text:
    Meyers v. State.
    Criminal No. 3788
    Opinion delivered May 16, 1932.

      E. L. Holloway■ and G. O. Raley, for appellant.

      Hal L. Norwood, Attorney General, and Robert F. Smith, Assistant, for appellee.
   McHaney, J.

Appellant was convicted of the crime of seduction and sentenced to three years in the penitentiary. A number of errors are assigned and urged for a reversal of tbe cause.

It is first argued that tbe court erred in overruling Ms motion for continuance on account of tbe absence of certain witnesses, but Ms motion in this regard failed to allege one of tbe necessary statutory grounds for a continuance, — that he believed the testimony of the absent witness to be true. Section 1270, Crawford & Moses’ Digest; Estes v. State, 180 Ark. 656, 22 S. W. (2d) 172; Weaver v. State, ante p. 147. It is not error for1 the trial court to deny motion for continuance where the motion fails to allege the grounds specified in the statute.

It is next argned that the evidence given by the prosecuting witness fails to establish an express promise of marriage, but that such promise was only conditional, that is, that he promised to marry her only in the event of pregnancy. An examination of the evidence of the prosecuting witness, however, especially upon the examination by the court, tends to establish the fact that there was an express promise of marriage, and that she would not have yielded to his embraces upon a mere promise to marry in the event of pregnancy. In this respect this case is similar to that of Woodard v. State, 140 Ark. 258, 215 S. W. 708. Moreover, the court submitted that question to the jury by telling them that if the promise of marriage was conditional only, such a promise would not be an express promise, and that their verdict should be not guilty. See also Bethel v. State, 180 Ark. 290, 21 S. W. (2d) 176. The jury under a proper instruction has decided this point adversely to appellant.

Complaint is next made of the admission of the testimony of the witness Lela McDonald for the State. She was permitted to testify, over appellant’s objection, that the prosecutrix showed her a letter signed with appellant’s .name and written to the prosecutrix in which he said: "We will marry soon and be happy.” This testimony was permitted after the prosecutrix had testified that she had received several letters from appellant, but that when he came to see her in September following a visit in May, at her request, so that she might inform him of her condition, he procured the letters and burned them. The purpose of this evidence was to corroborate the prosecutrix concerning the promise of marriage, and we are of the opinion that, since the letters received by her from appellant were shown to be destroyed, it was competent to prove the contents of the letters or o.ne of them by secondary evidence, even though the witness could not testify that the letter she read was actually written by appellant. She did not know his handwriting. Patrick v. State, 135 Ark. 173, 204 S. W. 852. Moreover, even though it should be held that the testimony was incompetent, it would not be prejudicial as there was other substantial evidence to corroborate the prosecutrix as' to the promise of marriage.

It is next urged that the evidence is insufficient to support the verdict and judgment against him. Under our statute the prosecuting witness must be corroborated to sustain a conviction of the crime of seduction both as to the promise of marriage and the act of intercourse. The corroboration need not be direct evidence but may be and most frequently is circumstantial in character, as from the nature of the offense would necessarily be true. Convictions have been many times sustained by this court where the corroborative evidence was merely circumstantial and slight in character, the final determination of the question being for the jury where there is some evidence of corroboration. Brooks v. State, 126 Ark. 98, 189 S. W. 669; Jackson v. State, 154 Ark. 119, 241 S. W. 862; McMaster v. State, 163 Ark. 194, 260 S. W. 45. The father of the prosecutrix testified as follows: “No, sir. Nothing more than his sister hatched out his chickens, and he brought them over there and asked us if we could raise them, and so him and Francis (the prosecutrix) could have something to start on this fall; him and Francis could have chickens to start keeping house this fall, so they could have chickens.” It was also shown that appellant “kept company” with the prosecutrix for about three years, and it was shown that she was pregnant at the time of trial and had been for a period of time back to about the time he quit going with her. There are many cases decided by this court holding such evidence sufficient to corroborate the prosecutrix as to both the promise of marriage and the illicit relation, some of the later cases being Sloan v. State, 172 Ark. 44, 287 S. W. 598; Taylor v. State, 174 Ark. 800, 297 S. W. 854; Phillips v. State, 182 Ark. 70, 30 S. W. (2d) 817.

It is next insisted that the court erred in permitting Dr. F. H. Jones to testify, after the State had rested its case, that he had made an examination of the prosecutrix, found her to be pregnant and from his examination he judged that she conceived about the middle of May preceding. There was no error in this regard. Hannah v. State, 183 Ark. 810, 38 S. W. (2d) 1090; Simmons v. State, 184 Ark. 376, 42 S. W. (2d) 549.

It is finally insisted that the court erred in giving instruction No. 4 over his objection. This instruction told the jury that'lack of chastity by the prosecutrix was a defense, but that the burden of proving same by a preponderance of the evidence was upon appellant. This instruction was not erroneous on this ground. There is a presumption of chastity, and the.burden is upon him who alleges the contrary to establish the fact by a preponderance of the evidence. Taylor v. State, supra. The court correctly told the jury in instruction 7 that if on the whole case the jury had a reasonable doubt of appellant’s guilt it would be their duty to acquit him.

We find no error, and the judgment is affirmed


source: Caselaw Access Project

author: Hart, C. J.,

license: Public Domain

text:
    Rice Growers’ Credit Corporation v. Walker.
    Opinion delivered May 2, 1932.

      M. F. Elms and W. A. Leach, for appellant.

      Ingram <& Moher, for appellee.
   Hart, C. J.,

(after stating the facts). The chancery court erred in its finding and decree. ■ The law is well settled that, where a creditor receives from his debtor the note or bill of a third person, the presumption is that he takes it by way of security. Bank of Hatfield v. Bruce, 164 Ark. 576, 262 S. W. 665; Hume v. Indiana Nat. Life Ins. Co., 155 Ark. 466, 245 S. W. 19.

The record shows that appellant had made advances to appellee with which to make a rice crop and took a mortgage on the crop to secure the payment of the indebtedness. Appellee sold the crop and delivered to appellant an instrument called a trade acceptance on McGill Brothers for $4,920.89. The acceptance appears on the face of the instrument, but the amount was not paid because, before it became due, McGill Brothers, on whom it was drawn, became insolvent. According to the evidence of appellant, the draft or trade acceptance upon McGill Brothers was not received by it as an absolute payment. The source of payment provided having proved unproductive, appellant had the same recourse upon appellee as it had in the beginning. There is no evidence that appellant intended to release appellee. The draft or trade acceptance upon McGill Brothers and their acceptance were equivalent in legal effect to the receipt by appellant of a bill or note of McGill Brothers drawn to the order of appellant.

In Akin & Company v. Peters, 45 Ark. 313, it was held that the acceptance by a creditor of the note or bill of a third party for his debtor’s debt does not discharge the debtor, unless so specially agreed by the party. In discussing the question the court said “Prima facie such an instrument is conditional, not absolute payment. It operates only as a collateral security. It does not take the place of the debt, but is placed in the hands of the creditor to make him safe. And,'in the event of the nonpayment of the security, the debtor remains liable for his own debt. If the transaction has any greater efficacy — as of course it may have by special agreement of the parties — it is for the debtor to, show it. Extinguishment of his own debt does not follow as a consequence, unless that was a part of the contract.”

It is also insisted that the draft was not presented when due and notice given of the nonpayment within the time prescribed by our Negotiable Instruments Act. The draft was accepted for payment by McGill Brothers on May 11, 1931. The manager of the Rice Growers’ ■Credit Corporation took the draft to St. Louis with him and offered to deposit it with its bank, the Intermediate Credit Bank of St. Louis, with which it did business. The bank refused to accept the draft as a deposit, but stated that they had better leave the draft with the bank for collection. This was done.

On the back of the draft we find the following indorsements — C. A. Walker, R. B. Westbrook, Rice Growers’ Credit Corporation, by R. B. Westbrook, Sec’y; Pay to the order of People’s Nat. Bank of Stuttgart, Arkansas; for collection and remittance Federal Intermediate Credit Bank of St. Louis, Mo., by Wood Netberland.

The draft was protested for nonpayment on May 13, 1931. The protest notice was mailed to C. A. Walker at Stuttgart, Arkansas, which was his postoffiee address. The postmark shows May 14, 1931.

A check must be presented for payment within a reasonable time, the question of what is a reasonable 'time depending upon the circumstances of the particular case. Federal Land Bank of St. Louis v. Goodman, 173 Ark. 489, 292 S. W. 659; George H. McFadden Brothers’ Agency v. Keesee, 179 Ark. 510, 16 S. W. (2d) 994; and Board of Directors of St. Francis Levee District v. Hagan, 180 Ark. 33, 20 S. W. (2d) 314.

The draft was presented within a reasonable time under the circumstances of this case by the bank at St. Louis with which it was left for collection. The draft was duly protested on the 13th day of May, 1931, and the postmark of the protest notice was May 14, 1931. The postoffiee address of C. A. Walker was Stuttgart, Arkansas, where the draft was protested and where the protest notice was mailed. This was' sufficient notice of dishonor under our statute. Crawford & Moses’ Digest, § 7869. . '

In the application of these well-settled principles of law, it follows that the court erred in dismissing the appellant’s complaint. Therefore the decree will be reversed, and the cause remanded for further proceedings in accordance with the principles of equity and not inconsistent with this opinion. It is so ordered.'


author: Smith,*J.

text:
    Universal Automobile Insurance Company v. Denton.
    4-2532
    Opinion delivered May 16, 1932.

      Busbee, Pu,gh Harrison and Roberts S Stubble-field, for appellants.

      McMillan & McMillan, for appellee.
   Smith,*J.

This suit ivas brought by appellee against the following defendants: Mrs. L. E. Davis, as administratrix of the estate of Louis Davis, her deceased husband; Universal Automobile Insurance Company, hereinafter referred to as the insurance company; the Standard Oil Company of Louisiana, hereinafter referred to as the oil company, Horace Thornton, and W. H. Greene.

The suit arose out of the following facts. The plaintiff was driving in a northerly direction in a truck loaded with lumber. An oil truck belonging to the oil company was being driven along the same road in a southerly direction. Horace Thornton was driving this oil truck. Following this oil truck, and traveling the same direction, was an automobile owned by W. H. Greene, and driven by Louis Davis. The insurance company had issued to Greene a policy of insurance, which will hereinafter be discussed. Denton, the plaintiff, testified that he first saw the oil truck as it came over the top of a hill which the road traversed, and that this truck bore to the right of the road as it approached him, hut that it would not have struck his car, even though Thornton had not pulled over to the right. That just before the oil truck passed him he saw the car driven by Davis come from behind the oil truck, and that he turned his car to the right as far as he could — so far, in fact, that he ran the wheels on the right side of his truck off the road. It was getting dark, and the oil truck had its light on, and was traveling at a moderate rate of speed. Just as plaintiff turned his car to the right as far as safety permitted, Davis drove his car between the trucks, and, as space was not afforded for its passage, a collision occurred between Davis’ car and plaintiff’s truck. The oil truck passed on in safety without being involved in the collision. Davis was killed as a result of the collision, and plaintiff was seriously injured. He recovered judgment against all the defendants for $2,000, and all have appealed except Greene. No contention is made that the judgment is excessive.

Liability against Davis is asserted upon the ground that he negligently and recklessly drove his car between the passing trucks, and the testimony fully sustains that contention. Two witnesses who were riding in the car with Davis testified that they first saw the oil truck when, it was a hundred or two hundred yards ahead of them, and that the oil truck was on the right-hand or west side of the center of the road, and continued on that side all the time. Davis overtook the oil truck just before it passed the plaintiff’s truck, and as he turned to the east or left side of the road the collision occurred. Davis at the time was driving' about 35 or 40 miles per hour.

Thornton testified that he was going down grade on the west or right-hand side of the hill, and met Denton coming up the grade on the east side, and that he had gone 30 or 40 feet beyond appellee’s car when the collision occurred, and that he did not know the Davis car was attempting to pass him. • *

Liability against the oil company is asserted upon the theory that Thornton, the driver of its truck, was negligent in not anticipating that Davis was trying to pass him just after the cars reached the top of the hill, and in not affording Davis space so to do hy turning farther to the right; At the place of the collision the road was slightly less than 26 feet wide, with low embankments and sloping ditches about 8 or 10 inches deep. The road was straight. Thornton first saw in his mirror the light of the Davis car when it was about 2001 yards away, and knew that it was overtaking him. Appellee says the oil company truck was traveling about 40 feet per second, which is about 27 miles per hour, and that the Davis car was traveling about 60 feet per second, which was nearly 41 miles per hour. The testimony is conflicting as to whether Davis blew his horn. Thornton testified that he did not hear it. It is appellee’s theory that when the Davis car reached the crest of the hill Thornton knew it was following him, and knew, or should have known, that Davis was about to pass him, and should have driven his car to the extreme right-hand side of the road to give sufficient space for passing.

Under these facts the jury was warranted in finding that the collision was the result of Davis’ negligence, and that appellee was not guilty of any negligence con■tributing to his injury, and the judgment against the Davis estate must therefore be affirmed.

• "We are also of the opinion that, under the facts stated, the' oil company is not liable, and that the sole cause of the collision was the negligence of Davis.

At § 121, vol. 3-4, page 194, Huddy’s 'Cyclopedia of Automobile Law, it is said: “The driver of a motor vehicle overtaking another vehicle is in duty bound to look out for the car ahead, and, if such vehicle is motor driven, he must realize that the driver is engaged in hándling a high-power, dangerous machine, requiring constant attention and quick action, and that his lookout is ahead and not behind. An automobilist has no right to assume that the forward conveyance will turn out to permit, him to pass. He cannot drive his car ahead and take the chance that the forward vehicle will move to one side in time to permit him to make a safe nassage. It is the duty of the rear driver to keep a safe distance between the vehicles, and to keep his machine well in hand, so as to avoid doing injury to the machine ahead, so long as the driver is proceeding in accordance with his rights. Before attempting to pass the vehicle ahead, the rear driver must see that the road is clear, and, if there is not sufficient room for a safe passage, or the driver ahead does not turn out so as to afford opportunity to pass, or if, after attempting to pass, the driver of the overtaking vehicle finds that he cannot make the passage in safety, the latter must slacken his speed so as to avoid the danger of a collision, even bringing his car to a stop if necessary. In passing, the overtaking car should leave reasonable space between it and the overtaken vehicle, so as to avoid any danger of striking it.”

The numerous cases cited in the note to the text quoted sustain the text.

A similar statement of the law appears in § 8, of chap. 21, entitled, “Following, Overtaking, and Passing Other Vehicles,” in vol. 1 of Blashfield’s Cyclopedia of Automobile Law, page 433.

The relative rights and duties of drivers of' cars passing each other on the highways of the State have been declared in this State by a statute on the subject.

At the 1927 session of the G-eneral Assembly of the State of Arkansas a comprehensive act was passed, entitled, “A Uniform Act Begulating the Operation of Vehicles on Highways.” Act 223, Acts 1927, page 721. Section 13 of this act reads as follows:

“13. Limitations on Privileges of Overtaking and Passing.

“ (a) The driver of a vehicle shall not drive to the left side of the center line of a highway in overtaking and passing another vehicle proceeding in the same direction unless such left side is clearly visible and is free of oncoming traffic for a sufficient distance ahead to permit such overtaking and passing to be made in safety.

“ (b) The driver of a vehicle shall not overtake and pass another vehicle proceeding in the same direction upon the crest of a grade or upon a curve in the highway where the driver’s view along the highway is obstructed within a distance of 500 feet.

“(c) The driver of a vehicle shall not overtake and pass any other vehicle proceeding in the same direction at any steam or electric railway grade crossing nor at any intersection of highways unless permitted to do so by a traffic or police officer.”

In the case of Madison-Smith Cadillac Co. v. Lloyd, 184 Ark. 542, 43 S. W. (2d) 729, it was said that the law of the road is that the automobile in front has the superior right to the use of the highway, even for the purpose of leaving it on either side to enter intersecting roads and passageways, and the traveler behind must, in handling his car, do so in recognition of the superior right of the traveler in front. See also Kittrell v. Wilkerson, 177 Ark. 1174, 9 S. W. (2d) 788; Bourland v. Caraway, 183 Ark. 848, 39 S. W. (2d) 316.

Under the law of this State, as declared in the statute quoted above, Davis should not have attempted to pass the oil company truck until he had seen that he could do so safely, and his action to the contrary, under the undisputed evidence in the record before us, must be held to be the sole proximate cause of the collision. It follows therefore that it was error not to have directed a verdict in favor of the oil company and of Thornton, the driver of its truck.

As has been said, judgment was rendered against the insurance company, which issued the policy which Greene carried, and the insurance company has appealed.

Two of the relevant paragraphs of the policy mentioned read as follows:

First: “The company does hereby agree to insure the assured named and described in the ‘Schedule of Statements’ herein, for the term therein specified, against direct loss by reason of liability imposed by law upon the assured for damages by reason of the ownership or maintenance of the automobile described in statement 6 of the ‘Schedule of Statements,’ and the use thereof for the purposes described in statement 7 of the 1 Schedule of Statements’ (including loading and unloading thereof), to an amount not exceeding the limits hereinafter stated, if such loss be sustained on account of bodily injuries or death, etc.”

Second: “It is understood and agreed that the insolvency or bankruptcy of the assured or other persons entitled to benefit hereunder shall not release the company from the payment of damages for injuries or loss occasioned during the life of the policy. In case execution against the assured or such other defendants is returned unsatisfied in an action brought by the injured (or if death results from the accident by such other parties in whom the right of action vests) an action may be maintained by the injured person (or such other parties in whom the right of action vests) against the company for the amount of the judgment of said action not exceeding the amount of the policy.”

At the 1927 session of the General Assembly an act was passed to regulate accident and liability insurance companies doing business in this State. Act 196, Acts 1927, page 667. This act reads as follows:

“Section 1. On and after the passage of this act no policy of insurance against loss or damage resulting from accident to or injury suffered by an employee or other person and for which the person insured is liable, or against loss or damage to property caused by horses or by any vehicles drawn, propelled or operated by any motive power, and for which loss or damage the person insured is liable, shall be issued or delivered to any person in this (State by any corporation authorized to do business in this State, unless there shall be contained within such policy a provision that the insolvency or bankruptcy of the person insured shall not release the insurance carrier from the payment of damages for injury sustained or loss oecasionéd during the life of such policy, and stating that in case execution against the insured is returned unsatisfied in an action brought by the injured, or his or her personal representative in ease death, results from the accident, because of such insolvency or bankruptcy, that then an action may be maintained by the injured person, or his or her personal representative, against such corporation under the terms of the policy for the amount of the judgment in the said action not exceeding the amount of the policy.

“Section 2. Whenever any policy of insurance shall be issued in this State indemnifying any person, firm or corporation against any actual money loss sustained by such person, firm or corporation for damages inflicted upon the property or person of another, such policy shall contain a provision that such injured person, or his or her personal representative, shall be subrogated to the right of the assured named in such policy, and such injured person, or his or her personal representative, whether such provision be inserted in such policy or not, may maintain a direct cause of action against the insurance company issuing such policy for the amount of the judgment rendered against such assured, not exceeding the amount of the policy.”

It thus appears that § 2 of this act writes into the policies named in § 1 the provisions of § 1, whether they are recited in the policies or not.

Section 1 of this act is copied almost literally from an act passed in New York in 1918. (Laws of 1918, chap. 182), and the constitutionality of the act was upheld by the Supreme Court of the United States in the case of Merchants’ Mutual Automobile Liability Insurance Co. v. Smart, 267 U. S. 126, 45 S. Ct. 320, 69 L. ed. 538. The New York statute has no section corresponding to § 2 of our act, set out above.

The policy issued to Greene was evidently prepared to conform to the New York statute, as well as our own, and it contains the paragraph concerning the insolvency of the assured, set out above.

It was insisted — and the court below held — that the provisions of this policy, read in conjunction with our statute, entitled plaintiff to bring an original or primary suit against both. Greene and the insurance company, and, as has been said, there- was a judgment against both.

The case of New York Indemnity Co. v. Ewen, 221 Ky. 114, 298 S. W. 182, was one in which an original suit was brought against both the insured, whose negligence was alleged to have occasioned the plaintiff’s injury, and an insurance company which had written a policy of insurance very similar to the one here sued on. It was alleged and proved in that case, as it was also in the instant case, that the insured defendant was insolvent, and it was insisted there, as it is here, that the provision in regard to insolvency, that fact being alleged, authorized the joinder of the insurance company in the suit brought to determine the liability of the insured and the extent thereof.

After a review of the authorities, it was said by the Supreme Court of Kentucky that the policy provided indemnity only against loss, and not against liability for loss, and did not authorize the joinder of the insurance company in a-direct suit and, in that connection, said: “Paragraph G” (the one relating to the insolvency of the assured) “goes on to provide that the claimant, in the event of insolvency or bankruptcy of the assured, shall have the right to maintain an action against the company for the recovery of sueh indemnity. Such indemnity, as we have seen, is the indemnity against loss from liability. This being true, we think these observations of the Supreme Court of Arizona, in the case of Smith Stage Co. v. Eckert, 21 Ariz. 28, 184 Pac. 1001, 7 A. L. R. 995, are quite apposite: ‘It also appears from what we have said that the words ‘loss and damage’ mean a real loss — one, at least so far as the indemnity company is concerned, that has been put into judgment against the assured.’ Paragraph G, in our judgment, was not intended to change the effect of the policy in any respect except to provide that, if after a judgment has been obtained against the assured and the injured party was then unable to collect that judgment by reason of the insolvency or .bankruptcy of the assured, then and only in that event the insurance company would be responsible to the injured party in a direct action. ’ ’

We concur in this view, and the following cases construing similar policies are to the same effect: Smith Stage Co. v. Eckert, 21 Ariz. 48, 184 Pac. 1001; Hanson v. Haymann, (Tex. Civ. App.), 280 S. W. 869; Bowers v. Gates, 201 Mich. 146, 166 N. W. 880; Aplin v. Smith, 197 Iowa 388, 197 N. W. 316; Van Derhoof v. Chambon and State Farm Mut. Auto. Ins. Co., 8 Pac. (2d) 925; American Auto. Ins. Co. v. Struwe, (Tex. Civ. App.) 218 S. W. 534.

We do not think the provisions of the policy sued on, or those of our statute, above quoted, in regard to the insolvency of an insured, whose wrongful act caused loss or damage, were intended to confer an original cause of action against the insurer to recover the loss or damage, nor does the fact that it was alleged and proved that the tortfeasor — the insured — was insolvent affect either the recitals of the statute or the obligations of the contract of insurance, although it is known in advance, and alleged, that a nulla bona return will be made upon an execution which may be issued upon any judgment recovered against the insured. The statute does not appear to contemplate that the insurer shall be made a party to an original suit to determine the question of liability and the extent thereof, but does provide that, after an execution is returned unsatisfied (which execution could not be issued until after there had been a judgment upon which to base the execution), “that then an action may be maintained by the injured person, or his or her personal representative, against such corporation under the terms of the policy for the amount of the judgment in said action not exceeding the amount of the policy,” and this right of action is not defeated by the insolvency or bankruptcy of the person insured, notwithstanding the fact that the policy would otherwise be one of indemnity merely.

In other words, the effect of the provisions of the. policy and of the statute regarding insolvency is that, notwithstanding that the policy is one of indemnity to 'the insured, the fact that he was insolvent or bankrupt, and thereby unable to respond in damages for his wrongful act, shall not operate to relieve the insurer. If, by an execution issued upon a judgment for the loss or damage, the injured plaintiff could collect, and did collect, his damages, he would not be concerned abont the policy of insurance. But, if he is unable to collect his judgment, “then an action may be maintained” against the insurer. Until the injured party has recovered a judgment to compensate his “loss or damage,” he can have no cause of action against the defendant indemnitor, which is neither a necessary nor a proper party to a direct suit for the damages.

We have here a policy conforming to the statute which created a cause of action which would not otherwise exist, and the cause of action thus created can only be maintained under conditions specified, which are that, upon an execution' being returned unsatisfied, the plaintiff in the judgment may maintain an action against the insurer for the amount of the damage not exceeding the amount of the policy.

We are cited to certain cases which it is asserted have held to the contrary, but there are points of difference in the policies construed or in the applicable statutes of the States where the cases arose. At any rate, we have given our statute what we regard as a fair and proper construction, and that is, that the insurer may be sued only upon a judgment previously recovered against the insured, in which suit the insurer was neither a necessary nor a proper party.

The provision of the policy that “ * * * an action may be maintained by the injured person (or such other parties in whom the right of action vests) against the company for the amount of the judgment of said action not exceeding the amount of the policy” does not contravene our statute, but conformed to it, and, as no original or direct cause of action is conferred against the indemnitor, the judgment against it must be reversed, and that cause of action will be dismissed as having been prematurely brought. This order does not, of course, affect the right' of appellee to sue the insurance company, if unable to collect his judgment against the Davis estate.


author: Humphreys, J.

text:
    Standard Oil Company of Louisiana v. Davis.
    4-2533
    Opinion delivered May 16, 1932.

      Robinson, House £ Moses and Roberts £ Stubble-field, for appellants.

      McMillan £ McMillan and J. H. Loohadoo, for appellee.
   Humphreys, J.

This suit was brought by appellee as administratrix of the estate of Louis Davis, deceased, and for the next of kin in the circuit court of Clark County against appellants to recover damages for the death of the intestate occasioned through their alleged negligence.

Appellants filed an answer denying the material allegations of the complaint, and, in addition, pleaded contributory negligence on the part of the intestate as the cause of his death.

The case- was tried upon the pleadings, evidence introduced by the parties, and instructions of the court, resulting in a judgment against appellant in the sum of $25,000, from which is this appeal.

The intestate was killed in a collision between an automobile he was driving and a lumber truck driven by Larkin Denton on Highway 53 about half way down Barringer’s Hill, between Grurdon and Camden. L. A. Cox and Ernest Sebee were riding in the Chevrolet coupe which the intestate was driving. They were traveling south and descending the hill behind appellant’s truck and when about half way down attempted to pass appellant’s truck and ran head on into the lumber truck, which was traveling north, about the time the two trucks were passing each other. Soon after starting down the hill, Thornton, who was driving appellant’s truck, observed the lumber truck starting up the hill. The collision occurred about seven-thirty p. m., on the 17th day of September, 1930, just about dusk. The lights in ail the ears were on. The road, at the point of collision, was about 25% feet wide. All were driving at a reasonable rate of speed. Denton was on the extreme east side of the road as he ascended the hill. The evidence is conflicting as to whether Thornton was in the middle or on the west side of the road, and also as to whether' he knew the intestate was attempting to pass his truck as they were descending the hill and as to whether he turned to the right to allow him to pass and before the intestate had done so, turned to the left and forced him to run into.the lumber truck. In view of the dispute in the evidence touching appellant’s negligence, the court might -well have submitted that issue to the jury, had there been any conflict in the evidence on the issue of contributory negligence on the part of the intestate. The undisputed testimony reflects that the intestate was guilty of contributory negligence resulting in his own death; so, instead of submitting the issue of negligence on appellant’s part, the court should have instructed a verdict for appellant on account of the contributory negligence of the intestate. According to the undisputed testimony, the intestate turned to the left in an effort to pass appellant’s truck when about half way down the hill without first ascertaining whether the way was clear and' could have accomplished his purpose had the lumber truck coming up the hill with which he collided not been so near. It was almost dark, and before attempting to pass appellant’s truck, the intestate should have seen to it, in the exercise of ordinary care for himself and his companions, that the way was clear of nearby approaching ears from the south, and this, too, even though appellant had been or was negligent in failing to turn to the right sooner than he did or after starting to turn to the right, he turned to the left. The negligence on the part of the intestate consisted in attempting to pass appellant’s truck at the particular time he did so without ascertaining to a certainty that the way was clear of nearby approaching cars from the south. Had the truck driven by Denton not been in the way, the intestate could have passed appellant’s truck, notwithstanding appellant’s negligence just as Denton’s truck, coming north, passed it in the clear. It was not intended, according to the law of the road, on a highway only- 25% feet wide, .for three rapidly driven cars to pass each other at the same point. Denton had the right-of-way on his side of the highway, and the intestate should not have attempted to occupy that space in order to pass a truck in front of him.

On account of the error indicated, the judgment is reversed, and, as the case seems to have been fully developed, the cause is dismissed.


author: •Hart, C. J.,

text:
    Central States Life Insurance Company v. Holcombe.
    4-2565
    Opinion delivered May 23, 1932.

      Burk Mann and T. D. Wyime, for appellant.

      J. B. Milham, for appellee.
   •Hart, C. J.,

(after stating the facts). It is first sought to uphold the judgment on the theory that the insurance company had funds in its hands belonging to the insured which would have paid the next quarterly premium, and, that being true, it was its duty to apply the amount thereto. Inter-Ocean Casualty Company v. Copeland, 184 Ark. 648, 43 S. W. (2d) 65. The amount referred to was a canceled check for the sum of $23.68, sent by the insured to the company. According to the testimony of Mrs. Holcombe, this represented payment of interest in advance in the sum of $14.88, due on the loan note of $248 remaining unpaid on March 7, 1930,' and a balance of $8.80, representing cash payment on the annual premium of $58.80, due on March 7,1930. The check was applied to these purposes. Hence there were no funds on hand belonging to the insured with which to pay the next premium, due March 7, 1931.

The next contention of the plaintiff is that the company waived the forfeiture under the principles of law decided in Home Life & Accident Company v. Scheuer, 162 Ark. 600, 258 S. W. 648. On this branch of the case, Mrs. Holcombe testified that they saw in a newspaper a notice that a receiver would be applied for, and that in December, 1930, they wrote to the company with respect to its financial condition. They received a reply that the company would notify them as soon as it was reorganized, and the company did not notify them. She admitted that the letter had been lost and, further on in her testimony, stated that she thought, when they got the company reorganized, they would let them know to whom to pay the premium. She admitted that she knew that the premiums were due annually on the 7th day of March, and that they had a grace period of thirty days. She also admitted that she knew that, under the terms of the policy, it would be forfeited if they did not pay the annual premium when due, and that the forfeiture would take place under the terms of the policy without any notice thereof. It will be noted that the insured wrote to the company to know about its financial condition, and there was no definite promise made by the company to waive the forfeiture under the terms of the policy, and the insured had no right to rely upon the general statement which plaintiff says was in the letter to the effect that the company would notify the insured when they got reorganized. Plaintiff admits that they were moving around the country at that time and did not stay in one place long.

It is next insisted that there was a waiver of the forfeiture by the letter dated April 7, 1931, which was not received until the 17th day of April, the date on which the insured was fatally burned, and died therefrom sometime that night. This letter appears to have been a form letter, signed “Conservation Department.” It was written about the premium loan of $300, which had been placed against the policy, covering the note due March 5, 1931. The letter also notified the insured that the arrangement was to help continue the policy in force, and that the loan might be paid in part or in full at any time during the continuance of the policy. In conclusion, the insured was reminded in the letter that premium notices would be sent, and that all future premiums should be paid promptly in order to maintain the valuable protection that the policy offered. She admitted that she knew the date the premiums were due, and that the policy would be forfeited under its own terms if the annual premium was not paid within the thirty days’ grace extension after it became due. This court has held that, under a policy of life insurance providing that it should become void on failure to pay premiums when due, the nonpayment of a premium when due ipso facto caused a forfeiture of the insured’s rights under the policy. Home Life & Accident Company v. Haskins, 156 Ark. 77, 245 S. W. 181; and Home Life & Accident Company v. Scheuer, 162 Ark. 600, 258 S. W. 648.

The result of our views is that, under the undisputed evidence, the court should have directed a verdict for the defendant. For the error in refusing to do so., the judgment must be reversed; and, inasmuch as the cause of action has been fully developed, it will be dismissed here. It is so ordered.


author: Smith, J.

text:
    Dowell v. Slaughter.
    4-2566
    Opinion delivered May 23, 1932.

      J. V. Walker, Cravens Cravens and Dwight L. Savage, for appellant.

      John R. Duty, John Mayes and C. D. Atkinson, for appellee.
   Smith, J.

Appellants, who are citizens and taxpayers of Washington County, filed a complaint on October 7, 1931, in which they alleged that on July 6, 1931, a day of the July, 1931, term of the county court, there was entered upon the records of that court the following order:

“NOTICE
“The Washington County Court, July term, 1931, first day, July 6,1931, in the matter of the debt of Washington County, Arkansas, due December 7, 1924.
“Declaration of indebtedness and order.
“This, the Washington County Court, having made a thorough examination and investigation of the indebtedness of Washington County, Arkansas, existing on the 7th day of December, 1924, being the day when amendment No. 11 to the Constitution of the State of Arkansas was adopted and became effective, finds and declares that the indebtedness of Washington County existing on the 7th day of December, 1924, amounted to the sum of $65,-000, still exists, is still outstanding, and. on this date remains unpaid.
“The clerk of this court is directed to. publish for one insertion, in some newspaper having a bona fide circulation in the county, a copy of this order, to the end that any person who desires to question the correctness of the finding here made may bring suit for that purpose within thirty days after such publication.
“Done and ordered in open court, this the 6th day of July, 1931.
“J. Lona Slaughter Judge.”

A copy of this order, duly certified by the clerk of the county court, was published in a weekly newspaper published in that county on July 6, 1931, and on August 10, 1931, bonds were issued in the name of "Washington County in the sum of $65,000, and sold for that amount.

On the date of the issuance and sale and delivery of these bonds, the following order was made and entered of record in the county court:

“Washington County Court, July term, 1931, August 10, 1931. In the matter of the transfer of surplus funds in the bond account to the county general account.

“Now on this, the 10th day of August, 1931, comes on to be heard the matter of transferring funds from the bond account to the county general account, and the county treasurer, Chas. S. Stearns, being present in person, and, upon the evidence adduced at the hearing, the court finds:

“That on August 10,1931, a bond issue was made for Washington County, Arkansas, in the sum of $65,000, and that on the 10th of August, 1931, the treasurer of said county received the proceeds of said bond issue in the sum of $65,000; and the court further finds that the purpose of said bond issue was to pay off the indebtedness of said county as of date December 7,1924, and that warrants issued and then existing for said indebtedness have heretofore been paid by the treasurer of said county out of the general funds belonging to said county, and that there is now a surplus in the bond account in the sum of $65,000, and that there is now no outstanding warrants against said account, and that by virtue" of the authority of act No. 30, of the Acts of the General Assembly for the State of Arkansas, in the year 1927, and under the law, said bond account should be transferred to the county general account and the county reimbursed.

“That the warrants drawn on the following funds are payable out of the county general account, county general, pauper, jail and inquisition, justice of the peace and circuit court funds.

“Therefore it is considered, ordered and adjudged by the court that the sum of $65,000, together with the interest on daily balances on said amount since the 10th day of August, 1931, be and the same is hereby transferred, and the county treasurer is hereby ordered to transfer on his books said amount from the bond account to the county general account and pay warrants drawn on the above named funds out of the county general account.

“J. Lona Slaughter, Judge.”

It was alleged by the citizens and taxpayers in their complaint that this order of July 6, 1931, was false and fraudulent, in that there was no indebtedness then outstanding of the county which had been incurred prior to December 7, 1924. It was prayed that the court appoint a master to inquire into and report upon the state of the county’s finances, and that the order of the county court be held to be illegal, fraudulent and void, and that the county treasurer be enjoined from paying any of said bonds.

A demurrer was filed alleging five grounds therefor, and the court sustained the 3d, 4th and 5th grounds. The demurrer reads as follows:

“Come now the defendants in the above entitled action and demur to the complaint as amended of the plaintiffs in said action upon the following grounds:

“1st. That the court has no jurisdiction of the persons of the defendants or of the subject-matter of the action.

“2d. That there is a defect of parties defendant.

“3d. That the complaint does not state facts sufficient to constitute a cause of action.

“4th. That the complaint shows upon its face that the cause of action attempted to be stated by the complaint as amended is barred by the statute of limitations.

“5th. That the complaint shows upon its face that the alleged cause of action attempted to be stated therein has been adjudicated by the county court of Washington County, Arkansas.”

From the decree of the court sustaining the demurrer to the complaint upon the g'rounds above stated is this appeal.

This appeal challenges the validity of the bonds issued and sold on August 10,1931, pursuant to the order of the court made and entered on July 6,1931.

In making the order of July 6, 1931, the court acted under the authority of the amendment to the Constitution adopted at the general election held in 1924, and which has frequently been referred to as amendment No. 11. Owing to the confusion arising from the fact that certain amendments to the Constitution had been numbered in the order of their submission, rather than in the order of their adoption, the Secretary of State has compiled a list of the amendments now in force, and this list, as thus compiled, has been published in vol. 184 of the reports of this court, pages XIX, et seq., and the amendment heretofore frequently referred to as No. 11 has been given No. X, and we employ that number in referring to it.

It was held in the case of Matheny v. Independence County, 169 Ark. 925, 277 S. W. 22, that amendment No. X. (there referred to as amendment No. XI) became effective December 7,1924, and that it was self-executing, even without an enabling act.

By this amendment to the Constitution, the counties of the State (as well as cities and incorporated towns) were given authority * * * “to secure funds to pay indebtedness outstanding at the time of the adoption of this amendment, * * by issuing interest-bearing certificates of indebtedness or bonds, for the payment of which authority was conferred to levy a tax, in addition to the taxes theretofore authorized, not exceeding three mills, and to levy and collect such tax until such indebtedness was paid.

At the ensuing session of the General Assembly an enabling act was passed, entitled, “An Act to Facilitate the Funding of the Debts of Counties, Cities and Incorporated Towns.” Act 210, Acts of 1925, page 608. Section 1 of this act provides as follows:

“Before the issue of any county or city bonds under this act, the county court shall, by order entered upon its records, declare the total amount of such indebtedness or the city or town council shall by ordinance declare the total amount of such indebtedness. Such order of the county court shall be published immediately for one insertion in some newspaper published in the county, and such ordinances of the city or town council shall be immediately published in some newspaper issued in such city or town, if there be one, and, if not, in some newspaper published in the county; and any property owner who is dissatisfied may, by suit in the chancery court of the county, brought within thirty days after the publication of such order or ordinance, have a review of the correctness of the finding made in such order or ordinance ; but if no such suit is brought within thirty days, such finding shall be conclusive of the total amount of such indebtedness, and not open to further attack, and if said suit is brought the adjudication shall settle the question, and appeal therefrom must be taken and perfected within thirty days. If any officer of such county, city or town shall wilfully make any false statement as to the amount of its indebtedness, he shall forfeit his office and be ineligible to hold any other office of profit or trust in this State. ’ ’

Other sections of the statute provide that the bonds thus authorized to be issued shall be negotiable coupon bonds, payable serially, through a period not exceeding-forty years, and shall bear interest at a rate not exceeding six per cent.; that the bonds shall not be sold at less than par, but with the privilege of converting into bonds bearing a lower rate of interest, and for the levy of a tax to pay the bonds.

A penalty is prescribed against any officer who shall include in the debt to be funded any debts which were not due in g*ood faith at the time of the adoption of the amendment, and the fiscal year is made coincident with the calendar year.

These provisions are not here involved and need not be enlarged upon.

It will be observed that, under § 1 of the act of 19'25, copied above, the county court (in case of counties) is required, before issuing bonds, to ascertain the outstanding indebtedness of the county on the date upon which the amendment became effective, which, as has been said, . was December 7, 1924, and, after ascertaining that fact and entering' an order of court evidencing that finding, notice thereof shall be given in the manner there provided.

The making of this finding and the publication thereof is made a condition precedent to the exercise of the power to issue bonds, and, while the amendment does not require that the notice shall announce this purpose, the publication of the notice is made tantamount to a declaration of that intention.

The act provides that “any property owner who is dissatisfied may, by suit in the chancery court of the county, brought within thirty days after the publication of such order or ordinance, have a review of the correctness of the finding made in such order or ordinance; but if no such suit is brought within thirty days, such finding shall be conclusive of the total amount of such indebtedness, and not open to further attack, and if said suit is brought, the adjudication shall settle the question, and appeal therefrom must be taken and perfected within thirty days.”

The property owners in' the instant case seek to excuse their delay of over thirty days after the publication of the court order before bringing suit by alleging that they were unaware of its publication until after the thirty days had expired. But the act does not authorize suit within thirty days after knowledge had; on the contrary, the act requires-that the suit be “brought within thirty days after the publication of such order.”

Inasmuch as the complaint concedes that the suit was not brought within the time limited by the act, the validity of the bond sale depends upon the validity of the act, for, if this suit must be brought within thirty days after the publication of the court order, and not thereafter, the instant suit was not brought within that time, and the demurrer was properly sustained for that reason, if the act itself is valid.

For the reversal of the decree of the court sustaining the demurrer, it is insisted that, under the allegations of the complaint, the county court was without jurisdiction to make the order, that there was no authority to issue bonds unless there was an outstanding indebtedness on December 7, 1924, .and, as the complaint alleged there was no indebtedness as of that date, the truth of which allegation the demurrer confessed, there was no authority to issue bonds, and the action of the county court was therefore coram non judice, and is open to the attack here made upon it.

We do not concur in this view. The county court had the jurisdiction conferred by the amendment and the enabling act passed pursuant thereto to issue bonds to discharge the indebtedness named, and the court was required to find, before exercising this jurisdiction, that there was such debt, and the amount thereof, and, having made that finding, to publish notice thereof, to the end that property owners who were dissatisfied with such finding might have a review of the correctness of it made in the chancery court. In order to make the bonds salable, by having this question put at rest, the right of the property owner to raise the question was limited to thirty days, this being regarded by the G-eneral Assembly in the passage of the enabling act as a reasonable time within which to raise that question. The notice was given, and more than the time limited was allowed to expire before this right was exercised, and in the meantime the bonds were sold and paid for, and the rights of the bondholders have intervened. These bonds were sold and paid for under an order apparently valid upon its face, and the rights of the holders of these bonds must be protected unless the proceeding leading to their sale is void.

It is no new doctrine to hold that, when the right of a court of superior jurisdiction to exercise a jurisdiction conferred is dependent upon the existence of a given state of facts, the court has the right and is under the duty to ascertain whether those facts exist, and its finding upon that question is not subject to a collateral attack.

For instance, the case of Whitford v. Whitford, 100 Ark. 63, 139 S. W. 653, was one in which there was a contest between the mother and the alleged wife of a decedent to recover compensation for his wrongful death. The decision of this question turned upon the validity of a decree for divorce, it being contended by the mother that the alleged widow was not the lawful wife of her son, for the reason that she had obtained a divorce from a former husband, before marrying’ her son, without having first resided in this State for one year before instituting the suit for divorce, as required by the laws of this State.

The statute then in force provided that “The plaintiff, to obtain a divorce, must allege and prove, in addition to a legal cause for divorce: First. A residence in the State for one year next before the commencement of the action.” As a condition upon which the jurisdiction of the chancery court might be invoked to grant a divorce, the plaintiff was required to allege and prove a residence in this State for a year next before the commencement of the action, and the mother insisted that as such proof could not have been truthfully made, the decree of the chancery court granting a divorce was void.

The reasoning of the court in overruling that contention is apposite here, and we quote from it as follows:

“In determining the sufficiency of a judgment against collateral attack, a distinction must be observed ‘between those facts which invoke the jurisdiction of the court over the parties and subject-matter and those quasi jurisdictional facts, without allegation of which the court cannot properly- proceed and without proof of which decree should not he made; absence of the former renders the judgment void and assailable collaterally, but not so as to the latter.’ (23 Cyc., 1074.) ‘Where the court judicially considers and adjudicates the question of jurisdiction, and decides that the facts exist which are necessary to give jurisdiction of the case, the finding is conclusive, and cannot be controverted in a collateral proceeding.’ (Id. 1088.) ‘A judgment cannot be impeached collaterally on account of any defects in the pleadings. Its validity cannot be impugned, for instance, by showing that a wrong form of action was chosen, or that the complaint does not state facts sufficient to constitute a cause of action.’ Id., 1094; Warner v. Hess, 66 Ark. 113, 49 S. W. 489.

“It seems to be well settled that a judgment rendered by a court having power to deal with the general subject of the action, although against the facts or without facts to sustain it, is not void as rendered without jurisdiction and cannot be questioned collaterally. 14 Cyc. 723.

“ ‘The fact of required residence of plaintiff in a divorce suit cannot be collaterally questioned if it was a jurisdictional question necessarily passed on by the court in its finding and decree.’ Hilbish v. Hattle, 33 L. R. A. 783.”

Counsel for the mother in that case conceded the principle that courts of general jurisdiction, having decided in favor of their jurisdiction, are presumed to have acted upon evidence justifying such decision, but it was contended that ‘ ‘ such presumption is indulged only where the record is silent; where the evidence appears in the record with respect to the jurisdiction on which the decree is based, no presumptions are indulged in.” In answer to this argument, the court said: “But this, we think, must necessarily be confined to questions of jurisdiction which arise in regard to the person or subject-matter of the action. Otherwise, every judgment rendered by a court where its jurisdiction rested upon its having determined the existence of a certain fact upon the existence of which its jurisdiction to proceed to judgment must depend rests forever upon the dubious proposition as to whether every other court whose proceedings encounter it will take the same view of what was established by the evidence before the court that rendered it.”

It is true the instant case is not one in which there are adversary parties, and is one in which the public generally has an interest. Upon tliis question the court, in the Whitford case, supra, said: “We do not overlook the fact that a divorce proceeding is one in which the public is interested. The parties can waive nothing essential to the validity of the proceeding, and all statutory requirements must be observed; but, in determining upon collateral attack, whether such has or has not been the case, we know of no reason why the same verity should not be imported to a decree for divorce which guards the sanctity of a decree rendered by a superior court having jurisdiction of the parties and the subject-matter.”

The instant proceeding was commenced as an ex parte case, but it was one in which any property owner had the right to intervene, provided he did so within the time limited for that purpose. We have before ns a record containing a recital of the jurisdictional fact which the court was required to find, to-wit, that there was an indebtedness, before exercising its jurisdiction, and, as no one has questioned that finding within the time and manner allowed by law, it has become final.

In the case of Blanton v. Forrest City Mfg. Co., 138 Ark. 515, 212 S. W. 330, it was said: “In determining the validity of a judgment upon a collateral attack, a distinction must be observed between those facts which involve the jurisdiction of the court over the parties and subject-matter, and those quasi jurisdictional facts, without allegation of which the court cannot properly proceed and without proof of which a decree should not be made. The absence of the former renders the judgment void upon collateral attack.” See also Merchants’ & Planters’ Bank v. Hammock, 178 Ark. 746, 12 S. W. (2d) 421.

Here there were no parties unless property owners made themselves such, and the jurisdiction of the court over the subject-matter is not denied.

This is not a case where an order was entered which the court was without power to make. It had that power, and the only question presented is that of the existence of the quasi jurisdictional fact which the court was required to find, and did find, before exercising its power to sell bonds, to-wit, the existence of the indebtedness.

It was said in the case of Stumpff v. Louann Provision Co., 173 Ark. 196, 292 S. W. 196, that “The county court is a court of superior jurisdiction, and its judgment, rendered in pursuance of jurisdiction rightfully acquired, cannot be attacked collaterally. Sharum v. Meriwether, 156 Ark. 331, 246 S. W. 501.”

We do not pursue the discussion of this subject further, as a concrete application of the principles involved have been made in identical proceedings.

In the case of Stahl v. Sibeck, 183 Ark. 1146, 40 S. W. (2d) 442, it was said: “The order of the county court in 1925 found that the county was indebted in the sum of $350,000. No person brought any suit to review the finding within the time limited, and it thereupon became ‘ conclusive of the total amount of such indebtedness, and not open to further attack,’ and is res judicata.” See also Stranahan, etc., Inc., v. Van Buren County, 175 Ark. 678, 300 S. W. 382.

It is finally insisted that, if the statute be construed as we have here construed it, it is unconstitutional as being arbitrary and unreasonable and inadequate to afford the property owners an opportunity to resist the proceeding. This contention may be disposed of by saying that statutes have been frequently upheld by this court, some of which provide even less than thirty days’ notice of proceedings whereby taxes were imposed which became liens upon the lands of the territory affected. Among these are: Luck v. Magnolia-McNeil Road Imp. Dist. No. 1, 141 Ark. 603, 217 S. W. 781; House v. Road Imp. Dist. No. 2, 158 Ark. 330, 251 S. W. 12; Howell v. White River Levee Dist., 174 Ark. 381, 295 S. W. 381.

As it appears from the allegations of the complaint that this proceeding to question the order of the county court was not begun within the time limited by law for that purpose, and no ground of avoidance was shown, the right to proceed was properly raised by demurrer. Smith v. Missouri Pacific R. R. Co., 175 Ark. 626, 1 S. W. (2d) 48.

It follows, from what we have said, that the demurrer was properly sustained, and the decree is therefore affirmed.


text:
    Starling v. Hamner.
    4-2557
    Opinion delivered May 23, 1932.

      Marsh, McKay $ Marlin, for appellant.

      Henry Moore, Jr., for appellee.
   Smith, J.

Without reciting or reviewing the conflicting testimony appearing in the record in this case, we announce our conclusion to he that the preponderance of this testimony establishes the following facts:

J. W. Starling was engaged in farming a tract of land which he had contracted to buy, and the title to which was involved in a suit argued and submitted on the same date on which the instant case was submitted in this court.

The Hamner-Edwards Company, hereinafter referred to as the company, made advances to Starling to enable Starling to cultivate the land, and these advances were secured by a chattel mortgage on Starling’s mules and a horse, upon his farming tools and implements, and upon all the crops grown on the farm.

On March 7,1930, a settlement was had of the farming accounts, and it was agreed that the balance then due was $2,189.06. To secure this balance, a note was executed to cover, not only the balance, but the anticipated advances for the year 1931. The note thus executed was for the sum of $4,500, and bore interest at the rate of ten per cent, per annum from date until paid. It appears, however, that the true intention of the parties was that the mortgage should cover the amount which might be due upon foreclosure of the mortgage, and that the note was executed in order that the company might use it as collateral in securing advances made to it, and not to otherwise evidence the debt. This was in accordance with the custom under which they had previously operated.

The company was engaged in the general furnishing business, and it was contemplated that the advances should consist principally of supplies sold Starling at the company’s store, although advances in money were made during the year 1931 slightly in excess of $700. Monthly statements were furnished to Starling of all advances. Groods were sold and charged at cash prices, and, on August 1st, a full and final settlement of the account was rendered, to which there was added 10 per cent, of the total “for time,” as that item appeared on the account. This 10 per cent, charge was made only at that time. This addition was made to the cash advanced as well as to the price of the goods sold, and was the method employed to increase the credit prices 10 per cent, above the cash prices. The correctness of this account does not appear to have been questioned by Starling.

On January 2,1931, Starling died. He was survived by his widow and certain children begotten by her. He ivas also survived by certain children by a former marriage. Starling’s affairs Avere badly involved, and litigation was threatened between the widow and her children and Starling’s children by his former marriage.

An appeal was made by Mrs. Starling to M. M. Hamner for advice and assistance. M. M. Hamner was not connected with the company, although the senior member of that firm was his relative, and M. M. Hamner had sold the farm to Starling, which the latter operated.

M. M. Hamner interceded for Mrs. Starling and made an agreement with the company by which its debt secured by the chattel mortgage was to be reduced to $2,500, which was to be paid in the following manner: Starling had left certain life insurance payable to his widow. M. M. Hamner agreed to pay the company $1,000, and pursuant to that agreement paid the company $1,000 in cash, and as security therefor took an assignment of the chattel mortgage and the debt which it secured to himself. The balance of $1,500 was to be paid by Mrs. .Starling when she collected her insurance, and the insurance was collected, but Mrs. Starling declined to perform her agreement, which had been evidenced by a written memorandum thereof. She refused to comply with this agreement by paying the $1,500 which she had promised to pay, and, upon her cross-examination as a witness, declined to state why she did not do so. We think it fairly inferable from the testimony to say that two reasons induced this decision: The first was that she had adjusted her differences with her stepchildren, but the principal reason was that the mortgaged property was not worth the money which she had obligated herself to pay.

Although the company’s mortgage and the debt which it secured were assigned to M. M. Hamner, we think there was no intention on his part to foreclose it until after Mrs. Starling refused to perform her contract. The mules were in thin order, and Mrs. Starling had no feed for them, and they were collected and turned over to M. M. Hamner with Mrs. Starling’s consent. There was nothing to do with these mules but to feed them until farming operations began.

Upon the advice of M. M. Hamner, Mrs. Starling qualified on March 3, 1931, as administratrix of her husband’s estate, and she approved the claim of Hamner against her husband’s estate, and it was allowed and classed by the probate court. However, an appeal was later prosecuted from this probate order, which appears to be pending and undisposed of in the circuit court.

On March 24,1931, (at which time Mrs. Starling had definitely declined to perform her contract by paying the $1,500 out of the insurance money which she had then collected) this suit was filed by M. M. Hamner to foreclose the mortgage which had been assigned to him. The company, as assignor of the debt and the mortgage securing it, was made a co-plaintiff. -

The chancellor found that the debt secured by the mortgage at the time of the rendition of the decree from Avhich this appeal comes was- only $3,700. Just how this amount was arrived at is not clear, unless the court struck out of the account the charge for cash money advanced. Upon this finding it was decreed that “M. M. Hamner do have and recover of, from and against the property above mentioned (in the mortgage) the snm of $3,700 * * V’ and that the lien of M. M. Hamner against said property “was superior and paramount to any rights of any of the other parties hereto.” No personal judgment was rendered against any one, and the sale of this mortgaged property was ordered. Pursuant to this order of sale, the mortgaged property was later sold by the commissioner appointed to make the sale for $700.

Various defenses were interposed to this foreclosure suit, which we now proceed to discuss.

It is insisted that the mortgage, if otherwise valid, could not be held as security for any amount in excess of $2,500, the consideration for its assignment which M. M. Hamner assumed and agreed to pay. This would be true if Mrs. Starling had performed her agreement in regard to its transfer. But she did not do so.

If Mrs. Starling’s written agreement in regard to the assignment of the mortgage be treated as an obligation on her part to pay $2,500, she did not pay it. On the contrary, she repudiated that obligation and refused to perform it. Treating this obligation as a promise to pay, or even as a promissory note, did not enlarge her rights. It is settled law that giving a promissory note for a debt is not a payment of the debt unless, by agreement of the parties, the note is taken in payment of the debt. This is true even of a note executed by a third party. Bank of Hatfield v. Bruce, 164 Ark. 576, 262 S. W. 665; Hume v. Indiana Life Ins. Co., 155 Ark. 466, 245 S. W. 19, and cases there cited. The contract between Mrs. Starling and M. M. Hamner for the ultimate assignment of this mortgage to her for a consideration of $2,500 was, in effect, annulled by her refusal to perform the contract entitling her to the benefit of the reduction in the debt, and M. M. Hamner was, and is, as the court below decreed, the legal holder of the mortgage and the debt which it secures.

It is unimportant whether M. M. Hamner has paid to the company all of the $2,500 or not. He is obligated to do so, and his assignor, the company, was a party to the foreclosure proceeding and made no question as to M. M. Hamner’s ownership of the mortgage, and the company is bound by the finding of the court that M. M. Hamner is in fact the owner of the mortgage.

It is insisted that M. M. Hamner converted the mortgaged property to his own use without foreclosing the mortgage, and thereby became liable for its actual market value at the time of the conversion, and should be charged with this value. It may be said that the testimony is in irreconcilable conflict as to the value of the mortgaged property, but the fact remains that when sold by the commissioner under the foreclosure decree the mortgaged property brought only $700.

We do not, however, pass upon the question of the actual market value of the mortgaged property, for the reason that we do not find, nor did the court below find, that there had been any conversion of it. The testimony established the fact that, after making his agreement with Mrs. Starling, Hamner took possession of the mortgaged property, but, as default had been made in the payment of the debt secured by the mortgage, he had the right to do so. Thornton v. Findley, 97 Ark. 434, 134 S. W. 627; 33 L. R. A. (N. S.) 491; Lee Wilson & Co. v. Crittenden County Bank, 98 Ark. 384, 135 S. W. 885; Barron-Fisher-Caudill Co. v. Rhoda, 126 Ark. 556, 191 S. W. 229.

We do not find that Hamner took possession of the mortgaged property as the owner thereof. There is but little question that Hamner would have turned the mortgaged property over to Mrs. Starling had she complied with her contract.

One of the items of the mortgaged property to which testimony was especially directed was that of the cottonseed which Starling had on hand at the time of his death, and this testimony confirms our view that there was no conversion. After the date of the alleged conversion, an agueement was reached between Hamner and Mrs. Starling’s representative that Hamner should use the seed and pay fifty cents per bushel for them, which appears to have been a most reasonable allowance on that account. It is true that Hamner took possession of the mortgaged property on February 10, 1931, but, as we have said, this was for the purpose of taking care of it, and not for converting it to his own use. Indeed, at that time Hamner was expecting Mrs. Starling to comply with her original contract and would, no doubt, have delivered the property to her, had she performed this contract by paying the $1,500 as agreed.

It is also insisted that the debt was usurious and void for that reason, and that the usury consisted in taking the note above mentioned. But we do not agree with this contention. The monthly statements furnished Starling in his lifetime, and the testimony in the case, show conclusively that the note was only an estimate of what the. account would finally be, and was in the nature of an accommodation note which the company might use as collateral, and that it was at all times the intention of all the parties that the final indebtedness would be determined from statements of the account.

The 10 per cent, addition to the account was dated on August 1st, at which time the crops had been “laid by, ’ ’ and the advances ceased and the credit items would thereafter be in excess of the debit items. There could be, and was, no usury in adding 10 per cent, to the cash price of goods which were not sold for cash, but on credit. Brakefield v. Halpern, 55 Ark. 266, 15 S. W. 190; Blake Bros. v. Askew & Brummett, 112 Ark. 514, 166 S. W. 965; Standard Motors Finance Corporation v. Mitchell Auto Co., 173 Ark. 879, 293 S. W. 1026, 57 A. L. R. 877.

The foreclosure suit was based upon the account, and not upon the note, but, if the note were held to be usurious, this would not affect that portion of the account incurred for goods purchased, and would invalidate only such portions of the account as were based upon the loan of money. Usury cannot be predicated upon the charge of a profit of more than 10 per cent, for goods sold on credit. Atkinson v. Burt, 65 Ark. 316, 53 S. W. 404; Tillman v. Thatcher, 56 Ark. 315, 19 S. W. 968; Briggs v. Steel, 91 Ark. 458, 121 S. W. 754.

The account, on August 1, 1931, amounted to $4,687.73, and the decree, rendered December 29, 1931, found tbe indebtedness secured by tbe mortgage to be $3,700. The difference between these items is $987.73, which is greater than the money advanced and the price of the cottonseed combined, so that, if the note were usurious, the judgment is for a sum no greater than the balance due, exclusive of the money advanced (the only items against which the plea of usury could be asserted), and that of the seed also. To constitute usury, there must be an agreement requiring the borrower to pay, and entitling the lender to receive, a higher rate of interest than that allowed by statute for the loan or forbearance of money, and the plea of usury cannot therefore be sustained. Cheairs v. McDermott Motor Co., 175 Ark. 1126, 2 S. W. (2d) 1111.

The decree appears to accord with the preponderance of the testimony, and it must therefore be affirmed, and it is so ordered.


text:
    Missouri Pacific Railroad Company v. Miller.
    4-2568
    Opinion delivered May 23, 1932.

      Thos. B. Pryor and II. L. Ponder, for appellant,

      Coleman <c& Reeder, for appellee.
   Humphreys, J.

This is an appeal from a judgment for damages to a mule that beeame entangled in a cattle guard which had been voluntarily constructed by appellant on a roadside to prevent stock running at large from coming upon its right-of-way. It was alleged in appellee’s complaint that appellant company negligently and carelessly permitted said cattle guard to become partly filled with weeds, trash, dirt and other obstructions so as not to be discernable and so as to resemble the road leading to and across same, and that a certain mule belonging to appellee and being of the value of $125 or more, in walking down said road, walked upon said stock guard and his feet were caught in same, and the said mule fell through said cattle guard, and, in attempting to get out or by reason of his fall, was seriously and permanently injured. The suit was brought and judgment obtained in a magistrate’s court, from which an appeal was prosecuted to the circuit court of Independence County, ■where, upon trial de novo, the judgment was obtained from which is this appeal.

Appellant’s contention for a reversal of the judgment is that the suit was brought under §§ 8478 and 8479 of Crawford & Moses’ Digest, which afforded appellee no protection against damages to his property because he.was not a landowner and because he failed to give the notice required by said statute as a prerequisite to the maintenance of a suit. The sections referred to penalize a railway company for failure to construct, keep and maintain in good repair cattle guards, after ten days’ written notice, on each side of the inclosures through which its lines run, by requiring it to pay the owners of the inclosures, in addition to actual damages sustained a penalty of not less than $25 nor more than $100. The undisputed evidence reflects appellee was not an owner of an inclosure, and that he had not given appellant ten days’ written notice to construct the cattle guard, or to keep and maintain same in good repair. Based upon this evidence, appellant requested an instructed verdict in its fp,vor, which refused. The trial court correctly refused to so instruct the jury. This suit was not brought under these statutes. The gist of the complaint was for negligently maintaining the cattle guard voluntarily constructed in such manner as to injure stock lawfully running at large. Jones & Norris v. Nichols, 46 Ark. 207, 55 Am. Rep. 575. The remedy under the statute referred to is exclusive to the owners of inclosures, hut has no application to damages sustained by others on account of the negligent and careless maintainance of a cattle guard. The statutes referred to did not in any manner curtail or abrogate the common-law remedy for damages for maintaining dangerous nuisances.

No error appearing, the judgment is affirmed.


author: Mehaeey, J.

text:
    Axley v. Hammock.
    4-2618
    Opinion delivered May 23, 1932.

      D. L. Purloins, Clary & Ball and J. R. Wilson, for appellant.

      Williamson Williamson and Aubert Martin, for appellee.
   Mehaeey, J.

The petitioner filed suit in the Bradley Circuit Court against the respondent, Southern Lumber Company, for damages for slander, alleging that Fred Wyman, president of respondent company, and acting within the scope of his authority, falsely and maliciously spoke and published, of and concerning plaintiff, certain false, malicious and defamatory words, setting out the words spoken, and asked for damages.

The respondent, defendant in the slander suit, filed a demurrer, a motion to make the complaint more specific, and complaint was amended to comply with the motion to make more specific.

After the demurrer filed by defendant was overruled, the defendant filed answer in which it alleged, among other things, that Wyman had no authority to act for it in the utterance of any slander. It denied that Wyman spoke and published the slanderous words alleged in complaint, and denied any malicious intent, and in fact denied all the material allegations with reference to the charge of slander. It alleged in addition that the slander was unauthorized, that it was a privileged communication, and defendant also pleaded the truth of the statements alleged to have been made, and a settlement of the entire matter, and that the plaintiff was estopped; that the slander was the result of plaintiff’s own repetition and publication of an alleged slander of plaintiff’s own making; that a suit had been filed for the same slander against Wyman, and was still pending.

In addition to the answer the defendant filed a counterclaim and cross-complaint in which it alleged misconduct on the part of the plaintiff in numerous ways and numerous acts of improper conduct with reference to defendant’s property, alleging that defendant had wrongfully appropriated to his own use much of the money and property and many facilities of defendant without knowlege of said company; that an accounting which would involve many thousands of items to be found hidden in vast volumes of records and files covering a period of many years, complicated because of the wrongful action of plaintiff, was necessary; that it was necessary to appoint a master.

The defendant attached to his counterclaim and cross-complaint a motion to transfer to equity, setting up all the defenses mentioned in its counterclaim, and many others which it alleged entitled it to have the cause transferred to equity; asked for judgment against the plaintiff in damages, and the cause was, over the objection of plaintiff, transferred to the chancery court.

The plaintiff then in chancery court filed a motion to remand to the circuit court, which was overruled, and plaintiff required to go to trial.

The defendant’s pleadings in the circuit court, including the answer, counterclaim and cross-complaint, together with the motion to transfer to equity, consist of more than forty pages, and it would be useless to set out the pleadings in full.

The chancellor made lengthy findings. Among other things the court said in its findings that it was impossible to reconcile the testimony upon any point materially affecting the issues.

The court also said in its findings: “This court is not impressed with much of the allegations contained in the cross-complaint. Some of these allegations are frivolous and merely challenge conditions long acquiesced in by defendant corporation. Some are referable to faulty judgment rather than intentional wrongdoing on the part of the cross-defendant.”

The court then entered a decree that the court had full and complete jurisdiction of both the parties and the subject-matter and the issue, as made by the pleadings, and that the pleadings set forth matters cognizable exclusively in equity; that the appointment of a master was proper, and that the plaintiff’s request for a jury, and motion to remand to the circuit court were denied and overruled, to which plaintiff excepted.

There are many other specific statements in the decree which it is unnecessary to set out in this opinion. The court dismissed the complaint of plaintiff and dismissed the cross-complaint of defendant.

The court in its decree, names more than 150 witnesses who gave testimony.

The petitioner filed in this court, April 15, 1932, an application for writ of certiorari, and prays that the decree and judgment of the chancery court he quashed, and that an order be issued by this court directing that said cause of action be remanded to the circuit court for trial, and for other relief.

A response was filed by the chancellor and Southern Lumber Company in which they first demurred, stating that it is an effort to use certiorari as a substitute for appeal. They also contend that, unless all the pleadings filed in the lower court are printed in full, this court cannot exercise an informed and intelligent discretion; that the writ of certiorari does not properly lie to courts of chancery; that the petitioner is estopped. It is also stated in the response that the entire record is necessary to the exercise of an intelligent discretion, and that the petition was not filed in time, and the response then denies the allegations contained in the petition.

It is first contended by the respondents that the writ should be denied because it is obviously an effort to use certiorari as a substitute for an appeal, and they call attention to Adams v. Sub-Drainage District No. 3, 171 Ark. 802, 286 S. W. 962.

It is true that there is a statement in the opinion in that case that certiorari cannot be used as a substitute for appeal, and the orders are not brought up on appeal for correction of error.

It is the general rule, in this State, that the writ of certiorari cannot be used as a substitute for appeal.

As contended by the respondent, the writ of certiorari is not a writ of right, but is one of discretion. Many cases are cited by respondent to support this rule, but it may be said that the rule is well established in this State that the writ of certiorari is not a writ of right, but is a writ of discretion.

The petitioner cannot demand as a matter of right that the writ issue. On the other hand, the respondent cannot claim as a matter of right that the writ shall not issue. It is a matter, not of right, but of discretion, and that means of discretion to grant or refuse the writ.

Discretion of a judge or court, when called upon to grant or refuse a petition for a writ of certiorari, requires the judge or court to act according to the dictates of their own judgment and conscience, and it involves a fair consideration of all the peculiar features of the particular question involved.

“In a broad sense, the option which a judge may exercise, either to do or not to do that which is proposed to him that he shall do; choosing between the doing and not doing of a thing, the doing of which cannot be demanded as an absolute right of party asking it to be done; the exercise of the right legally to determine between two or more causes of action.” 18 C. J. 1135.

The respondent can no more demand that the court refuse to grant the writ than the petitioner can demand that it grant it, but the granting or refusing to grant the writ is within the sound discretion of the court.

In determining whether the writ should be granted or not, the court will look only to the face of the record, and will not consider questions of fact.

It is wholly unnecessary to call attention to or review authorities cited to support this proposition.

It is next contended by the respondent that the application for the writ should be dismissed unless all of the pleadings in the lower court, resulting in the transfer of the case to the chancery court are printed in full.

The complaint filed in the 'Bradley Chancery Court was a suit'for damages for slander, and the only court having jurisdiction to try an action for slander is the circuit court, and no pleadings filed by the defendant in such suit could authorize the transfer of the case to the chancery court, and thereby deprive the plaintiff of the right to trial by jury.

The statutes as to counterclaim and set-off referred to and relied on by respondent do not authorize a transfer of a lawsuit to the chancery court.

Section 1195 of Crawford & Moses’ Digest provides: 1 ‘ The counterclaim mentioned in this chapter may be any cause of action in favor of the defendants, or some of them, against the plaintiffs, or some of them.”

Prior to the enactment of this statute, the cause of action that could be pleaded in a counterclaim was some matter arising out of the contract or transaction set forth in the complaint as the foundation of the plaintiff’s claim, or connected with the subject of the action.

Under the law as amended, it is not necessary that the cause of action mentioned in the counterclaim arises out of the contract or transactions, or that it is connected with the subject of the action. In other words, it may be any cause of action in favor of the defendants against the plaintiffs, whether growing out of the contract or transactions or connected with the subject of the action or not.

This is the only change made in the law as to counterclaim, and the same change was made as to set-off, but, both before the amendment and since, the cause of action mentioned in the counterclaim must be within the jurisdiction of the court. It was not the intention of the Legislature in enacting these statutes to violate the Constitution. The presumption is that the Legislature did not intend to violate the Constitution, but, if these statutes are construed as contended for by respondent, they would violate the Constitution.

Section 7 of art. 2 of the Constitution of Arkansas, provides: “The right of trial by jury shall remain inviolate, and shall extend to all cases at law without regard to the amount in controversy; but a jury trial may be waived by the parties in all cases in the manner prescribed by law.”

The right to trial by jury would not remain inviolate if, in an action only cognizable in a court of law, the defendant could interpose defenses and cause a transfer to a court of chancery, and thereby deprive the plaintiff of the right to trial by jury, and the defendant cannot secure a transfer to chancery of a case of which the court of chancery has no jurisdiction.

Even if the transfer to the chancery court did not deprive the plaintiff of a trial by jury, still the judgment of the chancery court in the slander suit would be void, because such court has no jurisdiction in a slander suit, and it is the general rule that the judgment of a court having no jurisdiction over the subject-matter is void.

In speaking of the jurisdiction in Freeman on Judgments, it is said: “A lack of it, on the other hand, will lay the judgment open to successful impeachment if such fact is made to appear from the face of the record or by matters dehors where extraneous evidence is receivable for the purpose.”

“It is this jurisdictional element that differentiates a void from a voidable judgment, the distinction between them being that when a court attempts to render the former a jurisdictional fact is absent without the existence of which the court is without authority to act at all. A judgment, in fact, rendered by a court whose want of jurisdiction is made to appear is no judgment at all and binds no one.” 1 Freeman on Judgments 668.

Consent cannot give jurisdiction of the subject-matter, although it may of the person, and where the court has no jurisdiction of the subject-matter, the judgment is void, and a void judgment is a nullity. Grimmett v. Askew, 48 Ark. 151, 2 S. W. 707; Blanton v. Forrest City Mfg. Co., 138 Ark. 508, 212 S. W. 330; Oliver v. Routh, 123 Ark. 189, 184 S. W. 843; Hart v. Wimberly, 173 Ark. 1083, 296 S. W. 39.

It is next contended by respondent that writs of certiorari do not properly lie to courts of chancery. This court has settled the question against the remonstrant in the case of Martin v. Hargrove, 149 Ark. 383, 232 S. W. 596. It not only settled the question that certiorari will lie to courts of chancery, hut the opinion in that case stated: “Inasmuch as the orders of the court exceed its jurisdiction, certiorari is an appropriate way to bring before this court for review.”

This court is therefore committed to the doctrine, not only that the writ will lie to a chancery court, but that it is the appropriate method to bring void judgments before this court for review.

Where the chancery court has no jurisdiction to try the case before it, that is, no jurisdiction over the subject-matter, its judgment is void, and since the original suit, brought in the circuit court was for damages for slander, the chancery court had no jurisdiction, and no pleadings that could have been filed by the defendant in that suit would give the chancery court jurisdiction.

It is wholly unnecessary, and would be improper, to consider the evidence, because the circuit court alone had jurisdiction to try the slander suit.

As contended by respondent, it was evidently the intention of the Legislature, in adopting the provisions with reference to counterclaim and set-off, to permit persons to settle in a single suit all matters in dispute between them, but it was manifestly not the intention of the Legislature to violate the Constitution and deprive one of the right to trial by jury, nor to give the chancery court jurisdiction to try cases that were only cognizable in a court of law.

It is contended that the pleadings on the part of the defendant in the slander suit gave the chancery court jurisdiction. Section 1194, Crawford & Moses’ Digest, which provides that a defendant may set forth in his answer as many grounds of defense, counterclaim and set-off, whether legal or equitable, as he shall have, does not authorize equitable defenses in a suit for slander. All the defenses proper in a slander suit are legal defenses. Defendant in a slander suit may introduce evidence tending to show justification or partial justification.

Section 1229 Crawford & Moses’ Digest provides: “In the actions mentioned in-the last section, the defendant may, in his answer, allege both the truth of the matter charged as defamatory and any mitigating circumstances legally admissible in evidence to reduce the amount of damages, whether he proves the justification or not, he may give in evidence the mitigating circumstances.” These defenses are legal defenses in a suit for slander.

Lengthy briefs have been filed by both parties, and many authorities cited. We do not deem it necessary to discuss or review all the authorities cited. We have reached the conclusion that the chancery court was without jurisdiction, and that its judgment is void.

The certiorari is sustained, and the judgment of the chancery court in the slander suit is set aside, and the chancellor directed to remand the slander suit brought by petitioner to the Bradley Circuit Court.

Smith and McHaney, JJ., dissent.