text:
    Brown & Froley v. Monroe County Road Improvement District.
    Opinion delivered May 22, 1922.
    1. Highways — sufficiency of evidence. — In a contractor’s action against a road improvement district for compensation for grading, evidence held to sustain finding that there was no error in the engineer’s estimates of the quantities of grading to be done.
    2. Contracts — decision of engineer — conclusiveness.—A decision of the engineer of a road improvement district as to the quantity of grading done by contractors is conclusive, in the absence of fraud, where the parties stipulated to that effect.
    3. Highways — grading contract — obligation to supply gravel.— A grading contract did not require a road improvement district to supply contractors with a sufficient quantity of gravel to keep the contractor’s employees steadily employed where the contract did not expressly so provide.
    4. Highways — sufficiency of evidence.- — In a grading contractor’s action against a road district for damages for loss of time caused by failure of district’s engineers to set grade stakes, evidence held to sustain finding of chancellor that the grade stakes were set.
    5. Highways — liquidated damages — waiver.—Where the engineer of a road improvement district acquiesced in the suspension of grading because of unfavorable weather conditions, the district will be held to have waived a provision for liquidated damages on failure to complete the contract within a certain time.
    Appeal from Monroe Chancery Court; John M. Elliott, Chancellor;
    affirmed.

      Mehaffy, Bonham & Mehaffy, for appellant.

      G. F. Greenlee, for appellee.
   Wood, J.

Brown & Froley (hereinafter called appellants) are partners engaged in the business of constructing roads in the State of Arkansas. On the 12th of February, 1919, they entered into a contract with the Monroe County Road Improvement District, through its commissioners, to construct a certain road in Monroe County. They alleged that the district is indebted to them in the sum of $14,805.35 for grading; that under the contract the district was to supply appellants with sufficient gravel to keep appellants’ employees'steadily employed in hauling and placing the same upon the road; that the district breached its contract in this respect, to the damage of the appellants in the sum of $4,872.64; that it was the duty of the district to set grade stakes and at all times to have sufficient work laid out to keep the grading force of the appellant steadily employed; that the district failed to comply with its contract in this respect, to appellants’ damage in the sum of $5,056.

The above allegations were contained in the com-, plaint and amended complaint of appellants, and judgment is prayed for the above amounts.

The district, through its commissioners, answered, denying that the appellees were indebted to the appellants in the above amounts, and set up by way of cross-complaint that under the contract the appellants should have completed the work before May 1, 1920; that on account of their failure to comply with the contract in this respect they were indebted to the appellees in the sum of $4,695, liquidated damages, for which they prayed judgment. The appellees further set up that in June, 1919, the appellants became dissatisfied with the estimates of the quantities of grading allowed appellants by the engineers of the district; that thereupon the appellants and appellees agreed to submit the matter to arbitration, which was done; that the appellants agreed with the appellees that the finding of this board should be binding, and that the board of arbitration found that there had been no error in the estimate of the engineers of the district in quantities of grading allowed appellants, and that appellants were bound by such finding.

The trial court, after hearing the testimony adduced on the above issues, dismissed the complaint and also the cross-complaint for want of equity. From the decree against them the appellants prosecute this appeal, and appellees cross-appeal.

1. The decree of the court is correct. Under the terms of the contract the appellants agreed to construct the improvement “in exact accord with the plans and specifications, copies of which were attached to and made a part of the contract. ’ ’ Among other provisions in these specifications, is the following: ‘ ‘ The engineer shall furnish monthly estimates of the work done upon which partial payments to the contractor shall be based, and,"in the absence of fraud or error, his decision as to the value and quantity of work or material shall be final and conclusive. ’ ’ It will be observed that it is not alleged in the complaint that the engineer was guilty of any fraud. The undisputed testimony shows that, after the controversy arose between the appellants and the engineers of the district in regard to the estimate of grading quantities allowed by the engineers to the appellants, the appellants agreed with the engineers of the district that the controversy should he submitted to a board of arbitration, the appellants selecting one, the engineers selecting one, and the State Highway Department selecting the third member of the board. The report of this board in part is as follows: “We visited the work in person and examined both the field and office work, making numerous measurements of the completed work in order to check the cross-sections. The engineer’s notes were gone over carefully and the calculations checked in the office. Our investigation has disclosed no error in the engineer’s work. ’ ’ This report was signed 'by all the members of the board of arbitration.

In regard to the estimate of the engineer of the district of the quantity of grading of which the appellants complain, the trial court found as follow®:

“A number of witnesses testified on behalf of the plaintiffs as to the number of yards of earth removed, but the testimony of these witnesses is not specific enough to overturn the estimate >of the engineers of the district on which the commissioners made settlement. Witness Conley, for the plaintiff, merely gives an estimate of the yardage moved. He does not state he made any measurements of the number of yards, and does not claim to be competent to make a measurement. Witness- Dickinson, it seems, made an estimate, but the value of his testimony is considerably diminished by reason of the fact that he, together with two other gentlemen, all claiming to be engineers, signed a written statement in which they said, among other -things: ‘The investigation has disclosed no error in the engineer’s work.’ In this statement they also state that they visited the work in person, and examined both field and office work, making numerous measurements, etc. They also state that they went over the engineer’® notes carefully,” etc.

The above findings of the court we approve. The issue is purely one of fact. The testimony bearing on the issue is voluminous, and it could serve no useful purpose to set it out and discuss it in detail. After a careful examination of the record, we have reached the conclusion that the decided preponderance of the evidence shows that the board of arbitration found and reported correctly that there was no error in the engineer’s work. The testimony of the engineer who made the estimates of the work as it progressed and who made a monthly report, and the testimony of three other competent engineers, tended to prove that the estimates of the grading made by the engineer who did the work were correct. The testimony tending to prove otherwise, as the trial court found, was not sufficient to overcome the findings of the engineer who made the estimates and the board of arbitration. True, the testimony of Dickinson, one of tbe engineers, who was a member of the board of arbitration, tended to show that the report of the board of arbitration was not really correct, but was made only for the purpose of giving the engineers a “clean bill of health,” and that he made a supplementary or second report at the same time in which he stated as follows: “As engineers familiar with this class of work, we are unanimous in the opinion that the circumstances surrounding this work are such that the contractor has necessarily moved more material than is shown by the cross-sections, and that he has not been sufficiently compensated for the actual labor performed.” This witness further testified that at the suggestion of Bennett, one of the arbitrators for the engineering firm, the report was divided into two parts; one part wholly clearing the engineering company from any mistakes, and the other1 a recommendation to the board for relief to the contractors. He further testified there was no doubt in the minds of the arbitrators that the work would cost the contractors approximately twice as much as the estimates amounted to. “There was no doubt in our minds,” says the witness, “that the contractors had moved more yardage than was given by the engineering company.” This witness, 'by testifying to matter's directly contradicting matters set forth in the report signed by him in connection with the arbitration, places himself in the unenviable attitude of challenging his own report as a member of the board of arbitration. His testimony is not entitled to as much consideration as the testimony of other arbitrators who did not sign his individual report and who flatly contradicted him as to the correctness of such report.

Bennett, one of the other arbitrators, who was selected by the engineering firm, categorically denied that he had requested Dickinson to divide the report into two sections in order to give the engineers of the district a “clean bill of health.” He testified that the arbitrators were appointed because of a difference as to quantities allowed by the engineer of the district, and the board was selected to determine whether the engineer’s estimates were correct, and in witness’ opinion the estimates were correct.

Major Parkes, of the engineering firm, also positively denied that he requested Bennett to sign a report giving his company “a clean bill of health.”

The other arbitrator testified that he signed the report. He saw Dickinson’s statement. The report was intended to cover all the work done to date. The arbitrators were of the opinion that the contractors had not been sufficiently compensated, and therefore they made a rec-. 'ommendation to the board of commissioners that they should be allowed additional compensation.

The decided preponderance of the evidence shows, however, that the arbitrators were willing to make this recommendation, not because there was any error in the estimates of the grading, but because appellants were victims of weather conditions and other unfortunate circumstances which caused them to lose money in performing their contract. It occurs to us that the trial court was correct, in the conflict between the testimony of Dickinson and his own report and the testimony of another commissioner and other witnesses, in finding that the value of Dickinson’s testimony was “considerably diminished.” After a careful review of the entire testimony, we conclude that there was no error in the estimates of the quantities of grading given by the engineer of the district to the appellants. Although this arbitration was not binding upon the appellees, nevertheless we are convinced that a decided preponderance of the evidence shows that the finding of the board of arbitration was correct. The decision of the engineer as to the quantity of this work under the terms of the contract was therefore final and conclusive and binding on the appellants. The court ruled correctly in so holding.

2. As to the item of $4,872.64, growing out of the alleged failure of the appellees to supply appellants with a sufficient quantity of gravel to keep appellants’ employees steadily employed, let it suffice to say that the contract does not provide that the appellees shall furnish gravel to the appellants to keep appellants’ forces steadily employed, and that a failure upon the part of the appellees, to furnish gravel so as to keep appellants’ forces from being idle would render the appellees liable in damages for such failure. It must be presumed that the parties were contracting with reference to all the conditions confronting them at the time, such as weather conditions and the difficulties to be encountered in obtaining gravel in sufficient quantities to keep appellants’ forces steadily employed. Since the contract does not contain any such provision, liability of appellees predicated upon breach of such provision cannot be maintained. If the appellants contemplated that such a duty and obligation should rest upon the appellees, then they should have seen to it that the contract contained such a provision. In the absence of such contractual duty and obligation, no damages can be recovered by the appellants as for as a breach of contract in this respect. Furthermore, even if the contract had contained such provision, the court found as follows: “Not only is the evidence sufficient to sustain the plaintiffs’ contention, but there is testimony tending to show that there was gravel on the siding at Keevil and Overholt.” On this issue of fact we are convinced that a preponderance of the evidence sustains the finding of the trial court.

3. In regard to the claim of appellants for damages on account of the loss of time caused by reason of the failure of the appellees’ engineers to set-grade stakes, the court found “that the plaintiffs’ proof going to sustain the same was positively disputed by the defendants and by the engineers who had charge of the work. Furthermore, this item does not seem to have been considered seriously at the time the original complaint was filed.”

The original complaint was filed January 15, 1920, and the appellants at that time sought to re-cover only for alleged damages growing out of the failure of the appellees’ engineers to give appellants correct grading estimates and the failure of the appellees to furnish gravel in sufficient quantities to keep appellants ’ forces steadily employed. About eighteen months thereafter an amended complaint was filed alleging damages on account of the failure of appellees’ engineers to set grade stakes. It occurs to us that if the appellees’ engineers failed to set grade stakes, appellants would have been fully advised of this fact when they instituted their action to recover damages on account of erroneous grading estimates. Be this as it may, the testimony on behalf of the appellants tending to prove that their forces were idle because of the failure of the appellees ’ engineers to set grade stakes was overcome by the testimony of the local engineer in charge of the work to the effect that grade stakes were set. We are convinced that the finding of the chancellor on this item is correct.

4. The trial court refused to award the appellees damages on their cross-complaint. The contract provides that the appellants agreed to begin work on the 25th of February, 1919, and to complete the same before the 1st of May, 1920, and upon failure to complete the work in time it was specified that the appellants should pay to the appellees the sum qf $15 for each day delayed as liquidated damages. The appellees, in their cross-complaint, prayed for damages in the sum of $4,695, damages for delaying to complete the work for the period of one year. On account of unfavorable weather conditions and the obstacles because thereof, which appellants had to overcome in the performance of their contract, it was not the intention of the appellees to enforce the above provision of the contract as to liquidated damages. No claim was made for such damages in the original answer of the appellants to the appellees’ complaint, and not until the appellant had filed an amended complaint asking for damagfes on account of the alleged failure of appellees’ engineers to set grade stakes did the appellees set up any claim for liquidated damages. It does not appear that the commissioners at any time previous to this had notified the appellants that they were going to insist on snch damages. On the contrary, the testimony tends to prove that the appellees have waived the above provision of the contract as to liquidated damages. One of the appellants testified that they suspended work in November, and that the engineers released their outfit, over there until appellants were notified by them to return, and that appellants had not been so notified.

The appellants introduced in evidence a letter from the supervising engineer of the appellees, which it is unnecessary to set forth, but this letter clearly indicates that the appellees through this conduct of the supervising engineer had acquiesced in the suspension of the work by appellants on account of unfavorable weather conditions. This letter shows that the appellees were not going to insist on appellants continuing their full force on the work during the winter, but consented to the use of “two teams and a man to run the grader and haul gravel and keep the road perfect during the winter, or until such time as the engineer shall direct their return of their full force to the work.” Under all the circumstances the appellees must be held to have waived the provision of the contract as to liquidated damages.

. We find no error in the decree, and the same is therefore affirmed.


source: Caselaw Access Project

author: Hart, J.

license: Public Domain

text:
    Farmers’ Club Company v. Emmerson Mercantile Company.
    Opinion delivered May 22, 1922.
    1. Sales — evidence.—Evidence held to sustain a verdict finding that a certain oil engine was in first-class condition when sold, with the exception of missing parts to be furnished by seller.
    2. Appeal and error — credibility of witnesses a jury question.— The jury, and not the Supreme Court, are the judges of the credibility of the witnesses.
    3. Appeal and error — conclustveness of verdict. — The Supreme Court cannot review the finding of a jury where there is evidence of a substantial character to support it.

      4. Evidence — admission of agent. — Where the authority of the seller’s agent was limited to the installation of an oil engine, he could not bind the seller by an ex parte affidavit, though such affidavit could be used to contradict his testimony given at the trial.
    5. Sales — instruction.—Where seller furnished missing parts for an oil engine and sent an experienced man to attach them to the engine within a short time after the engine was sold, but the buyer refused to receive the parts or to permit them to be attached, it was proper to refuse to instruct the jury to find for buyer if the repair was not made within a reasonable time.
    Appeal from Fulton Circuit Court, Archie E.ov,se, Judge, on exchange;
    affirmed.
    STATEMENT OE FACTS.
    Appellant sued appellees to recover damages for a breach of contract in the sale of an engine for its gin plant. Appellee denied any breach of contract and asked judgment against appellant for $1,000, balance due on the purchase money.
    According to the evidence of appellant, on the 6th day of August, 1918, appellant’s manager wrote to the Emmerson Mercantile Company asking for the condition and price of a fifty-horse power International Harvester oil engine which appellant had been informed had only been run one season and was for sale. On the 13th day of August, 1918, the manager of the Emmerson Mercantile Company wrote appellant that said company had a fifty-horse power International Harvester Company engine which had been run altogether less than three months; that it was a cylinder latest model engine and was in first-class condition; that said company had installed a sawmill in connection with its gin and this necessitated the use of steam power to consume the waste from the sawmill. A price of $1,600 cash was made on the engine, which included oil tanks, • water tanks, and all equipment of the engine. Sometime later Thad W. Rowden, appellant’s manager, went to Emmerson, Ark., and bought the engine in question from W, D. Wingfield, manager of appellees, for the price of $1,600; $500 of which was paid in cash and the balance to be paid in deferred payments. Rowden told Wing-field that appellant wanted the engine for immediate nse in running its gin plant, and Wingfield represented to him that the engine was in first-class condition. There were some missing parts which Wingfield said that he could get from the International Harvester Company for appellant and put them in at once. When the engine was installed, it was ascertained that it would develop but little horse-power and would not run the gin plant of appellant as represented. The engine was discovered to be in very bad condition and could not have been put in shape for that season’s ginning. The various defects in the engine were pointed out by appellant’s witnesses, but it is not necessary to state them in detail in order to present the issues raised by the appeal. On account of these defects appellant refused to pay for the engine, or to receive the parts necessary for its repair. Hence this lawsuit.
    According to the evidence of appellees, after they had written to appellant stating the condition of the engine and its price, it was about two months before anything further was heard from appellant. About the first of October^ Rowden, appellant’s manager, came down to examine the engine, and in the meantime some of the parts had been taken off of it for use by appellees. Rowden examined the engine thoroughly for appellant and was told by Wingfield, who was representing appellees, that some of the parts were missing, but that otherwise the engine was in first-class condition. Wingfield said that he could supply the missing parts from the International Harvester Company and would have them attached to the engine as soon as it was set up. The missing parts were ordered from the International Harvester Company and the bill therefor amounted to something over $400. A representative of the International Harvester Company went up to appellant’s place of business for the purpose of attaching the missing parts. He found that the engine had not been properly set on its foundation, and returned home. Subsequently he went back for the purpose of attaching the parts, and appellant refused to take the parts out' of the railroad office or have them attached to the engine.
    It was also shown in evidence by appellant that the agent of the International Harvester Company had made an affidavit, at the request of the appellant, in which he stated that the engine was not in first-class condition and was so defective and worn that it could not have been ■ repaired except for temporary use. This agent testified at the trial that the engine was in good condition except for the missing parts, and that, after being repaired, it would last for some years, dependent upon the use of it.
    The jury returned a verdict for appellees, and from the judgment rendered appellant has duly prosecuted an appeal to this court.

      Geo. T. Humphries and G. E. Elmore, for appellants.
    "Where there is a false warranty which contains the elements of fraud and deceit in it; the party has his election to affirm the contract and sue upon the breach of warranty, or repudiate it. 100 Ark. 17; 88 Ark. 422; 93 Ark. 454 ; 22 Ark. 454 ; 53 Ark. 155; 81 Ark. 549; 110 Ark. 215.

      H. A. Northcutt, P. G. Goodwin, and Oscar E. Ellis, for appellees.
   Hart, J.

(after stating the facts). It is earnestly insisted by counsel for appellant that the evidence is not legally sufficient to sustain the verdict. At the request of appellant, the court instructed the jury that if it believed from the evidence that the contract was that the engine should be in first-class condition except the missing parts, and that the evidence showed it was not in first-class condition, appellant would have a right not to accept it, and might recover the amount it had paid *m the purchase price together with the freight.

On the part of appellees the jury was instructed, that if it believed from the evidence that the contract was, that appellees would furnish whatever parts that were missing, and which were necessary to put the engine in first-class condition, and that appellees stood ready to carry out the contract on their part, and appellant refused to allow them to do so, then the verdict should be for appellees on their counterclaim for the sum of $1,000 due on the purchase price.

The court further instructed the jury that, if it believed from the evidence that the engine was in such defective condition that it could not have been put in first-class condition, then appellant would have the right to reject the same without waiting for appellees to repair it, and appellant was entitled to recover.

No exceptions were saved to the giving of these instructions, and they substantially submitted to the jury the respective theories of the parties to this lawsuit.

We cannot agree with counsel for appellant in their contention that there was no legal evidence to support the verdict. One of the witnesses for appellees testified that if they had been allowed to put in the repairs that they ordered, on the engine, it would have been in good condition and would have lasted appellant a good long time. He said that the engine was not burned out on the inside, and that the cylinders did not need reboring. He was sent up there to repair the engine and was prevented from repairing it by appellant. He had had ten years ’ experience in installing machinery of this kind and seeing that it operated in a satisfactory manner.

Wingfield, the manager of appellees, also testified that the engine was in good condition and ready for operation when the missing parts were attached to it; that he ordered the missing parts to be shipped to appellant at its place of business, and sent an experienced machinist up there to attach the parts to the engine.

It is true that the evidence for appellant showed that the engine was in very bad condition, and could not have been put in condition for use except temporarily. The jury, however, were the judges of the credibility of the witnesses, and under the settled rules of this court we cannot review its finding where there is any evidence of a substantial character to support it. In other words, the question of the preponderance of the evidence is a matter for the jury trying the case, and we have no concern with it on appeal. It is our duty to uphold the verdict where there is legal evidence to support it, and the evidence for appellees, if believed by the jury, entitled them to recover the balance of the purchase price on the engine.

Counsel for appellant also assign as error the refusal of the court to instruct the jury that if it found that appellees, or their agent, notified appellant that the machinery could not be put in first-class condition, appellant had a right to reject the same, and the jury should find for appellant.

This instruction was predicated upon an affidavit made by F. B. Cooper, the agent of the International Harvester Company, who was sent by that company at the request of appellees to attach the missing parts to the engine.

At the request of appellant he made an ex parte affidavit to the effect that the engine could not be put in first-class condition. He was not the agent of appellees for any purpose except to install the engine. Hence he could not bind appellees by an ex parte affidavit as to the condition of the engine. Cooper testified as a witness in the case, and it was proper to introduce the affidavit for the purpose of contradicting his testimony given at the trial and thereby attacking his credibility as a witness.

It is also insisted by counsel for appellant that the court erred in refusing to instruct the jury that, if it found that the repair of the engine was not made within a reasonable time after the agreement to repair it, it should find for the appellant.

There was no error in refusing <to give this instruotion. Appellees ordered the missing parts for the engine from the International Harvester Company and got that company to send an experienced man to attach the parts to the engine. This was done within a short time after the engine was sold to appellant. Appellant refused to receive the parts or to permit Cooper to attach them to the engine, on the ground that the engine was in such defective condition that it could not be placed in first-class condition for that season’s ginning. There was no issue on the failure of appellees in making repairs on the engine within a reasonable time, and on this account the court did not err in refusing this instruction.

The respective theories of appellant and appellees were submitted to the jury in instructions to which no objections were made or exceptions saved, and, there being evidence to support the verdict, the judgment must be affirmed.


text:
    Norwood v. Mayo.
    Opinion delivered May 22, 1922.
    1. Taxation — adverse possession under tax titee. — Under Crawford & Moses’ Dig., § 6947, limiting the time of bringing an action to recover lands sold for taxes to two years, actual possession of land taken and held continuously for two years under a tax deed bars an action for recovery, though the sale is irregular or void for jurisdictional defects.
    2. Adverse possession — sufficiency of possession. — ¡Where a person claiming cut-over land placed a tenant on the land who remained in possession eight months, and on his leaving another tenant took possession and remained some months, and then left, and the house was vacant for a month before another tenant took possession, and none of the tenants cultivated or inclosed the land, but only cut firewood, the possession was not of sufficient character to give title by adverse possession.
    3. Adverse possession — nature of possession. — In order to acquire title to woodland by adverse possession, there must be actual use of the land of such unequivocal character as reasonably to indicate to the owner visiting the premises during the statutory period that such use and occupation indicate an appropriation of ownership in another.
    Appeal from Craighead Chancery Court, "Western District; Archer Wheatley, Chancellor;
    affirmed.

      Gautney, Garaivay & Dudley, for appellants.
    A deed based on a void tax sale, on its face properly describing the land, and purporting to convey it to the purchaser, is color of title. 77 Ark. 324; 80 Ark. 82.
    Where a purchaser of land at a tax sale goes into possession under a deed properly describing it, and continues in possession for more than two years, he acquires title to the land. 129 Ark. 270.
    If the owner, having right of action for possession, fails to act for a period of two years, the title to the land should be quieted in the adverse holder. 83 Ark. 334; 76 Ark. 477; 60 Ark. 499; 60 Ark. 163; 66 Ark. 141; 59 Ark. 460; 23 L. R. A. (N. S.) 1102; 126 Ark. 86.
    Appellant having actual possession of part of the land under his deed, even though the deed was void, the land being occupied, had constructive possession of the whole tract. 71 Ark. 117; 78 Ark. 99; i80 Ark. 82; 93 Ark. 30; 84 Ark. 140.
    All actions to test the validity of the sale of lands delinquent for taxes shall be commenced within two years from date of sale. C. & M. Dig., sec. 10119; 1 R. C. L. 687 ; 2 C. J. 112.
    Any visible or notorious acts Which clearly evince an intention to claim possession is sufficient to establish a claim for adverse possession. Tiedeman on Real Property, 3 ed. sec. 495; 92 Ark. 321; 80 Ark. 82; 75 Ark. 593.
    The tax is a charge upon the land itself, and when sold vests the title in the purchaser. C. & M. Digest, sec. 10025. This conveyance carries with it the interest of all other persons in the land. O. & M. Digest, sec. 10109; 84 Ark. 1; 123 U. S. 747; 31 L. ed. 309. It is the land that is sold for taxes, and not merely the interest or equity of the owner. 18 Ark. 423; 39 Ark. 315.

      The appellant was entitled to a decree quieting Ms title under his tax deed, although the tax sale and deed 'based thereon were void. 76 Ark. 442; 76 Ark. 447; 79 Ark. 194.
    The appellees are not without proper remedy under the statute. C. & M. Digest, seo. 10047.

      Fuhr & Futrell, for appellees.
    A void tax sale can be followed by none other than a void tax deed. Possession for the required two years under a void tax sale and deed does not effect a devolution 'or investiture of title.
    The statute, C. & M. Digest, sec. 6947, is penal and must ibe strictly construed. 43 Ark. 409.
    A statute of short limitations must be strictly construed. 86 Ark. 300; 49 Ark. 203.
    The tax sale was void for the reason that the taxes had beén paid and the land was not delinquent when sold.
    The Legislature has the power to make the statute of limitations operate to devolve title, and, unless the language used is such as to compel such a construction, the courts should construe it as going to the remedy only. 83 Ark. 495; 96 Ark. 446; 96 Ark. 105; 67 Ark. 105.
   Hart, J.

Louis Mayo brought this suit in equity against W. A. Maywood to cancel as a cloud on his title a clerk’s tax deed to certain land in the western district of Craighead County, Ark.

Maywood relied on the validity of the tax sale and adverse possession for two years under his tax deed.

The chancery court found the issues in favor of the plaintiff, and a decree was entered accordingly. To reverse that decree the defendant Maywood has duly prosecuted tMs appeal.

At the trial it was shown that the title to the land in question was in Louis Mayo, and that he had regularly paid the taxes on the land up to and including the year 1916. His tax receipt for the year 1916 is exhibited in the record. The land was sold by the collector of taxes for the nonpayment of taxes for the year 1916, and W. A. Maywood became the purchaser at the tax sale. At the expiration of two years a clerk’s tax deed was executed to Maywood, and he entered into possession of the land under it. He claimed to have been in possession of the land under his tax deed for two years before the present suit was brought, but the testimony as to the continuity of his possession is in dispute and will be discussed later.

Counsel for the plaintiff first seek to uphold the decree on the theory that a short statute of limitations like 6947 of Crawford & Moses’ Digest applies only to tax sales invalid because of defects and irregularities in the proceedings, and that possession under such a statute will not sustain a deed that is valid on its face, if there were jurisdictional or fundamental defects in the sale, or where the taxes for the nonpayment of which the land was sold had in fact been paid. '

This is what is called the majority rule in 26 R. C. L. par. 399, and, amongst other cases, reliance is placed upon the case of Redfield v. Parks, 132 U. S. 239, where the Supreme Court of the United States in construing the statute now under consideration held that a deed of land sold for the nonpayment of taxes, which recites that the sale was made on a day which was not the day authorized by law, is void on its face, and is not admissible in evidence to support an adverse possession under a statute of limitations.

Subsequent to the rendition of that decision this court took up the precise question in Ross v. Royal, 77 Ark. 324, and the court held that a tax sale on a day not appointed by law is' void, but that actual possession of land taken and held continuously for the period of two years under a clerk’s deed bars an action for recovery, whether the sale be merely irregular or void on account of jurisdictional defects. The court said that the statute in question is a statute of limitations, and as such prevents the impeachment of the title even on grounds of fundamental and jurisdictional defects where possession has been held for the requisite length of time under it.

In the application of the rule in Dickinson v. Hardie, 79 Ark. 364, the court held that continuous adverse possession for more than two years under a clerk’s tax deed confers a valid title, although the owner of the land had paid the taxes before the day of sale. The court said that the statute in question is purely a statute of limitations and runs against void sales as well as voidable sales. These opinions have become rules of property in this State, and it is now too late to question their soundness or to overrule them.

Counsel for the plaintiff also seek to uphold the decree on the ground that the defendant did not have two years continuous unbroken possession of the land in question under his tax deed before this suit was brought, and in this contention we think counsel are correct.

The land in question was cut-over land. 'A railroad runs through one corner of the land. A sawmill company which had purchased the timber on the land had erected a small box storehouse on the railroad right-of-way on the land in question and another small box dwelling house on the land. After Maywood received his collector’s tax deed, he purchased the small box storehouse on the right-of-way from the person who owned it and placed a tenant in the box dwelling house on the land'in question. None of the land was in cultivation, and no rent was paid by the tenant, except that he agreed to look after the land for Maywood. This tenant remained upon the land for about eight months and then left. Another tenant immediately took possession of the house for Maywood. After remaining on the land for some months he left it, and the house was vacant for about a month before Maywood got another tenant to move into, the house. During all of this time no land was placed in cultivation and no improvements were made upon the land, except that a fence was placed around a garden spot which had been cleared. There was also a small amount of firewood cut from the land by the tenant for his own use.

In order to acquire title to woodland there must be actual use of the land of such unequivocal character as to reasonably indicate to the owner visiting the premises during the statutory period, that such use and occupation indicate an appropriation of ownership in another. Earle Imp. Co. v. Chatfield, 81 Ark. 296, and Connerly v. Dickinson, 81 Ark. 258. We quote from the earlier case of Scott v. Mills, 49 Ark. 266, the following:

“The adverse possession necessary to vest title in the holder must be continuous and unbroken for the full period prescribed by the statute. ‘Adverse possession,’ says Mr. Justice Gibson, in Stephens v. Leach, 7 Harris 262, ‘professing as it does to be founded not on title but on trespass, is essentially aggressive, and the stamp of its character must always be preserved by acts on the premises. A man does not discontinue his possession by .locking up his house in town, or suspending his cultivation in the country, provided he does not suffer the buildings in the one .case, or the fields in the other, to be thrown open; but he is bound to continue a positive appearance of ownership by treating the property as his own, and holding it within his exclusive control. An intention to resume suspended intrusion of which the owner of the title may know nothing, is short of the requirements of the statute. The question is not, what did the outgoing occupant intend? but, what did he do? Did he keep his flag flying and present a hostile front to adverse pretensions ? An adverse possession ought to be such as to challenge the right of all the world; but when an occupant has evacuated the place and suffered it to go to wreck, he hauls down his colors and his challenge is withdrawn.’ In other words, when one leaves the ground personally, during the period of limitation prescribed by the statute, he must leave it under circumstances indicating that he has not left the possession, but still 'holds it. He must so leave it that the condition and appearance of the premises themselves show to the world that there is still a person in actual control and exercise of dominion. If he should leave the premises, personally, but not in the condition or manner indicated, before the expiration of the time prescribed by the statute of limitations, he acquires no title by adverse possession.”

In the application of this principle to the present case it may be said that during the month of the two years in question when the land was vacant there was nothing to indicate to the owner, had he visited the place, that any one was in possession of it claiming it exclusively as his own.

It follows that the decree must be affirmed.


text:
    Davis & Worrell v. General Motors Acceptance Corporation.
    Opinion delivered May 22, 1922.
    1. Corporations — doing business in state. — The doing of business in this State by a foreign corporation is the exercise in this State of some of the ordinary functions for which the corporation was organized.
    2. Corporations — doing business in state. — A foreign corporation with an office outside of the State which furnished dealers in motor vehicles in Arkansas, with whom it contemplated doing business, with blank forms to be used by such dealers in selling their motor vehicles and through commercial agencies secured financial rating of .the dealers and customers to whom they made sales, but had no interest in the business of the dealers from whom it purchased commercial paper and no established agency in the State, and made its contracts regarding purchase of paper and paid for same outside the State, was not doing business in the State, within the meaning of Crawford & Moses’ Dig., §§ 1825-1832.
    3. Bills and notes — fraud.—In an 'action on notes given for the purchase of motor trucks, evidence held not to. show any fraud or misrepresentation by the seller of the trucks.
    4. Bills and notes — bona fide purchaser — defense.—In an action on notes given as part of the purchase price for motor trucks, where defendant alleged fraud and misrepresentation on the part of the seller, but the notes were transferred to plaintiffs before maturity and without notice of any fraud or misrepresentation, the alleged fraud and misrepresentation constituted no defense.
    Appeal from Lawrence Chancery Court, Western District; Lyma/n F. Reeder, Chancellor;
    affirmed.
    STATEMENT OF FACTS.
    The General Motors Acceptance Corporation brought this suit in equity against Davis & Worrell and the Newport Foundry & Machine Company to obtain judgment against the defendants in the sum of $1,969.20 and $1,916.48, the balance due respectively on two promissory notes given for two motor trucks, and to foreclose its vendor’s lien on the same.
    Davis & Worrell defended on the ground that the General Motors Acceptance Corporation could not maintain the suit because it was a foreign corporation and had not complied with our statute regulating such corporations, and that the sale of the motor trucks to them by the Newport Foundry & Machine Company had been induced by false representations.
    The General Motors Acceptance Corporation is a foreign corporation organized under the laws of the State of New York and it has a branch office at Dallas, Texas. On the 17th day of May, 1920, Robert Davis and Frank Worrell, doing business as Davis & Worrell, at Imboden, Ark., purchased from the Newport Foundry & Machine Company of Newport, Ark., two motor trucks, and after making a cash payment executed their negotiable promissory notes for the balance of the purchase money. Title to the motor trucks was retained in the seller until the balance of the purchase price was paid.
    L. C. Barber was a witness for the plaintiff. According to his testimony he was assistant credit manager for the General Motors Acceptance Corporation at Dallas, Texas, and the purchase of the notes in question was made in June, 1920, before the notes became due. The notes were purchased at Dallas, Texas, for value received before maturity. There is a balance due on one truck of $1,969.20 and on the other of $1,916.48. It was the custom of the plaintiff to furnish blank forms- of notes to the Newport Foundry & Machine Company of Newport, Ark., and to purchase notes executed to that company by purchasers of motor vehicles from it. The plaintiff has no agency in the State of Arkansas, but buys commercial paper from’ 'approximately forty concerns selling motor vehicles in the State of Arkansas. The plaintiff does not do business with any concern in Arkansas that does not handle the products of the General Motors Corporation. That corporation, however, is not owned by the plaintiff, and it does not appear whether the two corporations have the same directors and stockholders. The plaintiff company is not operated to handle the financial end of the General Motors Corporation. It purchases commercial paper from various persons and corporations in the State of Arkansas and elsewhere which sell motor vehicles. It requires the dealers from whom it buys the commercial paper to make a financial statement, and the amount of credit extended to such dealer depends upon such financial statement. The Newport Foundry & Machine Company had made such a statement, and the plaintiff had agreed to extend a line of credit to it. The plaintiff makes an investigation of the dealer’s financial condition and gives him a raff ing on this. The dealer indorses the commercial paper to the plaintiff. The investigation of the dealer is made through references given by him and by reports from commercial agencies.
    Davis & Worrell were investigated by the plaintiff before it purchased the notes in question. The notes in question were purchased from the Newport Foundry & Machine Company, and that company indorsed the notes. Blank forms of contracts are furnished to dealers from whom the plaintiff contemplates buying notes. The plaintiff requires a purchaser’s statement on the back of each contract. It then investigates in every instance both the maker and the indorser of the commercial paper through various commercial agencies, before buying the security.
    The approval of the paper in the present case was made in Dallas, Texas, and the purchase of it was made there; and the money was paid outside the State.
    J. Y. Isaacs, the manager of the Newport Foundry & Machine Company, was also a witness for the plaintiff. According to his testimony he sold the notes in question to the plaintiff- at Dallas, Texas, and the payment was made through a bank at Chicago,- 111. The notes were given for sale of motor trucks to Davis & Worrell and were indorsed by the Newport Foundry & Machine Company to the General .Motors Acceptance Corporation. The Newport Foundry & Machine Company was not the agent of the General Motors Acceptance Corporation, and that company did not have anything to do with the business of the Newport Foundry & Machine Company. The Newport Foundry & Machine Company made arrangements with the plaintiff for a line of credit with it. It had made a statement of its financial condition to the plaintiff and had a general line of credit based on that -statement and the investigation of its condition made by the plaintiff.
    According to the testimony of the defendants, Davis & Worrell, the sale of one of the trucks was procured by fraudulent representations. Evidence was adduced by the plaintiff to contradict this testimony. The evidence on this phase of the case will be stated more particularly in the opinion when we come to discuss the question of whether or not the sale should be set aside on account of the fraudulent representations of the seller.
    The court found the issues in favor of the plaintiff and a decree was entered accordingly.
    To reverse that decree Davis & Worrell have duly prosecuted an appeal to this court.

      Mehaffy, Bonham & Mehaffy, for appellant Davis & Worrell.
    Appellee had no capacity to sne on the notes, as it was a foreign corporation doing business in this State without having complied with the law. 128 Ark. 211. By the conduct of its business appellee has violated act 313 of Acts 1907. See 115 Ark. 166; 124 Ark. 539. The defect in the notes was inherent, and a subsequent purchaser must take notice of such defect. 136 Ark. 52.
    Appellee was not an innocent purchaser of the notes, as it knew exactly how the Newport Foundry & Machine Company conducted its business, and knew that that company was selling the trucks as new, when in fact one of them was second-hand. See cases in 121 Ark. 250; 110 Ark. 578 ; 97 Ark. 537; 105 Ark. 281.

      Boyce ■& Mach, for appellant, Newport Foundry & Machine Company.
    There was no fraud in the sale of the trucks and no misrepresentation. They were • sold under a written contract. Oral warranties or agreements could not properly be shown. 45 Ark. 284; 108 Ark. 254.

      Rogers, Barter <£ Henry, for appellee.
    The appellee was not engaged in an intrastate business. Its contracts were made and money paid in another State, thus carrying on an interstate business not subject to regulation by this State. See 57 Ark. 24; 206 Fed. Rep. 802; 55 Ark. 625; 160 U. S. 167; 92 Ala. 145; 98 Ala. 409; 54 Ark. 566.
   Hart, J.

(after stating the facts). It is first contended by counsel for Davis & Worrell, the defendants, that the plaintiff, General Motors Acceptance Corporation, is not entitled to maintain this suit because it has not complied with our statute regulating foreign corporations doing business in this State. Crawford & Moses ’ Digest, secs. 1825-32 inclusive.

It appears from the record that the plaintiff has not complied with our statute prescribing the terms upon which foreign corporations may do business in this State. It is the contention of the plaintiff that the transaction in question does not bring it within the prohibition of the statute. The statute does not specify what particular acts shall constitute doing business in this State by a foreign corporation. The general holding, however, is that the doing of business is the exercise in this State of some of the ordinary functions for which the corporation was organized. In other words, it is the actual doing or engaging in business in this State by such corporation.

In White River Lumber Co. v. Southwestern Improvement Assn., 55 Ark. 625, it was held that a foreign corporation is not doing business within the meaning of the statute by entering into a contract with a resident thereof, where the contract is made and is to be performed elsewhere.

So too in State Mutual Fire Ins. Assn. v. Brinkley Stave & Heading Co., 61 Ark. 1, it was held that a contract made with a foreign insurance company through its local soliciting agent at a place outside of the State is not doing business within the State within the meaning of the statute. These cases hold that the rule is not altered by the fact that the contracts relate to property in this State.

Again, in Scruggs v. Scottish Mortgage Co., 54 Ark. 566, it was held that a foreign corporation, in lending money on land in this State, is not doing business in the State, within the meaning of sec. 11, art. 12 of the Constitution of 1874, if the agreement for the loan was made in another State, and the notes and securities delivered and the money paid there.

In Bamberger v. Schoolfield, 160 U. S. 149, it was held that a foreign corporation is not doing business in a State by purchasing in another 'State negotiable securities executed within the’ first State.

In the application of the principle stated in the illustrative cases given above, we agree with the chancellor that the transaction in the present case does not come ■within the prohibition of our statute regulating foreign corporations doing business in this State. >•

It is true that it was a part of the business of the plaintiff corporation to discount notes of this character, and that it did discount notes purchased from about forty dealers in ¡motor vehicles in the State of Arkansas. The plaintiff was organized under the laws of the State of New York and had a branch office at Dallas, Texas, where it transacted its business with residents of the State of Arkansas.- It' furnished dealers of motor vehicles in Arkansas with whom it contemplated doing business with ’blank forms of contracts to be used by such dealers in selling their motor vehicles. There was a place on such form for the purchaser of the motor vehicle to make a statement of his financial condition. The dealer was required to send to the plaintiff at Dallas, Texas, a statement of his financial -condition, and an investigation of his financial condition was also made through reports by commercial agencies and otherwise. Then the plaintiff would agree to extend a general line of credit to such dealer. The dealer in making a sale would take the note of the purchaser on one of the blank forms furnished by the plaintiff. This was all done, however, to better enable the plaintiff to pass upon the securities offered it for discount. The plaintiff had no interest whatever in the business of the dealers from whom it bought such commercial paper. It had no established agency in this State. In each instance the paper was sent to its office in Dallas, Texas, and accepted there. The money was paid there, or through a bank in Chicago upon orders of the- home office in New York. Thus it will be seen that the contract was made and the money paid in each instance outside of the State. The applications for sale of commercial paper were received by the plaintiff at its office outside of this State. They were passed upon there and accepted or rejected there. The plaintiff had no agency in this State, and the mere fact that it acted upon applications -coming through residents in this State would not constitute doing business in this State within the meaning of the statute.

As we have said, it does not appear that the plaintiff ever had an agency in this State, and the most that can be said is that it actually accepted discounts from forty different dealers in motor vehicles. The negotiations, however, were conducted by the dealers themselves, who, although residents of this State, were not in any sense the agents of the plaintiff, and the plaintiff was not in any way connected with their business or obligated to purchase at a discount or otherwise the notes which such dealers should take for motor vehicles sold by them.

It is true that the furnishing of blank contracts to be used by the dealers in selling their motor vehicles and in purchasing the notes given for said motor vehicles tended to further the business of such dealers, but this did not make such transactions fall within the terms of the act. This would not be the controlling test. The test is, was the transaction of the business such that the corporation was for the time being, through its agents or otherwise, within the State for the purpose of doing business?

In reaching this conclusion we do not mean to say that a foreign corporation must have an agency established in this State to bring it within the operation of our statute regulating foreign corporations doing business in this State; but we do hold that in a case like this, where the foreign corporation had its place of domicile in another State and discounted commercial paper of parties with money paid out in. such other- State on applications made to it there through dealers in this State, such transactions do not constitute doing business in this State by such foreign corporation.

It is also insisted by counsel for Davis & Worrell that the decree should be reversed because -one of the motor trucks was purchased through the false representations of the Newport Foundry & Machine Company. Frank Worrell, one of the members of the firm, testified that this truck was represented to him to be a new truck, and that when he began to use it he found that it had been used for at least six months, and that some of its parts showed wear, and that it was altogether in such a defective condition that it could not be used. Two of his employees corroborated his testimony.

On the other hand, the manager of the Newport Foundry & Machine Company testified that Worrell was a man of several years’ experience in the use of motor trucks and that he made a thorough examination of the one in question before he purchased it. The truck was never repainted, as testified to by Worrell. At the request of Worrell the truck was changed so as to put a dump body upon .it, and it was probably touched up to cover up the scars made in making the change. The car was driven through the country from Newport to Imboden at the time it was purchased, but it was entirely new. An employee of the company who drove the truck through the country and delivered it, testified that it was new and all right.

The chancellor found the issue of fraudulent representations in favor of the plaintiff, and when we consider that Worrell had had several years’ experience in running motor trucks and made a thorough examination of the one in question, it can not be said that the finding of the chancellor that he was not induced to buy it by the false and fraudulent representations of the seller was against the preponderance of the evidence.

Moreover, the plaintiff purchased the note given for the purchase price of the motor truck for value before maturity, and it does not appear from the record that it had any knowledge of any false representations which induced the sale of the motor truck, if any such were made by the seller.

As we have already seen, the plaintiff was not interested in the sale of the motor trucks and had nothing whatever to do with the sale thereof.

There is .a dispute between the parties to this lawsuit as to what testimony properly appears in the record; but, inasmuch as we have accepted the abstract of the testimony made by appellants, and have reached the conclusion that the decree should be affirmed, we have decided not to go into the dispute between the parties in this respect or to consider which is right.

From the conclusions we have reached, it follows that the decree must be affirmed.


author: Smith, J.

text:
    Road Improvement District No. 3 v. Morris.
    Opinion delivered May 22, 1922.
    1. Highways — jurisdiction op chancery — to compel reassessment. — Though plaintiff may have a remedy at law by mandamus to compel a reassessment, the chancery court has jurisdiction to compel reassessment of benefits in a road improvement district organized under the Alexander law (Crawford & Moses’ Dig., § 5399 et seq.), on ground that liens on real estate are involved.
    2. Highways — improvement district — reassessment.— A complaint based on Crawford & Moses’ Dig., § 5430, held to state a case which entitles plaintiffs to a reassessment of all the lands in a road improvement district, making it the duty of the commissioners to order the same.
    3.- Highways — mode op making reassessment. — Under the Alexander Law (Crawford & Moses Dig., § 5399 et seq.) where a reassessment of benefits is ordered, it. must be made in such manner as to leave the contractual rights of third persons which have intervened undisturbed.
    4. Highways — power to order reassessment. — Under Crawford & Moses’ Dig., § 5430, providing that the board of commissioners may, not oftener than once a year, order a reassessment of benefits, the commissioners are authorized to order a reassessment of all the lands in a road improvement district.
    5 Highways — injunction against collection op assessment.— Where the reassessment of benefits of a road improvement district has been ordered, but has not yet been made and become final, an order enjoining the collection of the original assessment is premature.
    6. Highways — injunction against collecting assessment — bond, —Crawford & Moses’ Dig., § 5460, providing that no injunction shall issue to stay work on any road or the collection of any tax, unless the party applying therefor shall first give a prescribed bond', applies to suits to stay the construction of an improvement or which question the general right to collect the taxes due the district, tout does not apply to a suit of an individual property owner, who seeks a correction of his own assessment, or an adjustment or reassessment of general benefits.
    Appeal from Woodruff Chancery Court, Northern District; A. L. Hutchins, Chancellor;
    modified.
    I Harry M. Woods, for appellant.
    The chancery court is without jurisdiction to either assess or reassess the property in an improvement district. :See C. & M. Dig., sec. 5430, as to reassessments, and Johnston v. Conway, 151 Ark. 398, as to lack of jurisdiction in the chancery court. If the commissioners refuse to reassess, the remedy is by mandamus, or they may be removed. Act 303 Acts 1921.
    A bond should have been required upon the issuance of the injunction. C. & M. Dig., 5460.

      R. M. Hutchins and Coleman, Robinson <3 House, for appellees.
    Upon the showing made it became the duty of the commissioners to make a reassessment, which they promised to do, but failed to carry out the promise. The court was not asked to malee a reassessment, but merely to direct the commissioners to order one. Under the changed conditions the first assessment is arbitrary and confiscatory, entitling these property owners to relief. 141 Ark. 254; 133 Ark. 64.
    The chancery court has jurisdiction to restrain the enforcement of an arbitrary assessment. 275 Fed. 600; 147 Ark.' 547.
    The bond required by sec. 5460, C. & M. Digest, is only applicable to temporary or preliminary injunctions. The case here was determined on its merits on a final hearing.
   Smith, J.

Appellees were plaintiffs below, and filed a complaint containing substantially the following allegations: Plaintiffs are the owners of lands situated in Road Improvement District No. 3, a district organized pursuant to the provisions of act No. 338 of the Acts of 1915 (Acts 1915, page 1400), commonly known as the Alexander law, §§ 5399 et seq., C. & M. Digest. The order of the county court creating said district was made and entered on the 31st day of August, 1917. Said district was organized for the purpose of constructing the following hard roads: A road from McCrory west two miles; a road from McCrory so,uth two miles; a road from McCrory north two miles; a road from Mc-Crory east to the Cross County line, a distance of nine miles. For the purpose of constructing said roads, all the lands in the district were taxed on the basis of the estimated betterments resulting from the whole improvement. Betterments against the plaintiffs’ lands were assessed upon the assumption that the entire improve-, ment would be completed, as were all othér lands in the district. After the betterments had been so assessed, the commissioners of the district sold bonds aggregating $150,000, with the proceeds of which the roads north, south and west of McCrory were constructed, but only two miles of the road east of McCrory have been constructed, and seven miles of that road have been only partially constructed. That the dump is partially thrown up, but. the road is not in condition for use, and no benefit has accrued or will result from the partial work already done.

Plaintiffs are informed and believe that the district has exhausted its resources, and has no funds on hand, and no power to raise funds for completing the seven miles of unfinished road. The law limits the cost of the improvements to thirty per cent, of the total assessed value of the lands in the district for State and county purposes, and the cost of the work already done has reached this limit. The cost of constructing that part of the road which is already completed far exceeds the original estimate of the cost of such work. The improvement already completed is better in character and amount than called for 'by tbe original plans, and tbe benefits accruing from tbe completed improvement to tbe lands adjacent thereto far exceed the benefits assessed against said lands.

Plaintiffs allege that, by reason of the fact that the road contiguous to their lands was not in fact constructed and cannot be constructed for lack of funds and inability under the law to raise additional funds, no benefits will accrue to their lands, and that, as a matter of fact, the incomplete work of throwing up a partial dump has rendered the travel over it much more difficult, and is therefore a damage rather than a benefit. They further allege that building certain roads better than those called for by the plans exhausted the district’s funds before all the roads were built, and thus has brought about an inequality in the assessment of benefits as a whole which should be rectified by the commissioners of the district. Plaintiffs allege that, in anticipation of the completion of the improvement, they had paid taxes for two years, and had just recently ascertained that the district is without funds to complete the proposed improvement, and immediately upon obtaining that information they filed an application with the commissioners of the district for a reassessment of benefits, pursuant to § 18 of the act under which the district was organized; but the commissioners have failed and refused to readjust the assessments of benefits. Plaintiffs allege the payment of assessments for the years 1919 and 1920, and that other assessments extending over a period of twenty years are outstanding against their lands and will constitute liens thereon, in satisfaction of which the lands will be sold if relief is not afforded. Plaintiffs made no objection to the payment of their 1919 and 1920 assessments because they then assumed the plans of the district would be completed by building all the roads therein called for. It is further alleged that they have no remedy at law; that the commissioners refused to reassess the benefits; that the county clerk has extended, and the collector is now collecting, said assessments, and the said collector will, in due course, return the lands of these plaintiffs as delinquent if said assessments are not paid, and the lands will be sold. The complaint concludes with the following prayer: “Wherefore the plaintiffs pray for an order from this honorable court to the board of commissioners of the defendant road improvement district, directing them to make a reassessment of benefits on all the lands included in the district, pursuant to the authority conferred on said board by % 18 of the act under which it was established; and for an order restraining the county clerk from extending any road tax against the plaintiffs’ lands, and the collector from collecting any such tax, based on the present assessment of benefits against said lands; and for an order directing the board of commissioners to charge the plaintiffs’ lands with such sum as the tax for 1919 and 1920 would have amounted to on the basis of the readjusted assessment of benefits, and credit said lands with the amount of tax actually paid for said years. And the plantiffs hereby offer to give a good and sufficient bond, to be approved by the court, conditioned that the plaintiffs will pay the full amount of road tax that shall be found to be due from their lands, respectively, when the reassessment of benefits shall have been made, as soon as the amount of such tax is ascertained, which tax the plaintiffs hereby offer to pay. And the plaintiffs pray for such other, further and general relief as the facts may entitle them to, and to equity shall seem meet and proper.”

To the complaint the defendants filed a demurrer, which was overruled, and, as defendants refused to plead further, an order of the court was entered directing a reassessment of the betterments, pursuant to § 18 of said act No. 338 (§ 5430, C. & M. Digest), and enjoining the collection of the tax on the lands described in the complaint.

No bond was filed with the complaint; and no bond was required under the order of the court.

The defendant road district excepted, and has appealed.

Two questions are discussed and presented for our decision: First, may the chancery court order the commissioners to make a reassessment of the property? Second: Can the collection of taxes he enjoined without filing a bond, conditioned as required by § 5460, C. & M. Digest?

We think the chancery court had jurisdiction of this suit, upon the ground that it involves the enforcement of liens upon real estate. Bowman Engineering Co. v. Arkansas & Missouri Highway District, 151 Ark. 47.

In opposition to this view, the case of Johnston v. Conway, 151 Ark. 398, is pressed upon us. In that case the chancery court had itself made an assessment of betterments to pay a judgment due a contractor for the construction of a municipal improvement, and in doing so levied an assessment against the property in the district which exceeded the benefits accruing to the; property by reason of the improvement. We there held that the property owners could not be required to pay an assessment against their property for the cost of an improvement which exceeded the benefits accruing to the property by reason of such improvement. In the same case we also held that an assessment of benefits in a local improvement district, and any revision or readjustment thereof must be made by the board of assessors of the district in the manner prescribed by law, and that the chancery court was without jurisdiction to make such assessments for that purpose. The decree in that cause was reversed because it contravened both the legal propositions just stated.

Here the chancery court made no attempt to reassess the lands, but ordered that action to be done by the commissioners as assessors for the district, and the court has not, in the instant case, ordered an assessment made in excess of that authorized by law.

It is true that in the case of Johnston v. Conway, supra, we said a creditor of the district had an ample remedy at law to enforce any right he had, and that his remedy was not by action through the chancery court, and upon the remand of the cause leave was given, if the parties were so advised, to transfer the cause to the law court.

Without questioning the correctness of the directions there contained, under the facts there recited, it does not follow that a similar order must be entered in this case. We think the plaintiffs had a remedy at law by mandamus to compel the reassessment of benefits; but we are also of opinion that the relief to which plaintiffs are entitled may be worked out under the directions of the chancery court.

There are two sections of this Alexander road law which deal with the question of reassessments. The first of these is § 17 5429, C. & M. Digest), which authorizes a reassessment to conform to alterations in the plan of the improvement; and the section contains a proviso that if the district has issued bonds or other negotiable evidences of indebtedness, the total amount of the assessed benefits shall not be diminished.

The other- section, and the one under which the court ordered the commissioners to proceed, is numbered 18, (§ 5430, C. & M. Digest), and reads as follows: “§ 5430. The board of commissioners may, not oftener than once a year, order a reassessment of benefits, which shall be made, advertised, revised and confirmed as in the case of the original assessment and with like effect; but if the district shall have issued interest-bearing evidence of the debt, the total amount of the assessed benefits shall never be diminished.”

These sections were construed by this court in the case of Earle Road Improvement District No. 6 of Crittenden County v. Johnson, 145 Ark. 438. The road district in that case, as in this, was organized under the Alexander road law. At the 1919 Regular Session of the General Assembly a curative act was passed validating the organization of this district No. 6. In addition, this act (act No. 55 of the Regular Session of the General Assembly, Road Acts, volume 1, page 36) contained a section numbered 11 which provided that the commissioners of district No. 6, and those of three other districts, all organized under the Alexander law, might, “not of tener than once a year, require the assessors to reassess the benefits in said respective districts.” The same section also provided that the commissioners of road districts Nos. 7, 8 and 9 (which were districts created by another section of the act of which section 11 was a part) might, “not of tener than once a year, reassess the benefits in their respective districts; but in the event the respective districts shall have incurred indebtedness or issued bonds, the total of assessed benefits shall never be diminished.’ ’

Construing section 11 of this act No. 55 we there said: “A reasonable interpretation of the language of the statute is that it was intended to confer upon the commissioners of the district authority to order a general reassessment of the property under the restriction that the total amount of benefits should not be diminished below the amount of the obligations of the district. This interpretation of the statute is madé clear when we consider it in the light of certain sections of the general statute under which this district was originally organized.”

The court then proceeded to construe §§ 17 and 18 of the Alexander road law, in which connection it was said: “Section 17 provides, in substance, that when, by reason of a change of plans, the previous assessment of benefits has become inequitable, a new assessment may be made, and section 18 provides that the commissioners ‘may, not oftener than once a year, order a reassessment of benefits, which shall be made, advertised, revised and confirmed as in the case of the original assessment and with like effect.’ Section 18 cannot be construed as mere authority to correct inequalities in the original assessment, for that subject is fully covered by section 17. Obviously, the framers of the statute meant to create additional power in section 18 and to authorize something more than mere correction of inequalities. They meant, in other words, that there conld be a complete reassessment of the benefits to the property, with the proviso that the total amount of benefits as originally assessed should not be diminished so as to reduce the amount below the obligations of the district.

“Section 11 of the new statute, which is now under consideration, conforms' to section 18 of the general statute and authorizes a general reassessment. The term ‘reassessment’ necessarily implies a new assessment or to assess again, and it does not refer to particualr pieces of property, but to all the property in the district. ’ ’

Upon this interpretation the court announced its conclusion to be that the commissioners of the district were acting within their legal powers in ordering a reassessment.

It is true that in the case from which we have just quoted there was a special act, and we have set out its provisions ; but it appears that the special act did not substantially enlarge the powers conferred on the commissioners by the general statute; and we conclude here, as we did there, that the commissioners have the legal power to order a reassessment, and under the allegations of the complaint it is their duty to do so.

It does not follow, however, that the injunction in this cause was properly granted. Upon the contrary, we think it was prematurely ordered. This reassessment has been ordered, but it has not yet been made. It must be “made, advertised, revised and confirmed as in the case of the original assessment and with like effect;” and, inasmuch as interest-bearing evidences of debt have been issued, the total amount of the assessed benefits may not be diminished. Section 5430, C. & M. Digest.

The existing assessment must therefore be permitted to stand until the reassessment has been made and has become final. The outstanding obligations of the district are based upon the original assessment, and the proceedings to collect thereunder could not be enjoined until that assessment has been fully superseded by another assessment which meets the requirements of the law permitting the reassessment to be made.

It follows therefore that, while the court properly ordered a reassessment, the order restraining the collection of assessments was prematurely made and must be dissolved.

Section 5460, C. & M. Digest (which was § 41 of the Alexander road law), provides that “no injunction or process shall issue to stay the work on any road, or the collection of any tax thereunder, * * * unless the party applying therefor shall first enter into bond with good and sufficient security, to be approved by the court or judge granting same, and payable to the board of commissioners for the benefit of said district in double the.amount already expended on the establishment of the district and outstanding contracts, said bond to be conditioned for the payment of such amount, if said injunction is wrongfully granted, nor shall any injunction be granted except on ten days’ written notice to the president of the board of commissioners, which notice shall state the time and place of the intended application for said injunction. Any injunction issued by any court, unless the foregoing terms have been complied with, shall be void.”

It is obvious that the provisions of the section just quoted apply to suits which seek to stay the' construction of an improvement, or which questions the general right to collect the taxes due the district, and that it does not apply to the suit of individual property owners who seek a correction of their own assessments or an' adjustment or reassessment of the general benefits.

Moreover, as we have said, the injunction, in this case prematurely issued, and, as it must be dissolved, there is no occasion for a bond, even though the section quoted applied to suits of this character.

It follows therefore that, under the case made by the pleadings, the plaintiffs are entitled to have a reassessment of benefits by the commissioners; but until that reassessment has been made the collection of the old assessments should not be suspended, and the injunction ordering this done is dissolved.


text:
    Smith v. State.
    Opinion delivered May 22, 1922.
    1. Perjury — false testimony before grand jury. — In a prosecution for perjury in which it was claimed that defendant gave false testimony before the grand jury, testimony of the foreman of the grand jury as to the testimony given by the defendant in which he used the expression “If I remember right” and “It is my belief”, ■ and the testimony of another witness aa .to what defendant swore in which the witness used the exr pressions “My recollection is”, and “I am of the impression”, held sufficient to make the question as to what defendant testified before the grand jury one for the jury.
    2. Perjury — false testimony — materiality.—False testimony before the grand jury considering a charge against certain persons for larceny that the witness did not on the day before the examining trial attempt to compromise or settle the case against such persons held perjury; the false testimony being material as being calculated to suppress inquiry as to whether such persons had authorized the witness to suppress the examining trial.
    8. Criminal law — invited error. — Defendant could not, on appeal, complain of the admission by the trial court of a written memorandum in evidence where he objected to oral testimony to the same effect on the ground that the memorandum was the best evidence of the facts.
    4. Criminal law — question for jury. — Credibility of a witness is a question for the jury.
    Appeal from Polk Circuit Court, James 8. Steel, Judge;
    affirmed.

      Minor Piptem, for appelant.

      J. 8. Utley, Attorney General, and Elbert Godwin and W. T. Hammoclc, for appellee.
   Smith, J.

Appelant was convicted of perjury, and bias appealed. For the reversal of the judgment he insists that the verdict was contrary to the evidence; and that the alleged false testimony was not material.

The indictment alleges that the grand jury was engaged in the examination of a charge against Jess Nichols and Harvey Jane for the larceny of certain meat, and that pending such examination witness testified “that he did not, on the day prior to the examining trial of the case against the said Nichols and Jane, attempt to compromise or settle said case, which was then and there pending in justice court, with Mrs. Bud Biokle, and did not ask her if she would settle the case if she should be paid $75, or any other amount.” The indictment alleges the materiality and the falsity of the testimony.

The foreman of the grand jury testified, and in doing so made use of such expressions as “If I remember right”, and “It is my belief”. These statements were made in repeating the testimony of appellant before the grand jury. The deputy prosecuting attorney also testified in the case, and in doing so he used the expression, “My recollection is”, and “I am of the impression.”

It is insisted that the use of these and other similar expressions of the witnesses shows that the witnesses were not sufficiently certain and definite to meet the requirements of the law. But this was a question of fact for the jury, and the jury’s verdict is conclusive of the question.

The chief insistence is that the alleged false testimony was immaterial. It is said that the testimony could not have been offered at the trial of Nichols and Jane upon the charge of larceny, in the absence of a showing that these persons had authorized appellant to make the proposition to Mrs. Biokle.

It is to be remembered, however, that the false testimony was given before the grand jury, a body having general inquisitorial powers, and the allegation of the indictment is that appellant was interrogated about an incident which had occurred the day before the examining trial of Nichols and Jane before the justice of the peace. The denial by appellant that he had made Mrs. Bickle an offer to settle the case would probably and naturally have tended to close the inquiry about the offer of money to settle the prosecution; whereas a truthful answer to that question and an admission that he had made such an offer would naturally have led to the inquiry, at whose instance the offer was made, and, if it had been made at the instance of Jane or Nichols, that fact would have been developed by the grand jury. The false answer was calculated to suppress the inquiry whether Nichols and Jane had authorized or induced appellant to attempt to suppress the examining trial. False swearing under these circumstances is perjury. In the case of Smith v. State, 91 Ark. 200, a syllabus reads as follows: “In an investigation before a grand jury any testimony is material whose necessary effect is to suspend, if not prevent, further investigation of a subject of inquiry, as where defendant’s false testimony prevented the grand jury from investigating whether liquors in a given instance had been sold illegally. ’ ’

Error is assigned in admitting in evidence a written memorandum of the appellant’s testimony before the grand jury. If there was any error in admitting this writing, it was invited, as objection was made to the testimony of both the foreman of the grand jury and the deputy prosecuting attorney that there was a memorandum which would be the best evidence. This memorandum was identified by the deputy prosecuting attorney as having been made by him; and, while it is not identical with the testimony of that officer at the trial, we think there was no substantial difference between the recitals of the memorandum and the testimony of that officer. At any rate, the difference, if any, was a question going to the credibility of the witness, and that was a question for the jury.

No error appearing, the judgment is affirmed.


author: Humphreys, J:

text:
    Nicholas v. Bright.
    Opinion delivered May 22, 1922.
    1. Appeal and error — appeal prom order transferring cause.— An order transferring a cause from the circuit court to the chancery court is not a final order or judgment from which an appeal can be taken.
    2. Trial — cross-complaint—direction op verdict. — In an action ■on a note where defendant prayed for judgment over against third persons claimed by him to have agreed to pay the'note, but it was admitted that the note was his personal obligation, and he offered no evidence to establish his claim against such third persons, the court did not err in directing a verdict for plaintiff.
    Appeal from Arkansas Circuit Court, Southern District ; George W. Glarh, Judge;
    affirmed.

      Botts & 0’Daniel, for appellant.

      Rose, Hemingway, Cantrell S Loughborough, for appellee, Bright.
    1. Appellant’s answer-does not deny the execution and delivery of the note to Bright, nor that it was past due and unpaid. The court’s instruction was right. 133 Ark. 105, 111. A corporation is hound only by its own contracts, not by members thereof acting -in their private capacity. 37 Ark. 164.
    2. After Lambert, Roan and Hollis, by their consent, were made parties, it was not proper to transfer the entire cause to equity. Bright’s action could not be delayed by an independent controversy between appellant and these parties. C. & M. Digest, § 1204, subdiv. 3. The eross-cocmplaint was no defense against the original complaint. 31 Ark. 345, 349.

      3. There was. no error in withdrawing* the ease from the jury and directing* the verdict for the plaintiff against Nicholas. 75 S. E. 588; 73 Ark. 561; 76 Id. 520; 89 Id. 24; 97 Id. 438; 103 Id. 401; 104 Id. 267; 67 Id. 147; 90 Id. 439.
    4. And the cause was properly transferred to equity for disposition of the issues ibetween Nicholas and the other parties. 36 Ark. 228, 236.
   Humphreys, J:

Appellee, R. C. Bright, instituted suit against appellant, J. P. Nicholas, in the Arkansas County Circuit Court, Southern District, to recover $593.78, upon the following promissory note:

“■Stuttgart, Ark., September 1, 1917.
“Sixty days after date, for value received, I promise to pay to the order of R. C. Bright $500 five hundred and no-100 dollars. Payable at the Southern Trust Company, Little Rock, Ark., with interest at the rate of eight per cent, per annum from date until paid. Interest payable semi-annually, or to become as principal and bear same rate of interest. The makers and endorsers severally waive presentment and protest.
“(Signed) J. P. Nicholas.”

Appellant interposed the defense that, while he signed the note individually, it was in fact not his obligation but the obligation of the Nicholas P-ump & Well Company, which had been* organized to take over the assets and liabilities of the Nicholas-Brown Pump & Well Company, theretofore operating in said county; that M. C. Hollis, Albert Lambert and Prank Roan were promoters of the Nicholas Pump & Well Company and became stockholders therein and agreed to finance said corporation; that in process of the formation of said corportion it became necessary to have $500 with which to pay the labor bills and pressing accounts of the Nicholas-Brown Pump & Well Company; that it was agreed by all the parties to the new corporation that appellant should sign the note, but that Hollis, Lambert and Roan should advance the money to pay it; that appellee R. C. Bright knew of and acquiesced in the arrangement; that, after the new corporation was organized, the old corporation, of which appellant was manager, turned over to the new corporation accounts, tools, shop, pump, well material and construction contracts worth $20,000; that Hollis, Lambert and Roan refused to furnish capital for the new corporation, which prevented it from operating, to appellant’s damage in the sum of $10,000. Appellant prayed that his answer be treated as a cross-bill against M. C. Hollis, Albert Lambert and Frank Roan, and for judgment over against them for said sum, and for the amount of the note in case R. C. Bright should recover personal judgment thereon against him. By consent M. C. Hollis, Albert Lambert and Frank Roan were made parties, and M. C. Hollis filed a separate answer denying that he was indebted to appellant growing out of the organization of the Nicholas Pump & Well Company, or upon the note executed by appellant to appellee R. C. Bright, stating that at the request of Nicholas, who was badly in need of funds, he telephoned R. C. Bright, who was a very close personal friend, requesting him to loan the appellant $500, which was done; that it was not his obligation, or the obligation of the new corporation, as alleged in appellant’s cross-complaint.

The cause was submitted upon the pleadings and evidence, which. resulted in a directed verdict in favor of appellee R. C. Bright against appellant for' the amount of the note, together with interest and costs, and a transfer of the cause upon the cross-complaint to the chancery court, from which is this appeal.

The undisputed evidence showed that appellee R. C. Bright had no connection whatever with either the old or new corporation; that he knew nothing concerning the transaction between the corporation, or between appellant, Hollis, Lambert and Roan, with reference to the organization of the new corporation or the purposes for which it was organized; that he loaned $500 to appellant through the recommendation of M. O. Hollis; that Hollia ’phoned him that Nicholas wanted $500, stating what security he could give; that he authorized Hollis to take a note and mortgage on a rice crop and draw draft on him in favor of J. P. Nicholas, with note and mortgage attached; that some thirty days after the note was executed appellee E. O. Bright was informed that the Nicholas Pump & Well Company had been organized to take over the business of the old corporation, and was invited to take stock in it, which he declined to do. Testimony was introduced responsive to the issue joined upon the cross-complaint and answer thereto, which appellant claims conclusively established his right to judgment against the defendants in his cross-bill. We deem it unnecessary to set out or discuss this evidence, as his cause of action upon his cross-complaint was transferred to the chancery court. It is true the cause was transferred over appellant’s objection, but it was not a final order or judgment from which an appeal could be taken. This court said, in the case of Womack v. Connor, 74 Ark. 352, concerning an order transferring a case from the chancery to the circuit court, that “the order of transfer to the circuit court affects a substantial right in the action, but it is not such an order as determines in effect the action, and prevents a judgment from which an appeal might be taken. The order does not discontinue the action; it discontinues it in the chancery court, but the action under the order continues in the circuit court until it is disposed of there. The order does not abate the action; it merely transfers it to another forum. * * * * If the order of the court is erroneous, it can 'be corrected on appeal from the final judgment when taken.”

Appellant contends that the judgment in favor of appellee against him should be reversed because the court, in the midst of the evidence, peremptorily instructed the jury and thereby prevented appellant from developing the issues fully between appellee and appellant. There is nothing in the record to indicate whether the evidence had been closed when the court instructed a verdict for appellee in the amount claimed. The transcript shows that, just after J. P. Nicholas was asked, on cross examination, whether the note sued upon was his personal obligation to Bright, which question was answered by him in the affirmative, the court instructed the verdict, and that thereupon counsel for the appellant objected and excepted to the ruling of the court. The objection was general, and not specific. The court was not informed that appellant had further testimony to introduce responsive to the issue between appellant and appellee; nor did appellant offer to introduce further testimony tending to establish the defense interposed by him. All the parties to and connected with the execution of the note had testified fully. There was no conflict in their evidence, and the effect thereof showed that the note was the personal obligation of appellant, J. P. Nicholas, so far as R. C. Bright, the payee, was concerned. The issue joined in the cross-complaint and answer thereto was independent of and collateral to the issue joined in the original complaint and answer thereto. This being so, it was not error to render a judgment upon the main issue, as it did not in any wise prejudice the rights of the parties in the cross-complaint. It is provided in the third subdivision of section 1204 of Crawford & Moses’ Digest that “the filing and prosecution of the cross-complaint shall not delay the trial and decision of the original action, when a judgment can be rendered therein that will not prejudice the rights of the parties to the cross-complaint.”

The judgment is therefore affirmed.