text:
    Mary M. PHIPPS and Erwin K. BROWN, Individually and d/b/a PHIPPS AND BROWN, and PHIPPS AND BROWN, INC. v. Ronald C. STOREY and Hazel Hindsley STOREY
    CA 80-105
    601 S.W. 2d 249
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980

      W. G. Dinning Jr., oí Dinning & Dinning, for appellants.

      John Mauzy Pittman, oí Baker & Pittman, for appellees.
   Marian F. Penix, Judge.

Appellees, Ronald and Hazel Storey, petitioned the trial court for an Order declaring the rights of petitioners and defendants-appellants which arose out of a lease contract dated August 28, 1974. The court held that the renewal clause of the lease is void for uncertainty and unenforceable because it stated the rental amount for the renewal period would be determined by a future agreement. The court further found the actions of the appellees, Storeys, were not premature in that the prayer was for a declaration of rights and status under the League Contract, and fully authorized by the Declaratory Judgment Act, because of a justiciable controversy. The court held the appellants-defendants have no right or interest in the property in question after December 31, 1979 at which time the Lease Contract will have terminated by its own terms. The appellants-defendants appealed.

Kelsey Broom, an incompetent, owned 160 acres of land and Mabel Ruth Broom owned 80 acres. On January 23, 1970 Mabel Ruth Broom and the Guardian of Kelsey Broom leased these lands to Johnny Phipps for a period of five (5) years beginning January 1, 1970 and ending December 31, 1974 for a yearly rental of $4500. Prior to the expiration of the original Lease Contract, Kelsey Broom died. He willed his interest to Mabel Ruth Broom, the other lessor. On August 28, 1974 Mabel Broom entered into a new Lease Contract with Johnny Phipps as to the same lands for a period beginning January 1, 1975, and ending December 31, 1979, for a rental of $10,000 per year, payable annually.

On page 2 of this Lease Contract, paragraph four provides:

At the expiration of this Lease Contract the Lessee, Johnny Phipps, is given and granted the right and option to renew this Lease Contract for a period of five (5) years, beginning January 1, 1980, and ending December 31, 1984, on the same terms and conditions as set forth herein, at and for an annual rental to be agreed upon by the Lessor, her heirs, executors, administrators, assigns, and successors and the Lessee, Johnny Phipps, provided the right to renew this Lease Contract is exercised in writing by the Lessor and the Lessee on or before September 1, 1979; and the annual rental is mutually agreed upon in writing by the Lessor and the Lessee on or before September 1, 1979; otherwise the right and option to renew this Lease Contract shall terminate and end.

Mabel Broom died January 17, 1975 and Beverly Cockrell was appointed executrix of her estate. The executrix sold the lands to the Storeys, appellees. The notice of the sale and the deed made reference to the lease of August 28, 1974, with all rights of Mabel Broom being transferred to the Storeys. Johny Phipps died March 10, 1977 and Mary Phipps was sole devisee under his will. Before Johnny Phipps died his attorney, W. G. Dinning, Jr. had, on October 11, 1976 written to E. L. Schieffler and David Solomon, attorneys for the heirs and executrix of the Broom estate, sending a copy of an assignment by which the lease had been transferred by Phipps to Phipps and Brown, Inc., a corporation. Attorney Solomon acknowledged the receipt of the October 11 letter and purported assignment but Solomon stated that an assignment was not possible under the lease and not acceptable by the executrix. Solomon also stated Attorney Schieffler, who represented some of the devisees of the farm land involved in the lease would not, in Solomon’s opinion, consent to the assignment of the lease.

On April 10, 1979, Mary Phipps, as an individual, undertook to give a notice to the Storeys the lease would be renewed for an additional five (5) year period beginning January 1, 1980 and ending December 31, 1984. As a result of Mary Phipps’ notice the Storeys filed their suit for a Declaratory Judgment claiming the option was null and void and that the Appellants had no further right to possession of the property for the calendar years of 1980 to 1984. The court’s Declaratory Judgment held the option clause to be invalid and held the Appellants were not entitled to possession after December 31, 1979.

Our threshold question is whether the appellants have any right under the Lease Contract dated August 28, 1974, to lease these lands for five (5) years beginning January 1, 1980?

The Storeys contend, and the trial court agreed, the language “at and for an annual rental to be agreed upon by the Lessor, her heirs, executors, administrators, assigns and successors, and the Lessee, Johnny Phipps” is meaningless and of no effect.

The general or majority rule is stated in 50 Am. Jur. 2d 40, Landlord and Tenant, Section 1165:

A renewal covenant in a lease which leaves the renewal rental to be fixed by future agreement between the parties has generally been held unenforceable and void for uncertainty and indefiniteness.

The majority view is reflected in the 1947 Arkansas case Lutterloh v. Patterson, 211 Ark. 814, 202 S.W. 2d 767. The clause of the lease in that case stated as follows:

Lessee agrees to pay the following rent for the premises: Fifty Dollars ($50.00) per month, payable in advance for two (2) years, then Sixty Dollars ($60.00) per month for the additional three (3) years, with option for renewal for five (5) years, with the understanding the price of rental is fixed at the termination of the rent contract as of June 14, 1946.

The Court held this language to be ambiguous and susceptible of two interpretations, therefore, the case was remanded to the trial court for further testimony. The court stated:

On the other hand, it may be said that the language in dispute meant only that the rental for the additional five years was to be ‘fixed’, or agreed upon, at the time of the termination of the first five year period, and that, if the parties had intended to “fix” the rental for the additional term at $60 they could and would have simply, and without circumlocution, provided in the lease that the rental for the optional period would be $60 per month. If this construction should be sustained it would result in the provision for the option being void for uncertainty. At 817.

The lease in the present case is not ambiguous. It is not capable of more than one interpretation. The rental amount of the renewal period is to be determined by a future agreement.

The Appellants cite Beasley v. Boren, 210 Ark. 608, 197 S.W. 2d 287 (1946). Beasley, however, is distinguishable from this case. There, by the actions of the parties, a lease which had expired was renewed on a month by month basis. The court held the indefiniteness was made certain by the actions of the parties in carrying out the provisions of the lease on a month to month basis. The court held the uncertainty had been removed by the acts of the parties.

The law, as expressed in Lutterloh, supra, has also been enunciated in other cases. In Keating v. Michael, 154 Ark. 267, 242 S.W. 563 (1922), the Supreme Court stated:

A covenant to renew upon such terms as may be agreed upon is void for uncertainty . . .No provision was fixed in the contract except such rental value as the parties might agree upon. They might never agree, and so the case falls squarely within the general rule announced above, and the contract is too uncertain and indefinite to be enforced.

Likewise in Hatch v. Scott, Admx., 210 Ark. 665, 197 S.W. 2d 559 (1946), the court determined:

A covenant to renew upon such terms as may be agreed upon is void for uncertainty. It is nothing more than an agreement to make an agreement.

See also, Ferrill v. Collins, 225 Ark. 247, 281 S.W. 2d 939 (1955). See generally, 58 ALR 3d 500, Renewal of Lease — Rental to be Agreed Upon.

In order to be enforceable a contract must be definite and certain in all of its terms and conditions in order that the court may know what the parties have agreed upon. Where the annual rental is not agreed upon and the contract does not otherwise provide a manner for its definite determination, the contract does not meet this test. Therefore, the renewal clause is void for uncertainty and unenforceable.

Affirmed.


source: Caselaw Access Project

author: George Howard, Jr., Judge.

license: Public Domain

text:
    Peter G. ESTES v. James N. WALTERS, Ron HARROD, Edgar M. HOUSE, Dr. Ralph RATTON, Dr. Carl E. HYMAN, THE ALCOHOLIC BEVERAGE CONTROL BOARD and Carmel B. JONES, d/b/a CHUCKWAGON LIQUOR
    CA 80-68
    601 S.W. 2d 252
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980

      Estes, Estes & Estes, for appellant.

      Marshall N. Carlisle, of Murphy & Carlisle and Donald R. Bennett, for appellees.
   George Howard, Jr., Judge.

The issue before the Court is whether the appellant had standing to challenge the action of the Alcoholic Beverage Control Board in affirming the action of its Director in granting to one Carmel B. Jones a new retail liquor and off-premises beer permit, tor a store at 1935 School Street, Fayetteville.

The Alcoholic Beverage Control Board dismissed appellant’s appeal from the action of its Director on the grounds that there was no evidence that the appellant appeared as a protestant prior to the action of the Director in granting the new permit as required by Ark. Stat. Ann. § 48-1314 (Repl. 1977), which provides:

Any applicant or licensee aggrieved by an order of refusal, suspension or revocation issued by the Director or any person or group of persons, who have formally protested the issuance of any license before a decision had been rendered by the Director and are aggrieved by the issuance of said license, may appeal from such order or decision to the Alcoholic Beverage Control Board by filing a notice of appeal with the said Board.

Appellant sought judicial review of the Board’s action in the Washington County Circuit Court. While finding that appellant’s petition was filed as an appeal for review of a decision of the Board pursuant to the Administrative Procedure Act, the circuit court found that there was substantial evidence to sustain the decision of the Board and dismissed appellant’s petition.

Arkansas’ Administrative Procedure Act, Ark. Stat. Ann. § 5-713 (Repl. 1976) provides:

Judicial review of adjudication. — (a) In cases of adjudication, any person who considers himself injured in his person, business, or property by final agency action shall be entitled to judicial review thereof under this Act. Nothing in this Section shall be construed to limit other means of review provided by law.
(b) Proceedings for review shall be instituted by filing a petition.
(1) in the Circuit Court of any county in which the petitioner resides or does business, or
(2) in the Circuit Court of Pulaski County within thirty days after service upon petitioner of the agency’s final decision. Copies of the petition shall be served upon the agency and all other parties of record by personal delivery or by mail. The court, in its discretion, may permit other interested persons to intervene.

In Arkansas Savings & Loan Ass’n Board v. Corning Savings & Loan Ass’n, 252 Ark. 264, 478 S.W. 2d 431, the Arkansas Supreme Court stated that the Administrative Procedure Act provides an alternate appellate procedure and jurisdiction for the judicial review of an adjudication by an agency subject to the act. See also: Travelers Indemnity Company v. Ark Monroe, III., Insurance Commissioner of The State of Arkansas, 257 Ark. 1029, 522 S.W. 2d 431.

We perceive from the plain meaning of the language of the Administrative Procedure Act as affording to “any person who considers himself injured in his person, business or property, by final agency action’’ judicial review of such action whether such person was a party to the administrative proceeding or not. We believe the circuit court’s interpretation of the Administrative Procedure Act as affording judicial review only to those individuals who may be regarded or characterized as parties to the administrative proceeding as unduly restrictive. It is plain that any person who had been adversely affected or aggrieved by the action of an agency covered by the Act, may seek redress, in the circuit court in the county where the petitioner resides or does business or in the Circuit Court of Pulaski County within thirty days after service of the agency’s final decision.

While we affirm the action of the Circuit Court of Washington County in the dismissal of appellant’s petition, we do so for reasons entirely different from those asserted by the circuit court.

We hold that appellant has failed to set out in his petition, filed in the Washington County Circuit Court, allegations showing in what way he has already sustained or is immediately in danger of sustaining injury either in his “person, business or property” as a consequence of the final action of the appellees in issuing the new permit to Jones. Only a claimant who has a personal stake in the outcome of a controversy has standing to invoke the jurisdiction of the circuit court in order to seek remedial relief; his injury must be concrete, specific, real and immediate rather than conjectural or hypothetical. See: Public Citizens, et al., v. Lockheed Aircraft Corporation, et al., 565 F. 2d 708 (1977); McDowell v. Schlesinger (DC MO) 404 F. Supp. 221.

In Arkansas Savings & Loan Ass’n Board v. Central Arkansas Savings & Loan Ass’n., 260 Ark. 58, 538 S.W. 2d 505 (1976), the Arkansas Supreme Court has emphasized that under the language of Arkansas’ Administrative Procedure Act the courts are given the same type of review that is applied by the federal courts to the federal Administrative Procedure Act.

Affirmed.

Hays, J., not participating.

       A prior retail liquor and off-premises beer permit held by Carmel B. Jones for the same location was revoked and surrendered pursuant to an order of the Washington County Circuit Court on December 4, 1978.

       While the Board’s decision of April 18, 1979, is predicated on the finding that appellant was not a protestant, or a party to the proceeding before its Director, the Board’s action, in fact, is an affirmance of the Director’s action and consequently, is final. Moreover, appellant’s petition, under the Administrative Procedure Act, filed in the circuit court on May 3, 1979, sought an order "reversing the action of the .. . Board in issuing the .. . license and an order cancelling such license. .. .”


author: George Howard, Jr., Judge. David Newbern, Judge,

text:
    CHICAGO MILL & LUMBER COMPANY, Employer v. Starline GREER, Employee, and STATE of Arkansas, Second Injury Fund
    CA 80-104
    601 S.W. 2d 583
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980

      Daggett, Daggett & Van Dover, by: Jesse B. Daggett, for appellant.

      Mike J. Etoch, Jr., for appellees.
   George Howard, Jr., Judge.

On January 17, 1978, claimant-appellee, a 62-year-old black man, with no formal education — claimant cannot even write his name — while in the course of his employment with appellant, was injured when a log fell on his right foot fracturing his ankle. The fracture required surgery involving the insertion of metal screws to repair the injury.

Claimant’s left leg was amputated below the knee in 1938 or 1939 as a consequence of an injury for which he received no compensation.

The Workers’ Compensation Commission, in determining claimant’s permanent disability and the application of Arkansas’ Second Injury Law to such determination, made the following findings of fact:

1. That as a result of the combined effect of the non-job-related amputation of his left leg and the 40 percent impairment to his right leg resulting from the compensable injury of January 17, 1978, the claimant is permanently and totally disabled.
2. That payments from the Second Injury Fund as per Section 13(f)(2)(iii) are not applicable to this claim.
3. That the non-job-related amputation of the claimant’s left leg below the knee prior to the compensable injury of January 17, 1978, independently produced some degree of disability before the accident and continues to operate as a source of disability after the accident; ;and that the respondent, Chicago Mill & Lumber Company, is entitled to a credit of $10,500.00 under the Rule of Apportionment for the non-job-related amputation of the left leg and is based upon 125 weeks at $84.00 per week.
4. That respondents’ total liability for all weekly compensation benefits to the claim under Finding of Fact No. 3 amounts to $39,500.00 and represents 470.24 weeks at $84.00 per week; and that after respondents have paid weekly benefits which amount of $39,500.00, further benefits due the claimant for total disability shall be paid from the Death and Permanent Total Disability Bank Fund.

In explaining the Commission’s posture in fixing the employer’s share at $39,500.00 for claimant’s disability - the Commission apportioned claimant’s share at $10,-500.00 — the Commission stated:

“As per Section 10(c)(2) of the Act, the respondent’s total disability for weekly benefits in this case is $50,000.00. The claimant, prior to his compensable injury of January 17, 1978, suffered a non-job-related amputation of his left leg below the knee which would have entitled him to 125 weeks of compensation if the amputation had been the result of a compensable injury. There is no evidence in the record as to when the amputation occurred, or the amount of the claimant’s earnings at the time of the amputation. In view of the lack of evidence concerning this question, we feel that a fair and reasonable method to determine the credit to be given from the prior injury is to base it on the claimant’s earnings at the time of the compensable injury of January 17, 1978. The claimant’s compensation rate for the injury of January 17, 1978, is $84.00 per week, and 125 weeks at $84.00 per week for the amputation of the left leg below the knee will give the respondent, Chicago Mill & Lumber Company, a credit of $10,500.00.
“Since the maximum total liability ol the respondent, Chicago Mill & Lumber Company, is $50,000.00, and giving them a credit of $10,500.00, for the non-job-related amputation of the claimant’s left leg, will leave a balance to be paid by the respondent, Chicago Mill & Lumber Company, of $39,500.00 or 470.24 weeks at $84.00 per week.”

Appellant argues that the Commission erred in ruling that the second injury fund was not applicable in this proceeding.

In Arkansas Workmen’s Compensation Commission v. Sandy, 217 Ark. 821, 233 S.W. 2d 382 (1950), the Arkansas Supreme Court made the following relevant comment in sustaining the Commission’s holding that the claimant was not entitled to payment from the “Second Injury Fund”:

“This court has held that the degree of disability suffered by an injured employee is a factual question to be determined from the evidence in the case.”

The Supreme Court commented further in Sandy by quoting from the opinion of the Commission:

“ ‘This fund, called the ‘Second Injury Fund’, is a limited and restricted fund and is created specifically for the benefit of those employees who are found to be totally and permanently disabled and who strictly comply with the provisions and requirements of § 13(f)(2)(iii). While Workmen’s Compensation Acts are generally to be liberally construed the solvency of this special ‘Second Injury Fund’ requires that the provisions and requirements thereof be fully and strictly complied with. In our opinion, the ‘loss of a member or organ’, or the ‘loss of use of a member or organ’, as is provided for in § 13(f)(2)(iii) means the total loss or total loss of use. To hold otherwise would open this special fund to the point of insolvency and provide no benefit to those who do comply with its provisions and who are entitled to benefits thereunder.’ ”

Dr. Harold H. Chakales, claimant’s physician,- submitted a medical report dated October 17, 1978, which reads:

“At this time, I feel that Mr. Greer has reached maximum healing and that he carries a physical impairment of approximately 35-40% of the right lower extremity.”

Dr. Richard M. Logue, who examined the claimant at the request of the employer, stated in his medical report dated August 18, 1978:

“. . . I would anticipate that his disability relating to this injury would be in the magnitude of possibly 15 percent to the right leg below the knee.”

The claimant testified with reference to his right leg: “. . . I can’t stand up on it no more, because I tries it . . that he has tried to resume work on three occasions, but was “told to go back home” after working about an hour with his crutches when his foot started swelling and paining; and that his left leg is a wooden leg.

Upon this evidence the Commission found that claimant’s impairment to his right leg was 40%, and, accordingly, he has not sustained a total loss of use required under the statute governing the second injury fund.

We hold that there is substantial evidence to support the holding of the Commission.

Appellant also argues that the Commission “erred by apportioning the specific value of the pre-existing injury ($10,500.00) rather than the effect of the pre-existing injury upon the ultimate liability, $45,800.00.” In other words, appellant is ultimately liable only for the amount of disability attributable to the injury of January 17, 1978 — the 40% impairment of claimant’s right leg, an award of 50 weeks at $84.00 per week or $4,200.00. “Any additional award resulting from the effect of the pre-existing injury and therefore that portion ($45,800.00) should be apportioned.”

Under Ark. Stat. Ann. § 81-1310(c)(l)(2) (Repl. 1976), appellant’s total liability for claimant’s permanent total disability for weekly benefits is $50,000.00. The Commission, having found that claimant’s pre-existing impairment independently produced some degree of disability before the compensable injury as well as after the injury, concluded that claimant’s pre-existing disability resulting from the non-job-related amputation of his left leg should be apportioned.

Inasmuch as there was no evidence in the record specifying the exact date that claimant’s left leg was amputated or the amount of the claimant’s earnings at the time of the amputation, the Commission concluded that a fair and reasonable method for determing the credit to be given for the pre-existing injury was to base the calculation on claimant’s earnings at the time of his compensable injury of January 17, 1978, and apply the schedule for such a member contained in Ark. Stat. Ann. § 81-1313(c). A credit of $10,-500.00 was applied against appellant’s Lability of $50,000.00, thus requiring appellant to pay $39,500.00 or 470.24 weeks at $84.00 per week. At the end of this period, further payments due claimant for his total disability would be made from the Death and Permanent Total Disability Bank Fund.

The effect or the contribution of a pre-existing injury, when combined with a present compensable injury resulting in permanent total disability, as in the instant case, is seldom susceptible of exact proof. This determination must be left principally, if not entirely, to the discretionary estimate of the Workers’ Compensation Commission which is endowed with the responsibility to develop the State’s policy in industrial injury cases. Southeastern Construction Company, et al v. Dependent of S. W. Dodson, Deceased, 153 So. 2d 276 (Miss. 1963); Bill Williams Feed Service v. Mangum, 183 So. 2d 917 (Miss. 1966). The question involving a worker’s total disability is to be determined as a question of fact. Eddie McNeely v. Clem Mill & Gin Company et al, 241 Ark. 498, 409 S.W. 2d 502 (1966); Arkansas Workmen’s Compensation Commission v. Sandy, supra.

Prior to claimant’s compensable injury on January 17, 1978, claimant was fully employed, engaged in heavy manual labor involving mill work, his job assignment required a considerable amount of standing and walking and it is clear that claimant performed satisfactory service at Chicago Mill over a relatively long period of time in spite of the fact that he had a wooden leg. Indeed, the Commission was free to consider these factors and any inferences derived therefrom in making the apportionment in this case. We are unable to perceive, and the appellant has not demonstrated, any abuse of the Commission’s discretion or manifest errors on the part of the Commission in making the apportionment in this proceeding.

Total disability, within the meaning of the Workers’ Compensation Law, does not mean merely functional disability, but includes the varying degrees in each instance, loss of use of the body to earn substantial wages. Glass v. Edens. 233 Ark. 786, 346 S.W. 2d 658 (1961). Balancing of functional factors and loss of use of the body to earn substantial wages is a responsibility of the Commission. Mann v. Potlatch Forrests, 237 Ark. 8, 371 S.W. 2d 9 (1963).

The Supreme Court made the following relevant comment in Rooney & Travelers Insurance Co. v. Charles, 262 Ark. 695, 560 S.W. 2d 797 (1978), Justice, now Chief Justice, Fogleman, speaking for the Court:

“We have long recognized that the wage-loss factor, i.e., the extent ‘to which a compensable injury has affected a claimant’s ability to earn a livelihood,’ rather than the functional or anatomical loss, is generally controlling in disability determinations, which are to be made by the Workmen’s Compensation Commission on the basis of medical evidence, age, education, experience and other matters reasonably expected to affect the claimant’s earning power. .. .”

Finally, appellant contends that if the Second Injury Fund is not liable and appellant is required to pay benefits in excess of the scheduled allowance for the 40% impairment to claimant’s right leg, $4,200.00, handicapped employees may be discharged when their employers adjust their work force to miminize their exposure.

Appellant’s argument is neither persuasive nor impressive, for studies have established that handicapped workers have a lower accident rate than workers in possession of their full functions. See: Encouragement of Employment of the Handicapped, 8 Vand. L. Rev. 575 (1955). Moreover, emphasis is now placed on the rehabilitation of employees who have sustained permanent disability in industrial accidents. Rehabilitation Within The Worker's Compensation Framework, 19 Rutgers Law Review 401 (1965). Arkansas’s Rehabilitation Law, Ark. Stat. Ann. § 81-1310(f) is perhaps one of the most objective pieces of legislation designed to cope with the problems involving disabled or handicapped employees.

Moreover, the history of claimant’s performance as an employee, over the years, as well as Chicago Mill’s conduct after claimant was discharged by his physician, refutes appellant’s argument. After claimant had reached the maximum healing period, appellant returned claimant to his former work assignment even though claimant was even more handicapped than before. It is clear that claimant was a dependable, conscientious and dedicated employee. To limit claimant’s recovery can likewise cast a deleterious effect on the efforts of the Commission and employers alike endeavoring to promote the rehabilitation of the handicapped. Needless to say, a reversal of the Commission in this case will have the effect of penalizing a handicapped employee who has sought to improve himself economically without relying solely on social agencies for assistance. Indeed, society’s attitude and thinking about the handicapped in 1980 is more humane and realistic than it was fifty years ago.

Affirmed.

Wright, C.J., and Hays and Newbern, JJ., dissent.

David Newbern, Judge,

dissenting. The appellant asks only that the apportionment of its liability be done in a fair manner. The prevailing opinion (there is no majority in this case) affirms apportionment by the workers’ compensation commission in a manner I view as being grossly unfair to the appellant.

There is no direct statutory authority for apportionment of liability for total disability. However, the Arkansas Supreme Court has approved the doctrine of apportionment, at least in cases where it is necessary to divide responsibility between two employers. International Paper Company v. Remley, 256 Ark. 7, 505 S.W. 2d 219 (1974).

In the Remley case Justice George Rose Smith’s opinion dealt with an employee who had sustained a 20% permanent partial disability of the hand before going to work for the appellant-employer. He thereafter sustained an additional 15% permanent partial disability to the same hand a a result of a compensable injury. The commission’s decision, which was affirmed by the circuit court, awarded compensation against the employer for the entire 35% disability on the theory that apportionment would be contrary to the general purposes of the act. The supreme court reversed that holding. Justice Smith said:

. . .[W]orkers as a whole will not always benefit in the long run by a rule of non-apportionment that makes an employer liable for the total consequences of a second injury, as if the first injury had not occurred. Such a rule might easily make it hard for the victims of a first injury to find re-employment.
. . . [T]he fact that Remley’s 1934 injury did not result in a loss of earning capacity is not of paramount importance, because the act provides a fixed schedule of payments for an injury to the hand. Secondly, a rule denying apportionment as between two injuries is not necessarily a desirable one for all workmen.

The overall benefits to be obtained by apportionment were also noted in Corbit v. Mohawk Rubber Co., 256 Ark. 932, 511 S.W. 2d 184 (1974), and Wooten v. Mohawk Rubber Co., et al., 259 Ark. 837, 536 S.W. 2d 734 (1976). Cf., O.K. Processors v. Dye, 241 Ark. 1002, 411 S.W. 2d 290 (1967).

We cannot tell what formula the court would have used for apportionment in the Remley case had there been total disability. The appellant-employer there contended it was responsible only for 15% disability suffered in its employ. The ultimate statement in the portion of the opinion dealing with this problem was as follows:

Therefore the appellee’s recovery for the functional loss caused by the second injury cannot under the statutory language [Ark. Stat. Ann. § 81-1313 (f) (2)i. (Repl. 1976) ], include the functional loss caused by the first injury.

The sentence quoted above refers to § 81-1313 (f) (2)i. That subsection applies only in instances where there has been a second injury to the “same member.” Subsection (f) (2)iii provides that “[i]f an employee who had previously incurred permanent partial disability through the loss of one ... leg . . . incurs prmanent total disability through the total loss of another member, ... he shall be paid in addition to the compensation for permanent partial disability provided in § 13(c) . . . additional compensation. ...” The “additional compensation” is to be taken from the second injury fund which is not available in this case.

Thus, the legislative apportionment policy our supreme court found in the Remley case is equally prevalent in cases of total disability resulting from total loss of a second member resulting in total disability. It should apply here also, even though the total disability results from less than total loss of the second member. Despite the lack of specific statutory language, the legislative policy clearly is that the employer should not be responsible for a disabling, scheduled injury an employee sustained before going to work for the employer in question. A logical extension of that premise is that an employer should also not be responsible for that portion of total disability attributable to the previous injury.

The prevailing opinion affirms the commission’s decision, including that portion which recognizes that, at the end of the employer’s apportioned responsibility, further payments due the claimant for his total disability will be made from the Death and Permanent Total Disability Bank Fund. Ark. Stat. Ann., § 81-1310(c)(2) (Supp. 1979). This, of course, is an appropriate recognition that it should make no difference to the claimant in this case whether he is compensated by his employer or his employer’s carrier or the Fund. And yet, near the conclusion of the prevailing opinion, there are references to limiting the claimant’s recovery and “penalizing a handicapped employee,” suggesting that an apportionment of any of the claimant’s entitlement would be unfair and “deleterious” to him. These remarks are inconsistent with the action taken by the commission and approved by the prevailing judges.

It is grossly unfair to the appellant-employer to apportion the maximum $50,000 liability so that it bears all of the responsibility for that amount except $10,500. The total disability of the employee was caused by two physical factors. First, the employee lost a leg in an accident which occurred long before he became employed by the appellant. The second factor is the 40% disability incurred to the remaining leg while the claimant was employed by the appellant. To say that the latter factor is or should be regarded as the major (79%) contributor to the total disability is to ignore reality, even though some factors other than physical may enter into the total disability determination. The prevailing opinion saddles the latest employer with the lion’s share of the responsibility even though the physical injury for which he is responsible is by far the lesser of the physical causes of the disability.

As we have no apportionment statute, and as we cannot tell what formula our supreme court might use in a total disability case, it becomes incumbent upon us to devise a formula which will treat the parties fairly and consistently with what we can discern to be legislative policy. In this case the appellant-employer should be wholly responsible for that portion of the total disability which consists of the scheduled disability to the leg injured while the claimant was employed by the employer, i.e., 50 weeks at $84.00 per week or $4,200. As noted above, an employer whose employee sustains total disability in a case where there is no contributing scheduled disability is responsible to the maximum extent of $50,000. Ark. Stat. Ann., § 81-1310(c)(2) (Supp. 1979). By subtracting $4,200 from $50,000 we obtain a remainder of $45,800. That amount should be apportioned between the employer and the Fund.

As the scheduled disability to the remaining leg is 29% of the combined value of the two injuries in accordance with the schedule, [$4,200 equals 29% X ($4,200 + 10,500) ], we should apportion the remaining disability $45,800) by requiring the employer to pay 29% of that figure or $13,282. Thus, the employer should pay weekly benefits up to a total of $13,282 plus $4,200, or $17,482, with further payments to be made, as the commission held, from the Fund. The use of this formula would effectively apportion both the direct, physical and the other contributing factors in the total disability in accordance with the evaluation of the physical injuries by the statutory schedule.

I would reverse and remand for revision of the commission’s order.

Chief Judge Wright and Judge Hays join in this dissenting opinion.

       Claimant’s affidavit dated May 31, 1979, states:
      “ T was cutting timber for the Shannon Brothers in Mississippi around 1938 or 1939, when a tree fell on my left leg and crushed it. I did not receive any compensation for same; I even had to pay my own medical bills.’ ”

      Ark. Stat. Ann. § 81-1313(f)(2)(iii) provides:
      (f) Second injury: In cases of permanent disability arising from a subsequent accident, where a permanent disability existed prior thereto:
      (2) If an employee has a prior permanent total disability not occasioned by an injury resulting while in the employ of the same employer in whose employ he received a subsequent permanent injury, the amount of compensation for the subsequent injury shall be fixed as follows:
      iii. If an employee who had previously incurred permanent partial disability through the loss of one [1] hand, one [1] arm, one [1] foot, one [1] leg, or one [1] eye, incurs permanent total disability through the total loss of another member, enumerated in this sentence, he shall be paid, in addition to the compensation for permanent partial disability provided in Section 13(c) (subsection (c) of this section), additional compensation during the continuance of such total disability at the rate prescribed in Section 10 [§ 81-1310] of this Act applied at the time of the accident which produced the total permanent disability.

       It has been conceded by the parties in this proceeding that claimant is totally and permanently disabled.

       As a direct consequence of claimant’s compensable injury of January 17, 1978, his earning capacity was reduced from 100% to zero.


text:
    Clyde CHISM et al v. Dessie TIPTON et al
    CA 80-107
    601 S.W. 2d 254
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980

      Macom, Moorehead, & Green, by: J. W. Green, Jr., for appellant.

      Fletcher Long. Jr., for appellee.
   George Howard, Jr., Judge.

Appellants, defendants below, and appellees, plaintiffs below, are adjacent property owners. It is stipulated that appellants are the record titleholders of the Northwest Quarter of the Southwest Quarter, Section 14 which lies north of the Southwest Quarter of the Southwest Quarter, Section 14, of which appellees are the record title owners.

The natural boundary line, representing the southern boundary line of appellants’ property and the northern boundary line of appellees’ property is approximately 12 to 15 feet north of the property claimed by the appellants by adverse possession, and the southern extremity thereof has been characterized by the appellants as the possessary line.

The second issue relates to the construction of an earthen levee by the appellees approximately between the eastern half of the boundary line for the protection against the flow of surface water draining from appellant’s property.

The trial court found that the appellants had acquired title to all lands north of the possessary line commencing at approximately the northwest corner of the Southwest Quarter of the Southwest Quarter and thence easterly for a distance of approximately 660 feet to an oak tree by adverse possession, but failed to establish title to that land east of the oak tree-the east half of land claimed involving a distance of 660 feet to the northeast corner of the Southwest Quarter of the Southeast Quarter of Section 14.

While the trial court did not specifically find that a natural stream or water course fed from a permanent or natural source, containing a definite channel, possessing a bed or banks, the court did treat the water flowing from appellants’ property across the appellees’ property as a watercourse, but did not order the appellees to remove the levee. However, the court directed appellees to divert the flowage to a ditch to be constructed along the boundary line to the northeast corner of appellees’ property and thence south in a ditch along the east boundary line of appellees’. The trial court further ordered that in the event appellees should interfere with the diversion of the water, appellees would be required to remove the levee so that the water could flow across appellees’ property as in previous times.

The appellants have appealed from the trial court’s decree permitting the levee to be maintained across what appellants contend is a natural watercourse, and the lower cour’s finding that appellants had not established their title to the east 660 feet of the Southwest Quarter of the Southwest Quarter.

The appellees have cross appealed from the trial court’s decree finding that appellants had established title to the west 660 feet of the Southwest Quarter of the Southwest Quarter by adverse possession, and from the finding that the water draining from appellants’ land is a watercourse, and in directing the appellees to remove the levee in the event appellees should interfere with appellants’ use of the ditch to be constructed to divert the water along the eastern boundary line of appellees’ property.

In Leader v. Mathews, 192 Ark. 1049, 95 S.W. 2d 1138 (1936), the Arkansas Supreme Court gave the following definition of a watercourse:

“ ‘A watercourse is defined to be a running stream of water; a natural stream, including rivers, creeks, runs and rivulets. There must be a stream, usually flowing in a particular direction, though it need not flow continuously. It may sometimes be dry. It must flow in a definite channel, having a bed or banks, and usually discharges itself into some other stream or body of water. It must be something more than mere surface drainage over the entire face of the tract of land occasioned by unusual freshets or extraordinary causes.’ ”

Water flowing into low places does not necessarily constitute a watercourse and where flooding develops, a landowner is justified in defending against flood water and can do so without incurring liability, unless he unnecessarily injures or damages another. Stacy v. Walker, 222 Ark. 819, 262 S.W. 2d 889 (1953). Moreover, a landowner is under no duty to receive upon his land surface water from the adjacent property. He may repel such water at his boundary where the result can be achieved without “disproportionate prejudice to another.” Stacy v. Walker, supra.

We are persuaded that the water flowing from appellants’ property across lands of the appellees is merely surface water. We perceive that the trial court did not specifically find that this was a running stream or a natural stream fed from permanent or natural sources.

Holly Lavone Fox testified that the water flowing across appellants’ land drains first from the Gid Robertson farm and across appellants’ property and then across appellees’ farm and exiting appellees’ farm through a culvert under Highway 79 South; that approximately one year prior to the trial, he improved the ditch on appellants’ farm by cleaning the ditch with his “little old side-winder ditch digger.”

John A. Johnson, Sr., who previously owned the property involved in this proceeding and is the grantor for both appellants and appellees or their predecessors, testified that during the 1930’s, the WPA constructed ditches across appellants’ property for drainage purposes and that the ditch “went angling down to the south about half-way southeast part of the part I sold Noel Fox (appellee), and they quit the ditch. . . . and me and my brother went in there with a middle buster and we plowed it on out as far as we could get down to the edge of the woods.”

We hold that the trial court’s decree should be modified to eliminate that provision in the trial court’s decree imposing a duty on the appellees to remove their earthen levee in the event the alternative watercourse is “interfered with in any manner whatsoever.”

We hold that the trial court’s holding that appellants have established title to the west approximately 660 feet of that property claimed by adverse possession, but failed to establish ownership of the east 660 feet, is supported by a preponderance of the evidence, and accordingly, we affirm.

James A. Johnson, Sr., testified essentially that he was in possession of the two tracts of land for approximately twenty-one years before he sold this property to the appellants and appellees or their predecessors; that the established boundary line between the two tracts was the old fence row which has been characterized as the possessary line commencing at the northwest corner of the Southwest Quarter of the Southwest Quarter and proceeding 660 feet to an old oak tree, but is not the true boundary line.

Sybil Chism testified essentially the same as John A. Johnson, Sr., that the fence extended from approximately the northwest corner of the Southwest Quarter of the Southwest Quarter to a point approximately 660 feet to an old oak tree. She also testified that appellees and their predecessors farmed their property up to the south end of the fence while she and her predecessors farmed the northern tract immediately north of the fence including the parcel claimed by adverse possession for a period of time in excess of the statutory period. She also testified that it was generally recognized by both the appellants and appellees and their predecessors that the fence was the dividing line between the two parcels of land.


author: David Newbern, Judge.

text:
    Stanley KELLEY d/b/a COACHMAN’S INN v. MID CONTINENT LEASING CO., INC., v. SIMMONS FIRST NATIONAL BANK OF PINE BLUFF
    CA 80-83
    601 S.W. 2d 257
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980
    As corrected on denial of rehearing Aug. 27, 1980

      Killough & Ford, by: Robert M. Ford, for appellant.

      Coleman, Gantt, Ramsey & Cox, by: Phillip A. Raley, for appellees.
   David Newbern, Judge.

Although this case presents a complicated set of facts, the issue may be stated simply. The question is whether there is sufficient evidence of the “reliance element” to sustain a judgment against the appellant which held him liable for deceit. We hold the evidence was not sufficient, and thus reverse the judgment.

On November 18, 1975, AARKCO Laundry Equipment Company agreed to sell to the appellant, Kelley, who operated the Coachman’s Inn Motel near Wynne, Arkansas, a new washer and a new dryer for use in the motel. The machines were described in the agreement by factory model numbers and brand name. Thereafter, Kelley and AARKCO’s president, Mr. Sutton, discussed the possibility of arranging for Kelley to lease the equipment rather than purchase it. This led to discussions with Mid Continent Leasing Co., Inc., president, John Davis, and ultimately to an agreement whereby Mid Continent purchased the machinery from AARKCO and leased it to Kelley. This purchase-lease agreement was apparently contingent upon Mid Continent being able further to sell the equipment and assign the lease to Simmons First National Bank of Pine Bluff. The bank thus became the financier of the transaction.

At some point the lease document and another document entitled “Receipt and Acceptance of Leased Property” were given by Mid Continent to AARKCO’s president, Sutton. Sutton presented these documents to Kelley for signature. The testimony of Kelley and unconflicting testimony of all witnesses with respect to the acts of Sutton make it clear their understanding was that even though the equipment had not yet been received by Kelley, the execution of those documents was essential for the transaction to be completed. Kelley thus signed both documents without having received the machinery.

A dryer and washer were thereafter delivered to Kelley. The dryer apparently was adequate and conformed to the specifications originally agreed upon. The washer, however, was discovered by Kelley to be “used,” and he returned it. At that point, Kelley refused to make further payments to the bank upon the assigned lease. The bank brought suit against Mid Continent for breach of the sales agreement and for deceit with respect to the lease agreement. The defendant, Mid Continent, then filed a third-party complaint against the appellant, Kelley, alleging deceit. The bank was awarded a judgment against Mid Continent in the amount of $6,184.12. The judgment of the court, which determined the case without a jury, then stated:

It is further considered, ordered and adjudged that the defendant and cross-plaintiff have judgment over and against the cross-defendants, The Coachman’s Inn, Inc. and Stanley Kelley, for all amounts recovered against it by the plaintiff as specifically set forth above, for all of which a writ of garnishment or levy for execution may issue.

The court’s judgment shows that of the amount awarded to the bank, $5,694.30 represented compensatory damages resulting from Mid Continent’s breach of the sales agreement and $489-82 represented compensatory damages for deceit of Mid Continent with respect to the procuring of the assignment of the lease to the bank.

Mid Continent has not appealed. Thus, we are concerned only with the rights of the appellant here as against Mid Continent. It is apparent to us that there was no reliance by Mid Continent upon the appellant’s statement that he had received and found acceptable the machinery in question. Although Davis testified he did not know the property had not been delivered, and that he assumed the dryer and washer were both “there,” it is clear to us that Sutton and AARKCO were acting on behalf of Mid Continent when Sutton delivered the documents to Kelley for signature. Despite Davis’s testimony, the record, viewed as a whole, compels us to conclude that all parties to the transaction knew the money would not be available from the bank until all of the “paper work” had been completed, and that AARKCO would not deliver until it was assured of the availability of the purchase price. At any rate, Davis’s testimony leaves no doubt that Sutton carried the “Receipt and Acceptance” instrument to Kelley as a representative of Mid Continent which had prepared that instrument as well as the lease. As noted above, the bulk of the Judgment in favor of the bank against Mid Continent represented the breach of contract claim. Therefore, this is not a true “liability over” case. Although the bank recovered a lesser amount of its deceit claim with respect to the assigned lease, presumably because of Mid Continent’s representation that the equipment had been delivered, that would not permit “liability over” in excess of that amount against the appellant. To hold the appellant was liable for the entire amount recovered by the bank, we would have to close our eyes to the fact that the loss of which the bank complains was not caused by any misrepresentation as to time of delivery, but was caused by the failure of Mid Continent and AARKCO to deliver a piece of equipment which conformed to the original specifications.

We need only decide whether there is sufficient evidence to support Mid Continent’s claim against the appellant. Reliance is a primary element in the action for deceit. Beam Bros. Contractors v. Monsanto Co., Inc., 259 Ark. 253, 532 S.W. 2d 175 (1976); Prosser, Law of Torts, §§ 105 and 108 (1971). See also, Westinghouse Credit Corp. v. First Nat’l Bank of Green Forest et al, 241 Ark. 287, 407 S.W. 2d 388 (1966). We have no difficulty holding the record before us does not contain evidence sufficient to show reliance on the part of Mid Continent upon Kelley’s statement that the equipment had been delivered. Thus, we find the trial court’s judgment was, in this respect, clearly erroneous or clearly against the preponderance of the evidence. A. R. Civ. P., 52(a).

Reversed.

Howard, J., not participating.


text:
    Alice Elaine SARGENT v. DAISY MANUFACTURING COMPANY and AMERICAN HOME ASSURANCE COMPANY
    CA 80-126
    601 S.W. 2d 259
    Court of Appeals of Arkansas
    Opinion delivered July 2, 1980
    Released for publication July 8, 1980

      Burrow & Sawyer, by: Lloyd C. Burrow, Jr., for appellant.

      Jones, Gilbreath & Jones, by: E. C. Gilbreath, for appellees.
   David Newbern, Judge.

In this workers’ compensation case the question is whether there record to support the commission’s denial of compensation to the claimant. The appellant argues there is no substantial evidence to support the decision because the physician, upon whose testimony the commission must have relied, testified in a somewhat self-contradictory way. We find the testimony not to have been so self-contradictory as to make it less than substantial, and thus we affirm.

The appellant has had three episodes of cystocele and rectocele, each of which required surgical repair. The last incident occurred in 1977, and it resulted from a work-related injury for which the appellant received workers’ compensation. She thereafter claimed permanent disability. An administrative law judge found she was permanently disabled to the extent of 33-1/3% to the body as a whole. The commission reversed that decision, finding the appellant suffered no permanent disability as a result of her injury.

The testimony in the record consists largely of the statements of Dr. Jennings who performed all of the surgical procedures upon the appellant, and the testimony of Dr. Elkins who has examined the appellant since her last surgery. Dr. Jennings had been the appellant’s family physician for many years and up until his retirement. Dr. Elkins was consulted by the appellant after Dr. Jennings’ retirement.

The appellant has a number of current, physical complaints including low back pain, urinary incontinence and constipation. Following her 1977 surgery, Dr. Jennings gave his permission for the appellant to return to work but recommended that she avoid heavy lifting and straining. She attempted to go back to her job with Daisy, but they declined to take her back because they had no job which did not require lifting and stooping, which the appellant felt she was unable to do. Dr. Jennings’ final report after the most recent surgery report said that the claimant had sustained no permanent disability. Yet, he testified: “I believe she should avoid heavy lifting, straining, stooping, since this first cystocele in 1968. I think any woman who has had that procedure done should avoid heavy work.”

Dr. Elkins testified that the only disability the appellant now has is that disability suffered by any woman 59 or 60 years old. He stated further that he felt any symptoms she displays currently are not related to her injury and the accompanying rectocele surgery. He said, “I do not relate the present symptoms that she [is] presented with, to any on the job problem, ...” He also stated, “I do not place any restrictions on this lady that I wouldn’t place on any other lady, an average normal lady of 59 to 60 years old.” Dr. Elkins concluded his testimony by saying he would not put any work restrictions on the appellant at the present-as a result of any gynecological problem.

The appellant contends Dr. Elkins’ testimony may not be considered substantial evidence because “he testified in favor of restrictions on Claimant’s work activity and against restrictions on Claimant’s work activities.” While it is true Dr. Elkins felt there might be tasks the appellant could not perform, he made it quite clear that any limitations she might have are the same as those of any other woman of comparable age. There appears to be no doubt as to Dr. Elkins’ opinion that the appellate has suffered no permanent disability as a result of the injury for which she has received temporary disability compensation.

The only cases cited by the appellant are Bottoms Baptist Orphanage v. Johnson, 240 Ark. 175, 398 S.W. 2d 544 (1966), which describes the cystocele and rectocele conditions, and Glass v. Edens, 233 Ark. 786, 346 S.W. 2d 685 (1961), which holds that factors other than functional or anatomical injury must be considered in determining permanent disability to the body as a whole. We are cited to no case dealing with inconsistency in a witness’s testimony and its effect, if any, upon whether that testimony may be regarded as substantial evidence.

The commission has determined the preponderance of the evidence supports the appellees’ contention that there is no permanent disability resulting from the injury. The commission might have found in the appellant’s favor, however, that is irrelevant to the issue before us which is whether substantial evidence supports the commission’s decision. See Johnson v. Volmac Industries, 269 Ark. 626, 599 S.W. 2d 440 (Ark. App. 1980). We find Dr. Elkins’ testimony is sufficiently definite to the effect that any disability of the appellant is unrelated to her recent injury. That is substantial evidence.

Affirmed.


author: Ernie E. Wright, Chief Judge. Marian F. Penix, Judge,

text:
    Ethel Bryant WILLIAMS v. Hubert H. BROOKS et al
    CA 79-236
    601 S.W. 2d 592
    Court of Appeals of Arkansas
    Opinion delivered July 9, 1980

      L. T. Simes, II, for appellant.

      Dan Kennett, for appellees.
   Ernie E. Wright, Chief Judge.

The appellant Mrs. Williams brought suit against Herbert H. Brooks and appellee Sheriff Larry Morris to recover damages and the value of her mobile home which was seized and sold by Sheriff Morris and his deputies acting under his direction pursuant to a writ of attachment Brooks caused to be issued upon a judgment he obtained in an earlier suit against appellant’s husband.

All parties moved for a directed verdict. The court granted a directed verdict in favor of Sheriff Morris, but denied the motions of appellant and Brooks for directed verdicts. The issues between appellant and Brooks were submitted to the jury resulting in a hung jury.

Appellant contends the trial court erred in submitting the case to the jury when appellant and defendants below all asked for directed verdicts.

As there has been no final order or judgment in the case against Brooks no action of the trial court in that phase of the litigation is subject to appeal, and we do not review same. The case remains on the trial docket subject to trial anew. McConnel & Son et al v. Sadle, 248 Ark. 1182, 455 S.W. 2d 880 (1970).

The issues before us for review are the alleged errors of the trial court in granting a directed verdict in favor of appellee Sheriff Morris, refusal to grant a directed verdict in favor of appellant, and refusal to allow evidence of appellant’s attorney fees as an element of damage.

The evidence is undisputed that Sheriff Morris and his deputies levied upon a mobile home owned solely by appellant pursuant to a writ of execution or attachment issued on a judgment in favor of Herbert H. Brooks against appellant’s husband, and thereafter removed and sold the property at public auction.

Article 9, § 7 of the Arkansas Constitution protects a wife’s separate property from seizure for debts of her husband.

Appellee Morris defended on the ground he was acting pursuant to a writ of attachment and court order issued in another action in which Brooks obtained a judgment against appellant’s husband. Appellant was not a party to that proceeding. Documents in the official court file in that case were identified by the clerk and offered and admitted in evidence, but were not incorporated as exhibits in the record brought forward on appeal. There is no indication counsel for Appellee Morris requested leave to substitute copies of the exhibits from the official files of the other case. The record does not disclose the precise contents of the writ of attachment under which the sheriff levied upon appellant’s mobile home. However, the evidence is clear appellant was not a party to the case out of which the attachment arose, and that the writ did not command the sheriff to levy upon property belonging appellant. The evidence shows the sheriff and his deputies were informed the mobile home was not the property of appellant’s husband. The evidence also reflects the sheriff required a bond from Brooks to protect himself against possible liability, but the bond was not produced or offered in evidence.

In Wright v. Husband, 193 Ark. 347, 99 S.W. 2d 583 (1936), the court held that where the sheriff, under a writ of attachment, took property from persons in no way connected with the original suit, after being told the property belonged to a third person, the taking was not innocent, but it constituted a willful tort.

We conclude there was substantial evidence to submit to the jury the issue of the sheriff s liability and damages, and that the court erred in directing a verdict in favor of the sheriff. It is error to direct a verdict where there is any substantial evidence tending to establish an issue in favor of the party against whom the verdict is directed. Home Mutual Fire Insurance Company v. Cartmell, 245 Ark. 45, 430 S.W. 2d 849 (1968).

As to appellant’s contention the court erred in failing to direct a verdict for appellant, which we consider only as to the case against the sheriff for reasons above stated, it may well have been appropriate for the court to direct a verdict in favor of the appellant as to liability on the part of the sheriff and leave it to the jury to determine the amount of the recovery. However, we do not find the rule authorizing such course to be mandatory. It is a matter within the trial court’s sound discretion. Lee Rubber & Tire Corporation v. Camfield, 233 Ark. 543, 345 S.W. 2d 931 (1961).

We find no merit in the assertion the trial court erred in refusing to permit appellant to make proof of her attorney fees as an element of damage, and appellant cites no Arkansas statute or case authorizing recovery of attorney fees in this type action.

Reversed and remanded for retrial as to all parties.

Penix, J., dissents.

Marian F. Penix, Judge,

dissenting. The majority is reversing this case because they find the record to be deficient and therefore they cannot determine whether the evidence supports the directed verdict granted Sheriff Larry Morris. While the record in this case is not the best, I find sufficient evidence to support the directed verdict.

The record reflects that the Judgment obtained by Hubert Brooks against Weston Williams as well as the writ of attachment were admitted into evidence as defendant’s exhibits during the testimony of Jane Henry, Circuit Clerk for Monroe County. These documents were identified, read and authenticated by Jane Henry and were admitted into evidence without objection. During Mrs. Henry’s testimony, she read the writ of attachment:

Q. Mrs. Henry, I believe it might be better if you would just read the substance of that petition.
A. This is headed, Petition. Comes Hubert H. Brooks, Plaintiff herein, and said property to be attached in his cause considered of a mobile home but the expense of clearing the same would be expected and would be to the best interests of all the parties herein to sell same and have the proceeds deposited in the register of this court and he so prays. The next, is an Order, which was
Q. Read that, too.
A. filed in my office on the 27th of February, 1978. It is headed Order. On this 24th day of February, 1978, comes to be heard petition of Hubert H. Brooks, plaintiff herein, for sale of following property in the possession of Larry Morris, the Sheriff of Monroe County under levy and writ of attachment in this suit, a mobile home, and from other proof and matters and things before the Court, this Court doth find the cost of caring for it would be excepted and not warranted and that it would be to the best interests of the parties to this suit to sell the same. It is therefore by the court ordered that the property above described be sold by the sheriff of said county at public outcry to the highest bidder for cash and make a due report of such sale to this Court, Signed by Circuit Judge W. N. Lee.

No objection was made to this testimony which states the writ of attachment was issued for a specific piece of property. Furthermore, Sheriff Larry Morris testified the writ of attachment was issued for a specific piece of property, namely the mobile home. This evidence is undisputed.

The evidence presented at trial revealed Sheriff Morris was issued a writ of attachment directing him to seize the mobile home. The writ was specific in the item of property to be seized to satisfy the judgment. No evidence was given which would indicate the writ was in any way improperly issued. Sheriff Morris had no choice but to execute on the property. The burden is not on the sheriff to determine the validity of an execution order. In fact, the sheriff faces liability if he does not execute on the property. Ark. Stat. Ann. § 30-1001 provides:

Liability of officer for whole amount of execution — Indorsement of time of return. — If any officer, to whom an execution shall be delivered, shall neglect or refuse to execute or levy the same according to law, . . . each officer shall be liable and bound to pay the whole amount of money in such exécution specified, or thereon indorsed, and directed to be levied; . . .

The Supreme Court, in interpreting this statute, stated:

A sheriff has no discretion in carrying out an execution ordered by a court of competent jurisdiction toward the satisfaction of a valid judgment. Indeed, a sheriff is subject to severe penalties if he fails to do so. In addition to other statutory penalties, a sheriff is liable for the whole amount of the execution if he fails or refused to levy ft. Saxon v. Purma, 256 Ark. 461, 508 S.W. 2d 331 (1974).

I would affirm the granting of the directed verdict for Sheriff Morris. While I have no quarrel with the law expressed in the majority opinion which discusses a married woman’s property rights and her lack of liability for her husband’s debts, that is not the issue before us. It simply has no relevance with regard to the liability of Sheriff Larry Morris. Therefore, I respectfully dissent.


author: Ernie E. Wright, Chief Judge.

text:
    Betty Sue PARKER and Carol Jane PARKER Co-Executrixes of the Estate of Parker Parker, Deceased v. Alfred W. PLEDGER et al
    CA 80-110
    601 S.W. 2d 897
    Court of Appeals of Arkansas
    Opinion delivered July 9, 1980

      Gardner & Gardner, by; Richard E. Gardner, Jr., for appellants.

      Richard L. Peel, for appellees.
   Ernie E. Wright, Chief Judge.

Appellants coexecutrixes of the estate of Parker Parker, deceased, appeal from a decree of the chancery court dismissing the estate’s petition to reform and foreclose a second mortgage upon the home of appellee Pledger. F.H.A. holds the first mortgage on the real estate and for this reason the United States of America was made a party to the action.

Appellee Pledger borrowed $50,000 from the Bank of Russellville, hereinafter referred to as the Bank, in November, 1972, and secured the loan with a mortgage on a store building and fixtures and inventory. Parker Parker, an attorney now deceased, signed the $23,000 note as a surety and to protect himself obtained the signature of Pledger on an instrument dated October 18, 1974, referred to as note and also on a real estate mortgage to secure said note. The description in the mortgage called for Lot 9 of Parkhill Addition to Dardanelle, and the mortgage recited the existence of a prior mortgage of record but does not identify the prior mortgage. The document referred to as a note reads as follows:

$23,000.00 Dardanelle, Arkansas 10/18- 1974
24 Monthly after date due in equal promise to pay -or order Payments Payable at First National Bank — Dollars Russellville as Addition Security for Parker Parker endorsing Alfred Pledger Note to said Bank for value received, with interet at the rate of 10 per cent per annum from date until paid, interest payable annually. If interest be not paid annually, to become as principal and bear the same rate of interest. Witness My hand and seal.
I si Alfred W. Pledger (Seal)

The Bank on October 24, 1972, assigned to Parker Parker without recourse the $50,000 note, and on October 14, 1976, assigned to him the original $23,000 note dated October 17, 1974, along with a renewal note for the same dated October 29, 1975, together with the security agreement.

On October 27, 1976, Pledger was adjudicated a bankrupt and the Parker estate thereafter on June 10, 1977, filed its amended claim as a secured creditor for the sum of $43,920.78 on the $50,000 note and the sum of $14,177.28 on the $23,000 note. Thereafter the bankruptcy judge allowed the amended claim in favor of the Parker estate in the total sum of $58,986.00. The real estate and personal property securing the indebtedness evidenced by the two notes were sold in the bankruptcy proceeding and the trustee paid the estate the sum of $49,971.98. Pledger was released by the bankruptcy court from all dischargeable debts on February 28, 1977.

Thereafter, appellants filed an action on the above mentioned note and mortgage held by Parker estate, sought judgment for $24,932.96 and foreclosure on Lot 9 of Parkhill Addition. Later appellants filed an amended petition reducing the amount alleged to be due the estate to $17,239-35. In January, 1979, appellants further amended their petition and alleged there was a scrivener’s error in the land description to Lot 92 of Parkhill Addition.

Appellee answered the petition denying indebtedness to the estate and pleading his discharge from bankruptcy as a further defense. In addition he alleged the October, 1974, $23,000 note to the Bank, which Parker co-signed was released by the execution of a renewal note; and Parker thereafter became the owner of the renewal note and the only security for payment was the personal property in the security agreement.

At trial Pledger testified he had no knowledge of having executed the mortgage on Lot 9 of Parkhill Addition to Dardanelle or the document referred to in the mortgage as a promissory note, but the signature on each was his signature. He had never owned Lot 9, but does own Lot 92 of Parkhill Addition which is his home. His home was not disturbed in the bankruptcy proceeding, and he testified it was supposed to be encumbered only by the F.H.A. mortgage. He denied his signature was affixed to the documents knowingly and denied acknowledging the mortgage before a notary public. The notary who executed the acknowledgement of the mortgage testified she had no recollection of the document or of Pledger acknowledging it. Pledger further testified Parker frequently got him to sign documents in blank which Parker did not allow him to read. The evidence does not show what part of the $49,971.98 paid out of the bankruptcy assets was produced by the sale of assets securing the $23,000 note Parker cosigned.

Appellant Betty Sue Parker, the only witness testifying as to the amount of the alleged indebtedness, testified the debt was $9,126.08, but modified her testimony to state the amount to be $8,126.08. She was unable to explain how the figure was determined other than taking the claim as allowed by the bankruptcy court and subtracting the amount paid the estate by the trustee, leaving a net balance of $8,126.08.

At the conclusion of the evidence of the court held the mortgage in question was security to Parker for a $23,000 note on the Bank he co-signed for Pledger on or about the same date, that the note to the Bank had been satisfied by a renewal note, and that the mortgage in issue does not extend security to assure payment of the renewal note of the Bank executed in October, 1975. Decree was entered dismissing the complaint.

For reversal appellant contends the trial court erred in finding the mortgage in issue was extinguished by renewal of the $23,000 note to the Bank, and erred in failing to reform the mortgage and grant foreclosure.

We conclude the trial court based its decision on an erroneous conclusion of law and that the execution of a renewal note for $23,000 in October, 1975, did not operate to extinguish the debt for which the original October, 1974, note was executed. The original note was retained by the Bank and later assigned to Parker along with the renewal note, and the renewal was merely an extension of time for the payment of the debt. Bank of Dermott v. Measel, 172 Ark. 193, 287 S.W. 1017 (1926). However, we review chancery appeals de novo, and if we determine from the record the result of the decree to be correct, we affirm, even though the reason given by the trial court is incorrect. Apple v. Cooper, 263 Ark. 467, 565 S.W. 2d 436 (1978).

First, we conclude the indebtedness was not established by the evidence. The only witness who attempted to establish the indebtedness did not produce in court underlying data to establish an unpaid balance on the' $23,000 note to the Bank other than the copy of the order of the bankruptcy court allowing the claim in favor of the Parker estate on the two secured notes in the total amount of $58,098.06, and that $49,971.98 was paid on the claim by the trustee. No other payments had been made from any source after allowance of the claim. However, the mere allowance of an uncontested claim by the bankruptcy court simply determines the creditor is entitled to a dividend out of the bankruptcy assets in the hands of the trustee. Such an allowance is not res judicata and does not estop the bankrupt from defending a subsequent suit by the creditor. The allowance of an uncontested claim is not binding on the bankrupt except as to the assets in the bankruptcy proceeding. 8A C.J.S. Bankruptcy § 444; Walley v. United States, 259 F. 2d 579 (1958); United States v. Verrier, 179 F. Supp. 336 (1959). Appellee denied any unpaid indebtedness and failure of appellant to establish the debt by competent evidence supports dismissal of the complaint.

Secondly, the document bearing the signature of Pledger and offered in evidence by appellants as a note is not in fact a note. A note whether it be a negotiable instrument or otherwise, must contain a promise to pay to the bearer or an identified payee. The instrument which appellants present as a basis for the mortgage does not name a payee and is not payable to the bearer. It is neither a negotiable nor nonnegotiable note. Ark. Stat. Ann. § 85-3-102(l)(b) requires that to be negotiable the instrument to whom the promise to pay is addressed must be identified with reasonable certainty. The instrument here in question refers to payments payable at the Bank and contains no express promise to pay bearer or any named person.

In 10 C.J.S., Bills and Notes, § 7 (4) b, it is stated a note must include the following:

Payment must be promised absolutely and unconditionally for the instrument to be a note, either negotiable or nonnegotiable. If the instrument contains no promise to pay, it cannot be a note.

We are unable to say the instrument here contains an absolute and unconditional promise to pay. In fact, the evidence shows the document was never intended to be an unconditional promise to pay, but it purports to provide security to the co-signer for payment of the note held by the Bank. Thus, appellants concede the note was intended only to be a conditional obligation. It should be kept in mind that the Parker estate would not be entitled to recover a deficiency under the $23,000 noté assigned to Parker by the Bank as any balance of that obligation was released upon the discharge of Pledger from bankruptcy.

We conclude the instrument is not a note securing a debt to the Parker estate. Pledger was not indebted to Parker when the document was executed and the document contains no promise to pay Parker. The instrument creates no obligation for the mortgage to secure, and appellants are not entitled to foreclose.

Third, we conclude the evidence for reformation of the description in the mortgage does not warrant reformation. Before reformation may be granted because of mistake the mistake must be mutual. Jeffers v. American Pioneer Life, Inc. Co., 256 Ark. 332, 507 S.W. 2d 713 (1974). There was no testimony that Pledger intended to give Parker a second mortgage on his home property. On the contrary, Pledger testified he never agreed or intended to mortgage his home to Parker, and that he did not knowingly execute the mortgage or appear before a notary and acknowledge same. The notary had no recollection of the mortgage, and Pledger further testified Parker often insisted upon his signing instruments that were blank. To justify the court in reforming the instrument, the evidence must be clear, cogent and decisive. North v. Griffin, 227 Ark. 402, 298 S.W. 2d 700 (1957). We conclude the evidence in favor of reformation does not meet that test.

Affirmed.


text:
    Wayne HARBOUR v. Chloe F. Harbour SHEFFIELD
    CA 80-128
    601 S.W. 2d 595
    Court of Appeals of Arkansas
    Opinion delivered July 9, 1980

      Charles E. Davis, of Davis, Bracey & Heuer, P.A., for appellant.

      Willis V. Lewis, for appellee.
   Ernie E. Wright, Chief Judge.

The appellant Wayne Harbour appeals from a decree of the chancery court quieting title to 180 acres of land in Montgomery County in the appellee Chloe F. Harbour Sheffield and reforming a deed from L.L. Beavers and wife by which her late husband Russell Harbour acquired title in July, 1941.

The appellant answered appellee’s petition to reform the deed and quiet title and claimed ownership of an undivided interest in the land as an heir of his late brother Russell Harbour who died intestate and without issue in 1966. By counter-petition he also sought partition of the land.

The appellee upon the death of her husband became the owner of a one-half undivided interest under the dower statute, and she subsequently acquired by quitclaim deeds from her late husband’s heirs all of the outstanding interests except a one-sixth undivided interest which passed to the appellant.

Appellee and Russell Harbour were married in 1934. In 1941, he acquired a deed to the land in question from Mr. and Mrs. Beavers. The appellee was not present at the closing of the transaction and no one who participated in the preparation of the deed or the closing of the transaction testified. Appellee testified she joined in signing the papers to borrow the money to purchase the land in 1941, and the evidence shows she worked with her husband in operating and improving the farm. She had assumed her name was on the deed until she learned otherwise after her husband’s death in 1966. She was appointed administratrix of her husband’s estate and listed the land in question as belonging to the estate in the verified probate court inventory. The final probate court order discharging the administratrix recited title to the lands, “as still in the estate”.

The evidence shows appellee continued to live upon the land for sométime after her husband’s death, but she later remarried and the record is not clear as to whether she has abandoned her homestead.

I.

Appellant contends the trial court erred in reforming the 1941 deed to include the name of appellee as a grantee along with that of her late husband on the ground there was a mistake in the deed in failing to include appellee’s name.

The law requires that to warrant reformation of the deed the evidence must be clear and convincing. Duckson v. Wolfe, 235 Ark. 855, 362 S.W. 2d 427 (1962). We do not find clear and convincing evidence in the record that either the grantors or the grantee in the 1941 deed intended the deed to include the appellee as a grantee or that there was a mistake in the deed in omitting the name of the appellee.

There is another compelling reason the court erred in reforming the deed. Neither the grantors or their heirs were parties to this action, and they would be necessary parties to an action for reformation. McClelland v. McClelland, 219 Ark. 255, 241 S.W. 2d 264 (1951).

II.

Appellant contends the chancellor erred in holding the appellee had perfected title to the land by adverse possession and in quieting fee title to the land in appellee as against appellant.

Upon the death of appellant’s husband, intestate and without issue, the appellant under the dower provisions of Ark. Stat. Ann. § 61-206 became the fee owner of a one-half undivided interest in the land. She thereafter acquired the outstanding interests of the heirs at law of her late husband except the undivided one-sixth interest which vested in appellant as an heir of Russell Harbour. The appellant and appellee thus became co-tenants upon the death of appellee’s husband.

The law is settled that possession by a co-tenant is presumed to be possession by all of the co-tenants, and the pressumption continues until there is some act sufficient to give notice to co-owners that the one in possession is claiming ownership to the exclusion of the others having an interest in the property. Baxter v. Young, 229 Ark. 1035, 320 S.W. 2d 640; Newman v. Newman, 205 Ark. 169 S.W. 2d 667 (1943).

Here the appellee in a verified inventory filed in the probate proceedings upon her late husband’s estate recognized the land as belonging to the estate. There is no substantial evidence that appellee at any point prior to the filing of this suit took any action to clearly bring home notice to appellant she was claiming ownership of the land adverse to him. There is abundant evidence that she desired that appellant give her his outstanding interest, and asked him for a quitclaim deed.

III.

Appellant asserts the court erred in failing to order partition of the land on his counter-petition.

The evidence is not clear or fully developed as to whether the appellee continues to hold the land as her homestead. If so, it is not subject to partition except by her consent. Article 9, § 6 of the Constitution; Henderson v. Henderson, 212 Ark. 31, 204 S.W. 2d 911 (1947); Gibson v. Gibson, 264 Ark. 420, 572 S.W. 2d 148 (1978). If the land is no longer the homestead of appellee, the trial court should grant partition as provided by Ark. Stat. Ann. § 34-1801 (Repl. 1962).

As we conclude the findings of the chancellor were clearly contrary to the preponderance of the evidence as to reformation of the deed and as to ownership of the land by appellee by reason of adverse possession, we reverse on those points, and hold appellant owns a one-sixth undivided interest in the land.

We remand the case for further proceedings consistent with this opinion upon appellant’s counter-petition to partition the land, and direct that the parties be permitted to present further evidence to clarify whether appellee has homestead rights in the land.


author: Steele Hays, Judge.

text:
    WILBANKS & WILBANKS, INC. and FIRST BANK AND TRUST OF JONESBORO v. Bill COBB
    CA 80-111
    601 S.W. 2d 601
    Court of Appeals of Arkansas
    Opinion delivered July 9, 1980

      Mooney & Boone, by: Joe C. Boone and Dennis Zolper, for appellants.

      Warren E. Dupwe, for appellee.
   Steele Hays, Judge.

This is a case involving conflicting claims to the remaining proceeds of a fire insurance policy. Appellant, Wilbanks & Wilbanks, Inc., entered into a contract to purchase a dental laboratory business from appellee, Bill Cobb. The total purchase price was .$35,000.00, and the contract valued the equipment at $20,000.00. Subsequently, appellant entered into a security agreement with appellee covering “all equipment and inventory located at 215 East Monroe, Jonesboro, Arkansas, as of this date and used in the Cobb Dental Laboratories located at the above address.” The security agreement itemized all the “equipment and inventory” used at Cobb Dental Laboratories. Approximately four months later, appellant purchased new equipment costing $7,035.74 which was to be used to create a new department. Appellant, First Bank and Trust of Jonesboro, financed part of the equipment and required appellant Wilbanks & Wilbanks, Inc., to enter into a security agreement in the amount of $5,600.00. Both security agreements required Wilbanks & Wilbanks, Inc., to provide fire insurance covering the property with loss payable clause for the benefit of the secured party.

Consequently, Wilbanks & Wilbanks, Inc., procured an insurance policy covering all equipment in the amount of $30,000.00 and named appellee as loss payee of the policy.

In September of 1978, a fire occurred which partially damaged the used equipment and completely destroyed the new equipment to be used in the new department.

The insurance carrier paid $13,093.26 for the loss which included $7,035.74 representing the full value of the new equipment. Appellee has received $7,093.26 of the insurance proceeds, plus the return of equipment which presumably was not damaged. Cobb then filed suit claiming the remaining proceeds as loss payee under the insurance policy. Appellant First Bank & Trust intervened, maintaining that it has a purchase money security interest and an equitable lien on the insurance proceeds and that it should receive the balance of the proceeds. The Chancellor held in favor of the appellee, and appellants bring this appeal.

The sole issue for determination on appeal is whether Bill Cobb can be allowed to keep the entire proceeds of the insurance policy in accordance with the law in Arkansas. We cannot find an Arkansas case directly in point. Couch, Insurance 2d § 29:65 (I960) states:

A loss payable clause gives the payee thereunder a superior right in the proceeds to the extent of his interest and the insured can only recover any balance in excess thereof.

Also, in the same treatise at § 29:71, it is stated:

Regardless of the use of broader terms in the policy, a mortgagee is only entitled to indemnity with respect to the property which. was bound by the mortgage, although the policy extended to the property which was not so subject. Under fire insurance policies covering both real and personal property and payable by endorsements to the mortgagee as his interest may appear, ■ the mortgagee is not entitled to retain the proceeds of the insurance upon the personal property merely by reason of the mortgage clauses and its possession of the policies at the time of the fire, since the mortgagee’s only interest as such is in the real estate covered by the mortgage.

By analogy, we can apply this same principle of law in this case to the extent that the mortgagee can only retain the insurance proceeds, that, cover his interest in the property. Appellee had no interest in the new equipment which was to be used for an entirely new department of the business. In fact, the security agreement covering the equipment was executed approximately three months before any of the new equipment was bought. The security agreement specifically states that it covers all equipment “as of this date” and also itemizes the inventory covered by the agreement. Hence, the contract, by its own terms, is expressly limited to existing equipment at the time the security agreement was executed.

Generally speaking, insurance proceeds are payable only to the person whose interest is covered by the policy, provided he has an insurable interest at the time of the making of the contract and at the time of the loss. National Bedding and Furniture, Inc. v. Clark, 252 Ark. 780, 481 S.W. 2d 690 (1972). Ark. Stat. Ann. § 66-3205 (Repl. 1966) states:

(1) No contract of insurance of property or of any interest in property arising from property shall be enforceable as to the insurance except for the benefit of persons having an insurable interest in the things insured at the time of the effectuation of the insurance and at the time of the loss.
(2) “Insurable interest” as used in this section means any actual, lawful, and substantial economic interest in the safety of [or] preservation of the subject of the insurance free from loss, destruction, or pecuniary damage or impairment.

In the absence of any substantial economic interest, i.e., where Claimant has suffered no actual loss of cash or property, he has no insurable interest. Dixon v. State, 260 Ark. 855, 544 S.W. 2d 853 (1977); Briscoe v. National Union Fire Insurance Company, 248 Ark. 220, 451 S.W. 2d 205 (1970). Here, claimant had no insurable interest in the new equipment either at the time of the making of the contract or at the time of the loss.

One other point should be mentioned. While the loss payable clause of the insurance policy does not appear anywhere in the record, we are not precluded from taking note of the language which is customary in most insurance policies, i.e., that the proceeds of the policy are payable to the loss payee as his interest may appear and not as payee generally. Therefore, appellee’s interest under the policy cannot exceed his interest in the insured property itself. The interest of the appellee in the insured equipment did not extend to the new equipment.

For the reasons stated above, the case is reversed and remanded with direction to enter a judgment in accordance with this opinion.

Reversed and remanded.


text:
    Vernal E. BARNETT v. SOUTHWESTERN LIFE INSURANCE COMPANY
    CA 80-127
    601 S.W. 2d 604
    Court of Appeals of Arkansas
    Opinion delivered July 9, 1980

      Bradley & Coleman, by: Douglas Bradley, for appellant.

      Barrett, Wheatley, Smith & Deacon, by: Stephen M. Reasoner, for appellee.
   Steele Hays, Judge.

This appeal involves two policies of life insurance issued by the Appellee, Southwestern Life Insurance Company, insuring the life of the Appellant, Vernal E. Barnett. One policy was for ten thousand dollars, issued on April 19, 1962, and one for ninety thousand dollars, issued on June 10, 1968.

Both policies carried “Premium Waiver Riders” providing that if the insured became totally disabled prior to the policy anniversary date following his 60th birthday, the company would refund any premiums already paid within the preceeding six months and, further, would waive all premiums as long as disability continued. The riders provided several means of termination, including: “This rider will automatically terminate and cease to be in force on . . . the policy anniversary nearest the Insured’s 60th birthday unless the Insured is then totally disabled within the meaning of this rider and the required proof of such disability shall have been furnished not later than nine months after such policy anniversary ...”

Total disability was defined in the riders as being the result of bodily injury occurring or disease contracted after the policy was issued and before the policy anniversary nearest his 60th birthday which prevented his engaging in any business or occupation and from performing any work for compensation or profit, regardless of the relationship of such business, occupation or work to any in which the Insured was previously engaged.

The riders contained a paragraph entitled NOTICE OF CLAIM, stating that the company would not be liable for any benefits under the rider unless written notice of claim was given to the company during the lifetime of the Insured and the continuance of total disability, but failure to give such notice within the time provided would not invalidate any claim if it were shown that it was not reasonably possible to give such notice within such time and it was given as soon as reasonably possible.

Also, the rider contained a paragraph entitled PROOF OF TOTAL DISABILITY, providing that written proof satisfactory to the company that the Insured was totally disabled within the meaning of the rider must be furnished to the company while the rider is in force (or up to nine months after the policy anniversary nearest the Insured’s 60th birthday) and that the furnishing of proof in the manner and time specified was a condition precedent to any liability under the rider.

The Insured’s 60th birthday was October 21, 1975 and, consequently, the termination date under one rider was July 10, 1976, and April 19, 1976, under the other.

It is Appellant’s position that he became totally disabled on or before December 15, 1975, but failed to give the notice of . claim or proof of disability inasmuch as he either did not know or had forgotten that the policies had waiver premium riders until June 28, 1978, when notice was then promptly given to the Appellee.

Appellee declined to honor Appellant’s requested waiver of premiums and suit was filed seeking judgment for premiums already paid and for a declaratory judgment declaring future premiums waived pursuant to the provisions of the riders.

The learned Chancellor found that the Appellant was obligated to provide written proof of his disability while the rider was in force and not later than nine months after the next policy anniversary following Appellant’s 60th birthday; that such proof was a condition precedent and was not met by the June 28, 1978, letter. The Chancellor also found that the proof failed to show that Appellant suffered under such mental disability as to excuse his obligation to give notice of disability, assuming that notice could be excused thereby. From the decree so entered, Appellant brings this appeal.

It is argued that a literal interpretation of the NOTICE OF CLAIM paragraph means that proof of disability may be given at any time total disability exists while the Insured is still living. But that argument is not convincing, as the rider plainly states in two places that the occurrence of disability has a cut-off date at the policy anniversary nearest the 60th birthday of the Insured and that yet a third place in the rider appears a paragraph entitled TERMINATION OF THIS RIDER in bold type which describes among other methods, the automatic termination of the rider at the policy anniversary nearest the Insured’s 60th birthday. Thus, an interpretation that the proof of disability could be given at any time the Insured was still living after disability had occurred would require ignoring clear and repeated language in the rider regarding the termination of the right to claim waiver of premium.

The argument is also advanced that allowing the Insured to give notice of disability after the time specified in the rider does not deprive the Insurer of the opportunity to offer evidence of disability of the Insured, inasmuch as the Insurer could still investigate, retroactively as it were, and satisfy itself that the Insured was in fact disabled on or before December 15, 1975. We find no merit in this argument. What seems to be indisputable to Appellant in June of 1978 may not have been so evident to the Insurer in December of 1975, the time at which the Insurer had the right to examine the proof and weigh the Insured’s condition with respect to total disability as defined under the law and in the policy. The Insurer might even have elected to have independent medical examinations performed. We believe that the timely exercise of the right is material and is of such importance that it should not be denied by stretching the termination date in the rider many months beyond the stated time.

Appellant contends that his disability involved his mind and mental alertness and that the savings clause in the paragraph entitled NOTICE OF CLAIM provides that a failure to give notice of disability is excused if it is shown that it was not reasonably possible to give such notice within the time required. It follows, according to the argument advanced, that notice was given to the Appellee as soon as reasonably possible. But the Chancellor found, rightly we believe, that the evidence of mental disability fell short of proving that the disability was of such degree as to excuse the failure of notice under the savings clause. The law requires a much greater quantum of mental infirmity than is shown to have been present in the case at hand. Pfeifer v. Missouri State Life Insurance Company, 174 Ark. 783, 297 S.W. 847 (1922); Old Colony Life Insurance Company v. Julian, 175 Ark. 359, 299 S.W. 366 (1927). But an equally telling answer to this argument is that the Chancellor found that the furnishing of evidence of total disability was a condition precedent to liability under the policy, as opposed to a condition subsequent, and that such a condition was not met by the June 28, 1978 letter. We believe that the finding is consonant with the holding in New York Life Insurance Company v. Moose, 190 Ark. 161, 78 S.W. 2d 64 (1935).

It is suggested that the denial of waiver of premiums where the Insured did in fact become totally disabled while the rider was in force amounts to a forfeiture, which equity abhors. Squire v. Squire, 253 Ark. 506, 486 S.W. 2d 910 (1972), but there is no real forfeiture present here, in the strict sense of the word, merely the resemblance. The classic example of forfeiture involves purchases of lands or goods, usually, in which the purchasers fail to meet a time requirement and are confronted with the loss of their investment simply because of the lapse, with no consequential deprivation to the opposing party. Although equity abhors a forfeiture and will seize upon the slightest circumstance to invalidate one, equity also recognizes forfeitures and validates them where a refusal to do so would be inequitable. White v. Page, 216 Ark. 632, 226 S.W. 2d 973 (1950). We think that balancing the equities in the case before us requires the upholding of the clear language of the rider. That is not to ignore the dilemma presented by this case. It is regrettable that Appellant failed to avail himself of the opportunity to have premiums waived, but that failure was the result of his own omission and it would be an inequity of somewhat greater proportions, we conclude, to transfer the burden of the omission to the opposing party, where to do so would require a wholesale rewriting of language of the policy. The many precedents on that general subject require that policy language, if plain, be adhered to. Ingram v. Life of Georgia, 234 Ark. 771, 354 S.W. 2d 549 (1962).

Affirmed.