author: Smith, J.

text:
    Camp v. Barr.
    Opinion delivered June 2, 1930.

      Alonso D. Gamp and 0. A. Graves and E. F. Me-Vaddin, for appellants.

      L. F. Monroe, for appellees.
   Smith, J.

In this case three different sets of school directors are assuming- to act as directors of Patmos Special School District in Hempstead Cqunty, and the purpose of this litigation is to determine which set has lawful authority to act.

Prior to February 12, 1930, there were four school districts in the southern part of Hempstead County, known as Patmos Special School District, Rural Special School District No. 3, Rural Special School District No. 8, and Rural Special School District No. 15. On February 12, 1930, the county board of education of that county, acting upon the petitions of a majority of the qualified electors in the territory to be affected, made an order which combined all these districts under the name of the Patmos Special School District, and the question in the case on this appeal is whether these districts were consolidated, or whether districts numbered 3, 8 and 15 were dissolved and attached to Patmos Special School District.

It appears that the consolidation movement was inaugurated by the directors of districts 3, 8 and 15, but before the petitions for the consolidation were prepared or circulated it was agreed that the Patmos district might also be included, and the following petition was circulated and signed by the required number of electors:

“To the Board of Education of Hempstead County:
“We, the undersigned, a majority of the qualified electors in the territory to be affected, respectfully petition your honorable board to change the boundary lines of Patmos Special School District in Hempstead County, Arkansas, so as to include the territorjr now in Rural Special School Districts Numbered Three (3), Eight (8) and Fifteen (15) in Hempstead County; and that said territory now incorporated in said Rural Special School Districts Numbered Three (3), Eight (8) and Fifteen (15) be annexed to and made part of the said Patmos Special School District. ’ ’

Upon this petition the board of education made the following order:

“It is therefore considered, ordered and adjudged by the county board of education of Hempstead County, Arkansas, that the - prayer of this petition be, and the same is, hereby granted, and that boundary lines of the said Patmos Special School District be, and the same are hereby so changed and extended as to include the said Rural Special School Districts, Numbers Three, Eight and Fifteen, and that the said Rural Special School Districts be, and the same are hereby dissolved, and all the territory thereof be attached to and made part of Patmos Special School District of Hempstead County, Arkansas; and that all funds belonging to the said Rural Special School Districts Numbers Three, Eight and Fifteen be transferred to and become the property of the said Pat-mos Special School District, and that all the property belonging to said Rural Special Districts Numbers Three, Eight and Fifteen become by this order the property of the said Patmos Special School District; and that the said Patmos- Special School District assume and pay all indebtedness of said Rural Special School Districts Numbers Three, Eight and Fifteen; and that the directors of the said Rural Special School Districts Numbers Three, Eight and Fifteen transmit without delay all rec7 ords of said districts to the County Superintendent of Hempstead County, Arkansas, for preservation in his office; and that copies of this finding and order be filed with the county clerk and the county treasurer of Hemp-stead County, Arkansas.”

At the time this order was made the opinion of this court had not been delivered in the case of Special School District No. 60 v. Special School District No. 2, ante p. 253, and there was uncertainty as to who constituted the -board of directors of the new district. There appears to have been an agreement made, after the board of education had entered the order set out above, that four of the directors of the original Patmos district should resign, and the remaining two should select four directors residing in the territory of the other districts. It does not appear that the four directors resigned, as it had been agreed they should do, but their successors were appointed and undertook to qualify by taking* the oath of office, and these persons compose a board referred to in the record as the New Patmos Board.

The directors of the old Patmos board took the position that the other districts had -been annexed, and that they were the directors of the new board. The directors of the other districts took the po-sition that there had been a consolidation of the districts, and that the directors of all the districts composed the new board of directors for the consolidated district and were entitled to serve as such until a new board could be elected, and this suit was brought by them to prevent the old and the new Patmos boards from interfering with them.

The chancellor was of the opinion that the case of Special School District No. 60 v. Special School District No. 2, ante p. 253, applied to the facts of this case, and upon the authority of that case held that there had been a consolidation of the four districts, and granted the relief prayed, and both the old and new Patmos boards have appealed.

At the trial from which this appeal comes there was offered in evidence, without objection, a certified copy of the petition upon which the county board of education in Nevada County had made the order involved on the appeal in the case of Special School District No. 60 v. Special School District No. 2, supra, the prayer of which was that “the above described territory, being all the land now included in district No. 1 and district No. 60, which districts and which territory we respectfully ask to be annexed and become a part of said district No. 2 in Nevada County.” Upon this petition the county board of education of Nevada made an order granting the prayer of the petition, extending the “boundaries of school district No. 2 to include school districts Nos. 1 and 60.”

In the case cited we construed this order as being an order of consolidation, and held, that under § 8847, C. & M. Digest, “the consolidated school district would <be governed by a board of directors composed of all of the directors of the several school districts entering’ into' the consolidation” until the next regular school election.

It thus appears that the facts in the two. cases are practically identical, and we perceive no reason why we should not hold, with the chancellor, that the instant case is controlled by the former opinion.

It is earnestly insisted that this holding is in conflict with the opinion in the case of Manley v. Moon, 177 Ark. 260; but we do not think so. The point decided in that case was that act 156 of the Acts of 1927, page 549, authorizing the county board of education to change the boundaries between any existing school districts, left to the board a discretion in changing the boundaries, whether to do so by consolidation or otherwise.

There was no change of boundaries here except to consolidate four districts into one, and it is immaterial that the consolidated district took the name of one of the districts consolidated. The effect of the order of the board of education was to consolidate the four districts, and, upon this being- done, the directors of all the districts became the directors of the consolidated district, with authority to serve until the next school election, when the new board would be elected. This is the effect of the Nevada County case, supra, and, as we think it applies here, the decree of the chancery court, which conforms thereto, must be affirmed, and it is so ordered.


source: Caselaw Access Project

author: Humphreys, J.

license: Public Domain

text:
    Drew County Bank & Trust Company v. Sorben.
    Opinion delivered June 2, 1930.

      Williamson <& Williamson, for appellant.

      A. J. Johnson, for appellees.
   Humphreys, J.

The question-presented for determination by this appeal is whether appellant’s mortgage for $400 executed to it on January 4,1927, by L, M. Stratton and E. C. Stratton on the south half, southeast quarter, section 21, and the southeast quarter, southwest quarter, section 22, all in township 10 south, rang*e 7 west, in Lincoln County, Arkansas, containing 120 acres of land, is paramount to appellees’ mortgage executed to them on the 25th day of March, 1925, for $405.39 by the same mortgagees on the south half, southeast quarter, section 21 and southwest quarter, southwest quarter, section 22 in said township and county, containing 120 acres.

Appellant’s mortgage was acknowledged in statutory form and filed for record on January 6, 1927; and appel-lees’ mortgage was not acknowledged in statutory form, but notwithstanding was filed for record on November 7, 1925.

The trial court ruled that appellees’ mortgage lien was superior to that of appellant’s on all the lapd described in appellees’ mortgage, because their mortgage was filed for record prior to appellant’s mortgage. This ruling of the court would have been correct, had appel-lees’ mortgage been acknowledged in accordance with the statute in Arkansas governing acknowledgments. The acknowledgment, however, was fatally defective because it failed to state that the mortgage was executed “for the consideration and purposes therein mentioned and set forth,” as required by § 1521 of Crawford & Moses’ Digest. In construing- said section of the statute, this court said, in the cases of Johnson v. Godden, 33 Ark. 600, and Wright v. Graham, 42 Ark. 141, that the words “consideration” and “purposes,” or words of similar import, are material and must appear in an acknowledgment in order to give any validity to an instrument for the conveyance of real estate as far as third parties are concerned. A mortgage of real estate is not entitled to record under § 7380 of Craiwford & Moses’ Digest until properly acknowledged, and, when properly acknowledged, does not become a lien under § 7381 of Crawford & Moses’ Digest on the mortgaged real estate as to third parties until fded in the recorder’s office for record in the county where the real estate is situated. According to the statute, the lien attaches to the real estate described in the mortgage at the time of filing, and thenceforth is notice to all persons of the existence of such mortgage.

In the instant case the record reflects that appellees’ mortgage was insufficiently acknowledged because the acknowledgment omitted the words “consideration” and “purposes,” or words of similar import and, on account of the fatal defect in the acknowledgment, was illegally admitted to record. The record thereof constituted no notice to third parties of the existence of the mortgage. Appellant’s mortgage, under the statutes and decisions referred to, was and is paramount to appellees’ mortgage, although executed and filed for record subsequent to appellees’ mortgage, so far as the mortgages cover the same real estate. Both mortgages cover the eig’hty-aere tract described as the south half, southeast quarter section 21, township 10 south, range 7 west, in said county, but do not cover the same forty-acre tract. As to the eighty-acre tract appellant’s mortgage was and is paramount to that of appellees ’ mortgage; as to the forty-acre tract described in appellees’ mortgage as the southwest quarter, southwest quarter, in said section, township and range and not described at all in appellant’s mortgage, appellees’ mortgage lien was and is paramount to appellant’s. The reason is that as to the forty-acre tract appellant gained no priority of lien over appellees by reason of recording its mortgage. It had no mortgage lien on said forty-acre tract and obtained none by recording its mortgage. It is true that the record reflects that the intention was to include the southwest quarter, southwest quarter, of said section, township and range, but such intention did not avail to establish, precedence between mortgages that gained precedence under the statute by virtue of priority in filing same for record. The issue as to priority of the mortgages was joined and the rights of the parties fixed before an attempt was made to reform appellant’s mortgage so as to correctly describe the forty-acre tract in question. Even a reformation of appellant’s mortgage would not relate back to the date same was recorded so as to bind or affect third parties. It follows that the decree must be reversed in so far as it declares appellees’ mortgage lien paramount to appellant’s on the south half, southeast quarter, of said section, township and range and remanded with directions to declare appellant’s lien paramount to appellees’ on said eighty-acre tract, which is accordingly done. In all other respects the decree is affirmed.


author: Mehaeey, J.

text:
    Federal Compress & Warehouse Company v. Parrott.
    Opinion delivered June 9, 1930.

      Dudley & Dudley, for appellant.

      Richardson ■& Richardson, PL. L. Ponder and Smith é Blackford, for appellee.
   Mehaeey, J.

Appellee brought suit in the Lawrence Circuit Court to recover damages for an injury received while in the employ of appellant.. The appellee was employed by the appellant as a tie man, but it was his duty to help load cotton on the oars and to do any work which he was directed to do. Appellant provided what it called a “gang plank,” onb end of which rested on the platform and the other end -was in the door of the car into which the cotton was being- loaded. This gang plank, which was iron, was about four feet long and three feet wide. The bale of cotton was placed on a truck and carried on said truck from the cotton shed or platform over the gang plank into the car. The gang plank slipped from the car door, causing appellee to fall and injuring him. It is alleged that appellant was negligent in not making the gang plank secure, and that this negligence was the cause of appellee’s injury. The appellant contends that the condition of the plank and the danger was obvious, and that appellee assumed the risk. The appellee and seven or eight other employees of appellant were loading bales of cotton, conveying- the cotton from the warehouse to the car on trucks. Each truck carried one bale. The appel-lee testified that it was the duty of the oar man to fasten the gang plank, and that it was not his duty to inspect it. There is evidence tending to show that one of the loaders Avould place the gang plank and also evidence tending to show that the plank should have been nailed. The undisputed evidence shows that some one other than appellee had placed the plank, and it was done before appellee began work at this place. Appellee worked at another place in the forenoon tying- cotton. They were loading the car when appellee went there to work. The undisputed evidence shows that the plank had been placed and employees were loading the cotton on the car when appellee went there to work. He had no opportunity to inspect-the plank or to find out whether it was securely fastened or not. One truck was immediately behind another, and there were seven or eight engaged in loading the cotton. If the plank had been securely fastened, it would not have fallen. All the witnesses testify that, if it was raining or damp, or if the oar door was higher or lower than the platform, it was necessary to nail the gang’ plank. The evidence is in conflict as to whether the car door was higher than the platform. If it was higher, the gang plank should have been nailed to prevent it from slipping. The undisputed evidence shows it was not nailed. Appellant contends earnestly that the condition and danger was obvious, and that appellee assumed the risk.

Attention is called to many decisions of this court discussing the question of assumed risk and holding that where the clanger arising from the negligence of the master is so apparent and obvious in its nature as to be at once discoverable to one of ordinary intelligence, an employee, ‘by voluntarily undertaking to perform the work, assumes the hazards which exempt the employer from liability on account of injury to the employee. A servant assumes the usual and ordinary risks and dangers incident to his employment, but he does not assume the risk of injury from the negligence of his master or his fellow servants, unless he knows of the risk or unless the risk is open and obvious.

In this case the gang plank was not fastened or nailed, and both appellant’s and appellee’s witnesses say this is necessary unless the car door and platform are level with each other. The evidence on this question is not very strong, but there was sufficient evidence to submit the question to the jury.

The evidence shows clearly that the appellee worked tying cotton in the forenoon, and that when he got to the place where they were loading there were several others using trucks, and he was asked the question: ■ “Did you know it was not fastened until it fell?” A. “No, sir, 1 did not.” Q. “Was there anything there plain to you that you could see by looking that it was not fastened?” A. “No, sir, because when we went to work we grabbed up the trucks and just went at it. This car man, that is his place to always fasten the stage everywhere that I have worked.” From the evidence in: this case it appears that the appellee had no opportunity to inspect and determine whether the gang plank was nailed or not, hut he went to work immediately when he got to the place, and the plank fell with him when he had put in the second bale of cotton. The car was already practically full. A servant has a right to assume that the master has performed its duty. He has a right to assume that his fellow servants have performed their duty. Of course, if he had known that the gang plank was insecure and proceeded with his work, he would have been held to assume the risk, but there was no duty on him to inspect for the purpose of ascertaining whether or not somebody had been guilty of negligence. The negligence and danger was not obvious, and there is no assumption of risk by the servant of danger arising from the negligence of the master or his fellow servants, unless the risk and danger are open and obvious or unless he knows they exist. Ark. Land & Lbr. Co. v. Fitzhugh, 143 Ark. 122, 219 S. W. 1022; Southern Cotton Oil Co. v. Spotts, 77 Ark. 458, 92 S. W. 249; St. L. I. M. & S. R. Co. v. Birch, 89 Ark. 424, 117 S. W. 243; Aluminum Co. of North America v. Ramsey, 89 Ark. 522, 117 S. W. 568; A. L. Clark Lbr. Co. v. Northcutt, 95 Ark. 291, 129 S. W. 88; C. R. I. & P. Ry. Co. v. Smith, 107 Ark. 512, 156 S. W. 166; Mosley v. Mohawk Lbr. Co., 122 Ark. 227; 183 S. W. 187; Central Coal & Coke Co. v. Fitzgerald, 146 Ark. 109, 225 S. W. 433; Arkansas Cent. Ry. Co. v. Jackson, 70 Ark. 295, 67 S. W. 757; Wisconsin & Ark. Lbr. Co. v. Otts, 178 Ark. 283, 10 S. W. (2d) 364.

Appellant also contends that the court erred in referring to the amount sued for. 'While this court has said it is unnecessary and improper for the trial court to make reference in. an instruction to the amount sued for in the complaint, it has also said that where the instruction containing reference to the amount sued for also contains a direction to find only such amount as the evidence warrants, the giving of such instruction is not reversible error. It could not have been prejudicial in this case because the court instructed the jury that it would assess appellee’s damages at such a sum as it believed from a preponderance of the evidence would reasonably compensate him. The amount sued for was $3,000, and the verdict was for only one-fóurth the amount. St. L. I. M. & S. R. Co. v. Boyles, 78 Ark. 374, 95 S. W. 783; St. L. I. M. & S. R. Co. v. Snell, 82 Ark. 61, 100 S. W. 67; St. L. Sw. Ry. Co. v. Myzell, 87 Ark. 123, 112 S. W. 203; St. L. Sw. Ry. Co. v. Aydelotte, 128 Ark. 479, 194 S. W. 873; St. L. I. M. & S. R. Co. v. Holmes, 96 Ark. 339, 131 S. W. 692.

Appellant does not urge any other objection to instructions.

If the apron was left unfastened or insecure by reason of the negligence of the master or a fellow servant, plaintiff would not have to exercise care to ascertain whether the master had performed its duty. The question of the master’s negligence and the contributory negligence of the servant were questions of fact, and the jury has settled these questions against the appellant, and, while the evidence is not very strong, yet there is substantial evidence to support the verdict. This court does not pass upon the credibility of witnesses or the weight to be given to their testimony, and, as the verdict, of the jury is supported by substantial evidence, the judgment is affirmed.


text:
    Wells v. Farmers’ Bank & Trust Company.
    Opinion delivered June 9, 1930.

      TFcmZ £ Candle, for appellant.

      Robert. Bailey, for appellee.
   Smith, J.

Appellant filed an intervention in a suit brought by appellee, the Farmers’ Bank & Trust Company, hereinafter referred to as the bank, to foreclose a mortgage, and the bank filed a demurrer to the intervention, which was sustained, and, as appellant refused to plead further, the intervention was dismissed, and this appeal is from that order of the court.

The bank’s complaint alleged that on May 5, 1923, H. F. and J. F. Hays executed to it a mortgage to secure an indebtedness, which had not been paid, and a foreclosure of the mortgage was prayed.

In the intervention it was alleged that on December 6,1909, J. F. Hays and Anna L. Hays, his wife, procured a loan from intervener’s guardian in the sum of $1,700, which was evidenced by a note of that date, due one year later, which was secured by a mortgage on certain lots in the city of Russellville, which note had become her property. That the mortgage which the bank sought to foreclose was executed by J. F. Hays and his wife to secure an indebtedness then owing by their son, H. F. Hays, to the bank, which was then past due; that the suit of the bank to foreclose its mortgage was filed November 18, 1927, and the original intervention on December 2, 1927, and on December 2,1927, there was placed, upon the margin of the record of mortgages where intervener’s mortgage was recorded, the dates and amounts of payments each year upon said note, showing that the statute of limitations had not run against the note. That, after this notation had been placed upon the margin of the mortgage record, the bank abandoned its suit to foreclose its mortgage and took a deed from J. F. Hays and wife with full knowledge of the fact that said intervener had a valid subsisting lien upon the property, evidenced by the indorsement of the payments on her note, entered upon the margin of the record where said mortgage was recorded. That, during the pendency of the hank’s suit to foreclose its mortgage, not only upon the lands upon which intervener had a mortgage, but also upon other lands included in its mortgage, the bank voluntarily dismissed its suit and took a deed direct from J. F. Hays and his wife.

It was further alleged in the intervention that the cashier of the bank was fully advised, when its mortgage was taken, that intervener’s mortgage was outstanding and unpaid, and it was agreed, when the bank’s mortgage was taken, that intervener’s mortgage should be first paid, and that but for this representation J. F. Hays and his wife would not have executed the said mortgage to the bank.

It is our opinion that the demurrer to the intervention was properly sustáined. It alleges that the note given to intervener’s guardian, and now owned by her, was dated November 6, 1909, and due twelve months thereafter, and while payments were made thereon from time to time in a manner to keep the note alive as between the parties, no indorsement of these payments was made on the margin of the mortgage record until December 2,1927.

The mortgage securing appellant’s note had ceased to be a lien upon the land when the bank took its mortgage. Section 7382, C. & M. Digest, reads as follows:

“:No agreement for the extension of the date of maturity of the whole or any part of any debt or note secured by mortgag-e, deed of trust, or vendor’s lien, or for the renewal thereof, whether made in writing or otherwise, and no written or oral acknowledgment of indebtedness thereon, shall, so far as the same affects the rights of third parties, operate to revive said debts or extend the operation of the statute of limitations with reference thereto unless a memorandum showing such extension or renewal is indorsed on the margin of the record where such instrument is recorded, which indorsement shall be attested and dated by the clerk. * *

In construing this statute in the case of Morgan v. Kendrick, 91 Ark. 398, it was said: “The effect of that statute, as to strangers to the transaction, is that when the debt secured by a mortgage is apparently barred by limitation, and no payments which would stay the limitation are indorsed on the margin of the record of the mortgage, it becomes as to such third parties an unrecorded mortgage; and like an unrecorded mortgage it constitutes no lien upon the mortgaged property, as against such third party, notwithstanding he has actual knowledge of the execution of such mortgage. (Citing cases).” See also, Clark v. Lesser, 106 Ark. 207, 211. Merchants’ & Planters’ Bank v. Citizens’ Bank of Grady, 175 Ark. 417, 418.

Of the cases cited by appellant for the reversal of the decree from which this appeal comes, the one most nearly in point is that of Merchants’ & Planters’ Bank v. Citizens’ Bank of Grady, 175 Ark. 417. There it was held (to quote a headnote) that “where a first mortgagee and a second mortgagee agreed to extend their mortgages with the understanding that the first mortgage had priority, the second Inortgagee was estop-ped thereafter to assert that its mortgage had secured priority on the ground that the first mortgage had on the record apparently become barred by limitations, since the first mortgagee might have foreclosed its mortgage or have caused the mortgager to make a small payment and indorsed it on the margin of the record, thereby preserving priority of its mortgage.”

Just here is the distinction — and it is a controlling one — between the case cited and the instant case. There the mortgage was not barred when the agreement in regard to its extension was made. Here the intervener’s mortgage (except as between the parties thereto) had long been barred when the bank took its mortgage, which became, as against the bank, an unrecorded mortgage, and, like an unrecorded mortgage, did not constitute a lien upon the mortgaged property as against the bank, notwithstanding it liad actual knowledge, through its executive officers, of the existence of the intervener’s mortgage.

The mortgagors are not parties to this appeal, and we need not therefore consider the effect of the allegations of the intervention as to the agreement between them and the bank.

Under the allegations of the intervention the inter-vener’s mortgage had ceased to be a lien upon the property when the bank took its mortgage, and the demurrer was therefore properly sustained, and the decree is affirmed.


author: Butler, J. McHaney, J.

text:
    Fidelity & Deposit Company of Maryland v. Cunningham.
    Opinion delivered May 26, 1930.

      John A. Luhn, Chas. II. McComas, W. E. Beloate and Horace Chamberlin, for appellant.

      W. A. Cunningham and G. M. Gibson, for appellees.
   Butler, J.

For a history this case reference is made to the opinion in the case of Fidelity & Deposit Company of Maryland v. Cunningham, 177 Ark. 638, when the case was first here on appeal. There are 1,862 pages of typewritten matter in the transcript now before us, and the abstract and briefs of counsel contain 933 pages. With a record of this magnitude it is impracticable to do more than briefly review the most salient features of the testimony and only such as are necessary for an understanding of the points raised in this appeal, and this will be done as we proceed with the discussion of the questions involved.

On the first appeal this court held that the case should have been transferred to the chancery court. On remand, this was done, and a special master was appointed to take the testimony and make certain findings. The appellant challenges this appointment on the ground that the term of court had lapsed on the date of the appointment. It is unnecessary for us to determine whether or not the court was legally in session on July '23d, for to render the appointment of the master valid it is not necessary that the same be made on a day of the court. Crawford & Moses’ Digest, § 1364 (Act of April 16,1873, at which time the circuit court sat in chancery) provides that the clerk of the circuit court shall be ex-officio master or commissioner, and § 1365 provides that the “judge may appoint airy other person master or commissioner in special causes in said court.” Therefore, the appointment of a master by the judge in vacation would be a valid appointment.

It is contended also that the appointment was premature and too extensive. The objection interposed at the time of the appointment was not that it was premature, but for the reason that the court was not in session and that the order ivas coram non jiulice. We do not think that the appellant was shown any prejudice by reason of the premature appointment, if it was such, or the powers with which the master was clothed.

During the taking of the testimony the chancellor was called by the appellant to testify as to a certain matter, and for that reason his disqualification was suggested, which ivas overruled. This ivas a matter within the discretion of the chancellor. .Section 4193, Crawford & Moses’ Digest. We cannot see anything in the record which would warrant us in concluding that there was any abuse of discretion in the refusal of the judge to disqualify. The testimony given by him was entirely favorable to the appellant on the matter about which he was called, and the fact testified to by him might well have been proved without calling- him as a witness.

There are two main questions in this case. The first is presented by the appellant’s exceptions numbered 22, 31, 41, 45 and 46. By these the position is taken that the evidence demonstrated that the liability of the appellant on its bond was canceled by the conduct of the appellees. The second question is raised by exceptions 19, 20 and 23, where the contention is made that there was no embezzlement by Neil Cole of the funds coming into his hands as collector of revenue during the year 1926 for the taxes of 1925.

1. Neil Cole, as collector of revenue for Lawrence County, made the bond required by statute with the ap-pellees as bis sureties on the bond. The bond sued on was executed by the appellant to indemnify the appellees against any liability on their part as sureties for the larceny or embezzlement by 'Cole of any of the revenue collected by him. This bond imposed upon the assured, or any of them, the duty, on becoming aware of any act which -might be made the basis of any claim thereunder, to immediately give the insurer notice; and, further, that there should be no liability under the bond for any act of embezzlement or larceny committed by the principal after the assured, or either of them, should become aware of any act of Cole which might be made the basis of a claim. The execution of the bond avoided liability under the bond previously made. It is insisted that the appel-lees were well aware of these conditions which were identical with those of the previous bond executed by the appellant for their protection against the larceny or embezzlement by Cole for the collection of taxes for the year 1924 in the year 1925, and that at the time of the execution of the bond sued on the appellees knew that Cole had embezzled funds collected by him for the taxes of the year 1924; that after the execution of the bond the appellees knew that Cole was embezzling tax moneys collected for 1925 and applying the same to a private obligation of his own; that, knowing these facts, the ap-pellees, or any of them, failed to give any notice to the appellant company of such larceny and embezzlement within the time stipulated in the bond or at any other time, and that therefore the bond became void and unenforc-ifole. If the evidence established the facts contended, the position of the appellant would be well taken and there would be no liability.

There is but little conflict in the evidence. The dispute is not so much as to what the witnesses testify, but rather what are the proper inferences reasonably cle-clucible therefrom. The appellant contends that the cor-root inference establishes its contention while the ap-pellees insist that the true inference to be drawn is that the acts of Cole and the appellees am consistent with honesty of purpose and conduct.

Briefly stated, the facts are as follows: H. L. Ponder was the local agent for the appellant company in the city of Walnut Ridge. The bonds, and the one in suit, were all written on the application of Neil Cole and the favorable recommendation of Ponder, who was not only the local agent of the appellant, but also, a stockholder and officer in the Planters’ National Bank, a banking corporation doing business in said city. On a Sunday in August, 1924, the day before Mr. Cole’s settlement with the State for the taxes collected for the year 1924, he approached Mr. Ponder and informed him that he (Cole) lacked approximately $8,000 of having enough money with which to make his settlement, and stated as a reason that certain taxpayers, whose tax receipts had been issued and held by him on their promise to pay same in time for him to make his settlement, had failed to pay as promised. He requested Mr. Ponder to help him secure the money needed, and told Ponder at the time that he had certain collateral consisting of amounts due on the tax receipts before mentioned, notes due for automobiles sold, and county scrip. Ponder undertook to secure, if possible, the money needed, and on that afternoon interviewed the officials of the Planters’ National Bank, at which the understanding was reached that the bank would advance the money required. At that time Cole was in the automobile business, and had borrowed from the bank his limit under the rules governing the credit to be extended to any one of Cole’s business rating. Cole, on this account, procured three of his friends who undertook to, and did, execute to the bank three notes aggregating the sum required, which notes were indorsed by Clarence Whitlow, whose name made the risk acceptable to the bank. To secure Whitlow for the indorsement, Cole surrendered to him the unpaid tax receipts, the automobile notes and the county scrip, with the agreement that Whitlow should collect these and apply the proceeds to the payment of the three notes. This transaction was had early on the morning of the day on which Cole was to make his settlement, and the money or its equivalent was paid to him in time for him to catch the train to Little Rock. From these facts the conclusion is drawn that Cole was an embezzler of the 1924 revenue, and that Ponder and those of the appel-lees who were officers of the Planters’ National Bank were made aware of the same and aided him in concealing it; and further that subsequent facts demonstrated that Cole embezzled a part of the 1925 revenue with the knowledge and approbation of the officers of the Planters’ National Bank, and that the sums so embezzled were applied to the payment of the money procured by Cole to cover up his defalcation for the preceding year.

The evidence relied on to establish this last proposition may be thus stated: 'Clarence Whitlow was one of Cole’s deputies and he, with W. F. Rowsey, another deputy, were the ones designated to, and who did, carry the tax books through the county to make collections at the various voting precincts, after which the books were returned to the collector’s office, from which the taxes were collected for the balance of the time in which taxes were payable during the year 1926. On the flyleaf of one of the books carried around by the said deputies were various notations, among which was a series headed “Planters’ Bank,” showing deposits -made in said bank beginning January 9, 1926, continuing through that month and until February 11, 1926. These deposits aggregated approximately $4,318.88. Opposite each sum was the notation “on note.” The records of the Planters’ Bank disclosed that on or about the dates noted on the flyleaf there had been deposited by Clarence Whitlow like amounts whichyvvere applied as credits on the three notes executed the preceding August for the benefit of Neil Cole. The appellant draws the inference that these sums represented taxes collected, and that there was a diversion of these funds and a payment made with them to the personal obligation of 'Cole to the bank, evidenced by the notes of his three friends, which amounted to an embezzlement by -Cole of said funds, and that the appel-lees had knowledge of this. It was admitted by Whitlow that he did, in fact, pay those sums on the notes before mentioned, but he testified that these funds were not tax moneys but were collected by him while making his rounds as deputy tax collector from persons who had not paid Cole for the taxes of 1924 and from other collateral deposited with him when he indorsed the three notes, supra, and with these funds and money borrowed by him he discharged the same. The officer of the bank who received these deposits testified that he had no knowledge that they were 1925 taxes and assumed that they were not, but that they were collected by Whitlow from the said collateral.

It is further contended by the appellant that the evidence shows that H. L. Ponder, at about the time of the execution of the three accommodation notes, gave the bank to be used by 'Cole a check for $6,973.40, which he had in his possession. This check was one of the Missouri Pacific Railway Company, which had been sent to Ponder to pay a judgment against the railway company. The circumstances relied upon to support the appellant’s contention as to Ponder’s conduct aforesaid is that the bank handled this check through a Little Rock bank so that 'Cole, in fact, secured its proceeds with which to make his settlement. The evidence shows that Ponder deposited this check in the Planters’ National Bank, and was given credit for it on his account. The check was handled in the regular way by the bank, and, even though the proceeds of this check might have been given to Cole, the chancellor saw nothing unusual in the handling of this transaction. Nor do we. A witness testified that Ponder told him he had loaned Cole $.................. of the railroad’s money. This was disputed by Ponder, and it is undisputed that in due time Ponder paid the judgment, for the railway company.

To further support the first contention, appellant insists that Cole was overdrawn at the Lawrence County Bank in the sum of $2,702.41 from August, 1925, to January, 1926; that a number of the appellees who were officers of the Lawrence County Bank concealed this fact, and that it was their duty to acquaint the appellant of this overdraft at. and before the execution of the bond sued on, the inference being that said overdraft was a shortage and embezzlement of tax funds collected by Cole for the year 1924. The testimony of the cashier of said hank was to the effect that there was in fact no overdraft, but. the apparent, overdraft was caused by his failure to credit Cole’s account with the amount of certain tax receipts, and to charge the same to the account of Mr. J. Gf. Richardson, the president of the bank, whose tax receipts they were. As. a further fact tending to establish the guilty knowledge of the appellees as to the alleged defalcation of Cole, the appellant, endeavored to show that Cole’s collectors bond for the year 1925 covering the 1924 taxes was circulated by J. Gr. Richardson, president of the Lawrence County Bank, and sureties thereon solicited, and that at that time Richardson gave as an explanation of his interest in the matter that Cole was short in his accounts for the taxes previously collected, but that the sureties on the bond which he was then endeavoring to have made would be protected because an indemnity bond was to be obtained from the appellant company. At the time the testimony relative to this incident was given Richardson was dead, and the testimony was in conflict.

The bond in this case was executed at the request- of Cole and on the recommendation of Ponder. Ponder at that time had not been a surety on Cole’s previous bond which had also been executed by the appellant, company at- Ponder’s request, but later on Ponder did tiecome a surety on the 1926 bond. The evidence does not show that any one else among the sureties on Cole’s last bond in any way solicited the appellant to execute the bond involved in the instant case.

In order to absolve the appellant from liability on the contentions above made, two facts must have existed: first, that Neil Cole was an embezzler at the time of the execution of the bond in the instant case of a part of the 1924 revenue, or that, after the execution of the bond he embezzled a part of the ■ 1925 revenue and applied the last sums embezzled to the payment of the first; and, second, that the appellees were aware of such embezzle-ments and did not notify the appellant company of such fact. : ' . .. . - i

The effect of the finding and decree of the chancellor is that the evidence did not warrant a finding that either of the facts existed. The chancellor might have thought that the evidence showed merely an ill-considered confidence on the part of Cole,in others and negligence in the discharge of his duties, but not a moral delinquency, and that there was no circumstance to warrant the finding that the appellees, or any of them, if any embezzlement existed, knew of same or that the facts were sufficient to put them on inquiry. It is our opinion that the finding of the chancellor was not against a preponderance of the testimony, and that the provision in the bond requiring the appellant to be notified of any act which might be made the basis of any claim did not require any notice under the facts as found by the chancellor. Under the terms of a bond indemnifying the assured against the larceny or embezzlement of the principal and requiring notice by the assured to the insurer on their becoming aware of same, to render the notice necessary, more than mere suspicion is required; circumstances must have existed and been known by the assured, which would have induced the belief in an ordinarily prudent person that a larceny or embezzlement had been committed. American Surety Co. of N. Y. v. Pauly, 170 U. S. 133, 18 S. Ct. 552. As the appellant was not liable for any act of Cole short of embezzlement or larceny, it was unnecessary, under the terms of the bond, to notify the appellant of any negligence or unbusinesslike methods of Cole, although these might have ultimately created a condition causing larceny or embezzlement, where such negligence is not reasonably attributable to moral turpitude and dishonesty. Long Bros. Grocery Co. v. U. S. F. & G. Co., 130 Mo. Appeals 421, 110 S. W. 29; Pacific Fire Ins. Co. v. Pacific Surety Co., 93 Calif. 7, 28 Pac. 842; Gilbert v. State Ins. Co., 3 Kan. Appeals 1, 44 Pac. 442.

'2. The contention that Cole was not an embezzler of the revenue of 1925 rests also upon a question of fact. In the case of Fidelity & Deposit Co. v. Cunningham, supra, on evidence substantially the same as that in the instant case, this court held that the facts were sufficient to sustain the finding that Cole was an embezzler. It cannot be gainsaid that Cole did not collect large sums of the 1925 revenue for which he has not accounted or given any reason for not doing' so. There was a conference at which Cole, a number of the appellees, and the representatives of the appellant company were present at which conference the amount of Cole’s shortage was discussed, and it was approximated that at that time such shortage amounted to more than $30,000. There is some dispute as to what Cole’s admissions were during the conference, some of the witnesses stating that the agent for the appellant asked Cole if .he had embezzled this money, and that Cole answered in effect that he had. Other witnesses denied this, but it is practically undisputed that Cole admitted that he had spent the money — • if not all, at least a part of it. It is immaterial as to whether or not Cole admitted in so many words that he was an embezzler. The fact that he received the money in his official capacity and appropriated the whole or any part thereof to his own use for any purpose was sufficient to constitute the crime of embezzlement. Russell v. State, 112 Ark. 282, and cases there cited. We are of the opinion that the finding of. the trial court that Cole, the principal, had embezzled sums for which the appellant was liable under its bond was sustained by the evidence in the case.

3. The trial court, having found that Cole had embezzled the public revenue, and that the appellant was liable on its bond, the question next arises, what was the extent of this peculation and appellant’s liability? Appellant contends that Cole, the principal, and his sureties, the appellees, failed to furnish the data deemed necessary for a determination of the facts and that its motion for an audit of the accounts of Cole with the ten banks of Lawrence County was denied, and therefore it was unable to collect and present the facts to the court. The appellant’s motion for an audit was so sweeping in its terms that, if granted as requested, it would have given it the privilege to range at will through the records of these banks covering a period of four years, three of which were prior in time to the year covered by the bond. This motion was overruled, but an order was made for the production by Cole of all documents of every description relating to the “performance of his duties as tax collector” and to the banks to produce certified copies of all transactions had with Neil Cole in his individual capacity or as tax collector during the years 1923, 1924, 1925 and 1926, and that “they hold all originals of such accounts, books, papers and evidence subject to the inspection of the parties interested in this case under the personal supervision of the master at such times and places as he ma}7 designate.” This was a reasonable order, and if during the course of appellant’s investigation it might have deemed it necessary to examine any specific record or account, it might have so requested.

Cole and the banks complied substantially with this order, and appellant’s accountant proceeded from these documents and the public records to make an audit of the various transactions of Cole with the said banks, and stated an account showing the amount and extent of Cole’s liability. It does not appear that in the course of the audit any request was made for an examination of any particular book account or document, the appellant contenting itself with the request first made and resting on its objection and exception then saved. It appears that with the information furnished appellant’s accountant was enabled to, and did, make a comprehensive audit sufficient to convince appellant that there was no embezzlement, and that the appellees, in paying the alleged default to the State and improvement districts, had been overreached, and that the true amount really unaccounted for by Cole was negligible, to-wit, the sum of $2,235.94, whereas the appellees had paid to the State and improvement districts sums aggregating $30,843.20.- From the testimony and audit made by the accountant and the exhibits made by the banks of their records, able counsel has drawn the deduction that Cole had deposited much larger sums from revenues collected with the various banks than appeared credited to him on the accounts rendered, and that various items charged against him on his settlement had either not been collected or had been properly accounted for without corresponding credits, and that the net amount unaccounted for was the small sum before stated.

In conflict with the testimony and audit was the audit of an accountant furnished by the State Auditorial Department at the instance of the appellees, which accountant was later appointed by the master to complete the audit; also, the testimony of the cashiers of the several banks and the explanations made by them as to the true purport of certain deposit slips and other records which they testified appellant had misinterpreted. After hearing the evidence in the case, the trial court found against the contentions of the appellant as to the items properly charged to Cole and unaccounted for by him, and with slight modifications, sustained the findings of the master. Able counsel for the appellant has made a most searching and exhaustive analysis of the evidence and his deductions based on such and the attending circumstances are persuasive, but it is our opinion that the contrary conclusions reached by the trial court are supported by the preponderance of the evidence except as to two items. Respecting- these the evidence falls short in its probative force, and fails to establish an embezzlement on the part of Cole.

(a) On the 12th day of June, 1926, and continuing until the 23d day of September, 1926, there was on deposit in the Citizens’ Bank of Imboden to Cole’s credit as collector, the sum of $6,625.30, and in making- his last settlement Cole drew a check against this amount in favor of the State Treasurer for $5,526.08. This check was presented to the Bank of Imboden on a date prior to September 8, 1926, and payment was refused. The bank attempted to justify its action by saying- that Cole was indebted to the Lawrence County Road Improvement District in a sum equal to, or greater, than the amount of Cole’s deposit and for which a check had been drawn on July 12, 1926, and which had not been paid for the reason that it was drawn for a greater sum than Cole had in the bank at that time. It is admitted that Cole had paid the proper official of the road improvement district all of the revenue due it collected by him in 1926 for the year 1925, and the amount claimed as still due the Road Improvement District was for revenue due it for the year 1924. But it is also shown that on July 12th Cole drew a check in favor of the secretary of the Road Improvement District for the sum of $5,526.08, the amount claimed for the taxes unpaid for 1924 on the Bank of .Strawberry, and this check was duly paid. From this it appears doubtful if there were any back taxes due the improvement district on the date of the presentation of Cole’s check in favor of the State Treasurer, and, even if there were, we do not think that under the circumstances the People’s Bank of Imboden was justified in refusing- to pay the check in favor of the State Treasurer. It is singular that the alleged check of Cole in favor of the improvement district should have remained on file from July 12, 1926, until September 23 following'. Tbe naive explanation given by the cashier for not paying the cheek drawn in favor of the State was that “we would be doing a favor like for the Western Lawrence County Road District. They carried their money in our bank, and our money was very precious to us at that time, and, rather than pay out this $5,500 that would go to Little Rock, I took a chance of favoring- the road district in order to retain that deposit. ’ ’ The money in the People’s Bank of Imboden was for revenue collected for the year 1925, and, as Cole was endeavoring to make a proper payment to the State Treasurer, there was clearly no embezzlement of that fund because of the wrongful action of the bank, and therefore the appellant is not liable for this amount under the terms of its bond.

(b) On the 21st day of August, 1926, Neil Cole, as collector, drew his check on the Planters’ National Bank of Walnut Ridge, Arkansas, in favor of the secretary of the Black Spice Drainage District in the sum of $2,514.95. This check was deposited in the Bank of Alicia, and in the due course of business was transmitted to the First National Bank in St. Louis by which it was sent to the Lawrence County Bank, its correspondent. The check bears the indorsements “Lawrence County Bank, Walnut Ridge — Paid August 25, 1926,” and “Planters’ National 'Bank, Walnut Ridge, Arkansas-Paid August 26, 1926.” The check'was returned to the Bank of Alicia, and has attached to it a debit memorandum charging the check back to the drainage district. Accompanying the check was the alleged certificate of a notary public certifying that the check was presented to the Planters’ National Bank and payment refused because the account of Cole was closed. This certificate 'bears date of August '24, 1926. The individual whose name was signed to the protest as notary public testified that the same was a. forgery. The cashier of the Planters ’ National Bank testified that the account of Neil Cole as collector was closed'on August 25, 1926, and that its records do not show that this check had ever been handled by it. But there is no explanation given by the cashier or any one else as to why the check should have borne the customary indicia denoting payment, nor is there any •explanation given or attempted for the alleged protest or the forgery.

Tn view of these singular circumstances and the connotation implicit in the total failure to make any explanation regarding them, we are led to the conclusion that it cannot be said that the facts warranted a finding that this fund was embezzled by Cole, and that, while it is probable there is a mistake somewhere, it is equally as reasonable to assume that it was the mistake of someone else other than Cole, and that he should not be charged with having embezzled the amount of this check. Especially as at this time 'Cole’s extremity both with respect to his public liability and his personal obligations was beginning to be known, and it was then “let him save himself who can.”

4. Throughout the argument and brief of appellant are many exceptions to the conduct of the master and the rulings of the chancellor and to items of cost, allowed and his rulings on the matters raised by the appellant’s cross-complaint.. It is impracticable to review each of these, nor do we think a discussion of their merit would serve any useful purpose. Owing to the length of the record and the involved accounts contained therein, a correct consideration and determination of all the questions presented is most difficult. However, when due weight is given to the rulings and findings of the chancellor, we cannot say that his discretion has been abused, or that his findings are erroneous except in the particulars above mentioned. As to those, the decree will be modified, giving credit on the judgment for the sum of the two erroneous charges against Cole as to the Western Lawrence County Improvement District and the Black Spice Drainage District, and, as modified, the decree will be affirmed.

Kirby, J., dissents.

McHaney, J.

I dissent from the findings and conclusions of the court as to the two items last mentioned in the opinion. It is my opinion that the case should he affirmed as a whole, and not reversed in part.

Mr. Justice Humphreys agrees with me in this regard.


author: Hart, C. J.,

text:
    Merchants' & Farmers' Bank v. Reel.
    Opinion delivered June 9, 1930.

      Rays, Priddy d Rorex, for appellant.

      Robert Radley, for appellee.
   Hart, C. J.,

(after stating the facts). It is earnestly insisted that the deed to the one-acre tract of land on which the store and dwelling of Conner was situated should be set aside as being made in fraud of creditors. It is pointed out that the first two items of the indebtedness claimed by Reel to be owed him by Conner were barred by the statute of limitations. These were items claimed to be owed for the balance of wages for 1921 and 1922. In this contention, counsel for plaintiff are correct. The record shows that each year’s contract was separate in itself; and there was no account of debits and credits kept between the parties. Hence the balance due for the wages of each year constituted a separate indebtedness.

The record shows, however, that Conner owed Reel a balance of $175 at the end of 1926, $25 for the balance of wages at the end of 1921, and $300 for the balance due at the end of 1927. . These items aggregated the sum of $500. No testimony was introduced tending to contradict them, and the chancellor was justified in"finding that Conner owed Reel the sum of $500 at the time the deed to the one-acre tract of land was executed in September, 1927. The record also shows that the small store building and dwelling house on the land, together with the land itself, were not worth more than $500. It is true that the deed was not filed for record until after the death of Conner in April, 1928, but Reel testified that it was delivered to him on the date of its execution. It is also true that Reel was the son-in-law of Conner at the date of the execution of the deed and lived with Conner as a member of his family. Conner had been in bad health, however, and Reel and his wife lived with him for the purpose of taking care of him. Conner had tuberculosis and was not able to attend to his business for the last year of his life, and Reel ran the store for him. But, when all these matters are considered, we are of the opinion that the chancellor was justified in finding that the deed was not made in fraud of the rights of the creditors of Conner, and for that reason the decree in this respect will be affirmed.

The chancellor was also right in holding that the sale of the stock of goods and fixtures by Conner to Reel was void because it was made in violation of our bulk sales law, and that fraud must be conclusively presumed. Stuart v. Elkhorn Bank & Trust Co., 123 Ark. 285, 185 S. W. 263; Prins v. American Trust Co., 169 Ark. 455, 275 S. W. 714.

The chancellor erred, however, in allowing the exemption of Conner as a single man in the sum of $200 to be deducted from the value of the stock of goods. In Griffin v. Batterall Shoe Co., 137 Ark. 37, 207 S. W. 439, it was held that, under the bulk sales law, one who buys a stock of goods without giving notice to creditors as required by such act becomes a receiver and liable pro rata to creditors, although the sale was made in good faith. It was also held that, where a debtor’s personal property was 'worth more than $500, he must make a schedule of his property and specify the particular property he wishes exempted. Conner was indebted to the plaintiff at the time he executed the bill of sale and did not comply with the statute, and did not claim his exemptions when he transferred his stock of goods to Reel. Therefore, under the authority above cited, Reel cannot claim the exemptions for him in this suit.

For the reason that all of the amounts which Conner owed Reel were canceled in the purchase of the land in September, 1927, as above indicated, we are of the opinion that the only amounts which Reel could claim to be owing him at the death of Conner were the amounts which he had agreed to pay and did pay for his funeral expenses and to his creditors, which, as will be seen from our statement of facts,-amounts to $674.80. In addition, Reel claims that Conner was indebted to him in the sum of $25 a month for something over a year prior to the death of Conner for taking care of the latter. Reel admitted, however, that he kept no account of this and made no charge against Conner on his books. We are of the opinion that under the circumstances Reel and his wife lived with Conner as members of his family, and that all of them were supported o-ut of the store. Reel cannot be allowed any sum for the support and maintenance of Conner.

We are of the opinion that the balance in the bank, amounting to $225, which Conner gave by check to Reel on the day before his death, was given for the purpose of enabling Reel to apply it towards the payment of his debts, and that this money did not belong' to Reel.

The result of our views is that the deed from Conner to Reel will be allowed to stand, but that the personal property, including the stock of goods in the sum of $750 and the $225, balance of the bank account, amounting in the aggregate to $975, should be applied to the payment of Conner’s debts. As we have already seen, there are only two creditors, the plaintiff and Reel. According to the decision above cited, Reel will be deemed to have received these amounts to be applied pro rata towards the creditors of Conner, being the bank and himself. It follows that the decree sustaining the deed is valid and will be affirmed. In other respects, the decree will be reversed and the cause remanded with directions to the chancery court to distribute the funds in accordance with the directions of this opinion, and for other proceedings in accordance with the principles of equity.


author: Mehaeey, J.-

text:
    Berry v. Cousart Bayou Drainage District.
    Opinion delivered June 2, 1930.

      . Danaher & Danaher, for appellant.

      A. F. Triplett, for appellee.
   Mehaeey, J.-

Consart Bayou. Drainage District was created by special act No. 283 of the Acts of 1907, and at that time included land in Jefferson County only. The act creating the district was amended several times and includes land in Jefferson and Lincoln counties. Under the original act and amendments thereto, a system of drainage was constructed, assessment of benefits was made and bonds issued to pay for the improvement. The system is inadequate, and does not properly drain the lands within the district. The work provided for by the plans has been completed. In order to protect the system of drainage contemplated, the board of directors upon petition of real estate owners alleged to be a majority of those to be benefited by the proposed improvement, but not a majority in either number, acres or value of the owners of real property in the entire district, filed an application in the circuit court of Jefferson County, setting up the necessity for the proposed improvements describing the same and the plans for the construction of said improvement, and also describ-áis’ certain lands not within the district which would be benefited, and asking authority to include such lands within such drainage district. The application was made under § 4 of act 677 of the Acts of 1923. The board of directors complied with all the requirements of act 677 of the Acts of 1923. The circuit coiuh made an order annexing certain lands -which were adjacent on the west and north to the original boundaries of the district. After the circuit court made the order of annexation the board of directors of the district filed plans for the work, and an assessment was made of the benefits to accrue from the improvement. The assessment of benefits was not on the entire lands of the district, but was an additional assessment of benefits against the lands which the assessors found would be benefited bjr the proposed improvement. The assessment was made under special acts, and not under the provisions of the general drainage laws. The appellants began this suit alleging the things above recited, and that the district is planning to issue bonds and has levied a tax of three per centum for each of the years 1930 to 1944, inclusive,-upon the entire assessments in said drainage district including additional benefits assessed against the lands benefited, and that, in order to secure the payment of said bonds, the board is about to pledge the entire assessment of benefits against all lands in the drainage district; that plaintiffs are owners of a large quantity of land annexed by the order of the circuit court and also lands situated elsewhere in the drainage district; that some of the latter lands have not been assessed and some of them have; that defendants have no authority to do such additional work, and no authority to annex territory after the completion of improvements originally planned; that, in order to do such additional work, the petition must be signed by a majority in number or acres or value of all the owners of land within the entire district. There are a number of other allegations in the complaint, but we think the above is sufficient to present the issues. The answer denied the material allegations, and defendant also filed demurrer to plaintiff’s complaint which the court sustained, except with reference to the pledge of the entire assessment of benefits to secure the present issue of bonds, and dismissed the complaint for want of equity. This appeal is prosecuted to reverse this decree.

It is the contention of appellants that improvements and extensions of the kind contemplated here must be done, if at all, under the provisions of the general drainage law, while the appellee contends that authority exists under the provisions of special acts. Act No. 227 of the Acts of 1927 provides that all drainage districts created by special acts are made drainage districts under the terms of act No. 279 of the Acts of 1909, as amended with all powers conferred by said act No. 279, and with all liabilities and restrictions thereby imposed.

This court on April 28, 1930, in the case of Winton v. Bartlett, ante p. 669, held that act 227 of the Acts of 1927, is valid, and, among other things, said: “The act in question is a general law placing drainage districts, created by special acts with reference to procedure therein and thereafter, under the terms of the general law as provided in act No. 279 of the Acts of 1909, as incorporated in Crawford & Moses’ Digest in §§ 3607-56, inclusive.” Drainage districts created by special acts are now drainage districts under act 279 of the Acts of 1909 as amended.

The appellees, however, contend that the proviso in act No. 227 of the Acts of 1927 preserves its power and right to proceed in the same manner that it might have proceeded prior to the passage of act No. 227. The proviso reads as follows: “Provided, nothing in this act shall be construed as taking away from any improvement district created by special acts any powers which are thereby conferred upon it, nor shall it displace any commissioners or directors of such districts now in office. ’ ’

The question to be decided is whether the district can proceed to annex the property and make the improvement contemplated under the provisions of the special act or whether it must proceed under the provisions of the general drainage law. A decision of this question depends upon the construction of act '227 of the Acts of 1927. The primary rule in the construction of statutes is to ascertain and give effect to the intention of the Legislature. The intention and meaning of the Legislature must primarily be determined from the language of the statute itself. Howell v. Lamberson, 149 Ark. 183; Cowan v. Thompson, 178 Ark. 44; 25 R. C. L. 961.

The carrying out of the legislative intention is the prime and sole object of rules of construction. Significance and effect must, if possible, be given every part of the act. The court must view the whole and every part of the act taken and compared together. Section 1 of act 2'27 makes the drainage district a drainage district under the general drainage law “with all the powers conferred by the general law, and with all the liabilities and restrictions thereby imposed.” One of the powers conferred by the general law is the power to annex territory, as the district seeks to do in this, case, and one of the restrictions imposed is that the petition must be signed by a majority in numbers, acreage or value. Under act 203 of the Acts of 1927, the improvement may be made either before or after the completion of the plans for the work therein. It is true that the proviso in act 227 says that nothing in the act shall be construed as taking away from the improvement district created by special acts any powers which are thereby conferred upon it. When the whole act is considered, it is evident that the powers mentioned in the proviso means powers that are not inconsistent or in conflict with the general law. The general law confers the power to make the improvements contemplated by the district in this case. One of the recitals in the preamble shows clearly, we think, the intention of the Legislature. This recital is as follows: “Whereas the general drainage law, which appears as act No. 279 of the year 1909, furnishes an adequate uniform system for the operation of drainage districts.” It is manifest that the Legislature intended that the system for the operation of drainage districts should be uniform, and it therefore gave improvement districts created under special acts the powers conferred by the general law and imposed all the liabilities and restrictions of the general law. The powers mentioned in the proviso are, as we have said, those powers of the special districts not given by the general law. There is no necessary conflict in the provisions of the act, and, when construed as a whole, it provides a, uniform system for the operation of all drainage districts, and this was, we think, the intention of the Legislature. The court erred in dismissing the complaint. The decree is reversed, and the cause remanded with directions to take such further proceeding's as necessary, not inconsistent with this opinion.

Smith and McTIaney, JJ., dissenting.


author: Butler, J.

text:
    Sheeks v. Daugherty.
    Opinion delivered June 2, 1930.

      Ingraham cB Moher, for appellant.

      Joseph Morrison, for appellee.
   Butler, J.

The appellee, John Daugherty, brought suit against the First State Bank of Stuttgart, alleging that the bank had in its possession a warranty deed executed by Mrs. Katie Sheeks by which certain property in the city of Stuttgart was conveyed to him; that the deed was placed in escrow with the said bank to be held until the performance of a contract entered into between the said Mrs. Sheeks and appellee; that the terms of this contract had been complied with, and that appellee was entitled to delivery of said deed which the bank refused to deliver. The bank answered, and Mrs. Sheeks intervened.

The cause was tried on the following agreed statement of facts:

“That Homer Sheeks and his wife, Katie Sheeks, deeded the property involved in this lawsuit to Jake Irwin, by separate deeds, and Jake Irwin and his wife then reeonveyed to Katie Sheeks; that all of these conveyances were without valuable consideration. The deeds, duly recorded, are hereto attached and marked exhibits “A,” “B,” and “C,“ respectively. That on July 1, 1927, Katie Sheeks entered into a written contract with John Daugherty for the sale of the property involved in this lawsuit and authorized in said contract Homer Sheeks to be her agent to collect the payments due thereunder. The contract is attached hereto and marked exhibit “D.”
“That, on February 15,1928, Katie Sheeks deposited in the United States mail, under registered cover a notice addressed to John Daugherty, and same was received by him some time thereafter, notifying* him not 1 o pay Homer Sheeks any further payments under the contract, which is hereto attached marked exhibit “E.”
“That thereafter, John Daugherty sent by registered mail to Katie Sheeks his response, refusing to change the terms of the contract, a copy of his reply to her notice is hereto attached and marked exhibit “F,” and' rvas received by Katie Sheeks.
“On January 16, 1929, John Daugherty paid all of the notes to Homer Sheeks, amounting to $1,026, including interest. That the Arkansas Building & Loan Association is paid by..................and this mortgage is released of record.
“That Homer Sheeks paid no part of this sum, to-wit, $1,026, to Katie Sheeks.
“That at the time of the execution of the contract warranty deed to the premises was duly executed by Katie Sheeks and Homer Sheeks and with a copy of the contract placed in escrow in the First State Bank; that the First State Bank was served with a notice similar to the notice served upon John Daugherty, and, although, demand has been made upon the said bank, it now refuses to deliver the deed to either or any of the parties hereto; that all exhibits hereto are made a part of Jhis stipulation, the same as if they were copied in full in the body hereof. ’ ’

The letter from Daugherty to Mrs. Sheeks referred to in the above statement of facts as exhibit “F,” among other things stated: “At the time I bought this property, one of the material considerations for executing contract was that. I could pay Homer Sheeks and get my notes without difficulty or trouble. Inasmuch as you have decided to change the terms of the contract, which I feel will be a material change, and which were not stipulated at the time the contract was' executed, I do not care to acquiesce in such change and will therefore state to you frankly that I do not wish to carry out the contract in its changed form.

“I have paid the sum of $171 to the Arkansas Building & Loan Association since July 1, 1927. I have paid to Mr. Homer Sheeks, your agent, the sum. of $200 and have paid insurance in the sum of $15, and have expended the sum of $40 to have the house papered, making a total of $426.

“Kindly make arrangements to return the above amount to me by April 15, together with release from the contract, and my notes, and I will release to you the contract and instruct the bank to return the deed to you.”

The contract referred to in this letter was exhibit “B” to the agreed statement of facts, and was entered into the first day of July, 1927, by which Mrs. Sheeks agreed to sell and convey to Daugherty certain property described for which Daugherty agreed to pay the sum of $1,400 by assuming and paying the Arkansas Building & Loan Association of Little Rock the sum of $380, and the balance in cash to appellant, $200 of which to be paid on or before January 1, 1928, and the balance after the building and loan association should be paid, at the rate of $20 per month, the deferred payments bearing interest at the rate of eight per cent. Daugherty agreed to keep the premises insured, loss payable to Mrs. Sheeks as her interest might appear. It was agreed that, in default of the payment of the sums due the loan association, or in the balance of the payments, or in default of the payment of taxes or to keep the premises insured, Mrs. Sheeks might declare all of the indebtedness due and payable at once. It was also agreed that a copy of the contract with the deed to the premises should be placed in escrow with the First State Bank of Stuttgart, to be delivered to Daugherty upon the completion and fulfillment of his obligations. Embodied in the contract was the following statement: ‘ ‘ The party ef the first part hereby authorizes Homer Sheeks to accept payments and to receipt therefor to the party of the second part, the same as if paid direct to the party of the first part.”

Upon the execution of the contract, Daugherty took possession of the property and has retained possession until now. On February 15, 1928, Mrs. Sheeks sent from Mitchell, Indiana, the notice to John Daugherty referred to in the agreed statement of fact as exhibit “E.” In this notice attention was called to the contract and the provision therein authorizing Homer Sheeks to accept payments and to receipt therefor, and gave notice to Daugherty that she was canceling the authority of Homer Sheeks to receive payments of money or to receipt therefor, and directed Daugherty not to make any payments to any ether person except herself. He was also notified that he'was in arrears for the payment of the $200 due January 1, 1928, and attention was called to the acceleration clause in the contract and request was made for immediate payment directly to Mrs. Sheeks, advising that a copy of the cancellation of authority was mailed to Homer Sheeks and to the First State Bank of Stuttgart.

On March 28, Daugherty, writing from DeWitt, Arkansas, answered this by the letter referred to, supra, exhibit “F” to the agreed statement of facts. There was no further correspondence between the parties.

In the intervention of Mrs. Sheeks to the suit of Daugherty against the bank, it was asked that Homer Sheeks be made a party. Homer Sheeks filed an answer to the intervention of Katie Sheeks, alleging that the property conveyed to Daugherty was in fact his own, and that for convenience the title had .been placed in Mrs. Sheeks and the contract and .sale made for his use and benefit, and this was the reason for the authority contained in the contract for the payments to be made to him; that, after the execution of the contract, Mrs. Sheeks was endeavoring- to divest him of his property, and that the withdrawal of the authority contained in her notice of February 15, 1928, was made pursuant to that purpose. No proof was taken on the controversy between Mrs. Sheeks and Homer Sheeks, and the intervention was dismissed as to Homer Sheeks prior to the hearing. The court directed the bank to deliver to Daugherty the deed in question and adjudged the costs of the action against Mrs. Sheeks. From that decree is this appeal.

The appellant has devoted a part of his brief to the discussion of the right of Katie Sheeks to appoint her husband as her agent. We think this right so well established that we pass from its consideration with the statement that such right unquestionably exists.

On the question of Mrs. Sheeks’ right to revoke the agency of her husband, the appellee takes the position that if the agency was of the usual character and the contract solely between the principal and the agent, the right of revocation would be conceded, but that when “a written contract, having been entered into b3r two or more parties, before it can be modified, altered, amended, or revoked, must be done so b3r the mutual agreement of both parties,” and that the appointment of Sheeks as the agent was “one of the material considerations for the execution of the contract” as is shown by the reply of Daugherty to the notice served upon him by the inter-vener. We are unable to appreciate the force of appel-lee’s contention. The contract was for the purchase of a house and lot in the town of Stuttgart to be paid for in the manner designated, with the stipulation that the property should be kept insured and the taxes paid until the purchase price had been paid. This was a contract, not between Katie Sheeks and Homer Sheeks, but between Katie Sheeks and John Daugherty, and the authority of Homer Sheeks to accept payments was mentioned in said contract merely as a direction as to payment of funds, and was no part of the mutual undertaking of the contracting parties. By virtue of this direction, Daugherty was protected in the pa3rment of moi^ to Homer Sheeks until Sheeks’ agency was revoked and until appel-lee had knowledge of this revocation. This rule is stated in 21 R. C. L., § 37, page 860, as follows: “ So far as third persons are concerned the principal, as a rule, may revoke the authority of his agent at any time, but it is settled that the acts of an agent after his authority has been revoked, bind a principal as against third persons, who, in the absence of notice of the revocation of the agent’s authority, rely upon its continued existence.” This rule has been adopted and followed by this court, and, indeed, it appears to be the generally accepted one. Hinson v. Noland, 14 Ark. 710; Burlington, etc., v. Threlkeld, 60 Ark. 539; Courtney v. Linaker Co., 173 Ark. 777.

It was clearly the duty of Daugherty, upon receiving the notice of February 15 to make all subsequent payments to Mrs. Sheeks. At the time of the receipt of this notice Daugherty was in default in the payment due January 1, .1928, of $200. In his letter of March '28, it is true he stated that he had paid that $200, but he does not state that it had been paid before the receipt of the notice from Mrs. Sheeks, and in the agreed statement of facts it is shown that he did not pay it until January 16, 1929, when, arbitrarily ignoring the notice of revocation, he paid the entire sum due Mrs. Sheeks, $1,026, including interest, to Homer Sheeks. He did this without authority and at his peril.

It is contended, however, that Mrs. Sheeks is estop-ped from now asserting her right to the purchase money of the property conveyed to Daugherty. We can see nothing in Mrs. Sheeks’ conduct to justify the invoking of the doctrine of estoppel. There was nothing in her acts or behavior to lead Daugherty to do something which he would not otherwise have done and which resulted in a loss or injury to him.. It is true, she did not reply to Daugherty’s letter of March 28, but her failure to do so worked no injury to Daugherty, for he could have protected himself by complying with her wishes and the loss, if any, which he may suffer is attributable only to his own folly.

The rights of Homer Sheeks are urged, but we have no evidence of any rights he may have had. The statement of facts and the exhibits thereto upon which the trial court heard the case contain nothing that would establish the contention made by the appellee, and the allegations of his response, without proof, cannot be considered. In his proposal of March 28th, where he was alleging the payment of certain amounts and requesting a reimbursement as a condition for his surrendering the contract, he did not take into consideration the rents of the property from July 1, 1927, and, as we have said, this offer contained nothing which required a reply.

Under the undisputed facts in the case, it is our opinion that the trial court erred, and that the appellant is entitled to the relief prayed. Tlie decree is therefore reversed, and the cause is remanded with directions that the amount of money remaining' unpaid due to Mrs. Sheeks from and after February 15,1928, be ascertained; that the appellee, Daugherty, be required to specifically perform his contract, and that the appellant have judgment against him for the balance due, to secure the payment of which a lien be declared on the lands described in said contract and deed.


text:
    Smith v. North Louisiana Sanitarium.
    Opinion delivered March 24, 1930.

      Marsh, McKay <£ Marlin, for appellant..

      Mahony, Yocum & Saye, for appellees.
   Butler, J.

This case involves the validity of a claim against the estate of T. L. Smith by the appellees, Doctors Abramson and Herold, for medical services, and by the appellee, North Louisiana Sanitarium, for hospital fees and services performed for a Mrs. L. R. Simmons. The probate court, and circuit court on appeal, allowed said claim in the sum demanded, and no complaint is made as to the items or amount of the claim, but the appellant, administrator of the estate of T. L. 'Smith, deceased, contends that the estate is not liable for services rendered Mrs. Simmons, first, as no competent evidence of any agreement on the part of T. L. Smith to be responsible therefor has been offered; second, that, if such undertaking was made by him, it is within the statute of frauds, being a collateral and not an original undertaking; and third, that in any event the estate is not liable for any services rendered to Mrs. Simmons by either the hospital or the physicians after the date of the death of T. L. Smith, December 17,1926.

The testimony relevant to the issues involved, viewed in the light most favorable to the appellees, tends to establish the following facts: T. L. Smith and Mrs. Simmons were contemporaneously shot and wounded by the wife of T. L. Smith on or about the 4th day of December, 1926. Both were immediately taken to the appel-lee’s sanitarium in Shreveport, Louisiana. The sanitarium is a corporation, of which Dr. Abramson is president. The wounded persons were there treated by the appellees, Drs. Abramson and Herold, and eared for in the sanitarium until tlie death of Smith and the recovery of Mrs. Simmons. At the time of the arrival of Mrs. Simmons at the sanitarium the cause of the shooting appears to have been known and discussed by the officials of the sanitarium, and there was some question as to whether or not she should be permitted to remain in the institution. When Smith, who had already arrived, learned of this, he became greatly agitated and urged the sanitarium officials to care for her and the doctors to attend her, and assumed responsibility for her bills, agreeing to pay all her expenses, including’ hire of special nurse. Some days later Smith offered to sign a draft to take care of Mrs. Simmons’ bills and hospital fees, nurses’ hire, et cetera, but at that time he was so ill from the effect of his wounds the offer was not accepted, the doctors giving as a reason that they intended to wait until he could get better and then he might make the draft. The agreement of Smith relative to Mrs. Simmons was made with Dr. Abramson, chief officer of the institution, and with the superintendent of nurses and in the presence of some of the attendants; and from time to time Smith manifested great concern regarding Mrs. Simmons’ condition, aud reiterated his desire that she be given all the attention necessary. Smith gradually grew worse, suffering great pain, and died thirteen days after his entry into the hospital, and while still its inmate. Mrs. Simmons recovered, and was discharged in about ninety days from the date of her entrance into the sanitarium.

On a consideration of the case, the trial court concluded that there was sufficient competent testimony to establish the validity of the claim, of the physicians and the sanitarium, and that the agreement of Smith was not a collateral oral promise to pay the debt of another, but was an original tindertaking* by which he secured the services of physicians for Mrs. Simmons, and the credit for this was extended to him and not to Mrs. Simmons, and that the estate was liable for services rendered Mrs. Simmons after Smith’s death. The evidence appears sufficient to support the court in its findings.

1. In considering the testimony relevant to the rights of the appellee sanitarium, it must be borne in mind that Abramson was not a party to the suit as to it, although suing for himself and his partner, Dr. Herold. The sanitarium is a corporation, and Dr. Abramson is its president. The testimony of the officers of the corporation would not be incompetent under § 4144 of Crawford & Moses’ Digest, which provides: “* * * In actions by or against executors, administrators or guardians, in which judgment may be rendered for or against them, neither party shall be allowed to testify against the other as to any transactions with or statements of the testator, intestate or ward, unless called to testify thereto by the opposite party. * * *” We have held that this statute applies only to those who are technically parties to the suit, and cannot be extended to parties interested in its result. McRae v. Holcomb, 46 Ark. 306; Stanley v. Wilkerson, 63 Ark. 556, 39 S. W. 1043. Nor does it include officers or agents of a corporation defendant. Moseley v. Mohawk Lumber Co., 122 Ark. 227, 183 S. W. 187. Therefore, Dr. Abramson was a proper witness, in so far as the sanitarium was concerned, as to transactions had with the intestate. As to his own claims and that of Dr. Herold, his testimony was excluded by the trial court, but, as there were other competent witnesses testifying as to.the agreement with respect to the employment of the physicians, there was legal testimony to support the finding of the court as to the validity of the claim of the doctors.

2. The evidence also -warranted the conclusion that the oral agreement of Smith was the inducing cause for the care and treatment afforded Mrs. Simmons, and the credit was extended to Smith. In the case of Grady v. Dierks Lumber Coal Co., 149 Ark. 306, 232 S. W. 23, this court said: “* * * In the case of Millsaps v. Nixon, 102 Ark. 435, [144 S. W. 915], the court said, in determining whether an oral promise is original or collateral, the intention of the parties at the time it was made must be regarded, and in determining such intention the words of the promise, the situation of the parties, and all the circumstances attending the transaction should be taken into account, the purpose of the inquiry being to determine to whom the credit was originally given.”

3. The last contention made is that, although the oral undertaking of Smith was properly established by competent evidence, original in its nature, and not within the statute of frauds, yet under the facts in this case, in whatever light they are viewed, the estate of T. L. Smith is not chargeable with any part of the account accruing after his death. This contention cannot be sustained, because the presumption must be indulged from the nature of the employment that it was to continue until the services were no longer needed. Therefore, the contract of employment and for services was for a definite period of time uncertain in its duration, but certain as to events which would determine its ending, namely, the death or recovery of the patient, and from the nature of the case that these determinative events would occur within a time which might reasonably be anticipated. The need of the patient, and not the demise of the employer, must be the factor in the determination of the time in which the contract should cease. This principle was announced in the case of Dale & Banks v. Donaldson Lbr. Co. and Putnam, 48 Ark. 188, where it was said: “If he (physician or surgeon) is called to attend in the usual manner, and undertakes to do so by word or act, nothing being said or clone to modify this undertaking, it is quite clear as a legal proposition that not only reasonable care and skill should be exercised, but also continued attention as long as the condition of the patient might require it, in the exercise of an honest and properly educated judg’ment.” This principle is also laid down and approved in the case of Toland v. Stevenson, 59 Ind. 485, and White’s Executors v. The Commonwealth, 39 Pac. St. 167.

Counsel for the appellant endeavors to distinguish these cases from the case at bar in this, they stress upon our attention the moral obligation resting upon the intestate in his lifetime, in the ease quoted, to provide for the wants of his family, and insist that such was sufficient to make the employment a continuing- one, and urge the lack of such obligation in the instant case. On this point we take issue with able counsel for the appellant. By his own unsocial conduct, Smith created a situation which brought to pass the tragedy resulting in his own death, and the serious and painful wounding of Mrs. Simmons, and her open shame. The wronged and revengeful wife of Smith was the one who inflicted upon Smith and Mrs. Simmons the wounds from which they suffered. It is common knowledge, that it is the woman, often more sinned against than sinning, who must bear the weight of society’s disfavor in cases such as this. This .Smith, desperately wounded as he was, fully realized, and, sensible that it was his own lawless passion which had plunged the frail and yielding partner of g-uilt in so great a depth of pain and woe, and, seeing her about to he denied the ministrations which it would have been inhuman to refuse even a wounded beast, felt moved by every sense of honor and loyalty in the behalf of the partner of his guilt to secure for her the relief and care she so much needed. The writer thinks a strong moral obligation rested on Smith; he was in honor bound to do no less.

Since the contract! in this case was for a definite time, and for services to be rendered another, and since it was within the contemplation of the parties that the services should be rendered as long as needed and regardless of the death of the employer, the position of appellee is further supported by the authority of the case of Barrett v. Towne, 13 L. R. A. (N. S.) 643, where it was held that in the employment of an attorney to defend the brother of the client in a criminal prosecution, that “the best possible defense should be made” and “from the ¡beginning to the end,” such employment was not terminated by the death of the client, and the attorney could recover for services thereafter rendered. In that case the court said: ^“Undoubtedly, at common law, when not coupled wifih an interest, the death of the principal revokes the authority of the agent. The agency ceases, because the power to act is dependent upon the control and direction of another, which has been withdrawn by death. (Citing cases). If the plaintiffs had died, it may have been terminated, for performance by them depended entirely upon their personal efforts. ('Citing cases). ¡But, as no act was required to be done, either by the testator himself, or in his name, a complete performance was possible -without any direction or intervention on his part. If, at his own expense, he had procured the attendance of a physician to treat his brother until cured of a physical ailment, or had contracted with a grocer to furnish him provisions for a year, there would be great difficulty in saying that in either instance his death during performance ended all further liability, because his estate was not bound. Manifestly such a construction instantly would defeat the very object for the accomplishment of which he purposely had obligated himself. In principle the present case must be treated as parallel with the illustration. The various services were neither to be performed, nor was the case to be conducted, in his behalf. * • * * The employment of the plaintiffs was coextensive with the subject-matter with which the parties dealt, and they were not only engaged to assist in its preparation, but to make 'the best defense’ of the brother’s case. * * * No express limitation of time within which these services should be performed, or the required disbursements made, was named. Very plainly, the plaintiffs rightly understood that the testator contemplated and intended that the period of performance should be measured solely by the time which ordinarily would be requisite in the orderly progress of litigation of this class and magnitude. (Citing cases). The general rule is settled, that, where express words of limitation to the contrary are not found, the presumption is that the promisor intends to bind his personal representatives. (Citing cases). The intention of ,the parties furnishes the true criterion, which must be gathered from the language they employ, while each case as it arises must be largely decided upon its particular facts. It was his unqualified purpose to procure an acquittal of his brother through the means of a full preparation of the defense, and the professional efforts of competent counsel, by becoming pecuniarily responsible, as he certainly did, to pay all expenses. But his undertaking went no further. He did not intend to assume the power of control, either by himself, or by a substitute, over the proceedings at any stage. The alleged conspirators, while thus receiving the benefit of his aid, were left absolutely free to conduct their own case from beginning to end as they deemed best, and the requirements of appropriate legal procedure demanded. If thus construed, each contract remained in force, while this condition of affairs compelled the active continuance of the services of the respective plaintiffs. It therefore survived the death of the testator, and his executors became bound .t'o its performance.”

We can see no valid distinction in principle in the case last cited from the instant case, and those cases cited, supra, and relied upon by -the appellant are readily distinguishable from the case at bar, and the cases of Toland v. Stevenson and Barrett v. Towne, supra. The agreement did no,tl create the relation of principal and agent between the parties, for there was no 'supervisory control on the one part or dealing with the subject-matter of the agreement in a representative capacity on the other part. Neither would appellant’s intestate have been liable to Mrs. Simmons for any neglect or malpractice on the part of either of the appellees. Therefore, the undertaking was not a contract of agency, but of employment for a particular purpose, the method of the services rendered discretionary with the employed, and over which the employer neither expected to, nor uonld have, any control; and, as the 'contract was not for services indeterminate in their nature, and. indefinite in their duration, the cases cited by the appellant have no application. Campbell v. Faxon, 73 Kan. 675, 85 Pac. 760, 5 L. R. A. (N. S.) 1002; Lacey v. Gateman, 119 N. Y. 109, 6 L. R. A. 728; Babcock v. Goodrich, 3 How. Pr. N. S. 52; Howman v. Redick, L. R. A. 1915C, 601; Mendenhall v. Davis, 21 L. R. A. (N. S.) 914.

Prom the 'conclusions reached, it follows that the finding's and judgment of the trial court must be affirmed, and it is so ordered.