text:
    McILROY BANK & TRUST, Fayetteville, Arkansas v. THE FEDERAL LAND BANK OF ST. LOUIS
    79-70
    585 S.W. 2d 947
    Opinion delivered September 10, 1979
    (Division II)

      McAllister, Wade, Burke & Eldridge, P.A., by: John R. Eldridge, III, for appellant.

      Pearson & Woodruff, by: C. Thomas Pearson, Jr. and Priscilla Karen Pope, for appellee.
   John I. Purtle, Justice.

This is a mortgage foreclosure on a grade A dairy farm and the appurtenances and equipment. The Federal Land Bank and the owners negotiated a loan and first mortgage on the property. Subsequently, the owners executed another mortgage as well as a financing statement and security agreement to McIlroy Bank & Trust. Both the mortgages and the financing statement were duly recorded. McIlroy claimed a superior lien under the Uniform Commercial Code to the equipment or fixtures mentioned in its agreement. The court held in favor of the Federal Land Bank by declaring all of the appurtenances and fixtures mentioned in both instruments to be a part of the realty. McIlroy appeals.

We are called upon to determine whether certain items of dairy equipment were fixtures and subject to a real estate mortgage or whether they were personalty and subject to the Uniform Commercial Code. We are of the opinion that under the circumstances present in this case the items in dispute became a part of the realty.

On February 4, 1976, the Suttons executed and delivered to the Federal Land Bank of St. Louis a real estate mortgage as security for payment of a promissory note. This mortgage was filed on February 10, 1976. It was reexecuted and refiled on September 28, 1976. December 8, 1976, the Suttons gave a second mortgage to McIlroy Bank & Trust Company to secure an indebtedness of $100,000. This mortgage was recorded on December 17, 1976. Additionally, McIlroy secured from the Suttons a financing statement and security agreement which extended to various items of dairy equipment mentioned in the instrument. The financing statement and security agreement were filed on October 27, 1977.

The Suttons defaulted on both transactions and Mcll-roy took possession of the milking equipment and began to negotiate a sale for the balance of the dairy equipment. The Federal Land Bank obtained an injunction until the matter could be decided by the court.

The mortgage from the Suttons to the Federal Land Bank contained the following language:

. . . together with all rights, interest, privileges, easements and appurtenances thereunto appertaining, and the rents, issues and profits thereof, and together with all improvements and fixtures now or hereafter erected thereon, including all heating, air conditioning, lighting, plumbing and water supply apparatus, storm windows and doors, window screens, screen doors, window shades, awnings, locks, fences, including gates, trees, shrubs and such other fixtures and improvements used or useful in the operation of the premises ....

The mortgage to McIlroy described the same real estate and listed items of equipment which were being used at the dairy barn. The evidence shows that most, if not all, of the equipment was attached to other equipment through refrigeration lines or water or milk lines. Most of it was inside the barn but portions were affixed to concrete slabs outside the barn with connecting pipes to other equipment inside the barn. Appellant sold part of the equipment to a man who described the manner in which he took possession of it. For the most part, he used a hammer, wrench, or screwdriver, to detach the various items for removal purposes. After removal several holes were left in the side of the barn where equipment had been extended through the walls.

During the trial of the case the purchaser of the equipment was asked whether or not “customarily dairymen in the area remove equipment from their barn.” Although the witness answered in the affirmative, the court sustained the objection by the appellee. Appellant contends it was proper to ask such question, especially in view of the fact that this witness had been examined on methods of installing equipment in a dairy barn. Appellant argued this answer would have a bearing on the intent of the Suttons in affixing the equipment in place. The court, in holding in favor of the Federal Land Bank, relied heavily upon Alwes v. Richheimer, 185 Ark. 535, 47 S.W. 2d 1084 (1932).

We agree that the court properly relied upon Alwes, supra. As was stated in Choate v. Kimball, 56 Ark. 55, 19 S.W. 108 (1892), the test for determining whether items are fixtures is: (1) whether the items are annexed to the realty; (2) whether the items are appropriate and adapted to the use or purpose of that part of the realty to which the items are connected; and (3) whether the party making the annexation intended to make it permanent. Over the years our rule has not substantially changed. It is undisputed that practically all of the items were annexed to the realty although it may have been very minimal in some instances. Neither is it disputed that all of the items were appropriate for and used in the operation of a grade A dairy farm. The third test as to whether the parties intended to make the equipment permanent is not as easily determined. The Suttons did not testify. A representative of the Federal Land Bank, one of the parties to the original transaction, testified that the items were in place at the time of the mortgage and he made a note that the property was being operated as a grade A dairy. When you consider the language in the appellee’s mortgage it is quite clear that it is at least as broad as the language in Alwes, supra. Therefore, this equipment could easily become fixtures. There is no evidence in the record that these items were attached to the realty on a temporary basis or that they were held for resale or that the Suttons intended to remove the equipment if they should move or cease operation. Under these facts here in question we feel the third test has been met and the equipment became permanent fixtures. In fact, this equipment was suitable for no other purpose than to use in the operation of a dairy farm.

Although the objection was sustained as it related to the question of whether or not owners customarily removed this type of equipment from the premises, the answer was, nevertheless, included in the record. As was stated in Triumph Electric Co. v. Patterson, 211 F. 244 (C.C.A. 8th Cir. 1914):

The general rule is that the lien of a mortgage of realty embraces whatever is annexed to the land in such manner as to become, in contemplation of law, part and parcel thereof. This includes not alone buildings and structure, but likewise machinery which forms an integral part of the same, and is designed, adapted and intended for permanent use therein, with a view to the purpose for which they are employed. This is true in the absence of special local custom to the contrary, although such machinery may be susceptible of removal and installation elsewhere, and although in the structure other similar machinery might be substituted for it.

Whether or not the owner of the equipment, after attaching it to realty, subsequently decided to remove it is not the controlling factor. One might remove a porch from his residence although it was built for the purpose of serving the residence. Many houses are placed upon land by the use of blocks or pillars and it is not a great problem to remove the entire house with modern equipment. Nevertheless, there can be no question but that the house or porch was attached and became part of the realty.

For the reasons above stated, we feel the judgment of the trial court should be affirmed.

Affirmed.

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


source: Caselaw Access Project

author: PER CURIAM

license: Public Domain

text:
    Edward Charles PICKENS a/k/a Larry COAKLEY v. STATE of Arkansas
    CR 76-186
    586 S.W. 2d 1
    September 10, 1979
   PER CURIAM

Petitioner was convicted of capital felony murder and sentenced to death by electrocution. We affirmed, Pickens v. State, 261 Ark. 756, 551 S.W. 2d 212 (1977), and the Supreme Court of the United States denied certiorari, 435 U.S. 909 (1978). The mandate received from the Supreme Court was the last docket entry in this court before the filing of the present “Petition for Trial Records.”

Since petitioner’s pro se petition for a copy of or use of his trial transcript is not attached to or incorporated into a petition for postconviction relief pursuant to Criminal Procedure Rule 37, his petition is denied; however, petitioner may reapply to this court for a copy of his transcript upon the filing of a petition for postconviction relief. See Chavez v. Sigler, 438 F. 2d 890 (8th Cir. 1971).

Petition denied.


author: John A. Fogleman, Justice.

text:
    Allen Frank DAVIS v. James MABRY, Director, Arkansas Department of Corrections, et al
    79-66
    585 S.W. 2d 949
    Opinion delivered September 17, 1979
    (In Banc)

      Charles S. Gibson, for appellant.

      Sieve Clark, Atty. Gen., by: Dennis R. Moloch, Asst. Atty. Gen., for appellee.
   John A. Fogleman, Justice.

Allen Frank Davis filed his petition for declaratory judgment and mandamus to the Director of the Arkansas Department of Corrections and the members of the Arkansas Parole Board. He asserted that they had wrongfully refused to consider him for parole because they had been advised by the Attorney General that he was ineligible. The trial court denied the writ and rendered a declaratory judgment that appellant was ineligible for parole. We disagree and reverse the judgment.

The following facts were stipulated:

That the Plaintiff was arrested, incarcerated in the Garland County Jail and charged with First Degree Murder on January 19, 1967, and the following sequence of events occurred on the date so indicated with respect to the criminal prosecution in the Circuit Court of Garland County, Arkansas, in the matter styled “State of Arkansas v. Allen Frank Davis, No. 12,827”:,
January 30, 1967 Plaintiff admitted to Arkansas State Hospital for observation
June 21, 1967 Plaintiff returned to Garland County Jail
February 8, 1968 Re-admitted under Court Order to Arkansas State Hospital
April 15, 1968 Plaintiff returned to Garland County jail
June 17, 1968 Plaintiff sentenced to death
June 18, 1968 Plaintiff committed to Arkansas Department of Correction
December 29, 1970 Plaintiff’s sentence commuted to life imprisonment by executive clemency;
That the Plaintiff has served in excess of fifteen years of which Plaintiff’s credit for good time allowances does not exceed five years as contemplated by Ark. Stat. 43-2807(b)(2). (This is not a Stipulation that the cited Statute applies, only that if it does that Plaintiff has satisfied its requirements for parole eligibility).

The trial court held that the commutation of appellant’s sentence was in effect a new sentence and that his parole eligibility must be determined by the law in effect at the time of the commutation — Act 48 of 1969, as amended by Act 94 of 1969. The amended act is digested as Ark. Stat. Ann. § 43-2807 (b) (Repl. 1977).

Appellant relies upon State ex rel Murphy v. Wolfer, Warden, 127 Minn. 102, 148 N.W. 896 (1914). The pertinent language from that opinion is:

*** It is well settled that a commutation of a sentence is a substitution of a less for a greater punishment. After commutation the commuted sentence is the only one in existence, and the only one to be considered. After commutation, the sentence has the same legal effect, and the status of the prisoner is the same, as though the sentence had originally been for the commuted term. Johnson v. State, (Ala.) 63 South. 163; In re Hall, 34 Neb. 206, 209, 51 N.W. 750, 5 Op. of Attys. Gen. (U.S.) 370); Lee v. Murphy, 22 Grat. (Va.) 789, 799, 12 Am. Rep. 563. . .”

Appellees agree with appellant as to the effect of the commutation on the sentence, citing, among others, Scharff v. Tennessee, 551 S.W. 2d 671 (Tenn. 1977); Ex Parte Enriquez, 490 S.W. 2d 546 (Tex. Cr. App. 1973); Bowen v. Tennessee, 488 S.W. 2d 373 (Tenn. 1972); In re Hall, 34 Neb. 206, 51 N.W. 750 (1892); cf. In re McMahon, 125 N.C. 38, 34 S.E. 193 (1899). We feel that the trial court erred as to the effect of the commutation. Although we have never passed upon this particular question, we have held that there is no good reason why the rule that a pardon must be construed most strongly against the state and most beneficially for the convicted person should not be applied to a commutation of sentence. Williams v. Brents, 171 Ark. 367, 284 S.W. 56. Such a construction requires that we follow the holdings of the courts of Minnesota, Tennessee and Texas as to the effect of the commutation of sentence.

The statute governing parole when appellant was sentenced on June 17, 1968, was Act 50 of 1968. Section 28 of that act provided that individuals thereafter sentenced to life imprisonment should be eligible for release on parole after having served 15 years of the sentence, with credit for good time allowances not exceeding 5 years. Appellees concede that, had the trial court found that the commuted sentenced related back to the date of the original sentence, and then applied Act 48 of 1969, as amended by Act 94 of 1969, the special provision digested as Ark. Stat. Ann. § 43-2807 (b) (2) would apply and appellant would be eligible for parole after having served 15 years of the sentence, with credit for good time not to exceed 5 years. Appellees contend, however, that appellant has suffered no prejudice by reason of the trial court’s holding because his parole eligibility was governed by Act 93 of 1977, which was in effect at the time he sought consideration for parole.

We cannot agree with appellees. Act 93 of 1977 provides that eligibility for release on parole of persons who committed felonies prior to April 1, 1977, shall be determined in accordance with the parole eligibility law in effect at the time the crime was committed. The law in effect at the time of the commission of the crime of which appellant was convicted was Act 275 of 1953. Section 2 of that act (digested as Ark. Stat. Ann. § 43-2823 [Repl. 1964]) provides that no convict confined in the penitentiary is eligible for parole until he has served one-third of the timé for which he was committed or of the time to which it has been commuted. Appellees reason that appellant was not prejudiced by the trial court’s holding, because he will not be entitled to consideration for parole until his sentence has been commuted to a term of years.

Appellant has not specifically responded to this argument of appellees. It probably was not made in the trial court, although we cannot be certain about this. Appellant did, however, advance the argument that manifold problems in the area of ex post facto legislation would be encountered if parole laws at the time of commutation are applied rather than those existing at the time of sentencing. There is no doubt that a parole statute less favorable to one who had been sentenced prior to its passage than the parole law existing at the time of his sentencing would be unconstitutional as an ex post facto law, in violation of Art. 2, § 17 of the Constitution of Arkansas. In that respect, we agree with the Supreme Court of Louisiana, which, relying upon Ex parte Medley, 134 U.S. 160, 10 S. Ct. 384, 33 L. Ed. 835 (1890), held that a change in parole statutes after the sentencing of one convicted of a crime which altered his situation to his disadvantage could not be relied upon to deprive him of the privilege of being considered for parole on the basis of the law at the time of his sentencing. The Louisiana court held that to do so would violate constitutional inhibitions against ex post facto laws. State ex rel Woodward v. Board of Parole, 155 La. 699, 99 So. 534 (1924). Act 93 of 1977 obviously is less favorable to appellant than the statute in effect on the date he was sentenced, and application of it rather than the statute in effect when appellant was sentenced would operate seriously to his disadvantage. We hold that the parole law which governed one under sentence to life imprisonment on the date appellant was sentenced to death is the statute to be applied to appellant’s application for parole, if the application of a later statute would operate seriously to his disadvantage, as Act 93 of 1977 would, in this case. The fact that Davis is entitled to consideration for parole does not mean that he is entitled to parole.

The judgment of the trial court is reversed with directions to enter a judgment consistent with this opinion directing appellees to give consideration to appellant’s application for parole.

Mr. Justice Holt did not participate.


author: Conley Byrd, Justice.

text:
    M. E. RATLIFF v. BANK OF NEW ORLEANS AND TRUST COMPANY and John Hampden LEWIS, Trustee
    79-67
    586 S.W. 2d 237
    Opinion delivered September 17, 1979
    (Division II)

      David Solomon, for appellant.

      Jake Brick, for appellees.
   Conley Byrd, Justice.

Appellant sought to set aside a mortgage he had executed on Waverly Plantation to the appellee Bank of New Orleans and Trust Company for $1 ,- 200,000.00 on the basis of mutual mistake and fraud. The trial court in holding against appellant’s contentions stated:

“At the time of the sale, Allen Thompson knew that there were not 2,300 and some acres in Waverly. I almost feel that M. E. Ratliff knew that there were not 2,300 and some acres in Waverly. There is question about Insley Bar being in Tennessee or Arkansas, but the plat shows that part of it certainly is in Tennessee. The Defendant stated that he had the plat prior to the sale so he is charged with notice of this. And if the Vendee knows the amount of land he is purchasing, he has no right to rely upon the representation of the Vendor as to the quantity of the land. W. D. George, upon questioning by the court, stated that Mr. Lewis told Mr. Ratliff that there were not 2,400 acres but only 1,900 acres of which 1,500 acres were cultivatable. Due to Mr. Martin’s testimony the Defendant Ratliff was put on notice that there were only 1,543 acres in the farm in January. On March 15, Mr. Ratliff executed a lease agreement for an additional year, entering into a two-year lease on the property which results in an inconsistent position. The law precludes one who accepts the benefits from repudiating the resulting obligation. Further, the Defendant, Ratliff, entered into agreements for the sale of Waverly on more than one occasion which would have resulted in some $50,000.00 profit. Courts have held that leasing of property by the purchaser who holds a right to rescind, constitutes a waiver of that right. Therefore, the lease to Looney Brothers granting them an Option with knowledge of the deficiency of the acreage amount to a waiver of the right of rescission.”

Based upon an appraisal of C. V. Dodd showing that Waverly Plantation consisted of 2349 acres the Bank of New Orleans had taken a mortgage to secure an indebtedness of Allen Thompson in the amount of $1,050,000. Thompson had other indebtedness with the Bank of New Orleans including two outstandings letters of credit totalling $220,000. In October of 1976, Thompson, who was not meeting his obligation with the Bank of New Orleans on his Waverly Plantation note, contacted appellant Ratliff about the purchase of Waverly Plantation. Ratliff was given a copy of a “quad” map covering parts of Tennessee and Arkansas with a shaded area encompassed by a pink border with the words “Waverly Plantation approx. 2300 M/L” printed thereon in large letters.

Ratliff testified that Thompson told him there were 1500 acres in cultivation and another 400 acres that could be put in cultivation making a total of 1900 acres of cultivated land. Thompson at the same time agreed to make the financing arrangements with the Bank of New Orleans subject to a $600,000 mortgage in favor of Prudential Insurance Company. After Thompson and Ratliff reached an agreed price of $1,900,000, Thompson contacted John Hampden Lewis, Vice President of the Bank of New Orleans who came to Memphis to investigate the proposed sale to Ratliff.

The parties have a difference about what Lewis said while in Memphis. Ratliff says that Lewis represented Waverly Plantation to consist of 2400 acres, 1900 of which was cultivatable — i.e., 1500 in cultivation and 400 that could be cleared. Bill George, who shares offices with Ratliff testified that Lewis stated he understood that farm to contain 2400 acres with 1500 acres in cultivation and another 400 that could be cleared. However, Bill George had originally understood from Thompson that there were 1000 acres of cotton and 900 acres of beans in cultivation. John Hampden Lewis testified that he did not discuss the number of acres involved.

John Hampden Lewis testified that he was furnished a financial statement by Ratliff showing net assets in excess of four million dollars. Ratliff denies that he furnished such a statement. However, the record contains such a financial statement admittedly containing Ratliff’s signature.

The record shows that Ratliff and Thompson together with their lawyer Hal Freeland showed up at the Bank of New Orleans on November 12, 1976, to close the transaction. The Bank of New Orleans refused to make Ratliff a $1,200,000 loan subject to the Prudential Mortgage without a down payment of $125,000. Ratliff proposed to pledge some German 1925 series bonds as security but the Bank of New Orleans refused. In late November John Hampden Lewis flew to Memphis and contacted Mr. George Long, an independent real estate appraiser to determine the value of Waverly Plantation for purposes of a quick sale. Long apparently contacted Lewis by phone on December 3, 1976, and gave Lewis the following information as per Defendant’s Exhibit “B” to wit:

12-3-76
$1,250,000.00
1,000 Acres North of Levee, protected land 840 acres, very good land
600 Acres South and East of Levee, 168 acres of farmable land
250 Acres 61 acres on both sides of levee 302 of timberland
1,031,050 1,371 Total Acres plus vast amount of acreage on Sandbars — and subject to arguments as to ownership (800 acres).

On December 6,1976, the matter was closed at the Bank of New Orleans with the delivery of a certified check in the amount of $111,632.49 and the Bank’s acceptance of the $1,200,000 note and mortgage originally executed by Ratliff on November 12, 1976.

Following the closing on December 6, 1976, Ratliff contacted Joe E. Martin with the Federal Land Bank in January and was informed that there was only 1,543 acres in Waverly Plantation which included only 909 acres of cropland.

Joe Looney contacted Ratliff with reference to leasing the property before March 1977 and informed Ratliff that there was not 1500 acres in cultivation. Looney Brothers Farms, a partnership, had farmed Waverly Plantation from 1956 through 1978 except for three years.

Notwithstanding the foregoing information, Ratliff made two advanced quarterly interest payments in the amount of $24,266.70 each in March and June 1977. Ratliff also entered into a two year lease agreement with the Looney Brothers Farms containing an option to purchase and pledged the two year rent agreement to the Forrest City Production Credit Association for $100,000 loan.

Ratliff’s cross-complaint against Thompson was dismissed without prejudice.

Like the trial court, after viewing the “quad” map (Defendant’s Exhibit “R”) we have some question about whether appellant Ratliff was justified in asserting that Waverly Plantation consisted of 2300 acres. He would certainly have been put on notice as early as his first discussion with the Federal Land Bank’s agent that that much acreage did not exist. Instead of acting promptly, however, he made two quarterly advance payments of interest to the bank in March and June of 1977 and entered into the two year lease with Looney Brothers Farm containing an option to purchase and by which he secured $100,000 from the Forrest City Production Credit Association. Thus as we view the facts, Ratliff by accepting the benefits of the bargain is estopped to demand rescission against the Bank of New Orleans. As pointed out in McCormick v. Daggett, 162 Ark. 16, 257 S.W. 358 (1924):

“It is clear that McCormick is not now entitled to rescind the contract. One who claims to have been deceived is required, as soon as he learns the truth, to disaffirm the contract with all reasonable diligence, so that both of the parties may, as nearly as possible, be restored to their original position. ‘He is not,’ says Pomeroy, ‘allowed to go on and derive all possible benefits from the transaction and then claim to be relieved from his own obligations by a rescission or a refusal to perform on his own part. If after discovering the untruth of the representations, he conducts himself with reference to the transaction as though it were still subsisting and binding, he thereby waives all benefit of and relief from the misrepresentations.’ Pomeroy’s Equity Jurisprudence (4th ed.) Vol. 2, § 897.”

To avoid the foregoing law with respect to the necessity of prompt action by one claiming rescission, appellant relies upon First National Bank of Wynne v. Coffin, 184 Ark. 396, 42 S.W. 2d 402 (1931). That case is distinguishable from the facts before us because there the First National Bank of Wynne undertook to remedy the deficiency in its deed and persuaded Coffin to give them time to get an act through the General Assembly of the State of Arkansas. In other words the First National Bank of Wynne by its conduct caused the delay. Here no such conduct can be laid at the feet of the Bank of New Orleans.

Affirmed.

We agree: Harris, C.J., and Holt and Purtle, JJ.


author: Frank Holt, Justice.

text:
    ARKANSAS STATE HIGHWAY COMMISSION v. Lester WRIGHT et ux
    79-74
    585 S.W. 2d 955
    Opinion delivered September 17, 1979
    (In Banc)

      Thomas B. Keys and Philip N. Gowen, for appellant.

      Ernie E. Wright, for appellees.
   Frank Holt, Justice.

In this eminent domain proceeding, the appellant acquired fee title to .36 acres of a three acre tract of commercial real estate land from the appellees. The jury awarded $20,000 as just compensation.

Appellant first contends that the court erred in permitting appellees’ expert witness, Evans, to testify to severance damages after testifying to the market value of the part taken. Appellant argues that the proper measure of damages in eminent domain cases in which a partial taking is involved is the difference in the market value of the whole property before the taking and the value after the taking less any enhancement to the remainder, citing Young v. Arkansas State Highway Commission, 242 Ark. 812, 415 S.W. 2d 575 (1967). We need not reach the merits of this argument since it is well established that when part of a witness’ testimony is admissible, it is proper for the court to refuse, as here, a motion to strike the witness’ entire testimony. Urban Renewal Agency of Harrison v. Hefley, 237 Ark. 39, 371 S.W. 2d 141 (1963); Young v. Arkansas State Highway Commission, supra; and Arkansas State Highway Commission v. Maus, 245 Ark. 357, 432 S.W. 2d 748 (1968). Here appellees’ value witness, Evans, admittedly an expert witness, testified on direct examination that the value of the land taken was $23,500. Over appellant’s objection, however, he was also permitted to testify that the remaining property suffered $6,000 in severance damages because of the taking. Evans’ testimony, as an expert witness as to the total value of the land taken, was unquestionably proper. Therefore the court properly refused to strike his testimony in its entirety.

Appellant next asserts that the court erred in permitting the testimony of appellees’ witness, Magness, to go to the jury and in overruling appellant’s motion for a mistrial. Again the appellant moved to strike this witness’ testimony in its entirety. This witness, as did Evans, testified as to the sale price of other properties in the vicinity of the condemned property. This testimony is admissible if it is shown, as here, that the pieces of property are similar or comparable to the condemned tract. Here Magness testified to the sale price of similar property he had purchased in the vicinity for his own use. This tract and the property being taken had “good easement drive off” and substantial highway frontage. His testimony of comparable sales in the vicinity was admissible. The court properly refused to strike his testimony in its entirety. Furthermore, any possible prejudice was removed when the court, by consent of the appellees, instructed the jury to disregard all of Magness’ testimony with reference to the value he placed on the lands taken or any just compensation to the appellees.

Affirmed.


text:
    Robert Lee WHITE v. STATE of Arkansas
    CR 78-200
    585 S.W. 2d 952
    Opinion delivered September 17, 1979
    (Division II)

      Mark W. Nichols, for appellant.

      Steve Clark, Atty. Gen., by: Catherine Anderson, Asst. Atty. Gen., for appellee.
   Frank Holt, Justice.

In accordance with a jury verdict, appellant was sentenced to life imprisonment for rape (see Ark. Stat. Ann. § 41-1803 [Repl. 1977]). 20 years for burglary (see Ark. Stat. Ann. § 41-2002 [Repl. 1977]), and 20 years for criminal attempt to commit first degree murder (see Ark. Stat. Ann. §§ 41-701, 41-703 and 41-1502 [Repl. 1977]). The sentences are to run consecutively.

Appellant first contends, through present counsel, that there is no substantial evidence to support the conviction of attempt to commit murder in the first degree. On appellate review, we affirm if there is any substantial evidence, when viewed most favorably to the appellee, to support the jury’s findings. Pope v. State, 262 Ark. 476, 557 S.W. 2d 887 (1977); and Merritt v. State, 258 Ark. 558, 528 S.W. 2d 365 (1975). § 41-701 provides:

A person attempts to commit an offense if he:
(b) purposely engages in conduct that constitutes a substantial step in a course of conduct intended to culminate in the commission of an offense whether or not the attendant circumstances are as he believes them to be.

§ 41-1502 provides:

(1) A person commits murder in the first degree if:
(a) acting alone or with one or more other persons, he commits or attempts to commit a felony, and in the course of and in the furtherance of the felony, or in immediate flight therefrom, he or an accomplice causes the death of any person under circumstances manifesting extreme indifference to the value of human life; or
(b) with the premeditated and deliberated purpose of causing the death of another person, he causes the death of any person.

Appellant argues that his conviction cannot be sustained under either subsection of § 41-1502 (1) in that the state did not prove premeditated and deliberated conduct as required under subsection (b), and that there is no “attempted felony murder rule in Arkansas” as codified in subsection (a). Appellee responds that the two subsections, however, are set forth in the alternative. Therefore first degree murder may be proven under either, and appellant attempted to commit murder as defined in section (1).

According to the Commentary, § 41-1502 (1) (a) “carries forward the felony murder doctrine. The Code provision differs from earlier law in that liability arises for a killing in the course of and in furtherance of any felony . . . . ” The intent to kill is immaterial. The scope of the statute has been limited only by a requirement that the death occur under “circumstances manifesting extreme indifference to the value of human life.” Appellant relies on pre-code cases in support of his assertion that the crime of attempted felony murder, as charged here, does not exist. However, in Stout v. State, 263 Ark. 355, 565 S.W. 2d 23 (1978), a case under the present code, there was, as here, no actual killing. We affirmed the life sentence of the accused for attempted capital murder of a police officer citing § 41-701 supra, combined with § 41-1501. It follows that sufficient proof of an attempt to kill a person as defined by §§ 41-701 and 41-1502 (1) (a) constitutes a criminal offense.

In the case at bar the evidence is amply substantial to support the conviction of criminal attempt to commit murder. At approximately 3 a.m., appellant entered the Ballance home through a window. Mrs. Ballance and her children were asleep in the living room. During the 30 to 40 minutes appellant was inside the house, he continuously threatened to kill members of the Ballance family. He periodically aimed his gun at various members and fired two shots at Mr. Ballance, barely missing him on both occasions. Mr. Ballance testified that one bullet “was close, just above my head. . . ” “[Y]ou could feel it.” Appellant, identified by the Ballances, then raped Mrs. Ballance. Certainly the jury could find that the shots constituted a “substantial step in a course of conduct intended to culminate in the commission of [the] offense” of murder “in the course of and in the furtherance of the” commission of the felonies of burglary and rape “under circumstances manifesting extreme indifference to the value of human life”. See §§ 41-701 and 41-1502 (1) (a). Appellant also argues that the shots were fired merely as warnings and that there were numerous opportunities to kill Mr. Ballance had that been his intent. It was for the jury to resolve any discrepancies, conflicts and inconsistencies in the testimony of the witnesses. Scott v. State, 254 Ark. 271, 492 S.W. 2d 902 (1973); and Stout v. State, supra.

Appellant also contends that there is no substantial evidence to support the conviction for burglary. He argues that the appellee failed to prove that he entered the house with the purpose of committing a felony. Ark. Stat. Ann. § 41-2002 (Repl. 1977) provides:

(1) A person commits burglary if he enters or remains unlawfully in an occupiable structure of another person with the purpose of committing therein any offense punishable by imprisonment.

The evidence previously recited is amply substantial to sustain the jury’s finding that appellant committed the offense of burglary.

Appellant’s next contention for reversal relates to the sufficiency of an instruction. The court instructed the jury in the statutory language which defines criminal attempt. § 41-701. Appellant argues that the court erred in failing to instruct the jury on the underlying offense of murder in the first degree. Appellant made only a general objection to the instruction. He stated no specific matter to which he objected nor the grounds for the objection. Neither did appellant proffer an instruction to which he now asserts he was entitled. Having failed to make a specific objection to the instruction given or to request an additional instruction, the issue cannot be raised for the first time on appeal. Bousquet v. State, 261 Ark. 263, 548 S.W. 2d 125 (1977).

Appellant next contends that he was denied the right of allocution which is accorded to him by Ark. Stat. Ann. § 43-2303 (Repl. 1977). It provides:

When the defendant appears for judgment.... he must be asked if he has any legal cause to show why judgment should not be pronounced against him.

In Rogers v. State, 265 Ark. 955, 582 S.W. 2d 7 (1979), we reiterated that the purpose of the statute was to give the accused, upon sentencing, an opportunity to show any cause why sentence should not be pronounced. Where a question is addressed to the defendant which affords him an opportunity to express why sentencing should not be pronounced, it is unnecessary that the precise language of the statute be used. Clark v. State, 264 Ark. 630, 573 S.W. 2d 622 (1978). Here, following the jury verdict, the court asked appellant, “Have you anything to say?” Appellant responded, “No, sir.” On appeal the appellant urges that he would have requested that the sentence be postponed on the ground that he was insane, and stated that he had been under the influence of drugs on the night of the crime, had he “been allowed to speak.” However, appellant was allowed to speak. Also appellant was present with counsel and no objection was raised to the procedure followed by the court. We have held that even in capital cases it is necessary to make an objection in the trial court in order to raise the issue on appeal. Hulsey v. State, 261 Ark. 449, 549 S.W. 2d 73 (1977), cert. den. 439 U.S. 882, 99 S. Ct. 220, 58 L. Ed. 194 (1978). Here, appellant has not demonstrated he was denied his right of allocution.

Affirmed.

We agree: Harris, C.J., and Byrd and Purtle, JJ.


author: Darrell Hickman, Justice.

text:
    Luke Edward DAVIS v. STATE of Arkansas
    CR 79-105
    585 S.W. 2d 956
    Opinion delivered September 17, 1979
    (Division I)

      John W. Achor, Public Defender, by: Howard W. Koopman, Deputy Public Defender, for appellant.

      Steve Clark, Atty. Gen., by: Alice Ann Burns, Asst. Atty. Gen., for appellee.
   Darrell Hickman, Justice.

Luke Edward Davis was convicted by a jury in the Pulaski County Circuit Court of aggravated robbery and sentenced as an habitual criminal to 30 years’ imprisonment.

On appeal he alleges one error: The trial court improperly admitted as evidence certain pre-trial statements made by Davis.

David Stockston was delivering cigarettes to vending machines at the East End Cafe in North Little Rock, Arkansas on September 26, 1978. He testified that as he was leaving, two men, one of whom had a gun, robbed him of his money bag. He identified Davis as one of the men.

Two North Little Rock policemen arrested Davis without a warrant at the East End Cafe about 1:30 p.m. on the 9th of October. They took Davis to the police station and, as they were taking him inside, saw Stockton, the victim, seated at the desk. Davis immediately said, “This is the man that thinks I robbed him,” walked over to Stockton and added, “Tell them I didn’t rob you.” The exact words varied according to the testimony of the officers and Stockton, but essentially the testimony was the same. Davis argues that these statements should have been excluded as evidence because they occurred during a “critical stage” of the legal proceedings when Davis was without legal counsel.

Davis cites as controlling the case of U.S. v. Wade, 388 U.S. 218 (1967). We disagree that the Wade case, or any other decisions, required the exclusion of the statements. First, there is no evidence that there was a line-up as there was in Wade; in fact, the appellant concedes that there is no evidence that the police intended for there to be a confrontation between the victim and the accused as it occurred. Stockton said he was asked to come to the station to sign a warrant. Next, Davis had been warned of his rights as required by Miranda v. Arizona, 384 U.S. 436 (1966).

The statements were simply spontaneous, and in the absence of any evidence of impropriety of the part of the police, they were properly admitted.

Affirmed.

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


author: John I. Purtle, Justice.

text:
    Larry Dewey TATUM v. STATE of Arkansas
    CR 79-48
    585 S.W. 2d 957
    Opinion delivered September 17, 1979
    (Division II)

      Jerry G. James, for appellant.

      Steve Clark, Atty. Gen., by: Robert J. DeGostin, Jr., Asst. Atty. Gen., for appellee.
   John I. Purtle, Justice.

Appellant was convicted of burglary in the Union Circuit Court on August 8, 1977, and > sentenced to a term of 30 years as a habitual criminal. It was stipulated he had three prior convictions. An in-custody confession by appellant was introduced over his objection, after a Denno hearing. Appellant did not testify at the trial.

It is argued on appeal that the confession was inadmissible because it was given 19 days after he had received the Miranda warning and upon the promise of a deputy sheriff that he would “do all he could to help him.” Appellant further contends that the evidence presented at the trial was insufficient to sustain a conviction.

We hold that the evidence was sufficient to sustain the conviction but that the admission of the confession constituted prejudicial error for which we must reverse.

The burglary occurred on April 25, 1977, in Strong, Arkansas. Information developed by the investigation led the officers to look for a white-over-red Monte Carlo automobile on the front of which was a license-type plate with the name “Larry” on it. May 2, 1977, appellant was apprehended while driving a vehicle meeting this general description. He consented to an inspection of the vehicle which revealed dents and scratches on it as well as paint chips being found in the trunk. The paint chips appeared to match the paint of the vehicle and the paint on a safe which had been taken in the burglary. The safe had been recovered near the scene and it had patches of paint missing.

Appellant was given a Miranda warning on May 2, 1977, at the time he was charged with the burglary. He elected to make no statement at that time and was released on bond the same date. Nineteen days later he was told by a deputy sheriff to come back to the office for further questioning. It was during this visit to the sheriff’s office, on May 21, 1977, that the sheriff’s deputy told him he would do all he could for him. Appellant then gave a taped confession which was subsequently transcribed and presented to the jury during the trial. He had been afforded a full Denno hearing prior to introduction of the statement. He also told the officer about the other two codefendants who were subsequently arrested. Both pleaded guilty and were sentenced to terms in the Arkansas Department of Correction at the Cummins Unit. The two accomplices testified against appellant at his trial.

Appellant’s girlfriend, with whom he was living at the time of the bruglary, stated he left home in the Monte Carlo on the night of the burglary and it was parked at the house the next morning in a damaged condition. He explained to his girlfriend that he had won some money and locked it up in the trunk and vandals broke into it to steal the money. He had previously told the sheriff that he loaned the car to another dude on that night.

We do not overlook the fact that two alibi witnesses testified on behalf of the appellant and placed him at another location at the time of the burglary. However, on appeal, we view the evidence in the light most favorable to the appellee. Core v. State, 265 Ark. 409, 578 S.W. 2d 581 (1979).

In our opinion the evidence presented at the trial was sufficient to sustain the conviction. However, we must reverse because the in-custody confession was given under circumstances indicating that the officer would “do all he could to help him.” The officer did not do anything to help him.

It is undisputed that the deputy sheriff stated “I’ll help you any way that I can. ” We dealt with a very similar situation in the case of Shelton v. State, 251 Ark. 890, 475 S.W. 2d 538 (1972), and there held the statement by the officers that they would “help me all they could” constituted reversible error. We also considered a similar situation in Freeman v. State, 258 Ark. 617, 527 S.W. 2d 909 (1975). In Freeman the prosecuting attorney had simply stated that if the defendant made the confession “he could not make any promises but that if he had committed a crime it was probably one that would not result in more than 21 years incarceration.” We have many times held there is a presumption that an in-custody confession is involuntary and the burden is upon the state to show the statement to have been voluntarily, freely and understandably made, without hope of reward or fear of punishment. Mitchell v. Bishop, 248 Ark. 427, 452 S.W. 2d 340 (1970); Smith v. State, 254 Ark. 538, 494 S.W. 2d 489 (1973); Northern v. State, 257 Ark. 549, 518 S.W. 2d 482 (1975). Appellee urges that if we find the evidence is sufficient to sustain the conviction we should affirm the case even though we hold the statement to be involuntary. We disagree. In the case of Payne v. State, 226 Ark. 910, 295 S.W. 2d 312 (1956), we affirmed the conviction of the defendant who had been sentenced to death by electrocution. The matter was taken to the United States Supreme Court and is reported as Payne v. State of Arkansas, 356 U.S. 560 (1958). In the Supreme Court’s opinion, Justice Whittaker stated:

Respondent suggests that, apart from the confession, there was adequate evidence before the jury to sustain the verdict. But where, as here, a coerced confession constitutes a part of the evidence before the jury and a general verdict is returned, no one can say what credit and weight the jury gave to the confession ....

Although we have stated that the evidence was sufficient to sustain the conviction without the confession, we must nevertheless reverse because we do not know whether the jury would have found the appellant guilty on the evidence presented if the confession had not also been read to them. See also Johnson v. State, 248 Ark. 184, 450 S.W. 2d 564 (1970).

Reversed and remanded.

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


author: George Rose Smith, Justice.

text:
    GREAT LAKES CHEMICAL CORPORATION v. Jim WOOTEN, Director, Department of Finance and Administration
    79-89
    587 S.W. 2d 220
    Opinion delivered September 24, 1979
    (Division I)
    [Rehearing denied October 29, 1979.]

      Crumpler, O’Connor & Wynne, for appellant.

      Robert G. Brockmanrt, Joseph V. Svoboda, H. Thomas Clark, Jr., Barry E. Coplin, Timothy J. Leathers, by: Jack East, III, for appellee.
   George Rose Smith, Justice.

During three tax years beginning March 1, 1973, Great Lakes purchased chlorine in Louisiana and Texas, paying no sales tax upon it, and used the chlorine in the manufacture of bromine at its plant in Union county. The appellee made a use tax assessment of $94,342.24, plus interest and 10% penalty, upon the value of the chlorine. Great Lakes protested the tax on the ground that the chlorine is exempt, because it becomes “a recognizable, integral part” of the bromine and therefore falls within the sales tax exemption (incorporated in the use tax law) of sales for resale. Ark. Stat. Ann. § 84-1904 (i) (Repl. 1960) and § 84-3106 (B) (Supp. 1977). This appeal is from a decree finding that the chlorine does not become a recognizable, integral part of the bromine and is therefore subject to the use tax.

The facts, all shown by expert testimony, are really not in dispute. Great Lakes first produces brine from the earth, much as oil is produced. The brine contains bromide — a substance of no particular value in itself. Great Lakes, however, converts the bromide into bromine, an element which is valuable in industrial processes because it has the power to bring about oxidation when properly brought into contact with other substances.

The chlorine, which is the subject of the tax in question, is used to convert the bromide into bromine. Chlorine is an oxidizing agent, because each chlorine atom lacks an electron and in a figurative sense “wants” to get that electron from another substance by the process of oxidation. There are other oxidizing agents, such as hydrogen peroxide, but chlorine is the cheapest to use in the manufacture of bromine.

What Great Lakes does is to mix the chlorine and the bromide in a reactor in such a way as to bring about oxidation. In that process each atom of chlorine obtains an electron, on a one-to-one basis, from a corresponding atom of bromide. That transfer of electrons brings about chemical changes in both substances. The bromide becomes bromine as a result of losing an electron. The newly created bromine is industrially valuable, because its lack of that electron makes it an oxidizing agent with the power to bring about oxidation with other weaker oxidants. The chlorine on the other hand, by obtaining electrons from the bromide, undergoes a chemical change and becomes chloride, a worthless salt that Great Lakes discards by injecting it into the earth.

Great Lakes argues that the phlorine itself becomes a recognizable, integral part of the bromine, because the chlorine’s oxidizing potential is transferred to the bromine. But the use tax deals with tangible personal property, which is defined as personal property which may be “seen, weighed, measured, felt, touched, or is in any other manner perceptible to the senses.” § 84-3104 (k) (Repl. 1960). As tangible property the chlorine unquestionably becomes chloride, by gaining an electron, and is discarded as worthless. Thus no tangible part of the chlorine is transferred to the bromine. Exactly to the contrary, the chlorine gains an electron, while the bromide loses an electron.

Bromine’s oxidizing potential — its desire to get an electron back from some weaker substance — is plainly not tangible property. It is a property only in the sense of being a trail of bromine. Thus, the potential is a trait that can be measured, but as the appellee points out, almost everything known to man is a property in that sense. When natural gas is used to heat coffee for sale in a restaurant, the heat is transferred to the coffee and is a measurable property of the hot coffee. But that does not mean that the gas itself is being resold to the consumer as a recognizable, integral part of the hot coffee. (See our discussion of an “integral part” in Hervey v. International Paper Co., 252 Ark. 913, 483 S.W. 2d 199 [1972].) In the same way, Great Lakes uses chlorine in the manufacture of bromine, but the chlorine does not become a part of the bromine. Quite the opposite, the chlorine takes something from the bromide, becomes chloride, and is discarded as worthless. Thus it is at best consumed in the manufacturing process, not resold to the purchaser as tangible property. The chancellor’s decision was right.

We are not sure that we understand the appellant’s other point for reversal, but it seems to be argued that the 10% penalty should not have been imposed. As we read the statute, if the tax is not paid when due, there is either a 10% penalty for negligent non-payment without intent to evade the tax or a 50% penalty for fraudulent non-payment with intent to evade the tax. § 84-3113 (Repl. 1960). One penalty or the other is to be assessed; so Great Lakes cannot complain about the appellee’s having imposed the 10% penalty only.

Affirmed.

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


text:
    Reola JOHNSON v. STATE of Arkansas
    CR 79-106
    587 S.W. 2d 3
    Opinion delivered September 24, 1979
    (Division I)

      John W. Achor, Public Defender, by: Jeff Rosenzweig, Deputy Public Defender, for appellant.

      Steve Clark, Atty. Gen., by: Dennis R. Molock, Asst. Atty. Gen., for appellee.
   George Rose Smith, Justice.

At a bench trial the appellant was found guilty of two offenses and was sentenced to 20 years’ imprisonment for robbery and 10 years for theft of property, the sentences to be concurrent with each other but consecutive to any other sentences being served at the time of the judgment. The only argument for reversal is that the trial judge erred in not finding that the defendant had acted under duress — an affirmative defense under the Criminal Code. Ark. Stat. Ann. § 41-208 (Repl. 1977).

The conflicting testimony presented an issue of credibility for the trial judge. The liquor store clerk who was robbed testified that a man (Ernest Lee Jackson) came into the store, inquired about the price of liquor, and then tied one of the clerk’s hands and compelled her to open the cash register. At that point this appellant walked in the store and said, “Um, um, um, what is this?” The clerk twice asked the defendant to step outside and get help, but the defendant refused and started taking the money out of the cash register. Jackson and the defendant took $229 and left the store. There is nothing in the clerk’s testimony to indicate that the defendant acted under duress.

The defendant testified that she knew Jackson and was afraid of him, because he used to beat women and force them to do things. Nevertheless, she had offered Jackson a ride in her car only moments before the robbery. She said that she went in the store to buy a sixpack of beer. The robbery was in progress. She got the money and went out with it, because Jackson ordered her to. She was afraid he was armed, as he kept one hand at his side. She admitted she was on parole at the time and had four previous felony convictions, three of which were for robbery. Whether the defendant’s testimony overcame the State’s prima facie case was a question of credibility for the trial judge, whose decision ends our inquiry.

Affirmed.

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


text:
    Rosemarie E. CHAMBERLAIN v. NEWTON COUNTY, Arkansas
    79-90
    587 S.W. 2d 4
    Opinion delivered September 24, 1979
    (Division I)

      Appellant, pro se.

      Thomas A. Martin, Jr., for appellee.
   John A. Fogleman, Justice.

Appellant Rosemarie E. Chamberlain filed a petition in chancery court against Newton County, alleging that she was the owner of a 40-acre tract of land over which the county had constructed a roadway without any grant from her and without her consent. She sought a mandatory injunction requiring discontinuance of use of the roadway and restoration of her property to its previous state. She also sought compensation for the cost of a survey to determine the actual location of the road, and damages for the displacement of topsoil and destruction of trees which were removed from her land for construction of the roadway.

Newton County filed a motion to quash the service on it, a demurrer and a third party complaint against Thomas E. and Martha James, as owners of lands adjoining those of Ms. Chamberlain. The grounds stated in the demurrer were that appellant had failed to state a cause of action, and that the county was immune from tort liability. The answer consisted of general and specific denials of the allegations of the complaint. In the third party complaint, it was alleged that James had represented to the county that the Jameses were owners of the land over which the new roadway had been opened, and that Newton County had relied on this representation in constructing the new road. The county sought injunctive relief against the third party defendants for the reopening of an old road across their lands, discontinuance of the use of the new road, restoration of the land on which that road was located to its former condition and a judgment for any amount recovered from the county by appellant.

A hearing was held on January 5, 1978, which resulted in the entry of an order (entitled “temporary order”) by the chancery court on February 13, 1978, authorizing the county to open the old road and reciting the agreement of the county to place barricades at each end of the new road. Appellant’s attorney filed an amended petition on January 20, 1978, joining in the county’s third party complaint. (Appellant asserts that this action was taken against her wishes.) On September 25, 1978, Ms. Chamberlain filed an amended petition alleging that the county was maintaining a nuisance on her property by reason of its failure to restore her land to its original condition and seeking to recover from the county and the third party defendants $2,500 for damages to her land and the cost of a survey she caused to be made.

A hearing was held on October 19, 1978. On November 3, 1978, the chancery court entered an order sustaining the county’s demurrer on the ground that the county was immune from tort liability and dismissed appellant’s complaint.

Appellant, who is obviously not an attorney, is representing herself on this appeal, and her statement of the case and abstract of the record are inexpertly done, to say the least. We must disregard that part of her statement of the case which is not supported by transcript references and appears to be a narration of a sequence of events preceding the filing of her petition but which is not shown in the record of the proceeding in chancery court. These portions also seem irrelevant to the real issues on this appeal.

No testimony was abstracted and we understand from appellant’s statement in her brief, none was heard. Appellant states the following three points for reversal:

I
THE CHANCERY COURT ERRED IN SUSTAINING THE DEMURRER OF THE DEFENDANT NEWTON COUNTY TO THE COMPLAINT OF THE PLAINTIFF.
II
THE CHANCERY COURT ERRED IN DISMISSING THE PLAINTIFF’S CASE AS AGAINST NEWTON COUNTY, INASMUCH AS THE COURT HAD GIVEN THE PLAINTIFF PERMISSION TO FILE AN AMENDED COMPLAINT AND THERE WAS NO PLEADING OR DEMURRER FILED AGAINST SUCH AMENDED COMPLAINT.
III
THE CHANCERY COURT ERRED IN FINDING BY THE RECITATION IN ITS ORDER THAT THE PLAINTIFF’S COMPLAINT WAS AN ACTION IN TORT, INASMUCH AS THE COMPLAINT OF THE PLAINTIFF ALLEGED A CLAIM BASED UPON AN ACTUAL PHYSICAL TAKING OF REAL PROPERTY BY THE COUNTY.

Appellant correctly asserts that, on demurrer, her allegations that Newton County caused a roadway to be constructed over her lands without obtaining any grant of right-of-way or title for that use and purpose and that she had no notice of such taking but discovered it inadvertently are to be taken as true.

If appellant’s action be taken as a suit for damages for trespass, the chancery court had no jurisdiction. An action for trespass is in tort. 87 CJS 1007, Trespass, § 56. The chancery court had no jurisdiction of such an action for two reasons. Equity will not take jurisdiction of an action to recover unliquidated damages for tort. Mannon v. R. A. Young & Sons Coal Co., 207 Ark. 98, 179 S.W. 2d 457; District No. 21, United Mine Workers v. Bourland, 169 Ark. 796, 277 S.W. 546; Spitzer v. Barnhill, 237 Ark. 525, 374 S.W. 2d 811. The county is immune from suit for damages in a tort action. Ark. Stat. Ann. § 12-2901 (Supp. 1977); Sullivan v. Pulaski County, 247 Ark. 259, 445 S.W. 2d 94; Chandler v. Pulaski County, 247 Ark. 262, 445 S.W. 2d 96; Granger v. Pulaski County, 26 Ark. 37.

Even if appellant’s complaint be taken not to be an action for trespass, the chancery court had no jurisdiction. If appellant’s action was to enjoin the taking of her property for the county road, it was too late, and the issuance of an injunction was beyond the power of the chancery court. Since the entry was physical and visible, it afforded Ms. Chamberlain an opportunity to exact payment, require a guaranteeing deposit or obtain an injunction. Miller County v. Beasley, 203 Ark. 370, 156 S.W. 2d 791; Arkansas State Hwy. Com’n. v. Rice, 259 Ark. 190, 532 S.W. 2d 727. Once there had been a physical and visible entry on the lands by the county, and the landowner has stood by and permitted the improvement to proceed until substantial road work had been done, she could no longer resort to injunction, but was relegated to the county’s credit for compensation for the taking by the county. Miller County v. Beasley, supra. See also, Arkansas State Hwy. Com’n. v. Partain, 192 Ark. 127, 90 S.W. 2d 968; Federal Land Bank of St. Louis v. Arkansas State Hwy. Com’n., 194 Ark. 616, 108 S.W.2d 1077. The physical and visible entry on the lands served as notice to the landowner of the taking. Miller County v. Beasley, supra; Sloan v. Lawrence County, 134 Ark. 121, 203 S.W. 260. Actual entry on the land at the place where there had previously been no highway has always been held to be actual notice of taking. Arkansas State Hwy. Com’n. v. Scott, 238 Ark. 883, 385 S.W. 2d 636. The taking was complete when the owner could no longer use the land for its normal and natural purposes. Arkansas State Hwy. Com’n. v. Flake, 254 Ark. 624, 495 S.W. 2d 855.

The fact that no formal condemnation proceeding had been filed is not significant. When the power of eminent domain exists, and property is taken which might be condemned by the exercise of that authority, mandatory injunction to compel withdrawal is not available to the landowner. Dobbs v. Town of Gillett, 119 Ark. 398, 177 S.W. 1141.

When appellant filed her petition for injunction, the construction of the road was an accomplished fact. Her only remedy against Newton County was to file a claim in the County Court of Newton County for just compensation for a completed taking. Exclusive jurisdiction of appellant’s claim for compensation is vested in the County Court of Newton County as a matter relating to county roads. Art. 7, § 28, Constitution of Arkansas. The county could not be sued to recover this compensation by inverse condemnation proceedings. Act 16 of 1879; Ark. Stat. Ann. § 17-702 (Repl. 1968). See State v. Hicks, 48 Ark. 515, 3 S.W. 524; Nevada County v. Williams, 72 Ark. 394, 81 S.W. 384. See also, Deason v. City of Rogers, 247 Ark. 1061, 449 S.W. 2d 410. The chancery court had no jurisdiction to grant relief to appellant against the county, so the demurrer was properly sustained and appellant’s petition properly dismissed.

The decree is affirmed.

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


text:
    Christine R. BROWN v. ST. VINCENT INFIRMARY, Garnishee
    79-120
    587 S.W. 2d 7
    Opinion delivered September 24, 1979
    (Division II)

      Cearley, Gitchel, Bogará, Mitchell & Bryant, for appellant.

      J. Gayle Windsor, Jr., for appellee.
   Conley Byrd, Justice.

Appellant Christine R. Brown obtained a judgment against James Brown, Jr. in a divorce proceeding for past due child support in the amount of $1450. On September 12, 1978, appellant served a writ of garnishment on her ex-husband’s employer, St. Vincent Infirmary. The return on the writ of garnishment states that it was served upon Lou Hillie. However, the proof shows that St. Vincent Infirmary employs 6 people to answer writs of garnishment on its employees (James Brown, Jr. had had about 20 other writs of garnishment filed against him). Mr. Lou Hillie had been hospitalized shortly prior to the day the writ was served with a severe case of emphysema and never did return to work. One other female employee, in the section where garnishments were handled, was away ill on the day of service. Of the other four employees none were competent to take care of the incoming garnishments in Mr. Lou Hillie’s absence. The writ of garnishment served by appellant was placed in Mr. Hillie’s desk drawer and was not discovered until about October 6, 1978. On that date a response was filed in the Pulaski Circuit Clerk’s office purely because the employees were used to handling such writs with the Pulaski Circuit Court. It was not until October 9, 1978 that a response was filed with the Chancery Clerk in this divorce proceeding. Because of the writ of garnishment, St. Vincent Infirmary had withheld $63.68 from James Brown’s wages on September 29, 1978.

Based upon the foregoing record appellant moved for judgment against St. Vincent Infirmary for $1450. The trial court ruled, however, that the circumstances showed excusable neglect within the meaning of Ark. Stat. Ann. § 29-401 (Repl. 1962), with respect to a garnishee (employer). We agree with the trial court and affirm.

We agree: Harris, CJ., and Holt and Purtle, JJ.


text:
    Robert KEIRS v. MT. COMFORT ENTERPRISES, INC, S. E. PRINCE, Individually, and Eddie PRINCE, Individually
    79-95
    587 S.W. 2d 8
    Opinion delivered September 24, 1979
    (Division II)

      Erwin L. Davis, for appellant.

      John C. Everett, of Everett & Whitlock, for appellees.
   Frank Holt, Justice.

Appellant, a minority stockholder, filed a complaint seeking involuntary liquidation of appellee Mt. Comfort Enterprises, Inc., pursuant to Ark. Stat. Ann. §§ 64-906 and 64-908. The corporation was adjudged insolvent, and an order entered authorizing the receiver to sell the corporate assets, including a fully equipped 220 acre poultry farm and numerous items of personal property, at public auction. The notice of the sale, published in a local newspaper, stated that any corporate assets upon which a lien existed would be sold separately and subject to all existing liens. It enumerated three outstanding mortgages which “will exceed” $440,000. Also the three mortgages were in default and subject to foreclosure at any time. All bidders were required to “qualify” by depositing bonds or letters of credit with the receiver prior to the sale.

The equity in the above described real property and various small items of personalty of an undetermined value were sold for the high bid of $4.00 to appellee S. E. Prince. Since the sale was subject to all three mortgages, totaling $446,410.39 and in default, this amount must of course, as observed by the chancellor, be considered as part of the actual sale price, which would be a total of $446,414.39. Appellant filed a petition seeking to set aside the sale on the grounds of inadequacy of purchase price, conspiracy and collusion between the successful bidder and many other persons to depress the sale price, suppress the bidding, and suppress the number of independent bidders. It is from the denial of the petition that appellant brings this appeal.

Appellant first contends that the court erred in failing to • set aside the sale of the equity to appellee S. E. Prince in the land and personal property belonging to appellee corporation. It is well established that the court is the vendor in judicial sales; the court is vested with sound judicial discretion and may confirm or refuse to confirm a sale in the exercise of this discretion. Summars v. Wilson, 205 Ark. 923, 171 S.W. 2d 944 (1943). There the court also held that “[jjudicial sales are not to be treated lightly,” and “the appellate court, in reviewing the action of a trial court to see if there has been an abuse of discretion, does not substitute its own decision for that of the trial court, but merely reviews the case to see whether the decision was within the latitude of decisions which a judge or court could make in a case like the one being reviewed.” To set aside the sale here, the burden is on the petitioner to establish that the property was sold for a grossly inadequate price, and that some slight additional circumstances, such as fraud, unfairness, or inequitable conduct existed. Hinton v. Elliot, 187 Ark. 907, 63 S.W. 2d 633 (1933); Adams v. Spillyards, 187 Ark. 641, 61 S.W. 2d 686 (1933); and Stevenson v. Gault, 131 Ark. 397, 199 S.W. 112 (1917).

A review of the evidence here indicates that the appellant failed to establish that the price was “grossly inadequate.” Appellant’s expert witness testified that one year before the sale he had appraised the farm as an on-going operation at $525,000. This figure, however, included some $20,000 worth of personalty which was sold separately at the sale. In addition, he agreed that the farm’s value had diminished since it was no longer in operation. Also that property frequently brings less at judicial sales. Appellant testified, without stating any basis for his opinion, that the value of the farm as “a going turkey operation” was $600,000. At the judicial sale, the property actually sold, as indicated, for $446,414.39. Therefore, according to the figure of appellant’s own expert witness, the public sale price represents 85.03% of the total value of the property. The sale price also represented 74.40% of the unsubstantiated estimated value stated by the appellant.

In cases where the courts have found a gross inadequacy in price, the difference in the alleged value of the property and the sale price was of a substantial magnitude. In Stevenson v. Gault, supra, a property worth $3,500.00 was sold for $500.00 or 14% of the value. In Mulkey v. White, 219 Ark. 441, 242 S.W. 2d 836 (1951), a forty acre farm was sold for $975.00. In refusing to approve the sale, the court held that the price was greatly inadequate in that “offers of $100.00 or more an acre had been made in open court.” Further, by analogy, as pointed out by the appellees, when real property is sold at public auction by a representative of the decedent, the law requires that such property be sold for not less than 75% of the appraised value. Ark. Stat. Ann. § 62-2717 (Repl. 1971). Here the property sold at a judicial sale for approximately 80% of its true value according to appellant’s own evidence.

We hold that the appellant has not met his burden of proof that the public sale price of the property was grossly inadequate and that the chancellor, therefore, abused his discretion in refusing to set aside the sale. Consequently, it becomes unnecessary to discuss appellant’s contention that certain acts of appellees and others depressed or chilled the public bidding. However, we observe that a review of the record indicates that appellant failed to prove that anyone who wished to qualify for bidding was prevented from doing so or that the bidding by others was “chilled” or “stifled. ” We find no merit in any of appellant’s contentions.

Affirmed.

We agree: Harris, C.J., and Byrd and Purtle, JJ.


text:
    Everett OATES, et ux, Individually and as Parents, et al v. ST. LOUIS SOUTHWESTERN RAILROAD COMPANY d/b/a THE COTTON BELT, et al
    78-254
    587 S.W. 2d 10
    Opinion delivered September 24, 1979
    (In Banc)

      Patterson & Welch, by: Morgan E. Welch, for appellants.

      Barrett, Wheatley, Smith & Deacon, for appellees.
   John I. Purtle, Justice.

This case arises from a tort action on behalf of the parents and estate of the decedent who was driving an automobile when it was struck by a train. The jury, by interrogatories, found decedent’s negligence proximately contributed to the occurrence and that the appellees were not guilty of any negligence which proximately caused the injuries and damages. From the jury’s verdict appellants bring this appeal.

Appellants contend the court erred in rejecting evidence of prior accidents at this crossing; allowing an officer to orally reconstruct the accident; rejecting testimony of a local resident about the history of accidents at this crossing; and by refusing to give AMI Instruction 502. We find no error in any of the rulings by the trial court and affirm the judgment as entered.

Decedent was driving a vehicle south on State Highway 39 where it intersects U.S. Highway 64, in the community of Fair Oaks in Cross County, Arkansas, when she was struck by the northbound train as she proceeded across the railroad on U.S. Highway 64. Highway 39 stops at Highway 64, about 65 feet east of the Cotton Belt tracks. To continue south on Highway 39 the decedent had to turn right on U.S. Highway 64 to cross the tracks. Highway 39 then continues south a short distance after it crosses the railroad. The collision occurred about 3:40 p.m. on November 24, 1974. There is evidence that the railroad signal lights were flashing, the whistle blowing and the bell ringing. Decedent was driving about 10 miles per hour when she pulled on the tracks in front of the train which struck her vehicle.

Appellants attempted to prove several prior accidents at this crossing which certainly has had its share of accidents. Part of the proof was statistics compiled by the Arkansas Highway Department purporting to show the crossing to be abnormally dangerous. The computer printout maintained by the highway department contained a number of reported accidents at this crossing for the past 15 years. The highway department had classified this crossing as a hazardous one. The rating did not take into consideration certain improvements made by the railroad in 1964 nor did the printout describe the conditions and circumstances of each accident. The court rejected the highway department’s figures which were then proffered by the appellants. Appellants also offered the testimony of a local resident to the effect that there had been many accidents at this crossing during the time he lived in Fair Oaks. This testimony was also rejected by the court but proffered by the appellants. Additionally, appellants had propounded interrogatories to the appellees which answers revealed prior accidents at this crossing. After the unfavorable ruling by the court concerning prior accidents these interrogatories were not offered into the record.

None of the witnesses presented testimony that the other accidents occurred under substantially similar circumstances to those existing at the time of the accident in question. Most, if not all, of the other accidents occurred in the early morning or late afternoon and involved vehicles traveling east and west on U.S. Highway 64 when the sun was shining directly into the drivers’ eyes.

The state trooper testified that the sun would have been shining from the right of a person headed south on Highway 39 at the time of this accident. He stated what could be seen by a driver at the time of his observations which were about an hour and a half after the accident. We believe his observations were close enough in point of time to allow him to state his observations to the jury.

There was some evidence that there was a large, red truck in the area which may have partially obstructed the view of the decedent and/or the train crew. However, appellants did not plead or offer proof that the large, red truck was a proximate cause of the accident. The court refused to give AMI Instruction 502 which relates to concurring proximate causes.

We have previously held before other accidents may be offered to show a dangerous or defective condition, and thereby notice to the defendant, it must first be shown there is a substantial similarity of conditions in the proof as to make it reasonable or probable that the same causes or conditions produced the same or similar results. Bush v. Taylor, 130 Ark. 522, 197 S.W. 1172 (1917); St. Louis Southwestern Railway Co. v. Jackson, 242 Ark. 858, 416 S.W. 2d 273 (1967); and Chicago Rock Island & Pacific Railroad v. Lynch, 246 Ark. 1282, 441 S.W. 2d 793 (1969). None of the witnesses in the present case testified to conditions and circumstances which tended to make it appear probable or reasonable that the decedent’s vehicle was traveling under substantially similar conditions as those of the drivers in the other occurrences. Even considering the evidence which was proffered, we cannot say the trial court erred for the reasons above stated.

AMI 502 is to be given when there are concurring proximate causes. The note on use specifically states it is not to be given when the case is submitted on interrogatories. Since AMI 501 was properly given, it was not error to refuse to give AMI 502.

Affirmed.


author: John I. Purtle, Justice. Conley Byrd, Justice,

text:
    Phillip M. TURNER and Mary Anne TURNER, et al v. WEST MEMPHIS FEDERAL SAVINGS & LOAN ASSOCIATION and J. H. SPEARS, Trustee
    79-52
    588 S.W. 2d 691
    Opinion delivered September 24, 1979 .
    (In Banc)

      N. M. Norton, for appellants.

      Spears, Sloan & Johnson, for appellees.
   John I. Purtle, Justice.

This case involves a foreclosure action by the creditor upon a residential loan which was in default. The Turners’, obligors, defense was usury and failure to timely make material disclosures as required by the Truth-in-Lending Act and by Regulation Z. The trial court found the creditor did not make a usurious charge and that there was no failure to make a material disclosure. Judgment for the creditor was granted upon the complaint and the property was ordered sold at public auction. The proceeds were applied to the loan and other judgments which were included in the decree. Obligors bring this appeal.

We are called upon to determine whether the chancellor erred in holding that the finance charges made by the creditor did not exceed the Arkansas statutory interest limit of 10% and whether the failure to include on the disclosure statement the total finance charges and the total of all payments to be made under the loan violated the Truth-in-Lending Act. We conclude the contract was not usurious but there was a failure to make material disclosures as required by the Act.

The facts are not really in dispute. September 9, 1975, Phillip M. Turner and wife, Mary AnnC Turner, appellants, obtained a loan from the West Memphis Federal Savings & Loan Association, appellee, for the purpose of financing a dwelling which they owned and occupied. The loan was accomplished by execution of a note for $38,500 bearing interest at9% and a mortgage which included waiver of dower by the wife. The disclosure statement submitted by appellee failed to disclose the total amount of finance charges or the total of all payments to be made on the loan. Appellants signed and returned the disclosure statement which revealed the creditor had made a 1 % origination fee charge of $385 as well as other charges to appellants.

The loan was completed September 9, 1975, and the first payment, in the amount of $323.10, was due on October 1, 1975, although it was not made until October 10, 1975. There were to be 300 payments in the same amount and each was due on the first of each succeeding month. Most of the payments were late with the last payment, due October 1, 1977, being made on December 9, 1977. Appellees commenced foreclosure action on May 10, 1978, at a time when the payments were considerably in default. Appellants first filed an answer that amounted to a general denial. The answer was amended and a counterclaim filed on July 6, 1978. The answer and counterclaim pleaded usury as a defense and sought customary relief in usury cases. The answer was supplemented on July 14, 1978, by appellants seeking to rescind the contract on the grounds of failure of appellees to make a material disclosure as required by 15 USC 1635.

The court found against the appellants on both counts and entered a decree on October 16, 1978, ordering foreclosure on the loan. The property was subsequently sold at public auction and the proceeds applied to appellants’ indebtedness. Several other judgments against the appellants were granted in the decree but we do not deem it necessary to deal with them in this opinion. The proceeds of the sale were insufficient to pay all judgments granted against appellants.

We first consider the defense of usury. Appellants rely upon Ryder Truck Rental v. Kramer, 263 Ark. 169, 563 S.W. 2d 451 (1978), in support of the usury allegation. Ryder was an appeal from a summary judgment declaring a loan to be usurious. An admission in Ryder conclusively proved that during a period of 32 months the interest rate charged and collected exceeded 10% in each month. We have no such admission in the present case. In fact, the figures from the payment record in the present case conclusively show the interest charged and collected amounted to less than 10%. Therefore, Ryder is not applicable here.

The origination fee of 1%, or $385, was withheld from the obligors. Therefore the $38,500 loan was reduced to $38,-115. We conclude that this $385 was a part of the finance charge. The contract had been in force for about 32 months when suit was filed. Appellants had paid $7,674.10 in interest plus the $385 origination fee for a total payment of $8,059.10. During this same period of time appellees could have collected $8,422.56, including the $385, without exceeding the 10% statutory limit. By adding the $385 origination fee to the interest the rate actually charged was 9.0404%. Therefore, the contract was not usurious.

We next consider the truth in lending disclosure statement. 15 USC 1635 reads:

(a) Except as otherwise provided in this section, in the case of any consumer credit transaction in which a security interest is retained or acquired in any real property which is used or is expected to be used as the residence of the person to whom credit is extended, the obligor shall have the right to rescind the transaction until midnight of the third business day following the consummation of the transaction or the delivery of the disclosures required under this section and all other material disclosures required under this part, whichever is later, by notifying the creditor, in accordance with regulations of the Board, of his intention to do so. The creditor shall clearly and conspicuously disclose, in accordance with regulations of the Board, to any obligor in a transaction subject to this section the rights of the obligor under this section. The creditor shall also provide, in accordance with regulations of the Board, an adequate opportunity to the obligor to exercise his right to rescind any transaction subject to this section.
(b) When an obligor exercises his right to rescind under subsection (a) of this section, he is not liable for any finance or other charge, and any security interest given by the obligor becomes void upon such a rescission. Within ten days after receipt of a notice of rescission, the creditor shall return to the obligor any money or property given as earnest money, down-payment, or otherwise, and shall take any action necessary or appropriate to reflect the termination of any security interest created under the transaction. If the creditor has delivered any property to the obligor, the obligor may retain possession of it. Upon the performance of the creditor’s obligations under this section, the obligor shall tender the property to the creditor, except that if return of the property in kind would be impracticable or inequitable, the obligor shall tender its reasonable value. Tender shall be made at the location of the property or at the residence of the obligor, at the option of the obligor. If the creditor does not take possession of the property within ten days after tender by the obligor, ownership of the property vests in the obligor without obligation on his part to pay for it.
(c) Notwithstanding any rule of evidence, written acknowledgment of receipt of any disclosures required under this subchapter by a person to whom a statement is required to be given pursuant to this section does no more than create a rebuttable presumption of delivery thereof.
(d) The Board may, if it finds that such action is necessary in order to permit homeowners to meet bona fide personal financial emergencies, prescribe regulations authorizing the modification or waiver of any rights created under this section to the extent and under the circumstances set forth in those regulations.
(e) This section does not apply to the creation or retention of a first lien against a dwelling to finance the acquisition of that dwelling.

If the loan had been to finance the acquisition of a dwelling the Act would have no application. The disclosure form used by appellants indicates this loan was on a dwelling then owned and occupied by appellants. Therefore, we hold the Act applicable. The disclosure form used fails to state either the total finance charges or the aggregate or all payments to be made pursuant to the contract. It is true these figures could have been obtained by using the figures stated on the form. We do not find this question to have been decided by this Court nor any United States District Court in Arkansas. Pub. L. 90-321, Title 1, § 125, (15 USC 1635) gives the obligor up until midnight of the third business day following consummation of the transaction or the delivery of the disclosures required under this section and all other material disclosures required under this part, whichever is later, to notify the creditor of intent to rescind. Such intent was given to the creditor on July 14, 1978, almost three years after the transaction was consummated. The matter of whether a notice to rescind is timely was treated in Ljepava v. M.L.S.C. Properties, Inc., 511 F. 2d 935 (9th Cir.1975). In that case the court pointed out that the inadequacies found in the disclosure statement were never corrected; therefore, thes Ljepavas had the right to rescind at any time prior to trial. See also Sosa v. Fite, 498 F. 2d 114 (5th Cir.1974). There was a timely rescission in French v. Wilson, 446 F. Supp. 216 (D.C.R.I. 1978), when the loan had been made in October of 1973 and the rescission was made in May of 1975. A loan had been outstanding from August of 1973 until August of 1974 when the obligors instituted a rescission action. This, too, was held to be a timely rescission. Therefore, if the insufficiencies in the disclosure statement were material the notice in this case was timely.

The only case we have located dealing directly with the term “material disclosure” is Ivy v. United States of America Department of Housing and Urban Development, 428 F. Supp. 1337 (D.C. Ga. 1977). Although the court in Ivy found there was not a material nondisclosure, the meaning of “material” was discussed at length. The court stated:

. . . The Court is persuaded that the different language used in the statute was meant to limit liability under the rescission section to only those nondisclosures which a reasonable consumer would view as significantly altering the “total mix” of information made available. That is, the omission need not be so important that a reasonable consumer would probably change creditors. However, the information must be of some significance to a reasonable consumer and under the circumstances in his “comparison shopping” for credit.

In the Ivy case the defendants conceded they failed to disclose accurately the total of the payments. However, the total failure to disclose amounted to only $11.30 on a total repayment of $12,066.50. The court further stated that it was convinced the mis-disclosure would have absolutely no effect on any reasonable consumer shopping for credit. The “material” disclosure in § 125 (15 USC 1635) is significant because the civil liability section (15 USC 1640) imposes a liability for failure to “disclose.” The civil failure, as provided in 1640, is not argued in the case before us; therefore, we are considering the case under 15 USC 1635.

A number of cases have dealt with the mechanics of rescission as required by § 125 of the Act (15 USC 1635). It was stated in Ljepava, supra, that:

However, we have recently indicated that the statute should not be read as requiring the lender to perform first. In Palmer v. Wilson, supra, (502 F. 2d 860), the majority held that a trial judge had the discretion to condition rescission on tender by the borrower of the property he had received from the lender.

The court of appeals reversed Ljepava, supra, because the trial court apparently felt he had no discretion and that tender was a mandatory requirement for rescission. The court of appeals further held the court should be concerned that the creditor ultimately received the money advanced under the loan agreement. It was held in the case of Eby v. Reb Realty, Inc., 495 F. 2d 646 (9th Cir.1974), that in some cases both rescission and civil penalties were authorized. Usually the courts have limited the obligors to recovery either under 15 USC 1635 or 15 USC 1640. Under the latter section, obligors are entitled to receive a penalty of up to $1,000 plus a reasonable attorney’s fee. § 1640 (a) reads as follows:

(a) Except as otherwise provided in this section, any creditor who fails in connection with any consumer credit transaction to disclose to any person any information required under this part to be disclosed to that person is liable to that person in an amount equal to the sum of
(1) twice the amount of the finance charge in connection with the transaction, except that the liability under this paragraph shall not be less than $100 nor greater than $1,000; and
(2) in the case of any successful action to enforce the foregoing liability, the costs of the action together with a reasonable attorney’s fee as determined by the court.

A review of the federal cases decided under the Truth-in-Lending Act leads us to conclude an action to rescind is an equitable proceeding and the Court should look not only at the violations by the creditor but should consider the course of action taken by the debtor. From reading a history of the legislation it is apparent the Act was directed at loan sharks and fly-by-night operators. By exclusion from the Act of transactions relating to the acquisition of new homes and from the debate by member of Congress there is a clear indication that a first lien on a home is treated differently from a loan for personal property or home improvement. It was not the intent of Congress to allow all loans on a dwelling to be excluded from the provisions of the law.

We had occasion to consider the failure to disclose, as required by the Truth-in-Lending Act, in the case of Nietert & Goodwin v. Citizens Bank & Trust Co., 263 Ark. 251, 565 S.W. 2d 4 (1978). In Neitert the loan had been in existence for about two years when foreclosure was commenced and the obligors then decided to rescind for failure to disclose, as required by 15 USC 1635. We found there was a failure to disclose but denied relief to the obligors because they failed to tender as required by the Act. There was another factor involved in Nietert which is not present here. The creditor there agreed to give the obligor time to try to arrange for financing the required tender from some other source. We held the borrowers were required to pay what they had received from the lender before the penalties applied. Thus the conduct of the parties is a relevant factor to be considered in each case.

We are not unmindful of the fact that the creditor is required to return the property and remove any liens when rescission is properly requested. Neither are we unaware of the fact that the obligor has an equally responsible duty to return the funds borrowed, less the overcharges, to the lender. In the present case the creditor was not in possession of anything which could be returned to the obligors except the note and the mortgage. Apparently these items had already been placed in the court files relating to the foreclosure action. Appellants had, subsequent to the loan in question, imposed an additional mortgage upon their dwelling. It is clear from the circumstances in this case that appellants could not tender to appellee that which was due. We have a failure of both parties to meet the conditions required by the law. Each was entitled to something which was unobtainable at the time. Appellants never tendered to appellee the money to which they were entitled; therefore, they have not complied with the law. It would have been a useless gesture for appellees to have demanded their money from appellants.

The mechanics of rescission are not necessarily bound to proceed in the exact manner in which they are set out in the Act. Both parties have obligations and it was impossible to set them out simultaneously. It is logical to assume the obligor should be bound to return any items received through the transaction although notice of rescission must first be given. Had appellants obtained an automobile with the proceeds of the loan and it had been destroyed by fire or otherwise, it would have been impossible to return it. Under those circumstances they would be obligated to return the money borrowed, less items properly deductible. Under the present circumstances it would have been inequitable to require the lender to return the loan proceeds without any expectation of receiving anything of value in return. It is obvious the appellants could not tender their dwelling; therefore, they were obligated to tender the money received by them plus that which had been paid out on their behalf to extinguish prior loans.

The failure by the creditor to make a material disclosure authorized appellants to rescind the transaction. From the wording of the Act and the history of its enactment, we are of the opinion that the rescission procedure contemplated the transaction being rescinded within the three day period. However, the language used in the Act clearly extends the right of rescission until such time as the material disclosure is in fact made. From the above, and the many cases decided under the Act, we conclude that rescission pursuant to this law is an equitable proceeding. It was not contemplated that the borrower be allowed to reap the benefits of the transaction for a period of years and then call upon the lender to make an inequitable restitution. There is a fundamental difference in the benefits which would have been received by the borrowers had the transaction been rescinded within the three day period and those they claim to be entitled to after a period of months or years. We believe the relief granted should approximate that which would have been due during the three day period even though rescission occurs much later.

We feel under the particular circumstances in this case that appellants should not be liable to the appellee for the attorney’s fees imposed upon them in the decree nor should they be liable for court costs but should receive the origination fee in the sum of $385. Neither do we feel appellants should be entitled to an attorney’s fee in view of the conduct of the parties concerning the rescission. Therefore, the case is remanded to the trial court with directions to enter a decree consistent with this opinion.

Reversed and remanded.

Fogleman, J., not participating.

Byrd, J., dissents.

Conley Byrd, Justice,

dissenting. I disagree with the majority that appellee, West Memphis Federal Savings & Loan Association failed to make a “material disclosure” in its Truth-in-Lending Statement as a matter of law as distinguished from a matter of fact. Appellee’s Truth-in-Lending Statement (attached hereto as an appendix) shows that the amount of the note is $38,500; that an origination fee of $385 was charged the borrower; the net amount financed ($38,500 — $385) was $38,115; the annual percentage rate of the finance charge was 9.25%; and the principal and interest was to be paid in 300 equal monthly installments of $323.10 with the first payment being due on the first day of October, 1975 and a like such payment being due on the first day of the. month thereafter. Therefore, the only two things the statement fails to show are the total amount of the finance charge and the total amount of the payments. However, these two items can easily be determined by simple arithmetic — i.e. 300 X $323.10 = $96,930, the total of the payments and when the amount financed, $38,115 is subtracted from the total payment we find that the total of the finance charges is $58,815. The record here as abstracted shows nothing about appellants’ abilities to determine whether these omitted items were material. Instead appellants rely solely upon the Truth-in-Lending Statement to bring themselves within the statutory definition of a material disclosure. If appellants should happen to be the president of a Commercial Bank or a competitive savings and loan bank or a person holding a master’s degree in mathematics the Federal Reserve Board, who drew Regulation (12 CFR § 226.1 et seq.), would look “red faced” in trying to explain to any normal citizen how appellee’s Truth-in-Lending Statement failed to make a “material disclosure.” The Federal Reserve Board staff, Federal Register Volume 42, No. 144, July 27, 1977, agrees with my view — it is there stated:

“Section 226.9(a) provides that the three-day right of rescission begins on the date the transaction is consummated or the date of delivery of the rescission notice ‘and all other material disclosures required by this Part, whichever is later.’ It is staff’s opinion that where a creditor is making use of the provisions of § 226.9(g) and has provided its customers with printed information from which the items listed in that section can be determined, this information constitutes the ‘other material disclosures’ referred to in § 226.9(a).”

The foregoing statement is in accordance with the Truth-in-Lending Act § 102 (15 U.S.C. § 1601) which provides:

“The Congress finds that economic stabilization would be enhanced and the competition among the various financial institutions and other firms engaged in the extension of consumer credit would be strengthened by the informed use of credit. The informed use of credit results from an awareness of the cost thereof by consumers. It is the purpose of this title to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit.”

This position is not original with me, see Hervey v. Housing Development Corp., 451 F. Supp. 1198 (D.C. Mo. 1978), where the Truth-in-Lending Statement failed to show the total amount of the payments and Ivey v. United States Dept. of Housing & Urban Dev., 428 F. Supp. 1337 (D.C.N.D. Ga. 1977), wherein there was an error of $11.30 in calculating the total payments.

Just so that my position will not be misunderstood, it is that when the Truth-in-Lending Statement furnishes information from which any omission can be ascertained by simple mathematical calculation according to the math taught generally in the junior high schools, then such an omission standing alone should not be considered as a “material omission” within the meaning of 15 U.S.C. § 1635. Now as to some aged or illiterate persons such an omission might become a material omission, but the person seeking rescission under 15 U.S.C. 1635 should shoulder the burden of showing that the non-disclosure was material as to him.

Finally, I note that the majority quote and rely upon 15 U.S.C. § 1640 which provides for the recovery of civil penalties and attorney’s fees for a non-disclosure. I can see no reason for the majority to rely upon 15 U.S.C. § 1640 because that statute contains a one year statute of limitations, 15 U.S.C. § 1640(e). The loan here was made on September 9, 1975 and the Truth-in-Lending defense was first raised by an amended answer on July 14, 1978. Furthermore, the appellants did not rely upon 15 U.S.C. § 1640 in their argument before this court.

If one would read the Truth-in-Lending Act in its entirety instead of just a passage here and there, he would find that there is a material difference between the relief provided in 15 U.S.C. § 1640 and the relief provided in 15 U.S.C. § 1635. The former, 15 U.S.C. § 1640, which does not mention “material disclosures,” provides for the recovery of limited penalties plus an attorney’s fee but incorporates a statute of limitations of only one year from the date of the loan. However, 15 U.S.C. § 1635 provides for a rescission for material non-disclosures together with the recovery of all finance charges paid to the lender and has a three year statute of limitation. 15 U.S.C. § 1635 makes no provision for the recovery of attorney’s fees.

For the reasons herein stated, I respectfully dissent.

      The disclosure statement showed the annual percentage rate as 9.25%. See Exhibit “B” attached as an appendix to dissenting opinion.

      The record shows that all but $6,587.22 of this $38,115 loan was used to pay off four other bank loans to appellants.