source: Caselaw Access Project

author: McCulloch, C. J.

license: Public Domain

text:
    Jenkins v. Packingtown Realty Company.
    Opinion delivered February 16, 1925.
    Wills — devise to son and wife with remandier to “their children.” — A devise to a son and wife .for their lives with remainder to “their children,” there being no children of such marriage at the testator’s death, did not include the children of the son by a former marriage, but created a contingent remainder in the children of the devisees which became. vested upon the coming into being of a child of such union.
    Appeal from Jefferson Chancery Court; John M. Elliott, Chancellor;
    affirmed.

      F. G. Bridges, W. T. Wooldridge and U. J. Cone, for appellant.
    The words ‘‘their children” as used in the will included the children of the first marriage of James Hayes Jenkins. 40 Cyc. § 1451; 9 Tex Civ. App. 482, 30 S. W. 929 ; 79 Pa. St. 43 and cases cited; 73 Atl. 939; 78 Atl. 58; 64 Atl. 598; 85 Pac. 886; 29 Pa. Sup. Ct. 60, 215 Pa. 344; 175 S. W. 1 (Ky.); 90 Ark. 520. Hazel Brumson Jenkins, having been born four years after the death of the testator, did not take anything under the will, since the estate devised vested immediately after the death of the testator 40 Cyc. 1052. 15- Ark. 632; 90 Ark. 152; 104 Ark. 439; 129 Ark. 250; 104 Ark. 439, 448 ; 28 R C. L. p. 321, § 192; 68 Ark. 369, 375, 376; 115 Ark. 9.

      Rowell é Alexander and Coleman & Gantt, for appellees.
    The will gave a life estate in the land in question to James Hayes Jenkins and Josephine, his wife, with remainder to their children, that is, to the children common to both of them. This remainder interest vested immediately in Hazel Brunson Jenkins, when he was born. As the life tenants are now dead, the appellees, who hold under Hazel Brunson Jenkins, are the owners in fee simple. 187 Mass. 141, 72 N. E. 935; 200 Mass. 77, 85 N.-E. 886; 225 Mass. 427, 114 N. E. 711; 68 N. H. 298, 44 Atl. 520; 76 Tex. 293,13 S. W. 312; 174 N. C. 337, 93 S. E. 842; 75 N. C. 176; 66 N. W. 596; 117 Ind. 380; 20 N. E. 264; 78 N. Y. 275. Under .a devise to A and B, his wife, with remainder in their children, the'children in esse at the death of the testator take a vested interest subject to open up and let those afterwards born before the period of distribution 40 Cye. 1480; 3 Thompson on Real Property p. 191 ;Id. 209; 106 N. E. 879; 73 U.S. 458, 18 L. Ed. 869; Tiedeman, Real, property, § 302; '2 Washburn, Real Property, § 1551; 19 N. E>. 539; 247 111. 543, 93 N. E. 344.
   McCulloch, C. J.

Nathan Jenkins, the grandfather of. appellant, Nathan T. Jenkins, was, at the time'of his death in the year 1868, the owner of a tract of land in Jefferson County, near the city of Pine Bluff, containing 445 acres, and he left his last will and testament whereby he.devised the east half of said property as follows:

“I will and devise the east half of my said plantation to my son James Hayes Jenkins and his wife Josephine, to hold, use and occupy and enjoy for and during the term of their natural lives, for the support and education of their children, and, after their death, ¡to be equally divided between tlieir children, share and share alike. ’ ’

The west half of said plantation was, by the terms of said will, devised to the testator’s son William H. Jenkins and his wife, Sarah Jenkins, “to hold, use and occupy and enjoy during the term of their natural lives, for the education of their children, and, after their death, to belong to their children, share and share alike.”

James Hayes Jenkins, the son of the testator, intermarried with Josephine Mitchell on December 12, 1866, and there was one .child, the issue of that marriage, a son, Hazel Brunson Jenkins, who was born March 19, 1872, and died August 26, 1913. James Hayes Jenkins had six children by a former marriage, five of whom were living at the time of the death of the testator, and one died a few years later, leaving four, including appellant, and two of them conveyed to appellant whatever interest they might have in the lands in controversy. Josephine Jenkins and her son, Hazel Brunson Jenkins, executed to appellee Packingtown Realty Company a deed conveying their interest in the property, and subsequently that grantee executed to appellee Bain Manufacturing Company a deed conveying fifteen acres of the land. James Hayes Jenkins died on January 3, 1878, and Josephine Jenkins died on June 18, 1922. This action was then instituted by appellant against appellees, Packingtown Realty Company and Bain Manufacturing Company, in the circuit court of Jefferson County, setting forth the above facts and praying for the recovery of an undivided three-fourths interest in said property, and for rents and profits by way of damages. The cause was transferred to the chancery court on the, answer and cross-complaint of each of the appellees praying that their title be confirmed. The chancery court, on hearing the cause, rendered a decree dismissing appellant’s complaint for want of equity, and he has prosecuted an appeal to this court.

It is the contention of the appellant that the words “their children,” as used in the will of Nathan Jenkins, included the children of James Hayes Jenkins by his first marriage, and did not include Hazel Brunson Jenkins, who was not born until after the death of the testator; that the effect of the language was to devise a remainder in fee to the said children of James Hayes Jenkins.

On the other hand, it is contended by appellees that the language of the will did not include the children of James Hayes Jenkins by the former marriage, but only included the issue of James Hayes Jenkins and his wife Josephine; that the remainder in fee became vested in Hazel Brunson Jenkins, and that it passed under the conveyance of the latter to appellees. The appeal calls for an examination of the questions thus raised.

There is a divisio’n in the authorities bearing on the interpretation of the language of this will. Counsel for appellant 'cite authorities which support their contention that the words “their children” include the children of a former marriage, but we are of the opinion that this view is contrary to better reason as well as to the weight of authority. Crapo v. Pierce, 187 Mass. 141; Crandall v. Ahearn, 200 Mass. 77; Hersam v. Aetna Life Ins. Co., 225 Mass. 425; Aetna Mutual Life Ins. Co. v. Clough, 68 N. H. 298; Evans v. Opperman, 76 Tex. 293; Brown v. Aetna Life Ins. Co. 174 N. C. 337. The plain meaning of the language is that it relates to the issue of the intermarriage between the two persons mentioned, and not to all of the children of either of the persons so named. As said by the Massachusetts court, in the first of the decisions of that court cited above, the phrase “their children” must be read collectively and not distributively, hence it must be construed to relate to the issue of that particular intermarriage. In other words, the language of the devise is' construed the same as if it had said that the property should be equally divided between children who were born of the marriage of James Hayes Jenkins and his wife Josephine. It is the contention of counsel for appellant that even this interpretation of the will does not help the cause of appellees, for the reason that their grantor, Hazel Brunson Jenkins, was not born until after the death of the testator, and that this rendered the devise of the remainder void, and that the title reverted to the heirs of the testator. "We do not agree with that conclusion, but, on the contrary, we think that the language used by the testator presents a case of a devise in remainder to a class of persons, whether in being at the time or not, and that the remainder vested immediately upon the coming into being of any one of. that class. In other words, we think that the case is one which falls within the rule announced by the Supreme Court of the United States in Doe v. Considine, 6 Wall. (U. S.) 458, as follows:

“A devises to-B for life, remainder tó his children, but, if he dies without leaving children, remainder over, both the remainders are contingent; but, if B afterwards marries and has a child, the remainder becomes vested in that child, subject to open and let in unborn children, and the remainders over are gone forever. The remainder becomes a vested remainder in fee in the child as soon as the child -is born, and does not wait for the parent’s death, and, if the child dies in the lifetime of the parent, the vested estate in remainder descends to his ■heirs.”

This rule finds support among all the text writers. 3 Thompson on Real Property, pp. 191, 209; Tiedeman, Real Property, § 302. Mr. Washburn states the rule as follows:

“Thus, upon the grant of an estate to A, with a remainder to his children, he having none at the time, the remainder will, of course, be a contingent one. But the moment he has a child born, the remainder becomes vested as fully as if it had originally been limited to a living child.” 2 Washburn, Real Property, § 1551.

It seems to be the contention of both parties in the case that an estate for life was devised under the will to James Hayes Jenkins and his wife Josephine. It is unimportant, we think, whether this is true or whether a trust was created. In either event the title vested in fee upon the coming into being of one of the members 'of the class mentioned.

Counsel for appellant, in their contention that the will did not include after-born children, rely upon the decision of this court in Wyman v. Johnson, 68 Ark. 369, but we do not think that the decision in that case is applicable. In that case members of the class mentioned in the will were in being at the time of the execution of that instrument, and, there being nothing to indicate an intention of the testator to include after-born children, it was held that they were not included in the devise. In the present case there was no person in being coming •within the class mentioned in the devise, and, in order to give any effect at all to the devise, it must be presumed that the testator intended to include after-horn children of James Hayes Jenkins and his wife Josephine. It is our duty, if it can reasonably be done from the language used, to give some effect to the devise, and to do so we must say that it was intended to include after-born children. Our conclusion therefore is that the title passed under the will to Hazel Brunson Jenkins, and from him to appellees under his deed to the latter.

There are other questions raised in the case, but it is unnecessary to discuss them, inasmuch as the conclusion hereinbefore announced completely settles the rights of the parties.

Decree affirmed.


author: Humphreys, J. McCulloch, C. J.

text:
    Page v. American Bank of Commerce & Trust Company.
    Opinion delivered January 26. 1925.
    1. Mortgages — construction op clause as to advances. — Where, on the arrival of each shipment of cars to an automobile dealer, the bank loaned him 80 per cent, of the factory price and took notes therefore secured by mortgage on the cars in each shipment, a clause in each mortgage including all other advances by the bank to the dealer up to foreclosure held not intended to cover loans secured by separate mortgages on different property, but to secure advances related and incident to each particular contract and shipment.
    2. Judgment — part op decree not within issues. — Part of a (decree involving a construction of a clause in chattel mortgages in suit, as to claims secured, was void as outside the issues then joined, and so not binding on a second trial, where the only issues involved were usury in and authority to execute some of the notes and mortgages.
    Appeal from Pulaski Chancery Court; John E. Martineau, Chancellor,
    reversed.

      Snodgress & Snodgress, for appellant.
    Since it is uniformly held that these provisions for advances should not be construed to extend beyond the maturity of the notes, the fact that intervener’s note is dated April 15, 1920, and the four usurious notes are dated respectively February 7th, April 3rd, and April 8th, 1921, should alone settle this appeal in favor of the intervener. 50 Arle. 256; 111 Ark. 362; 103 S. W. 692; 152 Ark. 395. No money was ever advanced by appellee at any time except upon a new note, secured by a new mortgage upon the basis of 80 per cent, of factory cost of the automobiles, and not then until the Hollan Auto Company had them insured for the benefit of appellee bank. Clearly the indebtedness contemplated by the advance clause in mortgages can be no other than money, etc., furnished under and incident to each separate contract and not otherwise secured. It cannot be construed to cover deficiencies in settlement of other indebtedness, secured by separate mortgages, as against a third party, holding a second mortgage. 19 N. E. 254; 78 Ark. 141; 103 S. ÍW. 694.

      Moore, Smith, Moore & Trieber, for apellee.
    The notes referred to by appellant were each the last of a series of extension or renewal notes. The original notes, and the three mortgages securing them and relied on by appellee, were executed and delivered January 7, 1920, March 10, 1920 and April 5, 1920, thus antedating appellant’s note and mortgage, so far as other or further advances are concerned, these mortgages take effect from the date of their execution, giving the bank priority for all such sums as are secured by them.
    It is well established that where a mortgage is given to secure two separate indebtednesses, one of which is usurious, and the other free from usury, the mortgage is valid and will stand as security for the non-usurious indebtedness. 65 Ark. 316.
    Appellant’s contention to the effect that the deficiency indebtedness cannot be treated as having been secured by the mortgages in question, for the reason that in each case they were secured by other and separate mortgages, is not sustained by any authorities we have been .able to discover, nor by'the cases cited by appellant. And his contention that this court has uniformly held that a provision in a mortgage as to advances cannot he construed to cover advances made beyond the maturity of the main note secured is also erroneous. 152 Ark. 395; 122 Ark. 457; 66 Ark. 393.
    The question involved here is res judicata by virtue of the decree rendered by the chancery court in the original suit, to which appellant - was made a party, entered his appearance and filed his intervention. The very question which is now contested by appellant was judicially determined in that decree. 141 Ark. 453; 156 Ark. 139".
   Humphreys, J.

This case is before us on a second appeal, and,- for a partial statement of the facts, reference is made to the opinion rendered on the first appeal, under style of Hollan v. American Bank of Commerce & Trust Co., 159 Ark. 141. The transcript in that case was, by agreement, adopted by the parties as a partial transcript in this ease. Appellant herein was a party in the original suit, .and, by intervention, claimed a first mortgage on several of the automobiles and second mortgage on a number of automobiles.upon which the American Bank of Commerce & Trust Company claimed the first mortgage. The single question involved on the first appeal was whether the notes and mortgages executed by Claude L. Hollan for the Hollan Auto Company, covering the automobiles, were usurious and void. According to the testimony and pleadings in the first trial of the cause, only two issues were involved, that of usury and whether the Hollan Auto Company was bound by the act of Claude L. Hollan in executing said notes and mortgages to the bank. On the former trial this court declared the second, third and fourth loans usurious, and reversed and remanded the cause, with directions to enter a decree declaring those loans null and void, and for further proceedings not inconsistent with the opinion.

Upon the remand of the cause, the Hollan Auto Company moved for restitution of the automobiles or the value thereof, covered by the usurious mortgages, and appellant, the intervener, moved that the proceeds from the sales of the automobiles covered by the usurious notes and mortgages be applied on the payment of his note and mortgage which covered the same automobiles. During the pendency of the first appeal the automobiles embraced in the usurious mortgages, as well as those embraced in the valid mortgages, were sold to appellee. The automobiles embraeed in the usurious mortgages brought $5,030 at said sale. When the second, third and fourth loans were declared usurious and void, pursuant to the mandate of this court, it left a deficiency payment due appellee of $3,803.02 on account of the failure of the automobiles embraced in the valid mortgages to bring a sufficient amount to liquidate the judgment rendered on the valid loans held by said appellee against the Hollan Automobile Company.

Appellee defended against the motion for restitution of the fund derived from the sale of the automobiles embraced in the usurious mortgages, to the extent of this deficiency judgment, on the ground that the mortgages securing its notes contained the following clause: “* * * for all other moneys, advances, goods, wares, merchandise, supplies, services, etc., furnished by the party of the second part (the bank) to the party of the first part (Hollan Auto Company) up to the foreclosure of this instrument, with interest at the rate of eight per cent, per annum from date of furnishing until paid. ’ ’

Upon the issues stated and the testimony adduced, the court rendeded a decree in favor of appellant upon his note and mortgage for $4,500 and interest against the Hollan Auto Company, with a lien upon the fund arising from the sale of the automobiles, subject, however, to a prior and paramount lien thereon in favor of the appellee bank for its deficiency judgment in the sum of $3,803.02. The court then deducted the deficiency judgment from the amount of $5,030, which bid it made for the automobiles embraced in the usurious mortgages, and rendered a decree against appellee for $1,226.98 in favor of appellant, from which he has appealed.

The trial court construed the clause for advances in the mortgages to appellee as securing any deficiency between the debt and the amount derived from the sale of the automobiles covered by each mortgage, and, under these clauses in the usurious mortgages, and the wording of the original decree, declared a priority for the deficiency between the debt and the fund derived from the sale of the automobiles, embraced in the valid mortgages. The record reflects that each of the loans made by appellee to the Hollan Auto Company was a separate and independent loan upon the 'basis of eighty per cent, of the factory cost or invoice price of the automobiles, secured by separate mortgages, and which were separately insured against fires in favor of appellee as its interest might appear. The course of business was that, when shipment of two or three cars would arrive, the bank would make a loan of eig’hty per cent, of the factory cost of the ears contained in the shipment, to enable the Hollan Auto Company to get them from the railroad, and take a note payable in thirty days secured by mortgage on each particular shipment. We think the proper interpretation of the clause for advances in the several mortgages was to secure any additional advances which appellee might make on any particular shipment, and not to secure independent loans secured by other mortgages on independent shipments. The clause was not intended to cover loans secured by separate mortgages on entirely different property, but to secure advances related and incident to each particular contract and shipment.

Appellee contends, however, that the construction of this clause in the several mortgages was adjudicated in the first trial of the cause, as evidenced by the decree rendered on December 13, 1921. It is insisted that the whole question involved in this cause is res judicata by virtue of the following paragraph in said decree: •

“The plaintiff, (bank) has a further lien upon each of the automobiles described in the foregoing paragraphs in this decree, numbered 2, 3, 4, 5 and 6, to secure the payment of the sums mentioned in each and every one of said paragraphs, and in paragraph 7 of this decree, or any deficiency left upon any of said sums,, after applying thereupon the proceeds of the automobiles specifically pledged to secure the same.” This, and other like clauses in the decree of date December 13, 1921, was not within the issues joined, and is consequently void. The only issues pleaded and tried out originally were usury and whether Hollan had authority to execute the notes and mortgages to appellee. The issue as to the meaning of the clause for advances was not joined and tried out until the decree was reversed and the cause remanded for further, proceedings. Even then appellee did not plead res judicata, and it seems not to have been thought of until the last decree, from which this appeal is prosecuted, was entered.

On account of the error indicated the decree is reversed, and the cause is remanded with instructions to render a judgment in favor of appellant against appellee for the proceeds derived from the sale of the automobiles covered by the usurious mortgages, to the extent of his debt and accumulated interest.

DISSENTING OPINION.

McCulloch, C. J.

The only issue raised in the pleadings in the 'Original trial of the cause was, as correctly stated in the 'opinion of the majority, the issue .of usury, and the reason that the issue was thus restricted was that neither mortgagor, Hollan, nor the present appellant, Page, tendered any other issue in their respective pleas. Appellant was made party defendant as a junior lienor, was served with summons and after being brought into the case filed interplea claiming a lien under his mortgage, which was junior in point of time to the mortgages executed to appellee. The trial court decided the only issue in the case (usury) against both the defendant and the intervener and rendered a decree in favor of appellee, in accordance with its complaint, declaring a lien on all the property embraced in each of the mortgages for all of the various debts described in the mortgages. This constituted a distinct adjudication of the priority of the mortgages to appellee over the junior mortgage to appellant, Page.

The effect of this adjudication cannot be escaped merely because the appellant and the other def endant in the case failed to make the question of priority an issue. The rule established by this court and all other courts is that a former adjudication is a bar, in a subsequent suit, as to all issues which were determined or which could have been determined and that it is the duty of a defendant to tender all the defenses which are available, otherwise he will be barred by the adjudication. Ederheimer v. Carson Dry Goods Co. 105 Ark. 488; Jimmerson v. Fordyce Lumber Co. 119 Ark. 413; McDaniel v. Richards. 141 Ark. 453; Toll v. Toll, 156 Ark. 139.

The present appellant, Mr. Page, did not appeal from the original decree and did not attempt to contest appellee’s right of priority until the case was remanded to the trial court for further proceedings. His sole attitude in the case up to that time was such as to make him the recipient of benefit under Hollan’s plea of usury, which was sustained by this court, and to that extent the present appellant was benefited.

As to the original question of priority, I am also of the opinion that the decree in favor of appellee was correct, for each of the mortgages to appellee contained a provision securing, not only the particular note or notes described therein, but “all other moneys and advances, goods, wares, merchandise, supplies, services, etc., furnished by the party of the second part to the party of the first part up to the foreclosure of this instrument.” The language brings the instrument within the rule often 'announced -by this court sustaining mortgages containing similar provisions. Moore v. Terry, 66 Ark. 393; Word v. Cole, 122 Ark. 457; Patterson v. Ogles, 152 Ark. 395.

The majority say that “the proper interpretation of the clause for advances in the several mortgages was to secure any additional advances which appellee might make on any particular shipment, and. not to secure independent loans secured by other mortgages on independent shipments.” How they reach that conclusion I am unable to see, for this view appears to me to be directly in conflict with the cases cited above. The parties had the right to make their own contract, and the restriction placed on the language by the majority seems to me to be entirely unwarranted.

My conclusion, therefore, is that under either theory the decree of the chancery court was correct and should be affirmed.

I am authorized to say that Mr. Justice Smith agrees with me in the views I have expressed.


text:
    State v. Margay Oil Corporation. State v. Enfisco Oil Corporation.
    Opinion delivered February 2, 1925.
    1. Taxation — validity of franchise tax. — Acts 1923, p. 317, providing that for the purpose of the franchise tax the par value of the stock of corporations without nominal or par value “shall be itaken to be of the value of $25 each,” does not impose a tax upon property of foreign corporations outside the State, since Crawford & Moses’ Dig., § 9802, provides that foreign corporations shall pay such tax only upon the proportion of the subscribed stock employed within the State.
    2. Taxation — burden on interstate commerce. — Acts 1923, p. 317, imposing a franchise tax upon the corporate stock of foreign corporations in proportion to the subscribed stock employed within the State, does not impose a burden upon interstate commerce.

      3. Taxation — -power of state to classify property. — The State may make reasonable classifications of corporations for the purpose of regulation or taxation, and such classification will not be overturned by the court if all corporations of the same class are treated alike.
    4. Taxation — franchise tax — discrimination.—Acts 1923, p. 317, valuing the stock of all foreign and domestic corporations having no par value at $25 per share for the purpose merely of the franchse tax, -is not invalid as discriminatory as compared with corporation of par value -having the same amount -of assets, since the former corporations voluntarily accepted the statutory basis of valuation in preference -to stating the value of their shares in the certificate.
    5. Taxation — franchise tax — confiscation.—It cannot be contended that Acts 1923, p. 317, valuing the stock of all non-par -corporations, for the purpose of the franchise tax, at $25 per -share, is confiscatory, since only that portion of their stock is taxable which represents the investment and ownership of property in this State.
    6. Taxation — power of state to fix value of corporate franchise. — The State has the power to fix the method of ascertaining the value of a franchise and imposing u -tax on that basis, provided it is a fair and just basis.
    Appeal from Pulaski Chancery Court; John, E. Martineau, Chancellor;
    reversed

      J. 8. Utley, Attorney General; 8am M. Wassell, of counsel, for .appellant.
    The tax involved in this case is not a property tax, but only a franchise tax. 19 Cyc. 1456, 1463, and cases cited; 153 Ark. 114; 160 Ark. 17; 5 Ark. 591. On the question of the limits to which -the Legislature may or may not g*o in the matter of establishing franchise or charter fees to be collected from corporations, foreign and domestic, in this State, for the franchise or right of conducting their operations within the State, .and the construction of such statutes with reference to their constitutionality, see 82 Ark. 309; 2 Lewis’ Sutherland on Statutory Construction, 948; 63 Ark. 576; Cooley’s Constitutional Limitations, 6th, ed., 218; 3 Thompson on Corporation, 2nd ed. § 2921; 134 TJ. S. 594; 51 N. E. 924; 29 N. E. 812. The matter of fixing a franchise tax is solely within the province of the Legislature, and objectors should seek relief from that body and not from the courts. 33 L. ed. U. S. Sup. Ct. Reports 594; 155 U. S. 648. Whereas the law of Delaware, under which appellee companies were incorporated, fixes a value of $100 per share on certificates of stock of non-parwalue, the act 367, Acts 1923, gives the non-par-value share the merely nominal value of $25, which is evidence that the State is not attempting to act arbitrarily, capriciously, or in such manner as to effect a confiscation of property. 14th Amendment, IT. S. Const.; Ill TJ. S. 704, 28 L. ed. 569; Hall’s Cases on Constitutional Law, 408; 153 Ark. 114; 160 Ark. 17. The requirement as to equality and uniformity applies only to taxes in the popular sense of the word, levied with the object of raising revenue for general purposes, and not to such as of an extraordinary and unusual kind, or to burdens, charges or impositions which are not, properly speaking, taxes. 37 Cyc. 731-2. Taxation is at best an approximation, and perfect equality, however desirable, is neither demanded nor expected. 181 U. S. 396-8, 45 L. ed. 914; 251 U. S. 182; 256 US. 242, 65 L. ed. 1139; 260 TJ. S. 519-530; 235 U. S. 350; 200 U. S. 226. The act provides that all non-par-value shares of stock, for the purpose of assessing franchise fees or taxes only, shall be uniform. The Constitution authorizes classification for this purpose. Art. 16, § 5, Const. 1874 ; 63 Ark. 576. There is a defect of parties here in that the Railroad Commission, who established the tax, were not made parties. They are necessary parties. 180 N. W. 633; 75 So. 491; 72 So. 996; C. & M. Digest, § 9802-34.

      Bose, Hemingway, Cantrell & Loughborough, for appellee.
    1. The act is invalid because it is violative of Amendment No. 14 of the Constitution of the United States, and of 8 to 21, art. 2, of the Constitution of this State, in that it deprives the plaintiff of it property without due process of law, by taxing the property of the plaintiff which is outside .of this . State, and because it is arbitrary and confiscatory. 216 U. S. 1; Id. 147; 245 tT. S. 178; 246 U. S. 144; 235 U. S. 362;
    2. It is invalid because violation of Amendment No. 14, supra, in that it deprives the plaintiff of the equal protection of the laws, by increasing the. rate of taxation upon foreign corporations having no par-value stock, without a similar increase as to domestic corporation, and by taxing the plaintiff at a higher rate than is applied to .other corporations, domestic and foreign, not having non-par-value stock, and by taxing plaintiff at a higher rate than is applied to other corporations domestic and foreign, not having non-par-value stock and by taxing plaintiff at a higher rate than is applied to other corporations having non-par-value stock divided into smaller shares. 165 IT. S. 150; 134 IT. S. '232; 79 N. E. 884; 195 N. Y. S. 184; Airway Electric Appliance Corporation v. Day, treasurer of Ohio, 266 U. S. 71.
    3. Foreign corporations with non-par stock could be taxed without the act 367. 221 S. W. 728; 181 Pao. 625; 250 S. W. 293.
   McCulloch, C. J.

The appellee in each of these two cases is a foreign corporation whose stock does not express any par value, the stock of each of the corporations being what is termed non-par-value stock. Each of the corporations entered the State several years ago and paid its respective franchise tax up to the year 1923, when the present controversy arose over the basis on which the franchise tax should be imposed, and these actions were instituted by appellee to restrain the Attorney General from enforcing what is claimed by appellees to be unjust exactions with respect to this tax.

The General Assembly of 1923 enacted a statute (General Acts 1923, p. 190) authorizing the formation or reorganization or merger of corporations with shares of stock without nominal or par value.. Section 8 of that statute provides that the annual franchise tax on a corporation having shares without nominal or par value “shall be treated and considered as having and being of the value actually received by the corporation for the issuance of such shares.” Later, during the same session of the General Assembly, another statute was enacted (Acts 1923, p. 317), which prescribed a schedule of fees for filing articles of incorporation and also a schedule of franchise taxes, and one of the sections of that statute, after referring to the other statute just referred to, relating to corporations operating thereunder, provided that “for the purpose of the taxes or fees prescribed by law to be paid on the filing of any certificate or other paper relating to corporations and of franchise taxes prescribed by law be paid by corporations to the State of Arkansas, but for no other purpose, such shares shall be taken to be of the par value of twenty-five dollars each.”

Each of the appellees filed with the Railroad Commission, which is now the Tax Commission of the State, its annual report for the year 1923, pursuant to the statute (Crawford & Moses’ Digest, § 9802), includina:. among other things, the number of shares of its subscribed and paid-up capital stock and the value of same, and the value of its property owned and used in this State, as well as the value of its property owned and used outside of the State.

Section 9804, Crawford & Moses’ Digest, provides that, upon the filing of a report by a corporation, the Commission “from the facts thus reported and any other facts coming to its knowledge bearing upon the question, shall determine the proportion of the authorized capital stock of the corporation represented by its property and business in this State,” and shall report the same to the Auditor of State, who shall charge and certify it to the Treasurer, and that a tax of “one-tenth of one per cent, each year upon the proportion of the subscribed, issued and outstanding capital stock of the corporation represented by property owned and used in 'business transacted in this State” shall be charged.

The act of 1923, supra, provides that the franchise Tax of corporations shall be ‘ ‘ one-tenth of one per cent, each year upon the proportion of the subscribed, issued and outstanding capital stock o.f the corporation employed in Arkansas.” Pursuant to these statutes, the Railroad Commission certified to the Auditor the franchise tax of each of appellee corporations for the year 1923. Appellee Margay Oil Corporation showed by its report the valuation of property owned and used in the State of Arkansas in the sum of $200,000, and the Commission in fixing the amount of its franchise tax figured the shares of capital stock at twenty-five dollars per share, in accordance with the statute, on the basis of the same proportion as the value of the property situated in Arkansas bears to the value of the entire property of the corporation. This made- the tax on that corporation the sum of $2,580.42, and made the tax on the other appellee, figured on the same basis, the sum of $2,549.35.

Appellees in this suit attack the validity of the statute fixing the basis of valuation of non-par-value stock. The Commission followed the terms of the statute in fixing the amount of the tax, so the case turns on the question, of the validity of the -statute.

The only method by which the statutory requirement, in basing the t-ax upon “the proportion of the subscribed, issued and outstanding capital stock of the corporation employed in Arkansas,” can be complied with is to do as the Commission did in computing the proportion upon the same ratio as the value of the property in Arkansas bears to the total value of all the property of the corporation.

Appellees attack the validity of the statute as in conflict with the Constitution of the United States and the Constitution of the State, on the ground that it constitutes a denial of due process of law by taxing the property of corporations outside -of the State and in discriminating against them by prescribing a meth-pd of taxation, at a higher rate than is applied to other corporations, domestic and foreign, not having par-value stock, and by taxing them at a higher rate than is applied to other foreign corporations not having non-par-value stock divided into a smaller number of shares.

We are unable to preceive any theory upon which it can be claimed that the prescribed statutory method of fixing the tax constitutes an imposition of the tax on property of either of appellee corporations situated outside of the State. If it be conceded that the statute is invalid because it adopts the wrong method of taxation, it is not true that the tax imposition reaches to property outside of the State. The statute expressly provides, as we have already seen, that the fee shall be based upon the proportion of subscribed stock of the corporation employed in Arkansas. Property outside of the State is not taxed at all under this method, and is not considered except for the purpose of determining the proportion of the non-par-value stock representing the property in this State. Learned counsel for appellees cite numerous decisions of the Supreme Court of the United States establishing the rule that it is beyond the power of the State, under any guise whatever, to tax property outside of the State, or to levy franchise taxes based upon property outside of the State, or to burden interstate commerce by taxation, but those cases have no application here, for the reason, as before stated, that this statute does not purport to tax property outside of the State nor. to burden interstate commerce, and does not, in fact, bring about that result. The same principle is applicable as that which seemed to control the Supreme Court of-the United States in the following cases: Wallace v. Hines, 253 U. S. 66; Underwood Typewriter Co. v. Chamberlain, 254 U. S. 113; Hump Hairpin Co. v. Emmerson, 258 U. S. 290; Bass, Ratcliff & Gretton v. Taos Commission, 266 U. S. 271, 45 Sup. Ct. Reporter, 82.

The effect of the statute is simply to provide a definite method for fixing the franchise tax, and, unless it is found that it is confiscatory in its effect, nr that it results in a method whereby the tax is imposed upon property outside of the State, or is a burden upon interstate commerce, it is not open to attack.

The power of the State to make reasonable classifications for purposes of regulation or of taxation has been often decided and never denied, and such .classifica7 tions will not be overturned by the court if all corporations of the same class are treated alike. St. L. I. M. & S. Ry. Co. v. Paul, 64 Ark. 83; St L. I. M. & So. Ry. Co. v. State, 86 Ark. 518; Arkansas Stave Co. v. State, 94 Ark. 27. The statute under consideration applies equally to all corporations organized on the same basis, both domestic and foreign, that is to say, corporations with non-par-value stock. It may be true, as urged by counsel for appellees, and as shown by illustrations in the brief, that the statute may work a difference in the amount of tax as between corporations having the same amount of assets, but this argument is answered by the fact that a corporation may choose for itself whether it shall or shall not bring itself within the terms of this statute. It is a voluntary act of the corporation in accepting the statutory basis of par-value, rather than to express a value in the face of the certificate. Such statutes are not uncommon, but, on the contrary, are in vogue in a great many of the States, such statutes generally prescribing a par value of one hundred dollars. Similar statutes have been upheld in Michigan and Illinois. Detroit Mortgage Corporation v. Secretary of State, 211 Mich, 320, 178 N. W. 697; Roberts & Schaefer Co. v. Emmerson (Ill.), 144 N. E. 818. Our statute, however, fixes the value at twenty-five dollars, which is the par value of the stock of corporations organized under general statute. It is not without interest to note that in the State of Delaware, where both of these corporations are organized, there is a statute fixing the value of non-par-value stock at one hundred dollars. Nor is there any force in the contention of counsel that the statute, -as applied to the total shares -of -stock, is invalid because it fixes the par-value of the capital stock at a sum enormously in excess of the actual value of the assets of the corporation as shown by its annual report to the Railroad Commision. It will be noted, as we have already seen, that the tax is not based upon the total value of the stock, but only that portion of it which represents the investment and ownership of property in this State, and it will be seen that this statute applies alike to all corporations, domestic and foreign, which operate on the non-par-value basis. There is no unfair discrimination against that kind of a corporation. The statute does not, in any view, constitute a violation of § 6, art. 12, of the Constitution of the State, since it is seen that there is no element of confiscation involved in its effect.

The State has the power to fix the method of ascertaining the value of a franchise and imposing a tax on. that basis, if it is a fair and just basis.

We fail to discover any grounds for attack upon the validity of this statute, and as its terms were complied with in the imposition of the tax against each of the appellees, it follows that the decree of the chancery court restraining the State’s officers from enforcing this tax was erroneous. Therefore the decree in each case is reversed, and the cause remanded for further proceedings not inconsistent with this opinion.


author: Hart, J.,

text:
    Holcomb v. Mullin.
    Opinion delivered February 2, 1925.
    1. Wills — specific legacies and devises. — A specific legacy or devise is a gift by will of a specific article or part of a testator’s estate which is identified and distinguished from all other parts of the same kind, and which may be satisfied only by delivery of the particular thing.
    2. Wills — specific legacies and devises. — Specific legacies and devises stand upon the same footing, and will be required to contribute ratably for payment of debts and charges against the testator’s estate.

      3. Dower — widow's share in personalty. — A testator’s widow, against whom he had a divorce suit pending, but which had not been disposed of at his death, was entitled to one-half of his personal estate, including the amount of a specific legacy of the testator’s money in a bank, under Crawford & Moses’ Dig., § 3536, where there were no children of the testator.
    Appeal from Miller Circuit Court; J. H. McCollum, Judge;
    reversed.
    STATEMENT OE EACTS.
    This is an appeal from the judgment of the circuit court settling the estate of Cornelius L. Mullin, deceased, and holding that the specific devises should he first exhausted in the payment of the debts of the decedent before the specific legacies to Joe Mullins should be used. The decedent died on the 2d day of February, 1922, having made a will on February 1, 1922. Omitting the formal parts, the will is as follows:
    “I. It is my will that all my just debts and funeral expenses be paid as soon after my death as can be conveniently done by my executor.
    “II. I give and devise arid bequeath to my nephew, Cornelius Holden, my home place, known as Los Robles, described as follows: The Wy2 Ey2 S W% section 10, township 15 south, range 28 west, in Miller County, Arkansas, save and except six acres sold to Susan Boatman ; provided he makes Los Robles his home; including all the personal property belonging to said farm.
    “III. In the event said Cornelius Holden elects not to accept said Los Robles upon the conditions, then I give, devise and bequeath said farm and personal property to "William Holden, Junior, in fee simple.
    “IV. To my sister, Annie, now Annie Reed, of Oxford, New York, I give, devise and bequeath the east half of lots numbered 5 and 6, in block numbered 25, in the city of Texarkana, Miller County, Arkansas, which is my apartment house.
    . “V. To my sister Nellie, now Nellie Holcomb, of Tie Plant, Arkansas, I give, devise and bequeath lots four (4) and five (5), in block numbered two (2), in Goldberg’s Addition to the city of Texarkana, Arkansas, on which is located two bungalows.
    “VI. To my dear Uncle, Joe Mullin, who raised and fostered my sister and me, I give,'devise and bequeath all the money I may have on deposit at any bank at the time of my death.
    “VII. All the rest of my property, real, personal or mixed, wherever located, I give, devise and bequeath to my sister Catherine, now Catherine Holden, of Orlean, New York, in fee simple.
    “VIII. I hereby nominate and appoint B. E. Holcomb .and F. W. Schifflin as executors of this my last will and testament.”
    On March 5, 1923, the executors named in the will filed their first and final settlement.
    It appears from the record that the money he had on. deposit in the bank at the date of his death amounted to $565.35. The executors turned over to the devisees personal property amounting to $361.50, at the appraised value, which was the reasonable market value for it. They sold other personal property for $92.92, which was its reasonable market value. The probate court allowed claims against said estate to the amount of $1,339.87. The cost of administration amounted to $157.35. The executors reported that they had paid the inheritance taxes due the State of Arkansas in the sum of $204.16. The executors also reported to the probate court in their settlement that they had used the $565.35 on deposit in the bank in the payment of the claims probated against the decedent. With the consent of the devisees named in the will, the executors took charge of the real estate and rented it out until the balance of the debts against the estate were paid.
    It appears from the record that Cornelius L. Mullin had a wife from whom he was separated, and that he had a divorce suit pending against her in Miller County, Arkansas, at the time of his death. They had no children. After his death, the executors and devisees in the will settled with Mrs. Mullin for her dower interest for $10,000. The money was put up by the devisees named in the will. Joe Mnllin took no part in the matter at all.
    Joe Mullin filed exceptions to the settlement, and claimed that the real estate should be preferred in the payment of the debts of the decedent, and that the application of his specific legacy to the payment of the debts should be postponed until the real estate had been first exhausted.
    The probate court approved the settlement of the executors, and judgment was rendered accordingly. Upon appeal to the circuit court, the case was heard upon facts substantially as above set forth. The circuit court was of the opinion that the executors should have first used the rents from the real estate in the payment of the debts, and .found that the specific legacy to Joe Mullin should have been paid to him by the executors. Judgment was rendered accordingly in'his favor against the executors for the sum of $565.35, the amount of money-on deposit in the bank to the credit of Cornelius L. Mullin at the time of his death. From the judgment rendered the executors have -duly prosecuted an appeal to this court.

      G. G. Pope and Will Steel, -for appellant.
    TJhe widow was entitled to her dower interest in the estate of her deceased husband. §§ 35-36 C. & M. Digest; 117 Ark. 142. The testator could not, by will, relieve his land br other property from liability for his debts. 96 Ark. 222. Where the personal property of the estate is insufficient to pay the debts of the estate the lands and tenements in the bands of the administrator are only assets for the payment of the debts. 114 Ark. 1; 157 Ark. 569; 150 Ark. 275.

      Rodgers $ Rodgers and H. M. Ramey, for appellee.
   Hart, J.,

(after stating the facts). A specific legacy or devise is a gift by will of a specific article or part of the testator’s estate, which is identified and distinguished from all other parts of the -same kind, and which may be satisfied only by the delivery of the particular thing. 28 R. C. L., pp. 289 and 291; Kenaday v. Sinnott, 179 U. S. 606; case note to 11 L. R. A. ( N. S.) p. 55; and case note to 10 Ann. Cas. p. 490. Tested by the definition just stated, the legacy to Joe Mullin was a specific legacy, and the various devises in the will were specific devises.

This brings us to a consideration of which is entitled to preference over the other, if any, in the payment of the debts of the decedent. Prof. Pomeroy says that whenever it becomes necessary to resort to th© class composed of the specific legacies and devises, all the legacies and devises in that class will abate pro rata. That specific legacies and devises stand upon the same footing, are subject to the same liability, are abated together under the same circumstances, and contribute ratably for the payment of debts and charges. Pomeroy’s Eq. Jur., 3d. ed., vol. 3, § 1137.

In the case of Brant v. Brant, 40 Mo. 266, the testator, by his will, directed his executors to pay off and discharge all of his debts out of his estate as soon as it could conveniently be done after his decease. He then bequeathed and devised his estate by specific leg-aeies and devises to his wife and his children in nearly equal parts. Plis executors paid off the debts from the rents of the real estate. Upon a bill to marshal assets, the court held that, as the testator had designated no specific fund from which the debts .were to be paid, it was his intention that the devisees and legatees should contribute ratably to the abatement of the incumbrance, and that the whole burden of the debts could not be thrown upon the personal estate. The court recognized that, if a man dies intestate, owing debts, payment will be made in the regular order pointed out by the statute, commencing with the personal property.

On the other hand, the court said that if he devises and bequeaths his whole property specifically, both real and personal, it is an indication that the objects or recipients of his bounty shall have the estate in the proportions designated in the will. There, as here, the testator had made specific gifts of personal property and specific devises of real property, and there were debts probated against the estate which could not be paid without using either the specific legacies or specific devises for such purpose. In such case, if the law should step in and make a distinction where the testator had made none, and where he had specifically designated each particular species of personal property and parcel of land, which should go to the various persons named in his will, the rule would make a very different will for the. testator from that prepared by himself.

In this case, as in that, the testator commenced his will with a general direction to the executors to pay his debts as soon as it could conveniently be done after his death. His whole estate was disposed of by specific devises and bequests, and, as no specific fund was designated and set apart for the payment of the debts, the natural presumption is that he intended that the devisees and legatees should contribute ratably to their abatement.

In the case before us the testator made his will one day and died the next day. It may be presumed that he knew about how much money he had in bank and the approximate value of his other personal property. It will also be presumed that he knew approximately, at least, the amount of debts which he owed. So in this case, if he had intended for his personal property to be applied first to the payment of' his debts, he had just as well not have made a specific legacy to Joe Mullin of the money he had in bank, for he knew that his other personal property was not sufficient for the payment of his debts. Therefore the rule is reasonable and just that specific devises of land and specific bequests of personalty must abate ratably in case of a deficiency of assets for the payment of the debts of the testator, because both land and personal property, under our statute, may be liable for such debts; and it was equally the intention of the testator that the legatee should have the money in bank and the devisees the particular tract of land left to each of them. Armstrong’s Appeal, 63 Penn. 312; and O’Day v. O’Day, 193 Mo. 62, 91 S. W. 921, 4 L. R. A. (N. S.) 922.

We concur with, the reasoning of those opinions that the just manner of construing the will is to give it such an application that the plans of the testator in the distribution of his estate shall be fairly carried out and no disappointment shall happen to those who appear to have been equally the objects of his bounty Of course this rule applies to specific devises and specific legacies, and not to the residuary clause of a will. Therefore we hold that, in marshaling assets for the payment of the debts of the testator, specific legacies of personal property abate proportionately with specific devises of land.

Another matter must be considered in the premises. The record shows that the testator had a wife living at the time of his death. It is true that he had a divorce suit pending against her, but it had not been disposed of. His widow made demand of the executors for a settlement of her dower.- This court has held that a widow is entitled to dower in kind out of the dioses in action of her deceased husband. Sharp v. Himes, 129 Ark. 327.

Hence the widow was entitled to dower in the specific legacy of Joe Mullin.. There being no children, she was entitled to one-half of this amount. -Crawford & Moses’ Digest, § 3536. The result of our views is that the circuit court erred in rendering judgment against the executors for the whole amount of the legacy of Joe Mullin, and for that error the judgment will be reversed, and the cause remanded with directions to allow one-half of the amount of this legacy as -dower to the widow, and to abate the balance proportionately with the specific devises of land in the payment of the -debts probated against the estate of the decedent and the costs of administration,' and for further proceedings according to law and not inconsistent with this opinion.


author: Hart, J.

text:
    Moraz v. Melton.
    Opinion delivered February 2, 1925.
    1. Frauds, statute of — intention of parties. — In determining whether an oral promise to pay another’s debt is original or collateral, the intention of the parties at the time it was made must be' regarded, in determining which the words of the promise, the situation of the parties, and all the circumstances attending the transaction should be considered.
    2. Frauds, statute of — original promise — evidence.—In an action to recover the price of coal bought by the company for which defendant was working, evidence held to sustain a finding that defendant’s oral promise to pay for the coal was original, and not merely collateral within the statute of frauds.
    Appeal from Franklin Circuit Court, Ozark District; James Cochran, Judge;
    affirmed.
    STATEMENT OE EAOTS.
    C. L. Melton sued E. A. Moraz and John Dunkin to recover $308.66, alleged to he due for coal sold by the plaintiff to the defendant. The plaintiff also obtained a writ of attachment on the ground that the defendants were nonresidents and were about to remove their property out of the State without leaving sufficient property therein to pay their debts. This attachment was levied upon certain personal property belonging to E. A. Moraz.
    The defendants denied that they were-indebted to the plaintiff in any amount whatever for coal sold by him to them, or either of them. By way of cross-complaint they alleged that they were the owners of the drilling equipment upon which the writ of attachment had been levied, and claimed damages on account of their drilling operation having been suspended by the seizure of the property under it.
    The -case was tried before the circuit court sitting as a jury. The plaintiff was the principal witness for himself. According to his testimony, he was in the coal business in 1921, at Alix, Arkansas, and sold to the. defendant, E. A. Moraz, three cars of coal, and there was due and unpaid on the purchase price of two cars of said coal $303.66. These two cars of coal had originally been sold to a corporation, and the original bills of lading show that they had been consigned to the said corporation. The first car was shipped October 29,1921, and the amount due on it was $166.66. The second car was shipped November 25, 1921, and the amount due on it was $142. When the second car arrived at Mulberry, Arkansas, the plaintiff called the station agent by telephone and told him to hold the car until his arrival. Upon the arrival of the plaintiff at Mulberry, he refused to let Moraz, who represented l.hc corporation to which the coal was consigned, unload the car. Moraz said, “If you will let me have this car of coal, I will see that you get paid for your coal if it takes the last shirt off my back.” The plaintiff relied on the assertion, and let Moraz have the car of coal. The testimony.of the plaintiff is in narrative form in the bill of exceptions, and we copy from it the following:
    “That he would (not have given Moraz permission to unload the second ear of coal shipped, which was evidenced by the bill of lading marked ‘ Exhibit B, ’ the same being one of the two cars the price of which is being sued for herein, unless Moraz had agreed to pay for all the coal witness had sold the Dunkin-0’Brien Oil Company, and also to pay for this particular car. That said Moraz repeatedly agreed to pay for all the coal he (Melton) sold the Dunkin-0 ’Brien Oil Company. Witness asserted that he let Moraz have the car of coal — the one he promised to pay for — and at the same time promised to pay for all the coal the Dunkin-0’Brien Oil Company owed for. The said car of coal that Moraz agred to pay for at the time he agreed to pay for all the coal the Dunkin0’Brien Oil Company had received was sold to Moraz for the ¡same figure it was sold to the oil company for, i. e., it was sold to the Dunkin-0’Brien Company for $142.50, and that was the price Moraz was to pay for it.”
    We copy from the redirect examination of the plaintiff the following:

      “Witness stated that he looked to Moraz for the amount due on the coal; that said Moraz agreed to pay for it. That, in the Farmers’ and Merchants’ Bank of Mulberry, Moraz said if he (Melton) would let him unload the car of coal then on the aiding in Mulberry, he (Moraz) would pay for all the coal the Dunkin-0’Brien Company had received; that Mr. Henry Moore was called tó witness the agreement after the agreement had been made.”
    ft. A. Moraz was the principal witness for the defendants. He denied having promised to .pay for the coal, as testified to by the plaintiff, and also gave testimony as to the amount of damages suffered by the levying of the attachment on his drilling equipment.
    The circuit court found for the plaintiff in the sum of $112, and judgment was rendered against the defendant, R. A. Moraz, for said sum. The case is here on appeal.

      Joseph B. Brown, for appellant.
    Findings of fact by a court, the same as by a jury, to stand on appeal must be based on substantial evidence. 158 Ark. 119; 126 Ark. 318; 111 Ark. 119; 118 Ark. 319; 102 Ark. 135; 150 Ark. 13; 127 Ark. 600; 65 Ark. 278. Conceding that there was a promise to pay by appellant, the promise was not legally enforceable because 'within the statute of frauds. While this statute was not pleaded, it is not necessary to do so. 19 Ark. 39; Id. 23; 111 Ark. 158; 129 Ark. 253. After the loading of the car and issuance of bill of lading title to the coal passed to the consignee named therein. 115 Ark. 221; 101 Ark. 215; 118 Ark. 117; 111 Ark. 161; 38 Ark. 111. Plaintiff would thereafter only have power to stop delivery in case of the insolvency of the consignee. Appellee however knew the condition of the consignee at the time shipment was made, and there was no change thereafter. 21 Pac. 886. Since plaintiff could not withhold delivery to the consignee, the alleeed promise of arynenant. even if made, was without consideration. 30 Ark. 50; 51 Ark. 151.

      Dave Partain, for appellee.
   Hart, J.

(after stating the facts). The principal ground relied upon by the defendants for a reversal of the judgment is that the promise of Moraz to pay for the coal, if made, was unenforceable under the statute of frauds.

In determining whether an oral promise is original or collateral, the intention of the parties at the time it was made must be regarded; and, in determining such intention, the words of the promise, the situation of the parties, and all of the circumstances attending the transaction should be taken into consideration. Millsaps v. Nixon, 102 Ark. 435, and Black Bros. Lumber Co. v. Varner, 164 Ark. 103.

The defendants base their right to a reversal of the judgment upon that part of the plaintiff’s testimony to the effect that Moraz told him that if he would let him have the oar of coal, he would see that he got paid for it.

The contention is that this promise is collateral under the statute of frauds. This testimony, however, is not controlling. On reexamination the plaintiff stated that Moraz had agreed to pay for the car of coal. Again he stated that Moraz had repeatedly agreed to pay for all the coal that the plaintiff sold the corporation which Moraz represented. He said that the second car of coal was sold to the Dunkin-O’ Brien Company for $142.50, and that was the price that Moraz was to pay for it.

Again the plaintiff stated that he would not have given Moraz permission to unload the second car of coal unless he had agreed to pay for 'all the coal he had sold to the corporation, and also to pay for that particular car.

The court found for the plaintiff in the sum of $142, which was the price, less fifty cents, of the second car of coal.

The testimony of the plaintiff, which we have just referred to, might have been considered by the circuit court trying the cause as explanatory of the first part of the testimony of the plaintiff, to the effect that Moraz told the plaintiff that, if he would let him have the second car of coal, he would see that he got paid for it. Therefore, when the testimony of the plaintiff is considered as a whole, the circuit court was legally justified in finding that Moraz had agreed to pay the plaintiff for the second ear of coal.

On the' question of the attachment but little need be said. The evidence shows that the defendants were nonresidents, and that the drilling equipment belonged to Moraz. The ground for the attachment was that the defendants were nonresidents of the State and were about to ship their property out of the State, not leaving sufficient property therein to pay their creditors.

No answer was ever filed by the defendants denying the existence of the ground for attachment as stated in the affidavit. The record shows that the attached property belonged to M-oraz.

It follows that Dunldn was not injured by the levying of the attachment, and the effect of the judgment of the circuit court was to sustain the attachment as to Moraz. This finding was warranted under the facts as they appear in the record.

It follows that the judgment must be affirmed.


author: Wood, J. McCulloch, C. J.

text:
    Campbell v. Smith.
    Opinion delivered February 9, 1925.
    1. Executors and administrators — right of administrator to recover rents. — An administrator is not entitled to recover rents on a building owned by his intestate where he neither alleges nor proves that the rents are needed to pay intestate’s debts.
    2. Set-off and counterclaim — evidence.—In a suit by an administrator to recover rents due to his intestate’s estate, where the evidence failed to show that the rents were needed to pay intestate’s debts, it was not error under the evidence to submit to the jury the issue whether plaintiff was not collecting the rents for the heirs under an agreement by the heirs that plaintiff’s store account with defendant should be deducted from the rent money.
    Appeal from Phillips Circuit Court; E. D. Robertson, Judge;
    affirmed.

      Moore, WalHer (& Moore, for appellant
    Appellee could not offset any claim he might have against appellant individually against the- claim due appellant as administrator. 7 Ark. 520; 24 R. C. L. 871; 110 N. Y. 605.

      W. G. Dinning, for appellee.
    Appellant is not entitled to maintain this suit. An administrator has no right to the possession of lands or rentals therefrom, except in case where they are needed for the purpose of paying debts probated against tht estate. 46 Ark. 373; 49 Ark. 87; 107 Ark. 402; 11 R. C. L., p. 155.
   Wood, J.

This is an action by the administrator of the estate of B. H. Boswell, to recover the sum of $630.47 alleged to be due the administrator by H. G. Smith for the rent of a certain store building in Phillips County, Arkansas. The answer denied that the plaintiff was acting as administrator, and denied that the defendant leased from the plaintiff, as administrator, the storeroom in controversy. The defendant admitted that he occupied a certain building from March 1,1920, to March 1, 1923, which building belonged to Boswell in his lifetime. The defendant denied liability to the plaintiff.

The testimony on behalf 'of the plaintiff was to the effect- that he was the administrator of the Boswell estate; that the defendant was indebted to him as administrator in the sum of $630.47; that the plaintiff, as such administrator, rented to the -defendant the storeroom in controversy, and that the defendant knew that, in so doing, he was acting in the capacity of administrator; that the defendant went into possession of the building under written contract for the first year at a monthly .rental of $20, and, at the expiration of the first year, defendant continued in possession of the building, without any written agueement, at the same rental-until July, 1920, when the rent was increased to $25 per month. The plaintiff allowed the defendant to take -credit for a grocery bill at the time he made settlement with him for the rent in 1920. Plaintiff denied that he ever bought any g’oods or merchandise from the defendant for the estate of Boswell, and denied that he ever authorized the defendant to charge said estate with any merchandise sold to the plaintiff. The wife of the defendant is one of the heir-s of Boswell.

The defendant testified that he settled with the plaintiff for the rent of the storeroom in controversy in the fall of 1920 by giving the plaintiff a check for $600, which was indorsed “J. S. Campbell, administrator;” that, at the time of the settlement, with the consent of the plaintiff, the defendant took credit for the amount the plaintiff owed him at the store. The defendant had paid all that he owed the plaintiff except $29. Defendant executed the lease in 1916 for one year at -the monthly rental of $20. It was a year or more after the contract was entered into that the defendant agreed to pay $25 per month rent.

The plaintiff presented prayers for instructions to the effect that the defendant -could not, under the law, charge the estate of Boswell with any account of money due from the plaintiff personally to the defendant; that, if the defendant rented the premises from the plaintiff as administrator, then the defendant could not claim as a -credit on the rent any amount due from the plaintiff to the defendant. The court overruled these prayers, and modified the same hy adding thereto the words, “unless plaintiff had previously agreed to the same,” and gave the instructions as modified, to which rulings of the court the plaintiff duly excepted. The court also gave the following instruction: “If you find from the evidence that the plaintiff agreed that his store account should be applied towards the payment of the rent, then you are instructed that the plaintiff is entitled to recover the difference between the items of credit and amount of rent according to -the contract.” The plaintiff duly excepted to this instruction. The jury returned a verdict in favor of the defendant, and the court entered a judgment in his favor, from which judgment plaintiff duly prosecutes this appeal.

It will be observed that there is no allegation in the complaint to the effect that, during the time of the alleged contract between the appellant and the appellee for the rent of the store building in controversy, there were outstanding debts against the estate of Boswell, and that it was necessary for the administrator to take possession of the store building and rent the same for the purpose of paying such debts. In the absence of allegation and proof to that effect, the appellant was not entitled to an instruction telling the jury as a matter of law that the appellee would not have the right to offset or pay the account in controversy by crediting the claim with the amount of appellant’s account or indebtedness with the appellee. There was testimony to the effect that the wife of the appellant was one of the heirs of Boswell and that the wife of the appellee was another, and that, by mutual agreement between the heirs and the appellant and appellee, the store account of the appellant with the appellee would be used as an offset against appellant’s claim for rent or use of the building which appellee was occupying. There was' testimony to warrant a finding that the appellant was in charge of the building by consent of the heirs, not for the purpose of paying any debts of the estate of Boswell, but that he was in possession representing the heirs, and that, having such possession, he rented the storehouse to the appellee, and had settled the account by deducting from the same the amount that appellant was due the appellee on store account.

If this was the specific agreement between the appellant and the appellee, and there was proof to that effect, then the court did not err in refusing appellant’s prayers for instructions as asked, nor in modifying the same and giving the same as modified. We find no error in the instructions of the court. They correctly submitted the issues which, the testimony tended to prove. Section 67 C. & M. Digest. See Stuart v. Smiley, 46 Ark. 373, and cases there cited; Chowning v. Stanfield, 49 Ark. 87; Jones v. Jones, 107 Ark. 402.

The judgment is correct, and it is therefore affirmed.

McCulloch, C. J.

(dissenting). The issue tendered in the pleadings was whether or not the defendant leased the property from plaintiff as administrator of the Boswell estate. The testimony was conflicting on that issue, and the plaintiff requested an instruction submitting it and telling the jury that, if defendant rented the premises from plaintiff as administrator, then the defendant could not claim credit against the rent for a personal account against plaintiff. This was a correct statement of the law, and it should have been given to the jury. Instead of giving the instruction, the court modified it and gave' another instruction to the effect that, if plaintiff had previously agreed to allow the credit, defendant was entitled to the credit. It seems to me to be elemental that one who incurs an obligation to pay money to an estate cannot claim credit for a personal debt due by the administrator. This court has so decided. Menifee v. Ball, 7 Ark. 520. Any distribution of the rent between the heirs of the decedent must be through the probate court on settlement of the account by the administrator.

If the defendant leased the premises from plaintiff in his representative capacity as administrator, he cannot as such tenant dispute the title or authority of his landlord for the purpose of claiming credit for the personal debt of the administrator.


author: Wood, J.

text:
    Shelton v. Landers.
    Opinion delivered February 9, 1925.
    1. Trover and conversion — sufficiency of complaint. — In an action for conversion of a county warrant, complaint held to state a cause of action.
    2. Trover and conversion — conversion of county warrant.— Though plaintiff, as assignee of a claim against a county, might have had the county clerk issue a warrant directly to him by complying with Crawford & Moses’ Dig., §§ 1999-2002, this fact did not preclude him from proceeding against defendant for conversion of the warrant if defendant, without authority, procured a warrant to be issued to himself.
    3. Trover and conversion — negligence of clerk no defense.' — - In an action for conversion of a county warrant belonging to plaintiff which the county clerk negligently issued to defendant, the clerk’s negligence is no defense to defendant, nor does it free him from liability for procuring the clerk to issue the warrant to him without authority.
    4. Pleading — sufficiency of complaint. — In an action for conversion of a county warrant, an allegation that defendant, without any right or authority, procured the clerk to issue and deliver said warrant to him was sufficient, in the absence of a motion to make the complaint more specifie, to let in proof as to the method used by defendant to procure the clerk to issue the warrant.
    5. Pleading — sufficiency of complaint. — In an action for conversion of a county warrant issued by the clerk to defendant, an allegation in the complaint that plaintiff’s assignor had assigned to plaintiff the claim on which the warrant was issued was sufficient, in the absence of a motion to make the allegation more specific, to let in proof as to the manner of transfer or assignment.
    6. Counties — transfer of claim against. — The transfer of a claim against a county is not within Crawford & Moses’ Dig., § 6303, providing that a sale of a judgment or any part thereof must be by written transfer.
    7. Judgment — effect of default. — Judgment by default admits to ■ be true all material allegations properly set forth in the complaint, and is tantamount to an admission that plaintiff is entitled to judgment as prayed by him.
    8. Appeal and error — harmless error. — In an action for conversion of a county warrant, error in failing to call a jury to assess plaintiff’s damages was not prejudicial where the judgment contained recitals which showed that if a jury had been called the only verdict which could have been rendered would have been for the amount found due by the court.
    9, Appeal and error — presumption.—Where a judgment recited that the defendant appropriated to his own use a county warrant which was the property of plaintiff and of its face value, it will be presumed that the court had the warrant before it and that the warrant was worth its face value.
    10. Evidence — presumption.—A county warrant is prima facie of the value stated on its face.
    Appeal from Craighead Circuit Court, Jonesboro District; G. E. Keck, Judge;
    affirmed.

      Gautney S Dudley, for appellant.
    There was no compliance by appellee with the law governing the issuance and delivery of the scrip. See §§• 1999, 2002, and 6303, C. & M. Digest. The complaint failed to state a cause of action and should be set aside on appeal. 66 Ark. 263; 94 Ark. 572; 157 Ark. 385. A jury should have been called, there being no waiver of the right to a trial by jury. C. '& M. Dig. §' 1266. See also § 6238 Digest. This was not an action founded on contract, but one sounding in trover or conversion. 4 Ark. 440; 16 Ark. 199; 25 Ark. 565; 109 Ark. 534; 20 L. R. A. (N. S.), and note.

      Lamb <$> Frierson, for appellee.
    The warrant in question was not a judgment but personal property, but treating it as a judgment, it would have been assignable. 113 Ark. 486; 102 Ala. 635, 15 R. C. L., p. 775, § 27; 2 Freeman on Judgments, § 422. A judgment assigned otherwise than in accordance with § 6303, C. M. Digest, is at most but an irregularity and not ground for reversal. The provisions of this section are merely cumulative. 98 Ark. 529 ; 74 Ark. 551. By failing to appear after summons, appellant waived his right to trial by jury. C. & M. Digest, § 1308; 44 Ark. 202 ; 113 Ark. 261. Since the adoption of our civil code the cases cited by appellant in 4 Ark. 440, 16 Ark. 199 and 25 Ark. 563 are no longer authoritative, being destroyed by § 1308 C. & M. Dig. and 44 Ark. 202. Appellant makes no complaint of the general form of the judgment; hence the only question for the court is whether or not the complaint states a cause of action. A judgment based upon a good complaint, and with personal service, need contain no further recital or finding than that the defendant is indebted to the plaintiff, and that the latter recover the amount so found. 33 C. J. p. 1194-5, §§ 125-128; 20 Tex. 2; 99 Ark. 433. A county warrant is prima facie worth its face. 44 Ark. 437; 103 Ark. 468; 34 Ark. 684; 31 Ark. 5'52. A value once proved is presumed to continue until the contrary appears. 248 Fed. 636; 45 N. E-. 276; 40 Mich. 545; 66 Mo. App. 678 ; 83 Atl. 776; 85 Ore. 345.
   Wood, J.

This is an action by the appellee against the appellant. The appellee alleged that, prior to December 20, 1920, Poinsett County was indebted to Hooten, or Hooten & Company, in the sum of $1,708; that J. C. Hooten, or Hooten & Company, assigned the account to the appellee, and that the appellee was the only person having the right to receive payment from the county; that the appellant, notwithstanding this fact, procured a warrant to be issued by the clerk of Poinsett County to him, which warrant he converted to his own use, and thereby damaged the appellee in the sum of $1,708, which the appellee had demanded and which the appellant had refused to pay, and for which amount appellee prayed judgment.

The appellant was duly served with summons, and, having failed to answer, judgment was rendered by default against him on September 6, 1923. The judgment, after reciting that the appellant had been duly summoned, called, and made default, continues as follows: “The court finds from the evidence that the defendant has been personally served with summons at the place and at and for the time in form and manner required by law; that in December, 1920, the defendant received and appropriated to his own use a county warrant of Poinsett County, which warrant was, at the time of such receipt and appropriation, the property of plaintiff ; that the same was issued in the amount and of the value of $1,708, and that defendant is indebted to plaintiff in said sum, together with interest thereon at six per cent. from January 1, 1921, amounting in the aggregate to $1,986.60. It is therefore by the court considered, ordered and adjudged that plaintiff Ed Landers have and recover of and from the defendant W. D. Shelton said sum of $1,986.60, together with all costs herein, for which execution may issue.” Prom the above judgment is this appeal.

The appellant contends, first, that the complaint fails to state a cause of action within the jurisdiction of the court. The complaint, though somewhat vague and indefinite, contains sufficient allegations to state a cause of action in favor of the appellee against the appellant for conversion. It alleges that the appellee was the owner of a warrant by assignment from Hooten, or Hooten & Company, which had been previously allowed by the county court, and that the appellant, “without any right or authority, procured the clerk of Poinsett County to issue and deliver the warrant to him, and that the appellant used and converted the same to his own use, to the damage of appellee in the sum of $1,708.” The appellant contends that appellee’s remedy, as the assignee of the claim of Hooten, or Hooten & Company, was to apply to the clerk of Poinsett County for the issuance of the warrant to him under the procedure set forth in §§ 1999 to 2002, inclusive, of Crawford & Moses ’ Digest. These sections provide for the issuance by the clerk of county warrants to those who have had claims allowed against the county upon their request and receipt for same. But the fact that the appellee, as the assignee of the claim against the county, might have had the right, under these provisions of the law, to have had the county clerk of Poinsett County issue the warrant to him direct by complying with the above sections, does not interfere with the appellee’s right to proceed against the appellant, if the appellant, without authority from the appellee, procured the clerk of Poinsett County to issue the warrant to him. If the appellant procured the clerk to issue the warrant to him when he was not entitled to the .same, then appellant was guilty of a wrong for which he was liable to the appellee, and such conduct on the part of the appellant, under the -circumstances, does not make the appellant any the less liable, even though the clerk of Poinsett County, in issuing the warrant to the appellant, may not have complied with the law. The clerk’s failure to do his duty, as stated by counsel for appellee, did not destroy appellee’s title to the warrant nor vest title to the same in appellant. The fact, if it be a fact, that the county clerk of Poinsett County negligently delivered the warrant to appellant, did not exonerate appellant, nor free him from liability in procuring the clerk to issue the warrant to him without authority. The complaint states -a -cause of action, and, if ¡appellant desired that it be made more definite and certain, he was served with process and had an opportunity to appear and move the court to that end. The allegation that “the defendant, without any right or authority, procured the clerk of Poinsett County to issue and deliver said warrant to him” was sufficient, in the absence of a motion to make more specific, to let in proof as to the method used by the appellant to procure the -clerk to issue the warrant to him. Likewise, the allegation that Hooten, or Hooten & Company, had assigned the claim and warrant to the appellee was -sufficient, in the absence -of motion to make more specific, to let in proof as to the manner of the transfer or assignment.

Section 6303 of Crawford & Moses’ Digest, providing that the sale of a judgment, or any part thereof, of any court of record must be by a written transfer, etc., we do not consider has any application to the allegations of the complaint. A claim against the county which has been allowed and a warrant issued thereon as evidence of such allowance is not within the purview of § 6303-, supra. Such a warrant is personal property like a note, check, draft, or other chose. A judgment by default admits to be true all material allegations properly set forth in the declaration, and is tantamount to ’ an admission that plaintiff is entitled to judgment as prayed by him. 15 R. C. L. 667, §§ 117, 118; Melton v. St. L. I. M. & S. Ry. Co., 99 Ark. 433.

2. The appellant next contends that a jury should have been called to assess the damages, and that, since this was not done, the judgment is void. We find it unnecessary to decide, and do not decide, this question for the reason that if it be conceded that it was the duty of the court to-call a jury to -assess the damages and that the court erred in not doing so, nevertheless, such error, under the recitals of the judgment could not have prejudiced the appellant. The judgment recites that “the court finds from the evidence that the defendant received and appropriated to his own use a county warrant, which warrant was, at the time of such receipt -and appropriation, the property of plaintiff; that the same was issued in the amount and of the value of $1,708,” etc. These recitals were sufficient to show that the findings and judgment of the court were predicated, not alone upon the pleadings in the cause, but upon the evidence. The recitals show that the merits of the cause were finally determined, and the judgment is therefore sufficient. Melton v. St. L. I. M. & S. Ry. Co. supra. See also Cook v. Hancock, 20 Texas 2, 33 C. J., p. 1194, §§ 125-128. The presumption from these recitals is that the judgment of the court was based on sufficient evidence to sustain the same. In the absence of a showing to the contrary, it will be presumed that the court had the warrant before it, and that such warrant was worth its face value. Moreover, the warrant itself was prima facie of the value stated on its face. See §§ 2028, 2029, C. & M. Digest; Goyne v. Ashley County, 31 Ark. 552; Union County v. Smith, 34 Ark. 684; Barton v. Swepson, 44 Ark. 437. See also Watkins v. Stough, 103 Ark. 468.

The recitals of the judgment shows that if a jury had been called, the only verdict it could have rendered under the evidence would have been to assess the damages at the amount set forth in the recitals of the court’s judgment.

The judgment is in all things correct, and it is affirmed.


text:
    Bloyd v. Williams-Echols Dry Goods Company.
    Opinion delivered February 16, 1925.
    Bankruptcy — discharge of- firm — effect as to member. — Discharge of a partnership in a bankruptcy proceeding will not operate to discharge a member of such firm from liability for ithe firm debts where he was not adjudicated a bankrupt and discharged as an individual.
    Appeal from Washington Chancery Court; Ben F. McMahan, Chancellor;
    affirmed.

      John Mayes and W. N. Ivie, for appellant.
    The case of Young v. Stevenson, 73 Ark. 480, which is on “all fours” with the present case as appears by the agreed statement, has settled the question here involved in favor of appellant. The case of Curlee Clothing Co. v. Hamm, 160 Ark. 483, we think, was not intended to change the rule of law established by the first-mentioned case, and it should be distinguished or even overruled, in so far as it is in conflict with the Yowig case, because the Young case is correct, and has become a rule of property by its long standing. 139 Ark. 130; 152 Ark. 276; 228 IT. S. 695; 247 Fed. 253; 265 111. 285, LI R. A. (N. S.) 1915-F, 688 and footnote.

      DaAly '<& Woods and C. D. Atkinson, for appellee.
    The rule of law controlling in this case no longer has its basis on Yowig v. Stevenson, 73 Ark. 480, if it ever had, but on Moore Dry Goods Co. v. Ford, 146. Ark. 227, and 'Curlee Clothing Co. v. Hamm, 160 Ark. 483, which later cases are in conformity with the weight of the decisions. 19 A. B. R. 577; 247 Fed. 253; 57 L. ed. (IT. S.) 1029; 249 Fed. 134; 215 Fed. 845; 247 Fed. 253; 15 A. B. R. 542; 17 A. B. R. 331; 3 A. B. R. 1; 68 L ed (U S.) 364.
   Wood, J.

The appellant and one C. A. Wilson were the only members of a firm or partnership doing a mercantile business at Addielee, Oklahoma, under the firm name and style of Valley Trading Company. The appellee instituted this action against the appellant and Wilson, alleging that they Were indebted to it in the sum of $1,418.70 on an open account for merchandise, and that appellant and Wilson were'indebted to appellee in.other sums which were duly asigned to the appellee, amounting in the aggregate to $3,029.07; that appellant had made fraudulent conveyances of lands in Washington County to defraud appellee, and that Wilson, the other partner, had been adjudicated a bankrupt on or about the first of April, 1922, and that all of his individual assets had been administered or were in the process of being administered in bankruptcy. Appellee prayed judgment against the appellant and C. A. Wilson in the sum of $3,029.07, and asked that the conveyances of the. lands be set aside for fraud, and that appellee have a lien upon them for its debt.

It was admitted in the answer that Wilson had been adjudicated a bankrupt, and that all of his individual assets had been administered, or were in the process of being administered, in bankruptcy, and it was admitted that the Valley Trading Company had been adjudicated a bankrupt, and that a distribution had been made of all of its assets, as alleged in the complaint, and that the Yalley Trading Company had been discharged from all its debts in such bankruptcy proceedings, and it was alleged that the appellee and each of its assignors, as creditors, were duly notified of the bankruptcy proceedings, and had filed their claims in bankruptcy, which had been duly allowed, and which had received the dividend's allowed to the creditors of the bankrupt estate, and that each of said claims upon which this action was founded had been fully discharged in such bankruptcy proceedings. The appellee, by permission of the court, moved to strike from the answer of the appellant the paragraph which set up that the discharge in bankruptcy of the Yalley Trading Company was a complete defense to the action.

The cause was heard upon the pleadings and the agreed statement of facts relating to the issue as to whether the discharge in bankruptcy of the partnership was a defense to the action against the appellant. The court found that the discharge in bankruptcy of the partnership, Yalley Trading Company, was not a defense to the action against appellant Bloyd, and entered a decree in favor of the appellee against the appellant Bloyd for the amount claimed by the appellee, from which decree is this appeal.

The only question presented by this appeal, as set forth in the pleadings and proof in the agreed statement of facts, is whether or not the discharge in bankruptcy of a partnership operates as a discharge of the individual members of the partnership who were not, as individuals, adjudicated and discharged as bankrupts from individual liability for the debts of the partnership. The appellant contends that the adjudication in bankruptcy of the partnership and a discharge of the partnership from all debts likewise discharged the appellant, as a member of the firm, from his individual liability for the partnership debts. To support this contention, he relies upon the case of Young v. Stevenson, 73 Ark. 480. The facts in that case, as stated by the court, were as follows:

• “This is an appeal from a judgment quashing a writ of execution sued out by appellant against appellee on a judgment rendered by a justice of the peace, and after-wards filed in the circuit court. The judgment was against 'appellee Stevenson and Munder, upon notes executed to appellant, and signed individually by each, and upon an account for money paid by appellant for appellee and Munder. Subsequently to the rendition of this judgment, appellee and Munder as partners, and Munder individually, filed their petition in bankruptcy in the District Oourt of the United States for the Western District of Arkansas, and scheduled the Young judgment among their partnership debts; and notice was given to appellant, according to the practice under the bankrupt act of Congress, but he did not appear and prove his claim against the estate of the bankrupts. Appellee joined in the petition in bankruptcy as a member of the firm, praying for a discharge from the partnership debts, but did not schedule any separate individual debts or assets, nor ask for a discharge from his individual debts. And an order was entered in due form discharging the firm of Munder & 'Stevenson, composed of Millie Munder and W. H. Stevenson, ‘from all debts and claims which are made provable by the acts of Congress against its estate, and existing oix the date of the filing of the petition in bankruptcy.’ The execution was issued after the discharge in bankruptcy, and appellee filed his motion to quash on the grouxxd that the judgment was a partnership debt of the firm of Munder & Stevenson.”

Upon the above facts, the court held that “the effect of the discharge in bankruptcy was to release the members of the firm, individually and as partners, from all the provable debts of the firm, save those specially excepted by the terms of the statute, such as judgments in actions for fraud or false pretenses, etc. The discharge is the judgment of a court of competent jurisdiction, and cannot be collaterally attacked.”

It will be observed that tlie facts of the above case of Young v. Stevenson readily differentiate it from the case at bar. In that case the appellee, one of the partners, joined in the petition in bankruptcy as a member of the firm, praying for a discharge individually from the partnership debts. This petition of the individual partner to be discharged in bankruptcy from liability as an individual for the partnership debts gave the bankruptcy court jurisdiction of the person and the subject-matter of whether or not the individual partner was a bankrupt and the administration of his individual assets as such. The determination of the court that no individual assets had been included in the schedules was held conclusive of that fact. That, in the above case, adjudicated the question of the individual liability of partners for partnership debts, and determined that the discharge in bankruptcy under the pleadings was to release the members of the firm individually from the partnership debts. But to so hold in the case at bar would be beyond the scope of the issue. There is nothing in all this record to indicate that the bankruptcy court was asked to adjudicate that the partners, as individuals, were bankrupt and to discharge them from individual liability for the partnership debts.

But, if the appellants be correct in their contention that there is no distinction in principle between the facts of this record and the facts of the record in Young v. Stevenson, supra, then the doctrine of that case is unsound and is overruled by the later cases of Wm. R. Moore Dry Goods Co. v. Ford, 146 Ark. 227, and Curlee Clothing Co. v. Hamm, 160 Ark. 483.

In the case of Wm. R. Moore Dry Goods Co. v. Ford, supra, we said: “The complaint contains the affirmative allegation that individual partners composing the firm of Ford & Wheeler did not obtain a discharge in bankruptcy. There appears to be a conflict in the authorities as to the effect of the discharge of a partnership on the liability of the individual partners. * * * ‘It has been uniformaly held that, in a proceeding by a partnership, in which the individuals are not adjudicated bankrupt, they are not entitled to a discharge. ’ ’ ’ And in the case of Curlee Clothing Co. v. Hamm, supra, this doctrine is reiterated and followed. To sustain the doctrine announced in the later cases, the following authorities are cited in the opinions: Armstrong v. Norris, 247 Fed. 253; Horner v. Hanner, 249 Fed. 134; Francis v. McNeal, 228 U. S. 695.

It would be supererogation, pure and simple, to enter here upon a review' of these cases. In view of the diversity of opinion in the lower Federal courts on the issue as to whether the bankruptcy of a partnership involves an adjudication likewise of the bankruptcy of the individual partners, we shall treat the question as definitely settled in accordance with the doctrine of our own cases, as announced in the cases of Wm. R. Moore Dry Goods Co. v. Ford and Curlee Clothing co. v. Hamm, supra, until there shall have been a pronouncement to the contrary by the Supreme Court of the United States, the ultimate authority on the subject. Thus far it seems there has been no such decision of the Supreme Court of the United States. See Liberty National Bank v. Bear, 265 U. S. 365, 68 Law. edition, 564.

The decree is therefore correct, and it is affirmed.