author:
Ed. F. McF addin, Associate Justice. Paul Ward, Associate Justice,
      Jim Johnson, Associate Justice,

text:
    Andres v. First Ark. Development Finance Corp.
    5-1842
    324 S. W. 2d 97
    Opinion delivered May 18, 1959.

      Gardner A. A. Deane, Jr., for appellant.

      Bruce Bennett, Atty. General, Bose, Meek, House, Barron d Nash, for appellee.

      James P. Baker, Jr., Amicus Curiae brief.

      Dickson d Putman, Minor Millwee and E. J. Ball, Amici Curiae brief.
   Ed. F. McF addin, Associate Justice.

This is a suit brought by appellant as a citizen, resident and taxpayer, seeking, inter alia, a declaratory judgment regarding the validity of Act No. 567 of 1957, which is captioned: “An Act To Provide For Development Finance Corporations; To Define Their Functions, Powers, and Duties; And For Other Purposes”. The Trial Court held against the appellant on all points, and this appeal ensued; The defendants below (and appellees heré) are: First Arkansas Development Finance Corporation (hereinafter referred to as “Finance Corporation”), the State Board of Finance (hereinafter referred to as “Board”), and individuals composing the Board. (See Act No. 338 of 1955 and § 13-401 et seq. Ark. Stats.)

The complaint alleged, inter alia:

(a) That Finance Corporation purports to be organized and existing under provisions of Act No. 567.

(b) That, pursuant to Act No. 567, Finance Corporation proposes to lend to the Scott County Industrial Development Corporation (organized and functioning under Act No. 404 of 1955) the sum'of $130,000100 to énable the Scott County Industrial Development Corporation to assist the Scott' County Milling Company (a private Arkansas corporation) to establish and operate a feed mill and broiler hatchery.

(c) That to provide funds to make said loan of $130,000.00 to the Scott County Industrial Development Corporation, the defendant Finance Corporation proposed to issue and sell to the public and to the State Board of Finance, $130,000.00 of Finance Corporation’s bonds, as authorized by the Act No. 567.

(d) That unless restrained, the State Board of Finance “. . . will be called upon under the provisions of the said Act No. 567 to purchase, pay for, and take delivery of a portion of the said bonds of . . .” Finance Corporation; and, unless restrained, will act to the great and irreparable injury of the plaintiff and others similarly situated.

(e) That the Act No. 567 is unconstitutional in whole; and if not unconstitutional in whole is unconstitutional by reason of § 19 of said Act.

(f) That Finance Corporation is not validly and legally organized and functioning.

The prayer was, inter alia, that a decree be entered holding Finance Corporation to have been illegally organized, and that Act No. 567 be held void in toto, or at least as to § 19.

The Act No. 567

Before discussing the assignments listed on appeal, we give a brief synopsis of some of the pertinent portions of the Act No. 567. Fifteen or more duly qualified citizens may organize a “development finance corporation” by filing with the State Bank Commissioner certain articles. The State Bank Commissioner, upon making inquiry and being satisfied with the standing, ability, and residence of the incorporators, may issue his certificate of preliminary approval. The incorporators may then proceed to obtain additional stockholders and the payment of stock, may elect directors, adopt by-laws and other regulations, and then submit a further report to the State Banking Board. The State Banking Board will make further investigation to ascertain whether public convenience and necessity require the finance corporation, whether the stockholders possess the requisite qualifications, whether at least $100,000.00 of common stock, and at least $900,000.00 of preferred stock have both been fully paid for, and whether the by-laws and regulations are in keeping with all laws of this State. If the State Banking Board is satisfied of all of the foregoing, then the State Bank Commissioner will issue a certificate of incorporation; and there must be included in the name the words, “Arkansas Development Finance Corporation”.

There may be any number of such finance corporations so organized. Section 13 of the Act No. 567 says in part: “The purposes of each development finance corporation organized under the provisions of this Act shall be to promote, stimulate, develop, and advance the business prosperity and economic welfare of the State of Arkansas and its citizens; to encourage and assist through loans, investments, or other business transactions, in the location of new business and industry in this State . . . and to provide financing for the promotion, development, and conduct of all kinds of business activities in this State.”

The Act further provides that the corporation shall act without profit to any of its members, shall never receive deposits from the public, but may issue bonds and debentures, and that all such obligations shall be on a parity as to security and shall be secured by a lien on the entire assets of the corporation. The Act also provides in § 19 that the State Board of Finance may purchase and hold, in its securities account, bonds of any development finance corporation as the State Board of Finance may see fit. Section 22 of the Act makes the bonds of any finance corporation eligible for investment by certain Funds. Each finance corporation organized under the provisions of this Act shall be subject to the supervision, examination, and control of the State Bank Commissioner jointly with the State Board of Finance. So much for a brief synopsis of the Act : now we come to a discussion of the assignments made by the appellant.

I. The appellant says: “Said Act No. 567, in that it authorises the issuance of bonds for the purpose of industrial and agricultural development, is in violation of the provisions of Article 16, Section 1, of the Constitution of the State of Arkansas, as amended by Amendment 13 to the Constitution of the State of Arkansas, and is in violation of the provisions of Amendment No. 17 to the Constitution of the State of Arkansas, as amended by Amendment No. 25 to the Constitution of the State of Arkansas. Throughout the appellant’s brief there is the refrain that the Act No. 567 is entirely unconstitutional because it is in reality, but through subterfuge, a lending of the credit of the State; and in this assignment now under discussion the appellant points to the specific constitutional provisions, as mentioned. The germane portions of Article 16 of the Constitution and Amendment No. 13 thereto, as urged by the appellant, are contained in this identical language:

“Neither the State, nor any city, county, town or other municipality in this State, shall ever lend its credit for any purpose whatsoever . .

From the synopsis of the Act No. 567, as heretofore given, it is evident that the Act authorizes the organization of finance corporations under the control of the State Banking Department; and that such corporations may determine what loans and investments to make to assist in the industrial development of Arkansas. We have laws regarding State banks (§ 67-301 et seq. Ark. Stats.), which authorize State banks to make loans; but, by no stretch of the imagination can it be said that the State is “lending its credit” merely because a State bank makes a loan. We have laws regarding business corporations (§ 64-101 et seq. Ark. Stats.), which authorize business corporations to incur indebtedness; but no one could seriously urge that, because the State authorizes corporations to incur indebtedness, the State is itself liable for such debts. The Act No. 567, in allowing the organization of finance corporations, is of like effect in this regard as the State Banking Act and the Business Corporations Act. The State is not “lending its credit” merely because it authorizes the organization of a corporation which may finance industrial development corporations organized under Act No. 404 of 1955. Our holding in Halbert v. Helena, 226 Ark. 620, 29 S. W. 2d 802, is in point. We see no merit to the contention that the Act No. 567 violates Article 16 of the Constitution or Amendment No. 13 of the Constitution.

The appellant urges that the Act No. 567 violates Amendments 17 and 25 to the Constitution. The portion of these Amendments relied on by the appellant limits counties in issuing bonds; and the appellant says that these finance corporations created under the Act No. 567 occupy about the same status as the counties referred to in Amendments Nos. 17 and 25. Appellant points to our case of Williams v. Harris, 215 Ark. 928, 224 S. W. 2d 9, wherein we held that a municipal corporation could not issue bonds with the proceeds to be used for the construction of a factory building for a private corporation ; and appellant says:

“Since the public, in the form of the municipality and the county, may not aid private enterprise, the question becomes whether a private non profit corporation purporting to act for the public may do so. Act No. 567 requires that in the organization of First Arkansas each Congressional District in the State be represented by stockholders and by a director, and it must be chartered through the State Banking Department after-a finding that convenience and necessity require the existence of the corporation.
“This gives the private corporation some of the characteristics of a representative of the public acting for a public purpose. Appellant takes the position that financing a private business enterprise is not a public purpose, that a municipality or county may not support a private business enterprise, and that a private non profit corporation representing the public may not do so for them. ’ ’

This contention is easily answered. In Halbert v. Helena, etc. Industrial Development Corporation, 226 Ark. 620, 291 S. W. 2d 802, we had before us Act No. 404 of 1955, and we held that a corporation organized under that Act was a private corporation and that the Cities of Helena and West Helena were in no sense liable for the obligations of the Industrial Development Corporation. That case points to the holding here. The finance corporations authorized by the Act No. 567 are, as we have heretofore said, corporations set up to provide finances that may be loaned to development corporations organized under the Act No. 404 of 1955. The finance corporations are non-profit corporations, but their actions do not make liable the State or any of its subdivisions for the obligations of such corporations.

In the case at bar, the Scott County Industrial Development Corporation, organized under the Act No. 404 of 1955, is desirous of lending money to the Scott County Milling Company, a business corporation — just as the Helena-West Helena Industrial Development Corporation was interested in lending money to the Mohawk Rubber Company in the reported case of Halbert v. Helena {supra). In order to provide a pool or repository from which the Scott County Industrial Development Corporation, and other Industrial Development Corporations, may obtain funds to loan to business corporations — like Scott County Milling Company in the case at bar, and Mohawk Rubber Company in the reported case — the Legislature, by Act No. 567, authorized the incorporation of finance corporations — like appellee here — which, after first obtaining one million dollars of capital stock from public spirited citizens, will then be able to issue notes and bonds; and from the sale thereof are permitted to make loans to various local industrial development corporations which may qualify with worthy and worthwhile projects. The fact, that public spirited citizens of Arkansas have placed one million dollars of their personal funds into this Finance Corporation, certainly provides tangible evidence that this Finance Corporation is not a “fly-by-night” concern. It has a financial base which makes its notes and bonds supported by something “tangible”. We can see no merit to appellant’s assignment here under consideration.

II. The appellant says: “Section 19 of said Act No. 567 is in violation of the provisions of Article 16, Section 1, of the Constitution of the State of Arkansas, and is in violation of the provisions of Amendment No. 13 to the Constitution of the State of Arkansas”; and “The defendants, Orval E. Faubus, J. Vance Clayton, Jimmie Jones, Kelly Cornett, and Dick Simpson, Members of the State Board of Finance, may not legally purchase the bonds of the defendant, First Arkansas De velopment Finance Corporation.” This point in appellant’s argument brings us to the consideration of the point which caused the Court to ask for amici curiae briefs. The germane language of Art. 16 of the Constitution and Amendment No. 13 has heretofore been quoted: “Neither the State, nor any city, county, town or othei* municipality in this State shall ever lend its credit for any purpose whatsoever . . .” Section 19 of the Act No. 567 reads in part: “PURCHASE OF BONDS BY THE STATE. In addition, to the securities of the character which it is now authorized to purchase and hold in the Securities Account, the State Board of Finance may, in it discretion, purchase, at a price not to exceed par and accrued interest, bonds of any development finance corporation organized under the provisions of this Act to the extent of Five Million Dollars ($5,000,000.00); . . .” (Emphasis supplied.)

The appellant most forcibly urges that under this Section the State Board of Finance is given “carte blanche” to invest State funds in the bonds and notes issued by the Finance Corporation; and that what the State may not do directly within the inhibition of the Constitution, it certainly should not be allowed to do indirectly by “raiding” the State Treasury to provide funds for industrial development. Our attention has been called to the history of some of the States in the era of Railway Construction. The States either issued their obligations to allow the building of railroads, canals, and other projects or purchased the corporate stock of such concerns: and the effects were almost to bankrupt such States. Appellant says that it was in the light of such experience that the framers of the Constitution of 1874 used the language in the opening sentence of Sec. 1 of Art. 16, as herein involved. Our attention is called to the following classical language, contained in an annotation in 152 A. L. R. 495:

“ ‘Early in the nineteenth century it seems to have been the general practice of states to encourage the building of railroads by permitting the state or a subdivision thereof to purchase stock in railroad corporations, to issue bonds, or lend credit in aid of railroads, or to make outright donations to them. However, due to the large number of insolvencies of railroads, caused by frauds or economic conditions, states and subdivisions thereof found themselves largely indebted, and were themselves occasionally insolvent because of large investments in such enterprises. Therefore a reversal of policy set in. As early as 1851 Ohio adopted a constitution containing a provision prohibiting stock subscriptions or other forms of aid to corporations. In the ensuing twenty-five years most of the other states adopted similar provisions, either prohibiting aid altogether or requiring a vote of the people before a subscription to stock or other sort of aid could be made or extended. At present, at least thirty-eight states have such constitutional provisions, and several have statutory provisions on the subject.’ ”

Furthermore, our attention is directed to the case of Cobb v. Parnell, 183 Ark. 429, 36 S. W. 2d 388, which authorized a commission to issue bonds in the sum of $1,500,000.00 pledging the full faith and credit of the State to finance farmers and stock raisers, and it is pointed out to us that in the reported case there was language which indicated that it was a borderline emergency drouth relief proposition, or otherwise the legislation could not have been sustained. "We have carefully studied these matters; and also, we have studied the financial report of the Comptroller for the past several fiscal years to ascertain the amount in the Securities Account and the type of securities purchased by the State Finance Board.

After weighing all the factors in the matter, we reach the conclusion that the appellant’s objections, to § 19 of the Act, are not well taken. Section 19 does not re quire the State Board of Finance to purchase any bonds or notes of any finance corporation: it merely authorizes the Board, in its discretion, to purchase notes and bonds of a finance corporation organized under Act No. 567 if the Board decides that the securities are worthwhile. The Act says that the bonds and notes issued by a finance corporation (which has a foundation of one million dollars in cash) may be considered as securities in which the Board may invest a portion of the State’s Surplus Security Fund. In Halbert v. Helena (supra), we said:

“Whether the State Board of Finance invests the State’s surplus in one kind of bond or another is a matter for the Legislature to permit, and for the State Board of Finance to then decide in the exercise of its discretion. Certainly the Legislature can determine what kind of securities can be purchased by the State Board of Finance in its discretion, and until it is shown — and it has not been so shown here — that the State Board of Finance has abused its discretion or that such investment impairs the State’s ability to pay outstanding obligations as they mature, then no case is made by the appellants under this point.”

We reach the conclusion that the appellant cannot prevail on the assignment listed in this topic.

III. The appellant says: ‘ ‘ Defendant, First Arkansas Development Finance Corporation, is not validly organised under the provisions of Act No. 567 of- the Acts of the General Assembly of the State of Arkansas of 1957”; and “The defendant, First Arkansas Development Finance Corporation, is without authority to issue and sell bonds under said Act No. 567”. A considerable portion of the record in this case concerns these assignments, which we consider academic, as far as the appellant is concerned, since we have reached the conclusion that the Act No. 567 is valid. In answer to these allegations, the Finance Corporation has attached a list of all of its stockholders, subscribers, and directors; has filed the Certificate of the Bank Commissioner of the State of Arkansas granting the preliminary approval on July 8, 1957; the findings of the State Banking Board on August 6, 1958; and the Certificate of Incorporation issued by the State Bank Commissioner on August 6, 1958. The Finance Corporation is desirous of showing that every requirement had been carefully fulfilled in its organization, which probably is true. Our attention has not been directed to any alleged irregularity in the corporate organization. But, even so, after considerable study, we have reached the conclusion that the appellant is not in any position to raise the questions in this assignment.

The appellant has not alleged that he is a stockholder in the Finance Corporation, or has ever had any business dealings with the corporation, or that the corporation has ever made any claims of any kind against him. So we see no reason why he is entitled to a declaratory judgment as to the legality of the existence of the Finance Corporation. As a citizen, resident, and taxpayer, he could question the constitutionality of the Act; but as a citizen, resident, and taxpayer he has no right to question the corporate existence of the Finance Corporation through declaratory judgment proceedings. The usual rule is that the State may proceed by quo warranto to test corporate existence; but, in the case at bar, the Attorney General says that Finance Corporation is validly organized. In 13 Am. Jur. 206, “Corporations” § 61, the rule is stated:

“If the state, which alone can grant the authority to incorporate, remains silent during an open and notorious assertion and exercise of corporate powers, an individual will not, unless there is some powerful equity on his side, be permitted to raise the inquiry. The individual cannot create the corporation or grant, define, or limit its powers, and no grant of these by the sovereign can lessen his rights. There can consequently be no cause of complaint by the citizen, and no right to inquire whether corporate existence is rightful ele jure, or merely color-able. It would produce endless confusion and hardship, and probably destroy the corporation, if the legality of its existence could be drawn in question in every suit to which it was a party, for then no judgment could be rendered which would finally settle the question. ’ ’

Our declaratory judgment act (§ 34-2501 et seq. Ark. Stats.) was not intended to allow any question to be- presented by any person: the matters must be justiciable. In Anderson on “Declaratory Judgments” 2nd Ed. § 187, the general rule is stated as to declaratory judgments:

“Since purpose of the declaratory relief is to liquidate uncertainties and interpretations which might result in future litigation it may be maintained when these purposes may be subserved. The requisite precedent facts or conditions, which the courts generally hold must exist in order that declaratory relief may be obtained, may be summarized as follows: (1) There must exist a justiciable controversy; that is to say, a controversy in which a claim of right is asserted against one who has an interest in contesting it; (2) the controversy must be between persons whose interests are adverse; (3) the party seeking declaratory relief must have a legal interest in the controversy; in other words, a legally protectable interest; and (4) the issue involved in the controversy must be ripe for judicial determination.”

In the same authority in § 221 at page 488 the rule is stated:

“The Declaratory Judgment Statute is applicable only where there is a present actual controversy, and all interested persons are made parties, and only where justiciable issues are presented. It does not undertake to decide the legal effect of laws upon a state of facts which is future, contingent or uncertain. A declaratory judgment will not be granted unless tbe danger or dilemma of tbe plaintiff is present, not contingent on tbe happening of hypothetical future events; tbe prejudice to bis position must be actual and genuine and not merely possible, speculative, contingent, or remote.”

In tbe light of all of tbe foregoing, we conclude that tbe appellant has shown no reason for asking any court to decide the corporate status of tbe appellee. When we bold tbe Act valid — as we do — tbe appellant has obtained all tbe answers be is entitled to receive in this declaratory judgment proceeding. Accordingly, we modify tbe decree by cancelling tbe attack on the corporate existence of Finance Corporation, and we affirm tbe decree in bolding Act No. 567 of 1957 to be valid.

George Bose Smith, J., not participating.

Ward, J., concurring.

Bobinson and Johnson, JJ., dissenting.

Paul Ward, Associate Justice,

concurring.

I concur in tbe result reached by tbe majority but I do not agree with a vital portion of the reasoning by which that result as achieved. , .

First, however, let me state briefly my reasons for upholding Act No. 567 of 1957. I base it entirely on tbe language and reason given by this Court in tbe case of Halbert v. Helena, 226 Ark. 620, 291 S. W. 2d 802, where we said:

“Section 34 of Act 404 authorizes tbe State Board of Finance ‘in its discretion’ to purchase from local development corporations fifty per cent of tbe principal amount of tbe bond issue up to a certain amount. Tbe State is certainly not lending its credit to tbe local development corporation when it purchases bonds and receives the bonds . . . Whether tbe State Board of Finance invests tbe State’s surplus in one kind of boad or another is a matter for tbe Legislature to permit, and for the State Board of Finance to then decide in the exercise of its discretion. Certainly the Legislature can determine what kind of securities can be purchased by the State Board of Finance in its discretion . . .”

So it is plain that Act 567 purports here to authorize exactly what we approved in the cited case.

I am fearful, however, of certain language and reasoning found in the majority opinion. The majority opinion states that Act 567 “does not require” but “merely authorised” the State Board of Finance to purchase bonds. Thus the majority seem to say that no matter how unconstitutional any activity is, it becomes constitutional if the Legislature merely authorizes it to be done and does not require it to be done. A few illustrations will demonstrate the danger and fallacy of this reasoning. Our Constitution, Art. 2, Sec. 3 guarantees a trial by jury: Aft. 2, Sec. 16 prohibits imprisonment for debt; Art. 2, Sec. 26 prohibits a religious test for voting; Art. 5, Sec. 20 says the State shall not be made a party defendant ; Art. 14, Sec. 2 prohibits school money from being used for any other purpose, yet who would dare defend the constitutionality of an Act of the Legislature which permitted the violation of those guarantees? One of the best recognized rules of jurisprudence is to the effect that an Act must be judged by what it permits to be done.

The majority is confusing a constitutional question with a question of propriety. To illustrate: The State has constitutional authority to place its surplus funds in a bank for safe keeping until they are needed for operational purposes but an Act requiring it to keep them there would be void. In other words an act of the Legislature could not disrupt the governmental processes. So, what makes Act 567 constitutional is not the single word authorise but it is the character of the entire transaction which we approved in the Helena case.

Jim Johnson, Associate Justice,

dissenting.

It is regrettable when one member of the Court is unable to concur with the majority upon such an important and far reaching question as is here involved. My love for Arkansas and for future financial stability will not allow me to do otherwise. I am convinced that the majority opinion will open wider the flood gates for the enactment of future legislation based upon the Court’s stamp of approval given Act 567 of 1957, this Act being the result of the stamp of approval given a similar act which was 401 of 1955, the same being sanctioned by this Court on June 25, 1956, in the case of Halbert v. Helena-West Helena Industrial Development Corporation, 226 Ark. 620, 291 S. W. 2d 802. Unless every possible precaution is taken to resist the temptation of further expansion of the trend to deplete the State Treasury, set by the approval of these two Acts, there can be but one of two alternatives — higher taxes or bankruptcy of the State, neither of which will be attractive to new industry. Such an eventuality, of course, would defeat the original laudable intent of these very acts which was to attract industry to Arkansas in the first place. To verify the fact that states can find themselves in such a predicament, one needs only to look to the States of Michigan, Massachusetts, Minnesota, and Ohio, to name a few who are, even in these times of abundance, faced with such a catastrophe. In fact, there are still a number of people on the State payrolls who recall the earily thirties here in Arkansas when it was necessary for them to discount their meager checks or warrants in order to feed their families.

Most of us are aware of the crying necessity of attracting industry to Arkansas. The fact that we are blessed with an abundant water supply, an abundant electrical and fuel supply at reasonable rates, the best climate in the country, and an abundant supply of the most competent and willing laborers in America should be enough, with the dedicated efforts of the Chambers of Commerce and other similar organizations, to attract industry. This combination standing alone is responsible for the location of the vast majority of the financially stable industries in Arkansas today. As a general rule, industry that requires subsidizing is not the most desirable citizen to be found. The Act here under consideration and its predecessor were, no doubt, a result of the legislature’s desire to speed up the industrialization process, but even the legislature must have recognized the shaky constitutional grounds these acts were on when in the same session Act 567 was passed, the 1957 General Assembly by House Joint Resolution No. 23 submitted to the people for their consideration a proposed constitutional amendment, the first section of which reads as follows:

“Any city of the first or second class, any incorporated town, and any county, may issue, by and with the consent of the majority of the qualified electors of said municipality or county voting on the question at an election held for the purpose, bonds in sums approved by such majority at such election for the purpose of securing and developing industry within or near the said municipality holding the election, or within the county holding the election. ’ ’

The people, recognizing that this Amendment would give them a voice in obtaining the industry they desired to finance and place the financing of the same on a solid foundation without possible impairment to the financial stability of the State, adopted Amendment No. 49 by a substantial majority, the vote being 166,303 for and 87,793 against.

There can be little argument but that this amendment more than adequately meets the need for this type of legislation in Arkansas, and completely removes the validity of any contention that Act 404 of 1955 and Act 567 of 1957 were of such a public purpose that they would justify repealing by court decision the constitutional prohibition against lending the State’s credit for any purpose.

Reviewing the record and briefs in this case, I believe that even the majority will agree with me when I say that this has been, to say the least, a friendly lawsuit. The appellees wanted to win and the appellant apparently didn’t mind losing. As a result of this friendly situation the Court requested submission of Amicus Curiae briefs. We received only two responses to this request and as fate would have it both of these responses were in favor of appellee. Consequently the views expressed here are substantially my own and not particularly those of appellant.

The majority opinion says that “The finance corporations are non-profit corporations, but their actions do not make liable the State or any of its subdivisions for the obligations of such corporations.” Section 24 (1) of the Act is as follows:

“A development finance corporation organized under the provisions of this Act shall not lend money when credit is readily available elsewhere. Before granting a loan, the directors of the corporation shall endeavor so far as is reasonably possible to ascertain that the first opportunity to grant the loan has been given to the banks, the insurance companies, and to the other lending institutions of the State.”

This section clearly provides that loans will be made only to those persons, firms or corporations who cannot obtain financing elsewhere. After they are found unworthy by established lending institutions they then become prime prospects to receive State money through these corporations which were created for the sole purpose of lending the State’s credit. If established institutions won’t lend these prospects money, how can we be assured that they will repay the money they receive from the taxpayers of Arkansas through these corporations. Therefore, the question ceases to be whether or not the State will be liable for tbe obligations of the corporations but instead becomes a question of whether or not we can get our money back. The majority answers these questions as follows:

“The fact, that public spirited citizens of Arkansas have placed one million dollars of their personal funds into this Finance Corporation, certainly provides tangible evidence that this Finance Corporation is not a ‘ fly-by-night ’ concern. It has a financial base which makes its notes and bonds supported by something ‘tangible’.”

Now let’s examine the Act and see just how “tangible” the million dollar financial base really is — $100,000 of this million was put up by the purchase of capital stock; $900,000 of this money was put up by the purchase of preferred stock. Section 15 of the Act is as follows:

“The outstanding preferred stock of a corporation authorized and issued as provided in this Act shall be retired from time to time from the proceeds received by the corporation from the issuance and disposal of its debentures, as provided in this Act, and until all of the issued and outstanding preferred stock of the corporation shall have been retired, all proceeds of the corporation received from the issuance and disposal of its debentures must be used for the retirement of the outstanding preferred stock of the corporation. Such preferred stock shall be retired by lot, and the procedure for determining the preferred stock so to be retired and for its retirement may be provided in the by-laws of the corporation. Preferred stock of the corporation retired as herein provided shall be cancelled and shall not be re-issued.”

This section of the Act provides that the preferred stockholders shall receive their $900,000 back first. When this has been accomplished, the only base left will be tbe money from tbe sale of capital stock wbicb is far from a million dollars.

The gravamen of this lawsuit is whether or not Act 567 and particularly Section 19 thereof violates the provisions of Article 16, Section 1, and Amendment 13 of the Arkansas Constitution. The constitutional provision in question provides: “Neither the state nor any city, county, town or other municipality in this state shall ever lend its credit for any purpose whatever.” (This section of the Constitution was amended by Amendment No. 49 removing cities, counties, towns and municipalities from the prohibition contained therein thereby leaving it applicable only to the state.)

Section 19 of Act 567 is as follows:

“In addition to the securities of the character which it is now authorized to purchase and hold in the Securities Account, the State Board of Finance may, in its discretion, purchase, at a price not to exceed par and accrued interest, bonds of any development finance corporation organized under the provisions of this Act to the extent of Five Million Dollars ($5,000,000); provided, however, that after any development finance corporation organized under the provisions of this Act has issued and has outstanding its bonds in the principal amount of Five Million Dollars ($5,000,000), including any bonds purchased by the State Board of Finance as herein authorized, the State Board of Finance may, in its discretion, purchase, at a price not to exceed par and accrued interest, additional bonds of such development finance corporation issued in excess of the first Five Million Dollars ($5,000,000) of such bonds, but not to exceed fifty per cent (50%) of the principal amount of any such additional bonds issued by the development finance corporation within its limitations, as authorized in this Act. In its purchase of bonds in excess of Five Million Dollars ($5,000,000), if it shall elect to purchase any of the bonds of a development finance corporation, the State Board of Finance shall make such additional purchases only concurrently with other purchasers and only to the extent of their purchases. The State Board of Fi-. nance may not purchase any bonds of a development finance corporation in the secondary market.
“Interest received on all such bonds purchased by the State Board of Finance and held in the Securities Account shall be special revenues and shall be credited to the Securities Reserve Fund. Proceeds of the sale of any such bonds by the State Board of Finance shall be available for re-investment in additional bonds of the character herein authorized.
«< prior t0 the purchase of any bonds of a development finance corporation organized under the provisions of this Act, there shall be furnished to the State Board of Finance, without cost to it, the opinion of legal counsel acceptable to the Board, approving the validity of the issue and reciting that in the opinion of counsel the bonds to be purchased by the State Board of Finance are the direct general obligations of the corporation, secured by a first and valid lien on the entire assets of the corporation. ’ ’

The majority opinion places great weight on the fact that the Act provides that the State Board of Finance may, in its discretion, spend seven and one-half million dollars of the State’s money and in the same breath, in effect, concedes that if the Act had required the investment of money from the State’s Security Account in these bonds, then the conclusion would be inescapable that the Act was a lending of the State’s credit. As hard as I may try I am unable to see the logic of this reasoning. Whatever discretion the State Board of Finance has was delegated from the Legislature. The question therefore is, does the Legislature have the power to lend the State’s credit? If not, how could they delegate that power they do not possess? Does the difference in the words require and may cause the act of purchasing at all any less a lending of the State’s credit? The act of lending is the test, whether it be mandatory or permissive. Would the majority say that there is a difference in lending one dollar of the State’s money as opposed to lending seven and one-half million dollars, I am convinced that the majority would concede without hesitation that the State Board of Finance could not lend money from the State Treasury directly to Scott County Milling Company, a private corporation, yet they are saying in the majority opinion that it is alright to lend them the same money if it passes through the hands of two straw corporations before it gets to them. Certainly I say that the result of such logic, whether the words may or require are considered, permits the State to do by indirection the very thing it could not directly do, a theory which has been consistently condemned by this Court.

In contending that the purchase of bonds of the First Arkansas Development Finance Corporation by the State Board of Finance, as authorized by Section 19 of Act 567 of 1957, amounts to a lending of the State’s credit and is prohibited by Art. 16, Sec. 1 of the Constitution of Arkansas, I attempt to give consideration to every aspect of the case.

A “Bond”, as applied to finances and the sense in which here employed, is defined by Webster’s Dictionary (2 Ed.) as “A bond made by a government or corporation as an evidence of debt, usually for the purpose of borrowing money; also, any one of a series of instruments evidencing an integral part of such a debt, as a $1,000 Liberty bond . . .”

Since a bond is nothing more than a loan of money upon a promise to pay, the question may be asked; “Is not every purchase of a bond by a state a loan of the state’s credit?” The answer is no, so long as the underlying and activating purpose of the transaction and the financial obligation incurred are for the state’s benefit. In Almond v. Day, 197 Va. 782, 91 S. E. 2d 660, where a lending of credit was under consideration it was said:

“Use of the State’s funds for purchase of securities for the State’s benefit is not an extension of ‘credit’ which poses any threat to the financial security or welfare of the State. Extending its credit to aid and promote private enterprise was the evil from which the State had suffered financially. The potential danger incurred in lending credit to foster and promote the interests of those who had no rightful claim, in justice or in morals, to the State’s help or relief was the evil to be arrested. When the underlying and activating purpose of the transaction and the financial obligation incurred are for the State’s benefit, there is no lending of its credit though it may have expended its funds or incurred an obligation that benefits another. Merely because the State incurs an indebtedness or expends its funds for its benefit and others may incidentally profit thereby does not bring the transaction within the letter or the spirit of the ‘credit clause’ prohibition.”

What then is the purpose for the purchase of the bonds in question? Section 13 of the Act (567 of 1957) provides: ‘ ‘ The purposes of each development finance corporation organized under the provisions of this Act shall be to promote, stimulate, develop and advance the business prosperity and economic welfare of the State of Arkansas and its citizens; to encourage and assist through loans, investments, or other business transactions, in the location of new business and industry in this State, and to rehabilitate and assist existing business and industry . . . and to provide financing for the promotion, development and conduct of all kinds of business activity in this State . . . ”

In Section 29, the emergency clause, it is said:

“It has been found and it is hereby declared by the General Assembly of the State of Arkansas that the State of Arkansas has had heretofore an inadequate program for financing the agricultural, industrial and economic development of the State and of its several sections, that on account of such inadequate program, the State of Arkansas has been unable to provide for its inhabitants sufficient opportunities in agriculture and industry, that on account thereof the State of Arkansas is threatened with a decreasing standard of living for its inhabitants,, that unless an adequate program for financing the-agricultural, industrial and economic development of the State be immediately undertaken, the State of Arkansas will suffer immediate and irreparable loss in population and the opportunity for agricultural and industrial expansion . . .”

In determining whether the purpose of the purchase-of the bonds in question — i.e. “to provide financing for the promotion, development and conduct of all kinds of business activity in this State” — contravenes the prohibition against the lending of the State’s credit, I look to the reasons for the placing of such a constitutional limitation.

In Cobb v. Parnell, 183 Ark. 429, 36 S. W. 2d 388, this Court in pointing out the evils to be avoided by the restriction said:

“The State had just been liberated from the domination of alien adventurers who, under the guise of fostering the industries of the State by lending to them credit, had looted the treasury. A notable example of unwarranted and improvident loans of the State’s credit was the aid given to the building-railroads. That it was only to prevent a recurrence of this that Sec. 1, Article 16, was adopted was apparent from the fact that at the first session of the Legislature after the adoption of the Constitution of which Article 16 is a part, the Legislature passed an act providing for the issuance of bonds . . .”

In Almond v. Day, supra, the Supreme Court of Virginia in pointing out the evils which brought about a similar restriction said:

“Prior to adoption of Sections 12, 14 and 15 in the Constitution of 1869, the State of Virginia had freely extended its credit and aid to corporations engaged in works of internal improvement. In 1816, the General Assembly created ‘ The fund for Internal Improvement,’ and incorporated a ‘Board of Public Works’ to administer the fund. Acts 1816, ch. 17, p. 35. Subsequent acts of the General Assembly show that through this Board large sums of money were loaned or advanced by Virginia to various corporations engaged in developing and operating privately owned works of internal improvements, such as canal, turnpike and railroad companies, that held promise of public benefit. Financial obligations in vast sums were incurred by the State, and its credit was freely but often unwisely extended to foster these enterprises by purchase of their bonds and stock, or through guarantee of their obligations and indebtedness. This was done with the hope and expectation that the enterprises would thrive and bring to the areas served business prosperity and to the State at large public benefit.
“The magnitude of the obligations incurred by the State, and the amount of money lost by .lending its credit and financial aid to such enterprises may be ascertained from an historic report of J. D. Imboden, entitled ‘Early History of Transportation in Virginia’ in Vol. 17, page 5. House Executive Documents, 2nd Session 49th Congress, 1886-87. At page 75 of this report it is stated that the State’s railroad losses, which included its losses incident to the James Diver and Kanawha Canal, amounted to over $26,-000,000. See also Pearson: The Deadjuster Movement in Virginia, Chapter I; McDaniel: The Virginia Constitutional Convention of 1901-1902, at page 59; and Virginia Magazine of History and Biography, Vol. 59 (1951), page 423, et seq.
“This condition was not peculiar to Virginia. Decisions from other states, construing similar restrictive provisions in their constitutions, show that those states had extended aid to enterprises of like nature and that financial obligations and losses thus incurred to foster and promote works of internal improvement brought about the adoption of their restrictive constitutional provisions. Descriptive of the practices engaged in by the states and informative of the unfortunate results experienced by many is the following statement in 152 A.L.R. p. 495:
“ ‘Early in the nineteenth century it seems to have been the general practice of states to encourage the building of railroads by permitting the state or a subdivision thereof to purchase stock in railroad corporations, to issue bonds or lend credit in aid of railroads, or to make outright donations to them. However, due to the large number of insolvencies of railroads, caused by frauds or economic conditions, states and subdivisions thereof found themselves largely indebted, and were themselves occasionally insolvent because of large investments in such enterprises. Therefore a reversal of policy set in. As early as 1851 Ohio adopted a constitution containing a provision prohibiting stock subscriptions or other forms of aid to corporations. In the ensuing twenty-five years most of the other states adopted similar provisions, either prohibiting aid altogether or requiring a vote of the people before a subscription to stock or other sort of aid could be made or extended. At present, at least thirty-eight states have such constitutional provisions, and several have a statutory provision on the subject.’ ”

In Cobb v. Parnell, supra, this Court had before it Act No. 10 of 1931 as amended by Act No. 34 of 1931. By this legislation a board was created consisting of the Governor, the Auditor of State, the Chairman of the Highway Commission, and seven others, designated as the State Agricultural Credit Board. These acts empowered said board to issue bonds in the sum of $1,500,000, for which the full faith and credit of the State was-pledged, for the purpose of financing farmers and stock raisers for agricultural purposes. The loans were to be made by finance corporations, already organized and to be created under the supervision of the State Agricultural Credit Board according to rules prescribing the conditions under which the loans were to be made to the-farmers and the manner of repayment. A general annual tax of one-half mill was levied to pay for the bonds.

After reviewing the authorities and setting out the-guiding principles as I have attempted to do herein, this question was asked? “Is the purpose and effect of the act now before us a loan by the State of its credit to foster individual enterprises, or is it one which has for its end the accomplishment of a purpose which will secure the State from a general threatened evil and promote the welfare of its citizens? In other words, is it for .a public purpose?”

After reviewing the circumstances which called the -act into existence — such as the great drought that prevailed in the state throughout the entire growing season <of 1930 and the unprecedented economic depression then raging — the court speaking through Mr. Justice Butler ■said;

“. . . where a law is enacted for relief from certain starvation and probable disease, certainly it, too, must be but the use of the State’s credit for a ■public purpose. This we so hold as consonant with fhe impulses of common humanity and natural justice, our conclusions finding support in the authorities we have cited and reviewed. The doctrine announced in this case has no application except in •cases where the calamity is certain and irremediable in its nature and general in its scope.”

Thus when viewed in the light of the reasons for placing this constitutional restriction on the Legislature, the decisions of this and other courts, I would be compelled, with due deference to, and respect for my colleagues, to hold that Section 19 of Act 567 is void in so far as it permits the State Board of Finance to purchase bonds of the First Arkansas Development Corporation. To the same effect see: In re Opinion of the Justices, 99 N. H. 528, 114 A. 2d 514; contra, City of Frostburg v. Jenkins, 215 Md. 9, 136 A. 2d 852. I can see little difference between the public good claimed by the proponents of this legislation and that claimed by those who sought aid for the railroads, nor any supposed emergency as existed in the case of Cobb v. Parnell, supra. If the majority opinion is allowed to stand it will strike a terrific blow to private enterprise, a system under which this country has thrived and prospered.

If Scott County Milling Company is permitted to borrow money from the State Treasury for the establishment of private enterprise how could the majority in the future deny the same privilege to any person or private corporation which employs or intends to employ capital or labor. Would not the merchant, the mechanic, the innkeeper, the banker or the builder be equally deserving of the favors of the state.

Is it unreasonable to conclude that such lending would open the coffers of the public treasury to the importunities of two-thirds of the business men in the State? I think not.

       We call attention to the fact that Act No. 404 of 1955 was for “Industrial Development”; and Act No. 567, now under consideration, is to provide finances for industrial development.

       In the excellent briefs submitted by the amici curiae, there have been listed the statutes and decisions from various States involving legislation along the same general lines as our Act No. 404 of 1955 or the Act No. 567 here under consideration. For statutes — most of which have not experienced court testing — see:

        Florida: Sections 289.01 et seq. of 1957 Statutes
      Hawaii: Act No. 288 of 1957
      Kansas: Chapter 144, Session Laws of 1955
      Massachusetts: Chapter 671 of the Acts of 1953
      Michigan: Act No. 158 of 1956
      Minnesota: Chapter 896, Session Laws of 1957
      New Hampshire: Chapter 254 of 1955
      New York: Chapter 863 of 1955
      Pennsylvania: Title 73, § 301 et seq. of Purden’s Statutes.
      Rhode Island: Chapter 3045 of 1953
      South Dakota: Chapter 314, Session Laws of 1957
      Vermont: Act No. 151 of 1953
      Wisconsin: Chapter 225 of Statutes of 1957
      A reading of the various statutes indicates that none is exactly similar to Act No. 567; but the statutes show that various States have been trying to encourage industrial development, either at the State, municipal, or voluntary corporation level. Up to the present, most of the litigation on the constitutionality of aid to industrial development seems to have involved legislation which allowed counties or municipalities to grant aid, and in some of those cases the question was whether such industrial development was a “public purpose”. Some of the cases are: McConnell v. City of Lebanon (Tenn.), 314 S. W. (2d) 12; Albritton v. City of Winona, 181 Miss. 75, 178 So. 799; Dyche v. City of London (Ky.), 288 S. W. (2d) 648; and Miller v. Police Jury, 226 La. 8, 74 So. (2d) 394. Some of the other cases which we have studied are: Faulconer v. City of Danville, 313 Ky. 468, 232 S. W. (2d) 80; Opinion of the Justices, 254 Ala. 506, 49 So. (2d) 175; Newberry v. City of Andalusia, 257 Ala. 629. 57 So. (2d) 629; Holly v. City of Elizabethton, 193 Tenn. 46, 241 S. W. (2d) 1001; Village of Doming v. Hosdreg, 62 N. M. 18, 303 Pac. (2d) 920; Wilmington v. Banken (Del.), 105 A. (2d) 614; and Frostburg v. Jenkins, 215 Md. 9, 136 A. (2d) 852; State v. North Miami (Fla.) 59 So. (2d) 779; State v. York, 164 Neb. 223, 82 N. W. (2d) 269; Opinion of the Justices, 99 N. H. 528. See also article, “Municipal Inducements to Private Industry”, Minn. Law Review, May 1956, Vol. 40 p. 681 et seq. and review of the article in Law Review Digest, Vol. 6, p. 83 et seq.

       Kelly Cornett was State Comptroller when this suit was filed and when appellant’s brief was prepared on appeal; but Kelly Cornett departed this life, and Julian Hogan has been substituted as the Acting State Comptroller.

       In a per'curiam order of even date we have expressed appreciation to the named members of the Bar, who at our invitation .filed amici curiae briefs, all of which have proved most helpful.

       This report is a public document, as provided by § 12-1907 Ark. Stats.

       According to the Comptroller’s report of June 30, 1958, the Securities Account had slightly in excess of eighteen million dollars of securities already; so unless the finances of the State of Arkansas take a tremendous upturn, we can see no possibility of the State Board of Finance investing the maximum of seven and one-half million dollars in these Finance Corporation bonds.

       For a case from another jurisdiction reaching a like conclusion in regard to discretion in investment of State Funds, see Fairbanks v. Stratton (Illinois), 152 N.E. (2d) 569.


source: Caselaw Access Project

author: George Rose Smith, J.

license: Public Domain

text:
    House v. State.
    4943
    324 S. W. 2d 112
    Opinion delivered May 18, 1959.

      E. L. Schieffler and Charles B: Roscopf, for appellant.

      Bruce Bennett, Atty. General, by Bill J. Davis, Asst. Atty. General, for appellee.
   George Rose Smith, J.

The appellant was convicted of murder in the first degree and was sentenced to death. For a reversal he questions the sufficiency of the evidence and a number of the trial court’s rulings.

House, a man of twenty-four, and the decedent, Ernestine Coley, a girl of nineteen, were residents of Phillips county. On the afternoon of July 26, 1958, the two met on the street in the community of Oneida, and the girl solicited a ride into Helena, where one of her relatives was in a hospital. While House was waiting for the girl to change her clothes he made the statement to a friend that he was going to try to have intercourse with her.

On the way to Helena House turned down a side' road and stopped the car. In his written confession House said that he and the girl began fighting when she resisted his advances; on the witness stand he attributed the fight to a dispute over a money matter. In both narratives he says that in repelling the girl’s attack upon him with a soda pop bottle he picked up a lug wrench and struck her a single blow on the head. In his confession House stated that he didn’t know whether the girl was dead, but he rolled her into a water-filled ditch and drove away. In his testimony he says that she fell into the ditch and appeared to be dead when he left the spot.

Within a short time House changed his mind, returned to the scene, and removed the girl from the ditch. According to his confession he still did not know whether she was dead, but he drove to Long Lake, tied a heavy weight to his victim’s feet, and threw the body off a bridge. His testimony is- substantially to the same effect, except that he says that upon removing the girl from the ditch he could not feel any pulse, “and I figured she was dead, and I got scared and I couldn’t think of nothing to do bnt try to get rid of her.” Upon the discovery next day of Ernestine’s body in the Lake House was immediately arrested and made a complete confession of his guilt.

In challenging the sufficiency of the State’s evidence counsel earnestly insist that the proof fails to establish a deliberate, premeditated intention to take life. Ark. Stats. 1947, § 41-2205; Gulley v. State, 201 Ark. 744, 146 S. W. 2d 706. But deliberation and premeditation may be inferred from the circumstances of the case, Weldon v. State, 168 Ark. 534, 270 S. W. 968, and here the evidence was amply sufficient to support the jury’s conclusion that the necessary criminal intent existed.

The trampled condition of the grass near the ditch indicated that an extensive struggle had taken place. One of Ernestine’s shoes was found there, and a torn portion of her petticoat was discovered “some distance” from the shoe. The doctor who examined the body was unable to say whether death was caused by the blow, which did not fracture the skull, or by drowning, there having been water in the lungs. The jury may well have concluded either that the decedent was killed in the course of a protracted fight or that she was thrown into the ditch or lake and left to drown. There is substantial evidence to sustain either view; so the issue of deliberation and premeditation is settled by the jury’s verdict.

Several of the appellant’s arguments pertain to the admissibility of the written confession. One contention is that the court erred in permitting the introduction of this document without first conducting a preliminary hearing in chambers to determine whether the confession was voluntary. We have often said that it is the better practice for the court to conduct a preliminary hearing in the absence of the jury, Austin v. State, 193 Ark. 833, 103 S. W. 2d 56; Lee v. State, 229 Ark. 354, 315 S. W. 2d 916; but the reason for the rule is to avoid the possibility of the jury’s being prejudiced if the court rules the confession inadmissible, and hence the accused has no basis for complaint if the confession is actually admitted in evidence. Greenwood, v. State, 107 Ark. 568, 156 S. W. 427; Bullen v. State, 156 Ark. 148, 245 S. W. 493. The fact that the confession was properly admitted in evidence also answers the argument that the prosecuting attorney should not have been permitted to mention the confession in his opening statement to the jury. Mouser v. State, 216 Ark. 965, 228 S. W. 2d 472.

It is also insisted that the court failed to instruct che jury that the admission of the confession into evidence was not conclusive of the jury’s right to determine the weight that should be given to the confession. There are several defects in the appellant’s position on this point. To begin with, the proof that the confession was voluntarily given is virtually undisputed. There is no suggestion that House was subjected to prolonged questioning or to mistreatment of any kind. At the very most House intimates an expectation of leniency on his part, by saying that the sheriff told him, “I won’t promise yon nothing, but you may not go to the chair if you tell us about it.” It may be doubted whether this bare statement presented a jury question about the voluntary nature of the confession, and when there is no conflict in the testimony no instructions on the subject need be given the jury. Needham v. State, 215 Ark. 935, 224 S. W. 2d 785. Again, the accused’s confession differed so slightly from his testimony in the case that it is difficult to perceive how he could have been prejudiced by the introduction of the confession. Finally, when the document was admitted in evidence the court stated in the presence of the jury that “it is the function of the court to . . . decide whether or not the statement or alleged confession is admissible in evidence; then it is a question for the jury to determine whether or not it is worthy of belief and to decide what weight should be attached to it.” This was a correct, brief statement of the respective functions of the judge and the jury, Wallace v. State, 28 Ark. 531, and in the absence of any request whatever that the jury be more fully instructed in the matter we are unwilling to say that the court was under a duty to give a more detailed explanation on its own motion.

A related contention, that the confession was inadmissible because the accused had not been taken before a magistrate and was not represented by counsel, has been rejected in many cases. See, for example, McGhee v. State, 214 Ark. 221, 215 S. W. 2d 135, and Lee v. State, supra.

Complaint is made of the court’s action in permitting the verdict of guilty of murder in the first degree to be amended by the addition of the words, ‘ as charged in the information.” The amendment was entirely proper, as it was made before the verdict was entered of record, before the jury had separated, and after a poll of the jury had disclosed that each juror understood that the effect of the verdict was to require the imposition of the death sentence. Hamer v. State, 104 Ark. 606, 150 S. W. 142.

When the State offered the lug wrench in evidence the defense objected on the ground that the sheriff had taken it from the car without a search warrant. It is a sufficient answer to this objection to point out that the car belonged to House’s grandfather, who did not object to the search, and House is not in a position to complain that another’s rights were invaded. Underhill’s Criminal Evidence (5th Ed.), § 417.

In accordance with our practice in capital cases we have carefully reviewed the record and have examined every objection interposed by the accused at the trial. We are convinced that the appellant received a fair trial and find no error calling for a reversal of the judgment.

Affirmed.


author: Paul Ward, Associate Justice.

text:
    Harbour v. Harbour.
    5-1845
    324 S. W. 2d 115
    Opinion delivered May 18, 1959.

      Charles 8. Goldb&rger and E. W. Brockman, Jr., for appellant.

      J. 8. Brooks and M. P. Matheney, for appellee.
   Paul Ward, Associate Justice.

This is an appeal by the husband from an order of the Chancery Court fixing alimony and impounding funds in the Registry of the Court to secure payment thereof. Some phases of this case have been before us three times previously under the same case style. See opinions dated June 9, 1958 (313 S. W. 2d 830), February 2, 1959, and March 23, 1959. Therefore, we deem it unnecessary to set out fully the background facts.

On July 10, 1958, appellant, the former husband, filed a petition asking the court to reduce the monthly alimony and maintenance payments because he was unemployed and because their son was no longer living with his former wife. On the 3rd of September following, appellee, the former wife, petitioned the court to impound approximately $1,700, belonging to appellant and held in court, to insure future payments.

After hearing testimony by both sides, the trial court on October 8, 1958, reduced the monthly alimony payments from $100 to'$75, and ordered the money held in court to secure the said payments.

On appeal appellant urges two principal grounds for a reversal, viz: (a) The payments are excessive, and (b) the court erred in impounding the money.

(a) We are unable to say the trial court abused its discretion in fixing the alimony payments at $75 per month. The applicable rule is stated in Foster v. Foster, 216 Ark. 76; 224 S. W. 2d 47:

‘ ‘ This court has many times announced the rule that in fixing the amount of alimony to be awarded, a wide discretion rests with the trial court, and unless there appears to be a clear abuse in the exercise of this discretion, it will not be disturbed by this Court . .

Incidentally, this Court, in the cited case, approved $100 monthly payments where the husband’s monthly income was $315.02 after deductions. Here appellant, who is a skilled pipe fitter makes over $3.00 per hour and admits that he has been making an average of $3,500 a year. It is true that appellant had not been working for about three months before this particular litigation began, but he admits having some money in the bank to live on until he finds work, and, of course, he has the $1,700 in question. There is ample testimony to show that appellee needs the amount allotted to her. She testified that her itemized expenses amounted to $167.12 per month besides taxes and doctor bills. It also appears from the record that she has living with her a retarded son (also son of appellant) who works some but makes very little, and she states that she intends to give him a home regardless of the outcome of this suit. Appellee works six nights a week at a drive-in restaurant to supplement the alimony. Appellant has extensive bills to pay for medical and hospital expenses because of an auto collision resulting in injuries to his new wife, but he has some hospital insurance, and the prospect of receiving damages for the injuries. Under these circumstances we are ■unwilling to substitute our judgment for tbat of tbe trial court in fixing the amount of alimony.

(b) It is appellant’s position tbat (1) tbe trial court bad no authority to impound tbe money, and (2) tbat, if be did have tbe authority, be was not justified in doing so under tbe facts of this case.

(1) On tbe first point appellant cannot be sustained. Ark. Stats, dealing with divorce and alimony, Sec. 34-1212, in all material parts reads:

‘ ‘ Courts of Equity may enforce tbe performance of - . . decrees or orders for alimony and maintenance by sequestration of the defendant’s property . . . ” etc. Tbe above statute was considered in Rowell v. Rowell, 184 Ark. 643, 43 S. W. 2d 243 (C. & M. Digest 3509), and Casteel v. Casteel, 38 Ark. 477 (Gantt’s Digest 2205), and in each instance it was indicated clearly tbat tbe court bad tbe authority to sequestrate or impound tbe bus-band’s property to secure alimony payments. Other jurisdictions have held a trial court has this inherent right, even where there is no statutory authority. See: Ring v. Ring, 185 Va. 269, 38 S. W. 2d 471; Jensen v. Jensen, 144 Neb. 857, 15 N. W. 2d 57, and Maloney v. Maloney, 12 N. J. Misc. 397, 174 A. 28. See also Keezer on Marriage and Divorce, Sec. 702, citing cases.

(2) Again, we are unwilling to say tbe trial court erred in impounding appellant’s money held in tbe Court Registry. In tbe Rowell case, supra, the court indicated tbat there must be ‘ ‘ some sound reason for the order of sequestration.”

In this case we think tbe record justified tbe action of tbe trial court. At times when tbe appellant was employed he never made any payments until forced by tbe court to do so. His attitude seems to be expressed by bis own testimony when be said tbat be figured bis own interest first, tbe interest of bis new wife second, and tbe interest of bis former wife (appellee) last. Tbe record shows tbat appellee has bad to pay out legal fees in order to try to collect from appellant, and she has not been reimbursed by tbe defendant, nor has any allowanee been made by the .court. The trial Judge has had the parties before him several times and is able to better judge the attitude of the appellant and the need for insuring the payment of the monthly allotments than we are, and we are therefore unwilling to substitute our judgment for his.

Affirmed.

Johnson, J., dissents.


author: Jim Johnson, Associate Justice.

text:
    Harrison v. State Farm Mutual Insurance Co.
    5-1840
    326 S. W. 2d 803
    Opinion delivered May 18, 1959.
    [Rehearing denied September 7, 1959]

      William I. Prewett and Melvin E. Mayfield, for appellant.

      Mahony & Yocum, for appellee.
   Jim Johnson, Associate Justice.

Appellant, Aubra Harrison, filed this suit to recover from appellee, State Farm Mutual Insurance Company, on an insurance policy providing for collision coverage on a pickup truck owned by appellant.

The policy contained the following cancellation provisions :

“ Cancellation. The named insured may cancel this policy by mailing to the company written notice stating when thereafter such cancellation shall be effective.
‘ ‘ The company may cancel this policy by written notice, addressed to the insured named in the declarations and mailed to the address shown therein, stating when not less than ten days thereafter cancellation shall be effective. Such notice of cancellation shall be sufficient notwithstanding the death of the insured named in the declarations.
“The mailing of the notice shall be sufficient proof of notice and the effective date and hour of cancellation stated therein shall become the end of the policy period. Delivery of written notice shall be equivalent to mailing.
“If the named insured cancels, earned premiums shall be computed in accordance with the company’s short rate table and procedures. If the company cancels, earned premiums shall be computed fro rata. Premium adjustment may be made at the time cancellation is effected or as soon as practicable thereafter, but the payment or tender of unearned premiums is not a condition of cancellation.”

Appellee contended that the policy had been can-celled by mailing a notice of cancellation addressed to appellant. At the conclusion of all the evidence in the case the trial court granted appellee a directed verdict. Hence this appeal.

For reversal appellant urged three points,' two of which we do not here reach because of the conclusion hereafter set out. Appellant contended that “Under all the evidence in this case, the question of whether a notice of cancellation had been mailed should have been submitted to the jury. ’ ’

Appellee sought to prove that a notice of cancellation had been mailed by the testimony of Robert C. Schoenburn, an employee in appellee’s office at Murfreesboro, Tennessee. He testified by deposition taken on interrogatories and on cross-interrogatories and admitted that his testimony was not based on his own personal knowledge but only upon an examination of the company’s records. Mr. Schoenburn testified as follows:

“Our method of cancellation is by sending written notice to the insured. When a written notice is sent we make copies at the same time we make the original for the purpose of completing our file. Attached hereto and made Exhibit No. 1, to these interrogatories is the copy of the cancellation notice mailed to Mr. Aubra Harrison, 307 West Hillsboro, El Dorado, Arkansas. When a cancellation notice is mailed the party who mails the notice stamps on the copy the date the original notice was mailed and the original notice does not leave his hands until it is mailed at the post office in Murfreesboro. The attached Exhibit No. 1, shows that the original cancellation notice was mailed to Mr. Harrison June 24, 1957, notifying him of the intended cancellation date of his policy of insurance which date is July 7,1957. ’ ’

Appellant objected to this testimony as hearsay. The trial court properly overruled his objection under Act 293 of 1949, Sec. 28-928, Ark. Stats, which reads as follows :

“In any court of record of the state any writing or record, whether in the form of a book or otherwise, made as a memorandum or record of any act, transaction, occurrence or event, should be admissible as evidence of such act, transaction, occurrence, or event, if made in the regular course of any business and if it was the regular course of business to make such memorandum at the time of such act, transaction, occurrence or event or within a reasonable time thereafter. All other circumstances of the making of such writing or record, in-eluding lack of personal knowledge by the entrant or maker, may be shown to affect its weight, but such circumstances shall not affect its admissibility.”

Appellant testified relative to cancellation notice as follows :

“I have never seen the cancellation notice which you hand me and which has been introduced into evidence here. I have never seen anything like it before. I never received any kind of cancellation notice from the company. My wife, when we get the mail, takes out what is for her and puts the rest of it on the desk I have there and sometimes it gets stacked up and I go through it and see what’s in it. My wife and I are the ones that handle the mail that comes to our house. She never opens anything that comes to me but puts all the mail that is addressed to me on the desk.
“I am absolutely sure that I did not receive any cancellation notice or anything about the cancellation of my insurance. I never received any mail from the insurance company from the time I received the policy until the date of the accident.”

From the testimony relative to cancellation notice, set out in the record, we are asked to say that the evidence of mailing is so strong and convincing that reasonable men could not find otherwise. We said in W. T. Rawleigh Co. v. Moore, 196 Ark. 1148, 121 S. W. 2d 106:

“Where a letter properly and sufficiently addressed and properly stamped, was mailed, there is a presumption of fact, not of law, that the letter was received by the addressee in due course of mail, which presumption ceases to exist, where the addressee denies having received the letter, whereupon it becomes a question of fact whether the letter was written or received. ’ ’

Following our rule, in determining the correctness of a trial court’s directed verdict, the evidence must be viewed most favorable to the party against whom the verdict was directed and given its strongest probative force in that party’s favor. See: Gray v. Magness, 200 Ark. 163, 138 S. W. 2d 73, Sharp v. Sonenblick & Sklan, 213 Ark. 649, 212 S. W. 2d 18. We cannot say from the evidence presented that this was not a question for the jury.

Therefore, the judgment is accordingly reversed and the cause remanded for further proceedings.


author: Cableton Harris, Chief Justice. J. Seaborn Holt, J.,

text:
    Smith v. State.
    4945
    324 S. W. 2d 341
    Opinion delivered May 25, 1959.

      Ed Trice, for appellant.

      Bruce Bennett, Atty. General, by Bill J. Davis, Asst. Atty. General, for appellee.
   Cableton Harris, Chief Justice.

Appellant, Lawrence Smith, was charged by Information with the crime of Murder in the First Degree, it being alleged that Smith murdered Cary C. Cundiff, by shooting him with a .22 caliber rifle, “with premeditation, deliberation, and malice aforethought, and committed in the attempt to and in the perpetration of robbery of the said Cary C. Cundiff.” The court appointed reputable counsel for appellant, and pursuant to their motion filed, Smith was committed to the Arkansas State Hospital for Nervous Diseases for observation. In due time, the psychiatric staff of the hospital filed its report, finding Smith to be “without psychosis” and legally responsible at the time of the alleged crime. Smith pleaded guilty to the charge of murder, and the cause was submitted to the jury for their determination of the degree of guilt, and punishment, that should be fixed and adjudged against appellant. The jury returned its verdict, finding Smith guilty of the crime of murder in the first degree, and fixed his punishment at death by electrocution. From the judgment of the court, entered in conformity with the jury’s finding, appellant brings this appeal.

There is ample evidence in the record to support the conviction of first degree murder, either as to murder committed while perpetrating another felony, or murder committed through premeditation and deliberation with malice aforethought. The proof reflected that the deceased was a farmer, who had been plowing in a cotton field. His body was found in the field by his 15 year-old son, Charles Cundiff, who had gone to the field to-take his father’s lunch to him. S. Y. Fissell, a mortician at Eudora, testified that in embalming the body, he found six bullet holes, two on the left side of the face, one almost in the center of the head, a penetrating hole on the left side of the head above the hairline, and two in the right leg above the knee. Fissell stated that he probed the bullet hole in the head, and that it went downward into the brain. Two bullets were taken from the body and turned over to officers. S. H. Ball, deputy sheriff and constable, testified that after being notified of the killing, he went to the scene, and found the body of the deceased, lying by his tractor, at the edge of the cotton field; that upon discovering deceased had been shot, he began to look for evidence, and checked up and down the fence row. He located the place where deceased had apparently been plowing, found a lot of blood on top of the cotton, and a number of footprints, “big- shoe tracks, run down shoes. ’ ’ After finding the tracks, he, together with two game wardens, went to the home of Smith, who lived about a quarter of a mile from where deceased was found. Smith was in bed asleep, and was awakened by his grandmother. Appellant came out to the porch, and according to Ball:

“* * * as soon as I saw his shoes, I figured he might know something about it, so I had measured this track. I had me a little stick I measured the track with, but I couldn’t get up to this house and I left the stick in the car, so I went to the car and got the stick and measured his shoe track and it measured identical with the track in the field where Mr. Cundiff was killed. I started questioning him some and searched him, and found two .22 caliber bullets in his pocket and found two $10 bills, one five and four ones, with blood on them in his pocket. Then I asked him did he kill Mr. Cundiff and he said he did. I asked him what did he do with the gun and he said be took it back to bis grand-daddy’s bonse. Then I arrested bim and took bim out to Eudora, and Mr. Walton Matbis and me took bis confession. * * * ”

After taking tbe confession, Smith was interrogated as to what be did with the pocketbook, and appellant stated that be bid it in tbe woods back of where be lived. They then drove back out, and Smith took them about 50 yards from tbe road where tbe pocketbook, which bad belonged to deceased, was found. Ball also testified that tbe gun was found where Smith told them it was located. Tbe officer testified that most of tbe details of tbe killing were related to bim at tbe bouse, though some were added at tbe jail. H. B. Boutt, a state game warden, who accompanied Ball to tbe field and bouse, was present when Smith made bis oral confession to Ball, and verified Ball’s testimony. Walton Matbis, city marshal of Eudora, testified that be was present when tbe confession was reduced to writing; that be (Matbis) typed tbe confession; that no one threatened appellant or mistreated bim in any manner, nor was Smith promised any leniency; that appellant was told the confession would likely be used against bim. Smith signed all three pages of the confession.

Tbe statement made by Smith related tbe following pertinent facts . . . that be was 18 years of age . . . had lived with bis grandparents since be was one year old . . . bis grandfather bad promised that be would buy Smith an automobile when be (Smith) got out of tbe penitentiary in February, 1958, . . . tbe grandfather told bim that be had changed bis mind . . . appellant was lying in bed thinking about bow be was going to get an automobile . . . got up and went out on tbe porch and saw Cundiff crossing tbe field, plowing bis cotton with a tractor, and tbe thought bit bim that be could take enough money from Cundiff to get a second-handcar . . . took bis grandfather’s .22 rifle, which was loaded, and went across tbe field to where Mr. Cundiff was plowing, and told tbe latter to give bim bis money . . . Cundiff told bim to “go on” . . . and appellant responded that if Cundiff would give him the money, “It wouldn’t be nothing” . . . Cnndiff got off the tractor with a hammer in his hand and Smith fired the .22 rifle, striking the farmer . . . Cundiff went behind the tractor and Smith advanced and started shooting as Cnndiff was dodging around behind the tractor . . . some of the bullets hit the fender and radiator . . . the gnn jammed and Smith ran across a slough . . . Cnndiff got back on the tractor and started toward his home, bnt seeing Smith, cut toward him ... he cut too short and the wheels slid, and the tractor stopped . . . Cnndiff got off the tractor with his billfold in one hand and some money in the other and said “Come and get it” . . . appellant replied, “No, give the billfold to me” . . . ‘He said’, “I don’t want to give yon the billfold” . . . Smith then fired and Cnndiff fell to the ground, following which appellant walked over, took the money and billfold . . . Cnndiff was gasping for breath . . . Smith went back to his house and put the gnn in the trunk . . . then went to a thicket back of his house and threw the billfold into it . . . then got his hoe and helped his grandmother hoe ... he obtained $29 . . . four one dollar bills, two ten dollar bills and one five dollar bill . . . some of the bills and the billfold were bloodstained . . . “I had already noticed blood on the money before they got me, and when they showed it to me, I knew they had the proof on me, and I then told them the truth that it was the money I took from Mr. Cnndiff.” From the confession:

“I have made this statement realizing that it may be used against me in prosecuting this case against me. I have made it of my own free will and without threat or promise from any one of the officers. I would not have shot Mr. Cnndiff if he had given me the money when I ask him for it. * # *”

He stated that after shooting Cnndiff the first time, he decided to kill him, so that no one “would know who did it.”

On trial, Smith took the witness stand, admitted that he had signed the confession, bnt when asked why he killed deceased, replied, “I do not know how come I done it.” He stated that the prosecuting attorney had correctly read his confession, and that he remembered all that he had said which had been placed in the confession . . . that he remembered well what happened the day of the slaying and that he knew what was taking place. He stated that, as a small boy, he was hit in the head by a piece of iron, and that “At times I don’t know where I am going when I be walking, don’t know where I am going. At times I do and at times I don’t. * * * When I have the blind staggers, I will be sitting down or lying down, some kind of dark cloud comes over my face. Then if I walks off, I will fall off, and I will later come back to myself.” Further: “I will be sitting down and I hear somebody talking to me and I know nobody will be around. Somebody will speak to me and I can’t see anything; and I will be sitting down and somebody will talk to me * * *. I will be sitting down and I will hear voices calling my name, be talking, and I couldn’t see them. At times I be sitting down and somebody touch me and I couldn’t see them.’’ When asked whether he was in possession of his faculties when he killed Mr. Cundiff, the witness replied, “I don’t think so. If I had been I wouldn’t have did it.”

Appellant’s motion for new trial contains eight assignments of error, and various objections were made during the trial to the introduction of evidence. The first three assignments deal with sufficiency of the evidence (heretofore discussed). Assignment four cites as error the action of the court in permitting the witness, Steve Ball, to testify in detail about the oral confession made to him by appellant soon after the killing, for the reason that Ball had not advised Smith of his constitutional rights against self-incrimination. We have several times held that the failure to warn or caution the accused that his statement would be used against him does not, of itself, render the confession, or statement made, incompetent. Greenwood v. State, 107 Ark. 568, 156 S. W. 427, Dewein v. State, 114 Ark. 472, 170 S. W. 582, Henry v. State, 151 Ark. 620, 237 S. W. 454.

By assignment No. 5 and objections made during the trial, error is alleged in permitting Ball to testify concerning an additional oral statement made by appellant after Smith’s confession had been reduced to writing The additional statement made was explained by Ball in his testimony as follows:

“Q. Did the defendant give you any further information?
A. He did.
Q. Tell the jury what that information was.
A. He told me after we had brought him to Lake Village and put him in jail, I went back to Eudora and went to the funeral home and viewed the body of Mr. Cnndiff with the undertaker and this bullet was fired in the head here in the forehead and ranged down, and then I came back to Lake Village and talked to Lawrence again about the shooting, about the shot in the head and the bullet ranged down, and I explained to him, and then he said after he shot him and he fell to the ground, then he walked up behind him and put the gun about this far from his head and shot him in the forehead (indicates about two feet), that he was lying on his back and shot him again.”

This Court has held that any voluntary admission that tends to connect a defendant with a crime charged, is admissible. McMillan v. State, 229 Ark. 249, 314 S. W. 2d 483. The fact that the additional statement was made after the written confession does not make such statement inadmissible. Of course, it was the duty of the jury to determine the degree of the crime, and the above evidence was certainly admissible as tending to show premeditation and deliberation.

It is argued that the court erred in allowing the deceased’s hat, bloodstained money, and the .22 caliber rifle to be introduced in evidence, as well as permitting witnesses to testify about the number of shots fired into the body, and the detailed description of the shot fired into Cnndiff’s head. Counsel contend that this evidence was unnecessary, as appellant had pleaded guilty, and the testimony and exhibits conld only serve to inflame the jury. We do not agree. The charge filed by the prosecuting attorney included both murder in the first degree committed after premeditation, deliberation and with malice aforethought, and also murder committed in the perpetration of robbery. All of this evidence was therefore admissible. The rifle and bloodstained money supported the charge of murder committed in the commission of the robbery. The hat (which was still on the head of deceased when the body was found and which had two bullet holes in it), and the testimony complained about, were pertinent facts to be considered in the charge of murder committed with premeditation. In Rorie v. State, reported in 215 Ark. 282, 220 S. W. 2d 421, appellant was convicted of murder in the first degree and sentenced to death by electrocution. Rorie had been estranged from his wife. ‘ ‘ On the night of October 8,1948, he went to her home when she was alone with her two small children. When she refused to become reconciled with him, he struck her on the head with a hammer, and either killed her or knocked her unconscious. Then he sprinkled kerosene over the bed where she and her two sleeping children (his step-children) were lying. He set fire to the bed and departed.” On leaving the premises, Rorie heard the children scream and he observed that the entire house was in flames. Mrs. Rorie and the two children were burned to death, and only skulls and bones remained the morning after the fire. Rorie pleaded guilty, and a jury was impaneled to ascertain the degree of crime, and to fix the punishment. During the trial, various objects were introduced into evidence relating to the crime, including pictures of the victims in wicker baskets, burned beyond recognition, Rorie’s bloodstained shirt, and the hammer used in the murder. Appellant objected to the introduction of several different objects introduced as evidence. This Court held such objections to be without merit, and stated: “The cause was tried to the jury just as though the defendant had pleaded not guilty. Every essential fact of the crime was established. The jury was instructed on the degrees of murder and the discretion as to the punishment.” It would certainly appear that the exhibits here introduced, together with the evidence objected to, were plainly relevant to assist the jury in determining the degree of the crime.

By assignment No. 8, appellant cites as error the failure of the court to instruct the jury as to insanity. No request was made for such instruction; in fact, the record reveals that defense counsel stated: “I would like for the record to show that Mr. Trice and myself have not submitted any instructions for the reason that we feel that the court’s instructions adequately cover the case as developed.” We accordingly find no merit in this contention. See McCuistion v. State, 213 Ark. 879, 213 S. W. 2d 619, and cases cited therein.

Appellant argues that the record does not reflect that the court specifically instructed the jury that if it found Smith guilty of first degree murder, there was a choice of fixing his punishment at either life imprisonment or death in the electric chair. In Alford v. State, 223 Ark. 330, 266 S. W. 2d 804, this Court said:

“We think, however, that the court was in error in failing to inform the jury of its option to impose either the death sentence or life imprisonment. Since this option lies entirely with the jury the court is under the affirmative duty of bringing the matter to'the jury’s attention, even though that action is not requested by the accused. * * * Nor is it shown that, when the forms of verdict were given to the jury by the court, any oral explanation of the forms was made. * * *”

In the case before us, the record reflects, “Whereupon, after the argument of counsel for the State and the defendant the Court instructs the jury as to its verdict forms; ’, three forms of verdict were then submitted to the jury, as follows:

“1.
We, the jury, find the defendant, Lawrence Smith, guilty of the crime of murder in the first degree, as charged in the information, and fix his punishment at death by electrocution.
Foreman
1-A.
We, the jury, find the defendant, Lawrence Smith, guilty of murder in the first degree, as charged in the information, and fix his punishment at life imprisonment in the State Penitenitiary.
Foreman
2.
We, the jury, find the defendant, Lawrence Smith, guilty of the crime of murder in the second degree, as charged in the information, and fix his punishment at imprisonment in the State Penitentiary for.........years.
Foreman”

Objection was made to the prosecuting attorney asking Mr. Fissell, the mortician, if he probed for the bullet in the forehead. We think the question was material, in that the answer showed that the bullet ranged downward in the head of the deceased, from the point of entry, which was competent evidence to prove premeditation and deliberation, in that the jury could reasonably believe that Smith was standing over the deceased when he fired that particular shot from his rifle.

A few other objections were made to questions asked, which we have noted, but we find no prejudicial error.

Finally, it is urged that the sentence should be reduced from death to life imprisonment. In Rorie v. State, supra, this Court said:

‘ ‘ When this Court finds that the evidence is insufficient to support the punishment assessed, then we have the power to modify the punishment. Our cases clearly reflect, however, that this modification is done, not on a basis of judicial clemency, but only in a case in which the evidence would not sustain the higher punishment assessed.”

See also Turnage v. State, 182 Ark. 74, 30 S. W. 2d 865.

It appearing that appellant received a fair trial, and no reversible error having been committed, the judgment is affirmed.

Holt, J., dissents.

J. Seaborn Holt, J.,

dissenting. I am strongly of the view that the trial court erred in failing clearly and specifically to instruct the jury that it had the right, and that it was its positive duty, if it found the defendant guilty of murder in the first degree to fix the punishment at either death in the electric chair or life imprisonment. Section 4042 of Pope’s Digest — now Section 43-2153 Ark. Stats. 1947 — provides: ‘ ‘ The jury shall have the right in all cases where the punishment is now death by law, to render a verdict of life imprisonment in the state penitentiary at hard labor”. In construing this section, we said in Smith v. State, 205 Ark. 1075, 172 S. W. 2d 248: “This court has repeatedly held that it is error for the trial court to fail to instruct the jury that it might fix the punishment at life imprisonment. The defendant does not have to request this instruction. It is mandatory on the trial court in a first degree murder case to advise the jury of its power to fix the punishment at life imprisonment. See Webb v. State, 154 Ark. 67, 242 S. W. 380. An examination of the original transcript and motion for new trial in the "Webb case shows that no assignment of error was contained in the motion for new trial about this failure to so instruct the jury, and yet this court, speaking by Mr. Justice Hart, on rehearing, said: ‘In the present case, the finding of the jury might have been different had the court explained to the jury the alternative right given it by the statute in fixing the punishment of the accused. Therefore the majority of the court is of the opinion that the punishment prescribed by the statute being alternative in its character, and the statute having made it the duty of the jury to exercise its discretion in fixing the punishment, it was part of the law applicable to the case, and the trial court erred in not charging the jury in regard to the discretion to be exercised by it in case the accused was found guilty of murder in the first degree. The error can be cured, however, by reducing the punishment of the appellant to life imprisonment. The sentence of death for murder in the first degree will be set aside, and the sentence reduced to imprisonment for life in the state penitentiary at hard labor, unless the Attorney General elects within two weeks to have the judgment reversed and the cause remanded for a new trial. ’ ’ ’ Just to hand to the jury the verdict forms, as here, when a man’s life is at stake was not sufficient to comply with the statute, in my opinion. The record does not show just what the court’s instructions to the jury, if any, were on this important issue. All that is shown by the record is that after the argument of counsel, both for the State and defendant, ‘ ‘ The court instructed the jury as to its verdict forms and the jury retired to consider its verdict”. Who can say that the verdict here might not have been different had the court explained to the jury their alternative right fixed, by the statute, in assessing the punishment. Certainly this statute was a part of the law applicable to the case and made it the duty of the jury, once they found the defendant guilty of murder as here, to exercise their discretion in fixing the punishment at either life imprisonment or death. Especially should this duty have been emphasized by the court and clearly explained when, as here, they were dealing with an ignorant 18-year-old Negro boy who had had only about three years in school and whose sanity, according to the evidence, was in much doubt. Obviously, it seems to me, that if there be any doubt about what the trial court might have said to the jury (the record does not show) when the verdict forms were handed to them, that doubt should be resolved in favor of the defendant.

In the recent case of Alford v. State, 223 Ark. 330, 266 S. W. 2d 804, we said: “We think, however, that the court was in error in failing to inform the jury of its option to impose either the death sentence or life imprisonment. Since this option lies entirely with the jury the court is under the affirmative duty of bringing the matter to the jury’s attention, even though that action is not requested by the accused. Webb v. State, 154 Ark. 67, 242 S. W. 380; Smith v. State, 205 Ark. 1075, 172 S. W. 2d 248.”

Accordingly, I would reduce the punishment to life imprisonment, giving the Attorney General the option to accept this modification, otherwise, I would remand for a new trial.

       See Sections 43-1301 and 43-1304, Ark. Stats. (1947) Anno.

       Eight witnesses testified, including appellant.

       Smith had served 6 months in the penitentiary for stealing a watch, and was out on parole at the time he killed Cundiff.

       Of course, appellant had pleaded guilty to murder.

       Emphasis supplied.