author: Hart, C. J.,

text:
    State v. Phillips.
    Opinion delivered April 23, 1928.
    1. Animals — petition for stock-law election. — A petition without a requisite number of signers, adding a township to those named in prior petitions, each of which was in like form1, referred to others, and represented that they were in effect one petition, could not be joined with them and made the basis of an order calling the stock-law election under Crawford & Moses’ Dig., §§ 321-332, as amended by Acts 1921, p. 427; there being a variance between the description of the territory described in the original petitions and that described in the order calling the election.
    2. Animals — petition for stock-law election. — A petition * containing the requisite number of signers for a stock-law election is a jurisdictional prerequisite to the exercise of the county court’s jurisdiction to call the election, which it cannot do on its own motion.
    3. Animals — validity of order calling stock-law election. — The invalidity of a county court’s order calling a stock-law election in six townships, one of which was added by a petition not signed by the requisite number of qualified electors, was not cured by a chancery court decree restraining the holding of the election in such townships, the chancery court having jurisdiction to restrain the election, but not to cancel or amend the county court’s order.
    4. Animals — invalidity of order calling stock-law election.— An order of the county court calling a stock-law election under Crawford & Moses Dig., §§ 321-332, as amended by Acts 1921, p. 427, not being signed by the requisite number of qualified electors, was not validated by Acts 1927; p. 227, validating special elections for creation of “no-fence” laws on different days than that named in the act, or for other causes.
    Appeal from Craighead Circuit Court, Jonesboro District; W. W. Bandy, Judge;
    affirmed.

      STATEMENT OE EAOTS.
    Eli Phillips was convicted before a justice of the peace and fined $5 for allowing- his stock to run at larg-e, in violation of the local option stock law. Upon appeal he was tried before the circuit court sitting as a jury, upon an agreed statement of facts, which is substantially as follows: The requisite number of qualified electors of the townships of Jonesboro, Herndon, Powell, Brooklyn and Nettleton filed a petition in the county court praying for an order giving them the right to vote on the question of restraining horses, cattle, etc., from running at large in said townships. Several petitions were circulated at the same time, and each petition contained a clause reciting that the qualified electors signed the petition knowing that other petitions of the same effect were being circulated, and they authorized the petition signed to be consolidated with the other petitions of like form and character so as to constitute and be presented to the county court as one petition. Subsequently an additional petition was circulated adding the towmship of Greenfield to tfiose above named. The requisite number of qualified electors did not sign this petition. It was, however, considered by the county court as being a part of the other petitions above referred to and described, and all of the petitions were considered as one. It was thereupon ordered by the county court that an election be held on the 5th day of January, 1926, at the usual voting* places in said townships, for the purpose of determining whether the prayer of the petition should be granted. Notice of the election was given as required by statute. Upon the petition of certain residents of Greenfield Township, the chancery court of Craighead County made an order restraining the holding of said election in Greenfield Township. On the 5th day of January, 1926, the .special election was held in each of said townships except Greenfield. On January 8, 1926, the election commissioners of Craighead County filed a report in the county court showing the result of said election in all of said townships except Greenfield, and the result of said election shows that the stock law carried in Powell, Brooklyn, Nettleton, Herndon and Jonesboro townships.
    The judgment of the circuit court recites the finding of facts .by the court substantially as above stated. Thereupon the circuit court declared the law to be that the county court had no authority to render the order calling an election for January 5, 1926, for the purpose of voting on the question of restraining animals in the townships of Jonesboro, Herndon, Nettleton, Brooklyn, Powell and Greenfield. The court was of the opinion that the order was void because it fixed the boundaries of the proposed district different from that in the only petition submitted from which the court could have acted. It was therefore ordered and adjudged that Eli Phillips , was not guilty of violating any law of the State of Arkansas by permitting his stock to run at large within the boundaries of the above-named townships, and he was discharged from custody. The State has brought the case here on appeal.

      Ivie G. Spencer, for appellant.

      Penix & Barrett, for appellee.
   Hart, C. J.,

(after stating the facts). The judgment of the circuit court was correct.

The stock district in question was attempted to be formed under the provisions of §§ 321-332 inclusive of Crawford & Moses ’ Digest, as amended .by act 427 of the General Acts of 1921. See General Acts of 1921, p. 427. Under § 321 of Crawford & Moses’ Digest, as amended by act 427 of the Acts of 1921, whenever twenty-five per cent, of the qualified electors of three or more townships in a body, as shown by the election returns for Governor at the last election preceding the date of the petition, shall petition the county court to vote on the question of restraining certain designated animals from ■running at large, the county court shall make an order for such election in said townships at any general election for State, county and township officers* or at a special election called for the purpose. Several different petitions were circulated at the same time, .signed by the requisite number of qualified electors, asking that a special election be called in the townships of Jonesboro, Nettleton, Herndon, Powell and Brooklyn. Each of these petitions was of like form, and referred to the others, and represented that they were in effect one petition. This is true because each of the petitions was for the identical purpose. They asked for a local option stock-law election to be held in five different townships, which were named in each petition. The different petitions therefore constituted a unit for the calling an election in the same townships. Another petition was filed, asking for the calling of a stock-law election in these five townships, and there was added the township of Greenfield. This. petition, however, did not contain twenty-five per cent, of the qualified electors, as required by the .statute. It could not become a part of the unit of the other petitions which called for the election in the same five townships and which did contain more than twenty-five per cent, of the qualified electors of said townships.

The order of the county court was based upon the petitions filed, and ordered the special election to be called in the six townships, including Greenfield Township. There was a variance between the - description of the territory embraced in the petitions which contained the requisite number of qualified electors and the territory described in the order of the county court calling the special election to be held January 5, 1926. This was fatal to the validity of the order. ■ The petitions calling for the election in the townships of Jonesboro, Brooklyn, Powell, Nettleton and Herndon constituted a unit because, although the signatures were to different petitions, they were all written in precisely the same language and had the same end in view. When the petition adding Greenfield Towfiship was circulated, this constituted a materially different petition, and it could not be joined with the others. Not having the requisite number of signers, it could not be made the basis of an order calling the election. The county court had no right to call the election except upon a petition as provided by the statute; and a compliance with the provisions of the statute in this respect was a prerequisite to the exercise of jurisdiction by the county court. It could not call a stock-law election on its own motion.

In Fesler v. Eubanks, 143 Ark. 465, 220 S. W. 457, it was held that a petition selecting and grouping three or more adjoining townships in a stock district is jurisdictional, and that an oyder of the county court calling for a stock-law election not based on such petition is void, and subject to collateral attack. The reason for such holding is clearly stated in Coleman v. Hallum (Comm. of Appeals of Texas), 232 S. W. 296, where it was said:

“The petition for an election is fundamental and jurisdictional. It is the basis of the court’s action in ordering the election. The court is not at liberty to disregard the request to order the election prayed for, if the requisites of the statute have been complied with; n,or is it at liberty to alter the request for an election by ordering an election different' from the one called for by the petition. The construction contended for would ascribe to the commissioner’s court the doing of an unauthorized act — the ordering of an election without a petition as a basis thereof — and also the ordering of an election that would be void because of the uncertainty as to what was to be submitted and voted upon therein.”

It is claimed, however, that this defect in the order of the county court was cured by the decree of the chancery court restraining the holding of the election in Greenfield Township. We do not agree with this contention. The chancery' court had jurisdiction to restrain the election because it was made upon a void order, but it had no jurisdiction to cancel or amend the order of the county court. As we have already seen, the order of the county court must be. based upon the petitions filed; and it was void because the order as made was not based upon the petition of the requisite number of qualified electors as provided by statute. No subsequent decree of the chancery court could give validity to the order of the county court.

Finally, it is contended that the order of the county court was made valid by the curative act passed by the Legislature of 1927, which was an act to validate special elections held for the creation of “no-fence” laws. Acts of 1927, p. 227. The act by its terms proposed to validate said elections which were irregular by reason of being held on a different day from the date named in the act, or for other causes. It does not in any sense attempt to validate an election which had no validity in the beginning, or which was held under a void order of the county court.

Therefore we hold that the judgment of the circuit court discharging Eli Phillips was properly rendered, and the appeal of the State will be dismissed.


source: Caselaw Access Project

license: Public Domain

text:
    Smith v. Bank of Marianna.
    Opinion delivered April 23, 1928.
    Evidence — parol evidence contradicting written agreement. — A written contract cannot be contradicted or varied iby evidence of an oral agreement between the parties before or at the time of ■the execution of such contract.
    Appeal from.Lee Circuit Court; W. D. Davenport, Judge;
    reversed.
    STATEMENT OK KAOTS.
    Ben H. Smith instituted this action in the circuit court against the Bank of Marianna to recover the sum of $130, alleged to be due on an advertising contract. The bank filed an answer in which it denied that the plaintiff had complied with its contract, and alleged that the plaintiff had refused to deliver suitable advertising material according to the terms of the contract.
    The contract sued on was introduced in evidence. It was in writing, but a synopsis of its terms will be sufficient to determine the issue raised by the appeal. Ben H. Smith contracted to give the bank seventy-eight “Who’s Who” advertising engravings, with ads and lobby cards, bulletin, and copy of monthly letter. The bank agreed to pay for the service, which was for eighteen months, at $2 per week, or a total of $156. Failure to pay any installment when due rendered the entire balance due. It was provided that all promises and agreements were stated in the contract and that verbal agreements with salesmen were not authorized. The contract also contained a clause that it was the entire contract, and that the purchaser of the advertising material acknowledged that the contract had been read carefully.
    The cashier of the bank was a witness for it, and admitted that, under the terms of the contract, the bank agreed to pay $156 for the material supplied, and that a down-payment of $26 had been made. The material mentioned in the contract was promptly sent to the bank and received by it. The electric bulletin was broken, but the 'Seller offered to supply a new one. The cashier of the bank said that the bank refused to pay for the advertising material because the reading-matter would not “tie-in” with the cuts, and the salesman had represented that they would “tie-in.”
    There was a verdict and judgment for the defendant, and the case is here on appeal.

      Griffin Smith, for appellant.
   Hart, C. J.,

(after stating the facts). The sole reliance of the plaintiff for a reversal of the judgment is that the court erred in allowing the defendant to introduce evidence to show that the salesman of the plaintiff represented, at the time the contract was executed, that the reading material would “tie-in” with the cuts. No such provision was inserted in the contract. On the contrary, in plain terms the contract recites that it is the sale of “seventy-eight Who’s Who advertising engravings with ads and lobby cards, bulletin, and copy of monthly letter. ’ ’ The contract provides that all promises and agreements are 'Stated therein, and that verbal agreements with salesmen are not authorized.

We are of the opinion that the court erred in allowing the testimony of the cashier of the bank to be introduced before the jury. His testimony to the effect that the salesman told him that the advertising material would “tie-in” with the cuts was plainly contradictory of the terms of the written contract. This court has uniformly enforced the general rule that a written contract cannot be contradicted or varied by evidence of an oral agreement between the parties before or at the time of the execution of .such contract. Federal Lumber Co. v. Harris, 152 Ark. 448, 238 S.. W. 611; Delaney v. Jackson, 95 Ark. 135, 128 S. W. 859; and Pictorial Review Co. v. Rosen, 171 Ark. 719, 285 S. W. 385.

In the last case cited the court upheld a ruling of the trial court to the effect that parol evidence would be admitted to show that a traveling salesman had induced a customer to sign a printed form of contract in blank because he was in a hurry to catch a train, and promised to fill in the terms of the contract in accordance with the terms of their agreement. The purchaser had confidence in him, and relied upon his representation. The salesman filled out a contract different from the one the purchaser made, and, as soon as the purchaser found it out, he countermanded the order and notified the company not to ship the goods. The court held that the evidence of the purchaser was not a contradiction of the writing, but showed what was the real agreement between the parties.

No such condition exists in the case at bar. The evidence for the bank, which was admitted over the objections of tbe plaintiff, was to the effect that the salesman of the plaintiff had represented that the advertising material bought would “tie-in” with the cuts. As we have already seen, this was contradictory of the terms of the written contract which was signed by the parties after being written. Therefore tbe court erred in admitting it over the objections of the plaintiff, and for that error the judgment must be reversed.

Inasmuch as the case seems to have been fully developed, no'useful purpose could be served by remanding it for a new trial. The undisputed evidence shows that the sum of $130 is due the plaintiff by the defendant on the contract, and that the whole of this amount is due. This amount should bear interest under the contract as follows: $52 from February 1, 1927, and $78 from August 1, 1927. It is ordered that judgment be entered here in favor of the plaintiff against the defendant for said sum.


author: Wood, J.

text:
    Webster v. Telle.
    Opinion delivered April 23, 1928.
    1. Contracts — construction by parties. — When the parties to a contract have given it a particular construction, such construction will generally be adopted by the court in giving effect to its provisions.
    2. Insurance — assignment op policies. — Evidence held -sufficient (to justify a finding that there was an oral and equitable assignment of policies 'by insured to- his wife.
    3. Insurance — right op insured to assign policy. — Life insurance policies are choses in action, which the insured has a right to assign for a money consideration, or to give away, so long as the assignment does not involve an illegal, fraudulent, or wager transaction.
    4. Insurance — oral assignment op policy. — An oral assignment of a life insurance policy by insured to his wife is valid, notwithstanding a provision of the policy made for the benefit of the company, requiring a written assignment, where the company made no objection to a verbal assignment.

      5. Insurance — waiver by insurer op provisions in policy. — Provisions in a policy of insurance made for the benefit of the insurer may be waived by the insurer.
    6. Appeal and error — evidence considered on appeal. — The Supreme Court will consider only the competent testimony in the record of a chancery court, or such only as the chancellor should have considered.
    7. Witnesses — competency op widow. — A widow claiming to be beneficiary under her husband’s life insurance policy is a competent witness in her own behalf and could testify to facts relative to her right, so long as she did not testify to transactions with or statements of her deceased husband.
    8. Witnesses — competency op widow. — Testimony of a widow claiming to be beneficiary under life insurance policies of her deceased husband, that she was in possession of the policies prior to her husband’s death, was competent and relevant.
    Appeal .from Union Chancery Court, Second Division; George M. LeCroy, Chancellor;
    affirmed.

      T. O. Abbott and C. B. Crumpler, for appellant.

      John E. Harris and E. L. Compere, for appellee.
   Wood, J.

On .April 13, 1922, the Prudential Insurance Company of America, hereafter called company, issued two insurance policies to Edwin M. Telle, each in the sum of $5,000, insuring his life in favor of the Alexander Refining Company, Inc. Each of the policies contained the following provision:

“Change of beneficiary. If the right to change the beneficiary has been reserved, and if the insured shall have attained, to majority according to the laws of the State in which insured resides, the insured may, at any time while this policy is in force, by written notice to the company at its home office, change the beneficiary or beneficiaries under this policy, such change to be subject to the rights of any previous assignee and to become effective only when a provision to that effect is indorsed or attached to the policy by the company, whereupon all rights of the former beneficiar}'- or beneficiaries shall cease.”

The right to change the beneficiary was not reserved in either one of the. policies. On October 14, 1925, the company, at the request of Telle and of the beneficiary named in the policies, exchanged the beneficiary named by substituting the “executors, administrators or assigns” of the assured, instead of the beneficiary originally named. Telle 'Obtained a loan on the policies in the sum of $638. In a financial statement made December 18,1926, by E. M. Telle to the Exchange Bank & írust Company of El Dorado, Arkansas among other things, is the following: “Life insurance carried for $15,000. Beneficiary, wife.”

On January 11, 1927, Telle executed his last will and testament, which, among other things, provides':

“I have made my beloved wifé, Bernice Phillips Telle, the beneficiary of three life insurance policies of $5,000 each (giving the date and number of the policies). All of these policies are in the Prudential Insurance Company of America. ■ There is a loan of about $1,200 to be deducted from the total of $15,000. -T request that from the proceeds she shall pay the National Bank of Commerce of El Dorado $7,500, due March 5, 1927. This is the amount that they have loaned Mrs. Telle on her house, No. 825 West Main Street, El Dorado, Arkansas. She loaned this amount to me, which I used in my business. * * * I appoint Mr. N. L. Webster of El Dorado, Arkansas, as agent to wind up the business. I regret exceedingly that some heavy investments in the year 1926 proved to be unprofitable and so depleted my cash balance to such an extent that I am unable to continue in business any longer. There will be a loss to the creditors, because the property will not sell at a forced sale for the actual cost price.”

On the 12th day of January, 1927, Telle committed suicide at the Marion Hotel, Little Rock, Arkansas, while the policies of insurance named in the will were in full force and effect. On the 18th of January, 1927, the will of Telle was duly probated, and letters testamentary were issued on January 19, 1927, to N. L. Webster, the executor named in the will. Proof of death was submitted to the company, and it admitted liability on the two policies in the sum of $9,435.46. Webster demanded payment of the amount due under the policies as executor of the estate of Telle. Mrs. Bernice Telle, the widow, demanded payment to her of the amount due under the policies.

On April '26,1927, the company instituted this action in the Union Chancery Court, naming* the executor and Mrs. Telle as defendants. It admitted its liability under the policies and its willingness to pay the same to the person legally entitled thereto, and tendered into court the sum, of $9,435.46, and prayed that Webster and Mrs. Telle be required to interplead for the funds in order that their respective rights be determined and that the company might pay the sum due under the policies to the person adjudged by the court to be entitled thereto.

N. L. Webster and Mrs. Telle each filed an' inter-plea for the funds. Webster alleged that he was entitled to the funds under the will, in which he was named executor, and under the policies, by the terms of which the sums due under same were to be paid to him as executor. Mrs. Telle alleged that she was entitled to the funds as the beneficiary under the terms of the will, naming her as the sole beneficiary, and under the terms of the policies on the ground, as she alleged, that Telle, during* his lifetime, had assigned and delivered the policies to her as security for certain money she had loaned him, and which was due at the time of his death. She further alleged that Telle, during his lifetime, by written declaration and by the solemn declaration made in his will on the day before his death, had made her the beneficiary in the policies. She alleged that any reasonable method adopted by her husband to make her the beneficiary under the policies would legally change the beneficial interest to her, and that she was entitled to recover both as equitable assignee and as substituted beneficiary.

Webster replied to the interplea of Mrs. Telle, denying its allegations.

It was conceded :by the executor and Mrs. Telle that the sum of $9,435.46 was due under the policies, and this amount was paid by the company into the registry of the court, and the company was discharged from further liability under the policies. The action progressed between the interpleaders, the executor and Mrs. Telle, as to which of them was entitled to the fund in court. The cause was heard upon the pleadings and exhibits, the depositions of witnesses and an agreed statement of facts, and the court found in favor of Mrs. Telle, and rendered a judgment accordingly in the sum of $9,435.46, with interest; from which judgment N. L. Webster, the executor, duly prosecutes this appeal.

Learned counsel for the appellant, in their excellent brief, say: “There are but two issues involved in this appeal. The first issue is: Was there a change of beneficiary in the two life insurance policies in favor of appellee, prior to the death of Edwin M. Telle, the assured? The second issue is: Was there a debt owing by the assured at the time of his death to the appellee, and was there an assignment of the insurance policies to secure that debt?”

'The conclusion we have reached on the first issue as stated by counsel makes it unnecessary to set out all of the testimony adduced on the second issue. The original beneficiary named in the policies was the Alexander Refining Company, Inc., which, at that time, was the employer of the assured, Edwin M. Telle.'

The policies contain, among others, the following provision: “If there be no beneficiary .living' at the death of the insured, the amount of insurance payable shall be paid to the executors, administrators or assigns of the insured, unless otherwise provided in the policy. The right to change the beneficiary has not been reserved by the insured. ” Notwithstanding this provision of the policies, that “the right to change the beneficiary has not been reserved by the insured,” it will be observed that the parties to the insurance contracts, to-wit, the insurance company, the Alexander Refining Company, ’ the beneficiary, and Edwin M. Telle, the insured, on October 14, 1925, agreed to change, and on October 19, 1925, did change the beneficiary from the refining company to “the executors, administrators or assigns of the insured.” In making the change the provisions of the policies in regard to the change of beneficiary as set out above were followed. The parties therefore to the contracts of insurance seem to have treated the provisions of the policies with reference to change of beneficiary, where there was a change, as binding. Therefore, if it could he said that there had been a change in the beneficiary of the policies from the executors, administrator or assigns of the insured to the appellee, Mrs. Bernice Phillips Telle, then we would be inclined to follow the provisions of the contracts of insurance as construed by the parties themselves in order to effectuate such change. For the law is that, “when the parties to a contract have given it a particular construction, such construction will generally be adopted by the court in giving effect to its provisions, and the subsequent acts of the parties showing the construction they have put upon the agreement themselves are to be looked to by the court, and, in some cases, may be controlling.” 9 Cyc. 588; 6 R. C. L. 862. But, as we construe the “change of beneficiary” clauses in these insurance contracts, there has been no change of beneficiary since the change was made from the refining' company to that of “executors, administrators or assigns of the insured.” • The beneficiary in the policies at the time of Telle’s death, if there had been no assignment of the policies, was his executor, the appellant. But, if the policies had been assigned bjr Telle to his wife, then the beneficiary was his assignee, Bernice Phillips Telle, the appellee.

This brings us to the question — and, as we view it, the only question — necessary to be decided in the case, to-wit, whether or not the beneficial interest under the policies -had been assigned by the assured, Edwin M. Telle, to his wife, Bernice Phillips Telle. The provision in the policies of insurance with reference to the assignment of such policies is as follows: “Any assignment of this policy must he in writing, and the company shall not be deemed to have knowledge of such assignment unless the original or a duplicate thereof is filed at the. home office of the company. The company will not assume any responsibility for the validity of an assignment.” This provision of the policies was not complied with by the assured, and the appellant therefor^ contends that there was no assignment of the policies. But the appellee contends that she was the assignee under the policies under an oral and equitable assignment thereof.

The competent testimony on this issue is substantially as follows: The appellee testified that the policies had been in her possession ever since three or four days before she executed a mortgage to the National Bank of Commerce, on January 5, 1926, at which time she examined each of the policies, and they are the policies which were delivered to her. She kept the policies a few days, hut did not have any place to lock them up. She next saw the policies of insurance after her husband’s death. The mortgage she referred to secured a loan by her from the National Bank of Commerce at El Dorado, Arkansas, in the sum of $7,500, due six months from date. ' The property contained in the mortgage constituted her individual property. She did not get the $7,500 for which the mortgage was executed, but her husband took the money and used it in carrying on his business. The insurance policies were delivered to her by Mr. Webster, after her husband’s death, wrapped in his will, in a package sent to her from Little Rock, Arkansas, and addressed to her, and when she opened it there were these two policies and the will. No part of the $7,500 which she loaned her husband in 1926, which was borrowed from the National Bank of Commerce of El Dorado, and for which he gave a mortgage on her El Dorado home property, had ever been paid to her.

The appellant, Webster, testified that the two life insurance policies were delivered to him by the coroner of Pulaski County, in a bundle with other papers. He delivered the insurance policies and all the papers 'in the package to Mrs. Telle, personally. He did this for the reason that there was a note left by Mr. Telle instructing that these papers be delivered to her.

The declaration in the financial statement made to the Exchange Bank & Trust Company by Telle, to the effect that he carried life insurance for his wife as bene-, ficiary in the sum of $15,000, and also the statement in his will to the effect that his wife was the beneficiary of three life insurance policies in the sum of $5,000 each, have already been set forth. We are convinced that the above testimony is amply sufficient to justify a finding that, as between Telle and his wife, Telle had assigned the insurance policies to her. It was unquestionably the intention of Telle that the amounts due under these policies at the time of his death should be paid to his wife, the appellee. The evidence is susceptible of no other conclusion. True, Telle did not use in his will and in his financial statement the technical word “assign” in referring to the beneficial interest under the policies, but his meaning is clear that he intended that his wife should have the amount of the policies and that he had already made this provision for her. The testimony of Mrs. Telle shows that the policies had been delivered to her prior to Telle’s death.

Now, the creditors of Telle had no interest whatever in his insurance policies as long as Telle was alive, because, as long as he was living, he had the right to assign the policies to whomsoever he desired, provided the assignment did not involve an illegal, fraudulent, or-wager transaction. His life insurance policies were choses in action, which he had the perfect right to assign for a money consideration, or to give away. As was said in New York Mutual Life Insurance Company v. Armstrong, 117 U. S. 591, 6 S. Ct. 877, 29 L. ed. 997: “A policy of life insurance without restrictive words is assignable by the assured for a valuable consideration equally with any other chose in action, where the assignment is not made to cover a mere speculative risk and thus evade the law against wager policies.” And in Page v. Metropolitan Life Insurance Co., 98 Ark. 340, 135 S'. W. 911, we said: “A life policy is a chose in action, a species of property, which the holder may have perfectly good and innocent reasons for wishing to dispose of. * * .* The insured had the same right to give.as he had to transfer the policy for a valuable consideration.” See also Matlock v. Bledsoe, 77 Ark. 60, 90 S. W. 848.

There is nothing in this whole record to indicate any fraud in the assignment by Telle of the policies in controversy to his wife. On the contrary, the provision he thus made for her by the assignment of his policies, under the circumstances which surrounded him, was exceedingly commendable. The amount of the policies which he maintained and which he assigned to her was certainly not indicative of any fraudulent purppse to deplete his estate to. the injury of his creditors, but rather only to protect the one who was nearest and dearest to him, and who had rendered him every financial and other assistance in her power, and who, above all others, had an insurable interest in his life. Although there was no written assignment of the policies in controversy by Telle to Mrs. Telle, yet, as we have seen, there was an oral, and therefore an equitable, assignment of such policies. In Citizens’ Bank v. Moore, 134 Ark. 554, 204 S. W. 619, we said: “We think the direction for a change in the beneficiary for the purpose of effecting an assignment thereof, together with the delivery of the original policy, constituted an equitable assignment, though not formally made in writing. Parol assignments of insurance policies, when accompanied by delivery, are sustained as equitable assignments thereof (Citing eases).” 'That doctrine is applicable to the facts of this record.

But learned counsel for appellant contend that, under the written provisions of the policies set out above with reference to assignments, the policies could not be orally assigned. The language of this provision of the policies shows that it was made for the benefit of the company and not for the benefit of the beneficiary named, or for the assured, his executors, administrators or assigns.

In Cooley’s Briefs on Insurance, vol. 2, page 1812, it is said:

“ Though it is true in a general sense that, in order to effectuate an assignment of a policy, or any part of it, the terms and conditions imposed by the policy to accomplish that purpose must be complied with (Metro. Life Ins. Co. v. Zgliczenski, 94 N. J. Eq. 300, 119 A. 29), it is nevertheless a general rule that, where a company makes no objection to an assignment on account of a failure to comply with its rules in relation thereto, and the assignment is otherwise valid as. between the parties in interest, no objection can be raised by any of them on account of such formal deficiencies.”

To support the text the following cases are cited: Conway v. Supreme Council Catholic Knights of America, 131 Cal. 437, 63 Pac. 727; Diffenbach v. New York Life Ins. Co., 61 Md. 370; Hewlett v. Home for Insurables, 74 Md. 350, 24 Atl. 324, 17 L. R. A. 447; Brierly v. Equitable Aid Union, 170 Mass. 218, 48 N. E. 1090, 64 Am. St. Rep. 297; Burgess v. New York Life Ins. Co. (Tex. Civ. App.), 53 S. W. 602; Kendall v. Morrison, 33 Tex. Civ. App. 345, 77 S. W. 31. See also New York Life Ins. Co. v. Rosenheim, 56 Mo. App. 27, “where the decision was placed rather on the ground of estoppel.”

It is the established doctrine of this court that provisions in a policy of insurance made for the benefit of the insurer may be waived by such insurer. Ætna Life Ins. Co. v. Duncan, 165 Ark. 395-407, 264 S. W. 835. We are aware of the doctrine announced by this court to the effect that the change of -beneficiary in a benefit certificate issued by a fraternal or mutual benefit society cannot be made by the insured unless there is substantial compliance with the by-laws and regulations of the society. Wilkes v. Hicks, 124 Ark. 192, 186 S. W. 830; Robinson v. Robinson, 121 Ark. 276, 181 S. W. 300; Sovereign Camp W. O. W. v. Israel, 117 Ark. 121, 173 S. W. 855; Caruth v. Clawson, 97 Ark. 50, 133 S. W. 178. Counsel for appellant invoke the doctrine of the above ’ cases to sustain their contention that there was no assignment of the policies in the case at bar because the assignment was not in writing, as the policies require. 'But the doctrine of these cases has no application to ordinary life insurance contracts or policies issued by standard old-line life insurance companies. While the benefit certificates of fraternal and mutual benefit associations insuring the lives of their members are contracts of insurance upon which such societies or associations are liable to the holders and beneficiaries of such certificates, nevertheless the character of the contracts is wholly different from those of old-line -standard life insurance companies. The fraternal, mutual benefit associations are what their names imply. Their policyholders are the only members of the society. The'-obligations of their -policies are discharged by assessments upon their members, -and all -of the members -are mutually and reciprocally interested in the conduct and management of the society according to the constitution and b-y-laws which they have framed and adopted for the government and conduct of the association to which they belong.

Mr. Niblack, speaking of mutual benefit societies, says : “A society may provide that its contract of insurance may be assigned and transferred only with the consent of the society indorsed thereon. * * * The right of the contracting parties to thus prohibit an assignment of the certificate without the consent of the society cannot be .seriously doubted, and, in view of the restricted nature of the mutual benefit insurance, the propriety, if not the necessity, of such a condition is equally clear. The personal character of each holder of a certificate and the interest he may have in the life of the person thereby insured are essential elements in the contract of mutual indemnity.” Niblack, Accident Ins. & Benefit Societies, page 329, § 169. See also Vance on Insurance, page 400, where the author, after setting forth the relation existing between mutual benefit societies and their members, says.: “From this .statement of the relation between the mutual association and its members it is apparent that the contractual relation strikingly differs from that existing between regular insurance companies and their policyholders.”

In Robinson v. Robinson, supra, speaking of the rights of the members and policyholders to change the beneficiary, we said: “Manifestly, however, such a transaction requires some formalities for the protection of the company, the member, and the beneficiary, and these formalities must be-substantially complied with before the change of beneficiary becomes effective.”

The doctrine of Wilks v. Hicks, supra, and the other cases supra relied on by counsel for appellant, cannot be extended or applied to policies of insurance like those under review here. The rule applicable here is that announced by Mr. Cooley and the cases cited by him, and is forcefully stated by the Court of Appeals of Maryland in Diffenback v. New York Life Ins. Co., supra, as follows:

“Claiming, as the appellants do, under an assignment of policies of life insurance, the validity of which the insurance companies have not denied, but have paid the amounts .secured .by them into court for payment to whoever may be entitled, the legality of the transaction does not arise, as we think. The proceeds must be disposed of according to the equities of the complainants and defendants, respectively.”

As was said by Judge Mansfield, speaking for tbe court in McDonald v. Humphries, 56 Ark. 63, 19 S. W. 234: ‘ ‘ Tbe company, having paid the money into court, was released from liability to either of the parties, and had no further interest in the litigation. The question which remained for the decision of the court involved only a proper disposition of the fund as between the plaintiff and the other defendant.”

The assignment of the policies by Telle to his wife ipso facto made her, as his assignee, the beneficiary of those policies under their very terms. Thereafter, and at the time of his death, Telle had no interest therein, and of course the executor of his estate and the creditors had none, because they had only such rights as Telle himself had at the time of his death. In reaching the conclusion that the appellee, Mrs. Telle, was the assignee of Telle, and therefore the beneficiary of the policies, we have considered only the competent testimony in the record, or such only as the trial court should have considered under the rule announced in Latham v. First National Bank of Fort Smith, 92 Ark. 321, 122 S. W. 992, and Cox v. Smith, 99 Ark. 218, 138 S. W. 938, and Martin v. Manning, 124 Ark. 84, 186 S. W. 302. The appellee was a competent witness in her behalf, and she could testify to facts relevant to her rights, so long as she did not testify to transactions with or statements of the testator. As to these, to be sure, her testimony was incompetent. Constitution 1874, § 2 of the Schedule; Wilson v. Edwards, 79 Ark. 69, 94 S. W. 327; Carter v. Younger, 123 Ark. 266, 185 S. W. 435 ; Free v. Maxwell, 138 Ark. 489, 212 S. W. 325; § 4144, C. & M. Digest.

Under the above rule of the Constitution and statute, the testimony of the appellee, that she was in possession of the policies prior to the death of Telle, was competent and relevant. This testimony, in connection with the declarations made in the financial statement of Telle and in Ms will, to the effect that he had made his beloved wife, Bernice Phillips Telle, beneficiary in the policies, and the testimony of appellant himself, to the effect that he had delivered the policies to Mrs. Telle in accordance with directions contained in a letter written to him by Telle on the day the latter died, proved that the appellee was the beneficiary of the policies.

We do not concur in the statement of counsel for appellant that the declarations of Telle, above mentioned, in his financial statement and in his will, were the result of a disturbed and disordered mind. On the contrary, it occurs to us that these declarations but stated a truth in fact and in law. It was conceded by the appellant that Telle was an intelligent business man. As such, he must have known that, under the terms of the policies in controversy, he could not have made Mrs. Telle a .beneficiary merely by appointment, but that the only way she could be made beneficiary would be to assign the policies to her, which he had done. True, as before stated, he did not use the technical term “assignee,” but he did state that he had made her the beneficiary in the policies, which, in the light of the policies themselves, necessarily meant that he had assigned the policies to her. The only reasonable conclusion to be drawn from all this testimony is that Telle knew that he had assigned the policies to his wife, and that he was holding the same for her at the time of his death. There is no merit whatever in appellant’s contention that the appellee, in view of the above testimony, was but a pledgee of the insurance policies' instead of absolute owner thereof. There is nothing in the testimony to justify the conclusion that Telle; at the time he declared that his wife was the beneficiary in the policies, intended thereby to constitute her only a pledgee for the payment of his debts. On the contrary, we are convinced that, when he had declared that she was the beneficiary and gave her possession of the policies, he intended, by this act of assignment in parol, to constitute her the beneficiary and absolute owner of such policies. There is no competent testimony in the record tending to show that Telle had reserved any right to himself to revoke the parol contract of gift or assignment to his wife of the policies in controversy, and he never, up to the time of his death, asserted any such right. Therefore, at the death of Telle the rights of the appellee to the proceeds of the policies became fixed and binding- upon the executor of the estate, and neither he, nor any creditor through him, has a right to assert to the contrary.

The decree of the trial court so holding is correct, and it is therefore affirmed.


author: Humphreys, J.

text:
    Cleveland County Bank v. Doster.
    Opinion delivered April 23, 1928.
    Executors and administrators — right op set-opp against personal representative. — -Where, after the death of intestate, his administratrix deposited funds in a bank to -which intestate was indebted at the time of his death, the bank was not entitled to set-off such deposit against its claims against the intestate.
    Appeal from Cleveland . Circuit Court; Turner Butler, Judge;
    affirmed.

      Wynne & Miller, for appellant.
   Humphreys, J.

Appellee instituted this suit against appellant in the circuit court of Cleveland County to recover $3,840 which she deposited with it in the'capacity of administratrix of her deceased husband’s estate. Appellant filed an answer, interposing the defense that it applied the deposit to the payment of notes to an equal amount which appellee’s- intestate owed it at the time of his death.

The cause was submitted to the court without a jury for determination upon the following agreed statement of facts:

“It is agreed by and between the plaintiff and the defendant that the following are the facts and are to be considered as the only facts in this case: The plaintiff, Lola Doster, is the administratrix of the estate of R. M. Doster, deceased; that she was appointed such by the probate court of Cleveland County on the 31st day of July, 1926; that R. M. Doster, plaintiff’s intestate, died on the 29th day of July, 1926; that, at the time of the death of the said R. M. Doster, he was indebted to the defendant bank in the sum of $3,840, represented'by three promissory notes, copies of which are filed as exhibits to defendant’s answer and admitted to be'correct. It is further agreed by the parties hereto that on August 20, 1926, the plaintiff had on deposit in the defendant bank the sum of $3,840 to her credit as such administratrix, and that there remained no other funds on said date to her credit in said bank; that on said August 20, 1926, the defendant bank applied said sum of $3,840' as a credit and as. an extinguishment of the indebtedness of the said R. M. Doster, plaintiff’s intestate, which indebtedness was represented by said promissory notes, and totaled the sum of $3,840. That on August 4, 1926, the plaintiff deposited with the defendant bank certain cheeks, made payable to R. M. Doster, in the sum of $2,708.92, which amount was placed to the credit of Lola Doster, administratrix, and that thereafter, on several and divers occasions until the 19th of August, 1926, the plaintiff deposited other checks, payable to her as administratrix, totaling1 the sum of $7,034.16; that the proceeds of said checks, so deposited represented the proceeds from the sale of lumber made by the deceased, R. M. Doster, but sold by the administratrix. It is further agreed that, at the death of the said R. M. Doster, he was wholly insolvent, and that claims totaling $25,000 have been duly presented to and allowed by said administratrix against said estate, including a duly verified claim by the defendant bank for the money being sued On in the instant case; that the estate in the hands of the plaintiff administratrix, when applied to the extinguishment of the probated claims and court costs, will pay the creditors less than 10 per cent., assuming that the amount sued on herein is. returned to the administratrix. ”

The trial court rendered a judgment against appellant for $3,840, with interest thereon from August 20, 1926, until paid, and for the costs, from which an appeal has been duly prosecuted to this court.

It is contended by appellant that, under authority of § 1198' of Crawford & Moses’ Digest, it had a right to apply the .sum of money belonging to the estate of the deceased in satisfaction of the debt of appellee’s intestate. The section of the statute relied upon is as follows:

“Set-off against personal representatives. In suits by executors or administrators, debts existing against their testator or intestate, and owing to the defendant at the time of the death of the testator or intestate, may be set-off by the defendant in the same manner as if the action had been brought by and in the name of the deceased.”

Appellant admits that, if the statute is merely declaratory of the .common law, it had no right to make the application, as, under the common law, the debts of a decedent could not be set-off in a suit by the executor or administrator against a person indebted to the decedent. Appellant insists, however, that the statute is not declaratory of the common law, but was passed in derogation of the common law. We think the statute is declaratory of the common law. According to its phraseology, it only allows set-offs in suits brought by executors or administrators against debtors of the testator or intestate which would have been set-off had the testator or intestate brought the suit. In the instant case the intestate could not have brought the suit against appellant because it did not owe him anything at the time he died. The right of set-off under the statute applies to existing indebtedness. Any other interpretation of the act relied upon would result in a preference to any debtor of a testator or intestate who might come into the possession of any of the intestate’s property after his death. We do not understand that a different rule of interpretation was announced in the cases of Fishburne v. Merchants’ Bank of Port Townsend, 42 Wash. 473, 85 P. 38, 7 Ann. Cas. 848, or in tire case of Ainsworth v. California Bank, 119 Cal. 470, 51 P. 952, 39 L. R. A. 686, 63 Am. St. Rep. 135. The question of tlie interpretation of the statute or code in those cases turned upon whether the demand of the debtor against the estate of the testator or intestate belonged to the debtor at the time of the death of the testator or intestate.

No error appearing, the judgment is affirmed.


author: Kirby, J.

text:
    Prewett v. Waterworks Improvement District No. 1.
    Opinion delivered April 23, 1928.
    1. Appeal and error — remand for new triáH. — The general rule in reversing cases of law is. to remand the case for a new trial.

      2. Appeal and error — remand for judgment. — Where an action at law was reversed without directions for trial upon any of the issues involved, the order reversing the case for not rendering judgment in accordance with the views therein expressed and remanding- the case for further proceedings was not a remand for new trial, and appellants were not entitled to make any new issues as grounds of defense which might have- been hut were not presented on the first trial.
    3. Judgment — res judicata. — .The principle of res judicata extends , not only to the questions of fact and law, which were decided on the former trial, but also to the grounds of recovery and defenses which might have been but were not presented.
    4. Appeal and error — pleading—unauthorized .amendments.— Amendments to the answer filed on remand'of the cause without permission of the court were properly stricken out.
    5. Depositories — suit on bond — defense.—In a suit by an improvement district against the sureties on the bond of a bank as depository of the district, it was no defense that the defendants became sureties on the false representation of the hank’s president that he was also signing the bond as surety, which he failed to do.
    Appeal from Little River Court; Seth C. Reynolds, special Judge;
    affirmed.

      Shaver, Shaver & Williams and A. D. DuLaney, for appellant.

      A. P. Steel and Norwood & Alley, for appellee.
   Kirby, J.

This is the second appeal of this case, a .statement of which will be found in Waterworks Improvement Dist. v. Rainwater, 173 Ark. 523, 292 S. W. 989. It was held on the former appeal, tinder the facts proved, that the court should have entered judgment in favor of the improvement district upon the bond oif the depository bank and the sureties thereon for the sum of $4,000, with interest at 4 per cent, as provided in the contract between the bank and the improvement district.

The case was reversed and remanded, it being said in the opinion: ‘ ‘ The court erred in not rendering a verdict in accordance with the views expressed in this opinion, and the judgment will be reversed, and the cause remanded for further proceedings according to law and not inconsistent with this opinion.”

On the remand of the cause the defendants filed an amendment to their answer, setting up that .they became sureties upon the bond on the false representation of A. E. Waters, the president of the bank, that he was also signing said bond as a surety; that the plaintiffs knew their signatures were so procured, and accepted the bond without requiring Waters to sign it as a co-surety, thereby knowingly releasing him from any personal liability on the bond, without the knowledge, consent or acquiescence of the other sureties, and that they were thereby released and absolved from any liability or obligation under the bond.

Another amendment alleged that A. E. Waters was the real party at interest in securing the deposit of funds in the bank, of which he owned three-fourths of the stock} that he handled and negotiated all the transactions connected with it, had the bond prepared, and presented to the other sureties, representing that he w'ould sign same as surety and become jointly liable; that their signatures were procured upon such false representation, and they did not know that Waters was not a surety on said bond until the suit was filed. That he agreed with the defendants to become jointly liable, and fraudulently failed to sign the bond; that he was legally jointly bound by his conduct .with the other defendants, if there was any liability incurred by them on the bond, and that Waters .should be made a defendant, and if any judgment was rendered against the other sureties it should be rendered against him as well. Alleged the joint liability of Waters under the circumstances, and prayed that he be made a party defendant, and that the cause be continued until the next term, etc.

Appellee moved to strike from the files the amended .answers, because any judgment rendered thereon would be inconsistent with the opinion remanding the case, and because the alleged defenses attempted to be set up by the amendments to the answer were known or could have been known to the defendants before the cause was first tried, and because the matters alleged in the amendments stated no defenses to plaintiff’s complaint. Appellees also moved for judgment on the mandate for .the amount, which the court, on the former appeal, held the judgment should have been rendered for.

The -court sustained the motion to strike the amendments to the answer, and, appellants refusing to plead further, rendered judgment for $4,187.48, the amount due according to the opinion of the Supreme Court on the first appeal, and from this judgment this appeal is prosecuted.

Appellants insist that the court erred in striking-out the amendments to their answer, in not granting a new trial, and in rendering a judgment upon the motion against them on the mandate, without the introduction of any further testimony.

The direction in the opinion reversed the cause for the error of the lower court in not rendering a judgment in accordance with the views expressed therein, and remanded the cause for further proceeding's according- to law and not inconsistent with the opinion.

It is true the general rule in cases at law is, upon reversal, to remahd for a new trial, hut there was no direction specifically made for a new trial upon any or all of the issues involved in this case (Longer v. Carter, 102 Ark. 72, 143 S. W. 575; Morgan Engineering Co. v. Cache River Drain. Dist., 122 Ark. 491, 184 S. W. 57; Deason & Keith v. Rock, 149 Ark. 401, 232 S. W. 583, and the order was. not in fact a remand for a new trial in general, and the appellants were not entitled to inject into the case any new issues as grounds of defense which might have been and were not presented on the first trial. The principal of res judicata extends not only to the questions of fact and of law which were decided in the former trial, but also to the grounds, of recovery and defenses, which might have been, but weire not, presented. Howard-Sevier Road Imp. Dist. No. 1 v. Hunt, 166 Ark. 71, 265 S. W. 517; Newton v. Altheimer, 170 Ark. 371, 280 S. W. 641; Harrod v. St. L. I. M. & S. R. Co., 98 Ark. 596, 136 S. W. 974; Hollingsworth v. McAndrew, 79 Ark. 185; Hill v. Draper, 63 Ark. 143, 37 S. W. 574.

The amendments stricken out were not filed by permission of the court anyway, and might have been stricken out on that account. Ark. State Life Ins. Co. v. Allen, 166 Ark. 490, 266 S. W. 449; Meador v. Weathers, 167 Ark. 264, 267 S. W. 787; Temple Cotton Oil Co. v. Davis, 167 Ark. 449, 268 S. W. 38; Road Dist. No. 6 v. Hall, 140 Ark. 241, 215 S. W. 262.

The matter alleged in the amendment attempted to be filed to the answer did not constitute a. defense to appellees’ cause of action anyway, and could have been stricken out under the allegations in the third paragraph in the motion to dismiss, which was in effect a general demurrer thereto..

■ The appellants, signed the bond, as appears from their signatures thereon, after the bank’s signature, by Waters as president, principal, and each of them must have known in so doing that Waters had not signed as a surety, and their answer admits that they knew this before the first trial. The most they could have expected from his being compelled to become a surety and held liable as such would have been contribution from him for the amount of the judgment recovered against and paid by them as sureties upon the bond upon which he should have become surety if their contention was tenable. This would not reduce their liability to appellee in any degree, and they are not precluded on account of this decision from prosecuting any cause for relief they may have or-may be. entitled to against the said Waters on that account.

We find no error in the record, and the judgment is affirmed.


author: Smith, J.

text:
    Skaggs v. Prince.
    Opinion delivered April 23, 1928.
    1. Descent and distribution — family settlement. — Where all of the heirs took possession in severalty of the portions assigned to them in a partition proceeding, such partition is enforceable as a family settlement, notwithstanding irregularities therein.
    2. Appeal and error — conclusiveness of chancellor’s finding.— Where the finding of a chancellor .on the question of fact was not clearly against the preponderance of the evidence, it is conclusive on appeal.
    Appeal from .Randolph Chancery Court; Alvin 8. Irby, Chancellor;
    affirmed.

      JoTm L. Bledsoe, for appellant.

      Walter L. Pope, for appellee.
   Smith, J.

At the trial in the court below from which this appeal comes a voluminous record was made. Numerous pleadings were filed, and a large amount of evidence was taken, but, stripped of all superfluities, the question involved is the correct location of the boundary line between tracts of land owned by appellant and appellee, respectively.

J. H. Skaggs owned a tract of land in Randolph County, adjacent to Black River, incident to which was a ferry across that stream. Skaggs died, childless and intestate, in 1895, and was survived by his widow and six brothers and sisters. The land was an original acquisition, and a partition was made between the widow and these heirs, and the heirs received the part of the land to which the ferry was attached.

In 1897 a suit was brought by certain of these collateral heirs against the others, in which a partition was prayed among them of the portion of the J. H. Skaggs estate which they had received upon the partition of that estate with the widow of J. H. Skaggs. A judgment ordering the partition of the lands among the collateral heirs was rendered in the Randolph Circuit Court, and B. B. Raglin was appointed commissioner to make the partition. Pursuant to this judgment, Raglin, as commissioner, executed deeds to the collateral heirs in severalty to the lands assigned them, respectively, one of these deeds being to the plaintiff, W. L. Skaggs, and another to J. M. Skaggs. The lands assigned and deeded to these brothers of the intestate J. II. Skaggs were coterminous, and were divided by a road known as the Skaggs Perry Road, so that this road formed the east boundary line of the W. L. Skaggs land and the west boundary line of the J. M. Skaggs land, and was referred to in the commissioner’s deeds, to them as constituting their east and west boundary line's, respectively.

•T. M. Skaggs died intestate, and was survived by two children, Mrs. Lavada Holman and Mrs. Rosa Webb. Mrs. Holman conveyed her interest in the land to her sister, Mrs. We'bb, who later conveyed the interest which she had purchased, as well as that which she had inherited, to Oscar Prince, who thus became the owner of the interest which J. M. Skaggs had taken upon the partition by the collateral heirs.

W. L. Skaggs brought this suit against Prince, alleging the facts above stated, and made all persons whose interests have been herein referred to parties. In this suit he prayed the reformation of the deeds of the commissioner, Raglin, both to himself and to his intestate brother, J. M. Skaggs, alleging that both deeds were indefinite, in that the east boundary of one tract and the west boundary of the other was a road, the location of which was not only indefinite, but the said road had been moved to the west, thereby encroaching upon lands assigned to plaintiff, W. L. Skaggs, upon the partition. It was alleged that defendant Prince had thus acquired possession of a strip of land belonging to the plaintiff, and the purpose of the suit was to recover possession of this strip.

Plaintiff himself criticises the partition proceeding under which he acquired his own deed, and the reformation of this deed is one of the grounds assigned for equitable relief.

We do not consider the objections, made to the partition proceeding, for, whatever irregularities there may have been in that proceeding, it is enforceable as a family settlement, for all of the heirs have taken in severalty the portions assigned them, and if the exact and definite location of the Skaggs Ferry Road was known and established as it existed at the time of the partition, that fact would settle this litigation, as both parties claim that line as their true boundary.

There was ho motion to transfer this causé to the law docket, and of all the persons made parties to this suit appellee Prince was the only one to file an answer or other pleading, as the other parties were correctly of the opinion that their own rights would not be affected by any relief granted or denied to the appellant-plaintiff, W. L. Skaggs.

As the commissioner’s deed made the Skaggs Ferry Road the boundary between the W. L. Skaggs tract and the J. M. Skaggs tract, the controlling question of fact in this case is the location of this road at the time these deeds were executed.

The court below found that the plaintiff, W. L. Skag’g's, was not entitled to the possession of the strip of land sued for, and dismissed his complaint as being without equity, and this appeal is from that decree.

This finding of fact by the court was necessarily predicated upon the coincident finding 'that there had been no material change in the location of the Skaggs Perry Road since the date of the execution of the partition deeds. It was essential to a recovery on the part of the plaintiff that the testimony show that this road had been moved to the west of its. original location, otherwise the defendant could not have acquired any portion of the plaintiff’s land. This road was never at uny time straight, nor does its width appear to have been always unvarying; in fact, the traffic did not always travel a beaten, defined path: Consequently the testimony is in irreconcilable conflict as to the exact location of the road in 1917, when the commissioner’s deeds of partition were executed.

The testimony on the part of the plaintiff- is to the effect that the defendant, by clearing his land and building his fence to include the clearing, has moved the road westward so that a portion of plaintiff’s land was thereby taken; but a number of witnesses, who appear to be and to have been equally familiar with this road during the time in which it was alleged to have been, moved, testified that the road had not been moved to the west, and that its present location is substantially identical with its location in 1917.

We think no useful purpose would be served in reviewing this testimony, and, after carefully considering it, we are left in doubt as to the fact in issue, and, as we are unable to say that the finding of the chancellor on this question of fact is clearly against the preponderance of the evidence, it becomes our duty to affirm the decree appealed from. Leach v. Smith, 130 Ark. 465, 197 S. W. 1160.

The decree is therefore affirmed.


text:
    Wooten v. Wooten.
    Opinion delivered April 23, 1928.
    1. Insurance — finding as to mental capacity. — The finding of the chancellor that the insured was possessed of sufficient mental capacity to change the beneficiary of an insurance policy, held not clearly against the preponderance of the evidence.
    2. Witnesses — incompetency of physician — waiver.—Testimony of physicians attending insured held admissible under Crawford & Moses’ Dig., § 4149, in an action on the policy where the insured in his lifetime for himself and beneficiaries waived the benefit of their disqualification.
    Appeal from Jefferson Chancery Court; Harvey B. Lucas, Chancellor;
    affirmed.

      Brewer & Cracraft, for appellant.

      R. W. Wilson and John W. Kimbro, for appellee.
   Smith, J.

The Sovereign Camp Woodmen of the World issued a beneficiary certificate to Edd Wooten, ■which, at the time of his death, on October 25, 1926, was worth $1,173. Ida Belle Wooten was the wife of the insured at the time of the issuance of the certificate, but, in 1920, she obtained a divorce from the insured, and was thereafter deprived of her status as. a beneficiary under the constitution of the insurance order, which provided that, in the event of a divorce, the insured spouse should designate another beneficiary, failing which the insurance should be payable to the next of kin of the insured.

Eloise Wooten, an adopted child of the insured, was the next of kin at the time of the insured’s death, but, two days, before the occurrence of that event, a change of beneficiary was indorsed on the certificate, whereby Thomas F. Wooten, a nephew of the insured, was designated as the beneficiary.

In the suit brought to recover the value of the certificate the insurer filed an answer admitting its liability to the true beneficiary, and it was permitted to pay that sum into court, whereupon it was discharged, and the litigation proceeded between the adopted -child and the nephew.

The court below found the fact to be that, at the time of the alleged change of beneficiary, the insured did not have the mental capacity to perform that act, and judgment was rendered in favor of the daughter for the fund in court, and this appeal is from that decree.

The testimony showed beyond question that the insured was devoted to his adopted child, although she lived with his divorced wife, and that he kept in constant touch with his daughter, about whose welfare he was very solicitous, and that he was especially anxious that his daughter should have an education and should be taught music.

The insured had a stroke of apoplexy about a year' before his death, which left him an invalid, and thereafter until his death his nephew, Thomas, was kind to him in many ways. The insured had a second stroke on October 12, and was taken to a hospital at Crossett two days later.

Dr. Kimbro testified that he was the insured’s physician after the insured was first stricken, and that he saw insured two or three times every week during the year prior to the insured’s death, and that he observed a marked weakening, both mentally and physically. After the second stroke the insured was paralyzed on one side; he could not articulate, but made motions with his. hands to indicate his wants; he could not speak, and would cry when he attempted to do so, and was in no condition to be interviewed. The prognosis was very unfavorable, as there was a lesion of the brain tissue, and it was the opinion of the witness that the insured would live only a few days after being taken to the hospital, and it was also the opinion of the witness that the insured was not normal mentally, and was incompetent to transact any business when carried to the hospital on October 13.

Dr. Spivey, the physician in charge of the hospital, testified that he saw the insured two or three times each day after the insured was. brought to the hospital, and that at no time was the insured competent to transact any business; that he suffered a third stroke on October 21, after which he was conscious only of pain and thirst and hunger, and died on October 25.

The change of beneficiary was made October 23, and the persons then present testified that the insured was conscious, and fully realized what he was doing when he signed the change of beneficiary by mark. The insured was unable to write on account of his condition, but could and did touch the pen, and in this way made his mark, which was witnessed by two of the persons present. Two physicians, who did not see the insured after his stroke, testified, in response to hypothetical questions, that the insured was. not necessarily incompetent mentally, even after the last stroke, to transact business. There was certain other testimony of non-expert witnesses on each side of the question; but, without setting out the testimony any further, we announce our conclusion to be that the finding of the chancellor does not appear to be clearly against the preponderance of the evidence.

Only one question of law is raised, and that is the competency of Drs. Kimbro and Spivey to testify as witnesses, it being insisted that their testimony was inadmissible under § 4149,' C. & M. Digest, which provides that “no person authorized to practice physic or surgery * * * shall be compelled to disclose any information which he may have acquired from his patient while attending him in a professional character, and which information was necessary to enable him to prescribe as a physician or (do) any act for him as a surgeon * *

Drs. Kimbro and Spivey both testified that the opinions expressed by them were based upon information obtained while waiting on the insured in a professional capacity.

The- objection to the admissibility of this testimony may be disposed of by saying that in the “application for membership and participation in the beneficiary fund” made by the insured, appears this statement: “I further waive for myself and beneficiaries the privileges and benefits of any and all laws which are now in force or may hereafter "be enacted in regard to disqualifying any physician from testifying concerning any information obtained by him in a professional capacity.”

In the case of National Annuity Assn. v. McCall, 103 Ark. 201, 146 S. W. 125, 48 L. R. A. (N. S.) 418, Dr. Pringle testified that he had attended the insured, whose death was there in question, before and at the time of his death, as his family physician, and in this way acquired information as to the cause of the insured’s death, which he thought he should not disclose. The court refused to require the witness to answer, upon the ground that this information was privileged under the statute referred to. In holding that there was error in refusing to permit the witness to state from what cause the insured had died, inasmuch as the application had waived the benefit of the statute, it was here said:

“This statute accords the privilege to a patient of objecting to disclosures of matters communicated to or information obtained by a physician as such, and this privilege does not cease with the death of the patient. But this privilege may .be waived by the patient himself and after his death by his representative; and so, tó'o, where one occupies á relation to the deceased by reason of a contract, such as is involved in this case, wherein he is made the beneficiary of a life insurance policy, he has, by virtue of this statute, a right to object to testimony relative to the communications therein' named as privileged, and he has also the right to waive this privilege conferred by it. 4 Wigmore on Evidence, $ 2387; Penn Mut. Life Ins. Co. v. Wiler, 100 Ind. 92, 50 Am. Rep. 769. A person may also,, in his written application for insurance, waive the right to object to the testimony of a physician as to information acquired while attending as such.”

The testimony of Drs. Kimibro and Spivey was therefore competent, and, as the finding of the court below does not appear to be contrary to the preponderance of the testimony, the decree must be affirmed, and it is so ordered.


text:
    Lepanto Special School District v. Cone.
    Opinion delivered April 23, 1928.
    States — validity of appropriation. — Acts 1927, p. 355, • providing that the State Auditor could, upon receipt of certificate- that taxes heretofore or hereafter assessed for support of any special or rural special school district, had been paid erroneously, draw a warrant for the amount to he paid out of the appropriated school fund, held void for failure to make a specific appropriation out of which to pay a warrant in accordance with Const, art. 5, § 29, providing that no money shall be drawn from the treasury except in pursuance of specific appropriation made by law, the maximum amount of which shall he specified in dollars and cents.
    Appeal from Pulaski Circuit Court, Second Division; Bichard M. Mann, Judge;
    affirmed.

      R. H. Dudley and J. F. Gautney, for appellant.

      Hal L. Norwood, Assistant Attorney General, for appellee.
   Humphreys, J.

Tliis -suit was brought in the Second Division of Pulaski County Circuit Court by appellant against appellee to compel him to issue a warrant in the sum of $13,861.42 in its favor upon the Treasury of the State, payable out of the unappropriated school funds, under authority of .act No. 117 of the General Assembly of 1927. The .act provided that:

“Whenever it shall be made to appear by the certificate of the treasurer of any county of this State that taxes heretofore or hereafter assessed by said Tax Commission or Tax Board for the support of any special or rural special school district in this. State, or any part thereof, have been erroneously paid to and received by any other school district than that to which it was payable under such assessment, it is hereby made the duty of the State Auditor, upon the receipt of such certificate of the treasurer of any county, describing the property assessed for the benefit of any special school district or rural special school district,' and the amount of taxes assessed therein, that have been erroneously paid to and received by any school district other than that to which it was properly payable, to draw his warrant on the Treasurer of the State of Arkansas, payable to the special school district or rural special school district, for the amount of said taxes so .erroneously paid. This act to apply to and cover all erroneous payments heretofore made as well as. erroneous payments hereafter made. That, for the purpose of carrying out the purposes of this act, the State Treasurer shall pay said warrant out of the unappropriated school fund of the State of Arkansas.”

It was alleged, in substance, in the complaint that, for the years 1913 to 1914 inclusive, taxes in the sum of $13,861.42 were collected on properties of certain public utilities within the boundaries of appellant district for school purposes and erroneously paid to Marked Tree Special School District, and by it expended for educational purposes; that, pursuant to the provisions of said act, it obtained the required certificate of the county treasurer and presented same to appellee in order that he might draw his warrant on the State Treasury, payable to appellant, for the amount of taxes belonging to it which were erroneously paid to said Marked Tree Special School District and by it expended in conducting its school; that appellee refused to issue the warrant.

The prayer of the complaint was for a writ of mandamus commanding appellee, as Auditor of State, to issue the warrant.

Appellee filed the following demurrer, omitting caption and signature, to the complaint:

“(1) The facts alleged do not constitute a cause of action. • (2) Act No. 117 of the Acts of the G-eneral Assembly of the State of Arkansas for the year 1927 is in conflict with article 16, § 11, of the Constitution, which provides that moneys arising from a tax levied for one purpose shall not be used for any other purpose. (3) The said act does not comply with article 5, § 29, of the Constitution, which provides that Mo money should be drawn from the Treasury except in pursuance of specific appropriation made by law, the purpose of which shall be distinctly stated in the bill, and the máximum amount which may be drawn shall be specified in dollars and cents’.”

The court sustained the demurrer to the complaint, and appellant refused to plead further, whereupon the court dismissed its complaint, from which is this appeal.

Act No. 117 of the General Assembly of 1927, made the 'basis of appellant’s suit, is void for failure to make a specific appropriation out of which to pay the warrant, in accordance with article 5, § 29, of the Constitution of the State of Arkansas, which is as follows:

“No money shall be drawn from the treasury except in pursuance of specific appropriation made by law, the purpose of which shall be distinctly stated in the bill, and the maximum amount which may be drawn shall be specified in dollars and cents; and no appropriation shall be for a longer period than two years.”

The only attempted appropriation of funds out of which to pay said warrant which appellant is demanding that appellee issue is contained in § 3 of said act, which is as follows:

“That, for the purpose of carrying out the provision of this act, the State Treasurer shall pay said warrant out of the unappropriated school fund of the State of Arkansas.”

It will be observed that the maximum amount which may be drawn for the purpose mentioned was not specified. in dollars and cents. For aught that appears, the Auditor might be required to draw warrants in unlimited amounts for the purpose mentioned. This is inhibited by the Constitution of the State. The requirement in the Constitution is that all appropriations made out of the State Treasury for a special purpose shall state the maximum amount in dollars and cents that may be drawn out for such purpose.

Having* reached the conclusion that the act in question is void because indefinite as to the amount attempted to be appropriated for the purpose specified therein, it is unnecessary to decide the other interesting questions presented and ably argued by learned counsel in the case.

The judgment is affirmed.


author: Mehaffy, J.

text:
    First National Bank v. New England Securities Company.
    Opinion delivered April 23, 1928.
    1. Taxation — lien by payment op taxes. — Where a person pays taxes on land at the request of the owner and for his accommodation merely, no lien on such land as payment exists as against a mortgagee.
    2. Taxation — liability for taxes op person in possession. — Where a purchaser from a mortgagor iri possession of land was receiving the rents and profits, he was bound to pay the taxes, and could not enforce his lien for taxes as against the mortgagee.
    Appeal from Clay Chancery Court, Western District; J. M. Futrell, Chancellor;
    reversed in part.

      F. G. Taylor, for appellant.

      John L. Bledsoe and Bower sock, Fissell & Rhodes, for appellee.
   Mehaffy, J.

This action was begun by appellees on July 28,1926, in which action they sought to foreclose a second deed of trust executed to them by the defendant, George W. Transue, upon lands in the Western District of Clay Gounty, Arkansas. The appellant, First National Bank, intervened, and was made a party to the suit in October, 1926.

One of the defendants, S. P. Lindsey, filed answer, in which he alleged he had bought the lands embraced in the deed of trust at a trustee’s sale in bankruptcy, and that he was the owner of said land by virtue of a deed executed to him by the trustee in bankruptcy proceedings of George W. Transue; that said lands were sold under said bankruptcy proceedings, and defendant, Lindsey, became the purchaser, and received a deed, which was exhibited with the answer.

The only question involved in this appeal is whether or not the lien of appellant for. drainage assessments paid by it is prior and paramount to the lien of appellee’s deed of trust.

The deposition of S. P. Lindsey is substantially as follows: He was the active vice president of the First National Bank of Corning, .Arkansas. Had known George W. Transue about five years'. During the years of 1924 and 1925 witness was cashier of said bank, and, as such cashier, and on behalf of said bank, had some business with the defendant, Transue,- with reference to the lands described in plaintiff’s complaint. He testified that Transue asked them to look after the renting of said land, collecting of rents, pay the taxes, and look after it for him in general. Transite was absent from the lands and out of the county most of the time. Witness looked after the renting of the land, paid the taxes for him, and any work that needed to be looked after on the place, such as repairing the buildings and looking after the cutting of timber, was done by witness. The rents were applied -on Transue’s account and indebtedness that he owed the bank and to pay interest to the New England Securities Company. There was an agreement that these rents were to be applied on the account and previous debts. This agreement was part of the agreement, made at defendant’s request, that the bank should pay what is commonly called the drainage taxes, and all taxes which included the drainage taxes, and what was generally called State and county taxes. The receipts for the drainage taxes for the years 1924 and 1925 are correct, which the bank paid at the request of defendant, and each are made exhibits to deposition, and marked A and B. The bank paid the State and county taxes for the year 1924 in the sum of $21.38, and receipt is attached as exhibit to witness’ deposition. The bank has an assignment- of the lien of the Western Clay Drainage District. It is a lien made by the drainage board, and signed by D. Hopson, as president, for the drainage taxes for the years 1924 and 1925. The same are correct and are made exhibits D -and E to deposition. The amount for each was $215.

Witness purchased the land described in appellee’s complaint at a sale by the bankrupt court; received deed, copy of which is marked Exhibit F to deposition. -Witness took charge of said land under his deed January 1, 1926, and executed a mortgage on the rents of said land to Florence Jones,' and attached to witness’ deposition a copy of the mortgage made to Florence Jones.

Witness has $133.44, 1926 rents, to apply on the chattel crop mortgage, if he is permitted, to retain that, as he has not used any of it. It is witness’ intention to deduct the amount expended on the buildings on the farm, about $45, and apply the balance on the Florence Jones note. Mrs. Jones lives in Fayetteville, Arkansas. Since prior to. April 28, 1926, and up to the present time, witness has been solvent financially. Witness wrote a letter on the 10th of April, 1924, to George Transue, at Hoxie, Arkansas, with reference to paying the general taxes, in which letter he acknowledged having received letter from Transue, and he inclosed three checks, amounting to $21.62, for which he was given credit, and the letter stated that they would be glad to look after his taxes and use what scrip they could on them. But witness did not have the letter. Transue also requested verbally that witness look after the payment of his taxes, as Transue would be gone most of the year, and wanted the bank to look after the farm in general the same as if it was its own. Copies of two letters are attached to the deposition. Witness could hot state whether the State and county taxes for the year were paid on April 10, 1925, or at a subsequent date. Defendant gave instructions each year to pay the taxes, and was especially desirous that the ditch taxes be paid each year on account of avoiding a 25 per cent, penalty thereon. The assignment by D. Hopson, president of the Western Clay Drainage District, of a lien of said drainage district in favor of the First National Bank, was delivered to the bank a- week or ten days ago.

J. F. Arnold testified, in substance, as follows: He is 52 years old; a resident of Corning, Arkansas; is field-man for the First National Bank of Corning, Arkansas, and was acting as such during the years 1924 and 1925, and looked after the rental and collecting of rents on the land of defendant, George W. Transne. After making first rental contracts there was a tenant quit, and he had to get other men to take his place. On behalf of the bank, witness looked after collecting rents and the payment to the bank by renters, and getting the crops gathered. Defendant asked witness to see that the tenants were getting along properly, and that they turned in their rent to the bank, and to see that Lindsey did not let his taxes go delinquent, as there was a heavy penalty if the taxes were not paid when due, and witness did that, in accordance with his request and that of the bank. Witness does not know what the rents amounted to, as his business was to see that the tenants left it at the bank, and he kept no record of the amount of either year.

Exhibits mentioned by witness were then introduced, and witness continued. Another exhibit is a letter of Lindsey, cashier, to George W. Transue, dated Corning, April 24, 1924, which is substantially as follows:

“Your letter received regarding the Boulton order for clearing, of which Mr. 'Boulton was not claiming that you gave him an order for the clearing to the amount of $20, which he claims that you had arranged with him to have the clearing done, and you having arranged with us to look after your farm as to renting- it as well as all other matters pertaining to the farm, we of course did not want to pay him anything for something that we knew nothing about, nor had hired him to do any clearing. Mr. Smith was telling me that the officers had posted some kind of a notice on the door of the dwelling on the farm that was in reference to some kind of suit as to the sale of your property. Not knowing anything about the nature of the notice, we notified you, so that you could see about the matter in the event that we could not look after it for you.”

Another letter from defendant, Transue, was in substance as follows:

“Don’t you think you should send Fred Arnold to see Smith, Sprouse and Story and hurry them up on the cotton job? Don’t forget to pay John Smith for oats and John Sprouse $15 for the corn. I am afraid my lawyer is assisting S. A. Foster at Walnut Ridge to beat me out of the cow you have a mortgage on. Will you write him and tell him not to sell the cow and calf, as you have a mortgage on her and the calf ? ’ ’

Another letter, dated November '20, 1925, to the defendant, Transue, was in substance as follows:

“We have your letter of the 18th, stating that we should send Fred to look after Smith and Sprouse in reference to getting out their crops. Wish to advise that Mr. Arnold has been looking after the matter, as you asked us early in the spring to look after your farm as to renting it and such other matters in reference to the welfare of the farm, hence we have been giving it our attention as your agent, collecting the rents and placing such credit on your account — paid your ditch taxes and general taxes for the year 1924 — and still carrying the receipts as having been paid for you as your agent, and trust that you can arrange for them the close of the year, as you will have the ditch taxes for 1925 due this coming December, and we will also look after them for you the same as we have other taxes paid on your farm in general. It is slow getting out cotton on account of continued rains, and the tenants advise us that most they have got out they have had to mud-boat it out. I am writing Mr. Forest at Walnut Ridge in reference to the cow. We have rented all of the farm for the coming year to W. M. Smith, as we think we can handle the entire place better than having several parties on it, which has caused more or lefw» contention this year among the tenants.”

The record of Western Clay Drainage District, subdivision 5, was introduced, showing the assessment on the lands.

The chancellor entered a decree to the effect that the plaintiffs, New England Securities Company, have a judgment in rem against the defendants for the sum of $357, with interest at the rate of 8 per cent, from February 8, 1923, which judgment is secondary only to that of First National Bank in the sum of $21.38, together with the interest at 10 per cent. The intervener, First National Bank, excepted to the finding of the decree of the court, and prayed an appeal to the Supreme Court, which was granted. The appellee has been granted a cross-appeal, and asks a reversal of that part of the decree declaring a lien for taxes of $21.38 prior to its mortgage lien.

The appellant in its intervention .states that the defendant, George W. Traiisue, transferred to it the possession, care and control of the lands described in appellee’s deed of trust, and authorized and requested appellees to pay the taxes and drainage assessments upon said lands, and to rent and collect the rents and account to him for same. The bank was therefore in possession of the land, receiving the rents and profits under an agreement with the owner to pay the taxes. It was the owner’s duty to pay the taxes. And the bank, being in possession under a contract with the owner, as alleged by it, to pay the taxes and to collect the rents, was bound under the law and its contract with the owner to pay the taxes, and its payment was a payment for the owner.

It is the contention of the appellant that “one who pays the debt of another 'by request of the other, which debt is a lien on property, real or personal, has a lien on the property for the amount paid.”

It is unnecessary to determine here whether, as between the owner of the land and the appellant, it did, under the contract between the parties, have a lien on the property. The controversy here is between the appellant and the mortgagee. The appellant was under no obligation whatever to pay the taxes.

“When taxes are paid on another’s land under such circumstances as to give a right of recovery for the taxes paid, as set forth in the preceding section, the person making the payment will have an equitable lien on the premises for the amount so paid, or, according to the doctrine prevailing in some jurisdictions, will be subrogated to the lien of the State or municipality. But no such lien exists where the payment was voluntary, in the legal sense, or was made at the request of the owner and for his mere accommodation. Nor can this lien be made effective against a subsequent purchaser from the real owner, who had no notice of the circumstances under which the taxes were paid.” 37 Cyc. 1154.

' According to appellant’s own statement, the taxes were paid by it at the request of the owner and for his mere accommodation. And therefore no such lien exists, especially as against the mortgagee.

This court said in a recent case: “Where one is in possession, receiving rents and profits from mortgaged property, he has money received from the property itself with which to pay the taxes, and it has been held that, under such circumstances, he owes the duty to pay the taxes.” Security Mortgage Co. v. Harrison, 176 Ark. 423, 3 S. W. (2d.) 59; Cotton v. White, 131 Ark. 273, 199 S. W. 116.

“It is not disclosed by the record that the claim probated by appellant for taxes was for taxes paid by him during the time he occupied the premises. His occupancy was reimbursement for the payment of the taxes.” Beverly v. Nance, 145 Ark. 589, 224 S. W. 956.

The appellant was not only in possession, receiving the rents and profits, but the proof in this case shows that it actually received as rent for the year 1924 $231.16, and for the year 1925 $199.52, making a total of $430.68, a few cents more than the improvement taxes amounted to. In all these transactions the bank was represented by Mr. S. P. Lindsey, the active vice president of .the First National Bank. And he finally became the purchaser of the property. If the taxes were a lien, they were a lien on the land, and appellant’s first vice president purchased the land. The appellant, receiving the rents and profits under the contract alleged in this case, was bound to pay the taxes. Instead of doing that, it used the money received for rent to pay a private debt due itself, and then seeks to enforce a lien for the taxes that it paid. As it was in possession of the property, under contract to receive the rents and profits and pay the taxes, it could not use the rents and profits to pay a private debt to itself and then claim a lien on the land as against the mortgagee for the taxes paid.

We do not think the sections of the Digest referred to and discussed have any application.

It follows from what we have said that the case must be affirmed on appeal and reversed on cross-appeal. The case will therefore be affirmed on appeal and reversed ana remanded on cross-appeal, with directions to enter a decree making the judgment of the New England Securities Company a lien on the land prior and superior to the lien of the First National Bank.