaction was between the Bridges and the Wilsons on one side and the United Savings on the other. The second transaction was between the Bridges and the Wilsons on one side and Sexton on.the other. In the first transaction the Bridges and Wilsons gave a mortgage on their real property to secure the payment of a loan made to them by United. In addition to the mortgage on their real estate, they pledged their savings accounts to United as additional security for the loan.

In the second transaction Sexton purchased the mortgaged property from the Bridges and the Wilsons for the sum of $12,900.00. He paid $300.00 in cash and agreed to pay the balance of $12,600.00 by assumption of the mortgage indebtedness, payable in monthly installments of $81.19 each. Sexton only purchased the real property from the Bridges and the Wilsons. He did not purchase, nor does he claim any interest in, the savings accounts which the Bridges and the Wilsons pledged as additional security for their loan. Sexton gave no collateral security when he purchased the property, but only paid $300.00 cash and purchased the property subject to the real estate mortgage indebtedness of $12,600.00 which lie agreed to pay. Assuming that the Bridges and the Wilsons had mortgaged their automobiles and furniture and their children had pledged their separate savings accounts as collateral security for their loan, such additional mortgages and pledges would not secure Sexton against a deficiency judgment on his own obligation under his separate contract, especially in the absence of fraud in its inducement.

We now come to Sexton’s cross-appeal. We are of the opinion that the chancellor’s finding, that the sale of the property to Sexton was not induced by fraud, is not against the preponderance of the evidence. It was candidly admitted by Bridges and United that the savings accounts in the amount of $1,400.00, pledged as collateral security by the Bridges and the Wilsons, came out of the $12,600.(10 they borrowed from United and that United never did part with the possession of $1,400.00 of this loan at all. The question naturally arises as to whether the Bridges and the Wilsons actually borrowed $12,600.00 for which the note and mortgage were given, or whether the loan was actually for $12,600.00 less the $1,400.00 retained by United and placed in savings accounts in the name of Bridges and Wilson as additional security, but which remained in the possession and undei the control of United at all times. Bridges and United contend that this procedure was followed for the benefit of a prospective purchaser of the mortgaged property, as well as for the benefit of the owner and original borrower. They contend that this procedure would enable the owner to sell the property with practically no down payment and with a built-in loan already financed. Sexton argues, with convincing logic, that this procedure is a built-in device which .-enables the original mortgagor owner to sell property to an unsuspecting purchaser for its full market value, while leaving the impression with the purchaser that he is purchasing the property at a distress sale for a mere pittance of its actual value, for only the balance due on the original purchase price, and for much less than was originally paid for the property.

Assuming that either, or both, arguments are cor-a’ect, the question remains as to whether fraud was practiced on Sexton in this case. The question of usury is not raised in this case nor does Sexton seek cancellation of his contract because of fraud. The question is whether Sexton is somehow entitled to the benefit of Bridges’ collateral security because of constructive or legal fraud perpetrated on Sexton. In Arkansas Valley Compress & Warehouse Co. v. Morgan, 217 Ark. 161, 229 S.W. 2d 133, we said:

“... [Constructive fraud ... has been stated to consist of certain elements. In Levinson v. Treadway, 190 Ark. 201, 78 S.W. 2d 59, Mr. Justice Mehaffy said:
‘Persons, in order to be guilty of legal or constructive fraud, or, as it is sometimes called, fraud at law, do not necessarily have to be guilty of moral wrong, but a constructive fraud is a breach of either legal or equitable duty which, irrespective of moral guilt of the fraud feasor, the law declares fraudulent, because of its tendency to deceive others, to violate public or private confidence, or injure public interests. Neither actual dishonesty of purpose nor intent to deceive, is an essential element of constructive fraud. 26 C.J. 1016 and cases cited.’
Bouvier’s Law Dictionary says: ‘Legal or constructive fraud includes such contracts or acts as, though not originating in any actual evil design or contrivance to perpetrate a fraud, yet by their tendency to deceive or mislead others, or to violate private or public confidence, are prohibited by law.’
In Hildebrand v. Graves, 169 Ark. 210, 275 S.W. 524, Mr. Justice Hart pointed out that in determining the question of fraud, all the surrounding circumstances are to be considered.” •

In 37 C.J.S., Fraud, §§ 15 and 16, p. 242, is found the following:

“The concealment of a material fact may be equivalent to a false representation and be sufficient upon which to predicate a charge of fraud; (citing National Life & Accident Ins. Co. v. Hitt, 194 Ark. 691, 109 S.W. 2d 426) however, mere silence is not representation and in the absence of a duty to speak... silence as to a material fact does not of itself constitute fraud, although one who, instead of merely remaining silent, misrepresents or takes steps to conceal material facts, or who says or does something to avert inquiry, is guilty of fraudulent concealment...
Where the parties deal at arm’s length, there is no duty of disclosure where the facts are equally within the means of knowledge of both parties. If a fact is peculiarly within the knowledge of one party and of such a nature that the other party is justified in assuming its nonexistence, there is a duty of disclosure.”

In National Life, & Accident Ins. Co. v. Hitt, 194 Ark. 691, 109 S.W. 2d 426, is found the following:

“As was said in Sanders v. Berry, 139 Ark. 447, 214 S.W. 58, 'The law requires good faith in every business transaction, and does not allow one party to intentionally deceive another by making false representations or by concealment.’ In Lone Rock Bank v. Pipkin, 169 Ark. 491, 276 S.W. 588, we said: 'If the means of information as to the matters represented is equally accessible to both parties, they will be presumed to have informed themselves; and, if thejr have not done so, they must abide the consequences of their own carelessness.”

In Lane v. Rachel, 239 Ark. 400, 389 S.W. 2d 621, is found the following:

“It is well settled tliat representations are construed to be fraudulent when made by one who either knows the assurances to be false or else not knowing the verity asserts them to be true. Fausett & Co. v. Bullard, 217 Ark. 176, 229 S.W. 2d 490; Maurice v. Chaffin, 219 Ark. 273, 241 S.W. 2d 257. In C.J.S., Fraud, § 2, p. 211, constructive fraud is succinctly defined as ‘breach of legal or equitable duty which, irrespective of the moral guilt of the fraud feasor, the law declares fraudulent because of its tendency to deceive others * * * Neither actual dishonesty of purpose, nor intent to deceive is an essential element of constructive fraud.’ ”

Fraud is never presumed but must be affirmatively proven by the one who alleges it and by testimony which is clear and convincing. Green v. Bush, 203 Ark. 883, 159 S.W. 2d 458; Ellis v. Ellis, 220 Ark. 636, 246 S.W. 2d 302; First National Bank v. Peoples National Bank, 97 Ark. 15, 132 S.W. 1008; Sledge and Norfleet Co. v. Mann, 193 Ark. 884, 103 S.W. 2d 630.

The chancellor found that the circumstances surrounding the loan transactions in this case did not amount to constructive or legal fraud. We cannot say that his findings are against the preponderance of the evidence. There is nothing in the record before us that would indicate that the property was over appraised at ‡14,000.00 when the original loan was made, and there is no evidence that anyone even suggested to Sexton that the property was worth more than that amount or more than the amount he agreed to pay for it. There is no contention here that the property was over appraised; the contention of Sexton is that it was over financed. The property was financed at 90% of its appraised value rather than 80% and this could have been to Sexton’s advantage as well as to his detriment.

Sexton was chairman of the board of a loan association, and was generally familiar with loan transactions in the Fort Smith area. He knew from his personal knowledge and experience that the standard real estate loan did not exceed 80% of the appraised value of the property. The evidence clearly suggests that Sexton thought he was purchasing at least a 20% of $1,400.00 equity value in a new house and lot for a cash payment of $300.00, when as a matter of fact he only purchased a 10% or $700.00 equity value for $300.00. The record is clear that Sexton acted on his own knowledge and experience, rather than on representations, statements or inducements made by United or Bridges, or their agent.

The decree of the chancellor is reversed and this cause is remanded for the entry of a decree in favor of Bridges against Sexton for the full balance due on Sexton’s obligation after crediting the amount received for the property at the foreclosure sale.

Reversed and remanded.