text:
    Great Southern Fraternal Union v. Stroud.
    Opinion delivered October 12, 1925.
    1. Appeal and error — bringing up agreed) statement op pacts._• The .mere filing of an agreed statement of facts does not make it a part of the record Where it is not brought up in a bill of exceptions nor incorporated in the judgment entry.
    2 Appeal and error — presumption op regularity. — Where the trial court found that the defendant was duly served with summons, and that the cause was submitted to the court upon, the complaint of the plaintiff and upon oral evidence, it will be presumed on 'appeal, the evidence not being brought up, that a judgment by default in plaintiffs’ favor was based on evidence not included in the record, though the sheriff’s return upon the summons fails to show proper service.
    Appeal from Garland Circuit Court; Earl Witt, Judge;
    affirmed.
    STATEMENT BY THE COURT.
    Agnes Stroud 'brought this suit in the circuit court against the Great Southern Fraternal Union to recover $300 alleged to be due her upon a death benefit certificate issued ini her flavor upon the life of her husband.
    Judgment by default was rendered in her favor against the defendant for the amount sued for, and the judgment recites that, “it appearing to the court that the defendant was duly served with process of summons for the time, and in the manner prescribed by law, this cause is submitted to the court for its consideration and judgment upon the verified complaint of plaintiff and upon the oral evidence taken in open court,” etc. Two days after the default judgment was rendered, the defendant filed a motion to set aside the judgment and to quash the service of summons upon it.
    The plaintiff filed -a response to the motion, -in which she denied that the judgment was void, and that an improper mode of service was secured upon the defendant.
    The circuit court denied the defendant’s motion to set aside the default judgment and to quash the service of summons upon it. The case is here on appeal.

      J. R. Booleer and Thomas J. Price, for appellant.

      A. B. Belding, for appellee.
   Hart, J.,

(after stating the facts.) Counsel for the defendant insist that the judgment should be reversed because the court erred in refusing to sustain its motion to set aside the judgment and to quash the service of summons upon it. This motion was made at the same term of the court at which the judgment was rendered, and, to sustain the assignment of error in this respect, counsel for the defendant rely upon an agreed statement of facts, which appears in the transcript.

The mere filing of the agreed statement of facts does not make it part of the record. There is no bill of exceptions in the record, and the purported agreed statement of facts is not incorporated in the judgment itself. Hence we cannot know whether the circuit court erred -or not in refusing to set aside the judgment and to quash the service of summons upon the defendant. Therefore, we must assume that the judgment of the court in this respect is correct. Satterfield v. Loupe, 160 Ark. 226.

Again it is insisted that the judgment roll shows that the judgment by default was erroneous, and that for this reason the judgment should be reversed.

In this assignment of error reliance is placed by counsel for the defendant upon the recital in the service of summons and the return of the -officer on it. But the finding -of the court is that the defendant was duly served with summons for the time and the manner prescribed by law, and that the cause was submitted to the court upon the complaint of the plaintiff and upon oral evidence. This recital is sufficient to show that the court had jurisdiction. ¥e cannot know that the court based its finding that the defendant was duly served with summons for the time and the manner prescribed by law upon the recital in the summons itself, and the return; of the officer. It may be that the court heard other evidence which showed that there was -a mistake in the recital of the summons, and in the return -of the officer, and based its finding on this evidence Which is not included in; the record.

The finding of the court that the -defendant was duly served with process of summons fo-r the time and in the manner prescribed by law .is a matter of record, and is therefore record evidence -of the facts recited. The mere fact that the defendant made default did not -deprive the court of the power of ascertaining' and finding the facts necessary or pertinfent to the judgment rendered. The usual presumption in favor of judgments must obtain.

Therefore, we must regard this finding as evidence of the fact it recites, and as sufficient to sustain the judgment. Roth Tobacco Co. v. Layton Department Store, 163 Ark. 221.

It follows that the judgment must he affirmed.


source: Caselaw Access Project

author: 'Smith, J.

license: Public Domain

text:
    May v. Ewan.
    Opinion delivered October 12, 1925.
    1. Landlord and tenant — payment of rent out of cotton raised on land. — 'Under a contract of lease which ¡provided that the lessee should pay 40 pounds of lint cotton per acre as rent, “to be from the first picking from said lands,” the rent was payable in any event, and not upon condition that the stipulated amount of cotton should be raised on the land.
    2. Partnership — authority of partner — jury question. — Where a partnership between A an B was formed for the purpose of culti- ■ vating A’s lands, and B leased and cultivated other lands of a third person, an instruction that if B engaged in leasing and renting such other lands with A’s knowledge, the lessor would be justified in assuming that a lease executed by B in the firm name was authorized by A, was erroneous, as the question whether B acted within the apparent scope of his authority in leasing the additional lands w¡as a question for the jury.
    3. Partnership — scope of partner’s authority. — In order for an act of a partner to bind the partnership, it must be shown that the act is authorized by the partnership agreement, or that it is usual in carrying on the firm’s business.
    Appeal from.P'Mllips Circuit Court; E. D. Robertson, Judge;
    reversed in part.

      W. G. Dinning, Sheffield <& Coates and P. R. Andrews, for appellant.

      Lee & Moore and Moore, Walker & Moore, for appellee.
   'Smith, J.

Appellee, who was the plaintiff below, brought this suit to recover a sum alleged to be due him as rent on a tract of land in Monroe County for the year 1923. The suit was brought against "W. W. May and Van G-. Patrick as partners and against H. C. Pope, and judgment was recovered against all three defendants, and they have all appealed.

May owned a large tract of land in Phillips County, and in 1908 he formed'a copartnership with Patrick, who was his nephew, to clear and cultivate these lands. In connection with these operations, a commissary was operated from which the tenants on the land were furnished with necessary supplies. Patrick furnished certain tenants on other lands in which May was not interested. An agreement to dissolve this copartnership was entered into between May and Patrick' in the fall of 1919, but the agreement does not appear to have been consummated until about February 20, 1920, at which time May sold1his lands and his entire interest in the partnership' to another partnership which was formed for the purpose of buying May out. As May expressed it, the sale was a “walk-out” proposition.

The new partnership to which May sold out was composed of Patrick, T. J. Mott and J. D. May, and that partnership operated under the firm name- of Mott, Patrick & M-ay. In some manner Mott and J. D. May retired from this new partnership- and Patrick continued its business. After appellant May had sold -out to this new partnership, he appears to have had nothing further to do with the operations of the new partnership.

On the 13th day of August, 1919, appellee entered into a written contract whereby he- leased his cleared lands for a period of five years. This contract was signed by appellee, as landlord, and by H. 0. Pope and by May & Patrick by Van G. Patrick, as tenants. This contract was acknowledged August 13, 1922, by Patrick before ,a notary public, and in the certificate of acknowledgment it was recited that he had executed the contract as one of the partners in the firm of May & Patrick, and that he had authority from said partnership so to- do. The contract provided that the land should be surveyed, and that this survey should be conclusive as to the acreage. The survey was made, and according to it there were 900 acres of the cleared land. The lease contract was amended on January 20, 1920, to recite that fact, and it was again signed by the same parties.

The lease contract contained the following agreement in regard to rent: “The parties of the second part agree to pay as annual rental for the said cleared lands forty (40) pounds of lint cotton per acre, said lint cotton to be picked, ginned, baled and delivered to the said party of the first part by the said parties of the second part at the railroad station at Postelle, Arkansas, and to be from the first picking of cotton from said lands, same to be delivered as soon as same is picked, ginned and baled.”

The rent was paid appellee according to the terms of the contract for the years 1920,1921 and 1922, but was not fully paid for the year 1923, and this suit was brought to recover the balance due.

Separate answers were filed by Patrick and Pope and by May. Patrick & Pope defended upon the ground that they had delivered to appellee 'all of the cotton grown upon the place except five bales which were erroneously sold, and as to the value thereof they offered to confess judgment. They had tendered to appellee a quantity of hay raised on the land in 1923, and they alleged that this hay, together with the cotton delivered and the five bales for the value of which they offered to confess judgment, constituted the entire crop grown on the land, and they insist that they are not liable further. Appellee declined to accept the hay on the ground that the rent was payable in cotton, and that, if cotton was not delivered in payment of rent, he was entitled to the value of the cotton which the contract required to be delivered.

Appellants Patrick and Pope insist that, inasmuch as the contract provided that the rent should be paid “from the first picking of cotton from said lands, same to be delivered as .soon as same is picked and ginned and baled,” they cannot be held liable for the value of any cotton not grown, and they asked instructions — which the court refused to give — so declaring the law.

These instructions were properly refused. It is true the contract referred to cotton grown on the land, and it is also true that enough cotton was not grown to pay the rent. But we think it was clearly contemplated by the parties, that enough cotton would be grown to pay the rent, for the contract provides that the rent should be paid “from the first picking of cotton.” .The contract contained no condition that the rent should be payable provided enough cotton was grown to do so, and we think the fair interpretation of the contract is that forty pounds of lint cotton should be paid for each acre of the land, and was to be paid from the cotton first picked, but was payable in any event.

No other error is assigned on the appeal of Patrick and Pope, and the judgment against them is. therefore affirmed.

The appeal of May presents more difficult questions. As we have said, the testimony shows — and we think beyond question — that the partnership of May & Patrick was dissolved not later than February, 1920, and Mav had nothing to do with the cultivation of appellees ’ land and derived no profit or advantage therefrom at any time, and May was not advised of this contract until the fall of 1922 or the spring of 1923. May concedes, however, that, after being so advised, he did not inform appellee that he was not a partner of Patrick and was not interested in the lease, and the court submitted to th« jury the question of ratification under instructions which are not questioned except that it is insisted that there was no testimony in the case which warranted the submission of that issue. We think, however, that it appears from the facts already mentioned and other facts which will be hereafter recited that the testimony was sufficient to warrant the submission of this question to the jury.

Giving the testimony which tends to support the verdict its highest probative value, it may be further summarized as follows. The profits of the commissary were to be equally divided between May and Patrick, and a volume of business exceeding twenty thousand dollars per year was done in the commissary. In 1914 May found the partnership was not getting on satisfactorily, and he took 'charge of it, but in 1916 turned it hack to Patrick to. be operated under the original partnership agreement. Patrick rented a farm known as the Nelson place and certain other small farms during this time, and took these contracts in the name of the firm. These contracts were from year to year, but it appears that when May was advised of these contracts he repudiated them and reproved Patrick for making them and declined to have anything to do with them or to make any settlement regarding them, and Patrick personally settled with his respective landlords. May admitted that he made no inquiry about the operations of Patrick, and when he learned in the fall of 1922 or the spring of 1923 that Patrick had executed a 'contract in his name as a partner of Patrick he did not advise appellee that this had been done without authority, and the 1923 crop was thereafter planted and grown. May resided in Mississippi, and appellee in Monroe County, Arkansas, and they never had any communication of any kind and had never met until the trial of the case in the court below.

As may be readily surmised, Patrick became one of the most important witnesses in the case. Tie testified that May had nothing to do with the contract, and was not advised of it until after he (Patrick) had operated under it for several years. He testified that he considered the contract a splendid one for himself and Pope when it was made, and that they rendered no account to May of their profits and operations under it for the years 1920, 1921 and 1922.

Over May’s objection the court gave an instruction numbered 3 reading as follows: “You are instructed that, though you may believe from the evidence that the partnership of May & Patrick was formed solely for the purpose of developing a large body of land belonging to the said W. W. May, if you find from a preponderance of the evidence that, after the forming of said partnership, it engaged in the business of general merchandising, of doing a furnishing .business, and. engaged in the leasing and renting, of lands, with the knowledge of the said W. W. May, and with the knowledge of the plaintiff in this case, .then the plaintiff would be justifiedin assuming that the, lease executed in this case, signed May & Patrick, 'by Van Gr. Patrick, was so executed with- the authority of the said W. W. May, and under -such circumstances the said W. W. May would be bound by the said lease.”

A general objection was made to this instruction, and the specific objection was made that it was a charge on the weight and the sufficiency of the testimony, and this objection appears to be well taken.

It will be observed that this instruction deals with the question of primary liability, and not with that of ratification, and tells the jury that, if the facts recited are true, appellee was warranted in assuming that Patrick had the authority to make the contract and to find for appellee, although the finding was also made that Patrick had no -such authority.

The circumstances enumerated were proper matters to be considered by the jury, - but the weight to be attached to them and the inferences to be drawn from them were questions for -the jury, and not for the court.

■ ■ ¡Without -setting out the testimony in further detail, we think it very clearly appears that the execution of the lease by Patrick in the name of May &■ Patrick was beyond the scope of the business of the partnership, and the questions (a) whether that act was within the apparent scope of Ms authority as a partner, and (b)-whether there was a ratification of Patrick’s unauthorized act, were properly questions for the jury.

It is familiar law that the liability of one partner for the acts of his copartner is founded on -the principles of agency, and that the power of one partner to act as agent for the principal and to bind it by his acts as such is limited to transactions within the scope'of the partnership business, and that one partner is not bound by the unauthorized acts of a copartner in a matter 'not within the apparent scope of the business of the partnership. Barnett v. McClain, 153 Ark. 325. Each partner acts as principal for himself and as agent for his copartners, and each partner is authorized to transact the whole business for the firm, and when he sa acts all are ■bound, but, like other agents, he binds his principal only when he acts within the scope or the apparent scope of his authority as such.

At § 95 of the chapter on Partnership in 20 R. C. L., page 884, it is said: “Strictly speaking, the power of a partner to act as agent is limited to transactions within the scope of the partnership business, and one partner is not bound by the unauthorized acts of a copartner in a¿matter not within the apparent scope of the business of the partnership. When a partnership is limited to a particular trade or business, one partner cannot bind his copartner by any contract not relating to such trade or business, or by any contract made after such business is concluded. Similarly, if the purposes of a partnership are limited and special, third persons cannot obtain credit on the faith of the firm in relation to a matter foreign to its objects; though, if the objects of the association are general, the power to bind may be equally general. ’

In § 96 of the same chapter, page 885, it was further said: “In order to determine the apparent scope of the authority of a partner, recourse may frequently be had to past transactions indicating a custom or course of dealing peculiar to the firm in question or to the general custom of parties and firms similarly situated and circumstanced. And the rule has been laid down that, in order for an act of a partner to be binding on the partnership, it must be shown affirmatively that such acts are authorized by the partnership agreement, or that they are usual in carrying on the land of business carried on by the firm. The authority for each transaction may be implied from the nature of the business according to the usual and ordinary course in which it is carried on by those engaged in it in the locality which is its seat, or as reasonably necessary or fit for its successful prosecution, and third persons may be presumed to have knowledge of the limited character of a business from circumstances connected with the business of the firm.”

It was the contention of May that the sole business of the partnership which had at one time existed between himself and Patrick was to clear and cultivate the lands owned by May, and that Patrick’s authority was limited to such matters as were incident thereto, but the instruction set out above tells the jury that, even though they found this to be true, May would be bound by Patrick’s acts if they found the enumerated circumstances also to be true.' By so doing the court took from the jury the decision of the question of fact whether the acts of Patrick which wlere beyond the scope ¡of his actual authority were within the apparent scope of his authority. This was a question of fact for the jury, and for the error in giving instruction numbered 3 the judgment against May must be reversed, and it is so ordered.


author: Smith, J.

text:
    Fort Smith Light & Traction Company v. Ward.
    Opinion delivered October 12, 1925.
    Street railroads — refusal of permission to remove tracks — evidence. — In a proceeding by a street railway company to remove its tracks from a street as being unremunerative evidence held sufficient to warrant a refusal of permission.
    Appeal from Pulaski Circuit Court, Second Division; Richard M. Mann, Judge;
    affirmed.

      Hill & Fitghugh, for appellant.

      G. L. Grant, for appellee.
   Smith, J.

The Fort Smith Light & Traction Company filed a petition before the Railroad Commission: of ■this State, alleging, in substance, that it was operating a street oar system in the cities of Fort Smith and Man Burén and between said cities and outside the limits of each city. That, owing to the increased use of automobiles, the street car service as a whole .had become unprofitable, and that a line known as the Van Burén local was especially unprofitable ¡and was operated at a constant loss, and it was prayed that the Commission grant it permission to remove a portion of this track. The part which the company desired to abandon extended from ;the city limits of the city of Van Burén to the plant of 'the Falcon Zinc & Smelting Company, a distance, of 1.08 miles..

' ' Upon-the filing of this petition 1,259' citizens and residents of Van Burén filed a remonstrance to-the granting of the prayer of this petition and made themselves parties to this proceeding, and it -was alleged by them that the line ¡sought to be abandoned was of vital need to the people of -the city of Van Burén and of-the adjoining country.' : :

At the-bearing before the Railroad Commission figures Were- submitted toy the auditor of the fraction company showing that the revenue -of the company was $244,-986.66, and the operating expenses were $205,478.78, leav-' ■ing a balance of $39,507.88. The valuation- of the company’s property was then shown, and with this basis of calculation it was made to appear that the company was earning less than two per cent, on the whole investment.

A request was made that the company detail the items included in the operating expenses, but this request was not complied with.

In the matter of the earning power-of the company’s investment, the same showing-was made hére as was made in the case -of Ft. Smith Light & Traction Co. v. Bourland, 160 Ark. 1. In -fact, the appellant -here was the appellant there. In the former appeal the question involved was the right to abandon a portion of the company’s track on the Fort Smith side of the river, while the present case involves, -the right to abandon certain tracks on the Van Burén side of the river.

The company had caused a record to be made and kept showing the operating cost per mile of its different tracks, and from these figures it appears that-the portion of the track which is sought to he abandoned.was operated at an actual loss. In addition, the company offered testimony tending to show that the public convenience would not be served by the continued operation of the track in question; that it was proposed by the State Highway Department to improve a portion of the street over which the track runs, and that, if this street were improved and made a part of the State highway system, the track should be abandoned. Testimony opposing this view was offered, and the Railroad Commission declined to -grant the permission requested.

An appeal was prosecuted to the circuit court, where the same finding was made, and by this appeal it is sought to reverse that judgment.

The law applicable to the facts stated was declared in the case of Fort Smith Light & Traction Co. v. Bourland, supra, and the remonstrants insist that the facts in the two cases are substantially similar, and'that the decision on the present appeal should therefore be controlled ’by the former decision.

We have concluded that appellees are correct in this contention, and that the judgment of the circuit court should be affirmed.

Appellant insists that the testimony is substantially different, and that the decision in the Bourland case is not decisive of this appeal.

It is insisted that the testimony in the former case showed that the patronage on the part of the line which it was proposed to abandon would probably increase, whereas no such showing was made in the instant case. Theré was testimony, however, that, because there was a mountain on one side of Van Burén and the Arkansas River on the other, the future growth of that city would be in the section of the city served by the track which appellant now seeks to abandon.

It is insisted that it appeared in the former case that the maintenance and continued operation of the track sought to be abandoned would serve the public convenience, whereas the testimony here shows that the pub-lie convenience would be subserved by abandoning the portion of the track in question, and building- the improved highway. The testimony shows, however, that, while the proposed improved road is desirable, the route thereof is not the only one available, and that, if it were built, it could not supply the loss of street car service to many people who do not own automobiles.

In the former case the track had been used for twenty years, while in the instant case it was used only about eight years. But in this case, as in that, the track is not a mere lateral but is an extension of the main line. This extension was built in partial consideration of a donation of $2500 made by the Falcon Zinc & Smelting Company, this being a manufacturing* plant built at the end of the extended line. It appears that more than 150 men are employed in this plant, only a few of whom own automobiles. It 'also appears that an addition known as the Rea Addition had been opened up at the end of this line, and that a number of people had bought or built homes there who worked in Fort Smith, and that, in doing so they had relied on the street car service to provide means of going to and returning from Fort Smith, where they were employed, and that these people could not reside there and work in Fort Smith if the service were discontinued.

The trial court found, and the testimony supports the finding, that the part of the track sought to be abandoned is only 1.08 miles in length, and is a part of the street railway system of Yan Burén, and should be treated as such, and that a sufficient showing was not made to justify the company in abandoning the unprofitable portion thereof.

, This finding is affirmed upon the authority of the decision of this court in Fort Smith Light & Traction Co. v. Bourland, supra.

Hart. J.. dissents.


author: Humphreys, J.

text:
    Pickett v. State.
    Opinion delivered October 12, 1925.
    Indictment and information — 'Wrongful procuring of public funds — variance.—Under Crawford & Moses’ Digest, § 2833, making it unlawful to receive public funds for one’s own use, one cannot be convicted upon proof that ihe received funds upon warrants issued to him under the order of the county court, though the proof might tend to show that he obtained the funds under false pretenses or by committing perjury in verifying the claim.
    Appeal from Hempstead 'Circuit Court; J. H. McCollum, Judge;
    reversed.

      W. 8. Atkins and O. A. Graves, for appellant.

      H. W. Applegate, Attorney General, and John L. Carter, Assistant, for appellee.
   Humphreys, J.

Appellant was indicted in the circuit court of Hempstead County under § 2833 of Crawford & Moses’ Digest for the crime of unlawfully receiving public funds. He was later tried, convicted, and adjudged to serve a term of five years in the State penitentiary as a punishment therefor, and has duly prosecuted an appeal to this court from the .judgment, of conviction. The section under which .appellant was indicted, reads as follows:

“It shall be unlawful for any person or persons whomsoever to borrow or receive any public funds from any such officer, deputy, clerk, or employee, knowing the same to be public funds, and for the purpose of converting or applying the same to his or their own use or benefit, or the use or benefit of any other person or persons, or of any corporation.”

It is a part of act 137 of the Acts of the General Assembly of 1891, which was passed for the purpose of preventing officers or their deputies from lending public funds under their control to any person, persons, or corporations; and preventing any person,-persons, or corporations from borrowing or receiving such funds; and requiring the officers to pay over such funds to their successors in office. The statute was not intended to reach or cover payments of public funds in redemption of warrants or in satisfaction of orders or judgments of courts.

The' record in this case reflects that in the year 1922, ■ Hempstead Comity bought some new .jail cells from E. T. Barnum Iron Works of Detroit, Michigan, and employed appellant to install them. • After installing them, appellant presented claims to the county court in the total sum of $4,800, which included the purchase price of the cells. The claims were allowed by the court, and warrants were ordered to be issued for same. Pursuant to the judgment, the clerk of the county court issued three warrants, aggregating $4,800 in payment of the judgment, which were presented by appellant to the treasurer. The treasurer issued checks for said amount, payable to appellant, on the Hope Savings Bank & Trust Company of Hope, Arkansas, the county depository, which were collected )by •him.

There is nothing in the record tending to show that appellant unlawfully borrowed or received public'funds from any officer. On the contrary; the undisputed evidence shows that he received the fund upon warrants ■ issued under the order and judgment of the county’court. For this reason, there was a fatal variance between the proof and the allegations in the indictment. The proof might tend to show that' appellant obtained the fund under false pretenses or by committing perjury in verifying the claim, but it wholly failed to show that he unlawfully received public funds from an officer within the meaning of § 2833 of Crawford & Moses’ Digest.

On .account of the error indicated, the judgment is reversed, and the cause is remanded with directions to ’ discharge appellant.


text:
    Earl Bros. & Company v. Smith.
    Opinion delivered October 12, 1925.
    Landlord and tenant — waiver of lien. — That a landlord gave permission to his tenant to use corn anid cotton seed on which he had a lien, for rent in making a crop for another year did not constitute a waiver of such lien in favor of a junior lienor.
    Appeal from Pope Chancery Court; W. E. Atkinson, Chancellor;
    affirmed.

      Ed Gordon and J. B. Ward, for appellant.
   Humphreys, J.

Appellant and appellee each rented J. F. and W. D. Ramsey a farm to cultivate during the year 1921. The Ramseys executed a chattel mortgage to appellant on the 9th day of March, 1921, covering the crops to be raised on both farms during the year. They failed to pay appellant the indebtedness secured by the mortgage, and suit was brought on the 25th day of October, 1921 against the Ramseys to foreclose the mortgage. In the proceeding, 418 1/3 bushels of corn and 340 pounds of cotton seed was seized and sold by appellant. On the 24th day of January, 1922, appellee filed an intervention in the proceeding, claiming a landlord’s lien for rent and advances on said property for a balance of $329.75. An answer was filed by appellant denying the material allegations in the intervention.

The cause was submitted to the court upon the pleadings and testimony, which resulted in a decree against appellant and in favor of appellee for $268.56 and interest, said amount being the value of the com and seed, from which decree an appeal has been duly prosecuted to this court.

There is no material dispute in the testimony. The Ramseys lived on appellant’s farm, but in the fall they rented and removed to the Fate Linzy place. They rented appellee’s farm another year, and were permitted by him to take apart of the corn and cotton seed they raised on his farm in 1921 to the Fíate Linzy farm, where it was stored to be used in mailing their crop in 1922. This was the corn and seed which appellant seized and sold in the foreclosure proceeding. When the sheriff seized it, appellee informed him that he had a landlord’s lien on it and told him not to move it. When seized'by the sheriff, it was of the value of $286.56. The Bamseys owed appellee $791.75 for rents and advances in 1921. They raised ten bales of cotton on Ms farm, and out of the proceeds of the sale thereof, paid him $462, leaving a balance due of $329.75.

C. T. Grooms, an employee of appellant, and Vernon Nisler, who was with him when they wmnt to the Bamseys to collect the indebtedness secured by the mortgage, testified that appellee told Grooms that he had given the Bamseys the corn grown on Ms farm to make a crop with the next year. Appellant denied making the statement to Grooms, but he and the Bamseys testified that he turned the corn ¡and seed over to them to use in mailing ' a crop in 1922.

Appellant contends for a reversal of the decree on the theory: first, that appellee was estopped to enforce his landlord’s lien because he did not impound the property and have it sold to satisfy the lien, but instead allowed appellant to sell the property under the mortgage lien; and, second, that appellee relinquished his landlord’s lien by permitting the Bamseys to use the corn and seed,to make their crop' the next year.

We cannot agree with appellant in either contention. In the first place, appellee did not maintain silence when he should have spoken, but, on the contrary, he informed the sheriff of his landlord’s lien and instructed him not to move the corn and seed; and, in the second place, permission to his tenants to use the corn and seed in making another crop was in no ¡sense a waiver of his lien in favor of Bamsey’s creditors. There is nothing in the record squinting at a waiver of his lieu in favor of appellant. Appellee had a perfect right to extend a favor to his tenants without thereby forfeiting Ms paramount lien rights to junior lien holders.

No error appearing, the decree is affirmed.


author: McCulloch, C. J.

text:
    Garrett v. State.
    Opinion delivered October 19, 1925.
    Fraud — obtaining pood or lodging without paying. — Crawford & Moses’ Digest, §§ 5571-2, ¡providing that any person who shall obtain food or lodging- at a hotel or boarding house and neglect to pay therefor shall be subject to a fine, etc., was intended to apply only to persons who obtain food or lodging for themselves, and not to persons who agree to pay for the accommodation of other .persons. .
    Appeal from Nevada Circuit Court; J. II. McCollum, Judge;
    reversed.

      W. 8. Athins, for appellant.

      H. W. Applegate, Attorney General, and Barden Moose, Assistant, for appellee.
   McCulloch, C. J.

Appellant was convicted of violation of the following statute:

“•Section 5571. Penalty for fraud. Any person who shall obtain food, lodging or other accommodation at any hotel, inn, boarding or eating house with intent to •defraud the owner or keeper thereof, shall be fined not exceeding one hundred dollars or be imprisoned in the county jail not exceeding three months.” Crawford & Moses Digest.
‘ ‘Section 5572. Fraudulent intent — proof. Proof that lodging, food or other accommodations were obtained by false pretenses, or by false or fictitious show or pretense of any baggage or other property, or that the person refused or neglected to pay for such food, lodging and other accommodations on demand, or that he gave in payment for such food, lodging or other accommodation negotiable paper on which payment was refused, or that he absconded without paying or offering to pay for such food, lodging or other accommodation, or that he surreptitiously removed or attempted to remove his baggage, shall be prima facie proof of the fraudulent intent mentioned in § 5571, but this act shall not apply where there has been an agreement in writing for delay in payment for a period to exceed ten days. ’ ’ Id.

The proof adduced 'by the prosecution tended to show that appellant and one Mclnturff as copartners were engaged in drilling an oil well at or near the town of Emmet, in Nevada county; that the prosecuting witness, Mrs. Vickers, was engaged in running a boarding house, and that appellant and his partner boarded their employees at Mrs. Vickers’ place and agreed to pay the board bills; and that they failed, on demand, to pay the bills of two of the employees, Powell and Terry by name. Appellant testified that during the progress of the work of drilling the well he and Mclnturff dissolved partnership, and that Mclnturff, with the consent of Mrs. Vickers, assumed the payment of the board bills. There is a controversy as to whether or not the 'bills of Powell and Terry were paid.

Our construction of the statute is that it was intended to apply only to persons who obtain food and lodging for themselves, and not to one who agrees to pay for the .accommodation of some other person. It will be observed that the statute provides that a prima facie case ' of fraud is made where a person “neglected to pay for such food, lodging or other accommodation on demand,” ■and, if we give the statute any other interpretation than that mentioned above, it would offend against the provision of the Constitution (art. 2, § 16) against “imprisonment for debt in any civil action. ’ ’ The failure or refusal of a person to pay for the accommodation of another person amounts to no more nor less than a breach of any other obligation, therefore it is not within the power of the Legislature to make this a criminal offense.

We refrain from passing upon the constitutionality of that part of the statute which makes it an offense merely for a person to neglect to pay for his own accommodations at a hotel, as that is not involved in the present case.

There is mo element of -fraud proved in the case, as the testimony adduced toy the State merely tends to show that there was a neglect or refusal on the part of appellant to pay for the accommodations of his employees.

The .judgment is reversed, and the cause dismissed.


text:
    Williams-Echols Dry Goods Company v. Bloyd.
    Opinion delivered October 19, 1925.
    1. Fraudulent conveyances — voluntary conveyance — presumption. — A voluntary conveyance by one not shown to be insolvent raises no presumption of -intention tb defraud or hinder subsequent creditors, and it devolves upon such creditors to prove that -intent.
    2. Mortgages — equitable mortgage. — A deed i-n absolute form containing a clause stating that it is executed and accepted as a mortgage to secure -a certain note, without a power of sale or defeasance clause, is an equitable, but not a legal, mortgage.
    3. Mortgages — equitable mortgage — priority over attachment.— The validity of an equitable mortgage as a security does not depend upon its prior registration, as against the lien of an attaching creditor, nor does the fact that it was executed to secure an antecedent indebtedness subordinate it to the lien of an attachment.
    Appeal from Washington Chancery Court; Sam Williams, Special Chancellor;
    affirmed.

      C. D. Atkinson and Daily $ Woods, for appellant.

      John Mayes and W. N. Ivie, for appellee.
   McCulloch, C. J.

Appellant instituted this action in the chancery court of Washington County to cancel certain conveyances of real estate executed by its debtor, J. M. Bloyd, and to subject the same to the payment of his indebtedness. -One of the conveyances sought to be canceled was- a deed made by Bloyd to his wife, Matilda, and the other was an instrument executed by Bloyd conveying1 another lot to his sister, Lissie Creekmore. It is alleged that both of these conveyances were executed by Bloyd for the purpose of defrauding creditors. Mrs. Bloyd executed a mortgage to the Arkansas National Bank of Fayetteville, and the bank was joined as a party-defendant. All of the defendants filed -answers denying the allegations of fraud, and the bank pleaded that it was an innocent mortgagee. The court in its decree made a finding against appellant on the issue of fraud and dismissed the complaint for want of equity.

It appears from the evidence that J. M. Bloyd and C. A. Wilson were co-partners engaged in the 'mercantile, business as the Yalley Trading Company, in a town in the State of Oklahoma. Bloyd resided at that place with his family and owned the two lots in controversy, in the city of Fayetteville, Arkansas. The copartnership became indebted to appellant, and the debt has not been paid. The copartnership was adjudged bankrupt and discharged from the indebtedness.

The deed of Bloyd to his wife, Matilda, was executed on December 8,1920, and was filed for record August 26, 1922.

The evidence fails, we think, to establish any fraudulent intent to hinder or defraud creditors, and the finding of the chancellor to the effect that Bloyd was not insolvent at the time of the execution of the deed is not against the preponderance of the evidence.

Counsel for appellant invoke the rule that a voluntary conveyance executed by an insolvent is conclusively void as to existing creditors, and also as against subsequent creditors where an intent to defraud them is shown. The difficulty, however, of appellant’s case is that the proof fails to show insolvency at the time of the conveyances, and also fails to -show that there was any fraudulent intent. Bloyd’s deed to his wife was executed prior to the existence of the debt to appellant, and, as before stated, there is no evidence, directly or by circumstances, sufficient to establish a fraudulent intent to defraud future creditors.

A voluntary conveyance of property raises no presumption of intention to defraud -subsequent creditors (Crampton v. Schaap, 56 Ark. 253). On the contrary, it devolves on subsequent creditors attacking such conveyance to prove an intent to defraud or hinder creditors. May v. State Natl. Bank, 59 Ark. 612; Mills v. Monroe, 96 Ark. 531; Buchanan v. Williams, 110 Ark. 335.

The deed executed by Bloydi to 'his sister, Mrs. Creekmore, ¡was executed after the debt to appellant was incurred. The deed was in absolute form conveying the legal title, except that it contained the following clause: “This deed is executed as and for a mortgage and is accepted by the grantee as such, to secure the payment of a certain promissory note of even date herewith for the sum of $3,800.” The deed contained no power of sale nor a defeasance clause, hence it was not a legal mortgage. McGuigan v. Rix, 140 Ark. 418.

At the commencement of this action appellant caused to be issued and levied on the lots an order of attachment, and the deed to Mrs. Creekmore was not filed for record until a few days after the attachment was levied. It is contended, therefore, that the deed is a mortgage and was ineffectual, until recorded, as against the lien of appellant’s attachment. The clause quoted above was sufficient to establish the fact that the deed was intended as an equitable mortgage, but, as it was not in legal form as a mortgage, its validity did depend upon registration. Martin v. Schichtl, 60 Ark. 595; Priddy & Chambers v. Smith, 106 Ark. 79. It follows, therefore, that it was not essential to the priority of the mortgag'e that it should have been recorded before the levy of the attachment. The fact that the equitable mortgage was executed to secure an antecedent indebtedness does not subordinate it to the lien of appellant’s attachment.

Our conclusion is that the decree of the chancellor was correct, and the same is affirmed.


text:
    Gerard B. Lambert Company v. Fleming.
    Opinion delivered October 19, 1925.
    1. Appeal and error — instruction—harmless error. — Conceding-that it was error in am action for breach of contract of life employment to instruct the jury to award as damages compensation which plaintiff would have received if he had been employed the remainder of his life, instead of limiting the amount of his recovery to the date of the trial, the error was harmless where the verdict allowed him compensation only from the date of his discharge up to the time of trial.
    2. Contracts — release—consideration.—A contract entered into in consideration of the release by one of the parties of a-n asserted liability is based upon a sufficient consideration.
    Appeal from Phillips Circuit Court; E. D. Robertson, Judge;
    affirmed.

      Moore, Walher & Moore, for appellant.

      Sheffield & Coates, for appellee.
   McCulloch, C. J.

Appellee instituted this action against -appellant tol -recover damages arising from an alleged breach of -contract of employment. It is alleged ■that appellee, while working in the service of -appellant, sustained personal injuries by reason of the negligence ■of other servants of appellant; that appellant entered ' into a written -contract with appellee whereby it agreed, in consideration of the release of appellant and its indemnitor from further liability on account of said personal injuries, appellant would give employment to appellee for the remainder of the latter’s life at a salary of twenty dollars per month and board, and that appellant, after giving employment to appellee for a certain time, discharged the latter from service and refused to further employ him, said discharge being without cause. Damages were asked in the sum of $10,000, and on the trial of the -cause the jury returned a verdict in favor of appellee, assessing damages in the sum of $720.

Appellant is a corporation operating in Phillips County, Arkansas, in the business of manufacturing lumber. Appellee_ sustained severe personal injuries while engaged with a -crew of men in cutting and hauling timher. This occurred in the year 1916. There is a controversy whether appellee was employed by appellant or whether he was employed by one Snyder, who is claimed to have 'been working under an independent contract with appellant, engaged in cutting and hauling logs. The testimony adduced' by appellee tends to- show that he was employed by appellant, whereas the testimony adduced on the other side tends to show that appellee was employed by Snyder, an independent contractor.

After appellee’s personal injuries occurred, a written contract was entered into between appellee and Taylor, who was appellant’s woods-foreman, and Holbrook, appellant’s general manager, whereby it was agreed that, in consideration of appellee’s release of liability of appellant from damages for the injury and also the release of the surety company from liability, appellant should give appellee employment for life as a night watchman at a salary of twenty dollars per month and board. The contract was not introduced in evidence, but appellee and Taylor both testified to its execution, and there was no denial by any witness of the fact that the. contract was executed. Appellee testified that he did not receive a copy of the contract, and that the original was retained by appellant. Appellant did not produce the contract nor attempt to controvert the fact that it was executed by Taylor and Holbrook on its behalf. It is undisputed that appellant immediately gave appellee employment as night watchman at twenty dollars per month, which was subsequently raised to thirty-five dollars per month, and gave him employment until January 3, 1921, when appellee was discharged. There is a conflict in the testimony as to whether the discharge was without just cause, and the verdict of the jury is, of course, conclusive upon the issues which were presented on conflicting evidence.

Counsel for appellant contend that an instruction should have been given submitting the question whether or not the contract was within the statute of frauds. We are of the opinion that the application of the statute of frauds is not involved in the case, for the reason that the undisputed evidence shows that the contract was in writing. The fact that the writing was not introduced in evidence does not bring it within the operation -of the statute. Appellant did not dispute the fact that the contract was made, and that it was in writing, but relied upon the contention that neither Taylor nor Holbrook had authority to enter into the contract with appellee. There was testimony tending to show that neither Holbrook nor Taylor were authorized to execute such a contract, but there was evidence sufficient to establish their, authority, or at least that it was within the apparent scope of their 'authority.

It is contended that the court erred in giving an instruction permitting appellee to recover, as damages, compensation that he would have received if he had been employed the remainder of his life, instead of limiting the amount of his recovery to compensation up to the date of the trial. 'Conceding that the court’s charge was erroneous in that respect, all prejudice was eliminated by the verdict of the jury, awarding damages for only $720, which was barely sufficient to cover the compensation from the date of discharge up to the time of the trial. It is undisputed that appellee was to receive under the contract twenty dollars per month and board, and the jury awarded damages in the sum of $720, which was precisely three years’ compensation. The verdict was rendered on April 30, 1924, which was three years and about four months after appellee’s discharge froim service. The burden of proof rested upon appellant to prove any reduction of damages that appellee could have secured through other employment (Van Winkle v. Satterfield, 58 Ark. 617), but no such proof was introduced.

It is established by adjudged cases that a contract of this character is enforceable. The validity of such a contract is based upon settled principles of law, the same as any other kind of contract. It must be based moon a consideration, but the release from an antecedent liability afforded such consideration.

Counsel contend that ithe court erred in modifying an instruction submitting, as a determining factor in the case, the question whether or not appellee was in the employ of appellant when he was injured. The instruction as requested by appellant was as follows: “Before the plaintiff can recover in this action you must find from a preponderance of the testimony that at the time of his alleged injury he was in the employ of the defendant. ’ ’ The court., over appellant’s objection, modified the instruction by adding the words, ‘ ‘ or that by the contract of release it conceded his employment.” The instruction as requested by appellant was erroneous and should have been refused, for its language made the validity of the contract depend solely upon the fact that appellee was in the employ of appellant when .injured. This is not correct for the reason that, if the contract was entered into in consideration of release by appellee of an asserted liability, there was sufficient consideration to uphold the contract. The instruction as modified by the court was therefore more favorable than appellant was entitled to, and there was no error in giving* it in that form. Nor was there any error in refusing to give it as requested.

There was evidence legally sufficient to sustain the verdict upon every issue presented in the case, and we find that the issues were properly submitted to the jury upon correct instructions.

The judgment is therefore affirmed.


author: McCulloch, • C. J.

text:
    Sturdivant v. Ka-Dene Medicine Company.
    Opinion delivered October 19, 1925.
    1. Corporations — foreign corporation — doing business in state. —In a suit on a promissory note, by a foreign corporation, an instruction that there could ibe no recovery if the appellee at the time of executing the note had not complied with the statutes with respect to the requirement that la foreign corporation file its articles of incorporation, was erroneous because there was no evidence tending to- show that plaintiff was doing business in the State, and because it ignored the question whether plaintiff was doing business in the State.
    2. Evidence — corporate existence — best evidence.- — The original 'charter of a corporation is the primary evidence of its existence, and is competent evidence, though a certified copy could be admitted in its absence.
    3. Evidence — parol proof of corporate existence. — Parol proof is admissible to prove corporate existence.
    Appeal from "Woodruff 'Circuit Court, Central District; E, D. Robertson, «Pudge;
    affirmed.

      E. M. GarlLee, for appellant.

      Rogers, Barber <& Henry and J. A. Tellier, for appellee.
   McCulloch, • C. J.

Appellee is a Tennessee corporation, and instituted this action against appellant to recover on a promissory note. Appellant, in his answer, denied the corporate existence of appellee, and also pleaded that the note was void "because appellee was doing’ business in the State without having complied with the laws thereof by filing with the Secretary of State its articles of incorporation, etc.

The proof adduced by appellee established the fact beyond dispute that the original indebtedness- of appellant was to- C. A. Sanborn for the price of shares of stock in the corporation, that Sanborn, sold the note to appellee, and that the note in suit was executed by appellant to appellee as a renewal of the original note. • San-born testified as a witness in the case and showed that he was the president of appellee -corporation, and he exhibited in evidence the articles of incorporation.

A peremptory instruction was requested by each party, and the court gave the instruction requested by appellee. Appellant also asked an instruction to, the effect that, if appellee at the time of the execution of the note had not complied with the statutes -of this State with respect to the requirement of a. foreign corporation to file its articles or- incorporation, there could be no recovery. The latter instruction was properly refused, for the reason that there was no evidence tending to show that appellee was doing business in the State, and for the further reason that the instruction ignored the question whether or not appellee was doing business in the State, and told the jury that a mere failure to comply with the statute when the note was executed barred the right of recovery in the courts of this State.

It is contended that the corporate existence could not be proved by the exhibition in evidence of the original charter, and that a certified copy was the only means of proving the existence of the charter. The original charter is the primary evidence of its existence, and is competent proof, even though a certified copy could be admitted in its absence. 3 Encyclopedia of Evidence, p. 602; 1 Fletcher on Corporations, § 472. Moreover, the witness, who was president of the corporation, testified concerning the fact of incorporation, and we have held that parol evidence is admissible to prove corporate existence. Kelley v. Stern Pub. & Nov. Co., 147 Ark. 383.

Judgment- affirmed.


author: Wood, J.

text:
    Green v. Gilbert.
    Opinion delivered October 19, 1925.
    1. Mortgages — purchase of equity of redemption by- mortgagee.— While the 'law does not inhibit a mortgagee from purchasing the equity of redemption from his debtor, it demands of him the utmost fair dealing in the transaction.
    2. Mortgages — validity of conveyance by mortgagor to mortgagee. — Evidence held to establish that an absolute deed by a mortgagor to a mortgagee conveying his equity of redemption in land was executed voluntarily for an adequate consideration and without any element of fraud or unfairness in the transaction.
    Appeal from Ouachita Chancery Court, Second Division; George M. LeCroy, Chancellor;
    affirmed.

      C. P. Harmvell, for appellant.

      T. J. Gcmghan, J. E. Gaughan, E. E. Godwin and J. T. Sifford, for appellee.
   Wood, J.

This is an action by the appellant against the appellees to set aside a certain deed executed by the appellant and his wife to one D. C. Gilbert, and :also certain leases executed by Gilbert to various parties, and a mortgage executed by Gilbert to one McClurldn. Gilbert and all the parties holding interest under instruments executed by him wereimade parties defendant.

The appellant alleged that the original deed which he seeks to have cancelled executed by him to Gilbert was in fact a mortgage given to extend the indebtedness covered by a previous mortgage which the appellant had executed to Gilbert; that the appellant executed the deed supposing that the same was a mortgage; that the consideration named in the instrument which appellant supposed was a mortgage and in fact a deed was $2,092.65. The appellant alleged that he was the owner of the lands subject to a mortgage ora the same for any indebtedness that he might be due the appellees less certain credits. He prayed that his deed to the appellees be declared a mortgage, and that he have an accounting with Gilbert, and that the excess due Gilbert over and above the mortgage indebtedness be paid the appellant.

There was an answer by the Gilberts and McClurkin, denying the material allegations of the complaint and alleging that the deed which the appellant seeks to have declared a mortgage was in fact a deed executed by the appellant to the appellee Gilbert for a consideration of $2,500, and that McClurldn, without any knowledge of any supposed equity or interest of the appellant, advanced to the appellee Gilbert the sum of $1,000 which Gilbert secured 'by a mortgage on the lands mentioned in the complaint. Answers were filed by the other appellees in which they set up the interest claimed by them from Gilbert, and alleged that they were innocent purchasers for value.

The testimony was taken ore tenus before the court and was properly authenticated and brought into the record. The appellant testified to the effect that he had been indebted to the appellee Gilbert and had mortgaged the land described in the complaint to secure such indebtedness. This mortgage was executed on November 22, 1920, by the appellant and wife and was to secure the indebtedness to Gilbert evidenced by note as recited in the mortgage in the sum of $2,092.65, due October 1, 1921, and the mortgage also covered all other indebtedness which might be due Gilbert by the appellant on the due date of the note. Gilbert wrote the appellant a note dated November 10, 1921, asking the appellant and his wife to come down that day and sign some papers. Before appellant and his wife went down, Gilbert came to appellant’s house and told the appellant and his wife that he wanted them to deed the land to him. Appellant objected, telling Gilbert that he should have the land for two years. Gilbert told appellant that he could close the mortgage at any time, and stated that the court would make a deed if appellant did not. Before the deed in controversy was executed, Gilbert brought McClure out to appellant’s house, and appellant and his wife, on the 29th of October, 1921, entered into a written contract with one McClure to' sell him the land mentioned for $2,500 in cash, to be paid on October 31, 1921. Gilbert told the appellant at that time that it would be all right for him to sell the land to McClure; that appellant would get seven or eight hundred dollars over and above the mortgage indebtedness of $2,092.65. The mortgage was not due at that time, but Gilbert told appellant that he could close it out whenever he. wanted to. Appellant further testified that he didn’t see McClure after the contract to sell him the land was executed; that the deal fell through. Appellant had paid on his mortgage to Gilbert ten bales of cotton in 1920 at 17c a pound and in 1921 seven bales at 17c a pound. Gilbert told appellant that he had given him credit for all of this cotton.

Appellant further testified that Gilbert had been after him a time or two to go with him to the bank and to tell them to turn the money over to him. The appellant was busy and didn’t go, and Gilbert wrote out these papers and got mad and cursed appellant and said the appellant had to go with him before Lester and sign the papers. He and his son-in-law marched appellant down to Lester’s to sign the papers. Gilbert had them all written out, and appellant signed thejm. Appellant then testified, giving the items, that Gilbert had advanced to appellant, amounting .in all to about $1900, which should have been a consideration named in the mort: gage, instead of the $2,000. The appellant did not owe Gilbert $500 in addition to what he owed on the mortgage. Appellant knew nothing about mathematics, and simply had to take Gilbert’s word for it. Gilbert brought appellant out in debt to him. Appellant stated that, before he made the deed to Gilbert, he went to Gilbert’s house and went over all Gilbert’s accounts with him and had a fair and square settlement, and Gilbert gave appellant credit for $2,500 and appellant still owed him $60, which he got a Mr. Kinard to pay for him. Appellant knew that he was making Gilbert a straight deed to the land. Appellant moved off the place. Gilbert wanted appellant to give him two bales of cotton, and appellant could not get it. Appellant acknowledged that he had signed certain papers addressed to the Stevens Bank, dated December 2, 1922. Appellant stated that in the first of the fall of 1921 there was .a demand for leases and royalty. The closest oil well to his land was about a mile away, and a location had been made on appellant’s land before he executed the McClure contract and the deed to Gilbert. Gilbert had told appellant not to trade with any one without his advice, and that he, Gilbert, would trade to appellant’s advantage. It was shown that the mortgage which appellant had previously executed to Gilbert was satisfied on January 18, 1923.

McClure testified that Gilbert approached him in regard to paying royalties or leases on lands, which the witness was doing at that time. Gilbert stated that he had the lands in question for sale or the mineral rights. Witness understood that Gilbert owned the land, from the way lie talked. He proposed to take witness ont and show him the land. While they were going’ out to see the lands, Gilbert told witness that he didn’t own the lands but had a mortgag-e on the same. He introduced witness to the appellant, and the contract was made and signed in Gilbert’s presence. Gilbert agreed to look after and have the abstracts prepared for the appellant. Gilbert was anxious for appellant to sell and urged the sale. Gilbert informed witness that his mortgage was for less than $2,500.

Will Green, a son of the appellant, testified substantially corroborating his father’s testimony.

There was a stipulation to the effect that all of the instruments mentioned in the complaint were to be considered in evidence; that Gilbert had sold to one Stewart, January 24, 1923, a royalty1 interest in the land for $1,000, and on November 6, 1923, a royalty to one Hill-man for $600, and a royalty interest to Pride & Winters for $660.

The testimony of the appellee was to the effect that McClure knew that appellee had a mortgage on the land when appellant entered into a contract with McClure to sell him the land. McClure refused to buy the land, stating that the abstract didn’t come up as it should. Witness tried to get appellant to sell the land. Appellant came to witness’ house and stated that, if McClure didn’t take the land, witness would have to take it. Witness denied that he threatened to foreclose and also denied that he told appellant that the court would make him give witness a deed if appellant didn’t execute the deed; that appellant and his wife went throug’h witness’ account with the witness and said it was satisfactory. The witness gave appellant credit for $2,'500. The amount named in tbe mortgage was the correct amount when the same was executed. At .the time the appellant executed the deed to witness he owed witness abalance on account of $57.65, after witness had credited him with the sum of $2,500. A man by the name of Kinard paid witness the balance of appellant’s account. Witness gave appellant back bis note and mortgage. After that appellant left the place and would not rent it from witness. Witness did not tell appellant that there would be some seven or eig'ht hundred dollars coming to him if appellant sold the place for $2,500. Witness stated that at the time he settled with the appellant he had a copy of the figures and gave appellant the amount. He could not itemize appellant’s accounts; didn’t know that he was being sued for an accounting*. He didn’t try to recollect the amounts. He had put them on his books and didn’t think he would need his books when he was testifying. He stated that he had written appellant a note to come to witness’ house to fix up some papers, and he then obtained the deed from appellant.

W. E. Gilbert,, son of appellee Gilbert, testified that appellant came to his father’s house sometime after the deed was made, and they went through appellant’s account. Witness stated that appellant was credited with the ten bales of cotton; that appellant made no objection to any item of the account ¡and was satisfied. They credited appellant with $2,500, and heK still owed $57.65. On cross-examination this witness stated that he didn’t remember the amount of cotton, rent, or any of the items with which appellant was charged, but that appellant got about $1,000 worth of provisions while maldng his one crop.

A Mrs. Yoss testified that she heard the settlement between Gilbert and Green, ¡and the settlement and account at the time were satisfactory to Green.

Witness McClurkin testified, among other things, that appellant told him after the suit was instituted that he knew he was giving Gilbert a ¡deed. The notary who took appellant’s acknowledgment to the deed stated that he didn’t tell appellant the instrument was a mortgage, but told him it was a deed*.

There were letters to the bank in evidence which appellant acknowledged signing, stating in effect that if any one should pay any money or checks into the bank to be placed to appellant’s credit as rental on the land described in the deed, he (appellant) desired that the same be placed to the credit of Gilbert, and stating that appellant had sold the land to Gilbert and had executed to him a warranty deed for the same. Gilbert testified that these letters to the bank were not obtained by him from appellant by threats or coercion of the witness or . his son-in-law, Prim. Prim testified to the same effect.

The cashier of the People’s Bank at Stephens, Arkansas, testified that he bad known the appellant for a number of years; that appellant had talked to him about the deed he.had made to Gilbert. He stated that he was having some oil and gas lease rentals paid into the bank for his account, but that he had sold the land to Gilbert, and he wanted witness to turn over the rentals to Gilbert; that Gilbert was entitled to same. Witness asked appellant to give witness a written order to that effect, which appellant did.

This action was instituted 'by. the appellant on August 27, 1923.

It is well settled, as is said by Chief Justice Cook-rill, speaking for the court in Bazemore v. Mullins, 52 Ark. 207-211, that “the law does not inhibit the mortgagee from purchasing the equity of redemption from his debtor, but demands the utmost fair dealing of him in the transaction.”

Under our statute, § § 4112 and 4113 of Crawford & Moses’ Digest, providing in substance that the party holding the affirmative of an issue must prove it, and that the burden of proof in the whole action lies upon the party who Would be defeated if no evidence were given on either side, the burden of proof in this action was upon the appellant Green to show that the absolute conveyance which he seeks to set aside was executed in extinguishment of his equity of redemption in a mortgage that he had previously executed to the appellee, Gilbert. Having shown this, he established a prima facie ease. Then the burden shifted to Gilbert, the appellee, to show that the transaction was voluntary on the part of the appellant Green and based upon an adequate consideration; that is, that Gilbert extinguished the equity of redemption and obtained an absolute conveyance of the land in controversy by satisfying a debt which Green owed Trim of the full value of the mortgaged property, or, if Green was not indebted to him in such amount, that he paid to Green the difference between the mortgage debt and the full value of the mortgaged property; and that the entire transaction was fair, frank and free from any indication of fraud, oppression and undue influence. We approve the doctrine announced by Mr. Black in his article on “Mortgages” in 27 Cyc. p. 1373, as .follows: “It is perfectly competent for the mortgagor to sell, and for the mortgagee to buy, the equity of redemption by a subsequent and independent contract entered into in good faith and for a good consideration, or for the mortgtagor to surrender the absolute ownership of the premises to the mortgagee as payment of the debt. But courts of equity scrutinize such a transaction between the parties closely and with jealous care, and will not allow it to stand unless shown to be entirely fair and honest; for the bargain will be set aside if it appears to have been induced by any fraud, artifice, overreaching, or advantage taken by the mortgagee of his commanding position with reference to the property, or of the ignorance, inexperience, or necessitous circumstances of the mortgagor. A mortgagor’s claim for relief on this ground must be made promptly, and will be denied if unreasonably delayed. ’ ’

The Supreme Court of the United States in Villa v. Rodrigues, 12 Wallace 333-339, announced the doctrine on this subject as it generally prevails throughout the American Union as follows: “The law upon the subject of the right to redeem where the mortgagor has conveyed to the mortgagee the equity of redemption is well settled. It is characterized by a jealous and salutary policy. Principles almost -as stern are applied as those which govern where a sale by a cestui que trust to his trustee 'is drawn in question. To give validity to such a sale by a mortgagor, it must be shown that the conduct of the -mortgagee was - in all things fair and frank, and that he paid for the property what it was worth. He must hold out no delusive hopes; he must exercise no undue influence; he must take no advantage of the fears or poverty of the other party. Any indirection or obliquity of conduct is fatal to his title. Every doubt will be resolved against him. Where confidential, relations and the means of oppression exist, the scrutiny is severer than in cases of a different character. The form of the instruments employed is immaterial. That the mortgagor knowingly surrendered and never intended to redeem is of no consequence. If there is vice in the transaction, the law, while it will secure to the mortgagee his debt with interest, will compel him to give back that which 'he has taken with unclean hands. Public policy, sound morals, and the protection due to those whose property is thus involved, require that such should be the law.”

In an exhaustive annotation to Mintz v. Soule, L. R. A. 1916B, at page 447, the- author says: ‘ ‘ The American courts, on the other hand, have generally taken the position that the mortgagee must discharge the burden of proving that the transaction was a fair one. In doubtful cases a continuance- of the relationships of mortgagor and mortgagee is inferred.” Numerous citations to support the text of the author of the annotation are contained in a foot note. See also 19 R. C. L. p. 386, § 160, and other authorities cited in appellant’s brief.

Now the facts are fully set forth above, and they speak for themselves. It could serve no useful purpose to discuss them in detail. The decided preponderance -of the testimony by disinterested witnesses and by witnesses who were not related to the parties shows that the deed in controversy was executed b-y Green to Gilbert voluntarily. The testimony of Mrs. Yoss and of Smith, the cashier of the Bank of Stephens, tended to prove that Green executed the instrument voluntarily, and knew at the time -that he executed an absolute conveyance to the lands in controversy. A ¡decided preponderance of the testimony in the record likewise shows that the land was not worth more than the sum of $2,500 at the time the deed was executed. There is a sharp conflict between Gilbert and his son and Green as to whether Green was due the full amount of $2,567.65, the amount claimed by Gilbert and the amount for which the settlement was made. The testimony of Gilbert and his son showed that the items of the account were gone over in the presence of Green and his wife, and that the settlement was satisfactory and made upon the basis claimed by Green. The testimony of Mrs. Voss was to the effect that she was in a position to hear all that was said at the time the settlement was made, and she corroborates Gilbert and his son. Green claimed ••that he signed the letters to the bank under duress — threats made by Gilbert and his son-in-law, but 'Gilbert and his son-in-law categorically denied that any such threats were made.

After a careful consideration of all the testimony in the record, we are convinced that the deed in controversy was executed by Green to Gilbert voluntarily and for an adequate consideration and without any element of fraud or unfairness in the transaction. Certainly, it cannot be said that the finding of the chancellor to that effect is clearly against the weight of the evidence. The correctness of such finding and decree is fortified greatly by the fact that Green, although claiming that the deed executed by him was under duress and fraud, waited for a period of almost three years before asking a court of chancery to set aside the deed. This fact tends strongly to show that Green himself knew that the deed was not obtained through fraud and duress perpetrated upon him by-the appellee Gilbert. The chancellor, therefore, was fully justified in entering a decree dismissing the appellant’s complaint for want of equity, and the same is therefore affirmed.


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    Lunsford v. Skelton.
    Opinion delivered October 19, 1925.
    Landlord and tenant — enforcement op lien. — A tenant, in making a payment to his landlord, had a right to direct that a portion of the money be paid to discharge his notes given to his merchant for supplies, which the landlord had indorsed, and where the remainder was insufficient to discharge the landlord’s lien, the landlord could enforce the same on the crop of a sub-tenant, who had not paid his rent.
    Appeal from 'Craighead Circuit Court, Lake City District; W. W. Bandy, Judge;
    reversed.

      I. G. Spencer and Little, Buck S Lasley, for appellant.
   Wood, J.

J. 'E. Lunsford rented 110 acres of land in Craighead County, Arkansas, for the year 1923, to one Newt 'Starnes for $1,000. Newt Starnes sublet 36 acres of the land to his brother, Marshall Starnes, upon the same term's and conditions; that is, at the rate of $9.09 per acre. Marshall Starnes paid to Newt Starnes in rent the sum of $127.55. Marshall was selling and removing his crop without paying the balance of 'the rent that was due, amounting to about $200. Lunsford had indorsed notes to the Farmers’ Bank & Trust Co., in Blytheville, Arkansas, for Newt Starnes in the sum of $350 to enable Newt to make his crop for the year 1923. Newt sent to Lunsford the sum of $1,000, including the $127.55 which he had obtained from Marshall for rents. At the time of making this payment of $1,000' Newt 'Starnes directed Lunsford to pay his notes at the bank and informed Lunsford that the $127.55 included in the $1,000 was rent money which Marshall had paid for the land cultivated by him. Certain cotton' raised by Mlarshall Starnes on the land of Lunsford, 'rented by Marshall from Newt Starnes, was in the hands of the constable under an attachment and an execution which had been, levied upon it by certain creditors of Marshall Starnes. Lunsford intervened in these actions, and alleged that Marshall 'Starnes was indebted to him in the sum of $200 for balance of rent for the year 1923, and that he was entitled to a lien on the cotton for such rents. The undisputed testimony of Lunsford and of Newt Starnes was to the effect that Newt Starnes directed Lunsford to pay the notes out of the $1,000 which Newt Starnes sent to Lunsford and this Lunsford did. The total of these notes with interest amounted to $377.15, leaving the sum of $622.85 in the hands of Lunsford to be applied toward his rent.

Upon the above facts the trial court found that Marshall Starnes and Newt Starnes were not indebted to Lunsford for rent for the year 1923, and that Lunsford was not entitled to,a lien on the cotton of Marshall Starnes in any sum for rent, and that Marshall Starnes was indebted to the appellees, mortgage and execution creditors, in the amount claimed by them, and rendered a judgment in their favor dismissing the claim of the intervener Lunsford. From that judgment is this appeal.

The court erred in its judgment. 'Newt Starnes, the debtor, when he paid the $1,000 to Lunsford, had the rig’ht to direct Lunsford to pay out of that sum the notes due by him to the bank, and Lunsford had the right to make such payment. There was no testimony in the record to the effect that the $1,000 paid by Newt Starnes was money derived from crops which he had grown on the land rented from Lunsford. Under the undisputed testimony the notes were given for money which the bank had advanced to Starnes upon the request of Lunsford and upon notes indorsed by him, and this was done to enable Newt Starnes to buy supplies to make his crop. The arrangement, in other words, was tantamount to an advance by Lunsford, the landlord, to his tenant, Starnes, of the amount of money evidenced by the notes to enable Starnes, the tenant, to make his crop. After deducting the amount of the notes, $377.15, from the $1,000 paid to Lunsford by Newt Starnes, and applying the balance to the payment of the rent due from Newt Starnes to Lunsford, there would still be a balance of rent due Lunsford. If this $1,000 were the proceeds of cotton raised on lands of Lunsford, Lunsford’s right under the circumstances would be superior to the rights of the mortagee and execution creditor, and he had the right to appropriate the $1,000 as the landlord to the payment of these notes which were, in effect, 'advances made by him for supplies. See § 6890, C. & M. Digest.

The undisputed testimony showed that Marshall Starnes had rented thirty-six acres of land from Newt Starnes at the same price per acre that Newt Starnes had rented from Lunsford. Marshall Starnes had paid $127.55 on his rent, and at the time he was selling and removing the cotton in controversy he owed a balance of more than $200 on his rent. Therefore, Lunsford as the landlord had a lien on this cotton superior to the mortgage and execution lien of the appellees. Sections 6889 and 6892, C. & M. Digest, and cases cited under those sections.

For the error in dismissing the intervention of the appellant Lunsford, the judgment is therefore reversed, and the cause remanded with directions to enter a, judgement in appellant’s favor for the balance due him as rental for the year 1923 and to direct that such amount be paid out of the proceeds of the sale of the crop of Marshall Starnes in the hands of the constable, and that the balance, if any, be paid to satisfy the judgment of the appellees.


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    Arkansas-Louisiana Highway Improvement District v. Parrish.
    Opinion delivered October 19, 1925.
    Highways — redemption op delinquent lands. — Section 3 of act 534 of Acts of 1921, providing for the redemption of lands delinquent in road, fencing, levee and drainage districts is not impliedly repealed, as to redemption of lands delinquent in road districts, by § 3 of act 261 of 1925; the latter section being too vague and indefinite to constitute a workable law for redemption of delinquent lands in road districts.

      Appeal from 'Chicot Chancery Court; E. G. Hammock, Chancellor;
    affirmed.

      Ed Trice, and Rose, Hemingway, Cantrell & Lough-borough, for appellant.

      DeWitt Poe and O. G. Burnside, for appellee.
   Wood, J.

Section 3 of act 534 of the Acts of 1921 provides for the redemption of lands delinquent for improvement district taxes or assessments in road, fencing, levy and drainage districts, as follows: “Any one desiring to redeem any of ©aid delinquent lands, town lots, railroads, tramroads, bridges or other real property included in said list shall apply to the clerk of the chancery court, and, upon the payment of the tax, penalty, interest and costs, the said clerk shall issue a redemption certificate in triplicate, ¡a copy of which shall he sent to the secretary of the board of commissioners of said district, a copy sent to the treasurer of said district, or the depository, if one, and said clerk shall immediately remit the amount of the tax, penalty and interest to the treasurer of the depository of said district and shall mark opposite said tract by whom redeemed and the date of such payment. For his services in filing, recording ©aid list, and issuing 'certificates of redemption, the said clerk shall be entitled to the sum of $1.00 per tract which shall he added to the same at the time of recording said list and ©hall be charged as costs against said tract.”

Act No. 261 of the Acts of 1925 is an act entitled “An act permitting road improvement districts embracing lands in more than five counties to have confirmation of their title to any lands sold to them and to provide for the payment of costs in such cases.” 'Section 3 of this act provides as follows: “Payment of delinquent road improvement district taxes to the districts described in section one of this act, and redemptions from sales for such taxes shall ibe made to the secretary of the district, and without additional cost for the act of redemption.”

The only question presented by this appeal is whether § 3 of act 261 of the Acts of 1925 repeals § 3 of act 534 of .the Acts of 1921. Section 3 of act 261 of the Acts of 1925 is too vague and indefinite to constitute a workable law for the redemption of lands from delinquent taxes or .assessments on lands in road improvement districts. No provision is made therein requiring the collector to file a list of the delinquent lands with the secretary of the district; nor is there any provision requiring the secretary of the district to apply to the collector for such list; nor is there any provision requiring the secretary of the district to apply to the clerk of the chancery court for a list of the lands which the collector, is required, under the provisions of section one of act 534, to file in his office; nor is there any provision requiring the clerk of the chancery court to furnish such list to the secretary; nor is there any provision for filing and recording such list of delinquent lands; nor for issuing certificates of redemption by the secretary of the board of the fencing districts. Section 3 of act 261 is therefore wholly incomplete as a redemption statute.

There is no express repealing clause in act 261 of any former act in conflict therewith. C'ertainly, the Legislature did not intend by this act to repeal the redemption statute provided for in such cases by act 534. The provisions of section 3 of act 261 are too loosely drawn and vague to constitute a repeal by implication of the provisions of § 3 of act 534 relating to the redemption of delinquent lands in road improvement districts.

It is contended that § 3 of act 261 repeals that part of § 3 of act 534 which allows the chancery clerk the sum of $1 as costs against the land. But there is nothing in the language to justify such construction of § 3 of act 261. The clerk of the chancery court is allowed, under act 534 of 1921, the sum of $1.00 for services in filing and recording the delinquent lands furnished him by the collector and in issuing certificates of redemption. Section 3 of act 261 is not in conflict with this provision and does not expressly purport to repeal it.

This action was brought to restrain the clerks of the chancery courts of Chicot and Desha counties from collecting or attempting to collect delinquent taxes under the provisions of act 534 of the acts of 1921, setting up in. effect that this act had been repealed by the provisions of § 3 of act 261 of the acts of 1925.

The trial court ruled that the complaint failed to state a cause of action and entered a judgment dismissing the same. The decree is in all things correct, and it is therefore affirmed.


author: Hart, J.

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    Helena Southwestern Railroad Company v. Coolidge.
    Opinion delivered October 19, 1925.
    1. Railroads — liability for fires — validity of statute. — The act of April. 18, 1907 (Crawford & Moses’ Dig., § 8569), making railroad companies liable for the destruction of or damage to property caused by fire resulting from the operation of such railroads, is not invalid as denying to such corporations due process or the equal protection of the law.
    2. Railroads — liability for fires — construction of statute. — The term “railroad,” as used in Crawford & Moses’ Dig., § 8569, refers only to railroads that are operated as common carriers, and does not apply to corporations which operate a railroad as an incident to, or in connection with an industrial enterprise.
    3. Railroads — common carriers. — 'Where defendant is a regular organized railroad company, it does not cease to be a common carrier, within Crawford & Moses’ Dig., § 8569, because it is engaged in carrying a particular kind of freight for a single customer, since it can be compelled to carry freight for all who offer it for shipment over its line.
    4. Railroads — liability for fire — evidence.-—Where grass near defendant’s railroad, track is -discovered to be on fire shortly after a train has passed, and the fire spreads to and burns the property of another, -and the proof does not establish conclusively some other origin of the fire, the jury is justified in finding that the fire originated from -the sparks of defendant’s locomotive.
    Appeal from Phillips Circuit Court; E. D. Robertson, Judge;
    affirmed.

      Moore, Walker <& Moore, for appellant.

      W. G. Dinmng, for appellee.
   Hart, J.

C. E. Coolidge sued the Helena Southwestern Eailroad 'Company to recover damages to his alfalfa field caused by fire alleged to have been communicated from a locomotive operated on the line of the railroad of the defendant.

There was a verdict and judgment in favor of the plaintiff in the sum of $1000, and the defendant has appealed to this court.

The first assignment of error is that the court erred in instructing the jury. In making this contention counsel for the defendant rely upon the action of the court in allowing the jury to find for the plaintiff independently of negligence, if it should find that the damage occurred by reason of fire communicated from the locomotive of the defendant to the alfalfa field of the plaintiff.

This court has held in St. Louis & S. F. R. Co. v. Shore, 89 Ark. 418, and numerous other cases that § 8569 of Crawford & Moses’ Digest, making railroad comr pames liable for the destruction of or damage to property caused by fire resulting from the operation of such railroads, is valid and does not deny to the railroad companies the equal protection of the law, and does not deprive them of their property without due process of law.

This court has also held that the term “railroad,” as used in this section, refers only to railroads that are operated as common carriers, and does not apply to corporations which only operate a railroad as an incident to, or in connection with an industrial enterprise. Valley Lbr. Co. v. Westmoreland Bros., 159 Ark. 484.

Counsel for the defendant seek a reversal of the judgment upon the authority of the case last cited: but in doing so have not taken into proper consideration that the principles' of law there decided have no application to the facts of the case at bar.

L. J. Wilkes, superintendent of the railroad of the defendant, was the only witness on this point. We quote from his testimony the following:

“Q. It is a railroad corporation and exercises the rights and powers of any other railroad corporation, does it not? A. Yes sir — how yon mean? Q. It is a regular railroad corporation? A. It is a regular railroad, utilized for the sole purpose of conveying logs for the Chicago Mill & Lumber Company. Q. But it is a regularly organized railroad company? A. Yes sir, it is a'regularly organized railroad company.”

In another part of his testimony, he says that his company owns -a comparatively small trackage of its own, which runs from the mill of the Chicago Mill & Lumber Company to the tracks of the Missouri Pacific Railroad Company and one of its branch lines. It stated further that these companies are regularly established railroads in the general railroad business. The defendant had standard railroad equipment which it operated in part over the tracks of these two railroad companies.

* Now, it is apparent from his testimony, that the defendant was duly organized as a railroad under the statutes of the 'State of Arkansas. -See sub-division 2 of chap. 149 relating to the incorporation, organization, and existence of railroad companies.

'Section 8450 of Crawford & Moses’ Digest defines the powers and liabilities of such corporations. Railroad corporations which are organized under the provisions referred to are given certain general powers and are subject to the general liabilities and restrictions expressed in the statute. In other words, when the defendant was organized as a railroad company, as testified to by its superintendent, it became a common carrier under the statute referred to, and has all the powers and is subject to all the restrictions of common carriers. If the defendant is a regular-organized railroad company, it can not cease to be a common carrier because it may only carry a particular kind of.- freight for a single customer. It could be compelled to carry freight for all who offered it for shipment over its line. Therefore, under the undisputed evidence, if there was liability at all on tbe part of tbe defendant, it was an absolute liability, and tbe question of negligence does not enter into the case.

It is next insisted tbat tbe evidence .is not legally sufficient to show tbat tbe fire wbieb destroyed tbe alfalfa field of tbe plaintiff was communicated by tbe operation of one of tbe defendant’s locomotives.

Tbe undisputed proof shows tbat tbe defendant operates an engine which burns coal, and tbat sparks are emitted from it which fall on its right-of-way. Tbe alfalfa field of the plaintiff burned shortly after, one of tbe defendant’s engines bad passed by it. It is tbe theory of tbe defendant tbat there was a corn field belonging to tbe plaintiff on tbe opposite side of tbe railroad track from tbe alfalfa field, and tbat tbe plaintiff’s own servants bad fired some corn-stalks; tbat the wind rose and caused tbe fire to cross tbe right-of-way of tbe defendant and burn tbe alfafa field of tbe plaintiff.

Several witnesses for tbe defendant testified tbat tbe fire was communicated to tbe alfalfa field in this way, and other facts and circumstances were introduced in evidence by it tending to show that tbe fire could not have resulted in any other way.

It can not be said, however, tbat this evidence is uncontradicted. Several witnesses for tbe plaintiff testified positively tbat there was no fire in the cornfield on the day in question, and tbat they observed a fire in some grass on tbe right-of-way of tbe defendant immediately after its engine passed, and tbat this fire spread rapidly in tbe direction of tbe alfalfa field and burned it. They saw tbe fire spread from tbe right-of-way into the alfalfa field and burn it.

This court has repeatedly held tbat where grass near a railroad track is discovered to be on fire shortly after a train has passed, and tbe fire spreads to tbe property of another and burns it, and tbe proof does not establish conclusively some other origin of tbe fire, the jury is justified in finding tbat tbe fire originated from sparks of tbe engine. Cairo, Trumann & Sou. Rd. Co. v. Brooks, 112 Ark. 298, and cases cited. As we have just seen, the evidence for the plaintiff showed that the grass commenced to burn on the right-of-way of the railroad just after one of its engines passed, and the same witnesses testified that there was no other source from which the fire might have occurred.

There is also dispute between the witnesses as to the value of the alfalfa, and as to the fact of whether it was completely destroyed by the fire. Here again the jury has settled the conflict in the evidence in favor of the plaintiff, and the evidence for the plaintiff warranted the jury in finding a much greater value for the alfalfa, which was damaged and destroyed, than that shown by the verdict of the jury.

It follows that the evidence was legally sufficient to warrant the verdict of the jury, and, there being no reversible error in the record, the judgment will be affirmed.