text:
    Gurley v. State.
    Opinion delivered May 12, 1924.
    1. Embezzlement — indictment—single offense. — An indictment against a county collector which alleges that he did “wilfully, unlawfully and feloniously and fraudulently fail and omit to pay” a certain amount to the county, said funds being the property of the county, and did “wilfully, unlawfully, and feloniously and fraudulently use said moneys and funds as aforesaid and convert the same to his own use,” held to charge a single offense, to-wit, the conversion of public funds to his own use.
    2. Criminal law — instruction—expression of opinion. — In a prosecution of a- county collector for converting funds of the county, an instruction which told the jury “that, if you find from the evidence beyond a reasonable doubt that the defendant did intentionally convert any of said moneys to his own use, then you are told that it was an unlawful and felonious conversion of said funds,” was not objectionable as an expression of opinion upon the facts.
    3. Jury — examination as to bias. — The trial court has a discretion to permit the examination of a talesman within a range reasonably calculated to disclose whether he had such bias or prejudice for or against the State or accused as is calculated to influence his verdict; and either side may ask relevant questions bearing on this subject, not only to establish actual bias which would disqualify a juror, but for the purpose of enabling the party propounding the questions to exercise intelligently his right of peremptory challenge.
    4. Criminal law — evidence.—In a prosecution of a county collector for conversion of public funds, it was not error to permit an accountant who examined the taxbooks to. testify that certain taxes appeared to be delinquent which the tax receipts showed had been paid, and that there were other instances of this kind, in addition to the specific cases which he mentioned.
    5. Criminal law — opinion op expert. — In a prosecution of a county collector for embezzlement of public funds, where an accountant who had examined the taxbooks testified as to what charges and credits were proper, it was not error to permit him to testify as to the totals.
    6. Criminal law — evidence—relevancy.—In a prosecution of a county collector for embezzlement of county funds, it was not error to exclude testimony with reference to improvement district taxes which the accused had collected.
    7. Criminal law — harmless error. — In a prosecution of a county collector for embezzlement of county funds, it was not prejudicial error to permit defendant’s successor to testify that defendant paid no funds to him upon his succession to the office.
    8. Witnesses — impeachment.—Where defendant, in a prosecution for embezzlement, admitted on cross-examination that he kept •all funds received by him, either officially or individually, in one account in a bank, and that he checked against this account for funds used by him in his private affairs, including the purchase of county warrants, and that, when he settled with the State, it was necessary to borrow money from a bank on such warrants, it was not error to examine a bank official with reference to such transaction, even though his testimony contradicted the defendant, as defendant’s cross-examination related to the offense charged, and not to a collateral matter, and therefore was not conclusive.
    9. Criminal law — argument op counsel. — It was not prejudicial error in a prosecution of a collector for embezzlement of county funds to call attention to the fact that defendant, according to his own evidence, was being paid $8,100 a year over and above his living expenses and expenses of office, such fact being competent to be considered in fixing his punishment-, if found guilty.
    Appeal from Miller Circuit Court; James H. McCollum, Judge;
    affirmed.

      John N. Cook and W. H. Arnold, for appellant.

      J. 8. Utley, Attorney General, John L. Carter, Wm. T. Hammock, Darden Moose and J. 8. Abercrombie, Assistants, for appellee.
   Smith, J.

Appellant was convicted and given a sentence of five years in tlie penitentiary upon Ms trial under the following indictment: “The grand jury of Miller County, in the name and by the authority of the State of Arkansas, accuse A. J. Gurley of the crime of failure to pay over public funds, committed as follows, to-wit: The said A. J. Gurley, in the county and .State aforesaid, on the 12th day of July, 1920, being then and there the duly elected, commissioned, qualified and acting collector, and having taken the oath of office thereof as required by law, did then and there have in his hands the sum of $31,196.03 in gold, silver and paper money of the value of $31,196.03, said moneys having come into his hands by virtue of his employment, said funds being the property of said Miller County, as aforesaid, and being then and there public funds, did then and there wilfully, unlawfully, and feloniously and fraudulently fail and omit to pay said amount to said county, due by him, the said A. J. Gurley, as collector, on settlement, and did then and. there wilfully, unlawfully, feloniously and fraudulently use said moneys and funds as aforesaid, and convert the same to his own use, against the peace and dignity of the State of Arkansas.”

There was a demurrer to the indictment on the grounds, (1) that it attempted to charge two separate offenses, and (2) that it did not state facts sufficient to constitute a public offense. The demurrer was overruled, and a motion was then made to require the State to elect upon which charge the State would proceed, and this motion was also overruled.

The indictment was based upon § 2832, C. & M. Digest, .and it is insisted that it charges appellant both with failing to pay over public funds to his successor in office, and with converting public funds to his own use, both of which acts are made unlawful by the statute referred to. We think, however, that the indictment charges only a single offense, and this a felonious conversion of the funds to his own use. It is true the indictment does allege that he failed and omitted to pay over public funds to the county; but this allegation should be treated either as surplusage or as a part of the allegation that he had converted public funds to his own use, for, after the unnecessary allegation that he had failed and omitted to pay public funds to the county, the charge is that he “did then and there wilfully, unlawfully, feloniously and fraudulently use said moneys and funds as aforesaid and convert the same to his own use, against the peace and dignity of the State of Arkansas.” We conclude therefore that the demurrer was properly overruled, as was also.the motion to require the State to elect. Ireland v. State, 99 Ark. 32; State v. Rapley, 60 Ark. 13.

The court gave, over the objection of appellant, an instruction numbered 6, reading as follows: “If you find from the evidence in this case, beyond a reasonable doubt, that the defendant was collector of taxes for Miller County, Arkansas, for the year 1920; that he collected the taxes for the year 1919, and that he had in his hands and possession moneys belonging to the county which he had collected for the taxes of 1919, and that, at any time within three years before the finding of this indictment, he failed to pay said moneys, or any part thereof, to the county, or its duly authorized officers, and unlawfully and feloniously converted said moneys or any part thereof to his own use, it will be your duty to convict him; and you are told that, if you find from the evidence beyond'a reasonable doubt that the defendant did intentionally convert any of said moneys to his own use, then you are told that it was an unlawful and felonious conversion of said funds.” This instruction was objected to on the ground that it contained a charge on the weight of the testimony, and therefore invaded the province of the jury. This objection was based on the part of the instruction which told the jury “that, if you find from the evidence beyond a reasonable doubt that the defendant did intentionally convert any of said moneys to his own use, then you are told that it was an unlawful and felonious conversion of said funds.”

It will be observed that the instruction did not contain any expression of opinion as to whether appellant had intentionally converted any of said money to his own use, but only told tbe jury that, if he had done so, this was an unlawful and felonious conversion of said funds. There was no error in this instruction. The collector had no right to convert any of the public funds to his own use, and if he, in fact, did so intentionally, his act in so doing was unlawful and a felony, and the court had the right therefore thus to define what was meant by the allegation of the indictment that the conversion was felonious.

It is insisted that error was committed in permitting certain questions to be asked H. W. Trigg, a talesman, on his voir dire examination. It appears that appellant had served two terms as sheriff and collector of Miller County, and the question of his alleged shortage was a matter discussed in the campaign for nominations by county officers. One John Edwards was a candidate for county judge, and had proclaimed his adherence to appellant and his disbelief that he was short in his accounts, and had declared his intention to dismiss the whole proceeding as unwarranted, if he were elected. Mr. Trigg was also a supporter of Edwards, and counsel for the State asked Trigg this question: “Q. I will ask you if you know that, during the primary election last summer a year ago, in which John Edwards was a candidate for county and probate judge, Mr. Gurley, the defendant, was enthusiastically in that election supporting John Edwards?” After answering this question, Trigg was also asked: “Q. Would the fact that Mr. Gurley (appellant) was John Edwards’ supporter in that election influence you in the trial of this case?” and he answered, “No sir.” He was then asked: “Q. You would go in the jury box and try him as though you and John Edwards were strangers, and you never heard of the election?” Trigg answered that he would, and he was held qualified and was accepted as a juror.

We think no error was committed in permitting the State to propound these questions. The trial court has a discretion to permit the examination of a talesman within a range reasonably calculated to disclose whether he has such bias or prejudice for or against the State or appellant as is calculated, to influence his verdict, and either side may ask relevant questions bearing on this subject, not only to establish actual bias which would disqualify a juror, but for the purpose of enabling the party propounding the questions to intelligently exercise his right of peremptory challenge. Bethel v. State, 162 Ark. 76; Corley v. State, 162 Ark. 178.

We think the questions and answers ,set out above show no abuse of the court’s discretion in this respect.

It is assigned as error that the evidence does not sustain the allegations of the indictment. The State’s case was largely dependent on the testimony of J. D. Lord, an expert accountant, who had been employed by the county to make an audit of appellant’s books, and who had devoted more than eleven months to that service. Lord testified that he arrived at the balance due by appellant, above the payments which he had made on account of his collections, by checking the taxbooks to ascertain the amount the collector was charged to collect, and by checking the taxbooks against the record of receipts to find out the proper credits for taxes not collected. This witness ascertained the valuations charged, the valuations reported paid, and the valuations returned delinquent, and testified that, after allowing the proper credits, he found appellant short in the sum of $35,555.27. Lord’s examination and cross-examination was extended, and he explained at length how he had proceeded to arrive at these figures. He illustrated his method of procedure, and testified that the property of certain taxpayers appeared on the taxbooks as delinquent, yet the tax receipt record showed that the taxes thereon had been paid. He named certain specific instances of this kind, and was asked and allowed to answer that there were such cases besides the ones he had named, and the admission of this testimony is assigned as error.

If Lord’s testimony is credited — and this was, of course, a question for the jury, it very clearly appears that appellant lacked many thousands of dollars of paying over ail money lie had collected, less the credits to which he.was entitled, including his commissions.

We think no error was committed in permitting Lord to testify that certain taxes appeared to be delinquent which the tax receipts showed had been paid. This testimony was not conclusive, and was, of course, subject to explanation, but it had probative value to show that appellant had collected taxes for which he had not accounted. Nor was there error in permitting Lord to testify that there were other instances of this 'kind in addition to the specific cases which he mentioned. Lord gave the various totals entering into his compilations, and showed what each debit and credit meant, and how it was arrived at. He had examined many valuations, and his testimony purported to show what charges and credits were proper, and it was not error to permit him to testify as to the totals.

In Ritter v. State, 70 Ark. 472, the defendant, who had been cashier of a bank, was charged with embezzling the funds of the bank. An audit of the books of the bank was made, and the auditor who had made the audit testified as to the various entries which, established the shortage. This testimony was objected to as hearsay; but this court held that it was competent as having been made by 'an expert accountant from an examination of the books, the entries upon which were numerous and of a character difficult for the jury to comprehend without the aid of an expert, and would require considerable time to read to the jury. Of course, the answer of the witness that there were other instances of the kind named was not conclusive of that fact, and appellant had the right, if he questioned the accuracy of the statement, to ask the witness to specify the other items, but, instead of doing this, he contented himself with objecting to the witness stating that there were such other items and the total thereof, which testimony, as we have said, was competent.

Error is assigned in the exclusion by the court of the testimony of witnesses Offenhauser, Sanderson and Christian. These witnesses would have identified certain receipts held by appellant for improvement district taxes which he had collected. It appears, however, that appellant stated the amount of improvement taxes which he had collected and. had paid over, and the accuracy of this testimony does not appear to have been questioned. Indeed, Lord testified that he made no audit of the taxes collected for the account of the improvement districts, and, in excluding this testimony, the court stated to the jury that the testimony was irrelevant, as no contention was made that appellant was short in those accounts. No prejudice could therefore ■ have resulted from the exclusion of this testimony.

Appellant was succeeded in office by a Mr. Eason, who testified that appellant had not paid over any funds to him upon his succession to the office of sheriff. Eason explained, however, that appellant was not required to pay him any sum whatever. We think this testimony was immaterial, and perhaps incompetent; but we do not think it could have been prejudicial. There was no contention that appellant should have paid over any money to Eason, but the testimony did show that he had not erroneously done so. Had appellant erroneously paid money to his successor which he should have paid to the treasurer of the county, this would have been, to the extent of such payment, a defense to the charge that he had converted the same to his own use, and we think it was not prejudicial error for the State to show that no such erroneous payment had been made.

Appellant admitted that, during his entire service as sheriff and collector, he had only one account at the bank with which he did business, and this account was kept in his own name as sheriff and collector, and into this account went all funds received by him, either officially or individually, and he checked against this account for funds used by himself in his private affairs. He drew numerous checks against this account for scrip which a broker bought for his private account, and he also drew checks against this account in payment of a house which he built and furnished, as well as for innumerable p'rivate purposes. Appellant admitted, as a witness, that, when he settled with the State, it became necessary for him to borrow money from a bank in Texarkana for that purpose, his explanation being that he had taken in more scrip than he could use in his settlement, and he had to borrow money on this surplus scrip. After appellant had so testified, the president of the bank was called as a witness for the State, and was asked about this loan. This testimony was objected to on the grounds, (1) that it was not proper rebuttal, and (%), that it was an attempt to impeach appellant upon a collateral matter which had been brought out in the cross-examination of appellant, and that the inquiry in regard thereto was concluded by the answer of the witness. •

We do not think that either objection was well taken. The State knew nothing of the transaction prior to the witness’ admission on the stand. The transaction was one which the State might affirmatively have proved as a part of its main case, had it been in possession of the information. It was competent for the State to show that appellant did not have funds with which to settle with the State, as tending to show his appropriation of funds which had been deposited to his account as sheriff and collector.

The president of the bank who made the loan for the bank testified that the bank took a mortgage on real estate owned by appellant as security for the loan made him, and did not accept scrip as security therefor. It is true, this testimony tended to contradict the testimony of appellant on this subject, but it was permissible to do so as this was not a matter collateral to the question whether appellant had appropriated county funds. Appellant made a settlement of his collections with the State Auditor and received a quietus from that official, and was not charged with embezzling funds belonging to the State, but this testimony tended to refute the theory of appellant’s defense that any apparent shortage — if there was one — was made to appear from the fact that improper charges were made against him and proper credits were disallowed, .and also to show that he had, in fact, used public funds which he could only replace by procuring a loan.

Appellant was asked concerning the cost of the house which he built during his term of office, and stated its cost was sixteen or seventeen thousand dollars. He admitted that his books showed an expenditure on this account of $26,868, but he explained this discrepancy by stating that he made these entries on his books to enable him to make an advantageous sale of the property.

The contractor who built the house was called, and asked what the cost of the building had been, 'and he answered that it had cost about $25,000, exclusive of the lot.

The same objection was made to this testimony as was made to the admission of the testimony of the president of the bank. Appellant admits, however, that the cost of this building, whatever it was, had been paid for with checks which he drew against his. bank account as sheriff and collector, and we think this testimony was competent. It was not a collateral matter which was concluded by appellant’s answers, but was a matter which the State had the right to prove affirmatively as tending to show that appellant had used for his private purposes the money which he was charged with having embezzled.

Error is assigned in the opening argument of special counsel for the State, who, it is insisted, said: “I stated to the jury that they were paying him, defendant, or he was being paid, according to his own evidence, over and above his living expenses and the expenses of his office, $8,100 a year, and I stated that that was a princely salary, and amounted to approximately $700 a month, and I have seen the time, and I expect the jury had seen the time, when we thought he was doing well to get $15. ”

The record reflects, however, that what counsel said was the statement quoted with this modification: “and I have seen the time, and I expect the jury had seen the time, when we thought we were doing well to get $15.”

This argument appears to have ¡been irrelevant, bnt we do not think it was prejudicial. The point of the argument is that appellant was being paid nearly $700 per month, and there was therefore no excuse for peculation on his part, when others had done well who earned only $15 per month. Whether appellant’s compensation was large or small, even in comparison with the earnings of others, was, of course, unimportant, hut we cannot say that the argument that it was large was an improper circumstance for counsel to present for the consideration of the jury in fixing appellant’s punishment, if he were found guilty, the statute having fixed the punishment for the offense charged at a time, within the discretion of the jury, at from five to twenty-one years.

No error appears, and the judgment is affirmed.


source: Caselaw Access Project

author: Humphreys, J.

license: Public Domain

text:
    Gannaway v. Street Improvement District No. 32.
    Opinion delivered May 19, 1924.
    1. Municipal corporations — board of improvement — ineligibility of member. — Crawford & Moses’ Digest, § 5652, is mandatory in requiring the appointment of three property owners within the district to constitute the board of improvement, but ineligibility of one of the appointees as not being a property owner did not render the proceedings of the board invalid, since, under § 5717, a majority of the board constituted a quorum.
    2. Municipal corporations — assessments for improvement— collateral attack. — A suit attacking the validity of a municipal assessment for lack of uniformity in apportionment of the burden, if not brought within the thirty days allowed by the statute, constitutes a collateral, and not a dirdct, attack on such assessment.
    3. Municipal corporations — improvement district — omission of strip of land. — Failure of a municipal corporation to assess a strip of land 7 inches wide and 150 feet deep out of 78,200 inches of frontage in an improvement district assessed for $67,512, ¡making the additional burden on the other property inappreciable, held not to invalidate the assessment, under the maxium, “De minimis non curat lex.”

    4. Municipal corporations — annex to street improvement— mode of assessment. — Where the assessments of benefits were made in such a way that iunds collected in an annex to a street improvement district could be kept separate from the funds of the original district, the fact that the assessments of benefits in the annex were made at the same time as in the original district, and in the same book, and recapitulated on the same page under one certificate from the county clerk, did not invalidate such assessment.
    Appeal from Pulaski Chancery Court; John E. Martineau, Chancellor;
    affirmed.

      Frauenthal & Johnson and Wallace Townsend, for appellant.
    The omission of certain property in the district rendered same invalid, because in violation of the Constitution, art. 19, § 27, providing for a uniform assessment. 48 Ark. 371; 48 Ark. 251; 125 Ark. 163. The election of a commissioner who was not a property owner, as required by C. & M. Dig., § 5652, invalidates all subsequent proceedings. 86 Ark. 1. The confusion in the assessment of benefits in the original district with the assessment in the annex renders both assessments void. 125 Ark. 65; 154 Ark. 349.

      Horace Chamberlin, for appellee.
    All acts and duties of the board have been performed by at least two legally qualified members, which constitutes a majority, within the meaning of § 5717, C. & M. Digest. Green was at least a de facto member of the board. 38 Ark. 150. See also 52 Ark. 356; 90 Airk. 335; 126 Ark. 231; 134 Ark. 535; 32 Ark. 666; 67 Ark. 484; 133 Ark. 277. The presumption of law in favor of the validity of the. assessment as made is not overcome by the facts, and, this being true, the assessment must stand. 158 Ark. 610. The seven inches of ground omitted is too slight to be considered in comparison with the whole. 87 N. E. 383; 27 Ark. 20.
   Humphreys, J.

This is a suit by property owners in Improvement District No. 362 and an annex thereto attacking the validity 'of the assessments and all the proceedings of the board of improvement appointed by the city council for the district. The bill of appellants was dismissed by tbe chancery court of Pulaski County for the want of equity, and an appeal from tbe decree of dismissal lias been duly prosecuted to this court.

Appellants contend for a reversal of the decree upon the following grounds: first, because one of the three commissioners for tbe district, appointed by the city council, was not a property owner therein; second, because the benefits were not assessed upon a strip of land seven inches wide by 150 feet long, situated between two lots in one of the blocks in tbe district; and because the assessments of the benefits for both the district and the annex were made in the same book, recapitulated on the same page, under one certificate from the board of assessors and one certificate from the clerk.

(1) It is contended that all the proceedings of the board are invalid because J. W. Green, one of the commissioners appointed by -the city council, was not an owner of real estate in the district at the time of his appointment. Section 5652 of Crawford & Moses’ Digest contains the following provision: * * the citv council shall at once appoint three persons, owners of real property therein (referring to the district), who shall constitute a board >of improvement for tbe district.” This statute is mandatory in the sense that the council must appoint three property owners in the district to direct' its affairs, but it does not follow that, because one of the persons appointed was ineligible to serve, his ineligibility rendered the proceedings of the board invalid. It is provided by % 5717, Crawford & Moses’ Digest, that “a majority of said board shall constitute a quorum for the transaction of business and the performance of the duties enjoined by this act.” The record reflects that the other two members of the board were owners of real estate in the district and eligible to act, and that the acts complained of were had and done when all three commissioners were present and participating in the proceedings. This renders it unnecessary for us to determine whether J. W. Green was- a de facto commissioner. Moreover, as hereinafter more fully appears, the validity of the assessments was not attacked until after the expiration of the thirty days allowed by the statute for that purpose.

(2) The record reflects that seven inches of land fronting on Izard Street and running back about 150 feet, lying between two lots in block 237 in said district, were omitted from the assessment of benefits made by the board of assessors, and the contention is made that this omission invalidated1 both assessments. This suit was not brought within the thirty days allowed by the statute to contest the validity of the assessments, and is therefore a collateral attack upon the assessments for lack of uniformity in the apportionment of the burden to the several lots or parcels of land, so the assessments must stand. Had the suit been brought before the statutory bar, the doctrine of “De minimis non curat lex” would apply, for it is reflected by the record that the aggregate frontage of land in the district is 78,200 inches; that the benefits assessed in the original district where the seven-inch strip is located is $67,512, so the burden which the other lands would have to carry on account of the omission of assessed benefits on the seven inches of land in question would be inappreciable.

(3) While the record reflects that the assessment of benefits was made in the annex at the same time it was made in the original district, that it was made in the same book and recapitulated on the same page under one certificate from the county clerk and one certificate from the board of assessors, it also reflects that, in making the assessment of the benefits of the lands situated in the original district, the assessor gave the description of each lot, block and parcel of land, and did assess the value of the benefits accruing to each, and did enter the same, with such descriptions, on separate pages, and followed the same'method in assessing the value of the benefits in the annex to the original district. In other words, the record shows that the assessments of benefits were made in such a way that the funds collected in the annex need not be commingled with the funds in the original district, and vice versa. This question was raised and determined adversely to the contention of appellants herein in the cases of Davis v. Cook, 159 Ark. 84, and Davis v. Road Improvement District No. 7, 162 Ark. 106, as will be seen by the following excerpt from the latter opinion:

“Again, it is contended that the assessment of benefits was void for the reason that there was not a separate assessment for the lateral roads authorized under the statute to he constructed. The statute does provide for the assessment of benefits and taxation thereon for the construction of laterals, hut it does not appear that the lands contiguous to the laterals were not separately assessed under the zone system for that purpose. It is true that the lands were all embraced in a single assessment list, but it does not follow, from this mode of assessment, that the funds arising from the taxes could not be separated so as to be devoted to the identical purposes for which they were to be collected under the statute. This same question was raised in the recent case of Davis v. Cook, 159 Ark. 84, involving the affairs of the same district, and it was decided that the assessments of the laterals were, in effect, separately made. We think that it is the same in the present case. The present proceeding is not one in which the action of the commissioners in the expenditure of funds arises, and there is no attempt to show here that the commissioners have abused their powers in using funds taxed for one part of the improvement to pay for another portion of the improvement. Of course, there is a remedy for any abuse of power, but those questions are not presented here now.”

No error appearing, the decree is affirmed.


author: McCulloch, C. J. Hart, J.,

text:
    Thompson v. Union & Mercantile Trust Company.
    Opinion delivered May 19, 1924.
    1. Taxation — nature of federal estate tax. — The estate tax imposed by the revenue act of .Congress of February 24, 1919, is not a tax upon the succession and receipt of benefits under the law or the decedent’s will, but an excise or death duty upon the transfer of his estate.

      2. Internal revenue — federal estate tax. — The United States demands payment of the estate tax from the personal representatives, but is not concerned as to who shall ultimately bear the weight of the tax, which is a question for the State courts to settle, if the beneficiaries of the estate cannot agree.
    3. Dower — widow’s estate in husband’s lands. — Under Crawford & Moses’ Dig., § 3514, providing that “a widow shall be endowed of a third part of all the lands whereof her husband was seized of an estate of inheritance at any time during the marriage, unless the same shall have been relinquished in legal form,” a widow’s dower in real estate is not subject to deduction for any part of the Federal estate tax.
    4. Dower — widow's interest in husband’s personal property.— Under Crawford & Moses’ Dig., § 3535, providing that a widow shall be endowed “absolutely and in her own right” to one-third of the personal estate whereof her husband died .seized or possessed, the widow takes dower in personalty subject to liens created prior to the husband’s death, but without deduction for any claims against the estate, including the Federal estate tax.
    Appeal from Pulaski Circuit Court, Second Division; Richard M. Ma/nn, Judge;
    reversed.

      Moore, Smith, Moore & Trieber, for appellant.
    Differing from the act of Congress of February 24, 1919, under our State statute the tax is classified with reference to the degree of relationship between the decedent and the beneficiaries, and also with reference to the amount of the gift. It is deducted from each particular legacy and distributive share, and is not imposed upon the estate as a whole. It is a tax on the right of the beneficiary to receive what passes to him from the estate, and is not a tax on the right to transmit. It is not paid out of the general assets of the estate, but is deducted by (he administrator or trustee having in charge or trust any legacy or property subject to the tax. See act 197, Acts 1913, p. 824; act 96, Acts 1917, p. 455, amending subdiv. 1 of § 1, of the Act of 1913. The Federal estate tax is imposed on the estate, and not on the particular parts thereof distributable to the beneficiaries under the intestate laws of the State, or the will of the decedent, 40 Statutes at Large, 1096, §§ 401, 402, 403, 404, 407, 408, 409. Comparison of the provisions of the former revenue act of Congress of 1898 with the later act makes plain the intention of Congress in passing the present act. See 178 U. S. at p. 62. All assets are subject to the tax as between the government and the estate, or those to whom it passes in succession, but the statute does not undertake to apportion the tax as among those to whom the estate is transferred. It is not material, for the purposes of the act, how the tax shall be apportioned among the recipients of the estate. 287 Fed. 651; 226 N. T. 407, 124 N. E., 4; 233 Mass. 471; 124 N. E. 265; 178 U. S. 41. As to the effect of the act upon the dower interest, see 267 Fed. 993; 262 Fed. 52. It may reasonably be assumed that the intention of Congress in amending the act of 1916, the act under consideration in the cases just cited, so that by subdivision (b) of § 402 of the act of 1919 it is provided that the interest of the surviving spouse shall be considered in determining the gross value of the estate, was to provide that the interest of husband or wife should be considered in determining the value of the gross estate, and should not be deducted from the gross estate under the provisions of subdivision (a) (1) of § 403. Under a recent decision of the Supreme Court of the United States, February 18, 1924, 44 Sup. Ct. '291, it was held that the Federal estate tax is not on the receipt of benefits under the law or a will, but is on the interest which ceased by reason of death. The State law determines if and how the widow is to contribute to the tax as between herself and the heirs. The opinion expressly refutes the contention of appellees that the heirs would not benefit ■by the exemptions contained in the State- tax law if the incidence of the tax is where it must be by the State law. A widow does not take dower as an heir of her husband or by virtue of the intestate laws, and same is not subject to the inheritance tax. 120 Ark. 295; 134 Ark. 71-73-74; 31 Ark. 576-579; 196 Fed. 278; 11 Ark. 94-103.

      Rose, Hemingway, Cantrell & Loughborough, .for appellee.
    Counsel for appellant attempt to draw a distinction between the State inheritance tax and the Federal inheritance tax, by calling the former an inheritance tax, and the latter an estate tax, but, in point of fact, what is taxed in both cases is exactly the same thing, namely, the transfer of the property in consequence of death. Crawford & Moses’ Digest, § 10218, provides: “A tax shall be and is hereby imposed upon the transfer of any tangible property within the State,”- etc. The Federal statute (2d Supplement to U. S. Compiled Statutes, p. 1369) provides: “A tax equal to the sum of the following percentages of the value of the net estate is hereby imposed upon the transfer of the net estate of every decedent dying after the passage of this act.” It is the transfer that is taxed in both instances. The only difference is that the State statute undertakes to determine on whom the burden shall ultimately fall, while the Federal statute only provides for the payment of the tax by the executor or administrator, leaving the distribution of the burden to the courts of the States. 287 Fed. 651. Appellant’s argument is based upon the assumption that, in our jurisprudence, the rights of the children are always to be sacrificed to those of the widow. That position was repudiated by this court at an early date, and has never found sanction in our decisions. 55 Ark. 225; 68 Ark. 449; 132 Ark. 71; 131 Ark. 232; 147 Ark. 433; 158 Ark. 255. The Legislature in 1917 passed a statute to remedy the defect in the original act, Acts 1909, p. 904, as amended by act 197, Acts 1913, which was strictly an inheritance tax and applied only to estates descended, and under which it was held that no inheritance tax was chargeable against the widow’s dower (120 Ark. 295), and under it the words “estate” and “property” were made to include the widow’s dower or any property granted or devised in lieu thereof. Act 96, Acts 1917, p. 455. This statute was construed to mean that, although it made no provision for the payment of any part of the tax by the widow, the inclusion of the widow’s dower in the description of property taxable meant that she should pay her share of the inheritance tax. 156 Ark. 169. The original act of Congress creating inheritance taxes (6 U. S. Comp. Stat., p. 7364) likewise provided for a tax which was strictly an inheritance tax, and expressly exempted widow’s dower. It was probably the construction of this statute as inapplicable to the widow’s dower, in Randolph v. Craig, 267 Fed. 993, that occasioned the passage of the statute of February 24, 1919 (Supplement 1919 U. S. Comp. Stat. p.-1367), and which, at p. 1370, in § 6336%C of that volume, expressly subjects to the tax “the interest of the surviving spouse existing at the time of the decedent’s death, as' dower, curtesy, or by virtue of a statute creating an estate in lieu of dower or curtesy.” This tax is made a lien on the gross estate of the decedent, including the widow’s dower. See § 409 of the act. 275 Fed. 688.
   McCulloch, C. J.

The question involved is whether a part of the Federal estate tax is to be apportioned against the widow’s dower, or the tax deducted from the gross estate before the assignment of dower; or whether the widow, as against the heirs of her deceased husband, takes dower out of the gross estate without deduction of the tax and without being required to pay a proportionate part of the tax. The solution of this question depends, first, upon the interpretation of the Federal statute imposing the tax; and next, upon the interpretation of the statutes of this State providing for widow’s dower.

The Federal statute imposing the tax at the time of the death of appellee’s intestate was enacted February 24, 1919, and is found in 40 Stat. at L., pp. 1057-1096. The particular sections of the statute involved are §■§ 401-2-3. The statute provides that a tax graduated1 by percentage upon the value of the net estate shall be “imposed upon the transfer of the net estate of every decedent dying after the passage of this act. ” Section. 402 provides for the ascertainment of the value of the gross estate and declares, among other things, that it shall include the interest of the decedent to the extent ‘ ‘ of any interest therein of the surviving spouse, existing at the time of the decedent’s death as dower, curtesy, or by virtue of a statute creating an estate in lieu of dower or curtesy.” Section 403 provides for a method of ascertaining the value of the net estate by deducting from the gross estate funeral and administration expenses, claims against the estate, losses from casualties not insured against, and amounts which by law of the domicile are required for support of the dependents of the testator, but not including income taxes or estate, succession, legacy or inheritance taxes. There is an exemption of $50,000 valuation, and the graduated percentage of the tax begins with one per cent, on the first $50,000 value.

The purpose and effect of the Federal statute is very clearly interpreted in a recent decision of the Supreme Court of the United States, and we need not pursue that subject beyond the decision of the court of last resort. Young Men’s Christian Assn. v. Davis, 264 U. S. 47. The court defined the tax in the following language:

“What was being imposed here was an excise upon the transfer of an estate upon death of the owner. It was not a tax upon succession and receipt of ¡benefits under the law or the will. It was death duties as distinguished from a legacy or succession tax. What this law taxes is not the interest to which the legatees and devisees succeeded on death, but the interest which ceased by reason of the death.”

It is made clear by the decision just referred to that the tax is upon the transfer of the estate from the owner and is a lien on the net estate as a whole. It takes no account of distributive shares in the estate under State laws, and the statute does not attempt to apportion the tax, as the question of apportionment and distribution of a decedent’s estate is dependent entirely on State law. ’This is clear, not only from the express language of the decision referred to, but also 'by analysis of the effect of the decision upon the subject-matter of the litigation. In that case there was involved the estate of a citizen and resident of the State of Ohio, who died leaving a will, which, after making certain specific bequests and providing for payment of debts and funeral expenses, devised the residue of the estate to the Young Men’s Christian Association, the Young Women’s Christian Association, the American Missionary Association, and Berea College.

The Federal statute, supra, provides, in substance, for the deduction from the gross estate, in determining the amount of the taxable net estate, of the amount of all legacies or devises “to or for the use of any corporation organized exclusively for religious, charitable, scientific, literary or educational purposes.” It was contended that, as between the different distributees of the estate of the testator, the property bequeathed in the residuary clause to the charitable institutions should be distributed free from the tax for the reason that the statute deducted property so bequeathed in ascertaining the amount to be taxed, and that this, in effect, constituted an exemption from the tax of the property so deducted. Both the Supreme Court of Ohio and the Supreme Court of the United States overruled that contention and held that an exemption in favor of property devised to a charitable institution operated merely as a deduction of property so bequeathed from the amount of the gross estate and did not exempt the legatee of such property from the payment of the tax. In disposing of that contention the court said:

“There is nothing in subdivision (3) of § 403 which exempts the recipients of altruistic gifts from taxation ; it only requires a deduction of them in calculating the amount of the estate which is to measure the tax. It exempts the estate from a tax on what is thus deducted just as subdivision (4) exempts in terms the estate from taxation on its first $50,000; but this does not operate to exempt any legatee who may be entitled to the first $50,-000 in the distribution, from deduction to contribute to the tax ultimately imposed, if, by the law of the State, such should be its incidence.”

This language of the opinion of the Supreme Court of the United States completely disposes of the argument of counsel for appellee that the reference in § 402 to “any interest therein of the surviving spouse” necessarily means that the interest of the spouse in the estate of the decedent must bear its proportionate part of the tax. This reference, the same as the reference in the other subdivision to charitable bequests, only relates to the question of fixing the value of the whole estate to be taxed, and not to the apportionment of the tax to any particular part of the estate. A similar conclusion was reached by the Supreme Court of Ohio, from which the case was taken to the Supreme Court of the United States on certiorari. Young Men’s Christian Association v. Davis, 140 N. E. 114.

The: New York and Massachusetts courts also reached the same conclusion in elaborate and very convincing opinions. In re Hamlin, 226 N. Y. 407; Plunkett v. Old Colony Tr. Co., 233 Mass. 471. In the opinion of the court in the New York case cited above, attention is called to the debates in Congress on the enactment of this statute, in which it was stated by the chairman of the "Ways .and Means Committee that the design was to place the tax on the whole estate and to obviate the necessity for the government to consider State statutes of distributions in enforcing the tax.

The tax is made by the statute a lien on all of the property transferred by the death of the decedent (except certain specified value to be deducted), but the question of the apportionment of the tax between the distributive intérests is one which depends entirely upon State laws. • In a case involving this question, decided by the United .States Circuit Court of Appeals for the Second Circuit, it was said: “The United States demands payment of the estate tax from the executors, but it is not concerned who shall ultimately bear the weight of the tax, which is a question for the State courts to settle, if the legatees and devisees cannot agree.” Edwards v. Slocum, 287 Fed. 651.

We turn, then, to the laws of our own State to determine the extent of the widow’s dower. What part of an estate does the widow take as dower? The statute provides ('Crawford & Moses’ Digest, § 3514) that “a widow shall be endowed of a third part of all the lands whereof her husband was seized of an estate of inheritance at any time during the marriage, unless the same shall have been relinquished in legal form.” Section 3535, Crawford & Moses’ Digest, provides that a widow shall be endowed “absolutely and in her own right to one-third part of the personal estate, including cash on hand, bonds, bills, notes, book accounts and evidences of debt, whereof the husband died seized or possessed.”

It has been'repeatedly decided by this court that, where a widow has joined her husband in a mortgage on land, her dower is subject to the mortgage, and that she cannot require the executor or administrator to pay the mortgage out of the personal property of the estate so as to give her dower in the lands free of the mortgage. Hewitt v. Cox, 55 Ark. 225; Salinger v. Black, 68 Ark. 449; Mayo v. Arkansas Valley Trust Co., 132 Ark. 64. A description of the property assigned to the widow in the present case is not set forth in detail, .but, assuming that a portion of it was real estate, it is not shown that the lands were mortgaged.

Our statute concerning dower in personalty gives the widow one-third of the gross personal estate without any deduction. In the case of Hewitt v. Cox, supra, Judge Battle, speaking for the court concerning a widow’s dower in personalty, said:

“The wife does not acquire, by marriage, an inchoate right of dower in the personal property of her husband. He can sell, pledge, mortgage and dispose of it, free from any claim of hers, at pleasure. Her right to dower in it does not accrue until he dies, and then she only takes dower in such interest in it as he had at his death. All liens on it, when he died, take precedence of her dower. * # # .She takes dower subject to the liens existing at his death, and has no right to call on the administrator to redeem the property.”

This decision is determinative of the question that a widow takes dower in personalty subject to the liens thereon created prior to the husband’s death, but the statute does not permit deductions for claims against the estate, either for expenses of administration, funeral expenses or debts of the decedent. Trimble v. James, 40 Ark. 393; Hatcher v. Buford, 60 Ark. 169; Stull v. Graham, 60 Ark. 461. The language of the statute is that the widow shall be endowed of the personal estate “whereof the husband died seized or possessed.” Under the Federal statutes the estate tax does not accrue until the death of the decedent, for it operates as a tax on the estate for the transfer from the decedent. It does not become a lien prior to the death of the decedent, though it arises coincident with his death and the widow’s dower accrues on the whole estate at the same moment that the lien of the tax accrues. The dower interest vests immediately and without assignment becomes subject to transmission by conveyance or inheritance. Barton v. Wilson, 116 Ark. 400. The dower right and the tax lien are co-existent, but the dower right is subordinate to the tax lien for the reason that the tax is imposed on the whole estate. The tax is not taken into account in determining the amount of the estate out of which the dower is carved, but, as before stated, the statute in express tervms provides for endowment out of the whole of the personal estate of which the husband died seized or possessed. The husband died seized and possessed of the property, notwithstanding the tax which accrued at the time of his death. Hatcher v. Buford, supra. Though the tax is a lien on the whole estate, it is discharged, like other claims against the estate, out of property other than the widow’s dower, and the fact that it is a lien, and that the government may enforce that lien even against dower property, does not make the dower taxable as against-the heirs of the decedent, We have nothing to do with the justice or the policy of our laws in this regard, as that is a matter entirely for the legislative branch of government.

It follows from what we have said!, that the administrator had no right, after paying the tax out of the funds of the estate, to deduct any part from the widow’s dower.

The judgment of the circuit court is erroneous, and the same is' reversed, and the cause remanded with directions to enter a judgment in accordance with the law as announced in this opinion.

Hart, J.,

(dissenting). The constitutionality of a Federal inheritance tax is upheld in Knowlton v. Moore, 178 U. S. 41; the constitutionality of a Federal estate tax is established in New York Trust Co. v. Eisner, 256 U. S. 345.

In the latter case it was expressly held that the rights of several States to regulate descents and distributions are not constitutionally interfered with by a Federal estate tax imposed by an act of Congress. It was also decided in that case that the tax in question imposed by Congress is an estate tax, and not a legacy or succession tax.

We do not agree with the majority opinion that, because this construction has been placed upon the act of Congress by the Supreme Court of the United States, it results that the tax is a debt, and should not be considered by the court in allowing dower to the widow under our statute.

The act of Congress takes no notice of the disposition made of the estate by the testator or by the law as to intestate property, and looks only to the net estate itself as defined by the act of Congress. The statute imposes the tax on the gross estate of the decedent, and it becomes a lien upon the whole estate, and -must be discharged by payment by the executor before the estate passes to the distributees, legatees, or the widow. It is levied on the estate in the hands of the executor or personal representative of the decedent, and, under the act of Congress, the United States is entitled to its share of the estate before the claims of the widow, heirs or devisees can. be satisfied. The latter take only such part of the decedent’s estate as remains after payment of the tax, which, as we have already seen, is levied upon the whole estate of the decedent. What passes to the widow, heirs or devisees, and to which they acquire title, is the portion of the estate remaining after the payment of the Federal estate tax.

The act specifically provides for the payment of the tax by the executor. It provides that it is the purpose and intent of the act that the tax will be paid out of the estate before its distribution.

The act further provides that, unless the tax is sooner paid in full, it shall be a lien for ten years upon the gross estate of the decedent, except that such part of the gross estate as is used for the payment of charges against the estate and expenses of its administration, allowed by any court having jurisdiction thereof, shall be divested of such lien.

The executor must pay the tax out of the gross estate of the decedent, and the legatees and distributees of the estate get the remainder of the estate after deducting the amount of the tax. It is imposed before the estate reaches the legatees or distributees of the decedent, and it is a lien upon the gross estate. Therefore it seems a fair and just interpretation of the- statute to hold that the legatees and distributees of a decedent, including the widow, only get what is left of the estate after paying the tax. This is so because the act makes the tax a lien upon the whole estate, and there is nothing to distribute until after it is paid.

Mr. Justice Smith concurs in the views herein expressed, and we therefore respectfully dissent from the majority opinion.


author: Wood, J.

text:
    H. G. Pugh & Co. v. Martin.
    Opinion delivered May 19, 1924.
    1. Judgment — petition to vacate — general allegation of fraud. —A petition or motion to vacate a judgment, which alleges fraud, collusion and other irregularities, is insufficient on demurrer if it fails to set forth facts sufficient to show that any fraud was perpetrated upon the court in its rendition.
    2. Judgment — collateral attack — meritorious defense. — Judgments on collateral attack will not be vacated until a meritorious defense is alleged and proved.
    Appeal from Garland Chancery Court; Jethro P. Henderson, Chancellor;
    affirmed.

      Walter M. Purvis, for appellants.
    In the beginning the court should have ascertained the identity of the person, persons or corporation for whom the alleged trustee was acting, in order to determine the legal capacity to have said suit instituted by said trustee or agent; and should have ascertained the interest of the parties for whom he was acting, i. e., whether they had an interest therein that might be maintained at law or in equity. A trustee or agent will not be allowed to maintain an action without disclosing the identity of the party for whom he is acting. . C. & M. Digest, ■§ 1087; 148 Ark. 323. If there is any misrepresentation or concealment in a judicial sale, the same will not be upheld. 84 S. W. 720; 2 Pomeroy, Equity, 958; 2 Beach on Trustees, 518; 74 Ark. 231. In equity, it is sufficient to show facts and circumstances from which fraud may ibe inferred. 33 Ark. 425; 119 Ark. 578, 180 S. W. 757. See also 35 Ark. 483. Appellants, by their duly verified motion, alleged sufficient grounds to justify the judgment and -order of foreclosure on the prima facie showing made. 97 Ark. 560.
   Wood, J.

W. H. Martin, as trustee, on the 30th day -of May, 1922, instituted this action in the chancery court of Garland County against the De Soto Spring Corporation and others to foreclose certain deeds of trust.- He alleged that the deeds of trust and the notes which they were given to secure had been duly transferred and assigned to him. The complaint set up that there was due in the aggregate at the time of the institution of the action something over $36,000. Piled with the complaint and made exhibits were the notes and deeds of trust duly executed by the De Soto Spring Corporation, and they described the property consisting of certain real estate and personal property in the city of Hot Springs. The corporation made no defense to the action, and a decree of foreclosure was entered on the 3rd of July, 1922. The decree granted the defendant five days within which to pay the debt and directed that, unless the same was paid, the property be sold, and appointed a commissioner to make the sale. On the day set for the sale, but prior to the time for the sale, the appellants intervened and filed a motion asking that the sale be postponed. The court granted the motion and reset the date for the sale. Various parties, including the appellants, filed exceptions to the repori of the proceedings by the commissioner and to the confirmation of the sale. By agreement of counsel the court set October 9, 1922, as a date for hearing all exceptions that had been filed to the report of the commissioner and the confirmation of the sale. On that date all exceptions were abandoned except those that had been filed by the appellant. The court disposed of the exceptions filed by the appellants by the following order:

“That on October 9, 1922, said petitioners presented a motion in this cause to set aside the decree of foreclosure herein, and offered proof in support of the allegations contained in said petition. The court being of the opinion that the allegations of said petition constituted no defense to the action, said action being founded upon promissory notes of the defendant, De -Soto Spring Corporation, secured by mortgages, and that no legal defense to said notes and mortgages was set up in said petition; that the facts alleged in said petition did not, if true, constitute fraud; that there were no sufficient allegations in said petition to show that said action was not properly 'brought, aad no defense having been made thereto up to the date of the judgment and decree in favor of plaintiff adjudging a foreclosure of said mortgages; the only issue in the trial being the validity of the notes and mortgages which were due and unpaid at the time of the decree, and upon this issue the court rendered its judgment and decree in favor of plaintiff, declaring a lien on the property described in the mortgages, foreclosing the mortgages and directing sale of the property if- the judgment should not he paid, the only question before the court at that time being the disposition of the surplus arising from the sale, concerning which the motion herein considered raises tío issue, the court is of the opinion that the motion to set aside the judgment of foreclosure and the sale had thereunder is insufficient to warrant the relief prayed for. The court therefore declined to hear proof in support of said motion, and overruled the same. From the ruling of the court the said interveners at the time excepted and prayed an appeal to the Supreme Court, which was granted. It is further ordered that this decree be entered as of date October 9, 1922, for the purpose only of showing the defendant’s offer to introduce evidence to sustain the allegations of their petition, which was refused by the court.”

The petition or motion of the appellants to vacate the court’s decree and set aside the sale contains substantially the following allegations: First, that since the rendition of the decree numerous suits have been filed against the corporation, and that judgments have been obtained through the- fraud of the executive officers of the corporation establishing liens against the corporation’s assets to the injury and damage of the petitioners. Second, that the action was instituted by "W. H. Martin, as trustee, without disclosing the true name of the owner or of the parties for whom he acted as trustee and the owners of the debt secured by the mortgage; that, but for this action on his part, certain parties, able and willing to buy the property, would have been present and become bona fide bidders at the sale. Third, that at the sale, had on September 2, 1922, under the decretal order of foreclosure herein, the property of defendant was declared sold to Nolan Blass, agent of Gras Blass Company, who had been advised of the defects of record heretofore referred to, but who is a business associate of Ike Kempner & Bros., the former owners of the $30,000 mortgage notes referred to herein in plaintiff’s complaint as having been assigned and sold to him, as trustee, and that -said Nolan Blass, having knowledge not possessed by other bidders at said sale, was thereby placed in position to bid thereat for the purchase of said property regardless of- said defects herein, which defects were as follows: No indorsement whatsoever appears on the said three notes of $10,000 each, except the notation of date and record of filing herein by the clerk of this court, and no record of the assignment of said deed of trust, given to secure said note, or a change or substitution of trustee indorsed thereon; that, as to the second mortgage of $4,000, no record herein has been made showing that same or the notes for which same were given to secure payment thereof, has been assigned to said plaintiff as trustee, or otherwise.

“Fourth. That the sale herein referred to was irregular and prejudicial to the best interests of petitioners, in that there was present at the time and place of said sale one J. M. Steele, agent for an unknown bidder, who made a bona fide offer of $55,000 for said property, which offer was $5,000 more than the price bid by Mr. Nolan Blass, agent for Gus Blass Company, to whom said property was declared sold by the commissioner, and that the said J. M. Steele, or his attorney, announced, prior to the beginning of the sale, that the bond that he would make for his bid, if he -should be declared the successful bidder, would be made through a surety company, or through bankers, and that, it being: then past the hours of business for all the local surety companies or bankers, a Saturday afternoon, followed by a Sunday, and Labor Day, Monday, a legal holiday, it might be impossible for his principal to perfect a satisfactory bond prior to a reasonable time during the next succeeding business days, or during the hours for the transaction of business by surety companies and bankers, on Tuesday following the Saturday on which said sale was'had. That there were present at least two other responsible bidders at the original and first call for bids on said property, who bid substantial sums over and above the amount for which said property was declared sold by the commissioner; that one of said bids was $54,975, or $4,975 in excess of the amount for which said property was declared sold at a subsequent or second call for bids, and that this bid was made by a nonresident bidder (Mr. August Schlafly of St. Louis, Mot), who .stated that he was the true owner of the two mortgage debts for which this foreclosure suit was alleged to have been originally brought.

‘ ‘Fifth. Further, petitioner states that, under the provisions of the charter of De Soto Spring Corporation, the owners of the preferred stock of said corporation are, under certain conditions enumerated therein, which conditions have existed for a period of time unknown to petitioner, bona fide creditors of said corporation, and that the conduct of plaintiff and others herein referred to as attempting to establish liens and priorities in behalf of certain creditors was and is prejudicial to their best interest and contrary to law and equity. That said notes were intended and calculated to defeat their just and legal rights herein.

£ Sixth. That ' certain creditors and numerous owners and holders of preferred stock of defendant, De Soto Spring Corporation, have had no valid notice or any knowledge whatsoever of the impending impairment of their interest or the possible loss of their, debt, which impairment has been brought about by conditions and circumstances solely within the knowledge of plaintiff and the executive officers of defendant corporation. ’

“And respectfully asked leave of the court to intervene herein, and for further grounds state: That petitioners had a good, meritorious and valid, legal and equitable defense to said decree of foreclosure and each of the other judgments and orders entered herein which they were prevented from making by reason of the fraud and collusion of W. H. Martin, as trustee, plaintiff, proceeding herein without due and proper disclosure of the true plaintiff in said cause, and by reason of his fraudulent and collusive acts with Oscar Dillon, F. W. Fooshe, W. E. .Shannahan, C. W. Whittaker, George W. Fooshe and C. E. Eaef, who have been representing and holding themselves out to petitioners as officers and employees of said company, the De Soto Spring Corporation.

“That the said individuals, individually, jointly and collectively, have, from time to time, fraudulently sold to petitioners certificates of stock alleged to represent interests in an alleged duly organized and authorized Arkansas incorporated company, styled De Soto Spring Corporation, when, as a matter of fact, such an incorporated company does not now and never has existed, for the reason that no compliance with the laws of Arkansas has been made by the purported organizers thereof, and the said De Soto Spring Corporation is not now and never has been a duly and legally organized incorporated company under the laws of Arkansas.

“That said Oscar Dillon, F. W. Fooshe, W. E. Shannahan, C. W. Whittaker and George W. Fooshe, representing themselves to be duly and legally authorized and acting as officers of an Arkansas incorporated company, have from time to-time procured by and with the aid and assistance of J. W. Whitlow, C. E. Eaef and various other persons now unknown to your petitioners, fraudulently and unlawfully sold certain alleged certificates of stock to them.

“That petitioners are without sufficient information upon which to form any 'belief as to the validity of the alleged mortgage debts and obligations sued upon by plaintiff.

“Petitioners deny that said mortgage debts existed, and deny that each and all other debts sued upon by plaintiff in said suit were in any way binding and valid legal liens against the property alleged to be mortgaged to secure and subject to said liens as alleged in said decree.

“Petitioners further state that they are without sufficient information to form any belief as to the legal or equitable right of said plaintiff, W. H. Martin, as trustee, to bring said suit, and petitioners further deny that said debts and obligations legally existed and that said plaintiff had any right, legally or equitably, to a decree of foreclosure to sell said property in satisfaction thereof.”

The court was correct in disposing of the appellants7 petition or motion to vacate the decree as if a demurrer had been filed thereto, and in refusing to allow appellants to introduce testimony in support of the allegations of the petition. While the petition alleges fraud, collusion, and many other irregularities, there is no allegation setting forth facts sufficient to show that any fraud was perpetrated upon the court in the rendition of its decree of foreclosure. No defense whatever is stated to the cause of action upon which the decree is based. On the contrary, the petitioners alleg*e that they are “without sufficient information upon which to form any belief as to the validity of the alleged debts and obligations sued upon by plaintiff; that they are without sufficient information to form any belief as to the legal or equitable right of said W. H. Martin, as trustee, to bring said suit.”

Neither the corporation itself nor any of those who were’ made parties defendant to the foreclosure proceedings denied the validity of the notes and deeds of trust to secure the same, which were the foundation of the foreclosure suits, and they made no suggestion that there was a defect of parties plaintiff, and set up no defense whatever to the notes and mortgages. The appellants, as general creditors of the corporation, are not in an attitude to plead the various irregularities and defects in the decree which they set forth in their petition without alleging any facts which constitute a fraud practiced upon, the court by the plaintiff in procuring the decree and without alleging any facts which constitute a defense to the foreclosure suit. Their petition or motion to vacate is in the nature of a collateral attack upon the decree of foreclosure. This decree was rendered on the ■3rd of July, 1922, and the appellants did not intervene until the 11th of September, 1922, on which day they filed a petition praying the court to set aside the sale which had been made in pursuance of the decree of foreclosure September 2, 1922, and did not file their petition to vacate the decree until October 9, 1922, the date set for the hearing of all exceptions filed to the sale. Certainly, the court was justified in not vacating this decree unless facts showing fraud in the procurement of the judgment, or some valid defense to the action, were alleged. Section 6293, O. & M. Digest, provides that a judgment shall not be vacated on motion or complaint until it is adjudged that there is a valid defense to the action in which the judgment was rendered. It is the doctrine of this court that judgments on collateral attack will not be vacated until a meritorious defense is alleged and proved. See Jerome Hdw. Lbr. Co. v. Jackson, etc., Land Corp., 160 Ark. 303; McDonald Land Co. v. Shapleigh Hdw. Co., 163 Ark. 524, and cases cited in those cases.

There is no error in the decree of the court, and it is therefore affirmed.


author: Hart, J.

text:
    Dame v. State.
    Opinion delivered May 19, 1924.
    1. Homicide — murder and manslaughter distinguished. — The presence or absence of malice distinguishes the offenses of murder and manslaughter.
    2. Homicide — malice.'—Since no one can look into the mind of another, the only way to decide upon its condition at the time of a killing is to judge from the attending circumstances.
    3. Homicide — malice—jury question. — The question of the presence or absence of malice at the time of the killing is for the jury, when there is any evidence to support its finding.

      Appeal from Randolph Circuit Court; John G. Ash-ley, Judge;
    affirmed.

      Pope & Bowers and Tom W. Campbell, for appellant.

      J. S. Utley, Attorney General, John L. Garter, Assistant, for -appellee.
   Hart, J.

Ben Dame was convicted of murder in the second degree for killing Will Decker, and his punishment was fixed by the jury at nine years in the State Penitentiary. The case is here on appeal.

The only reliance of the defendant for a reversal of the judgment of conviction is that the evidence is not legally sufficient to sustain the verdict.

The killing occurred at the home of Will Decker in Pocahontas, Randolph County, Ark., on the night of the 31st day- of October, 1923. The deceased had invited several persons, including the defendant, to his home that night for the purpose of playing poker for money. The game commenced about eight o’clock in the evening, but the defendant did not arrive until about midnight. About one o’clock a man by the name of Biggers came in, and the defendant had a quarrel with him. Decker stopped this quarrel, and the game commenced again. Decker and Dame sat at opposite ends of the table, facing each other, and the other players sat on each side of- the table between -them. The game commenced again, and Decker laid his pistol on the table beside him. Finally Dame lost some money, and commenced to curse about it. Decker told him that he was in his house and would have to stop cursing. Dame and Decker both became angry and began to quarrel. Finally Dame commenced to shoot at Decker with his pistol, and fired three shots in rapid succession. The first of the shots put out an oil lamp which was on the table by Decker. One of the other two shots killed him instantly. The lamp was lighted again immediately, and it was found that Decker had fallen over, dead. The above is the version of the shooting testified to by one of the players who sat next to Dame.

According to the testimony of one of the players who sat next to Decker, when the quarrel began, he looked at Decker, expecting him to seize Ms pistol and attempt to shoot Dame. He thought probably that be might grab the pistol. Before he looked around Dame began to shoot, and killed Decker. Dame then said, “Light the lamp, I have killed him. ’ ’

The wife of the deceased was also a witness for the State. According to her testimony she was in the next room when she heard the’shots fired. She heard a man say, “You God damned son-of-a-bitch, I will kill you!” About that time the first shot was fired, and then two-more shots were fired. .She knew Ben Dame, and recognized his voice as that of the man speaking the words quoted above. After the shooting she heard Dame say, “God damn son-of-a-bitch, if you are not dead, you soon will be.” All of the players, including the defendant, left the house after her husband was killed.

A son of the deceased was also a witness for the State. According to his testimony, he was asleep in another room in the house when the shots were fired. The firing of the shots awakened him, and he heard the voice of Ben Dame saying, “If you ain’t dead, damn you, you will be.” He heard the voice in the room where Ms father was shot. He went into the room and found Ms father lying on the floor, dead, with his pistol under one of his legs. He did not remember which leg; but his mother testified that it was under the left leg of the deceased. Both mother and son said that the deceased was right-handed.

It was shown by other witnesses that Decker had served a term in the penitentiary, and thought that Dame assisted in convicting him. He expressed himself that way, and on several occasions threatened to kill Dame for it. One of the threats was made only a short time before the killing, and several witnesses testified that they had communicated the threats to Dame.

Other witnesses for the defendant who were present when the killing occurred testified that Decker first attempted to shoot Dame, and that Dame then shot Decker three times in rapid succession and killed him. "Whether the offense is murder or manslaughter depends upon the presence or absence of malice. Malice in connection with the crime of killing may be express or implied. Inasmuch as no one can look into the mind of another, the only way to decide upon its condition at the time of the killing is to judge from the attending circumstances, and the question of the presence or absence of malice at the time of the killing is for the jury when there is any evidence to support its finding. King v. State, 117 Ark. 82; Reed v. State, 102 Ark. 525; Sweeney v. State, 35 Ark. 585; Howard v. State, 34 Ark. 433, and Fields v. State, 154 Ark. 188.

There was a conflict between the witnesses for the State and for the defendant as to the manner in which the killing occurred. The credibility of the witnesses was for the jury. Both the defendant and the deceased were armed. ’ The deceased had previously threatened the life of the defendant, and these threats had been communicated to him, yet he accepted an invitation of the deceased to come to his home on the evening in question and play poker for money. He went armed, and saw that deceased was armed also. They had a quarrel, and the other players interposed and stopped them. The game commenced again, with the defendant and the deceased sitting facing each other at opposite ends of the table. They began quarreling again, and the defendant fired three shots in rapid succession and killed the deceased. The deceased did not fire at all.

According to the testimony of the wife of the deceased, the defendant used language just before and just after he shot the deceased which indicated that he was acting in a spirit of malice or revenge, and not in self-defense, or in the sudden heat of passion when he shot the deceased.

The jury by its verdict believed the testimony of the witnesses for the State, and found their statements to be true. Malice may arise on the instant, and the jury may have found that the defendant was actuated by express malice in killing the deceased.

It follows that the evidence is legally sufficient to, support the verdict, and the judgment must be affirmed.


text:
    Sander v. Blytheville.
    Opinion delivered May 19, 1924.
    1. Municipal corporations — prohibition of filling stations in street. — Const., art. 12, §§ 3 and 4, and Crawford & Moses’ Dig., §§ 7493-4, 7607-8, do not limit the power of a municipality to prohibit, by ordinance, filling stations and other service appliances on streets, alleys, or sidewalks within the fire limits of a city.
    2. Municipal corporations — general welfare clause. — Under the general welfare clause of Crawford & Moses’ Dig., §§ 7493-4, a ■ city council has a broad discretion in determining what is necessary for the public welfare, safety and convenience of the city’s inhabitants.
    3. Municipal corporations — city council’s discretion. — Though a filling station, while a purpresture, was not a public nuisance, a city council had the discretion to determine whether the welfare of the city demanded the abatement of such structures, and, • unless such discretion was exercised in an arbitrary manner or invaded constitutional rights of property, it would not be interfered with.
    4. Municipal corporations — discrimination against filling station. — That a municipal Corporation permitted “drive-in” filling stations on private property to operate, though it was necessary to drive across sidewalks to reach them, and the fire hazard was greater than a particular street filling station, did not show that an ordinance prohibiting filling stations located within the boundaries of public streets was arbitrary and discriminatory.
    5. Pleading — filling station — operation by city’s permission.— In an action to enjoin the enforcement of an ordinance prohibiting filling stations within the streets, though plaintiffs did not allege that their station was operated by the city’s permission, it will be presumed that it had been.
    6. Municipal corporations — permit for street filling station.— A city council has no power, under statute, to permit permanent operation and maintenance of a filling station in the street, and such a license, if granted, would confer no vested or irrevocable right to operate such filling station.
    7. Municipal corporations — presumption of validity of ordinance. — A municipal ordinance is presumed to he valid, and one ■ challenging its validity as being arbitrary and discriminatory must make it appear so by clear and satisfactory evidence.
    8. Appeal and error — waiver of right to relief on cross-complaint. — Where, after demurrer was sustained and plaintiff’s complaint dismissed, defendants did not ask judgment on their cross-complaint, and prosecuted no appeal from the court’s failure to grant the relief sought in such cross-complaint, they cannot predicate error thereon.
    Appeal from Mississippi Chancery Court; Archer Wheatley, Chancellor;
    affirmed.

      Gosten $ Harrison, for appellant.
    A city council cannot hy ordinance condemn an act or thing as a nuisance, unless, in its nature, situation and use, it comes within the legal notion of a nuisance. It is a question of fact. 41 Ark. 526; 64 Ark. 612. The ordinance is arbitrary, unreasonable and discriminatory, in that “drive-in” stations are permitted to operate in the fire limits, and appellants are excluded from doing so. See 127 Ark. 38; 136 Ark. 298; 184’N. W. 109. '

      Max B. Reicl, for appellee.
    Authority for the ordinance is found in §.§ 7568, 7606, 7748, C. & M|. Digest. Similar ordinances have been held valid. See 98 Ark. 156; 173 111. 91. The cases cited by appellant are not in point. They had to do with structures' and operations on private property, not on the public street. The streets of a city are dedicated for public use, and for such purpose the city council may control-them. 147 Ark. 290; 138 Ark. 329; see 28 Cyc., 857 et seq.; 176 111. 397; 246 S'. W. 706. The fact that appellant’s filling station is a permanent structure in the. streets, operated for private gain, makes it a purpresture and a nuisance per se. The right to exercise any discretion is vested in the council and not in the court, if the ordinance is not arbitrary. 136 Ark. 298. The validity must be judged by its purport and effect. 88 Ark. 263. The cause should be remanded for a hearing-on the cross-complaint, which may be done in the chancery court, since it has acquired jurisdiction. 70 Miss. 678; 21 C. J. 100. The right to recover the penalty is expressly granted by §§ 7735 and 7559 of C. & M. Digest.

      Gosten (& Harrison, in reply, for appellant.
    Appellee failed to file any cross appeal, and is barred from asking any relief thereunder. 44 Ark. 25. Penalties are not enforced by chancery courts. 229 Fed. Rep. 479; 45 So. 922; 170 S. W. 1194.
   Wood, J.

On the 5th day of December, 1922, the city council of the city of Blytheville passed the following ordinance:

“Section 1. That all gasoline filling stations, gasoline pumps, oil tanks, water hydrants, air service appliances or other automobile service equipment which is now erected, operated and maintained, or which may hereafter be erected, operated or maintained, upon the streets, alleys or sidewalks within that portion of the city of Blytheville heretofore set out and designated as the fire limits, or within one block of any church or school building within the city of Blytheville, are hereby declared to be public nuisances, forbidden to operate, and hereby ordered abated on or before January 1, 1923.
“Section 2. It shall, on and after January 1, 1923, be unlawful for any person, firm, corporation or association of persons to erect, operate, or maintain upon the streets, alleys or sidewalks within that portion of the city of Blytheville heretofore set out and designated as the fire limits, or within one block of any church, school building within the city of Blytheville, any gasoline filling station, gasoline pumps, oil tanks, water hydrants, air service appliances or any other automobile service equipment.
“Section 3. Any person, firm, corporation or association of persons found guilty of violating any of the provisions of this ordinance shall be deemed guilty of a misdemeanor, and upon conviction therefor shall be fined the sum of fifteen dollars; and each day’s violation of this ordinance shall be deemed a separate offense, and be punishable accordingly.
“Section 4. That all ordinances or parts of ordinances in conflict herewith are hereby repealed, and this ordinance shall take effect and be in force from and after the first day of January, 1923.”

This action was instituted by the appellants against the appellees, the mayor and chief of police of the city of Blytheville, to enjoin the enforcement of the above ordinance. They set out the ordinance in their complaint and allege that they maintain a gasoline filling station within the fire limits of the city of Blytheville as set out and defined in the ordinance. They allege that the tank for the gasoline is constructed underneath the city pavement with all the safeguards and protection against fire, and that the gasoline pump connected with the tank does not extend into the street, but is located between the sidewalk and curb line of the street; that the water hydrant, oil tanks and air service appliances are located at the front of their building, between the sidewalk and curb line of the street, and are in no sense a public nuisance. They say that their station is not within several blocks of any public school or church. They set up that there are two gasoline filling stations within the heart of the city and within the fire limits of the city, known as “drive-in” stations, so situated and so constructed as to subject the inhabitants of the city to much greater danger from fire than the filling station of appellant, yet the ordinance prohibiting the appellant from operating does not prohibit these drive-in stations from operating, and that the ordinance therefore arbitrarily destroys the business of the appellants while protecting that of the stations mentioned and gives the drive-in stations a monopoly on the gasoline business in the city of Blythe-ville, and that the ordinance thus deprives appellants of their property without due process of law, in violation of the 'Constitution of Arkansas and of the Fourteenth Amendment to the Constitution of the United States, and is therefore unreasonable, discriminatory and void.

The appellees demurred to the complaint on the general ground that it did not state a pause of action'. The appellants stood on the complaint, and the court entered a decree dismissing the complaint, from which is this appeal.

The question presented by this appeal is whether the ordinance under review is unconstitutional and' void because it prohibits gasoline filling stations, gasoline pumps, oil tanks, water hydrants, air service appliances or other automobile service equipment therein designated, on the streets, alleys or sidewalks within the fire limits of the city of Blytheville. Under our Constitution the General Assembly shall provide by general laws for the organization of cities and towns, and no municipal corporation shall be authorized to pass any law contrary to the general laws of the State. Article 12, §§ 3 and 4, Const, of 1874.

Sections 7493 and 7494 of Crawford & Moses’ Digest provide that municipal corporations shall have power to make and publish from time to time such by-laws or ordinances not inconsistent with the laws of the State as to them shall seem necessary to provide for the safety, preserve the health, promote the prosperity, and improve the morals, order, comfort and convenience of the inhabitants thereof.

■ Section 7568 of the Digest confers upon municipal corporations the power “to lay off, open, widen, straighten and establish, to improve and keep in order and repair, * * * streets, alleys and public grounds'.”

Section 7607 provides that “the city council shall have the care, supervision and control of all the public highways, bridges, streets, alleys, public squares and commons within the city; and shall cause the same to be kept open and in repair, and free from nuisance.”

■Section 7748 confers upon municipal corporations the power “first, to regulate the use of sidewalks, and all structures and excavations thereunder, and to require the owner or occupant of ’any premises to keep the sidewalks in front or alongside the same free from obstructions, and to ibnild and maintain suitable pavement or sidewalk improvements there along, wherever the same may become necessary to the safety or convenience of travel. * # * Fourth, to punish, prevent or remove encroachments or obstructions upon any of the streets, sidewalks, wharves or other public grounds of such city, by buildings, fences, or structures of any kind, posts, trees, or any other matter or thing whatsoever, and no statute of limitation or lapse of time that any such obstruction or encroachment may have existed, or been continued, shall be permitted as a bar or defense against any proceeding or action to remove or abate the same, or to punish for its continuance, after an order has been made by the city council or the police court for its removal or abatement.”

Under these constitutional and statutory provisions there is certainly no limitation upon the power of the city council of the city of Blytheville to prohibit by ordinance the operation, and maintenance of gasoline filling stations, gasoline pumps, oil tanks, water hydrants, air service .appliances, or any other automobile service equipment upon the streets, alleys, or sidewalks within the fire limits of the city, as provided by the ordinance under review. In exercising the power conferred upon it under the general welfare clause of the statute, the city council has broad discretion to determine what is necessary for the public welfare, safety, comfort and convenience of the inhabitants of the city. The city council likewise ha.s a similar discretion in determining what character of structure may be erected and maintained upon, over, or under the streets, alleys and sidewalks of the city so long a-s such structure does not constitute per se a common nuisance. 1 ‘ A purpresture is an encroachment upon the street, which the municipality may or may not tolerate at its option if same be not also a public nuisance.” Ruffner v. Phelps, 65 Ark. 412; Owens v. Atkins, 163 Ark. 82. Under the allegations of the appellants’ complaint, their filling station, while a purpresture, was not a public nuisance per se because they alleged that it was constructed with all safeguards and protection against fire and so as not to create any hazard or risk from that source, and likewise that its appliances do not extend into the street but are located1 between the sidewalk and curb line of the street, and therefore were not in any sense a public nuisance. But, notwithstanding these allegations, it was nevertheless within the option or discretion of the city council to determine whether the welfare of the city demanded the abatement of these structures; and, unless such discretion was exercised in an arbitary, discriminatory and unreasonable manner, or in such manner as to invade the constitutional rights of property, the court will not interfere and declare the ordinance void. See North Little Rock v. Rose, 136 Ark. 298, and cases there cited.

The complaint does not contain .any allegations which show that the ordinance is unreasonable, arbitrary and discriminatory, or that it invades appellants’ constitutional right to own and use tlieir property. The fact that the city council permitted the operation of other stations, known as “drive-in stations,” which were not situated on the street but on private lots, would not tend to show that the ordinance under review was discriminatory, even though, in order to reach these drive-in stations, it was necessary to drive across the sidewalks of the city, and even though the fire hazard was greater from such stations than from the filling station of appellants. Such ‘ ‘ drive-in ’ ’ stations, being situated upon private lots, they cannot be brought within the same class as the filling station of the appellants, which is within the boundaries of the street. Comparison cannot be made between filling stations situated on private lots and filling stations situated within the boundaries'iof the street in order to determine whether the ordinance be discriminatory and unreasonable. The right of the city council to pass the' ordinance under consideration is predicated upon the fact that the filling station of appellants is Within the street of the city and therefore a purpresture, which the' council, by an ordinance which is not arbitrary, discriminatory or unreasonable, lias tbe right to remove.

The complaint does not alleg*e that the appellants had hitherto operated and maintained their filling station by the permission of the city, but, in the absence of such allegation, the presumption would be that they have done so. Nevertheless, a city council has no power under our statute to grant a permit to permanently operate and maintain a filling station in the street. So, if such license had been granted to the appellants, it did not confer any vested or irrevocable rights upon the appellants to operate such filling station.

In Kayser v. Boise, 30 Idaho 440, it is held that “the holder of a permit to install an obstruction in a public street or thoroughfare has no property or contractual right by reason of the issuance to him of such permit; and whenever the city authorities, in their discretion, deem it necessary as a proper police measure to vacate and revoke such permit, the holder of the same has no alternative, but must comply with the order of revocation.” Hibbard & Co. v. Chicago, 173 Ill. 91, 50 N. E. 256, 40 L. R. A. 621; Snyder v. Mount Pulaski, 176 Ill. 397, 44 L. R. A. 407.

In the case of Packet Co. v. Sorrels, 50 Ark. 466-473, we held that the authorities of the town or city cannot lawfully appropriate or convert a street to uses and purposes foreign to .those for which it was dedicated. See also Helena v. Wooten, 98 Ark. 156-59, and Osceola v. Haynie, 147 Ark. 290.

Now, there is a presumption in favor of the ordinance, and one who challenges its validity, alleging it to be arbitrary, discriminatory and unreasonable, should make it so appear by clear and satisfactory evidence. North Little Rock v. Rose, supra; Standard Oil Co. v. Kearney, 184 N. W. 109. The allegations of fact set up in appellants’ complaint, admitting them to be true, are not sufficient to show that the ordinance under review was invalid. The court therefore did not err in sustaining the demurrer and dismissing the appellants’ complaint.

The appellees filed a cross-complaint, asking that the city be allowed to recover the sum of $15 per day as a penalty against the appellants for operating their filling station contrary to the ordinance. But, after the demurrer was sustained to the appellants’ complaint and the complaint was dismissed, the appellees did not then ask the court to render judgment on their cross-complaint. They did not invoke and obtain a ruling on their cross-complaint, and there is no appeal from the failure of the court to grant the relief sought in such cross-complaint. Turner v. Turner, 44 Ark. 25. The appellees therefore are not in an attitude to predicate error upon the failure of the court to rule upon their cross-complaint. The decree is in all things correct, and it is therefore affirmed.