author: Smith, J.

text:
    Martin v. Street Improvement District No. 349.
    Opinion delivered December 10, 1928.

      June P. Wooten, for appellant.

      P. L. Robinson and Lewis Rhoton, for appellee.
   Smith, J.

Appellant ¡brought suit at law against the Marshall 'Street Annex of Street Improvement District No. 349 of Little Rock to recover fees alleged to he due him as attorney for the annex district and for certain court costs which he alleged he had expended in its behalf.

The commissioners of the improvement district waived service of summons, and entered their appearance and confessed judgment for the amount sued for, and judgment was rendered by consent for $7,733. This judgment was rendered September 30, 1927. On October 3, 1927, Herman Heiden filed an intervention, in which he alleg’ed that he was a property owner in the Marshall Street Annex improvement district, and that the judgment against the district had been 'obtained through collusion and fraud between the plaintiff attorney and the commissioners; that judgment had been rendered by consent on the day on which the complaint had been filed, and that the existence of the suit was concealed from all property owners in the district; that' plaintiff had caused the original District No. 349 to be organized in 1923, and secured the appointment of defendants as commissioners, who became his agents, and allowed him grossly excessive fees, and that an audit of the original district and the annex thereto showed that the defendant commissioners had obligated the district to pay the plaintiff a fee -of $12,288.84 and the annex to pay $7,733, and that intervener, on behalf of himself and other property owners, had a meritorious defense to said claims, in that they are grossly excessive.

The court granted the prayer of the intervener on the same day the intervention was filed, and set aside the judgment previously rendered.

It is insisted that this order was error, for the reason that no summons was served on appellant and no testimony was heard by the court, and therefore no good 'cause for setting aside the judgment was shown. It appears, however, that appellant appeared and resisted the prayer of the intervention, and that the order was made after argument of‘counsel. No answer or response was filed to the allegations of the intervention, and the matter was no doubt treated as having been heard by the court on demurrer. The allegations of the petition alleged sufficient grounds-to warrant the court in setting aside a judgment which .had been rendered at the same term. In the case of T. J. Moss Tie Co. v. Miller, 169 Ark. 657, 276 S. W. 586, it was said that it was the settled policy of this State that, during their respective terms, courts of record have complete control over their judgments and decrees, and may review and correct any mistake or error into which they may have fallen during the term, hut that this power will he exercised only when good cause so to do is shown. We conclude therefore that no error was committed in vacating the judgment.

After the judgment had been vacated, an answer and cross-complaint was tiled. This pleading reviews the history of the original district and the annexes thereto; but we do not set out these recitals, as’we consider them immaterial to a determination of the only issue in this case, which is the amount of fee to which appellant is entitled. It was alleged, however, in the answer and cross-complaint that appellant had been paid a fee by the original district of $1,580.30, and by the first annex of $4,628.56, and had received in addition from the annex a certificate of indebtedness' of $5,000, which amounts were exorbitant; that two years after the organization of the original district and its first annex thereto the commissioners organized the Marshall ¡Street Annex and issued to appellant the certificates of indebtedness upon which the original suit was based.

The allegations in regard to the fees paid appellant are somewhat confusing, but in the cross-complaint it was alleged that $2,770.68 had been paid appellant as fees in the original district, and that the same were excessive; that the commissioners had paid to appellant, as attorney for the Summit Avenue, or first, annex the sum of $6,273.06, which fee was alleged to be grossly excessive.

It thus appears, under the allegations of the answer and cross-complaint, that the fees of appellant in both the original district and the two annexes thereto are called into question, and it is insisted that it was error for the trial court to hear these'issues in a single case. It does not appear, however, that the question of the misjoinder of these causes of action was raised prior to the filing of the motion for a new trial, which was, of course, too late to complain of the alleged error; but, as the judgment must be reversed for another reason, and as the question may be raised in apt time upon the remand, we take occasion to say that there was no abuse of discretion on the part of the trial court in permitting the consolidation of these cases. While the districts were separate entities, two of them were organized as annexes to the original district, and the same commissioners served for all and the affairs of the three were intimately related.

Separate verdicts were returned as follows: In favor of appellant for $600 against the Marshall Street annex; in favor of the original district against appellant in the sum of $2,270.68; and in favor of the Summit Avenue Annex against appellant in the sum of $5,523.06, and judgments were rendered accordingly.

These judgments must be reversed because much incompetent testimony was admitted over the objection of appellant, most of this incompetent testimony being offered in the attempt to show collusion and fraud between appellant and the original commissioners in the organization of the districts.

We do not review the various assignments of error relating to this testimony, but content ourselves with an announcement of the principles of law under which the case should be tried upon the remand of the cause. We are of the opinion that the testimony is insufficient to support the charge of fraud between appellant and the commissioners of the original district; but we are also of the opinion that the testimony is sufficient to support the finding that the fees allowed were grossly excessive, and the cause will be submitted upon this issue upon the remand. We take occasion therefore to restate the applicable legal principles which will be applied in the determination of this question.

In the case of Davis v. Cook, 159 Ark. 91, 251 S. W. 693, we quoted from the case of Bowman Engineering Co. v. Ark. Mo. Highway Dist., 151 Ark. 56, 235 S. W. 402, as follows:

“The commissioners have -power to make contracts, but they are trustees of the property owners, and can only make reasonable ones. The owners of the property have a right to. challenge the validity of such contracts by showing that they are unreasonable. Of course, in testing the validity of such contracts, the court should not substitute its own judgment primarily for that of the commissioners, the authority to make the contract being lodged by the lawmakers in the commissioners, but the inquiry of the court is to determine whether or not the contract is so improvident as to demonstrate its unreasonableness. ’ ’

As the commissioners had the right to contract with appellant in regard to his fee as attorney, their contract is binding unless it be found that the contract was so improvident as to demonstrate its unreasonableness, and unless and until its improvidence be first found as a fact, the question of its reasonableness does not arise. In other words, the contract between the attorney and the commissioners must be enforced unless it be found that it is so improvident as to demonstrate its unreasonableness. When this finding is made, the contract is treated as being void, as it would be in the case of actual fraud, and in such case the recovery would be on a quantum meruit basis.

There is some testimony to the effect that, as to a part, if not all, of the services performed by appellant, no contract had been previously made as to the amount of the -compensation. As to any such services- the jury will determine, as an original proposition, the value thereof. In other words, our cases appear to- distinguish between the contracts of these gwas-i-publi-e officials where an agreement was had as to the compensation before the service was performed, as in the Bowman Engineering Company case, supra, and those where the compensa.tioiL was not fixed until after the service had been performed. The case of Bayou Meto Drainage District v. Chapline, 143 Ark. 452, 220 S. W. 807, is an example of the, latter class. There was involved in the Chapline case the question of the fee of the attorney for a drainage district, it being asserted on the one hand, and denied on the other, that the fee had 'been fixed by contract before the professional services were rendered. It was there said:

“Moreover, under the undisputed evidence in this case the commissioners did not fix the fee of the appellees until after the services which they had been employed to render had all been performed. The compensation for their services was fixed by the board at the time they were discharged, not when they were employed. The preponderance of the evidence shows that the appellees were employed, and that the compensation to be paid for their services was not stipulated in advance. The appellees are therefore entitled to recover upon quantum meruit.”

Upon the remand and retrial the court should therefore instruct the jury that, if no fee was agreed upon before the service was rendered, the jury should, from the testimony, fix the fee at what appeared to be a fair and reasonable compensation for the service rendered. But if the fee was fixed by a contract before the service was rendered, the contract must be respected and enforced, unless the testimony shows the contract to be so improvident as to demonstrate its unreasonableness; but if that fact is found fo exist, then the fee should 'be fixed as if there had been no contract.

The rule for determining what a proper attorney’s fee should be where the recovery is fixed upon a quantum meruit basis was discussed and declared in the case of Sain v. Bogle, 122 Ark. 14, 182 S. W. 515, an improvement district case, and need not be repeated here.

In opposition to the allegation of the cross-complaint and the testimony offered in support of it, that appellailt had been paid excessive fees, appellant pleaded the three-year statute of -limitations as to all payments which had been made more than three years prior to the filing of the -cross-complaint. The court held that this was a valid defense, unless there was fraud in the -contract, in which event the statute of limitations would not begin to run until the discovery -of the fraud. But, as we have said, the testimony was not sufficient to wmrrant the submission -of the question whether the execution of the contract was procured by fraud, so that the -court should charge the jury that there could be no recovery of any sums of money -paid appellant mo-re than three years prior to the filing of the cross-complaint. The testimony in regard to these payments is competent, however, in determining' whether or not appellant has received a fair and just -compensation for his services.

The testimony is conflicting as to- the sums paid appellant. This is a question of fact, and appellant should be -charged with all sums of money paid or received by him, and if this amount, whatever it is, is found to exceed the fee to which appellant is entitled, a judgment should be rendered against him for the excess.

There is conflicting testimony as to an item of $1,500 in the fee claimed by appellant, there being some testimony that this item was intended to compensate appellant for procuring- the enactment of legislation by the General Assembly favorable to one of the districts.

The cases of Miller County Highway & Bridge Dist. v. Cook, 134 Ark. 328, 204 S. W. 420, and Gould v. Sanford, 155 Ark. 304, 244 S. W. 443, declare the law applicable to contracts in regard to procuring legislation. In the first-mentioned -ease it was held that the board of improvement of an improvement district is without authority to pay money to persons by way of expenses in procuring the. passage of a bill for the creation of the district. In the last-mentioned case it was held that the employment of an attorney by an improvement district to prepare a bill for legislative enactment does not contravene any rule of public policy. The court will apply these principles in regard to this item.

The cause will be remanded, with directions to submit to the jury the question of the fee to which appellant is entitled under instructions conforming to the law as herein declared, and the testimony will be confined to that issue.


source: Caselaw Access Project

author: Hart, C. J.,

license: Public Domain

text:
    Magnolia Petroleum Company v. McFall.
    Opinion delivered December 10, 1928.

      Cockrill & Armisteacl, for appellant.

      Peyton D. Moncrief, A. G. Meehan and John W. Moncrief, for appellee.
   Hart, C. J.,

(after stating the facts). The circuit court erred in not directing a verdict for the defendant as requested by it.

. In a case-note to L. R. A., at page 1060, it is said in the case of joint tort-feasors the essential unity of the injury and the fact that the injured party is entitled to but one compensation therefor make it impossible for the injured person to settle wi,th one tort-feasor without discharging the other. Therefore it is held that a release of one tort-feasior releases all, for the reason that the cause of action is satisfied, and no longer exists. Numerous State and Federal decisions are cited, 'and among them the following: Montgomery v. Erwin, 24 Ark. 540; Jones v. Chism, 73 Ark. 14, 83 S. W. 315.

In the later case of Coleman v. Gulf Refining Company of Louisiana, 172 Ark. 428, 289 S. W. 2, it was held that, where the concurrent negligence of two persons was responsible for an injury to' a third person, a settlement by the latter of an action for such injury with one of them will bar an action against the other, although the defendants in the respective actions were not joint tortfeasors. That this holding is in accord with .the general ■rule on the subject will be seen by reference to .the case-note in '50 A. L. R., at page 1099.

It is sought by counsel for the plaintiff to uphold the judgment on the ground that the execution of the release was procured by fraud. There are two reasons why this view cannot be accepted. In the first place, the railway company is not made a party to this action, and no- attempt has been made by the plaintiff to rescind the contract for a release of damages which he executed in favor of that company. In the second place, the evidence fails to establish any 'fraud on the__ part of the railway company whereby the plaintiff was induced to sign the release of damages. The' plaintiff was thirty-nine years old, and had been employed by the railway company for eighteen years. He was not an illiterate person, and gave no reason why he did not read over the contract for the release of damages, except that the agent told him that it was only payment for his expenses and loss of time. He was not induced to sign the release without reading it by false representations' on the part of the claim agent of the railway company, as was the case in St. Louis, Iron Mountain & Southern Railway Company v. Reilly, 110 Ark. 182, 161 S. W. 1052, and in St. Louis, Iron Mountain & Southern Railway Company v. Morgan, 115 Ark. 529, 171 S. W. 1187. Plaintiff does state that the claim agent of the railway company told him that signing the release contract in favor of the railway company would not prevent him from suing the defendant in this action. This was merely an expression of opinion on the part of-the claim agent, and was not made as a matter of inducement to the plaintiff to sign the release contract. A mistake of law, in the-absence of fraud -or undue influence, does not afford ground for the abrogation or reformation of a contract. Security Life Ins. Co. v. Leeper, 171 Ark. 77, 284 S. W. 12.

It follows that the court erred in not directing a verdict for the defendant, as requested by it, and for that error the judgment must be reversed; and, inasmuch as the cause of action seems to be fully developed, it will be dismissed here.


text:
    Riceland Petroleum Company v. Moore.
    Opinion delivered December 10, 1928.

      J. A. Sherrill, for appellant.

      George M. Chapline, for appellee.
   Smith, J.

Appellee was engaged in selling dental supplies, and he drove a small automobile over the State in calling on his customers. On November 11, 1927, as he was driving from Stuttgart to Pine Bluff, he had a collision with a truck which was being- driven in the opposite direction, belonging to appellant, and driven by Joe Campbell, as a result of which he sustained a very serious injury, and from the judgment awarding him damages to compensate his injury is this appeal.

As is usual in cases of this character, each party excused himself and blamed the other. The testimony is in hopeless conflict, but that offered on behalf of appellee was to the effect that, as he drove along’ the road, a colored man named Childs, who was walking in the same direction, and on the same side of the road, crossed over to the opposite side of the road, and, as the truck approached, being driven rapidly, Childs started back across the road, and Campbell turned his truck to his left and ran over on that side of the road, and in doing so ran into appellee’s car. It was appellee’s theory that, if Campbell had had his truck under control, or had remained on the right-hand side of the road, the collision would not have occurred, and that the collision did not occur until after the truck had been driven past the colored man.

Campbell denied that he was driving rapidly or that his truck was out of control. He testified that he saw Childs, and that no collision would have occurred had Childs not attempted to cross over to the opposite side of the road, which put him on Campbell’s side, and, as Childs did this, witness turned his truck to the right, but, fearing that he would drive into the ditch and on top of Childs, he turned the truck back to the left, and, as he did so, Childs also started back across the road. Witness, seeing that he was about to strike Childs, turned further to the left to avoid striking Childs, and witness admitted that he knew, when he did this, he would collide with appellee’s car, but, in the emergency thus created, he had to run over the man or run into the car, and he thought it better to strike the car than to run over the man. That, at the time of the collision, he was going very slow, having applied his brakes, and the colored man was not over three feet from his radiator when he bumped into appellee’s car.

Oscar Sellig, who was riding in the truck, testified that when Childs came back across the road he was not over ten or twenty feet from the truck, and that Campbell turned first to the right and then to the left to dodge Childs, who also turned in the same directions, and that, if Campbell had not struck appellee’s car, he would have struck the colored man.

Childs testified that he was walking on- the right-hand side of the road, and saw the truck approach on the opposite side of the road, and that he did not know about the car behind him (appellee’s ear) until it was within about ten feet of him; that appellee’s car frightened him, and he jumped over to the other side of the road, and, as he did so, Campbell turned the truck' towards the ditch, and witness then turned back the other way, and so did Campbell; that neither ear was running at an excessive speed; that he was frightened when he discovered the .car behind him, and tried to get out of the way.

Over appellee’s objection the court gave instructions numbered 3 and 4, reading as follows:

“No. 3. For the mutual protection of travelers upon a public highway, certain rules have grown up by custom through long continued use and practice, and are crystallized into law under which is designated in the books as ‘the law of the road.’ One of these rules is that travelers in meeting shall each bear or keep to the right. Travelers owe to each other the reciprocal duty of observing these rules, and a failure to exercise ordinary care to observe them, resulting in injury to another, will constitute actionable negligence.

“No. 4. You are instructed that, if you find from the evidence in this case that the plaintiff, L. C. Moore, on the 11th day of November, 1927, was traveling in his automobile on the highway going from Stuttgart to Pine Bluff, and that he met Joe Campbell, an agent of the Riceland Petroleum Company, in a car of said company, and on business of said company, going from Pine Bluff to Stuttgart, arid that the plaintiff was on the right-hand side of said road, and that defendant left the side of the road traveled by him, being the right-hand -side, and negligently, carelessly, recklessly or purposely ran into the automobile occupied by the plaintiff, then he would be guilty of negligence, and the plaintiff would be entitled to judgment for all damages sustained to his car and by him personally.”

It is earnestly insisted that these instructions were erroneous and that the court erred in ’giving them.

Instruction numbered 3 is based upon the case of Carter v. Brown, 136 Ark. 31, 206 S. W. 73, where ¡the court declared the law of the road to be “that travelers in meeting shall each bear or keep to the right,” but the court there said that this rule is not an inflexible one, and that “emergencies may arise where, in order to escape from danger to one’s self or to prevent injury to others, it will be not only excusable but perfectly proper to temporarily violate the general rule.”

Appellant insists that instruction numbered 3 ignores this exception, and permits a recovery upon the mere finding that the collision occurred while Campbell was over on the left side of the road, and we think the instruction is open to this objection, and that it is erroneous in this respect.

According to appellee, there was no emergency except that arising- from Campbell’s negligence in driving rapidly and in not putting his truck under control after he saw or should have seen that Childs was in a position of danger, and appellee insists that there would even then have been no collision had Campbell stayed upon his own side of the road.

It is the law, as was said in the case of Wells v. Shepard, 135 Ark. 466, 205 S. W. 806, that “one cannot shield himself behind an emergency created by his own negligence;” but the testimony presents the question whether Campbell’s negligence created the emergency which prompted him to violate the abstract general rule of the road requiring him to keep to the right. If Campbell’s negligence produced the emergency under which he acted, he is liable for the consequences of his act, for at last it would be his negligence which caused the injury. But, if Campbell’s negligence did not cause the emergency, the jury should be permitted to say whether, under the circumstances, Campbell was negligent in driving on the left side of the road.

In this connection it should be said that, if appellee was guilty of negligence'causing or contributing to his injury, he cannot recover.

Instruction numbered 4 told the jury that if Campbell, “being on the right-hand side, negligently, carelessly, recklessly or purposely ran into the automobile occupied by the' plaintiff, then he would be guilty of negligence, and the plaintiff would be entitled to judgment for all damages sustained to his oar and by him personally.”

Specific objection was made to the portion of this instruction which told the jury that plaintiff should recover if defendant purposely ran into appellee’s automobile, there being no testimony to show that Campbell had acted maliciously, and it being admitted by him that he drove into the car to avoid striking the man.

"What was said about instruction numbered 3 is applicable here. If Campbell was not otherwise negligent, negligence cannot be predicated upon the fact that Campbell chose to strike the car rather than the man when one collision or the other was unavoidable. If Campbell’s negligence rendered it necessary for him to make this choice, he is liable for the damages resulting from Ms choice, for the reason that “one cannot shield himself behind an emergency created by his own negligence;” but, if Campbell was not guilty of negligence producing the emergency, he would not be liable for the consequences of his choice, unless there was negligence in making his choice, a contention which is not here made.

For the error in giving instructions numbered 3 and 4 the judgment must be reversed, and it is so ordered.


author: Humphreys, J.

text:
    Gipson v. No Fence District No. 2, Lincoln County.
    Opinion delivered December 10, 1928.

      N. W. Shelton, for appellant.

      A. J. Johnson, for appellee.
   Humphreys, J.

This suit was brought by appellants against appellees, in the chancery court of Lincoln County, to obtain a new trial in an action tried in the circuit court of said county between the same parties at the May term, 1927. The judgment rendered at the May term of the circuit court appears to have been a consent judgment affirming a county court judgment creating and establishing No Fence District No. 2 in Lincoln County, Arkansas, and appointing E. P. Ladd, T. S. Lovett and A. J. Moore commissioners thereof.

The complaint alleged, in substance, that the consent judgment in the circuit court was obtained through fraud, without the knowledge of appellants, and that, immediately upon the discovery that such judgment had been rendered, they notified appellees that they would file a motion at the September, 1927, term of said court to vacate same; that, pursuant to the notice, they filed the motion on September 8, 1927, to which a demurrer was sustained on September 15, 1927; that on September 19, 1927, they filed a motion for a new trial, but the circuit court adjourned without disposing of same.

In addition, the record reflects that the September, 1927, term of the circuit court convened on September 12 and finally adjourned December 1, 3927.

The chancery court refused to hear proof offered by appellants responsive to the allegations of the complaint, and dismissed same, over their objection and exception. The' allegation in the complaint relative to the adjournment of the circuit court without disposing of their motion for a new trial is as follows:

“That within three days after the rendition of said judgment at said 'September term of 1927, the appellants filed their motion for a new trial, and, without disposing of said motion, the court lapsed and dispersed. Appellants allege that the failure of the court to dispose of their motion for a new trial at the September term, 1927, was an accident over which they had no control, but that by reason thereof appellants were deprived of their constitutional right of appeal, and were without remedy in the premises, except by the intervention of a court' of chancery. ’ ’

We think the complaint was properly dismissed by the chancery court. According to the final adjourning order of the 'September, 1927, term of the circuit court of Lincoln County, the adjournment did not occur for over two months after appellants filed their motion for a new trial. ’ Courts of equity will not interpose and grant new trials in courts of law under its inherent and ancient power for relief against fraud, accident or mistake, if the party asking relief was guilty of negligence. This is the substance of the rule announced and adhered to by this court, as may be seen by reference to the eases of Leigh v. Armond, 25 Ark. 123, and Jackson v. Woodruff, 57 Ark. 599, 22 S. W. 566. Appellants allege that the court adjourned through no fault of theirs, without ruling’ on their motion for a new trial, but they had ample time to procure a ruling thereon had they been diligent. Diligence on their part was not alleged.

The judgment is therefore affirmed.


text:
    Woodruff County v. White.
    Opinion delivered December 10, 1928.

      Roy D. Campbell, for appellant.

      Ross Mathis, for appellee.
   Humphreys, J.

Appellee is a duly elected road overseer of 'Cotton Plant Township, in Woodruff County. He presented five accounts to the county court for allowance, covering" items for teams, labor and overseer’s per diem. The accounts specified the dates on which the teams were worked and the amounts eharg*ed for each, but did not designate whose teams they were. They also specified the dates the overseer supervised the work. The several amounts were as follows: $87, $357.50, $6, $102, and $50. Each claim was disallowed on the ground that the work was not authorized by the county court and that the overseer was notified by the county judge not to do the work.

An appeal from each disallowance was taken to the circuit court of said‘county, Southern District, and was consolidated 'and tried as one cause before the court sitting as a jury, upon the testimony adduced by the parties, resulting in a general finding that the work had been done, land the rendition of a judgment against appellant for the total amount claimed, from which is this appeal.

Appellant contends for a reversal of the judgment because the work was not done under the authority and direction of the county court. The record reveals by undisputed testimony that the county court ¡never authorized nor directed appellee to do the work for which he presented accounts. Jurisdiction of all matters relating to county taxes and roads was conferred on county.courts by § 28, article 7, of the 'Constitution of Arkansas. In addition, to the constitutional authority conferred upon county courts relative to roads and taxes, the Legislature of 1915 imposed the duties of road -commissioner of Woodruff County upon the county judge. If allowable for road overseers to work the roads in their respective districts without direction from the county court, then the court’s constitutional authority over the road tax, which necessarily means the expenditure thereof, would not only be abridged but, for all practical purposes, would be absolutely nullified.

Again, it was improper to render a judgment on the accounts in the form in which they were presented. According to the undisputed testimony, many of the teams used by the overseer to perform the road work belonged to third parties. The account did not specify how many of the teams belonged to the road overseer himself. There is no authority in the law for an overseer to hire, pay for teams and labor and to file an individual claim against the county for the amounts expended. Section 5263 is mandatory, and provides as follows:

“All persons employed by the road commissioner, or the overseer of any road district, to work on the roads and bridges of any road district, or who have furnished any teams or tools to such overseer or road commissioner under the provisions of this act, shall make out, verify and present his account to the county court, which account shall be indorsed by the overseer of the district in which said work was done, or the road commissioner, as correct; and if the same be so indorsed, tbe county court shall allow such claim, to be paid out of the county treasury to the credit of such road district.”

.Again, the judgment rendered upon the accounts was improper because the undisputed testimony revealed that the quarterly reports filed by appellee as road overseer failed to meet the requirements of §§ 5227, 5264, 5342, 5351, 5352, 5500 and 6282 of 'Crawford & Moses’ Digest. Section 5'264 specifically prohibits the payment for any service performed by a road overseer until he has filed with the county clerk iall reports and statements required of him by law.

On account of the errors indicated the judgment is reversed, and the cause is remanded for further proceedings not inconsistent with this opinion.


text:
    Messina v. Galutza.
    Opinion delivered December 10, 1928.

      Sheffield $ Coates and Peter A. Deisch, for appellant.
   Humphreys, J.

This is an appeal from the decree of the chancery court of Phillips County dismissing appellant’s complaint seeking to enjoin appellees f,rom carrying on a general bus business over State Highway No. 44 between Helena and Ferguson, in Phillips County, Arkansas.

The complaint alleged, in substance, that appellant had la license certificate or permit from the Arkansas Railroad Commission to operate a bus line for the purpose of transporting persons for hire over said highway and between the city and town mentioned; that appellees and each of them were carrying on a, general bus business in ordinary motor vehicles 'and automobiles, over said highway, without a permit from the Arkansas Railroad Commission, and by doing so were encroaching upon the franchise granted appellant.

Appellees filed an answer, denying the material 'allegations of the complaint, and interposing the further defense that appellant did not have an exclusive franchise to operate a bus line over said Highway No. 44, hence had no right to ¡an injunction to protect his' nonexclusive franchise. •

On preliminary hearing a temporary restraining order was issued by the chancery court, prohibiting appellee from interference with appellant in the operation of his busses over said highway without having made previous contracts with the passengers for transportation. On a final hearing of the cause the court dissolved the temporary restraining order, and dismissed appellant’s complaint for the want of equity. The decree was rendered upon the theory that the act in question is not broad enough in its provisions or implications to justify interference by injunction.

The lact in broadest terms conferred power upon the Arkansas Railroad Commission to manage and control motor transportation in the State over its highways, and, as a method for doing so, authorized it to issue licenses and permits to persons, firms and corporations to transport passengers and freight over its improved highways, under certain conditions specified in the act.

The record reflects that appellant obtained a license certificate or permit from the Arkansas Railroad Commission, under act 99 of the General Assembly of 1927, to operate a general bus line over s'aid Highway No. 44, in Phillips County, between Helena and Ferguson and through intermediate towns, for the purpose of transporting persons for hire. Also that appellees obtained a license certificate or permit from the Railroad Commission under said act to operate taxicabs over the highways of Phillips, Desha, Monroe and 'Lee Counties for the purpose of transporting persons for hire. Neither certificate nor permit purported to grant an exclusive franchise, and the act forbids that exclusive franchises be granted by said commission. According to the weight of the evidence, appellees have not confined and did not confine their business to carrying passengers from a given point along Highway No. 44 at any time, by private agreement, at varying* prices and to varying distances. They ran their cars a short distance in front of the busses operated by appellant, and picked up, hauled and discharged passengers on said route wherever they desired to debark.

The licenses or permits obtained by appellant and appellees from the Railroad Commission to carry persons were not intended to allow an interference with the business of. each other. Although authorizing both to carry persons for pay, appellant was granted permission to operate a regular bus line between Helena and Ferguson and upon a fixed schedule, at a rate of fare common to all, and to take and discharge passengers at any point on the route. Appellees were granted permission to operate taxi service to- 'carry persons at any time, by private agreement, at varying* prices and at varying distances. Although neither had or could obtain an exclusive franchise to perform the particular services authorized by his license, yet neither was authorized, under the act or his license, to encroach upon or interfere with the business of the other. The act under which appellant and appellees obtained their respective licenses contains the following- provisions:

“The commission shall have the right to employ one or more inspectors, as may be needed, for the purpose of making- the inspection of licenses from time to time, and if any person, firm or corporation is operating without complying with provisions of this act, then the Attorney General of the 'State of Arkansas, or any interested party, may institute suit in any chancery court where service on the defendant may be had, restraining the further-operation of motor vehicles by such person, firm or corporation, until the provisions of tliis act are complied with. ’ ’

We think this provision broad enough to allow either party to bring- a suit in a court of equity to prevent interference by the other with the privilege 'acquired under the permit or license granted to each. The trial court should have made the temporary restraining order granted appellants perpetual.

On account of the error indicated the decree is reversed, and the cause is remanded with directions to render a decree in accordance with this opinion.


author: Kirby, J.,

text:
    Reliance Life Insurance Company of Pittsburgh v. Pearson.
    Opinion delivered December 10, 1928.

      Cockrill & Armistead, S. M. Casey and Shields M. Goodwin, for appellant.

      John E. Miller, for appellee.
   Kirby, J.,

(after stating the facts). It is insisted that the court erred in holding that the giving of the note by the insured to the agent of the company, who delivered the policy to him, constituted a payment of the yearly premium and continued the policy in force at the time of the death of the insured.

Appellant concedes that the taking of such a note .'by a general agent of the company would-have constituted a payment of the premium, so far as the company was concerned, but -contends that the soliciting agent was without authority to accept such note, and that the policy -lapsed and was void because of the nonpayment of the premium in cash when it became due. It is undisputed, however, that the first premium for the short term insurance was duly paid to the company, and that the policy was issued and delivered by the insurance company through its soliciting agent, who was authorized to collect the premium, and 'who took the note payable to himself for the first premium due after the end of the short term, or that any action was taken by the insurance company to ascertain how the premium had been paid upon the delivery of the policy, or any steps to claim lapse of the policy for failure to pay the premium before the death of the insured.

The policy itself does not provide it shall be void until the payment of the first premium note is made in cash, and, if it had done so, the first premium due for the short term was conceded to have been paid, and does provide for the payment of the amount of the policy, “less any indebtedness herein to the company or any unpaid portion of the premium for the current policy year.”

It is true the letter of instructions provided that the policy must not be delivered until the first premium is fully settled for and the insured has done “all the acts the company requires of him, and has settled the premium in full, then, and not until then, the agent may deliver the policy to the applicant;” provided 60 days have not expired after the medical examination. It is not disputed that these instructions were for the agent, and not communicated to the insured, nor that the policy was actually delivered to him while he was in good health, within the time provided therefor, upon the settlement of the premium in full by the execution of the note therefor to the agent.

It was the duty of the agent to report his action, of course, to his principal, and no steps were taken by the principal to ascertain whether the policy had been delivered to the insured in accordance with its instructions, nor any effort made to demand the return of the policy or give information to the insured of its alleged lapse and invalidity before insured’s death occurred. The insured necessarily rested secure in the belief that the agent’s prior instructions, of which insured had no information whatever, were complied with in the delivery of the policy, and, not having had any information from the company to the contrary, before the time of his death, it is now estopped to deny that delivery was made of a valid policy or contract of insurance.

Under the rule of our decisions, the insured is allowed a reasonable time only for examination of the policy, after its delivery to him, to ascertain whether it is the policy applied for, and is held, as a matter of law, to have accepted it and become bound to pay the premium, unless he shall notify the insurer, without unreasonable delay, of his rejection of or refusal to accept such policy. Remmel v. Griffin, 81 Ark. 268, 99 S. W. 70; Carrigan v. Nichols, 148 Ark. 336, 230 S. W. 9; People’s Savings Bank v. Raines, 175 Ark. 1155, 2 S. W. (2d) 20.

A note given for the premium on insurance is required by statute to state the purpose of it, and declared not negotiable until the policy for which the note was given as payment of premium shall have been issued and delivered to the maker of the note, and presented to him in the form applied- for and its acceptance refused. The purpose of the statute, as held in People’s Savings Bank v. Raines, supra, evidently being to prevent irresponsible insurance companies and irresponsible agents of insurance companies from realizing on the obligations given for insurance by applicants before the delivery of the policy, and without affording them the protection applied or contracted for; and so also should the insurer be held bound 'by its contract of insurance, in accordance with its terms, by the delivery of its policy, upon his application to the insured through an agent, general or special, unless it shall notify the insured, within a reasonable time after he receives such policy from such agent, that it was delivered without authority and contrary to instructions to the agent, and did not become effective or a valid contract.

It is true the circumstances indicate that the agent was not greatly experienced in soliciting applications for insurance, the policy being dated upon the day of the date of his agency contract, but there is no indication whatever that the insured had any intimation that the agent had not complied with his instructions, if such was the fact, in the delivery of the policy to him. Under the circumstances we hold that the agent had authority to make settlement of the premium with the insured, and, having done so by the acceptance of the note and delivery of the policy upon its execution, that the note amounted to a settlement of the premium within the terms of the instructions, and that the policy so delivered was not invalid because cash was not collected instead of the note taken in settlement of the premium.

No complaint is made of the instructions. The majority of the court holds that the record is free from error,- and that the judgment must be affirmed, in which holding the writer does not concur. It is so ordered.


text:
    Paragould Land Company v. Taylor.
    Opinion delivered December 10, 1928,

      M. P. Huddleston, -for appellant.

      C. M. Buck, for appellee.
   Kirby, J.,

(after stating the facts). It is insisted that the court erred in sustaining the demurrer to the intervention of Shannon and others, and also in sustaining a demurrer to the answer of B. M. Kitchens and dismissing it for want of equity. The attorney for interveners insists that but one issue is presented, and that an issue of law, by the appeal as to whether a common unsecured creditor has the right to intervene in a foreclosure suit and dispute the title of the Bank Commissioner, having in charge the affairs of the pledgee, to the property pledged. The Bank Commissioner, in charge of the Paragould Trust Company, insolvent, sought 'by this suit to- foreclose a written pledge agreement or assignment executed to the insolvent trust company by A. Bertig, ’ S. Bertig- land Joe R. Bertig, on September 18, 1926, and to sell the stock certificates of the Richards Land Company, described in the pledge agreement, it being alleged that 667 shares were owned by A. Bertig, 667 by S. Bertig, and 666 shares by Joe R. Bertig, and pledged to secure an aggregate indebtedness of approximately $160,000 due by the Bertigs individually-and by various mercantile, gin and land corporations composing the Bertigs’ interests, including an indebtedness of $15,500 due the Paragould Trust Company by the Bertig Realty and Investment 'Corporation, and a note of B. M; Kitchens for $5,000 indorsed by Joe ¡Bertig.

The Richards Land Company, a corporation, was organized in 1906, before the organization of the Bertig Realty and Investment Corporation and the other corporations designated in the intervention. There is no contention that it was fraudulently organized or that it was insolvent. The interveners alleged that its assets were worth $75,000 or $80,000 more than its indebtedness.

At the time of the execution of the pledge agreement in the suit, the stock in the Richards Land Company was held by the Bertigs, and the old stock certificates were surrendered and new certificates issued for the same amount of stock held by each of the said Bertigs to the Paragould Trust Company as trustees. The interveners alleged that they were creditors of the various corporations, which they allege were owned and controlled by Bertig Brothers, a partnership, which in its dealings ignored the separate corporate entities and treated the various corporations as Bertig Brothers, a partnership. They aHeged further that the corporations of which they were creditors, designating them, had been adjudged bankrupt, that petitions in bankruptcy had been filed against Bertig Bealty and Investment Company, a corporation, and Bertig Brothers, a partnership. These allegations were true, and the realty company and the Bertig Brothers partnership were each adjudged bankrupts before the hearing. There is no allegation in the intervention that either Bertig Brothers, a partnership, or Bertig Bealty and Investment Company, a corporation, or any of the trustees of the corporations adjudged bankrupt, had been requested to intervene in the suit and had refused to do so. Certainly the interveners, creditors of the corporations already adjudged bankrupt and for whom trustees had been appointed, could not intervene in this suit to protect the assets and enforce the collection of the debts of the bankrupt corporations without alleging the failure or refusal of the trustees, after request so to do, to take the required action; and although Bertig Brothers, partnership, and the Bertig Bealty and Investment Company, a corporation, had not been adjudged bankrupt at the commencement of the suit by the Blank Commissioner, the interveners alleged that they had been either adjudged bankrupts or that petitions in bankruptcy had been filed against them, and their adjudication in bankruptcy related back to the filing of the petition, which was subsequent to the filing of the Bank-Commissioner’s complaint and prior to the filing of the intervention.

The creditors of an insolvent corporation in the hands of a receiver or trustée in bankruptcy cannot maintain an action for property belonging to the bankrupt or insolvent corporation without allegations showing the failure or refusal of the trustee or receiver to protect the assets and their interests. Creamery Pkg. Mfg. Co. v. Wilhite, 149 Ark. 576, 233 S. W. 710; 8 Fletcher on Corporations, pp-. 9250-9251.

The interveners alleged that the stock pledged was the property of Bertig Brothers, a partnership, composed of A. Bertig, -S. Bertig and Joe Bertig, and that each of said persons who composed the partnership had pledged Ms shares of the corporation. It was also alleged that the stock so pledged was the property of 'Bertig Realty & Investment Company, but the allegation of the complaint is undisputed that the original certificates were issued to A. Bertig, S. Bertig and Joe Bertig, land that it was pledged to the. baMc by each of said Bertigs, and the stock certificates were duly reissued by the corporation to the pledgee as trustee to secure the indebtedness specified in the pledge agreement, which was exhibited with the complaint of the Bank Commissioner for foreclosure.

It is true Kitchens, the maker of the note, was sued by the Bank Commissioner along with the other debtors of the Paragould Trust Company, in order to foreclose the lien of the pledge given as collateral security for payment of his note specified in the agreement, but no judgment was prayed against him, nor could have been rendered under the allegations of the complaint upon the indebtedness land his answer, admitting that, although he had executed the note for securing the payment of which the pledge of the stock had been made by the Bertigs individually, the note in fact evidenced an indebtedness of Bertig Brothers, the amount of the loss incurred by them in the operation of a subsidiary partnership, and that he was not indebted thereon at all. If the allegations of the answer were true, it would not have prevented the granting of the relief to the Bank Commissioner foreclosing the lien against the stock pledged and applying it to the note specified, for security of the payment of the note for which it was pledged, even though the note was found to represent in fact an indebtedness of the Bertigs instead of the maker, since, so long as it was not a simulated claim, the Bank'Commissioner would have had the right to apply the proceeds realized from the sale of the stock pledged to its payment.

The judgment of dismissal under the circumstances did not preclude the maker of the note from interposing the defense set up in his answer herein to a suit for collection of the note from him, which was not attempted to he made in this proceeding.

The answer and intervention not having stated a cause of action nor defense, the demurrer thereto was rightfully sustained, and the decree is accordingly affirmed.


text:
    Cameron v. Westbrook.
    Opinion delivered December 10, 1928.

      Jones & Hooker and R. S. Cameron, for appellant.

      Bruce H. Shaw and J. M. Shaw, for appellee.
   Kirby, J.,

(after stating the facts). The chancellor held that ¡appellee and her grantors had held possession of the strip of land in controversy for more than seven years, “with a mistaken idea that it constituted lot 6 in said addition/’ and acquired title by adverse possession.

Appellee’s grantor, her husband, lived on premises belonging to his father, the common source o>f title, at the time of his father’s death, and was a tenant in common of the undisposed-of lands of the estate. He recognized in his petition for partition of the lands that the homestead devised to the widow, etc., was situated on lot 7 of the addition, and only prayed the sale of lot 6 adjoining the homestead in the partition, and purchased same as lot 6 at the commissioner’s sale. He later mortgaged it as such lot 6, and particularly described it as 104 8/10 feet wide, which did not include any of the strip of land in controversy, which was in fact a part of lot 7 as platted, and so recognized by him in his suit for partition. There was no act or thing done by him'in the way of .a change of possession after his purchase of the lot at the partition sale, nor was there any act shown to have been done that should charge the other owners of lot 7 with notice of any adverse claim of possession by him or his grantees. The chancellor in fact found that appellee held possession of the strip of land in controversy .under the “mistaken idea” that it constituted a part of lot 6.

There is no testimony in this record showing when any knowledge of appellee’s adverse claim or of her intention or that any of her grantors to so hold was brought home to the other tenants, and, under such circumstances, the holding could not be adverse to them. Singer v. Naron, 99 Ark. 446, 138 S. W. 958. It was there said: '

“In order for the possession of the tenant in common to be adverse to that of his cotenants, ‘knowledge of liis adverse claim must-be brought home to them directly, or by such notorious acts of an unequivocal character that notice may he presumed; the reason being that the possession of one tenant in common is the possession of all the tenants in common.”

Appellee argues that at no time did she or Howell L. Westbrook, her grantor, acknowledge the right or title of appellants or those under whom they hold, and shys that, in the suit for partition of all real estate of W. H. Westbrook, deceased, in which Howell L. Westbrook was plaintiff and Cora N. Troxel and Fi’anklin West-brook were defendants, they were then put on notice that i,t was to be a final disposition of all the estate; that they then had opportunity to set up any claim they mig’ht have had to the .strip of- land in controversy, the east 6 feet and 2 inches of lot 7, and, having failed to do so, acquiesced in the disposition made of it. It must be remembered, however, that it was alleged in that suit that the homestead, consisting’ of lot 7, was given by the will to the widow for life, and to Howell L. Westbrook, plaintiff, and Franklin Westbrook, one of the defendants, in remainder, and not subject to partition or sale, and it was so adjudged that the said parties were tenants in common in the remainder.

The undisputed testimony shows no act of possession or claim of ownership of part of said lot 6 by occupancy of lot 6 after the purchase 'by Howell at the partition sale different from his holding as tenant of his father, nor any act on his part calculated to bring home to his covenants knowledge of his adverse claim to any part of said lot 7, and the chancellor erred in holding otherwise.

The chancellor likewise erred in holding appellee acquired title by adverse possession against the remainderman, and canceling his conveyance of the property in any event, before the death of the life tenant, his mother, Cora N. Troxel, with whom he joined in the deed conveying his remainder. He had no right of action to protect his interest in the part of the lot hi controversy, and title then could not therefore, as against him, be acquired by adverse possession of the other remainder-man or his grantees. Gallagher v. Johnson, 65 Ark. 90, 44 S. W. 1041. See also Collins v. Paepcke-Leicht Lumber Co., 74 Ark. 81, 84 S. W. 1044.

The decree will be reversed accordingly, and the cause remanded, with directions to dismiss the complaint for want of equity. It is so ordered.


author: Kirby, J.

text:
    Barrett v. Harrel.
    Opinion delivered December 10, 1928.

      'A. F. Triplett, for appellant.

      Thos. W. Raines, for appellee.
   Kirby, J.

This appeal is prosecuted from a judgment for damages for personal injury suffered by appellee on account of the failure of appellant to erect a screen over the saw at ivhich he was working when the injury occurred. The suit was brought against appellant and A. B. Fisher, alleged to compose a partnership, operating the sawmill under the partnership name of A. B. Fisher. Judgment was rendered against both Fisher and Barrett. Only Barrett has appealed.

Only two questions are presented for consideration here: the insufficiency of the evidence to establish a partnership between appellant and A. B. Fisher in the operation of the mill, and the admission of certain testimony alleged to be incompetent. No objection is made to the declarations of law defining a partnership to the jury.

Appellee testified that he understood A. B. Fisher and Moody Barrett were the owners of the mill and partners in its operation; that he knew Moody Barrett was a partner, 'because .Barrett had told him so numerous times in his store, and showed him the written contract between himself and Fisher for operation of the mill. Said he 'knew all about it. After stating Barrett h'ad shown him the written contract and told him out of 'his own mouth that they were partners, witness stated, in reply to the question, “Is that the only reason you knew they were partners?” Answer: “No sir. I know anything I got in the mill I had to get Barrett to get it; I could not get anything from Fisher; he would tell me to go to Barrett and get it.”

Lev Goodrich was permitted to testify, over objection, that E. T. Harrel, the appellee, brought an order to him for mill supplies signed, “J. M. Barrett, by J. M. B. Jr.,” which reads:

“11-4-1926 5.80 Pd. Dc. 14.

“Arkansas Mill Supply Co.:

Please let Mr. E. T. Harrel have

1 box packing % inch and 3/5 inch

1 strip lace leather about 6 inches

1 belt punch.

“J. M. Barrett,

“By J.- M. B.- Jr.”

-Martin testified that he sold some material to the sawmill at Sherrill, but did not know to whom the mill belonged. The order was from J. M. Barrett by J. M. B. Jr., he believed. The objection was sustained to this testimony, the order not being- produced. Witness was allowed to state, however, that the order was brought by Harrel, and the supplies were furnished for ia sawmill. He supposed Harrel worked over there, but did know he brought the order. Witness, on cross-examination by appellant’s attorney, said he did not remember what stuff was furnished, but answered the question, “You say it was an order from J. M. Barrett, by J. M. B. Jr.?” “I am positive that was the way i't was signed.”

Appellant and Fisher filed separate answers, denying that any partnership existed between them in the operation of the mill, and appellant testified that he had no interest of any kind in the mill or its operation. Denied having told Harrel that he was a partner or shown him the written contract, which he said was one relating to the purchase of timber, but did not produce it in evidence. He also explained the orders, saying J. M. Barrett, his father, supplied many materials to Fisher, the owner of the mill, and to whom they were charged, and that he kept the store of his father, and when orders came for stuff they did not have on hand he gave orders to other merchants for his father for the supplies, which were charged to Fisher, the owner and operator of the mill, on the books of the Barrett store. He" also stated that all the lumber bought from the mill was purchased by J. M. Barrett and credited on the account of A. B. Fisher, owner of the mill, for supplies furnished him by J. M. Barrett, who owned and operated the store. Fisher did not testify in the ease.

The jury might well have believed the testimony of appellant, whose explanation of the orders for mill supplies bought from J. M. Barrett appeared reasonable and conclusive, and also his denial of his having any interest whatever in any way in the ownership or operation of the mill, and his denial of having told appellee that he was a partner in the operation of the mill, or having shown him any written contract relating to the ownership and operation of same They credited appellee’s statement, however, and found against appellant, and there is substantial testimony supporting their verdict.

Neither was error committed in the introduction of the testimony of the two witnesses complained of. The court only permitted the introduction of the testimony relating to such orders as were presented by appellee Harr el and signed by appellant. One of the orders was introduced in evidence, and the court refused to allow the other witness to testify to the method of signature of the order that he'said was presented by Harrel for mill supplies. The appellant himself brought out on cross-examination of this witness the method of signature of the order, and, as already said, his explanation of the giving of the orders was entirely consistent with his contention that he had no interest whatever in the ownership or operation of the mill, but the jury found otherwise upon testimony sufficient to support the verdict.

We find no error in the record, and the judgment is affirmed.


text:
    McIver Abstract Company v. Slaton.
    Opinion delivered December 10, 1928.

      E. Newt Spivey and’ Dulaney $ Steel, for appellant.
   Kirby, J.,

(after stating the facts). It is insisted that the court erred in holding act 346 of 1925 invalid, and this contention must ¡be sustained.

The land was sold for taxes, under order of the court, on the 20th day of 'September, 1924, and purchased by the district, and, under the law existing at the time, subject to redemption within two years. Not being redeemed, the commissioner, on October 25, 1926, conveyed it by deed to Road Improvement District No: 7.

Said act 346 of the Acts of 1925 became effective on the 10th day of June, 1925,'before the two years allowed by the existing law for redemption of the land had expired, and by § 1 thereof the time for redemption was extended for a period of three years, making a total of five years allowed ¡for redemption from the date of the sale, the land having been purchased by the road improvement district. Walker v. Ferguson, 176 Ark. 625, 3 S. W. (2d) 694.

It was held there, Walker v. Ferguson, supra, that a different rule of law was applicable in cases of this kind, where the land was purchased by the State or one of its instrumentalities, at the tax sale, from the rule applied where such land was struck off' to a private purchaser, and that it was competent for the Legislature to extend the time for redemption of property sold for the nonpayment of road taxes so ¡far as the rights of the State or its instrumentalities are concerned.

- The purchaser of the land from the road improvement district, before the time allowed by law for its redemption had expired, acquired .only such title as the road improvement district had when its deed of conveyance was executed.

The chancellor erred in declaring the statute extending the time of redemption invalid and holding the appellant not entitled to redeem from the district or its grantee and to a foreclosure of its mortgage against the land.

The decree will accordingly be reversed, and the cause remanded' with directions to make all necessary orders for redemption of the land and foreclosure of the mortgage thereon, and all other necessary relief in accordance with the principles of equity and not inconsistent with this opinion. It is so ordered.


author: Mehaffy, J.

text:
    Chalkley v. Henley.
    Opinion delivered December 10, 1928,

      Golden Blount and Brundidge & Neelly, for appellant.

      Bogle & Sharp, for appellee.
   Mehaffy, J.

On the 11th day of December, 1927, J. G. Howard sold to the appellee 160' acres of land in Monroe County for the sum of $6,400, payable in annual installments, $1,000 to be paid on or before December 1, 1918, $1,000 one year thereafter, another $1,000 one year after that, $1,700 in 1921, and $1,700 in 1922. The land purchased is described as follows: the northeast quarter of section 7, township 3 north, range 2 west, in Monroe 'County, Arkansas.

The parties entered into an agreement in writing, showing the sale of the land, the execution of the notes, which were to bear interest at the rate of 7 per cent, per annum from date, interest payable annually, and from maturity at the rate of 10 per cent, per annum. The contract provided: “It is agreed that, when the buyer has paid $1,000 of the principal on the contract and the interest due up to that date, he has the option to have this contract annulled, and the seller agrees to make a warranty deed to said property, retaining a vendor’s lien for the balance of the unpaid purchase price.”

It was also agreed that time was of the, essence of the contract, and after the buyer failed to pay, the seller had the option either to declare the entire balance of the purchase price due or rescind the contract. And, in case of rescission, all moneys paid by the buyer were to be taken and retained as rent.

The contract also provided for a lien on one-half of all the crops grown on the land each year during the life of the agreement.

The appellee paid the first $1,000 note and the interest due up to that time, but -did not make any further payments. This contract was made in December, 1917, and, so far as the record shows, no effort was made to collect until February, 1927, when suit was filed by appellant to foreclose the lien for the purchase money. This was nearly ten years, and, according to the contract, the last payment was due in 1922.

Appellee filed answer and cross-complaint, alleging that appellee was entitled to a deed when he paid the first $1,000 and interest, but that the seller failed and refused to execute a deed as provided in the contract. Appellee alleged that because of this failure he was damaged in the sum of $5,600, because he had contracted to sell the land for $75 per acre, and in his cross-complaint he asked judgment for the $5,600. He further alleged that the seller agreed to give an abstract showing a good title to said lands, and failed to comply with this part of the contract, in that no abstract was furnished. He further alleged that he had made valuable improvements on the land; had expended $2,609.25, and asked that, if the court should hold that he was not entitled to the profits, he was entitled to recover the $1,448 which he had paid on the lands, together with the amount or value of the improvements put on the land.

Appellee asked that he have judgment against the appellant, and that the same be declared a lien on the land, and that the land be sold to pay said judgment.

This cross-complaint was.filed on the 25th day of April, 1927. The appellant never filed any answer to the cross-complaint, and no steps were taken to bring the case to trial by either party, and on February 6, 1928, 'one year after the suit was filed, the court dismissed the cause for want of prosecution. The clerk, soon thereafter, wrote to Mr. Blount at Searcy, Arkansas, attorney for appellant, that the cause was dismissed, and he also inclosed a copy of the cross-complaint. There is nothing appearing in the record to show that the cross-complaint was dismissed, except appellee’s attorney asked that the order dismissing the cause be set aside, so that he could go to .trial on his counterclaim. This occurred on the 2d day of April, 1928. He asked that the court vacate and set aside the order made at the February term dismissing said cause, and' stated as his reasons that he had filed a ■cross-complaint and had his witnesses present at court to substantiate the merit of same. The court had overlooked the filing of the cross-complaint, and found that he had filed a cross-complaint in February, 1928, and that the cause should not have been dismissed until defendant’s cross-complaint was disposed of. The court thereupon vacated and set aside the order dismissing the cause, and gave the defendant an opportunity to prosecute his cause of action upon his cross-complaint, and the defendant announced ready to go to trial on his cross-complaint, and the court thereupon proceeded to trial.

The court found that complaint was filed in February, 1927, cross-complaint in April, 1927, and that since that time the court had held both regular and adjourned terms of court as follows: February, 1927, regular term; April 4, 1927, adjourned term; April 5, 1927, adjourned term; June 6, 1927, regular term; July 27, 1927, adjourned term; October 3, 1927, regular term; December 12, 1927, adjourned term; and February 6, 1928, regular term; and that neither the plaintiff nor any attorney representing- him had appeared at either of said terms, and that the cause was dismissed at the February term of court for failure to prosecute. That the plaintiff had failed to plead, answer or demur to the cross-complaint, and that his time for so doing had long since passed.

The court further found that they entered into the - contract, and g’ave judgment against the appellant for $1,448, the amount appellee had paid him, and for the sum of $2,925 for repairs, and found that said repairs were completed February 1, 1928.

The court further found that defendants had expended $600 in clearing in August, 1918, and paid taxes on the land for 1918 and 1919, amounting’ to $352.98, and gave judgment for the above amount, with 6 .per cent, interest, less the rental value of said land for 1918 to date, which he found to be $3,160, leaving a balance due, according to the finding of the court, of $3,849.12.

The court canceled the notes of Hensley, and, after the evidence had been heard and the cause submitted to the court on defendant’s cross-complaint, counsel for plaintiff appeared in court and asked the court to set aside the orders it had made and permit him to file an answer and continue the cause to a future date, which motion the court denied, and the plaintiff saved his exceptions.

The motion to set aside the judgment, entered on the 2d day of April, 1928, stated, among’ other things, that plaintiff had never been advised that defendant was ready to try said cause upon the cross-complaint; never been notified to taken any depositions; and that on the 14th day of February, 1928, his attorneys were advised by the clerk of the court that the cause had been dismissed for want of prosecution, and advised that the next term of court would be the first Monday of April, 1928. That plaintiff’s attorney left! Searcy for Clarendon, on the 2d of April, but had car trouble and did not reach there until about 10 a. m., and then asked to be permitted to put the matter over and to introduce proof to rebut the testimony of the defendant. He further stated that he had a good defense to the cross-complaint; that he had at no time failed or refused to deliver deed; that appellee could not have been damaged by the loss of a sale of property, and that he had not made the improvements he claimed, and, if he was given an opportunity, he could show that appellee was not entitled to any damages. He further stated that he is a nonresident of the State, and his attorney resided at Searcy.

The appellant contends that the court erred in setting aside the judgment dismissing the cause for want of prosecution and in proceeding to hear it upon the cross-complaint of defendant without notice to appellant or his attorney; that the attorney had received a letter from the clerk notifying him that the cause had been dismissed, and that, if he desired to' do so, he could appear there on the 2d day of April, when court would meet, and ask the court to set aside the judgment.

The undisputed proof shows that no action whatever was taken by the appellant or his attorney for about a year after he filed his complaint. ' While it is true that the attorney that originally filed the complaint moved to California, yet his partner remained at Searcy, and no steps were taken and no communication had with the clerk of the court or any one else, in order to ascertain what pleadings, if any, had been filed by the opposite party, and it was within the power and discretion of the court to dismiss the cause for failure to prosecute. It was also within the discretion of the court to permit a trial on the counterclaim without continuing the cause to give plaintiff an opportunity to get witnesses. He had a copy of the cross-complaint on the 14th of February. He not only did not make any effort to take any testimony, but did nothing with reference to the suit, according to his own proof, until the second day of April, and then got to court after the case had already been tried and submitted to the court. We think the conduct of the parties was such as justified the court, in the exercise of its discretion, to dismiss the cause.

“Asa court may dismiss an action for want of prosecution, so it may in its discretion vacate or refuse to vacate an order of dismissal, and such order will not be reversed by the Supreme 'Court on appeal, unless there has been a manifest abuse of discretion.” 9 R. C. L., 210.

■Courts are bound to have some rules and to regulate the procedure.' The disposing of the business in the courts would be impossible unless the trial courts had some power to regulate the procedure and to fix the time of the trial of cases. An order dimissing a case for want of prosecution, granting or refusing a continuance, setting aside an order dismissing a case for want of prosecution, will not be reversed by the Supreme Court unless there is a manifest abuse of discretion.

In this case we do not think there was any abuse of discretion. There are many things the trial court may do, such as we have suggested above and others, that will not be reversed by this court unless there is an abuse of discretion. See Richards v. Howell, 129 Ark. 390, 196 S. W. 483; C. H. Robinson Co. v. Hudgins Produce Co., 138 Ark. 500, 212 S. W. 305; Johnson v. Mo. Pac. Ry. Co., 149 Ark. 418, 233 S. W. 699 ; Franklin v. State, 85 Ark. 534, 109 S. W. 298; Central Coal & Coke Co. v. Graham, 129 Ark. 550, 196 S. W. 940; Holub v. State, 130 Ark. 245, 197 S. W. 277.

This court has also held that one may lose his right by the negligence of his attorney, and it is said, in the absence of fraud or unfairness, one is concluded by the acts or omissions of his attorneys. He is entitled to no equitable relief. Scroggin v. Hammett Grocery Co., 66 Ark. 183, 49 S. W. 820; Blackstad Mercantile Co. v. Bond, 104 Ark. 45, 148 S. W. 262.

After a careful consideration of the entire record, we are of opinion that the court did not abuse its discretion in refusing to continue the case and permit appellant to file answer to the counterclaim and take proof

Learned -counsel for appellant have called our attention to quite a number of authorities, but most of them are cases where there was a misunderstanding without negligence, or where there was an unavoidable casualty. Neither of these questions is in this case.

It is next contended that appellees were not entitled to any damages at any time, and if they had had a cause of action any time, it was barred by laches. The claim for damages is based on an alleged violation of the contract by appellant refusing to execute a deed. In the first place, the evidence does not show that there was any refusal on the part of the appellant or that demand was made of him. In the next place, if all that appellee claims is true, he could not have been damaged thereby. If he had a purchaser, a person who wished to buy the land, appellee had the contract and receipt showing that he had made one payment, and could have transferred that contract, which would have been as binding as a deed retaining a lien would have been; or he oo-uld have compelled the appellant to malee him a deed. But, even if he should have done none of these thing's, that alleged breach of contract occurred, according to the proof and the finding of the court, in 1918. Nothing was said about it to appellant or any one else. No claim of damages was made by appellees until the filing of their cross-complaint in .April, 19>27, about nine years, and his claim therefore for damages because of his breach of contract was barred long before suit was begun.

'The appellees also claim, and the court allowed, $2,009.25 for repairs, and it is expressly stated that these repairs were completed prior to February 1, 1918. Certainly it was too late to bring’ .a suit on this claim after nine years, when no claim had been made, no effort to collect it, and nothing whatever said about it. The same is true about the $600 item.

Appellees also claimed and were given judgment for $352.98 for taxes paid in 1918 and 1919. This item is likewise barred, but, if it were not barred, if the contract is canceled, appellees would not be entitled to recover this item, because they were at the time in possession, receiving the rents and profits from the land on -which they claimed to have paid taxes.

We are therefore of opinion that the appellees are not entitled to any of the items allowed by the chancellor, not having made any claim for any of them until after suit was filed to foreclose the lien for the purchase money.

The chancellor allowed the $1,440 which appellee had paid, and gave judgment for that amount, and found that the rental value of the property was $3,160, leaving a balance of $3,849.12 against the appellant. The appellant is not entitled to rent, and the appellee is -not entitled to any of the items allowed him. The appellee is not claiming the land. In fact, he asks that he have judgment against the appellant, and that it be declared a lien on appellant’s land.

We have reached the conclusion that the chancellor’s finding as to the dismissal of the complaint and to refusal to permit appellant to file an answer to the cross-complaint and continue the case, was within the discretion of the chancery court, and should be affirmed-.

The deoree of the chancery court dismissing plaintiff’s case for want of prosecution and finding against him on that being affirmed, it follows that his order canceling the notes should be affirmed, and that the case should be reversed as to his finding any amount in favor of the appellees, and finding rent in favor of the appellants.

The decree of the chancery court is ■ therefore reversed, and remanded with .directions to enter a decree in accordance with this opinion, and that he should not only cancel the notes, but the contract of sale, so that the appellant may have his land. Appellees are not required to pay rent, because it appears that the claim for improvements and expenditures is approximately equal to the rental value for the place at the time it was held by appellees, and appellant could at any time, after default of the payment of any installment, have brought suit to foreclose.


text:
    First National Bank of Clarksville v. Scranton Coal Company.
    Opinion delivered December 10, 1928.

      Evans & Evans, for appellant.

      I. S. Simmons and Cochran & Arnett, for appellee.
   Mehaffy, J.

On the 6th day of January, 1927, the First National Bank of Clarksville filed suit in the chancery court of Logan County, Arkansas, against the defendant, Scranton Coal Company, to foreclose a second mortgage upon the property of the coal company and to obtain an order appointing a receiver to take charge of the coal company’s property, covered by the bank’s mortgage. The American Bank & Trust Company of Paris, Arkansas, held first mortgage on the property.

The appellant alleged that the coal company was indebted to it, and that said indebtedness was secured by a mortgage, a copy of which was attached to the complaint; that said mortgage of appellant was subject to a prior mortgage securing the sum of $3,200 to the American Bank & Trust Company of Paris, Arkansas. It asked that the American Bank & Trust Company be made a party and required to appear and answer. Appellant also stated in its complaint that the defendant coal company was indebted to various parties in considerable sums, all of which was due and payable, and that numerous creditors of defendant were impatient and demanding settlements, and would commence litigation unless a receiver was appointed. That the payroll for labor, due the 31st of December, was unpaid; that certain laborers had already begun suits for the amounts due them and attached certain property, and that other laborers would sue, and that the defendant would be greatly harassed, its operations obstructed, and its property dissipated in cost and expenses unless a receiver was appointed. It stated that the coal company was not insolvent; that its assets greatly exceeded its liabilities, and, with proper management of its affairs, it could be so handled as to enable it to pay fully ¡all its obligations and preserve and protect its property. It alleged that it sued on its own behalf and for the benefit of all creditors of defendant, and asked, upon a final hearing’, that it have judgment against the defendant for the amount due it and a foreclosure of its mortgage and sale of the property to pay said indebtedness. The complaint was verified by the president of the bank. The notes and mortgages were filed as exhibits to plaintiff’s complaint.

On the same day that the suit was filed, the Scranton Coal Company entered its appearance, ¡and consented to the appointment of a receiver, and the chancellor on the same day appointed a receiver, as prayed for in plaintiff’s complaint.

.The American Bank & Trust Company filed answer, intervention and cross-complaint, setting forth the indebtedness of the Scranton Coal Company to it, and filed with its answer the note and mortgage, and asked judgment and foreclosure, and that the property 'be sold.

Numerous other interventions of creditors of the Scranton Coal Company were filed. The receiver then filed a petition, showing’ that the company owed sums approximating $25,000, including payroll due laborers, and that there were no funds immediately available, and stated that it would be to the interest of all parties to sell the property, after giving the usual notice, and asked for an order of sale of said property.

The receiver also filed a statement showing a number of cars of coal of the total value of $11,518.94, showing also that a number of .the cars had been assigned to the First National Bank, and that, when the cars were sold, the proceeds should be applied to the payment of moneys advanced by the plaintiff. The itemized statement filed by the receiver of the assets and property of the coal company showed an estimated value of $89,450, and to this there was added the stationery, supplies and office fixtures, the value of which was estimated at $500, making a total -of the estimated value of the property of $89,955. It is alleged that the statement of the estimated value does not include 19 cars of coal, amounting to $11,518.94, which had been assigned to the appellant bank. •

The property was ordered sold, as prayed for by the receiver, and was sold to R. D. Dunlap, as trustee, for $5,500, this being the only bid. R. D. Dunlap was president of the appellant bank.

Thereafter the receiver filed his report, and exceptions were filed to said report, were heard by the court and overruled, and the report of the receiver was approved by the court.

The court found the amount of indebtedness due the appellant and interveners, and held that the laborers intervening were entitled to la first lien on the property. The cost of the receivership amounted to approximately $8,000, as shown by the receiver’s report. The court decreed that this should be paid by the First National Bank of Clarksville, the appellant herein.

As far as necessary to do so, attention will be called to the facts in the opinion, and it is unnecessary to set them out further here.

It is contended by the appellant that it should not. be required to pay the costs and expenses of receivership, and it quotes § 1838 of Crawford & Moses’ Digest in support of that contention. That section reads as follows: “When a suit is brought in the name of one person to the use of another, the person to whose use the suit is brought shall be liable for the payment of ¡all costs which the plaintiff may be adjudged to pay.” And it is contended that the suit in the instant case was commenced by the First National Bank, who held a second mortgage, and sought to foreclose, subject to the prior rights of the American Bank & Trust Company and all other claimants whose rights upon intervention might lie made to appear as prior to the rights of the First National Bank. Appellant states that the suit was brought not only in the interest of the bank, but in the interest and for the use of all creditors and claimants who might desire to intervene, and all other claimants did intervene.

It may be said in answer to this contention that the suit was not brought by appellant in its name to the use of another. The suit was brought by appellant for its own use, to collect its own debts, and the section of the Digest above quoted has no application to a suit of this 'kind.

Appellant argues that the question of costs seems not to have been considered, the court taking the view that the liability of the bank for the excess costs had been conceded.' But it says this attitude on the part of the counsel was due solely to the fact that the counsel who represented the bank in the last stages of the receivership had the impression that the counsel had not contested this feature.

The appellant correctly argues that giving costs in equity is within the discretion of the chancellor, and cites Mt. Nebo Anthracite Co. v. Martin, 86 Ark. 608, 111 S. W. 1002, 112 S. W. 802, and Lackey v. Waterworks, 80 Ark. 108, 96 S. W. 622. Many other cases decided by this court might be cited. There is, however, no dis,~ pute about this proposition of law. A court of equity miay, in proper cases, apportion the costs, although in law cases the losing party must pay the costs.

Attention is next called .by appellant to the rule as stated in 34 Cyc. 366. It quotes from this at length, but the latter part of the quotation is'as follows:

“So the general rule that such expenses are to be taken out of the fund or property in the receiver’s hands, is held not to contemplate that they shall be taxed as costs or charged against the party at whose instance the receiver was appointed, merely because he was ultimately unsuccessful on the merits of his suit, and when the validity or propriety of the appointment itself is not attacked. ’ ’

Appellant also calls attention to the case of Ferguson v. Dent, 46 Fed. 88; Farmers’ Loan Co. v. Pacific Railroad Co., 31 Ore. 237, 48 P. 706, 38 L. R. A. 424, 63 Am. St. Rep. 822, and cases cited there. Also Atlantic Trust Co. v. Chapman, 208 U. S. 360, 28 S. Ct. 406, 52 Law ed. 528. And appellant cites and quotes from other cases relied on to support1 its contention.

The court in its decree stated: “As to the cost of the receivership, amounting approximately to $8,000, as shown by the report of J. W. Houston, the receiver herein, the attorneys for the plaintiff concede that all over and above the amount received from the sale of the property should be paid by the plaintiff, the First National Bank of Clarksville, .Arkansas.”

Whether the text quoted in appellant’s original brief is supported by the cases cited or not is, we think, immaterial, because it is conceded by appellant now that the giving costs in equity is within the discretion of the chancellor. And, without deciding the question ¡as to whether, in ¡all cases where the property sold is not sufficient to pay the costs, the person procuring the appointment of the receiver should pay it, we think that the chancellor’s ruling as to costs in this case is correct. The estimated value of the property was more than $89,000. This was purchased by the bank, or by its president as trustee, for $5,500, and this $5,500 for which the property sold is to be used in the payment of the costs, and the appellant required to pay the balance. So it will be seen that the proceeds of the property itself pay $5,500 of the costs, and the appellant has ¡all the property, and the court in its decree stated, “and it is considered, adjudged and decreed that the plaintiff, First National Bank of Clarksville, pay the amount of all costs in excess of the sum of $5,500, the sale price of the property sold by the receiver, and that it be allowed to retain said sum of $5,500, the purchase price of said property, as part payment of the costs of the receivership, as the same appears from the report of the receiver this day approved.”

The court trying the case knew all the facts and circumstances, and evidently adjudged the costs as it thought proper. Moreover, there was no denial of the fact that it was conceded 'by the attorneys that it was proper in this case for the person who brought the sait and obtained the appointment of the receiver to pay whatever costs there was in excess of the value of the property.

This court has many times held that the chancellor might, in the exercise of a sound discretion, apportion the costs according to equitable principles; that equity will apportion the costs according to what the court regards as the applicable equitable principle. The court evidently did that in this case.

This court, discussing the rule as to costs in chancery cases, said:

“Learned counsel for appellee have cited numerous authorities in support of the position that costs are not necessarily adjudged against the losing party in chancery cases, but that the chancellor may, in the exercise of a sound discretion, apportion the costs according to equitable principies when the facts justify. The rule contended for is sound, but is only applied when equities between the various parties warrant it. For example, if one party is at fault more than another, it is proper to distribute the coats according to the fault of each; or, if equally at fault, to divide the costs; or to adjudge the entire costs against the party wholly at fault.” Fry v. White, 132 Ark. 608, 201 S. W. 1105; Paving District No. 5 City of Ft. Smith v. Fernandez, 144 Ark. 550, 223 S. W. 24; Hayes v. Bankers’ & Planters’ Life Association of Ft. Smith, 164 Ark. 202, 261 S. W. 296.

This court has also held that § 1833 of Crawford 6 Moses’ Digest, referred to by appellant, does not apply to equity cases, but that in equity cases the taxing of costs and expenses of a suit is entirely discretionary. Jones v. Adkins, 170 Ark. 298, 280 S. W. 389.

The appellant in its brief states: “The Colorado court has gone so far as to say that when the appointment is improper, if the fund seized is inadequate, the plaintiff who secures the appointment of a receiver, and not the defendant whose property is wrongfully taken from him, is liable for the legitimate expenses of such receivership. Many authorities are cited for the foregoing statement of the law. Among them is that of Judge Taft, in Mercantile T. Co. v. Kanawha, 58 Fed. 6; Bank v. Central C. & C. Co., 115 Fed. 878, 879 ; Tome v. King, 64 Md. 166, 184, 21 Atl. 279; Knickerbocker v. McKinley, etc., 67 Ill. App. 295; Ephraim v. Pacific Bank, 129 Cal. 589, 592, 62 Pac. 177; Welch v. Renshaw, 14 Colo. App. 526, 59 Pac. Rep. 967; Hendrie v. Parry, 37 Colo. 365, 86 Pac. 113, and cases cited.”

But, whether the principles announced in cases cited 'by appellant entirely support the text or not, is immaterial here, because, under our decisions, the taxing of the costs was within the discretion of the chancery court, and in the instant case there was no abuse of discretion. We think it properly taxed the costs.

It is next contended that the lienholders were not entitled to a lien, because they had not complied with the requirements of the statute. They filed their intervention in the receivership case, claiming liens, and the appellant itself stated in its complaint that the laborers unpaid for their labor aggregated about 70 in number, and that some of them had begun suit and already attached the machinery and equipment, :and that others of said laborers would sue and would greatly harass and obstruct the operations of the plant unless a receiver was appointed. Mr. Dunlap, president of appellant bank, stated that lie made 'these statements ; that Mr. Patterson was his lawyer, and he talked it over with him, and that he swore to these statements.

When the appellant took the cars of coal in controversy it knew, according to its own statements, that the laborers had liens for unpaid labor. It knew that the only possible way in which the laborers could be paid was from the proceeds of this property which it took and sold. It therefore took the property and sold it with a knowledge that it was subject to a laborer’s lien, and therefore, in the contest in chancery court, the court properly decided that these liens were superior to the lien of the bank. And we think the contention therefore that the interveners, Pete Barto and his associates, failed to make out their claim of a lien on the ca'rs of coal is without merit. Moreover, on the 18th day of March the court entered a decree which, among other things, stated that it was agreed by and between the attorneys for the interveners and the defendant that the intervener, T. H. McCann, is entitled to a judgment for $180.32 for labor performed. And it was further- agreed that said intervener had a lien on the coal produced out of said mine, and also on mine machinery, tools, implements, etc. The court further said: “But the question of priority of lien as between the intervener and other creditors of the defendant Scranton Coal Company is reserved for further consideration.”

The attorneys then signed this agreement: “It is hereby agreed between attorneys .for intervener and defendant that the above shall be recorded upon the judgment record of the chancery court as a precedent in this case.” Signed by the attorneys for the intervener and attorneys for. defendant; but the attorney for the defendant was also the attorney for the appellant, and there does not seem to be any controversy about these laborers being entitled to enforce their liens in the manner in which they did when the amounts were fixed by the court. In the first place, it was not necessary in a proceeding of this sort, where property had been taken and sold by the appellant, to do more than file an intervention, as the laborers did in this ease. But, even if it had been necessary to comply with all the statutes, we think the record shows conclusively that this requirement was waived, and that the laborers are entitled to their liens as found by the chancellor.

The chancellor found that as to a number of oars there was no evidence of the value at all, and necessarily found against the interveners, or rather declined to find against the appellant, as to these cars. The interveners contend that they were entitled to judgment for the value of these cars.

We are of opinion that the chancellor was correct; that there was no evidence as to the value of these cars, and the burden was upon the parties claiming- a lien to show the value of the property converted by appellant. Having failed to do this, they were not entitled to any judgment for the value of these cars.

The decree of the chancery court will therefore be affirmed, both on appeal and cross-appeal. It is so ordered.