text:
    Hanson v. McLeod.
    Opinion delivered May 30, 1927.
    1. Abatement and revival — effect of dissolution of corporation. —Dissolution of a domestic corporation which had failed to file reports as required ’by Crawford & Moses’ Dig., § 1715, pending action by a former employee against the corporation and its president for unpaid wages, penalty and damages for breach of employment contract, did not abate the action.
    2. Abatement and revival — effect of dissolution of corporation. —The circuit court had jurisdiction to render judgment for penalty for unpaid wages and damages against an employer corporation and its president, after dissolution of the corporation during the pendency of the action.
    3. Corporations — enforcement of judgment against corporations after dissolution. — The aid of the chancery court was properly invoked to enforce payment of a judgment rendered in the circuit court against a corporation after its dissolution.
    4. Corporations — enforcement of judgment against dissolved corporation. — Where the stockholders of a dissolved corporation took over its assets, the chancery court properly rendered judgment against them in a suit to enforce a judgment against the corporation in the circuit court.
    Appeal from Lafayette Chancery Court; J. Y. Stevens, Chancellor;
    affirmed.

      King & Whatley, for appellant.

      McKay & Smith, for appellee.
   Smith, J.

This cause was heard in the court below upon an agreed statement of facts, which contained the following recitals: Appellee McLeod filed suit on November 28, 1924, against the Hanson Lumber Company, a domestic corporation, and R. H. Hanson, the president thereof, for $138.38, unpaid wages, and $300 as penalty for failure to pay the wages, and $11,000 damages for breach of the contract under which plaintiff had been employed. At the trial of the cause plaintiff recovered judgment for $438.38, the amount of wages earned and not paid and two months’ salary at $150 per month. No part of this judgment has ever been paid.

No statement of the condition of the corporation was ever filed with the clerk of the county court of the county in which, the corporation was domiciled for either of the years 1924 or 1925, the time during which said wages were earned, as required by § 1715, C. & M. Digest.

During the pendency of the litigation above mentioned there was filed with the Secretary of State of the State of Arkansas a resolution of dissolution of said corporation, in which it was recited that the stockholders of the corporation had taken over-all its assets and had assumed all its liabilities. After the recovery of the judgment in the circuit court, plaintiff filed a complaint in the chancery court, alleging the facts above stated, and that the stockholders of the corporation had taken over the assets of the corporation, pursuant to the resolution of dissolution, and that these assets exceeded in value the debts of the corporation. There were only three stockholders of the corporation, they being the president, R. H. Hanson, and two other members of his family. Upon this record the chancery court rendered a decree in plaintiff’s favor for the amount of the judgment of the circuit court, together with costs, against the corporation and the three stockholders thereof, and this appeal is from that decree.

Appellants contend, for the reversal of the- decree of the chancery court, that, since the corporation was dissolved during the pendency of the action in the circuit court, that court had no jurisdiction to proceed to render judgment, and that the cause should have been transferred to the chancery court and the assets of the corporation there administered. It is especially insisted that the circuit court had no jurisdiction, after the dissolution of the corporation, to render judgment for the penalty for $300.

The cases of State ex rel. the Attorney General v. Arkansas Cotton Oil Co., 116 Ark. 74, 171 S. W. 1192, Ann. Cas. 1917A, 1178; St. L. I. M. & S. R. Co. v. Walsh, 86 Ark. 147, 110 S. W. 222; and Des Arc Oil Mill, Inc., v. McLeod, 141 Ark. 332, 216 S. W. 1040, are decisive of the questions presented on this ■appeal.

In the first of tliose cases it was decided that astrictly penal action did not survive against a corporation which, during the pendency of the action for the penalty, surrendered its charter, since the statutes make no provision for the payment of penalties assessed against a dissolved corporation. This case pointed out the distinction between penal and remedial actions, it being there stated that, where an action is .founded entirely upon a statute, and the only object of'the suit is to recover a penalty or forfeiture provided by the statute, it is a penal action, and does not survive the dissolution of the corporation, but that, where the damages sued for are giyen wholly to the injured party as compensation for a wrong or an injury, the statute having for its object more the indemnification of the plaintiff than the punishment of the defendant, the action is remedial, and survives the dissolution.

In the case of St. L. I. M. & S. R. Co. v. Walsh, supra, the court considered the nature of an action against a corporation for the statutory penalty for discharging an employee without paying his wages, and the court said:

“In Leep v. St. L. I. M. & S. R. Co., 58 Ark. 407, 25 S. W. 75, 23 L. R. A. 264, 41 Am. St. Rep. 109, and St. L. I. M. & S. R. Co. v. Pickett, 70 Ark. 226, 67 S. W. 870, the nature of this so-called penalty was discussed, and it was held to be damages, both exemplary and compensatory, and not a penalty, although so nominated in the statute. It is an incident to the amount due for wages, an unearned increment, as it were, and may be added to the claim for wages in determining jurisdiction.”

It appears therefore that plaintiff’s suit was not one lo recover a penalty.

The case of Des Arc Oil Mill, Inc., v. McLeod, supra, was one in which an employee sued the corporation by which he had been employed to recover damages for a personal injury, pending which suit the corporation surrendered iis charter and was dissolved.' The cause proceeded to a judgment, notwithstanding that fact, and, after the recovery of the judgment in the circuit court, suit was filed in the chancery court to subject the assets of the dissolved corporation to the payment of the judgment. It was pointed out in that case that, at the common law and in the absence of any saving statute, the dissolution of a corporation abates all actions pending against it at the time of such dissolution, and it was insisted, upon the authority of the case of State ex rel. Attorney General v. Arkansas Cotton Oil Co., supra, that the suit for damages had abated, but we held against that contention. Sections 953 and 954 Kirby’s Digest (now §§ 1819 and 1820, C. & M. Digest) were quoted, and we held that the suit, which was an action for unliquidated damages, survived. We held that it was not necessary to revive the action against any one, notwithstanding the dissolution, as it had not abated, and that the circuit court properly refused to transfer it to the chancery court, where the receivership was pending, because the statute quoted manifested no purpose to lift out of the law courts jurisdiction over pending causes of action which were properly triable at law. It was also pointed out that, when a demand had been reduced to judgment, the payment thereof must be enforced in the manner pointed out by the statute, which was through the aid of courts having equitable jurisdiction!

The proceedings in the present case conformed to the practice as there defined. The suit was not for. a penally, which abated upon the * dissolution of the corporation, and the circuit court properly retained jurisdiction to adjudicate the demand sued upon, and, when the judgment was recovered, the aid of the eliancery court was properly invoiced to enforce the payment of the judgment of'the circuit court.

The stockholders assumed the payment of the debts of the corporation when they took over its assets, and it is not questioned that the value of these assets exceeded the liabilities of the corporation. Judgment was therefore. properly rendered in the chancery court against these stockholders, as well as the corporation itself, for the amount of plaintiff’s judgment, and that decree will therefore be affirmed.


source: Caselaw Access Project

author: Smith, J.

license: Public Domain

text:
    Commercial Credit Company v. Blanks Motor Company.
    Opinion delivered May 30, 1927.
    1. Bills and notes — indorser’s guaranty op maker’s capacity.— Where the indorsee of a minor’s note which had been indorsed without recourse, demanded a guaranty of payment which was refused by the indorser, with directions to return the note if it was not satisfactory without a guaranty, the indorser was not freed from the implied guaranty under Crawford & Moses’ Dig., § 7831, that the maker had capacity to contract.
    2. Infants — validity op contract. — An infant’s contract and note for the purchase of an automobile was void and unenforceable.
    3. Bills and notes — contract with reference to negotiable instruments law. — Parties to the transfer of a note are conclusively presumed to have contracted with reference to the Negotiable Instruments Law, though neither of them may have known anything aibout the statute.
    4. Bills and notes — indorser’s liability. — In’ an action by an indorsee against the indorser of a note given by a minor, testimony that the note was indorsed without recourse, and that the indorser stated no warranty was given, is not sufficient to show that the indorser intended to absolve itself from the warranty under Crawford & Moses’ Dig., § 7831, that the maker had power to contract.
    5. Appeal and error — judgment on reversal. — Where, in an action by an indorsee against the indorser of a note of a minor, the cause was fully developed, and no valid defense was shown on reversal, judgment will be rendered on appeal against the indorsee for the unpaid balance due thereon.
    Appeal from Aslilev CirQuit Court; Turner Butler, Judge;
    reversed.

      Stfyith & Etheridr/e, for appellant.

      Compere & Compere, for appellee.
   Smith, J.

Tlie appellant, Commercial Credit Company, is a corporation domiciled at New Orleans, and is engaged in the business of buying notes from automobile dealers given in payment of second-band cars. Appellant furnishes to its customers from whom it buys notes a blank contract, .which is filled out at the time a car is sold, and attached to this contract is a promissory note, which the dealer takes for the balance of the unpaid purchase price of the car. Appellee Blanks Motor Cbmpany sold a second-hand ca.v to Oren Curtis, who was a minor only nineteen years old, for the sum of $496.15. Of this amount $148.85 was paid in cash. The balance of $347.30 was evidenced by the note of Curtis to the order of appel-lee, and was payable monthly at the rate of $28.95 per month.

The custom prevailing between appellant and appel-lee and other customers in regard to the purchase of notes was as follows: The dealer would attach' the note for the unpaid balance due on a car and the contract of sale to a draft drawn on appellant and payable in New Orleans. Appellant would pay the draft and take up the note and contract, and would then have from twenty to thirty-five days in which to determine whether it would keep or return the note. . This time was employed in investigating the responsibility of the purchaser, references being required for that purpose, and, if the report was favorable, appellant kept the note, otherwise it would return the note and the sales contract to the dealer with the draft attached for the amount paid for the note.

Curtis had made four of the monthly payments, and then defaulted and informed appellee that he would not complete the payments, whereupon appellee ■ advised appellant of that fact, and appellant sent a representative to see Curtis about the payment then past due. Curtis advised this representative that he was only nineteen years old, and did not intend to complete his payments, but would surrender the car if that was desired. The car had been so badly used that appellant’s representative refused to accept it in satisfaction of the note.

It appears that appellee’s agent who sold the car to Curtis knew, at the time of the sale, that Curtis was a minor, yet the contract of sale which Curtis signed stated his age to be twenty-one.1 Appellant did not know that Curtis was a minor when it bought the note, and was not so advised until after Curtis had declined to complete the payments on the note.

Appellee offered testimony to the effect that, after appellant had paid the draft to which the note was attached, a letter was received from appellant calling attention to the fact that answers had not been written into certain of the spaces of the sales contract, and appellee supplied the required information, and thereafter appellant wrote that it would not take the note “without recourse,” as was the custom, but would require a guaranty on appel-lee ’s part that the note would be paid.' Appellee declined to give this guaranty, and advised appellant, if it was not willing to take the note “without recourse,” to redraw for the sum paid by appellant for the note with the note and contract attached to the draft.

The exact testimony of L. W. Blanks, appellee’s managing officer, was that, “I answered them and told them that I would give them no warranty on that note, and I would not be liable on it, and i'f they did not want it on those terms, to return it to us, and redraw on us.” The testimony on appellant’s part was that no guaranty of payment had been asked, and none was refused, but we must assume, in view of the verdict returned in appel-lee’s favor, that the testimony in its behalf was credited by the jury.

The note in question was indorsed as follows: “For value received, pay to the order of Commercial Credit Company, Inc., New Orleans, La., without recourse,” signed, “Blanks Motor Company, by L. W. Blanks.”

The general contract under which appellant bought notes from appellee gave it a reasonable time — which was shown to be from twenty to thirty-five days — in which- to determine whether it would keep any particular note, after paying the draft covering the amount of the "note, and appellant had the right, if it elected, after investigation, not to keep the note, but to return it with draft attached, and the court so instructed the jury, but, over appellant’s, objection, the court also instructed the jury .as follows: “If you should believe from the greater weight of the testimony that, within said time (reasonable time for investigation), the plaintiff refused to accept the note with the assignment of defendant ‘without recourse’ but wrote demanding guaranty of the collection by defendant, and tliat defendant refused to guaranty said collection, but requested tlie return of said note and contract, and offered to repay the plaintiff the amount of the draft he had drawn and collected, then this abrogated and put to an end the contract between-the parties (plaintiff and- defendant), and the defendant would not be bound on his indorsement, although the original maker, Curtis, was a minor at the time of his signing the note, and your verdict should be for the defendant. ’ ’

We think, under the facts stated, that the instruction was erroneous. We assume that appellant demanded a guaranty of payment, and that appellee refused to give this guaranty, and directed appellant to return the note if it was not willing to keep it without a guaranty, but we think there was nothing in this correspondence which-operated to free appellee from a liability as indorser which was not dependent upon the existence of a special contract of guaranty. In electing not to return the note, but to keep it without payment being guaranteed, appellant took the note with such rights — -and those only — -as the law gave it. What are those rights?

As Curtis was a minor, the contract and note for the purchase of the automobile was void and unenforceable. Arkansas Reo Motor Co. v. Goodlett, 163 Ark. 35, 258 S. W. 975. But appellant was an innocent purc-haser of the note. The express and affirmative representation had been made in the contract of sale, to which the note was attached, that Curtis was twenty-one years of age, and there is no contention that appellant was advised to the contrary until Curtis defaulted in his payments.

The note was indorsed “without recourse” by appel-lee, and negotiated with this indorsement by delivery to appellant, and, this being true, § 7831, C. & M. Digest, fixes the rights and obligations of the parties thereto. This section reads as follows:

“Every person negotiating an instrument by delivery or by a qualified indorsement, warrants: (1). That the instrument is genuine and in all respects what it purports to be; (2) That he has a good title to it; (3) That all prior parties had capacity to contract; (4) That he has no knowledge of any fact which would impair the validity of the instrument or render it valueless. But when the negotiation is by delivery only, the warranty extends in favor of no holder other than, the immediate transferee. The provisions of subdivision 3 of this section do not apply to persons negotiating public or corporation securities, other than bills and notes.”

There was nothing in the refusal of appellee to guarantee the payment of the note which operated to prevent this section of the statute from applying to the transaction between the parties. One who negotiates a note by delivery, or by a qualified indorsement, warrants that the maker has the capacity to contract. Appellee did this because the négotiable instruments law so provides, and the parties are conclusively presumed to have contracted with reference to this law, although neither of them may have known anything about the statute. There was no contract that the statute should not apply. Appellee did refuse to assume any responsibility for the payment of the note, but this is a very different matter from refusing to warrant that the maker of the note had the capacity to make it.

Appellant took title to the note by delivery under a qualified indorsement, and the law imputed into the transaction the warranty that the maker of the note had' the capacity to make it, and the .refusal of appellee to guaranty its payment was insufficient to discharge it from a liability to which its refusal did not relate.

.We find it unnecessary to determine whether parol testimony is admissible to prove what effect the parties intended by the indorsement “without recourse,” as the testimony offered is not sufficient to show that the indorser intended to absolve itself from the effect which the statute quoted gives to an indorsement of that character. Smith v. Barner, 188 Pac. 216, 95 Ore. 486.

The court erred therefore in giving the instruction set out above, and the judgment must therefore be reversed, and, as the canse appears to have been fully developed, and no valid defense has been shown, judgment will be rendered here against appellee for the unpaid balance due on the note.


author: Meharry, J.

text:
    Knights of Pythias of North America v. Sanders.
    Opinion delivered May 30, 1927.
    . Insurance — bight to declare forfeiture of policy. — A fraternal benefit society, organized under Crawford & Moses’ Dig., § 6072, could not declare a forfeiture of a member’s policy for failure to pay dues, when it owed the member sick benefits in amount in excess of his dues.
    Appeal from Sebastian Circuit Court, Port Smith District; John E. Tatum, Judge;
    affirmed.

      Thomas J. Price, for appellant.
   Meharry, J.

The appellee, plaintiff below, brought this suit in the circuit court of Sebastian County, alleging that the appellant, defendant below, was a fraternal benefit society, organized and carried on solely for the mutual benefit of its members, and had a lodge system and representative form of government, and which made provision for the payment of beneficiaries in accordance with § 6072 of Crawford &'Moses’ Digest; that she was the widow of Will Sanders, who died July 18, 1924. It was alleged that, more than three years prior to his death, Will Sanders was a member of appellant association, and that there was issued to him its endowment policy by whiph it agreed to pay $300 to his widow. It was alleged that Will Sanders, at the time of his death, was in good standing with the grand.and subordinate lodges; that proof of death was furnished, and that defendant lodge refused to pay.

The defendant answered, admitting that Sanders was at one time a member of the lodge and that a certificate was issued and delivered to him, but it denied that he was entitled to recover, because it alleged that he liad not paid liis quarterly premiums of $2.25 for the April period.

The undisputed proof shows that Will Sanders did not pay his dues in April, 1924, and that he died in July, 1924. The policy expressly provides that the beneficiary would not he entitled to recover unless the member was in good standing at the time he died. The undisputed proof, however, also shows that, while his dues were $2.25, the lodge owed him $24 for sick benefits. There is no dispute about this. And the only issue in the case is whether, under the circumstances above set out, the defendant had a right to forfeit his policy.

This court has hold that payment of dues is a condition precedent to recovery. The plaintiff in the case swore positively that Will Sanders, the deceased member, was in good standing at the time of his death, and no member of the local lodge was called to testify with reference to that. This court has held that, where the insurance company had funds in its hands belonging to the member which were equal to, or in excess of, the amount of the dues, it could not declare a forfeiture. After citing many authorities, the court said:

“But, in our opinion, the difference in facts does not destroy the application or lessen the efficacy of the principle. It is true that, in some of them, there was a contract, custom, or course of dealing, but, because insurance 'companies enter upon contracts' or establish a usage in conformity to the doctrine above announced, from which they have not been allowed to deviate, does not prove the unsoundness of the doctrine itself, but rather the contrary. The doctrine does not arise out of the peculiarities of any particular case. It does not depend upon contract, custom or course of dealing for its existence and potency. It has its origin in that fundamental principle of justice -which will compel one who has funds in his hands belonging to another which may be used, to use such funds, if at all, for the benefit dhd not to the injury of the owner. For his consent to the one and dissent to the other will he presumed.” Union Central Life Ins. Co. v. Caldwell, 68 Ark. 505, 58 S. W. 355.

The court in the above case quoted 'syltla approval the following language from Judge Cooper in Smith v. Ins. Co., 44 Ohio St. 170:

“•I am of the opinion that the company was bound, upon the plainest principle of equity, to apply the dividend first in such manner as to save, the forfeiture. The usage of the company in deducting the dividends from the principal in cases where the insured elects to continue the policy, even if uniform and unvarying, cannot control where the insured ceases to pay and the contract is silent as to what should be done with the dividend. The law, which tempers justice with mercy, makes the proper application. The dividend, as the property of the insured, should be applied to what he is bound to pay— the interest. ’ ’

And we think, in this case, that the law will make the proper application. The amount of funds in the hands of the company at the time Sanders died was very much in excess of his dues. The testimony showed that it was not collected, probably because Sanders.did not need it at the time, and thought the insurance company did.

“.Subject to the exceptions hereinafter noted, the rule may be laid down broadly that an insurance company has no right to declare a policy of insurance forfeited for the nonpayment of the premiums, assessments or dues when, at the time, the company is in any way indebted to the policy-holder, either for dividends declared or other funds which it may have in its hands belonging to the insured.” 14 R. C. L. 966. For other authorities see ease-note in 22 L. R. A. N. S.] 304. See also 32 C. J. 1308.

In this case it would be unjust for the company to declare a forfeiture when it had funds in its hands belonging to him greatly in excess of his dues. The circuit court correctly directed a verdict for the plaintiff, and the judgment is therefore affirmed.


author: Mbhapfy, J.

text:
    St. Francis Valley Lumber Company v. Orcutt.
    Opinion delivered May 30, 1927.
    1. Master and servant — salary op employee. — An employee, claiming that he was entitled to a percentage of the profits of a corporation, is not entitled to recover where the evidence fails to show that any profits had been made by the corporation- during the period of his employment.
    2. Master and servant — evidence op contract. — Where an employee, in a suit against the master for non-payment of a portion of his salary, claimed that his salary was to be the same as the salary of another employee, it was admissible to show the contract of employment of such co-employee.
    3. Appeal and error — errors not mentioned in motion por new TRIAL. — Alleged errors of the trial court in admitting or rejecting testimony over objection will not 'be considered on appeal, where they were not mentioned in the motion for new trial.
    4. Limitation op actions — items op account. — Refusal to instruct that items of debit and credit in an account, incurred more than three years prior to suit, were barred, was error where the accounts were not mutual, open and current.
    5. Limitation of actions — mutual account. — A mutual account is such as shows that each of the parties has a claim against the other.
    6. Trial — 'Question of pact por jury. — Wherever there is a conflict of testimony on any question of fact, the question is for the. jury.
    Appeal from Clay Circuit Court, Eastern District;’ W. W. Bcmdy, Judge;
    reversed.

      Bloch -& Kirsch and Arthur Sneed, for appellant.
   Mbhapfy, J.

The appellee, who was plaintiff below, brought suit in the Clay Circuit Court, alleging, among other things, that appellant, who was defendant below, was indebted to him in the sum of $4,080.30, for services as general manager and chief bookkeeper for said corporation; that in the month of September, 1919, he engaged his services to said defendants to take charge of their business at Piggott, Arkansas. That he took charge and devoted his entire time thereto for five years and nine months at $250 per month. That during that time he was paid certain sums from time to time, and that, after making all deductions, left a balance of $4,080.30, for which amount he brought this -suit. He filed with his complaint the following statement of account:

“Statement of account between F. J. Orcutt and St. Francis Valley Lumber Company and T. A. Foley.'
“To service 5 yrs. 9 mos. $250 per mo. $17,250.00
Cash Nov. 5, ’19..$ 559.00
Cash Dec. 31, ’20.. 1,000.99
Cash June 30, ’21. 1,046.67
Cash Dec. 31, ’21... 1,062.20
Cash June 30, ’20.. 961.91
Cash June 30, ’22. 1,300.87
Cash Dec. 31, ’22. 1,281.59
Cash June 30, ’23. 1,393.77
Cash Dec. 31, ’23. 1,312.70
Cash June 30, ’24. 1,300.00
Cash Dec. 31, ’24.:._ 1,300.00
Cash Mar. 21, ’25. 550.00
Total .$13,169.70 $17,250.00
“Balance due F. J. Orcutt..$4,080.30
“State of Illinois, County of Edgar.
“I,., sheriff of Edgar County, State of Illinois, do solemnly swear that I have this.day of September, 1925, duly served the within copy of complaint, with summons annexed thereto, on the within named defendant, T. A. Foley, by delivering a true copy thereof to such defendant on the.*.day of September, 1925, and that such service and delivery of said copy, with summons annexed, was made upon the defendant, T. A. Foley, in the city of Paris, County of Edgar, .and State of Illinois.
“And I further swear that the defendant, T. A. Foley, is personally well known to me.
“Sheriff, Edgar County, Illinois.”
“State of Illinois, County of Edgar.
“I,.:., notary public within and for the county and State aforesaid, do hereby certify that personally appeared before me., sheriff of Edgar County, State of Illinois, the above-named affiant, whom I certify to be personally well known to me, to be worthy of credit, and made oath that the matters and things set forth in the foregoing affidavit are true.”

The defendant filed answer and cross-complaint. The answer admitted the employment of plaintiff, but alleged that the salary was fixed at $100 a month, and he had been paid in full and overpaid, and asked for judgment against the plaintiff in the sum of $3,696.61.

The testimony of the plaintiff tended to show that he entered into an agreement with president of the defendant, but that nothing was said about his salary or compensation, that is, no amount was fixed, but that he came on down to Piggott a'hcl finally took charge, and that a brother of the president came down also and showed him a contract that he, the brother, had for $250 a month, and that he stated that plaintiff’s salary would be the same. Plaintiff’s testimony tended to show that the amount of his salary for the entire time was $17,250 and that he had been paid $13,169.70.

The testimony of both the president of the corporation and his brother contradicts-the testimony of plaintiff, and tends to show that his salary was to be $100 a month and a percentage of the profits.

.There are two reasons why it appears unnecessary to go into that feature of the case. First, that the $5,000 stock which plaintiff claimed he was to have the earnings from was never delivered to him, and he never paid anything on it. And second, that it seemed very doubtful if any profits at all were made during the period.

There are a number of questions raised by appellant, and one is that, the court erred in permitting the plaintiff to testify as to the contract which the defendant had with Fred Foley, the brother- of the president of the company. Of course Fred Foley’s contract would not be evidence in this case at all, but it seems that the only purpose of its introduction was to show the amount of salary of Fred Foley, and this was competent only on the theory that plaintiff testified that he was to have the same amount that Fred Foley was to have. This letter could not be considered for any other purpose, but we think that portion of it was competent for this purpose.' The plaintiff testified that he entered the employ of the defendant with the understanding and agreement that he was to have the same salary that Fred Foley was receiving, and it therefore became necessary to prove what that salary was.

There was some objection to other testimony, but it is unnecessary to discuss this, because the motion for a new trial does not mention any error of the court in admitting or rejecting testimony.

Appellant urges that the court erred in its refusal to give instruction number 4, which rea,ds as follows:

“You are instructed tha.t all items of debits or credits shown in the accounts of either of the parties, prior to- September 3,1922, are barred, and neither can recover against the other. ’ ’

The court refused to give this instruction, and.in this we think the court erred. That instruction told the jury that any item in the account or any charge in the account made more than three years prior to the beginning of the suit was barred by the statute of limitations, and this would be true unless plaintiff had based his suit on a mutual open account current. #

In the case of McNeil v. Garland, this court stated:

“But it is claimed by appellees that this was a • mutual running account of such a nature as comes within the rule that items within three years draw after them other items beyond that period.”

This we think is erroneous. To constitute such an account there must be a mutual credit founded on a sub-áis ting debt on the other side or an expressed or implied agreement for a set-off of mutual debts. Angelí on Lim. 138, and authorities there cited. A natural equity arises when there are mutual credits between the parties or when there is an understanding that mutual debts shall be a satisfaction or set-off pro tanto between the parties. The only thing upon which appellees can claim that their account was.a mutual open account current was the fact of payment of $50 by the appellant. But it has been well settled that, when payments have been made by one party for which credits are given by the other, it is an account without reciprocity and only upon one side. McNeil v. Garland, 27 Ark. 343.

“Where the items in an account are all charged against the one party and in favor of the other, as herein, it is not a mutual account. It lacks the very essential to make it such — mutuality.” Fitzpatrick v. Henry, Admr., 16 N. W. 606, 58 Wis. 250.

“To constitute mutual accounts there must be mutual demands. Each party must have a demand or right of action against the other.' The exception in the statute of limitations in favor of mutual accounts has no application when th'e demand is altogether on one side, although payments on account have been made. ’ ’ McArthur v. McCoy, 112 N. W. 155, 21. S. D. 314.

“On the other hand, mutual accounts arise where each party has rendered services or sold articles of property to the other with the expressed or implied understanding that their respective claims shall,' upon settlement, be offset to the extent of the smaller claim. * * * The more usual definition of mutual accounts is a reciprocity of dealing, charges, and credits on both sides, each party having a cause of action against the other.” Lapham v. K. & T. Oil, Gas & Pipe Line Co., 123 Pac. 863, 87 Kan. 65, Ann. Cas. 19131), 813.

“A charge on one side and mere payments on the '.other do not constitute a mutual account.” Peck v. N. Y. & Liverpool United States Mail S. S. Co., 18 N. Y. Sup. Ct. 226.

The authorities are'practically unanimous, so far as we have been able to find, in holding that a mutual account must be sucli ns shows that each has a claim against the other. And where one performs services for another and payments are made from time to time, as was done in this case, there is no mutual account. There could he no recovery in this case for any charge made more than three years prior to the bringing of the suit. All charges made prior to that time are barred by the statute of limitations.

Since we hold that the court erred in refusing to give instruction No. 4 requested by the appellant, it necessarily follows that instructions given in conflict with No. 4 are erroneous and should not have been given. We deem it unnecessary to discuss the evidence or the other instructions.

It is also urged by the appellant that the plaintiff was estopped by his own conduct, and that therefore there ought to have been a verdict directed for the defendant. There is some conflict in the testimony on this question and some evidence tending to explain the reason, but this does not seem to be very fully developed, and wherever there is a conflict of testimony on any question of fact, it is proper to submit the question to the jury.

For the error in refusing to give instruction No. 4 the judgment is reversed, and the case is remanded for a new trial.


author: McHaNey, J.

text:
    Frizzell v. Lowe.
    Opinion delivered May 30, 1927.
    1. Taxation — validity op tax forfeiture. — The State Land Commissioner cannot convey good title to land based on a tax for-ieiture where the taxes were assessed in a county adjoining’ thát in which the land was situated.
    2. Injunction — cutting timber — title-of plaintiff. — In a suit to enjoin a removal of timber which involved the ownership of land, the plaintiff must recover on the strength of her own title, and not on the weakness of the title .of her adversaries. *
    3. Public lands — title to unsurveyed island. — Title to an unsur-veyed island held not to pass to the State under a patent of April 16, 1865, though it was included within lha boundaries oi' such patent, where the patent conveyed “according' to the official plats of surveys.”
    4. Public lands — eight to question patents. — The patent to public land issued by the General Land Office, not void on its face, cannot be questioned directly or collaterally by persons who do not show themselves to be in privity with a common or paramount source of title.
    5. Water and watercourses — island in non-navigable stream.— The ownership of land opposite an island in Little Missouri River,, which is a non-navigable stream, carries with it riparian rights to the thread of the stream, including an island.
    Appeal from Ouachita Chancery Court, Second Division ; George M. LeCroy, Chancellor;
    affirmed.

      McMillan & McMillan, for appellant.

      George W. Hays and Oscar Winn, for appellee.

      JIarry E. Meek, amicus curiae.

   McHaNey, J.

This suit involves the ownership of 86.32 acres of land known as “Hurt’s Island” in the Little Missouri River, in Ouachita County, Arkansas. The Little Missouri River at this point is the boundary line-between Ouachita and Clark counties. At the point where the river strikes the island it is divided into two streams, the one to the north side of the island being the larger and main body of the river, in which is the middle or thread of the stream. This island has distinct shore lines with well defined banks emerging out of the stream ’to the level of or even higher than the upland on either side of the stream. It is covered with valuable timber, and it may be said that this island has been there in the same condition as at the present time for many years, such a length of time that the memory of men still living run-neth not to the contrary.

On April 16, 1855, the Federal Government executed and delivered to the State of Arkansas a swamp land patent, conveying “the whole of fractional section 9” and other lands “containing in the aggregate 68,375.77 acres, according to the official .plats of survey of said land returned to the General Land Office by the Surveyor General.” Fractional section 9 is located in township 11 south, rango 18 west. Hurt’s Island is wholly within the exterior boundaries, of fractional section 9, lying in.the north one-half of said section,- near the center thereof, a part being in the northeast and a part in the .northwest quarter of said section. The survey of fractional section 9 and other lands contained in this swamp land patent was made in 1837-38, and it appears that Hurt’s Island was not surveyed. The plat shows the meander lines of both banks and both channels of Little Missouri River surrounding this island, and the quarter section lines on the plat of the survey run only to the brink of the river both north and south of the island, but not across the river, nor across said island. It was designated on the plat by the engineers as “Hurt’s Id.” In 1917 the Government caused an actual survey to be made of Hurt’s Island, and on July 13, 1922, on the assumption that the swamp land patent had not conveyed said island to the State of Arkansas, the Department of the Interior patented said island to the appellee, Martha H. Lowe. The State had never attempted to convey this island until the year 1920, when a swamp land deed was issued to E. L. Huddleston,- but the State Land Commissioner thereafter determined that the state had no title to the island, canceled the deed to Huddleston and caused the purchase price to be refunded to him. This island was placed upon the taxbooks of Clark County for the' year 1920; the taxes not being paid, same was forfeited to the State, and appellants claim title to the island by virtue of deed from the State Land Commissioner, based on 'this forfeiture, dated Sept. 18, 1925.

Appellee brought this suit October 15, 1925, against appellants, setting up her title from the Government and the payment of taxes on this island since the date of the patent, to enjoin the appellants from cutting and removing the timber from the island, on which issue was joined, and the court, after hearing the testimony, decreed the title to the island in appellee, enjoined appellants from cutting and removing the timber therefrom, and can-celecl the tas. deed under which appellants claimed. From this decree this appeal is prosecuted..

Appellant has correctly stated that the only question in this case is, “Did the swamp land patent executed by the U. S. Government on April 16, 1855, convey to the State of Arkansas the tract of land involved in this suit ? ’ ’ If it did, then the Government had nothing to convey at the time it issued the subsequent patent to appellee. If it did not, then the title remained in the Government, which passed to appellee by the patent of July 13, 1922.

It may be stated at the outset that the tax forfeiture above mentioned is void, and that appellants acquired no title by virtue of their deed from the State, either by limitation or otherwise, based thereon. The land, being in Ouachita County, could not be assessed for taxes in Clark County, and it may be further said that the appel-lee, having brought this action for affirmative relief, must recover, if at all, upon the strength of her own title, rather than the weakness of that of her adversaries.

We are of the opinion that the above question must be answered in the negative, that is, that the title to Hurt’s Island did not pass to-the State under the swamp land patent of 1855. We think it clear that the language of the patent, “the whole of fractional section 9, * * * according to the official plats of survey of said lands returned to the General Land Office by the Surveyor General,” conveyed only such land in fractional section 9 as liad been surveyed. In the case of Champman & Dewey Lbr. Co. v. St. Francis Levee Dist., 100 Ark. 94, 139 S. W. 625, the U. S. Government patented to the State of Arkansas a tract described in the patent as follows: ‘ ‘ Township 12 north of range 7 east. The whole of the township (except section 16), containing 13,615 acres and 67-100 of an acre, * * * according to the official plats of survey of said lands returned to the General Land Office by the Surveyor General.” There was a large area of unsurveyed land within the exterior limits of this township, that was either low, marshy or covered with water, and was meandered on the official plat or map, and was designated thereon as “sunk lands.” And in the course of. its opinion this court said:

“The outside boundaries of the entire township are fixed, and the lands marked ‘sunk lands’ upon the plat are within such fixed boundaries, and shown to be so, and are clearly designated by reason of the meander line dividing the unsectionized sunk lands from the surveyed and platted lands. ”

It will be seen from the language used here that the appellants in this case are following the theories announced by the court in.that case. But this decision of our court was reversed by the Supreme Court of the United States, and will be found in 232 U. S. 186, 34 S. Ot. 297, 58 L. ed. 564, and in commenting upon this same question the Supreme Court of the United States used this language:

“Of course, the words in the patent, ‘the whole of the township (except section 16) ’, are comprehensive, but théy are only one element in the description, and must be read in the light of the others. The explanatory words, ‘according to the official plats of survey of said lands, returned to the General Land Office by the Surveyor General’, constitute another element, and a very important-one, for it is a familiar rule that, where lands are patented according to such a plat, the notes, lines, landmarks, and other particulars appearing thereon become as much a part of the patent, and are as much to be considered in determining what it is intended to include, as if they were set forth in the patent.”

It appears to us that this construction of the Supreme Court of the United States of the conveyance in that case is controlling here. Of course, a very much larger body of land was under consideration, but it seems to us that the principles there announced are controlling here.

Again, in the case of Little v. Williams, 88 Ark. 37, 113 S. W. 340, the court, in the opinion on rehearing, defined the word “township,” as used in a stipulation of facts, as follows:

“Therefore, giving the word ‘township,’ used in the stipulation of facts, the meaning which we must attribute to the parties who employed the term, it has reference to the township surveyed and platted by the Government surveyors, and means the townships according to the surveys and plats. A conveyance of the township ‘according to plat of surveys’ does not include lands which do not appear on the plat of the surveys.”

Again, it is perfectly manifest that Hurt’s Island had never been surveyed, from the fact that the Department required a survey thereof in 1917. If it had already been surveyed, we can see no necessity for having a resurvey. And prior to the year 1920, the State apparently had never claimed any title to this island by virtue of its swamp land grant, as in that year it sold the island to one Huddleston, and thereafter canceled the sale and refunded the money, on the opinion of the State Land Commissioner that the State had no title. This was public land, and appellee’s patent is'valid on its face.

In 22 R. C. L., page 309, it is said:

“A patent to public land issued by the General Land Office, and not void on its face, cannot be questioned, either directly or collaterally, by persons who do not show themselves to be in privity with a common or para' mount source of title.”

It is true that the Little Missouri River is a non-navigable stream, and that the ownership of the land opposite the island carries with it the riparian rights to the thread of the stream, which would'no doubt include any ordinary island to be expected in a stream of this size, but appellants are not the owners of the land on either side of the stream opposite Hurt’s Island, and are in no position to raise the question of. riparian rights or to invoke the law applicable to such questions.

It follows from what we have said that the decree is right, and must be affirmed. It is so ordered.


text:
    Central Clay Drainage District v. Hunter.
    Opinion delivered May 30, 1927.
    Limitation op actions — defense Raised by demurrer when. — A question of the statute of limitations cannot be raised by demurrer in a law action, unless the complaint shows on its face that the action is barred and the non-existence of any ground of avoidance.
    Limitation of actions — written contract. — Where the services in question were rendered a written contract to which the statute of limitation of finding has applied, the plea of statute was unavailing, where the services were rendered within such period.
    Frauds, statute of- — sufficiency of written memorandum.— The written minutes of the meeting of board of directors of a drainage district setting out the employment of an attorney and the terms of compensation, accepted and performed by the attorney and acted under by the boards for twelve years, from year to year, was a sufficient memorandum signed by the party to be charged, under the statute of frauds.
    Evidences — best evidence of contract of employment. — In an attorney’s action to recover for services, the minute book of the board of directors of the drainage district, containing a contract stating the terms of employment, was the best evidence, and could not be impeached or varied by a witness.
    Appeal and error — discretion as to amending pleadings. — The right to amend pleadings during the course of the trial setting up new defenses rests in the sound discretion of the court, and its action will not be reversed on appeal, in the ahsence of a manifest abuse of such discretion.
    Appeal from Clay Circuit Court, Eastern District; W. W. Bandy, Judge;
    affirmed.

      Ward & Ward and-I?. B. Holifield, for appellant.

      Hunter & Hunter and W. E. Spence, for appellee.
   McHaNey, J.

From June 5, 1911, to 1923, appellee, Judge L. Hunter, was in the employ of appellant as its attorney on an annual retainer of $200 and expenses, and, in the event the business of appellant should take him outside Clay County, he was to receive additional compensation for his services. This agreement was entered into between, the parties June 5, 1911, but was not so expressed in the minutes of appellant until the meeting of the .board of directors of appellant on'June 2, 1913, where the following appears:

“C. M. B. Cox called attention to the fact that the minutes of the meeting of June 5, 1911, at which time he and L. Hunter were employed as attorneys, did not set out the agreement then entered into, whereupon, on motion of J. L. Bartlett, it was ordered that the said agreement then entered into between the board of directors of the Central Clay Drainage District and C. Ml B. Cox and L. Hunter, attorneys, be here set out. It was agreed at the said meeting of June the 5, 1911, that each of said attorneys should receive for their services the sum of two hundred dollars per year (and necessary expenses) [words in parentheses are inserted with ink.] But it was further agreed that, in the event said attorney should be called upon to attend to matters outside the county of Clay, they should receive extra compensation. ’ ’

These minutes are in the regular minute-book of appellant, and a copy thereof was attached to the complaint, and the minute-book was exhibited in evidence by the secretary. Appellee, with the other officers of' appellant, were thereafter regularly elected every two years, or annually, as it appears latterly. In 1921 and 1922 he was directed by appellant to look after certain litigation with the Inter-River Drainage District, which took him on two trips to St..Louis, .Missouri, with litigation in the Federal District Court; two trips to Poplar Bluff, Missouri, and examination of records of Inter-River Drainage District; two trips to Little Rock, in case in Federal District Court; and two trips to Cape Girardeau, Missouri, for all of which he claimed a fee of $1,050. Appellant refused to pay for this extra service, and appellee brought suit therefor on September 29,1925. Other items were claimed in the complaint, but it was agreed at the trial that they were barred by limitations. The case was tried to a jury, which resulted in a verdict and judgment against appellant for $713.63-, with interest at six per cent, from May 1, 1922, from which comes this appeal.

Appellant assigns eight errors of the trial court for a reversal of this case. Wo will not discuss them in detail, as many of them refer to the same subject-matter, and will be disposed of together, especially those assignments relating to the written -contract of employment, heretofore set ont. There was no error in overruling appellant’s demurrer, either general or specific. Apparently it is sought to raise the question of the statute of limitations by demurrer. This cannot be done in an action at law, unless the complaint shows on its face that the action is barred and the non-existence of any ground of avoidance. McCollum v. Neimeyer, 142 Ark. 471, 219 S. W. 746; Flanagan v. Ray, 149 Ark. 411, 232 S. W. 600; Brown v. Ark. Power & Light Co., ante p.— 294 -S. W. 709. The complaint stated a good cause of action on a valid contract, to which only the five-year statute of limitations is applicable, and as it is undisputed in the evidence that appellee was employed during all these years, from 1911 to 1923, under the same contract, the plea of the statute cannot avail appellant anything, since it is likewise undisputed that the services were rendered within the statutory bar. The written minute of the meeting is a sufficient written memorandum signed by the party to be charged, appellant, which was accepted and performed by appellee, and both parties have continued to recognize it and be bound by it for a period of twelve years, from year to year, and appellant cannot now be heard to say that it is not the written evidence of the contract, or that it was conceived in iniquity or born of sin and fraud, as intimated; and, if fraudulent, it must be that of the officers of appellant alone, for it is not shown that the minute-book has ever been out of their possession.

In the case of McDermott v. Mahoney, 139 Iowa 298, 115 N. W. 35, 116 N. W. 788, the court said:

“ Where a written agreement signed by one party is accepted and adopted by the other and acted upon, it becomes their contract in the same sense as though both parties had signed it. ’ ’

We cannot ‘therefore appreciate the force of the contention that the record or minute book was incompetent. The book was identified by the secretary and the former secretary as the minute-book of appellant. The book was the best evidence, and was properly admitted, and it could not be impeached or the written contract varied by the witness, Bartlett.

Neither was it error for the court to refuse an offer to amend the answer so as to set up a new defense that would impeach the record. The right to amend pleadings during the course of the trial, setting up new defenses, rests in the sound discretion of the court, and its action will not be reversed on appeal unless there is a manifest abuse of such discretion. St. L. I. M. & S. R. Co. v. Cooper & Ross, 120 Ark. 595, 180 S. W. 203.

Other assignments relate to the giving and refusal of instructions. We do not deem it necessary to set them out and comment on them at length, as it would unduly extend this opinion. Suffice it to say that we have examined these assignments carefully, and find no reversible error. The judgment is accordingly affirmed.


author: Hart, C. J.

text:
    Hill v. State.
    Opinion delivered June 6, 1927.
    1. Intoxicating liquors — sufficiency of evidence. — Evidence held to sustain a conviction of selling intoxicating liquors.
    2. • Witnesses — impeachment of defendant as witness. — In a prosecution for selling intoxicating liquor, it was not error to permit the State to prove by cross-examining defendant that he had been convicted of illegally manufacturing intoxicating* liquor, where he was permitted to say that he was innocent, and thejury was instructed that such cross-examination only went to defendant’s credibility as a witness.
    3. Criminal law — unsupported assignment of error.' — On appeal from a conviction of selling liquor, an assignment of error that the indictment was for the same offense as was charged in another indictment against defendant in the same court, will not be considered on appeal, if the record does* not show that such assignment was true.

      Appeal from Clark Circuit Court; James H. McCol-lum, Judge;
    affirmed.

      P. L. Smith, for appellant.

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

Jesse Hill prosecutes this appeal to reverse a judgment of conviction against him for selling intoxicating liquors in violation of our statute.

Two witnesses testified for the State. According to the testimony 'of one of them, he gave the defendant $15 for a gallon and one-half of whiskey, called “old white mule,” in Clark County, Arkansas, in July, 1926. Another witness for the State testified that, in 1926, he bought a quart of intoxicating liquor from the defendant at his home in Clark County, Arkansas, and gave him two dollars for it. It is true that the defendant adduced evidence at the trial tending to show that he did not sell any intoxicating liquor at any time or place, hut the jury was the judge of the credibility of the witnesses, and the evidence for the State, if believed by the jury, was legally sufficient to warrant the jury in returning a verdict of guilty. Corley v. State, 162 Ark. 178, 257 S. W. 750.

The next assignment of error is that the court erred in allowing the State to ask and prove by the defendant, on his cross-examination, that he had been convicted of illegally manufacturing intoxicating liquors. The defendant was permitted to say that, although convicted, he was innocent; and the court told the jury that his cross-examination in this respect could only be considered by them as affecting the credibility of the defendant as a witness. There was no error in the action and ruling of the court. Canada v. State, 169 Ark. 221, 275 S. W. 327.

The next assignment of error is that the court erred in overruling defendant’s motion to quash the indictment. The motion alleges that the indictment in the case at bar was for the same offense as charged in another indictment against the defendant in the same court. The record does not contain anything to show whether or not this is true, and, in the absence of such showing, we cannot consider this assignment of error. If a judgment could be reversed upon mere allegations of error in motions made, without proof to sustain them in the record, no judgment could escape reversal if the defendant or his counsel had ingenuity enough to prepare and file motions the allegations of which, if true, would he grounds for reversal.

We find no reversible error in the record, and the judgment will therefore be affirmed.


author: Wood, J.

text:
    Lybrand v. Wafford (1). Pioneer Construction Company v. Madison County (2)
    Opinion delivered June 6, 1927.
    1. Constitutional law — effect of adopting amendment. — The constitutional amendment adopted October 5, 1926 (Acts 1927, p. 1210), prohibiting the issuance of bonds by cities or counties, except to pay indebtedness existing at the time of the adoption of the Constitution of 1874, held not to repeal the bond-issuing clause of the constitutional amendment adopted October 7, 1924 (Acts 1925, p. 1086), authorizing bonds to pay indebtedness of counties and cities and towns outstanding at adoption of such amendment.
    2. Constitutional law — construction 'of constitutions1. — A constitution as a whole is to be examined with a view to arriving at the true intention of each part; and if any section be intricate, obscure or doubtful, the proper mode of discovering its true meaning is by comparing it with the other sections and finding the sense of one clause by the words or obvious intent of another, so that effeet'may be given, if possible, to the whole instrument.
    3. Constitutional law — construction in light of conditions.— Constitutions, like statutes, are properly to be construed in the light of conditions existing at the time of adoption and the general spirit of the times and the prevailing sentiments among people.
    4. Constitutional law — effect of latest amendment. — In construing a constitution and amendment thereto, the last amendment adopted must control and all tlie provisions of tlie constitution and the prior amendments thereto which are in necessary and irreconcilable conflict must yield.
    5. Constitutional law — repeal by implication. — Repeal by implication of a provision of a constitution is not looked on with favor, and is never allowed except where there is such invincible repugnancy between the former and latter provisions that both cannot stand together.
    6. Constitutional law — unintelligible words. — Where a word or phrase in a constitution would make the clause in which it occurs unintelligible, the word or phrase may be eliminated and the clause read without it.
    7. Constitutional law — reenactment op provision op constitution. — A later constitutional amendment, which is merely a reenactment of a provision of the constitution, does not repeal an intermediate amendment which qualifies or limits the original constitution, but such intermediate amendment will be deemed to remain in force and to qualify or modify the new amendment in . the same manner as it did the original constitution.
    8. Constitutional law — provisions relating to debts op municipal corporations. — The provisions of the Constitution of 1874 and all amendments thereto relating to debts of municipal corporations must be considered in pari materia as constituting the whole body of law on that subject. • .
    9. Constitutional law — effect op reenactment op constitutional provision. — 'So far as a section of the Constitution is changed by amendment, it receives new operation, but, so far as it is not changed, mere nominal reenactment should not disturb the whole body of statutes, in pari materia passed since the first enactment.
    10. Constitutional law — effect op second amendment. — Where a provision of the Constitution is amended, an intermediate amendment, inconsistent with the new matter made by the second amendment, will toe repealed.
    11. Mandamus — issuance op bonds to pay county indebtedness.— The county cannot be compelled by mandamus to issue interest-bearing certificates or bonds to pay indebtedness existing at the time of adoption of Constitutional Amendment No. 11, adopted October 7, 1924 (Acts 1925," p. 1086), which provided that counties may issue such certificates for existing indebtedness, since it is only where the statute imposes positive, instead of discretionary, power that the wood “may” will be construed as obligatory.
    (1) Appeal from Grant Circuit Court; Thomas E. Toler, Judge;
    reversed.

      John L. McClellan and T. Nathan Nall, for appellant.

      W. L. Baugh, Jr., for appellee.
    (2) Appeal from Madison Circuit Court; J. 8. Maples, Judge;
    affirmed.

      Duty & Duty, for appellant.

      Carl V. Stewart, for appellee.

      Mehaffy & Miller, amici curiae.

      Reed, Daugherty, Iloyt & Washburn and Robinson, House & Moses, amici curiae:

   Wood, J.

By these appeals we are asked to answer the following question: Did the constitutional amendment adopted October 5, 1926, as Amendment No. 15, repeal the bond-is'suing- clause of the constitutional amendment adopted October 7, 1924, as Amendment No. 11? (These constitutional amendments will hereafter for convenience be referred to as Amendments No. 11 and No. 15, respectively, regardless of the numbers that may be given them when they are digested' in the Constitution) .

Amendment No. 11 is, in part, as follows:

“ Section 1. That § 4 of article 12 of the Constitution of the State of Arkansas be amended by adding thereto the following: ‘The fiscal affairs of counties, cities and incorporated towns shall be conducted on a sound financial basis’.”

The language of the first section then prescribes the method by which counties, cities and incorporated towns shall be conducted on a sound financial basis, and the section further contains the following:

“Provided, however, to secure funds to pay indebtedness outstanding at the time of the adoption of this amendment, counties, cities and incorporated towns may issue interest-bearing certificates of indebtedness or bonds with interest coupons for the payment of which a county or city tax in addition to that now authorized, not exceeding three mills, may be levied for the time as provided by law until such indebtedness is paid.”

Section 2 repeals all provisions in conflict.

Amendment No. 15 is as follows:

“That § 1 of article 10 of the Constitution of the State of Arkansas he amended to read as follows : ‘Article 10, § 1: Neither the State nor any city, county, town or other .municipality in this State shall ever lend its credit for any purpose whatever; nor shall any county, city, town or municipality ever issue any interest-bearing evidences of indebtedness, except such bonds as may be authorized by law to provide'for and secure the payment of the indebtedness existing at the time of the adoption of the Constitution of 1874, and the State shall never issue any interest-bearing- treasury warrants or scrip.’ Provided, that cities of the first and second class may issue, by and with the consent of a majority of the qualified electors of said municipality voting on the question at an election held for the purpose, bonds in sums and for the purposes approved by such majority at such election as follows:
“For the payment of any indebtedness existing at the time of the adoption of this amendment; for the purchase of rights-of-way for construction of public streets, alleys and boulevards within the corporate limits of such municipality; for the construction . of, widening or straightening of streets, alleys and boulevards within the corporate limits of such municipality; for the purchase, development and improvement of public parks and flying-fields located either within or without the corporate limits of such municipality; for the construction of sewers and comfort stations; for the purchase of firefighting apparatus and fire-alarm systems; for the purchase of street-cleaning apparatus; for the purchase of sites for, construction of, and equipment of city halls, auditoriums, prisons, libraries, hospitals,. public abattoirs, incinerators or garbage disposal plants; for buildings for the housing of fire-fighting apparatus; for the construction of viaducts and bridges; and for the purpose of purchasing, extending, improving, enlarging, building, or construction of waterworks or light plants, and distributing- systems therefor. * * *

There is no express repeal of any oilier provision of the Constitution,‘in Amendment 15.

It Avill be observed that, under the language of Amendment No. 11, above' quoted, counties, cities and incorporated towns, in order to secure funds to pay indebtedness existing at the time of the adoption of the amendment, are authorized to issue interest-bearing certificates of indebtedness or bonds, while the language of Amendment No. 15 is: “Nor shall any county, city, town or municipality ever issue any interest-bearing evidences of indebtedness except such bonds as may be authorized by law to provide for and secure the payment of the indebtedness existing at the time of the adoption of the Constitution of 1874.” There being no express provision in the language of Amendment No. 15 repealing the bond-issuing provision of Amendment No. 11, the question therefore is whether or not the language of the bond-issuing provision of Amendment No. 15 repeals the bond-issuing provision of Amendment No. 11 by necessary implication.

In State v. Martin, 60 Ark. 343, 348, 30 S. W. 421, 422 (28 L. R. A. 153), we said:

“We must keep to the front certain familiar but unvarying rules when we come to interpret the provisions of any section of a constitution. (1). Unambiguous words need no interpretation. (2) Where construction is necessary, words must be given their obvious and natural meaning. (3) The words or provisions under consideration must be construed with reference- to every other provision, so as to preserve harmony in the whole instrument. (4) The intent of the framers, gathered from both the letter and spirit of the instrument, is the law.”

Judge Cooley says: “The object of construction, as applied to a written constitution, is to give effect to the intent of the people adopting it. In the case of all written laws, it is the intent of the lawgiver that is to be enforced. But this intent is to be found in the instrument itself. It is to be presumed that language has been employed with sufficient precision to convey it, and, unless examination demonstrates that the presumption does not hold good in the particular case, nothing will remain except to enforce it.”

He further says: “Whether we are considering an agreement between parties, a statute, or a constitution, with a view to its interpretation, the thing which we are to seek is the thought which it expresses. To ascertain this, the first resort in all cases is to the natural signification of the words employed, in the order of grammatical arrangement in which the framers of the instrument have placed them. If, thus regarded, the words embody a definite meaning, which involves no absurdity and nó contradiction beUoeen different parts of the same writing, then that meaning, apparent on the face of the instrument, is the one which alone we are at liberty to say was intended to be conveyed. In such a case_ there is no room for construction. That which the words declare is the meaning of the instrument, and neither courts nor legislatures have a right to add to or take away from that meaning.

“Nor is it lightly to be inferred that any portion of a written law is so ambiguous as to require extrinsic aid in its construction. Every such instrument is adopted as a whole, and a clause which, standing by itself, might seem of doubtful import, may yet be made plain by conv-parison with other clauses or portions of the same law. Tt is therefore a very proper rule of construction, that the whole is to be examined with a view to arriving at the I rue intention of each part. * * * If any section of a law be intricate, obscure, or doubtful, the proper mode of discovering its true meaning is by comparing it with tite other sections, and finding out the sense of one clause by the words or obvious intent of another. And in making this comparison it is not to be supposed that any words have been employed without occasion, or without intent that they should have effect as part of the law. The rule applicable here is that effect is to be given, if possible, to the whole instrument, and to every section and clause. If different portions seem to conflict, tlie courts must harmonize them, if practicable, and must lean in favor of a construction which will render every word operative, rather than-one which may make some words idle and nugatory.

“This rule is applicable with special force to written constitutions, in which the people will be presumed to have expressed themselves in careful and measured terms, corresponding with the immense importance of the powers delegated, leaving as little as possible to implication. It is scarcely conceivable that a case can arise where a court would be" justified in declaring any portion of a written constitution nugatory because of ambiguity. One part may qualify another so as to restrict its operation, or apply it otherwise than the natural construction would require if it stood by itself; but one part is not to be allowed to defeat another if, by any reasonable ^construction, the two can be made to stand together. Every provision should be construed, where possible, to give effect lo every other provision. Upon the adoption of an amendment to a constitution the amendment becomes a part thereof, as much so as if it had been originally incorporated in the constitution, and it is to be construed accordingly. If possible, it must be harmonized with all the other provisions of the constitution. If this cannot be done, the amendment will prevail.” 1 Cooley, page 124, Constitutional Limitations. Numerous cases are cited in noté to text.

There is another familiar rule which should be stated here. “It is settled by very high authority that, in placing a construction on a constitution, or any clause or part thereof, a court should look to the history of the times, and examine the state of things existing when the constitution was framed and adopted, in order to ascertain the old law, the mischief and the remedy. Constitutions, like statutes, are properly to be expounded in the light of conditions existing at the time of their adoption and the general spirit of the times and the prevailing sentiments among the people.” 6 R. C. L. § 46, p. 51. Numerous cases are cited to support the text.

Another rule, about which there is no conflict in the authorities in the construction of a constitution and amendments thereto, is that the last amendment to a constitution adopted by the people must control, and all the provisions of the constitution and the prior amendments thereto which are in necessary and irreconcilable conflict with the last expression of the popular will must yield and the last amendment adopted be allowed to stand.

Still another rule which must be considered is that a repeal by implication of a provision of a constitution, like the repeal of a statute by implication, is not looked upon with favor and is never allowed by. the courts, except where there is such an invincible repugnancy between the former and the later provisions that both cannot stand together and be a part of the organic law.

Another rule is that, where a word or phrase in a statute would make the clause in which it occurs unintelligible, the word or phrase may be eliminated and the clause read without it.

Still another rule is that a later law'which is merely a reenactment of a former does not repeal an intermediate act which qualifies or' limits the first one, but such intermediate act will be deemed to remain in force and to qualify or modify the new act in the same manner that it did the first..

The above rules have been announced by text-writers and adjudicated cases, and most of them have often found expression by our own court, according to the particular facts calling for their application. See, in addition to the above text from Cooley and R. C. L. and the authorities there cited, Encllich on the Interpretation of Statutes, §§ 27 and 28; 2 Lewis’ Sutherland Statutory Construction, § 284, page 739;"Black on Interpretation of Laws, §§ 39, 40; also some of our own cases, as State v. Scott, 9 Ark. 270; State v. Watts, 23 Ark. 304; Hawkins v. Filkins, 24 Ark. 286; State v. Martin, supra; Hartford Fire Ins. Co. v. State, 76 Ark. 303, 89 S. W. 42; Carpenter v. Little Rock, 101 Ark. 238, 142 S. W. 162; Martels v. Wyss, 123 Ark. 184, 184 S. W. 845; Morris v. Raymond, 142 Ark. 450-501, 201 S. W. 116; Bank of Blytheville v. State, 148 Ark. 504, 230 S. W. 550; Matheny v. Independ ence County, 169 Ark. 925, 277 S. W. 22; Babb v. El Dorado, 170 Ark. 10, 278 S. W. 649; Combs v. Gray, 170 Ark. 936, 281 S. W. 918.

The provisions of the Constitution of 1874 and all the amendments thereto relating to the debts of municipal corporations, counties, cities and towns must be considered in pari materia as constituting the whole body of the law on that subject. Article 12, § 4, of the original. Constitution is as follows

“No municipal corporation shall be authorized to pass any law contrary to the general laws of the State; nor levy-any tax on real or personal property to a greater extent, in one year, than five mills on the dollar of the assessed value of the same. Provided that, to pay indebtedness existing at the time of the adoption of this Constitution, an additional tax of not more than five mills on the dollar may be levied.”

Article 16, § 1, is as follows:

“Neither the State nor any city, county, town or other municipality in this State shall ever loan its credit for any purpose whatever; nor shall any county, city, town or municipality ever issue any interest:bearing evidences of indebtedness, '(a) except such bonds as may be authorized by law to provide for and secure the payment of the present existing indebtedness, and'the State shall never issue any interest-bearing Treasury warrants or scrip.”

The adoption of Amendment No. 11 added all of its provisions to § 4 of article 12 of the Constitution and repealed the provisions of the Constitution in conflict therewith. By the adoption of Amendment No. 15 the provisions of § 1, article 16, were readopted in the precise language of that section down to tlie words, “present existing indebtedness.” Instead of these words in § 1, lart. 16, of the original Constitution, the words in Amendment No. 15 are “indebtedness existing* at the time of the adoption of the Constitution of 1874.” After repeating verbatim the language of § 1, article 16, except as above set forth, Amendment No. 15 provides that cities of the first and second class may issue bonds for the various purposes therein specified, the first purpose mentioned being for the payment of any indebtedness existing at the time of the adoption of this amendment. Then follows an enumeration of the various public improvements for which cities of the first and second class may issue bonds.

Now, keeping in mind the applicable rules of construction as above set forth, let us see if there is any irreconcilable conflict between Amendment No. 11 and Amendment No. 15 of the Constitution. The history of the times shows that, when Amendment No. 11 was adopted, many, if not all, the counties, cities, and towns of the State were heavily in debt. In order to enable them to pay off their indebtedness existing at the time of the adoption of Amendment No. 11 and thus to get on a cash basis, they were authorized to issue bonds; and, in order to keep them on a cash basis, they were prohibited from incurring any future obligations in any fiscal year which exceeded the revenue for such year. This was the purpose of Amendment No. 11, as declared in Kirk v. High, 169 Ark. 152, 273 S. W. 389, 41 A. L. R. 782; Babb v. El Dorado, supra; Nelson v. Walker, 170 Ark. 170, 279 S. W. 11; also McGregor v. Miller, 173 Ark. 459, 297 S. W. 30; see also Independence County v. Lester, 173 Ark. 796, 293 S. W. 743.

What, then, was the intention of the draftsman who formulated the language in which Amendment No. 15 was couched and in which it was initiated, submitted to, and adopted by the people, and what was the intention of the people in adopting the same? Of course, the people intended to adopt the amendment as it was written. We are convinced that it was the intention of the draftsman of Amendment No. 15- to copy in the first paragraph thereof all of § 1, article 16, of the Constitution of 1874. • Doubtless such intention was in his mind when he copied literally the language of § 1, article 16, of' the Constitution down to the words “present existing indebtedness,” then, through inadvertence, or mere clerical oversight, instead of using the words “present existing indebtedness,” he used the words, “indebtedness existing at the time of the adoption of the Constitution of 1874.” This change in the language was Wholly immaterial, because, in the sense they were, obviously intended to be used, the expression “present existing indebtedness” and the expression “indebtedness existing at the time of the adoption of the Constitution of 1874” mean precisely the same thing; for the “present existing- indebtedness” at the time these words were used in § 1, article 16, of the Constitution, was. “indebtedness existing at the time of the adoption of the Constitution of 1874. ’ ’ These were synonymous expressions, and indeed blit convertible terms. If the words “indebtedness existing at the time of the adoption of the Constitution of 1874” should be construed to mean that it was the intention of the people in adopting Amendment No. 15 to prohibit counties, cities, towns or municipalities from issuing any interest-bearing evidences of indebtedness except “indebtedness eooisting at the time of the adoption of the Constitution of 1874, then the first paragraph of the amendment in which this language is used would be wholly inconsistent with the provisions in the second paragraph, to wit: “that cities of the first and second class may issue” bonds “for the payment of any indebtedness existing at the time of the adoption of this amendment.” In the first paragraph the words “city, town or municipality” certainly include cities of the first and second class mentioned in the second paragraph.

It is the duty of the court, under one of the rules of construction above mentioned, to give some meaning, if possible, to all tlie words used in Amendment No. 15, and to interpret tlxe separate words as well as the language of the amendment as a whole, so as to make its varied provisions harmonize, if possible, and to arrive at the intention of the electorate in adopting the amendment. As we have said, the phrase, “indebtedness existing at the time of the adoption of the Constitution of 1874,” was intended to mean precisely the same as if the phrase were the “present existing indebtedness,” it being, the manifest intention not to change § 1, article 16, of the Constitution of 1874, except to amend the same by adding thereto the provisions contained in the second paragraph of the amendment.

“It is the duty of the courts,” says Mr. Black, “to give effect, if possible, to every word of the written law. But, if a word or clause be found in a statute which appears to have been inserted through inadvertence or mistake, and which is incapable of any sensible meaning, or which is repugnant to. the rest of the act and .tends to nullify it, and if the statute is complete and sensible without it, such word or clause may be rejected as surplusage. ’ And, on the other hand, as this distinguished author says, “Words may be interpolated in a statute, or silently understood as incorporated in it, . where the meaning of the Legislature is plain and unmistakable, and such supplying of words is necessary to carry out that meaning and make the statute sensible and effective.” Black on Interpretation of Laws, §§ 39 and 40.

Section 23 of article 5 of the Constitution provides that “no law shall be revived or amended, or the provisions thereof extended,, or conferred by reference to its title only; but so much thereof as is revived, amended, extended or conferred, shall be reenacted and published at length.” What we have said above in regard to the rules of construction and interpretation applies equally to constitutions and statutes. See 12 Cor. Jur. 699, and cases cited in note, among them Hodges v. Dowdy, 104 Ark. 583, 140 S. W. 656; see also Babb v. El Dorado, supra.

Our conclusion therefore Is that the electorate, in adopting Amendment No. 15, intended by the first paragraph thereof to amend § 1, article 16, of the Constitution of 1874 by readopting the same in language meaning precisely the same thing’ as § 1, article 16, and then intended to add thereto the provisions contained in the second paragraph. Since therefore the first paragraph of Amendment No. 15 merely adopts the constitutional form of amending § 1, article 16, of the Constitution by reenacting or adopting that section, and then adding thereto the changes contained in the proviso of the second paragraph, we must apply to the first paragraph of Amendment No. 15 the well-established canon of construction referred to above and expressed by Mr. Sutherland as follows:

“The constitutional provision requiring amendments to be made by setting’.out the whole section as amended was not intended to make any different rale-as to the effect of such amendments. So far as the section is changed it must receive a new operation, but so far as it is not changed it would be dangerous to hold that the mere nominal reenactment should have the effect of disturbing the ivhole body of statutes in. pari materia which had been passed since the first enactment. There must be something in the nature of the neto legislation to show such an intent with reasonable clearness before an implied repeal can be recognised.” 1 Lewis’ Sutherland Statutory Construction, vol. 1, % 237, page 441; see also 36 Cye. 1084.

Under this rule of construction the words, “indebtedness existing at the time of the adoption of the Constitution of 1874” cannot be held to repeal Amendment No. 11, permitting counties, cities and incorporated towns to issue interest-bearing certificates of indebtedness or bonds to pay their indebtedness outstanding at the time of the adoption of Amendment No. 11. Section 1, art. 16, of the Constitution is the original law on the subject of allowing counties, cities and towns to pay their indebtedness. Amendment No. 11 is an intermediate law on that subject, qualifying the original; and the first paragraph of Amendment No. 15 is merely a reenactment of § 1, article 16, of the Constitution, and the first original law on that subject.

In Ellsworth Dist. v. Tyler County Court, 87 S. E. 870, 77 W. Va. 523, it is held:

“Generally, where a later law is merely a reenactment of the former, it will not be regarded as repealing the intermediate act, which qualified and limited it, but the intermediate act will be deemed to remain in force, qualifying or modifying the new act as it did the first.”

In Gordon v. People, 7 N. W. 69, 44 Mich. 485, Judge Campbell, speaking for a unanimous court, of which Judge Cooley at the time was a member, says:

‘ ‘ The constitutional provision requiring amendments to be made by setting out the whole section as amended was not intended to make any different rule as to the effect of any such amendments.. So far as the section is changed it must receive a new operation, but so far as it is not changed it would be dangerous to hold that the merely nominal reenactment should have the effect of disturbing the whole body of statutes in pari materia which had been passed since its first enactment.”

This rule has been announced and applied in, many adjudicated cases. State ex rel. v. Clausen, 199 Pac. 752, 116 Wash. 432; Monocal v. Heise, 94 N. E. 232, 49 Ind. App. 302; State ex rel. Taggart v. Kansas City, 111 Pac. 493, 83 Kans. 431; Hall v. Dunn, 97 Pac. 811, 25 L. R. A. (N. S.) 193, 52 Ore. 475; Powell v. King, 80 N. W. 850, 78 Minn. 83; Collins Coal Co. v. Hadley, 38 Ind. App. 637, 75 N. E. 832; Cooperative Savings & Loan Assn. v. Fawick, 11 S. D. 589, 79 N. W. 847; Hill v. Village of Aurora, 196 N. W. 465, 156 Minn. 469; Powell v. King, 80 N. W. 850, 78 Minn. 83, 271; Nelson v. Itasca County, 155 N. W. 752, 131 Minn. 478; Gaston v. Merriam, 22 N. W. 614, 33 Minn. 271; Gaughn v. State, 118 N. E. 565, 187 Ind. 334; Leach v. Exchange State Bank, 203 N. W. 31, 200 Iowa 185; Hill v. Village of Aurora, 196 N. W. 465, 157 Minn. 469; Bentley v. Allen, 66 N. W. 505, 92 Wis. 386; Olson v. Haritwen, 57 Fed. (C. C. A.) 845; Small v. Lutz, 67 Pac. 421, 41 Ore. 570, 69 P. 825.

To be sure, the last rule of construction above mentioned is subject to the exception or limitation as stated by Mr. Sutherland on Statutory Construction, § 273, page 524, as follows:

“"Where.a law is amended and reenacted as amended, any intermediate law inconsistent with the "new matter introduced or change made by the amendment will be repealed. ’ ’

See also Leach v. Exchange State Bank, supra, page 35.

Now7, when the provisions of article 4, § 12, of the Constitution as amended by Amendment No. 11, and § 1, article 16, as amended by Amendment No. 15, are considered and construed in the light of all the above rules, we are thoroughly convinced that there is no inconsistency between the bond-issriing provisions of Amendment No. 11 and Amendment No. 15. On the contrary, the provisions of our Constitution with the amendments thereto on this subject, Nos. 11 and 15, constitute a consistent and harmonious whole. It seems to us that this is the inevitable conclusion, in view of the contemporaneous history of the adoption of these amendments. Man}7 of the counties, cities and towns of the State, as already stated, were overwhelmed with debts, the payment of which and the putting of these municipalities on a cash basis and keeping them so, furnished the motive for the adoption of Amendment No. 11; then, to enable cities of the first and second class to pay their existing indebtedness and to make the municipal improvements mentioned therein necessary to their progress and prosperity, furnished the motive for the adoption of Amendment No. 15. Such, undoubtedly -was the intention of the people in the adoption of these amendments to the Constitution. But, if the phrase indebtedness existing at the time of the adoption of the Constitution of 1874,” could be construed to mean that it was the purpose of this amendment to prohibit the payment of indebtedness of counties, cities and towns, except that existing at the time of the adoption of the Constitution of 1874, then such construction would strike down Amendment No. 11 and destroy the purpose of the people in adopting that amendment. Such an interpretation of the phrase mentioned would render the same meaning-less, lead to an absurdity, and be wholly at variance with the intention of the electorate in adopting these amendments, which intention, if it can be discovered, is the law. We believe we have discovered that intention, assisted as we have been by the excellent briefs of counsel. We therefore answer the question propounded in the'beginning of the opinion in the negative by holding that Amendment No. 15 does not repeal Amendment No. 11 and that both must be retained as a part of the organic law of our State.

The' above conclusion makes it necessary ^ to determine whether or not counties, cities and incorporated towns may be compelled by mandamus to issue interest-bearing certificates or bonds to pay their indebtedness existing at the time of the adoption of the amendment.

An enabling act to put the provisions of Amendment No. 11 into effect was passed by the Grenefal Assembly of the State of Arkansas approved March 23, 1925. In United States ex rel. Stayton v. Paschal, 9 Fed. Rep., 2d Series, page 109, Judge Trieber, in an opinion handed down on December 2, .1925, said: “So the only question to be determined is, does Amendment No. 11 to the Constitution of the State and the enabling act of March 23, 1925, entitle the relator to have interest-bearing bonds' issued and paid by the county in order to satisfy his judgment?” The court denied the petition for mandamus in that case, and, after an exhaustive review of the authorities, among other things said: “It is only when the statute imposes a positive instead of a discretionary power that ‘may’ will he construed as ‘must’.” The court then cited and quoted from Farmers’ Bank v. Federal Reserve Bank, 262 U. S. 662, 43 S. Ct., 651, 67 L. ed. 1157, 30 A. L. R. 635, as follows: “It is true that in statutes the word ‘may’ is sometimes construed as ‘shall.’ 'But that is where the context or the subject-matter compels such construction. ”

We consider the reasoning of Judge Trieber in that case as absolutely unanswerable. He cites to sustain the propositions of law announced and the conclusion reached by him numerous authorities, and his exhaustive and able review of the same makes it unnecessary for us to say more than that we follow this opinion as being a correct interpretation of Amendment No. 11 and the enabling act to make the same effective.

It follows that the judgment of the G-rant Circuit Court in the case of J. W. Lybrand, Jr., County Judge of Grant County, v. W. F. Wafford, is reversed, and the cause will be remanded, with directions to the circuit court to enter a judgment affirming the order and judgment of the Grant County Court in the matter of funding the indebtedness of Grant County existing at the time of the adoption of Amendment No. 11, and to certify its judgment to- the county court. It likewise follows that the judgment of the Madison Circuit Court dismissing the petition of the appellant, Pioneer Construction Company, for a writ of mandamus to compel the county judge of Madison County to issue bonds to pay the judgment of the petitioner against that county, is correct. The judgment in that cáse is therefore affirmed.


text:
    Northcutt v. North Arkansas Highway Improvement District No. 2.
    Opinion delivered June 6, 1927.
    1. Highways — improvement district — suit for delinquent taxes. —In a .suit by a highway improvement district to enforce collection of taxes delinquent for 1926, where notice of delinquency was properly given under Acts 1917, p. 2205, § 26, a demurrer to the answer of the landowners in the district, alleging that the highway commissioners were without authority to sue for 1926 taxes until they had first sued to enforce the payment of prior delinquent taxes, held properly sustained.
    2. Highways — delinquent taxes — excuse for non-payment.— Where Acts 1917, p. 2205, § 26, imposed the duty on highway commissioners to sue to enforce the payment of delinquent taxes for a highway improvement, the fact that other landowners had defaulted in the payment of the taxes for a prior year does not excuse the refusal of the defendants to pay for a subsequent year.
    3. Highways — suit for delinquent taxes — defense. — In a suit by a commissioner of a highway improvement district to collect taxes delinquent for 1926, a demurrer was properly sustained to the answer of landowners alleging that the commissioners were unauthorized to sue because they had not first sued to enforce payment of prior delinquent taxes, where there was no showing that the total proceeds of suits to enforce payment of all delinquent taxes will not be required to discharge outstanding obligations of the district.
    4. Highways — duty of commissioners. — Under Acts 1927, No. 11, § 3, and No. 112, § 6, highway improvement districts are required to collect all taxes delinquent prior to January 1, 1927, and the State to pay only such bonds or interest thereon as matures thereafter.
    Appeal from Fulton Chancery Court; Alvin S. Irby, Chancellor;
    affirmed.

      Oscar E. Ellis and H. A. Northcidt, for appella'nt.

      L. F. Reeder, L. B. Poindexter and S. M. Oasey, for appellee.
   Smith, J.

Suit was filed November 24, 1926, by the North Arkansas Highway Improvement District No. 2 to enforce the collection of the delinquent 1926 road taxes due on certain lands in the district in Fulton County. Notice of the delinquency was given in the manner and form provided by § 26 of act 473 of the Acts of 1917 (volume 2, Acts 1917, page 2181), this being the act under which the district was organized.

Appellants, who are the owners of lands in the district, filed a demurrer to the complaint of the improvement district, which was overruled. They thereupon filed an answer in which they alleged that the taxes or revenues arising from the collection of the taxes for the year 1926 or any prior years could only be used by the commissioners of the district for the purpose of paying installments of bonds and interest thereon maturing against said district, and that, by virtue of the provisions of act No. 11 of the Acts of 1927, the State of Arkansas had taken over and assumed the payment of all due and past due installments of bonds and interest thereon due by the district, and there was therefore no necessity for the collection of further taxes.

It was also alleged that the commissioners had failed to institute suit to enforce the payment of the delinquent taxes for the years 1923 and 1924, amounting to $3,464.68, and it is insisted that the commissioners are without authority to institute suit for the 1926 taxes until they have first brought.suit to enforcé the payment of the prior delinquent taxes and applied the proceeds of that vSuit to the discharge of the obligations of the district. A demurrer to this answer was sustained, and defendants stood on their answer, and have appealed.

We think the demurrer was properly sustained. In the orderly administration of the finances of the district, suits to enforce the payment of the 1923 and 1924 taxes should have been instituted before the suit to enforce the 1926 taxes was brought. There is no allegation, however, that the commissioners do not intend to enforce the payment of the 1923 and 1924 delinquencies. On the contrary, the notice of the 1926 delinquency contains the recital that “for the information of the taxpayers a list of delinquent lands for the years 1923 and 1924” is also published, and we must assume that the commissioners will yet collect these delinquent taxes by snit for that purpose, if necessary.

The question of the authority to levy taxes for the year 1926, while prior delinquent taxes remained uncollected, was'raised in the case of North Arkansas Highway Imp. Dist. No. 2 v. Rowland, 170 Ark. 1168, 282 S. W. 990, the present appeal being; in effect, a continuance of that litigation. The former appeal Was a proceeding to mandamus the clerk of the county court of Fulton County to extend the taxes against the lands in the district in that county for the year 1926. It was there- insisted, as it is here, that the commissioners had not brought suit to enforce the payment of the 3923 and 1924 taxes, but Ave said in the opinion on the former appeal that this could be compelled at the suit of any interested party.

The fact that other landowners have defaulted in the payment of the taxes for a prior year does not excuse the refusal of appellants to pay for a subsequent year. All can be required to pay, and, Avhile the procedure of the commissioners is not to be approved, there is no lack of power on their part to institute this suit. Indeed, § 26 of the act of 3917, supra, imposes the duty on the commissioners of instituting suit to enforce the payment of delinquent taxes.

There is no showing that the total proceeds of suits to enforce the payment of all delinquent taxes Avill not be required to discharge the outstanding obligations of the district. The only allegation of the answer relating to this subject is the one that, by act No. 11 of the 1927 session of the General Assembly, the. State has taken over all the bonded obligations of the improvement district. The ansAver does not allege that there Avere no other obligations in addition- to the bonded indebtedness.

Appellants are mistaken, however, as to the effect of act No. 11 of the Acts of 1927. Section 3 of this act provides that: “The (Highway) Commission shall each year, beginning with the year 3.927, allot to each road district in the State hoav having outstanding bond issues an amount equal to its bonds maturing during the year.” The act contains no authority for paying bonds which matured prior to the beginning of the year 1927.

Act No. 112 of the Acts of 1927 is entitled “An act to provide for the collection and disposition of taxes in road improvement districts,” and by § 1 thereof it is provided that “funds derived from taxes in road improvement districts shall be used by each district to pay its bonds, interest and other valid and outstanding indebtedness which matured prior to January 1, 1927. The balance, if any, shall be used to pay bonds and interest maturing after January 1, 1927, or for construction, repairs and maintenance, subject to the restrictions hereinafter set forth, which are intended to govern the expenditure of such funds.”

Section 6 of act 112 requires that “the commissioners of all road districts shall, as soon as practical,^ collect the delinquent taxes which were due and payable prior to January 1, 1927.”

The manifest purpose of the two acts of 1927 to which we have referred is to require all improvement districts to collect all taxes delinquent prior to January 1,1927, and for the State to pay only such bonds or interest thereon as mature after that date.

We conclude therefore that the demurrer to the answer was properly sustained, and the decree so ordering is therefore affirmed.