text:
    Horn v. Hull.
    Opinion delivered October 5, 1925.
    1. Judgment — constructive service — retrial.—.Crawford & Moses’ Digest, § 6266, .providing that a defendant constructively summoned and who does not appear may, at any time within two years after the rendition of the judgment, and not thereafter, appear in open court and move to have the action retried, does not provide a right of redemption from the sale of mortgaged property, but only a retrial of the cause, and, if successful, defendant may obtain an order on the plaintiff for a restitution of the proceeds of the sale of property.
    2. Judicial sales — inadequacy of price. — .Mere inadequacy of price ■is not ground for setting aside a judicial sale unless, the price is so grossly inadequate as to raise a presumption of fraud or unfairness.
    3. Judicial sales — 'Inadequacy of price. — 'Evidence held not to establish that property wias sold at judicial sale for a grossly inadequate price.
    4. Judgment — premature rendition — remedy.—.While the premature rendition of a decree is erroneous, the remedy to correct the error is by appeal to the Supame Court, and not by motion to vacate the decree in the court which rendered it after adjournment of the term. .
    5. Judgment — relief against default — meritorious defense.— Before a court of equity will relieve against a judgment by • default for want of service on the defendant, the latter must aver and prove that, if the relief is granted, a result will he obtained different from that reached by the judgment complained of.
    6. Appeal and error — conclusiveness of chancellor’s finding.— A finding of the chancellor that the defendants in a foreclosure proceeding were served with process and knew of the pendency of the pro.ceeding will not be set aside on appeal where it is not against the weight of the evidence.
    7. Equity — -laches.-—-The doctrine of laches rests upon the principle that, if one maintains silence when he ought to speak, equity will bar him. from speaking when in conscience he ought to remain silent.
    8. Equity — laches.—Where the defendants in a foreclosure suit remained silent while those -purchasing under -the sale expended large sums of money in drilling oil and g-as wells in the land in question, and waited three years until the property had greatly enhanced in value before suing to -set aside the sale, they are barred by laches.
    Appeal from Union Chancery Court, Second Division; George M. LeCroy, Chancellor;
    affirmed.
    STATEMENT BY THE COURT.
    Appellants brought this suit in equity against appellees to set aside a decree of foreclosure and sale thereunder by the commissioner of certain lands in Union County, Ark., and also to set aside certain deeds executed by fhe purchaser at the foreclosure sale to subsequent purchasers of said lands.
    Appellants interposed several def enses to the action. J. M. Wells, Samuel A. Martin, and J. E. B. Moore originally owned the lands involved in this suit and gave a deed of trust in favor of D. D. Hull, Jr., to secure an indebtedness to Mm of $27,000 and the accrued interest and ,a balance of $4000 due him on a judgment against them. The lands included in the deed of trust comprised 3875 acres, and are set out in the complaint. Wells, Martin -and Moore entered into a contract with Leo, Harry, and Ben P. Horn to sell and exchange said lands with them for their equities in certain real estate owned by them in Memphis, Tenn., and the balance to be paid in money. Pursuant to this contract, Leo, Harry, and Ben P. Horn executed to Wells, Martin and Moore, eighteen promissory notes aggregating $58,575,- all dated February 15, 1916, and extending’ over a period of ten years. Leo, Harry, and Ben P. Horn executed a deed of trust to said lands to W. E. Patterson, trustee, to secure said indebtedness. The notes and deed of trust were at once indorsed and assigned by Moore, Wells and Martin to D. D. Hull, Jr. in lieu of the original deed of trust to said lands to him from Moore, Wells and Martin. On December 9, 1915, Leo, Harry and Ben P. Horn conveyed said lands to >S. L. and J. C. Cockroft, who assumed to pay off the indebtedness to D. D. Hull, Jr. Default was made in the payment of the first note for $3000, which was due on February 1, 1916. Default having been made in the payment of the first note, under the terms of the deed of trust, the whole indebtedness aggregating $58,575 became due and payable. On the 7th day of July, 1916, D. D. Hull, Jr., and W. E. Patterson, trustee, filed a bill in the chancery court of Union County, Ark., against Leo, Harry, and Ben P. Horn and S. L. and J. C. Cockroft and J. M. Wells, Samuel A. Martin and J. R. B. Moore, to foreclose said deed of trust. J. R. B. Moore and J. M. Wells were personally served with summons. Moore made default buit Wells defended the suit to some extent. The three Horns, two Cockrofts'and Samuel A. Martin were proceeded against as non-residents, and the decree recites that they were constructively summoned by publication of a warning order and by service upon each of them of a certified copy of the complaint with the summons attached.
    On the 9th day of September, 1916, a decree of foreclosure was entered of record, and time was fixed in the decree for the payment of the indebtedness in the sum of $51,59'9.50. The decree recited that if this amount together with the amount found due for taxes with interest on each sum be not paid on or before October 18, 1916, a commissioner appointed for that purpose, should proceed to sell the lands pursuant to the terms of the decree and apply the proceeds of sale as directed by the court. The report of sale recites that the lands were sold on November 21, 1916, to D. D. Hull, Jr. A commissioner’s deed was executed to D. D. Hull, Jr., the purchaser of the lands described in the decree, on March 5, 1917, and this deed recites that it was presented in open court for approval and by the chancery court examined and approved. The clerk’s certificate shows that the 'commissioner’s deed was filed for record April 11,1917, and recorded on the s'ame day. On the first day of June, 1917, D. D. Hull, Jr., executed a deed to said lands to Thomas Polk and Harry Ezzell for a consideration re'cited to be partly in cash and partly on a credit.
    On February 21, 1921, Harry Ezzell executed to his two sons, Harry Ezzell, Jr., and Sharp Ezzell a deed conveying to them an undivided two-thirds of an undivided one-half interest in said lands. During the years 1921 and 1922 Polk and Ezzell executed oil and gas leases to a part of said lands. In May, 1920, S. L. Cockroft died intestate, leaving his widow and seven children. For some time prior to his death he had not lived in Memphis, Tenn., -where Leo, Harry, and Ben P. Plorn have lived during all the time embraced by the matters in this lawsuit. S. L. Cockroft died somewhere out west on May 6, 1920. Sometime prior to the death of S. L. Cockroft, Leo-, Harry and Ben P. Horn had endeavored to effect a settlement with him with the view of having him pay off the mortgage indebtedness and conveying the lands back to them. The Horns found out from Cockroft that the deed of trust on the lands in controversy had been foreclosed, and they had been endeavoring* to get Cockroft to pay off the indebtedness secured by the deed of trust in order that they might file a suit to set aside the decree of foreclosure and to recover the lands. After S. L. Cockroft died, the attempted settlement was delayed because one of Cockroft’s boy had gone to the World War, and two of them were minors. The settlement was not effected until sometime in July or August, 1923, when the Horns procured deeds from the widow and all the Cockroft children. The' present suit was instituted on September 7, 1923. Oil was discovered in and around El Dorado, Union County, Ark., in 1921, and the land has greatly increased in value since that time. About twenty-one wells have been drilled on the lands in controversy and at a conservative estimate lands in dispute are now worth five or six hundred thousand dollars.
    Other facts will be stated and discussed under appropriate headings in the opinion.
    The chancellor made a general finding as to all matters of law and fact in favor of appellees, who were the defendants in the chancery court. It was therefore adjudged and decreed by the court that the complaint of appellants, who were plaintiffs in the court below, be disr missed for want of equity.
    The plaintiffs, Leo, Harry, and Ben P. Horn, have duly prosecuted an appeal to this court and are designated appellants here.

      B. C. Brown, for appellant.

      Bcdterson $ Bector, for appellee.
   Hart, J.,

(after stating the facts.) It may be- stated at the outset that the court did not err in refusing to vacate the original foreclosure decree on application of the appellants in that action under § 6266 of Crawford & Moses’ Digest. The statute provides that a defendant constructively summoned, and who does not appear, may at any time within two years, and not thereafter, after the rendition of the judgment appear in open court and move to have the action retried. In such cases there is no right of redemption from the sale of the mortgaged property, and the only remedy for the defendant is that afforded by the statute, to have a retrial of the cause and, if successful, to obtain an order on the plaintiff for a restitution of the proceeds of the sale of the property. Gleason v. Boone, 123 Ark. 523.

It was also held in that case that mere inadequacy of price is no ground for setting aside a judicial sale unless it is «O' gross ias to raise a presumption of fraud or unfairness. This rule has been repeatedly declared by this court and has been so uniformly adhered to that a further citation of cases in support of it is unnecessary.

In this connection it may be stated that the property was sold under the foreclosure decree before the discovery of oil and gas in the territory where they were situated and before the lands had risen in value at all. There is no testimony in the record tending to show that the price at which they were sold was grossly inadequate. Indeed, the attending circumstances point to the contrary.

In January 1915, Wells, Martin and Moore, who then owned the lands involved in this suit, sold them to appellants for the equities which appellants owned in certain property in Memphis, and the further consideration that appellants would assume certain indebtedness on the property owed by the grantors to D. D. Hull, Jr. Appellants then sold the property to the Cockrofts upon consideration that they should assume the mortgage indebtedness to D. D. Hull, Jr. They knew that the original indebtedness to D. D. Hull, Jr., was past due when they bought the lands from Wells, Martin and Moore. Appellants also knew that D. D. Hull, Jr., had canceled the old indebtedness in consideration that they should assume the amount of it and execute a new mortgage or deed of trust to him. They knew that the Cockrofts had assumed the indebtedness, and that one of the notes became due in February, 1916. They are presumed to have read over the deed of trust and to have known that the failure to pay this note made the whole of the indebtedness due and payable. They resided in Memphis at the time the foreclosure decree was rendered, and their general inattention to the matter shows that they did not anticipate any great increase in the value of the lands. Indeed, the increased value was due solely to the discovery of oil and gas in that territory in 1921, which was several years after the lands were sold under the foreclosure decree:

It is next insisted that the foreclosure decree was prematurely entered of record, and that no service of summons was had in that proceeding upon appellants. The mere fact that the decree might have been prematurely entered of record does not entitle appellants to the relief sought 'here. The premature rendition of a decree is erroneous; but the remedy to correct the error is by appeal to this court, and not by motion to vacate the decree in the court which rendered it after adjournment for the term. Old American Ins. Co. v. Perry, 167 Ark. 198.

Counsel for appellants contend that there wias not proper service upon them in the mortgage foreclosure proceedings, and on this account the chancery court should shave set aside the decree of foreclosure and the sale thereunder. Conceding that no service was had upon appellants in that suit, they are not entitled to the relief sought. This court has repeatedly held that the better established rule unquestionably is that, before a court of equity will relieve .against a judgment for want of service on the defendant, the latter must aver and prove that, if the relief is granted, a result will be obtained different from that reached by the judgment complained of. Broadway v. Sidway, 84 Ark. 527; State v. Hill, 50 Ark. 458; Williams v. Alexander, 140 Ark. 442; Jerome Hardwood Lumber Co. v. Jackson-Vreeland Land Corporation, 160 Ark. 303; McDonald Land Co. v. Shapleigh Hdw. Co., 163 Ark. 524; and H. G. Pugh & Co. v. Martin, 164 Ark. 423.

It has been well said that infinite confusion and mischief would ensue if the rule were otherwise. No meritorious defense to the .foreclosure proceedings is set up or attempted to be proved in the case at bar. The mortgage indebtedness was due at the time that the foreclosure decree was entered of record. The only claim of appellants is that the lands were sold for an inadequate price, and, as we have already seen, this is no defense unless it could be shown that the price was grossly inadequate. It does not appear from the record that the lands; sold under the foreclosure decree for a grossly inadequate sum. The price of the land, as we have already seen, did not increase for several years after-wards, and the increase then was due solely to the discovery of oil and gas in the vicinity. Then too the chancellor made a general finding of all the issues of law and fact against the appellants. This included a finding that they were served with process in the mortgage foreclosure proceedings. The burden of proof was upon appellants to show to the contrary. Davis v. Ferguson, 164 Ark. 340.

The record in .the case recites that appellants and the Cockrofts were non-residents of the State of Arkansas and were served with a certified copy of the complaint with .summons annexed, and also that a warning order .for each of said non-residents was duly issued and published.

It is true that all three of appellants testified that they were not served in the case .and did not know of the rendition of the foreclosure decree until after the lands were sold. It will be remembered that the lands have greatly increased in value and are now worth between five and .six hundred thousand dollars. Appellants are therefore greatly interested in setting aside the mortgage foreclosure proceedings; and their1 testimony is directly contradicted by Percy G-albreath. It is undisputed that the Horns, the Cockrofts, and Gfalbreath all lived in Memphis, Tenn., - at the time of the foreclosure proceeding. Galbreath testifies that he remembered perfectly well serving a copy of the complaint upon the Horns and the Cockrofts. There appears a return made by him at the time which he recollects having made. Judge Patterson, who was the attorney for the plaintiffs in the foreclosure proceedings, testified that he remembered very distinctly of having a warning order for appellants published four times in a weekly newspaper published in El Dorado, Ark., and that he giave the attorney ad litem in the case the addresses of appellants and of the Cockrofts. Judge Patterson remembers distinctly of bringing the response of the attorney ad litem and the proof of the publication of the warning order in court and filing them. Judge Patterson was trustee in the deed of trust, and his recollection about the matter is on that account definite. It is worthy of note that the attorney ad litem of the non-resident defendants died in November, 1921.

J. M. Wells, .one of the defendants in the foreclosure suit, made a partial defense to the action. According to his testimony, he had the most to do with making the contract with the Horn brothers. He received notice from Hull that one of the notes for the lands given by the Horn brothers was due, and that default had been made in the payment of the note. Wells notified the Horn brothers that he had received notice of default in the payment of the notes and asked them to make satisfactory arrangements. He received no reply to this letter. When he was advised that a decree had been rendered in the case, he notified thetai by letter and told them 'something had to be done or the lands would be sold. He stated further that the lands were not worth at the time more than the mortgage indebtedness.

Under these circumstances, it can not be said that a finding by the 'chancellor that appellants had been served with process in the foreclosure proceedings and knew of the pendency of that suit is against the preponderance of the evidence, and it is' well settled in thi.s court that a finding of fact made by a chancellor will not be set aside upon appeal unless it is against the weight of the evidence.

If appellants knew of the pendency of the foreclosure proceedings and failed to assert their rights, it is now too late for them to have the decree set. aside on the ground that they were not served with process. Holman v. Lowrence, 102 Ark. 252; Little Rock Chamber of Commerce v. Reliable Furniture Co., 138 Ark. 403; and Crawley v. Neal, 152 Ark. 232.

Counsel for appellees have also invoked the plea of laches, and we are of the opinion that, under the facts established by record, appellants .are barred of any relief on this account.

As we have already seen, the foreclosure decree was entered of record on the 9th day of 'September, 1916, and the lands were sold on November 21, 1916, pursuant to the terms of the decree. The deed executed by the commissioner shows that the sale was approved by the court on the 5 th day of March, 1917. According to the evidence of appellants, S. L. Cockroft died in May, 1920, and they knew sometime prior to. his death of the existence, of the foreclosure decree and the sale thereunder. This suit was not commenced until the 7th day of September, 1923. Appellants attempt to give reasons for their delay in the premises; but none of them are satisfactory. It appears from the record that oil and gas were discovered in that territory in the early part of 1921 and that valuable oil and gas leases were given on part of the lands in controversy during the years 1921 and 1922. Hull had sold the lands to Polk and Ezzel'l. They in turn had executed the oil and gas leases to other parties and had received considerable sums of money therefor. Twenty-one oil and gas well were drilled on the lands, and the lands have greatly increased in value since the first part of 1921. At a conservative estimate they are now worth between five and six hundred thousand dollars.

As above stated, appellants knew of the existence of the foreclosure decree before the death of S. L. Cockroft in May, 1920. No excuse is made by them for their delay in bringing the suit, except that one of the Cockroft boys was a soldier in the World’s War and that two of them were minors, and that for this reason they could not effect a settlement with them until just before this suit was brought on September'7, 1923.

The doctrine of laches which is a species of estoppel rests upon the principle that, if one maintains silence when in conscience he ought to speak, equity will bar him from speaking when in conscience he ought to remain silent. Gibson v. Herriott, 55 Ark. 85; Jackson v. Becktold Printing & Book Mfg. Co., 86 Ark. 591; Davis v. Harrell, 101 Ark. 230; Brownfield v. Bookout, 147 Ark. 555; and Stewart Oil Co. v. Bryant, 153 Ark. 432.

Under these and many other decisions of this court which might be cited, the general rule of the doctrine of laches is that equity may in the exercise of its own inherent powers refuse relief where it is sought after undue and unexplained delay, and where injustice would be done in the particular case by granting the particular relief asked. Bach case must be governed iby its own facts; what would be an unreasonable delay in one case might not be in ¡another. We deem it sufficient to say that the delay in this case extended over a period of nearly three years and during a part of this time, oil wells were 'being drilled in that territory. Appellants could not wait until the drilling of these wells on the lands in question and in that vicinity had caused them to increase greatly in value before they brought this suit. They could not stand by and see other parties in good faith expending large sums of money drilling oil and gas wells and wait until the property was greatly enhanced in value thereby before asserting their rights. This would be contrary to the plainest principles of equity and natural justice.

Under all the circumstances of the case, we are of the opinion that the decision of the chancellor was correct, and the decree will therefore be affirmed.


source: Caselaw Access Project

author: Hart, J.,

license: Public Domain

text:
    Miller Lumber Company v. Floyd.
    Opinion delivered October 5, 1925.
    1.. Appeal and error — conclustveness op former opinion. — The Supreme Court will not in the same cause reverse or revise its former decision recorded at a previous term.
    2. Taxation — severance tax act — construction.—Under the severance tax act (Acts 1923, p. 67), which provides - (in § 4) that the severance tax shall not be required of the individual owner of timber who utilizes timbear cut from his premises in constructing •and repairing structures thereon, held that the owner is liable for the tax whenever timber cut from the land is sold, or where, desiring to clear the land, he hires persons to sever the timber; but where he leases the land to he cleared and allows the lessee to remove the timber, the lessee is liable for the tax.

      3. 'Taxation — severance tax — liability op landowner. — -Where a landowner makes a contract with another person to cut and remove the timber from Ms land for sale or commercial purposes, the owner must pay the severance tax.
    Appeal from. Pulaski Chancery Court; G. W. Hendricks, -Special ‘Chancellor;
    affirmed.
    statement by the court.
    This suit was originally brought in the chancery court by 'appellants against appellees to enjoin them from enforcing an act of the Legislature approved February 14,1923, and commonly known as our Severance Tax Act.
    Appellees filed a\ demurrer to the complaint which was overruled by the chancery court, and appellees refusing to plead further, a final decree was entered of record granting the relief prayed for. An appeal was duly prosecuted to this court, and it was held that the act was not a violation of our Constitution,- and the validity of the act was sustained -by this court as an occupation tax. The decree of the chancellor was therefore reversed, and the cause remanded for further proceedings not inconsistent with the opinion. Floyd v. Miller Lumber Co., 160 Ark. 17.
    Upon a remand ;of the case, appellants filed an amended complaint in which they raised issues as to the •proper construction of the act and its applicability to them. The chancery court sustained a demurrer to the ■amended complaint -and gave appellants leave to -amend further. Appellants refused to plead further, and it was decreed' that the amended complaint • be- dismissed for want of equity. The case is again here on appeal.

      W. R. Satterfield, Hughes & Hughes, Daggett & Daggett and Coleman, Robinson & House, for appellant.

      H. W. Applegate, Attorney General, and Brooks Hays, Assistant, for appellee.

      John I. Moore, amicus curiae.

   Hart, J.,

(after stating the facts.) This is the second appeal in this case. As above stated, the opinion on the former appeal is reported in 160 Ark. 17, under the style Floyd v. Miller Lumber Company. Counsel for appellants say that the original complaint was drafted with a view of raising the sole issue -of the constitutionality of the Severance Tax Act. The Legislature of 1923 passed an act to levy ia privilege or license tax upon all persons, firms, -and corporations engaged in the business of severing our natural resources from the soil or water. General Acts of Arkansas, 1923, p. 67.

Appellants attacked the act on the ground that it was in violation of so much of § 5, art. 16, of our Constitution, which reads as follows: “All property subject to taxation shall be taxed according to its value, that value to be ascertained in such manner -as the General Assembly shall direct, mailing the same equal and uniform throughout the State. No- one species of property from which a tax may be collected shall be taxed higher than another species of property of equal value, provided the General Assembly shall have power from time to time to tax hawkers, peddlers, ferries, exhibitions and privileges, in such manner as may be deemed proper,” etc.

Four members of this court for different reasons held that the 'statute was a tax upon persons engaged in a particular line of business, and that it was not a property tax.

Having reached' the conclusion that the tax levied by the statute was -a tax on business -and not on property, four members of this court for different reasons united in a decision that the tax was an occupation tax and not a property tax, and therefore was not in violation of the provision of the Constitution -above quoted. Whether this decision was right or.wrong, it is the law of the case; it is res judicata. The rule has been long established-in this 'State and uniformly adhered to that in the same cause this court will not reverse nor revise its former deeisons. Fortenberry v. Frazier, 5 Ark. 200; Porter v. Doe, 10 Ark. 186; Taliaferro v. Barnett, 47 Ark. 359; Vogel v. Little Rock, 55 Ark. 609; United States Annuity & Life Ins. Co. v. Peak, 129 Ark. 43; Danaher v. S. W. Tel. & Tel. Co., 137 Ark. 324; Ft. Smith Lbr. Co. v. State of Arkansas, 138 Ark. 581; Stuart v. Barron, 148 Ark. 380 ; Mo. Pac. Rd. Co. v. Walnut Ridge-Alicia Road Imp. Dist., 160 Ark. 297; St. L. S. F. R. Co. v. Kirkpatrick, 162 Ark. 65, and numerous other cases cited under the head of Appeal and Error in 1 Crawford’s Digest, § § 405 and 5 Crawford’s Digest, § 405. This general rule is grounded on public policy, experience, and reason. If all questions that have been determined by this court are to be regarded as still open for discussion and revision in the same cause, there would be no end of their litigation until the financial ability -of the parties and ingenuity 'of their counsel had been exhausted. A rule that has been so long established and acted upon and that is so important to the practical administration of justice in the courts should be followed and not departed from.

On this question in the case of Hart Steel Co. v. Railroad Supply Co., 244 U. S. 294, Mr. Justice Clark, speaM ing for the Supreme Court of the United States, said: i£This doctrine of res judicata is n'ot a mere matter -of practice or procedure inherited from a more technical time than ours. It is a rule -of fundamental and substantial justice, £<of public policy and private peace,’ which should be cordially regarded and enforced by the courts to the end that rights -once, established by -the final judgment of the court of competent jurisdiction shall be recognized by those who are bound by it in every way, wherever the judgment is entitled to respect. Kessler v. Eldred, supra.”

But counsel for appellants claim that the general rule of the law of the case 'should not be applied because their amended complaint has broadened the issues and raised among other things the question of the proper construction of the act and its applicability to appellants. This however does not bring them within any recognized exception to the general rule.

Counsel for appellants admit that their -original complaint was drafted with the view of raising the sole issue uf the constitutionality of the Severance Tax Act and thereby admit that that issue was squarely and correctly submitted to the court for its hearing and determination. The act was held to be eoDistitutional on the ground that it was an occupation tax, and no testimony or raising of additional issues as to the construction of the act or its applicability to appellants can prevent our former decision and judgment from being the law of the case. Indeed, it is difficult to see how any sort of testimony 'could change the issue as to the constitutionality of the act. That issue was squarely presented by a construction of the act and the 'section of our Constitution which it was claimed was violated.

Whatever views the different members may entertain as to the soundness of our former decision, the four members of the court who made it agree that the decision upholding the validity of the act as an occupation tax must he regarded as the law of the case.

In this connection, on account of the public importance of the act, the writer deems it appropriate to correct what he considers an erroneous interpretation of his separate opinion oni tihe former appeal.

Counsel for appellants say that Mr. Justice Hart bases the validity of the act on the police power of the State and naively add that they hope he will change his opinion in view of the fact that every one admits that the act was passed for the purposes of revenue. Taxation may he for the purpose of raising revenue, or for the purpose of regulation. Where it is levied for the purpose of regulation, it is an exercise of the police power of the State,, and it is undoubtedly true that the statute in question was passed for the purpose of raising revenue. The writer was of the opinion that the act was not obnoxious to the constitutional provision quoted above, which is nota limitation upon the police power, hut upon the taxing power of the State. The writer merely intended to say that the word, “privileges,” as used in the Constitution, meant that the General Assembly should have power from time to time to tax occupations for revenue which, are privileges within the meaning of the proviso. He then stated that he thought the word “privileges” was broad enough to include all classes of occupations which might be regulated under the police power.

This is quite a different thing from saying that the tax was levied under the police power of the State. He intended to say that the tax was levied under the taxing power of the State, and he was only attempting to define the class of occupations upon Which he thought the framers of the Constitution intended that the proviso should operate. In short, he thought that the framers of the Constitution, instead of using the word “privileges” to mean whatever occupations the Legislature might 'choose to declare and tax as such, undertook to restrict the meaning of the word to include only such occupations as might be regulated under the police power, but meant that the tax would be levied under the taxing power by the proviso of the Constitution just referred to and not under the police power of the State.

This brings us to a consideration of the construction of the statute with reference to the persons affected by its terms. One of the primary rules governing legislation of this sort is that the istatute ¡must act uniformly upon all within the class. In the application of the rule, the Supremo Court of the United States has held that the selection of all who are engaged within the State in mining ore,- or producing ores on their own account, that is to say, as owners or lessees, as the subject of an occupation tax, is permissible under the Constitution of the State of Minnesota. Oliver Iron Co. v. Lord, 262 U. S. 172.

Section 1 of the present act provides in effect for the levying of a privilege or license tax upon each person, firm, or corporation called the producer engaged in the business of mining, cutting, or otherwise severing from the soil or water for commercial purposes natural resources including timber and all other forest products of the soil or water of Arkansas.

.Section. 4 contains a proviso that the act shall not apply to- nor shall any severance" tax be required of the individual owner of timber who o-ccasionally severs -or cuts from his own premises such stocks, logs, poles, or other forest products as are utilized by him in the construction or repair of his own structures -or improvements. 'Continuing, it is declared that1 the- purpose of this clause is to exempt therefrom such severers as utilize forest products to their own personal use and not for sale, commercial gain or profit.

Section 8 -provides that the payment of said privilege taxes shall be required of the severer or producer actually engaged in the operation of severing natural products, whether as -owner, lessee^ concessionaire or contractor.

It is -apparent then that the owner of lands, who outs down trees for the purpose of building fences or repairing and constructing houses and other improvements on the land from the timber thus severed from the soil is exempted from paying the tax. It is equally evident that when the timber severed from the soil is sold, it falls within the terms of the act, and the tax must be paid by -some one. To illustrate: if the owner of timber lands desired to sever it for the purpose of clearing the land -and putting it in cultivation and hired other persons to sever the timber for him, he would be required to pay the -severance - tax. If the owner should lease his land to another person for a designated number of years in order to have.his lessee clear the land and put it in cultivation, and if the consideration for the lease in wh-o-le or in part was that the lessee should have the timber so removed from the land, the severance tax would have- to be paid by such lessee. It will be noted that the language of the act i-s specific on this subject and provides that the severer or producer as he is called shall pay the tax. The act is very broad and comprehensive, and is levied upon all persons engaged in severing the timber from the soil -for sale or commercial purposes, regardless of the purpose ' for which it is done. The only exception is that the. tax shall not be paid where the timber severed is actually used in erecting or repairing structures and other improve: ments on the land. The application of the timber.in part payment for clearing the land is a -severing of it for commercial purposes, although the primary purpose of -severing it is to enable the land to be put in cultivation. Where a landowner makes a contract with another person to cut and.remove the timber from his land for sale or commercial purposes, the owner must pay the severance tax; for such contractor and his servants who- actually sever the timber act for the owner in the.premises, and their act of severing the timber is the act .of the owner.

The result of our views is that the decree of the chancery court was correct, and will be affirmed.. .

Wood, J., dissents.


author: McCulloch, C. J.

text:
    Muller v. Planters' Bank & Trust Company.
    Opinion delivered October 12, 1925.
    Banks and banking — liability op directors. — While bank directors are liable, to stockholders as well as creditors, for failure -to exercise diligence -and good fai-th in managing the affairs of the bank, the mere exercise of poor judgment is- not sufficient to form a basis of liability. -
    Appeal from St. Francis Chancery Court; A. L. Hut-chins, Chancellor;
    affirmed.

      F. F. Harrelson, 8. 8. Hargraves and J. M. Preiwett, for appellant. • ■ .

      R. J. Williams, G. W, Norton and Mann & Mann, for appellee.
   McCulloch, C. J.

.This is an.-action instituted in the chancery court of -St. Francis County by appellants, who were stockholders of the Planters’ Bank, a defunct corporation, organized and doing business at Forrest City, against the -directors of the bank to r.ecov-er. on account of alleged negligence in the operation of the .affairs of the hank.

The Planters’ Bank & Trust Company, a banking corporation at Forrest City, which took over the assets of the Planters’ Bank and assumed its liabilities to depositors, was joined .as defendant, and recovery against that institution was sought by appellants on the ground alleged in the complaint that the consent of the stockholders to the transfer of the assets of the Planters’ Bank was induced by false and fraudulent representations of the directors of the old bank, who also became directors of the new bank, concerning the value cf those assets and the financial condition cf the old bank. There are certain other allegations of fraud and misconduct, but in the presentation of the case here the .only relief sought is against the directors of the Planters’ Bank for alleged negligence in managing the affairs cf the bank.

The Planters ’ Bank was organized in the year 1910 with Henry P. Gorman, an experienced banker, as cashier. He died in the year 1918, and was succeeded by a young man who had been his assistant for five or six years prior to that time. The affairs of the bank wiere in a prosperous condition until the summer of 1920, when it was discovered that the affairs were in a doubtful condition on account of insufficient securities from borrowers. The bank experienced difficulty in keeping up its cash reserve, and from -time to time some of the directors borrowed money on their own private securities and placed it in the bank in order to restore the cash reserve.

On May '2, 1921, a meeting of the stockholders was held, at which a resolution was adopted with substantial uuanimity by which .the directors of the 'bank were authorized to liquidate the affairs of the bank by transferring all of its assets to a new barking institution then organized under the name of the Planters ’ Bank & Trust Company, that institution assuming all of the liabilities to the depositors of the old bank. The resolution adopted specified in detail the terms of the deal to be consummated with the Planters’ Bank & Trust Company, and that arrangement was carried out by the directors in accordance with the resolution.

The Planters’ Bank & Trust Company assumed the liabilities to the depositors of the old bank, and the directors of the old bank conveyed to it the banking house and fixtures and the bulk of' the bills receivable and securities of the face value of $219,468.39. These assets were taken by the new bank at face value,, but the sum of such value being about $14,000 less than the assumed liabilities, the Planters’ Bank & Trust Company agreed to, and did, advance that sum upon the transfer to it as collateral security of the. remainder of the bills receivable and securities of the old bank -of the face value of $76,447.36. A note was executed to the Planters’ Bank & Trust Company for said sum of $14,000, and the last mentioned batch of doubtful securities were transferred to a trustee as collateral security for the note. Prior to that time two of the directors of the old hank had, in order to keep up the cash reserve, borrowed the sum of $40,000 and deposited it in the bank, not to be checked out, and the old bank was thereby indebted to those directors in that sum at the time of the liquidation. That debt, however, was not assumed by the new bank, but a note was executed to those two directors for the amount and the securities of the face value of $76,447.36 were held by the trustee as collateral security for said note, subject to the prior lien of the Planters’ Bank & Trust Company for the $14,000 note. The Planters’ Bank ceased to do business, and was succeeded by the new institution, the Planters ’ Bank & Trust Company, the latter institution being made up principally of stockholders of the old bank. All of the stockholders of the old bank were offered stock in the new; many of them, however, including appellants, did not take advantage of the offer.

It is alleged that the directors of the bank negligently permitted Gilliam, the cashier, to conduct the affairs of the bank recklessly and without good judgment, which caused losses to the extent that it became insolvent. It is also alleged that Gilliam used funds of the bank for his own private purposes and was short in his accounts, and that this occurred by reason of the negligence of the directors, who, it is alleged, allowed him to continue to handle the affairs of the bank after his shortage occurred, and after it was known that he had made bad loans.

The record in the case is very large, and the testimony on the only issue left in the case for our determination is voluminous. The testimony is undisputed as to the condition of the hank at the time of the liquidation of its affairs, but there is a conflict in the testimony as to the cause of the losses — whether by negligence of the cashier and the directors, or whether they occurred from depreciation in value of the securities, which occurred in the year 1920. It is undisputed that 'the bank had liquid assets in the form of secured loans of the value of $219,468.39, which were turned over to the new institution at their face value, and that the doubtful securities were of the face value of $76,447.36. It is conceded that the last mentioned lot of securities were of very doubtful value, and that there will he heavy losses on the same, but there is some conflict as to the extent of the loss. The testimony adduced by appellants singles out many i items of the securities which the testimony tended to show were bad loans — loans that were ill advised and I insufficiently secured at the time they were made. On. the contrary, the testimony adduced by appellees tended to show that, while most of these securities were of little | value at the time of the liquidation, they were good at \ the’time the loans were made, and that the losses occurred ¡ bv reason of general depreciation in property values. There is a conflict in the testimony also as to the extent of the personal attention given to the affairs of the bank bv the directors. Appellants undertook to show that the directors gave very little attention to the affairs' of the bank, and left everything: in the hands of Gilliam, the. ^ashier. Thev support this by introducing the minute book to show that the meetings of the board of directors were not regularly held, hut that long intervals occurred between these meetings. On the other hand, the directors and other witnesses introduced testified that the directors gave personal attention to the affairs of the hank, and supervised the transactions conducted by the cashier, and that the directors were not derelict in their duty. The minutes of the directors’ meetings were not conclusive as to the extent of the attention given by the directors to the business of the institution. It would serve no useful purpose to detail the various loans around which the controversy turns as to the conduct of the directors and the cause of the losses. Suffice fit to say that the finding of the chancellor that the directors gave a reasonable amount of attention to the management of the affairs of the bank and were not negligent in that respect is not against the preponderance of the evidence.

There is a conflict in the testimony as to when the directors ascertained that the cashier was short in his accounts. According to the preponderance of the evidence, this discovery was not made until some time in January, 1921, and as soon as it was made the directors placed restrictions upon the cashier which prevented him from making away with any more assets of the hank. It also shows that they were not negligent in failing to make earlier discovery of the cashier’s shortage. There is no proof to show that there were any losses, either in making loans or by speculations of the cashier, after it was ascertained that the affairs of the bank were not in a satisfactory condition. All the testimony tends to show is that the depreciation in values began in the 'midsummer of the year 1920 and progressed so rapidly that bv the autumn of that year there was a slump in values that caused heavy losses to all business enterprises, especially to banking’ institutions which held collateral from farmers and merchants.

There is nothing in the record to warrant an inference of unfairness or wilful misconduct on the part of any of the directors of the bank. The most that is warranted, we think, is that in some instances there was poor judgment exercised in making- loans. The aggregate ' amount of the loans made in these instances where pour judgment is fairly inferable is not sufficient to have caused the bank’s failure, for a greater part of the losses were shown to have occurred by depreciation in values, for which no one connected with the institution was responsible.

It is earnestly urged that the directors were at least negligent in failing to collect the shortage from the defaulting cashier. The amount of the shortage is not precisely given in the record, so far ás we observe, but it appears to be somewhere in the neighborhood of seven or eight thousand dollars. The cashier had given a bond with a surety company as security, and immediately upon discovery of the defalcation the company wlas notified. L/ater, however, a settlement was arranged whereby the cashier gave notes for the amount, signed by his relatives, and those notes appeared to be good security for the amount of the shortage. The notes, however,' were not paid, and there is a conflict in the testimony as to whether the amounts will ever be paid. The amount of the loss on this account was small in comparison with the other losses, and it had no substantial effect upon the status of the bank. If the loss in that way were restored, it would be absorbed by the liabilities of the bank which were assumed bv the directors and the additional amount still owing to the two directors who supplied the funds to keen un the cash reserve.

The law applicable to the case is well settled by decisions of this court. We have decisions declaring the statutory liability of directors of a corporation to the creditors thereof. Fletcher v. Eagle, 74 Ark. 585: O’Neil v. Eagle Generator Co., 92 Ark. 416; Bailey v. O’Neal, 92 Ark. 327; Wait v. McKee, 95 Ark. 124. There are also decisions defining the duty and liability of directors to stockholders. Bank of Des Arc v. Moody, 110 Ark. 39; Bank of Commerce v. Goolsby, 129 Ark. 416. In Bank of Commerce v. Goolsby, supra, it was said with respect to the duty of directors to stockholders as f ollows: “We have no statute expressly defining such duties and prescribing liability for failure to discharge such duties, as' in case of creditors. The statute, however, in broad terms, as we have seen, places the ‘stock, property, affairs and business of such corporations’ under the care of their board of directors, to be managed by them. The statute creates a relation and confers a power which necessarily carry with them corresponding duties and liabilities, independent of any statute specifically defining or limiting those duties and liabilities; and, in the absence of any statute, they must be ascertained and controlled by common law rules applicable generally to such relations and powers.” The court then adopted the rule announced by Mr. Justice Harlan in the case of Briggs v. Spaulding, 141 U. S. 132, as follows: “Directors cannot, in justice to those who deal with the bank, shut their eyes to what is going on around them. It is their duty to use ordinary diligence in ascertaining the condition of its business, and to exercise reasonable control and supervision over its officers. They have something more to do than, from time to time, to elect officers of the bank, and to make declarations of dividends. That which they ought, by proper diligence, to have known as to the general course of business in the bank, they may be presumed to have known, in any contest between the corporation and those who are justified by the circumstances in dealing with its officers upon the basis of that course of business. * * * A rule no less stringent should be applied as between a banking association and directors representing the interests of stockholders and depositors.” The substance, therefore, of the test laid down in that case of the responsibility of directors to stockholders as well as to creditors is good faith and diligence. The mere exercise of poor judgment is not sufficient to form a basis of liability, for when directors are selected by the stockholders the latter assume the risk of losses occurring on account of mere defects in judgment, and in acceptance of the office by the director he merely assumes the obligation to manage the affairs of the institution with diligence and good faith. Applying this test to the case in hand, we are of the opinion that the evidence is not sufficient to make out liability on the part of the directors. There is no bad faith shown, nor is there a preponderance of the evidence showing a failure to exercise ordinary care, such as business men of reasonable prudence would have exercised under the same circumstances.

Finding no error in the decree, the same is affirmed.


text:
    Wofford v. Bettis.
    Opinion delivered October 12, 1925.
    Highways — abandonment of project- — collection of expenses.— Where the affairs of a road improvement -district have progressed beyond -the preliminary stages, and expenses have been incurred for permanent as well ,as preliminary work, upon the abandonment of the improvement the expenses must be paid by a levy of taxes on the assessed benefits.
    Appeal from Poinsett Chancery Court; 8. T. Mayo, Special Chancellor;
    affirmed.

      Fred M. Pickens and Eugene Sloan, for appellant.

      Robert E. Fuhr, for appellee.
   McCulloch, C. J.

Fisher Road Improvement District in Poinsett County was created by an act of the General Assembly of 1919. Road Acts 1919, p. 1384. The preliminary work was done and expenses thereof incurred, and there was an assessment of anticipated benefits, which was duly confirmed in accordance with the- statute. It being found that the estimated cost of the improvement would not exceed the assessed benefits, contracts were made for constructing the improvement. The contractors entered upon the performance of the contract and constructed part of the improvement, but the commissioners of the district decided to abandon the work, and that was done. There were no bonds sold., but expenses were incurred for the construction of the work referred to above, as well as for the preliminary work. After the work was abandoned, claimants for these various expenses instituted suits against the district in the chancery court of Poinsett County, and that court adjusted the claims of the various claimants and rendered a decree specifying thé amount each was to recover. There was no appeal from that decree, and therefore no question is involved on the present appeal concerning the correctness of' the 'claiips or the validity of the decree allowing the same. The chancery court appointed a receiver to collect the assessments for the purpose of paying’ off these claims, and directed that an assessment be made of eleven per centum of the benefits on the respective tracts of land in the district as already assessed and approved pursuant to statute. This appeal is prosecuted by 'owners of real property in the district, and the only question involved is as to the correctness of the method of the tax, whether it should have been made upon the original assessment of benefits, or whether it should have been levied ad valorem according to the assessment for general taxation.

There are two sections of the statute creating the district reading* as follows:

“Section 20. All bonds issued by the commissioners under the terms of this act shall be secured by a lien on all lands, railroads and tramroads in the district, and the board of commissioners shall see to it that a tax is levied annually, and collected under the provisions of this bill, so long’ as it may be necessary to pay any bond issued or obligation contracted under its authority; and ■the making of said assessment or levy and collection may be enforced by mandamus. If any bond or interest coupon on any bond issued by said board is not paid within thirty days after its maturity, it shall be the duty of the chancery court of Poinsett County, on application of any holder of such bond or interest coupon so overdue, to appoint a receiver to collect the taxes aforesaid, and an assessor to reassess the benefits, if nocessary; and the proceeds of snch taxes and collections shall be .applied, after payment of costs, first to overdue interest, and then to payment pro rata of all ¡bonds issued by the said board which are then due and payable; and the said receiver may be directed by suit to foreclose the lien of said taxes on said lands; and the suits so brought by the said receiver shall be conducted in all matters as suits by the board as hereinbefore provided, and with like effect; and the decrees and deeds therein shall have the same presumptions in their favor; provided, however, that, when all such sums have been paid, the receiver shall be discharged and the affairs of the district conducted by the board of commissioners as hereinbefore provided. ”
“■Section 24. In case, for any reason, the improvement contemplated by this district is not made, the preliminary expenses shall be first lien upon all the property in the district and shall be paid by a levy of a tax upon the assessed value for county and State taxation, which levy shall be made by the chancery court of Poinsett County and shall be collected by the receiver to be appointed by said court,”

Appellants contend that the expenses incurred should be paid by levy of taxes in accordance with section 24, and they rely, in support of that contention, on the decisions of this court in Netterer v. Dickinson, 153 Ark. 5, and Western Crawford Road Imp. Dist. v. Missouri Pacific R. Co., 157 Ark. 304. The distinction between the present case and the two cases relied on by counsel for appellants is that in both of those cases the payment of preliminary expenses was involved, whereas in the present case the expenses were for both preliminary work and permanent construction work. In those cases the • operations of the respective districts did not progress beyond the preliminary stages, and the question of the ■ method of raising- funds to pay preliminary expenses fell soua rely within the sections of the statute which were similar to section 24 of the present statute. The distinction between the cases is a very important one and-brings about a different result so far as concerns the method of raising funds to pay incurred obligations.

The orderly .scheme adopted in the statute creating this district, which is similar to nearly all of the other recent statutes on that subject, provides for preliminary work in order to ascertain whether or not the construction of the improvement can be undertaken. This includes engineering work to determine the feasibility and the probable cost of the improvement, and the assessment of benefits to determine whether or not the estimated cost will exceed the benefits. The adoption of plans and the assessment of benefits mark the- distinction between preliminary and permanent work. If at this point it is determined that the work cannot be done, no further steps can be taken except to pay the expenses incurred in preliminary work, and § 24 is the statutory method of raising funds to pay those expenses. If, however, it is ascertained at this point in the proceedings that the work of constructing the improvement may proceed, the preliminary expenses are merged into the general cost of the improvement, and the method prescribed in § 24 has no further effect. In other words, when the progress of the district gets beyond the preliminary stages, the only taxes that can be levied are those based on benefits. It is unnecessary to determine whether § 20 has any application, except as a remedy for holders of bonds, for, when liability has been incurred for permanent work and is properly established, the only remedy under general principles would be the apportionment of these expenses in accordance with the anticipated benefits, there being no other statutory provision applicable. Nor is it necessary to determine whether a receivership was proper, because that question is not involved on the present appeal. The expenses have been apportioned by the court in accordance with estimated benefits, and the only question presented now is whether or not this amoortionment is made according to the proper’method. We are of the opinion, as before stated, that where the affairs of the improvement distri-ct have progressed beyond preliminary stages and expenses have been incurred for permanent as well as for preliminary work, those expenses must be p-aid by levy of taxes on assessed benefits, whether the improvement has been completed or not.

Decree affirmed.


author: [Wood, J.

text:
    Lone Rock Bank v. Pipkin.
    Opinion delivered October 12, 1925.
    1. Vendor and purchaser — reliance on representations of vendor’s agent. — A purchaser has no right to- rely upon representations of the vendor’s agent as to the price which the vendor had put upon the land, when the property is open to observation, and he has viewed the same, and must rely upon his own judgment to determine whether the property is of the value represented and whether he is willing to pay that price.
    2. Fraud — opportunity of information.- — If the means of information as to the subject of a representation is equally accessible to both parties, they will be presumed to have informed themselves; and, if they have not done so-, they m-us’t abide the -consequence of their own carelessness.
    3. Vendor and- purchaser — contract of purchase — marketable title. — A contract for the purchase of land which calls'for a title to be pronounced good by the- purchaser’s attorney contemplates a marketable title, and the purchaser would -not ibe bound if the title was not marketable, even though his attorney examined the abstract of title and pronounced it good.
    4. Vendor and purchaser — contract of purchase — burden of proof. — A purchaser of land resisting specific performance of his contract upon the ground that the title is defective has the burden of proving the specific defects complained of.
    Appeal from Randolph Chancery 'Court; Lyman F. Reeder, Chancellor;
    reversed.

      Schoonover ■& Jackson, for appellant.

      George G. Dent, for appellee.
   [Wood, J.

This action was instituted by the Lone Rock Bank, hereafter called Bank, against E. H. Pipkin and wife to foreclose a mortgage executed by Pipkin and wife to Decker & Reed on 225 acres of land in Randolph County, Arkansas. It was alleged that Decker & Reed transferred the notes for value before maturity to the bank. Decker & Reed were made parties defendant. It was alleged that there was a misdescription of the land in the mortgage. The bank prayed judgment against the defendants- and for a reformation of the mortgage and a foreclosure of the same to- ¡satisfy the judgment. Decker & Reed did not answer. Pipkin and wife answered denying the material allegations of the complaint, and set up by way of cross-complaint that Decker & Reed had the land for sale as the agent of one Charles Sellers, and that they fraudulently represented that Sellers had fixed the price of the land at the sum of $3,000, whereas Sellers had fixed the price to them at $2,500; that Decker & Reed further fraudulently represented -that the title to the lands was perfect, and that, relying upon these representations, they purchased the land for $3,000 and deposited in escrow the sum of $700, which was to be paid to the bank if perfect title to the lands as shown by the abstract was furnished; if not, the deposit was to be withdrawn. They alleged that it was understood 'between Pipkin and wife and Decker & Reed that there was -to be a perfect title to the land, free from any and all incumbrances, and that before the deal was to be consummated the title was to be perfected according to the opinion of E. G-. Schoonover, an attorney employed by them -to- examine and pass upon the title; that they purchased the land i-n reliance upon the representations made by Decker & Reed as to the price and title, and that such representations were false. They tendered a deed to Decker & Reed, conveying to them title to the lands which Decker & Reed refused. Pipkin and wife prayed in their cross-complaint that the sale be set aside for fraud and misrepresentation and concealment; that the purchase money notes executed by them for the land be returned to them, and that they have judgment against Decker & Reed for $700, which was paid to them by the bank.

Decker & Reed did not answer the cross-complaint, but a stipulation was filed to the effect that it should be considered by the court that they had answered denying all the material allegations prejudicial to their interests. It was also stipulated by the parties that the complaint should be treated as amended so as to ask for judgment on the purchase money note that had matured since the filing of the original action, and that, in case of a decree in favor of the bank, the amount of such decree would be for the unpaid notes and for a foreclosure of the mortgage. It was also stipulated that all material allegations of the cross-complaint were denied by the bank.

It will be observed from the pleadings that the Pipkins are resisting the bank’s action for judgment and foreclosure mainly on two grounds: First, that fraud was practiced upon them by Reed of Decker & Reed, in that he represented that the Sellers farm had been listed with Decker & Reed by 'Sellers, the owner, to be sold for the sum of $3,000; that Reed represented that Sellers wanted $3,500 for it, and that Decker & Reed had made him come down $500; that, if the Pipkins were not interested in the land at that price, it would not be worth his time and trouble to view the land; that he was acting as Sellers’ agent, and that the land had been listed with Decker & Reed by 'Sellers for that sum; that he ascertained after the contract was entered into with Reed that ■the land was listed by Sellers with Decker & Reed in the sum of $2,500; that he had no notice of such fact, but relied largely upon the representations of Reed.

We do not find in the cross-complaint of the Pipkins any allegation to the effect that the land was of less value than the sum they agreed to pay for same. Nor is there anything in Pipkin’s testimony, as abstracted, to show that the land was of less value than what he agreed to pay for same. The effect of Pipkin’s allegation and nroof to sustain the same is that Reed, as the agent of Sellers, had sold him the land for $3,000 by falsely representing that that was the lowest price placed on the land by Sellers, whereas the truth was that Sellers had sold the land to Decker & Reed for about $1800. Pip-kin had no right to rely upon these false representations of Reed as to the price which the owner and seller had put upon the lands. A purchaser has no right to rely upon such representations of an agent when the property is open to observation, and especially after he has viewed the same and in the last analysis must rely upon his own .judgment to determine whether the property is of the value represented, and whether he is willing to pay that price. The purchaser, under such circumstances, cannot claim that he was misled and relied upon the false representation as to the price and was induced thereby to make the purchase. Since Pipkin had an opportunity to view and did view the land before his purchase, and since he does not claim that he was in any manner deceived by Reed as to the nature and character of the land and the true value thereof and does not pretend in his pleadings or proof that the land was of less value than the sum he paid, he is in no attitude to set up that he was induced by the fraudulent representations of Reed concerning the owner’s price to enter into the contract of purchase. He is in no attitude to claim that he was injured by such false representations because he was dealing with Reed at arms’ length and had to act entirely on his own judgment in determining whether he was willing to pay the price named by Reed in making the purchase. The means of information as to the value of the land was as accessible to Pipkin as it was to Reed. The facts of this record bring the ease well within the doctrine of the many cases of this court to the effect that, “if the means of information are equally accessible to both parties, they will be presumed to have informed themselves, and, if they have not done so, they -must abide by consequences of their own carelessness.” Delaney v. Jackson, 95 Ark. 131 and cases there cited. In the case of Darnell v. Bibb, 143 Ark. 580, at page 592, we quoted the following from Cardwell v. Dennis, 101 Ark. 608, which is exceedingly apposite here: “A misrepresentation, in order to affect the validity of a contract, must relate to some matter of inducement to the making of the contract, in which, from the relative position of the parties and their means of information, the one must necessarily be presumed to contract upon the faith and trust which he reposes in the representations of the subject of the contract. For, if the means of information are alike accessible to both, so that' with ordinary prudence and diligence the parties might respectively rely upon their own judgment, they must be presumed to have done so. Or, if they have not so informed themselves, must abide by the consequences of their own inattention and carelessness.”

The appellees further contend that under their contract for the purchase of the land, before the deal was fully consummated and the lands paid for, the title to such lands was to be either perfect or perfected according to the opinion of E. Gr. Schoonover, an attorney at law employed by them to examine and pass upon the title to the same. The contract under which the Pip-kins purchased, among other things, provided that “when Decker & Reed gets the abstract and deed, and turns over to the Lone Rock Bank, then the Lone Rock Bank is to turn over the money, which is $700, and the land notes, to Decker & Reed. It is also understood that the Lone Rock Bank is to have the abstract examined, and, when passed as good by attorney Schoonover, then the $700 and land notes is to be turned over to Docker & Reed and E. H. Pipkin is to pay the attorney’s fee.”

Pipkin testified that the title was not perfected in accordance with the attorney’s opinion; that the opinion of the attorney pointed out certain defects which had never been corrected. It appears that the bank, through its cashier, Duvall, had the abstract examined by attorney Schoonover and he writes concernina’ it, among other things, as follows: “I have gone through this title carefully, and, while there seems to be some irregularities. I don’t regard them as being serious pnous'h to affect the marketability of the title. In my judgment. the fee title to the 225 acres of land is vested in L. P. Reed, subject to the deed of trust held ¡by the Perkins.”

It is recited in the contract for the purchase mentioned above as follows: “Now it is understood that E. EL Pipkin is to assume an $1100 loan now on the farm, and it is also understood that Decker & Reed is to get E. EL Pipkin an abstract and a warranty deed showing the land to be clear except for the $1100 loan, etc.” Attorney Schoonover, in his letter to. Duvall, after stating that in his judgment the title was in Reed subject to the deed of trust held by the Perkins, further suggested what the irregularities were to which he referred as not being serious enough to affect the marketability of the title, and in his testimony, after reciting what had been done to correct these irregularities, he testifies, “In my judgment this abstract of title meets the requirements of this contract, and what I said in my letter in regard to- the matter just suggests that certain things might be done.” And he further testifies that, according to the written contract between the Pip-kins and Decker & Reed, the abstract shows the land to be clear except for the $1100 loan against it.

We deem it unnecessary to set out and discuss in detail the testimony of 'Schoonover and others -showing’ the steps that were taken to conform to the suggestions of Schoonover in his letter to Duvall concerning the title. Suffice it to say, we are convinced that a decided preponderance of the testimony .shows that the contract of appellees with Decker & Reed -did not call for a perfect paper or record title, but did call for a marketable title -and one that the attorney Schoonover should pronounce good upon an examination of the abstract. The •contract was fully complied with on the part of Decker & Reed, for they furnished an abstract that was pronounced good by Schoonover, and the testimony, beyond question, shows that the title of Sellers which was conveyed to the -appellees was a good and indefeasible and marketable title. The case, in essential particulars, is not unlike the case of Hinton v. Martin, 151 Ark. 343, 356, where we said: “We- think the contract under review did not call for -a title shown -to he perfect by an abstract, but that -it did call for a marketable title, '* * * and the purchaser will therefore be required to accept the title under his -contract. ’ ’ The $1100 loan mentioned in the contract was an incumbrance for that amount with interest thereon in favor of one Perkins which Pipkin assumed, and he is not in an attitude to complain that this $1100, with interest and charges on same amounting to $220, was an outstanding incumbrance on the property. Pipkin was advised in the contract that this loan was outstanding, and the mention of the loan necessarily carried with it and put him on inquiry as to the nature of the incumbrance or incumbrances on the land which were executed to secure the loan. To be sure, if the evidence proved that Pipkin had not received a marketable title, he would not be bound by his contract, even though his attorney Schoonover examined the abstract and pronounced it good. See Leroy v. Harwood, 119 Ark. 418. But here the record shows that the appellees took a title that was not only marketable, but was als-o- pronounced good by their attorney as the contract specified. The proof show:s that the- appellees are in possession of the lands under their title. ' No one, so far as this record discloses, has challenged their title or right to possession. Appellees seek by -their -cross-complaint to have-their contract of purchase annulled, their deed cancelled, and their -outstanding notes for- the purchase money returned, etc. The burden of proof was upon them to point -out in their pleadings, and proof the specified defects in their title which would entitle them to the relief sought. Bolton v. Branch, 22 Ark. 435; Benjamin v. Hobbs, 31 Ark. 151. This they have not done. Appellees in their cross-complaint only make a general allegation that “Decker & Reed fraudulently represented to the said Eugene H. Pipkin that the title to said land was perfect,” and in their proof they have n-ot shown wherein the title was not perfect.

The decree of the trial court grautiug the appellees the relief for which they prayed is therefore reversed, and’ the cause will be remanded with directions to enter a decree in favor of the bank against the appellees and also against Decker & Reed as the indorsers of the notes of the appellees for the amount of such notes, and also for a reformation and foreclosure of the mortgage according- to the prayer of the complaint, and for such other proceedings as may be necessary to conserve the rights of the parties and not inconsistent with this opinion.


author: Wood, J.

text:
    Yelvington v. State.
    Opinion delivered October 12, 1925.
    1. Indictment and information — ground for quashing. — An indictment will not be quashed because the judge entered the grand jury room and charged the grand jury secretly.
    2. Continuance — absent witnesses. — A continuance for two witnesses absent from the State wa-s properly refused where the location of one was unknown, and it does not appear that a postponement to another day of the term would not have been sufficient to procure the other’s deposition.
    3 Criminal law — invited error. — Erroneous testimony elicited by defendant’s counsel cannot be complained of .by defendant, being invited.
    4. Criminal law — argument—harmless error. — In a prosecution for larceny, a remark of the prosecuting attorney in argument that the defendant failed to' testify in a civil case brought against him by the prosecuting witness to recover the property alleged to have been stolen by him was not prejudicial where the evidence as to the testimony in the civil case was brought out by the defendant, and the court instructed the jury that they were to determine the criminal case toy the evidence in that case, and not by the verdict in the civil case.
    Appeal from Monroe Circuit Court; George W. Clark, Judge;
    affirmed.

      Bogle & Sharp, for appellant.

      II. W. Applegate, Attornej1" General, and Darden Moose, Assistant, for appellee.
   Wood, J.

The appellant was charged in,- one indictment on two separate counts for the crimes of grand larceny and receiving stolen property. He was tried on both counits and convicted of the crime of grand larceny and sentenced by judgment of the court to imprisonment in the State penitentiary for a period of one year, from which he prosecutes this appeal.

The testimony for the State tended to prove that Will Breeding lost two hogs that were raised around Ms home. The hogs were found on October 24, 1924, in Monroe County fastened up in J. A. (Mann) Yelvington’'S barn. J. A. (Mann) Yelvington was a cousin of the appellant, with whom the appellant lived at the time Breeding lost his hogs. The appellant defended on the ground that the hogs were Ms property, having 'been purchased by him from Ms cousin J. A. (Mann) Yelvington. Mann Yelvington testified that he purchased the hogs from J. W. Brown, and that he sold the hogs to appellant.

The appellant moved to quash the indictment on the ground that the presiding judge, without authority of law,-went into the grand jury room and gave instructions to the grand jury in secret. The motion was overruled, and the appellant makes this ruling of the court OD<e of the grounds of Ms motion for a new trial. The motion does not present any of the statutory grounds for ¡setting aside the indictment. See § 3057, C. & M. Digest. The motion to quash merely states that the presiding judge entered the grand jury room and gave the grand jury instructions in secret. The motion does not allege what instructions were given to the jury. The mere entering of the grand jury room and instructing the jury about the matter pending before them is not declared by the statute to be a ground for setting aside an indictment. There is no statute prohibiting the trial judge from entering the grand jury room and giving instructions to the jury. The deliberations of the grand jury are secret, and the statute provides that “the grand jury may, at all reasonable times, ask the advice of the court or the prosecuting attorney.” Section 2995, C. & M. Digest. Therefore, even if the court entered the grand jury room and gave the jury instructions, -it' would not invalidate the indictment. It is not alleged that the trial judge entered the grand jury room and remained therein while the jury were examining the charge or deliberating or voting thereon. Section 2996, C. & M. Digest. Taking the allegations of the motion as true, what the court did, at most, was to charg’e the grand jury secretly, but even this is not a ground .for quashing the indictment.

In Spear v. State, 130 Ark. 457, we said:- “Errors committed ¡by the trial court in instructing grand juries do not constitute grounds for quashing indictments returned by them.” And in Bethel v. State, 162 Ark. 76-82, we said: ‘ ‘ There can be no review of alleged errors of a court in its charge to the grand jury preceding the finding of an indictment.” In State v. Fox, 122 Ark. 197-200, we held that the proceedings of a grand jury could not be examined and reviewed upon ¡a motion to quash the same except for causes specified in the statute.

The appellant moved to continue the cause on account of the absence of one P. "W-. Brown and Mrs.’ A. T. Lynch. He alleged that Brown lived at Malden, Missouri, and that appellant had 'been unable to go to Malden to take Brown’s deposition; that, if the cause were continued for the term, he would be able to have his deposition at the next term of the court; that he had not had sufficient time to take his deposition since the indictment was returned, for the reason that the time had been short, and the attorneys for the State had been busy in court looking after other cases. Appellant further states that he “has been unable to locate Mrs. Lynch since his indictment, but that, if this cause is continued until the next term of the court, he would be able to locate her and take her deposition.” And further alleged that these witnesses were not absent from the State on account of any connivance or conspiracy on his part. The appellant alleged what he proposed to prove by the testimony of these witnesses and stated that he could not prove the same facts by any other witness.

The court did not err in overruling the motion f or a continuance. • It was not alleged that Mrs. Lynch was within the jurisdiction of the court, nor were any facts alleged to show that the appellant could certainly take her testimony or have her present in person at the next term of the court. The appellant could not locate this witness. The appellant stated that Brown was at Malden, Missouri, and that he bad not had sufficient time to take his deposition, but that, if the cause were continued for the term, he would be able to have Brown’s deposition at the next term. The purported testimony of these witnesses was material, but the facts, alleged by the appellant were not sufficient to entitle him to a continuance. The appellant did not ask -that the cause be postponed to a later day in the term in order to enable him to have Brown, present or to take his deposition. He does not allege facts to show that it was necessary to continue the cause in order to procure the testimony of the witness Brown, and, for aught that the record shows to the contrary, if the appellant had requested a postponement of the cause to a later day in the term when he might have had the witness or his testimony before the court, the court may have granted such postponement. The facts alleged do not show any abuse of the court’s discretion in overruling the appellant’s motion for a continuance. See McDonnell v. State, 160 Ark. 185-189; Wood v. State, 159 Ark. 671.

We find no error in the rulings of the trial court in admitting the testimony of witnesses to the effect that Breeding had brought a suit in replevin to obtain possession of the hogs. This testimony was brought out by counsel for the appellant, and, if error, was invited error. Smith v. State, 153 Ark. 645; Tarkington v. State, 154 Ark. 365; Bourland v. State, 141 Ark. 281; Harper v. State, 151 Ark. 342.

The court, among other instructions, told the jury that they were not concerned as to how the jury may have decided the rights of the parties as to the possession of the property in the civil action; that they were to determine 'the guilt or innocence of the ¡appellant by the evidence introduced at this trial, and not by the verdict of the jury in the civil proceedings. This instruction was sufficient to remove ¡any possible prejudice that may have been lodged in the minds of the jury by any testimony or any remarks of the prosecuting attorney concerning the civil action. The record discloses the following: The prosecuting attorney argued further as follows: “This defendant failed to take the witness stand in his own case, gentlemen of the jury, when a man was asking for his property to be returned to him by an honest jury. ’ ’ Mr. Bogle: “We ask-the court to exclude that.” Court: “That is competent argument.” “We desire to save our exceptions to that argument.” “The defendant is a brother to Buford Yelvington, a brother to Millard Yelvington and a cousin to Mann Yelvington.” Mr. Bogle: I object to that. Mr. Waggoner, resuming his argument, “I don’t want you to try him on Mann’s reputation; if you did, you would electrocute him. ’ ’

We agree with the trial court that, in view of the evidence that had been elicited at the instance of the appellant, there was no prejudicial error in the remarks of the prosecuting attorney concerning the appellant’s failure to testify in the civil action. But, if mistaken in this, the court’s instruction, as already stated, removed any possible prejudice that might have -been ¡created in the minds ¡of the jury. The appellant did not object and save his exceptions to the remarks ¡of the prosecuting attorney concerning the reputation of Mann Yelvington as follows: “I don’t want you to try him on Manm’s reputation; if you did, you would electrocute him.” Therefore, since these remarks of the prosecuting attorney were not challenged at the trial, thev cannot be challenged here for the first time, and we make no ruling concerning them.

The record presents no reversible error, and the judgment is therefore affirmed.


author: Hart, J.

text:
    Cochran v. State.
    Opinion delivered October 12, 1925.
    1. Receiving stolen goods — sufficiency of indictment. — An indictment for receiving stolen goods which fails to allege that the goods were received by the defendant “with the intent to deprive the -true owner thereof,” -as required by Crawford & Moses’ Digest, § 2493, is fatally defective.
    2. Criminal law — amendment of record.- — The circuit court has the power to .amend its record in a criminal case even after an -appeal to the Supreme Court has been perfected; but such correction -of the former court’s record cannot be m-ade in the Supreme Court.
    Appeal from Faulkner Circuit Court; George W. Clark, Judge;
    reversed.

      J. G. & Wm. J. Clark, for appellant.

      E. W. Applegate, Attorney General, and Darden Moose, Assistant, for appellee.
   Hart, J.

George Coohran prosecutes this appeal to reverse a judgment of -conviction against him for the crime of receiving stolen property.

His sole reliance for a reversal of the judgment is that the circuit court erred in not sustaining a demurrer to the indictment. The indictment was returned under § 2493 of Crawford & Moses’ Digest, which reads as follow's:

“Whoever shall receive or buy any stolen goods, money -or chattels, knowing them to be -stolen, with intent to deprive the true owner thereof, -shall, upon conviction, be punished as is, or may be, by law prescribed for the larceny of such goods or chattels in cases of larceny.” ■

The indictment, as it is copied in the transcript, fails to contain an allegation that the goods were received by the defendant with the intent to deprive the true owner thereof. This court has held that an indictment under this section of the statute must allege that the property was received with the intent to deprive the true owner thereof. State v. Bills, 118 Ark. 44; see also Kent v. State, 143 Ark. 439.

It is conceded by the Attorney General that, if the present record is to stand, tbe court erred in overruling the demurrer of tbe defendant to the indictment, and that the judgment ¡must be reversed, under the authority of the oases above cited.

But an attempt has been made by certorari to correct the indictment and to show that as originally drawn it contained an allegation that the defendant received the stolen goods with the intent to deprive the true owner thereof, and that by some means this was omitted from the indictment when it was copied into the transcript. Certain evidence was taken before the circuit court and presented to uis upon which we are asked to correct the record in this court and to supply the omission-in the indictment. This we cannot do. Undoubtedly there is authority somewhere for restoring papers which have been improperly .altered and for the substitution of new ones where the originals have been lost. Under our statute this authority is vested in the court in which the case is pending at the time the original paper shall be lost or destroyed. Crawford & Moses’ Digest, § 8344.

This court has held that our statute relating to the restoration of lost records does not take away the inherent power of courts of general jurisdiction to restore its lost’ records. Ft. Smith Automobile & Supply Co. v. Nedry, 100 Ark. 485. Thus we see that the circuit court exercised a continuing jurisdiction in the premises, even after the appeal was perfected in this case, and had the power to amend its record to make it conform to the facts in the case. If the words claimed to have been- omitted from the indictment were in the original, the only remedy * is by application to the circuit court.

No order amending the indictment b}r the circuit court appears in the record, and this court is compelled to treat the attempted substitution as a nullity. Craig v. Horine, 1 Bibb (Ky.), p. 8; Gentry v. Hutchcraft, 7 T. B. Monroe (Ky.) 241, 18 Am. Dec. 172; Frink v. Frink, 43 N. H. 508, 82 Am. Dec. 172; and Galbraith v. McFarland, (Tenn.) 91 Am. Dec. 281.

If the State -desired to have -a ruling of the circuit court irw the premises, it should have specifically asked a ruling on the question, and then, if the court had refused to hear 'and determine the matter, it could -by 'appropriate process have compelled the circuit court to act in the premises.

The result of our views is that the circuit court erred in overruling the demurrer to the indictment, and for that error the judgment must he reversed, and the cause will be remanded for further proceedings according to law and not inconsistent with this opinion.


text:
    Dennis v. State.
    Opinion delivered October 12, 1925.
    1. Larceny — sufficiency of evidence. — Evidence held sufficient to warrant the jury in returning a verdict of guilty.
    2. Larceny — possession of stolen property. — 'The possession of property recently stolen justifies the inference that the possession is a guilty o-ne, and may be of controlling weight unless explained by circumstances or accounted for in some way consistent with innocence.
    3. Criminal law — secondary evidence. — Where a check given in payment for stolen property was admissible in evidence, upon proof of its loss, it was not err-o-r to allow the stub of the check to be introduced in evidence.
    4. Criminal law — competency of evidence. — Generally, evidence is competent, though not of itself sufficient to establish a fact, if it is such that the jury may, in connection with other relevant facts, support a finding upon some issue material to this cause.
    5. Criminal law — competency of evidence. — It was competent, in a prosecution for larceny, to show that defendant had sold a box of tobacco alleged -to have been stolen, from which the name of the owner had been erased.
    6. Criminal law — -incriminating admissions. — Where defendant, when arrested, stated to the officers that a-t the time the alleged larceny was committed he was near a distant city, hut at the , trial he testified that he w!as elsewhere, his prior statement was admissible to contradict him and as an admission tending to show guilt.

      Appeal from Washington Circuit Court; W. A. Dickson, Judge;
    affirmed.

      H. W. Applegate, Attorney General, and Darden Moose, Assistant, for appellee.
   Hart, J.

Walter Dennis prosecutes this appeal to reverse a judgment of conviction against him for the crime of grand larceny.

The first assignment of error is that the evidence is not legally sufficient to support the verdict.

According to the testimony of the witnesses for the State, the storehouse of Elmer Carter at Durham, Washington County, Arkansas, was broken into in the nighttime somewhere near the 16.tk day of July, 1924, and between sixty and seventy-five dollars’ worth of tobacco and a sack of sugar were taken therefrom. In a day or two afterwards, Carter received information' that his tobacco was in a storehouse at Tahlequah, Oklahoma. He immediately went there and identified a quantity of tobacco in the storehouse of C. C. Estepp as being the tobacco which had been stolen from his store. Carter had been in partnership with his brother-in-law under the firm name of Carter & Anderson. He bought his brother-in-law’s interest in the store and .continued to run it in the name of Carter & Anderson. The tobacco in question was shipped to him in the name of “Carter & Anderson, Durham, Ark.,” and these words were marked on the tobacco boxes. The tobacco boxes found in the store of C. C. Estepp were plainly marked with the words, “■& Anderson, Durham, Ark.,” and the word “Carter” had been partially rubbed off or scratched out. C. C. Estepp bought the tobacco from W. D. Dennis, and gave him a check for $29.91 in payment of it. This was something like one-half of the invoiced value of the tobacco. A short time after Estepp bought the tobacco, he told the chief of police of Tahlequah about having purchased it and the price he paid for it. The chief of police examined the tobacco box, and, when he found that the word “Carter” had been marked or scratched off, he asked Estepp for and obtained this piece of wood. The chief of police wrote to the sheriff of Washington County to find out if a store had been burglarized there, and, after he found out that it had been, he turned over this piece of plank or wood to the sheriff of Washington County, Ark. He also turned over to him. the check which Estepp had given the defendant in payment of the tobacco, and this check bore the indorsement, “W. D. Dennis.” This cheek was given the chief of police by Estepp.

Another witness testified that he had examined the cheek in question and recognized the indorsement as the handwriting of W. D. Dennis.

The defendant relied upon the defense of an alibi, and introduced evidence tending to establish it.

The evidence for the State, if believed by the jury, was sufficient to warrant it in returning a verdict of guilty. Possession of property recently stolen justifies the inference that the possession is a guilty possession, and may be of controlling weight, unless explained by circumstances or accounted for in some way consistent with innocence. We have repeatedly held that the recent possession of stolen property by the defendant unexplained, when taken in connection with other circumstances similar to those proved in this case, is sufficient to warrant a verdict of guilty. Indeed, the recent possession of stolen property by the accused, unexplained, warrants the jury in returning -a verdict of guilty. McDonald v. State, 165 Ark. 411, and cases cited.

The third assignment of error is that the court erred in permitting the State to read in evidence the stub of the check which was claimed to have been given bv O. C. Estepp to the defendant in payment of the tobacco.

The record shows that Estepp gave to Dennis a ^bfidc for $29.91 for some tobacco purchased bv him from the defendant, and that this tobacco was identified by, Elmer Carter as the tobacco which is charged to have been; stolen from him. Estepp turned this check over to the chief of police at Tahlequah, Oklahoma, and he in turn, turned the check over to the sheriff of Washington County. It was placed among the papers in the grand jury room, hut in some unaccountable way it became lost. Upon proof of these facts the court allowed the stub of the check, which was identified as such, to be introduced as evidence in¡ the case.

Under the circumstances there was no error in permitting the stub to be introduced as secondary evidence of the check which had been, shown to be lost. If the check had not been lost, it would have been admissible in evidence. The general rule is that evidence is competent and admissible, though it may not be such as of itself to establish a fact, if it is such that the jury may, in connection with it and other relevant facts, make a finding respecting some issue material to the cause. Carter 'had identified the tobacco for which the check Was given in payment as the tobacco which had been recently stolen from him when his store was burglarized. H,ence its relevancy is apparent.

Then, upon the same principle of law, there was no error in allowing the State to introduce the plank on which appeared the words “& Anderson, Durham, Ark.,” and which showed that the word “Carter,” appearing before these Words, had been nearly scratched off. Under the circumstances, this attempted mutilation of the plank might be construed by the jury as an attempt on the part of the defendant, who had possession of the tobacco, to keep it from being traced as the tobacco which had been taken from the store of Elmer Carter when it was burglarized.

Other assignments of error are based upon the court allowing the -State to prove by the sheriff that the defendant had stated to him when arrested that he had been in Ft. Smith, Arkansas, on the night the robbery was charged to have been committed.

On this point the record shows that the defendant was arrested in Madison County -in July, 1924, by the sheriff of that county, and the defendant was told by him that, if he could prove his whereabouts on the night the store was burglarized, he could prove his innocence. The defendant replied that he was visiting his mother over-close to Ft. Smith on that night. This ¡answer was voluntarily given by the defendant. On the trial of the case, he relied upon the defense of 'an alibi, and several witnesses including himself testified that he was at the home of his brother-in-law on the night in question, and that his brother-in-law lived in Washington County, quite a distance from Ft. Smith.

Under the present state of the record there can be no doubt that the statement made by the defendant to the sheriff that he was in Ft. Smith on the night of the alleged burglary was false. If it was intentionally false, it tended to show the guilt of the defendant because it was in the nature of an admission of guilt. Of course, it was not necessary in 'order to render the evidence admissible that it should be sufficient to establish the guilt of the defendant. Its weight was for the jury, and it is sufficient that it tended to establish a material issue in the case.

We have examined the instructions given by the court and consider them to be correct declarations of law as applicable to tbe facts.

We find no reversible error in tbe record, and the judgment will he affirmed.