author: Wood, J.

text:
    Flanagan v. Drainage District No. 17.
    Opinion delivered January 30, 1928.
    1. Appeal and error — dismissal for want of final judgment.— Where there is no final judgment, no appeal lies, and an appeal will he dismissed under Crawford & Moses’ Dig. § 2129, for want of final judgment.
    2. Appeal and error — time for appeal. — Under Crawford & Moses’ Dig., § 2129, an appeal will lie and must he taken from a final decree within the time prescribed by statute for perfecting of appeals.
    3. Appeal and error — order overruling or sustaining demurrer.— An order overruling or sustaining a demurrer to a pleading without further action is not appealable.
    4. Appeal and error — final judgment. — A judgment to be final must dismiss the parties from the court, discharge them from the action, or conclude their rights to the subject-matter in controversy.
    5. Appeal and error — final judgment.' — In a cross-action by 'a contractor to recover from a drainage district profits anticipated from the construction work which he lost by alleged breach of the district to carry out its contract, a decree finding the contractor not entitled to anticipated profits held final so as to be appealable, though there was no formal dismissal of the cross-complaint with reference thereto.
    6. Appeal and error — time for appealing. — Where a decree relative to a cross-complaint merely disposed of such pleading, an appeal from such decree must be taken within six months, as provided by Crawford & Moses’ Dig., § 2140.
    7. Drains — substitution of new contract. — Substitution by the parties to a contract for the purchase of drainage district bonds, of a new oral contract for the previous one, held to have relieved both parties from the obligation of the original contract.

      8. Drains — damages for breach of contract. — Damages for breach of a contract for the purchase of drainage district bonds should be estimated as of the time the breach occurred.
    9. Equity — obligation of plaintiffs to do equity. — He who seeks equity must do equity.
    10. Drains — reimbursement of contractors. — Where contractors had made arrangements with the drainage district to complete a drainage project, but, after the contractor had done work and expended money in preparation for performing the job, the district refused to proceed under the contract, held, in a suit by taxpayers to cancel the contract, the drainage district should be required to remunerate the contractor for -the work he had done and the outlay made in endeavoring in good faith to perform the contract before he was apprised of its abandonment.
    11. Parties — when objection interposed too late. — Defense that a • cross-complainant was not the real party in interest is a plea in bar which should have been interposed in the answer to the cross-complaint.
    12. Corporations — waiver of issue of capacity to sue.' — By answering the cross-bill of a cross-complainant, cross-defendants thereby waived any issue they might have raised as to the cross-complainant’s incapacity to sue because the nonresident corporation was not qualified to do business in the State.
    Appeal from Mississippi Chancery Court, Chickasawba District; J. M. Futre.ll, Chancellor;
    affirmed.

      J. T. Coston, for appellant.

      Tried)er & Lasley and Coleman & Riddick, for appellee.
   Wood, J.

Drainage District No. 37 in Mississippi County, Arkansas, was a very large district, created by act No. 3.03 of ihe Acts of 1917, p. 4-85. The plans of the district showed that it would require many drains or ditches to complete the project. Among these was a ditch or drain designated as Improvement No. 48, which hereafter, for convenience, will be so called, which would drain approximately seventy thousand acres of the district.

On the 35th of July, 3920, a contract was entered into by one J. T. Flanagan and District No. 3.7 for the construction of improvement No. 48 as called for by the plans. On February 8, 3.921, Flanagan assigned the contract to the Harding Construction Company, a Minnesota corporation, and on the same day the Harding Construction Company in turn assigned a two-thirds interest in the contract to Andrew and Toleff Jacobson, and they in turn conveyed a one-sixth interest in the contract to J. O. and A. G. Shuland. On the 10th of October, 1923, after Flanagan had done considerable clearing on the right-of-way under the contract, and was ready to commence excavation, he was notified by the directors of the district that his contract would not be carried out by the district..

In December, 3920, J. E. McGibbon entered into a contract to purchase $450,000 worth of the bonds of the district. John E. McGibbon was manager of the Northwestern Mortgage & Security Company of Fargo, North Dakota, which the Jacobsons controlled. The contract for the purchase of the bonds was in his name, but he was buying the bonds for the company he was managing. On November 7, 1921, Baker and Shepherd, two landowners in the drainage district, filed a bill in the chancery court of Mississippi County against Flanagan and his associates and McGibbon and his associates, and later filed an amended complaint in which it was alleged:

(3) That Flanagan was in reality the purchaser of the bonds, and that the two contracts were let at one and the same time, one being the consideration for the other; (2) that the construction contract was let privately, for an exorbitant price, without competition; (3) that an error of two feet was made in establishing the levels of Improvement No. 48; (4) that, on account of said error, Improvement District No. 48 would not give the relief intended to be given to the landowners; and (5) that,'if the plans were changed so as to construct Improvement No. 48 deep enough to give the relief intended, it would be so deep that it could not be maintained, owing to quicksand and other • defects in the soil.

The complaint and amended complaint both concluded with a prayer for the cancellation of both contracts, and that Flanagan be enjoined from attempting to enforce Ms contract, and that some sum he fixed by this court, to be deposited with the court by Drainage District No. 17, to protect the same J. T. Flanagan in any judgment for damages that he.may secure in this cause for breach of said contract, heretofore set out, in the event it should be finally determined that said contract was a valid obligation on the part of said Drainage District No. 17. Flanagan and his associates and McG-ibbon and his associates filed an answer, denying all charg’es of fraud and irregularity in letting the contracts, and embodied in the answer a cross-bill against the district, concluding with a prayer for an injunction enjoining the district from annulling its contract. Later an amendment was filed by the defendants to their cross-complaint, in which they reaffirmed the allegations of the original cross-complaint and alleged that the district had abrogated its contract with Flanagan and had repudiated its contract with McGibbon for the sale, of $450,-000 worth of the bonds of the district, and had sold and delivered these bonds to other parties; that, if Flanagan and his associates had been allowed to perform the contract, they would have realized a profit of $300,000 net, and if McGibbon 'and his associates had been allowed to purchase the bonds in accordance with the provision of his contract, they would have realized a net profit of $75,000. McGibbon and his associates therefore prayed judgment in that sum against the district for a violation of the contract for the sale of bonds to McGibbon, and Flanagan and his associates pra3red judgment in the sum of $300,000 for the violation of the .construction contract with the district for the construction of Improvement No. 48.

The district answered the complaint of the plaintiff, admitted its allegations, and denied the allegations of the cross-complaint, and prayed for cancellation of the construction and bond contracts.

Issues were joined by a denial by the defendants of the allegations of the amendments to the amended or supplemental complaint of the plaintiffs, except the clistrict admitted, as stated, the allegations of the complaint, and denied the allegations of the cross-complaint; and there was also an answer of the plaintiffs to the allegations of the cross-complaint and amended cross-complaint, in which the allegations of these pleadings were denied.

On November 7, 1921, a temporary injunction was issued restraining the district, its commissioners and Flanagan from carrying- out the provisions of the contract for the construction of Improvement No. 48, and restraining the district from paying to Flanagan any sum of money in settlement or adjustment, as damages, for the breach of such contract, and restraining Flanagan, his agents, attorneys and employees, from instituting any separate action seeking to recover damages from the district, or to interfere or prevent the district from selling or delivering the -bonds.

A large volume of testimony was taken, fully developing the facts on the issues joined.

On September 24, 1923, the chancery court of Mississippi County, through its chancellor, J. M. Futrell, rendered the following decree:

“This cause coming on for final hearing, come all of the above-named parties by their respective solicitors, and the cause is submitted to the court on the pleadings filed therein, with the exhibits thereto, and on the depositions of the witnesses filed in this cause, with the exhibits thereto, and the court, after argument of counsel, being well and -sufficiently advised in the premises, finds that the contract entered into by and between J. T. Flanagan and the board of directors of Drainage District No. 17 of Mississippi County, Arkansas, dated July 15,1920, was a valid contract at the time it was entered into, but that Drainage District No. 17 subsequently became entitled to rescind the said contract on account of legal impossibility of performance, subject to its liability to reimburse the said J. T. Flanagan for all expense incurred by him in making the necessary preparations to perform and carry out said contract up to the date he had knowledge of the fact that the district would not permit him to carry out said contract, tog-ether with the contract price of any work done by him under the contract up to said date, and including any damages sustained by him in connection with the performance of the contract up to said date, but not including anticipated profits on materials not furnished or work done.
“Wherefore it is considered, ordered, adjudged and decreed that the injunction heretofore issued restraining the parties from carrying- out the contract referred to be and the same is hereby made perpetual, and that' the cross-complainants, J. T. Flanagan, J. R. Mo Gibbon, Toleif Jacobson, Andrew Jacobson, J. O. Shuland, A. G. Shuland and Harding Construction Company, have and recover of and. from Drainage District No. 17 of Mississippi County.the contract price for all work actually done by them in performance of the contract referred to up to the timie the said J. T. Flanagan had knowledge of the fact that the’ drainage district would not permit the said contract to be carried out, together with all expenses necessarily incurred by said parties preparing to carry out and perform said contract prior to the time referred to, including any damages sustained by them in performance of said contract up to said time, the amount of the recovery to be determined hereafter by the court or by the master to be appointed by the court; it is further ordered that such amount shall be determined from the evidence already submitted in the cause, and from such additional evidence and testimony as the parties may see fit to produce on such issue, and jurisdiction of this suit is hereby retained until such issue is finally disposed of.
“The question of liability as between John R. MoGibbon, Toleif Jacobson and Andrew Jacobson on the one side, and Drainage District No. 17 on the other,, on the contract for the purchase of $450,000' of the district bonds at par, and the damages, if lany, for the failure to carry out said contract, is reserved for future décision. The question of costs is also reserved for future decision.
“Archer Wheatley, Esq., is hereby appointed special master in this cause, and the issue noted above is hereby referred to him. He is hereby given the usual powers of a master, and is directed to ascertain and determine the facts with reference to said issue, and to report his findings of facts to the next term of this court, or either to the chancellor in vacation, if possible.
“The question of the liability of J. T. Flanagan and the other cross-complainants for interest on the $100,000 of the district’s funds which were held by the bond purchasers, pursuant to the order heretofore made in this cause, is expressly reserved for future decision. It is further ordered that the said $100,000 remain in statu quo for' thirty days from this date, during which time the said Flanagan and the other cross-complainants may give a good and solvent bond to be approved by the court or master, conditioned to pay the district legal interest on said sum or such parts thereof as they m'ay designate until the final disposition of this cause, and further conditioned as required by law for injunction bonds, and, if such a bond is given within the specified time, the said sum, or such part thereof as said parties shall designate, shall be held as now held under the order referred to until the cause is finally disposed of. If no bond is given as provided herein, or if the parties designate less than the full amount of said sum, the said $100,000, or the excess of such sum over the amount designated, shall be released from the order above referred to and may be made by the parties now holding it to the said district.”

The special master made his report, in which, among other things, he states:

“'The special master was appointed with directions to state an account on the basis of the actual loss sustained by the contractor, without considering any anticipated profits whatever. This is the theory on which this report has been made up.
“For the convenience of the court and interested parties, the different classes of items have, in a way, been separated. Improvement No. 57, which was completed just prior to the work of overhauling the dredge-boat for Improvement No. 18, was finished about July-15, 1921. The testimony offered by the district would indicate there was no serious opposition on their part to the allowance of all expenses incurred between July 15 and October 10, the date on which the contractor was notified the district would not have ditch No. 18 dug. A list of the alleged expenses incurred in the overhauling of the boat prior to July 15 was put in evidence. Some of these were eliminated by the contractor. There were 123 items of these expenses. It appeared from the books of the Harding Construction Company that items 1 to 37 had been charged to Improvement No. 57, and had never been credited to that improvement and recharged to Ño. 18. The district therefore contends that none of these items are properly chargeable to No. 18. As to a large number of these items, the evidence of witnesses is otherwise undisputed that the material called for by the invoices was actually used after July 15, and for this reason the special master has given the contractor credit for these items, but has separated the amount, so that, if his finding in this respect is erroneous, it may be easily corrected.
“As above stated, the district gave notice on October 10, 1921, that the ditch would not be dug. It contends that the contractor should therefore have stopped all expense of every kind and nature on that day, and that it (the district) is not chargeable with anything thereafter. The special master thinks this is an arbitrary position to take, and that the contractor should be allowed a reasonable time in which to adjust matters following this breach of the contract. If a reasonable time is given, the termination of its length must be made without reference to- any mathematical basis. The master has arbitrarily adopted sixty days, and has therefore allowed the contractor expenses incurred up to December 10, 1921. The contractor, on the other hand, did not sell the boat until April, 1922, and says credit should be given for all expenses up to that date.”

After considering the testimony on the issue'submitted to him, the master sets forth in his report an elaborate account of items, which it is unnecessary to here set forth in detail. He states the total indebtedness of the district to the 'contractor in the sum of $33,129.62, and allows the district a credit of $7,922.50, leaving a net balance due the contractor by the district of $'25,207.12. The .plaintiffs and District No. 17 filed exceptions to the following items of the master’s report:

“ (1) To the allowance of item No. 87 for $319, covering the traveling expenses of Jacobson and Flanagan on trips south. (2) To the allowance of $6,800 for rent or usable value of dredgeboat from July 15 to October 10. (3) To the allowance of $4,800 covering the rent or usable value of dredgeboat from October 10 to December 10. (4) To the allowance of $833.32 covering the item of supervision or overhead from October 10 to December 10. (5) To the allowance of $708.20, the amount of the insurance premium covering insurance on the boat from July 16 to December 10. (6) To the allowance of item No. 81, $68.30, covering traveling expenses of Toleff Jaco'bson to Chicago. ’ ’

The district also excepted and objected to the allowance of any of the items set forth in the master’s report-as against it, on the ground that all proof taken before the special master on the statement of the account showed that the Harding Construction Company is a Minnesota corporation, and, at the time of the making of the repairs Ujpon the boat and the expenditures of the items which are charged" to the drainage district, the Harding Construction Company, which made the repairs, wlas doing business in violation of the laws of the State of Arkansas, the same being a foreign corporation which bad not been authorized to do business in the State.

The cross-complainants excepted to the report of the master on the following- grounds:

(1) No allowance is made in favor of the cross-plaintiffs for the accrued interest on the $450,000 worth of bonds which Drainage District No. 17 sold and refused to deliver to cross-plaintiffs. (2) The master did not allow the cross-plaintiffs the rental or usable value of the dredgeboat up to the time of the sale of the same. (3) The report does not allow the cross-plaintiffs anticipated profits on the contract for the construction work, which Drainag'e District No. 17 repudiated and refused to carry out.

On the 27th of September, 1926, the court entered the following decree:

“ On this day, September 27,1926, this cause coming on to be heard, came the plaintiffs, W. IT. Baker et al., by their attorneys, Little, Buck & La.sley, and defendants, Drainage District No. 17 et al., by their attorneys, Charles T. Coleman and Little, Buck & Lasley, and the defendants, J. T. Flanagan et al. (who are also cross-plaintiffs), by their attorney, J. T. Coston, and this cause was heard on the exceptions of Drainage District No. 17 and its directors, and the exceptions of the cross-plaintiffs to the master’s report, and, upon due consideration of the same, it is considered, ordered, adjudged and decreed that all said exceptions to the master’s report be and the same are hereby overruled; to which action of the court in overruling their exceptions to said report said Drainage District No. 17 and its directors excepted at the time, and said cross-plaintiffs, J. T. Flanagan et al., excepted at the time to the action of the court in overruling their exceptions to the master’s said report.
“It is further considered, ordered, adjudged and decreed that the complaint of the plaintiffs, W. TI. Baker and E. H. Sheppard, be and the same is hereby dismissed.
“It is further considered, ordered, adjudged and decreed that the cross-plaintiffs, J. T. Flanagan, J. R. MoGtibbon, Toleff Jacobson, Andrew Jacobson, J. O. Shuland, A. Gr. Shuland and Harding Construction Company, do have and recover of and from Drainage District No. 17 of Mississippi County, Arkansas, the sum of $32,515 (the amount found due by the master, with interest thereon), and all cost, including a fee of $1,000 in favor of Hon. Archer Wheatley for his services as master, but the respective interests of said cross-plaintiffs in the recovery are not hereby fixed or determined.
“It appearing that in the original decree herein rendered on the.................jday of.............................., 1923, there was a finding that cross-complainants, J. T. Flanagan et al., were not entitled to any damages for anticipated profits on the construction contract or for breach of contract for sale of the bonds, but there was no formal dismissal of the cross-complaint with reference thereto, said cross-complaint with reference to said features- is dismissed for want of equity, exceptions of cross-complainants thereto being saved.
“It is further considered, ordered and adjudged that this decree sháll draw interest from this date until paid at the rate of 6 per cent, per annum, and R. C. Rose, C. E. Crigger and B. A. Lynch, the present board of directors of said Drainage District No. 17, be and they are hereby ordered, directed and "required to issue all vouchers, checks or warrants necessary to satisfy this decree, with costs.
“To which judgment and decree of the court Drainage District No. 17 excepted at the time, and prayed an appeal to the Supreme Court, which is granted.
“To which judgment and decree of the court the cross-plaintiffs excepted at the time, and prayed an appeal to the Supreme -Court, which is granted.”

1. The appellants contend that District No. 17 is liable to Flanagan in damages for anticipated profits for breach of. a valid contract entered into between the district and Flanagan for the digging or construction of Improvement No. 48. But appellees contend that the decree of 1923 was final and conclusive of that. issue, since there was no appeal from that decree within the time prescribed by law. In other words, the appellees contend that the appeal lodged here on the issue as to anticipated profits should be dismissed. That issue therefore must be determined in limine.

Section 2129 of C. & M. Digest provides as follows: “The Supreme Court shall have appellate jurisdiction over the final orders, judgments and determinations of all inferior courts of the State,” etc.

The above provision is § 15 of the Civil Code, as amended by the Acts of 1871, the words “and determinations” and £‘inferior courts of the State” being added by the Legislature of 1871. This court has always held, before and ever since the adoption of the Code (1869), that, where there is no final judgment, no appeal lies, and that an appeal will be dismissed for want of a final judgment. See Adams v. Owens, 1 Ark. 135; Bailey v. Ralph, 4 Ark. 591; Campbell v. Sneed, 5 Ark. 398; Ex parte Hawley, 24 Ark. 596; Mirror v. O’Brien, 36 Ark. 200; Davie v. Davie, 52 Ark. 224, 12 S. W. 558, 20 Am. St. Rep. 170; Davis v. Hale, 114 Ark. 426, 170' S. W. 99, Ann. Cas. 1916D 701; Darbin v. Montgomery, 144 Ark. 153, 221 S. W. 855, 223 S. W. 17. Other cases are cited in 1 Crawford’s Arkansas Digest, at page 130. But this court has likewise always held, and it necessarily follows, that, under the above statute, an appeal will lie and must be taken from a final decree within the time prescribed by statute for the perfecting of appeals. So the issue on the motion of appellees to dismiss the appeal of appellants, as to anticipated pro-fits is whether or not the decree of September 24, 1923, is final.

What is a final decree? This court, in numerous cases, beginning as early as Campbell v. Snead, supra, and on down as late as Temple Cotton Oil Co. v. Davis, 167 Ark. 449, 268 S. W. 38, has held that an order overruling or sustaining a demurrer to a pleading without further action is not' appealable. See also Moody v. Jonesboro, etc. Ry. Co., 83 Ark. 371, 103 S. W. 1134; Fairview Coal Co. v. Ark. Central Ry. Co., 153 Ark. 295, 239 S. W. 1058.

This court, in Campbell v. Snead, supra, in giving its reasons for declaring such a judgment not final, said:

“Because it neither in form nor effect dismisses the parties from the court, discharges them from the action, or concludes their rights in respect to the subject-matter in controversy in the case; and no proceeding in court, not attended with at least one of these consequences, can, in our opinion, be considered as embraced by the law allowing’ ‘writs of error upon any final judgment or decision of any circuit court’.”

In State Bank v. Bates, 10 Ark. 633, we said:

“A judgment, to be final, must dismiss the parties from the court, discharge them from the action, or conclude their rights to the subject-matter in controversy.”

And in Tucker v. Yell, 26 Ark. 420-429, we quoted Bouvier’s definition of a final decree as follows: “A

final decree is that which finally disposes of the whole question so that nothing is left to adjudicate upon.”

It is further held in that case, quoting syllabus:

“In peculiar oases this court may decree as to certain defendants or property, while all the equities as to other defendants and property are reserved for further consideration; and yet this decree, as to certain defendants or property, may be final. If, in the course of the proceedings, final decrees vital to the interests of any of the litigants are made, an appeal may be had. ’ ’

In Marlow v. Mason, 117 Ark. 360-362,174 S. W. 1163, we quoted the language quoted from the case of State Bank v. Bates, supra.

In Davie v. Davie, supra, it is said: “But the unnecessary splitting of causes by courts of chancery creates confusion and difficulty in practice, and is condemned.” Citing cases, among them Tucker v. Yell, supra.

Learned counsel for the appellants cites and relies upon Arkansas cases to support his contention that the decree of September 24,1923, was not a final decree, and he cites numerous eases from other jurisdictions, which, he also maintains, support his contention, if the court desires to pursue its investigation further than our own decisions. We have examined all the cases on this issue from our own court cited and relied on by counsel both for appellants and appellees, and find it unnecessary to investigate the decisions of other courts; for we have concluded that the issue is clearly settled against the appellants by decisions of our own court. This court lias never departed from the doctrine announced in Campbell v. Sneed, State Bank v. Bates, and Yell v. Tucker, supra, to the effect that, where a decree concludes the rights of the parties to the action in respect to the subject-matter in controversy in the case, it is a. final decree. That doctrine, announced so early, has 'been reaffirmed expressly and in legal effect in all subsequent cases.

In Davie v. Davie, supra, a leading case on the subject, it is said: “An appeal is allowed also where a distinct and several branch of the case is finally determined, although the suit is not ended.” See also Seitz v. Meriwether, 114 Ark. 289, 169 S. W. 1175, where it is. held, quoting syllabus: “A decree which disposes of all the matters in issue between the parties and gives all consequential directions necessary to carry it into execution, is a final decree. ’ ’

In Young v. Rose, 80 Ark. 513, 98 S. W. 370, it is said:

“A decree which settles the rights of parties and leaves nothing to the master but a statement of an account on a basis fixed by the decree, is a final judgment. A report of a master is not subject to exceptions when it simply follows the decree directing the reference and makes a report based on findings contained in suoh decree, as, if there be error, it is in the original decree, and not in the report of the master, whose duty it was to obey the decree.”

In the comparatively recent case of Newald v. Valley Farming Company, 133 Ark. 456, 467, 202 S. W. 838, 841, we quoted from McGourkey v. Toledo & Ohio Central Ry. Co., 146 U. S. 536, 13 S. Ct. 170, 36 L. ed. 1079, as follows:

“It may be said in general that, if the court make a decree fixing the rights and liabilities of the parties, and thereupon refers the case to a master for a ministerial purpose only, and no further proceedings in a court are contemplated, the decree is final; but, if it refers the case to him as a subordinate court and for a judicial purpose, as to state an account between the parties, upon which a further decree is to be entered, the decree is not final.”

And also, in the same case from Jones on Mortgages, vol. 3, par. 1600, the following:

“A judgment which settles all the rights of the parties and directs a sale of the premises, and that the defendant pay any deficiency which may arise after such sale, is a final decree from which an appeal may be taken; though, in a limited sense, it is interlocutory, inasmuch as further proceedings are necessary to carry it into effect. It leaves nothing further to be adjudicated. ’ ’

In Lewisburg Bank v. Sheffey, 140 U. S. 445,11 S. Ct. 755, 35 L. ed. 493, it is said:

“Where the entire subject-matter of a suit is disposed of by a decree, the mere fact that accounts remain to be adjusted and the bill is retained for that purpose, does not deprive the adjudication of its character as a final and appealable decree.”

Now, when the above rule of o.ur court and of the Supreme Court of the United States is applied to the decree of September 24, 1923, it is impossible to escape the conclusion that the same was a final decree on the issue as to whether Flanagan and his associates were entitled to recover anticipated profits by reason of the alleged breach of contract on the part of the district for the construction of No. 48. It must be remembered that this issue was not determined on demurrer to the answer and cross-complaint of appellants, but on the merits of the issue as raised by such answer and cross-complaint after the allegations thereof had been denied by the plaintiffs and after proof on the issue thus raised had been fully developed. The recitals of the decree show that it was rendered on final hearing and determined on this issue. We will not set out again all of the recitals of the decree. The court, after finding that the original contract was valid, found that the district was entitled to rescind the same on account of impossibility of performance, and that it was only liable to Flanagan and his associates for the expenses incurred in making preparations to perform the contract up to the time that he was notified by the district that it would not carry out the contract, including all damages sustained by him in connection with the performance of the contract to that date, but “not including anticipated profits on materials not furnished or work done.” The decree recites: “Wherefore it is considered, ordered, adjudged and decreed that the injunction heretofore issued restraining the parties from carrying out the contract referred to be and the same is hereby made perpetual.” In other words, the court found that the appellants could never recover from the district any damages by way of anticipated profits, and entered a decree so holding. A reading of the whole decree will show that it was a final disposition of that issue. Nothing whatever was left to be determined concerning such issue. On the contrary, the court, by expressly reserving other issues and giving the master specific directions to take proof and make his report at a future term of the court with reference to the sole and only issue submitted to him as designated in the decree of September 4, 1923, completely, without reservation, and finally disposed of the issue of anticipated profits for alleged breach of the contract for the construction of No. 48. After entering the decree in this form, it was wholly immaterial that the court did not have the decree recite that the complaint of the appellants on the issue of anticipated profits was dismissed. If the cause on this issue had been disposed of by sustaining a demurrer to appellants* cross-complaint, then, in order to make the decree final, it would have been necessary for the record of the decree to recite that the appellants, cross-complainants, stood on their cross-complaint, and that the same was dismissed. But, as already stated, the cause on this issue was not determined on demurrer to the cross-complaint, but the issue was joined by answer to the allegations of the cross-complaint and fully developed by the taking of testimony, and finally submitted and determined on its merits. Therefore the decree as actually rendered was tantamount to a dismissal of appellants’ cross-complaint on the issue of anticipated profits, and as completely and effectually disposed of it as if there had been a formal recital in the decree dismissing the cross-complaint for want of equity; because • all parties were forever restrained from carrying out the contract for construction of No. 48, and it was decided that the appellants were not entitled to damages by way of anticipated profits because the district would not allow the appellants to complete the construction of No. 48 under the contract. The issue therefore as to anticipated profits for this alleged breach of contract was finally disposed of by the decree of 1923.

Both the master and the court itself so construed the decree. The report of the master states that “he was appointed with directions to state an account on the (basis of the actual loss sustained by the contractor, without considering any anticipated profits whatever,” ancithe recitals of the decree of 'September 27, 1923, in which the court states: “It appearing that, in the original decree herein rendered on the ........... day of .................................... 1923, there was a finding that cross-complainants, J. T. Flanagan et al., were not entitled to any damages for anticipated profits on the construction contract or for breach of contract for sale of the bonds, but there was no formal dismissal of the cross-complaint with reference thereto, ’ ’ etc. After the lapse of the term when the decree on the issue of anticipated profits was rendered, that decree became final. Spivey v. Taylor, 144 Ark. 301, 222 S. W. 57. When therefore the appellants failed to perfect their appeal from the decree of the court on the issue of anticipated profits within the six months prescribed by § 2140 of C. & M. Digest, they forever lost their right to prosecute an appeal on that issue. Consequently their so-called appeal on that issue must be, and is, hereby dismissed.

' 2. It is next contended by appellants that the district is liable for accrued interest on $450,000 worth of the bonds which appellants allege the district sold and refused to deliver to appellants. On the 15th day of July, 1920, the district entered into a contract with J. R. McGi'btoon for a purchase of $450,000 worth of bonds of the district bearing interest at the rate of 6 per cent, payable semi-annually, land to toe dated August 2, 1920. The contract was assigned to Jacobson. The purchaser was to pay for the bonds in the sum of $450,000 for Improvement No. 48, as the payrolls for the construction of such improvement were due. The appellees contend that the construction contract is voidable because it was not let publicly, as the statute requires, and further, that the .construction contract was excessive, and therefore voidable ; and still further, thjit the construction contract and bond contract were coupled and interdependent, and therefore voidable.

We have considered the testimony in the record bearing upon these contentions of the appellees, tout we do not set out and discuss it, because it is exceedingly voluminous and would unduly extend this opinion to do so. Besides, it is wholly unnecessary to do so, inasmuch as we have concluded that, if these contentions of counsel for appellees were unsound, still there could be no recovery by the appellants for breach of the bond contract for two reasons: (1) 'because the undisputed evidence shows that the district was released by the Jacobsons from the obligations of the 'bond contract; (2) if the district was not released from the bond contract, and if there was a breach of the contract, nevertheless there could be no recovery of damages, because the appellants sustained no loss on account of such breach.

The facts, briefly stated, on the alleged breach of the ‘bond contract are substantially as follows: The district had made a tentative agreement with Carbough & Company, ’bond buyers, of Chicago, for the purchase of $2,330,000 worth of bonds, but the tentative purchasers were unwilling to take any of the bonds of the district unless $450,000 worth of bonds which the district had contracted to McG-ibbon were included in the purchase. Lange, the secretary of the district, arranged a meeting in Chicago with Jacobson for the purpose of arranging for the sale of the bonds of the district, including tlie 'bonds contracted to McG-ibbon. The result of the meeting was that the Jacobsons agreed that “if they were relieved of the burden of purchasing $450,000 worth of bonds at par, a reduction should be made in the contract price for constructing No. 48. ’ ’ They were relieved, and the bonds that were to be purchased by the Jacobsons were sold by the district on November 9, 1921, to 'a St. Louis syndicate at 85c on the dollar. While Lange testified that the district and the Jacobsons never reached an agreement about the extent of the reduction that the board should receive on the construction contract, there is no uncertainty in his testimony, and no contradiction thereof, that the Jacobs one were relieved, by agreement with the district, of the obligations of the contract for the purchase of the bonds. The substitution of this new contract, by oral agreement concerning the purchase of the bonds, necessarily relieved both parties from the obligations of the original contract for the purchase of bonds. Furthermore, the testimony shows that, during the time negotiations were pending for their sale and purchase, the bonds had a market value ranging from 85c to 93c, or an average market value of about 90c. The district notified the contractor, October 10, 1921, that the contract for the construction of Improvement No. 48 would not be carried out. The bonds were to be dated August 2,1920, and they bore interest at the rate of 6 per cent, per annum, payable semi-annually, therefore fourteen months’ interest had accrued at the time the contract was repudiated. If there was a breach of the contract for the purchase of the bonds, the damages for such a breach should be estimated as of the time the breach occurred, because the right of action, if any, accrued at that time. Now, if the Jacobsons had been required to take the bonds, they would have had to pay $450,000, but the market value of the bonds at the time of the alleged breach of contract for their purchase, calculated 93c on the dollar, the highest estimated market value shown by the evidence, would be $4.18,000; this, including the interest on $450,000 (which the Jacobsons were entitled to) from August 2, 1920, the date of the bonds, to October 10,1921, the date of the alleged 'breach of contract, would amount to $31,500 which, added to $418,000, would make the market value of the bonds and the interest equal to $449,500. Therefore, by simple mathematical calculation, it is demonstrated that Jacobson was not damaged by breach, if any, of the bond contract, but, on the contrary, he gained instead of lost .by such breach.

3. This 'brings ús, in conclusion, to determine Avhether or not the court erred in overruling all exceptions to the master’s report and in rendering judgment against the district in the sum of $32,515.

In its decree of 1923 the court found that the contract for'the construction of No. 48 was valid, but that the district subsequently became entitled to rescind the contract on account of legal impossibility of performance, and directed the master to ascertain the expense that Flanagan, the contractor, had incurred in necessary preparation to perform and carry out the contract, and also the contract price of any work done by him, including any damage sustained 'by him in connection with the performance of the contract to the date when he was notified that the district would not permit him to carry out the contract.

Counsel for appellants and appellees have favored the court with an exceedingly elaborate brief on the issues as to whether or not the construction contract was valid when entered into, and also on the issue of Avhether, if valid, the district had the legal right, under the act February 23, 1920, to abandon the performance of the contract.

Here again we regard a decision of these issues as Avholly immaterial, and Ave therefore pretermit a discussion thereof, for the reason that we are convinced that the district is liable to the contractor on the matters involved in the issue referred to the master, under the plainest principles of equity, whether the district had the discretion to abandon the contract or not.

Flanagan and the district entered into the contract believing the contract was valid. Flanagan made preparations for, and entered in good faith upon, the performance of the contract, and was engaged in such performance when he was notified by the district that it would not further perform the contract on its part. Conceding, without deciding, that the district had a perfect right to thus repudiate the contract, equity would not allow it to do so without reimbursing the' other party to the contract for the necessary expense incurred by him in the performance of the same.

“If a party calls upon a court of chancery to put forth its extraordinary powers and grant him purely equitable relief, he may with propriety be required to submit to the operation of a rule which always applies in such cases to do equity in order to get equity.” Spring F. Company v. School Fist. No. 4, Faulkner County, 67 Ark. 236, 54 S. W. 217. In McMillan v. Brookfield, 150 Ark. 518, 234 S. W. 621, we said:

“This suit is in equity, and the court has the right to impose conditions upon the plaintiffs in granting them the relief prayed for. ITe who seeks equity must do equity, is a favorite maxim. In the broadest sense it is regarded as the very foundation of all equity and as the source of every doctrine and rule of equity jurisprudence. Its practical meaning is that, whatever be the nature of the controversy and of the remedy demanded, the court will not give equitable relief to the party seeking it unless he will admit and provide for all the equitable rights, claims and demands of his adversary growing out of, or necessarily involved in, the subject-matter of the controversy. I Pom. Eq. § 385.” See also Grider v. Driver, 46 Ark. 64; Comstock v. Johnson, 46 N. Y. 521; Hitchcock v. Galveston, 96 U. S. 350, 24 L. ed. 659, and other cases cited in appellant’s brief.

Under all the circumstances disclosed by this record, it occurs to us that it would be rank -injustice upon the part of the district to fail to remunerate Flanagan and his associates for their necessary outlay in endeavoring in good faith to perform the contract on their part, even though the district was justified in abandoning the same. As a part of .said outlay, the master correctly concluded, that the contractor should he allowed at least sixty days to rearrange its affairs land should be reimbursed the amount necessarily expended in doing so. It must be remembered that this was a stupendous project, and a sudden termination of the contract made it necessary for the contractor to incur a large expense in readjusting his affaii's to. meet the situation caused directly by the act of the district in repudiating its contract.

But the appellees contend that the Harding.Construction] Company was in fact the real party in interest in this litigation, it being the exclusive owner of the contract and the real contractor which was to do the construction work. One of the exceptions of the appellees to the master’s report is that the Harding Construction Company is a Minnesota corporation, and .was. doing the business contemplated by the contract under review in violation of the laws of Arkansas, not being authorized to do business in the State. Conceding thát the Harding Construction Company was the reial party in interest, the trial court did not err in overruling this exception to the master’s report. This, in effect, was a plea in abatement, or rather a plea in bar, of the appellant’s action as set forth in their answer and cross-complaint, and the appellees should have entered their plea in their answer to such cross-complaint or by special plea'in bar at the beginning of the lawsuit, instead of at the end thereof. About two and. one-half years after the district filed its answer denying the allegations of appellant’s cross-complaint, and after proof on the merits of the issues thus joined had been taken, the original plaintiffs in the action file an amendment to their amended complaint, alleging, for the first time, that the Harding Construction Company was not qualified to do business in Arkansas. This wias too late for a plea in abatement, or in bar of the action. The appellees must be held to have waived the incapacity of the Harding Construction Company to maintain its cross-action by answering this cross-complaint and permitting the proof to be developed on the merits, without raising the issue of incapacity of the cross-icomplainant, Harding Construction Company, to maintain the action. See § 1189, C. & M. Digest, subdiv. 2; also § 1192, C. & M. Digest. See also Pettigrew v. Washington County, 43 Ark. 41; Files v. Reynolds, 66 Ark. 316, 50 S. W. 509; Triggs v. Ray, 64 Ark. 151, 41 S. W. 55, and cases from other jurisdictions cited in brief of counsel for appellant.

The master was a former chancellor of the district, and his report and its exhibits cover fifteen pages of the record. It could serve no useful purpose to set out and discuss the evidence upon which the master based his findings, as only questions of fact are mainly involved. The report of the master shows that he was thoroughly capable, and that he apprehended fully the directions of the court. He made a painstaking and exhaustive examination of the evidence already in the record, and took further testimony on the issue submitted to him.

After a careful consideration of the master’s report, we have reached the conclusion that the same is correct, and that the trial court did not err in overruling all the exceptions thereto, and did not err in approving the same and rendering* a decree in accordance therewith. We find no error in the entire record calling for a reversal of the decree, and the same is therefore affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    Arkansas Short Line v. Bellars.
    Opinion delivered January 30, 1928.
    1. Railroads — pedestrian using track. — An adult woman walking upon a railroad track in preference to using a path alongside the the track, was not an invitee hut a bare licensee in using the track, and refusal of an instruction on contributory negligence was reversible error in an action for injuries resulting from being struck by a motor car.
    2. Railroads — duty to mere licensee. — Railroad company owes to trespassers and bare licensees no affirmative duty to care, and the only requirement is that the railroad must not willfully or wantonly injure them and must exercise ordinary care not to injure them after discovering- their peril and inability to escape.
    Appeal from Poinsett Circuit Court; G. E. Keck, Judg’e;
    reversed.

      Denver L. Dudley and N. F. Lamb, for appellant.

      M. P. Wat,kins and Aaron McMullin, for appellee.
   Wood, J.

Two suits were filed in the circuit court of Poinsett County, one by Ollie Bellars and.J. J. Bellars, husband of Ollie Bellars, the other by Jennie Tankersley and her husband, Thomas Tankersley. The two cases were consolidated and tried as one case. There was a verdict for each of the women plaintiffs for $5,500 and a verdict against the husbands. Motion for new trial was filed by defendants, overruled, and appeals taken.

The Tankersley case has been settled, and there is now only the case of Mrs. Bellars to be decided.

The plaintiff alleged, in substance, that she was in • good health and perfect physical condition; that defendant, Arkansas Short Line, is a railway corporation; that on August 1, 1926, without fault or negligence on her part, she was struck and run over by a motor-car operated by defendant, Rufus Walters, an employee of the Arkansas Short Line, while he was in the line of his duty; that she was upon and about to cross the railway track within the city limits of Truman, Poinsett County, Arkansas, and at a point where the track had for a long time been used by pedestrians for the purpose of passing along or across the track; that such use of the track had been of long duration, open, notorious, and well known to defendants; that, while she ivas upon the tracks, defendant Walters wrongfully, carelessly and negligently ran a motor car against her, breaking and fracturing- her leg, etc.;.that the injuries so received were permanent, etc.; that Walters was operating the motor-car in a careless and negligent manner, in that he was running it at a dangerous and reckless speed, and did not keep a lookout, and did not make any effort to avoid striking plaintiff after discovering- her peril; that he gave no alarm or warning’; that it was at a point where he knew the track was frequently used hy pedestrians.

Defendants answered* denying all the material allegations of plaintiff’s complaint; alleged that plaintiff was a trespasser without knowledge or consent of defendants; that plaintiff was guilty of contributory negligence.

The appellee testified that she lived at Truman, and, on August 1, last year, she and Mrs. Jennie Tankersley were going to her daughter’s. It was a little after eight o ’clock p.m. They went on the railroad track, and turned up the track toward town. They were walking between the rails when a motor-car hit her. Somebody hollered: “It was a motor car,” and appellee started to get off. She testified that it hit her on the leg and head and rendered her unconscious. When the man hollered, she tried to jump off. Before she was hit she was in good health, but now her leg hurts her all the time. She is 48 years old. Before she went on the track she looked down the track and did not hear or see any trains. There is a path that goes up onto the railroad track. She went up there. Children went that way to school. Appellee had often walked-on the track before, and others did too. People walked that way to town every day. Witness does not remember the path just south of the gravel road and right by the side of it. She just knows that they always went the other way because everybody else did. At the sides of the railroad and at the end of the ties there are two level, well-beaten paths, one on one side of the track and one on the other side. Witness testified that she got between the rails, as she met a man who went past her, and that he hollered, “Look out, here comes a motor-car.” She had not heard the motor-car. The path along the gravel road was not a well-beaten, smooth one. There were weeds on either side, and they couldn’t get along that path for that. They did not hear any motor-car that night. It was dark.

Mrs. Jennie Tankersley testified that she was on the track with Mrs. Beliars, and they started out about seven-thirty; walked up the track for a bit; could not walk down on the side of the road because it had been raining. That everybody walks on the track that wants to. That they passed a man, and he told them that they had better get off the railroad, that a motor-car was coming, and, just as they went to step off, the car struck them. It threw witness one way and appellee another. Witness did not knoifr that they ran any trains on that road on Sunday. This was Sunday night. There was a little path on each side. They had walked that way before, and everybody that wanted to walked it. It was the ordinary way for them to go. Children, men and' women went that way. Witness had seen others on the track when she was on it. They had not heard a motorcar until the man hollered. Witness looked both ways. Mr. Walters, who operated the motor-car, came to witness, asked her if she was hurt, and told her he was trying- to get home in time to put into headquarters the story about the wreck they had on the road the day before. He said he was going pretty fact. Witness did not know how far he went after he hit her before he stopped. Everybody walked on the railroad. Does not remember a little path along- the road. Can’t say that the path along the south side of the gravel road isn’t a smooth and well beaten path used by pedestrians. All the path witness ever saw along the railroad was in the middle of the track. Mrs. Bellars said witness stepped up on the railroad track about the same time. They had walked on the railroad about the distance of the court room before being struck.

W. F. Webb, a farmer, testified that he had been to Memphis, and was returning home along’ the railroad track; saw ho was going to meet a couple of ladies, and heard a noise coming. It was very dark, and there was quite a little driving on the hard road. It had been raining that day. It made it pretty dark, but you could tell how'to walk. When witness got close to the ladies they saw him, and stepped up on the center of the track. Witness kept listening, and finally decided what he heard was a motor-car. It must have been seventy-five or eighty feet from him, and he iconld see the bulk of something, but knew from the noise it was a motor-car. Witness saw that the ladies had not discovered the noise, and he called to them and told them they were going to get hit. One of them started to the right and one to the. left. Another step would have put them off the track. Witness stopped and looked, and it looked like they went up five feet high. .The car ran on up to a little crossing, and the man operating it came back as quickly as he could. Witness did not know how fast the motor-car was coming, but at a pretty, good gait. It looked to witness like it was going around twenty-five miles an hour. Did not see that any apparent effort was made to stop it before it hit the ladies. Witness thinks that most of the-people from Mr. Stacy’s to Mr. Moose’s walk the railroad more than they do the dirt road. You will see school-children and Singer men walking the track, either on the side of the track or between the track. Witness had not passed the women when he hollered at them. In going from Stacy’s crossing to Lovell’s store you will ¡see them walking all the places. Witness did not hear any conversation between Mr. Walters and Mrs. Tankersley. Motor-cars don’t have any signal that witness knows of. Witness used the railroad track all of the time.

A number of other witnesses testified substantially the same as the witness whose testimony is set out above, with reference to people walking on the track at this particular place.

The motor car had no light, and the accident occurred close to Truman, a town of three or four thousand people.

One witness testified that where the accident occurred was ninety feet from one of the streets.

E. S. Walters, one of the defendants, testified, in substance, that he was operating the motor-car and coming into town after he had finished his work. A cloud was coming up, and it began to look like rain, and witness started into town. He was one-quarter of a mile from Truman and within thirty or forty feet of some object, and he heard a man holler, and as he did, he could see the bulk of something, so he threw his car out of gear and threw on the brakes, and by that time hit the women. He went over to Mrs. Tankersley and asked her how bad she was hurt, and helped her up, and they got a doctor. To stop the car witness threw it out of gear and applied the brakes. It was dark, and he was looking ahead, because he did not want to hit anybody, and sometimes there were objects on track, and they have to go through that part of town very carefully. If a motorcar strikes something it will juimp the track. The car was a small one. There was nothing else witness could have done .after he discovered the people. The wheels slid on the rails. They were wet. A car cannot be stopped on a wet rail as quickly as on a dry one. Witness said he was coming between twelve and fifteen miles, an hour. He had been driving faster, but it was dark, and he could not see the rail or anything else. Had seen a few pedestrians every day up and down the road. The majority .of them walk on the side, each side of the track.

Witness had been with the company nineteen months. It was about eight o’clock or a little bit after when the car struck the women. He was not aware that there might be anybody on the track at night, but cannot say that he had ever been along- there at that time of night before. He was looking for any obstacle. Was running the car with caution, so he could stop it. Saw these people possibly 30 or 10 feet. That was as far as he could-see. He could stop'the car in 100 or 125 feet. Witness could not see the rails. Had no light, but did not expect people out at that time of the night.

There are several witnesses that testified for the defendant and corroborated Walter’s testimony as to the people using the track.

The defendants, in their prayer for instruction No. 1, asked the court to instruct the jury to return a verdict for the defendants. Among other prayers, they also as'ked instruction No. 8, as follows:

“If you find from a preponderance of the evidence that the plaintiffs came from their home on Smith Street, on the north side of the railway track, out to the track and between the rails, and were walking 'between the rails along the track when struck by the motor-car; that neár or adjacent to the railway and parallel with it was a gravel road; that upon the side of the road nearest the railway track was a pathway used by pedestrians; that on each side of the railway and at the end of the ties, but on the dump or grade, were well-beaten paths used' by pedestrians; and that, instead of using or walking upon the road or any of these paths, the plaintiffs, Jennie Tankersley and Ollie Bellars, without any necessity therefor, elected to walk between the rails, then, in so doing, they were guilty of contributory negligence, and cannot recover in this suit.”

The court refused above prayer for instruction,, to which the defendants duly excepted.

From a judgment in favor of the plaintiffs is this appeal. The cause as to Mrs. Tankersley has been settled pending this appeal, and therefore only the appeal of the defendant as to Mrs. Bellars remains.

Giving the evidence its strongest probative force in favor of the appellee, Mrs. Bellars, she was a bare licensee. She was not on the tracks under circumstances which constituted an implied invitation on the part of the railway company to use its tracks as a footpath.- The appellee herself and her companion, Mrs. Tankersley, both testified that there was a path on each side of the railroad tracks and a path leading up on the tracks “where everybody who wanted to walked — it was the ordinary way for them to go; children, men and women, went that way.” Nevertheless the railway company did not extend to them any invitation, either express or implied, to use its tracks for- a footpath. Travelers went that way purely from their own volition, because they thought it smoother or more convenient, and the railway company merely passively acquiesced in such use of it. While the railway company did not forbid foot travelers to use its tracks, it certainly did not invite them to do so by any conditions which it created causing the foot travelers to use its tracks.

In Mo. & North Ark. Ry. Co. v. Bratton, 85 Ark. 326, 108 S. W. 518, passengers going to and from the station were accustomed to use the roadbed for a short distance. The passengers, when they arrived at the depot, usually went along the tracks of appellant in going to the town of Leslie, which was some distance from the railway station. In that case we held that the jury were warranted in finding that Bratton was on the tracks by the implied invitation of the railway company.

In Moody v. St. L. I. M. & S. R. Co., 89 Ark. 103, 115 S. W. 400, 131 Am. St. Rep. 75, the railway company permitted its roadbed to obstruct-the natural drainage of water from an adjacent street so that it washed away the sidewalk, in consequence of which pedestrians used the railroad track as a footpath. Under these circumstances we held that foot travelers were using the railroad track as a highway by at least the implied invitation of the railway company.

In Arkansas-Louisiana Ry. Co. v. Graves, 98 Ark. 638, 132 S. W. 992, Graves, the plaintiff, was on a footpath crossing the railroad track that had been openly and notoriously used by the public as a crossing and as one of the approaches to the depot platform. -Those who used the .crossing did so, not only by permission, but upon the implied invitation of the company.

In all the above cases the parties injured had a right to be on the railway tracks because they were invitees or licensees. But no such circumstances exist in the case at bar. Appellee, as we have stated, was not on the railway tracks by invitation of the railway company. Appellee was on the railway tracks under practically the same circumstances as shown in the case of St. L. I. M. & S. R. Co. v. T'ucka, 95 Ark. 190-194, 129 S. W. 541, 542, wliere Judge Battle, speaking for the court, said:

“It was proved that the deceased and many others had for many years used a part of the railroad track upon which he was killed as a pathway, and had thereby acquired the right of licensees thereon. But this did not exonerate him from the perils of his situation while upon the track. * * * He was there without invitation and at Ills own peril, and was guilty of contributory negligence. There was no evidence that the appellant discovered him in time to protect him against injury, and his administratrix had no right to recover damages.”

Another case almost parallel on the facts, and precisely so in doctrine, is that of the C., R. I. & P. Ry. Co.v. Payne, 103 Ark. 226, 146 S. W. 487, 39 L. R. A. (N. S.) 217, where we said :

“The undisputed evidence shows that appellee was a mere or bare licensee. She was using the footpath upon appellant’s right-of-way for her own convenience, and not for any purpose connected with the business of appellant or for the common interest or mutual benefit of appellant and appellee. Appellant did no affirmative act to compel or induce appellee to use the footpath upon its right-of-way. It merely acquiesced in such use by appellee and the public. Under such circumstances it cannot be said that there was any implied invitation upon the part of appellant for the use of its right-of-way by appellee. Appellant therefore did not have to exercise ordinary care to make the pathway safe for appellee.”

Appellee was likewise on the track under the same circumstances as in the case of Todd v. Ry. Co., 106 Ark. 390-392, 153 S. W. 602. Todd was on the crossing, which was the usual route of pedestrians crossing the railroad track. It was the usual custom of people going in that direction to use that path over the railroad track. The court, in that case, at page 397 (153 S. W. 604), used the following language:

“This ease is unlike the cases where parties injured are upon the railway -company’s track or right-of-way not only by permission but upon the implied invitation of the .company. In such cases the railway company owes the duty of exercising ordinary care to avoid injury. Nor is it like the cases of travelers at a public crossing, where the right to use the public highway is not by permission of the company, but by virtue of the law. In all such cases the railway company owes to the traveler the duty of exercising care to avoid injuring him. But the present case is differentiated from the above by reason of the fact that the appellant here was not upon the track of the railway company at the time of the injury by reason of any invitation of the company, either expressed or implied. He was not about any business pertaining to the company, and, as already stated, he was a bare licensee.”

In many cases before the lookout statute, which does not apply here, this court has held that a railroad company owes trespassers and bare licensees no affirmative duty of care, and only the duty not to' willfully or wantonly injure them, or the duty to exercise ordinary care not to injure them, after discovering their peril and inability to escape. To bare licensees railroad companies owe no affirmative duty of care, for such licensees take their license with the concomitant perils. Ark. & La. Ry. Co. v. Sain, 90 Ark. 278-284-285,119 S. W. 659, 22 L. R. A. (N. S.) 910; See also St. L. I. M. & S. R. Co. v. Pyles, 114 Ark. 218, 169 S. W. 580; St. L. I. M. & S. Ry. Co. v. Duckworth, 119 Ark. 246, 117 S. W. 1148; Mitchell v. Ozan-Graysonia Lumber Co., 151 Ark. 6, 235 S. W. 44; Knight v. Farmers’ & Merchants’ Gin Co., 159 Ark. 423, 252 S. W. 30.

In Knight v. Farmers’ & Merchants’ Gin Co., supra, we said:

“In all our decisions on the subject — and there are many — we have adhered to' the rule that one who goes upon the premises of another as a mere licensee is in the same attitude as a trespasser, so far as concerns the duty which the owner owes him for his protection; that he takes his license with its concomitant perils, and that the owner owes him no duty of protection except to do ,no act to cause his injury after his presence there is discovered.”

The above doctrine is firmly embedded-in the jurisprudence of our State, and thus far no case has arisen of peculiar or unusual circumstances calling for an exception or modification' of the doctrine, which in some jurisdictions is the case. See 3 Elliott on Railroads, § 1795 (1257) and cases there cited; 33 Cyc. 779-80, 22 R. C. L. 970; Mason v. Southern Ry. Co., 58 S. C., 36 S. E. 440; Southern, Ry. Co. v. Chapman, 124 Ga. 1026, 53 S. E. 693, 6 L. R. A. (N. S.) 283, 4 Ann. Cas. 675, where the Supreme Court of Georgia, through Judge Lumpkin, discusses the subject in a learned opinion. The case of Davis v. Scott, 151 Ark. 34-44, 235 S. W. 407, is not in conflict with the doctrine above announced in all our cases. Neither does that case state an exception or modification to the above doctrine of our cases. The case differs from the case at bar on the facts. Likewise the cases of St. L. S. W. Ry. Co. v. Mitchell, 115 Ark. 339, 171 S. W. 895, Ann. Cas. 1916E, 317; Cook v. Mo. Pac. Rd. Co., 160 Ark. 523, 254 S. W. 680; and Jonesboro, L. C. & E. R. Co. v. Wright, 170 Ark. 815, 281 S. W. 374, are not applicable here. The Mitchell case, supra, although a motor-car case, was nevertheless a public crossing case, and the Cook case and the Wright case were public crossing cases. These cases all arose since the passage of the lookout statute, § 8568, C. & M. Digest, and none of them are applicable here.

We do not mean to decide, and do not decide, that there may not be peculiar circumstances calling for modification or exception to the rule. It will be time enough to recognize a modification or exception to the rule when a case is presented that calls for a modification or exception. Here the appellee was an adult, in the full possession of all her faculties. She deliberately chose to walk: upon the railroad tracks to subserve her own convenience, when there were other ways she might have gone and been wholly free from danger of passing trains or motor-oars. The undisputed evidence shows that she chose this way because it was a way frequently traveled by pedestrians, and she deemed the same a more convenient or pleasant way to go rather than to pursue the paths along* the sides of the track that involved no danger whatever. Under such circumstances appellee is nothing more nor less than a bare licensee, and is not in an attitude to claim that, the appellant is liable to her under a modification or exception that might perhaps be made under other peculiar and extraordinary circumstances.

The record presents a typical case of a bare licensee, and, since the cause .must be reversed on this ground, we find it unnecessary to consider any other. It follows from what we have said that the court erred in refusing appellant’s prayers for instructions Nos. 1 and 8, set out above. For the error indicated the judgment is reversed, and the cause is remanded for a new trial.

Humphreys and Mehafpy, JJ., dissent'.


text:
    Fitzgerald v. Chicago Mill & Lumber Company.
    Opinion delivered January 30, 1928.
    1. Mortgages — trespass of mortgagor in cutting timber..— A mortgagor who cuts, removes and sells timber from the mortgaged property is a trespasser, though the whole proceeds were used in his farming operations and in minor improvements on the land.
    2. Mortgages — title of mortgagee. — The legal title to the land passes to the mortgagee, subject to he defeated by the performance of conditions of the mortg'age.
    3. Mortgages — rights of mortgagor in possession. — The mortgagor in possession of the land is entitled to take the annual crops and wood for fuel, and do any acts in carrying on the farm which are usual and proper in the course of good husbandry.
    4. Mortgages — willful trespasser in removing timber. — The mortgagor, in cutting, removing and selling timber from the mortgaged land without obtaining the consent of the mortgagee, is a willful trespasser-acting in bad faith.

      5. Mortgages — buyers of timber from mortgagor — liability.— Where a mortgagor was a willful trespasser in selling timber from mortgaged land, persons buying from him without actual notice of such .willful trespass, but with constructive notice of the mortgage lien, are held to have placed themselves in the mortgagor’s shoes as to liability for actual damages for conversion of the timber.
    6. Mortgages — effect of removal of timber. — Removal of timber worth $9,000 from mortgaged land held to impair the security of a second mortgagee.
    7. Mortgages — removal of timber — laches.—A second mortgagee was not barred by laches nor estopped by her conduct from making claim for the value of timber against the purchasers of timber removed from the mortgaged property by the mortgagor, and sold without the mortgagee’s knowledge, notwithstanding proof that the logs were stacked on the river bank before shipment.
    8. - Mortgages — removal of timber — burden of proof. — In an action by a mortgagee against the purchaser of timber cut from mortgaged premises, and removed without the mortgagee’s knowledge, the purchaser having constructive notice of the mortgage, held that the buyer has the burden of showing what amount, if any, of the proceeds of the timber was expended on the mortgaged property in conformity with good husbandry.
    9. Mortgages — wrongful removal of timber — liability.—The mortgagee is entitled to recover against the buyers of timber from the mortgagor selling same without authority from the mortgagee the amount paid by them to the mortgagor for timber sold with interest at the rate of 6 per cent, per annum from the date of conversion, where the buyers failed to show what amount, if any, was expended on the premises by the mortgagor in conformity with good husbandry.
    Appeal from Phillips Chancery Court; A. L. Hutch-ms, Chancellor;
    reversed.

      Gerald Fitzgerald and Rose, Hemingway, Cantrell & Loughborough, for appellant.

      Moore, Walher é Moore, for appellee.
   Wood, J.

Mrs. N. R. Fitzgerald instituted an action against R. L. Cobh and wife in the chancery court of Phillips County to foreclose a deed of trust executed by Cobb on a large plantation to secure an indebtedness to plaintiff of approximately $104,000. The deed of trust was subject to a prior deed of trust in favor of the Deming Investment Company in the sum of $110,000. The investment company was made a party defendant, but filed no answer. It was alleged that Cobb, tlie mortgagor, bad wrongfully . and unlawfully cut timber from the mortgaged premises and sold the same to the Chicago Mill & Lumber Company, and 'also cut timber from the mortgaged premises -and sold same to the Howe-Neely Lumber Company. The value of the timber alleged to have been sold to the Chicago Mill & Lumber Company was not set forth, and the plaintiff asked that that company be required to produce its books to enable the plaintiff to (ascertain the correct value of the timber sold to it. The value of the timber alleged to have been sold to the Howe-Neely Lumber Company was set down at $2,202.47. Judgment of foreclosure was prayed against the mortgagors, R. L. Cobb and wife, and for damages in the sum of three times the value of the timber removed and sold, and against the lumber companies for the value of the timber purchased by them from Cobb.

The only appeal here is by the plaintiff from the decree dismissing’ her complaint for want of equity as against the lumber companies. Therefore it is unnecessary to set out the answer of Cobb and wife, further than to say it denied that they had wrongfully and unlawfully cut and sold timber to the lumber companies. The Chicago Mill & Lumber Company answered, denying that it had, without lawful authority, purchased timber from Cobb, knowing that it had been cut and removed from the lands described, contrary to law, land denied that any timber sold to it by Cobb was grown on, or removed from, the property described, and denied that the quantity of timber sold to it by Cobb was unknown to the plaintiff, and denied that appellants should recover any amount for the timber. It alleged that it had purchased certain timber in the form of logs from Cobb which bad been delivered to it on the west 'bank of the Mississippi River, in dumps or piles, where it could be conveniently loaded on barges; that it was not responsible for the cutting and hauling of the logs to the river; that, when the logs were thus delivered to it, they- were no longer real estate, but personal property, and tbe plaintiff had no lien thereon; that the proceeds of the sale of the logs by Cobb were used by him in the making of necessary improvements on the property described in the deed of trust. It was alleged that the plaintiff and Cobb, on the 25th day of November, 1923, entered into a verbal agreement by which 'Cobb conveyed to the plaintiff the lands involved, the consideration being the release of the deed of trust; that Cobb,-pursuant to the agreement, surrendered possession to the plaintiff and tendered a quitclaim deed to plaintiff to the mortgaged premises; that, iat the time the verbal agreement was entered into for the surrender of the possession of the premises, the plaintiff knew that the timber had been removed and therefore she was estopped from claiming any damages therefor. It was further alleged that the Doming Investment Company had a prior lien on the mortgaged property in the sum of $121,000, which the plaintiff had not paid, and the failure to satisfy this prior mortgage was pleaded in bar of plaintiff’s right to recover against the lumber company. The Chicag’o Mill & Lumber Company also entered a demurrer to the complaint on the ground that it did not state a cause of action, and also on the ground that the plaintiff had not paid the prior indebtedness to the Deming Investment Company, and therefore had no cause of action for the removal of the timber by the mortgagor, Cobb.

The Howe-Neely Lumber Company answered and admitted that it purchased some logs from Cobb, but denied that the plaintiff had any interest therein,' and denied that it was indebted to the plaintiff in the amount prayed. It also denied that the logs purchased by it from Cobb were táken from premises on which the plaintiff had a mortgage. It denied that it had cut logs from any lands owned by plaintiff or Cobb, and alleged that the logs purchased by it from Cobb were delivered by Cobb to the defendant’s millyard at Helena.

The plaintiff replied to the answers, and pleaded the statute of frauds to defeat the alleged verbal contract of sale from Cobb to the plaintiff.

The undisputed, testimony shows that E. C. Nelson, the local manager of the Chicago Mill & Lumber Company, during the year 1923 purchased for the company from R. L. Cobb logs for which it paid the sum of $16,661.72. These logs were purchased under a written contract between the Chicago Mill & Lumber Company and Cobb, executed May 12, 1923. The logs consisted of cottonwood, gum, maple, and elm, and were to 'be delivered on the bank of the Mississippi River at or near Westover Landing, within easy reach of derrick boats at all stages of water, and were so delivered from June to October, 1923. The Chicago Mill & Lumber Company bad the rig*ht to claim the logs as soon as same were placed on the bank of the river at the place specified. The price to be paid for the logs thus delivered was $16 per thousand feet. Westover Place, on which Westover Landing above mentioned is situated, consisted of about 4,500 acres in the whole plantation, divided into several different small plantations included in this foreclosure. Westover Landing Was the landing for all the plantations comprising Westover Place.

The undisputed testimony by those living on the plantations comprising* Westover Place was to the effect that timber was cut from Westover Place for R. L. Cobb in the year 1923 between the river and the levee, and that this timber was delivered on the river bank near West-over Landing*. 'They began cutting the timber as soon as the water went down, and continued until the fall. Timber was cut on the places constituting Westover Place on the land side of the levee, or what is known as the “inside of the levee,” and the timber thus cut was hauled to Helena.

The undisputed testimony showed that the HoweNeely Lumber Company purchased timber from R. L. Cobb during the years 1922 and 1923 amounting to $2,209.47.

Without setting out the testimony in detail, we are convinced that the undisputed testimony shows that the timber purchased by both lumber companies from R. L. Cobb was timber cut by him, from the Westover Place. The testimony shows that the proceeds from the sale of the timber by Cobb were used in the farming operations of the place and in making some minor improvements, such as covering some of the houses. The price paid for the timber by the purchasers included the cutting and the hauling — everything that went into the cost of the timber and the cutting and delivering of the siame. Mr. and Mrs. R. L. Cobb, at the time of the foreclosure, owed the appellant the sum of $118,000. The land was sold under foreclosure and purchased by the plaintiff for-$10,000, and the undisputed testimony is that the foreclosure was subject to a prior mortgage in favor of the Deming Investment Company for $110,000. There is testimony in the record tending to prove that the West-over Place, after the removal of the timber, was worth from $160,000 to $175,000. -One. witness, A. C. Cobb, son of R. L. Cobb, testified that, in his opinion, the Westover Place was worth $275,000.

Another witness, Gerald Fitzgerald, who was familiar with the land, having purchased the same in 1917, gave it as his opinion that the value of the place was from $160,000 to $175,000. No one had made enough on the place to pay the debt due thereon, the cost of farming the same, and the taxes. The most valuable portion of the plantation was in timber. He had tried to help Cobb sell the place, and never could get an offer that would pay the first mortgage and the plaintiff’.s mortgage. One hundred and sixty-five thousand dollars was due on the place prior to the last loan made by the Deming Investment Company. The plaintiff had no knowledge of the cutting of the timber.

F. P. Fitzgerald, husband of the plaintiff, testified that Cobb offered to turn the place back by giving a quitclaim deed, but he would never agree to it when he found out about the timber having been removed from the place. Cobb was going to give it up, either by quitclaim deed or by foreclosure, and, when witness was discussing with Cobb concerning taking the place back for his wife by quitclaim deed from Cobb, Cobb said he had only cut what went on the place for repairs, and witness did not dream that more timber had been removed.

Mrs. Fitzgerald testified that she had no information that Cobb was cutting the timber, and never surrendered her right-therein to any one.

There is no testimony in the record tending to prove that the appellees had any actual notice that the timber purchased -by them from Cobb was timber on which the appellant had a mortgage, nor is there any testimony to ■ the effect that they had any knowledge that Cobb was selling them the timber without the permission of the appellant. The deed of trust or mortgage of Cobb and wife to the plaintiff was duly recorded before the timber was sold.

The above are substantially the facts upon which the trial court entered a general finding in favor of the appellees and a decree dismissing appellant’s complaint against them for want of equity, from which decree is this 'appeal.

1. The first question to be determined is whether or not R. L. Cobb cut the timber in controversy from land upon which the appellant at the time held a mortgage, and, if so, whether, in cutting such timber, he was a tres-passer. The decided preponderance of the evidence— indeed, practically the undisputed evidence — proves that the' timber in controversy was cut from the Westover Plantation, upon which the appellant at the time- held the second mortgage. Likewise the undisputed testimony shows that the proceeds were used by R. L. Cobb in farming operations and in doing some minor improvements on the land, such as covering several houses and the like. In this State the legal title passes by the mortgagor to the mortgagee, subject to be defeated b}^ the performance of the conditions of the mortgage. Danenhauer v. Dawson, 65 Ark. 126, 132, 46 S. W. 131, 44 L. R. A. 193, and oases there cited. Therefore the mortgagor, Cobb, would have no right to cut, remove, and sell the timber and use the proceeds of such sale in-his farming operations.

The affirmative testimony in the record is that the appellant did not consent to the act of 'Cobb in cutting and removing the timber in controversy, and there is no proof of circumstances to justify the trial court in concluding that the appellant had given her consent to the removal and sale of the timber. The doctrine in cases like this is well stated in Searle v. Sawyer, 127 Mass. 491, 494, 34 Am. Rep. 425, as follows:

“If a farmer mortgages the whole or a part of his farm, with a clause permitting him to retain possession, * * * it is within the contemplation. of the parties that he is entitled to take the annual crops and wood for fuel, and we do not think that the implied license is necessarily limited to the annual crops, but that it extends to any acts of carrying on the farm which are usual and proper in the course of good husbandry.”

It could hardly be said that the usual course of good husbandry justified Cobb in removing the timber from the freehold for purposes indicated in this case, and it cannot be reasonably presumed that the appellant gave her consent to such conduct of Cobb. We conclude therefore that the acts of Cobb were wrong in cutting*, removing, and selling the timber for the purposes shown, land such acts constituted him a trespasser.

2. The next question is, was R. L. Cobb a willful trespasser? He must be held to have known that he had no right to cut the timber, except such as was necessary in good husbandry, such as for fuel, for making and repairing fences, and the like, but certainly not for the purpose of paying his expenses of general f arming operations, such as the expense incident to the planting, cultivation and harvesting of his crops. Cobb was overwhelmed with debt; he was not able to make financial arrangements to conduct his farming operations, not even to pay his taxes, amounting to about $700. When negotiations were pending looking- to the surrender of possession of the plantation by Cobb, he was asked if he had cut any of the timber, and replied, “No, you know I wouldn’t do that — only for plantation purposes — for buildings- — only what went on the place for repairs.” A. C. Cobb himself, in his testimony, said that nothing was said about his fiather paying for the timber; that it was not discussed at all. He further stated that the Fitzgeralds knew “that the money my father had got out of the timber had been spent back into the crop. ’ ’ He says: “We -discussed what the money was used for.” Now, it occurs to us that, under these circumstances, the removal land sale of the timber by Cobb, without having first obtained the consent of appellant, constituted Cobb a willful trespasser. In other words, it must be held that his acts in removing and selling the timber were not in good faith. See Foreman v. Holloway & Son, 122 Ark. 341, 183 S. W. 763.

3. Such being the case, the next question is, what was the measure of appellant’s damages as lagainst the appellees? While appellees had no actual notice that Cobb was a willful trespasser in cutting and removing the timber, they had constructive notice of the mortgage, and therefore must be held to hiave known that the timber did not belong to Cobb. Therefore, in purchasing and .paying Cobb for the timber, instead of the appellant, they placed themselves precisely in Cobb’s shoes as to liability for actual damages in conversion of the timber. This court, in Central Coal & Coke Co. v. John Henry Shoe Co., 69 Ark. 302, 63 S. W. 49, passing upon a similar question in an opinion voiced by Mr. Justice Riddick, s'aid:

“The question here for decision is whether the defendant, who purchased the ties from the trespassers, and then converted them to its own use, is entitled to any reduction in the damages on account of the increase in value caused by the work and labor of the willful trespassers. We must answer this question in the negative. The timber belonged to the plaintiffs. The title to it was not changed by the trespass, or the conversion to cross-ties. It still belonged, in its improved shape, to the plaintiffs. Had Less & Watkins, who knowingly and wrongfully put labor upon these ties, been sued, they, as before stated, would have been entitled to an allowance or reduction of damages on account of the labor expended or value added to the timber, and could convey no such right to the coal and coke company. Admit that the company was an innocent purchaser, still it purchased property belonging to plaintiffs from those having no right to sell, it converted this property to its own use, and plaintiffs were, by this conversion, damaged to the extent of the value of the property at the time of the conversion. The company, it will be noticed, did not perform any work and labor on these ties, nor add any value to them. Under these circumstances we think the circuit judge correctly ruled that the measure of damages was the value of the ties at the time and place they were converted by the defendant company, with interest at six per cent, from date of conversion.” 'Citing cases. 'See also, in addition to the authorities from other jurisdictions there cited, Hudson v. Burton, 158 Ark. 619, 250 .S. W. 898, and other Arkansas cases there cited on page 622 (250 S. W. 899).

Of course the rule would have been different if Cobb had been merely a technical trespasser, innocent of any bad faith or intentional wrongdoing. See Randleman v. Taylor, 94 Ark. 511-513, 127 S. W. 723, 140 Am. St. Rep. 141, and cases there cited. Foreman v. Holloway & Son, supra; Baker-Mathis Lbr. Co. v. Bank of Lepanto, 170 Ark. 1146, 282 S. W. 995.

4. 'Counsel for the appellees contend that the conversion of the timber did not impair the security of the appellant. This contention cannot be sustained, for the reason that the undisputed testimony shows that 1,063,120 feet of logs were sold to the appellee, Chicago Mill & Lumber Company, for the sum of $16,661.72, and logs of the value of $2,209.41 were sold by Cobb to the HoweNeely Lumber Company. Thus Cobb removed timber from the freehold upon which the appellant had a mortgage, which timber in its converted form was of the aggregate value of $18,871.19. While A. C. Cobb testified that it cost $9,991.13 to remove the trees, that still leaves a margin of nearly $9,000 that the timber was worth to the freehold while standing. The removal of the timber therefore lessened the value of the mortgaged property and appellant’s security.at leiast to that extent. While A. C. 'Cobb testified that, in his opinion, the value of the land was $275,000, a decided preponderance of the evidence shows that he was mistaken in this conclusion. The debt to appellant for which the property was sold at foreclosure amounted to $118,606.54; the property was directed to be sold subject to the rights of the Deming Investment'Company; the Deming'Investment Company’s mortgage, principal and interest, amounted to more than $110,000. The property was sold under foreclosure order of the court at public sale to the highest bidder, and the highest and best bid at the sale was the sum of $10,000, which was the bid of appellant. To have obtained an unincumbered title, appellant would have had to pay the debt to the Deming Investment Company. She had the right to pay that debt and to obtain, all the security unimpaired that the investment company had under its mortg'ag’e. Whatever lessened the security of the first mortgage, necessarily lessened the security of the appellant. The property, under the law, did not belong to Cobb until the mortgage debts thereon were paid. It belonged to the mortgagee. Primarily the Deming Investment 'Company had the right to the security, but, if it did not elect to avail itself thereof, then the ajopellant had the right, in • the protection of its security, to hold the appellees liable for the value of the property which, by their purchase, they had enabled Cobb to convert to his own use, to the detriment of the appellant.

5. It is urged by the appellees that the appellant was estopped from claiming the value of the timber from appellees because she knew that it was being removed by Cobb, and made no complaint for a period of almost a year. While the testimony of A. C. Cobb ahd-R. E. Scott, the overseer on the plantation, shows that logs were .stacked on the river bank on the Westover Place during the velar 1923, and that Gerald Fitzgerald was over the plantation several times while the timber was banked there, yet the appellant herself testified that she had no information or knowledge that Cobb was cutting the timber on these places. Scott, the overseer, testified that he never saw the appellant on the place. F. P. Fitzgerald testifies that he had absolutely no knowledge of the cutting of the timber until after Cobb had surrendered possession thereof to appellant’s agent, Marley. Gerald Fitzgerald testified that he had no knowledge of the cutting of timber during the time same was being cut from' December, 1922, until October, 1923. Therefore we conclude that the preponderance of the evidence shows that the appellant was not barred by laches or estopped in any way by her conduct from making a claim for the value of the timber in controversy.

6. While the undisputed testimony of A. C. Cobb wias to the effect that the proceeds from the sale of the timber were used in farming operations and making minor improvements, such as covering houses and the like, he does not testify what amount was used in the way of the purchase of necessary fuel or in making the necessary repairs. In short, he does not testify what amount, if any, was used in the course of good husbandry. Cobb commingled the entire proceeds piaid him by the appellees for the timber. The burden was upon the appellees to prove what amount, if any, was expended on the plantation in conformity with good husbandry. A. C. Cobb was a witness for the appellees, and they were given an opportunity to develop the facts along this line, and presumably did not do so because they could not.

After a careful consideration of the entire record, our conclusion therefore is that the court erred in dismissing the appellant’s complaint against the appellees for want of equity. The trial court, instead, should have entered a decree in favor of the appellant against the appellee, Chicago Mill & Lumber Company, in the sum of $16,661.72, land against the appellee, IIowe-Neely Lumber Company, in the sum of $2,209.47, with interest at the rate of six per cent, per annum from date of conversion. The decree is therefore reversed, and the cause is remanded with directions to enter a decree in favor of the appellant against the appellee, Chicago Mill & Lumber Company, in the sum of $16,661.72, and against the appellee, Howe-Neely Lumber Company, in the sum of $'2,209.47, with interest at the rate of six per cent, per annum from the date of conversion.

Mehanfy, J., dissenting on measure of damages.