author: Hart, J.,

text:
    Sherman v. Sherman.
    Opinion delivered June 11, 1923.
    ,1. Husband and wipe — validity op separation agreement. — An agreement of separation between husband and wife in which - their property rights are settled is valid and binding between the parties, and the courts will not regard such contract as avoidable unless the conduct of the parties is such that they themselves so regard it.
    2. Husband and wipe — separation agreement — annulment.— Where the parties to a valid separation agreement afterwards live together as husband and wife and their conduct is such that no other reasonable conclusion can be indulged than that they had set aside or abrogated their agreement of separation, then such agreement will be held to have been annulled by the parties to it, and their marital rights will be determined accordingly.
    .3. Husband and wipe — separation agreement — annulment.— Evidence held to show that a separation agreement was annulled by the acts of the parties.
    .4. Dower — interest op surviving widow. — Where a husband died leaving personal property and also real property not ancestral in character, and no children or debts, his widow was entitled to one-half of the personal property absolutely, to his homestead for her life, and in addition to one-half of his real property in fee simple.
    5. Adoption — parol agreement — effect.—A parol agreement by one to adopt a child will not bind his subsequently married wife, •who was not a party to such agreement, so as to «deprive her of her right to take an undivided one-half interest in her deceased husband’s real estate. ■
    Appeal from Clark Chancery Court; James D. Shaver, Chancellor;
    affirmed.
    STATEMENT OF FACTS.
    Mrs. N. E. Sherman brought this suit in equity against D. H. Crawford, as administrator of the estate of J. W. Sherman, deceased, and Frank Gould Sherman, to liave her dower in her deceased husband’s estate allotted to her.
    The suit was defended on the ground that she had outered into a separation agreement with her husband in which she had relinquished her right to dower in his estate. Another defense was that Frank Gould Sherman was the adopted child of said J. W. Sherman, and that •the widow was not entitled to dower as if her husband had died leaving a widow and no children.
    It appears from the record that Frank Gould Sherman is thirty-one years old, and resided in Michigan at the time J. W. Sherman died. W. J. Gould is his father, and lives in Nebraska, where he has resided for thirty-seven years. Some time in March, 1891, when Frank Gould Sherman was about eighteen or twenty months old, J. W. Sherman proposed to his father that he would take the child and bring him up and. treat him as his own child. W. J. Gould agreed to this, and turned Frank Gould Sherman over to J. W. Sherman to be raised as his own son. They neglected to take out adoption papers, but the child lived with Sherman after that time. J. W. Sherman lived in the State of Nebraska for eleven or twelve years after he took Frank in 1891, and always treated him as his own son. Thereafter Frank went by. the name of Frank Gould Sherman. He has never lived with his father since that time.
    The testimony of ~W. J. Gould was corroborated by that of other persons who lived near them at the time J. W. Sherman agreed to adopt Frank.
    J. W. Sherman and his wife were very much attaeh-■ed to Frank while they lived in the State of Nebraska. After they left the State of Nebraska Mrs. Sherman died, but Frank continued to live with J. W. Sherman. In 1917, J. W. Sherman married again in the State of Texas, and Frank Gould Sherman continued to reside .with him. J. W. Sherman ánd his wife then left the State of Texas and went to reside in Arkadelphia, Ark., in April, 1919, and lived there until J. W. Sherman died in January, 1922. At the time of his death J. W. Sherman owned certain real and personal property in Arka-delphia, Ark. After they moved to Arkansas, Frank Gould Sherman left them and went to Michigan to reside. On the 22d day of October, 1919, J. W. Sherman made a will, leaving* all of his property to Frank Gould Sherman, whom he called his adopted son.
    On the 14th day of April, 1921, J. W. Sherman and his wife made an agreement of separation, which is as follows: “The parties to this agreement are J. W. Sherman and Mrs. N. E. Sherman, who were married in the State -of Texas on September 24, 1917, and have since resided together as husband and wife, and who are now residents and citizens of Arkadelphia, Arkansas, and who have for a long* time been mutually incompatible to each other, and who both mutually agree that it is impossible for them to live together longer as husband and wife, and who mutually agree that it is better for 'both of them to enter into this separation agreement, and in the future to live separate and apart from each other. The terms of this agreement are as follows, to-wit: The said Mrs. N. E. Sherman, being the owner of a residence property situated at the northwest corner of Third and Main Streets in the city of Arkadelphia, Arkansas, and the same being in need of certain repairs, the said J. W. Sherman agrees to recover said house, except the porches, with a new shingle roof, to repaper two rooms and the bathroom, and to repaper two other rooms overhead; he further agrees to pay off, for the benefit of Mrs. N. E. Sherman, the mortgage held on said property by the Midland Savings and Loan Company of Denver, Colorado. The said Mrs. N. E. Sherman is to have all of the furniture and all of the tools and implements about the house where they now live, except all clothes-of the said J. W. Sherman, and all books, and dishes and bedding which belonged to the said J. W. Sherman at the time of their marriage, and typewriter, which property shall be and belong to the said J. W. Sherman, and he shall be privileged to remove the same from their said residence in a reasonable time. Mrs. N. E. Sherman agrees to remove all of her property and furniture from the residence they now occupy in a reasonable time. Both parties mutually agree with each other that they each waive all right that either may have in the property of the other owned by the other at this time, or at any future time, and to join in the execution of any deed or instrument conveying the property of the other that may be necessary to the conveyance of a good title to said property, without any claim or demand of or for any interest therein, or any consideration for so joining in the execution of any such deed or instrument. The said J. W. Sherman agrees to remove his residence from the city of Arkadelphia within a reasonable time, and shall not make said city his residence.so long as it shall be the place of residence of the said Mrs. N. E. Sherman. Each of the parties hereto mutually agree to waive any cause of divorce that either ma}^ have had against the other in the past, and agree that neither will prosecute a suit for divorce. Each acknowledges that the considerations herein mentioned are valuable and are mutually accepted and agreed to as the considerations and stipulations for this agreement of separation.”
    Pursuant to this agreement J. W. Sherman made the repairs on the property of his wife as specified in the contract. J. W. Sherman and his wife never separated, but continued to live together as husband and wife until lie died. J. W. Sherman was sick for four or five weeks before he died, and his wife nursed him during his last illness. They lived together in the home of J. W. Sherman until his death.
    Other witnesses testified that J. W. Sherman and his wife lived at his home in Arkadelphia from the time they moved there until he died.
    Other facts will be stated or referred to in the opinion.

      The chancellor found that the real estate owned by J. W. Sherman at the date of his death was a new acquisition, and consisted of certain personal property and his homestead in the town of Arkadelphia, Ark., upon which he resided with his wife at the time of his death.
    The chancellor also found that J. W. Sherman died leaving surviving’ him his widow but no children.
    ■ It was decreed that the plaintiff, as his widow, was entitled to a homestead in the real estate and also to a one-half interest therein in fee simple, as her dower. She was also decreed dower in the personal property of J. W. Sherman, under the statute: It was decreed that Frank Gould Sherman took the remainder of the estate under the will of J. W. Sherman, deceased.
    Frank Gould Sherman has duly prosecuted an appeal to this court.

      D. II. Crawford and McMillan & McMillan, for appellants.
    The verbal contract of adoption carried out m accordance with its terms was effectual to fix the relation of appellant as an adopted child as though he had been legally adopted. The evidence is conclusive as to the contract and terms of adoption. 162 Mo. 11, 85 A. S, R. 480; 15 Atl. (N: J.)' 249; Kolia v. Rosicky, 41 Neb. 328, 43 A. S. R. 685. Appellant Sherman was entitled to specific performance of the contract. Naylor v. Shelton, 102 Ark. 30; 44 L. R. A. (N. S.) 773; 133 N. W. (Neb.) 183; 60 A. S. R. (Mo.) 270. The agreement to adopt •being 'proved, the child has the status of a natural or legally adopted child as to property rights. Case is governed by principle illustrated in 102 Ark. 42; 126 S. W. (Mo.) 522; 239 S. W. (Mo.) 505. An adopted child is a “child” in the sense of §4518 Revised Statutes of Missouri, which is similar in effect' to § 3536, C. & M. Digest. 33 S. W. (Mo.) 443. See also 21 S. W. 82; 153 Mass. 525, 27 N. E. 768; § 255, O. & M. Digest; 107 N. W. (Neb.) 996. The contract of adoption was partly performed in this state, and will be enforced here. The agreement in Nebraska to adopt fixed tlie status of appellant as an adopted child which followed the parties into Arkansas. 129 Mass. 243, 37 Am. Rep. 321; note to 118 A. S. R. 685; 90 Ark. 364. If appellee can reject the will she will only have a widow’s rights in deceased’s estate as though appellant were his child. The separation agreement fixed the measure of the widow’s interest in property acquired during continuance of marital relation. Ann. Cas. 1917-A 65; 19 C. J. 507; 67 Ark. 15; 124 Ark. 167; Ann. Cas. 1917-A 48; Ann. Cas. 1917-A 58; cases cited in 19 C. J. 512, note 76. Acknowledgment was not necessary to validity of contract under act 1915. Since Constitution of 1874 in effect wife can convey title to separate property by unacknowledged deed. 34 Ark. 160; 39 Ark. 366, act 66, Acts of 1919; 147 Ark. 12. The consideration of separation contract was adequate (97 Fed. 367), and she kept and enjoyed the consideration till the death of her husband. Evidence does not show any abrogation of agreement by her. 123 Ark. 268; 112 Ark. 483. Her testimony as to declarations of deceased should not have been admitted. No implied abrogation of the contract. Burden was on appellee to show it was abrogated. 116 Ark. Living together would not show it, since passage of act of 1915 as amended by act 66, Acts 1916; 116 Ark. 60; 97 Fed. 367; 125 Md. 113; Ann. Cas. 1917-A 48; 179 Ky. 300, 2 A. L. R. 689; 94 Ark. 461. No written reconveyance of the lands, none of the consideration returned. 149 Ark. 533; 106 Ark. 332. Elements of equitable estoppel in this case prevent her claiming the property. 137 Ark.; 136 Ark. 414; 199 Pa. 269; 85 A; S. R. 785.
    ■ Callaway & Callatvay, for appellee.
    An oral agreement for adoption of a child in another State cannot have effect to give such child a legal status as an -heir in this State, to inherit the property of a decedent and deprive the widow of all the property of the estate she is entitled to under our law providing she shall have one-half when there are no children, Under the Alabama rale children, although actually adopted under the laws of other States, are not entitled to inherit property in Alabama from the adopting parent, each State having exclusive jurisdiction to control the transfer of property therein. This rule has been held not viola-tive of the Federal Constitution. 157 Ala. 424; 189 Fed. 205; 199 Fed. 989; 117 C. C. A. 664. The status of Frank G-ould as an adopted child was not fixed in 129 Mass. 243, cited by appellants, which has no application here. The lex fori governs, and there is no law in this State authorizing the adoption of a child by contract. 12 C. J., Conflict of Laws, 483; 64 Ark. 29; 113 Ark. 278. J. W. Sherman’s domicile at the time of his death was at Arkadel-phia, Arkansas, and the law of the domicile at his death controls the succession to his property. 1 Bouvier, 500. The case of 102 Ark. 42 has no bearing on this case. C. & M. Digest, § 3536, provides for the distribution of the estate of a deceased husband who dies “leaving a widow and no children.” The separation agreement between J. W. Sherman and his wife, appellee, was abrogated by the parties. 112 Ark. 488.
   Hart, J.,

(after stating the facts). There is a division of authorities on the question of whether a parol agreement of adoption whereby a parent surrenders a child to others upon their promise to adopt, rear, and educate it as their own, and to give it the same right of inheritance a.s a natural child, but which is not consummated by a statutory adoption, will, if otherwise 'fully performed, be enforced after the death of the adoptive parents. The views which we shall hereinafter express render it unnecessary to decide this question.

An agreement of separation between husband and' wife in which their property rights are settled is valid and binding between the parties. The law- is that, having entered into a valid separation agreement, the courts will not deem such contract avoidable unless the conduct of the parties is such that they themselves so regarded it. Carter v. Younger, 112 Ark. 483, and Dennis v. Perkins, 129 Pac. (Kan.) 165, and cases cited.

These cases also hold that where the panties to a valid separation agreement afterward come together, and live together as lmsband and wife, where their conduct towards each other is such that no other reasonable conclusion can be indulged than that they had set aside or abrogated their agreement of separation, then such agreement will be held to have been annulled by the parties to it, and their marital rights determined accordingly.

Tested by this rule, we think that the facts and circumstances of this case warranted the chancery court in finding that the marital relations between J. W.. Sherman and his wife never ceased, and that there was mutual forgiveness of the past misconduct on the part of each.

In the first place, it may be said that the agreement of separation shows on its face that it was an indivisible contract. It recites that the parties to it had married in Texas in September, 1917, and had since lived together as husband and wife. It further recites that it is impossible for them to live together any longer as husband and wife. Under the terms of the agreement the husband agreed to make certain repairs on a house belonging to his wife. She agreed to remove all of her property 'and furniture from his residence in a reasonable time. Each waived any right in the property of the other, and agreed to join in the execution of any deed necessary to convey the property.

J. "W. Sherman agreed to leave the city of Arkadel-phia and not again live there so long as his wife should do sd. The agreement was executed on the 14th day of April, 1921. The parties never, in fact, separated, but lived together in the home of the husband until he died on January 10, 1922. The husband was sick for five weeks, and his wife attended him faithfully during his last illness. The attending physician and their neighbors testified that slie conducted herself as a faithful wife towards her husband.

The wife testified that they lived together during all of this time as husband and wife, and that her husband, for the most part, made the repairs on her house himself. According to her testimony, they never separated, and never considered that the separation agreement had any binding force and effect.

The agreement of separation contemplated that- he should leave the city of Arkadelphia, where they résided at the time. He not only did not leave, but the parties continued to live together in his home until his death nearly a year later. During all this time there was nothing in their conduct towards each other to indicate to their neighbors that they had separated and were not living together as husband and wife. The husband continued to support his wife, and they discharged their marital duties to each other. This conduct shows an intention on the part of bath of them to consider the separation agreement ended in all respects. .

The preponderance of the evidence indicates that it was not only their intention to end the contract, in so far as it required them to live apart, but also to annul it as to the settlement of their property rights. Hence the wife became entitled to support from her husband, and was supported by him until he died. She then became entitled to dower in his estate.

The evidence shows that, the property in controversy was a new acquisition, and that J. W. Sherman died without having any children of his own. Hence it was the contention of the widow that she was entitled to one-half of his property in fee simple, as her dower, under § 3536 of Crawford & Moses’ Digest. Earl v. Earl, 145 Ark. 559.

On the other hand, it is the contention of Frank Grould 'Sherman that, even if the separation agreement be deemed annulled, the- widow is entitled to only one-third of the personal property absolutely as her dower, and one-third of the realty for her life only.

The chancellor upheld the contention of the widow, and we think that his decision is correct. In the first place, it may be stated that Mrs. N. E. Sherman was the second wife of J. W. Sherman, and. was no party to the agreement to adopt Frank Gould Sherman. That agreement was made during the life of J. W. Sherman’s first wife. Frank Gould Sherman was never legally adopted by them. They agreed verbally to adopt him and raise him as their own child. The father of Frank Gould Sherman turned him over to J. W. Sherman and his wife, to be raised by them and treated as their own child. He knew that no statutory adoption was made or undertaken ■by them. Eelianee was placed entirely upon their- verbal agreement to take him and care for him as their own child. This they did, and always manifested the like affection for him as parents usually do 'for their own children.

When the first wife of J. W. Sherman died, Frank Gould .Sherman continued to reside with J. W. Sherman. After the latter married again, he continued to reside with them until after they moved from Texas to Arkansas. Frank Gould Sherman then went to Michigan, and resided there until he was summoned back to Arkansas during the last illness of J. W. Sherman. Hence, under the undisputed testimony, he does not occupy the relation of an adopted child, but only stands in the relation of an infant child for whose benefit a parol contract to adopt had been made.

As we have just seen, the plaintiff was not a party to that agreement, and such an agreement could not in any wise operate to bar her dower. The agreement had not been carried into effect when her husband died. Our statute now under consideration gives the widow an absolute estate in the property of her husband, and the interest thus conferred vests immediately in her upon the death of her husband. She takes absolutely an undivided oue-lialf interest in fee simple, and it is such an interest as immediately vests at her husband’s death. Barton v. Wilson, 116 Ark. 400; Crowley v. Mellon, 52 Ark. 1; Jacks v. Dyer, 31 Ark. 334; Tate v. Jay, 31 Ark. 576, and McGuire v. Cook, 98 Ark. 118.

J. W. Sherman died seized and possessed of the real and personal estate involved in this lawsuit, and there was no valid lien on it. Mrs. N. E. Sherman had not released or relinquished her dower in any.part of said estate. The verbal promise of her husband to adopt Frank Gould Sherman could not have the effect to' deprive her of her dower in his estate. She could only do that by some affirmative act on her part releasing or relinquishing her dower, or by some act which would operate as an equitable estoppel against her.

Nothing of this sort is shown by the record, and it follows that tlie chancellor was correct in holding ‘that she was entitled to dower under the provisions of § 3536 of Crawford & Moses’ Digest.

No other issues are raised by the appeal, and it follows that the decree will be affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    Woodruff County v. Road Improvement District No. 14.
    Opinion delivered June 11, 1923.
    1. Bridges — authority op county court to contract for. — In an action against a county to recover for building a county bridge, the presumption, in the absence of proof, is that money to build the same has been appropriated, therefore that the county court had authority to contract for construction of the bridge.
    2. Bridges — allowance' by county court — validity.—Where a road improvement district paid a contractor to build a county bridge, under an agreement of the county court to pay a part thereof, an order of the court allowing a claim therefor to the contractor, instead of to the district, was at most an irregularity, which- did not render the allowance void.
    3. Courts — appeal prom county court. — Where warrants were issued by the county court on an allowance, but their delivery was withheld by order of the court, an order of the court canceling the warrants as improperly issued was appealable.
    Counties — assignability op warrants. — Where a county court made an order of allowance and issued warrants based thereon, ■such warrants were assignable, and the assignee could appeal from a subsequent order of the county court canceling the warrants as improperly issued.
    Judgments — direct and collateral attack — parol evidence.— While parol evidence may be introduced in a direct attack on a judgment of a court of record to show that it was rendered in vacation, the rule is otherwise upon a collateral attack.
    Judgments — collateral attack. — A proceeding in the county court in which outstanding county warrants are called in for cancellation and xeissuance is a collateral attack.
    Appeal from Woodruff Circuit Court, Northern District; J. M. Jackson, Judge;
    affirmed.
    • STATEMENT OE PACTS.
    The county court of Woodruff County in 1921 made an order calling in the outstanding warrants of the county for cancellation and reissuance, and this' appeal involves the correctness of a judgment of the county court canceling certain warrants, and refusing to reissue the same.
    It appears’from the record that a special act to create Road Improvement District No. 14 of Woodruff County, Ark., was approved on February 7, 1920. Three commissioners were named in the act to construct the improved road.
    In constructing the improved road it was necessary to build bridges across two streams. There were at ready wooden bridges over these streams, but they had become worn out, and it was necessary to replace them. In April, 1920, the board of commissioners of the road improvement district made an agreement with the county judge of Woodruff County for the county to pay $2,500 each toward the replacement and construction of new bridges across these streams.
    Pursuant to the agreement, the board let a contract at public.auction, in the manner prescribed by the statute for the construction of bridges. The Illinois Steel Bridge Company was the lowest bidder, and the contract •was awarded to it for the construction of both bridges.
    The cost of constructing the bridge across' Roaring Slough was $8,398.87. After this bridge had been constructed the board of commissioners of the road improvement district paid the Illinois Steel Bridge Company the full amount due it for the construction of the bridge. The payment was made out of the funds of the road improvement district. The board of commissioners of the road improvement district then presented a claim to the county court, in the name of the Illinois Steel Bridge Company, for the sum of $2,500 to be applied toward the payment of the construction of the Roaring Slough bridge. Just before the county judge Avho had made the ag’reement with the. board of commissioners of the road improvement district went out of office, an order was made allowing the claim of the Illinois Steel Bridge Company in the sum of $2,500 for steel used in the construction of a bridge across Roaring Slough, and warrants were ordered issued in the sum of $100 each for tliat sum. Tlds order was duly entered of record on the 30th day of December, 1920. The record recites that this was an adjourned day of the county court which was duly held at the courthouse in said county.
    The warrants were duty issued, and the board of commissioners procured an assignment of the claim from the Illinois Steel Bridge Company to the secretary of the board of commissioners of Road Improvement District Nó. 14 of Woodruff County. Ou the 1st of January, 1921, a new county judge urns inducted into office in Woodruff County, and he refused to allow the county clerk to deliver these warrants.
    At tlie April term, 1921, of said county court, an order was made calling in the outstanding county warrants under § 1994 of Crawford & Moses’ Digest, for the purpose of cancellation and reissuance. On August 1, 1921, the county court of said county made an order canceling the warrants in question and refusing to reissue tlie same.
    Subsequently tlie board of commissioners of the road improvement district procured a written order of assignment of these warrants to it from the Illinois Steel Bridge Company. On the 7th day of January, 1922, tlie chairman of the board of commissioners of said improvement district made an affidavit of appeal from the order of said county court canceling said warrants and refusing to reissue the same. The appeal was duly granted by the circuit clerk. A motion was made to dismiss the appeal on the ground that the affidavit had been filed by the chairman of the board of commissioners of the' road improvement district, and not by the Illinois Steel Bridge Company or its agent. The motion was denied by the court. The case was heard in the circuit court on the facts stated above, and upon other facts which do not have any 'bearing upon the issues raised by the appeal, and which for that reason we need not state.
    The circuit court was of the opinion that said warrants were originally properly issued by the county court in favor of the Illinois Steel Bridge Company, and thereafter duly assigned, for a valuable consideration, to Road Improvement District No. 14 of Woodruff County, Ark.; that, at the time said warrants were canceled by the county court, they were the property of Road Improvement District No. 14, and that the county court erred in the cancellation of said warrants; that said road improvement district has the right to a reissue of them and to have them delivered to the commissioners of said district.
    Judgment was rendered accordingly, and to reverse that judgment Woodruff County lias duly prosecuted an appeal to this court.

      R. M. Hutchins, for appellant.
    This is not one of the “good faith” county warrant cases such as discussed in 72 Ark. 330. On December 30, 1920, the county court allowed claim of Illinois Steel Bridge Company for $2,500, and warrants were issued therefor. Warrants were called in for reissue August 1, 1921, and these warrants,'being in the clerk’s office, were canceled and not reissued. Appellee road district, claiming to be the owner of said warrants by assignment but not being a party to the record, the judgment of cancellation had no right to appeal from the order of the county court canceling the warrants herein. Sec. 33, art. 7, Constitution; Kirby’s Digest, § 1487; 52 Ark. 99; 71 Ark. 48; 53 Ark. 287. It was so held prior to adoption of present Constitution. 26 Ark. 461; 30 Ark. 578; 28 Ark. 479; 47 Ark. 411. The road district is not. the party aggrieved. 99 Ark. 59; 3 N. Y. Supp. 664, 56 N. Y. Supr. Ct. 606. 64 N. C. 110; 49 Pac. 5. Appellee road district alleges it became the owner of the warrants for a valuable consideration by an assignment in writing executed by the Illinois Steel Bridge Company, but did not prove such assignment, its validity being challenged by affidavit under § 479, C. & M. Digest. County warrants are negotiable and transferable by delivery (7 Ark. 214), but these warrants have never been out of the possession of appellant, never been in possession of appellee, its alleged assignor. The allegation of assignment should have included delivery of the warrants in order to entitle appel-lee to maintain an action in its name. 1 Eng. 200; 2 Eng. 491, 376. County warrants non-negotiable within meaning of the law merchant, and 'buyer stands in shoes of seller. 28 L. R. A. 645. The letter did not operate as an assignment so as to enable appellee named therein to sue. 148 Ark. 283. There was a defect of parties, and appellant’s motion to dismiss appeal should have been granted. The warrants were not issued on the order of the county court. The court erred in not allowing appellant to show the term had lapsed before order adjourning to date of issuance of warrants was made or entered. 141 Ark. 437; 145 Ark. 259; 86 Ark. 591. A judgment entered in vacation as was this order was not the order of a court. 138 Ark. 226. An adjourned session could only be held by order of court made in term time and entered of record. Kirby Digest, 1531. The record of usurpation should have been expunged. 96 Ark. 427. Warrants were not issued on verified claim, and were issued without an appropriation made. §2029 C. & M. Digest and §1976; 118 Ark. 530. The warrants were regularly called in and canceled, and appellee’s claim is barred. C. & M. Digest, §§1994, 1996, 117 Ark. 254; C. & M. Digest, § 1976; 118 Ark. 524; 103 Ark. 468; sec. 16, art. 19, Constitution.

      W. J. Dimgmi, for appellee.
    No bill of exceptions in the case. The motion for new trial was presented in vacation without a compliance with the statute. C. & M. Digest, §1311; 129 Ark. 550. Appellee was the party aggrieved, and had a right to the appeal. 135 Ark. 83; 90 Ark. 219; 87 Ark. 160. The same situation is presented here as in the case of 118 Ark. 524. The county court had the authority to make the contract to pay the amount agreed on towards the construction of the bridges. 72 Ark. 330. The Road District purchased the claim or warrants from the bridge company and had its order to the clerk directing that thev be delivered to the district when issued, and § 479, C. & hi. Digest, has no application to this case. The warrants were regularly issued, and no error committed in refusing to allow the testimony claiming that there was no adjournment of court to date of order of issuance. 87 Ark. 123. There is no dispute as to the existence of the contract and the justice of the claim, and the warrants should have been reissued and not canceled. 118 Ark. 524. The attack made upon the order of allowance of the warrants is collateral and cannot operate to invalidate them.
   Hart, J.,

(after stating the facts). This court has held that, in a proceeding under the statute to call in the outstanding warrants of a county to redeem, cancel, reissue or classify them, only those warrants may be rejected which could not have been valid claims against the county under any state of the proof, or where the judgment of allowance was obtained by fraud. Monroe County v. Brown, 118 Ark. 524, and Izard County v. Vincennes Bridge Company, 122 Ark. 557. Those cases hold, further, that a review for mere errors of the court in canceling and refusing’ to reissue, warrants is a collateral attack on the judgment of the county court, which is not authorized under the statute.. It appears from the record that the order of allowance of the warrants in question in favor of the Illinois Steel Bridge Company was made on the 30th day of December, 1920, which was a day of the adjourned term of the county court. The order of cancellation and the refusal to reissue said warrants was made at á subsequent term of the county court held in August, 1921.

Hence, under the rule announced in the decisions cited above, the county court could not review the former judgment of the county court for errors in the allowance of the warrants, but could only refuse to reissue the warrants if the judgment of allowance was obtained by fraud, or if, under any evidence which might have been adduced, the claim of the Illinois Steel Bridge Company could not have been a valid one. There is no evidence tending to show that the judgment of allowance was obtained by fraud, and no claim on that account is made.

The county court canceled the warrants in question, and refused to reissue them because they had been issued without authority in the first instance. The county court erred in this conclusion. The bridge across Roaring Slough was a county bridge, which it was the duty of the county court to construct in the first instance, and to replace after the old bridge had worn out. Crawford & Moses’ Digest, § 827.

This court has held that, in an action against a county to recover for building a bridge, the presumption is that money to build the same has been appropriated. Howard County v. Lambright, 72 Ark. 330, and Watkins v. Stough, 103 Ark. 468. Hence the county court could liave made a valid contract in tlie first instance for tlie construction of tlie bridge across Eoaring Slough.

This court has held that a county may, like an individual, ratify an authorized contract made in its behalf if it is one tlie county could have made in the first instance. Leathem & Company v. Jackson County, 122 Ark. 114.

It follows that, if a county could ratify an unauthorized contract, it could ratify one which it had authorized. The bridge was let at public bidding, and the Illinois Steel Bridge Company, being the lowest bidder, received the contract. The bridge actually cost $8,398.97, and the cost of it was paid out of the funds of Eoad Improvement District No. 14 of Woodruff County. The road commissioners asked that the allowance be made in favor of the Illinois Steel Bridge Company, which had performed the' work of constructing the. bridge, and this was done by the county court, under an order duly entered of record. Hence, under the authority cited above, the most that can be said in the matter is that there was an irregularity in the allowance of the claim. It could not be said, in any event, that the county court was without authority to make the allowance under any evidence that might have been adduced in the matter. If it should be said that the claim should have been issued in favor of the road improvement district instead of the Illinois Steel Bridge Company because the latter company had already been paid for constructing- the bridge by the road improvement district, this would not render the allowance void and beyond the jurisdiction of the court, but would only be an error. The order of the allowance was obtained in favor of the Illinois Steel Bridge Company by the board of commissioners of the road improvement district. It was for steel used in a bridge for the county, and it could in no sense be said to be a void order of allowance.

Therefore we are of the opinion that the county court erred in refusing to reissue the warrants.

It cannot be said that the warrants were not presented for reissuance. They were in the hands of the county clerk, and the county court directed him not to deliver them to the board of commissioners of Eoad Improvement District No. 14. On the face of each warrant is the following, written in pen and ink: “Filed 7-30-21, by payee. Eoy Mitchell, clerk. Wrongfully issued without authority.” It would have been a vain and idle thing for the board of commissioners of the road improvement district to have formally demanded the reis-suance of the warrants when the county court had directed the county clerk not'to deliver the warrants to said board.

Again, it is insisted that the appeal should have been dismissed because it was taken by the chairman of the board of commissioners of the road improvement district, and not by an agent of the Illinois Steel Bridge Company. The record shows that the Illinois Steel Bridge Company had been paid by the road improvement district for the construction of the bridge, and that the bridge company had, in writing, assigned its claim in the warrants to the road improvement district. Sec. 475 of Crawford & Moses’ Digest provides that all bonds, bills, notes, agreements and contracts in writing for the payment of money or property shall be assignable. Under this statute the bridge company had a right to assign its interest in the warrants to the road improvement district. The latter then became the owner of the warrants and the real party in interest -in this proceeding. It therefore had the right to prosecute an appeal from the order of the county court canceling said warrants and refusing to reissue the same. Sec. 1091 of Crawford & Moses’ Digest provides that, where the right of the plaintiff is transferred or assigned during the pendency of the action, it may be continued in his name, or the court may allow the person to whom the transfer or assignment is made to be substituted in the action.

Finally, it is insisted that the court erred in not allowing oral evidence tending to show that the order of allowance on December 30, 1920, was made in vacation.

The record of the county court shows that the order of allowance was made on an adjourned day of the term of the county court, and this brings up the question as to whether or not the court erred in refusing to allow that record to be contradicted by parol evidence. This court has held that parol evidence may be introduced in a direct attack on a judgment or decree to show that it was rendered in vacation. The reason given was that, if the fact of the rendition of the decree in vacation could not be shown by parol evidence, we would have the .anomalous condition of a decree being'a nullity and of the parties affected by it being denied the right to establish that fact. Jackson v. Becktold Printing & Book Mfg. Co., 86 Ark. 591.

The rule is quite different, however, on collateral attack. The county court is a court of record, and upon collateral attack its judgments entered of record import absolute verity. If they are erroneous, the errors must be corrected in an application for that purpose to the court of which they are records. They cannot be impeached collaterally. Any other doctrine would make the records too uncertain and unreliable. Ferguson v. Kumbler, 25 Minn. 183. Such sanctity and protection must be afforded by the judgments and decrees of courts of record as are necessary to the protection of property and the preservation of the rights of the parties obtained under such judgment or decrees. Were the rule otherwise it would be in vain that the law prescribed an act of limitation or a mode of reversing the proceedings of tribunals in the appropriate forum, if the parties should be permitted to controvert their validity whenever collaterally drawn in question in any court. This would be enabling a court to do that indirectly which it could not do directly, and exercise appellate jurisdiction when none is conferred upon it. Evans & Black v. Percifull, 5 Ark. 424, and Clay v. Bilby, 72 Ark. 101.

Under tbe authorities cited above, the present proceeding is one to review the judgment of the county court in making the allowance for error, and it is therefore a collateral attack upon the judgment.

From the views we have expressed it follows that the judgment of the circuit court is correct, and should be affirmed. It is so ordered.


text:
    First National Bank v. Farmers’ & Merchants’ Bank.
    Opinion delivered June 11, 1923.
    1. TROVER AND CONVERSION — REFUSAL TO ACCOUNT FOR FUNDS.— Where plaintiff and defendant banks each had a mortgage on separate undivided interests in a' crop of cotton, and plaintiff agreed that defendant might sell the cotton and account to plaintiff for its interest therein, the defendant’s refusal to pay over to plaintiff the amount of plaintiff’s interest received by it constituted a conversion thereof and rendered defendant liable to plaintiff.
    2. Judgment — conclusiveness.—Where plaintiff in the present action had intervened in a prior action, and without objection was allowed to dismiss the intervention without prejudice, plaintiff was not concluded by a subsequent judgment therein.
    3. Garnishment — failure to make defense. — Where defendant as garnishee in another proceeding permitted a judgment to go by default in favor of the garnishee, without making defense that the money in its hands belonged fo the plaintiff in the present proceeding, it is no defense that if plaintiff recovers defendant will be forced to pay the money twice.
    Appeal from Poinsett Chancery Court; Archer Wheatley, Chancellor;
    affirmed.
    STATEMENT OE EAOTS.
    On the 8th day of November, 1921, the Farmers’ & Merchants’ Bank of Marked Tree brought this suit in equity against the First National Bank of Marked Tree and 0. A. Rushing, to foreclose a mortgage on four bales of cotton executed in its favor by O. A. Rushing’, and to recover judgment against the First National Bank of Marked Tree in the sum of $123.13 for the proceeds received by it from the sale of said cotton.
    The Retail Lumber Company was allowed to intervene and claim the $123.13 under and by virtue of a suit against 0. A. Rushing for -an account due it by him and a garnishment proceeding against the First National ■ Bank of Marked Tree.
    It appears from the record that on the 1st day of November, 1920, 0. A. Rushing borrowed $1,800 from the Farmers’ & Merchants’ iBank, and gave a chattel mortgage on certain cotton grown by 'Mm to secure the indebtedness, which was evidenced by his promissory note. During the month of December, 1920, O. A. Rushing told . J. D. DuBard, the cashier of the Farmers’ & Merchants’ Bank, that C. E. Causey, cashier of the First National Bank, had requested that he be permitted to ship the mortgaged cotton and sell it in the name of the First National Bank. He stated further that the First National Bank held a mortgage on the interest in the cotton belonging to J. S. Roy, a share-cropper of O. A. Rushing. Rushing told Causey that his interest in the cotton was mortgaged to the Farmers’ & Merchants’ Bank, and that he would consent for the First National Bank to ship and sell said cotton provided that it would turn over his share of the proceeds to the Farmers’ & Merchants’ Bank. Mr. Causey agreed to this. DuBard told Rushing that this agreement would be satisfactory to the Farmers’ & Merchants’ Bank, and asked Rushing to get a letter from Causey to the Farmers’ & Merchants’ Bank confirming the agreement to pay over the proceeds from Rushing’s interest, in the sale of the cotton to the Farmers’ & Merchants’ Bank. DuBard testified that he never agreed for Rushing to ship or sell the cotton.
    The above is a brief statement of the testimony of J. D. DuBard and 0. A. Rushing.

      According to the testimony of C. E. Causey, he was the cashier of the First National Bank, and the treasurer and secretary of the Retail Lumber Company. A number of officers of the First National Bank are also officers of the Retail Lumber Company. Cause3r shipped the cotton in question for the First National Bank, and sold it. That hank had a mortgage on J. S. Roy’s interest in the cotton. The interest of 0. A. Rushing in the proceeds from the sale of the cotton amounted to $123.13.
    Causey denied that he made an agreement with J. T). DuBard to pay over the proceeds of Rushing’s interest in the cotton to the Farmers’ & Merchants’ Bank. He admitted that Rushing asked for an order that the proceeds be paid to his hank, hut that he had refused to do so.
    It also appears from the record that the Retail Lumber Company brought suit against 0. A. Rushing to recover $312.71, due it on account, and caused a writ of garnishment to be issued and served upon the First National Bank. The Farmers’ & Merchants’ Bank was allowed to intervene in said action, and, before judgment was rendered in the circuit court, it was allowed to withdraw its claim as intervener. So it will be seen that the proceeds arising from the sale of the same cotton was involved in both suits.
    On the 16th day of May, 1922, judgment was rendered in the circuit court in favor of the Retail Lumber Company against 0. A. Rushing in the sum of $112.71, with the accrued interest. Judgment was rendered by default against the defendant Rushing, and also against the garnishee, First National Bank. The judgment recited that the petition of the intervener, Farmers’ & Merchants’ Bank, had been withdrawn.
    Another order of the court showed that the petition of the intervener, Farmers’ & Merchants’ Bank, was withdrawn without prejudice.
    On the 28th day of September, 1922, a decree was rendered in the chancery case in favor of the Farmers’ & Merchants’ Bank against the First National Bank for $123.13.
    To reverse that decree, the First National Bank has duly prosecuted an appeal to this court.

      J. G. Wascom, for appellant.
    Appellee lost its lien by agreeing that the cotton should be sold, and ratified the sale 'by proceeding at. law, and could not afterwards go into equity to foreclose mortgage. Bradley v. Brigham, 3 L. R. A. 507. It elected to pursue its remedy at law, and is hound thereby. Garvin v. Squires, 9 Ark. 533; 9 R. C. L. 965. Waived its mortgage lien by intervening in suit at law. 64 Ark. 213; 50 L. R. A. 714, note. The decree should not be allowed to stand and appellant required to pay the claim to two different judgment creditors. 9 R. C. L. 963; 123 Wis. 510,102 N. W. 1, 3 Ann. Cas. 773. The former judgment' at law by the Retail Lumber Company against appellant as garnishee precludes appellee from recovery in equity. 48 Ark. 349; 91 Ark. 252. Judgment against garnishee by default is final. C. & M. Digest, § 4916. Appellee, after its election of remedies, cannot follow the property or its proceeds. 9 R. C. L. 969, note 4; 101 Wis. 286, 77 N. W. 149, 7 A. L. R. 926.

      C. T. Carpenter, for appellee.
    Appellee bank consented to a sale of the mortgaged cotton in which both were interested, by appellant bank, on its agreement to pay over its part of the proceeds of sale. Appellant bank could not disregard its agreement and permit some one else to take 'appellee’s part of proceeds of sale and escape liability therefor. 56 Ark. 475. There is no merit in the contention that appellee lo>st its right to recover its interest in the proceeds of the sale of the mortgaged cotton by election of remedies, and the cases cited have no application here. Appellee assumed no inconsistent position in filing the intervention, which was later withdrawn without prejudice, and it is only equitable for him to pursue his remedy here. Craig v. Merrmether, 84 Ark. 306; 35 Ark. 376; 18 Ark. 344. It is appellant'is own fault if it shall have to pay two judgments for this money, and simple justice requires that it shall pay appellee.
   Hart, J.,

(after stating the facts). It appears from the record that the Farmers’ & Merchants’ Bank had a valid mortgage on the undivided interest of O. A. Rushing in certain cotton raised by him, and that the First National Bank had a mortgage on the interest of J. S. Roy, a share-cropper of Rushing, in the same cotton.

One of the grounds relied upon by appellant for a reversal of the decree is that appellee had given Rushing permission to sell the cotton,, and had thereby lost its mortgage lien. Both Rushing and DuBard, the cashier of the Farmers’ & Merchants’ Bank, denied that that bank gave Rushing permission to sell the mortgaged cotton. They both testified that the Farmers’ & Merchants’ Bank gave the First National Bank permission to sell the cotton, because they both had separate mortgages on separate undivided interests in the cotton. It was understood that, when the cotton was sold, Rushing’s interest in the proceeds should be turned over to the Farmers ’ & Merchants’ Bank and applied towards the payment of his mortgage indebtedness to that bank.

It is true that the cashier of the First National Bank contradicted this testimony, but the chancellor found in favor of the Farmers’ & Merchants’ Bank on this point, and it cannot be said that his finding is against the preponderance of the evidence. Hence it became the duty of the First National Bank to turn over to the Farmers’ & Merchants’ Bank the sum of $123.13, which was the amount received by it from the sale of Rushing’s interest in the mortgaged cotton. The Farmers’ & Merchants’ Bank and the First National Bank each had a mortgage on an undivided interest in the same cotton. The parties had a- right to agree to a private sale of the mortgaged cotton and to apply the proceeds of the sale to the mortgage indebtedness, respectively, of Rushing and Roy. This, by agreement of the parties, amounted to a foreclosure of the mortgage at private sale, and the refusal of the First National Bank to pay the proceeds-arising from the sale of Rushing’s interest in the cotton to the Farmers’ and Merchants’ ¡Bank amounted to a conversion of the same by it, and made it liable therefor to the Farmers’ & Merchants’ ¡Bank. In short, the refusal of the First National Bank to pay over to the Farmers’ & Merchants’ Bank the amount received by it frorri the sale of Rushing’s interest in the cotton amounted to a conversion of the proceeds, and rendered it liable to the Farmers’ & Merchants’ Bank therefor.

It is next insisted by counsel for appellant that ap-pellee, having been allowed to intervene in the suit in the circuit court filed by the Retail Lumber Company against 0. A. Rushing as defendant and the First National Bank as garnishee, could not subsequently withdraw from that suit, and that the judgment of the circuit court in favor of the Retail Lumber Company against First National-Bank, garnishee, settles the issues and precludes the Farmers’ & Merchants’ Bank from recovering against the First National Bank in the chancery case. That would be true if that suit had proceeded to judgment before the Farmers’ & Merchants’ ¡Bank had been allowed by the court to withdraw from it. The record shows that its intervention in that suit was dismissed without prejudice, and that the present suit was instituted by it against the First National Bank on the same cause of action before judgment was rendered in the circuit court in favor of the Retail Lumber Company against the First National Bank as garnishee.

It is insisted by counsel for appellant that, if appel-lee is allowed to recover against it in this suit, it will have to pay twice. -That is true, but the fault is with appellant. As we have just seen, the intervention of ap-pellee in the circuit court was withdrawn without prejudice, and the present suit was begun in the chancery court before the case in the circuit court came on for hearing. Notwithstanding the pendency of the suit in the chancery court, the appellant allowed the Retail Lumber Company to take judgment against it by default ■in the circuit court. No doubt this was done with the desire to favor the Retail-Lumber Company, because the officers in that company and in the First National Bank were practically the same. The First National Bank had a right to favor that company in any way it could legitimately do so, but it had no right to favor it to the legal prejudice of the Farmers ’ & Merchants ’ Bank. The latter had the right, by permission of the court, to withdraw from the suit in the circuit court without prejudice, and to institute a new suit on its own account on the same cause of action against the First National Bank. If the latter bank wished to avoid payment twice, it should have defended the garnishment suit in the circuit court and not have allowed judgment to be rendered against it by default. Not having done so, it took the chance of the Farmers’ & Merchants’ Bank’s recovering the proceeds arising from the sale of Rushing’s interest in the cotton in the chancery court.

Appellant made no objection to the appellee dismissing its intervention in the suit in the circuit court, and is not now in -an attitude to complain of the court’s action in allowing the dismissal without prejudice.

In this connection it may be said that no objection was made by appellant to appellee’s bringing suit against it for the conversion of the mortgaged cotton in the chancery court.

The decree of the chancery court will therefore h¿ affirmed.


author: Smith, J. McCullough, C. J.,

text:
    Thompson v. Mann.
    Opinion delivered June 11, 1923.
    1. Statutes — construction.—The aid of rules of construction is invoked in the interpretation of statutes only when the meaning of a statute is uncertain, and such rules are never allowed to defeat what appears to be the manifest purpose of the law-making ¡body.
    2. Highways — limit op expenditure. — Acts 1923, No. 316, § 9-A, provides that the Baucum road shall not cost District No. 10 'of Pulaski County in excess of $330,000, exclusive of interest. Prior to its passage, the district had expended $60,000 on the Baucum road. Held that this amount was included in the $330,000 limit.
    3. Highways — legislative assessment op benefits — zonal system. ■ — -A legislative adoption of the zone system as the basis of assessment of benefits from a road improvement is not arbitrary where the lands affected are of the same general kind, all being level and arable except certain lands covered by water, which are expressly excepted.
    4. Highways — petition op property owners. — Art. 19, § 27, Constitution, requiring a petition of a majority of the property owners for the creation of an improvement district within a city or town, has no application to a highway improvement a part only of which is within a city.
    Appeal from Pulaski Chancery Court; John E. Martineau, Chancellor;
    affirmed.

      Bose, Hemingway, Cantrell & Loughborough, for appellant.
    This is the third appeal involving Road Improvement District No. 10, Pulaski County. The validity of act 436 of Acts of 1919 creating the district was upheld in 139 Ark. 153. At the extra session acts were passed which changed the plans of the improvement, and provided for the improvement in subdistrict 6 of the Perry-ville road, beginning in the city of Little Rock at Markham and Main streets. The commissioners decided to begin the' improvement at Third and Victory streets instead, and it was held that they had the right to do so. 154 Ark. 311. Act 316 of 1923 session authorized the commissioners to make a hard surface to part of Baucum road, and to extend tlie Perryville road from. Third and Victory streets to Main and Markham streets, the point of beginning designated in first act. Sec. 9-A of the act 316 does not limit the total cost of the improvement for the Bancnm road, but only for the work to be done therein under the provisions of the act. '25 R. C. L. 994, statutes, § 238. A different construction would be strained and not warranted. 86 Ark. 368; 91 Ark. 5. The act is presumed to have only a prospective operation, and will not be construed to have a retroactive effect. 116 Ark. 472; 127 Ark. 341; 147 Ark. 24. It is shown that the $250,000 limitation on the cost to rural lands will not be exceeded. The legislative finding of benefits in § 14 of act 316 is not arbitrary. 147 Ark. 87; 140 Ark. 474; •145 Ark. 382. There is no. doubt about the Legislature having power to authorize the beginning of the improvement of the Perryville road at Markham and Main streets. 139 Ark. 153; 139 Ark. 277; 139 Ark. 168; 118 Ark., 119; 120 Ark. 282; 130 Ark 507; 137 Ark. 354. The act 347 of Acts of 1923 authorized the Commissioners to review their former decision and to begin the improvement on Perryville road at Markham and Main streets. The portion of the decree enjoining the commissioners from expending $330,000 in improvement of ■the Baucum road in section 2 of district authorized by act of 1923 should be reversed and the other portions of the decree affirmed, and a decree here dismissing the ■complaint for want of equity.

      Cockrill & Arvmstead and John W. Newman, for ap-pellee.
    Section 9-A of act 316, Acts 1923, is a limitation of the entire cost of the improvement in that part of the district to $330,000, necessarily including the $50,000 already expended therein. Section 9-b of the act is likewise'a limitation of the cost to $250,000 against the rural lands in' the district for the improvement. The finding of -the Legislature that one class of lands in the district would not receive greater benefits than another designated class was arbitrary. The act authorizing the paving of Victory and Markham streets in the city of. Little Rock as part of the Perryville road is void as in conflict with §'27, art. 19, of the Constitution. The fact that this might have been a part of the Perryville road under the first act and before the commissioners decided otherwise can make no difference, said improvement having been made to begin or end at Third and Victory streets. The cases cited by appellant are not in point on this proposition. We insist that, in line with the principles announced in former decisions, the acts in question are unconstitutional and void.
   Smith, J.

This is the third appeal involving Road Improvement District No. 10 of Pulaski County. In the case of Cumnock v. Alexander, 139 Ark. 153, the validity of act No. 436 of the regular 1919 session of the General Assembly creating the district was upheld. At the extra session of the General Assembly acts were passed which changed the plans of the improvement by adding certain roads to be improved and by eliminating one of the subdistricts. The statute as amended provided for the improvement, in subdistrict No. 6, of a road designated as the Perryville road, beginning in the city of Little Rock at Main and Markham' streets, and running out Markham Street to Victory Street, thence south .on Victory to Third Street, thence west past Forest Park, and thence northwesterly to Cross Roads. The commissioners determined that the portion of the improvement extending from the corner of Main and Markham to Third Street, just described, could be eliminated because those streets could be used as a part of the improvement without repair or other work on the part of the district, and the county court approved the amended plans of the commissioners which excluded those street's from the plans of the improvement. A property owner in the district sought to restrain the commissioners from thus changing the plans, but we upheld their right to do so in the case of Crawford v. Pulaski Road Improvement Distinct No. 10, 154 Ark. 311.

The General Assembly of 1923 passed four acts relating to this district, but the construction o-f only two of them appears to be involved in this litigation, those being acts Nos. 316 and 347.

Act 316 authorizes the commissioners to add a hard surface to that part of the Baucum road in section 2 from, its intersection with the Galloway pike to a point about a mile and a half south of Scott Station, and added to the boundaries of the district some land in Lonoke County, and extended the northern boundary of section 2 in Pulaski County about one mile.

This act contained a limitation on the cost of construction, found in section 9A, which reads as follows: ‘■‘■Section 9A. The road provided for in this act shall not be less than 16 feet nor more than 20 feet in width, and shall not cost said district in excess of $330,000, exclusive of interest.”

Section 4 of act 316 also contains a legislative finding that the lands in this section of the district which were also situated in the boundaries of the North Little Bock and Galloway Boad .District would receive no greater benefit per acre than lands in other parts of the district equally distant from the improved road; it also contained a limitation that the entire improvement, together with the interest on the cost, should not cost the rural lands in section 2 more than $250,000.

Act No. 347 provided that the commissioners should have the right to improve Victory Street from Third to Markham, and to improve Markham Street from Victory to Main as a part of the improvement in section 6 of the district, this being a part of the improvement which the commissioners were originally authorized to make,' but later abandoned.

Appellee, the plaintiff below, is the owner of lands in both sections 2 and 6 of the district, and he alleged that the commissioners were incurring expenses in the preparation of plans for the improvement of the Baucum road which would cost exceeding $330,000, the limitation contained in the section of the statute quoted above, and that the limitation of $250,000 on the rural lands found in section 9B of act 316 would also be exceeded.

Plaintiff also attached as arbitrary the legislative finding of benefits contained in section 4 of act 316, and he also attached as unauthorized the action of the commit sioners in incurring expense in mahing plans for the improvement of the streets in the city of Little Bock, set out above, asserting that this could be done only upon' a petition of a majority in value of the owners of property adjacent thereto.

The answer put in issue all the allegations of the complaint, and the cause was heard on the pleadings and on oral testimony, which is before us in the bill of exceptions made at the trial.

The court dismissed all of the complaint for want of equity, except that portion seehing to restrain the commissioners from incurring expense in mahing plané foi the improvement of the Baucum road, thé total cost of which the court found would exceed $330,000. Both parties have appealed.

It appears from the testimony that the commmis-sioners have sold eighty thousand dollars in bonds for the purpose of obtaining money to improve the Bau-cum road, and had expended $50,000 of that amount when act 316 was passed. After the passage of that act the engineer of the district changed the plans of that improvement, and admitted, in his testimony, that the improvement contemplated by the changed plans could not be constructed for $330,000 if the $50,000' already expended was included as a part of the cost.

We think the court properly construed section 9A of the act, and that the $330,000 is a limitation on the total cost. It is true that statutes are construed prospectively, but the aid of rules of construction is invoked in the interpretation of statutes only when the meaning of a statute is uncertain, and rules of construction are never • allowed to defeat what appears to be tlie manifest purpose of the lawmaking body. Hopper v. Fagan, 151 Ark. 428.

Obviously, the thing of interest, to the taxpayer is the cost of the improvement — the total cost thereof. The fifty thousand dollars already expended is a part of the ■cost which the taxpayer will have to discharge, and the work done with this fifty thousand dollars, is a part of the final plans for the improvement, and must be taken into account in ascertaining what the cost of the road will be, because the work done with this fifty thousand dollars will be a part of the road. This fifty thousand dollars worth of work .has not been paid for ’by the property owners, except that bonds have been sold which are liens upon the lands in the district, and their payment lies in the future as the bonds mature, and these liens can be discharged by the property owners only when they have paid the cost of the improvement, and this cost will include the whole amount expended for the construction of the road..

In placing this limitation on cost, the -Legislature excluded interest, but excluded interest only, and it follows therefore that the commissioners are without authority to build a road which will cost exceeding $330,000, exclusive of interest.

What we have said is applicable also to the limitation on the cost to the owners of rural property contained in section 9B, but the testimony shows that this limita- . tion-will not be exceeded.

The Chief Justice and Mr. Justice Humphbeys do not concur in the view that the limitation covers total cost, they being of the opinion that this limitation relates to . the sum to-be expended after the passage of the act which contains the-limitation.

The majority is also of opinion that the legislative finding contained in section 4 of act 316 is not arbitrary. The testimony establishes the fact that the lands affected are of the same general kind, all being level and arable, except certain lands lying in lakes, bnt the finding of benefits does not apply to the lands covered by water, as they are expressly excepted. This appears to be a case in which the adoption of the zone system as the basis of assessment of benefits is not arbitrary, and, as is pointed out in the brief of counsel for the road district, the obvious reason for the provisions of section 4 is that the Legislature desired security for those landowners whose lands were in both districts that they wonlfi; not have to pay more than other lands not in both sections and no nearer the road. In other words, the assessment of benefits for the new road must take into account the fact that the existing road affords benefits for which they, 'no doubt, liad already been assessed, which fact must be taken into account in assessing for an additional road, and the General Assembly has, for itself, found and declared a limitation on these betterments; and we think there was no abuse of power in this respect. Hill v. Echols, 140 Ark. 474; Hines v. Road Improvement Dist. No. 5, 145 Ark. 382.

Justices Wood and Hart do hot concur in this view, it being their opinion that the legislative finding is arbitrary.

The majority is also of opinion that the section of the act authorizing the paving of Victory and Markham streets in the city of Little Bock is valid. The objection to this provision of this statute is that it violates section 27 of article 19 of the Constitution, in that it authorizes the paving of streets in a city without the consent of the property holders owning property adjoining the locality to be affected.

The question which determines the validity -of this part of the statute is whether the paving of those streets is properly a part of the proposed improvement, and, if that question is answered in the affirmative, the statute is valid, for we have several times held that the Legislature may create a road district and authorize the commissioners to improve tire road through an incorporated town or city, Cumnock v. Alexander, 139 Ark. 153; Summers v. Road Imp. Dist., 139 Ark. 277; Reitzammer v. Road Imp. Dist., 139 Ark. 168; Cox v. Road Imp. Dist., 118 Ark. 119; Nall v. Kelley, 120 Ark. 277; Bennett v. Johnson, 130 Ark. 507; Tarvin v. Road Imp. Dist., 137 Ark. 354. Indeed, in the case of Cumnock v. Alexander, supra, one of the grounds of attack on the statute was that the commissioners were authorized to improve those streets, and we held the commissioners had the right to do so. The commissioners later determined the improvement could be constructed without the improvement of those streets, and we held that if such was the case the district would not be required to improve them. Crawford v. Pulaski Road Imp. Dist No. 10, 154 Ark. 311.

Now the Legislature has determined that this part of the improvement should be restored as a part of the Perryville road, and we must assume that there has been a review or a reconsideration of the finding of the commissioners upon which they abandoned this part of the road.

Of course, the Legislature could not authorize the ' improvement of the streets of a city under the guise of connecting the streets with country road districts, but we do not feel warranted in saying that this is a subterfuge to permit this to be done, but is rather a single improvement of which the city streets mentioned compose a part, and upon that assumption that portion of the act is upheld. Judges Wood and Hart do not agree to the conclusion of the majority on this feature of the case.

The views of the different members of the court result in the affirmance of the decree of the court below in its entirety, and it is so ordered.

McCullough, C. J.,

(dissenting in part). Mr. Justice Humphreys and the writer do not agree to that part of the opinion which holds that the sum mentioned in the statute under consideration is a limitation on the total cost of the improvement of the whole road. It is the purpose of interpretation of a statute to ascertain the meaning of the lawmakers, not by the application of any particular formula, but by an examination of the language of the statute as a whole. State v. Trulock, 109 Ark. 556.

In enacting the statute under consideration the lawmakers were dealing, not with the whole project as authorized in the original statute creating the district, but with a particular pa-rt of the road — that part which is definitely described in the new statute. The statute provides that the particular part of the road which is described shall be paved with hard surface, and it is declared that the road referred to “in this act * * * shall not cost the district in excess of $330,000, exclusive of interest.” They meant that part of the road to be paved. This is made perfectly clear when it is considered that the declaration is in the same sentence coupled with another declaration that the road “provided for in this act shall not be less than sixteen feet nor more than twenty feet in width.” It cannot reasonably be claimed that the Legislature meant to prescribe the width of the whole road as specified in the original district, for there is no intimation that any change was intended to be made in the whole road, but in dealing with the question of paving with hard surface a portion of the road described, it was deemed advisable to specify the width as well as the maximum cost, and this is all done in one sentence, and it shows clearly that the Legislature meant to prescribe the width and the maximum cost only of that part of the road which was to be paved.


author: Smith, J.

text:
    Knights and Ladies of Security v. Lewellen.
    Opinion delivered June 11, 1923.
    INSURANCE — BENEFIT INSURANCE — BURDEN OF PROOF AS TO MEMBER’S standing. — A certificate issued to a member of a benefit society is evidence that the member is in good standing, and such good standing is presumed to continue until there is proof that it no longer exists, and the burden of establishing that the member is not in good standing must be assumed by the association.
    Appeal from Garland Circuit Court; Scott Wood¡ Judge;
    affirmed.

      Galvin T. Gotham and A. J. DeMers, for appellant.
    The court erred in permitting appellee to testify in regard to a second receipt without laying a proper foundation for such testimony. 2 Ark. 315; 1 Greenleaf on Evidence, §§ 82, 88. Also erred in permitting witness Swaim to testify about a postal card claimed to have been seen by him, which was wholly incompetent. The court erred in giving instructions 3 and 4 and in refusing to 'give instructions “B,” “D” and “F” requested by appellant. Instruction 3 erroneously put the burden of. proof as to failure to pay dues upon appellant. 118 S. W. 1168; 7 C. J. 1107. No. 4 was likewise erroneous. The testimony is not sufficient to support the verdict, and a verdict should have 'been directed for appellant.

      A. B. Belding, W. D. Swaim and James- E. Hogue, for appellee.
    No error was committed in the introduction of testimony. Instructions numbered 3 and 4 are correct statements of the law. 87 Ark. 115. Instructions “B” and “D” asked by appellant were covered by other instructions, and F was properly refused, as there was no question of waiver in the case.- The 'Contention that the next assessment after the first was intended to become due and payable before the expiration of the period of protection for which the first assessment paid is unreasonable. Word “month” means calendar month. 0. & M. Digest, §9748; 3i8 Cyc. 312; 5 Words & Phrases, 4575. The second assessment was due on'July 30, but the assured had until August 30 in which to .pay it.
   Smith, J.

This is the second appeal’in this cause, the opinion on the former appeal being, reported' in 150 Ark. 60 (Knights and Ladies of Security v. Lewellen).

The suit is on a benefit certificate issued to the plaintiff on the life of. her husband, and the former judgment in her favor was reversed because of an erroneous instruction given over the objection of the defendant. We did not set out the testimony in detail, as we found it unnecessary to do so. Upon the remand of the cause there was a verdict and judgment for the plaintiff in the action, from which is this appeal.

We stated in the former opinion that the controlling question of fact is whether the insured had paid dues for two months, or only one; and this question is controlling on this appeal, as the defendant company (hereinafter referred to as the order) admits liability if there were two payments of dues.

The insured’s application for the benefit certificate was taken on May 27, 1919, at which time he was given the following receipt:

“Knights and Ladies oe Security.
“May 27, 1919.
“Received of T. J. Lewellen $2.20 as application fee.
(Signed) “C. A. Smith, Deputy.”

This payment was sufficient to cover, and did in fact cover, dues for one month.

The insured was initiated and the policy was delivered to him on June 30-, at which time it became effective as a policy of insurance, and he died on the 13-th day of August thereafter. The order admits the receipt of the payment made on May 27th, but denies that any other dues were ever paid.

The plaintiff, who is the widow of the insured and the beneficiary in the certificate, gave testimony to the- effect that her husband, who was killed in a railroad wreck, had among his papers at the time of his death a second receipt for the payment of dues. The witness did not remember what month’s dues the receipt covered, but she testified that she read it and knew the receipt covered dues to the order which her husband had paid.

Objection was made to the admission of secondary evidence in regard to this receipt and its contents, but plaintiff testified that it was not in her possession, but had been given by her to an attorney who offered to collect the certificate for her. This attorney denied that he had the receipt or that he had ever seen it, and this conflict made a question for the jury.

It might be said that the testimony of the plaintiff is of itself too indefinite and uncertain to support a finding that there was a second payment of dues. In other words, that she did not sufficiently prove the contents of this lost receipt to warrant the submission of the question whether there was a payment of dues which it covered. But we think the testimony does raise this issue when the testimony of plaintiff is considered in connection with that of her attorney. Her attorney testified that the plaintiff turned over to him certain papers belonging to her husband, one of these being a notice or postal card dated August 6, 1919,. which had been sent out by the collecting officer of the order designated as the financier, and that, after looking over these papers, the attorney went to the office of the financier to inquire if a payment had been made pursuant to this notice.

Objection to the introduction of this testimony was made upon two grounds; first, that the card itself, was the best evidence, and second, for the reason that it made no difference whether the card .was sent or not, as it did not constitute a waiver of the forfeiture resulting from the nonpayment of dues, as, under the rules of the order, one failing to pay dues was automatically suspended. The court overruled the objection made, and in doing so said: “It might show whether he was suspended or not; that might be a circumstance, and I will let it go to the jury for that purpose; of course, on the question of the card being the best evidence, yon -will have to show some reason why it is not produced.” This witness then proceeded to testify what he did after reading this notice, and his testimony will be set out.

The objection to the admission of testimony in regard to finding the card may be disposed of by saying that the card appears to have no substantial bearing on the case. It appears to have been a notice of delinquency, and it is not contended that any dues were paid after its receipt, and no contention was made that it operated to waive the forfeiture because of the nonpayment of dues if the insured was in fact delinquent in the payment of dues.

The delivery of this card to the attorney furnished the occasion for his visit to the financier of the order, and the attorney testified that he presented this notice and asked to be allowed to examine the records of the order in which the account was kept of dues which had been paid. This privilege was accorded the attorney, and he testified that the record at that time showed a payment of dues under date of May 30, and also under date of June 30. This is vigorously denied by the financier of the order, and the record was submitted to the jury and examined by the jurors with the aid of a microscope. This original record has been submitted to us, under stipulation of counsel, and, while we do not feel called upon to review the jury’s finding on this question of fact, we do announce our conclusion that the appearance of the record is not such as to afford no corroboration of the testimony of plaintiff’s attorney. The record does present a soiled appearance, but whether this is from an erasure having been made or from the frequent examination to which it has been subjected we do not decide.

The testimony of the attorney, if true, tends to prove that dues were twice paid, and corroborates the testimony of the plaintiff that the lost paper was a receipt for dues, and the testimony of the two witnesses, taken together, is legally sufficient to support the finding that the insured. made a second payment, and, if so, it is admitted that the certificate was in force at the time of the insured’s death.

The court gave, over the defendant’s objection, an .instruction numbered 3, reading as follows :■ “The court will instruct you, however, that the issuance of this benefit certificate was evidence that Thomas J. Lewellen was a member in good standing of the defendant society at the time that the certificate was issued, and that condition would be presumed to continue, unless the defendant has shown, by a preponderance of’the evidence, that he forfeited his membership by the nonpayment of dues.”

It will be observed that the instruction does not deal with the question of the reinstatement of a suspended member, but only with the presumption of continued good ■standing. The certificate here sued on was issued by a fraternal insurance order not substantially different'from the one sued on in the case of Grand Lodge K. of P. v. Whitehead, 87 Ark. 115. We there said: “A certificate issued to a member of a benefit society is evidence that the member is in good standing, and such good standing is presumed to continue until there is proof that it no longer exists; and the burden of establishing that the member is not in good standing must be assumed by the association. Royal Circle v. Achterrath, 204 Ill. 549, S. C. 98 Am. St. Rep. 224; Ind. Order Foresters v. Zak, 29 Am. St. Rep. 318; Siebert v. Sup. Council, 23 Mo. App. 268; 25 Cyc. 925, subd. (g).”

Upon the authority of this case, in view of the issue ■ joined, we hold the instruction was not erroneous or prejudicial.

The financier of the order testified that he suspended the insured for the nonpayment of dues, and noted the suspension on the record which he was required to keep, and it is insisted that there was no competent testimony that the insured was not properly suspended, and that the verdict should therefore, have been directed in favor of the order. This insistence leaves out of account the testimony tending to show that the dues were paid, and, if the dues were paid, there was no authority for the financier to suspend the insured, and the fraternal order was liable.

A case was made for the jury, and the testimony is legally sufficient-to support the verdict; and, as no error appears, the judgment is affirmed.


author: Humphreys, J.

text:
    Athletic Tea Company v. McCormack.
    Opinion delivered June 11, 1923.
    1. PRINCIPAL and surety — discharge of surety. — Where one employed as sales representative of appellant gave a bond, with appellee as surety, obligating himself to make weekly reports of “stock on hand and in transit,” such provision was for the benefit of appellee as well as of appellant; and where appellant failed to require such report and to notify appellee of such omission, he thereby discharged appellee from liability on the bond.
    2. Pleading — amendment by proof. — Though appellee surety failed to plead a waiver toy appellant of a provision for appellee’s benefit, the defense is nevertheless available where evidence thereof was introduced and the case was tried upon the theory that' appellee had been released by such waiver.
    Appeal from Pulaski Circuit Court, Third Division; A. F. House, Judge;
    affirmed.

      Rogers, Barber •& Henry, for appellant.
    The introduction of the judgment against the principal and the guaranty bond signed by Gr. A. McCormack made a prima facie case against him on his plea that he had not executed the bond. The court erred in directing a verdict for appellee on the ground that appellant had waived its guaranty as against appellee by not requiring his principal to include in his reports to appellant the items of ‘ ‘ stock on hand and in transit. ’ ’ Certainly such defense must have been pleaded to be availed of. 32 Cyc. 149; 10 Stand. Pro. 693-F. No such plea was interposed, and no testimony was offered by appellee in support of 1'liis contention, and for this reason alone the judgment was erroneous. The omission was not material, and none of the parties could have been prejudiced by it. 32 Cyc. 179; 64 IT. S. 149; 32 Cyc. 115. There is no contention that the omission prejudiced the rights or increased the risk of the guarantor. Even if the omission was material and appellant negligent in not giving notice- to the guarantor, the guarantor -would be released only to extent of damages suffered by him because of such omission. 14 Am. & Eng. Enc. 1152a, 1151. The judgment should be reversed, and, the facts being undisputed, appellant should have judgment here for amount of guaranty.

      Chas. Q. Kelley and Carmichael & Hendricks, for ap-pellee.
    The judgment should be affirmed for noncompliance with Rule 9. 136 Ark. 188. None of the reports of salesman showed “stock on hand and in transit,” as the contract required, and it is agreed appellant failed to notify appellee of this omission. This report was for the benefit of appellee as well as appellant, and appellant, having waived it, changed the contract without the consent of appellee, thereby releasing Mm as surety. 113 Ark. 429; 21 R. C. L. 1007. 74 Ark. 600 is controlling in this case. See also 2 Frost, Law of Guaranty Insurance, 241. The evidence was introduced without objection, and the pleadings will be considered amended to conform to the proof. 84 Ark. 37.
   Humphreys, J.

This is a suit upon a contract and bond by appellant against O. C. Langford, as principal, and R. -F. Marsh, and appellee, sureties, for the faithful performance of the contract. The contract sued upon was an employment contract, whereby O. C. Langford was employed by appellant as its sales representative in Little Rock. O. C. Langford was obligated in the contract to pay appellant all sums collected by him for it in the prosecution of the business. The bond was an obligation in the sum of $500 executed by Langford, as principal, and Marsh, and appellee, sureties, to appellant, conditioned for the faithful performance of the contract. The contract contained a provision to the effect that Langford should make weekly reports to appellant showing total sales, cash collected, amount outstanding, and stock on hand and in transit.

The action against the several defendants was submitted on different days.

On June 23, 1922, appellant obtained judgment against O. C. Langford for $606.54, from which there was no appeal.

On June 16, 1922, it obtained judgment by default against E. F. Marsh for $500, the face of the bond, from which no appeal has been prosecuted. On the same day the cause between appellant and appellee was tried, which, at the conclusion of appellant’s testimony, resulted in an instructed verdict in behalf of appellee. The judgment was rendered in accordance with the verdict exempting appellee from liability on the bond, and dismissing* the complaint of appellant, from which is this appeal. For the purposes of the appeal it is agreed between the parties “that the principal to the contract, O. C. Langford, furnished weekly reports during the time of his employment up to and including December 20, 1920, but that none of the reports, after the report for the week of ¡September 13, 1920, show ‘stock on hand and in transit, ’ and that plaintiff failed to notify defendant McCormack of this omission.” The court held that the provision in the contract for a weekly report embracing total sales, cash collected, amount outstanding, and stock on hand and in transit, was an essential part of the contract, for the benefit of the sureties in the bond as well as appellant, and that the acceptance by appellant of weekly reports from O. C. Langford which omitted “stock on hand and in transit” amounted to a material change in the terms .of the contract without the consent of appellee, thereby discharging him as the surety on the bond. Appellant’s contention for reversal is that the provision of the contract referred to was for the sole benefit of appellant, and that a waiver of same on its part in no way affected the sureties. We cannot agree with learned counsel for appellant in this contention. Had the- weekly reports been made in conformity to the contract, it would have reflected, at the end of each week, the exact state of the account between Langford and appellant. Sucli an account would have served as a check upon Langford and a means for discovering any deficit that might exist in its very inception. A bondsmaii would naturally rely upon such restrictions in a contract, for they tend to protect him from loss. It cannot be said of a clause in a contract which serves as a protection to a surety that it was for the sole benefit of an obligee in the bond conditioned for the faithful performance of the contract. The weekly reports omitted matter which was necessary in order to ascertain the exact condition of the account between Langford and appellant. Without showing the amount of goods on hand and in transit, it was impossible to determine at the end of any week whether the deficit or shortage existed in fact. In determining the effect upon a surety of a waiver -of a stipulation in a contract similar to the stipulation in question by an employer, this court, in the case of Singer Mfg. Co. v. Boyette, 74 Ark. 600, said: “The stipulation for weekly settlements in this case was an essential part of the' contract. The enforcement of it would have made a record of the business transactions of Mrs. Boyette, and lessened litigation as to the same, and would have held her in surveillance, and checked the misappropriation by her of moneys in her hands belonging to the company, and would probably have led to the discovery of any misappropriation of money before it could have assumed considerable proportions. This, doubtless, was the object of the stipulation, and its enforcement would a.t least have afforded some protection to the sureties on the bond. Plaintiff having, without their consent, acquiesced in the violation and breach thereof, thereby released and discharged them from all liability on the bond. ’ ’

Appellant’s second and last contention for reversal is that the waiver was not pleaded as a defense. It is true appellee did not interpose the waiver as a defense, in his written answer, but, without objection on the part of appellant, evidence was introduced, and the case tried, upon the theory that appellee had been released as surety because appellant waived the weekly reports required by the contract.

No error appearing, the judgment is affirmed.