author: Lyle Brown, Justice.

text:
    Thomas Mitchell HILDEBRANDT v. STATE of Arkansas
    5739
    482 S.W. 2d 816
    Opinion delivered July 24, 1972
    C. David Furrow, for appellant.

      Ray Thornton, Atty. Gen., by: John D. Bridgforth, Asst. Atty. Gen., for appellee.
   Lyle Brown, Justice.

Appellant Thomas Mitchell Hildebrandt entered a plea of guilty to burglary and received a five year sentence. Some two years later he filed his petition under our Rule 1 alleging illegal procedures which denied him his constitutional rights. His petition was denied. On appeal it is contended that the trial court should be reversed because: (1) appellant was coerced by the prosecuting attorney into pleading guilty, and (2) the prosecution held a conference with appellant absent appellant’s attorney, thereby denying him effective assistance of counsel.

Appellant testified that the prosecuting attorney threatened to obtain a twenty-one year sentence if appellant did not plead guilty and take five years. He said the conversation took place in the courtroom and out of the hearing of appellant’s appointed counsel. Appellant said he was guilty and that he believed he would have been given the maximum of twenty-one years had he gone to trial. Roy Reynolds, a convict, testified in behalf of appellant. Reynolds said he heard parts of a conversation between appellant and the prosecutor; that the prosecutor asked appellant if he had agreed to take five years and appellant stated he had so agreed. Reynolds said he heard no threat but did hear twenty-one years mentioned in the conversation.

The state called C. B. Nance, Jr., the attorney who represented appellant at the trial, and Gerald Pearson, prosecuting attorney. Nance testified that he interviewed appellant several days prior to trial date and appellant said he was guilty of the charge. Thereafter, so Nance testified, he conferred with the prosecuting attorney’s office and negotiated a recommendation of five years. Pearson testified that he did not negotiate with appellant and that he always talked to a defendant (on rare occasion when he did talk to them) in the presence of defense counsel. “If I had any conversation with him it would be merely to reaffirm that he wanted to plead guilty, that our recommendation would be five years in the penitentiary.”

There was ample evidence to support the trial court’s judgment.

Affirmed.

Fogleman, J., not participating.


source: Caselaw Access Project

author: John A. Fogleman, Justice.

license: Public Domain

text:
    C. G. DAVIS v. V. G. SCHIMMEL, Trustee et al
    5-5837
    482 S.W. 2d 785
    Opinion delivered July 24, 1972

      McKay, Chandler ér Choate, for appellant.

      Keith, Clegg ir Eckert and William E. North, San Antonio, Tex.; Baker, Botts, Shepherd ir Coates, Houston, Tex.; Arthur C. Hurt Jr., Los Angeles, Cal.; Stubbleman,

      McRae, Sealy, Laughlin Browder, Midland, Texas, for appellees.
   John A. Fogleman, Justice.

Appellant filed his petition in the chancery court on June BO, 1969, alleging that he was the owner of oil and gas leases covering an undivided .33517297 of the oil, gas and other minerals in certain lands in Lafayette County. He sought the appointment of a receiver to negotiate and execute leases on unleased interests in these lands. The proceedings were instituted under the provisions of Ark. Stat. Ann. § 52-201, et seq. (Repl. 1971). Appellees (or most of them) were named as defendants in that action. All of them, except Frontier Oil & Gas Co., Inc., were nonresidents of Arkansas. Frontier was a foreign corporation having an agent for service in Arkansas, but no summons was served on this agent. All of the defendants were served by publication of a warning order, except for one resident of the state. Warning order was made on the date the petition was filed, and published on July 3, 10, 17 and 24, 1969. Proof of publication was filed on July 26, 1969. An attorney ad litem reported that he had made diligent search and inquiry as to the whereabouts of the nonresident defendants but had been unable to locate addresses for any of them. He asked that he be dismissed from any further participation.

On the 22nd day of July, 1969, the chancery court appointed William McGill receiver to lease the entire unleased mineral interests. The receiver was directed to report his actions to the court for approval or rejection within 30 days after the execution and delivery of the lease. No bond was required of the receiver. This order was filed on July 24, 1969. McGill filed his report on the same date. He reported that he had granted to appellant an oil and gas lease of the interests of all the defendants for a five-year term for a consideration of $15 per acre for the unleased mineral interests, or $797.79. He paid the rental into the registry of the court, and asked that he be discharged. This report was approved by the court on August 1, 1969, and the order of approval filed August 4, 1969. No pleading was filed by any of the appellees until on June 30, 1971 and subsequent dates, they filed motions to vacate the orders of the court appointing the receiver and approving his report. Each of the motions alleged that the movant had been prevented from defending by unavoidable casualty or misfortune in that these orders and decrees were entered without notice. The basis of the motion of Frontier was that the constructive service on it was void because it had an agent for service in Arkansas which had not been served with summons. The other appellees alleged that constructive service upon them was void because it was issued upon an insufficient affidavit. Some alleged that their places of residence were recited in the deeds under which they held their interests in the land. All alleged as meritorious defenses that: the orders were void, the service was void; the lease was not “for the best interest of or compensation to” the defendants, in that appellant had paid a higher cash bonus and granted a royalty of one-fourth to other lessors having interests in the same lands; the lands were currently of greater value for oil and gas than previously; the consideration for lease was not “fair and equitable”; the receiver did not negotiate for the lease, but simply permitted appellant to dictate its terms.

Appellant responded, contending that appellees had entered their appearance by filing their respective motions, and thereby cured any lack of previous notice, that there was no unavoidable casualty or misfortune, or meritorious defense alleged. Appellant also denied that the warning order was insufficient notice or that the affidavit therefor was insufficient. Appellees later amended their motions to allege that their separate interests were subject to valid oil and gas leases executed by them.

It was stipulated that Frontier was prevented from appearing by unavoidable casualty or misfortune. Each of the individual appellees testified that he had no notice (from the attorney ad litem or any other person, or by any other means) or knowledge of the pendency of the action until after April 1, 1970. It was shown that drilling was commenced on a well approximately one mile from the lands involved at 11:30 p.m. on July 3, 1969, where the Buckner Anhydrite was encountered about 9:30 p.m. on July 19, 1969, the Smackover Limestone about 4:30 p.m. on July 23, 1969, and one core was recovered at about 7:30 p.m. on July 23, 1969. It was also shown that a report on file with the Oil and Gas Commission showed that the well was commenced August 18, 1970, and completed August 24, 1970. A test on August 26, 1970, showed 358 barrels of net oil produced and 247 MCE of gas produced. Davis admitted that he had agreed to assign Shell Oil Company one-eighth of the production of oil, gas and minerals on demand as consideration for a lease dated June 9, 1969, but denied that there was any money consideration for the lease.

The chancellor heard appellees’ motions on November 19, 1970, and the decree from which this appeal comes was filed April 5, 1971. In granting the motions, the court found that: the orders appointing the receiver and confirming his report were entered without notice, actual or constructive to appellees, and were void; the court lacked jurisdiction to enter them; all proceedings thereunder, including the receiver’s lease, were void. On these findings the court set aside the orders and the lease. The chancellor held that the showing of a meritorious defense was not required but that each of the appéllees had made a prima facie showing of a meritorious defense. In his memorandum opinion, the chancellor held that: under Ark. Stat. Ann. § 29-107 (Repl. 1962), a judgment rendered without notice is a nullity; the affidavit for warning order was void because it was not signed by the affiant, but by his attorney; the order appointing the receiver was entered prior to the lapse of 30 days from the date the warning order was issued and prior to the filing of the report of the attorney ad litem; the challenge to the jurisdiction itself was a meritorious defense; the defendants had a right to defend at every stage of the proceeding, including the right to object to the appointment of the receiver on the ground of his lack of qualifications and impartiality, and to the making of the lease on the ground that it was not favorable to the mineral owners and the defendants, some of whom were shown to be oil operators themselves and willing to participate in the risk and expense of drilling operations; the appellees had not entered their appearance in a manner sufficient to validate the proceedings.

Appellant contends that Ark. Stat. Ann. § 52-205 under which the original proceedings were had, by its own language barring any attack upon the lease entered into by the receiver “except by direct appeal in the manner provided by law,” renders appellees’ method of attack unavailable to them. He argues that the language of the statute is to be taken literally and that no action to set aside the decree appointing the receiver or approving the lease entered into by him except by appeal to this court from that decree, even by one who has no notice of the proceeding in which it is rendered and no reasonable opportunity to be heard. We cannot construe the language of the statute as appellant does, because to do so would render it unconstitutional. Constitutional due process requires that no one be deprived of his property or rights, therein without being given an opportunity to be heard. Meserve v. Edmonds, 223 Ark. 297, 265 S.W. 2d 704; Boddie v. Connecticut, 401 U.S. 371, 91 S. Ct. 780, 28 L. Ed. 2d 113 (1971); Mulleme v. Central Hanover Trust Co., 339 U.S. 306, 70 S. Ct. 652, 94 L. Ed. 865 (1950). See also, City of Texarkana v. Brachfield, 207 Ark. 774, 183 S.W. 2d 304; Craig v. Russellville Waterworks Imp. Dist., 84 Ark. 390, 105 S.W. 867; McLean v. City of Ft. Smith, 185 Ark. 582, 48 S.W. 2d 228; Pulaski County v. Commercial National Bank, 210 Ark. 124. 194 S.W. 2d 883; Massey v. Arkansas & Missouri Highway District, 163 Ark. 63, 259 S.W. 387.

Due process requires, at a minimum, that one be given a meaningful opportunity for a hearing, appropriate to the nature of the case and preceded by notice, before he is deprived of any significant property interest, except where some valid, overriding state interest justifies postponing the hearing until after the event. Boddie v. Connecticut, supra; Board of Levee Commissioners v. Johnson, 178 Ky. 287, 199 S.W. 8, L.R.A. 1918E 202 (1917). Due process requirements are satisfied if the property owner has reasonable notice and a reasonable opportunity to be heard and to present his claim or defense, or to protect and enforce his rights, before a tribunal having power to hear and rule his cause, due regard being had to the nature of the proceeding and the character of the rights which may be affected by it. Dohany v. Rogers, 281 U.S. 362, 50 S. Ct. 299, 74 L. Ed. 904, 68 A.L.R. 434 (1930); State ex rel Sweezer v. Green, 360 Mo. 1249, 232 S.W. 2d 897, 24 A.L.R. 2d 340 (1950), [overruled on another point, State v. Kirtley, 327 S.W. 2d 166 (Mo. 1959).]

A purely arbitrary or capricious exercise of legislative power, whereby a wrongful and highly injurious invasion of property rights is practically sanctioned and the owner stripped of all remedy is wholly at variance with the principles of due process. Truax v. Corrigan, 257 U.S. 312, 42 S. Ct. 124, 66 L. Ed. 254, 27 A.L.R. 375 (1921). In the concrete, due process means that in a contest concerning rights of life, liberty or property, a citizen will be given a reasonable opportunity to contest the propriety of each step in the proceedings against him. State v. Broaddus, 315 Mo. 1279, 289 S.W. 792 (1926); City of St. Louis v. Missouri Pacific R. Co., 278 Mo. 205, 211 S.W. 671 (1919). Since notice and an opportunity to be heard are prerequisites of jurisdiction and jurisdiction a prerequisite of a valid judgment, the legislature is without authority to dispense with these requirements of due process. Board of Commissioners of Roxboro v. Bumpass, 233 N.C. 190, 63 S.E. 2d 144 (1951); and see Leflar, American Conflicts Law 35, § 20 (2d Ed., 1968).

It will be noted that the statutory limitation on the attack on the validity of a lease approved by the court applies to nonresidents. Notice of appeal must be given within 30 days from the entry of any judgment or decree from which an appeal is taken. Ark. Stat. Ann. § 27-2106.1 (Repl. 1962). Even if a nonresident defendant without any notice or service, actual or constructive, could ever avail himself of a technical “direct appeal,” his trial de novo on a chancery appeal would have little meaning, for he would be unable to present any evidence to support his claim or defense. It cannot be said that appellant’s construction would accord due process of law to nonresidents. Thornton v. Road Imp. Dist. No. 1, 291 F. 518 (8th Cir. 1923), dismissed 269 U.S. 592, 46 S. Ct. 12, 70 L. Ed. 429 (1925). We will not presume that the General Assembly intended to pass an unconstitutional act, but will construe an act to sustain it, if such a construction may be fairly and reasonably given. McLeod v. Santa Fe Trail Transp. Co., 205 Ark. 225. 168 S.W. 2d 413: Lacefield v. Taylor, 185 Ark. 648, 48 S.W. 2d 832. If we construe the words “direct appeal,” however, to mean “direct attack” in the manner provided by law, then the statute would not violate constitutional due process. The word “appeal” has been taken in appropriate context to mean an application to the same tribunal that originally acted to reconsider, review or reverse its own previous action. Longworth v. Sturges and Anderson, 4 Ohio St. Rep. 690 (1855); Leach v. Blakely, 34 Vt. 134 (1861 ).

Appellees have mounted a direct attack upon the action of the chancery court. We have long held that any proceeding or motion to have a judgment declared void upon the ground that it was entered without service or notice is a direct and not a collateral attack. Meserve v. Edmonds, 223 Ark. 297, 265 S.W. 2d 704; Morgan v. Leon, 178 Ark. 768, 12 S.W. 2d 404; Wilder v. Harris, 205 Ark. 341, 168 S.W. 2d 804; Brick v. Sovereign Grand Lodge, 196 Ark. 372, 117 S.W. 2d 1060; Brookfield v. Harahan Viaduct Improvement Dist., 186 Ark. 599, 54 S.W. 2d 689; Woods v. Quarles, 178 Ark. 1158, 13 S.W. 2d 617; Hall v. Huff, 122 Ark. 67, 182 S.W. 535.

Appellant next contends that by alleging a meritorious defense and praying that the orders of the court be set aside because of unavoidable casualty based on lack of previous notice of the proceedings, appellees entered their appearance in the action. With this argument, we agree, but we agree with the chancellor that this appearance does not cure any decrees previously entered in the case which are void for want of notice or process. Appellees contend that they have not entered their appearance at all, relying upon Southern Building & Loan Assn. v. Hallum, 59 Ark. 583, 28 S.W. 420. We do not agree with their analysis of that decision. It was there held that the filing of the motion to set aside a default judgment on the ground that defendant had not been served with process did not constitute an appearance or waiver of service, but this holding could not be said to relate to anything more than the validity of the default judgment, because that judgment was reversed and the cause remanded to the trial court to be proceeded with by that court as if the appellant (who had not been served) was duly served with process in the action. The identical action was taken under similar circumstances in St. Louis, I. M. & S. Ry. Co. v. State, 68 Ark. 561, 60 S.W. 654.

When the sole basis for attack upon the jurisdiction of the court to render a decree is want of service of process sufficient to enable a party to appear and defend but service obviously can be had without questions of venue or subject matter jurisdiction arising, it would be absurd to set aside the judgment and require an entirely new service of process. It is a different matter when the ability of the moving party to bring the objecting party within the jurisdiction of the court by the service of process is doubtful or where questions of venue would arise. No doubt exists here as to the power of the court to grant the relief sought, upon proper showing, after proper service of process, actual or constructive, has been had. No venue problems present themselves. Actually, the authority relied upon in Hallum recognized that a motion to set aside a judgment and continue the cause could operate as a waiver of notice when sustained, but not when overruled. Baskins v. Wylds, Admr., 39 Ark. 347. In Pennington’s Admrx. v. Gibson, 6 Ark. 447, this court said:

The appellant, by appearing and applying to have the default set aside, waived none of her legal rights, except that of notice. She appeared, as she had a right to do, to ask the court to set aside a mere nullity, and when that was done, she was in court for the first time, and consequently authorized to interpose any defence whatever.

A different situation prevails where there is a motion to quash service before judgment. Appellees were urging the court that they had a meritorious defense. They should be permitted to assert it, but new process or service is not required.

Appellant urges that there was no showing of unavoidable casualty because, he contends, the warning order was validly issued and published. We need not go into the sufficiency of the report of the attorney ad litem or of the availability or lack of information as to the wherabouts of appellees, because we agree with the chancellor that the warning order was void.

Under the express terms of Ark. Stat. Ann. § 52-203, summons is to be served as in other cases in chancery and persons whose whereabouts are stated in the petition to be unknown to the plaintiff are to be constructively summoned as provided in Ark. Stat. Ann §§ 27-354, 27-357 and 27-359 (Repl. 1962). Most of the appellees are specifically named in the petition but there is no allegation in the petition that the whereabouts of any person is unknown nor are any named as “all wh m it may concern”; however, we may consider the petUon and affidavit for warning order as a unit in deciding whether the clerk of the court was authorized to issue a warning order. Harding Construction Co. v. Drainage District No. 17, 178 Ark. 778, 13 S.W. 2d 312. The body of the affidavit for warning order in this case, omitting the names of most of the defendants, reads:

COMES C. G. Davis, plaintiff herein, and states on oath that he has made diligent search and inquiry as to the whereabouts of the defendants, V. G. Schimmel, Trustee, and Mrs. V. G. Schimmel, * * * Lewis W. Pollock and Mrs. Lewis W. Pollock, his wife, and/ or their unknown heirs, Jobar Royalties, Inc., * * * and Frontier Oil & Gas Co., Inc., or their unknown successors, Trustees in liquidation or any unknown stockholders, are, to the best of his information and belief, non-residents of the County of Columbia and State of Arkansas; and he prays that Warning Order issue for said defendants.

The only signature on the affidavit is that of the law firm representing appellant, by a member of the firm.

The proceeding under review is a statutory proceeding and the statute contemplates that the owners of interests other than those of the petitioner be made parties defendant, and that such owners as were nonresidents be served by warning order. The proceeding, in this respect, closely parallels the statutory action to quiet or confirm title. See Quertermous v. Bilby, 144 Ark. 98, 221 S.W. 856; Frank v. Frank, 175 Ark. 285, 298 S.W. 1026. In a statutory proceeding outside the scope of the common law every act which is jurisdictional or the essence of the proceeding or for the benefit of the party affected is mandatory, even when the proceedings are denominated as in rem by the terms of the statute, and it is necessary that the mode of obtaining jurisdiction prescribed by the statute be strictly pursued. Sinclair Refining Co. v. Bounds, 198 Ark. 149, 127 S.W. 2d 629; Frank v. Frank, supra; Quertermous v. Bilby, supra; Van Etten v. Daugherty, 83 Ark. 534, 103 S. W. 737. When the statutory requirements as to service are not strictly complied with, a judgment or decree affecting or divesting property rights of one not served has been called “absolutely null and void” and “utterly void.” Quertermous v. Bilby, supra; Van Etten v. Daugherty, supra. Arkansas Statutes Annotated § 29-107 provides that judgments, orders and decrees made against anyone without notice, actual or constructive, and all proceedings had thereunder are absolutely null and void. See also, Sinclair Refining Co. v. Bounds, supra; Frank v. Frank, supra.

A method of service required for nonresidents is by publication of warning order. Ark. Stat. Ann. §§ 52-203, 27-354 — 357. The rule is well established that when constructive notice only is given, the requirements of the statute must be strictly complied with. Sinclair Refining Co. v. Bounds, supra; Swartz v. Drinker, 192 Ark. 198, 90 S.W. 2d 483; Missouri Pacific R. Co. v. McLendon, 185 Ark. 204, 46 S.W. 2d 626; Lawrence v. State, 30 Ark. 719. Where essential statutory provisions governing service by publication are not strictly complied with as to nonresident defendants, all proceedings as to them are void. Beidler v. Beidler, 71 Ark. 318, 74 S.W. 13.

It has even been held that, where jurisdiction must be exercised by a court in a special manner, and not according to the course of the common law, the facts essential to the exercise of such jurisdiction must appear in the record; and, if they do not, a judgment in the proceeding is void. Monks v. Duffle, 163 Ark. 118, 259 S.W. 735.

Where an action is based on constructive service, no action is commenced or cause pending until the proceedings provided for in the governing statute are complied with and if there is no such compliance, the proceedings are void, and the court has no power to take affirmative action. Swartz v. Drinker, supra; Missouri Pacific R. Co. v. McLendon, supra; Sinclair Refining Co. v. Bounds, supra; Frank v. Frank, supra. It is only where the affidavit prescribed by Ark. Stat. Ann. § 27.-354 has been made and warning order based thereon has been issued that the action can be said to have been commenced or the cause pending, and until this is done, the court has no jurisdiction. Swartz v. Drinker, supra; Missouri Pacific R. Co. v. McLendon, supra; Frank v. Frank, supra.

The affidavit for warning order must show that the plaintiff has made diligent inquiry and that it is his information and belief that the defendant is a nonresident. It must strictly comply with the statute. Holloway v. Holloway, 85 Ark. 431, 108 S.W. 837; Waggoner v. Fogleman, 53 Ark. 181, 13 S.W. 729; Turnage v. Fisk, Executor, 22 Ark. 286; Allen & Hill, Admrs. v. Smith, 25 Ark. 495.

The affidavit here is not in strict compliance with statutory requirements. Even though Ark. Stat. Ann. § 27-1107 (Repl. 1962) permits an affidavit to obtain a warning order to be made by the attorney of the party, it also requires that the “affidavit of such agent or attorney shall state that the affiant is the agent or attorney of the party.” We might say that, reading the complaint, its verification, and the signature to the affidavit both the law firm and the individual partner are identified as attorneys for the plaintiff. This has been held sufficient in some jurisdictions. See Anthony v. Anthony, 221 Ala. 221, 128 So. 440 (1930). We cannot say, however, that the attorney is the affiant. The introduction to the affidavit clearly identifies the plaintiff himself as the affiant and the body thereof purports to state plaintiff’s own diligent search and inquiry, not that of his attorney, and plaintiff’s own information and belief, but not that of the attorney. The language of our statute seems to require that the diligent inquiry be by the plaintiff and that the information and belief be his own. See Faulkner v. Kirkes, 276 P. 2d 264, 47 A.L.R. 2d 418 (Okla. 1954). However, there seems to be a split of authority on the question whether such an affidavit by an attorney must state the attorney’s knowledge, information and diligence or that of the client. See Annot. 47 A.L.R. 2d 423 (1956). Be that as it may, we cannot say which situation is stated in this case, or who the affiant actually is. The jurat is in the usual form, i.e., “Sworn to and subscribed before me. . .” The affidavit certainly is not signed by the plaintiff, nor does the signature purport to be that of plaintiff. It is clearly that of his attorney. The body of the affidavit does not purport to be upon the oath of the attorney. The jurat does not make any distinction showing which person was sworn and which one subscribed. We must sustain the chancellor’s holding that this affidavit was void because it was not signed by the affiant but by his attorney.

Because of the invalidity of the affidavit for warning order for failure to comply strictly with statutory requirements, the warning order was void, no action was commenced or pending as to the defendants to be constructively served thereby, and the order appointing the receiver and confirming the lease made to the plaintiff was void. Sinclair Refining Co. v. Bounds, supra; Frank v. Frank, supra. See also, Monks v. Duffle, supra. As we said in Frank, the defendants were not in court and the case was prematurely submitted to the court.

Appellees argue that, since Ark. Stat. Ann. § 27-355 (Repl. 1962) permits the court to make the warning order upon the requisite facts being shown by affidavit or other proof, this warning order was properly issued. No warning order was made by the court. The warning order here was made by the clerk. Still, even if the clerk should be authorized to make a warning order under this section there is no proof on which to base its issuance other than the defective affidavit.

Of course, the decrees are also void as to Frontier because it had a properly designated agent for service in the state. Sinclair Refining Co. v. Bounds, supra. Furthermore, since the lease was made to appellant, he is in no position to assert that it is impervious to attack by appellees. In Beidler v. Beidler, supra, we held that an attachment plaintiff, purchasing at an attachment sale in the action instituted by him, was in no position to assert his title thereunder against the rights and equities of a defendant on whom constructive service was invalid. The same rule should apply here.

This brings us to appellant’s contention that, before appellees could have the judgment vacated, it was necessary that they make a prima facie showing of a meritorious defense and that they failed to do so. Appellees contend, however, that they did show a meritorious defense by showing that the judgment was void for want of jurisdiction, that they had a right to object to the appointment of McGill, that the evidence showed an inadequate consideration for the lease which was fixed by appellant himself and that appellant failed to reveal to McGill the discovery of oil by appellant in the nearby well, and that appellees had the right to protect their interest at every step during the receivership, which would be particularly meaningful since some of the appellees were engaged in oil operations themselves.

The receiver reported that the lease was for the best interest of the parties to the action. The receiver never appeared before the court. His report was approved, with the court’s routinely accepting the report at face value. The receiver testified that he served as such at the request of appellant, his close personal friend and associate in the oil business. He said that thereafter he dealt only with appellant’s attorney. He signed papers previously prepared by appellant’s attorney after only 15 to 50 minutes of conversation with the attorney and without knowledge of significant developments that had taken place with respect to the drilling of a well about one mile away. He said that he would personally prefer an 1/8 override, such as was given one of Davis’ lessors, to a $15 per acre paid up lease.

We are inclined to agree with the chancellor that prima facie evidence showing a meritorious defense was not necessary in this direct attack upon the court’s orders in which it was clearly shown that they were absolutely and completely null and void, not voidable, because they were rendered in a statutory action or proceeding which was not actually pending because it had not even been commenced. We say this in spite of the fact that language in opinions in some of our decisions would indicate that such a showing is required. Those decisions where the attack was collateral or where the proceedings were not in a statutory action are not governing in this situation. Those involving judgments rendered when an action was actually pending are also inapplicable to this situation.

It is widely recognized that there are many exceptions to the rule requiring that a meritorious defense be shown before a judgment is vacated. In 49 C.J.S. 644, Judgments § 336, we read:

Exceptions to the rule have been made in a variety of cases. * * * It has been held that a meritorious defense need not be shown where the judgment is void, or at least where it is void on the face of the record, or where the judgment is void for want of jurisdiction, as where defendant was never served; but it has been held that a meritorious defense must be shown where the judgment recites facts sustaining jurisdiction, or where the judgment is voidable. It has been held that, a meritorious defense need not be shown where the default judgment was entered without authority, by mistake, irregularity, or improvidently, as where a judgment was taken by default before defendant’s time to answer had expired or after the case was at issue; but it has also been held that the fact that the judgment was irregularly entered does not dispense with the need of showing a meritorious defense. It has been held that a meritorious defense need not be shown where the judgment is fundamentally erroneous.

See also, 49 C.J.S. 537, Judgments § 290; 46 Am. Jur. 2d 901, Judgments §740.

We have acknowledged that there are exceptions to the rule. Even though the decision was rendered before the adoption of the civil code, it was recognized in Browning v. Roane, 9 Ark. 354, that we followed the general rule requiring that a party seeking relief from a default judgment show a meritorious defense, but it was also stated that there are proper exceptions. This court said:

We refer to these decisions not to adopt or approve them, but only to show that this general rule, requiring merits to be shown in order to relieve a party against a default, like most of the general rules of law, has been sometimes held to have exceptions, not only in an entire class of cases, but in other cases depending upon their own peculiar circumstances, and, although we are unwilling to go to the length of all the New York decisions on this subject, it is obvious that the rule must have some exceptions, as it is easy to conceive of cases, as for instance, where a default is taken against a defendant before the ■ expiratiom of the time allowed him to plead, where every possible presumption of law that a default could raise against him would be entirely removed by merely pointing out such gross irregularity as that indicated in the case supposed whereby he has been deprived of a substantive right. And while, by deciding the case before us, we design to declare no rule to embrace numerous cases of exceptions, we are of opinion that this case, under its peculiar circumstances, is as fully without the general rule as the case supposed.

Lately, in Halliman v. Stiles, 250 Ark. 249, 464 S.W. 2d 575, we recognized that in the absence of actual notice the due process impact upon statutory service requirements necessitated that there be strict construction of the statutes and exact compliance with their terms. In Halliman, where a direct attack upon a personal judgment was made, we specifically held that when personal jurisdiction is essential to a judgment in personam any adjudication based upon service which did not give the court personal jurisdiction over the judgment defendant was void, without regard to whether a meritorious defense was shown. We recognize that Halliman might be distinguished from this case because no personal judgment was rendered or sought here. Still, property rights are materially affected and our decisions have said that similar judgments, orders and decrees affecting property rights are void in terms that clearly do imply that they are not voidable only. We have recognized, as previously indicated, that due process requirements do also affect proceedings involving property rights.

We have also recognized exceptions in cases involving property rights. In Woolfolk v. Davis, 225 Ark. 722, 285 S.W. 2d 321, when a judgment was asserted as res judicata of certain issues before the court, we said that it was unnecessary to decide whether the attack made on the judgment was direct or collateral, because there was a total lack of service upon the defendants. Relying upon that case and Ark. Stat. Ann. § 29-107, we said that a foreclosure deed was void, where appellants had no notice, either actual or constructive, that the improvement district foreclosure suit would be, or had been, filed. We rejected the contention that it was incumbent upon the appellants to show a meritorious defense, and distinguished Davis v. Bank of Atkins, 205 Ark. 144, 167 S.W. 2d 876, by showing that the judgment in that case was voidable, but not void. Beck v. Rhoads, 235 Ark. 619, 361 S.W. 2d 545.

We have long recognized that there is a difference between void and voidable judgments. In McDonald v. Ft. Smith & W. R. Co., 105 Ark. 5, 150 S.W. 135, the attack was held to be collateral, but we emphasized the distinction, saying:

When a judgment is not a mere nullity, but only contains some defect which may become fatal and render it invalid, then it is only voidable, and, until it is actually annulled, it has all the force and effect of a perfectly valid judgment. Until by a proper proceeding, such judgment is reversed or vacated, it will be effective # * * as an estoppel or as a source of title. A judgment rendered by a court without jurisdiction is void; and, to have such jurisdiction, the court must have jurisdiction both over the subject-matter of the suit and the parties thereto.
* * * A judgment pronounced against one without notice is void; and section 4424 of Kirby’s Digest [Ark. Stat. Ann. § 29-107] is a statutory declaration of that principle.

In Nickles v. Wood, 221 Ark. 630, 255 S.W. 2d 433, we repeated the above language, and stated that the decision in McDonald had been cited with approval many times and never overruled.

Many of the decisions requiring the prima facie showing of a meritorious defense before a judgment is set aside for want of notice may spring from a misapplication of precedent in Sovereign Camp, Woodmen of the World v. Wilson, 136 Ark. 546, 207 S.W. 45. There we said that the presumption of regularity attending a judgment of a court of general jurisdiction could not be controverted except by showing that there was in fact no notice and that there existed a meritorious defense. The first case cited, Boyd v. Roane, 49 Ark. 397, 5 S.W. 704, was only relied upon to sustain the statement that there was a presumption of regularity attending a judgment of superior courts of general jurisdiction. In that case the court classified the attack as collateral because the suit was against a stranger to the decree and stated that the record in the case in which the decree attacked was entered showed that process was issued for the attacking minor and the decree recited an appearance of the parties. One of the cases relied upon as requiring the showing of a meritorious defense was State v. Hill, 50 Ark. 458, 8 S.W. 401, in which the court only treated the requirements to be met before a court of equity would vacate a judgment at law because of an officer’s false return of service of process. The other, Quigley v. Hammond, 104 Ark. 449, 148 S.W. 275, had nothing to do with lack of service of process, but related only to a proceeding to vacate a judgment on the ground that it was obtained through fraud. In Wilson, a summons was issued, so a cause of action was pending when the judgment was rendered.

In spite of the distinction between void and voidable judgments, we have decisions that can only be construed as requiring prima facie evidence of a meritorious judgment, even when the judgment is void for want of service of process. See, e.g.:

Chambliss v. Reppy, 54 Ark. 539, 16 S.W. 571 (the ground alleged as a basis for relief appears to have been fraud practiced by the successful party by falsely representing that there had been a proper returnof service of process upon the defendant, and the proceeding was brought under Ark. Stat. Ann. 29-506);
Nelson v. Freeman, 136 Ark. 396, 206 S.W. 667 (where the court held first that the party attacking the judgment was conclusively bound by a finding that he had been properly served);
Royal v. McVay, 180 Ark. 973, 23 S.W. 2d 983 (the court first held that the appellants were actually parties to an ex parte partition and then added that the decree was not void but voidable, even if appellants had not been parties to the proceeding and had been without knowledge of it);
Nichols v. Arkansas Trust Co., 207 Ark. 174, 179 S.W. 2d 857;
Haville v. Pearrow, 233 Ark. 586, 346 S.W. 2d 204.

There is a basis upon which many cases relied upon by appellant can be distinguished. First, there are those in which the question as to issuance or service of process was not raised:

Citizens Bank of Lavaca v. Barr, 123 Ark. 443, 185 S.W. 773; Hill v. Teague, 194 Ark. 552, 108 S.W. 2d 889; Overton v. Alston, 199 Ark. 96, 132 S.W. 2d 834; Abercrombie v. Richards, 248 Ark. 1322, 455 S.W. 2d 887; in Agee v. Wildman, 240 Ark. 1111, 398 S.W. 2d 542, appellant did not argue on appeal that there was no service. He argued that the service was constructive but we said that it was personal. The failure to prove a meritorious defense was considered fatal on appellant’s assertion that his failure to make timely appearance was unavoidable because he had no notice of the pendency of the action, service having been had on the Secretary of State under Ark. Stat. Ann. § 27-342.1 (Supp. 1971).

Then there are those cases in which this court classified the attack as collateral:

O’Neal v. B. F. Goodrich Rubber Co., 204 Ark. 371, 162 S.W. 2d 52; Davis v. Bank of Atkins, 205 Ark. 144, 167 S.W. 2d 876.

In some cases knowledge of the pendency of the action by the moving party was considered material, e.g., Merriott v. Kilgore, 200 Ark. 394, 139 S.W. 2d 387.

We are unable to ascertain the ground alleged for the vacation of the judgment in Osborne v. Lawrence, 123 Ark. 447, 185 S.W. 2d 774.

Other precedents may have sprung from a disregard, or misapplication of the distinction between a void judgment and a voidable one. See Royal v. McVay, supra; Davis v. Bank of Atkins, supra (where the court declared the judgment voidable without analysis of the distinction, over the strong protest of two dissenting justices).

There are also cases which seem to apply the requirement of a showing of meritorious defense stated in Ark. Stat. Ann. § 29-509 (Repl. 1962), upon the theory that, after the expiration of the term of court during which a judgment was rendered, the court can only set aside the judgment in a proceeding based upon Ark. Stat. Ann. §§ 29-506 — 512 (Repl. 1962). See Royal v. McVay, supra; Hill v. Teague, supra.

This continued requirement of the showing of a meritorious defense to a void judgment now impresses us as somewhat inconsistent with our following the rule stated in McDonald v. Fort Smith & Western R. Co., 105 Ark. 5, 150 S.W. 135, to permit a judgment to be disregarded as void on collateral attack. See Anderson v. Walker, 228 Ark. 113, 306 S.W. 2d 318. If a judgment can be disregarded on collateral attack, there is no sound reason why it should not be set aside on direct attack.

Appellant has not cited any case in which a prima facie showing of meritorious defense was a prerequisite to setting aside, on direct attack, a judgment, order or decree, rendered in a statutory proceeding unknown to the common law, for want of service or notice, where no action was actually commenced or pending at the time of the entry of the judgment, order or decree because there had not been a strict compliance with procedural requirements relating to the issuance of process or notice. In addition to other factors bearing on the service here, we point out that neither of the orders involved contained any recitals relating to process or service. We hold that under the circumstances prevailing here, the judgment was void, not voidable, and that there was no necessity for a showing of a meritorious defense. To hold that it was necessary would be contrary to our holding in such cases as Frank v. Frank, supra, that a court in proceedings such as this is without jurisdiction to make any final order affecting the rights of the defendants until a proper warning order has been published for four weeks and 30 days has elapsed after the appointment of the attorney ad litem.

Appellant contends that Ark. Stat. Ann. § 52-206 authorizes the appointment of a receiver to negotiate a lease upon the filing of the petition. We do not agree that this section is intended to authorize appointment before the action is pending. Actually, the appointment of a receiver and his negotiation of a lease are not merely incidental to the proceedings but are the ultimate remedies in the case. Under appellant’s theory a receiver could be appointed and his lease approved before expiration of the time for answer by any named defendant, whether served personally or constructively. This would not be consistent with our holding in Frank. Furthermore, even where the appointment of a receiver was made as an incident to the action, we said that the pendency of a suit is an absolute prerequisite to the appointment of a receiver, and unless made in a pending action, the court is without jurisdiction, and such an order appointing a receiver is void. District No. 21, UMW v. Bourland, 169 Ark. 796, 277 S.W. 546. This is not to say that a receiver can never be appointed in any case without previous notice of the application to the adverse party, as was done in Excelsior White Lime Co. v. Rieff, 107 Ark. 554, 155 S.W. 921. But in that case, it was not shown that there was no action pending at the time of the appointment.

We conclude that the chancery court did have the power to declare its own orders in this case to be null and void and that it properly did so. Accordingly, the decree is affirmed.

Byrd, J., dissents.

George Rose Smith, J., concurs.

      Appellant was not then represented by any of the attorneys representing him in the present proceeding.

       The proof of publication in the transcript so reflects. The transcript does not reflect that there is actually a warning order in the files in the case.

       In that case, one of the judges, who dissented in Davis, concurred, pointing out that the court was actually following his dissent in Davis, mentioned infra.


text:
    MCDANIEL BROTHERS CONSTRUCTION COMPANY v. MID-STATE CONSTRUCTION CO.
    5-5971
    482 S.W. 2d 825
    Opinion delivered July 24, 1972

      /. Winston Bryant and Wendell O. Epperson, for appellant.

      Joe W. McCoy, for appellee.
   John A. Fogleman, Justice.

Mid-State Construction Company sued McDaniel Brothers to recover $22,900.87 for dirt hauled to three housing project sites in Malvern, alleging that this balance was due on an oral contract. McDaniel Brothers denied owing Mid-State any balance and counterclaimed, seeking damages amounting to $10,-215 for breach of contract. The jury’s verdict on interrogatories resulted in a judgment of $12,500 in favor of Mid-State.

Appellant lists the following points for reversal:

I. The jury’s verdict in the amount of $12,500.00 in favor of the appellee is excessive and there is no substantial evidence on which the amount allowed could have been properly awarded by the jury.
II. The trial court erred in submitting special interrogatories Nos. 1 and 2 to the jury. The interrogatories were misleading in that they did not contain all of the elements of the contract and in addition, included controverted facts, which had the effect of misleading the jury.
III. The trial court erred in submitting plaintiff’s requested instruction No. 4, in that the instruction was misleading and does not conform to the applicable law regarding contracts.

Since Point II requires a discussion of the terms of the contract, we shall consider that contention first.

These are the interrogatories on which appellant’s Point II is based:

Do you find from a preponderance of the evidence that the Plaintiff, Mid-State Construction Company, only agreed or contracted with Defendant, McDaniel Brothers Construction Company, to clear and grub the three sites and to haul in fill dirt, level and compact the same to grade (blue top) on said sites? Answer: yes or no.
Do you find from a preponderance of the evidence that the Plaintiff, Mid-State Construction Company, in addition to its contract to clear and grub the three sites, haul in fill dirt, level and compact the same to grade (blue top); further agreed to haul in top soil, spread and fine grade the same on three sites? Answer: yes or no.

Appellant’s objection to both interrogatories was fundamentally the same, i.e., that both were misleading because neither incorporated all the elements of the contract between the parties. Appellants now argue that these interrogatories are broken down in such a way as to indicate that there were two separate contracts between the parties or, in the alternative, only part of the contract might have been entered into by the parties, so that the jury was misled into giving a negative answer to an interrogatory whether Mid-State abandoned or refused to complete its contract.

The basic issue in the case was the extent of the work contracted. McDaniel Brothers contended that Mid-State contracted to clear and grub the sites where the buildings were being, contructed by Mid-State, bring fill dirt to the sites and compact it to grade, and then haul in and spread a “fine grade” top soil.

The evidence as to the terms of the contract was very conflicting and confusing, to say the least. The original negotiations were conducted between M. B. (Rip) Evans, then a construction superintendent for appellee, and George Anderson, an engineer employed by appellant. Evans also had some conversation about the matter with J. B. Jones, McDaniel’s construction superintendent. At the time of the trial, both Evans and Jones had left these employers. Evans seems to have been operating a separate business of his own throughout, and he testified that he had gone to work for Jones. There was at least an inference that he was or had been working for McDaniel. On cross-examination he said he was trying to be fair about the matter, and wanted to stay neutral.

Sam R. Clark, president of appellee, testified that his company agreed to haul in select material for topsoil at $1.25 per cubic yard if it would meet specifications of appellant, but that McDaniel Brothers’ superintendent stopped appellee from hauling this material because he did not want to use it. The testimony about the superintendent’s stopping the hauling is not denied. Calrk admitted that Evans negotiated the contract with appellant, acting only on Clark’s instructions, and that the contract was oral in its entirety. He stated that Evans had no authority to enter into a contract, and that all contracts of his company had to be approved by him as president.

Doswell McDaniel, a partner in McDaniel Brothers Construction Company, said that Evans’ first offer was made to Anderson and did not include topsoil. He said that he and Evans later agreed orally on a contract for fill dirt at $1.15 per cubic yard and select material at $1.25 per yard. McDaniel claimed that this agreement was confirmed by his letter to appellee addressed to Mid-State Construction Company at Malvern, P. O. Box 104, to the attention of Evans. As abstracted by appellant, Clark’s testimony included these statements:

Our contractor contracted separately with Mid-State on the top soil because he wanted more money for select material and we had to separate it. Mid-State contracted to do the select material and to haul in the top soil. I mailed the letter, * * * I refer to the letter (Defendant’s Exhibit No. 1) and my letter of December 19, 1969, because we considered the earlier letter the contract. * * * We didn’t make any separation between fill dirt and top soil.

The first letter referred to was dated October 21, 1969, and stated the agreement as follows:

* * * we have agreed on the estimated quantities of actual haul in fill.
Yardage of haul in dirt; excluding topsoil to be installed in 6” lifts and compacted in accordance with plans and specifications-47,367 yards at a unit price of One Dollar and Fifteen cents ($1.15) per cubic yard.
Haul in dirt topsoil to be dumped and fine graded-12,271 yards at a unit price of One Dollar and Twenty-Five Cents ($1.25) per cubic yard. * * *
I shall appreciate your beginning this haul in fill as soon as possible, and payments will be made on a percentage completed basis, in accordance with the contract between McDaniel Brothers Construction - Company, and the Owners — the Housing Authority of the City of Malvern, Arkansas, with a ten percent (10%) retainage, until completed.
The unit prices shall include: grading and shaping of all street areas ready to receive base course gravel for the asphalt paving, compaction for fill under all building floor slabs, and line grading of the topsoil.
You mentioned the fact that it was not necessary that a contract be written. However, we are using this letter as a form of agreement and understanding, and thought it best to get this letter written as a matter of record of our agreement for this work.

The letter of December 19, 1969, made no mention of topsoil, but includes the following:

Our check is enclosed for the clearing sub-contract totaling $5,000.00 less 10% retainage, check net in the amount of $4,400.00.
*.v. .1;. ■7T- 'JJ'
Our sub-contract is in the mail to you for the lump sum amount of the haul-in dirt in accordance with your agreement with our Mr. Anderson and the writer.
I will be in Malvern one day next week and if you would like, we will evaluate the amount of dirt in place at that time and will bring the payments up to date for the material in place.

Clark denies having ever seen this first letter before the controversy arose. He testified that all Mid-State’s mail was picked up at the company post office box to which he, a Mr. Cox and a Mr. Gibbs, but not Evans, had keys. On rebuttal, Clark said that when Evans’ employment was terminated, he asked Evans to turn over everything in Evans’ possession. He said that Evans expressed worry because he had nothing in writing from McDaniel.

Evans testified that he assumed that the parties entered into a contract. He believed that his first conversations were with Anderson. Evans acknowledged receipt of the letter of October 1, 1969, and stated that it contained his understanding of the agreement, but said that Mid-State had already started work before the letter came. He said that he picked up company mail a few times, but could only "guess” that someone let him have a key to get it out of the post office. He guessed that he discussed the contents of the letter with Clark. He stated that he did discuss selling topsoil with Clark, who told him to go ahead and make a deal and recalled discussing this item with Jones on several occasions. According to Evans the contract for the topsoil was made while Mid-State was already engaged in "filling the job.” He was not at all clear about the stage the work had reached at that time. Evans reaffirmed his belief that “we” agreed to sell McDaniel Brothers topsoil, and was sure that he "was thinking” that the agreement was to take some strippings from across the river and haul them. He admitted that there was a possibility that Clark asked him during the last week of his employment with Mid-State if he had any papers or had made any contracts or had knowledge about anything of which he had not told Clark. He admitted a further possibility that Clark inquired about anything Evans had in connection with the Malvern Housing Authority. Evans then stated that he left all company files and he believed he left all letters. He could not recall whether the letter of October 31, 1969, was left.

Jones recalled that Evans told him that Mid-State would put in fill dirt at $1.15 per yard and that if the topsoil on Mid-State’s property was suitable to the Housing Authority, Mid-State would put it in for $1.25 per yard. Jones said that he did not negotiate the agreement on behalf of McDaniel, but that Evans said that the agreement as to topsoil was conditioned upon the suitability of the material to the Housing Authority. He remembered a conversation in the Sands Restaurant when, in the presence of Cox and Gibbs, Evans responded to Jones’ request for a price for the topsoil by saying that he could not quote a price, but would have to talk to Clark about it. McDaniel said that Jones had the authority to buy certain material on a local site, but not fine grading on pads.

For some reason, McDaniel Brothers sent a copy of letter, dated October 21, 1969, which they contended stated the terms of the contract, to Mid-State along with a letter dated June 23, 1970.

We cannot say that there was no substantial evidence to support either party’s contention as to the terms of the contract. Appellee contended and Clark testified that Evans had no authority to enter into contracts on behalf of Mid-State. Appellant argues that appellee ratified the acts of Evans. There seems to have been evidence to support such a theory, but we cannot say that the evidence was so clear as to eliminate any question of fact. We find no indication that this issue was raised by the pleadings or that it was otherwise asserted as an issue in the trial court. No instruction on this point was either given or requested.

We certainly cannot say that appellant would have been entitled to a directed verdict on this issue. Neither. can we say that the two interrogatories did not properly submit the issue or that they misled or tended to mislead the jury.

Passing to Point I, we cannot agree that there was no substantial evidence to support the jury award of $12,500 to appellee. In considering this evidence, we must view it in the light most favorable to appellee. The first work done by appellee was clearing and grubbing of the building sites, which included removing trees and stripping clay from the foundation sites and otherwise leveling them, for which Clark said appellee was to be paid $5,000. Clark estimated that appellee hauled in 58,000 cubic yards of fill dirt and compacted it to grade and specifications. On October 31, 1969, Mid-State billed McDaniel Bros, for 40,00,0 yards of material, without receiving any response. Another bill for $52,327.10 was rendered on December 10,1969, after which appellant sent a check for $29,816.-28. Evans later picked up another check for $12,778, bringing appellant’s total payments to $46,994.28, which included the amount agreed upon for clearing and grubbing less a 10% retainage. Clark said that this payment left appellant some $5,000 short on a $52,377 bill. This shortage apparently represented a 10% retainage. Clark admitted that all billings were based on estimates. Clark testified that on March 11, appellee billed appellant for a balance of $22,251.02, which seems to have been based on Clark’s estimate that Mid-State’s work was 95% complete. This contention was bitterly contested. Evans testified that he and Jones worked up most of the estimates on which Mid-State billed McDaniel. Evans said that he and Jones worked on the bill to McDaniel Brothers for $22,251.02, but that he was not sure that they were in complete agreement. Evans said that he calculated the bill on the basis of 95% completion. Jones admitted that he signed a statement that the contents of a letter from Clark, stating that appellee had hauled and compacted 55,761 cubic yards, were correct except as to an item of equipment rental and repair. On July 26, 1971, McDaniel wrote a letter to Mid-State asking confirmation of their balance with Mid-State at $18,866.50.

Doswell McDaniel estimated total yardage, including cut dirt, at 66,321 yards, which also included an estimated 12,271 cubic yards of topsoil. He admitted that the clearing and grubbing operations were satisfactorily carried out for the most part and that most of the performance by appellee was good up to the point where the bulk of the work had been completed and the need for small quantities was critical. He estimated the overall deficiency at 14% at that time but said that it later got worse. He claimed that appellant had to haul in 17,373 cubic yards to complete the job, only 12,500 of which should have been topsoil. McDaniel said that his company incurred expense amounting to $4,879.50 for equipment rental in completing the dirt haul. He said that they used their own dragline 240 hours which represented a cost of $4,800, a dirt crawler 470 hours, representing a cost of $4,700, and paid landowner royalties of $1,369 making a total of $13,500, from which he deducted $3,334, which he admitted would otherwise be due Mid-State. According to him, this left a balance due appellant by Mid-State of $10,215. Actually, McDaniel said that his company had hauled in an additional 1,906 yards of dirt and gave the contractors $760 for fine grading.

McDaniel calculated that Mid-State had hauled 44,-392 yards by June 23, 1970. He admitted that the ground was irregular, that the best estimate by survey was not accurate, and that more than the original estimated yardage was hauled in before the job was complete. Appellant had tendered appellee a check for the amount eventually deducted from the total that appellant credited against the counterclaim. He excused the use of the street areas for stacking materials by saying that the streets should have been graded before the materials were delivered. He also confessed that he had written a letter to Mid-State in which he stated that he was aware that the work could not have been done due to weather conditions.

Clark admitted that his billings were based upon rough estimates of percentage of completion made by him and Evans. Appellee had employed engineers to estimate the total yardage when the job was commenced, and Clark and Evans kept truckload accounts at first. Clark said that, contrary to appellant’s contention, Mid-State’s forces stood ready to complete the job and all delays were attributable either to weather conditions or interference with street shaping and grading by appellant’s using these areas as a site for unloading building materials.

Donald Brady, an engineer employed by appellee, estimated the total fill dirt to be hauled in to bring the sites to finished grade, including topsoil, was 58,700 yards. Brady said that his estimate was somewhat lower than McDaniel’s which was 67,000 yards but did not take into consideration a 3,000-yard cut on one site. He seemed to think that this might account for a part of the difference in the two estimates.

Appellant argues that the only basis for arriving at a verdict would be as follows:

Brady’s estimated yardage 58,700

Less McDaniel’s record of yardage hauled by appellant 17,400

41,300

41,300 yards at $1.15 $ 47,495.00

Less payments made 46.994.28

$ 501.62

Even if the $5,000 for clearing and grubbing were added and nothing was allowed on the counterclaim, the verdict would obviously be excessive if the jury had no other basis for its verdict.

On the other hand, the jury might have taken a different approach. It might have felt that Clark’s estimate of 58,000 yards was supported by other testimony, such as: McDaniel’s estimate of total yardage of 66,321, less 12,271 yards of topsoil, leaving a possible 54,050 yards, which was subject to adjustment because the irregular terrain made accurate estimation difficult; and Jones’ confirmation of an estimate of 55,761 yards placed on the job sites. This could have resulted in the following verdict:

58,000 yards at $1.15 66.700.00

Clearing and grubbing 5.000.00

Total 71.700.00

Payments made 46.994.28

Balance due $ 28,705.72

If the jury did so view the matter, there was considerable latitude for allowance of expenditures by appellant in completing the contract, without reducing the balance below $12,500. There was also considerable dispute about whether Mid-State owed McDaniel for rental on a piece of equipment.

Of course, the jury was not required to fully accept the testimony of either Clark or McDaniel on any feature of the case, or to credit Brady’s testimony to the exclusion of other evidence. Since there was substantial evidence to support a larger verdict, we cannot say that there was no substantial support for this verdict. See Fulbright v. Phipps, 176 Ark. 356, 3 S. W. 2d 49.

Appellant’s Point III related to appellee’s requested instruction No. 4 to the effect that an offer, which introduces a new term into a transaction, constitutes either a counter-proposal or an offer to treat but not an agreement. The objection made in the trial court was that the ins truc don was immaterial because there was no evidence that there was any counter-proposal subsequent to the formation of the contract. Even if it be said that Evans had authority to contract on behalf of appellee or that his unauthorized acts were ratified by his employer, still there was evidence that the discussions about topsoil did not arise until after appellee’s work on the job had commenced, that it was, at best, a conditional agreement or offer, and that appellant decided it did not want to use appellee’s material after three or four loads were hauled. We cannot say that the instruction was erroneous for the reason assigned.

On cross-appeal, Mid State asserts two alleged errors. One of them is that the jury was confused by the court’s interrogatory No. 8, which read:

On the basis of your answer to the above interrogatories what is the amount of damages the plaintiff is entitled to?

Appellee argues that the word “damages” was misleading to the jury because it sought recovery on a quantum meruit basis. Although the wording may not have been technically correct, after reviewing the instructions given and the other interrogatories, we do not see how the jury could have been misled.

The other point on cross-appeal has to do with the court’s failure to give AMI 101 after having indicated to the attorneys for the parties that it would do so. We have previously said that it is the better practice for the court to give this instruction when requested or recite into the record the reasons for not giving it in the unusually exceptional cases when a refusal to give it is justified. Smith v. Alexander, 245 Ark. 567, 433 S. W. 2d 157. The circuit judge’s comments were that the instruction was a long one, relating to the duties of the court, the jury and the attorneys, that he had read it to them many times, that he didn’t think it necessary that he read it again, unless the jurors wanted him to. Of course, if the instruction had been read to all the jurors on numerous occasions, the failure to repeat it might be justified. Appellee says, however, that only two other cases had been tried while the particular jury panel was serving, that three members of the jury had been members of the jury in only one case, and that six members had not been jurors in cither. Appellee admits that we cannot act on this information from outside the record. For that reason and because the objection of appellee to the failure to give the instruction was not on this basis, and could not have been a ground of a motion for new trial on which these matters could have been brought into the record, we are unable to say that there was reversible error in this case, just as we were in Smith v. Alexander, supra.

The judgment is affirmed. ,

      While McDaniel Brothers Construction Company is a partnership, we will refer to the McDaniels as "appellant.”


text:
    Opal Faye BURT v. HARTFORD ACCIDENT & INDEMNITY CO.
    5-6002
    483 S.W. 2d 218
    Opinion delivered July 24, 1972
    [Rehearing denied August 28, 1972.]

      Hodges, Hodges <k Hodges, for appellant.

      Hout, Thaxton ¿r Hout, for appellee.
   John A. Fogleman, Justice.

Appellant Opal Faye Burt was injured while working for Walmart Company and was paid workmen’s compensation benefits by Hartford Accident & Indemnity Company. Thereafter, she brought an action against D. T. Allen Construction Company, as a third-party tortfeasor, whose liability insuranee coverage was also furnished by Hartford. Appellant contended that this situation presented a conflict of interest which deprived Hartford of a lien on any recovery she might realize in her action against the alleged tortfeasor. Appellee then employed counsel, who filed an intervention seeking to establish a lien and seeking recovery from D. T. Allen Construction Company based upon allegations of negligence similar to those asserted by appellant. Hartford employed another firm of attorneys to provide a defense for the construction company. Appellant obtained a judgment of $3,000 in her tort acttion. The court recognized appellee’s lien, rendering judgment in its favor for the full amount of the workmen’s compensation benefits paid by it. Appellant contends that appellee was not entitled to any recovery because it was the liability insurance carrier for the tortfeasor. Alternately, appellant contends that the court erred in refusing to deduct a reasonable attorney’s fee from appellee’s recovery as a part of the reasonable costs of collection and that the court erred in allowing the carrier to fully recover its payments to appellant. We find no reversible error.

The record discloses that Hartford Insurance Group filed a petition to intervene, alleging that it had paid appellant $1,752.89 in workmen’s compensation benefits and asserting its right to join in the action and to make claim against any third party in the action who might be held liable for appellant’s injuries to the extent of these payments. The court allowed this intervention and Hartford Accident & Indemnity Company, a subsidiary of the Hartford Group, filed its complaint in intervention. It prayed for judgment against the alleged tortfeasor for the amount of the payments made and for a first lien on any judgment awarded appellant. Appellant filed an answer denying Hartford’s right to a lien and asked dismissal of appellee’s complaint in intervention.

At a pretrial conference, appellant raised her objection to appellee’s intervention. The attorney representing Hartford on the intervention stated that it really had no issue for the jury, that the law was clear as to its recovery and that it would introduce the final settlement receipt. Appellant then called attention to appellee’s allegations of negligence on the part of the Allen Company and the answer on behalf of that company denying negligence and demanded an election on the part of Hartford as to which pleading it withdrew. Appellant’s attorney also urged that the Arkansas statute would not permit Hartford’s claim of subrogation because of the conflict of interest. He did not then insist upon dismissal of appellee as a party to the intervention, but asserted that the grounds he had stated would be urged as a defense at the trial. Counsel representing Allen then moved to suppress any evidence on such a defense. The pretrial order permitted appellee to assert its claim for subrogation, struck appellee’s allegations of negligence and confined the intervention to trial of issues of negligence alleged in appellant’s complaint and its alleged right of subrogation, and directed appellant and her counsel to make no reference in the course of trial to liability insurance carried by the Allen Construction Company.

At the commencement of the trial, the court, on appellant’s motion in limine, prohibited the tortfeasor’s counsel from asking jurors on voir dire about any workmen’s compensation claim, but not from stating that the Hartford Group had intervened seeking part of any recovery of Mrs. Burt and then inquiring about any interest that any juror might have in the Group. At this time, appellee’s counsel on the intervention called attention to the fact that appellant had failed to answer its request for admissions and they were then admitted.

A pretrial discovery deposition of D. T. Allen showed that both appellant’s counsel and appellee’s counsel on the intervention had addressed inquiries to the witness. It is admitted that appellee’s attorney on the intervention did not interfere with appellant and her counsel in the trial of the case or take any step prejudicial to appellant’s rights.

Sustaining appellant’s argument would result in a windfall to her because of the fortuitous circumstance that the same insurance company was appellant’s employer’s workmen’s compensation carrier and the tortfeasor’s liability carrier. We find nothing in the letter or spirit of our Workmen’s- Compensation Act to indicate any such result. Appellant admits inability to furnish statutory or case authority to support her position and we know of none. Appellant directs our attention to a statement at 2 Larson 226.83, § 74.16 (1970), included in a discussion of the problems raised by subrogation statutes and the importance of the statute’s affording both the employee and carrier a fair opportunity to press a damage suit against a third-party tortfeasor, if the other neglects to do so. The statement quoted simply recognized that the problem of providing an opportunity and an incentive to both employee and carrier is aggravated by the increasing prevalence of conflicts of interest when a carrier is the injured claimant’s subrogee and the defendant’s liability insurance carrier. Nowhere do we find a passage where Professor Larson indicates that subrogation should not be allowed under these circumstances.

Appellant argues that dangerous consequences are inherent because cooperation between the claimant and carrier would be virtually impossible, the attorney for the claimant could not represent both parties and the insurance company gains a windfall. We do not understand how a windfall to the insurance company would result. Other fears of appellant can be appropriately alleviated by judicial action. We find the holding in Varney v. Taylor, 71 N.M. 444, 379 P. 2d 84 (1963) pertinent and in harmony with our decisions and the provisions of our workmen’s compensation statute. There the New Mexico Supreme Court reversed a trial court decision to deny the right of intervention under these circumstances, all the while recognizing the employee-plaintiff’s understandable disturbance at the prospect of an unwanted and uninvited guest at the counsel table. That court held that the carrier’s intervention should be permitted but only under such circumstances as would protect the rights of all parties to the litigation. The court felt that the issue had been satisfactorily treated in a previous case by granting a summary judgment in favor of the intervenor which was not to be made a matter of record until the trial was complete. The New Mexico court said that the intervention in these circumstances should not be made final but the carrier should be precluded from participating as a party plaintiff in the interim. The action of the trial court here was substantially in accord with that holding and was appropriate under the circumstances. Of course, if the claimant gives proper recognition to the carrier’s subrogation rights and stipulates its right to a lien, there is no reason why the claimant’s attorney cannot proceed with a trial against a third-party tortfeasor without interference by the carrier or its attorney.

It is conceded that counsel for appellant prepared the case against the tortfeasor, made the opening statement and closing arguments, examined all witnesses and prepared and presented all jury instructions proposed on behalf of appellant. The intervenor’s attorney’s only participation in the actual trial was in the reading of a deposition. When appellee moved for enforcement of its subrogation lien against the proceeds of the judgment, appellant continued to resist. In the alternative, appellant sought to have attorney’s fees amounting to one-third of the total amount of appellee’s workmen’s compensation payments allowed as part of the reasonable costs of collection allowed by statute. Appellant contends that Hartford should bear a part of the attorney’s fees for this recovery because the conflict of interest prevented cooperation between counsel.

We have held that it is proper for the court before which a tort action resulting in a judgment in favor of an injured employee has been tried to determine the reasonable costs of collection to be deducted from the amount to be paid to the intervening carrier which has paid compensation benefits to the employee. Winfrey & Carlile v. Nickles, 223 Ark. 894, 270 S.W. 2d 923. In that case, we recognized that in the usual situation the question of allowance of fees to the employee’s attorney as part of the costs of collection would not likely arise, because the intervening carrier would either retain the employee’s counsel for a fee mutually agreed upon or would employ another attorney of its own choice. Thus, we said, the court would simply apportion the recovery, leaving each to pay his own attorney. We added that in the normal situation the carrier would incur liability for an attorney’s fee in the course of pursuing the tortfeasor. We recognized, however, that the normal situation does not prevail when the carrier has a conflicting interest as the tortfeasor’s liability carrier, because there is little likelihood that the carrier will engage the employee’s attorney or that the attorney employed by the carrier will be of assistance to the injured party’s counsel. We found no error in the allowance of attorney’s fees on the carrier’s share of the recovery under the circumstances there.

Quite a different situation prevailed here, however. Appellant took, and still maintains, an adamant position that the carrier had no rights in the matter at all, and no lien on her recovery. This theory does not seem to have even been suggested in Nickles and certainly was not an issue on appeal, as it is here. Appellant concedes that appellee was forced to employ an attorney to assert its rights because of her opposition to its intervention. Even though the actual participation of appellee’s counsel on its intervention after the trial commenced was not substantial and even if it be conceded that there was no cooperation between appellant’s and appellee’s attorneys, appellant’s action certainly jeopardized the appellee’s right to subrogation and necessitated not only the presence of appellee’s attorney, but a zealous attention to the protection of his client’s rights from the filing of the third-party suit until now. This is not a case of the carrier’s accepting the benefits of the services of the employee’s attorney without any necessity for the employment of an attorney by it or its choosing to depend upon the efforts of the employee’s attorney without taking any part in the proceedings whatever. In view of the circuit judge’s superior ability to evaluate the situation (which we emphasized in Nickles), we cannot say that he committed error in regard to the costs of collection allowed.

Appellant also contends that, under Ark. Stat. Ann. § 81-1340 (Repl. 1960), Hartford was not entitled to more than the two-thirds of the amount of benefits paid by it. We cannot so read the statute. Arkansas Statutes Annotated § 81-1340 (a) (1) clearly provides that an intervening employer or carrier shall be entitled to a lien upon two-thirds “of the net proceeds recovered in such action that remain after the payment of the reasonable costs of collection, for the payment to them of the amount paid and to be paid by them as compensation to the injured employee. . . ” Arkansas Statutes Annotated § 81-1340 (a) (2) provides that one-third of the remainder of the amount recovered by the employee, after deduction of reasonable costs of collection, shall belong to the injured employee, and the remainder, or so much thereof as is necessary, goes to discharge the actual amount of the liability of the carrier with any excess belonging to the employee. The language of the statute rejects appellant’s argument.

The judgment is affirmed.

Jones J., dissents insofar as the decision relates to the denial of attorney’s fees as part of the cost of collection.


text:
    Russell W. PARKER v. STATE of Arkansas
    5741
    482 S.W. 2d 822
    Opinion delivered July 24, 1972

      Fitton, Meadows & Adams, for appellant.

      Ray Thornton, Atty. Gen., by: John D. Bridgforth, Asst. Atty. Gen., for appellee.
   John A. Fogleman, Justice.

Appellant Russell Parker was convicted of manslaughter by a jury following his trial for murder in the first degree. For reversal he alleges that the trial court erred when it denied his motion for a directed verdict and when it refused to call Rosemary Tones as the court’s witness. A review of the proceedings and evidence indicates that there was no error.

A verdict should be directed only when there is no factual issue to go before the jury. Keese v. State, 223 Ark. 261, 265 S.W. 2d 542; Ford v. State, 222 Ark. 16, 257 S.W. 2d 30. On appeal, in criminal cases, as in others, the evidence must be viewed in the light most favorable to the appellee, and the judgment affirmed if there is any substantial evidence to support the jury’s verdict. Murphy v. State, 248 Ark. 794, 454 S.W. 2d 3021; Stanley v. State, 248 Ark, 454 S.W. 2d 72. A conviction may be had on circumstantial evidence alone if there was substantial evidence to go to the jury because the law makes no distinction between direct evidence of a fact and evidence of circumstances from which the existence of the fact may be inferred. Lancaster v. State, 204 Ark. 176, 161 S.W. 2d 201. In light of the foregoing rules we state the evidence which we find sufficient to make a jury question.

Richard Sanders had been visiting the appellant, staying in his cabin. All seemed to be going well until the Saturday night before the death of decedent Claude Still. Sanders had gone to sleep at the cabin but was awakened by Parker, who, Sanders said, had returned intoxicated, at about 3:00 a.m., after which the two had “words.” He further testified that Parker threatened to kill him and that he thought it best to leave. Sanders admitted that he was “tight.”

Sanders left without taking all of his clothes and equipment with him. It would have been necessary to have borrowed Parker’s four-wheel drive International Scout to take his belongings from appellant’s cabin to the place where Sanders had parked his vehicle, but Parker refused to lend him the Scout. Sanders met the younger Still and his father, D. C. Still, along the way and told them of his recent problems with Parker. Claude Still agreed to go back with him to appellant’s cabin to help him collect his gear in safety. Claude kne,w Parker and said that he could “cool him down.” Before going to the cabin Still armed himself with a .38-caliber revolver and a .45-caliber semi-automatic carbine. It appears that decedent also had been drinking.

Upon reaching the cabin Sanders hid behind some bushes while Parker and Claude Still talked. He saw them “square off” at each other, but Parker did not pursue the matter. After that it appeared to Sanders that Parker and Still were then “getting along great.”

Meanwhile Melvin Collins and his wife, who were taking a float trip on the Buffalo River, approached. They also had seen Parker and Still involved in menacing gestures. Melvin Collins also heard Parker threaten Sanders. Later though, it appeared to them that Still and Parker were getting along well. They said that there was drinking by all these persons and that they had given some of their beer to them.

Parker, Sanders and the decedent went to the cabin in the Scout and returned with Sanders’ belongings. These were stowed in the Collinses’ boat, and Sanders left with them. Still, left with Parker in the Scout, ostensibly to meet Sanders and the Collinses on the other side of the river. There was evidence that: the .38-caliber pistol was on the seat between the two; the carbine also was carried with them; Parker carried a .22-caliber rifle; Still was driving.

Mrs. Collins testified that Sanders fired a gun into the water. Shortly thereafter she heard some “hollering down the river” from the direction in which Parker and Still had headed. Then she heard three shots which sounded as though they had come from thé same place. Melvin Collins’ testimony was essentially the same. However, he also stated that Parker was “pretty drunk,” drinking heavily, staggering and slurring his words. All three witnesses testified that it had rained that afternoon.

D. C. Still stated that Claude did not come to work on Monday. The elder Still talked with Melvin Collins on Tuesday and was told of the events on Sunday. At this time he was not worried about his son because he had seen Parker recently at “Hall’s place.” However on Thursday he and Collins began a search for Claude. They found him in a “hole” of water away from the river. They also found the carbine lying at the decedent’s feet, but they were unable to find the .38-caliber pistol. They noticed a single set of tire tracks, which looked like those of Parker’s Scout, that crossed the river, came out on the other side and led to appellant’s cabin.

Sonny Wood, Claude’s brother-in-law, also went down to where the body was found. He said that the tracks were deep and appeared to have been made by a “mud or snow type” tire. He said that a check of the tires on Parker’s Scout revealed that they were mud or snow tires.

Fred Bearden, the sheriff of Marion County, testified that he had investigated the matter. He said that, in following the tire tracks, he noticed a place where some vehicle had bumped into a big rock along the side of the road. Part of the rock had been chipped off. Wood said that Parker’s Scout had a “dent and a banged up spot where. . . it looked to me that was the vehicle that had hit the rock.” He also testified that a second inspection of the vehicle revealed three or four spots that looked like drops of blood.

It was stipulated that Claude Still died from multiple gunshot wounds and that all bullets removed from his body were .38-caliber.

In a case strikingly similar to this one, arising out of the Western District of Arkansas, the testimony reflected that the deceased and the accused, one Bood Crumpton, after having spent the night together, rode off to visit some women who lived four miles away. Crumpton was armed with a pistol. About noon of that day shots were heard in the direction of where the body was later found. Toward evening of the same day Crumpton was seen returning to the house at which both had previously stayed. Crumpton told others that the decedent had left with another person in the latter’s buggy and that the decedent asked him to bring his horse back, take charge of all his effects and pay his debts if he did not return by a certain time. The body was not found for more than a month. It was .shown that the accused was familiar with the area where the body was located. The court said, “There is no doubt that this testimony was sufficient to lay before the jury, and it would have been improper to [have] direct [ed] a verdict for the defendant. The weight of the evidence and the extent to which it was contradicted or explained away by witnesses on behalf of the defendant were questions exclusively for the jury. . .” Bood Crumpton v. United States, 138 U.S. 361, 34 L. Ed. 958, 959, 11 S. Ct. 355 (1891).

We are well aware of Johnson v. State, 210 Ark. 881, 197 S.W. 2d 936, where we reversed the judgment of the trial court in which circumstantial evidence was used in convicting the defendant, but it is easily distinguished from the case before us. It is unnecessary to restate the facts in that case because the distinguishing features are clearly stated in that opinion. There we reversed, not because the conviction was based solely on circumstantial evidence, but, because the circumstances were not sufficient in the absence of any evidence of motive or cause for the alleged homicide. We noted that the state made no showing of trouble between the parties, nor ill will on the part of the defendant toward the deceased, nor proof that robbery could have been a motive.

The situation is different here. There was testimony from which it would not have been unreasonable for the jury to have concluded that: appellant was angered by the decedent’s aiding a man he had previously threatened to kill; Parker, surrounded by Still, Sanders and the Collinses, only feigned friendliness in order to get the deceased to leave the others and come with him; the dent found on Parker’s Scout along with the spots of blood sufficiently identified it as the vehicle whose tracks were found at the scene of the crime; the blood on the vehicle originated from Still’s wounds; and Parker used the .38-caliber pistol which was on the seat between them to kill Still. Both of the Collinses and Sanders had testified about hearing shouts and pistol fire coming from the direction toward which appellant and Still had gone. The terrain where the body was found was too rough for the ordinary vehicle to traverse. When we consider all this testimony, we are unable to say that there was not sufficient evidence to present a jury question.

We now consider appellant’s contention that the denial of his request to have Rosemary Jones called as a witness of the court was error. In his opening remarks to the jury the prosecutor indicated that Ms. Jones had talked with appellant and asked him if he had seen Still; Parker said the last time he had seen the decedent he was with Melvin Collins and Dick Sanders; she told Parker his story wasn’t true, and he then told her something else. This witness was not called by the state. Appellant sought to have her called as the court’s witness so that he would be free to impeach her testimony. This was refused.

The calling of a witness as the court’s witness in a criminal case, either for or against the accused, is a matter resting in the sound discretion of the court. Smith v. United States, 331 F. 2d 265 (8th Cir. 1964), cert denied, 379 U. S. 824, 13 L. Ed. 2d 34, 85 S. Ct. 49 (1961); 2 Wharton’s Criminal Evidence § 704 at 171 (12th Ed., 1955); 58 Am. Jur., Witnesses § 4 at 25; 98 C.J.S. Witnesses § 850 at 71; An-not. 67 A.L.R. 2d 588 (1959). In the instant case the trial judge offered to call Ms. Jones as a court’s witness to ask her specifically whether or not the events related in the prosecuting attorney’s opening remarks had in fact occurred. The court also offered to instruct the jury that the prosecuting attorney had failed to call Ms. Jones and that the jury should disregard the statements attributed to her. Both offers were rejected by appellant. However, the instructions read to the jury contained the standard instruction that opening statements were not evidence and should not be considered as such by the jury. Appellant makes no claim, either below or here, that Rosemary Jones was an eyewitness to any of the events forming the basis of appellant’s prosecution nor did he make any showing that he feared to call her because he was unable to vouch for her veracity. See People v. Robinson, 14 Ill. 2d 325, 153 N.E. 2d 65 (1958); People v. Laster, 413 Ill. 224, 108 N.E. 2d 421 (1952); People v. Cardinelli, 297 Ill. 116, 130 N.E. 355, (1921); 67 A.L.R. 2d § 3 at 544, et seq. When we consider all of these factors we find no abuse of discretion.

The judgment is affirmed.