author: J. Fred Jones, Justice.

text:
    WILSON & CO., INC. v. John CHRISTMAN
    5-4472
    424 S. W. 2d 863
    Opinion delivered February 19, 1968
    [Rehearing denied April 1, 1968.]

      Crouch, Blair & Cypert, for appellant.

      Lewis E. Epley, for appellee.
   J. Fred Jones, Justice.

This is a workmen’s compensation case involving a back injury. The respondent accepted responsibility for a 27% permanent partial disability to the body as a whole based on medical evidence', but controverted any percentage in excess, of that amount. The referee, and the full Commission on review, awarded compensation for a 60% permanent partial disability and this award was affirmed by the circuit court on appeal. The respondent has appealed to this court and relies upon the following point for reversal:

‘ ‘ The court erred in affirming the order and award of the Arkansas Workmen’s Compensation Commission for the reason that there was not substantial competent evidence in the record upon which to base such order and award.”
Ark. Stat. Ann. § 81-1310 (a) (Repl. 1960) provides :
“* * * Compensation payable to an injured employee for disability shall not exceed sixty-five per centum (65%) of his average weekly wage at the time of the accident, and shall not be greater than thirty-five dollars ($35.00) per week, nor less than seven dollars ($7.00) per week, and shall be paid for a period not to exceed 450 weeks of disability, and in no case shall exceed twelve thousand five hundred dollars ($12,500.00), in addition to the benefits and allowances under section 11 [§ 81-1311] hereof. The minimum and maximum limitations of time and money expressed in the foregoing sentence shall apply in all cases pertaining to the payment of money compensation on account of disability.”

Ark. Stat. Ann. <§, 81-1302 (e) (Repl. 1960) defines disability as follows:

“ ‘Disability’ means incapacity because of injury to earn, in the same or any other employment, the wages which the employee was receiving at the time of the injury.”

Ark. Stat. Ann. § 81-1313 (c) (Repl. 1960) provides for scheduled injuries as follows:

“An employee who sustains a permanent injury scheduled in this subsection shall receive, in addition to compensation for the healing period, sixty-five per centum [65% ] of his average weekly wage for that period of time set out in the following schedule:
(1) Arm amputated at the elbow, or between the elbow and shoulder, two hundred [200] weeks; [This subsection then enumerates a total of 20 scheduled specific losses and sets out their value in weeks.]
# # #
(21) Total loss of use: Compensation for permanent total loss of use of a member shall be the same as for amputation of the member.
(22) Partial loss or partial loss of use: Compensation for permanent partial loss or loss of use of a member shall be for the proportionate loss or loss of use of the member.
(d) Other cases: A permanent partial disability not scheduled in subsection (c) hereof shall be apportioned to the body as a whole, which shall have a value, of 450 weeks, and there shall be paid compensation to. the injured employee for the proportionate loss of use of the body as a 'whole resulting from the injury.” (Emphasis supplied.)

Thus, it is seen that we actually have two types of disability, or two criteria, for measuring compensable disability, set out in our workmen’s compensation statute. Disability under the definition section, § 81-1302 (e), supra, is measured by “incapacity because of injury to earn” and loss of wages is a prime factor. The disability referred to under the scheduled injury section, % 81-1313 (c), supra, is measured in number of weeks of compensation and partial loss of the use of the body as a whole is the prime factor under § 81-1313 (d).

Thus, an injured employee who suffers a permanent partial loss of the use of his body is entitled to paymént of compensation for the number of weeks the percentage of such loss bears to 450 weeks. This loss of use-may consist of physical functional loss only, and its duration ¿nd extent may 'best be measured through physical examination by competent medical specialists. This permanent partial loss of use to the body may or may not also result in incapacity to earn the same wages received at the time of injury. An accidental injury under this subsection may result in a permanent partial disability consisting only of a partial loss of use of the body as a whole and with no change in earning capacity at all. An injured employee is entitled to the payment of compensation, however, for this loss of use whether his earning capacity is diminished by the injury or not. Dockery v. Thomas, 229 Ark. 984, 320 S. W. 2d 257. Where the permanent partial disability consists also of an incapacity, because of the injury to earn wages as defined and set out in § 81-1302 (e), supra, such disability includes, blends in with, and is usually greater than the disability occasioned by loss of functional use only.

The case of Glass v. Edens, 233 Ark. 786, 346 S. W. 2d 685, was a compensable heart case involving permanent partial disability including incapacity to earn wages. The maximum medical rating of disability, apparently based on functional loss of use to the body as a whole, amounted to 40%. The referee, in awarding compensation for a permanent partial disability of 40% to the body as a whole, failed to distinguish the two methods of measuring disability, as evidenced in his opinion, stated as follows:

“ 'In the case of Jesse A. DeBin v. Kaiser Engineers, reported Yol. 214, page 3 of the Opinions of the Full iCommission, the Commission held that evidence other than clinical findings cannot be considered to arrive at a rating for permanent partial disability. I must therefore only consider the medical rating of disability.’ ”

The award of the referee in the Glass case was sustained by the Commission and affirmed by the circuit court. The judgment of the trial court was reversed on appeal, and after quoting from Larson on Workmen’s Compensation Law, § 57.10, this court said:

“The maximum medical rating of disability in this case was 40%, which was allowed by the referee and affirmed by the Pull Commission. Apparently, they also considered only medical evidence and this we consider error. Under the rules as set out in Larson, consideration should have been given, along with the medical evidence, to the appellant’s age, education, experience, and other matters affecting wage loss.”

An excellent and pointed article analyzing Glass v. Edens, as distinguished from, and compared with, cases from other jurisdictions, is found in Arkansas Law Review, Yol. 18, p. 269. As recognized in this article, the rule laid down in the Glass decision is that the proper determination of the extent of permanent partial disability is reached through a balancing of wage loss disability (where wage loss is involved) with physical, functional disability.

The rule laid down in the Glass ease was affirmed and clarified to some extent in the case of Mann v. Potlatch Forests, 237 Ark. 8, 371 S. W. 2d 9, wherein the claimant liad been awarded compensation for a permanent partial disability of 25% to the body as a whole because of a back injury. He later, claimed a greater disability contending that the doctors had not considered his age, occupation, etc. as they should have done in arriving at their estimate of his permanent partial disabilty, and as was required that they should do by the decision in the Glass case. In affirming the Commission in the Mown case, this court reaffirmed the holding in the Glass case, that consideration should be given, along with medical evidence, to the appellant’s age, education, experience, and other matters affecting wage loss. The case was affirmed, however, on the ground that the Commission did take these elements into consideration. In the Mann case, this court further clarified the Glass opinion in these words:

“The Glass opinion places the duty on the Commission, and not the doctor, to consider the elements mentioned above. In the cited case we said: ‘Apparently, they also considered only medical evidence and this we consider error.’ The word “they” obviously refers to the Commissioners and not the doctors. In the next place, appellant is in no position to contend the Commission failed to take into consideration his age, occupation, etc. The record shows that the Commission was made aware of our holding in the Glass case, and we cannot say it did not follow that holding here in arriving at appellant’s disability.”

The workmen’s compensation Commission is charged with the duty and the full responsibility of deciding all claims for disability falling under its jurisdiction, and although its decisions are based on competent evidence, it is not limited, and never has been limited, to medical evidence only in arriving at its decision as to the amount or extent of permanent partial disability suffered by an injured employee as a result of injury. The Commission should consider all competent evidence, and where the claim is for permanent partial disability based on incapacity to earn, the Commission should consider all competent evidence relating to such incapacity, including the age, education, experience, and other matters affecting the claimant’s incapacity to earn the same Wages he was receiving at the time of his injury. The Commission should form its opinion and base its award on the preponderance of all the competent evidence, including medical, as well as layjfcestimony, and also including the testimony of the claimant himself. The Commission weighs all of the evidence as a jury would do and we affirm the order or award of the Commission on appeal unless the Commission acted without, or in excess of its powers; unless the order or award was procured by fraud; unless the facts found by the Commission do' not support the order or award; or unless there was not sufficient' competent evidence in the record to warrant the making of the order or award. [Ark. Stat. Ann. § 81-1325 (b) (Repl. 1960).] We have many times held that the findings of fact made by the Commission are entitled to the same force and effect as a jury verdict, and will not be disturbed on appeal if supported by substantial evidence. (Hollifield v. Bird & Son, Inc., 227 Ark. 703, 301 S. W. 2d 27.)

Turning now to the case at bar, the appellee was 24 years of age when he was injured. He had an eighth grade education and quit school to help support his mother and brothers and sisters when he was sixteen years of age. He was married at the time of his injury, and has two children of his own. Appellee was more or less an itinerant worker. He changed jobs rather frequently, but seemed to lose little time between jobs. All the jobs appellee ever did, or knew how to do, consisted of heavy manual labor, ranging from cutting and carrying mining posts in Pennsylvania, to dipping chicken off-fall from a vat with a bucket in Fayetteville, where he was injured. The appellant agrees with our holding in Glass v. Edens, supra, but argues that the appellee in the case at bar has failed to prove that he has a permanent partial disability in the magnitude of 60%.

Appellee underwent an operation for the removal of a herniated intervertebral disc. He testified at the hearing that he was in constant pain and had been since his injury. Two of his former employers testified that they could not re-employ him because of incapacity to work as reflected by the medical reports in evidence.

Dr. Tom P. Cocker on May 10, 1966, reported as follows:

“I do not believe that there is likelihood of further improvement as far as the back is concerned although the patient should continue on exercises' in that hope.
“I do not think that he will be able to return to manual type work or anything that requires repeated bending, stooping, lifting or prolonged standing or walking. It is my opinion that the patient has a permanent partial disability to his body as a whole of 25%.”

On June 8, 1966, Dr. William G-. Lockhart, a neurosurgeon of the Holt-Krock Clinic in Fort Smith who performed the surgery on appellee, reported as follows:

“As stated in previous correspondence, I feel that we cannot, on any means, classify this boy with anything but a poor result from surgery.
“Once we get through the emotional and psychogenic overlay here, I think that we would be justified in suggesting a permanent partial disability of the body as a whole of 25% to 30%.
“I do not feel that this boy is going to be able to go back to an employment that he has enjoyed before such as manual exertions of lifting or bending over postures.
“I do believe that he is employable in such work as bench work, in which he might be re-trained in. If he was able to get back into an employable situation, regardless of its nature, I am sure that this would help reduce some of his anxiety and emotional overlay.”

On July 1, 1966, Dr. Stanley Applegate reported as follows:

“I have seen Mr. Christman this week and believe that he has 25% permanent disability due to his back trouble and have recommended that lie settle as soon as possible and get into Vocational Rehabilitation and learn a trade where he will not have to use his back so much as he was doing common labor at Wilson and Co.”

All that appellee had ever done, or knew how to do, required stooping, bending and lifting. There is evidence in the record that appellee suffered poor eyesight as an additional handicap to some types of employment. The importance of appellee’s educational background and experience in evaluating his disability in connection with his incapacity to earn because of his injury, is pointed up in Dr. Lockhart’s earlier report' of July 1, 1966, wherein he said:

"Several days ago, 6/20/66, he appeared in my office accompanied by his wife stating that he had total paralysis of the right lower extremity that had come on spontaneously.
" * * * It was obvious, when he was examined in the office, that we were dealing with either a hysterical paralysis or malingering.
"I feel that 1 have done as much as I can do with this man at the present time. They seemingly do not wish to accept the fact that this could be a hysterical problem and certainly his wife does not even like to consider the fact that there may be a question of malingering here also. It is obvious that we are not dealing with that degree of physical disease at the present time that would cause the magnitude of problems, or for that matter what physical disease is present is so far over-shadowed by these other factors that it is impossible to treat this man intelligently without thorough psychiatric evaluation and treatment.”

It goes without saying, and without the' necessity for citation of cases, that true malingering is not a form of disability of any sort. It is a form of ability rather than disability. It is a form of ability to feign injury or disability that does not exist. Had appellee in this case been malingering his disability, the Commission might well have determined that he had none. If appellee was suffering a true hysterical paralysis or reversionary reaction of a total degree and permanent nature as a result of the injury, the Commission might well have found that his permanent partial disability amounted to considerably more than the 60% awarded in this case.

In Larson’s Workmen’s Compensation Law, § 42.22, numerous cases from other jurisdictions are cited in support of the following statement:

. . [W]hen there has been a physical accident or trauma, and claimant’s disability is increased or prolonged by traumatic neurosis, conversion hysteria, or hysterical paralysis, it is now uniformly held that the full disability including the effects of the neurosis is compensible. Dozens of cases, involving almost every conceivable kind of neurotic, phy-chotic, depressive, or hysterical symptom or personality disorder have accepted this rule.”

The opinions of attending physicians and medical experts are admissible as competent evidence when properly presented in a compensation case, but such opinions are not conclusive. They are only to be considered by the Commission along with all other competent evidence, medical and otherwise, in arriving at the degree of permanent partial disability in a compensation case.

Appellant argues that there is no evidence to sustain the Commission’s award of 60% permanent partial disability. It is true that no one testified that claimant had a 60% permanent partial disability. Neither did any witness, including the appellee’s own testimony, fix his partial disability at 50% or 70,% but there is substantial evidence in the record that appellee has suffered a disability both in the loss of use. of his body as a whole, and in loss of capacity to earn in the same or any other employment, the same wages' he was receiving at the time of the injury. There is substantial evidence that this disability is permanent in nature and we are of the opinion that there is substantial competent evidence in the record to justify the Commission’s order and award based on a 60% permanent partial disability to the body as a whole.

Judgment affirmed.


source: Caselaw Access Project

author: J. Fred Jones, Justice. Conley Byrd, Justice,

license: Public Domain

text:
    William J. KIRBY, JUDGE, Circuit Court of Pulaski County, et al
    5328
    424 S. W. 2d 149
    Opinion delivered February 19, 1958

      G. Thomas Eisele, for petitioner.

      B. B. Adkisson, Prosecuting Attorney, for respondents.
   J. Fred Jones, Justice.

This cause is submitted here on certiorari from the Pulaski County Circuit Court, First Division.

The record before us is meager indeed, but the petitioner and the respondent agree in their briefs, that on December 5, 1967, the petitioner, Lynn A. Davis, while serving in the capacity of director of the Arkansas State Police, appeared before the Pulaski County grand jury, in response to a summons, and refused to answer a question propounded to him by, or on behalf of, the grand jury while it was in session.

The record does reveal that the foreman, the secretary, and the chairman of the Law Enforcement Committee of the grand jury, together with the prosecuting attorney, appeared with Davis before the trial judge in chambers, and upon inquiry as to the purpose of the appearance in chambers, the foreman of the grand jury stated:

“["W]e can’t get any place because of the Colonel here just refuses to give us any information whatsoever, and he makes a statement that he don’t intend to, and we feel like we have gone as far as we can go.”

The court then inquired as to the nature of the information sought by the grand jury, and the foreman of the grand jury continued,

“ [H]e says he has an informant but he is not willing to give us the informant or anything to go on at all. It’s all hearsay so far.”

The trial court inquired of the foreman of the grand jury whether the question propounded to Davis was in connection with the investigation the grand jury had under consideration at the present time, and the grand jury foreman answered in the affirmative. The prosecuting attorney stated to the court that it had been pointed out in the record that Davis had information to the effect that another person had personal knowledge and legal evidence presentable in court to the effect that a person —Kenneth Brown — was operating a gambling house, and that the only way the evidence could be obtained was through the disclosure of the person’s name which Davis refused to divulge. The prosecuting attorney then requested the court reporter to read the information from the notes taken before the grand jury, but this was not followed through.

At the close of these discussions in chambers, the pertinent parts of the record are as follows:

“THE COURT: Well now, as I understand it, and all of the Grand Jury has all agreed, and the Colonel here also agrees, that the question asked him, and that he refused to answer was: What was the name of his informant? And, now the Court wants to ask you. I have decided that it is material, and I think under Section 43-916 I can propound the same question to you, and of course, if you refuse to answer you will be in contempt of this Court, and be dealt with contempt. Now, what is the name of your informant ?
COL. DAVIS: I refuse to name the informant for fear of life or property.
* # *
THE COURT: * * * I am going, to have to hold you in contempt and send you to jail until you change your mind.”

Davis was then committed to the Pulaski County jail to he held until such time as he purged himself by answering the question propounded to him.

Grand juries have the “duty to inquire into all public offenses committed within the jurisdiction of the court in which they are impaneled, and to indict such persons as they find guilty thereof.” (Ark. Stat. Ann. § 43-908 Repl. 1964.) But, “the grand jury can receive none but legal evidence....” (Ark. Stat. Add § 43-918 [Repl. 1964].) (Emphasis supplied.) There is nothing in the récord before us that would reveal the nature of the investigation being conducted by the grand jury, or what information, if any, the grand jury desired, or hoped to obtain, from the individual whose identity Davis refused to reveal. The context in which the question was propounded to Mr. Davis is not in the record before us. The record does not reveal what the evidence of Davis’s informant would have been, and the record does, not reveal what, if anything, Davis had indicated it would be, if he did so indicate. Consequently, not knowing what Davis had testified that his unknown informant knew or could offer in the way of evidence, we have no way of determining whether it; would have been legal evidence which the grand jury could receive. In fact, the record here places us in the same position Davis’s testimony placed the grand jury as expressed by its foreman — it does not give us anything to go on at all.

Ark. Stat. Ann. § 43-916 (Repl. 1964) under which Davis was held in contempt and committed to jail, is as follows:

“When a witness, under examination, refuses to testify, or to answer a question put to him by the grand jury, the foreman shall proceed with the witness into the presence of the court, and there distinctly state the refusal of the witness, and if the court, upon hearing the witness shall decide that he is bound to testify or answer the questionypropound-ed, he shall inquire of the witness if he persists m his refusal, and if lie does, shall proceed with him as in cases of similar refusal in open court.” (Emphasis supplied.)

The statute does not set out to what extent the witness is to be heard before the court shall decide whether or not he is hound to testify or answer the question propounded, but surely the statute contemplates more than simply hearing the witness refuse again to answer the same question propounded to him in the grand jury room, without first ascertaining the nature of the information the question is designed to produce.

Our grand jury system is derived from the common law of England, and during the more than one-hundred years it has been in operation in Arkansas, this appears to be the first case before this court in which contempt proceeding's have been instituted against a police officer for failure to answer a question propounded by a grand jury. Indeed, we have found no cases indicating that a police officer has ever before refused to answer a question propounded to him by a grand jury.

As a usual procedure, the prosecuting attorney presents evidence to the grand jury based on information furnished him by investigating officers and the prosecuting attorney and police officers are usually on the sanie side in seeking indictments for criminal law violations and in presenting information or legal evidence to a grand jury for that purpose.

The petitioner, Davis, and the prosecuting attorney argue extreme views in opposite directions. The petitioner contends that as a police officer, he has an absolute privilege to refuse to reveal to a grand jury the source of any information he may have or obtain in connection with law violations. The prosecuting attorney contends that a police officer is bound to answer any and all questions propounded to him by a grand jury including the name of informers in all situations. We do not agree with either contention.

The privilege of a police officer in refusing to reveal the source of his information in criminal investigations (“informer privilege”) is recognized as .based on public policy under certain circumstances, the availability of which, depends upon the facts and circumstances of each particular case. Roviaro v. United States, 353 U. S. 53, 62 (1957); McCray v. Illinois, 386 U. S. 300 (1967); State v. Edwards, 317 S. W. 2d 441 (Mo. 1958); Application of Heller, 53 N. Y. S. 2d 86 (N. Y. 1945). Therefore, the privilege claimed by Davis in the case at bar is not an absolute privilege, but is qualified by the facts and circumstances of the particular case. In order, therefore, to determine whether Colonel Davis should have been required to answer the question, it is absolutely essential that we know something of the background, i. e., the nature of the inquiry which led up to this particular question. In other words, there are circumstances under which the question “What is the name of your informant?” should have been answered. To the contrary, under different facts and circumstances, the privilege could have been claimed.

The only background given this court is in the statement made in the judge’s chambers by the prosecuting attorney, in which he stated:

“Your Honor, it’s been pointed out in the record that this information which Col. Davis has is to the effect that a person has personal knowledge and legal evidence presentable in Court to the effect that a person under consideration by the Grand Jury at this time—
Kenneth Brown.
Was operating, a gambling house and Col. Davis has refused to divulge the name of the person who is possessed with this information, and it has been pointed out to Col. Davis that his statement regarding what the information that this person has is hearsay information and not presentable in Court, and the only way the evidence can be obtained is through the disclosure of a person’s name.” (Emphasis supplied.)

It will at once be seen that this statement contains several conclusions. The prosecutor states that the unidentified person has “legal evidence” and he twice uses the expression, “to the effect.” This, of course, is simply an interpretation of the alleged evidence by the prosecutor — and we are unable to tell from this record whether this interpretation was correct. We have no idea what Davis claimed the informant is supposed to have known. Did he go to Brown’s premises on an unrelated matter and observe gambling while there? Did he participate in gambling on Brown’s premises (which would make him an accomplice) or was he told by others that Brown was engaging in this illegal enterprise, and he then passed this information on to Davis? Was it Davis’s own testimony or the information Davis testified that the informant had, that the prosecuting attorney considered ‘'hearsay information”? These are examples of questions that have a direct bearing on the issue of whether the privilege could be rightfully claimed.

A statement could have been placed in the record by the foreman of the grand jury or the prosecuting attorney, with the assent of Davis (a stipulation), indicating the nature of the investigation that led to this particular question, or the foreman of the grand jury could have testified as to the facts which prompted the question propounded to Mr. Davis. He might have testified that Davis had stated that his informant saiu gambling in progress-, or he might have testified that Davis claimed that his informant heard that gambling was going on. In any event, the implications of the question “What is the name of your informant?” would be discernible in the setting the question was asked, and we would have some basis for determining whether the question would constitute or produce legal evidence which the grand jury could receive and which Davis was bound to give.

It may well be that tbe circuit judge bad other information not in the record before us, in making his determination that the question was material. This is somewhat indicated by the prosecuting attorney’s opening statement, “Your Honor, it’s been pointed out in the recordSubsequently, the prosecutor said to the court reporter, “Would you read the information.” [Apparently referring to the alleged information held by the informant.] The reporter replied. “It will take some time to read back in my notes.” And this was as far as the matter went. At any rate, no record is before us.

Even if the record was such that we could conclude that the question should have been answered, the answer should have been given in the secret confines of the grand jury room and, not in the judge’s chambers or in open court. Answers given to questions propounded by a grand jury are not public records and their secrecy is protected by statute. (Ark. Stat. Ann. § 43-928 [Repl. 1964]).

The statute § 43-916, supra, provides that upon hearing the witness, if the court should decide that he is bound to answer the question propounded by the grand jury, that the court ‘ ‘ shall inquire of the witness if he persists in his refusal.” That is as far as the statute goes pertaining to the question and answer, and that is as far as the court should go pertaining to the question and answer. The statute does not direct the court to propound the same question in semipublic court chambers or in completely public open court, calling for the same answer the grand jury sought, and which the witness refused to answer in the secret confines of the grand jury room, and the reason for this is obvious. The statute does not set out what the court shall do if the witness does not persist in his refusal, but certainly in that event, the witness should be returned to the grand jury room where the question is to be answered and the jury’s investigation continued.

From the record 'before us we are unable to say that Davis was guilty of criminal contempt in refusing to answer the question propounded to him, so the summary order of the trial court holding Davis in contempt is hereby set aside.

Byrd, J., dissents.

Conley Byrd, Justice,

dissenting. Involved here is the issue of whether a policeman can invoke before the grand jury the so-called informer’s privilege as to the identity of an informant. In addition, the majority opinion questions the sufficiency of the record and the procedure used by the trial court in determining whether the witness persisted in refusing to answer the question; and lastly holds that a grand jury cannot pursue a chain of witnesses to acquire legal testimony about a law violation or an exoneration of an alleged offense.

I

Before today’s decision there was no Arkansas statute or case law recognizing the so-called informer’s privilege. My research discloses only two cases, In re Kolm, 227 La. 245, 79 So. 2d 81 (1955), and People v. Keating, 286 App. Div. 150, 141 N. Y. S. 2d 562 (1955), where the invoking of the privilege before a grand jury has been attempted. The issue ordinarily arises during the trial of the accused — see Annot., 76 A. L. R. 2d 262 (1961).

Some jurisdictions follow the common law, as in Boviaro v. United States, 353 U. S. 53 (1957), where, the privilege and its limits are stated as follows:

“What is usually referred to as the informer’s privilege is in reality the Government’s privilege to withhold from disclosure the identity of persons who furnish information of violations of law to officers charged with enforcement of that law. Scher v. United Slates, 305 US 251, 254 83 L ed 151, 154, 59 S Ct 174; Re Quarles, 158 US 532, 39 L ed 1080, 15 S Ct 959 ; Vogel v. Cruaz, 110 US 311, 316, 28 L ed 158, 160, 4 S Ct 12. The purpose of the privilege is the furtherance and protection of the public interest in effective law enforcement. The privilege recognizes the obligation of citizens to communicate their knowledge of the commission of crimes to law-enforcement officials and, by preserving their anonymity, encourages them to perform that obligation.
“The scope of the privilege is limited by its underlying purpose. Thus, where the disclosure of the contents of a communication will not tend to reveal the identity of an informer, the contents are not privileged. Likewise, once the identity of the informer has been disclosed to those who would have cause to resent the communication, the privilege is no longer applicable.
“A further limitation on the applicability of the privilege arises from the fundamental requirements of fairness. Where the disclosure of an informer’s identity, or of the contents of his communication, is relevant and helpful to the defense of an accused, or is essential to a fair determination of a cause, the privilege must give way. In these situations the trial court may require disclosure and, if Ihe Government withholds the information, dismiss the action. Most of the federal cases involving this limitation on the scope of the informer’s privilege have arisen where the legality of a search without a warrant is in issue and the communications of an informer are claimed to establish probable cause. In these cases the Government has been required to disclose the identity of the informant unless there was sufficient evidence apart from his confidential communication.
“We'believe that no fixed rule with, respect to disclosure is justifiable. The problem is one that calls for balancing the public interest in protecting the flow of information against the individual’s right to prepare his defense. Whether a proper balance renders nondisclosure erroneous must depend on the particular circumstances of each case, taking into consideration the crime charged, the possible defenses, the possible significance of the informer’s testimony, and other relevant factors.”

Other, jurisdictions have adopted by statute American Law Institute Model Code of Evidence Rule 230, which provides:

“A witness has a privilege to refuse to disclose the identity of a person who has furnished information purporting to disclose a violation of a provision of the laws of this State or of the United States to a representative of the State or the United States or a governmental division thereof, charged with the duty of enforcing that provision, and evidence thereof is inadmissible, unless the judge finds that (a) the identity of the person furnishing the information has already been otherwise disclosed or (b) disclosure of his identity is essential to assure a fair determination of the issues.”

In 76 A. L. R. 2d 275 (1961) the theory of the privilege is stated as follows:

“The privilege is founded upon public policy, and seeks to further and protect the public interest in effective law enforcement. It recognizes the obligation of citizens to communicate their knowledge of the commission of crimes to law enforcement officers, and by preserving their anonymity, encourages them to perform that obligation. The privilege is designed to protect the public interest, and not to protect the informer.” (Emphasis supplied.)

Thus it is seen that the theory and purpose behind the privilege are not complicated matters but in fact are within the comprehension of the average citizen. Furthermore, since the privilege is not for the protection of the informer, but for the protection of the public interest, it logically follows that some public official or public body must have the discretion to determine when it is or is not in the public interest to invoke the privilege. In fact, practical law enforcement demands that such discretion be deposited with some public official or body, for obviously the law enforcement policies of our cities would be hamstrung if a police chief had to go before the courts and make the showing required by the majority opinion here before he could obtain the name of an informant known only by his subordinates who had different views as to the public interest.

If, as demonstrated above, the informer’s privilege is not applicable as between a rookie policeman and a city police chief, or as between a state patrolman and the state police director, then why is not the same logic applied to a policeman and the grand jury? In arriving at this logic I accede to Lincoln’s theory that our government is “of the people, by the people and for the people.”

Our grand juries are directed by law, Ark. Stat. Ann. § 39-206 (Repl. 1962), to consist of sixteen persons of good character, approved integrity, sound judgment and reasonable information. By Ark. Stat. Ann. § 43-908 (Repl. 1964) the grand jury has the power and the duty “. . . to inquire into all public offenses committed within the jurisdiction of the court in which they- are impaneled, and to indict such persons as they find guilty thereof.” Ark. Stat. Ann. § 43-907 (Repl. Í964) specifically directs it to inquire “into the wilful and corrupt misconduct in officers of every description in the county. ” The right to subpoena witnesses is given by Ark. Stat. Ann. § 43-912 (Repl. 1962). Thus it is obvious that the grand jury is an arm of the court, comprising a body selected from the people and recognized by statute as having a standing, from the administration of justice viewpoint, superior to that of the policeman. This is emphasized by virtue of the subpoena power and the mandatory direction to inquire into the wilful and corrupt misconduct of officers of every description.

The fact that only two cases have been found where an attempt was made to invoke the informer’s privilege before a grand jury demonstrates that grand juries are capable of understanding the nature of the privilege and of determining what is in the public interest. The Pulaski County grand juries are no exceptions. The lists of those selected to serve are usually published in the state’s leading newspapers — among those selected are farmers, bank directors, labor leaders, contractors, advertising executives and advisors to governors. These people are as capable as any public official in determining what is in the “public interest.”

Therefore it is my opinion that as between a policeman and a grand jury, the policeman should not be entitled to invoke the informer’s privilage. Of course this does not mean that the policeman is not entitled to state his position to the grand jury and the court before identifying his informer.

II

The record made before the trial court is not long. Since I disagree with the majority as to its sufficiency, I am attaching it hereto as an appendix.

III

Tlie procedure followed by the court here is identical with that approved in Ex parte Butt, 78 Ark. 262, 93 S. W. 992 (1906). The majority opinion suggests that the trial court erred in asking petitioner to give it the name of the informant — i. e. the trial court should have instructed petitioner to return to the grand jury room and answer the question. In this, the majority opinion does violence to the statute, Ark. Stat. Ann. § 43-916 (Rep. 1964), which provides:

“When a witness, under examination, refuses to testify, or to answer a question put to him by the grand jury, the foreman shall proceed with the witness into the presence of the court, and there distinctly state the refusal of the witness, and if the court upon hearing the witness shall decide that he is bound to testify or answer the question propounded, he shall inquire of the witness if he persists in his refusal, and if he does, shall proceed with him as in cases of similar refusal in open court.”

The statute requires the trial court to determine only (1) whether the witness is bound to answer the question, and (2) if he persists in his refusal. The summary procedure used by the trial court was also affirmed in Lockett v. tate, 145 Ark. 415, 224 . W. 952 (1920). ee also Uphaus v. Wyman 360 U. . 72 (1959).

IV

By innuendo it is suggested that the record is insufficient because the grand jury could receive only “legal evidence” and that the informant’s name would not necessarily be “legal evidence” within the meaning of Ark. Stat. Ann. § 43-918 (Repl. 1964). The statute provides:

“The grand jury can receive none but legal evidence ; they are not bound to hear evidence for the defendant, but it is their duty to weigh all the evidence before them, and if they believe that other evidence within their reach will explain away the charge, they should order the evidence to be produced. ’ ’

I disagree with the suggestion (1) because it lifts the phrase “legal evidence” out of its context; (2) because it ignores the fact that a grand jury is ordinarily composed of laymen; and (3) because it presupposes that if the name of the informant were irrelevant or immaterial, the grand jury could not make any inquiry about it.

With respect to the relevancy of testimony, in Ex parte Butt, supra, we held:

“Petitioner, 'Butt, contends that a witness cannot be punished for contempt for refusal to answer irrelevant questions. If a witness is interrogated before a court or officer about a matter entirely outside of its jurisdiction, he may refuse to testify. This, of course, does not authorize him to refuse to answer questions propounded in a legitimate cross-examination. But, if the court or officer has jurisdiction of the subject-matter involved, a witness should not be permitted to refuse to answer a question on the ground that it is irrelevant. To permit him to do- so against the opinion of the court or officer taking his testimony would ‘be subversive of all order in judicial proceedings. The fact that such questions are irrelevant or improper’ furnishes no reason for impeaching the commitment of the witness for refusing to answer them. Ex parte McKee, 18 Mo. 600; People v. Cassels, 5 Hill (N. Y.), 165; Bradley v. Veazie, 47 Mo. 85; Rapalje on Contempt, § 66, and cases cited.”

Under the majority’s suggestion, a grand jury can no longer inquire of any witness as to who told him that gambling was going on at the place of business of the person under investigation, unless the witness can also say that his informant, saw the gambling going on. I do not think the statutes should be so constrictively interpreted.

It therefore appears to me, for the reasons stated, that the name of petitioner’s informant was a matter into which the grand, jury was entitled to inquire, and that he persisted in his refusal after the trial court found that he was bound to answer the question.

I would deny the petition for certiorari.

PROCEEDINGS HEARD BEFORE HON. WILLIAM J. KIRBY IN HIS CHAMBERS, FOURTH FLOOR PULASKI COUNTY COURTHOUSE, LITTLE ROCK, ARKANSAS, ON THE FIFTH DAY OF DECEMBER, 1967, AT THE HOUR OF APPROXIMATELY 1:30 P.M.:

THE COURT: First, let’s let the record show what this is all about. Let the record show that the Pulaski County, Foreman of the Grand Jury, Mr. Burroughs, and the Grand Jury Secretary, Mr. Wimberly, and Chairman of the Law Enforcement Committee, Mr. Larry Robinson, along with the Prosecuting Attorney and Chief Davis appeared before me at — I’ll do it right, 1:30.
Now, Mr. Prosecutor, you may state, or Mr. Foreman, you may state what the purpose of this is for.
MR. BURROUGH: Well, Judge, Your Honor, we can’t get any place because of the Colonel here just refuses to give us any information whatsoever, and he makes a statement that he don’t intend to, and we feel like we have gone as far as we can go.
THE COURT: Well, now, what is the nature of the information! What do you want to know! I will have to know so 1 can ask him, to see whether T think it should be asked.
MR. BURROUGHS: Well, he says he has an informant but he is not willing to give us the informant or anything to go on at all. It’s all hearsay so far.
EXHIBIT ‘A’
THE COURT: Well now, is this in connection with the investigation you have got under way at the jn'esent time?
MR. BURROUGHS: Yes.
MR. ADKISSON: Your Honor, it’s been pointed out in the record that this information which Col. Davis has is to the effect that a person has personal knowledge and legal evidence presentable in Court to the effect that a person under consideration by the Grand Jury at this time—
THE COURT: What’s his name?
MR. ADKISSON: Kenneth Brown.
THE COURT: All right.
MR. ADKISSON: Was operating a gambling house and Col. Davis has refused to divulge the name of the person who is possessed with this information, and it has been pointed out to Col. Davis that his statement regarding what the information that this person has is hearsay information and not presentable in Court, and the only way the evidence can be obtained is through the disclosure of a person’s name.
THE COURT: Well, of course, the Grand Jury is not supposed to consider anything confidential evidence. You’ve read the Statute here, 43-916, haven’t you?
COL. DAYIS: I’m not sure, Your Honor.
THE COURT: "Well, you can have the book there and read it or you can do it.
COL. DAVIS : "Which one ?
THE COURT: 4-3-916. Right down at the bottom there.
COL. DAVIS: Yes, sir.
THE COURT: Now, why don’t you think that applies to you?
COL, DAVIS: Supreme Court decisions have been made that the police officer and his informant enjoys somewhat the same rights as clergy and people—
THE COURT: The high Supreme Court has decided that?
COL. DAVIS:- The U. S. Supreme Court.
THE COURT: Well, I’m not bound by their rules in this particular instance here. This is a hearing before the Grand Jury. Now, has our Supreme Court, to your knowledge ?
COL. DAVIS: I don’t know.
THE COURT: If they have, well, you have some law that I don’t know.
COL. DAVIS: I don’t know, but I was advised by legal counsel that I did not have to.
THE COURT: I can’t make you disclose it all.
MR. ADKISSON: Would yon read the inform a - tion?
REPORTER: It will take some time to read back in my notes.
MR. ADKISSON: Well, it was right at the first.
THE COURT: Well now, as I understand it, and all of the Grand Jury has all agreed, and the Colonel here also agrees, that the question asked him, and that he refused to answer was? What was the name of his informant. And, now the Court wants to ask you. I have decided that it is material, and I think under Section 43-916 I can propound the same question to you, and of course, if you refuse to answer you will be in contempt of this Court, and be dealt with contempt.
Now, what is the name of your informant?
COL. DAVIS: I refuse to name the informant for fear of life or property.
THE COURT: Well, I saw something' in the paper the other day where you weren’t particularly concerned, that you did not feel or think that these boys would hurt him.
COL. DAVIS: Well, of course, I said life and or property.
THE COURT: I don’t know whether you can believe everything you read in the paper, but that is not much of a reason. Call my bailiff in here. I am going to have to hold you in contempt and send you to jail until you change your mind.

       The majority opinion recognizes that the applicability of the privilege is not left to the officer. 8 Wigmore, Evidence (McNaughton rev. 1961) § 2379 (g) points out that the lawful limits of the privilege are extensible beyond any control if its applicability is left to the determination of the very official whose interest it may be to shield a wrongdoing _ under the privilege.

       During oral argument petitioner conceded that the privilege was not applicable as between a rookie policeman and a city police chief.


author: Conley Byrd, Justice. George Rose Smith, Justice,

text:
    Robert C. STROUD v. PULASKI COUNTY SPECIAL SCHOOL DISTRICT et al
    5-4442
    424 S. W. 2d 141
    Opinion delivered February 19, 1968

      Warren & Bullion, for appellant.

      Leon Catlett, Roy Finch and Jim Moore, for ap-pellees.
   Conley Byrd, Justice.

Appellant Robert C. Stroud, in his capacity as a taxpayer, appeals from a decree holding valid a contract between Holiday Manufacturing Company and the Pulaski County Special School District. Appellant instituted his action pursuant to Ark. Stat. Ann. § 80-136, -137 and -1909 (Repl. 1960) against the School District; E. F. Dunn, Superintendent; and Winston G-. Chandler individually and as a member of the School District, to enjoin only the payment of the transportation costs — the validity of the balance of the contract is not challenged. The complaint alleges that the School District entered into a contract with "Winston Gr. Chandler, a hoard member, through a corporation owned by Chandler and his family known as Chandler Trailer Convoy, Inc., to move certain relocatable school buildings from Holiday’s plant in Camden to the sites desired by the School District. Holiday Manufacturing Company, a division of Holiday Inns of America, Inc., and Chandler Trailer Convoy, Inc., intervened.

The School District had entered into their separate contracts for delivery, P. O. B. school’s address, of a total of 25 such buildings. The price per building in each contract is the same and the other charges are in proportion thereto. A portion of the July 28, 1966 contract showing the way Holiday arrived at its contracted amount is as follows:

“That the Seller, in consideration of the covenants, on the part of the Buyer, hereinafter contained, hereby agrees with the Buyer, that the Seller will deliver to the Buyer at the Buyer’s address,.above listed, the following described equipment, for the following sum of money:
1. Twenty (20) Portable, Relocatable Buildings, 26 ft. x 56 ft., f.o.b. factory, at $13,643.00 per building $272,860.00
2. Twenty (20) Partition Walls, full width and height, at $298.30 ea. 5,966.00
3. Twenty (20) Hollow Core doors, 1 3/8 in. x 2 ft. 8 in. x 6 ft. 8 in., complete with door jambs, stops, hinges, and hardware, installed and painted, at $30.45 ea. 609.00
4. Welsch California Ash Hardwood Paneling, installed, at $152.00 per building, Total of $2,736.0 Sub-Total No■ Charge $279,435.00
5.Sales Tax (Arkansas) at 3% 8,303.05
6.Transportation. — 40 units (20 buildings) including permits at $86.00 per unit 3,440.00
7.Service Charge — 40 undercarriages for 95 miles average, at $.10 per mile per unit 380.00
Total $291,638.05

of good merchantable quality and in accordance with specifications and the letter furnished to Pulaski County Public Schools, Pulaski County, Little Rock, Arkansas.”

It was shown that, of the $86 transportation charge per unit, Holiday calculated $8 as overhead consumed by it in connection with the transportation of the buildings*Another $8 was paid to the state: $5 for the special permit required to transport each unit and $3 for a transit tag. 'The remaining $70 was paid to the common carrier for transporting one unit of the building frota Camden to the school site. Each building consisted of two units.

The record further shows that Winston Gr. Chandler is president of Chandler Trailer Convoy, Inc., of which he owns 14 per cent of the stock; that his wife owns 50 per cent of the stock; and that the balance is owned by other family members. Chandler Trailer Convoy, Inc. is a common carrier of transport and holds a Certificate of Convenience and Necessity under the regulations of the State Commerce Commission. Only two other entities are authorized by the State Commerce Commission to engage in similar intrastate transportation of portable buildings. They are Arkansas Transit Homes and Morgan Driveaway, Inc. Arkansas Transit Homes is owned by Chandler’s brother. Chandler owns no interest in Arkansas Transit Homes, nor does the brother own an interest in Chandler Trailer Convoy, Inc. Morgan Driveaway, Inc., has its home offices in Elkhart, Indiana. Its closest terminal is St. Lonis.

The tariffs filed with the State Commerce Commission by Chandler Trailer Convoy and Arkansas' Transit Homes authorize the transportation of the Holiday units from Camden to the school site for $70 per unit. The filed tariff rate for Morgan Driveaway, Inc., is $104 for the same transportation. Our laws, Ark. Stat. Ann. § 73-1770 (Repl. 1957), provide that no greater or less or different compensation for transportation or for any service in connection therewith between the points enumerated in such tariff shall be charged, demanded or collected. The record shows that after Chandler Trailer Convoy hauled 34 of the units the rest were hauled by Arkansas Transit Homes. It is silent about any contract between Chandler Trailer Convoy and Holiday Manufacturing Company when the contracts were entered into between the School District and Holiday. So far as the record shows, the dealings between Chanter Trailer Convoy and Holiday were on an “as needed’’ basis.

Ark. Stat. Ann. § 80-136, -137 and -1909 make it unlawful for any school board member to be interested directly or indirectly in the sale of any commodities sold to and purchased by the member’s district. Thus, in determining whether the contract was void or voidable we look at the contract at the time it was executed. Unless Chandler was to receive a benefit either directly or in7 directly when the contract was executed between the School District and Holiday, then Holiday’s contract would be valid. The only proof on this issue is that the itemized transportation charge coincides with Chandler’s tariff. But here again, the transportation charge also coincides with the tariff filed by Arkansas Transit Homes. Since t'he law will not presume that the parties to a contract intended an illegal act, 17 Am. Jur. 2d, Contracts, § 238, we are unwilling to say that this meager evidence is sufficient to show that Chandler had an interest either directly or indirectly in the contract between Holiday and the School District at the time the contract was executed.

The record indicates that the contract between Holiday and the School District was upon competitive bid. Defendant’s Exhibit 7 is entitled “Bid 'Sheet” and has attached thereto specifications for portable buildings for the Pulaski County Special School District. In this instance bids were taken and apparently the bids were let to the lowest bidder meeting the specifications required by the School District. At any rate, Superintendent Dunn testified that the specifications for the bids were drawn so that they would not eliminate any bidder. Of course, if the contract was let on competitive bids, then appellant’s argument is without merit, because Ark. Stat. Ann. § 80-1909, supra, specifically recognizes that a board member may deal with the school district as to material upon competitive bids.

Affirmed.

George Rose Smith,¡ J., dissents.

George Rose Smith, Justice,

dissenting. The majority opinion overlooks a basic principle in the law of trusts — the rule that a fiduciary, regardless of his good faith, is absolutely forbidden to take a position in which his personal interest is in conflict with his duty as a trustee.

A public officer occupies the status of a trustee with respect to the governmental body (here the school district) that he represents and with respect to its property. Fidelity & Deposit Co. of Md. v. Cowan, 184 Ark. 75, 41 S. W. 2d 748 (1931); Grooms v. Bartlett, 123 Ark. 255, 185 S. W. 282 (1916); State v. Baxter, 50 Ark. 447, 8 S. W. 188 (1887). As a trustee he must conform to the high ethical standard imposed by the law upon all fiduciaries. In Cardozo’s familiar words: “A trustee is held to something stricter than the morals of the market place. Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior.” Meinhard v. Salmon, 249 N. Y. 458, 164 N.E. 545, 62 A. L. R. 1 (1928).

A trustee cannot engage in any activity in which his own financial interest conflicts with that of the trust. For example, an administrator cannot buy at his own sale, simply because his own pecuniary interest demands that he get the property as cheaply as possible while his fiduciary duty demands that he obtain the highest possible price. Good faith and what might appear to be the best interest of .the trust have nothing to do with the matter.

In the case at bar I do not impugn Chandler’s motives, because, conceding his integrity and high principles, the disqualification is absolute. “No one can be allowed to assume a position in which his interests are antagonistic to his duties, and derive a personal benefit from it. However firm the virtue of individuals may be, human nature as a general rule cannot endure the test, and equity, for security, removes the temptation by the inflexible rule that all profits of the trustee . . . must enure to the benefit of the cestuis que trustent.” Trimble v. James, 40 Ark. 393 (1883).

Apart from statute, Chandler’s position in this case involves that same conflict of interest which, without exception, is prohibited by the law of trusts. On the one hand his duty as a school director required him to purchase the needed school buildings or other property at the lowest possible price. The district is entitled to demand that its directors be absolutely free from any personal interest in such purchases. Here the testimony makes it plain that all the district’s contracts are not let to the lowest bidder, but even if they were we all know that one prospective seller can be favored over his competitors by the wording of the specifications.

On the other hand, if Chandler can participate to his profit in the performance of the contract, as he is doing in this case, his personal interest clashes directly with his duty to the school district. Suppose, for example, that there are two rivals competing- for the district’s business. One fabricates his buildings or other products locally, while the other must rely upon the type of transportation facilities furnished only by Chandler or his brotliei. How can Chandler, in choosing between the two, discharge his duty to the district with the perfect impartiality that the law demands ? He cannot.

It is no answer to say, as the majority do, that unless there was prearrangement between Chandler and Holiday when the contract was executed between Holiday and the district, then Holiday’s contract is valid. That attitude accomplishes nothing except to outlaw actual dishonesty if it is detected. In Cardozo’s phrase, it condones conduct meeting the morals of the market place, but it fails to hold public officers to their fiduciary duty. Moreover, nothing is in issue here except Holiday’s subcontract with Chandler. If that contract were declared to be invalid, as against public policy, the district would be fully protected both in this instance and in similar situations that will certainly arise now that the majority have opened the door to constructive fraud.

Finally, the statutes adopt the controlling principle so explicitly that I do not understand how the majority can conclude that Chandler’s subcontract is not in direct violation of the law. Section 80-138 reads in pertinent part as follows: “It shall be unlawful for any person serving as a member of any . . . local school board to be or become interested directly or indirectly in the profits or purchase price received by any person, firm or corporation from the sale of any . . . materials of whatsoever kind or character sold to any school board of which such person may be a member.” (My italics.) The wording of the statute fits the District-Holiday-Chandler transaction like a rubber glove. If the legislature has not prohibited deals such as the one now before us, the- English language is incapable of achieving that result. I would reverse the decree and declare the Chandler subcontract to be void.


author: CarletoN Habéis, Chief Justice. JohN A. Fogleman, Justice,

text:
    Weldon DOUGLAS et al v. THE CITIZENS BANK OF JONESBORO
    5-4401
    424 S. W. 2d 532
    Opinion delivered February 26, 1968

      Ward & Mooney, for appellants.

      Douglas Bradley, for appellee.
   CarletoN Habéis, Chief Justice.

This litigation involves two separate causes of action, which however, by agreement, were set forth in one set of pleadings, and disposed of at one hearing. Appellants, Weldon Douglas, and Janie Chandler, each maintained a checking account in the Citizens Bank of Jonesboro. Rees Plumbing Company, Inc. (which is not presently á party to this proceeding), was a customer of the hank, and maintained checking accounts. On August 19, 1966, the plumbing company delivered its check in the amount of $1,000.00 to Douglas. On that same day Douglas presented the check to the bank for deposit to his own checking account; an employee at the teller’s window prepared a deposit slip, dated as of that day, reflecting that the check was being deposited to Douglas’ account. He was given a duplicate of the deposit slip, and an employee of the bank thereafter affixed to the back of the check a stamp in red ink, denoting the August 19th date, and stating, “Pay to any bank — P.E.G., Citizens Bank of Jonesboro, Jonesboro, Arkansas.” Under date of August 20, 1966, the bank dishonored the check because of insufficient funds, and charged the amount back to the account of Douglas. This same statement of facts applies to Mrs. Chandler, except that the check she presented was originally made payable to a Richard R. Washburn (in the amount of $1,600.00) by the same Rees Company, and this check had been properly endorsed by Washburn before coming into the hands of Mrs. Chandler.

Rees Plumbing Company filed an unverified complaint against the bank, alleging that it had issued the aforementioned checks to the parties, and that it had sufficient funds in the accounts to honor these checks. It was alleged that the checks were wrongfully dishonored, and Rees sought damages due to the alleged willful and wanton negligence of the bank in handling its checks. Subsequently, the complaint was amended to join appellants as parties plaintiff (together with another party which later took a non-suit). Thereafter, on motion of appellee, Rees Plumbing Company was stricken as a parity plaintiff. After first demurring, and moving to make the complaint more definite and certain, the bank filed an answer setting out that the accounts of Rees were insufficient on August 19 to honor the checks, and further, that both were charged back to the- accounts of the respective appellants on August 20, and the appellants so notified. The bank further denied that the endorsement stamp, heretofore mentioned, constituted an acceptance stamp. The bank asserted that the stamp was no more than a method of identification. Both appellants and the bank, appellee herein, filed verified motions for summary judgment. Appellants’ motion was supported by the checks and the deposit slips, which had already been filed, and appellee’s motion was supported by the affidavit of Major Griffin, Vice-President of the Citizens Bank, filed with the motion for summary judgment. The affidavit reflects that Griffin had been engaged in banking with the Citizens Bank for 20 years, and it asserted that he was familiar with the processing of items in the Citizens Bank, as well as the normal procedures of other banks, and particularly familiar with the stamps and symbols used by banks in the area. He then explained the procedure used by appellee, and stated that the stamp served only to identify the depository bank, and that the endorsement appeared on all checks received by appellee which are not received from other banking institutions. He then stated:

“Any item for any reason can be returned by the Citizens Bank or any other banking institution (except those cashed over the counter) if rejected before midnight of the next banking day following the banking day on which the item is received, and prior to the bank stamping its ‘paid’ stamp thereon and filing in the customer’s file.
“I have examined the Citizens Bank records with reference to a $1,600.00 check drawn on Rees Plumbing Company, Inc. account number 810 657 payable to Richard R. "Washburn and find that it was deposited to the account of Mrs. Janie Chandler, a customer of the Citizens Bank in account number 301191 on August 19,1966. This deposit was posted to the Citizens Bank Journal to the Or edit of Mrs. Janie Chandler’s account on August 19, 1966, but the check was not posted to Citizens Bank Journal as a charge to the Bees Plumbing Company account on which it was drawn because there was no balance in the Rees Plumbing Company Account at close of business on the date of August 19, 1966. The account of Mrs. Janie Chandler was debited for the insufficiency under date of August 20, 1966, and was returned to Mrs. Chandler. ’ ’

He stated that the same procedure was followed with the Douglas check. The court denied the motion of the appellants, but granted.that of the bank.

Thereafter, appellants petitioned the court to reopen the case for the purpose of receiving additional evidence on the question of what weight, if any, might be given to a statement printed on the backs of the deposit slips which had been introduced into evidence by agreement. The language oil the back of the deposit slips provides, inter alia, that “items drawn on this bank not good at close of business day on which they have been deposited may be charged back to depositor.” Appellants desired to introduce evidence to show that they did not know of the language on the back of the slips. The court refused to reopen the case, but the trial judge did state that, in reaching his conclusions, he gave no consideration at all to this language; nor do we consider same in the present instance, it being immaterial to the disposition of the litigation. Prom the judgment denying the motion to reopen the case; denying the motion for summary judgment filed on behalf of appellants, and granting the motion for summary judgment on behalf of appellee, comes this appeal.

The principal., question at issue is, “Did the bank, by stamping the endorsement upon the checks deposited by appellants, and by delivering to appellants the deposit slips, accept both of said checks for payment?” The answer is, “No,” and it might be stated at the outset that cases decided prior to the passage of the Uniform Commercial Code are not controlling. This case is controlled by the following sections of the Code: Ark. Stat. Ann. § 85-4-212 (3), § 85-4-213, and § 85-4-301 (1) (Add. 1961).

Subsection (3) of Section 85-4-212 reads as follows:

“A depositary bank which is also the payor may charge back the amount of an item to its customer’s account or obtain refund in accordance with the section governing return of an item received by a payor bank for credit on its books (Section 4-301 [ § 85-4-301]).”

Subsection (1) of Section 85-4301 provides:

“Where an authorized" settlement for a demand item (other than a documentary draft) received by a payor bank otherwise than for immediate payment over the counter has been made before midnight of the banking day of receipt the payor bank may revoke the settlement and recover any payment if before it has made final payment (subsection (1) of Section 4-213 [§ 85-4-213]) and before its midnight deadline it

(a) returns the item; or

(b) sends written notice of dishonor or nonpayment if the item is held for protest or is otherwise unavailable for return.”

Section 85-4-213 simply sets out the time that a payment becomes final, not applicable in this instance.

When we consider the statutes above referred to, it is clear that appellants cannot previa!. Clark, Bailey and Young, in their American Law Institute pamphlet on hank deposits and collections under the Uniform Commercial Code (January, 1959), p. 2, comment as follows :

“If the buyer-drawer and the seller-payee have their accounts in the same bank, and if the seller-payee deposits the check to- the credit of his account, his account- will be credited provisionally with the amount of the check. In the absence of special árrangement with the bank, he may not draw against this credit until it becomes final, that is to say, until after the check has reached the bank’s bookkeeper and, as a result of bookkeeping operations, has been charged to the account of the buyer-drawer. (The seller-payee could, of course, present the check at a teller’s window and request immediate payment in cash, but that course is not usually followed.) If the buyer-drawer’s account does not have a sufficient balance, or he has stopped payment on the cheek, or if for any other reason the bank does not pay the check, the provisional credit given in the account of the seller-payee is reversed. If the seller-payee had been permitted to draw against that provisional credit, the bank would recoup, the amount of the drawing by debit to his account or by other means.”

The comment of the commissioners is also enlightening. Comment 4, under Section 85-4-213, states:

“A primary example of a statutory right on the part of the payor bank to revoke- a settlement is the right to revoke conferred by Section 4-301. The underlying theory and reason for deferred posting statutes (Section 4-301) is to require a settlement on the date of receipt of an item but to keep that settlement provisional with the right to revoke prior to the midnight deadline. In any case where Section 4-301 is applicable, any settlement by the payor bank is provisional solely by virtue of the statute, subsection (1) (b) of Section 4-213 does not operate and such provisional settlement does not constitute final payment of the item.”

Appellants assert that the affidavit of Major Griffin was never introduced into evidence, and cannot'be considered as anything more than any other pleading in the case. We do not agree. We know of no requirement that an affidavit be “introduced;” the affidavits are simply filed, and this particular one was filed with the motion for summary judgment. Epps v. Remmel, 237 Ark. 391, 373 S. W. 2d 141.

No counter-affidavits were filed by appellants. They were content to rely on the checks and deposit slips offered as exhibits, and counsel for appellant stated, “I want the motion for summary judgment on behalf of defendant to be considered as contradicted. Did not file a formal affidavit, offered proof.” This, of course, constituted no more than the legal question here-presented for determination, i. e., “Did the bank by stamping the endorsement upon the checks deposited by appellants, and by delivering to appellants the deposit slips, accept both of said checks for payment?” It is not necessary to discuss whether counsel’s simple statement can be considered as controverting’ the Griffin affidavit, since the court permitted it, and it is not decisive in determining the issue herein presented. There was no request by counsel for time to present an affidavit, or to take the deposition of Rees, or anyone else. The Rees complaint (unverified) alleged that sufficient funds were on hand to pay the checks, and the checks were wrongfully dishonored. Nonetheless, no affidavit was made to support this conclusion, nor was one made that sufficient funds had been deposited on the 19th to enable the checks to he paid. In Epps v. Remmel, supra, we said:

“* * * To take a simple example, if in an action on a promissory note, the defendant in his answer denies the making of the note; the plaintiff makes a motion for a sumimary judgment, accompanying it by an affidavit of a person who swears that he saw the defendant sign the note; and the defendant does not file an opposing affidavit, summary judgment should be rendered for the plaintiff. ’'

There is absolutely nothing in the record to contradict Major Griffin’s sworn statement that he examined the records at the close of business on August 19, and there was no balance in the Rees Plumbing Company accounts.

Affirmed.

FOGLEMAN, J., concurs.

JohN A. Fogleman, Justice,

concurring. I concur in the result reached. I consider the fact statements in the affidavit of Major Griffin with reference to the sufficiency of funds in the Rees accounts to have been inadmissible in evidence, not having' been within his personal knowledge and having been obtained only by an examination of records. Oliver v. Eureka Springs Sales Company, 222 Ark. 94, 257 S. W. 2d 367; Mevorah v. Goodman, 79 N. D. 443, 57 N. W. 2d 600. A movant for summary judgment must sustain his burden to clearly show that there is no genuine issue of fact by matters of which the court will take judicial notice or by evi-dentiary matters which the court is entitled to consider. 6 Moore’s Federal Practice, § 56.15[3], p. 2340. Affidavits must be made on personal knowledge. Ark. Stat. Ann. § 29-211 (e) (Repl. 1962); 6 Moore’s Federal Practice, § 56.11 [1-2], p. 2145; Walling v. Fairmont Creamery Co., 139 F. 2d 318 (8th Cir. 1943); Zampos v. U. S. Smelting, Refining & Miming Co., 206 F. 2d 171 (10th Cir. 1953). Testimony that would not he admissible at the trial may not be set forth in affidavits supporting or opposing summary judgment. DePinto v. Provident Security Life Ins. Co., 374 F. 2d 50 (9th Cir. 1951) Where written documents are relied upon, they must be exhibited in full. Neither the statement of their substance, the affiant’s interpretation of them nor his conclusions drawn therefrom are sufficient. Wailing v. Fairmont Creamery Company, supra. While an affidavit may be used to introduce documentary proof, the written material should be attached to the affidavit and served with it. Sprague v. Vogt, 150 F. 2d 795 (8th Cir. 1945) ; 6 Moore’s Federal Practice;, § 56.11 [1.-2], p. 2145. Statements of legal conclusions and references to papers to which no sworn or certified copy is attached should be disregarded. State of Washington v. Maricopa County, 143 F. 2d 871 (9th Cir. 1944).

Important questions as to credibility and right of cross-examination might also arise, particularly in view of the fact that information as to the Rees bank accounts was peculiarly within the knowdedge of appellee.

Yet, appellants did not file controverting affidavits, as they might have pursuant to Ark. Stat. Ann. § 29-211(e) (Repl. 1962), or move for a continuance under § 29-211 (f) (Repl. 1962), or avail themselves of discovery procedures under § 28-348 et seq. (Repl. 1962). Nor did they by any objection at any time raise any question of credibility, right of cross-examination or admissibility of testimony.

By the great weight of authority it is not reversible error for a trial court to consider a defective statement or affidavit on motion for summary judgment in the absence of a motion to strike or other form of objection specifying the deficiencies therein. 6 Moore’s Federal Practice, § 56.22 [1], p. 2817; Mitchell v. Dooley Bros., 286 F. 2d 40 (1st Cir. 1960), cert. denied, 366 U. S. 911, 81 S. Ct. 1086, 6 L. Ed. 2d 236; Klingman v. National Indemnity Co., 317 F. 2d 850 (7th Cir. 1963); U. S. v. Western Electric Co. Inc., 337 F. 2d 568 (9th Cir. 1964); Scharf v. Waters, 328 Ill. App. 525, 66 N. E. 2d 499 (1946); Baum v. Martin, 335 Ill. App. 277, 81 N. E. 2d 757 (1948); Republic Chemical Corp. v. United Sterling Corp., 205 Misc. 730, 118 NYS 2d 368, aff’d, 281 App. Div. 1018, 121 NYS 2d 272 (1953). It has been said that the objection must be specific. See, e. g., Grubbs v. Slater, 266 S. W. 2d 85 (Ky. 1953). Failure to object is sometimes said to constitute a waiver. See Scharf v. Waters, supra; Republic Chemical Corp. v. United Sterling Corp., supra; Hall v. Fowler, 389 S. W. 2d 730 (Tex. Civ. App. 1965). Yet it would not be error for the: court to disregard inadmissible evidence on motion for summary judgment in the absence of any objection. Mitchell v. Dooley Bros., supra. It has been said, also, that objection should be made in the trial court in order to afford an opportunity for correction of the objectionable defects. Hall v. Fowler, supra. It is also said that objections to formal deficiencies based on incom-peteney of evidence should not be raised on appeal for the first time. Youngstown Sheet & Tube Co. v. Pennsylvania, 363 S. W. 2d 230 (Tex. 1963).

These rules and the reasons therefor seem to me to be applicable in this case.

I concur fully in the majority opinion on all other issues.

       The check presented to the bank by Mrs. Chandler was dated on August 18, instead of 19, and was drawn by Rees on another account, which it had in the Citizens Bank.

       According to Section 85-4-104, “midnight deadline with respect to a bank is midnight on its next banking day following the banking day on which it receives the relevant item or notice or from which the time for taking action commences to run, whichever is later.”

       An order denying a motion for summary judgment is merely interlocutory, leaving the case pending for trial, and is not appeal-able; however, in holding that the court did not -err in granting the summary judgment to the bank, the question of whether appellants were entitled to summary judgment is necessarily answered in the negative.


author: George Rose Smith, Justice. John A. Fogleman, Justice,

text:
    John R. THOMPSON, Trustee v. Nina P. DUNLAP
    5-4408
    424 S. W. 2d 360
    Opinion delivered February 26, 1968

      Jones & Stratton, for appellant.

      Robert W. Henry, for appellee.
   George Rose Smith, Justice.

James W. Dunlap, at his death in 1957, was a resident of Faulkner county, where Ms will was probated. Two-tbirds of bis estate, consisting of lands in WMte and Faulkner counties, was left to tbe appellant as trustee, with directions that he pay $150 a month to the appellee, Dunlap’s widow, during her lifetime, with remainder to other beneficiaries. The will provided that in the event of “unusual economic inflation, it is my desire that the Chancery Court shall have authority to adjust the amount of income. . . to he turned over monthly to Nina P. Dunlap.”

In 1967 Mrs. Dunlap filed this proceeding in the Faulkner Chancery Court, asserting that as a result of inflation her payments should he increased to $300 a month. The trustee, who resides in Lonoke county and was served with a summons in Pulaski county, questioned the venue and also defended the case on its merits. After a hearing the chancellor held (a) that he had jurisdiction, because Dunlap’s estate had been administered in Faulkner county, (b) that the payments should be increased to $200, and (c) that the trustee should file in the Faulkner Chancery Court proceeding a copy of the will and an inventory of the trust property and should thereafter submit annual accountings for the court’s approval. By direct appeal the trustee questions all three rulings; by cross appeal Mrs. Dunlap insists that her payments should be fixed at $300 a month.

(a) We do not agree with the chancellor’s conclusion that the venue was properly laid in Faulkner county. Yenue is governed by statute. This is not a local action within Ark. Stat. Ann. § 27-601 (Repl. 1962), because it does not involve the title to the trust realty. Nor is there any statutory basis for holding that merely because the trust was created by a will probated in the Faulkner Probate Court some ten years earlier, the Faulkner Chancery Court thereby inherited jurisdiction of tMs suit. The chancery court and the probate court are separate tribunals, each having its own jurisdiction. Ark. Const., Amendment 24; Lewis v. Smith, 198 Ark. 244, 129 S. W. 2d 229 (1939). Neither court derives its jurisdiction from the other.

If the testator had expressed a desire that the Faulkner Chancery Court should have authority to adjust the trust income, it might he said that the appellant agreed to that venue by accepting the appointment as trustee. But the testator referred merely to “the Chancery Court.” Some other chancery court might have proved to be the right forum — if, for example, all the interested persons were residents of another county. By elimination we conclude that this proceeding is a transitory action that should have been brought in the county where the defendant trustee resided or was summoned. Ark. Stat. Ann. § 27-613.

With respect, however, to this particular case, as distinguished from others that ,may arise later on, we agree with the appellee’s contention that the trustee waived his objection to the venue. He first appeared specially to file a motion to quash the service, which was overruled. He then filed an answer in which he attempted to preserve his special appearance. The trouble is that he included this request for affirmative relief: ‘ ‘ Defendant further pleads by way of his answer that his fees as trustee should be made current and the court should fix a reasonable attorney’s fee to be paid from the trust estate as costs in defending this action.”

In Federal Land Bank of St. Louis v. Gladish, 176 Ark. 267, 2 S. W. 2d 696 (1928), we explained why a demand for affirmative relief enters one’s appearance: “But one cannot come into court, assert a claim, ask the court for affirmative relief, and then, when there is an adverse judgment, claim that the court had no jurisdiction over his person. If this could be done, the appellant would have the opportunity and advantage of prosecuting its claim and, in case it recovered judgment, it could collect and at the same time take no chances of a judgment against itself.”

In that case we were referring to jurisdiction of the person, which is what is involved here. A defeat of venue goes to jurisdiction of the person and therefore may be waived. Gland-O-Lac Co. v. Greekmore, 280 Ark. 919, 327 S. W. 2d 558 (1959). That is manifestly the right view, there being no sound reason why a defendant should not be at liberty to enter his appearance and try the case in a county other than the one designated by the venue laws.

The point is not argued, but we have not overlooked the possibility that in some situations a defendant might, as a practical matter, be compelled to ask affirmative relief to avoid the risk of losing his rights under the statute that makes the assertion of a counterclaim mandatory. Ark. Stat. Ann. § 27-1121; Shrieves v. Yarbrough, 220 Ark. 256, 247 S. W. 2d 193 (1952). We do not reach that question here, because the trustee’s request that his fees be made current was not a proper counterclaim against the life beneficiary of the trust. Such a request involves primarily the trust property, as the beneficiaries are not personally liable for expenses of the trust. Restatement, Trusts (2d), § 249 (1959). The beneficiaries of the remainder interest in the trust should have been brought into the case if the trustee’s compensation was to be determined and paid from the trust assets. Hence, for want of all proper parties, the trustee’s failure to ask that his fees be fixed in this proceeding would not have precluded him from seeking that relief at a later date. It is therefore evident that the filing of the appellant’s request for affirmative relief was not mandatory under the counterclaim statute. (Even though the request was later withdrawn, it was effective as an entry of the trustee’s appearance.)

(b) The extent to which economic inflation called for an increase in the monthly payments to the testator’s widow was a question of fact in the court below. The trustee relied upon the Government’s cost-of-living figures to show that the increase had been only 18.1% since the testator’s death. The appellee’s proof would have supported much greater liberality in the award. Much of her testimony, however, went to show that, disregarding her other sources of income, she is unable to live on less than $300 a month. That is not the test, the issue being the extent to which economic inflation demands an increase in the monthly allowance. On conflicting proof we cannot say that the chancellor’s decision was against the weight of the evidence.

(c) The chancellor, on his own initiative, decided to supervise the administration of the trust from now on. Had the trustee requested such supervision of his stewardship, the court’s action would have been proper. Restatement, supra, % 260. But no such request was made. Judicial supervision of a trust unavoidably involves added expense in court costs and attorneys’ fees. In the absence of a direction by the creator of the trust that it be so supervised and of any peculiar facts suggesting the desirability of such judicial scrutiny, we are of the,opinion that the issue should not be raised by the court on its own motion, however desirable the court may think that course to be. True, the appellee now asks that the court’s directive be upheld, but she did not establish even a hint of misconduct on the trustee’s part that might call for an annual accounting’ in the chancery coiurt. We are of the opinion that the decree should be modified to delete the directive that in effect domesticates the trust in Faulkner county.

As so modified the decree is affirmed.

Fogleman AND Byed, JJ., dissent.

John A. Fogleman, Justice,

dissenting. Venue means the place, i. e., the county or district wherein a cause of action is to be tried. Gland-O-Lac v. Franklin County Circuit Court, 230 Ark. 919, 327 S. W. 2d 558. Where the court has jurisdiction of the subject matter in a transitory action, such as this case, and venue is determined by the domicile or residence of the defendant, venue may be waived. Arkansas Association of County Judges v. Green, 232 Ark. 438, 338 S. W. 2d 672; Gland-O-Lac v. Franklin County Circuit Court, supra; Crutchfield v. McLain, 230 Ark. 147, 321 S. W. 2d 217. This waiver can be accomplished by a failure of a defendant to make objection at the first opportunity and before taking some step indicating satisfaction with the venue or constituting an entry of appearance. Barnes v. Balz, 173 Ark. 417, 292 S. W. 391; Howe v. Hatley, 186 Ark. 366, 54 S. W. 2d 64; Mutual Benefit Health & Accident Ass’n v. Moore, 196 Ark. 667, 119 S. W. 2d 499; Arkansas State Racing Commission v. Southland Racing Corp., 226 Ark. 995, 295 S. W. 2d 617; Crutchfield v. McClain, supra; Gland-O-Lac v. Franklin County Circuit Court, supra; Arkansas Ass’n of County Judges v. Green, supra.

I have not been able to find any case, however, either in Arkansas or other jurisdictions that holds that the venue is waived by any act of the defendant when, as here, the objection is timely made and preserved.

As I see it, the real error in the majority opinion is in equating venue with jurisdiction of the person. Jurisdiction of the person is the power of the court to hear and determine the subject matter of a controversy between the parties to a suit, i. e., to adjudicate or exercise judicial power over them. Lamb & Rhodes v. Howton, 131 Ark. 211, 198 S. W. 521. It is the power to render a personal judgment in a particular case or to subject the parties to the court’s decisions and rulings. 21 C. J. S. Courts § 15, p. 32; Black’s Law Dictionary, 4th Ed., p. 992. It is based upon appearance of the person or the issuance and service of proper process upon him in the manner required by law. Bouvier’s Law Dictionary, Rawles 3rd Ed., p. 1761; Stevenson v. Christie, 64 Ark. 72, 42 S. W. 418; Federal Land Bank of St. Louis v. Gladish, 176 Ark. 267, 2 S. W. 2d 696; Healey & Roth v. Huie, 220 Ark. 16, 245 S. W. 2d 813; 20 Am. Jur. 2d Courts § 106, p. 465.

Equating “venue” in this case with “jurisdiction of the person” is not consistent with prior actions of this court. In cases involving venue, rather than question of service of process, it is said that a motion to dismiss for want of venue might he treated as a motion for change of venue and where well taken, the cause should be removed to the proper venue. Terminal Oil Co. v. Gautney, Judge, 202 Ark. 748, 152 S. W. 2d 309; Ft. Smith Gas Co. v. Kincannon, 202 Ark. 216, 150 S. W. 2d 968 (on rehearing). Had those cases been treated as if the question was one involving jurisdiction of the person, the only proper action would have been to dismiss them.

We would be more consistent if we followed the precedent in cases wherein venue was based on the residence of, or place where summons was served on, a codefendant. In these circumstances, it has been held that by filing a counterclaim (not then compulsory) a defendant, whose timely motion questioning venue had been overruled, did not.make the court his own forum so that he could not further question the judgment against him. Seelbinder v. Witherspoon, 124 Ark. 331, 187 S. W. 325. While this case is discussed as not having been applicable to the facts in Federal Land Bank v. Gladish, 176 Ark. 267, 2 S. W. 2d 696, cited by the majority, because the venue there was governed by a statute which specifically exempted a nonresident defendant from judgment where no judgment was rendered against a resident defendant, it is quite clear that venue was involved in the Seelbinder case and jurisdiction of the person in the Federal Lmid Bank case. That jurisdiction of the person was the governing principle in the Federal Land Bank case is made quite clear by these words in the opinion:

‘ ‘ The appellant in this case, by filing a counterclaim and asking for affirmative relief asking the court to give it judgment, thereby enters its appearance, and waives any defense there might be m the service or any failure to get proper service, if there was such failure. In other words, the defendant, by filing a 'counterclaim and asking 'affirmative relief in the court, thereby subjected itself to the jurisdiction of the court whether it had been served at all or not.” [Emphasis ours]

This statement clearly recognizes that the case was governed only by rules pertaining to appearance or proper service, the basis of jurisdiction of the person.

It seems to me that the rule pronounced here by the majority will lead to some undesirable results. Suppose, for instance, that because of the pendency of an action involving corpus personalty brought by a cestui que trust in the wrong venue, as this one was, it became advisable for the trustee to seek injunctive relief against the plaintiff in order to protect the trust property after his objection to the venue had been overruled. He could then be said to have submitted the trust to the trial of a proceeding in a county remote from the trust property, the records of the trust or witnesses who might be readily available at the proper venue but not at the improper one. I respectfully submit that the precedent is a bad one. Siich a result seems to me to be just as vicious as the rejected rule that one who appealed from an adverse ruling on a motion to quash for want of jurisdiction of the person thereby entered his appearance. See Anheuser-Busch Company v. Manion, 193 Ark. 405, 100 S. W. 2d 672. It is strongly indicated in Barger v. Oklahoma Gas & Elec. Co., 195 Ark. 107, 111 S. W. 2d 485, that where objection was made and preserved, such actions as .motions for continuance, requests for additional time to plead, contest of ¡motions and motions to transfer from law to equity should no longer be considered as voluntary appearances.

While I would not reach the other points treated by the majority, I would concur in the result reached on them.

I would reverse and dismiss.

I am authorized to state that Byrd, J., joins in this dissent.

       Such a situation could well arise under conditions which would make the filing of an independent action impossible or impractical.


author: Paul Ward, Justice.

text:
    Carlond HAMMOND v. STATE of arkansas, ex rel John Davis, Sheriff
    5311
    424 S. W. 2d 861
    Opinion delivered February 26, 1968
    [Rehearing denied April 1, 1968.]

      Darrell Hickman, for petitioner.

      Joe Purcell, Attorney General; Don Langston, Asst. Atty. General, for respondent.
   Paul Ward, Justice.

This is a review of a refusal by the Circuit Court of White County to grant Carlond Hammond (Petitioner) a Writ of Habeas Corpus whereby he sought to evade extradition to the State of Louisiana. A brief statement of facts from which stems this litigation is set out below.

On May 30, 1967 the Governor of Louisiana signed requisition papers directed to the Governor of Arkansas asking for the return of Petitioner who was charged in 1964 with the crime of stealing $25,000 in Louisiana. On August 2, 1967 a hearing was held on the matter in the office of the Governor of Arkansas, and one week later the Governor of Arkansas issued a warrant to have Petitioner arrested by the sheriff of White County and placed in jail. Thereupon Petitioner applied for a Writ of Habeas Corpus in the Circuit Court of said county to obtain his freedom. A hearing was had, and on September 6,1967 the trial judge denied the petition and remanded Petitioner to the custody of the sheriff of White County.

On September 22, 1967 Petitioner filed this Petition for a Writ of Certiorari, and now urges three grounds for a reversal of the trial court.

One. It is first contended “the Governor of Arkansas improperly delegated all responsibility for determining the validity of the extradition papers”.

We find no merit in this contention which is based on the fact that Bob Scott (an agent or employee of the Governor) exalmined the requisition papers and found them adequate before the Governor signed the warrant of arrest.

Ark. Stat. Ann. § 43-3002 (Repl. 1964) provides that it is the duty of the Governor to have arrested and delivered to another state any person charged in that state with a felony who has fled from justice. Section 43-3004 provides that the Governor may call upon the Attorney General to investigate or assist in investigating the “demand” and report to him. Section 43-3007 provides that if the Governor decides the “demand” should he complied with, “he shall sign a warrant of arrest. ...”

We find nothing in the above statutes which forces a conclusion that the Governor must personally make the investigation or have it made by the Attorney General. It must be recognized that a governor has the right to rely on his agents or employees to make investigations and report their findings, and to rely thereon. This is consistent with 'his right to call on the Attorney General for assistance and advice if he deems it necessary. Obviously the legality of the Governor’s action in signing the warrant of arrest in this case is not dependent on the source of the information upon which he acted.

Two. It is next argued that “The documents of ‘demand’ do not show probable cause. . . .”

Demand documents refer here to certain documents executed in Louisiana setting out the facts relative to the accusations against Petitioner. It is necessary therefore to set out below a brief summary of these documents.

(a) Morris Lucia who is a resident of Louisiana, in an affidavit sworn to before a District Judge of said state, stated, in essence: On May 13, 1964 Joe Fassulo, whom I knew, introduced me to Carlond Hammond (Petitioner) who told me he knew a “person” who had $200,000 in bills of large denominations and desired to exchange them (at a 40% discount) for bills of smaller denominations; Petitioner stated the deal was legitimate since the “person” had previously been in trouble with the revenue agents and feared circulation of the large bills might renew the trouble; a week later I was informed by Joe that Petitioner had arranged for me to meet the “person” at a hotel in Opelousas to effect an exchange of bills; Joe and I went to the hotel where I was told the “person” would not negotiate per-sonallv 'with me; Therefore, I gave Joe $25,000 to deliver to the “person”; About twenty minutes later Joe returned and said Petitioner took the money and “disappeared into the night”. [On the same day af-fiant proceeded to have Petitioner charged with theft.]
(b) On June 16, 1964 the Governor of Louisiana issued a signed document stating that he was informed Petitioner had taken refuge in Arkansas; that he had (made an application to the Governor of Arkansas for the surrender of Petitioner, and had appointed an Agent to take Petitioner in custody. [All the above mentioned documents were forwarded to the Governor of Arkansas.]

For reasons, not made entirely clear in the record, the extradition proceedings were delayed until May 30, 1967 when the Governor of Louisiana made another application to the Governor of Arkansas, based on the documents previously mentioned.

Based on the above documents, it is our opinion that the trial court was correct, and that the extradition of Petitioner was justified and legal. Conceding that Lucia did not actually see Petitioner take his money, he did know and swear that Petitioner was an active participant in the scheme to deprive him of his money. This fact would make Petitioner a participant in the crime charged. Ark. Stat. Ann. § 43-3002 (Repl. 1964), in part reads:

“. . . it is the duty of the Governor of this state to have arrested and delivered up to the Executive Authority of any other state of the United States any person charged in that state with treason, felony, or other crime, who has fled from justice and is found in this state.”

The pertinent Louisiana law is clear. L. S. A. § 14:23 reads:

“The parties to crimes are classified as (1) Principals and (2) Accessories after the fact.”

L. S. A. § 14:24 reads:

“All persons concerned in the commission of a crime, whether present or absent, and whether they directly commit the act constituting the offense, aid and abet in its commission, or directly or indirectly counsel or procure another to commit the crime, are principals. ’ ’

Three. Again we are unable to agree with the contention that this proceeding violates due process under the doctrine of res judicata. Petitioner here relies on the alleged fact that previously an attempt was made to ■have him extradited but failed because of a lack of sufficient evidence.

Conceding the above allegation to be true it would not, in our opinion, constitute res judicata. Black’s Law Dictionary defines “Res judicata” as: “A matter adjudged; a thing judicially acted upon or decided; a tiling or matter settled by judgment.” In Am. Jur. (Extradition) § 57, there appears this statement:

“Where a first application for extradition is refused on the ground that the evidence presented is insufficient, it leaves the proceeding in the same condition as in other cases of preliminary examination, and there may be a second inquiry. The release of a person on the ground of informality or mistake in the proceeding’s is not a bar to a subsequent arrest on perfected papers or legal proceedings.”

The case of Letwick v. State, 211 Ark. 1, 198 S. W. 2d 830, dealt with this issue on facts similar to those of this case, and the Court said:

“There is no question of former jeopardy in this case. Indeed the question is whether appellant shall be returned for a trial to the state where the offense is alleged to have been committed.”

The Petition is denied.