author: George Rose Smith, J. Jim Johnson, Associate Justice,

text:
    Jones v. Duckett.
    5-2672
    356 S. W. 2d 5
    Opinion delivered April 9, 1962.

      Francis T. Donovan, for appellant.

      George F. Hartje, Jr., for appellee.
   George Rose Smith, J.

In the fall of 1960 a dispute arose between the appellant, Guy H. Jones, and the appellee, John T. Duckett, about, which of the two was the chairman of the Faulkner County Central Committee of the Democratic party. By law the chairman of this committee is automatically a member of the County Board of Election Commissioners, concededly a public office. Ark. Stats. 1947, § 3-607. In an effort to obtain a judicial decision in the matter Jones brought this action in the form of a proceeding to obtain redress for a usurpation of office. He alleged in his complaint that he was rightfully a member of the County Board of Election Commissioners and that Duckett had wrongfully deprived him of the office. The circuit court, sitting without a jury, found in favor of the defendant, principally upon the ground that Jones was a state senator at the time and was therefore ineligible to hold another public office.

The record is large, but in the view we take only a few of the facts, all undisputed, are material. By party rule the county chairman is elected by the county central committee. On August 27,1960, Jones was elected by the Faulkner county committee as its chairman. Senator Jones was then serving a four-year term as a member of the state senate. That term was to expire on January 1, 1961 (Ark. Const., Amendment 23, § 6), and he had been defeated as a candidate for renomination in the Democratic primary earlier in August.

Later in the fall some of the county committeemen had reason to doubt Jones’s eligibility to hold the position of chairman. At a county committee meeting held on October 8,1960, at which Jones does not consider that a quorum was present, Duckett was purportedly elected as chairman in the place of Senator Jones. One week later Jones brought this action for usurpation of the office of county election commissioner.

In a usurpation proceeding the plaintiff seeks to recover possession of the office; so it is logically his burden to establish his qualifications to hold the office. Rosser v. City of Russellville, 306 Ky. 462, 208 S. W. 2d 322. Our usurpation statute is in harmony with this view, for it provides that the person entitled to the office shall be reinstated therein by the judgment of the court. Ark. Stats., § 34-2207. The legislature could not have meant to direct the court to install an ineligible person in public office.

By the plain language of Article 5, § 10, of our constitution Senator Jones was ineligible to hold another civil office: “No Senator or Representative shall, during the term for which he shall have been elected, be appointed or elected to any civil office under this State.” This mandate was given effect in Wood v. Miller, 154 Ark. 318, 242 S. W. 573, and in Collins v. McClendon. 177 Ark. 44, 5 S. W. 2d 734. We recently held in Johnson v. Darnell, 220 Ark. 625, 249 S. W. 2d 5, that a state representative might, during his term of office, be elected to another office if his tenure therein would not begin until after the expiration of his term of office as a legislator. That was not the situation in the case at bar.

In arguing that he was not disqualified to become a county election commissioner while he was serving as a state senator the appellant suggests that he was only nominally a member of the legislature after his defeat in the August primary. The clear-cut answer to this, argument is that Senator Jones’s’ term of office continued until January 1, 1961, and the duration of that term is the controlling consideration in deciding his qualification to hold another civil office. Had the legislature been called into special session between the August primary and J anuary 1 it would have been Senator J ones’s unquestioned duty to attend the session as the senator from his district.

The remaining argument is that Jones was not “appointed or elected” to the office of county election commissioner, since it devolves by operation of law upon the county chairman. We think it evident that the constitutional inhibition against a legislator’s being appointed or elected to another office was intended to embrace the only two methods by which a person is ever chosen for public office under our law. Here Senator Jones was elected to the position of county chairman and by that election he would have become, if eligible, a county election commissioner. It follows that he was elected to the latter office within the meaning of the constitution.

It is also insisted that Senator Jones, despite his ineligibility to hold the office of county election commissioner, is qualified to be chairman of the county central commmittee and should have been awarded that position by the trial court. Assuming, without so deciding, that the courts now have jurisdiction of such a contest (see Tuck v. Cotton, 175 Ark. 409, 299 S. W. 613, and Act 21 of 1949, Ark. Stats., § 3-245), we think the court was right in holding that Jones’s inability to aet as a county election commissioner also prevented him from being county chairman for the party. Each county board of election commissioners consists of three members: The county chairman of the majority party, the county chairman of the minority party, and a third commissioner appointed by the State Board of Election Commissioners. Ark. Stats., § 3-607. There is no provision for anyone to be named as a replacement for a county chairman who is ineligible to serve on the county board of election commissioners. Consequently if a party leader could act as county chairman of the party in spite of his ineligibility to serve on the county board of election commissioners it would leave the latter body with only two members. In that event the board might be powerless to perform its duties, owing to a tie vote between its two commissioners. Hence we are convinced that the legislature intended for the county party chairman also to be qualified for service as an election commissioner. Since Senator Jones was not so qualified the court correctly held that he was ineligible to serve the party as its county chairman.

Affirmed.

Johnson, J., dissents.

Jim Johnson, Associate Justice,

dissenting. The case of Johnson v. Darnell, 220 Ark. 625, 249 S. W. 2d 5, upon which the majority rely for affirmance, to say the least, is somewhat ambiguous. There this Court said:

“Although the original Constitution authorized the General Assembly to fix election dates, quite clearly the injunction against members of the General Assembly ‘being appointed or elected to any civil office’ was written at a time when the newly elected group of Senate and House members would immediately supersede those who had served until the particular election. If we should now say that with the Act of 1875 and Amendment No. 23 a Senator or a Representative is ineligible within the strict construction contended for by appellant, then neither a senator nor a representative whose term did not expire until January could be a candidate in the November election to succeed himself. Certainly these are civil officers. We might read into Section 10 of Article 5 the word ‘other’ and perhaps reach a common sense construction. However, it appears most likely that the language was meant to apply to the period of service under the election. This would be in harmony with the status in 1874 when there was no interim between election and beginning of the term to be served. When Amendment No. 23 was written, and when it was adopted by tbe people, tbe view suggested must have been in tbe public mind, and we are unwilling to say that the fundamental touched upon was intended, to be foreclosed with tbe use of tbe word ‘elected’. Tbe better view would be that tenure of office was contemplated as distinguished from tbe elective process by which tbe right to bold such office is acquired.”

It is possible that tbe Court by tbe use of tbe above quoted language meant to say what tbe majority in tbe present case contend, i.e., “that a state representative might, during bis term of office, be elected to another office if bis tenure therein would not begin until after tbe expiration of bis term of office as a legislator,” but to me tbe only thing unambiguous about tbe language of tbe Darnell case is that tbe adoption of Amendment 23 effectively repealed tbe clear terms of Article 5, Section 10 of our Constitution. At least tbe Darnell opinion was a recognition of tbe obvious and that is, since tbe adoption of Amendment 23, a strict interpretation of Article 5, Section 10,' is no longer possible. This being true, upon tbe whole case before me as opposed to tbe narrow point upon which tbe majority reached their conclusion, I am convinced that appellant should prevail, otherwise, the Democratic Party rule providing for a person other than an elected committeeman serving as chairman of tbe County Committee could serve no practical purpose which would have justified its adoption.

For tbe reasons stated above, I respectfully dissent.


source: Caselaw Access Project

author: Paul Ward, Associate Justice. Ed. F. McFaddin, Associate Justice,

license: Public Domain

text:
    Vernon v. McEntire.
    5-2637
    356 S. W. 2d 13
    Opinion delivered April 9, 1962.

      Wiley A. Branton, for appellant.

      Jay W. Dickey, for appellee.
   Paul Ward, Associate Justice.

This is the second appeal involving the same parties and the same 80 acres of land in Jefferson County. In the first opinion (Vernon v. McEntire, 232 Ark. 74, 339 S. W. 2d 855) it was held that Luchers Vernon and his wife had the right to redeem the land from the McEntires. The background facts are set forth in that opinion.

When the mandate on the first opinion was filed in the trial court no further pleadings were filed by either party. At the beginning of the second hearing the trial court correctly stated the issues in the following language :

“The sole question before the Court is whether the McEntires, appellees in the case of Vernon v. McEntire, 339 S. W. 2d 855, have made improvements on the land in controversy since the Decree of this Court and if so, whether they are entitled to be compensated for said improvements in addition to being compensated for taxes and insurance premiums they paid. Also, the question of rents due the Vernons is before the Court.”

At this hearing it was agreed that the record on the first appeal would be considered as a part of the record on this appeal, but testimony was also introduced by both sides on the issues as above defined. It is agreed by both parties that the Vernons owe the McEntires the sum of $3,100 (as principal) on the purchase price of the land.

At the conclusion of the hearing the trial court, after first fully setting out its reasons, found the account between the parties to be as follows:

Appellants owe appellees
1. 1,100.00 592.57 Balance on land Q°/o interest, 1-1-58 to 3-31-61
2. For permanent improvements 2,000.00
3. 1958-1960 taxes 6% interest to 3-31-61 Total 531.52 68.37 $6,292.46
Appellees owe appellants
1. $ 400.00 Rent on land 6% interest, 1-1-61- to 3-31-61 6.00
2. House sold from land 6% interest, 4-17-60 to 3-31-61 65.00 3.65
3. Costs, first appeal 6% interest, 12-15-60 to 3-31-61 137.50 2.38 $ 614.53 Total

Accordingly the trial court decreed it would be necessary for appellants to pay appellees the sum of $5,677.93 in order to redeem the land, giving appellants 10 days to deposit said amount in the registry of the court, otherwise fee simple title would vest in appellees.

Appellants in prosecuting this appeal object to only two items in the decree rendered by the trial court. One is the $2,000 allowed appellees for improvements and the other is the date from which interest was allowed on the $3,100 balance.

One. We agree with appellants’ contention that appellees are not entitled to reimbursement for money-spent in making improvements on the land. We reach this conclusion because we find no evidence in the record to support a finding that appellees acted in good faith (as defined by this Court) when they made the improvements. It may be conceded, for the purpose of this opinion, that appellees spent $2,000 in clearing, draining, ditching, etc. on the 80 acres of land, but we do point out that the amount of recovery for improvements under the Betterment Statute is based on the enhanced value of the land and not on the cost of improvements. See: Wallis v. McGuire, 234 Ark. 491, 352 S. W. 2d 940. We find no evidence of enhanced value in this case.

There are two ways or theories by which appellees could seek recovery for improvements in this case, providing, of course, they had proven the enhanced value of the property. One, under Ark. Stats., § 34-1423 (commonly known as the Betterment Act) and the other would be to enforce an equitable right, as recognized in Foltz v. Alford, 102 Ark. 191, 143 S. W. 905. However, in either event, there can be no recovery for improvements unless made in good faith. Therefore, it is in order now to find out how this Court has defined “good faith” when used in this connection.

A case closely in point on principle is Douglass v. Hunt, 98 Ark. 320, 136 S. W. 170. In that case Hunt testified:

“. . . he was advised by attorneys of well known learning and integrity that his deed from Lovejoy conveyed the title in fee simple, and that he occupied and improved the land in the honest belief that he had a perfect title. He testified, however, that both before and after he purchased the land from Lovejoy he received information that appellants, who were the children of Mrs. Hackney, were going to lay claim to the land at her death.”

There, in denying Hunt’s claim for improvements, we said: “ ‘It must be an honest belief and an ignorance that any other person claims a better right to the land. ’ ’ ’

In the case of Graves v. Bean, 200 Ark. 863, 141 S. W. 2d 50, the Court, in dealing with this same question, made the following statement:

"Cases as to the good faith required are illustrated by such authorities as Patton v. Taylor, 144 Ark. 254, 224 S. W. 49; McDonald v. Rankin, 92 Ark. 173, 122 S. W. 88; Foltz v. Alford, 102 Ark. 191, 143 S. W. 905, Ann. Cas. 1914A 236.
“One chargeable with notice as to the kind of title he holds certainly may not, under the foregoing authorities, make such improvements as will impair the title in fee.”

In the same connection the Court also said:

“It can serve no beneficial purpose or interest to enter upon any extended discussions of these matters as her estate must fail in the event she did not make the improvements under color of title or in event that she did not make them in that good faith within the meaning of that expression as defined.”

In Patton v. Taylor, 144 Ark. 254, 222 S. W 49., the test of good faith was put this way :

“To entitle an occupant to remuneration for his improvements, the test of good faith is: Did he make them in the honest belief that he was the true proprietor and in ignorance that any other person claimed a better right to the land?”

Likewise, in the case of McDonald v. Rankin, 92 Ark. Ark. 173, 122 S. W. 88, the Court, after reviewing at length many cases on the meaning of good faith, said:

“From all these cases it will be seen that the cardinal requisite that the occupant should possess is good faith, and an honest belief in the title under which he occupies the land, and an ignorance of his title being questioned by another who claims a better right, in order for him to be entitled to the benefits of the statute.”

The meaning of good faith was very clearly restated in Welch v. Burton, 221 Ark. 173, 252 S. W. 2d 411, this way:

“The statute governing betterments is Ark. Stats. 34-1423, and runs in favor of anyone believing himself to be the owner. This has been interpreted to refer to anyone who acts in good faith and our cases define good faith, and places the burden of proof on the claimant. Greer v. Fontaine, 71 Ark. 605, 77 S. W. 56. In Beard v. Dansby, 48 Ark. 183, 2 S. W. 701, it was said that good faith consists of ‘ an honest belief and an ignorance that any other person claims a better right to the land’.”

Applying the definition of the words “good faith” as so clearly set forth in the previously cited cases, we cannot escape the conclusion that appellees were not acting in good faith when they made the improvements for which they seek recovery here. As stated in the Burton case, supra, the burden was on appellees to prove good faith. It can hardly be seriously contended that appellees did not know appellants were claiming title to the land at the very time they (appellees) were making the improvements thereon. The pertinent facts on that question are set out below.

The earliest date any improvements were made by appellees was in February, 1960 after taking possession of the land in January of that year. Did appellees know in February, 1960 that appellants were claiming title to the 80 acres ? Obviously the answer is that they did know. The record on the first appeal which is a part of the record on this appeal, shows that on January 30, 1959 appellants filed a complaint against appellees in which they asked the court to require appellees to convey title to them. It also shows that on November 10, 1959 the trial court refused the relief asked for by appellants. It further shows that on November 30, 1959 appellant filed a notice of appeal to this Court. Appellees do not disclaim knowledge of appellants’ intention to appeal nor are they in any position to do so, because Section 3 of Act 555 of 1953 required the clerk to give them written notice. Therefore when appellees began making improvements on the land some two months later (February, 1960) they did know appellants were still claiming title to the land, and also that appellants were prosecuting that claim in court. That being true, appellees proceeded to make improvements at their own risk, and it cannot be said they did so in “good faith” as those words have been defined by this Court.

Two. The trial court also erred in requiring appellants to pay interest on the balance of $3,100 from January 1, 1958. The trial court fell into this error because it found appellants had never made a tender of payment to appellees. In our opinion on the first appeal we made the specific finding that appellants did make such tender, and that finding is not subject to change after the opinion became final. Appellants cannot be charged with interest on the $3,100 after the tender was made. Although appellants necessarily made the tender before they filed the original complaint on January 30, 1959 yet, in the absence of proof of the exact time, we will give appellees the benefit of the uncertainty and fix the date of tender as of January 30, 1959. This means that appellants are charged with interest from January 1, 1958 to January 30, 1959 but not thereafter.

Except for the two items above discussed the decree of the trial court is affirmed.

For the errors above indicated and to that extent the decree is reversed, and the cause is remanded with instructions to enter a decree not inconsistent with this opinion.

Reversed and remanded.

Harris, C. J., and McFaddin, J., dissent.

Ed. F. McFaddin, Associate Justice,

dissenting. I respectfully dissent from the reversal because I would affirm in all respects the Decree of the Chancery Court; and here are my reasons.

I. The $2,000.00 For Improvements. This amount should be allowed the appellees under the doctrine of unjust enrichment; i.e., under the facts here, the appellants would be unjustly enriched to receive the benefit of the appellees’ labors and expenditures without paying therefor. In 46 American Jurisprudence 99, under the topic “Restitution and Unjust Enrichment” the rule is. stated:

“It is a general principle, underlying various legal doctrines and remedies, that one person should not be permitted unjustly to enrich himself at the expense of another, but should be required to make restitution of or for property or benefits received, retained, or appropriated, where it is just and equitable that such restitution be made, and where such action involves no violation or frustration of law or opposition to public policy, either directly or indirectly. . . . Unjust enrichment arises not only where an expenditure by one person adds to the property of another, but also where the expenditure saves the other from expense or loss. . . . Among the particular situations and instances in which the application of the foregoing doctrines and remedies has been considered may be mentioned . . . the construction of improvements on the land of another, . . . ”

The McEntires expended the $2,000.00 improving the property, not of their own volition but because they were required to do so in order to keep the property in workable condition. The testimony showed that the Cousart Drainage Ditch ran through the property, and the Cousart Drainage District had a dragline clean out its ditch and push the dirt back on the land here involved; and the McEntires were obliged to have a bulldozer spread this spoil bank over the land in order that it could be farmed. The $2,000.00 was expended in spreading out the spoil bank over the land and opening up the laterals and ditches so that the land could be farmed. The McEntires didn’t deliberately undertake these improvements. They were merely trying to save the usable character of the farm, and if this $2,000.00 item doesn’t come within the “betterment” decisions cited by the Majority, it certainly comes within the rule of “unjust enrichment”. I think the Chancellor was correct in allowing the McEntires the $2,000.00.

II. Interest on the $3,100.00. I think the Trial Court was correct in allowing the McEntires interest on the $3,100.00. It is true that prior to the first trial the Vernons tendered $3,100.00 to the MeEntires, hut there is no evidence in the record, in either the first trial or this one, that the Vernons kept such tender alive. To offer the money is a tender; but the law requires that the tender be kept alive in order to stop the running of interest; I cannot find any evidence in the record in either trial that the Vernons ever kept the tender alive. In Abbott v. Herron, 90 Ark. 206, 118 S. W. 708, Judge Battle said, with regard to keeping tender alive:

“It is true that he tendered to plaintiff fifteen dollars, which was refused. But this is not sufficient. ‘After a tender is duly made, it must, to preserve its legal effect, be kept good.’ Kelly v. Keith, 85 Ark. 30, 32. The defendant denied that he was indebted to plaintiff, but said he had tendered to him fifteen dollars. He made no offer to keep it good by paying it into the registry of the court or otherwise. He was content with having-made it at two different times. He did not renew it in his answer.”

Since the Vernons did not keep the tender alive by paying it into the Registry of the Court or otherwise, then the MeEntires were entitled to interest as fixed by the Chancery Court.


author: Sam Robinson, Associate Justice.

text:
    Crawford v. Vinyard.
    5-2659
    356 S. W. 2d 8
    Opinion delivered April 9, 1962.

      J. B. Milham and Gladys M. Cummins, for appellant.
    Hall, Purcell Bosioell, for appellee.
   Sam Robinson, Associate Justice.

Appellant, Martha Gertrude Crawford, filed this suit to foreclose a vendor’s lien. Foreclosure was denied on the ground that a mutual mistake had been made in preparing the instruments sued on. Reformation was ordered and the grantor has appealed.

On the 11th day of August, 1960, appellant sold the property involved to James Vinyard and his wife, Jimmie, for the consideration of $3,500.00. Six hundred dollars was paid in cash and a note was executed by the purchasers for the balance of $2,900.00, payable in monthly installments of $35.00 each, with interest from date until due at the rate of six per cent per annum and thereafter at the rate of ten per cent per annum until paid. A vendor’s lien was retained to secure the payment of the purchase money. At the end of the first month after execution of the note the purchasers paid to appellant $35.00 and made 11 consecutive monthly payments of $35.00 each.

On July 15, 1961, the Vinyards sold the property to appellees, Neilan Huchingson and his wife Delores, subject to the vendor’s lien. The Hutchingsons attempted to continue to make the monthly payments by sending to appellant a check in the sum of $35.00 each month. Appellant was unhappy with the Vinyards having sold the property and filed this action alleging that the purchasers had not paid the interest on the monthly payments. Appellees answered alleging that at the time the property was purchased it was agreed that the $35.00 monthly payments would include interest; that the note and deed prepared by the grantor’s attorney failed to express the true agreement of the parties and should be reformed accordingly. After considering all the evidence, the Chancellor held in favor of reformation.

The evidence is clear and convincing that the parties agreed that the $35.00 monthly payments would include interest. In addition to the direct testimony of James Yinyard to that effect, and no denial by appellant in her testimony, all the circumstances point to that conclusion. Just four days after the execution of the note and deed, appellant’s attorney, who prepared the instruments, wrote to appellant as follows: “In regard to the balance owed you by Mr. Yinyard, you are advised that the table to which I referred shows that the time required to liquidate a debt of $2,900.00 at $35.00 per month with interest at 6% per annum is 107 months. In other words Mr. Yinyard will owe you 107 monthly payments of $35.00 each, in the event he lets this run the full time. ’ ’

A copy of the letter was sent to appellee, James Vinyard. The letter shows rather conclusively that the attorney’s understanding of the agreement was that the debt was payable in 107 monthly payments. Hence, the $35.00 monthly payments would include interest. If interest were payable monthly, in addition to the $35.00 payments, there would not be 107 payments. Moreover, for 11 months appellant accepted the $35.00 monthly payments without complaining or contending that interest in addition to the sum received was due. This is a strong circumstance that appellant’s understanding was that the $35.00 payments included the interest.

In Fuller v. Hawkins, 60 Ark. 304, 30 S. W. 34, the Court said: “The rule that a Court of Equity has the power to correct mistakes in deeds and mortgages, so as to make them conform to the intention of the parties in executing the same, is well settled.” To the same effect is Wood v. Wood, 207 Ark. 518, 181 S. W. 2d 481. In discussing reformation because of mutual mistake in 12 Am. Jur. 631 it is stated: “Relief is not precluded because of negligence if it is excused as where the mistake is mutual and both parties have been negligent. This is the rule where the parties have instructed the drafting of the writing to an attorney or scrivener and it does not express what the parties intended it to express.”

The decree erroneously provides that the agreement of the parties was that the note shall bear interest at six per cent per annum until paid. Appellees admit that this is error. The note provides that the interest shall be six per cent per annum until due and ten per cent thereafter until paid. To the extent indicated the decree is modified, and as modified it is affirmed.


author: Jim Johnson, Associate Justice.

text:
    Wiley v. State.
    5033
    356 S. W. 2d 240
    Opinion delivered April 9, 1962.
    [Rehearing denied May 7, 1962.]

      E. V. Trimble and L. H. Mahon, for appellant.

      Frank Holt, Attorney General, by Jack L. Lessen-berry, Asst. Attorney General for appellee.
   Jim Johnson, Associate Justice.

Appellant prosecutes this appeal from a conviction of grand larceny. She raises two points on appeal:

(1) The court erred in failing to direct a verdict in her favor.

(2) A mistrial should have been granted because of her interrogation as to previous arrests.

Without engaging in an extended discussion of the evidence, we are of the opinion that there was sufficient evidence to warrant submission of the issue of appellant’s guilt or innocence. Suffice it to say that there was testimony to the effect that defendant was in the company of two thieves who were shoplifting at the time and that one of the thieves put some stolen merchandise into a box which was being supported on the knees of the defendant. This testimony was sufficient to make a jury question as to whether the defendant was knowingly aiding and abetting the two thieves.

Appellant’s second point must be rejected because she did not request a mistrial in the two instances wherein she was interrogated as to previous arrests. Her counsel merely objected to the questions, the objections were sustained and the court admonished the jury not to consider such questions. It is fundamental that an appellant cannot complain of such an alleged error unless (1) he makes some request of the court; (2) the court refuses the request; (3) appellant saves his exceptions to the court’s ruling; and (4) preserves the point in a motion for a new trial. Freyaldenhoven v. State, 217 Ark. 484, 231 S. W. 2d 121.

Affirmed.


author: Neill Bohlinger, Associate Justice.

text:
    Boston Ins. Co. v. Farmer.
    5-2665
    356 S. W. 2d 434
    Opinion delivered April 9, 1962.
    [Rehearing denied May 14, 1962.]

      Phillip H. Loh, for appellant.

      Johnston & Rowell, for appellee.
   Neill Bohlinger, Associate Justice.

The appellees brought this suit in the Conway County Circuit Court to recover the sum of $916.50 for the loss of poultry in a fire which destroyed their poultry house and which house and poultry were insured against fire hazard by a policy of insurance issued by the appellant.

The issuance of the policy and its being in effect at the time of the fire are not contested here and it appears that the appellees have agreed with the appellant on a settlement for the loss of the building.

The issue in regard to the'loss of the poultry was submitted to a jury under proper instructions and a verdict in favor of appellees in the sum of $916.50, plus interest and penalty, was returned by the jury and judgment in conformity with that finding, plus attorney’s fee, was duly entered by the court. The appellant does not take issue with the instructions given by the court and the sole point presented here is appellant’s contention that there is no substantial evidence to support the verdict which the appellant alleges is excessive.

It appears that the appellees purchased a number of hens in June, 1959, for which they paid $1.64 each. The testimony is that at the time of the fire they had 1,400 hens and that the chief value of the poultry was for laying purposes. Due to the age of the hens at the time of the fire it was testified that the hens had passed the peak of their egg producing capabilities and the appellee valued the hens at 75 cents each which, had all the hens been destroyed, would have made their loss $1,050.00. However, they salvaged 102 hens that sold for 75 cents each, reducing their loss by $76.50, and 303 hens were so badly damaged in the fire that they were able to realize only 5 cents a pound for them which netted $57.00. Deducting this salvage from the value of the hens left a loss of $916.50 as set out in the prayer for relief.

There is testimony that the market value of hens at the time of the fire ranged from 9 to 12 cents a pound for meat purposes hut there was also testimony that there was no market in Conway County for the type of chickens which the appellees had after the fire and the market price was whatever they could get for them. The appellees were confronted with the necessity of getting rid of 405 chickens, 303 of which were damaged in the fire, and with no place to house or care for them they seem to have sought the best market available, selling the undamaged hens at a price of 75 cents, and it is not shown that a higher sum was available anywhere. The damaged chickens were sold to a restaurant for eating purposes at 5 cents a pound.

The appellant does not question the competency of testimony for appellees but merely complains of the quality of it. A verdict will not be overturned if there is any substantial evidence to support it, Elkins v. Nelson, 196 Ark. 209, 118 S. W. 2d 287. See also Missouri Pacific Rd. Co. v. Fowler, 183 Ark. 86, 34 S. W. 2d 1071. Appellee, M. M. Farmer, testified as to the value of his property which he had a right to do. Any person, owner of personal property, may testify as to his opinion of its value. Phillips v. Graves, 219 Ark. 806, 245 S. W. 2d 394; Missouri Pacific v. Fowler, supra; Security Bank v. McEntire, 227 Ark. 667, 300 S. W. 2d 588. We said in Kesterson v. Hays, 137 Ark. 592, 209 S. W. 721:

“The question of market value being one entirely of opinion of the witness who undertakes to testify on the subject, does not require expertness on the subject, but it is after all a question for the jury to determine under the circumstances how much weight is to be attached to the testimony of the witness. St. Louis & San Francisco Rd. Co. v. Shore, 89 Ark. 418.”

The evidence presented in this case raised a question for the jury, to which it was properly submitted, and we find from the record sufficient evidence from which the jury could have and did find that the destroyed chickens were of a value of $916.50. That verdict we do not disturb.

There being no error, the cause is affirmed.


author: Carleton Harris, Chief Justice.

text:
    Reserve Vault Corp. v. Jones.
    5-2625
    356 S. W. 2d 225
    Opinion delivered April 16 1962.

      Wayne Foster, for appellant.

      Frank Holt, Attorney General, by Jack L. Lessen-berry, Asst. Attorney General, for appellee.
   Carleton Harris, Chief Justice.

This litigation involves the validity of Act 78 of 1961, entitled, “An Act Relating to Prepaid Funeral Expenses; Requiring Registration of Organizations Dealing Therein and Requir-ing the Establishment of Trusts for the Benefit and Protection of Purchasers of Such Contracts.” The provision particularly under attack is Section 5, which reads as follows:

“SECTION 5. After the effective date of this Act, all funds collected under contracts for prepaid funeral benefits, including funds collected under contracts made before the effective date of this Act, shall be placed in a state or national bank, or building and loan association in this State and so deposited not less than thirty days after collection, to be held in a trust fund in this State for the use, benefit and protection of purchasers of such contracts. Any withdrawals from such trust fund shall be accompanied by a certified copy of the death certificate, together with proper affidavits as may be required by the Securities Division of the State Bank Department, before such funds shall be released in fulfillment of the contract. In no event shall more funds be withdrawn from the trust account than are originally placed into the fund under any one contract, other than through the payment of accrued interest thereon.”

Appellant, Reserve Vault Corporation, is engaged in selling fiberglass grave vaults to the general public, under a procedure sometimes referred to as “px’e-need” contracts. Appellant Washington is one of the salesmen for the corporation. The company has been selling these vaults under two contracts, herein referred to as contract “A”, and contract “B”. Prior to the passage of Act 78, approximately one hundred such vaults had been sold at an average price of $195 each. Under an agreement between the corporation and its salesmen, Washington was to receive a commission of 25% of the selling price of each vault sold by him. Practically all of the contracts under which the vaults were sold provided that the selling price would be paid in moxithly payments, and the salesmen were to receive the first 25% of monies paid in. Washington, as salesman for appellant company, made the sale of a vault to Mrs. Leaether A. Bailey on November 10, 1960, for a total consideration of $190, of which. $5 .was paid in cash, and the balance was to be paid in thirty-seven equal monthly installments in the amount of $5 each. This sale was made under contract “A”, pertinent portions of which read as follows:

“The said vault(s) are sold subject to the following conditions which are hereby agreed to by the parties:
The company agrees to deliver the grave vault or vaults purchased under this contract to any place designated by the purchaser within the State of Arkansas. Purchaser or someone acting for purchaser hereby agrees to notify corporation immediately upon death whereby, the corporation will have a minimum of twenty-four hours notice prior to the delivery of the vault. Purchaser agrees to give a minimum of twenty-four hours notice that a vault is required and of the place and time of delivery. Corporation agrees to effectuate delivery within a twenty-four hour period after notice, however, the corporation shall not be liable for delays in delivery due to acts of God or conditions beyond the control of the corporation. Corporation agrees to maintain a separate account which shall be at least 50% of the amount of this contract. This reserve account shall be a restricted fund to assure performance by the corporation of its contract. Investments of this fund shall be made by the Board of Directors of the corporation.”

On March 18, 1961, the company sold a vault to William and Pauline Dailey for the sum of $200.85, of which $5 was paid in cash, and the balance was to be paid in thirty-nine equal monthly installments of $5 each. This sale was made under contract “B”, termed the “lay away plan”, and pertinent portions read as follows:

“The corportion agrees to deliver grave vault or vaults purchased under this contract to any place designated by the purchaser within the State of Arkansas within a period of ten days subsequent to corporation’s receipt of the final installment due under this contract, however, the corporation shall not be liable for delays in delivery due to Acts of God or conditions beyond the control of the corporation.”

Act 78, containing an emergency clause, became effective on February 13,1961, and on March 23, appellants instituted suit in the Pulaski Chancery Court, seeking a declaratory judgment relative to the validity of Act 78. It was alleged that appellants were about to be adversely affected by the provisions of the Act, and that same was in contravention of both the Constitution of the United States, and the Constitution of the State of Arkansas, As an alternative, appellants prayed that if the Act be held constitutional, the Court enter its judgment finding that Act 78 had no application to the contracts herein involved, as being outside the purview of the Act. On trial, the Court held that Act 78 was a constitutional exercise of the police power of the State of Arkansas to regulate a business susceptible to fraudulent practices. The Court further held:

“3. That said Act does not unconstitutionally impair the contracts of plaintiff corporation with the defendant, Leaether Bailey, or the contract for commissions between plaintiff corporation and its salesman, plaintiff A. J. Washington.
4. That the contract noted as Exhibit “A” is within the purview of said Act.
5. That the contract described as Exhibit ‘ ‘ B ” from the testimony and evidence given at the trial is not within the purview of said Act.
6. That said Act is retroactive to include contracts executed prior to its enactment, but it is not the intent of said Act to require the payment into a trust fund of any collection made on the Leaether Bailey contract prior to the effective date of the Act, but does require the payment into a trust fund of all payments collected on said contract since the effective date of the Act, even though said collections be funds previously relegated by contract to the salesman, A. J. Washington, as a commission. ’ ’

Judgment was entered accordingly, and appellants have appealed from that portion holding the Act constitutional, and finding that contract “A” is covered by the Act. The State has not appealed from that portion of the judgment finding that contract “B” is not within the purview of said Act. For reversal, appellants rely upon several points, which we proceed to discuss.

It is first asserted that the contract, here involved, is not controlled by the Act, and is beyond its scope and purview. In presenting this point, appellants first argue that the Act purports only to cover situations wherein delivery (of a vault) is dependent upon death, and, say appellants, the Bailey contract does not require the death of anyone as a condition precedent to delivery. We do not concur with this contention. We think this statement would be apt relative to contract “B”, which on its face, only requires full payment of the purchase price before delivery can be demanded, but it is evident from the language of contract “A”, that delivery is dependent upon a death. Again quoting the pertinent portion:

“Purchaser or someone acting for purchaser hereby agrees to notify corporation immediately upon death whereby, the corporation will have a minimum of twenty-four hours notice prior to the delivery of the vault. Purchaser agees to give a minimum of twenty-four hours notice that a vault is required and of the place and time of delivery.”

We do not agree with appellant that a purchaser under this contract would be entitled to obtain a vault as soon as same was paid for. Appellants likewise argue that Act 78 relates only to contracts which are dependent upon the death of a “contracting party”, and that the contract in question certainly does not require the death of the contracting party. This same contention was made, and rejected, in the case of Falkner v. Memorial Gardens Association, 298 S. W. 2d 934. There, the Court of Civil Appeals of Texas passed upon an Act identical with the Act here in question. Relative to this contention, the Court said:

“Some contracts are doubtless made for the benefit of a third person or persons and are not necessarily dependent on the death of the actual contracting party. However, it is clear that they are made in contemplation of the death of the party benefited.”

Of course, a purchaser might have in mind another member of his family when buying the vault, and it must be likewise considered that certainly, in numerous instances, the vault would be purchased for the benefit of the contracting party. Accordingly, if appellants’ view were correct, the same exact contract would be sometimes within the purview of the Act, and sometimes without the purview of the Act, depending upon whether the contracting party purchased the vault in contemplation of his own death, or in contemplation of the death of some member of his family. Such an interpretation would leave the matter in total confusion, and would open the door to evasive practices. Actually a purchaser probably would not know for whom the vault was being acquired, the answer to that question depending upon which member of the family first died. At any rate, we find no merit in the contention, and hold that delivery of a vault, under contract “A”, is conditioned upon a demand made pursuant to a death.

Appellants contend that the Act is an unwarranted and unlawful exercise of the police power, stating “the attempted regulation of the money received from the sale of personal property, merchandise or services, in the connection of the disposal of a dead human body is not a matter for the exercise of the police power.” It is contended that to require appellant company to place the full purchase price in trust has no relation to the public health, safety, morals, or general welfare, especially in the absence of facts that appellant company is conducting a fraudulent business or is guilty of immoral or improper business practice. Appellants assert that the purchasers are adequately protected because the corporation agrees, in the contract, to place a portion of the money paid in by each purchaser in a separate account to guarantee peiiormance, i.e., to guarantee delivery of the vault purchased. According to the president of the company, about one-half of the contracts sold provide for 50% of the money to be invested in this separate account, and about one-half provide for 15%. We do not agree with appellants’ contention. The enactment of statutes for the purpose of prevention of fraud is within the police power of the state. Stuart v. Elk Horn Bank & Trust Co., 123 Ark. 285, 185 S. W. 263. While it is true that there is no charge of fraud against the present ownership of the company, allegations, or proof of fraud, has no bearing on determining the constitutionality of the statute. As set out in 16 C. J. S., Constitutional Law, § 198, p. 968:

“In determining the constitutionality of a statute bearing on its face clear indication that it was designed to prevent fraud, the court may not give weight to the fact that fraud was neither charged or proved. ’ ’

We think unquestionably the Legislature, in passing the Act, had in mind the protection of the public; in fact, this is shown by the language appearing in the Emergency Clause. During the taking of the testimony of the president of Reserve Vault Corporation, it was developed that all shares of stock could, at any time, be sold to some presently unknown individual, who would have complete control of the company; it was further shown that the president has the right to withdraw all company funds simply by writing a check. Let it be borne in mind that many of these contracts will not mature for a long number of years, and vast changes in the status of the corporation and its personnel can well take place. In fact, the witness admitted that even a $1,000 claim against the company at .present could not be met with company funds, since the corporation had only $700 in the bank. In the case of Memorial Gardens Association, Inc. v. Smith, 16 Ill. 2d 116, 156 N. E. 2d 587, the Supreme Court of Illinois said:

“Plaintiffs urge that the act constitutes an unwarranted exercise of the police power; and that it is confiscatory of plaintiffs’ business and thereby violates the due process provisions of the State and Federal constitutions. We will first consider this contention. The police power is an attribute of sovereignty inherent in every government. It has been reserved to all the States by the constitution of the United States, (citing cases) While it is not without limitation and may not be exercised arbitrarily, the legislatures of the States have broad discretion in the passage of statutes in its exercise, (citing cases) When the legislature has considered a problem and enacted legislation thereon, the act is presumptively a valid exercise of the power and the burden rests upon the one assailing the statute to show that it is without reasonable basis and entirely arbitrary, (citing cases) The enactment of statutes having for their object the prevention of fraud, deceit, cheating, and imposition is within the police power of a State, (citing cases)
There can be no doubt that the act relates to a proper subject for the exercise of the police power. The public has a vital interest in the proper disposition of the bodies of its deceased members. * * * There is nothing unique in requiring one who contracts for performance in futuro to give security for that performance. Thus, legislation requires contractors in public construction to give performance bonds, and compels insurance companies to maintain certain reserves and deposit security with administrative authorities charged with the supervision of their activities. The use of such bonds is generally accepted, and it is well settled that the insurance business is affected with a public interest and subject to control by the State in the exercise of its police power, (citing cases)
The contracts here involved are analogous to a form of insurance. By payments made during life, the purchasers seek to insure their burial. The net effect is the same as though a life insurance contract were purchased to provide a sufficient sum payable at death to accomplish that result. In the case of insurance, the right of the legislature to require reserves and the deposit of security is unquestioned. The trust fund provisions of the act in question are designed to accomplish the same purpose, that is, to assure the purchasers that the company will be able to complete their contracts when the time for performance arrives. When we consider that contract payments are to be made in a maximum of three years and that the average time until performance of the ‘pre-need’ contracts is almost 29 years, the justice of the legislation becomes evident. Plaintiffs, themselves, have recognized the need of some protection for the purchaser by including in their form of contract certain vague provisions relative to setting aside a trust fund. These illusory provisions furnish purchaser appeal, but fail to provide the protection which the situation warrants. ’ ’

Appellants complain that the Act is confiscatory, rather than regulatory, and actually has the effect of prohibiting the corporation from operating. Appellant corporation states that it cannot operate if it is required to place all monies collected in a trust fund; that this requirement precludes it from using any funds for operational expenses of the business, and likewise prohibits it from paying its salesmen the 25% commission on each sale until some time in the future. Appellant company states that each salesman will have to outlive the purchaser in order to collect his 25% commission. As was pointed out by the Court in the Memorial Gardens case, “It would be most unusual to expect, or require, prospective purchasers to furnish or advance capital funds necessary for the operation of a business.” The argument that the statute is confiscatory, rather than regulatory, was met by that Court as follows:

“Plaintiffs urge, however, that the act is prohibitory rather than regulatory; that, if refused the right to make the unauthorized deductions from the trust fund, they will be unable to remain in business. They state that the immediate expenses, including commissions and general overhead items, make it impossible to deposit in trust the large amounts required by the act: * * * In the long interval between full receipt of the purchase price and contract performance, the opportunities for fraud are great and risk of insolvency, with consequent inability to perform, apparent. The suggestion that actual costs are a minor item and that the legislature should have required a smaller deposit is unimpressive under the circumstances. The main thrust of plaintiffs’ argument is that the regulations of the act will prevent the operation of its business of ‘pre-need’ sales and that they will be compelled to cease business if forced to make sales only at the time of death. However, the act neither restricts plaintiffs’ sales of such property at the time of death, nor prohibits ‘pre-need’ sales. * * *
We do not believe that the present statute operates to prohibit plaintiffs’ legitimate business. It does regulate the manner in which the business may be conducted. Practically, plaintiffs will no longer be able to collect prospective profits in advance, without furnishing an adequate guarantee for performance. However, this does not prohibit the operation of this type of business. A large discretion is necessarily vested in the legislature to determine not only what the interests of the public welfare require, but what measures are necessary to secure such interests, (citing cases) Plaintiffs’ argument amounts to an admission that they will be unable to compete with others who sell the same merchandise and services at the time of actual need. However, the public welfare need not be abrogated to enable an individual to carry on his business in the particular manner in which he has elected to proceed. The analogy which plaintiffs seek to draw between their contracts and retail sales made on the ‘lay away’ plan is fallacious. The ‘lay away’ sale contemplates performance within a relatively short period of time upon payment of the purchase price. Opportunities for fraud are negligible and remedies for nonperformance are readily available.”

Likewise, the Court of Civil Appeals of Texas, in Falkner v. Memorial Gardens Association, supra, was presented with the same argument. Quoting from that Court’s opinion:

Appellees say:

‘The Act is fundamentally unconstitutional because it is confiscatory. It is not intended to be regulatory or give reasonable protection to that part of the public doing business with appellees. It is intended to put appellees out of business because by Section 5 it requires all of the funds paid under the agreement to be placed in a trust fund until delivery without any recognition for the current expenses of salesmen’s commissions, office expenses in keeping records and making collections of installment payments, or developing and maintaining the memorial cemeteries in which the merchandise is placed. ’

This complaint is largely a criticism of the Act. In Glens Falls Ins. Co. v. Hawkins, 103 Tex. 327, 126 S. W. 114, 115, Judge Brown said:

The policy of enacting the law, whether good or bad, was a question for the Legislature, and the courts cannot consider it.’

* * * The fact that the Act requires all funds collected under the contracts to be deposited in a trust fund is a mode of regulation of the business and does not prohibit its conduct. The fact that the Legislature saw fit to impose on the business a regulation that to appellees may seem onerous will not render the Act unconstitutional because the Legislature acting in the public interest was authorized to impose regulations on the business that operates uniformly on all persons engaged in such business.”

Appellant company, in stating that the Act will prohibit it from doing business, apparently overlooks the fact that it is still permitted to enter into contracts under its “lay away” plan; in fact, the president of Reserve Vault stated that he could operate his business under this last type of contract. At any rate, we find that the Act is regulatory, rather than prohibitory.

Appellants next argue that even if regulation is proper, the present act goes beyond any actual necessity. This argument is closely related and interwoven to that just discussed, and the cases there cited dispose likewise of this contention. It might be added that this Act is, to some extent, more liberal than acts of some of our sister states, in that it permits the company to withdraw the accrued interest. Furthermore, the Commissioner of the Securities Division of the State Bank Department is given some discretion in enforcement provisions, and his testimony before the court indicates a fair and reasonable interpretation of his duties.

Finally, appellants complain that the Act impairs the contract between appellant company and its salesman for any commission earned prior to the passage of the Act. This argument is based on the provisions of the federal and state constitutions which prohibit the impairing of contracts. United States Constitution, Article I, Section 10, Arkansas Constitution, Article II, Section 17. The great weight of authority is contrary to appellants’ contention, it being recognized that these prohibitions do not prevent a proper exercise by the state of its police power. See 16 C. J. S., § 281, p. 1284. In Home Building & Loan Assn. v. Blaisdell, 290 U. S. 398, Chief Justice Charles Evans Hughes stated the reasoning with unusual clarity:

“Not only are existing laws read into contracts in order to fix obligations as between the parties, but the reservation of essential attributes of sovereign power is also read into contracts as a postulate of tbe legal order. Tbe policy of protecting contracts against impairment presupposes the maintenance of the Government by virtue of which contractual relations are worthwhile — a government which retains adequate authority to secure the peace and good order of society. This principle of harmonizing the constitutional prohibition with the necessary residuum of state power has had progressive recognition in the decisions of this Court.”

Further in the Opinion, quoting from an earlier case:

“It is the settled law of this court that the interdiction of statutes impairing the obligation of contracts does not prevent the State from exercising such powers as are vested in it for the promotion of the common weal, or are necessary for the general good of the public, though contracts previously entered into between individuals may thereby be affected. This power, which in its various ramifications is known as the police power, is an exercise off the sovereign right of the Government to protect the lives, health, morals, comfort and general welfare of the people, and is paramount to any rights under contracts between individuals. ’ ’

In Memorial Gardens Association, Inc., v. Smith, supra, the Illinois court commented on this particular question as follows:

“Plaintiffs contend that the act constitutes an unwarranted interference with the right of citizens to contract with each other and thus violates constitutional guarantees of both the State and Federal constitutions. While rights of contract are favored and protected there is no principle of absolute freedom of contract. It is a qualified right and the State may, in its legitimate exercise of the police power, pass laws which limit or affect the right of contract so long as those regulations are reasonably necessary to secure the health, safety, morals or general welfare of the community, (citing cases) The constitutional guarantee does not withdraw from legislative supervision that department of human activity which, consists in the making of contracts, or deny to government the power to provide restrictive safeguards. Liberty implies only the absence of arbitrary restraint, not immunity from reasonable regulations and prohibitions imposed on the interests of the community, (citing-cases) In the exercise of the police power it becomes necessary to prohibit some forms of contract entirely and to restrict others, yet the right to do so is unquestioned when the. public welfare demands it-. ’'

In Reiman v. Rawls, 188 Ark. 983, 68 S. W. 2d 470, this Court, quoting from the Blaisdell case, said:

“But into all contracts, whether made between States and individuals, or between individuals only, there enter conditions which arise not out of the literal terms of the contract itself; they are superinduced by the pre-existing and higher authority of the laws of nature, of nations or of the community to which the parties belong; they are always presumed, and must be presumed, to be known and recognized by all, are binding upon all, and need never, therefore, be carried into express stipulation, for this could add nothing to their force. Every contract is made in subordination to them, and must yield to their control, as conditions inherent and paramount, whenever a necessity for their execution shall occur.”

Affirmed.

Robinson, J., not participating.

       The sale of grave vaults is covered under Section One of the Act.

       See Section One of the Act.

       This is a family corporation, all stock being owned by members of the family. The corporation was created with the minimum of $300 paid in capital.

       The decree of the Chancery Court, after finding that contract “B” was not within the purview of the Act, further provided: “If at any time the contract marked Exhibit “B” or a similar contract is used as a subterfuge to evade Act 78 of 1961, this judgment is not res adjudicata and shall not prevent the State of Arkansas from instituting appropriate legal action to insure compliance with the provisions of said Act.”

       Numerous states, including (but not limited to) Arizona, Idaho, Kansas, Maine, Montana, New York, North Dakota, South Dakota, Texas, Utah, Virginia, and Wisconsin, require all funds to be deposited and held in trust. Many of these states include the interest accruals. Other states require that the greater percentage of the funds be placed in trust; for instance, Georgia, 85%; Iowa, 80%; and Florida, 75%. Illinois requires that 95 % of the principal be so deposited, and further provides that only 5% of the interest may be used.


author: Ed. F. McFaddin, Associate Justice.

text:
    Connelly v. Thomas. Thomas v. Connelly.
    5-2638; 5-2642
    356 S. W. 2d 430
    Opinion delivered April 16, 1962.
    [Rehearing denied May 14, 1962.]

      5-2638. J. Hugh Wharton, for appellants; B. W. Thomas and Richard W. Hobbs, for appellees.
    5-2642. B. W. Thomas and Richard W. Hobbs, for appellants; J. Hugh Wharton, for appellees.
   Ed. F. McFaddin, Associate Justice.

These two cases stem from the criminal cases of the State of Arkansas v. Bonnie Connelly, which have been twice before the Court. Connelly v. State, 232 Ark. 826, 335 S. W. 2d 723; Connelly v. State, 234 Ark. 143, 350 S. W. 2d 298. In the first case we reversed the second degree murder conviction of Mrs. Connelly; and in the second case we affirmed Mrs. Connelly’s conviction for manslaughter. When Mrs. Connelly was originally charged with the murder of her husband she employed Messrs. Thomas and Hobbs to represent her; but she became dissatisfied when they insited on sending her to the State Hospital for mental examination, so she discharged them. The said attorneys filed action in the Garland Circuit Court and obtained a verdict and judgment on December 2, 1959 against Mrs. Connelly for $3,559.90 as a reasonable attorneys’ fee; and, by execution, obtained $1,325.50 credit on the judgment.

Then Messrs. Thomas and Hobbs filed this suit, No. 33241 in the Garland Chancery Court, (a) to recover additional fees claimed to be due; (b) to cancel as a fraudulent conveyance an assignment executed by Mrs. Connelly to her mother, Mrs. Alice Nichols, for $11,000.00 of the proceeds of a life insurance policy; and (c) to subject the proceeds of the life insurance funds to the satisfaction of the plaintiffs’ judgment. The New York Life Insurance Company was made a defendant as equitable garnishee in order to impound the proceeds of the said life insurance policy. The Insurance Company paid $19,971.30 as the proceeds of the policy into the Registry of the Court, was discharged with its costs (§ 27-816 Ark. Stats.), and had no further part in this litigation.

The defendants, Mrs. Connelly, her daughter, and her mother (altogether referred to as “Mrs. Connelly et al.”), resisted the complaint, and trial in the Chancery Court resulted in a decree from which both sides have appealed. Mrs. Connelly et al. were dissatisfied because (a) Thomas and Hobbs received any judgment, (b) the assignment to Alice Nichols was not recognized as valid, and (c) the Court held certain assets to await the outcome of this appeal; so they filed their appeal as Case No. 2638 in this Court. Messrs. Thomas and Hobbs were dissatisfied because the amount of the Chancery judgment which they received was not as large as they claimed; so they filed their appeal as Case No. 2642 in this Court. These two pending cases are consolidated because both are from the same decree of the Garland Chancery Court.

I. The Claim Of Messrs. Thomas And Hobbs. Messrs. Thomas and Hobbs claimed that in addition to representing Mrs. Connelly in the criminal proceedings, they had also, at her request and at the request of her daughter, obtained court orders declaring the said Bonnie J. N. Connelly of full age; had resisted guardianship proceedings against Bonnie J. N. Connelly in the Garland Chancery Court; and had also spent considerable time, energy, and effort as attorneys for Mrs. Connelly in briefing the question as to whether she could recover the proceeds of the insurance policy here involved. For all of these services, the attorneys claimed that they should receive a fee of at least $1,500.00, in addition to the Circuit Court judgment which they had already obtained from Mrs. Connelly.

After hearing all of the evidence, the Chancery Court awarded Messrs. Thomas and Hobbs a fee of $200.00 for their services, in addition to the Circuit Court judgment. From the evidence before us, we are unable to say that the Chancery Court was in error in fixing this amount. The Circuit Court judgment in favor of Messrs. Thomas and Hobbs and against Mrs. Connelly was rendered on December 2, 1959 for $3,559.90. The Chancery Court in the case at bar may well have concluded that Messrs. Thomas and Hobbs included in the Circuit Court case their entire account for all services rendered to Mrs. Connelly to the date of the said Circuit Court judgment; and most of the services testified to by Messrs. Thomas and Hobbs, as rendered to Mrs. Connelly in addition to the representation in the criminal case, were services that were rendered before the date of the said judgment. Having the minor declared of age was on July 8, 1959. Resisting the effort of other relatives to have the minor placed under guardianship was on July 21, 1959. In fact, we find very few services to have been rendered by Messrs. Thomas and Hobbs to Mrs. Connelly or Bonnie J. N. Connelly after the date of the Circuit Court judgment of December 2, 1959. Therefore, as to the $200.00 awarded Messrs. Thomas and Hobbs, we are unable to say that the Chancery Court was in error in any respect, either on the appeal of Mrs. Connelly, et al., or on the appeal of Messrs. Thomas and Hobbs.

II. The Assignment Of The Insurance Proceeds. Mrs. Connelly et al. complain because the Chancery Court cancelled as fraudulent an assignment which Mrs. Connelly had made to her mother, Mrs. Alice Nichols. Messrs. Thomas and TIobbs filed their Circuit Court action against Mrs. Connelly on August 17, 1959. Having employed other attorneys, Mrs. Connelly, on September 12, 1959, executed assignments to them totaling in excess of $9,000.00 against the proceeds of the insurance policy. Then on November 2, 1959, Mrs. Connelly executed to her mother, Mrs. Alice Nichols, as Trustee, an assignment for $11,000.00 of the proceeds of the insurance policy. It is this $11,000.00 assignment that the Chancery Court set aside. It was clearly a fraudulent conveyance, and the Chancery Court was correct in cancelling it.

Mrs. Connelly testified that she had no money at the time; that her brothers and sisters loaned her money; and that the assignment to Mrs. Nichols, Trustee, was to repay such advances. Yet, the fact remains that no brother or sister came forward to testify as having made any advances to Mrs. Connelly. Only the mother, Mrs. Alice Nichols, testified, and her testimony was indefinite and uncertain. We thus have a debtor (Mrs. Connelly) in financially desperate circumstances equal to insolvency, making a conveyance (the assignment) to her near relative of all of her tangible assets and with no proved consideration therefor. In Kaufman v. Citizens’ Bank, 189 Ark. 113, 70 S. W. 2d 572, we said:

‘ ‘ The rule of law, in reference to conveyances under the facts and circumstances here presented is well settled in this State, and is to the following effect: ‘Conveyances made to members of one’s household and to near relatives of an embarrassed debtor are looked upon with suspicion and scrutinized with care; when voluntary they are presumed fraudulent, and when the embarrassment of the debtor proceeds to financial wreck such conveyances are conclusively presumed to be fraudulent as to existing creditors.’ Wilkes v. Vaughan, 73 Ark. 174, 83 S. W. 913; Papan v. Nahay, 106 Ark. 230, 152 S. W. 107; Brady v. Irby, 101 Ark. 573, 142 S. W. 1124; Fluke v. Sharon, 118 Ark. 229, 176 S. W. 684.”

III. Holding Assets For Future Distribution. Mrs. Connelly et at. complain that the Chancery Conrt had no authority to retain $1,500.00 of the insurance money in the Registry of the Court to await the outcome of this litigation. From the $19,971.30 paid into the Garland Chancery Court by the New York Life Insurance Company, the decree here challenged made the following disbursements:

(a) To Mr. Holt for attorney’s fees $ 4,459.14
(b) To Mr. Lookadoo for attorney’s fees . 5,309.14
(c) To Mr. House for filing the inter-pleader for the Insurance Company 300.00
(d) To Mr. Francis to satisfy a judgment he held against Mrs. Connelly 1,187.38
(e) To Messrs. Thomas and Hobbs to satisfy their Circuit Court judgment against Mrs. Connelly 2,672.41
(f) To Messrs. Thomas and Hobbs for the Probate and Chancery fee allowed in this case 200.00
Total Paid Out $14,128.07
(g) Retained in Registry of Court 1,500.00
(h) Paid to Mrs. Bonnie Connelly at the time of the decree 4,343.23
Total to Equal Amount Deposited $19,971.30

The disbursements, (a) to Mr. Holt, and (b) to Mr. Lookadoo, Avere for services rendered to Mrs. Connelly in her criminal cases, and she raises no question about these disbursements. Neither is any question raised on this appeal as to the correctness' of the disbursements (c), (d), and (e) above. We have already considered and settled the question as to the correctness of the disbursement (f) which was to Messrs. Thomas and Hobbs for their services in the Probate and Chancery Court. The appellants, Mrs. Bonnie Connelly et al., complain on this appeal that the Chancery Court should not have retained in its Registry the $1,500.00 in item (g), but should have delivered said amount to Mrs. Connelly, along with the $4,343.23 in item (h).

We fail to see wherein Mrs. Bonnie Connelly et al. have any merit in such contention. The money in the Registry of the Court had been interpleaded by the New York Life Insurance Company and the burden was on each claimant to establish such claimant’s right to any part of the interpleaded money. Each person seeking any part of the money had the position of a plaintiff toward such money. In Consolidated Underwriters v. Bradshaw, 136 F. Supp. 395, Judge John E. Miller said:

“. . . an interpleader action normally proceeds in two phases. The first phase is the granting of the interpleader and the dishcarging of the plaintiff from further liability upon payment of the particular fund into the registry of the court. The second phase of an inter-pleader action is the determination of the claimants’ rights to the fund. In regard to the second phase, each claimant occupies the position of a plaintiff and must establish his claim by a preponderance of the evidence. See Phoenix Mut. Life Ins. Co. of Hartford, Conn. v. Reich, D. C. Pa., 75 F. Supp. 886.”

Mrs. Bonnie Connelly, for herself, did not establish a claim to any of the money. Rather, she claimed that she had assigned the money to Mrs. Alice Nichols. So certainly Mrs. Connelly is in no position to complain. Mrs. Alice Nichols’ assignment was held to be fraudulent and void; so she would not be entitled to the $1,500.00 unless her assignment is held to be valid; and it was not valid. What the Chancery Court did was to leave the $1,500.00 in the Registry of the Court to await the result of this appeal. Since no party sought to supersede such decree, no .one could receive the fund until the further orders of the Court; and we find no abuse of discretion by the Trial Court.

The decree of the Chancery Court is affirmed in all respects, and the costs of this appeal are to be paid from the impounded fund.

       Mr. Joseph E. Connelly, the husband of Mrs. Connelly, had an insurance policy with New York Life Insurance Company, and his wife was named therein as the first beneficiary. No question is raised on this appeal as to Mrs. Connelly’s right to receive the proceeds of the insurance policy on her husband’s life; but in this connection attention is called to the cases of Smith v. Dean, 226 Ark. 438, 290 S.W. 2d 439; and Horn v. Cole, 203 Ark. 361, 156 S.W. 2d 787.

       Section 27-2127.10 Ark. Stats., which is § 18 of Act No. 555 of 1953, is authority for such consolidation.


author: George Rose Smith, J.

text:
    Ramsey v. American Automobile Ins. Co.
    5-2660
    356 S. W. 2d 236
    Opinion delivered April 16, 1962.

      Alonso D. Gamp, for appellant.

      Wright, Lindsey, Jennings, Lester $ Shults, for appellee.
   George Rose Smith, J.

This is a suit by Lee Ramsey to recover damages for a broken hip that he sustained in an accident at a Salvation Army warehouse in Little Rock. As a charity the Salvation Army is not subject to an action in tort, but it carried liability insurance with the appellee. This is a direct action against the insurer, pursuant to Ark. Stats. 1947, § 66-3240. The trial court directed a verdict for the defendant, on the ground that the proof did not show any negligence on the part of the Salvation Army.

At the warehouse wastepaper is collected and compressed into large bales weighing more than 1,200 pounds each. For several years before the plaintiff was injured in 1958 a mechanical hoisting device had been used to lift the bales and stack them on edge, two bales high, along the west wall inside the building. When the bales were sold the power hoist was used to put them into the delivery truck.

On the day of the accident an order for several bales was received from a salvage dealer. The hoist had broken down the week before and had not been repaired. The Salvation Army foreman directed Martin, the truck driver, to use as many men as he needed to load the bales by hand.

The heavy bales were manageable when standing on edge but not when lying flat. Martin climbed up on the double stack with the intention of pushing off the needed bales, one by one, from the upper tier. It was expected that each bale would land on edge and stay in that position for at least a moment or so. The plaintiff stood by to the south with a cart that he meant to shove against each bale to steady it before it tipped over and fell flat. It was thought that the bales would fall eastward when they were pushed off, but the first one unexpectedly fell or bounced to the south, striking the cart held by Ramsey and causing the injury sued for.

Ramsey had been receiving his room and board and a few dollars a week from the Salvation Army. In his complaint he first alleged that he was an employee of the charity. The insurer pleaded a clause in its policy exeluding employees from coverage for injuries sustained in the course of their employment. The complaint was then amended to withdraw any assertion that Ramsey was a Salvation Army employee.

In this court Ramsey contends that the statute allowing a direct action against the insurer of a charity does not permit the parties to exclude employees from the coverage of the policy. It is accordingly argued that the exemption clause in this policy is void. From this-premise the appellant goes on to contend that the jury might have found that Ramsey was an employee and that the failure to use the mechanical hoist on the day of the accident was a violation of the employer’s duty to-furnish a reasonably safe place to work.

We do not find in the statute any prohibition of the exclusionary clause. The act provides that when liability insurance is carried by a nonprofit organization “and any person . . . suffers injury ... on account of the negligence or wrongful conduct of any such organization . . . then such person . . . shall have a direct cause of action against the insurer with which such liability insurance is carried to the extent of the amount or amounts provided for in the insurance policy as would ordinarily be paid under the terms of the policy, and such insurer shall be directly liable to such injured person ... to the extent of such coverage in such liability insurance policy, and the plaintiff or plaintiffs may proceed directly against the insurer regardless of the fact that the actual tort-feasor may not be sued under the laws of the state.” Ark. Stats., § 66-3240.

The appellant argues, in effect, that the statutory reference to “any person” who suffers an injury should be construed to comprehend every person in the world, without exception, so that the parties’ attempt to exclude employees from the protection of the policy is contrary to the statute. We cannot discern in the language of the act a legislative intention to require such a broad- •and inflexible coverage as the appellant seeks. The evident purposes of the statute are to encourage charities to carry liability insurance and to prevent the insurer from defending on the ground that a judgment has not first been obtained against the insured. But the act is not compulsory; a charitable organization is free to carry insurance or not, as it chooses. Hence the appellant is a gratuitous beneficiary of the policy and must accept its exclusions along with its beneficial coverage. Indeed, that is the manifest intent of the statute, for it provides that the injured person shall have a cause of action ‘ ‘ to the extent of the amount or amounts provided for in the insurance policy” and that the insurer shall be directly liable ‘ ‘ to the extent of such coverage in such liability insurance policy. ’ ’

If the appellant was an employee the trial court was right in directing a verdict, because the policy did not protect employees. If, on the other hand, the appellant was not an employee the court’s action was also correct, for no breach of any duty owed to Ramsey has been shown. Ramsey, if not an employee, was at most an invitee. “The occupier of land is not an insurer of the safety of invitees, and his duty is only to exercise reasonable care for their protection. . . . Likewise, in the usual case, there is no obligation to protect the invitee against dangers which are known to him, or which are so apparent that he may reasonably be expected to discover them and be fully able to look out for himself.” Prosser on Torts (2d Ed.), § 78.

The only charge of negligence argued by the appellant is that the loading operation should not have been undertaken until the power hoist had been repaired. The attempt to load the bales by hand might have strained the employees participating in the effort, but it was not inherently dangerous to bystanders. Consequently it cannot be said that the Salvation Army owed to its invitees any duty to perform the work by mechanical means. In fact, that procedure would not have insured Ramsey’s safety, since a bale might still have been dropped or dislodged, with the possibility of injury to him.

Affirmed.


author: Paul Ward, Associate Justice.

text:
    South Ark. Feed Mills, Inc. v. Roberts.
    5-2635
    356 S. W. 2d 645
    Opinion delivered April 16, 1962.
    [Rehearing denied May 21, 1962.]

      Shackleford & Shackleford, for appellant.

      Gannaioay S Gannaway and Wright, Lindsey, Jennings, Lester é Shults, for appellee.
   Paul Ward, Associate Justice.

This appeal challenges the judgment of the circuit court which affirmed the Workmen’s Compensation Commission. It is not disputed that the claimant, Edwin Roberts, was injured or that he is entitled to compensation payments. The only question for decision is: Who was Roberts’ employer at the time of his injury — i.e. who is responsible for payment of benefits?

Factual Background. It is appellants’ contention that one of two other companies was Roberts’ employer,, so it is pertinent to identify the three companies concerned and the relationship of each to the employment of Roberts.

South Arkansas Feed Mills, Inc. (hereafter referred to as “South-Ark.”) was incorporated March 18, 1959. Keith Smith was elected its Secretary and General Manager. Among the share-holders and directors were Keith Smith and Bob McClure. Keith Smith Company will hereafter be referred to as the ‘ ‘ Smith Co. ’ ’ Its president was Keith Smith. The Bob McClure Produce Company will hereafter be referred to as the “Produce Co.” Its owner and manager was Bob McClure who was also director in South-Ark. The claimant, Edwin Roberts, was a regular full time employee of this company subject only to the circumstances later set out.

On April 16, 1959 South-Ark., by its Board of Directors, authorized Keith Smith to have a feed mill constructed for that company. Pursuant thereto, on May 5, 1959, South-Ark. also entered into a contract with the Smith Co. to secure the services of one Loyd Chapmond (an employee of the Smith Co.) for one year, agreeing in effect to pay for his services. Chapmond, who was an engineer, was to supervise the construction of the said feed mill. It appears that actual construction of the mill was begun promptly, with Roberts as one of the employees on that job.

It is pertinent to explain the status of Roberts. He had been a regular employee of the Produce Co., as a mechanic, since November 5, 1955, but on April 19, 1959 it was arranged for him to work part time on the construction of the new feed mill. The arrangements were that Roberts would receive $70 per week to be paid by checks issued by the Produce Co. with the Produce Co. being partially reimbursed by South-Ark. to the extent of $20 to $50 per week. By agreement Roberts worked part time for the Produce Co. and part time on the mill job. Apparently the Produce Co. paid Roberts for the time he worked for it and South-Ark. paid him for the time he worked on the mill job.

Roberts (claimant) was injured on March 10, 1960 while working on the mill job under the circumstances heretofore set forth. In the presentation of Roberts’ claim for compensation the only controversial issue was which of the three companies above mentioned should be responsible for making the payments. As before stated, the circuit court affirmed the Commission, both holding that South-Ark. was the responsible company. South-Ark. now prosecutes this appeal to reverse the judgment of the circuit court.

The Findings and Conclusions of the Commission will be clarifying and helpful. Findings: The relationship of employer and employee existed between South-Ark. and claimant when he was injured and had so existed for about eleven months theretofore. Conclusions: 1. The most reasonable interpretation of the evidence is that claimant was a special employee of South-Ark. at the time of his injury; 2. Shortly after claimant began work for South-Ark. he agreed to such employment, and he was paid by that company for his work; 3. South-Ark. exercised control over claimant while he was working for it and directed him as to what work to do and how to do it, and all such work was for its benefit. 4. Although both the Produce Co. and the Smith Co. paid (insurance) premiums on claimant and Chapmond respectively, the said premiums should have been paid by South-Ark., but that does not in anywise preclude claimant from being an employee of South-Ark. (It appears that South-Ark. also paid premiums on Roberts.)

After carefully considering the record in this case together with the excellent and exhaustive briefs presented by all parties we have reached the conclusion that the judgment of the circuit court must be affirmed.

We think appellants have clearly and correctly pointed out the framework to be followed and the decisive issues to be considered in arriving at a proper conclusion in their quotation from 1 Larson’s Workmen’s Com pensation Law, 710, where under the heading “Lent Employees and Dual Employment” there appears the following:

“§ 48.00 When a general employer lends an employee to a special employer, the special employer becomes liable for workmen’s compensation only if
“(a) The employee has made a contract for hire, express or implied, with the special employer;
“ (b) The work being done is essentially that of the special employer; and
“(c) The special employer has the right to control the details of the work. ’ ’

Giving the findings of the Commission the same force as the findings of a jury, as we are bound to do we think there is substantial evidence in the record to support the Commission’s findings (set out above) that the three requirements are fully satisfied in this case.

(a) The Commission was justified in finding that South-Ark. either expressly or impliedly hired Roberts. His employment is admitted, and it remains only to determine who hired him or whose employee he was. It seems obvious he was not hired by the Produce Co. at the time of his injury because he was not doing any work for that company and it was not paying him. It is most difficult to understand how Roberts could have been an employee of the Smith Co. unless that company was an independent contractor employed to construct the mill, and there is no contention or evidence this was the situation. It is, of course, true that Roberts was formerly a regular employee of the Produce Co. and that he did, at times, work for it while the mill was being constructed, but these facts alone do not preclude him from being an employee of appellant at the time he was injured. See: Larson, supra, § 48.50; Stuyvestant Corporation v. Waterhouse (Fla.) 74 So. 2d 554; Seaman Body Corporation v. Industrial Commission, 204 Wis. 157, 235 N. W. 433; and Nepstad v. Lambert, 235 Minn. 1, 50 N. W. 2d 614.

In the Waterhouse case, supra, at page 559, the Court said:

“Basically and fundamentally, after all the chaff is cast aside, the solution of almost every such case finally depends upon the answer to the basic, fundamental and bedrock question of whether as to the special employer the relationship of employer and employee existed at the time of the injury. If the facts show such relationship, the existence of a general employer should not change or be allowed to confuse the solution of the problem.” Likewise in the Lambert case, supra, at page 621, it was said:
“Since both employers may each have some control, there is nothing logically inconsistent, when using this test, in finding that a given worker is the servant of one employer for certain acts and the servant of another for other acts. . . . The crucial question is which employer had the right to control the particular act giving rise to the injury. In this connection, Restatement, Agency, § 227, comment a (2), states:
“. . . Since the question of liability is always raised because of some specific act done, the important question is not whether or not he remains the servant of the general employer as to matters generally but whether or not, as to the act in question, he is acting in the business of and under the direction of one or the other.’ (Italics supplied.)”

(b) There can be no question that the work Roberts was doing at the time of his injury was for South-Ark. and for its benefit. It is undisputed that South-Ark. authorized the building of the mill, that it was paying for it, and that it would own the mill when constructed. Clearly Roberts ’ work did not benefit the Produce Co. and it could not have benefited the Smith Co. unless, as previously stated, it was an independent contractor. Even though Bob McClure, manager of the Produce Co., and Keith Smith, president of the Smith Co., were both financially interested in South-Ark., still each of the three companies is a separate legal entity and, in this case, must be treated as such.

(c) Finally, it remains to determine which of the three companies had the right to control the details of Roberts’ work on the mill job. Again, we can proceed by the process of elimination. We know of no evidence or reasonable theory upon which it can be held that the Produce Co. had the right to say what Roberts should or should not do while he was working on the mill job. It was not paying Roberts and it does not show that it had any right whatsoever to control his activities on the mill job. It may be that the Produce Co. could have induced Roberts to quit working on the mill job and return to full time work for it, but the point is that it did not exercise that right before Roberts was injured. It is equally clear that the right to control Roberts’ work on the mill job was lacking in respect to the Smith Co. The only connection of the Smith Co. with the construction of the mill was that South-Ark. employed Chapmond (an employee of the Smith Co.) to supervise construction. This was done, of course, with the consent of the Smith Co. Chapmond was paid by South-Ark., and he was to work under the supervision of Keith Smith, who in turn was responsible to South-Ark. and not to the Smith Co. Also, there is no contention that Roberts’ services were contracted for either by Chapmond or the Smith Co.

Oh the other hand, there is direct substantial evidence that South-Ark. did have control over Roberts. Bob McClure testified that he had no control over Roberts while he was working on the construction job, but that Chapmond did have. Keith Smith, the general manager for South-Ark., testified that he could control Chapmond. Chapmond testified that he had control over Roberts while working on the mill job, and that Roberts was injured while working for South-Ark. Also, Roberts testified he took orders from Chapmond.

In view of all the above, we conclude that the judgment of the trial court must be, and it is hereby, affirmed.

Affirmed.


text:
    Mullally v. Carvill.
    5-2662
    356 S. W. 2d 238
    Opinion delivered April 16, 1962.

      E. L. Schieffler, for appellant.

      John L. Anderson, for appellee.
   Sam Robinson, Associate Justice.

The appellant, Earl Mullally, loaned his pickup truck to L. H. Heagwood to enable Heagwood to get to the place where Heagwood’s son had been involved in an accident. While Pleagwood was on this trip he had a collision with an automobile driven by appellee, Ed Carvill. There was damage to both Mullally’s truck and Carvill’s automobile. Mullally filed suit against Carvill for damages to the truck and Carvill filed a cross complaint asking compensation for damages to his automobile. There was a judgment for $645.00 on the cross complaint.

After all the evidence had been introduced, Mullally moved for a directed verdict in his behalf on the cross complaint contending there was no evidence of negligence on his part and that he is not liable for the negligence of Heagwood, if any, because Heagwood was in no manner acting for Mullally and that Heagwood’s negligence, if any, was not imputable to Mullally. The Court overruled Mullally’s motion for a directed verdict and instructed the jury that Heagwood’s negligence, if any, was imputable to Mullally. This was error.

Mullally was merely a gratuitous bailor and his motion for a directed verdict on the cross complaint should have been granted. There is no evidence of negligence on his part and since there is no evidence that Heagwood was in any wise acting for Mullally, Heagwood’s negligence was not imputable to him. In Sanders v. Walden, 212 Ark. 773, 207 S. W. 2d 609, the Court cited with approval Missouri Pacific R. R. Co., v. Boyce, 168 Ark. 440, 270 S. W. 519, which held that where a truck struck by a train had been loaned to the driver for use for his own pleasure, the driver’s negligence could not be imputed to the owner, nor be interposed as a defense as the negligence of a bailee is not imputable to the bailor where the subject of bailment is damaged by a third person. See also 5 Am. Jur. 781.

In 6 Am. Jur. 313 it is said: The relationship of bailor and bailee is not, as such, within the doctrine of respondeat superior; at common law it seems to be very well settled, both in bailments for gratuitous use and in lettings for hire, that the bailor cannot be held responsible to a third person for injuries resulting from his bailee’s negligent use of the bailed property, in the absence of any control exercised by the bailor at the time or of negligence of his own which proximately contributed to the injuries.” Dozens of cases are cited in support of the text.

The issue of the alleged negligence of the parties was submitted to the jury under the comparative negligence doctrine. The judgment states that the jury found no negligence on the part of appellee, Carvill. The jury having found Carvill guilty of no negligence, there is no error prejudicial to appellant, Mullally, on his complaint. As heretofore pointed out, there should have been a directed verdict for appellant on appellee’s cross complaint. The judgment is therefore reversed and the cause dismissed.


text:
    Aetna Ins. Co. v. Warren, Admx.
    5-2649
    356 S. W. 2d 233
    Opinion delivered April 16, 1962.

      Dickson, Putman S Millwee, for appellant.

      Crouch, Jones, Blair & Cypert, for appellee.
   Neill Bohlinger, Associate Justice.

The appellant is an insurance company which issued its policy of insurance to the Bon Ton Cleaners in Springdale under which it insured the Bon Ton and its customers for loss or damage by fire, as well as other hazards, on all kinds of lawful goods and articles accepted by the Bon Ton Cleaners for cleaning, renovating, pressing, repairing or dyeing while such property was on the premises of the insured Bon Ton. The policy did not insure against loss of or damage to goods held on storage.

The appellee, Mrs. Albano Maestri hereinafter referred to as appellee, resides at Tontitown in Washington County and had been a customer of the Bon Ton for several years.

Sometime during the month of April, or May, of 1957, the appellee delivered to the Bon Ton route man certain items of fall and winter clothing and instructed the route man that the clothing was to be cleaned, put in moth-proof bags and held until called for. In the month of July, 1957, a fire occurred on the premises of the Bon Ton Cleaners in Springdale and appellee’s clothing, which was in the custody of Bon Ton Cleaners, was destroyed or damaged in the amount of $230.60 for which amount suit was brought against the appellant At the conclusion of the testimony presented in the trial of this case in the Washington Circuit Court, a verdict was directed for the appellee in the sum of $230.60 plus penalty and attorney’s fee in the sum of $300.00 against appellant, from which comes this appeal.

The point to be determined here is whether or not the clothing belonging to appellee was entrusted to the Bon Ton Cleaners for “cleaning, renovating, pressing, repairing or dyeing,” or was it on the premises of Bon Ton for storage. If it was in the hands of Bon Ton for storage it was not covered by the policy sued on. There is testimony in the record that the regular custom between Bon Ton and its customers at Tontitown was for its route man to pick up the clothes to be processed and return them the following trip unless picked up sooner by the owners. The clothing which the appellee delivered to the Bon Ton route man in April or May, 1957, was fall and winter clothing. The testimony of Mrs. Maestri in regard to her intention in delivering the clothes to the cleaner is clear. The clothing was fall and winter clothing and she did not contemplate the use of the clothing until fall or winter or cooler weather. She told the route man of the Bon Ton to have the clothes cleaned, put in moth-proof bags and held until called for.

In order for the clothing to be considered as held in storage it was not necessary for the owner to state, “I instruct you to hold these clothes on storage.” Webster defines storage as the act of storing or state of being stored. The instruction which Mrs. Maestri gave to the route man constituted a deviation from the custom or accepted usage that had prevailed between the parties heretofore, that is, instead of having the clothing processed and re-delivered to her on the next trip, he was instructed to clean and put in moth-proof bags and keep until called for. Evidence of custom or course of prior dealings between the parties is competent to consider in determining the meaning of the instructions given to the cleaner.

The case of Aetna Insurance Co., Inc. v. Warren, Admx., 231 Ark. 405, 329 S. W. 2d 536, was a case which involved this same insurance policy, the same cleaning and pressing establishment and almost the same identical facts. In that case the court also instructed a verdict against the insurance company and in reversing that cause, this court said:

“It, therefore, appears to us that this vital question, whether Mrs. Harp’s clothes were stored or not stored under the above quoted provisions of the policy and under the evidence as we have summarized it above is one that should be passed upon by a jury. If this were a case in which it could he said that fair minds could reach only one conclusion on the question of whether Mrs. Harp’s clothes were stored or not stored then the trial court would be right in treating the question as a matter of law. We are unable to say that the testimony in this case is that simple and clear and we are, therefore, constrained to conclude that this issue should have been submitted to a jury. It follows from what we have said above that the trial court erred in finding that as a matter of law that Mrs. Harp was entitled to recover for the cost of her clothes.”

We have many times held that a jury question is presented where reasonable minds might reach different conclusions. Grand Lodge A. O. U. W. v. Banister, 80 Ark. 190, 96 S. W. 742; St. Louis I. M. & S. Ry. C v. Coleman, 97 Ark. 438, 135 S. W. 338; D. F. Jones Const. Co., v. Lewis, 193 Ark. 130, 98 S. W. 2d 874; Smith v. Stuart C. Irby Co., 202 Ark. 736, 151 S. W. 2d 996; McGeorge Contracting Company v. Mizell, 216 Ark. 509, 226 S. W. 2d 566; and, Williams v. Cooper, 224 Ark. 317, 273 S. W. 2d 15. There is abundant testimony in this record from which the jury might have determined the value of the clothing and that the clothing involved was delivered to the Bon Ton Cleaners for storage and these issues should have been presented to the jury.

For error of the trial court in directing a verdict for the appellee this cause is reversed and remanded for further proceedings in accord with this opinion.