text:
    Wakenight v. Spear & Rogers.
    Opinion delivered February 7, 1921.
    1. Contracts — restraint of trade. — Contracts in partial restraint of trade with reference to a business or profession, where ancillary to the sale of the business or profession, and the good will thereof, are valid and enforceable to the extent reasonably necessary for the protection of the purchaser.
    2. Contracts — restraint op trade. — An agreement in connection with the sale of a plumbing business not to engage in that business in the same town- so long as the purchaser was engaged therein is sufficiently limited as to time and place to be valid.
    3. Contracts — public inconvenience as affecting validity. — The fact that there was a shortage of plumbers in the town, so that the public would be greatly inconvenienced by the enforcement of an agreement not to engage in the plumbing business in the town does not prevent the enforcement of the agreement.
    Appeal from White Chancery Court; J. E. Martineau, Chancellor;
    affirmed.

      Brwndidge & Neelly, for appellant.
    Appellees have enjoyed all of the benefits under their contract of purchase which they were entitled to. Appellant remained out of business for more than three years, and then only re-entered business as a day laborer when the public demanded his services, and he in no way interfered with the business of appellees. The public interest demands a reversal of this cause under the testimony which is undisputed. Contracts in partial restraint of trade are objectionable and of doubtful propriety and ought not to prevail where it is shown. that the public will be the sufferer by the enforcement thereof; private interests ought always to yield to a reasonable demand for the public good. The court erred in granting the injunction. 6 R. C. L., § 196; 49 N. E. 1030.

      Miller & Tingling, for appellees.
    1. The contract was not intended to lessen competition or fix the price of commodities. The agreement was simply a sale of the good will of each of the parties to the other. It is true the public will suffer some inconvenience, but the. agreement was not void as against public policy. The test as to whether a contract in restraint of trade is valid is whether the restraint is reasonably necessary to protect the party in whose favor it is made, with the exception stated in 13 C. J., § 420, p. 477, that the contract or covenant by which the restraint is imposed must be incidental to and in support of a sale by which the covenantee acquires some interest in the business needing protection. The rule applies to the case at bar. 74 Am. St. 241.
    2. Contracts in partial restraint of trade only are generally upheld when the agreements are by the seller of property or business not to compete with the buyer in such a way as to derogate from the value or business sold. 13 C. J., § 411, p. 468.
    A stipulation in a bill of sale of a business that the seller will not engage in a competing business within a limited territory for a limited period of time is not contary to public policy, but will be enforced. 1913 A, Ann. Cas., p. 281. Contracts in partial restraint of trade, if reasonable and founded upon legal consideration, will be enforced. 62 Ark. 101; 91 Id. 373. The rule in 62 Ark. 101 has been uniformly followed in this State. 94 Ark. 475; 95 Id. 387, 449; 112 Id. 129.
    3. The contract was merely a sale of the good will of the business and not in restraint of trade. 3 A. L. R., p. 254, and note. On the question of consideration of public policy, the rule is stated in 6 R. C. L., § 197, p. 793; lb. 803, § 204. The cases in 127 Ark. 593 and 49 N. E. 1030, are not applicable. Under the law and the facts the decree is right.
   Smith, J.

In October, 1916, appellant Wakenight, a licensed plumber, owned and operated a plumbing shop in the city of Searcy, and carried a line of plumbing supplies. Appellees are also licensed plumbers, and operate a plumbing shop in that city, and in connection with that business were also engaged in selling certain automobile accessories.

The appellant sold all of his plumbing supplies and fixtures to the appellees, in consideration of their sale to him of all their automobile accessories and their agreement to pay him the difference between the value of the plumbing supplies sold to them and the automobile accessories and supplies sold by the appellees to the appellant. And in said contract of sale appellant bound himself not to again enter into the plumbing business in any capacity, or to be interested therein, either directly or indirectly, as long thereafter as the appellees might be engaged in said business in said city; and the appellees, on their part, agreed not to sell or be interested in the sale of automobile accessories or in the repairing of automobiles in said city. ' After said contract was entered into and the sale was made by the parties, the appellant went into the business of operating a garage for the repair of automobiles and the sale of automobile accessories in Searcy; and the appellees continued to operate their plumbing business and discontinued the sale of automobile repairs and accessories.

The parties to the contract mutually observed its terms until February, 1920, when appellant resumed work as a plumber in the city of Searcy as an employee of his brother, who owned and operated a plumbing business in that city. This suit was brought to enjoin appellant from engaging in that business; and the appeal is from a decree granting the relief prayed.

Testimony was offered at the trial below to the effect that a sewer improvement district had been organized which included the larger part of the city, and that an ordinance had been passed requiring residents therein to connect their premises with this sewer1 system, and that compliance with this ordinance within the' time limited made more plumbing work necessary than could be done by the resident plumbers, and that it was difficult and expensive to get competent plumbers elsewhere.

We think the decree should be affirmed. In the recent case of Shapard v. Lesser, 127 Ark. 590, we had occasion to construe the extent to which contracts to suppress business would be upheld. The opinion in that case cites the leading authorities and collects our own cases on the subject. This case is annotated in 3 A. L. R. 247, where cases from many States are cited. In the same volume and immediately preceding our own case of Shapard v. Lesser is found the case of Pearson v. Duncan & Sons (page 242), which is also annotated.

The contract construed in the case of Shapard v. Lesser, supra, was one in which the Marianna Cotton Oil Company contracted with another cotton oil company against erecting and operating a competing gin, and we refused to enforce that contract because, as we there said, the contract was not entered into for the purpose of protecting the Marianna Cotton Oil Company in a legitimate use of something which it had acquired by the contract, but the purpose and effect of the contract was to enable the Marianna Cotton Oil Company to enjoy an illegitimate use of something which it already had, that is, a monopoly of the ginning business. In other words, our holding was that it was contrary to public policy for two parties to make a contract whereby one might have a monopoly.

That opinion, however, recognized the right of one to sell his business and, as a means of obtaining a fair price therefor, to sell the good will accompanying it. We there said: ‘ ‘ Contracts in partial restraint of trade with reference to a business or profession, where ancillary to the sale of the business or profession and the good will thereof, are valid and enforceable to the extent reasonably necessary for the protection of the purchaser. Hampton v. Caldwell, 95 Ark. 387, 129 S. W. 816; Bloom v. Home Ins. Agency, 91 Ark. 367, 121 S. W. 293, and cases cited; Edgar Lumber Co. v. Cornie Stave Co., 95 Ark. 449, 130 S. W. 452. In such cases the vendor, by entering into and observing the covenant not to engage in his business or profession for a stipulated time in a certain .locality, secures to himself the full value of his business or profession and its good will, and such contract does not in any wise tend to stifle competition or to the detriment of the public. The good will of the business or profession has a value which the seller has an absolute right to secure in this way.”

The appellant here has not contracted to abandon his trade or to cease to follow it as a means of earning a livelihood. The restriction assumed is limited both as to time and place. He is at liberty to follow his trade anywhere except in Searcy, and that limitation will expire when appellees cease to engage in the plumbing business in Searcy. These self-imposed restrictions were assumed as an inducement to appellees to buy appellant’s business, and the law does not prevent the making of contracts of that character for that purpose.

It is no doubt true the public may suffer.some inconvenience on account of this contract; but it is that inconvenience — differing only in degree — which arises when any of these enforceable contracts in partial restraint of trade are made; and the right to make them is not denied on that account.

Judgment affirmed.


source: Caselaw Access Project

author: Humphreys, J.

license: Public Domain

text:
    Bostleman v. Hutchins.
    Opinion delivered February 7, 1921.
    Mandamus — compelling judicial action. — Mandamus will not lie to compel the chancery court to enter a decree by default, though it will lie to compel a court to entertain jurisdiction of a .cause when it erroneously refuses- to do so.
    Mandamus to Woodruff Chancery Court; A. L. Hutchins, Chancellor;
    mandamus denied.

      W. J. Dimgan, for petitioners.
    1. The chancellor erred in declining to exercise jurisdiction in the cause set out in the. petition, although the defendant entered a general appearance by filing a demurrer to the complaint.
    2. It was error to refuse to grant a default judgment. On October 9, 1920, the same being an adjourned day of court, after a general appearance and more than twenty days after the date of the general appearance, defendant not having filed any defense to the complaint. 103 Pac., July 7, 1909, Olcese v. Justice Court, etc.,; 139 Ark. 590; 91 Id. 231. See, also, 95 Ark. 302; 95 Id. 588; 35 Id. 276. The chancellor should have entered decree for default judgment, no defense having been filed. Acts 1915, p. 1081.

      Harry M. Woods, for respondent.
    Where a court has discretion, it can not be controlled by mandamus. This rule is so well settled as not to require citations. It is not the duty of the trial court to enter a default judgment regardless of discretion, on the first day of the term or at an adjourned day where the answer has not been filed. The chancellor has judicial discretion, and his discretion will not be controlled by mandamus. This is too well settled to need authorities cited.
   Humphreys, J.

This is a petition in this court for a writ of mandamus requiring A. L. Hutchins, Chancellor of Woodruff Chancery Court, Northern District, to enter a default decree in a case pending in said court, wherein petitioners were plaintiffs and B. F. Crissman, a nonresident, was defendant. The petition filed in this court set out the pleadings, rulings and orders of the court as a basis for the issuance of the writ of mandamus, which are, in substance, as follows:

A bill in equity to cancel an alleged quitclaim deed to certain lands in said county, executed by petitioners to B. F. Crissman, of date March 20, 1916, on the ground that it was procured through fraud and without consideration,

A warning order, the appointment of an attorney ad litem, proof of publication of the warning order, and the report of the attorney ad litem.

General demurrer of B. F. Crissman to the bill, filed September 13, 1920, on the ground that the bill did not state facts sufficient to constitute a cause of action, in that neither the deed, nor a copy thereof, sought to be canceled as fraudulent, was filed with the complaint as an exhibit, although referred to therein as exhibit “A.”

General motion of B. F. Crissman, filed on the same date as a demurrer, to dismiss the bill on the ground that he had not been properly served, in that the warning order was not indorsed on the complaint as required by the statute, and because it bore no date.

An order of the court, of date September 14, 1920, to the effect, that the service was insufficient and a continuance of the cause for service, notwithstanding the contention of petitioners that the filing of the demurrer and motion constituted a general appearance of the said B. F. Crissman as respondent in the cause.

The withdrawal on the same date of the demurrer by the said B. F. Crissman.

The filing on the same date of a certified copy of the quitclaim deed referred to in the bill of petitioners.

Motion of the petitioners filed the 9th day of October, 1920, which was on a day of the September adjourned term of said court, for a decree by default, reciting therein the proceedings had and done in said cause and the fact that B. F. Crissman had hot filed a response to the bill and had not asked further time to do so.

Petitioners contend for the issuance of a writ of mandamus upon the ground that the refusal to render a decree by default was in effect a declination to entertain jurisdiction of the cause, because of a mistake in the law. Petitioners invoke the rule announced in Gilbert v. Shaver, 91 Ark. 231, in support of their contention, which rule is as follows: “Where a chancery court erroneously decides, under a mistake of law, and not as a decision of fact, that it has no jurisdiction in a case, and declines to proceed in the exercise of its jurisdiction, a mandamus to proceed will lie from the Supreme Court, unless there is a specific and adequate remedy by appeal or writ of error.” In the case cited, the chancery court refused to entertain jurisdiction of the cause and transferred it to the circuit court. The record of the proceedings in the case between respondents and B. F. .Crissman for the cancellation of the deed in question does not disclose that the chancery court, the respondent in this petition, refused to entertain jurisdiction of the cause. On the contrary, the court refused to dismiss the cause on the motion of B. F. Crissman and continued it for service. It is true that, on the 9th day of October, 1920, thereafter, the court overruled a motion on the part of petitioners for a decree by default, but a refusal to grant a decree by default is not in any sense a declination to entertain jurisdiction of a cause. The record does not affirmatively, or by necessary inference, show that the court refused to entertain jurisdiction of the cause. The petitioners have not brought themselves within the rule they invoke.

The petition for mandamus is therefore denied.


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    Householder v. Harris.
    Opinion delivered February 7, 1921.
    1. Highways — plats to show boundaries op district. — Plats accompanying a petition for establishment of a road improvement district under Acts 1915, No. 338, being a part of the petition, must show the correct boundaries of the district, and must not conflict with the recitals in the petition proper.
    2. Highways — improvement district — variance in petitions. — A difference of 15.45 acres between two sets of petitions circulated for the establishment of a road improvement district under Acts 1915, No. 338, is fatal to the establishment of the district where neither set represented a majority in value, acreage or number of inhabitants therein.

      3. Highways — establishment of district — eight to contest. — One who signed a petition for the establishment of a road improvement district is not estopped from claiming that the petition was not signed by a majority in value, acreage or number of inhabitants therein, and may appeal from an order establishing the district, without withdrawing his name from the petition.
    Appeal from Prairie Circuit Court, Northern District; Geo. W. Clark, Judge;
    affirmed.

      Emmet Vaughan, for appellant.
    1. There are only two questions involved here, (1) the right of J. C. Harris and Henry 'Bull, the only appellees, to appeal from the order of the county court organizing the district, and (2) the alleged variance between the plats attached to petitions 1 to 7 and 8 to 13 inclusive.
    Appellees having signed the petition for the district and the court having granted it, they had no right to appeal. 217 S. W. 781; 105 N. E. 569. A party can not appeal from a judgment favorable to him. 33 Ind. 267; 217 S. W. 781.
    2. The court erred in striking the seven petitions because there is no variance. 138 Ark. 549; 139 Id. 277; 216 S. W. 690 ; 218 S. W. 381. Appellees have no appeal-able interest, as they obtained all they asked.

      Young $ Elms and Cooper Tlvweatt, for appellees.
    1. The court did not err in not sustaining the motion to dismiss the appeal of Harris and Bull. One who joins in a petition for a district and obtains all he asks for can not appeal, as he is estopped. 273 111. 165; 2 Page & J ones on Tax., art. 1013. 85 Ark. 304 settles the question.
    2. There was no error in striking petitions 8 to 13. The plats speak for themselves, and there is no question of variance. Acts 1915, No. 338, § 1 (A); 118 Ark. 119; 209 S. W. 82. The variance is material. 113 Ark. 566. The court, properly overruled the motion to dismiss the appeal and the motion to strike 8 to 13 from the files.
   Humphreys, J.

This is an appeal from the Prairie Circuit Court, Northern District, to reverse a judgment overruling appellants’ motion to dismiss an appeal which appellees had taken from the county court, establishing Fairmount Road Improvement District No. 13 of Prairie County, Arkansas; in sustaining appellees’ motion to strike petitions 8 to 13, inclusive, from the files; and in setting aside the order of the county court and denying the establishment of said district. Appellees had joined others, under the provisions of act 338, Acts of the General Assembly of 1915, in a petition to the county court to establish said district. For convenience in obtaining signatures, thirteen petitions were prepared and filed, in which the territory to be embraced within the district was similarly described. The plats attached to the first seven petitions embraced not only the territory described in the petitions but 15.45 acres of land in the northeast quarter of the northeast quarter of section 9, township 1 south, range 6 west,' and a part of Bayou Two, Prairie Lake. The plats attached to petitions 8 to 13, inclusive, did not include any part of said section 9, township 1 south, range 6 west, or any part of Bayou Two, Prairie Lake. Appellee J. C. Harris signed the petition numbered 1, and appellee Henry Bull signed petition No. 4. After the petitions were signed, they were all filed as one petition as a basis for procuring the establishment of said district. A remonstrance, in which appellees J. C. Harris and Henry Bull joined, was filed against the establishment of the district, on the ground that there was a material variance between the plats attached to petitions 1 to 7, inclusive, and those attached to petitions 8 to 13, inclusive, thereby rendering the territory to be embraced in said district, as well as the boundaries thereof, uncertain. In the remonstrance they sought, along with others, to have their names stricken off the original petitions, on the ground that their signatures had been secured through fraud.

The cause was submitted to the court upon the petitions, with the plats attached to each, the remonstrance and the evidence of William Radican, surveyor of Prairie County, who testified from the field notes that 15.45 acres of that part of section 9, township 1 south, range 6 west, was included within the boundaries on the plats attached to the first seven petitions, but not included within the boundaries on the plats attached to petitions 8 to- 13 inclusive, which resulted in the judgment heretofore set out in substance.

The act, under which it was sought to establish the district, authorizes the circulation among the landowners of the original petition, or such number of exact copies thereof as may be deemed necessary, and the consolidation of said petitions as one for purposes of filing and hearing. The same act requires that a plat shall be filed with the petition, upon which the boundaries of the proposed district shall be plainly indicated. This court, in construing the act in Tarvin v. Road Improvement District No. 1 of Perry County, 137 Ark. 354, said: “The map or plans, specifications and estimate of costs must be regarded as a part of the petition for the purpose of determining whether the proposed improvement is certainly and definitely described.” It has been uniformly held by this court that the recitals of a petition to form a road district must conform to the requirements of the statute, because the petition is jurisdictional. Cox v. Road Improvement Dist. No. 18 of Lonoke County, 118 Ark. 119. The plats accompanying the petition, being a part thereof, must necessarily show the correct boundaries of the district, and not conflict with the recitals in the petition proper. So it follows that, if, the plats attached to the several petitions as a part thereof show different boundaries of the proposed district, the petitions cannot be exact copies of each other. In that event the petitions would not conform to the requirements of the statute. For example, in the instant case, the plats, which were a part of the petitions and attached to petitions 1 to 7, inclusive, included more territory within the district than the plats attached to petitions 8 to 13, inclusive. It follows that the signers to petitions 1 to 7, inclusive, petitioned for a different road district from those who signed petitions 8 to 13, inclusive. It is contended, however, by appellees that the variance is so infinitesimal that it will not be noticed by the court. According to the plats attached, the first seven petitions contain 15.45 acres more land within the boundaries of the- district than is shown by the plats attached to petitions 8 to 13, inclusive. An inspection of the plats also shows that a part of Bayou Two, Prairie Lake, is included in the first seven petitions and not included in the petitions 8 to 13, inclusive. If the only variance consisted in the difference of 15.45 acres, we are not prepared to say this would not be material and fatal. In the case of Voss v. Reyburn, 104 Ark. 298, it was held that the omission of two half blocks from the proposed improvement district constituted a material variance and invalidated a street improvement district; and, in the case of Norton v. Bacon, 113 Ark. 566, it was held that the omission in the published notices of 200 acres of land constituted a material variance between the notice and the plat and invalidated the formation of the improvement district. In the case of McRaven v. Clancy, 115 Ark. 163, the court also ruled that the omission of one lot from the publication of an ordinance, creating a district, invalidated the district. This court also said, in the case of Heinemann v. Swcatt, 130 Ark. 70, that “the tract of land in question forms a very small part of the large territory embraced in the district, but we can not treat it as being too insignificant to be seriously taken into account in adjudicating the rights of the parties who own lands in the district. We do not know what its value really is compared with the other lands in the district. We must assume, at least, that it is of substantial value, and that is sufficient to call for the application of the principle herein announced, for, if we undertake to vary the application of those principles according to the amount or value involved, we would have a very uncertain rule. ’ ’

One of the grounds of remonstrance against the organization of the district in the instant case is that the petitions did not represent a majority of the landowners in the district. It is conceded that the petitions 1 to 7, inclusive, or 8 to 13, inclusive, separately did not constitute a majority in either value, acreage or number of the landowners. It is contended by appellants that appellees J. C. Harris and Henry Bull had no right to prosecute an appeal from the county court to the circuit court because they petitioned for the organization of the district, and that, at the time they remonstrated, their names had not been withdrawn from the petitions. In our view that there was a material variance between the lands proposed to be included in petitions 1 to 7, inclusive, from those proposed to be included in petitions 8 to 13, inclusive, a district could not be legally established upon either set of petitions, because neither represented a majority in value, acreage or numbr of landowners therein. It is said in Page & Jones on Taxation by Assessment, vol. 2, art. 1013, that “where a petition is by statute to be effective only if signed by a certain number, one who signs the petition is not estopped from claiming that the requisite number did not join in signing the petition.” Again, on account of the variance in the boundaries of the proposed districts, as shown by the plats, the petitioners on the two sets of petitions sought to establish different districts. Those in the first set sought to include in the district northeast quarter of the northeast quarter of section 9, township 1 south, range 6 west, and Bayou'Two, Prairie Lake, whereas, those in He second set of petitions did not include any lauds in said section 9 nor any part of Bayou Two, Prairie Lake. Appellees, therefore, did not obtain an order in the county court establishing the district prayed for, because the order of the county court establishing the district did not include any part of said section 9 or any part of Bayou Two, Prairie Lake. So appellees had a right to appeal from the order of the county court establishing a district, upon two grounds, notwithstanding they had not withdrawn their names from the original petition at the time — first, because the county court established a different district from the one petitioned for by them; second, because the petitions signed by appellees did not contain a majority in value, acreage or number of landowners in tbe district established by the county court.

No error appearing in the record, the judgment is affirmed.


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    Layton v. Central States Lead & Zinc Company.
    Opinion delivered February 7, 1921.
    1. Pleading — exhibits.—A bill in equity is not demurrable because the allegations therein are broader than the subject-matter covered by exhibits thereto, as the exhibits could not control or limit proper allegations relating to matters not covered by the exhibits.
    2. Corporations — promoters’ contract. — Under a bill alleging that a certain contract was made on behalf of a proposed corporation by its promoters, part of the consideration of which was the sale of certain stock in the corporation, which was guaranteed to be worth $2,000, and that the corporation, with knowledge of such contract, adopted the same and accepted the benefit thereof, held that the corporation was bound by the contract, including the guaranty.
    3. Corporations — adoption op promoters’ contracts. — A corporation may adopt contracts made for it by its promoters in advance of - organization as effectually as if made by it after organization, and after accepting the benefits of such contracts can not repudiate the accompanying burdens and obligations.
    4. Frauds, statute op — promoters’ contract. — A contract on behalf of a prospective corporation, made for its benefit by promoters, though not in writing, is not within the statute of frauds as being a contract to answer for the debt, default or miscarriage of another, since, on its adoption by the corporation, it became, m toto, an original undertaking of the corporation.
    Appeal from Marion Chancery Court; B. F. Mc-Mahan, Chancellor;
    reversed.

      J. C. Floyd, for appellant.
    The appellee adopted the contract made by. the promoters, Stanfield and Harrison, with plaintiff and are hound by it. The contract was made on behalf of the corporation by its promoters and the corporation after its organization, and with full knowledge of all the facts accepted its benefits and took them cum onere, and it maybe enforced against the corporation. Clark on Contracts, pp. 133-4, § 17; 44 Ark. 383; 37 Id. 164; 86 Tex. 35; 7 R. C. L., §'§ 60-1-2; Clephane on Bns. Corp., chap. 4, p. 29 ; § 48; 91 Ark. 367; 79 Id. 273; 96 S. W. 277; 121 Id. 293. The verbal agreement modifying the written lease contract is not within the statute of frauds. 4 L. R. A. (N. S.), pp. 980-1, and note. Stearns v. Hall, 9 Cush. 31; 415 Wis. 38; 74 Minn. 224; 77 N. W. 34. The bill states a cause of action, and it was error to sustain the demurrer.

      WilUams & Seaweil, for appellee.
    While the authorities cited by appellant state clearly the general principles governing the adoption by a corporation of a contract originally made in advance for it by promoters, yet there are certain well-defined qualifications and exceptions which are supported by authorities. 39 So. Rep. 712; 18 N. E. 868; 112 Id. 112. See, also, 253 Fed. 340, 351; 14 C. J., § 860; 16 Arizona 485; 102 N. E. 599; 42 Okla. 440; 14 O. J., § 293 (4); 161 Fed. 874; 37 Ark. 164; 44 Id. 383; 87 S. W. 210; 37 N. E. 549. There is a radical difference between a promise made on behalf of the future corporation in the contract itself, the benefits it has accepted, and the promise in a previous contract to pay for services in procuring the latter to be made. Elliott on Private Corp., ■<§, 61; 24 S. W. 795. Before a corporation becomes bound by adoption or ratification of a contract made by promoters for it, there is a qualification that it must have been such as it could have originally made itself. 14 C. J., § 291 (2); 123 Ark. 575. It is alleged that appellee is a corporation organized and incorporated by the laws of Arizona, and its charter powers are governed by the Constitution and laws of that State. 71 Ark. 379; 96 Id. 594. Under the laws of Arizona no corporation shall issue stock except to bona fide subscribers to its stock or their assignees; nor shall issue any bond or other obligation for payment of money except for money or property received or labor done. Const. Ariz., art. 14, § 6. The rule of this court with reference to stock subscriptions is applicable. 126 Ark. 400. The contract here is against public policy. 105 N. W. 578; 148 Id. 47; 149 Id. 1156; 204 Id. 408. On the whole case the decree is right, and the demurrer was properly sustained, but, if error was committed and the complaint does state a cause of action, appellee prays leave to answer.
   Humphreys, J.

This is an appeal from a decree of the chancery court of Marion County, sustaining a demurrer to and dismissing the amended bill of appellant against the Central States Lead and Zinc Company, a foreign corporation duly organized under the laws of the State of Arizona and doing business in the State of Arkansas. The sole question for determination is whether the facts alleged in the amended bill constitute a cause of action against said corporation. The petition, in substance, alleged that A. N. Stanfield and C. H. Harrison were promoters of the Central States Lead and Zinc Company, and for its benefit secured an option contract from appellant in consideration of the payment of $500 cash and $7,500 within sixty days, wherein it was agreed, in writing, with A. N. Stanfield, for himself and his associates, that, upon payment by him, his heirs, successors or assigns, of a total sum aggregating $8,000, appellant would transfer to him, his heirs, successors or assigns, all his interest in a mining lease dated the first day of June, 1916, from the Monkey Hill Mining and Milling Company to Zimmerman Engineering Company, embracing certain lands in Marion County, with supplemental contract relating thereto, dated March 14, 1917, and alio supplemental contract modifying the terms of the original lease so as to extend the time and reduce the royalties, executed on December 24, 1917, by the said Monkey Hill Mining and Milling Company directly to him; that the Central States Lead and Zinc Company was being organized for the express purpose of taking over said leasehold contracts held by appellant; that, pending the organization, said promoters, being desirous of obtaining the immediate assignment of tbe leasehold contracts and the possession of the property to the said A. N. Stanfield for the Central States Lead and Zinc Company, verbally agreed with appellant for a modification of the option contract so as to pay him $6,000 in cash and to secure him in the payment, of the remaining $2,000 of unpaid purchase money by issuing to him a certificate of stock in the contemplated corporation for $4,000, with an express understanding on the part of said promoters to guarantee the immediate sale of said stock for $2,000 upon the completion of the organization of the said Central States Lead and Zinc Company; that, pursuant to the verbal agreement, appellant, on the 11th day of April, 1918, transferred his leasehold estate and supplemental contracts relating thereto in said property to the said A. N. Stanfield for the use and benefit of said Central States Lead and Zinc Company, and placed said A. N. Stanfield, his associates and the Central States Lead and Zinc Company in possession of said leasehold estate; that, at the time appellant transferred the mining lease and supplemental contracts aforesaid to A. N. Stanfield, said appellant, as a part of the same transaction, undertook to procure from the Monkey Hill Mining and Milling Company a new mining lease, embodying the terms and conditions of the original lease and supplemental contract thereto; that, after the organization of the Central States Lead and Zinc Company was completed, A. N. Stanfield, on the 29th day of May, 1918, transferred said leasehold estate, including the mining leases and supplemental contracts relating thereto, to the Central States Lead and Zinc Company; that, pursuant to agreement, appellant, on July 16, 1918, procured a lease embodying the terms and conditions of the original lease and supplemental contracts thereto from the Monkey Hill Mining and Milling Company directly to the said Central States Lead and Zinc Company; that, said corporation, Central States Lead and Zinc Company, through its officers and agents, accepted said transfer of said mining lease and supplemental contracts aforesaid, and mining property thereto belonging and new lease aforesaid and possession of said mining property, with fnll knowledge of the option contract wherein said A. N. Stanfield had agreed and contracted to pay $8,000 for said property, and with full knowledge of the subsequent agreement of A. N. Stanfield and C. H. Harrison to guarantee the sale of the $4,000 stock issued to appellant at and for the sum of $2,000 in cash immediately upon the completion of the organization of said corporation, so as to enable said appellant to realize the full sum of $8,000 out of the sale aforesaid; that it adopted and ratified said contract and agreement as its own by issuing its certificate of stock to him for $4,000 as security for $2,000, balance of the purchase money for the leasehold estate, and by accepting and receiving the full benefits therefrom and the possession thereof; the said A. N. Stanfield and C. H. Harrison and Central States Lead and Zinc Company, in the breach of said contract, failed and refused to place on the market and sell the $4,000 in stock, held by appellant as security for his said debt of $2,000, balance due under his contract with A. N. Stanfield upon the sale and transfer of the aforesaid property; that, on the 28th day of September, 1918, appellant attached the $4,000 certificate of stock aforesaid to a draft for $2,000 and demanded payment thereof from the said C. H. Harrison and Central States Lead and Zinc Company, but payment of said draft was refused; that appellant now tenders in court the said certificate of stock for $4,000, assigned in blank to appellee and the promoters, and to each of them, and prays judgment for the sum of $2,000 against them.

The option contract, original lease and supplemental contracts in relation thereto, the assignment thereof to A. N. Stanfield and his assignment thereof to appellee, the new lease from the Monkey Hill Mining and Milling Company directly to appellee, letters verifying the oral agreement changing the manner of payment of the purchase money for the property and the $4,000 certificate of stock attached to the draft aforesaid, were attached as exhibits to the complaint. None of these writings connected the Central States Lead and Zinc Company with the transaction except the lease made directly to it by the Monkey Hill. Mining and Milling Company, the transfer of the leases and supplemental contracts in relation thereto, the stock certificate and the reference to said corporation in the letters. The contents of the exhibits are correctly alleged in the bill, and, there being no discrepancy or conflict between them and said allegations, it is unnecessary to apply the principle in equity that the allegations. of the bill are controlled by the exhibits, as suggested by appellee. It is true the .allegations in the bill are much broader than the subject-matter covered by the exhibits, but the additional allegations in the bill were proper as tending to render appellee responsible by adoption of the contract between appellant and the promoters of appellee. The exhibits could not control or limit proper allegations relating to matters not covered by the exhibits.

The chancery court sustained the demurrer to the bill upon the theory that it alleged a personal guaranty of the sale of the $4,000' certificate of stock for $2,000 by A. N. Stanfield and C. H. Harrison, which contract of guaranty was not made for appellee corporation or with the express intention that it should become bound thereon; and upon the further theory that the contract was void under the statute of frauds as being.an attempt to hold appellee liable for the debt of said promoters on a parol contract. The allegations of the bill are of greater breadth and scope than this. They are, in substance, to the effect that the' contract was made for the corporation and would be assumed by it. The purchase price agreed upon in the option contract for the Monkey Hill leasehold was $8,000. The promoters of appellee corporation verbally agreed with appellant that, if he would forbear $2,000 of the purchase price, appellee, when organized, would issue him $4,000 of its stock to secure the payment thereof, and they would guarantee the immediate sale thereof for not less than $2,000. With a full knowledge of the contract, it thereafter accepted the assignment of the original lease and subsequent contracts in relation thereto, the possession of the property, the new and direct lease from the Monkey Hill Mining & Milling Company to it, and issued its certificate of stock for $4,000 to appellant, as security for the unpaid purchase money of $2,000. Under these allegations, the guaranty to convert the stock into money became an integral part of the contract. The allegations are that appellee adopted the entire contract, not simply a part thereof. We think the allegations of the bill bring it within the general rule of law that a corporation may adopt contracts made for it by its promoters in advance of organization as effectually as if made in the first instance by it after organization, and within the rule that corporations accepting the benefits of such contracts can not repudiate the accompanying burdens and obligations. Clark on Contracts, § 47, pp. 133, 134; R. C. L., vol. 7, §§ 6061-62; Bloom v. Home Insurance Agency, 91 Ark. 367.

We do not think the contract void under the statute of frauds, as seeking to charge appellee upon the debt of A. N. Stanfield and C. H. Harrison. The allegations are, in substance, that, as promoters for appellee corporation, they entered into a written option contract for a mining leasehold estate in Marion County for a consideration of $8,000, $500 of which was to be paid in cash and $7,500 upon delivery of the léase and leasehold estate to said appellee. Subsequently, and by verbal agreement, in order to obtain the immediate assignment of the leases and possession of the property, it was agreed that $6,000 should be paid in cash and that appellee would forbear the immediate payment of the balance of the purchase price of $2,000 upon condition that appellee, when organized, would assign $4,000 of its stock to appellant as collateral to secure the payment of the unpaid purchase money with a guaranty on the part of the promoters that the stock would be immediately sold for not less than $2,000 to pay said appellant the balance of the purchase money; that, with full knowledge of this contract, appellee, after organization, accepted the leases, possession of the property, and issued the certificate of stock for $4,000, pursuant to said understanding. Treating these allegations as true, the effect of the acceptance of the leases and property by appellee was an adoption by it of the contract in toto, including the guaranty to sell the stock for enough money to pay 'the balance on the purchase price for said property. By such adoption the contract m toto became an original undertaking on behalf of appellee and is not void under the statute of frauds as an undertaking to answer for the debt, default or miscarriage of another.

We are of opinion that the bill states a cause of action, and, for the error in sustaining the demurrer thereto and dismissing it for want of equity, the decree is reversed and the cause remanded with leave to appellee to answer, and for proceedings not inconsistent with this opinion.


author: McCulloch, C. J.

text:
    McCord v. Welch (1). Road Improvement District No. 6 v. Road Improvement District No. 8 (2).
    Opinion delivered February 14, 1921.
    1. Injunction — cloud on title. — Where a statute authorizing the county court -to- annex certain territory to a road improvement district is invalid, the owners of property within such territory have a right to enjoin proceedings in the county court to effect such annexation, as such proceedings would constitute a cloud upon their title.
    2. Pleading — conclusion op law. — In a complaint to enjoin proceedings to place plaintiff’s land in a road improvement district, an allegation that the land will not be benefited by the improvement is a mere statement of a conclusion and is not sufficient to overturn the legislative decision that such land will be benefited.
    3. Highways — remedy against unjust assessments. — Since the statute relating to highway improvement districts affords an adequate remedy to owners of property for relief against unjust assessments, the remedy thus afforded must be resorted to.

      4. Highways — legislative determination of benefits. — Although the county court determined., on the organization of a highway improvement district, that certain lands would not he benefited by being included in a certain road improvement district, this did not preclude the Legislature from determining that they would he benefited and from annexing them to the district.
    6. Constitutional law — legislative encroachment on judiciary. —Although the county court determined, on the organization of a highway improvement district, that certain lands would not be benefited by inclusion in a road district, a subsequent legislative determination to the contrary did not invade the jurisdiction of the county court, as the Legislature could disregard the court’s determination and take up the subject and determine the benefits for itself.
    6. Constitutional law — judicial proceedings. — The county court, in proceedings in regard to placing land within road improvement districts, acts in an administrative, rather than a judicial, capacity.
    7. Highways — conflicting special acts. — Where a special act placed certain territory in one district, and a later special act transferred it to a second district, the later act, to the extent of the conflict only, repeals the prior act.
    8. Highways — inclusion of territory within two improvement districts. — There is no legal objection to including land in two road improvement districts if benefits are to accrue to it from the improvements in both districts.
    Appeals from Little River Chancery Court; Jas. D. Shaver, Chancellor; McCord v. Welch reversed; District No. 6 v. District No. 8
    affirmed.

      A. D. Dulaney and John J. Dulaney, for appellants.
    1. The chancery court erred in granting the injunction to McCord, county judge, because (1) the complaint shows that court is without jurisdiction of the subject-matter. 91 Ark. 534; 7 R. C. L. 1030. .(2) The county court has exclusive original jurisdiction over matters relating to county roads with which a chancery court has no power to interfere. Article 7, § 28, Const.; 98 Ark. 64. (3) The county court is a constitutional superior court of record, while chancery courts are created by the Legislature with limited jurisdiction. Article 7, § 1, and lb., % 15. Equity has no power to restrain another superior court of record from proceeding to exercise its conceded authority in a regular, lawful manner. 95 Ark. 621. The proceedings of a court without jurisdiction are a nullity. 7 it. C. L. 1033. See, also, 54 Ark. 118; 106 Id. 508; 109 Id. 250. (4) Neither the act. 338 of 1915, nor the validating act, No. 369 of 1920, conferred jurisdiction upon the chancery court to act upon the road matters involved. 22 Oye. 879; 69 Ark. 376.
    2. The chancery court erred in overruling the demurrer of the commissioners of district No. 6 and in granting the injunction against them, because (1) the commissioners were proceeding lawfully under authority of act No. 338, Acts 1915, and the special act 369 of 1920. There is no allegation in appellee’s petition that the commissioners were acting unlawfully, capriciously, or were abusing their power or discretion. 84 Ark. 29.
    A statute validly enacted can not be repealed by the courts. Act 369 is valid and the Legislature had power to enact it. 216 S. W. 692. Validating the formation of district No. 6 made a legislative determination that appellee’s lands were benefited by the proposed road and was an exercise of legislative power which the chancery court could not set aside and could not take said added lands of appellee’s out of district No. 6, in the absence of a showing of excessive, unreasonable and exorbitant assessment of benefits. 216 S. W. 692; 218 Id. 386.
    In defining the boundaries of a road improvement district the Legislature necessarily made a determination as to what lands will and will not be benefited, and it is only in case of demonstrable mistake that the court will declare a statute void. 217 S. W. 260. A legislative determination of benefits has repeatedly been upheld. 215 S. W. 882; 213 Id. 767, 773; 133 Ark. 118. Reviewing courts should not substitute their judgments for that of assessors and commissioners unless the evidence clearly shows that the assessment and proceedings are erroneous. 213 S. W. 749; 137 Ark. 573.

      In their petition appellees allege that special act 369 was passed without their knowledge or consent and invalidates the act, but the notice required by the Constitution must be presumed to have been given. 216 S. W. 500; 218 Id. 386; 220 Id. 57; 221 Id. 465.
    3. A party seeking to enjoin a strictly legal proceeding must first submit to judgment and then proceed to enjoin the enforcement of the judgment. Appellees should have permitted the assessments to be passed on and then, in case of unfair treatment, applied to chancery for injunction. 31 Ark. 373; 21 Id. 197; 220 S. W. 38.
    4. Appellees allege no facts show comparable injury or that a multiplicity of suits would follow.
    5. Appellees had an adequate remedy at law. 106 Ark. 552; 92 Id. 118; 10 ft. C. L. 273; 29 Ark. 340; 223 S. W. 400.
    6. Section 27, act 681 of 1919, is unconstitutional and void. 218 S. W. 384; 213 Id. 762, 768. Such extensive powers can not be exercised. 118 Ark. 119; 89 Id. 513; 91 Id. 274. Section 27 is too vague and uncertain and is invalid. 220 S. W. 311; 215 S. W. 255.
    Commissioners can not so alter the boundaries of the district, routes of the roads, etc., so as to destroy the singleness or original plan of the improvement; if so, the statute is invalid. 219 S. W. 23; 213 Id. 374; 137 Ark. 355. The cost of the improvement can not exceed the benefits. 133 Ark. 491; 135 Id. 102.
    7. Section 27, act 681 of 1919, was repealed by implication by special act No. 369 of 1920. 218 S. W. 179; 123 Ark. 184; 120 Id. 530.
    8. If section 27 is valid it does not apply because appellant district No. 6 has issued bonds.
    9. If injunction is not granted appellant will suffer irreparable injury and no adequate remedy at law is available to appellant. 34 Ark. 356.

      Reynolds <$> Steel, for appeellees.
    1. The court was correct in overruling the demurrers and granting the injunction because the complaint on its face states no cause of action. Clearly appellees have shown a cause of action against both the county court and the commissioners, and have alleged that a multiplicity of suits would result if the injunction should not be granted. The law has been complied- with and no bonds have been issued. Kirby’s Digest, ■’§ 3965-6-81; 59 Ark. 344; 222 S. W. 59. Since no bonds had been issued in district 6, a levy would be illegal and injunction would lie. 30 Ark. 101-110; 32 Id. 527.
    2. The petition alleges that a petition in compliance with law has been filed with the commissioners of district No.- 8 asking for the transfer of the territory to No. 8.
    3. The demurrers admit, so far as this suit is concerned, that every statement in the petition is true.
    4. Section 27, act 681, Acts 1919, p. 2721, is valid and has not been repealed by act 369 of 1920. Section 27 is valid (109 Ark. 28; 73 Ark. 536), as it has not been expressly repealed, nor by implication, as the acts are not repugnant. 109 Ark. 28; 50 Id. 132; 72 Id. 119; 93 Id. 621; 112 Id. 102; 88 Id. 327; 36 Oye. 1077, etc. ' A general act is not usually intended to repeal a special act. 2 Ark. 119; 50 Id. 132.
    5‘. In the event the act of 1920 is valid, it and section 27, Acts of 1919, are “m pari materia,” and section 27 is valid. 4 Words and Phrases 3478; 101 Ark. 238; 76 Id. 443; 82 Id. 302; 80 Id. 411; 36 Cyc. 1077-90.
    6. The chancery court clearly had jurisdiction and the citations of appellant are not applicable. 222 S. W. 5-9. A cause of action is stated. 223 S. W. 368.
   McCulloch, C. J.

These two cases, both involving controversies between two road improvement districts in Little River County and between one of the districts and the owners of certain real property, can be disposed' of in one opinion.

Road Improvement District No. 6 is an appellant in each of the cases and was organized under - the general statutes of the State authorizing the creation of such districts for the construction of rural highways under orders of the county court (Crawford & Moses’ Digest, § 5399 et sect-, act March 30, 1915, page 1400), and was organized hy order of the county court of Little River County on May 14, 1918, to improve a public road running north from Ashdown by way of Wilton to Mills Ferry on Little River.

The General Assembly of 1919, at the regular session enacted a special statute, approved April 3, 1919 (Yol. 2, Road Acts, page 2707), creating Road Improvement District No. 8 of Little River County for the purpose of improving a certain public road running northeasterly from Ashdown. This statute is in the customary form for the creation of road districts by special statute, and it names the commissioners, describes the boundaries of the district, an'd authorizes the assessment of benefits for the construction of the described improvement.

Section 27 of that statute reads as follows:

“In case a majority in numbers of landowners, a majority in acreage, or a majority in value, of the landowners in territory adjacent to the district created by this act desire that any such adjacent territory be annexed to and become a part of the district hereby created, they may file their petition with the commissioners of the district, who shall thereupon give notice of such filing by publication for two weeks in some newspaper published and having a general circulation in Little River County fixing a date when all persons will be heard at the circuit court room in the town of Ashdown; and on said date the said commissioners shall assemble and hear all persons who desire to be heard in support of or against said petition, and if the board finds that a majority in acreage, in numbers or in assessed value has petitioned for annexation, it shall enter upon its records an order which shall have all the force of a judgment, annexing such territory to this district; and from that time forward such territory shall be treated in all respects as a part of the district created by this act; and in case said territory is located in any other road improvement district which has not issued bonds, the said territory shall cease to form a part of said other district, but for road purposes shall be exclusively apart of the district created by this act.”

Certain tracts of real estate owned severally by Welch and other .appellees in the first case mentioned in the caption of this opinion are situated in the angle formed by the two highways to be improved by the two districts mentioned, as those highways converge toward Ashdown, but the lands were not situated in either of the districts at the time they were organized. The General Assembly at the extraordinary session in February, 1920, enacted a special statute incorporating those lands into Road Improvement District No. 6 and authorizing the assessment of betterments thereon, the same ..as other lands in that district. That statute (unpublished) was approved February 26, 1920. The statute cures defects in the organization of District No. 6, and contains authority “to construct other laterals within the territory now embraced within said district or to enter into territory that may be annexed to said district if in their judgment and discretion they see fit to do so; provided, that all roads and laterals that may be built shall be upon public roads that are now or may hereafter be declared by the county court of said county to be public roads.”

Said appellees, as the owners of the aforesaid lands, in April, 1920, filed their petition in the county court pursuant to section 27 of the act of April 3, 1919, supra, to have their lands annexed to Road District No, 8. In the meantime the assessors of Road District No. 6 proceeded to assess the lands added to the district by the aforementioned special statute and filed their assessment list with the county court. Thereupon Welch and others, who were the owners of the lands annexed to District No. 6 by special statute sought to be annexed to District No. 8 by petition of the property owners, filed a complaint in the chancery court of Little River County against the county-judge and the commissioners of Road Improvement District No. 6 praying for an injunction to restrain the county judge and the commissioners from proceeding to annex the lands mentioned to District No. 6 and from assessing benefits on said lands. This action was commenced after the assessment list had been filed with the county court and before the same had been approved by the court. The chancery court overruled a demurrer to the complaint in that case, and on the refusal of the defendants therein to plead further a final decree was entered in accordance with the prayer of the complaint, and an appeal has been prosecuted from that decree.

The commissioners of Road Improvement District No. 6 also instituted an action in the chancery court against the commissioners of Road District No. 8 to restrain the latter from proceeding to annex to District No. 8 the territory referred to in the petition of the property owners. The chancery court sustained a demurrer to that complaint and dismissed the complaint for want of equity, and an appeal has also been prosecuted from that decree.

It would seem from these recitals that the real controversy between the parties relates to the question of the right of the respective districts to exercise authority over the lands of Welch and the other appellees. The first contention of counsel for appellant in their effort to secure a reversal of the decree in the case first mentioned is that the chancery court has no jurisdiction to entertain a suit to restrain the proceedings in the county court. The solution of this question depends upon whether or not the statute which attempts to annex the disputed territory to District No. 6 is'Valid, for, if the statute is void, and there is no authority to proceed under such attempted annexation, then the owners of the property in the district have the right to prevent, by injunction issued from the chancery court, such further proceedings. The proceedings, if unauthorized by law, would constitute a cloud upon the title of the owners and equity will afford relief. It will be observed that both of the districts assert authority over the disputed territory— District No. 6 claiming under the special statute approved February 26, 1920, supra, and District No. 8 claiming under section 27 of the special statute approved April 3,1919.

In the complaint in the first case it is alleged in general terms that the lands of appellees will not be benefited by the improvement constructed in District No. 6. This, however, is a mere statement of a conclusion, and is not sufficient to overturn the decision of the Legislature in enacting the special statute that such lands will be benefited by the improvement. McClelland v. Pittman, 139 Ark. 341; Cumnock v. Alexander, 139 Ark. 153; Rogers v. Arkansas-Louisiana Highway Imp. Dist., 139 Ark. 322. The statute in question affords an adequate remedy to owners of property for relief against unjust assessments, and the remedy thus afforded must be resorted to. Bush v. Delta Road District, 141 Ark. 247.

It is next contended that the special statute annexing the new territory to District No. 6 is void for the reason that there had been a previous adjudication by the county court that the lands in question would not be benefited, and that such adjudication must prevail over any determination by the Legislature in passing the statute. It is also argued in this connection that the adjudication by the county court demonstrates the mistake in the legislative finding, and that to permit this finding to be disregarded by the Legislature would constitute an invasion of the jurisdiction of the county court. We do not think that this contention is sound. The complaint contains an allegation in general terms that the county court had adjudged that these lands would not be benefited by the improvement in District No. 6. It can scarcely be said that this allegation is sufficiently definite to set forth 'the adjudication of the county court, but, conceding that it constitutes a sufficient allegation that the county court, in a proceeding authorized bv the general statute, supra, determined, upon the organization of the district, what particular lands would be benefited or determined on a petition to annex territory that these particular lands had not been benefited, we do not think that such a state of facts is sufficient to defeat the legislative will in determining that these lands will be benefited and in annexing them to the district. Such a determination by the Legislature, in spite of the former decision of the county court in the character or proceedings referred to, does not constitute an invasion of the jurisdiction of the county court, and the decision of the county court in those proceedings did not destroy the power of the Legislature to determine for itself the question of benefits and the creation of the district embracing the territory. This is so because the Legislature has original power to create local improvement districts and to determine for itself the benefits to be derived from a given improvement, and, since the Legislature possesses the power in the first instance to dispense with the action of the county court in determining benefits, it may disregard such determination by the county court and take the subject up anew and determine those benefits for itself. The county court in such proceedings does not act in a strictly judicial capacity in the ordinary sense of that term, or as used in the Constitution, but the duties thus performed are administrative. Mo. Pac. Ry. Co. v. Izard County Highway Improvement District, 143 Ark. 261, 220 S. W. 452. Therefore, the determination by the county court that there were no benefits or that the benefits were insufficient to justify the annexation of the territory to the district would not, as before stated, prevent the Legislature from taking up the subject anew and making a determination for itself.

Now, since the statute has been found to be valid, it constitutes the last expression of the legislative will in regard to the annexation of this territory to a road district. It is provided in section 27 of the act of the special statute creating Road District No. 8 that, in case of annexation of territory to that district if such' territory “is located in any other road improvement district which has not issued bonds, the said territory shall cease to form a part of said other district, but for road purposes shall he exclusively a part of the district created by this act.” The act of February 26, 1920, adding this territory to District No. 6 is necessarily in conflict with the above-quoted provision of section 27, in so 'far as it might operate on this territory, and must prevail,' since it is the last expression of the legislative will. It does not necessarily repeal that feature of section 27, so far as it gives authority to annex territory, but there is such an irreconcilable conflict between the two that it necessarily repeals that feature of the statute, so far as it withdraws the land from the operation of any other district. In other words, notwithstanding the fact that the lawmakers said in section 27 that any territory added to District No. 8 in that manner would be withdrawn from the boundaries of any other district, yet the Legislature subsequently by the enactment of the statute approved February 26, 1920, declared, in express terms, that this particular land should be added to District No. 6.

Our conclusion, therefore, is on this branch of the litigation that the statute adding the disputed territory to District No. 6 is valid and confers authority upon that district to proceed with the assessment of benefits on this land, and the chancery court erred in restraining such proceedings.

In the other case the appellants proceeded under the theory that the inclusion of the disputed territory into the boundaries of District No. 6 necessarily excluded the right of District No. 8 under section 27 of the statute creating that district, from proceeding to annex the territory. This does not follow from the conclusion that the statute annexing the territory to District No. 6 is valid. There is no legal objection to including the territory in both districts if benefits are to accrue from the improvements in each of the districts. Reitzammer v. Desha Road Improvement District, 139 Ark. 168.

The statutes under which each of these districts are operating provided for ascertainment of benefits by boards of assessors, and, as before stated, there can be no objections to including them in both districts if it be found that benefits will accrue.

It is contended by counsel for appellants that the question of the validity of section 27 falls within the decision of this court in Easley v. Patterson, 142 Ark. 52, where it was held that the provisions of the annexation of territory and construction of roads was void because no method of assessment was provided for the improvement of such roads. It will be seen from a perusal of section 27 that it merely provides for annexation of territory found to be benefited by the improvement in the district as originally provided, or by additional improvement authorized under the same statute. There is another section of the statute which authorizes the construction of laterals, but it is unimportant for us to consider that section now, as it has no bearing on the present controversy, which relates solely to the authority of District No. 8’ to annex territory found to be benefited by the improvement.

We have refrained from discussing the question whether or not appellant Road District No. 6 is in the attitude to question the authority of District No. 8 to annex territory. That question has not been raised in the case, and it is unnecessary for us to discuss it, since we reach the conclusion-that the assault upon the authority of Road District No. 8 is unfounded. The chancery court was correct in the ease in sustaining the demurrer to the complaint.

The decree is in the first case therefore reversed and the cause remanded with dirction to dismiss the complaint for want of equity. In the other case the decree is affirmed.

Wood and Hart, JJ., dissent.


text:
    Bartlett v. Willis.
    Opinion delivered February 14, 1921.
    1. Counties — registration op warrants as affecting acceptance for taxes. — Acts 1917, p. 449, providing for the registration of warrants of Johnson County by the treasurer and for their redemption by him in the order of their presentation, does not expressly or impliedly prohibit their acceptance by the collector in payment of taxes, under Crawford & Moses’ Digest, § 1993.
    2. Statutes — implied repeals. — Repeals by implication are not favored unless irreconcilable repugnance exists between the two statutes.
    Appeal from Johnson Circuit Court; A. B. Priddy, Judge;
    affirmed.

      Eeartsill Ragon, for appellant.
    The court erred in sustaining the demurrer, as act 94 of 1917 is constitutional. The act does not contravene article 16, § 10, of the Constitution. 133 Ark. 90 ; 77 Id. 250.

      Jesse Reynolds and G. O. Patterson, for appellee.
    The act, No. 94 of 1917, contravenes article 16, § 10, Constitution 1874, and the court below so held properly. The decision is sustained and supported by. 133 Ark. 90; 77 Id. 250.
   McCulloch, C. J.

Appellee is a taxpayer in Johnson County, and he instituted this action against appellant, who is the tax collector of said county, to compel the latter to accept county warrants tendered in payment of taxes levied for county purposes. Appellant refused to accept the warrants on the ground that he is prohibited from doing so by a special statute in force in that county. Acts 1917, p. 449.

Appellee contends that the statute in question is in conflict with a clause of the Constitution which provides that “taxes of counties, towns and cities shall only be payable in lawful currency of the United States, or the orders or warrants of said counties, towns and cities, respectively.” Art. 16, § 10.

This statute provides for the registration of county warrants by the treasurer “in the order of their presentation to him by the holder thereof. ’ ’ Section 5 of the statute provides that “warrants properly registered under the requirements of the act shall be redeemable in cash, or at par, by the county treasurer to the credit of the county general fund to meet the same;” and section 6 provides that “county warrants mentioned in section 5 shall be redeemable in the order of their registration, and for this purpose the county treasurer shall number said warrants consecutively in the order registered * * *.”

Our conclusion is that this statute does not expressly nor by necessary implication prohibit the acceptance of warrants in payment of county taxes, and that it is not in conflict with the general'statute which provides that collectors “shall receive county warrants in payment of county taxes.” Crawford & Moses’ Digest, § 1993. There is no irreconcilable repugnance between the two statutes, and repeals by implication are not favored, unless such repugnancy exists. The special statute now under consideration only provides the order in which county warrants are “redeemable” by the county treasurer. It says nothing about the acceptance of warrants in payment of taxes — a method of honoring warrants expressly recognized in the Constitution and expressly provided for in the general statute. Worthen v. Roots, 34 Ark. 356; Stillwell v. Jackson, 77 Ark. 250; Gould v. Davis, 133 Ark. 90.

The treasurer is the officer who receives and pays out the funds of the -county, and the word ‘ ‘ redeemable, ’ ’ as used in the statute, must be construed to refer to pay.ments of warrant by the treasurer out of the county funds in his custody. It is unnecessary, therefore, to discuss the constitutionality of the statute in any of its aspects.

Affirmed.


text:
    Walker v. Walker.
    Opinion delivered February 14, 1921.
    1. Divorce — -validity of judgment on constructive service. — In an action for divorce against a nonresident on constructive service of process, a decree for recovery of attorney’s fees and alimony is strictly personal, and the court has no power to render such decree.
    2. Divorce — alimony in gross sum. — A decree for alimony was erroneous where it awarded a gross sum, instead of a continuing allowance.
    3. Divorce — void decree — meritorious defense. — The contention that a so-called “motion for new trial” was properly overruled for the reason that a meritorious defense was not set up therein and verified by affidavit was not well taken where the personal decree for attorney’s fee and alimony was void on its face, so that an appeal could be prosecuted without moving to set aside the judgment.
    4. Appearance — taking appeal.- — A defendant who appeals from a decree for want of personal service enters his appearance in the cause for all purposes.
    Appeal from Drew Chancery Court; E. O. Hammock, Chancellor;
    reversed.

      W. A. Singfield, for appellant.
    1. The court erred in rendering a personal judgment against defendant, as he was a nonresident of the State and was only constructively summoned. He did not appear in the trial nor consent to the mode of service, and the judgment for attorney’s fees and alimony is void. 95 U. S. 714; 21 R. C. L. 1299; 42 Ark. 268; 16 L. R. A. 231.
    2. The court erred in decreeing a certain sum of money as alimony (38 Ark. 324), and in declaring it a lien on the defendant’s lands. 38 Ark. 119; lb. 477.
    3. It was error to overrule appellant’s motion for new trial. Kirby’s Digest, § 6259. The statute is mandatory.

      H. L. Veasey, for appellee.
    I. The court was correct in rendering a personal judgment against defendant for attorney’s fees and alimony. 189 S. W. 841; Kirby’s Digest, § 26i82.
    2. Tbe court having jurisdiction did not err in decreeing a certain sum as alimony.
    3. The court correctly overruled the motion for rehearing. Appellant’s motion does not comply with our statute. Kirby’s Digest, § 6520.
   McCulloch, C. J.

Appellee instituted this action in the chancery court of Drew County against appellant, her husband, to secure a decree for divorce and for a division of her husband’s property and for recovery of attorney’s fees and alimony. Appellant was not a resident of the State, and the service of process was hy publication of a warning order. The cause was heard by the court upon the complaint and the report of the attorney ad litem and upon oral testimony. The decree was in favor of appellee for dissolution of the bonds of matrimony and for the recovery of attorney’s fees in the sum of one hundred dollars and alimony in the sum of five hundred dollars. Appellant is the owner of certain real estate in the county, and the decree also awarded appellee an interest in said property to the extent of one-third, and declared a lien in favor of appellee on the remaining interest. The court appointed a commissioner to sell the remaining undivided interest of appellánt for the purpose of satisfying appellee’s lien as declared by the court.

The decree was rendered by the court and entered on June 15, 1920, and appellant made no appearance in the action until after the rendition of the decree. He appeared on July 19, 1920, and filed what is designated in the caption as a motion for new trial, in which he asked that the decree for the recovery of attorney’s fees and alimony be set aside by the court and that a retrial of the cause be granted. The court overruled the motion on September 28,1920, and an appeal has been duly proseeiited to this court.

The court erred in rendering a personal decree against appellant for -attorney’s fees and for alimony. In an action for divorce against a nonresident on constructive service of process a decree for recovery of attorney’s fees and alimony is strictly personal, and the court has no power to render such decree. A personal judgment can only be rendered upon personal service of process. Allen v. Allen, 126 Ark. 164; Black on Judgments, vol. 2, p. 933. The decree for álimony was also erroneous in awarding a gross sum, instead of a continuing allowance. Brown v. Brown, 38 Ark. 324; Shirey v. Shirey, 87 Ark. 175.

It is contended by counsel for appellee that the motion for retrial of the cause was properly overruled for the reason that a meritorious defense was not set forth in the motion and verified by affidavit. The answer to this contention is that the personal decree against appellant for attorney’s fees and alimony was void on its face, and an appeal could be prosecuted without moving to set aside the judgment. The decree for recovery of attorney’s fees and for alimony is, therefore, reversed, and the cause remanded for further proceedings not inconsistent with this opinion, the appeal to this court having the effect of entering appellant’s appearance in the cause for all purposes.


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    Bridgeman v. Augusta Cooperage Company.
    Opinion delivered February 14, 1921.
    1. Replevin — question foe juey. — In an action to recover possession of logs, the question whether the logs had been taken from plaintiff’s land by defendant, or had been taken from other land, held a question for the jury.
    2. Replevin — evidence as to value. — In an action for the unlawful taking of thirty gum sawlogs, evidence held to sustain finding as to value of logs.
    3. Replevin — judgment foe value of logs. — In an action to recover possession of logs, a judgment awarding to plaintiff the value of the logs where found, and, in addition thereto, the cost of hauling the logs to the river, was erroneous as to the additional amount where the testimony showed that, after being hauled to the river, the logs would be worth an increased amount equal to the cost of hauling it.

      4. New trial — lack op diligence. — In replevin for logs refusal to grant a new trial for newly discovered evidence as to the time when the timber was cut was proper where such issue should reasonably have been anticipated, sufficient diligence not having been shown.
    Appeal from White Circuit Court; J. M. Jackson, Judge;
    affirmed.

      Brundidge <& Neelly and G. G. McKay, for appellant.
    1. There is absolutely no testimony to show that appellee was the owner of the log's or that it was entitled to the immediate possession of same. Under the testimony giving it the most favorable consideration for appellee, there could not have been rendered a verdict for more than four of the logs at most. In replevin the plaintiff must rely on the strength of his own title, and not on the weakness of his adversary’s. There is no evidence at all, much less preponderance, in favor of plaintiff. 29 Ark. 277; 22 Id. 396; 14 Id. 141; 19 Id. 650 ; 4 Id. 94.
    2. The cause should be reversed, because the jury returned a verdict for $96 damages. No damages were shown by the testimony; the jury gave appellee judgment for all the logs were worth. The judgment as to damages is not warranted by the testimony. 25 Ark. 183.
    3. The court erred in overruling the motion for new trial, for the reason that all the witnesses for plaintiff showed that the timber cut from the land in section 29 was cut in September or October, 1919, and this fact was not known to the defendant before the trial, and that, after the cause was submitted to the jury and judgment entered, he learned from A. E. Thomas that green timber of the kind and character in controversy, and which defendant had. rafted and sold, was cut within six weeks or sixty days prior to the time of the institution of this suit and that the timber could not have been cut in September or October, 1919. Appellee wholly failed to prove title to the logs in controversy, and there was absolutely no proof of damages to the amount of $96.

      W. J. Dungan, for appellee.
    1. ■ The testimony shows that appellee was the owner of the thirty logs involved.
    2. The verdict is not excessive, and the question is raised here for the first time. No objections were offered in the court below on this account, nor was the objection embodied in the motion for new trial. 66 Ark. 460. It is immaterial how the log's were moved, whether by wagon or floated, as the jury were warranted in finding that a value had been added to the logs by reason of being assembled and floated, and plaintiff was entitled to the value of the logs in the condition when found. 44 Ark. 210.
    3. There was no error in overruling the motion for new trial, as no material new evidence was discovered, and there was no surprise. The evidence was merely cumulative and not material. 52 Ark. 120; 60 Id. 481; 73 Id. 377. If surprised, the appellant should have moved for postponement. 57 Ark. 567; 57 Id. 60; 67 Id. 47.
    4. Thomas and Clements failed utterly to identify the logs as the ones involved here.
   McCulloch, C. J.

This is an action instituted by appellee against appellant to recover possession of thirty gum saw logs alleged to be the property of'appellee and found in appellant’s possession. There was a verdict and judgment below in appellee’s favor, fixing the value of the logs at the sum of $504, and awarding damages in the sum of $96 for detention.

The principal ground urged here for reversal of the judgment is that the evidence is insufficient to sustain the verdict, in that it does not sustain appellee’s claim of ownership of the logs in controversy, and does not sustain the amount of the verdict with respect to the value of the logs and damages sustained.

Appellee owned the timber on the tract of land known as the Eetzel land and had four or five hundred logs lying loose on the land. The contention of appellee is that the logs found in appellant’s possession were taken by the latter from the Retzel land from among those owned and left there by appellee. The testimony introduced in the case tended to prove that contention to be sound. The logs were found in appellant’s possession rafted together in Grlaize creek. One of the witnesses testified that he saw appellant and another man push four logs from the Retzel land. The water was up over the land, and the logs were floating. The Retzel land was surrounded by a wire fence, and witness testified that they found the gate open and evidences of logs having been floated through the gate. They testified that they found where a log had been sawed in front of the gate, and that they followed the trail along which the logs had been floated to the point where the raft was found in Grlaize creek. The witnesses testified that they had no trouble in following the trail of the raft from the gate on the Retzel land to the place where the logs were found. They stated that they could see where the trail had been cut out through the woods so as to permit the logs to pass, and they could see evidences of the ends of the logs raking against the trees and also the pole marks where they pushed the raft. They also testified that there was no other trail that led into the trail they followed.

The logs found in appellant’s possession were of the kind which came off the Retzel land. Appellant contended that he got the logs from another tract of land from which he had a right to take the timber. There was a clean cut issue for the jury to decide, and we are of the opinion that there was abundant evidence to warrant the jury in believing that appellant wrongfully took appellee’s logs from the Retzel land and floated them along the trail or road to Grlaize Creek.

There was also evidence legally sufficient to establish the value of the logs as found by the jury. One of the witnesses testified that the logs would amount to 12,000 feet worth $42.00 per thousand at the place where they were found, and that it would cost $8.00 per thousand to haul them to the river. The jury fixed the value of the logs according to the testimony of this witness at $42.00 per thousand, making an aggregate of $504, and awarded damages in the sum of $96 which, according to the testimony, was the cost of hauling them to the river so as to get them to market.

We fail to discover any evidence in support of the claim for damages for the reason that the jury fixed the value of the timber at the place where it was- found and under the judgment appellee recovered that amount without hauling it to the river. It is true that the cost of hauling to the river would be $8 per thousand, but the testimony shows that the timber would then be worth $50, so, if we allow the verdict to stand, appellee would be awarded double compensation for the expense of hauling the timber. We are therefore of the opinion that according to the undisputed evidence this part of the judgment is erroneous.

It is also contended that the court erred in refusing to grant a new trial on the ground of newly discovered evidence relating to the time when the timber alleged to have been taken by appellee was cut. Affidavits of the witnesses who would testify were filed with the motion. Sufficient diligence was not, however, shown to justify the court in granting a new trial on account of this testimony. There is no reason why appellant could not have anticipated the issue as to when the timber was cut. This was a part of the identification of the timber which should have been reasonably anticipated, and ap-. pellant should have prepared himself for the trial by making inquiry for testimony on that issue.

If appellee will enter a remittitur within fifteen days as to the $96 awarded as damages, the judgment will be affirmed; otherwise judgment will be reversed and cause remanded for a new trial.


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    Kelley v. Stern Publishing & Novelty Company.
    Opinion, delivered February 14, 1921.
    1. Evidence — existence of coepoeation. — In an action in which defendant denied that plaintiff, was a corporation, testimony of plaintiff’s officer and manager was competent to prove plaintiff’s corporate existence, and that defendant dealt with it as such.
    2. Coepoeations — existence—evidence.—In an action in which defendant denied plaintiff’s corporate existence, testimony of plaintiff’s manager was competent to prove plaintiff was a de facto corporation and that defendant had dealt with it as such in incurring the liability on which the suit was based.
    Appeal from White Circuit Court; J. M. Jackson, Judge;
    affirmed.

      Brundidge & Neelly, for appellant.
    It was error to permit the witness, Rudinger, to testify that the Stern Publishing & Novelty Company was a corporation. The corporate existence of a corporation is a matter of record, and the best evidence must be introduced, and a certified copy of the articles of incorporation should have been introduced. 7 R. C. L. 102; 28 Ark. 263; 107 Id, 56.

      J. N. Rachels, for appellee.
    Parol evidence may be introduced to prove the existence of a corporation. 3 Enc. of Ev., p. 604; Elliott on Corp. (4 ed.) 52. Appellant dealt with appellee as a corporation, and he can not be heard now to dispute its corporate existence. 47 Ark. 281. See, also, 58 Ark. 102; 97 Id. 251; 138 Id. 267, 275. There is no law that says that the method pointed out by our statute is the only way corporate existence can be proved.
   McCulloch, C. J.

Appellee sues as a corporation organized and doing business in the State of New York, and its cause of action is based on an account for merchandise alleged to have been sold and delivered to appellant, who was engaged in the business of selling merchandise, especially military novelties; at or near Camp Pike. The answer contained a denial that appellee is a corporation as alleged in the complaint. There was a trial of the issues before a jury, and the verdict was in favor .of appellee for the full amount of the account sued on.

The only assignment of' error presented on this appeal relates to the ruling of the court in allowing parol testimony to be admitted to establish the corporate existence of appellee. The court admitted the testimony of witness Rudinger, who stated that he was one of the officers and the manager of appellee’s business, and that appellee was a corporation organized under the laws of the State of New York, and was doing business at a certain place in the city of New York. He also testified that appellee was engaged in the business of manufacturing and selling military novelties and that the bill of goods described in the account against appellant was sold to appellant and shipped to him. The witness exhibited with his testimony numerous letters which passed between appellee and appellant with respect to the sale of the goods. We are of the opinion that the testimony of witness Rudinger was competent.

We have decided in criminal cases that parol evidence of general reputation is competent, under certain circumstances, to establish the existence of a corporation. Fleener v. State, 58 Ark. 98; Brown v. State, 108 Ark. 336; Turner v. State, 109 Ark. 332.

It has 'also been held by this court that in actions by or against corporations the parties dealing with a de facto corporation are estopped to deny its legal existence. Bank of Midland v. Harris, 114 Ark. 344; Wesco Supply Co. v. Smith, 134 Ark. 23. That'view is supported by the weight of .authority, and it is held that parol evidence that a putative corporation was acting as such or was dealt with as such in a given instance was admissible. 3 Ency. of Ev. 604; 4 Elliott on Corporations, p. 52.

The testimony of witness Rudinger was sufficient to establish the fact that appellee is a de facto corporation and that appellant dealt with it as such in incurring the liability upon which the present suit is based. "We are of the opinion, therefore, that the court did not err in admitting this testimony. It was, as before-stated, sufficient to warrant the verdict of the jury.

Judgment affirmed.