author: Carleton Harris, Chief Justice.

text:
    Curtis CHAMBERS v. Lucy McKNIGHT and Rosetta McDONALD
    73-250
    506 S.W. 2d 844
    Opinion delivered March 25, 1974

      Baker & Pittman, for appellant.

      Dan Felton III, for appellees.
   Carleton Harris, Chief Justice.

This is a will contest. Virgin Sims Nicholson, approximately 85 years of age, executed a will on March 30, 1968, leaving all of her property, consisting of certain real property, valued at over $20,000, and personal property in the approximate amount of $9,000, to her nephew, Curtis Chambers, appellant herein. Mrs. Nicholson died on September 8, 1973, survived by her sister, Rosetta McDonald, and seven nieces and nephews, including Curtis Chambers. The will was offered for probate, but Rosetta McDonald and one of the nieces, Lucy McKnight, contested the will, contending that Mrs. Nicholson was not mentally competent to make a will on March 30, 1968, and also alleging undue influence. On trial, the Lee County Probate Court agreed with the contention that Mrs. Nicholson was not mentally competent to execute the instrument and a decree was entered finding that the petition for probate of the will should be dismissed because of Mrs. Nicholson’s lack of sufficient mental capacity to execute the aforementioned will. From the judgment so entered, appellant brings this appeal. For reversal, it is simply urged that the Probate Court erred in finding that Virgin Sims Nicholson lacked sufficient mental capacity to execute her Last Will and Testament dated March 30, 1968.

It might be said at the outset that this litigation is what might be termed a “close case”. The record reflects that Mrs. Nicholson, formerly a school teacher, was in ill health during the last several years of her life, but the testimony is very much in conflict as to her mental capacity. Lucy McKnight testified that Mrs. Nicholson stayed with her for about two weeks in February, 1968, but did not realize the identity of Mrs. McKnight; that she did not recognize other people; she had to be reminded to use the bathroom; she would walk away from the premises; the witness had to put a lock on the outside of the door to keep her aunt inside the house; she didn’t know how to put on her clothes. The witness said that Mrs. Nicholson was not living with her husband at the time because he was in bad health himself, but that after two weeks, she called the husband and asked him to come and get his wife. Rosetta McDonald, the only sister, added but little to the testimony other than to say that she and her sister were very close and loved each other. John L. Chambers, a nephew, testified that he did not visit his aunt prior to March 30, 1968; that he visited her in 1971 and she did not know him, nor did she recognize people who were around her. He knew nothing, of course, about her condition at the time of the making of the will. Annie Mae Surgeon, operator of the Tri-State Nursing Home, testified that Mrs. Nicholson was a patient in that nursing home, being admitted in August, 1968. She said that Mrs. Nicholson’s husband and stepdaughter brought her to the facility, stating that they were unable to keep Mrs. Nicholson since she would wander off from home. Mrs. Surgeon testified Mrs. Nicholson was confused, uncooperative, did not know who brought her to the nursing home, and that she called her family and everyone in the nursing home “chickens”. She said that the patient would pull off her clothes and walk down the corridors, hide her shoes in her clothing, lock herself in the room, and the witness was of the opinion that Mrs. Nicholson never knew where she was or what she was doing. She said this condition was observed from the day she was admitted until the day she was discharged. She described Mrs. Nicholson’s mental status as “very bad”; she was a patient at the nursing home from August 17, 1968 until March 18, 1971. During this period of time, her husband died. She was taken from the home by appellant, who, on October 2, 1970, had been named guardian, and she lived with him until her death.

The principal witness on behalf of the contestants was Dr. George T. McPhail, a practicing physician of Forrest City, who testified by deposition. He had known Mrs. Nicholson and her husband apparently for a long period of time and he said that she was a patient, formerly came to his office, and he had placed her in the hospital on two different occasions. The doctor said that her physical condition was such that she could have “carried on” but that primarily, “she was a mental case.” He had her admitted to the hospital on January 14, 1967, and she was discharged on January 31, 1967; she was again admitted on January 16, 1968 and dis-r charged on January 27, 1968. From his testimony:

“She had got to where Uncle Joe [her husband] couldn’t handle her. She would wander off from home and Uncle Joe couldn’t handle her. Uncle Joe and I were good friends.. I visited in their home. He was a fine old gentleman and had all his faculties, right up until he died.
“She had a cardiovascular disease with generalized arteriosclerosis, gone beyond any hope of return.”

The record reflects that he tried several different types of medication to help her.

“I gave her Synalgos to try to dilate the cerebral vessels to improve her mentality but I have never seen it do a lot of good; gave massive doses of Mellaril (50 mg.) tablets to quiet her enough to even keep her in the hospital. She wandered off from the hospital on occasions and they found her down on the street.”

When asked if she recognized him he said that he did not believe she knew who he was. He stated that he saw her every day and when asked to tell what he observed about her conduct and demeanor replied:

“She was a senile, elderly colored female, who had already lived too long.
She didn’t know the things around her and wasn’t cognizant of anything I was trying to do for her. After I discharged her from the hospital, Uncle Joe brought her up here to the Clinic until she finally got so weak he couldn’t handle her and he had to put her in the nursing home. He cried. He didn’t want to. I guess I have given him 1,000 Mellaril tablets to give her. He had to keep her heavily sedated.”

Relative to her disease, the doctor described it as “permanent and progressive”, a “degeneration of the brain”. When asked if, in his opinion, she was capable of understanding on March 30, 1968, the act of making a will, whether she had sufficient mind and memory to recall without prompting, the extent and condition of her property which was disposed of, and whether she had the mental capacity to understand her relationship to those persons affected by the will, he answered without equivocation in the negative, and was emphatic that, in his opinion, she was even in worse condition on March 30 than two months earlier when he had last observed her.

When asked on cross-examination if Mrs. Nicholson could have had a lucid interval, the doctor replied:

“No, not with her disease. Her brain had degenerated to the extent — when enough oxygen is shut off from the brain, the brain degenerates and a person becomes a vegetable, which was what she was.”

He said that a lunatic can have a lucid interval but not one with the particular disease suffered by Mrs. Nicholson.

At the time of the execution of the will, Mrs. Nicholson, though married, was staying with Chambers, it appearing that her husband was a patient at the hospital in Forrest City. Appellant testified that he told hi»aunt he would like “the place” (meaning her property in which Curtis was living, appellant renting said property), stated that they discussed it, and she told him to contact a particular lawyer in Marian-na. This he did, and the lawyer came out, talked with her about her property and desires of disposition, returned to his office and two or three days later, came back to the house accompanied by his wife, with the prepared instrument. Chambers testified that the will was explained to Mrs. Nicholson and that she understood what was being done. This elderly lady, though a former school teacher, and ap-prently considered as having been a capable school teacher, did not sign her name, but executed the will by mark. Lando Reed, 71 years of age, who testified that he had known Mrs. Nicholson three or four years, a neighbor, witnessed the making of the mark, as did,]. E. Young, who had known her for a long number of years. Both of these people testified that they saw her sign her “X” mark and it appeared that she was nervous. Young testified that the attorney explained the provisions of the will to Mrs. Nicholson, read it to her, asked if she understood, and she replied in the affirmative. Both of these men testified that it was their belief that she understood what was taking place and that she was of sound mind at the time. The lawyer, since deceased, and his wife, also signed the instrument as witnesses. The attorney’s spouse testified that her husband had represented Virgin for about twenty years, and that she had known the testatrix for many years. She said that her husband read the will, asked Mrs. Nicholson if she understood, and received an affirmative reply; that Mrs. Nicholson recognized her when she came into the house and spoke to her. It was her opinion that the testatrix was of sound and disposing mind and memory at the time of the execution of the will. She said that Mrs. Nicholson seemed perfectly normal for a person of her age, although it was obvious that she was ill.

Dr. Bernard Capes, a physician of West Helena, testified on behalf of appellant by deposition, and in answer to a long, hypothetical question, embracing the testimony that had been offered, stated that in his opinion Mrs. Nicholson could have been mentally competent to execute the will on March 30, 1968. He said that arteriosclerotic senility is a type of mental, disease, but it does not mean that a person cannot have lucid moments and he commented that his idea of a “vegetable” and that of Dr. McPhail might be different, although he agreed that if a disease reaches a point where someone could properly be so classified, the condition, of course, would be permanent. Dr. Capes did comment that since Dr. McPhail had treated the patient for many years, particularly during her 1967 and 1968 admissions to the hospital, and was accordingly in a position to observe her conduct through actual observation, Dr. McPhail’s medical opinion should be given great weight.

As earlier stated, this is a close case and the facts are such that whatever the probate judge decided, it would be difficult to say that his findings were against the preponderance of the evidence. It is apparent from his opinion that great weight was accorded the testimony of Dr. McPhail, the court stating:

“The Court is impressed with the medical testimony of Dr. McPhail. He was the family physician, and had known this woman, and her husband, for years. His acquaintance was not limited to the two periods of hospitalization. He had seen her condition coming on for quite a while. He was positive that she had . . . gone beyond any hope of return.’ She was last seen by Dr. McPhail in January, 1968. The doctor was of the opinion that she was ‘even worse (in March, when the will was executed) than she was the last time I had seen her.’ Dr. McPhail further testified on cross examination that in his opinion she could not have had a ‘lucid interval’ during which she would have been competent to execute a will.
Although there is the medical testimony of Dr. Capes, it is not based on first-hand knowledge; but rather upon a hypothetical question.”

The court then commented that in making its findings, it did not discredit the testimony of the witnesses to the will, but it was observed that those witnesses only saw the decedent briefly ; further, that the will was executed in the home of the appellant with then then living husband of Mrs. Nicholson not present; that appellant had told Mrs. Nicholson that he wanted “the place” and had mentioned to her the matter of whether she should make a will. It was recognized that appellant Chambers had looked after Mrs. Nicholson for a good part of her last illness but “the beneficiary knew that the will had been executed, and human nature being what it is, would have an incentive to act as he did.”

We have many times said that in will contest cases, unless we can say that the order of the trial court is not supported by a preponderance of the testimony, it is the duty of this court to affirm. See Hiler v. Cude, Executor, 248 Ark. 1065, 455 S.W. 2d 891, and cases cited therein. We cannot say that the findings of the trial court are not supported by a preponderance of the evidence.

Affirmed.

       Appellant stated that this was because she had a sore hand.


source: Caselaw Access Project

author:
Carleton Harris, Chief Justice. John A Fog lemán. Justice,
      Conley Byrd, Justice,

license: Public Domain

text:
    LOCAL NO. 34, INTERNATIONAL ASSOCIATION of FIRE FIGHTERS et al v. CITY of LITTLE ROCK
    73-261
    506 S.W. 2d 836
    Opinion delivered March 25, 1974

      R. W. Laster, Thorp Thomas and J. H. Cottrell, for appellants.

      Joseph C. Kemp, for appellee.
   Carleton Harris, Chief Justice.

Appellant union, and three individuals, in a class action, representing firemen of the City of Little Rock, including retired firemen, instituted suit in the Pulaski County Circuit Court, asserting that under the provisions of Ark. Stat. Ann. § 19-2108 — 09 (Repl. 1968) (Act 132 of 1955, as amended by Act 264 of 1957), they were entitled to thirteen paid holidays a year and that the City of Little Rock had failed and refused to give such additional pay, or in the alternative, to allow the firemen an additional thirteen days paid vacation per year. It was prayed that their rights be determined and that the court appoint a special master for the purpose of taking proof to establish the amount due individual members and retired members of the Little Rock Fire Department; that judgment be awarded based upon the findings of the master. The City answered denying that it had failed to pay appellants, and in an amended answer, the statute of limitations was pleaded. Following the trial, the court found that appellants had failed to establish their case by a preponderance of the evidence; further, that' appellants had throughout the years acquiesced in the position taken by the City, and the complaint was dismissed. From the judgment so entered, appellants bring this appeal. For reversal, it is alleged that the court erred in these two rulings.

William Glen Roberts testified that he had served as a fireman for the City of Little Rock for a continuous period of nineteen years, and he said that since 1955 he had not been paid additionally for the thirteen legal holidays; i.e., he had not received any paid vacation time other than his regular vacation. Roberts stated that his statement of earnings appearing on each check had no reference to pay for legal holidays; that he was aware of the enactment of legislation in 1955 granting thirteen days pay for holidays, but he was not familiar with any action taken by any fireman to enforce provisions of the act. He said that the act had “been negotiated ever since it was passed”, though he could not name any of the negotiators. He further stated that there had been no reduction in his pay and he had received increases over the years.

Gerald G. Melton, a fireman for the City for almost twenty-two years, also stated that he was familiar with the passage of the act heretofore referred to, and further testified that in 1957, he received the thirteen holidays and pay therefor, which was in addition to his regular vacation, but since that time he had not received additional pay for the holidays. He said that since 1957 he had requested additional time off but had been refused. Melton testified that in 1955, the pay for firemen was cut as a matter of compensating for the legal holidays and then in the same meeting, and under the same ordinance, increased back to the identical figure but including pay for the holidays. He said that some members of the Little Rock Fire Department (apparently administrative personnel) do have time off for the legal holidays, but that line personnel (the firefighters) do not because of the nature of their duties, meaning that the only method by which they can be compensated is by drawing the additional pay. He mentioned that he had drawn an additional check for longevity pay.

Chief Jack Davis, employed by the department for something over thir* y years, and who has served as chief for over nine years, testified that in preparing the budget, he did not break down equalization pay for the holidays for any fireman. He said, that in budget preparation he included operating, maintenance and capital expense, and recommended what was needed in the way of pay for the line firemen; further, that inspectors have time off for holidays but this actually is only compensatory because these men are used a lot at nights. The Chief stated that the budget he prepared was for informational purposes only and he had nothing to do with actually establishing the budget used. He testified that the hours of the firemen since 1955 had been reduced from time to time; that stated pay has been received by the firemen, and in preparing his budget for the salaries, the thirteen days holidays had been included.

Jack Murphy, Director of Finance for the City of Little Rock since 1960, testified that he was familiar with the Fire Department budget and that there was not, per se, a specific item setting out equalization pay for each fireman for legal holidays; that the City only showed a line item for total compensation. He called attention to a City Ordinance, 12,572, Defendant’s Exhibit 2 in the record. Section 5 reading as follows:

“The appropriations made herein include additional pay for holidays for all agents, servants and employees of the City of Little Rock, including but not limited to uniformed employees, as provided for by the laws of the State of Arkansas.”

He said that this language had been incorporated in all budgets as far back as 1963 with the exception of one year, and this testimony is not disputed.

John T. Meriweather, City Manager of Little Rock since January of 1969, testified that the legislative acts were considered in preparing the budget and “rather than break it out separately we attempted through the development of a pay plan to give consideration to the fact that these men are required to work on holidays delineated by the state as holidays and the pay for these holidays would be established and spread out on a pro-rated basis across all of the mechanics of the department.” He said that since his tenure of office had commenced, no fireman or group had discussed the issue with him.

In its Memorandum Opinion, the court called attention to the fact that the burden of proof was upon appellants to establish their case, the court recognizing that it was difficult to show by a preponderance of the evidence that they had not received compensation in accordance with the provisions of the state statutes, earlier mentioned. The trial judge commented that the strongest point on their behalf was that the “Statement of Earnings”, which each man received, made no mention of “Holiday Pay”. The court then commented that the law presumes that public officials will discharge their duties according to moral and legal obligations, and the clause appearing in each budget ordinance since 1963 (with one exception) had contained the provision that the appropriation for salaries included additional pay for holidays as provided by the laws of the State. Further, from the record:

“The Court finds that Plaintiffs have not proven by a preponderance of the evidence that the above quoted language has no meaning and is untrue. In the light of admitted increases in pay over the years coupled with shorter working hours, this Court cannot say the City Directors were acting without regard to the requirement that additional pay for holidays be considered and applied.”

The court also observed that all firemen throughout the years had known of the provisions of the statutes but had uniformly acquiesced with the City’s position that in fixing salaries for firemen, pay for holidays had been included and pro-rated.

We are forced to conclude that the trial court’s finding relative to appellants’ failure to establish their case cannot be overturned. There really is no evidence to disprove the clause appearing in the various appropriation acts over the years. The City’s position, not only in the briefs, but at oral argument, was emphatically set out to the effect that the City does include the thirteen days holiday pay for firemen in the budget, and that it is paid to the firemen on a pro-rated basis over the year. The burden of proof, of course, is on the plaintiff in a lawsuit to establish his case by a preponderance of the evidence. As stated by the trial court, it appears that the strongest and principal circumstance relied upon by appellants is fhat the holiday pay was not specifically itemized. While we agree that this might well be a better method of handling the matter, there is no statutory requirement that this be done. Of course, we cannot approve the action of appellee in 1955 when, following the passage of Act 132 of 1955, it reduced the salaries of firemen, and then, in the same ordinance, raised them back to the same amount as a matter of grainting the extra pay, and litigation at that time by appellants might well have resulted in a favorable verdict, but it must be borne in mind that this occurred some nineteen years ago, and in the meantime, the City vigorously contends that it has, for a long number of years, heeded, and observed, the statutory acts as well as granted pay increases and shorter working hours.

Summarizing this point, we really get down to the fact that the statement-of earnings did not specifically identify the amount representing holiday pay, but this is not proof that the Board of Directors of the City of Little Rock has failed to comply with such statutes.

The trial court also commented on the fact that though firemen have known for many years of the statutes in question, they have acquiesced in the manner in which pay has been calculated and have consistently accepted this system of payment. It is true that this is normally a circumstance to be considered. In Walnut Grove School District No. 6 v. County Board of Education, 204 Ark. 354, 162 S.W. 2d 64, we said:

“As a general rule executive and administrative officers will be-called upon to interpret certain statutes long before 'the .courts may have an occasion to construe them. Inasmuch as the interpretation of statutes is a judicial function, naturally the construction placed upon a statute by an executive or administrative official will not be binding upon the court. Yet, where a certain contemporaneous construction has been placed upon an ambiguous statute by the executive or administrative officers, who are charged with executing the statute, and especially if such construction has been observed and acted upon for a long period of time, and generally or uniformly acquiesced in, it will not be disregarded by the courts, except for the most satisfactory, cogent or impelling reasons. In other words, the administrative construction generally should be clearly wrong before it is overturned. Such a construction, commonly referred to as practical construction, although not controlling, is nevertheless entitled to considerable weight. It is highly persuasive.”

Further discussion of this point, however, is unnecessary since we think Point 1 heretofore discussed, is controlling, and we predicate our decision upon that basis, holding that appellants did not meet their burden of proof.

Affirmed.

Fogleman.J., concurs; Bvrd, J., dissents.

John A Fog lemán. Justice,

concurring. I concur but I do not agree that the acquiescence of the firemen or the action of the city should be regarded as an administrative construction of the act which should be given any consideration by either the trial court or this court. The Little Rock construction would thereby be an influencing factor in later determining the meaning of the act in Fort Smith, Pine Bluff, North Little Rock and elsewhere. To me, the long acquiescence of the firemen is to be considered only in determining whether there was substantial evidence that the city had complied with the act since 1963, when the pertinent clause appeared in the budget ordinances.

Conley Byrd, Justice,

dissenting. Arkansas Statutes Annotated § 19-2109 requires that the holiday pay . . shall he based on each man’s daily rate of pay and in addition to the regular pay schedule. ” I can find nothing in the record to show that these firemen have been paid anything other than the “regular pay schedule.” The inclusion in all budget appropriations of the city that “The appropriations made herein include additional pay for holidays ... as provided for by the laws of the State of Arkansas” is only a conclusion and is not proof of the fact that holiday pay was paid in addition to the “regular pay schedule.” The fact that the same clause is attached to identical budgets involving employees not entitled to holiday pay under the laws of Arkansas only adds emphasis to the conclusionary nature of the City’s position and proof.

Of course the EASE with which the majority opinion permits cities to circumvent the mandatory holiday pay requirements so effectively mutilates the holiday pay statutes that they become nothing more than empty rhetoric.

For the reasons stated, I respectfully dissent.

       This occurrence is not disputed by the city.

       It should be pointed out that the ordinance itself states that the reason for this action was to prevent a violation of Amendment 10 to the Arkansas Constitution which provides that a city cannot exceed its revenues for any one year. However, this argument is not advanced by appellee in its brief or oral argument as the basis for passage of the 1955 ordinance. The record does not reflect the financial status of the City in 1955.


author: George Rose Smith, Justice.

text:
    Ruby Evans WELCH and Hazel Evans PARKS v. Marolyn Moore TARVER and Carolyn Moore HONEYCUTT
    73-260
    507 S.W. 2d 505
    Opinion delivered March 25, 1974
    [Rehearing denied April 29, 1974.]

      Shackleford & Shackleford, for appellants.

      II. Derrell Dickens, for appellees.
   George Rose Smith, Justice.

This suit for a declaratory judgment was brought by the two appellees, twin sisters, to obtain a judicial construction of a quitclaim deed by which their grandmother. Mary Etta Evans, at the age of 96, conveyed a 120-acre tract of land to her two daughters, the appellants (who are the appellees’ aunts). At the time of the conveyance the grantor had a life estate in the land, coupled with a power under her husband’s will to dispose of the fee simple. The chancellor construed the deed to convey only the grantor's life estate, which means that the appellees receive under their grandfather’s will an undivided one-third interest in the land. For reversal the appellants contend that their mother intended to convey the fee simple to them and that her deed should be so construed.

Counsel agree that the problem is that of determining the grantor’s intention. The controlling rule of construction was stated in Walters v. Bristow, 77 Ark. 182, 91 S.W. 305, 113 Am. St. Rep. 136 (1905), where, as here, the grantor had a life estate in addition to the power:

“The question of whether a deed is made in execution of a power contained in a will is one of intention, to be gathered from the terms of the deed and from the circumstances under which it was made. It is not absolutely essential that a deed should refer to the power in order to execute it; but when the deed is silent on that point, and the maker has an interest in the land that will pass by the deed, without regard to the power, this, if not conclusive, is a circumstance tending strongly, to show that there was no intention to execute the power.”

In the case at bar the land was formerly owned by Mrs. Evans’ husband, W. F. Evans, who made his will in 1948. Three paragraphs of the will are pertinent:

“2. I give and bequeath to my beloved wife, Mary Etta Evans, all of my property, both real and personal, for her own use and benefit for and during her lifetime. She is hereby authorized to keep, rent, lease or sell and dispose of the same if she so desires.
“3. [Bequests of $100 each to the testator’s three sons] out of whatever my wife has not in her lifetime disposed of.
“4. All of the rest, that may be left of my estate, after the death of my said wife, and after the payment of the amounts as above provided to my sons, I give and bequeath to my daughters, Edry Evans Moore, Ruby Evans Durrett and Hazel Evans Miles, to share and share alike.”

Edry Evans Moore, one of the testator’s three daughters and the mother of the appellees, predeceased her father, who died in 1959. After the testator’s death his widow, Mary Etta Evans, and his two surviving daughters, the appellants, consulted an attorney, who erroneously told them that no one else had any interest in the estate. In fact, of course, the devise to Edry, who predeceased her father, did not lapse but vested in Edry’s children, the appellees. Ark. Stat. Ann. § 60-410 (Repl. 1971). Nevertheless, the widow and the two surviving daughters apparently believed throughout the widow’s lifetime that Edry’s daughters, the appellees, had no interest in the estate and that the appellants would own the property upon their mother’s death.

It is the appellants’ contention that they entéred into a binding oral agreement to take care of their mother for the rest of her life, in return for her promise to deed to them the 120-acre tract on which Mrs. Evans resided. Both of the appellants testified that they lived up to their agreement, with one or the other of them staying with their mother and taking caré of her from about 1960 until Mrs. Evans’s death on February 10, 1972.

The quitclaim deed now in question was executed by Mrs. Evans about a year before her death, on February 21, 1971, though it was not recorded until May 5, 1972. The deed was prepared by the husband of one of the appellants, Joe Parks, a layman, who used a standard printed form of quitclaim deed which recited that the grantor did thereby “grant, sell, convey and quitclaim” to her two daughters the 120-acre tract in issue. The deed made no reference to the power, which, under the Walters case, supra, is a circumstance tending strongly to show that there was no intention to execute the power.

A weakness in the appellants’ position arises from their admitted efforts to obtain quitclaim deeds from the appellees within a few days after Mrs. Evans’s death. The .appellants had consulted an attorney, who advised them to get deeds from their nieces, the appellees. Joe Parks, who alone testified about the lawyer’s advice, was somewhat vague about the reason for the attorney’s suggestion: “As well as I recall, the reason was that in the distant future at any time in years to come, if ever any disposition was to be made of the property, some attorney, in examining the past history of the property, might bring up a question as to whether or not these people [the appellees] had any interest and if they did we thought that they would be kind enough to cooperate and sign a quitclaim deed, then that would eliminate any possibility of any question ever arising on it.”

The chancellor may well have doubted the candor of that testimony. The statute, cited above, is so fundamental and so plain that no competent lawyer would have failed to inform his clients that under the will of W. F. Evans the devise to Edry did not lapse upon her death but vested instead in her surviving daughters. Yet, according to the testimony, when the effort was made to obtain quitclaim deeds from the appellees, the latter were told that under their grandfather’s will they had no interest in the property. The appellees understandably inquired why they were being asked to execute deeds if they had no interest in the land. The only answer given was somewhat lame: That the appellants’ brothers had resented the terms of their father’s will and might also have become angry at their late mother for having deeded the land to the appellants, if that fact could not be concealed by the execution of the requested deeds.

It must also be remembered that the two appellants, and apparently their mother as well, believed all through the mother’s lifetime that no one except those three had any interest whatever in the property. In that view there was no reason for Mrs. Evans to convey anything more than her life estate to her daughters, for they supposedly already owned the remainder. Consequently the chancellor may well have concluded that the appellants’ present reliance upon an asserted oral agreement was an afterthought that arose when it became apparent that the appellees had a one-third interest in the estate and refused to relinquish it.

We do not discount in any degree the appellants’ commendable generosity in taking care of their aged mother for many years. The question, however, is whether that solicitude was based upon the asserted oral agreement or was simply an expression of ordinary filial devotion. Upon the record as a whole we cannot say that the chancellor’s decision is clearly contrary to the preponderance of the evidence.

Affirmed.


text:
    J. B. WILSON v. Joan RODGERS et al
    73-282
    507 S.W. 2d 508
    Opinion delivered March 25, 1974
    [Rehearing denied April 29, 1974.]

      Milton G. Robinson, for appellant.

      Macom, Moorhead & Green, by: Wm. M. Moorhead, for appellees.
   George Rose Smith, Justice.

This is the third appeal in a suit to determine whether certain real property was owned by two brothers as partners or by only one brother individually. Upon the second appeal it did not appear that the chancellor had considered the entire record in deciding disputed issues of fact. We found the evidence to be so evenly balanced that we could not say where the preponderance lay. We therefore remanded the case for the chancellor’s decision upon that point, on the entire record but without additional testimony. Wilson v. Rodgers, 254 Ark. 487, 494 S.W. 2d 484 (1973).

Pursuant to our mandate the chancellor re-examined the issues and concluded that the preponderance of the evidence favors the appellees. Counsel for the appellant now asks us to reconsider all the arguments that were presented upon the second appeal. We must decline that invitation. No principle is more firmly settled by our decisions than the rule that the matters decided upon one appeal become the law of the case and govern this court upon a second appeal, even though we might be inclined to say that we were wrong in the first instance. International Harvester Co. v. Burks Motors, 252 Ark. 816, 481 S.W. 2d 351 (1972). It follows that the chancellor’s decision is now conclusive upon the only issue that was left open by our opinion upon the second appeal. That ends the litigation.

Affirmed.


author: Lyle Brown, Justice.

text:
    John S. SELIG, Securities Commissioner v. Stephen R. NOVAK
    73-253
    506 S.W. 2d 825
    Opinion delivered March 25, 1974

      Kenneth E. Suggs, for appellant.

      Catlett & Henderson, for appellee.
   Lyle Brown, Justice.

Appellee Stephen R. Novak held a license issued by the Arkansas Securities Commissioner to act as agent for Raney Brothers, Inc., a broker-dealer registered with the Commissioner. Raney’s authority was restricted to transactions in municipal and other governmental securities. The Commissioner, after a public hearing on five charges instituted by appellant and against appellee, permanently revoked appellee’s license. On appeal to circuit court it was held that the findings upon which the Commissioner based the permanent suspension were affected by error of law and not supported by substantial evidence of record. The circuit court ordered that a one-year suspension of appellee’s license be substituted for the permanent revocation. Here the Commissioner advances three points for reversal: (1) that the finding of the Commissioner was supported by substantial evidence, (2) that the Commissioner did not commit any error of law, and (3) that the trial court erred in refusing to permit newly discovered evidence to be adduced before the Commissioner.

The present Arkansas Securities Act was enacted in 1959, it is based on the Uniform Securities Act and has been amended several times. It is codified in Title 67, Ark. Stat. Ann. (Repl. 1966) beginning with § 67-1235.

1. The Charge of Excessive Markups. In the latter part of 1969 and early 1970 appellee agent effected twenty-nine separate bond transactions with Ocean National Bank, Kennebunk, Maine; People’s State Bank, Mansfield, Ill., and the Bank of Danville, Danville, W. Va. According to evidence introduced by the Commissioner, the bonds were sold to those banks at an increase of selling price over cost ranging from 10.009% to 27.827%. The Commissioner contends that the markup is so excessive as to amount to a fraud on appellee’s clients and is condemned by Section 1 of the Act. Ark. Stat. Ann. § 67-1235 (Repl. 1966). The Commissioner avers that because of the fiduciary relationship it is the duty of the broker’s agent to disclose the markup. The National Association of Securities Dealers is recognized as a leading association in the industry and it is pointed out that the Association approves a markup policy under which the ratio should not normally exceed five percent. E. Gadsby, 11A Business Organizations, Federal Securities Exchange Act (Matthew-Bender 1973). The Commissioner argues that the primary purpose of the securities laws is “ ... to substitute a philosophy of full disclosure for the philosophy of caveat emptor and thus to achieve a high standard of business ethics in the securities industry”. Affiliated Ute Citizens v. United States et al. 406 U.S. 128 (1972). “The essential objective of securities legislation is to protect those who do not know market conditions from the overreachings of those who do." Hughes v. SEC, 139 F. 2d 434 (2d Cir. 1943). Several cases are cited wherein it was held to constitute fraud if an excessive markup was exacted. Hughes, supra; Otis & Co. v. SEC, 106 F. 2d 579 (6th Cir. 1939); Associated Sec. Corp. v. SEC, 293 F. 2d 738 (10th Cir. 1961); Handley Inv. Co. v. SEC, 354 F. 2d 64 (10th Cir. 1965); Merrit, Vickers, Inc. v. SEC, 353 F. 2d 293 (2d Cir. 1965).

Appellee responds by pointing out that we have no statute defining the term “fraudulently excessive markup”. He also says that appellant’s witness on the subject “assumed the market value of the bonds was the price paid for them by Raney Brothers, Inc.” Appellee also points up the fact that in the cases cited by appellant on markups, it was shown in every case that the markups were considerably higher than in the case at bar. Also, it is argued that when the total number of bonds bought by Raney and sold to Peoples State Bank is figured in toto, only a profit of 3.8% is shown; using the same method of calculation, appellee argues that a profit of 1.8% was shown on the transactions with Ocean National Bank. Finally, appellee points out that no witness testified there was a failure of disclosure to the banks or that appellee made any misrepresentation to the banks. Summarizing his defense to the charge of excessive markups, appellee says:

Now, then, there was no statutory provision defining excessive markups; no Rule or Regulation of the Securities Division covering excessive markups; no Rule or Regulation of the Division prohibiting adjusted trading; no proof as to the market value of the bonds traded; no complaints from the banks; no evidence as to the representations, if any, made to the banks; and no excessive profit realized.

2. The Charge of Dealing in Corporate Securities. Appellee’s license as an agent for Raney Brothers, Inc., restricted him to dealings in municipal and other governmental securities; in other words, he had no authority under his license to deal in corporate securities. It is not disputed that in November 1969, appellee purchased from Ocean National Bank seven groups of corporate bonds; that on the same date appellee sold to .Solomon ProA ts five «¡roups of corporate bonds; that on fanuan- 12 and { • M?,, aupeilec effected a sale of Ling-femco-Vought. 'Lk\ Ah onm-s hj Frederick W. Smith of Little Sock; and •’ >»• i-inuarv 17, 197k,. appellee was in-*;»irTr.s-p m . ■ ij, .. ,.\i , r be Srniüt of an additional i lire, -niiSo' dollars of Un- same issue of debentures.

In replying to die tLarge appellee contends that he handled during cacti o-' the years 1969 through 1971 an oa rage of 240 transan ions connected with municipal bonds; that the corporate transactions were isolated; and that “An isolated purchase and sale which occurred over three years ago is not a course of c onduct, but is inconsequential ...”

3. The Charge of Unethical Practices in Connection with the Transactions Concerning the Ling-Temco-Vought Debentures. As we have mentioned, appellee assisted in the negotiations on behalf of Mr. Smith in the purchase of 11,700,000 of LTV debentures. Appellee instructed LTV, without Mr. Smith’s knowledge, to draw the confirmation in appellee’s name and Mr. Smith's name jointly. Appellee used his apartment address for the delivery of the confirmation. It appears appellee Alt he was entitled to a fee of $150,000 for his personal services regarding the acquisition and apparently he wanted the confirmation so drawn because it would protect him in collecting his fee. (That fee was in addition to the regular commission charged by Raney Brothers.) The Commissioner ruled it was an unethical and dishonest practice, citing Sections 1(1), 1 (2), and 1 (3) of the Arkansas Securities Act. Ark. Stat. Ann. § 67-1235 (Repl. 1966). Appellee’s effort to collect the fee failed but ihe Commissioner said that had appellee been successful, he would have defrauded Mr. Smith and his company. Mr. Smith testified that at no time did he agree that ppellee would be compensated for his “special services” and his testimony was unconiradicted. (Appellee did not testify.)

The substance of appellee’s response may be summarized from his brief: “Placing Mr. Novak’s name on the confirmation was an obvious attempt to insure that Mr. Novak received whatever compensation he was entitled to. No matter how expansive the interpretation of the word fraud has been under the various securities acts in the United States if cannot reasonably be said that it includes actions taken to protect the actor’s legitimate interests”. And again: “This attempt to gain leverage to encourage such a settlement, clearly could not operate as a fraud or deceit on Mr. Smith or his company and thus Section 1(3) of .the Securities Act could not have been violated”.

4. The Charge of Churning Accounts. “Churning” is excessive trading by a broker who has a discretionary account with a customer in order to generate commissions for the broker with relatively little concern for the welfare of the customer. Pierce v. Richard Ellis & Co., 310 N.Y.S. 2d 266 (1970). In other words, every trading transaction brings a new commission to the agent. The Commissioner classified churning as a procedure that is prohibited by Section 1 of the Securities Act. Since that section is being referred to so many times we set it out. It is also found in Ark. Stat. Ann. § 67-1235 (Repl. 1966). It reads:

It is unlawful for any person, in connection with the offer, sale or purchase of any security, directly or indirectly
(1) to employ any device, scheme, or artifice to defraud,
(2) to make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they are made, not misleading, or
(3) to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person.

The Commissioner also ruled that churning of accounts is prohibited by Rule 4 (M) (6), Rules of the Securities Division. That Rule condemns as unfair and misleading “Willfully switching or ‘churning’ securities, including mutual funds, held by a customer, or reloading him with securities for the purpose of accumulating commissions”.

The twenty-nine sales and purchases to the three banks heretofore described were used by the Commissioner to sustain his finding against appellee of churning securities. Appellant makes this analysis in his brief:

It is important to note that of the 29 transactions charged against Mr. Novak, 21 were same day transactions. Of the remaining eight transactions, the lapse in time between Raney Brothers purchase date and Mr. Novak’s selling date range from only three to seven days, well within the meaning of a contemporaneous transaction for municipal bond purposes.

In defense of this charge, appellee offered the testimony of Mr. William Sherman, Arkansas Securities Commissioner from March 1969 through 1971. Mr. Sherman testified that in order to constitute churning, the securities dealer must have carte blanche authority and control over the account and some type of power of attorney to act without consulting the customer. Appellee contends appellant did not show that appellee had such authority over the three banks’ accounts.

5. The Charge of Falsifying Applications. It was charged that appellee falsified his original application in 1970 for an agent’s license and in his renewal applications in 1971 and 1972. The particulars of those charges were that he failed to disclose (1) his actual employment history; (2) that he had been licensed in 1964 as an agent for Bevark Investment Company, an Arkansas broker-dealer; (3) that he had been licensed in 1965 and 1966 as an agent for American Capital Enterprises; and (4) that his license mentioned in (3) had been revoked for cause in 1966. It was further charged that in his agent’s renewal application in 1971, appellee answered in the negative the question of whether he had been a defendant in a civil or criminal action during the previous year when in fact he had incurred a misdemeanor conviction for gambling in 1970.

The Commissioner contends that the foregoing falsifying charges constitute a violation of Section 16 of the Securities Act; Ark. Stat. Ann. § 67-1250 (Repl. 1966). Under that section it is unlawful to file any statement which is in any respect false or misleading.

Appellee did not attempt to rebut the proof. He contends they were minor errors and of no consequence, and that they were not material misrepresentations of important facts.

The Commissioner found appellee guilty on all counts and imposed the following penalties: (1) Churning, three months suspension; (2) Dealing in corporate securities, one month suspension; (3) Markups, LTV transactions, and misrepresentations in original application, permanent suspension; and (4) Failure to report gambling conviction, one month suspension.

The trial court wrote an exhaustive and helpful memorandum of its findings. The memorandum deals with those charges for which the Commissioner invoked permanent suspension. With respect to the charge of markups, it was noted that Chairman Selig stated “that the issue goes tó whether the markups were fraudulently excessive as opposed to whether they were reasonable”. The year in which the markups occurred was 1969 and Mr. Bill Sherman testified there were no rules and regulations in existence for the year 1969 relating to excessive markups. “And the tenor of his testimony is to the effect that Mr. Novak’s transactions were probably no different frmm that of other persons engaged in the business of selling securities.” The court concluded there was no substantial evidence in the record which would support revocation on the charge of markups.

With respect to the Ling-Temco-Vought transaction with Mr. Smith, the trial court considered it the most serious charge. However, it was concluded that Mr. Smith contacted appellee, not in his capacity of the seller of securities, but for appellee’s acquaintance with an LTV official and appellee’s capacity to locate the debentures Mr. Smith desired to purchase. It was noted that Mr. Smith had reason to know that appellee would expect remuneration for services rendered, although there was no specific agreement thereon. The court found there was no substantial evidence to the effect that placing appellee’s name on the confirmation constituted a scheme to defraud Mr. Smith.

With regard to the charge of giving misleading information, or withholding information on appellee’s original application, the court found there was no substantial evidence of giving false and misleading information of a material fact.

Appellee Stephen R. Novak filed his petition for review in the circuit court, citing a section of the Arkansas Administrative Procedure Act; Ark. Stat. Ann. § 5-713 (d) (Supp. 1973). That section directs that the record, upon application of petitioner, be transmitted to the circuit court for review. The circuit court, in examining the record on review, tested the record in light of Ark. Stat. Ann. § 5-713 (h) (Supp. 1973) and determined that the Commissioner committed error of law and that his decision was not supported by substantial evidence.

If the findings of the Commissioner as to the facts are supported by substantial evidence, and if those facts are competent and material, then those findings of facts are conclusive. Ark. Stat. Ann. § 67-1257 (Repl. 1966); Ark. Stat. Ann. § 5-713 (h) (5). See Jarvis v. Alcoholic Beverage Control Board, 253 Ark. 728, 488 S.W. 2d 712 (1973). We have already recited the essential disclosure of facts and of course will not repeat them. We have made a careful evaluation of the facts surrounding each charge and find them to meet the tests required by the statutes.

Now with respect to the finding of the circuit court that the Commissioner was in error as to the law. The only place in the trial court’s opinion where we find error of law applied is with respect to the Ling-Temco-Vought transaction. The court said “such conduct falls short of the legal definition of fraud”. We perceive that the court had in mind the common law rule as to fraud. It is provided in the Securities Act; Ark. Stat. Ann. § 67-1247 (d) (Repl. 1966): “ ‘Fraud,’ ‘deceit,’ and ‘defraud’ are not limited to common-law deceit”.

We agree with appellee that some of the violations (for example, “markups”) cannot be found spelled out in the statutes. However, those charges which cannot specifically be found in the statutes are covered by general language (which we have quoted) and reinforced by case law which has been developed over the years to protect the public from unethical conduct. We have discussed a number of those cases.

The judgment of the trial court is reversed and remanded with directions that the order of the Commissioner be reinstated.


text:
    Henry BAKER et ux v. Hazel SMITH and Wyoma JAMISON
    73-271
    506 S.W. 2d 842
    Opinion delivered March 25, 1974

      Jerry W. Faubus, for appellants.

      Moses, McClellan, Arnold, Owen & McDermott, by: William L. Given, for appellees.
   Lyle Brown, Justice.

This suit to try title to 3.63 acres of land was instituted by two sisters, Hazel Smith and Wyoma Jamison. They claimed title by virtue of a decree in a partition suit in 1945. Appellants based their claim on a tax forfeiture and adverse possession. The court held that appellants took possession of the lands under a rental agreement with appellees and that the purchase of the tax title by appellants, being tenants, amounted to a redemption in favor of appellees. The court also rejected the plea of adverse possession.

Appellee Hazel Smith testified that appellees had lived in Detroit for a number of years; that they first rented the land to an uncle, Charlie Baker in 1947, the agreement being that he would pay the taxes thereon; that Charlie Baker ceased farming a few years later and for that reason gave up possession; that appellant Henry Baker then asked if he could use the property; that an oral agreement was made by the two sisters with Henry Baker that they would rent the property to Baker and he agreed to keep the taxes paid and would also pay an annual rental of SI 5.00. She said appellees never received the annual rental payment “and I never asked for it because I was living in Detroit and I was only concerned that Mr. Baker pay the taxes". She said that on some of her return visits between 1949 and 1970, she would inquire of Baker if he was paying the taxes and he told her they were being paid. Then in 1970 she was advised by her uncle that the sisters had better look into the title to the property. The witness said she returned to Pulaski County that year and inquired of appellant Baker and she was referred to appellant Mrs. Baker. The witness learned from Mrs. Baker that the Bakers were claiming the property. The appellees went to the courthouse and found appellants’ deed on record. The deed was from Winford Walton who had obtained a tax deed to the land.

The other sister, appellee Wyoma Jamison, testified. She substantially corroborated the testimony of her sister. This witness apparently became confused, however, in her dates. At one point she testified she learned in 1950 or 1951 that appellants were claiming the property; then she later testified that the date was in 1968 or 1969.

Witness William McKinley Baker is related to all parties to the suit and lives in the neighborhood of the property. He said he had lived as a neighbor to appellants for many years; that it was his understanding that appellants were in possession of the property by agreement with appellees, saying, how'ever, he received that information from one of the appellees; and he further testified that appellant Henry Baker “never told me he claimed to own it”. He said he wrote Hazel Smith in 1970 suggesting that she had better check on her title at the courthouse.

Witness Charlie Baker is likewise related to all the parties to the litigation and lives in the same neighborhood with appellants. He testified that in 1949, appellant Henry Baker told the witness that he, Henry Baker, had rented the property for SI5.00 per year; that he, Henry Baker, did not tell the witness that he had also agreed to pay the taxes; however, he said Henry Baker did tell him that he was going to pay the taxes in appellees’ names. “Four or five years later Henry Baker told me he had not yet paid the taxes. He said money was a little short.”

It is undisputed that the land in question was forfeited for taxes for the year 1950 and that one Winford Walton obtained a tax deed thereto in 1954; and that in the same year Walton gave appellants a quitclaim deed for $50.00.

Appellant Henry Baker testified he never had a conversation with either of appellees about the property and that specifically he made no agreement with them to take posses’ sion, and that he had no conversation with appellees’ witness Charlie Baker in that connection. He said he took possession in 1954 under his deed; that he cleared the property of bushes, fertilized it, and seeded it with Bermuda grass. Continuously throughout the years he said he had used the property for grazing cattle.

It appears that the entire forty acres which includes the subject tract was, many years ago, the property of Tom Baker, in the partition suit heretofore mentioned, appellees obtained their tract and appellant Henry Baker obtained a tract. In other words, the forty acres was divided into small tracts and parceled out to several heirs, among which were appellants and appellees. Appellant Henry Baker conceded that he read the Walton deed on the date he received it and he realized then that the subject tract was a part of the heir property. He also conceded on cross-examination that he had never told any of the Baker heirs that he owned the property, in fací he said the only person to whom he had conveyed that information was one Benny Freeman. On redirect examination he said he had told a Mr. Sisk “that the property was mine and to keep his cattle off of it”.

Appellant Ruby Baker, wife of Henry Baker, testified neither of the appellees had ever talked to her about the land; that she witnessed her husband continually working the land, clearing and fertilizing, and erecting “no trespassing” signs thereon.

Witness Benny Freeman testified that on one occasion, many years ago, appellant Henry Baker said he owned the land. He also said he had seen Baker working the property.

Witness Herbert Baker is a son of appellants. He said he has annually assisted his father in working the property; that he heard his father tel! Louis Sisk to keep his cattle off the property; and that his father had erected “no trespassing” signs thereon.

We are unable to say that the findings of the chancellor were against a preponderance of the evidence. Also, the applicable law is not favorable to appellants. In Findley v. Tyler, 227 Ark. 663, 300 S.W. 2d 598 (1957), we said: “It is well settled that one in possession of land enjoying the rents and profits cannot acquire title thereto by permitting it to sell for the taxes and buying it at a tax sale, or by purchasing from one who has purchased at the sale”. The opinion goes ahead to say that such a transaction is regarded as a redemption. Then in Britt v. Berry, 133 Ark. 589, 202 S.W. 830 (1918), Britt entered into possession of the disputed land by permission and later claimed by adverse possession. We said; “The rule is that where the entry is permissive the statute will not begin to run against the legal owner until an adverse holding is declared, and notice of such change is brought to the knowledge of the owner." In the case at bar it appears undisputed that appellants’ claim of ownership was not brought home to appellees until 1970.

Affirmed.


author: John A. Fogleman, Justice.

text:
    Isaiah Bennie HENDRIX et ux v. Sam HENDRIX et al
    73-234
    506 S.W. 2d 848
    Opinion delivered March 25, 1974

      F. C. Crow, for appellants.

      Graves & Graves, for appellees.
   John A. Fogleman, Justice.

This is an appeal from a chancery court decree ordering eighty acres of land in Clark County sold and the proceeds allocated among the owners according to their respective interests. We will not set aside the findings of the chancellor unless they are against the preponderance of the evidence, and it is incumbent upon appellants to establish that the findings of the trial court were erroneous. City of Little Rock v. Sunray DX Oil Company, 244 Ark. 528, 425 S.W. 2d 722; Holt v. Holt, 253 Ark. 456, 486 S.W. 2d 688. We have considered all of appellants’ allegations and find that they have failed to meet the burden of showing error.

All of the parties to this action are the direct descendants, or spouses of descendants, of James Hendrix who died intestate in 1944 seized of the land in question. Appellant Isaiah Bennie (or I. B.) Hendrix is a grandson of James Hendrix. Katie Hendrix is I. B.’s wife and Pauline Buford is his niece. Appellees are allegedly all the remaining heirs (and their spouses) or spouses of deceased heirs who claim an interest in the property.

In 1962, appellant I. B. Hendrix was informed that the family property had been sold in a tax sale in 1949. After talking with appellee Sam Hendrix, the oldest son of James Hendrix and the person who, the family assumed, was responsible for the property, I. B. went to the courthouse and ascertained that the property was shown on the tax books as belonging to Bill McMillan. Sam and I.B. Hendrix consulted several attorneys about the possibility of recovering the property. I. B. Hendrix then obtained the signatures of other heirs on a sheet of paper which was captioned, “we the Undersigned agree for I. B. Hendrix to redeem the Hendrix land at Bertrell, Arkansas.” Deeds of conveyance made out to I. B. Hendrix were then sent by I. B. to these heirs. Eight of them signed the deeds, but the remainder, including Sam Hendrix, refused to sign.

I. B. Hendrix then filed suit to set aside the 1949 tax sale to J. E. Shaw and the subsequent deed from Shaw and his wife to the McMillan defendants and to quiet title in himself, naming as additional defendants all the Hendrix heirs who had not deeded their interests to him. Sam Hendrix and his wife filed an answer, and at trial his brother Crawford was allowed to answer orally for himself and for his wife end four nieces. No other Hendrix defendant filed an answer. The Shaw and McMillan defendants filed answers.

The case was heard before the Chancery Court of Clark County on June 25, 1968, and, on August 1, the chancellor issued a decree which set aside the tax sale, ordered the subsequent deed from the Shaws to the McMillans removed as a cloud on the title of the Hendrix heirs, declared the McMillan defendants to be entitled to $531.51 for taxes they had paid and ruled I. B. Hendrix was entitled to no affirmative relief against the other heirs. The decree specifically reserved to the other heirs the right to seek a partition of the property.

In September of 1971, suit was filed against I. B. Hendrix, his wife Katie and Pauline Buford, who had deeded her interest to I.B., by the remaining heirs, including seven of those who had previously deeded their interest to I.B.

Pauline Buford filed an answer in which she disclaimed any interest in the property due to her deed to I. B. Hendrix. I. B. and Katie Hendrix filed an answer in which the following material allegations were made: the seven plaintiffs who had deeded their interests to I. B. were estopped to maintain this action; those of the heirs who had signed the “agreement” were estopped and barred by laches; all those parties who did not File an answer in the first suit had defaulted and abandoned their interest in the property; if partition should be ordered, defendants were entitled to reimbursement for expenditures incurred incident to the property.

The case was tried on November 6, 1972, and on April 12, 1973, the chancellor issued a decree ordering a partition sale, finding I. B. Hendrix to be the owner of 19/144 of the land by virtue of inheritance and the eight deeds to him, setting out the proportionate interests of the other heirs and ordering payment of $531.51 to A1 Graves, who had been the attorney for the Hendrix defendants in the quiet title action, to reimburse him for advancing the funds paid to the McMillan defendants pursuant to the judgment in that case.

Appellants assert a number of grounds for reversal. They allege first that the decision of the chancellor was against the law and the evidence and that the court erred in holding that plaintiffs had not abandoned their interest in the land. The two bases for these contentions are the failure of certain of the heirs to answer in the first suit and the existence of the “agreement,” signed by other heirs, for I. B. Hendrix to redeem the property. This court has applied the following definition of abandonment to determine if realty has been abandoned:

To relinquish or give, up with the intent of never again resuming or claiming one’s rights or interests in; to give up absolutely; to foresake entirely; to renounce utterly; to relinquish all connection with or concern in; . . .

Hyde, Ex’rs v. Hyde, 240 Ark. 465, 400 S.W. 2d 288. Title to realty may not be divested by abandonment alone. There must be an intent on the part of the owner to relinquish his claim, and this intent must be accompanied by circumstances of estoppel and limitation if the abandonment is not by a legal deed of conveyance. Helms v. Vaughn, 250 Ark. 828, 467 S.W. 2d 399.

The uncontroverted testimony established that all the heirs considered Sam Hendrix as the one responsible for the family property. Even appellants in their brief refer to Sam as the “self-styled administrator.” Sam testified at the trial of the partition suit that, prior to the hearing in the action to quiet title, he contacted the other heirs and all wished him to represent their interests in the matter. We have long held that between tenants-in-common there is a fiduciary relationship, for they stand by operation of law in a confidential relation to each other, as to the joint property, and the duty is imposed on them to protect and secure their common interest. Chism v. Thomas, 144 Ark. 45, 221 S.W. 458; Clements v. Cates, 49 Ark. 242, 4 S.W. 776. Thus, by agreement of the other heirs and the duty imposed on him by virtue of his cotenant relationship, Sam Hendrix was representing his own interest and the interest of the heirs who failed to answer in the trial of the quiet title aetion. There was no evidence, other than the failure of these heirs to answer in that action, to indicate that they intended thereby to abandon the property.

At the trial in the partition suit, I. B. Hendrix testified he was told by one of the attorneys he consulted that since the property had been lost for so long a time, one who redeemed it would be the owner, and the attorney suggested to him that he obtain the signatures of all the other heirs acquiescing in this arrangement. I. B. went on to say the heirs understood that if he were able to recover the property it would belong to him individually. This was contradicted by the testimony of Sam Hendrix, who said he agreed only to I. B. redeeming the land for the benefit of all the heirs, and said he would not have otherwise acquiesced since he had promised his mother and father he -would see that everyone got his share of the property. We should point out that after the heirs had signed the “agreement,” only eight were willing to deed their interest to I. B. From this, the inference that these nondeeding heirs did not understand the “agreement” as operating to divest them of their interest in the property was certainly a permissible one.

It is very widely held that one asserting abandonment of property, especially real property, bears the burden of proving it by clear, unequivocal and decisive evidence. Shew v. Coon Bay Loafers, Inc., 76 Wash. 2d 40, 455 P. 2d 359 (1969); Cameron v. Lebow, 366 S.W. 2d 164 (Ky. 1963); McLellan v. McFadden, 114 Me. 242, 95 A. 1025 (1915); Hoff v. Girdler Corporation, 104 Col. 56, 88 P. 2d 100 (1939); Friedman v. United States, 347 F. 2d 697 (8th Cir. 1965), cert. denied, 382 U.S. 946, 86 S. Ct. 407, 15 L. Ed. 2d 354 (1965); McCartney v. McKendrick, 226 Miss. 562, 85 So. 2d 164 (1956); 1 Am. Jur. 2d 31, Abandoned, Lost, etc. Property, § 38. We cannot say the chancellor’s finding, on the evidence presented, that an abandonment had not occurred was clearly against the preponderance of the evidence.

Appellants also contend the court erred in failing to find that appellees had made a gift of the land to appellants and in not granting judgment to appellants for all sums expended to recover, improve and maintain the land. Appellants argue that there was a valid parol gift of the property or, in the alternative, that the “agreement” signed by the heirs was a sufficient memorandum to establish a written conveyance of the property.

The “agreement” does not provide adequate evidentiary support for appellants’ contention that a written gift of the land had been made to appellants. Even if the description of the property in the “agreement” were found to be adequate, and we do not indicate that it was, we cannot say that the language of the document shows the donative intent of the signers clearly and convincingly, which would be necessary to establish a gift. Mohr v. Hampton, 238 Ark. 393, 382 S.W. 2d 6; Baugh v. Howze, 211 Ark. 222, 199 S.W. 2d 940.

Appellants also contend that there was a parol gift of the land to I. B. Hendrix. A parol gift of land must be shown by clear, unequivocal and convincing evidence especially when the transaction involves members of the same family. Chambers v. Chambers, 220 Ark. 51, 246 S.W. 2d 124; Akins v. Heiden, 177 Ark. 392, 7 S.W. 2d 15, Meigs v. Morris, 63 Ark. 100, 37 S.W. 302. The evidence supporting appellant’s contention that a gift was made consisted principally of I. B. Hendrix’s testimony that all the heirs agreed he could have the property if he were able to recover it, the “agreement” signed by the various heirs and the fact that appellants had expended money to improve the property. However, this testimony was directly contradicted by Sam Hendrix who said he would never have agreed to such an arrangement. The document relied upon is ambiguous and, as noted earlier, it is significant that only eight of the heirs later signed the deeds which I. B. sent to them granting their interest in the property to him.

Furthermore, an oral gift of land is not enforceable unless there is actual possession, followed by making of valuable improvements. Brown v. Bennett, 226 Ark. 872, 294 S.W. 2d 492; Akins v. Heiden, supra. The expenditures made by the donee in reliance upon the gift supply consideration, and the possession and betterment constitute such part performance as to take the case out of the statute of frauds. Hunt v. Boyce, 176 Ark. 303, 3 S.W. 2d 342; Akins v. Heiden, supra. The fact that the improvements were made in reliance upon the gilt must be directly and unequivocally proved; mere proof that the donee received possession of the land, and has made improvements upon it, will raise no presumption of his purpose. Young v. Crawford, 82 Ark. 33, 100 S.W. 87. If the improvements made by the party can reasonably be accounted for in some other way than by a contract between the parties, then such possession and improvements will ordinarily not avail as a part performance. Meigs v. Morris, supra.

On cross-examination, I. B. Hendrix testified he did not think he owned the land prior to the quiet title suit, and that as a result of correspondence with his attorney following that suit he believed he had been awarded the land. The improvements to the property, consisting primarily of the digging of a stock pond and fencing the land, were made after the decree in the first suit. Thus, it is just as reasonable to attribute the improvements to I. B.’s mistaken belief that he had acquired title through the suit to quiet title as it is to attribute them to his belief that a gift had been made to him.

In his memorandum opinion denying reimbursement to I. B. Hendrix, the chancellor found that the improvements were made by Hendrix for his own benefit after he concluded he owned the land, that he derived benefits from the improvements and that there was no evidence showing that the improvements increased the value of the property by any particular amount.

From the testimony of I. B. Hendrix himself and the lack of any other evidence in the record to support the claim for reimbursement, we cannot say the chancellor erred in ruling that no gift had been made to I. B. and that he was not entitled to reimbursement for the expenses attributable to the improvement to the property. It should be noted that the memorandum opinion did provide that I. B. Hendrix would receive reimbursement for county and school taxes paid by him on the property from 1968 — 1972 and for certain other expenses resulting from the quiet title litigation.

Appellants further contend the chancellor erred in refusing to apply the doctrines of estoppel, due to unclean hands, and laches. Estoppel can arise by actions of a party, or his failure to speak or act, but it does not exist unless the adverse party has in good faith relied upon the acts, inaction or silence. Bowlin v. Keifer, 246 Ark. 693, 440 S.W. 2d 232. Laches is unnecessary delay coupled "with some unusual change that occurs in the conditions dealt with and the relationship of the parties. Sanders v. Flenniken, 180 Ark. 303, 21 S.W. 2d 847; Williams v. Grayson, 224 Ark. 207, 273 S.W. 2d 844. In order to apply laches it must not only be shown that there was an unreasonable delay, but that by reason of this delay some change has occurred which makes it inequitable to enforce the-claim. Stricklin v. Mitchell, 234 Ark. 31, 350 S.W. 2d 319. In view of the conflicting testimony noted previously, í. B. Hendrix’s admission that he believed he gained ownership of the property pursuant to the judgment in die quiet title action and the fact that the improvements to he property were made after the date of the decree in the first u* appellants have failed to prove reliance on any action or inaction of appellees or to show that any expenditures to improve the property were incurred by reason of the delay of appellees in bringing this action. Furthermore, courts should apply laches, where one member of a family would be deprived of property because he failed to promptly bring suit -t another, with extreme leniency. See Chambers v. i.v, 220 Ark. 51, 246 S.W. 2d 124; Boehnke v. Roenfanz, 24 Iowa 240, 67 N.W. 2d 585, 54 A.L.R. 2d 1 (1954); Berniker v. Berniker, 30 Cal. 2d 439, 182 P. 2d 557 (1947); Horton v. Horton, 63 App. D.C. 375, 72 F. 2d 831 (1934). We cannot say the chancellor erred in refusing to apply estoppel or laches.

"''he assertion that the trial court erred in not holding thas appellees had perpetrated fraud on appellants cannot be considered since appellants failed to raise it at the trial level. i‘ac;,cf v. Baker, 254 Ark. 283, 492 S.W. 2d 891; Travelers Insurance Co. v. McCluskey, 252 Ark. 1045, 483 S.W. 2d 179.

Since we cannot say that the chancellor’s findings are against the preponderance of the evidence, we affirm the decree.

Byrd. J., concurs.


text:
    Barbara Railsback FRENCH v. STATE of Arkansas
    CR 73-154
    506 S.W. 2d 820
    Opinion delivered March 25, 1974

      Ball, Gallman & Martin, for appellant.

      Jim Guy Tucker, Atty. Gen., by: O. H. Hargraves, Dep. Att.y. Gen., for appellee.
   John A. Fogleman, Justice.

We find it necessary to reverse the judgment of conviction of appellant of the crime of Possession of a Controlled Substance with Intent to Deliver in violation of Act 67 of 1972 [Ark. Stat. Ann. § 82-2617 (Supp. 1973)] because of the giving of an instruction to the jury which amounted to a comment on the evidence prohibited by Art. 7, Sec. 23 of the Constitution of Arkansas. The instruction was virtually a verbatim recitation of Act 68 of 1972 (Ark. Stat. Ann. § 82-2617). It read:

Possession of marijuana (Cannabis Sativa L.) in excess of one ounce shall create a rebuttable presumption that such person possesses such controlled substance with intent to deliver; provided, however, the presumption provided for herein may be overcome by the submission of evidence sufficient to create reasonable doubt that the person charged possessed the marijuana (Cannabis Sativa L.) with intent to deliver.

We have not heretofore passed upon the propriety of stating the statutory “rebuttable presumption” to the jury. We did not directly consider the question in Stone v. State, 254 Ark. 1011, 498 S.W. 2d 634, because it was not before us. We did hold, however, that the words “rebuttable presumption” as used in the statute referred, rather than to a conclusive presumption, to a justifiable inference, i.e., an inference which a trier of fact may draw if it thinks the evidence requires it, but which may be overcome by submission of evidence creating a reasonable doubt. Even though we reserved the question, we recognized that an instruction in the words of the statute might run afoul of such decisions as Lott v. State, 223 Ark. 841, 268 S.W. 2d 891, in which we have held an instruction telling a jury that an inference of guilt of larceny could be based upon an accused's possession of recently stolen property to be an impermissible comment on the evidence. To the same effect, see Mays v. State, 163 Ark. 232, 259 S.W. 398; Holcomb v. State, 217 Ark. 407, 230 S.W. 2d 487.

More to the point, however, is our holding in Reno and Stark v. State, 241 Ark. 127, 406 S.W. 2d 372, reaffirmed in State v. Jacks, 243 Ark. 77, 418 S.W. 2d 622, where, as here, the matter of drawing inferences as to a defendant’s intent from proof of other facts was the question involved. In Reno, there was a prosecution for failure of a contractor to apply payments made by an owner under his contract to the discharge of liens with the intent to defraud the owner under Ark. Stat. Ann. § 51-640 (Repl. 1971). An instruction was given which was a recitation to the jury of that section of the statute making the showing that a contractor had received payment without having discharged a mechanic’s, laborer’s or materialman’s lien within 10 days after receipt of payment or of notice of the existence of the lien prima facie evidence of intent to defraud, ft was held improper as a comment on the evidence.

The rationale of our holdings in regard to such matters is that it is improper for a court to tell a jury that a specific fact shown by the evidence is sufficient to support a certain inference, such as guilt, negligence, malice or the like. See Thiel v. Dove, 229 Ark. 601, 317 S.W. 2d 121. Under this rationale we must hold the giving of the instruction questioned here to be reversible error. In so doing, we reject appellee’s argument based upon a statement in Jones v. City of Forrest City, 239 Ark. 211, 388 S.W. 2d 386 (and cases cited therein), that an instruction in the language of a statute applicable to the facts of a case is always proper. This comprehensive language applied literally would permit the legislature to override Art. 7, Sec. 23 of the Constitution, but we have held in Reno, decided subsequently to Jones, that this cannot be. We hasten to point out that this case was tried prior to our decision in Stone v. State, supra, and to add that the instruction given here was not couched in language that would bring it within the category of instructions held permissible in such cases as Petty v. State, 245 Ark. 808, 434 S.W. 2d 602; Johnson v. State, 190 Ark. 979, 82 S.W. 2d 521; Thiel v. Dove, supra; McDonald v. State, 165 Ark. 411, 264 S.W. 961; Barron v. State, 155 Ark. 80, 244 S.W. 331; Selman v. State, 159 Ark. 131, 251 S.W. 882; Walker v. State, 138 Ark. 517, 212 S.W. 319.

Appellant next contends that the trial court erred in admitting into evidence articles seized pursuant to a search warrant issued by the Fayetteville Municipal Court. In support of, this contention, she argues that the information upon which Michael E. Vowell, Special Agent of the Bureau of Narcotics and Dangerous Drugs predicated his affidavit of probable cause for the issuance of the search warrant was obtained as a result of an illegal search by Vowell and that all conduct by Vowell thereafter was tainted by such illegal search.

On motion to suppress the evidence obtained through the search, it was shown that in.July 1972 a parcel addressed to Mr. Barbara Railsback was received via Delta Airlines at Little Rock. Its point of origin was somewhere in Africa. It was delivered to the Port Director, Arthur Vlcek, and left in his custody on the dock for five days, as customary in case of any importation into this country. Since it was not claimed by anyone during that period, it was then put into the Government Order Warehouse, which was in the back part of the Port Director’s office. About the 16th day of August, in order to clear the parcel through customs, Gregory Phillips of R. W. Smith Company, a broker, made an entry or declaration, on behalf of appellant, that the parcel contained a drum classified under a tariff act. Vlcek then opened the outer burlap wrapping of the parcel to see if the contents conformed with the entry. He found a drum, which seemed tb him to be heavier than normal. Because of the weight, he suspected that the drum might have been utilized for smuggling, so he punctured the drum, inserted a small wire probe and extracted a small piece of plastic bag and some material which proved upon testing to be marijuana. He immediately seized the drum and made up the usual seizure report based upon the smuggling of marijuana in violation of federal law prohibiting introduction of contraband into the United States. Although the customs agent usually makes delivery of contraband under these circumstances, Vlcek was directed by his superiors to deliver the drum to the Bureau of Narcotics and Dangerous Drugs, because of a shortage of personnel in the customs agency. Vlcek notified the Bureau of Narcotics, and officers Redd and Vowell of that agency appeared on the day after the parcel had been opened, and Vlcek turned the drum over to them, taking their receipt. It had been repacked in its original wrapper. Vlcek informed Redd and Vowell of his determination that the African drum inside the wrapping contained marijuana.

Vowell took the drum and made preparations to deliver it to the addressee. Until delivered on August 19, the drum remained in Vowell’s exclusive control and custody. There is a contradiction between the testimony of Vlcek and that of Vowell as to whether Vowell made an inspection and search of the drum before leaving Vlcek’s office. This is immaterial in our view of the case. Vowell did deliver the parcel to appellant Mrs. Barbara French at her residence on Markham Hill in Fayetteville, and obtained a receipt which she signed as “Barbara Railsback.” He did not identify himself as an officer. He made the delivery at a point about 40 feet from the front door of the French house. When he last saw appellant, she was walking toward the house carrying the drum.

Vowell then returned to the Fayetteville Police Department, where he had stopped on his way to the French residence, and made an affidavit he had previously prepared in order to obtain the search warrant. The affidavit was executed before Municipal Judge Richard A. Wells, who issued the warrant in question. The Warrant authorized the search of the French dwelling house and five outbuildings on the grounds. The affidavit recites the following facts as grounds for issuance of the warrant:

I was informed last date by Port Inspector Arthur Vlcek, Little Rock, Arkansas, that he had discovered, in a routine customs inspection, that a certain drum contained marijuana. He stated that his department had verified that this drum was shipped from Africa to London, England, to New York City, to Little Rock, Arkansas and destined for the here-and-above residence. Upon receiving this information, I personally checked this drum and was able to detect marijuana, which I verified by chemical test. This drum also appeared to contain other substances. This drum was addressed to one Barbara Railsback at Box 1872, U of A, Fayetteville, Arkansas 72701. The addressee contacted customs brokers and instructed delivery of said drum to be made to the above listed premises. This date, I accompanied delivery service on delivery of said drum to the above described premises within the last hour.

As heretofore pointed out, appellant’s argument is based almost entirely upon an assertion that the search made by Vowell upon his receipt of the drum was illegal, upon the theory that this tainted every step Vowell took thereafter. We do not agree. The question is whether the affidavit stated probable cause for the issuance of the search warrant. We do not consider the question of reasonableness of Vowell’s inspection of the drum and testing of its contents, because we find that immaterial. Appellant concedes that the search by Vlcek was legal and that Vowell had probable cause to obtain a warrant to search the drum upon the basis of the information obtained from Vlcek. Vowell testified that the information given him by Vlcek was one of the bases of his opinion that there was probable cause for the search. But appellant contends that there is no showing of the reliability of credibility of his hearsay information in Vowell’s affidavit. The affidavit identified Vowell’s informant as the Port inspector in Little Rock and that the information imparted by him to Vowell was discovered in a routine customs inspection. We do not deem it necessary for an affiant applying for a search warrant to state reasons why a public official is a credible or reliable informant.

We have long held that a presumption in favor of due performance of official duty always exists. Craig v. Sims, 160 Ark. 269, 255 S.W. 1. In the absence of evidence to the contrary, we have presumed that public officers have acted, or will act, lawfully, correctly, regularly, sincerely and in good faith in the execution of their duties. Arkansas Pollution Control Commission v. Coyne, 252 Ark. 792, 481 S.W. 2d 322; Rockefeller v. Hogue, 244 Ark. 1029, 429 S.W. 2d 85; Beaumont v. Faubus, 239 Ark. 801, 394 S.W. 2d 478. We have assumed that official negotiations were characterized by the utmost good faith and sincerity of purpose. Matthews v. Bailey, 198 Ark. 703, 130 S.W. 2d 1006. We have said that one should not be required to inquire into the honesty and good faith of a public officer. Dozier v. Ragsdale, 186 Ark. 654, 55 S. W. 2d 779. It would certainly be anomalous and inconsistent to honor the presumption as we have without .also indulging the presumption that a public official is credible and his information reliable when it was obtained in the performance of his official duties. In the absence of any effort to show that Vlcek was not a credible person and that he was not a reliable source of information, we hold that the municipal judge, the circuit judge and this court should indulge the presumption that he was. Consequently, appellant’s arguments here on this point must be rejected.

Discussion of appellant’s third point becomes moot, in view of the disposition we make of this case. By it, appellant asserts that the trial court erred in failing to require the state to submit to her the procedures used in chemical tests of materials seized. Inasmuch as the chemist who made the tests testified about them in detail, appellant, on retrial, has the benefit of more information than she would have obtained if her motion in that regard had been granted.

On account of the error in the instruction given, the judgment is reversed and the cause remanded for a new trial.


author: J. Fred Jones, Justice.

text:
    Carol McLaughlin MOORMAN v. Tommie C. CHISLER
    73-274
    506 S.W. 2d 840
    Opinion delivered March 25, 1974

      Murphy, Carlisle & Taylor, for appellant.

      Carl M. Harness, for appellee.
   J. Fred Jones, Justice.

This is an appeal by Carol McLaughlin Moorman from a chancery court order dismissing her petition on the ground that a prior decree pertaining to the ownership and possession of land was res judicata to her subsequent petition for the removal of buildings from the land.

On August 17, 1971, Carol McLaughlin Moorman filed a petition in the Washington County Chancery Court against Tommie C. Chisler alleging that she, Moorman, was the owner of the land here involved that she and her predecessors in title had occupied and been in possession of the land for more than seven years, and that she derived her title “by an agreement entered into between plaintiff’s father and mother, Everett James McLaughlin and Jo McLaughlin, husband and wife, and defendant’s deceased husband, Joseph C. Chisler, more than seven (7) years ago.” Mrs. Moorman alleged that she obtained her water supply to the premises from a source on lands claimed and occupied by Chisler; that Chisler had cut off the water supply and was claiming some interest in the property involved. The petition then prayed that title to the described lands be quieted in her and that Chisler be enjoined from interfering with the water supply and for all proper relief.

Tommie C. Chisler filed an answer denying that Moor-man had any interest at all in the property either legal or equitable, and that Chisler should have a writ of possession against Moorman for the described premises and that the title thereto should be quieted in Chisler. Chisler also prayed for a writ of possession and that the title be quieted in her.

On February 21, 1972, at a trial on the merits, the chancellor entered a decree sustaining Chisler’s demurrer to the evidence offered by Moorman and dismissed Moorman’s petition. The chancellor’s decree concluded as follows:

“Title to the above premises is quieted and confirmed in the defendant, Tommie C. Chisler, and the plaintiff, Carol McLaughlin Moorman, and her privies are hereby ordered and directed to surrender the abo’ve described premises to the defendant, Tommie C. Chisler.”

Mo appeal war. raleen from this decree but on February 16, 1973, Firs. Moorman filed her petition in the Washington County Chancery Court against Tommie C. Chisler alleging that she was the plaintiff in the original suit and that Chisler was the defendant. She again alleged possession of the properly for more than seven years and alleged that Chisler was in possession of the property under the writ of possession issued in the previous case. Mrs. Moorman then alleged that she had previously entered into possession of the premises with the acquiescence, agreement and encouragement of Chisler and her deceased husband and, at the request of Mrs. Chisler, had constructed a house on the premises with the understanding that the house would be the property of Mrs. Moorman and her mother and father. She alleged that the house had been so constructed; that it is of the value of $10,-000; that Chisler was retaining possession of same under the prior order of the court for possession; that the house could be removed from the property without damage to the land, and Mrs. Moorman prayed for an order allowing her to remove the house and for an order restraining Chisler from interfering with such removal. In the alternative she prayed judgment against Chisler for the value of the improvements in the amount of SI0,000. In answer to the petition Chisler pleaded the defense of res judicata and subsequently filed a motion for summary judgment.

On July 13, 1973, the chancellor entered an order granting Chisler’s motion for summary judgment and dismissing Moorman’s petition on findings recited as follows:

“ . . . [T] he Judgment of this Court entered in case No. 22306 on April 26, 1972, concluded the rights and interests of the parties in and to the real property herein and the improvements thereon; that the said prior Judgment is res judicata as to the matters in issue as set forth in plaintiff’s complaint, and for reason thereof, defendant is entitled to judgment against plaintiff as a matter of law.”

On her appeal to this court Mrs. Moorman contends that the chancellor erred in ruling that the ownership of the improvements on real property was res judicata. We are of the opinion that the chancellor was correct.

The test on a plea of res judicata was clearly stated in the case of Robertson v. Evans, 180 Ark. 420, 21 S.W. 2d 610, wherein this court said:

“The test in determining a plea of res judicata is not alone whether matters presented in a subsequent suit were, litigated in a former suit between the same parties, but whether such matters were necessarily within the issues and might ha9e been litigated in the former suit. Gosnell Special School Dist. No. 6 v. Baggett, 172 Ark. 681; Cole Furniture Co. v. Jackson, 174 Ark. 527, 295 S.W. 970; Prewett v. Waterworks Imp. Dist. No. 1, 176 Ark. 1166, 5 S.W. 2d 735.”

See also Pulaski County v. Hill, 97 Ark. 450, 134 S.W. 973.

In Gaither v. Campbell, 94 Ark. 329, 126 S.W. 1061, this court said:

“It is clear that the decree declaring a lien against Mrs. Gaither’s interest in the lands was erroneous. The court had, at a previous term, rendered a decree quieting her title, and nothing was said therein about the value of the improvements. That decree was not appealed from, and became final with the expiration of the term. Thereafter, the court had no power to alter it, and it was a complete adjudication of all the issues presented by the pleadings. This of course included the claim for improvements. The betterment statute provides that the claim of an occupant for improvements shall be adjudicated in the same action in which the title is adjudicated ‘before the court rendering the judgment shall cause possession to be delivered to the successful party.’ Kirby’s Dig., § 2754 el seq ... . Of course, a trial court may at one term adjudicate the title and withhold possession, reserving for further investigation the question of improvements, etc., in which case the judgment would not be final. Hargus v. Hayes, 83 Ark. 186; Brown v. Norvell, 88 Ark. 590. But in the present case the decree in Mrs. Gaither’s favor was final, and left no issue undetermined. Nothing was reserved for further determination. Therefore, it could not be reopened later, so as to render a decree for improvements.”

We are of the opinion that the chancellor committed no error and that the order must be affirmed.

Affirmed.


author: Conley Byrd, Justice.

text:
    WILLIAM PENN FRATERNAL Association v. Darrel HICKMAN, Chancery Judge
    73-264
    506 S.W. 2d 823
    Opinion delivered March 25, 1974

      Rose, Nash, Williamson, Carroll & Clay, for petitioner.

      Pope, Pratt, Shamburger, Buffalo & Ross, by: Donald J. West, for respondent.
   Conley Byrd, Justice.

By this proceeding petitioner William Penn Fraternal Association, organized under the laws of Pennsylvania, seeks to prohibit the respondent, Chancellor Darrell Hickman, from taking personal jurisdiction over it in a case filed by Doyle Nabors and Herbert J. Gray and in which a cross-complaint was filed by Nationwide Underwriters, Inc. Against William Penn. The complaint of Nabors and Gray alleges that they, as residents of Kentucky, had entered into a contract with Nationwide Underwriters, Inc., an Arkansas corporation, wherein they were to act as associate general insurance agents and that Nationwide Underwriters had failed to account for certain commissions then due. Petitioner was brought into the action on the theory that it was a party to and had approved the contract. Nationwide in its cross-complaint against petitioner alleged that petitioner had failed to perform the general agent’s contract in certain instances with respect to persistency bonuses, first year commissions and renewal commissions allegedly due and sought an accounting from, petitioner.

Nabors and Gray attempted to obtain service of process upon petitioner pursuant to the Uniform Interstate and International Procedure Act. Ark. Stat. Ann. § 27-2502(c) (Supp. 1973). Nationwide also attempted to obtain personal service upon petitioner under the Unauthorized Insurers Process Act. Ark. Stat. Ann. § 66-2905 (Repl. 1966). Upon a motion by petitioner to quash summons and a response thereto respondent held a hearing at which testimony was given. Upon the evidence presented respondent overruled the motion to quash.

Petitioner here relies upon Hanson v. Denckla, 357 U.S. 235, 78 S. Ct. 1228, 2 L. Ed. 2d 1283, contending that it did not have sufficient minimum contacts in Arkansas to support personal jurisdiction. Respondent on the other hand contends that the record shows sufficient contacts to satisfy the minimum requirements of due process. We do not reach the merits of the different contentions in this proceeding for we have consistently held that where the jurisdiction of the trial court depends upon a factual determination, a writ of prohibition will not lie. Coley v. Amsler, 226 Ark. 492, 290 S.W. 2d 840 (1956).

In Robinson v. Means, Judge, 192 Ark. 816, 95 S.W. 2d 98 (1936), Robinson contended that the service of process should be quashed because it was obtained by trick. In denying a writ of prohibition we said:

“. . . Where the court has jurisdiction over the subject-matter, and the question of its jurisdiction of the person turns upon some fact to be determined by the court, its decision that it has jurisdiction, if wrong, is an error, and prohibition is not the proper remedy. . . .”

When the issue of service of process by trick was reached on its merits on appeal in Robinson v. Bossinger, 195 Ark. 445, 112 S.W. 2d 637 (1938), we reversed the trial court’s refusal to quash the service.

Since the trial court’s determination of jurisdiction was a factual issue under both the Uniform Interstate and International Procedure Act and the Unauthorized Insurers Process Act, it follows that the petition for writ of prohibition should be denied.

Writ denied.

Harris, C.J., dissents.