text:
    Gertrude E. McCormick v. Robert Earl McCormick
    5-4814
    438 S.W. 2d 23
    Opinion Delivered March 10, 1969

      Cockrill, Laser, McGehee, Sharp & Bosivell for appellant.

      Butter & Dishongh for appellee.
   Frank Holt, Justice.

This appeal is from the refusal of the chancellor to vacate and set aside a decree of divorce which was granted to appellee by default.

Appellant alleged in her motion to vacate the decree that she was prohibited by unavoidable circumstances from appearing and defending, and, further, that she had a meritorious defense to the complaint. We find no merit in either contention.

Appellant and appellee were married in 1958 and were separated in 1963. On January 18, 1968, the appellee filed suit for divorce against the appellant, alleging, inter alia, the statutory ground of three-year separation. On that date an attorney ad litem was appointed to notify appellant, a nonresident, and the requisite warning order was issued. The attorney ad litem notified her by certified mail of the pendency of the lawsuit. He enclosed a copy of the complaint; advised her she had thirty days to defend the action to avoid a default judgment; that she should engage an attorney immediately, and that he could not represent her. He received a return receipt, dated February 5, 1968, from appellant. Next, he received from her a letter dated February 19, 1968, wherein she acknowledged receipt of the notice, stated that she was seeking legal advice and desired some additional time to get “necessary information and advice” and after that, she would decide what she should do. The attorney ad litem included the return receipt and her letter in Ms reports to the court. Nothing further was heard from her and on February 29 the chancery court granted appellee a divorce based moon three-years separation. On March 26, 1968, appellant filed her motion to vacate this decree. Upon a hearing, she testified that she had sought advice from an attorney in the state of Washington, where she lives, and that he had furnished her the name of a local Arkansas attorney with whom she communicated; that he advised he was unable to represent her and furnished two other names. She wrote to one of them who replied that he could not represent her and, further, that a divorce had already been granted. Subsequently her present counsel filed this motion to vacate the divorce decree.

It is within the discretion of the trial court to set aside a default judgment upon the showing of excusable neglect, unavoidable casualty, or other just cause which prevents a party from appearing or defending. Ark. Stat. Ann. § 29-401 (Repl. 1962). Appellant relied upon this statute and argues that the evidence in this case brings her within its provisions. We cannot agree.

Appellee complied with all the requirements of outlaws in securing his divorce. Appellant had 24 days notice before rendition of the final decree. During this time she actually consulted and communicated with legal counsel. She made no appearance and no pleading was filed in the case until almost one month after the decree was rendered. Where one has notice of the pendency of an action for divorce and fails to appear and defend, a motion to vacate the decree will be denied where there is negligence or a lack of diligence shown. Gaines v. Gaines, 187 Ark. 935, 63 S.W. 2d 333 (1933); Hagen v. Hagen, 207 Ark. 1007, 183 S.W. 2d 785 (1944); Sariego v. Sariego, 231 Ark. 35, 328 S.W. 2d 136 (1959). In Gaines we upheld the refusal of the trial court to vacate the decree where the appellant had only 7 days’ notice of the pendency of the action. In Hagen, the wife, upon receiving notice to defend a divorce action against her, replied that she desired to defend. However, during the 23-day interim she took no further action. The chancellor granted her motion to vacate the decree. Iu reversing, we held that she had, ample notice of the pendency of the action and was negligent in not defending it. In the case at bar, appellant had sufficient notice and ample time to appear and defend the action and her failure to do so was negligence and a lack of legal diligence.

Furthermore, at the hearing of her motion to vacate appellant agreed and it was stipulated that she and appellee had lived separate and apart for more than three consecutive years. A divorce under this section [§ 34-1202 (7) (Repl. 1962)], upon proper proof, is mandatory upon the suit of either party, regardless of what caused the separation or who was at fault. Brooks v. Brooks, 201 Ark. 14, 143 S.W. 2d 1098 (1940); Mohr v. Mohr, 214 Ark. 607, 215 S.W. 2d 1020 (1948).

However, when a. divorce is granted upon threevears separation, the question who is the injured spouse is then considered in the settlement of property rights and the question of alimony. Jones v. Jones, 199 Ark. 1000, 137 S.W. 2d 238 (1940). Therefore, appellant argues that even though the divorce is valid, she has a meritorious defense as an injured party and is entitled to a hearing on the question of property rights, alimony and attorney’s fees. Appellant, who became a naturalized citizen in 1957, is 51 years of age, in good health and is gainfully employed as a registered nurse with an income of approximately $6,000 per year. Appellee is a non-commissioned officer in the military service. There are no children.

In 1963, following their separation, a comprehensive and detailed written property settlement was drafted by legal counsel and signed by appellant and appellee. This occurred while they were stationed in Germany, her native country, on military duty. The settlement recites that she speaks English fluently and has no difficulty in reading and understanding the English language. Further, that she was completely advised, “from the attorney of mv own selection.” During the next four years, appellee performed his agreed obligations which were completely fulfilled in 1967. Appellant accepted all the benefits. Now it is asserted that it was improper to consider and insert this instrument into the default decree. However, it is expressly agreed in this written instrument that “the terms of this agreement will be entered as part of any decree entered” in a divorce proceeding. Even if we should exclude the property settlement, which appears to meet the test of fairness and reasonableness, we are of the view that appellant is not an injured spouse in this action. Certainly, we cannot say there was an abuse of discretion by the chancellor in refusing to vacate and set aside the default decree of divorce in the case at bar.

Affirmed.

Byrd, J., not participating.


source: Caselaw Access Project

author: Carretón Harris, Chief Justice.

license: Public Domain

text:
    Edward Page v. Boyd-Bilt, Inc.
    5-4790
    438 S.W. 2d 307
    Opinion Delivered March 17, 1969

      Leon Burrow and Oscar Fendlcr for appellant.

      Erereit E. Harbor for appellee.
   Carretón Harris, Chief Justice.

Edward Page, appellant herein, employee of Phillips Construction Company, was allegedly injured on March 26, 1966, when he stepped upon a roofing nail while working on a construction job. The general contractor in charge of constructing a building for Ark-Mo Power Company in Blytheville, was Phillips Construction Company. Boyd-Bilt, Inc.., appellee herein, had no connection with Phillips, but, according to a complaint filed by Page against this company, appellee had allegedly purchased a dwelling located on the work site, and had agreed to move the dwelling and clear the site in order for Phillips to proceed with construction of the office building. The complaint asserted that, in tearing down the garage next to the dwelling, agents, servants, and employees of appellee had been negligent in allowing nails and other dangerous objects to be spread and scattered about the premises upon which Page was working, in disregard for the safety of other persons rightfully working upon said premises; that appellee was further negligent in failing to clean up or “police” the area in which Phillips employees were working. Personal injuries were alleged as a direct result of appellee’s negligence, and damages were sought in the amount of $50,000.00. An answer was filed by Boyd-Bilt, Inc., admitting that it was a corporation, but denying all other allegations as to negligence, injury, and damages. The answer was subsequently amended to assert that, if plaintiff received an injury, it was caused by someone other than appellee; that Page assumed the risk of his injury, knowing the situation, and realizing that he could be injured. On trial, at the conclusion of appellant’s testimony, appellee moved for a directed verdict, which motion was granted. From the judgment accordingly entered, appellant brings this appeal. For reversal, it is simply asserted that the court erred in directing the verdict, since there was sufficient evidence offered by appellant to warrant submission of the case to the jury.

We first point out that, since we are dealing with a directed verdict, we must take that view of the evidence which is most favorable to the party against whom the verdict is directed, and, if there is any substantial evidence tending to establish an issue in his favor, it is error for the court to take the case from the jury. In testing where there is substantial evidence, the testimony and all reasonable inferences deducible therefrom must be viewed in the light most favorable to the party against whom the verdict is directed, and, if there is any conflict in the evidence, or where the evidence is not in dispute, but is in such state that fair-minded men might draw different conclusions therefrom, it is error to direct. a verdict. Huffman Wholesale Supply Company v. Terry, 240 Ark. 399, 399 S.W. 2d 658.

Page, 49 years of age, testified that he was a carpenter, and, at the time of the accident, was employed by Phillips Construction Company on the Ark-Mo job in Blytheville. Just prior to sustaining the injury, Page, with another employee, Mode Sickles, had gone to the Park Street side of the construction site to pick up some steel reinforcing rods. This was not a normal job for Page and Sickles, but other laborers were busy endeavoring to complete the digging of the basement before it rained. In returning, they used a different route, one they had not used before, because the shorter route was muddy. The job of carrying the rods required two men, with Page at the front and Sickles at the rear. They passed about 15 to 20 feet from where the garage bad been torn down. The area being traversed was grassy. Page suddenly stopped, telling Sickles not to follow him, as he (Page) had stepped on a nail in a roofing shingle. Other shingles were scattered about the premises. Page said that he had not been looking at the ground, while carrying the steel, because he knew that the area had been previously cleaned up by the Phillips workers, and he was not aware that the nails and shingles were on the ground. Page took off his boot and sock, and found one spot of blood. The nail, a four-penny shingle nail, was rusty at the end. He returned to work, but was unable to report to the job the next day, and was thereafter unable to resume his employment until June 8, 1966. Page testified relative to the seriousness of his injury, and treatment received therefor, but that question is not involved on this appeal. Appellant was wearing construction boots, the sole being % to % of an inch thick.

Sickles testified that he saw Page step on a shingle, pull his foot up, and that appellant then warned him, “Don’t come this way.” The witness said that he then looked over the area they were approaching, and saw shingles scattered all out in front of them. He said that Page stepped on the nail about 15 feet behind and to the rear of the location of the garage.

Tillman Dill, employed by Phillips Construction Company as superintendent, testified that Page was working for him on the Ark-Mo job. Dill said that he (Dill) had complained several times about the house and garage not being cleared from the property, and he did not remember exactly when the garage was torn down; he did know that it was still standing on February 15. The witness stated that the tearing down of the garage could have been a week or week and a half before Page was injured, and he testified that his men liad cleaned up the entire area to the edge of the house and garage prior to the tearing down process. The foreman said that Page reported to him that he had stepped on a nail, and that appellant was wearing the type boots used in construction work at the time.

Tt is argued by appellee that there is no showing of negligence on the part of Boyd-Bilt — or that the shingles had been placed in that particular area by employees of Boyd-Bilt. It is mentioned that the spot where the alleged injury took place was about 20 feet from the garage, and it is also pointed out that there was no showing that the garage had been covered with wooden shingles.

We think appellee’s argument lacks merit. Appellant had filed certain requests for admissions, No. 4 which was admitted, being as follows:

“The defendant, in tearing down this garage, removed the roofing from the top of said building.”

The evidence, heretofore set out, reflects that all debris, occasioned by the moving of other buildings, had already been cleared away, which would mean that the shingles scattered over the ground near the garage were the same shingles that had composed the roof of the garage. This is certainly a logical inference; contrariwise, it would be most illogical to assume that some person carried the shingles to that location and strewed them over the ground. After all, 15 to 20 feet is not a great distance for shingles to fall when they are being removed from a roof and tossed to the ground. As far as the negligence of Boyd-Bilt is concerned, we think a jury question is made, relative to whether leaving exposed shingles with nails in them on premises where other people are working, constitutes negligence. Nor do we find merit in the argument relating to assumption of risk. Of course, this doctrine (which has been described as harsh) is generally applied in cases involving an employer-employee relationship, though there are some other situations that it can also apply to. Certainly, under the facts presently before the court, Page could not, as a matter of law, be held to assume the risk of a danger, that, according to his testimony, he knew nothing about. An essential element of the doctrine of assumption of risk is that the person injured had knowledge of, and appreciated, the danger incident to his undertaking. In E. L. Bruce Company v. Leake, 176 Ark. 705, 3 S.W. 2d 988, this court said:

“When a servant enters into the employment of anyone, he assumes the ordinary risks and hazards which are incident to the service and this includes all those defects and dangers which are obvious and patent. He assumes all the risks which he knows to exist and all those which are open and obvious. ’ ’

In Pona v. Boulevard Arena (N.J.), 113 A. 2d 529, the court said:

“It is well settled that a dismissal by the court on the ground of assumption of risk... may only be entered in the clearest case where a contrary hypothesis is not fairly admissible. * * * The elements ‘ must be of such a prominent and decisive character as to leave no room for a difference of opinion thereof by reasonable minds.’ * * * The facts must appear clearly and convincingly, or as the necessary and exclusive inferences to be drawn by all reasonable men in the exercise of a fair and impartial judgment; otherwise the question is for the jury.”

Prosser, Law of Torts, 3rd Ed. § 67, pp 453-54, citing the above case, states that assumption of risk is a jury question in all but the clearest cases. See also Haynes Drilling Corporation v. Smith, 200 Ark. 1098, 143 S.W. 2d 27, and cases cited therein.

We think it apparent that, under the state of this record it cannot be said that the facts show clearly and with no contrary hypothesis fairly admissible, that Page assumed the risk of stepping on shingles with nails when he helped carry the rods through the area.

Reversed and remanded.

      Other houses had been torn down or moved at an earlier time, and some of the Phillips workers had cleaned up remaining debris.

      For instance, in Bugh v. Webb, 231 Ark. 27, 328 S.W. 2d 379, Webb rode in an automobile driven by Bugh at a time when Bugh was engaged in an automobile race, commonly known as a “drag race.” During the “contest,” a pickup truck was struck by both Bugh’s car and the car engaged in the race with him, Webb receiving injuries. A jury awarded damages, but we reversed, holding that Webb, in getting into the automobile, knowing full well of the hazards of drag racing at night on a heavily traveled highway, assumed the risk of proceeding in the face of danger, and was thus barred from recovery.


author: George Rose Smith, Justice.

text:
    William Howard Mosley v. State of Arkansas
    5-5397
    438 S.W. 2d 311
    Opinion Delivered March 17, 1969

      Bill J. Davis for appellant.

      Joe PurceJl, Atty. Gen. and Don Langston, Asst. Ally. Gen. for appellant.
   George Rose Smith, Justice.

This appeal is from a verdict and judgment finding William Howard Mosley guilty of rape and fixing his punishment at life imprisonment. The appellant’s attorney, who was appointed by the court, argues three points for reversal.

Before the trial counsel filed a motion to suppress the defendant’s confession, on the grounds that he was not properly warned of his constitutional rights and that he was too young to comprehend such a warning. The trial judge held a hearing on the motion to suppress and found the confession to be admissible. In accordance with our practice as set forth in Harris v. Slate, 244 Ark. 314, 425 S.W. 2d 293 (1968), we have independently reviewed the record and have reached the conclusion that the confession was admissible.

The offense of rape was committed in August of 1966. In the following May young Mosley, who was wanted as an escapee from the Boys Industrial School, was arrested and questioned about a more recent offense involving burglary and assault. The two officers who questioned Mosley testified that they first explained his constitutional rights and obtained his signature to a printed form of waiver containing a full statement of those rights. Mosley quickly admitted his guilt of the offense under investigation and signed a confession with respect to it.

The officers then repeated their explanation of Mosley’s rights and obtained another signed waiver before questioning him about the older charge of rape. Mosley again admitted his guilt and signed a confession that agreed in all material details with the version later given by the prosecuting witness at the trial of the case. This is the confession that the trial judge found to have been voluntarily given.

AVe agree with that conclusion. Mosley testified at the hearing on the motion to suppress. He admitted that the officers read the waiver to him, but he testified that he did not understand it. He does not contend that he was physically mistreated, though he does say that one of the officers threatened to “bust” him when lie got out of the reform school.

Mosley was fifteen years old when he was interrogated. lie had served a term in the penitentiary and liad also been confined to the Boys Industrial School. The trial judge made detailed findings of fact, which included this statement based upon firsthand observation: “He appeared to me to be completely normal and possessing the intellect of an average sixteen-year-old boy.” Needless to say, officers who question an underage suspect should take his youthfulness into consideration in conducting their interrogation. In this case we do not find that young Mosley was abused or treated unfairly in any way. By the great weight of authority a minor is capable of making an admissible voluntary confession, there being' no requirement that he have the advice of a parent, guardian, or other adult. The cases are analyzed at length in People v. Lara, 62 Cal. Rptr. 586, 432 P. 2d 202 (1967), and need not be re-examined here.

Secondly, counsel contends that the State failed to make a prima facie case, because Mosley’s confession is the only evidence that connects him with the crime. That is all the law requires, it being sufficient for the other proof to show that the offense charged was committed by someone. Ark. Stat. Ann. § 43-2115 (Repl. 1964); Charles v. State, 198 Ark. 1154, 133 S.W. 2d 26 (1939). The testimony of the prosecutrix satisfied the statutory requirement.

Finally, counsel complains of two references during the trial to the subsequent incident involving burglary and assault. Both references occurred during the cross-examination of Officer Calhoun, a witness for the State. Calhoun was asked what happened just before Mosley confessed to the rape, and the witness answered: “I was questioning him about a house burglary where he assaulted a woman and broke in her house.” The answer could not have been unexpected, for the officer had given the same testimony at the earlier hearing upon the motion to suppress. Moreover, defense counsel continued his cross-examination without making any objection to the officer’s reply to the question.

A few moments later counsel returned to the point, asking Officer Calhoun if Mosley had signed another statement before signing the confession of rape. Calhoun answered: “Yes, sir. He signed one before this one admitting to assault of this other woman over there.” Counsel then made an objection and asked the court to admonish the jury, which was done. It was not until counsel had concluded his cross-examination that he asked for a mistrial, which he now insists should have been granted. The court properly refused to declare a mistrial, not only because that request manifestly came too late but also because counsel’s questions had elicited the information .in the first place. Doubtless counsel expected to derive some benefit for his client by showing that the youth had already been questioned for about 70 minutes before the officers began to interrogate him about the rape charge. Counsel cannot be permitted to obtain the advantage of that argument to the jury and still insist upon a mistrial when the strategy proved to be unavailing.

Affirmed.


author: Lyle Brown, Justice.

text:
    Floyd Bailey, Jr. v. State of Arkansas
    5-5400
    438 S.W. 2d 321
    Opinion Delivered March 17, 1969

      Harold L. Hall for appellant.

      Joe Purcell, Atty. Gen. and Don Langston, Asst. Atty. Gen. for appellant.
   Lyle Brown, Justice.

Floyd Bailey, Jr. was convicted of illegally possessing narcotics. Court-appointed counsel was relieved after the trial and appellant, Bailey, went to the penitentiary. The time ordinarily allowed for appeal expired; however, the trial court granted Bailey a belated appeal because he did not have the assistance of counsel to represent him and timely file the appeal. Bailey challenges the validity of a search of his apartment and of his person, both of which revealed the presence of marijuana. The pertinent facts will be related under our discus ¿ion of Bailey’s two points for reversal.

POINT I. The court erred in admitting evidence obtained by affidavit and search ivarrant issued upon insufficient facts and information in violation of the constitutional rights of the defendant. The two arguments under this point are (1) that the affidavit for search warrant was signed by Officers Terry and Gibson, who did not appear before the magistrate; and (2) that the affidavit provides only the unsupported conclusions of the affiants. In other words, appellant says the affidavit does not present the underlying facts or circumstances so that the examining magistrate could have made an independent determination as to the existence of probable cause. It is therefore argued that evidence obtained at defendant’s home was inadmissible.

With respect to the execution of the affidavit for search warrant, here is what the record reveals: Officers Terry and Gibson obtained from a source not disclosed a printed form used by the Municipal Court of Little Bock and titled “Affidavit for Search Warrant.” The body of the affidavit is as follows: “I, John Terry and W. D. Gibson, LBPD, do solemnly swear that illegal narcotics, marijuana, and drugs, are concealed in the premises occupied by Floyd “Spike” Bailey at 1003 High Street, Apt. 14, LB., in the State and County aforesaid, and pray a warrant from said court to search said premises.” The two officers signed the instrument. The jurat to the affidavit reads: “Sworn to and subscribed before this 27 day of May, 1966. ________________, Clerk.” The jurat is not executed by any official. The Clerk of the Municipal Court, Criminal Division, testified that he took no part in the execution of the affidavit.

We examine the search warrant issued on the basis of the proposed affidavit. The warrant recites that “complaint has been made, on oath, before the clerk or judge of the Municipal Court of Little Bock, by John Terry and W. D. Gibson, LBPD, that certain illegal narcotics, marijuana, and drugs are concealed on the premises occupied by Floyd “Spike” Bailey at 1003 High Street, Little Bock, and whereas, being satisfied that there is reasonable ground for such suspicion, you are therefore hereby commanded to search the said place above mentioned...” It will be noted that the search warrant issued by Judge Sullivan stated that it was issued on information supplied by Officers Terry and Gibson. It was undisputed that these officers did not appear before the magistrate. Officer Baer said he obtained the search warrant for Officers Gibson and Terry. There is but one conclusion to be reached from the testimony. Officers Terry and Gibson executed a form of affidavit for a search warrant and asked Detective Baer to present the document to Judge Sullivan and obtain a search warrant.

The affidavit for a search warrant is void on its face. The Constitution of Arkansas, Art. 2, § 15, requires the search warrant to be supported by oath or affirmation. The affidavit shows that the officers who executed tlie document did not appear before any officer authorized to take such an acknowledgment. The proof shows that the subscribing officers sent a third party, Detective Baer, to obtain the warrant. The purported affidavit, which is the sole evidence of probable cause afforded the magistrate, is defective in that it states a mere conclusion. A magistrate is not permitted to accept a complainant’s conclusions without question. Walton and Fuller v. State, 245 Ark. 84, 431 S.W. 2d 462 (1968); Giordenello v. United States, 357 U.S. 480 (1958). Mr. Justice White’s concurring opinion in Spinelli v. United States, 21 L. Ed. 2d 637, 89 S. Ct. 584 (1969), analyzes Giordenello and six other cases on the question of prerequisites for issuance of a search warrant. If an officer swears there is contraband at a particular address there are three possibilities for the basis of his conclusion:

(1) The officer has seen the illegal object or objects. In that event his affidavit should assert personal observation; or,

(2) The officer “observed or perceived facts from which the presence of the equipment may reasonably be inferred. In that event the affidavit must recite the perceived facts so that the magistrate may judge the existence of probable cause”; or,

(3) The officer has obtained the information from someone else, for example, an informer. In that event the warrant should not issue unless good cause is shown in the affidavit (or supporting testimony) for crediting that hearsay.

There are a multitude of cases from the United States Supreme Court, in addition to those cited by Mr. Justice White, which detail the manner in which the requirements under alternatives (2) and (3) must be met.

POINT II. The court erred in admitting in evidence the marijuana obtained from the defendant’s person. The officers first went to Bailey’s apartment to conduct a search. Bailey was not at home and they decided to find him before searching. One of the officers knew that Bailey might be found in the vicinity of Wright Avenue and High Street. He was there located and the officers took him into custody for the purpose of taking him to the apartment. They had no warrant for his arrest, nor did they have a search warrant for his person. Prior to placing Bailey in the patrol car the officers searched him, assertedly for weapons. Officer Hunter took the suspect’s billfold from his pocket and handed it to Officer Terry. In the course of the wallet being passed between the officers a tightly rolled cigarette dropped therefrom. The billfold was then inspected and three small brown envelopes were found. The cigarette and the envelopes contained marijuana.

Ark. Stat. Ann. § 43-403 (Repl. 1964) authorizes an arrest by an officer in obedience to a warrant of arrest, and without a warrant if a public offense is committed in his presence, or if the officer has reasonable grounds for believing that the person has committed a felony. We view the search in light of the particular purpose for which the officers testified they made it. First, they did not say they arrested the defendant because they had reasonable grounds to believe he had committed a felony. Specifically, the officers explained that they wanted to take him back with them to the apartment, ostensibly to have him present when the search was made. Officer Hunter explained the purpose of the search thusly:

Q. Why did you shake him down there? '
A. Well, I knew the man and I knew that he was subject to carrying a weapon and, inasmuch as we would be going to carry him back to his apartment, well, I searched him.

Under the recited circumstances we conclude the defendant was not legally under arrest; therefore the search was not incidental to a lawful arrest. However, we recognize there are circumstances under which a suspect may he checked for weapons. If we here concede, without deciding, that the officers had a right under the circumstances to check Bailey (as a suspected felon) for weapons, yet we must ascertain whether that search was “reasonably limited in scope to the accomplishment of the only goal which might conceivably have justified its inception — the protection of the officer by disarming a potentially dangerous man.” Sibron v. New York, 392 U.S. 40 (1968). On the same date Sibron was handed down, the Court decided another search for weapons case, the latter being Terry v. Ohio, 392 U.S. 1 (1968). The searches of Sibron and Terry were compared in Sibron and the Court, had this to say:

The search for weapons approved in Terry consisted solely of a limited patting of the outer clothing of the suspect for concealed objects which might be used as instruments of assault. Only when he discovered such objects did the officer in Terry place his hands in the pockets of the men he searched. In this case, with no attempt at an initial limited exploration for arms, Patrolman Martin thrust his hand into Sibron’s pocket and took from him envelopes of heroin... Such a search violates the guarantee of the Fourth amendment, which protects the sanctity of the person against unreasonable intrusions on the part of all government agents.

As in Sibron the searching officer in the case at bar thrust his hand in Bailey’s pocket and took the pocketbook. That item could conceivably have no reasonable relation to the object of the search, that being for a weapon.

Reversed.


author: John A. Fogleman, Justice.

text:
    O. H. Cooper v. State of Arkansas
    5-5404
    438 S.W. 2d 681
    Opinion Delivered March 17, 1969
    [Rehearing denied April 21, 1969.]

      Robert W. McCorkindale for appellant.

      Joe Purcell, Atty. Gen. and Don Langston, Asst. Atty. Gen. for appellee.
   John A. Fogleman, Justice.

Appellant seeks reversal of his conviction of the crime of malicious injury to graves or monuments. The charge is based on Ark. Stat. Ann. § 41-3706 (Kepi. 1964). Under this act the wilful and malicious destruction, injury or defacement of any grave or monuments or the wilful and malicious removal or destruction of a monument constitutes a felony. Appellant argues three points for reversal. They are:

1. Error in refusal of his motion for directed verdict ;

2. Error in modifying his requested instruction No. 3 and in giving the instruction as modified;

3. Error in denying a motion for new trial.

In reviewing the sufficiency of the evidence as against the motion for directed verdict, we must view it in the light most favorable to the state.

Terry Pillow testified that he had been familiar with the cemetery known as the Adderholt Cemetery for 10 or 15 years and had known of' its location for 35 or 40 years. He said that the graves of some of his relatives were definitely marked, by monuments. According to Mm, some of the monuments were fieldstone bearing names and dates and others were rocks piled over the grave with initials and dates carved on the top rocks. He testified that a dwelling house had been built within 12 or 15 feet of the graves of his relatives. On his visit to the graves preceding that when he saw the house, there was still a fence around the graves. He estimates that there were from 20 to 35 graves in the graveyard all of which were marked with tombstones. He recalled that the graves of the Baker family were marked with marble tombstones. ■ He found the fence in place shortly before appellant bought the property which included the graveyard.

Mrs. Ora Belle Baker McGraughey testified that gray marble tombstones were placed on the graves of her grandparents but that the tombstones were gone at the time of the trial.

Mr. Bichard SMpman who purchased the land including the graveyard along with appellant testified that their deed was made December 22, 1965. After the purchase of the land, he and Cooper walked over it and found evidence of the cemetery in the form of marble tombstones bearing the name of Baker and covered graves. Shipman received a call through which he was advised that there was a graveyard on the land. He relayed this information to Cooper. It was later verified by the person from whom they purchased the land. SMpman also described fieldstone and flat sandstone standing 18 inches off the ground so as to enclose what appeared to be graves. He told Cooper that they should put a small fence around the cemetery if they could establish the boundary lines, saying that they couldn’t afford to molest the cemetery. Shipman returned to the site after a road was constructed and found that the two marble tombstones were gone. The graves appeared to be intact at that time. Shortly, thereafter, Shipman sold his interest in the land to Cooper. He returned to the site later and saw a dwelling house within 10 or 12 feet of the place he had seen the tombstones and graves.

Herbert Terry told of going to the cemetery about the time a road was being constructed by appellant. He stated that he asked Cooper to leave the rock where his relatives’ graves were. At that time the rocks were still in place but the Baker monuments were not. He returned to the site in June or July of 1968 and the rocks on his relatives’ graves had disappeared. Cooper advised Terry that the rocks were in the footings where he was building a house. According to Terry the house was sitting where the graveyard had been and the driveway wTas the cemetery. Terry claimed that the headstone of his grandfather’s grave was jerked up twice during the construction by Cooper and that he and his wife had replaced it both times. He found it removed a third time but did not replace it because it was broken in two or three places.

Pat McEntire testified that Cooper employed him to haul some rock that was piled at or near the site of the cemetery. The rock was put under the floor of Cooper’s brother-in-law’s house for fill.

Charles Youngblood stated that he was hired by Cooper to level some ground at or near the location of the cemetery. He stated that Cooper picked up some flat sandrock stacked to make what appeared to be a tomb and put it in his pickup truck. Youngblood had previously refused to haul the rock off and told Cooper that it appeared to be tombstone rock. He testified that Cooper told him they were graves.

Tom Bearden was employed by Cooper to install the plumbing in the house built near the graves. When he first went to the site he saw two stacks of rocks which looked to him like graves. Later he noticed they were gone. Bearden engaged in a conversation with Cooper and one L. E. Stewart with reference to the choice of a shallow or a deep septic tank for the house being constructed. He could not recall the particular statements made but stated that a decision was reached to use the shallow tank in order to avoid digging in any graves in the cemetery.

George Lowe was a roofer employed by Cooper to roof the house built near the cemetery. He noticed three or four graves near the house. Lowe saw L. E. Stewart using a backhoe in Cooper’s presence to dig* for the installation of a septic tank. According to Lowe, a trench for the septic tank line was being dug across the graves, and he and his son went to the trench where they could see the dark form of a grave six feet from the foundation of the house. Lowe heard Herbert Terry make an angry protest to Cooper and heard Cooper say if Mr. Rockefeller could get by with it so could he.

This evidence was certainly sufficient for a jury to find a guilty verdict if the testimony was accepted at face value.

Appellant requested the following instruction to the jury:

“The three essential facts to constitute the crime with which the defendant is charged are :
1. That he committed the acts charged in the indictment;
2. That he did so wilfully;
3. That he did so maliciously.
You are further instructed that word ‘maliciously’ means the doing of an act in a manner showing a heart regardless of social duty and fatally bent in mischief. It means an act done intentionally and with evil intent, without just cause or excuse, or as a result of ill-will.”

Tlie circuit judge refused the instruction as requested but over appellant’s objection gave the following instruction:

“The three essential facts to constitute the crime with which the defendant is charged are:
1. That he committed the acts charged in the indictment;
2. That he did so wilfully;
3. That he did so maliciously.
The jury is instructed that a malicious act is a wrongful act intentionally done without legal justification or excuse. It is an unlawful act done wilfully or purposefully, the evidence of which may be inferred from the acts committed or words spoken. ’ ’

The gist of appellant’s contention with reference to the instruction given seems to be that it does not sufficiently define the word maliciously as used in the statute.

This court had occasion to consider the meaning of this word in a ease wherein the sufficiency of an indictment for burglary was attacked because the statutory word “maliciously” was not used. Shotwell v. The State, 43 Ark. 345. In treating this question this court said:

“In the use of the word ‘maliciously’ in the statute we cannot presume that the legislature intended that malice towards the owner of the house entered, or toward any one else should become an element in the intent with which the breaking is done. The word must be understood from its context to be intended in its restricted legal significanee which, implies ‘the intent from which follows any unlawful or injurious act, committed without legal justification.’ 1 Bishop Cr. Law Sec. 429. It means doing a wrongful act without just cause or excuse. 2 Bouvier L. Dict. Malice.
Bishop says that ‘maliciously’ in an indictment has been adjudicated an equivalent to •‘wilfully’ in the statute. ‘Maliciously’ is of somewhat lai'ger meaning than ‘willfully,’ which in an indictment would not therefore supply the place, it is presumed, of maliciously in the Statute. 2 Bish. G. Pr. Sec. DC.”

We find that the instruction given by the trial court was correct and that the requested instruction was properly refused. The one offered would have been incorrect even under Gordon v. State, 125 Ark. 111, 187 S.W. 913.

Appellant’s assertion of error in the failure to grant a new trial is based upon the argument that the court should have granted his motion because it had been discovered that the testimony of George Lowe was false. The motion asked a new trial on grounds of newly discovered evidence.

In support of the motion appellant offered the testimony of L. E. Stewart, Joe Miller and appellant’s attorney, J. Loyd Shouse. They also presented the witness George Lowe.

Stewart testified that Lowe had stated subsequent to the trial that his testimony at the trial was false. Joe Miller who numbered both Lowe und Cooper among his hardware customers stated that Lowe came into Miller’s store a week or ten days after the trial when Cooper was present. He overheard parts of a conversation between Lowe and Cooper about the former’s testimony. According to him the two went out into the yard where they engaged in some eoaversatioi which was continued wlien they returned into the store. He heard a discussion between them as to what would be perjury and what would not and advised them to go to appellant’s attorney. Miller said that he later saw Lowe and learned that he had not been to the attorney’s office as promised. He then asked Lowe why he hadn’t been, and Lowe responded that he wasn’t going.

Appellant’s attorney testified that Lowe and Cooper came to his office about a week after the trial. Cooper advised him that Lowe wanted to make a statement. The attorney testified that Lowe said all his testimony in the trial was false, particularly that part about Cooper’s having said that if Rockefeller could tear up a graveyard he ought to be able to do so. He said that Lowe also stated that his testimony about looking down into the excavation for the septic tank and seeing graves was false. When Lowe told Mr. Shouse that Bill Doshier, the prosecuting attorney, made him testify as he did, Shouse said that he didn’t believe him and refused to write up a statement about what Bill Doshier did. Mr. Shouse said that he told Lowe that he would not write out any statement for him because of his disbelief of the statement that the prosecuting attorney had encouraged him to testify falsely. Mr. Shouse suggested that Cooper and Lowe return the next day but Lowe never came back.

Lowe testified that his testimony at the trial was true. He said that he was asked to go to Shouse’s office by the appellant in order to see if there wasn’t some way to obtain a suspended sentence or probation. He claimed that Cooper declined to wait until he could talk to the prosecuting attorney. He said that he left the Shouse office after Cooper had insulted him twice. He denied having told Shouse that his testimony was false or that he had followed Doshier’s suggestions in testifying. On the other hand, Lowe testified that Cooper had suggested that these were the facts. Lowe’s version of the conversation with Miller and Cooper was that they threatened him with civil suits because of his testimony.

Newly discovered evidence is one of the least favored grounds for motion for a new trial. It is addressed to the sound legal discretion of the trial judge, and this court will interfere only in case of an apparent abuse of discretion or injustice to the movant. The determination of whether the application is in good faith and of the weight and sufficiency of the supporting evidence is within the discretion of the trial judge. In order to justify the granting of the motion, the evidence in support thereof should be clear and satisfactory. Gross v. State, 242 Ark. 142, 412 S.W. 2d 279.

Impeaching testimony is not sufficient grounds for granting a new trial on the basis of newly discovered evidence. Philyaw v. State, 224 Ark. 859, 277 S.W. 2d 484. Even if it could be said that there was a recantation on the part of a witness, it is the duty of the trial court to deny a new trial where it is not satisfied that the recanting testimony is true, especially where it involves a confession of perjury. The question whether a new trial shall be granted on this ground depends on all the circumstances of the case including the testimony of the witnesses submitted on the motion for new trial. The answer lies largely within the discretion of the trial court. Clayton v. State, 186 Ark. 713, 55 S.W. 2d 88.

We cannot say that there was any abuse of the trial court’s discretion in this regard.

The judgment is affirmed.

Holt, J., not participating.


author: J. Feed Jones, Justice. John A. Fooleman, Justice.

text:
    Nancy Young Neal v. J. P. Oliver
    5-4820
    438 S.W. 2d 313
    Opinion Delivered March 17, 1969

      Sexton & Wiggins for appellant.

      Shaiv & Bedwell for appellees.
   J. Feed Jones, Justice.

The appellant, Nancy Young Neal, sustained a compensable injury to her left hand while in the course of her employment as a mangle operator for 7-11 Laundry and Cleaners in Fort Smith. 7-11 Laundry and Cleaners is a domestic corporation with J. P. Oliver, his wife and son as the sole owners of the corporate stock. Oliver is the president of the corporation and was general manager and supervisor of employees at the time of appellant’s injury. 7-11 Laundry and Cleaners came within the provisions of the Workmen’s Compensation Law and the appellant was paid full compensation benefits for her injury. The appellant subsequently filed suit in the Sebastian County Circuit Court for personal injuries against Mr. and Mrs. Oliver alleging negligence in assigning her to work on an unsafe machine and in failing to provide the machine with a protective device, in the form of a safety bar, in violation of the state safety code.

On motion for summary judgment, the trial court dismissed the complaint under findings as follows:

“That the Plaintiff, Nancy Young Neal, while employed by the Defendant, J. P. Oliver, and within the course of her employment, did, on April 30, 1965, sustain an injury while operating a mangle ironing machine.
That the Defendant carried full Workmen’s Compensation benefits and that the Plaintiff received full compensation benefits including medical and disability both temporary and permanent.
That in view of the pleadings, the Motion and Affidavit attached thereto, the Court finds there is no genuine issue as to any material facts. Thai question of law is presented to the Court, and the Court finds, as a matter of law, that the Plaintiff, receiving, and accepting full Workmen’s Compensation benefits from the Defendant, J. P. Oliver, is therefore barred from filing a suit in negligence at common law against the same employer, J. P. Oliver.”

On appeal to this court, the appellant designates the following point for reversal:

“Appellee, a supervisor, officer and manager, is a third person within the meaning of the "Workmen’s Compensation statute and, as such, may be held to answer for his own negligence.”

The appellant says “this cause involves the sole issue as to whether or not the manager of a corporate business is a third person within the meaning of the Arkansas Workmen’s Compensation Laws, Ark. Stat. Ann. § 81-1301, el seq.,” and appellant cites several cases from other jurisdictions wherein managers of corporate businesses have been held to be fellow-employees against whom negligent tort actions will lie. But we do not consider the issue in the case at bar to be quite as broad and general as the appellant indicates. The sole issue, as we view the facts in this case, is whether Mr. Oliver, the manager of the corporate business involved in this case, was a third party within the meaning of the Arkansas Workmen’s Compensation Law (Ark. Stat. Ann. § 81-1340 (a) (Eepl. 1960), under the specific facts of this particular case. We conclude that he was not for the reason that he was also the appellant’s employer.

The compensation law does not give or create a cause of action against a third party causing a compensable injury to the employee, but only makes it plain that such common law remedy as the employee already had against tort feasors prior to the enactment of the Workmen’s Compensation Act, was fully preserved and left unchanged by the act when the tort feasor is other than the employer. >

Arkansas Statutes Annotated § 81-1340 (a) (Eepl. 1960) is as follows:

“(1) The making of a claim for compensation against any employer or carrier for the injury or death of an employee shall not affect the right of the employee, or his dependents, to make claim or maintain an action in court against any third party for such injury, but the employer or his carrier shall be entitled to reasonable notice and opportunity to join in such action. If they, or either of them, join in such action they shall be entitled to a first lien upon two-thirds [2/3] of the net proceeds recovered in such action that remain after the payment of the reasonable costs of collection, for the payment to them of the amount paid and to be paid by them as compensation to the injured employee or his dependents.
(2) The commencement of an action by an employee or his dependents against a third party for damages by reason of an injury, to which this act [§§ 81-1301 — 81-1349] is applicable, or the adjustment of any such claim shall not affect the rights of the injured employee or his dependents to recover compensation, but any amount recovered by the injured employee or his dependents from a third party shall be applied as follows: Reasonable costs of collection shall be deducted; then one-third [1/3] of the remainder shall, in every case, belong to the injured employee or his dependents, as the case may be; the remainder, or so much thereof as is necessary to discharge the actual amount of the liability of the employer and the carrier; and any excess shall belong to the injured employee or his dependents.”

The term “third party” is not defined in the act and the first and second parties are not even mentioned, but from the language employed in the context it is used in § 1340 (a), supra, “third party” can only mean some person or entity other than the first and second parties involved, and the first and second parties can only mean the injured employee and the employer or one liable under the compensation act. Thus, it is obvious from the wording of the statute, as well as common sense, that a “third party” within the meaning of the act, must be some party other than an employer who is liable under the act and to whom is also given a statutory right of subrogation against a third party tort feasor. The terms “employer,” “employee” and “employment” are defined in the compensation act, Ark. Stat. Ann. § 81-1302 (a) (b) and (c) (Repl. 1960), as follows:

“(a) ‘Employer’ means any individual, partnership, association or corporation carrying on any employment, or the receiver or trustee of the same, or the legal representative of a deceased employer.
(b) ‘Employee’ means any person, including a minor, whether lawfully or unlawfully employed, in the service of an employer under any contract of hire or apprenticeship, written or oral, expressed or implied, but excluding one whose employment is casual and not in the course of the trade, business, profession or occupation of his employer. Any reference to an employee who has been injured shall, when the employee is dead, also include his legal representative, dependents and other persons to whom compensation may be payable.
(c) ‘Employment’ means:
(1) Every employment carried on in the State in which five [5] or more employees are regularly employed by the same employer in the course of business or businesses, except domestic service, agricultural farm labor, institutions maintained and operated wholly as public charities, the State of Arkansas and each of the political subdivisions thereof, any person engaged in the vending, selling or offering for sale, or delivery directly to the general public, any newspapers, magazines or periodicals, or acting as sales agent or distributor as an independent contractor of or for any such newspaper, magazine or periodical.
(2) Every employment in which two [2] or more employees are employed by any person engaged in building or building repair work.
(3) Every employment in which one or more employees is employed by a contractor who subcontracts any part of his contract.
(4) Every employment in which one or more employees is employed by a subcontractor.”

Appellant correctly points out that this court has held a fellow-employee to be a third party within the meaning of the act, and cites King v. Cardin, 229 Ark. 929, 319 S.W. 2d 214. In the King case King drove a dump truck in hauling asphalt on a highway construction job and Dyer spread the asphalt hauled by King. They both were employed by the same contractor. King negligently backed a dump truck over Dyer and fatally injured him. Dyer was not working for King, he only worked with King and, of course, the compensation act did not absolve King from the legal consequences of his own acts of negligence toward Dyer while they both were working for the same employer. In the King case we said:

“We are not impressed by the argument that the Workmen’s Compensation Act prevents an employee, or his personal representative, from maintaining an action for the negligence of a fellow employee. Our statute merely provides that the remedies under the Act are exclusive of other remedies against the employer. Ark. Stats. § 81-1304. The making of ■ a claim for compensation does not affect the right of the employee or his dependents to maintain an action against a third person. § 81-1340. Under a statute like ours a negligent co-employee is regarded as a third person. Botthof v. Fenske, 280 Ill. App. 362; Kimbro v. Holladay, La. App., 154 So. 369; Churchill v. Stephens, 91 N.J.L. 195, 102 Atl. 657.”

The appellant cites Brooks v. Claywell, 215 Ark. 913, 224 S.W. 2d 37, and argues that since we have held a "president of a corporation to be also an employee for the purpose of bringing the business under the provisions of the compensation act, we should now “pierce the corporate veil” and hold the president and manager of a family corporation to be a fellow-employee for the purpose of third party liability. We do not agree with this contention, for the difference lies in the employee-employer relationship in determining third party liability as in the case at bar and as distinguished from the title of the chief officer of the business entity and nature of the tasks he performs in determining liability for compensation coverage and jurisdiction of the Commission under the act as in Brooks v. Claywell. One is the relationship between two individuals; the other is the relationship between one individual and the business. Brooks was the president of a family corporation and worked in the business along with four other regular employees. Brooks was found to be an employee for the purpose of bringing his business under the definition of “employment” as defined in § 81-1302 (c), supra, and his business was held to be subject to the jurisdiction of the Workmen’s Compensation Commission, Brooks constituting the fifth employee for that purpose. The question of whether Brooks could have also been a third party tort feasor against whom an injured fellow-employee could have maintained a separate tort action was not raised in that case.

The Workmen’s Compensation Act, Ark. Stat. Ann. §81-1304 (Repl. 1960) provides as follows:

“The rights and remedies herein granted to an employee subject to the provisions of this act [§§ 81-1301 — 81-1349], on account of injury or death, shall be exclusive of all other rights and remedies of such employee, his legal representative, dependants, or next kin, or anyone otherwise entitled to recover damages from such employer on account of such injury or death, except that if an employer fails to secure the payment of compensation, as required by the act, an injured employee, or his legal representative, in case death results from the injury, may, at his option, elect to claim compensation under this act or to maintain a legal action in court for damages on account of such injury or death. In such action it shall not be necessary to plead or prove freedom from contributory negligence nor may the defendant employer plead as a defense that the injury was caused by the negligence of a fellow-servant, nor that the employee assumed the risk of his employment, nor that the injury was due to the contributory negligence of the employee.”

It is well established that a co-employee may be liable as a third party tort feasor in a workmen’s compensation case, and the predominen! view does not distinguish between a co-employee who occupies a supervisory position and one who has not achieved a status of such prominence. Tully v. Gardner’s Estate, 196 Kan. 137, 409 P. 2d 782; Boda v. Williams, 195 Kan. 507, 407 P. 2d 471. See also: Gardner v. Stout, 342 Mo. 1206, 119 S.W. 2d 790, involving the foreman of a flour mill; Ellis v. Garwood, 168 Ohio St. 241, 152 N.E. 2d 100, involving the head of an engineering section; Webster v. Stewart, 210 Mich. 13, 177 N.W. 230, where a corporate vice-president was involved. Churchill v. Stephens, 91 N.J.L. 195, 102 A. 657, where a shop foreman was sued.

The phraseology of the statute controls in many of the states in suits against fellow-employees by injured workmen and the case results are as varied as the statutory phraseology. In all the states the cases seem to turn on their own peculiar facts.

In Echols v. Chattooga Merchantile Company, 74 Ga. App. 18, the general manager of a company was held liable in tort for an assault on a fellow-employee. The court held in that case: “The defendant Berry and Chattooga Merehantile Company are not identical parties. His duty not to harm the employee was both as representative of the company and as an individual.”

In Evans v. Rohrbach, et al., 35 N.J. Super. 260, an employee was injured in the course of his employment while spreading a liquid plastic material inside a tank and an explosion occurred. Safety devices were not furnished and installed as required by the labor safety law. The injured -employee was paid compensation but sued the president of the corporation for failure to furnish the required safety devices. The suit was dismissed in that case, on the theory that the president was too far removed in the chain of authority, the employer being a large corporation.

In Leidy v. Taliaferro, 260 S.W. 2d 504, a corporate employee was riding in a corporation truck being driven by his father who was also an employee of the corporation. A suit against the corporate president and a corporate stockholder was permitted to go to the jury on the question as to whether plaintiff’s father, at the time of the accident, was acting as the personal agent of the defendant corporate president. In that case the two employees were on a personal mission for the company president to pick up personal furniture belonging to the president.

In Schumacher v. Leslie, 232 S.W. 2d 913, an injured workman who had received workmen’s compensation filed suit against the attending physician for alleged malpractice in connection with the industrial injury. In permitting the suit against the physician as a third party feasor, the Missouri Court said: “A third person is one with whom there is no master and servant relationship under the Act. * * * Section 3699, supra, recognizes common law rights against third persons and indicates an intention to preserve rather than abrogate such rights. No employer and employee or master and servant relationship existed between the instant plaintiff and defendant. The benefits of the Act accrue to those who share its burdens. Defendant did not share its burdens. He is not entitled to its benefits. Hence, w.e conclude he was a stranger under the Act, a ‘third ¡person.’ ”

In Peet v. Mills, 136 P. 685, an early Washington case, a workman was injured in a train collision which occurred in a fog. The railroad system was equipped with a block signal system for use in foggy weather, but when a new president of the company assumed control, the company ceased operating the block signal. Dismissal of the suit against the president was affirmed on appeal because the workman was covered by workmen’s compensation.

In the case of Rehn v. Bingaman, 36 N.W. 2d 856, a Nebraska Workmen’s Compensation Act had preserved to an injured employee his common law remedy and in holding that a fellow-employee was a third party within the meaning of the act, the court said:

“We conclude that the employee’s right of action against third persons for negligence proximately causing his injuries was a common-law right already existent outside of and notwithstanding the Workmen’s Compensation Act. In other words, section 48-118, R.S. 1943, not only preserved the employee’s common-law right to recover from third persons as it was before the act, but also, in the final analysis, simply gave the right of legal subrogation to his employer without depriving the employer of his right to equitable subrogation under circumstances requiring its application. Burks v. Packer, 143 Neb. 373, 9 N.W. 2d 471.
* * * [I]t is generally the rule that a fellow employee would also be such person regardless of the capacity of his employment, so long as he did not occupy the relationshi/p of employer of plaintiff. 57 C.J.S., Master and Servant, § 578, p. 348; 35 Ana. Jur. Master and Servant, § 425, p. 954, and § 526, p. 955, Annotation, 99 A.L.R., page 422; Hudson v. Moonnier, 8 Cir. 94 F. 2d 132, Id., 8 Cir., 102 F. 2d 96.” (Emphasis supplied).

Thus it is seen that a president or manager of a corporation or a business may or may not be a fellow-employee to others who are employed by the same corporation or in the same business,. and he-may or may not be personally liable for his tort causing injury to a fellow-employee, depending- on the nature of the tort in some states and the scope of his duties and authority in others. None of the cited cases quite reach the problem presented in the case at bar. They all deal with situations where,the fellow7employee tort feasor is something less than the employer also.

The appellant has cited no case, and we have found none, where the owner and president of a family corporation who hires, fires and directs his employees and who has provided them workmen’s compensation insurance coverage, has been held personally liable in tort for injuries sustained by negligently maintained equipment or unsafe working conditions under a workmen’s compensation statute similar to our own. Under compensation coverage the employer gives up the defense of contributory negligence and the injured employee is relieved of the burden of proving negligence but he gives up the right to sue his employer in a court of law.

A president of a corporation or the owner of a business may or may not be an employee of the corporation, or in the business, for the purpose of determining liability for compensation benefits under the Workmen’s Compensation Law. That would depend on what he does. Brooks v. Claywell, supra.

In the case at bar Mr. and Mrs. Oliver owned the corporate business and they, as well as the corporation, were the employers.

Arkansas Statutes Annotated § 81-1338 (c) (Eepl. 1960) provides as follows:

“No policy of insurance shall he issued against liability under this act [§§ 81-1301 — 81-1349] unless such policy cover the entire liability of the employer as to the business or businesses identified in the policy. As to any questions of liability between the employer and the insurer the terms of the policy shall govern.”

Arkansas Statutes Annotated § 81-1339 (Eepl. 1960) provides as follows:

“Any employer required to secure the payment of compensation under this act [§§ 81-1301 — 81-1349] who fails to secure such compensation shall be guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of not more than five hundred ($500.00) dollars, or by imprisonment for not more than one [1] year, or by both such fine and imprisonment. This section shall not affect any other liability of the employer under this act.”

The Olivers procured workmen’s compensation insurance for the benefit of their employees, including the appellant, and the appellant was paid the full compensation benefits under the compensation act and the insurance so procured. The appellant was not injured by a direct negligent act of Oliver, he wasn’t even on the premises when the appellant was injured. The negligence the appellant complains of is Oliver’s failure to provide a safe place for her to work as required by state law. Certainly the safety requirements under the lab- or laws should be enforced in this state and their violation should not go unpunished, but if Oliver was merely a third party fellow-employee, he had no duty to furnish a place for appellant to work — safe or otherwise. If the corporation was the employer and Oliver was the mere president, be was not personally liable in tort or under the compensation act for injuries sustained by corporate employees who are injured on defective corporate owned and maintained machines and equipment. If Oliver was the actual employer, his corporate title made no difference. His business was within the provisions of the Workmen’s Compensation Law, the appellant’s injury was compensable under the compensation law, and her rights thereunder are exclusive.

AYe hold that an employer-employee relationship existed between Oliver and the appellant at the time of her injury. AYe conclude that in no event could Oliver have been a “third party” within the meaning of Ark. Stat. Ann. § 81-1340 (a), supra, under the pleadings and facts of this case, and that the judgment of the trial court should be affirmed.

Affirmed.

Fouleman and Byrd, JJ., dissent.

John A. Fooleman, Justice.

I respectfully dissent. 1 agree with the majority in many particulars. I agree that the question presented is as narrow as the majority state it to be. I would keep it just that narrow. In order to do so, and to put the question in proper perspective, it is necessary that more of the background on which the summary judgment was granted be disclosed. It was alleged in the complaint that Oliver had actual knowledge of the lack of the proper safety guard required by the safety code on a machine operated bjr appellant. It was also alleged that Oliver specifically assigned appellant to the operation of this machine without remedying the defect or warning appellant. It was further alleged that Oliver had twice previously been warned by the Department of Labor of this deficiency and of the clear and present danger posed to the safety of employees required to operate it. These allegations were not controverted by the affidavit in support of Oliver’s motion for summary judgment.

I also agree that a “third party” is an entity other than the employer and employee.

• I further agree that most of the cases cited in the majority opinion really fail to reach the issue here. It seems to' me that at least one of them lends more support to my position than to that of the majority, as will presently be demonstrated.

I do not agree that appellant is asking us to pierce the corporate veil. Actually the reverse is true. Appellee, the majority stockholder in a family corporation, has asked that the corporate veil hung by him and his family for their personal protection against business creditors be pierced for his own benefit when recognition of the separate entity would subject him to liability in a personal capacity as an employee of the corporate structure erected by him. Arkansas is quite liberal in affording corporate protection to a business enterprise. We have even permitted the formation of one-man corporations. Both the legislative and judicial branches have generally required a corporate status more similar to the leopard than to the chameleon. The holding of the majority would' let appellee change his protective coloration as the mood strikes him.

The rule announced by the majority in this case is this: if a majority stockholder of a family corporation, who also manages the business and supervises the employees, is sued as a “third party” tort-feasor by an employee of the corporation he may, at his option, disregard the corporate fiction he created and seek the immunity from common law tort liability he would have had as an individual employer under the Workmen’s Compensation Law. Such a result allows the appellee to “eat his cake and have it too” and is patently inconsistent with the rules heretofore announced by this court pertaining to “piercing the corporate veil.”

In Rounds & Porter Lbr. Co. v. Burns, 216 Ark. 288, 225 S.W. 2d 1, this court said, “It is only when the privilege of transacting business in corporate form has been illegally abused to the injury of a third person that the corporate entities should be disregarded.” This, decision was followed by Plant v. Cameron Feed Mills, 228 Ark. 607, 309 S.W. 2d 312. There the corporate veil was pierced in an equity action to enforce a labor and materialman’s lien on a building. The defendant corporations were a parent and a subsidiary which the court said were identical for the purposes of the suit. We held that even though the corporations were, legally separate entities, it would constitute a constructive fraud on the lien claimant to allow them to claim entirely separate existences. Although we said that justice required the piercing of the fiction of the corporate entity, we added that the rule should be applied with great caution.

In Black and White v. Love, 236 Ark. 529, 367 S.W. 2d 427, we reaffirmed our conclusions as set out in Round & Porter Lbr. Co. v. Burns, supra, and pierced the veil of a corporation to prevent, “piitting fiction.above right and justice.” Finally, in Banks v. Jones, 239 Ark. 396, 390 S.W. 2d 108, we refused to pierce the corporate veil, saying, “We agree with the chancellor that the evidence in the instant case does not support a finding that there was an illegal abuse of the corporate form to the injury of the appellant.”

Thus the majority of the court have for the first time permitted the corporate fiction to be disregarded at the option of the incorporaters for their own benefit and not for the benefit of one injured by the illegal abuse by another of the privilege of transacting business as a separate corporate entity. . This holding is not only inconsistent with our previous decisions with reference to the equitable rule permitting the piercing of the corporate veil, but it is inconsistent with our holding in Brooks v. Claywell, 215 Ark. 913, 224 S.W. 2d 37. There we held that the’managing officer of a corporation, owned by him, his sister and brother-in-law, from which he took all the profits and of which he was in absolute control, was an employee of the company for the purpose of determining whether that company was subject to the Workmen’s Compensation Act.

My position is not unprecedented. In Adams v. Fidelity and Casualty Co. of New York, 107 So. 2d 496 (La. App. 1958), the Louisiana court had before it a case which is closely analogous to this one. In that case plaintiff employee sought to sue several high-ranking corporate officers and stockholder directors of the corporation employer as a “third party” under a workmen’s compensation statute similar to our own. The defendants contended that because the complaint alleged that they failed to perform duties which arose out of their position as officers and directors of the corporation they were therefore liable only to their corporate employer and not to a third party such as an ¡employee. This contention was rejected. It is strikingly similar to the majority’s assertion that if the corporation were the employer and Oliver were the mere president he was not liable in tort or under the compensation act for injuries sustained by corporate employees who are injured on defective corporate owned and maintained machines and equipment.

The Adams case has been followed in Travelers Ins. Co. v. Brown, 338 F. 2d 229 (5th Cir. 1965) and Herbert v. Blankenship, 187 So. 2d 798 (La. App. 1966). In the latter case two of the defendants were officers and the stockholders of the employer corporation. The court there said that officers or agents of corporate employers may themselves be liable in part insofar as their own personal negligence contributed to the accident causing injury to an employee even though the exclusive remedy against the corporation itself for the workman’s injuries was in compensation. Other cases in which suits by injured employees against officers, directors and stockholders of a corporation as “third parties” have been permitted include Webster v. Stewart, 210 Mich. 13, 177 N.W. 230 (1920); Witherspoon v. Salm, Ind. App., 237 N.E. 2d 116 (1967).

In Echols v. Chattooga Mercantile Co., 74 Ga. App. 18, 38 S.E. 2d 675 (1946), cited by the majority, the defense of the general manager of the corporation against a tort action by an employee was that the manager was the alter ego of the corporation. The court rejected this defense. In Evans v. Rohrbach, 35 N.J. Super. 260, 113 A. 2d 838 (1955), also cited by the majority, the court indicated that a director or officer who committed a tort or directed a tortious act to be done or who participated or cooperated therein was liable to third persons injured thereby, even though liability might also attach to the corporation.

I should point out that the decision in Peet v. Mills, 76 Wash. 437, 136 P. 685 (1913) might appear to give some support to the position of the majority were it not for the fact that the Workmen’s Compensation statute involved abolished all civil actions arising out of an employment except those expressly saved by the act. The only actions saved were those for injuries caused by the act of a third party not in the same employ as the injured workman.

I cannot sanction the misuse of the equitable device of piercing the corporate veil to arrive at a desired result under the Workmen’s Compensation Law. It is, perhaps, a hard rule of law that would require the court to acknowledge the separate legal existence of 7-11 Laundry Cleaners, Inc. from appellee J. P. Oliver who is the principal stockholder and manager. However, it is my view that this problem addresses itself to the legislature, not the courts. I would reverse.

Byrd, J., joins in this dissent.

      In this respect it should be made clear that there is no appeal from the summary judgment in favor of Mrs. Oliver.


author: Conley Byrd, Justice.

text:
    J. C. McCaa, Jr. v. Norma P. McCaa
    5-4850
    438 S.W. 2d 325
    Opinion Delivered March 17, 1969

      A. Jan Thomas, Jr. for appellant.

      Vincent E. Skillman, Jr. for appellee.
   Conley Byrd, Justice.

This messy divorce case arises out of the stormy marriage between appellant J. C. McCaa, Jr. and appellee Norma P. McCaa. The parties were married on July 12, 1964, following a divorce between J. C. and his first wife Madeline in which Norma ■was named corespondent. Following a separation on Feb. 21, 1965, Norma filed suit for separate maintenance and J. C. counterclaimed for divorce. At a hearing on Sept. 8th 1965, the trial court found that neither party was entitled to the relief prayed for, each being found equally guilty. In that decree the trial court also found, “that all rights to possession of property as between the parties are hereby adjudicated, it being the finding of 'this 'court that neither of the parties should take any interest or share in the property of the other; that this property right adjudication should be res judicata in any divorce action or litigation that may occur hereafter between the parties on the grounds of three years separation ...”

Tlie present action was instituted on May 25, 1967, by Norma who alleged a resumption of marital relations following the 1965 decree and sought a divorce upon the ground of personal indignities and adultery allegedly committed with a Miss Arnold. ' Mr. McCaa counterclaimed for divorce upon the grounds of three years separation. The trial court found that the parties had resumed their marital relations following the Sept. 8, 1965, decree; denied Mr. McCaa his :divorce upon the grounds of three years separation; and awarded a divorce to Norma upon the grounds of adultery. In so doing the court recognized that by operation of law Norma would be entitled to 1/3 interest for life in any real estate and 1/3 interest in any personal property of McCaa. Mr. McCaa has appealed contending that the trial court failed to give full faith and credit to the 1965 decree; that Norma’s testimony and that of her witnesses failed to meet the requirements of corroboration in order to sustain a divorce for adultery; and that the Chancellor abused his discretion in granting the divorce — i.e., his findings are contrary to preponderance of the evidence.

Me find appellant’s contentions to be without merit. Norma, her daughter, her mother and Joe Russell all testified that McCaa and Norma purchased a house from Joe Russell on Cranford Street in Memphis into- which they moved during September 1966, and in which they lived and cohabitated until November 12th or 13th of 1966, In fact Joe Russell testified that Mr. and Mrs. McCaa spent one night at the house before it was purchased and that he and his wife served them brunch the next morning.

Norma testified that following the last separation she found her husband at Pete’s and Sam’s Restaurant in Memphis with two women and that when she started checking on the girls, that she ran across Miss Arnold’s name, whom she met in January 1967. That in January 1967, she and Miss Arnold went to Mr. McCaa’s home in West Memphis about 8:30 A.M. and observed one Mrs. Hart in the middle of Mr. McCaa’s bed with only a pajama shirt on.

Miss Arnold, age 25, testified that she met Mr. Mc-Caa in January in 1966 while living in Osceola. That in March 1966, she moved to an apartment in Memphis which she and Mr. McCaa had picked out together and that their intimate relationship continued for approximately one year until she became aware of his interest in Mrs. Hart.

Mr. McCaa denies that he resumed his marital relationship with Norma; denies his adulterous relationship with Miss Arnold; and asserts that Mrs. Hart was at his house in January 1967 only to make some telephone calls while she was waiting on her automobile to be repaired. On cross ¡examination he admitted having been out to dinner with Mrs. Hart and having been to Kentucky to visit with Mrs. Hart and her children. He also explained that Mrs. Hart at the time of trial was in Kentucky with her parents and that he wouldn’t involve her in this “mess”.

The 1965 decree is obviously not res judicata of the cause of action herein proved. We held in McKay v. McKay, 172 Ark. 918, 290 S.W. 951 (1927), that a decree denying a divorce was not res judicata of a cause of action not then in existence. The same rule is here applicable.

It is true that in Payne v. Payne, 42 Ark. 235 (1883), we pointed out that courts are reluctant to grant a divorce upon the uncorroborated testimony of a particeps criminis. However in a case such as this where one particeps criminis openly admits the adulterous relationship and another woman is found in the husband’s boudoir clad only in a pajama top, we are unwilling to say there is insufficient evidence to sustain the trial court’s finding of adultery.

Neither can we say that the trial court’s finding upon the whole case is contrary to a preponderance of the evidence.

Affirmed.

Fogleman, J., disqualified.


author: Frank Holt, Justice.

text:
    Norman Leonard v. Fay Downing
    5-4813
    438 S.W. 2d 327
    Opinion Delivered March 17, 1969
    TF. B. Howard and Jack Segars for appellant.

      Penix & Penix and Holland & Erwin for appellee.
   Frank Holt, Justice.

The appellee brought this action to recover the down payment on a house. The chancellor found there had been a mutual agreement to rescind the oral contract of purchase and awarded appellee the sum of $1,860.00, together with interest from the' date of the alleged rescission. For reversal, appellant primarily contends that the evidence offered by appellee on rescission was insufficient as a matter of law in that the alleged agreement for refund was indefinite and uncertain as to terms and time of payment.

Appellee paid appellant $2,000 as a down payment on the purchase price of a house. The balance of $12,-025 was to be paid at the rate of $80 per month with interest. According-to appellee, her ability to purchase was dependent upon her securing a Veterans Administration loan for'the balance of the purchase price. With that understanding, she moved into the house. A few days later she went to a real estate office where she was advised that she would not be able to secure the VA loan. Appellant was then called to the office and acquainted with this fact. Appellee testified that appellant agreed he would refund the $2,000 down payment, less $100 for damage to the floor in the house and $40 for two weeks’ rent. Thus, the net refund of $1,860 was agreed upon. Appellee’s version was corroborated by her daughter and the real estate agent. Appellant testified that a refund was discussed but he made no oral agreement and refused to sign a written one. Further, that he could not make a refund until he had discussed it with his partner. ' According to appellee, the terms of the rescission and contract were definite and certain that he would refund $1,860 of the $2,000 deposit. She testified : .. .

“Q. What did he say about returning your money?
A. I don’t remember what he had, $1,600 or $1,700 and I said I would wait on the balance.
Q. What was his response to that?
A. He said he would give it back the .next day.”

Before appellee moved, appellant .furnished the material to repair the floor and never sent her a bill. There was evidence that after the appellee moved out of the house, appellant showed it to prospective purchasers and placed a “For Sale” sign on the premises. According to appellant, he advised any prospective purchaser that the house would be for resale when it was settled in court.

It is well settled that parties to an executory contract may rescind or modify it by mutual agreement. Elkins v. Aliceville, 170 Ark. 195, 279 S.W. 379 (1926); Morgan v. Shackleford, 174 Ark. 337, 295 S.W. 46 (1927); Swift v. Lovegrove, 237 Ark. 43, 371 S.W. 2d 129 (1963); 17A C.J.S., Contracts § 387. It is true, as urged by appellant, that time, place and amount are usually considered indispensable terms to a definite contract. Crateford v. General Contract Corp., 174 F. Supp. 283. However, the general rule is that a promise to perform within a reasonable time is sufficient. 17 Am. Jur. 2d., Contracts, §§ 80, 82.

In the case at bar we cannot say that the finding of the chancellor that the appellant and appellee mutually agreed to rescind the contract of purchase is against the preponderance of the evidence. We think the terms and time of payment are reasonably certain and definite and meet the usual standards where two laymen attempt a mutual understanding under the circumstances that are here presented.

Since there exists a mutual agreement to rescind the original purchase agreement, it becomes unnecessary to consider appellant’s contentions that appellee was never refused a YA loan and that he is willing to perform the original purchase agreement.

Affirmed.


author: Emon A. Mahony, Special Justice.

text:
    Nineteen Corp. v. Guaranty Financial Corp.
    5-4697
    438 S.W. 2d 685
    Opinion Delivered March 17, 1969
    [Rehearing denied April 21, 1969.]

      John Harris Jones for appellant.

      Coleman, Gantt, Ramsay & Cox for appellee.
   Emon A. Mahony, Special Justice.

This litigation originated in the Chancery Court of Jefferson County, Arkansas. The appellee was the plaintiff in the lower court. The complaint alleges that Guaranty Financial Corporation, the plaintiff, was the owner of all of the outstanding capital stock of Universal Insurance Company. That on or about October 1, 1967, it entered into a written contract with the defendant, Nineteen Corporation, a corporation organized and existing under and by virtue of the laws of Texas, whereby the plaintiff agreed to sell and the defendant agreed to purchase all of the outstanding common stock of the Universal Insurance Corporation pursuant to a written contract, a copy of which was attached to the complaint. The contract recites a cash consideration of $141,000 and a further consideration of the transfer of $175,000 in principal amount of first real estate mortgage loans qualifying as investments under the insurance laws of the State of Arkansas. The total consideration was therefore $316,000. The execution of this contract is admitted by the defendant, Nineteen Corporation.

The first sentence of paragraph 3 of the complaint reads as follows: “Subsequent to the execution of the contract for the sale of stock between the parties made Exhibit ‘A’ to this complaint, H. M. Weisenbaker, president of the defendant, requested the plaintiff to conclude the sale of the stock of Universal Insurance Company (which will hereafter he referred to for simplicity as ‘Universal’) by the exchange of a promissory note of Nineteen Corporation to be secured by a collateral pledge of the stock being purchased from Universal Insurance Company and a first mortgage lien upon certain real estate in Oklahoma City in lieu of the amount to have been paid in cash under the said contract for sale of stock.” This sentence was also admitted to he true by defendant.

The next sentence of paragraph 3 of the complaint, that is, the second sentence, alleges as follows: “In addition he requested that the amount of the qualifying first real estate mortgage loans to he transferred by the defendant to the plaintiff under the contract for sale of stock be reduced from $175,000 as therein provided to $147,557.24, which was the principal balance of first real estate mortgage loans held by Universal on October 23, 1967.” The defendant denied the allegations of said second sentence of said paragraph 3 but admitted as alleged by the complaint that on October 23 it made, executed and delivered to the plaintiff its collateral promissory note and pledge agreement in the sum of $145,772.27 as described in the third sentence of said third paragraph. This new note was secured by a pledge agreement in which the 150,000 shares of common stock of the insurance company were pledged and there was also mortgaged an interest in certain real property in Oklahoma.

The original written contract of sale which provided for a consideration of $141,000 in cash and $175,000 in mortgage loans further provided that the $175,000 worth of mortgage loans paid as a portion of the consideration would be transferred by Guaranty Financial Corporation to the insurance company in exchange for first mortgage loans then on hand in the insurance company. No cash consideration was ever paid. A note in the sum of $145,772.27 was delivered on October 23rd to plaintiff, Guaranty Financial Corporation. On the same date, pursuant to the contract of sale, the then existing officers and directors of the insurance company resigned and the new stockholder, Nineteen Corporation, elected new officers and directors. The new officers and directors then transferred to Guaranty Financial Corporation the notes and mortgages held by the insurance company which had a principal amount of $147,557.24. Nineteen Corporation, however, never transferred any mortgage notes to Guaranty Financial Corporation which might be exchanged for the mortgage notes of the insurance company as contemplated by the contract of sale.

The complainant then sued and asked judgment for the amount of the note with interest and for the principal value of the mortgages, making a total amount of $293,329.51 plus interest and attorneys fees. It requests foreclosure of the pledge on the common stock.of the corporation.

The defendant’s original answer alleged a mutual rescission of the sale and note on or about October 26, 1967. It appears that on or about said date the officers of the insurance company, who had been elected by the defendant Nineteen Corporation, resigned. Guaranty Financial Corporation then nominated and elected new directors and officers of the insurance company and the mortgage notes which had been transferred from the insurance company to Guaranty Financial Corporation were retransferred by Guaranty Financial Corporation to the insurance company. Defendant Nineteen Corporation then filed its amended and substituted answer and counterclaim and in this answer made the admissions and denials above referred to. The defendant also pleaded that the note and mortgage described in paragraph 3 of the complaint were usurious and void and pled usury as a full and complete defense. Defendant prayed that the complaint be dismissed, that plaintiff be ordered to surrender to defendant the stock of the insurance company, that the collateral promissory note, pledge agreement and real estate mortgage be can-celled and annulled, and all other proper relief.

At the time of the trial only one witness testified for the plaintiff. This witness was Mr. McCarty, who was the president of Guaranty Financial Corporation. The original contract of sale was introduced. The testimony then was that there were various negotiations for the amendment of the contract whereby in lieu of the $141,000 cash payment the note, pledge agreement and real estate mortgage were executed.

In response to the question of usury, the plaintiff offered a balance sheet which reflected that the net worth of the company on October 23, 1967, was $272,-392.64. The witness testified that the value of the charter was $22,000, or at least that was the value which the defendant agreed to pay. These 2 figures he testtified added together, less the amount of the mortgage notes on hand on October 23, 1967, were equal to the amount of the note which was executed by defendant, Nineteen Corporation. He further testified that between October 1 and October 23 three of the mortgages owned by the insurance company had been sold and there had been various payments on the mortgage indebtedness. Defendant objected to this testimony under the parol evidence rule and on the grounds further that it was at variance with the terms of the complaint. Plaintiff then rested.

The defendant offered only one witness, Joe B. Bernard. Mr. Bernard’s testimony was to the effect that he lived at Amarillo, Texas, and he had executed a subordination agreement which subordinated the lien of his second mortgage on the lands lying in Oklahoma to a new mortgage which might be executed by Nineteen Corporation to the insurance company, Universal Insurance Company. Defendant offered no other testimony.

The complaint in the case was filed on December 20, 1967. The Chancellor issued his opinion on April 29, 1968. The Chancellor issued findings of fact in which lie found that there was a new agreement, that instead of a cash payment as provided for in the written contract the defendant was to execute its promissory note to be secured by a collateral pledge of the Universal stock and a first mortgage lien upon certain real property in Oklahoma City, Oklahoma. The new agreement provided further that the defendant was to transfer to the plaintiff its own first real estate mortgage loan with a principal balance of $147,557.24. He further found that even though Mr. McCarty’s testimony is not uncontradicted as a matter of law, nevertheless, no witness took the stand to contradict Mr. McCarty’s testimony and held against the defendant on its contention of usury. The Court held that the plaintiff is entitled to a judgment in the sum of $293,329.51 with interest plus a $10,000 attorney’s fee and that the property should l)e offered for sale at a public sale to the highest bidder for cash. A decree was entered pursuant to this opinion and in due course this appeal ensued.

We hold that the findings of the Chancellor were not against the weight of the evidence on the question of usury. The defendaut-appellant has not carried the burden of proving usury which is upon the party ■who asserts it. Carter v. Zachary, 243 Ark. 104, 418 S.W. 2d 787; Wallace v. Hamilton, 238 Ark. 406, 382 S.W. 2d 363. The complaint alleged that a new agreement was Mitered into. This was admitted in the answer. The Court found that a new agreement was entered into. Obviously the new agreement could be supported by a new consideration. We think that evidence was admissible to show that there had been a change in the assets of the company whose stock was being transferred. We further think that evidence is admissible to show' the relationship between this new consideration and this change in assets. Certainly there is no contention that there wras usury in the original agreement, that is, the written agreement, and we hold that usury in the new' agreement was not established by defendant-appellant, who had the burden of proof. In reaching this conclusion w'e have taken due note of appellant’s contention that the first sentence in paragraph 3 of the complaint, which is quoted above, establishes that the new' agreement wras usurious. We do not agree wdth this contention. However, if appellant’s interpretation of the conclusion that should be reached with respect to this sentence is correct, then certainly the burden would be on the creditor to show that the contract was not usurious and oral testimony is admissible for this purpose. Andrews v. Martin, 245 Ark. 1010, 436 S.W. 2d 285; Peoples Loan and Investment Co. v. Booth, 245 Ark. 144, 431 S.W. 2d 472; Universal C.I.T. Credit Cor poration v. Lackey, 228 Ark. 101, 305 S.W. 2d 858.

Appellant also attacks the provisions of the decree as to the application of the proceeds. However, the pledge agreement authorized the application of the proceeds on any of the liabilities secured by the pledge agreement and the pledge agreement secures the original note and all other liabilities, direct or indirect, absolute or contingent, due or to become due to the appellee. We do not find the directions of the decree with reference to the application of the proceeds are inequitable, that is, that the proceeds of the aforesaid sale of the common stock shall be applied first against the portion of the judgment obtained by the plaintiff by virtue of defendant’s failure to cause the plaintiff to receive real estate mortgage loans in the principal sum of $147,-557.24, together with the interest accruing thereon.

Appellant next states that the decree is in error for the reason that it ordered a sale of the property for cash contrary to Ark. Stat. Ann. 51-1109 which reads, “ Sales of personal property made by order of the court shall be on a credit of three months; * * * ’ ’

We agree with appellee that this litigation involved a foreclosure of a pledge by court action and that pledges are governed by the Uniform Commercial Code. If the sale had not been made by order of the court the collateral might have been disposed of in any way that was commercially reasonable but, since the foreclosure was by judicial action, then the requirements of Ark. Stat. Ann. 51-1109 govern and by the direct terms of the statute, sales by order of the court must be on a credit of three months. Turner v. Ironside, 208 Ark. 17, 184 S.W. 2d 810; De Yampert v. Manley, 127 Ark. 153, 191 S.W. 905.

We also agree with the appellant that the decree is in error insofar as it attempts to fix a lien on lands lying in Oklahoma.

For the reasons stated the decree is reversed and 'remanded with instructions to enter a decree in accordance herewith.

Fogleman, J., disqualified.