text:
    Davis v. Metcalf & Haley.
    Opinion delivered February 19, 1923.
    1. Brokers — jury question. — In an action against brokers for the excess for which they sold plaintiff’s land over the list price, and for the commission paid them, based on the ground that they fraudulently concealed the price paid and retained the excess, the question whether plaintiff agreed to allow defendants as their commission all they might receive over the list price held for the jury; hence it was error to direct a verdict for defendants.
    2. Brokers — agreement as to commission. — A broker may make a contract whereby he will be entitled to the difference between the price the seller agrees to accept and the amount the purchaser agrees to pay; but such a contract must be plainly expressed, in order to relieve the broker of the duty he owes his principal to make full disclosure concerning the terms of the negotiations.
    3. Brokers — fraud—jury question. — Whether brokers perpetrated a fraud on their principal by failing to disclose the fact that they had sold his land for a price in excess of the list price and appropriated the difference, held for the jury.
    4. Brokers — fraud—forfeiture of commission. — If a broker violates his duty to his principal and fraudulently misrepresents the facts concerning his transaction, and undertakes to derive any advantage therefrom to himself, he forfeits any compensation that would otherwise be due him, and all gain thereby belongs to his principal.
    Appeal from Lawrence Circuit Court, Western District; Dene H. Coleman, Judge;
    reversed.
    Appellant pro se.

      ■ The ease should have been submitted to the jury on the disputed question of fact as to whether or not tile plaintiff agreed to give the defendants all over the sum of $1,500. It is the duty of -a broker to make to his principal a full, fair and prompt disclosure of all the facts and circumstances affecting, fiis principal’s interests. Any advantage accruing to him by violation of this duty must be made good to the principal, and not only so, but he forfeits his compensation also. 126 Ark. 6Í; 196 Pa. St. 205; 79 Am. St. Rep. 702; 62 So. 254; 7 Ala. App. 358; 80 Atl. 164; 114 Md. 418; 165 N. W. 294; 36 Neb. 869; 55 N. W. 279; 113 Pac. 1133; 58 Ore. 195; 166 111. App. 402; 190 111. App. 493; 140 N. W. 892; 159 Iowa 424; 169 111. App. 456; 178 S. W. 566; 95 Minn. 350; 104 N. W. 543; 2 App. Cases (D.’C.) 387; 124 Mich. 417; 46 N. J. Eq. 595; 110 N. W. 1031; 133 Iowa 567. The burden of proof, in such cases, is on the agent to establish his fairness in the transaction. 48 Cal. 215; 1 Hun (N. Y.) 303; 2 Strob. (N. C.) Eq. 262; 22 F. J. Eq. 481. A broker guilty of fraud in executing his agency forfeits his riight to commission. 66 Kan. 427; 87 F. E. 70; 80 Kan. 515; 87 N. Y. App. Div. 518; 20 Pa. Sup. Ct. 369; 92 Fed. 32, 34 C. C. A. 190; 81 Conn. 623.
   Wood, J.

This is an action by the appellant against the appellees. The appellant alleged that in the fall of 1919 he placed in the hands of Metcalf & Haley, real estate brokers, certain lands for sale. The price fixed for the sale of the land was $1,500; that they were to receive ten per cent, commission for making the sale. They sold the land for the sum of $1,700, and prepared a deed to the purchaser in which they fraudulently concealed from the appellant the fact that the land had been sold for $1,700, and fraudulently represented that they had sold the same for $1,500. Appellant further alleged that by reason of the fraud and concealment lie had been cheated out of the sum of $200, and that appellees were not entitled to retain the sum of $150 which he had paid them as their commission. He prayed judgment in the sum of $350.

The appellees, in their answer, admitted that they sold the land for $1,700, but denied that they were to receive only a commission of ten per cent, of the purchase price. They alleged that, when the land was listed with the appellees, the appellant represented that Wilson Mercantile Company of Imboden had a lien on the land for $1,200, which would have to be paid when said land was sold, and that the appellant would have to receive the sum of $150 before he would execute a deed to his equity in the land, which was all the interest he owned therein, and that after these two amounts were paid the appellees could have, as their remuneration for selling the land, all it brought over and above those amounts, and that the land was sold under such agreement, and they had settled with the appellant on those terms. They therefore denied that they were indebted to the appellant in any sum.

The appellant testified in his own behalf that he was the owner of 160 acres of land which he listed with appellees to be sold for $1,500, and they were to receive ten per cent, commission for making the sale. Appellant ascertained later that appellees had sold his land for $1,700. He demanded the $200 which appellees had received over the price for which the land was listed, and appellees denied that such was the contract. Met-calf, with whom the appellant had the conversation, stated, “Oh, well, that is some of Mr. Haley’s doings. He is in the habit of pulling’ off that kind of a deal.” Witness asked Metcalf -what they were going to do about it, and he replied that they would straighten it up. Witness testified that one E. B. Sims and LeRoy Sims were present when they had this conversation, and Metcalf promised that he would settle it. The appellant signed the deed and received $50, but didn’t know at the time that the place was sold for more than $1,500. He after-wards discovered it when Sims came to see about the interest due on the mortgage, Sims then showed appellant the sale contract. Appellant received but $150 out of the sale.

There was testimony corroborating the testimony of the appellant to the effect that the appellant listed the land with the appellees to be sold for $1,500, and that the appellees were to receive ten per cent, commission for selling the same. Witness A. B. Sims also corroborated the testimony of the appellant as to the conversation with Metcalf after the sale was consummated.

Appellee Haley testified that he and Metcalf were partners in the real estate business, and that appellant listed with them 160 acres of land to be sold for $1,500, but afterwards it was agreed that they should receive all they could over $1,500. Appellant stated to witness that all he wanted was the sum of $150, and the buyer to assume the mortgage on the place in the sum of $1,200. Witness detailed the circumstances under which the contract between them was entered into. A contract was introduced in evidence between the appellees and one Sims, showing that the property was sold for $1,700. The testimony of the appellant tends to show that he had no knowledge that the contract specified that the land was sold for $1,700.

The appellant requested the court to instruct the jury to the effect that, if appellees sold the property for a greater sum than that fixed by the plaintiff, it was their duty to advise him of such fact and to account to him for the excess; that, if they concealed from him the fact that they were receiving for the property more than the listed price, and failed to so advise him, they should return a verdict for the appellant for such sum over and above the sum of $1,500 and in addition the sum of $150 which the appellant paid for his commission; that they forfeited the sum of $150 by reason of the fraudulent concealment of the true facts. The court refused to give the appellant’s prayer for instruction.

The court instructed the jury as follows: “He (appellant) testified that he got exactly what he was to get under the contract, which was $150 and the mortgage as-sinned by tbe buyer, and he was released from it, and the undisputed evidence shows that he (appellant) got the $150 and the mortgage released or assumed by the other party, so you will return a verdict for the defendant.” The jury returned a verdict as directed. The court entered a judgment in favor of the appellees, dismissing appellant’s complaint and for costs, from which judgment is this appeal.

The court erred in directing the jury to return a verdict in favor of the appellee. Under, the testimony in the record it was an issue of fact for the jury as to whether or not the appellant had agreed, to allow the appellees as their commission for making the sale of the land all they might receive over the listed sale price of $1,500. There was a sharp conflict on the issue, and the same should have been submitted to the jury, under proper instructions.

The law applicable to this branch of the. case is an nounced in Bennett v. Thompson, .126 Ark. 61. (quoting syllabus): “The duty rests upon a broker, the same as upon any other agent, to make disclosures to his principal of the terms of the negotiation so that the principal may act advisedly in determining whether or not the proposal is satisfactory. A broker may make a contract whereby he will be entitled to the difference between the price the seller agrees to accept and the amount the purchaser agrees to pay, regardless of what that amount is, but such a contract must be plainly expressed in order to relieve the broker of the duty he owes to his principal to make full disclosure concerning the terms of the negotiation.”

On the issue as to whether or not the appellant is entitled .to recover from the appellees the sum of $150 which they had received as commission for making the sale, it suffices to say that the appellant conceded that the appellees were entitled to this amount for making the sale, if there was no fraud perpetrated by appellees on appellant. There was no testimony tending to prove that the appellees had perpetrated any fraud upon the appellant in making tlie sale. The appellees sold the property for more than $1,500, and if they perpetrated a fraud at all upon the appellant it was in concealing’ from him the amount they had received in excess of the listed price and in retaining the same. The issue as to whether the appellant was entitled to recover the excess over $1,500, as we have stated, should have been submitted to the jury, under correct instructions. The issue as to whether or not appellees forfeited the $150 commission received by them, by reason of fraud perpetrated on the appellant, was one of fact also, which should have been submitted to the jury, under correct instructions.

The law is well settled that “it is the duty of one acting for another in the sale of real estate, whether for compensation or otherwise, to faithfully and truthfully make known to his principal all matters pertaining to the transaction; and if he violates this duty and fraudulently misrepresents the facts concerning his transactions, and undertakes to derive an advantage therefrom to himself, he forfeits any compensation that would otherwise be due him, and all gain made thereby belongs to his principal.” Jeffries v. Robbins, 71 Pa. 852, and other cases cited in brief of learned counsel for appellant.

The prayer of appellant for instruction on the issue as to whether the appellees were entitled to hold the $150 commission was, in effect, a peremptory one, telling the jury that the appellees were guilty of fraudulent concealment, and that they thereby 'had forfeited the $150. The court did not err in refusing this prayer.

For the error indicated the judgment is reversed, and the cause remanded for a new trial.


source: Caselaw Access Project

author: Wood, J.

license: Public Domain

text:
    DeQueen Light & Power Company v. Curtis.
    Opinion delivered February 19, 1923.
    Electricity — authority op railroad commission. — Acts 1919, No. 571, § 13, empowering the Corporation Commission to grant public service corporations a certificate of convenience and necessity, being repealed by Acts 1921, No. 124, § 25, and the latter act conferring jurisdiction on municipalities to regulate public service corporations operating within their limits, the Railroad Commission had no authority to grant a certificate of convenience and necessity to a company distributing electricity in a city under franchise from it.
    Appeal from Pulaski Circuit Court, Second Division; W. B. Brooks, Judge;
    affirmed.

      Abe Collins and Lake & Lake, for appellant.
    1. The right of the Legislature to pass the repealing act No. 124 of 1921 falls within the powers reserved to the General Assembly by sections 6 and 11, art. XII, Constitution of 1874. 153 Wis. 592, 142 N. W. 491, L. R. A. (N. S.) 1915-F, 744; 25 U. S., Law. ed., 185; 146 U. S. 258; 36 IT. S. Law. ed. 963; 25 L. ed. 185; 58 Ark. 407; 64 Ark. 83-87; 13 Fed. 754; 69 Ark. 521, 527; 82 Ark. 309, 318.
    2. The alleged contract relied upon by appellee would amount to a surrender of the police power of the State, and as such is not binding on the State. Pocahontas v. Central Power & Light Co., 152 Ark. 276; 153 Wis. 592; L. R. A. (N. S.) 1915-F, 751; 25 L. ed., 1079; 24 L. ed. 1036; 42 L. ed. 948; 19 R. C. L. 12; 28 L. ed. 585.
    3. If, since the passage of act 124, supra, appellant was required to have a certificate of convenience and necessity, either the Arkansas Railroad Commission or the city council had the right to grant it, i=since the jurisdiction of the Corporation Commission was divided by the repealing act between the two. We do not believe such certificate is necessary, but as a matter of precaution have applied to both. As supporting the jurisdiction of the city council in the matter, see §§ 5, 17 and 25 of tlie act. If there is any power in the Railroad Commission to grant it, it must come from section 1 of the repealing act.
    4. Appellee succeeded to no exclusive rights through the alleged contract with the State. 200 U. S. 22, 34; 50 L. ed. 353, 359; 201 TJ. S. 400, 471, 50 L. ed. 801, 830; 246 TJ. S. 396, 412; 62 L. ed. 793, 801; 12 R. C. L. 194; Governor’s Message to Legislature, 1921, p. 16; 25 R. C. L.1037.

      Pryor & Miles, for appellees.
    1. It is clear that the Railroad Commission exceeded its authority in granting- a certificate of convenience and necessity. By section 25 of tlie act No. 124, Acts 1921, section 13 of the act No. 574, Acts 1919, creating the Corporation, and defining its powers and duties, was repealed, and therefore, when this petition was filed, there was no law in existence conferring authority upon the Railroad Commission to grant such a certificate. This is the only question presented here for decision, and the other questions discussed by appellant are moot. However,
    2. The Legislature had no right to pass act 124 of 1921, in so far as the rights of the appellees are concerned, if thereby “injustice shall be done to the corporators.” Sec. 6 (concluding clause), art. XII, Const. 1874. Appellee, in good faith, and acting in accordance with the provisions of the act of 1919, surrendered its franchise in exchange for an indeterminate permit. It cannot be deprived of the right to operate under that permit by virtue of any certificate of necessity and convenience issued either by the Railroad Commission or by the city council of DeQueen without its day in court. This indeterminate permit amounted to a contract between the State and appellee. 153 Wis. 592, concurring opinion of Judge Timlin and cases cited; 135 N. W. 131. See also 224 TJ. S. 649 ; 233 TJ. S. 195; 111 N. Y.. 1; 230 H. S. 58; Id. 101; 66 Mich. 606.

      3. Tbe indeterminate permit having been acquired by contract, it cannot be taken away or destroyed without impairing the obligation of the contract. 4 Wheat. 517; 3 Wall. 51; 95 U. S. 104; 115 U. S. 650; Id. 683; 172 IT. S. 1; 3 Mich. 330; 113 Fed. 930; 201 U. S. 559; 67 Mich. 539; 62 Wis. 32; 227 IT. S. 544; 43 Mich. 140; 111 Mich. 498; 73 Mich. 318 ; 6 Crunch, 87; 125 Mich. 673; 124 Mich. 449; 119 Mich. 655. Under the reserve"power to amend, alter or repeal acts of incorporation, the Legislature may make any alteration or amendment of a charter which will not defeat or 'substantially impair the object of the grant or any rights vested under it. 15 Wall. 500; 107 U. S. 468; 151 U. -S. 556; 13 Cray (Mass.) 239; 160 U. S. 1; 15 Wall. 454. The- power of alteration and amendment is not without limit. Alterations must be reason-able, in good faith, and consistent with the .scope and object of the corporation. 95 U. S. 319. See also 9! U. S. 710; 160 U. S. 1; 139 Fed. 661: 193 IT. S. 207; 175 Fed. 365. The franchise rights of a public utility have uniformly been recognized by this court, beginning with 5 Ark. 599. See also 239 S. W. (Ark.) 3; 141 Ark. 18, 216 S. W. 38.
    4. The city council of the city' of DeQueen had no jurisdiction to grant appellant a certificate of necessity and convenience. The power conferred-on the Corporation Commission to grant such a certificate was expressly repealed by the act of 1921.
   Wood, J.

DeQueen Light & Power Company, hereafter called appellant, is a domestic corporation under a charter issued to it by the State on the 16th day of May, 1921. On the 13th day of June, 1921, it was granted a franchise by the city of DeQueen, Arkansas, authorizing it to sell and distribute electric current in that city. Commonwealth Public. Service Company, hereafter called the appellee, is a foreign corporation authorized to do business in this State. It had a franchise authorizing it to distribute and sell electric current, power and water to the inhabitants of the city of DeQueen as early as the year 1918. W. L. Curtis was appointed receiver for the appellee on May 25, 1920. He surrendered the franchise which appellee held authorizing it to do business in the city of DeQueen, and on January 22,1921, applied for and was granted by the Arkansas Corporation Commission “an indeterminate permit” authorizing it to continue the public utilities mentioned above to the inhabitants of the city of DeQueen. On March 14, 1922, the appellant filed its petition before the Arkansas Railroad Commission setting up its franchise above mentioned, authorizing it to distribute electric current in the city of DeQueen, and that it was efficiently performing such service, and that the appellee, for various reasons stated in the petition, was not rendering the service it should to the inhabitants of the city of DeQueen, and that appellant was chartered and received its franchise from the city of DeQueen for the purpose of remedying the condition caused by the failure of the appellee to render proper service. •

The appellant alleged in its petition that the “pub-lie convenience and necessity of the city and the inhabitants thereof imperatively requires that a certificate of convenience and necessity be issued to the petitioner,” and the petition concluded with a prayer that such certificate be issued to it. . .

The appellee, through its receiver, appeared specially, and filed its demurrer and motion to dismiss. Among other things it alleged “that the Arkansas Railroad Commission has no jurisdiction over either the person or property sought to be affected by such petition.” The Railroad Commission overruled appellee’s demurrer and motion to dismiss, and issued the certificate to appellant. The appellee appealed to the Pulaski Circuit Court, where the appellee’s demurrer and motion to dismiss the .petition of appellant was sustained, and a judgment rendered dismissing the petition. From that judgment is this appeal.

The only question for determination on this appeal is whether or not the Railroad Commission had jurisdiction to issue a “certificate of convenience and necessity” to appellant.

Section 13 of act 571 of the Acts of 1919, creating the Arkansas Corporation Commission and defining its powers and duties, vested such Commission with the power to grant to public service corporations, upon certain conditions therein specified, a certificate authorizing such 'corporations to furnish public utilities. The section concludes as follows: “Every license, permit, contract or franchise hereafter granted to any public service corporation by the State or any municipality, and all future contracts, ordinances, rules, regulations and orders entered into or made by any municipality relating to the use or enjoyment of rights and franchise granted to any public utility, shall be subject to the exercise, by the Corporation Commission, • of any and all of the powers of regulation provided for in this act.”

Section 31 of the act abolished the Railroad Commission then existing and conferred all the powers and duties of that Commission upon the Corporation Commission.

The General Assembly of 1921 passed act 124 entitled “An act to amend act No. 571 of the General Acts of the General Assembly of the State of Arkansas for •the year 1919, entitled ‘An act to create the Arkansas Corporation Commission and to define its powers and duties,’ approved April 1, 1919, and to regulate public utilities and public service corporations, and for other purposes.” This act was approved February 15, 1921.

Section 5 of Act 124, supra, provides: ‘ ‘ The jurisdiction of the Arkansas Railroad Commission created by the act shall extend to and include all matters pertaining to the regulation and operation of all common carriers” (naming them), and among other public utility corporations mentioned are “pipe-line companies for transportation of oil, gas and water, electric lighting companies and other companies furnishing gas or electricity for light, heat or power purposes,” and. hydro-electric companies and water companies, and provides that “nothing in the act shall vest the Commission with jurisdiction as to any rate, charge, rule, regulation, order, hearing, investigation, or other matter pertaining to the operation within the limits of any municipality of any street railroad, telephone company, gas company, pipe-line company for transportation of oil, gas or water, electrical company, water company, hydro-electric 'company or other company operating a public utility or furnishing public service as to which jurisdiction may be elsewhere conferred in this act upon any municipality, council or city commission; notwithstanding, 'however, the jurisdiction of the municipality as to the above matters within the limits of such municipality, the said Arkansas Railroad Commission shall have and is hereby delegated the authority and duty to require all utility companies now furnishing public service within the limits of any municipality to furnish and continue furnishing such service to such municipality, though the right of regulation of such utility as to rates and all other matters within such municipality is herein elsewhere conferred upon the municipal councils or city commissions, subject to right of appeal to the courts.” •

Section 15 of the act gives all public utility corporations now operating under indeterminate permits' granted by the Arkansas Corporation Commission ninety days after the passage of the act to make application in writing to the municipal council or city commission of the municipality which granted the original franchise, contract or lease, for reinstatements of said franchise, contract or lease, and when such application is made and filed with the clerk or recorder of said municipality it shall be granted as a matter of right, and reinstated by the municipal council or city commission having’ jurisdiction, under the same conditions as existed at the time said indeterminate permit was granted by the Arkansas Corporation Commission, and unless the application for reinstatement is made within said time it shall be a waiver on the paid of the public service corporation to insist upon the fulfillment of said franchise or contract rights.

Section 17 provides, in part, as follows: ‘‘The jurisdiction of the municipal council or city commission of any municipality shall extend to and include all matters pertaining to the regulation and operation within the limits of any such municipality of any street railroad, telephone company, gas company furnishing gas for domestic or industrial purposes, pipe-line company for transportation, distribution or sale of oil, gas or water, electrical company, water company, hydro-electric company, or other company operating a public utility or furnishing public service within such municipality.”

Section 25 of the act is as follows: “That sections 13, 14, 15, 20, 26, 29, 31 and 35 of act No. 571 of the General Acts of the General Assembly of the State of Arkansas for the year 1919, approved April 1,1919, hereinbefore referred to, be and the same are hereby repealed.”

It will be observed that section 13 of act 571 of the Acts of 1919 which conferred jurisdiction upon the Corporation Commission to grant public service corporations a certificate of “convenience and necessity” is expressly repealed by act 124 of the Acts of 1921, and the latter act, as shown by the various provisions above quoted, as well as other provisions which it is unnecessary to set out, confers upon municipalities exclusive jurisdiction over public utilities, like the appellant, operating within their limits.

In Pocahontas v. Central Light & Power Co., 152 Ark. 276, speaking of the jurisdiction of the Railroad Commission under the Acts of 1921, we said: “The public service corporations over which the jurisdiction of the Commission shall extend is specifically stated in § 5 of the act, and jurisdiction by municipalities to regulate public service corporations or public utilities operating lo-ithin the limits of such municipalities is conferred by sec. 17 of the act.”

It follows that at the time of the filing of the petition of the appellant on the 31st of March, 1922, asking the Railroad Commission to grant it a certificate of “convenience and necessity,” the Commission had no jurisdiction to grant such certificate. Having reached this conclusion, the other interesting questions presented and elaborately' argued in the briefs of learned counsel pro and con pass out, and we therefore pretermit a discussion and decision of these questions.

The judgment of the circuit court is correct, and it is therefore affirmed.


author: Hart, J.,

text:
    Arkansas Land & Lumber Company v. Cook.
    Opinion delivered February 19, 1923.
    1. Master and servant — authority op foreman. — A member of a section crew, occupying- his regular place on a motor car while riding home from work, is as much under authority of the foreman of the crew as when actually at work on the tracks.
    2. Master and servant — instruction as to liability for injury to servant on motor car. — In an action by a section man for injuries received while returning from work on a motor car, where the evidence showed that he was a member of a crew which worked under a foreman, an instruction authorizing- recovery if the jury found that plaintiff was in defendant’s employ, and was working under its foreman’s orders, and was-injured on account of defendant’s negligence,-was not objectionable on the ground that there was no evidence that he was working under the orders of the foreman, or was injured by reason of obeying any order of his foreman.
    3. Trial — instruction—assuming negligence of master. — In an action by a section man for injuries received while returning from work on the defendant company’s motor-car, an instruction that if the evidence showed that he was injured on account of the company’s negligence the jury should find for him did not assume that defendant was negligent.

      4. Master and servant — duty to furnish safe place — In an action by a section man for injuries received while returning from work on a motor-car which jumped the track, where there was evidence that the ties were rotten, that the rails had spread because spikes had come out of them, and that there were low joints, an instruction that it was the duty of defendant to exercise ordinary care to see that its motor car and tracks were kept in a reasonably safe condition, and that this duty required defendant to make reasonable inspection, was not objectionable on the ground that there was no evidence of failure to make an inspection, and that the plaintiff knew of the condition, as it was not his duty to make inspection.
    5. DAMAGES' — instruction as to permanent injury. — Where there was medical testimony tending to prove that plaintiff’s injuries were permanent, an instruction to assess such damages as would compensate plaintiff for loss from diminished earning capacity was not erroneous.
    6. Evidence — expert opinion. — A medical witness may testify as to the probable effects of an injury or other conditions observed by him in his examination and treatment of a patient.
    7. Release — instruction.—In a personal injury action, where the evidence as to whether plaintiff signed a release was conflicting, an instruction that if plaintiff did not sign the release nor authorize another to sign it for him, it would be no defense, was not erroneous.
    8. Master and servant — ne&ligence concurring with act of GOD — In an action by a section hand for injuries received when a motor-car on which he was riding jumped the track, which was covered with sleet, an instruction that no one can recover for injuries caused by the act of God alone, but that if the act of God, coupled with the act of man, causes injury, a recovery is not barred by the act of God, was not error.
    9. Damages — when not excessive. — Where a section man, injured when defendant’s motor-car jumped the track, was permanently injured in his hip and had a limp in his walk, could not lift heavy loads, and his spermatic cord was enlarged and became hardened, a verdict of $1,000 damages was 'not excessive.
    10. Master and servant — negligence—sufficiency of evidence.— Evidence held to sustain a finding that the defendant was guilty of negligence causing plaintiff’s injuries.
    Appeal from Calhoun Circuit Court; G. W. Smith, Judge;
    affirmed.

      STATEMENT OF FACTS.
    Granville Cook sued the Arkansas Land & Lumber Company to recover damages for physical injuries received by him by ’being negligently thrown from the front end of a motor-car on which he was riding while in the employment of said company. The defendant denied that the plaintiff was injured on account of its negligence.
    On the 12th day of January, 1921, Granville Cook was injured by being thrown from a motor-car of the Arkansas Land & Lumber Company while returning from work. The defendant owns and operates a railroad from its mill to a point something like twenty-five or thirty miles in the country. The company used a motor-ear with a trailer attached to it to carry its section crew and bridge crew to and from their work. Each crew-worked under the direction of a foreman, and both together had fourteen men. The section crew rode on the motor-car, and the bridge crew on the trailer attached to it. The section foreman usually drove the motor-car with the trailer attached, but on the day in question the car was driven by the assistant section foreman.- It had been sleeting on that day, and this made the track slick. The entire crew of fourteen men started to the mill on the motor-car and trailer. Granville Cook was riding on the right-hand corner of the motor-car, which was his usual and customary place to ride. As the car approached a sharp curve, the driver cut off the gas in order to check the speed of the car. Then he turned the gas on again, and the car ran off of the track on the inside of the curve. Its speed was about twenty-five miles an hour when it left the rails, and the car then ran along on the ties until it fell over. The plaintiff was pinned under the car and was severely injured. There was a low joint where the car ran off the rails. The surface under the rails and ties had become soft, and the heavy loads drawn over the rails had caused them to sink down into the earth. The ties had become rotten to an extent, and this caused the spikes which fastened the rails to the ties to become loose and let the rails spread. The railroad was used.for hauling the logs of the defendant. The customary speed at which the motor-car was run in carrying the crew, to and from work was twelve miles an hour. Some of the crew testified that there was no slacking of the speed of the car when the car ran into the curve, and that it was going at the rate of twenty-five miles an hour.
    According to the evidence for the defendant, the track was in good condition and the ties were sound. There were no low joints in the rails, and the rails had • not spread. The motor-car had been inspected four or five days before the accident, and was in good condition. It had been in use about six months. The front axle of the car was not bent, as testified to by some of the plaintiff’s witnesses.
    The assistant section foreman, who was driving the car at the time of the accident, was also a witness for the defendant. According to his testimony, the track was covered with sleet, and was very slick. When he got to the point of the curve he threw the gas off, and when he thought he was safe he threw the gas back on to hold his speed. When lie put the gas on the car again, it jumped the track. He testified that the sleet was hitting him in the face when he turned the gas on. He said that he turned the gas on in the ordinary and usual way, but because of the sleet hitting him in the face he might have put on too much gas.
    Other evidence will be stated or referred to -in the opinion.
    The jury returned a verdict in favor of the plaintiff for $1,000, and the defendant has appealed.

      Henry Berger and Mehaffy, Donham & Mehaffy, for appellant.

      D. D. Glover and D. M. Halbert, for appellee.
   Hart, J.,

(after stating the facts). The first assignment of error is that the judgment should be reversed because the court gave instruction No. 1, over the objection of the defendant. The instruction is as follows:

“The court instructs the jury that, if you find from a preponderance of the evidence in this case that the plaintiff was in the employ of the defendant company and was working for it under the orders and directions of its foreman, and you find from the evidence that he was in the exercise of ordinary care for his own protection, and you find from the evidence that he had not assumed the risk, and you find from the evidence that he was injured on account of the negligence of the defendant company, its agents, servants or employees, as alleged in his complaint, it will be your duty and you are instructed to find for the plaintiff in this case. ’ ’

Counsel specifically objected to the instruction because there was no evidence-to the effect that the plaintiff was working under the orders and directions of his foreman, or that he was injured by reason of obeying any order or direction of his foreman.

We do not think this objection is tenable. The evidence shows that the plaintiff was a member of a section crew which worked under a foreman. He necessarily gave them orders about doing their work, and the instruction simply means that, at the time the plaintiff was injured, he was working under his foreman. It was true he was coming home from his work on a motor-car, but this was his usual and customary way of going to and from work. He had a regular place on the motor-car in which to sit, and he was occupying this place at the time the car ran off of the track. He was as much under the authority of the foreman at this time as he was when he was actually at work on the tracks. Arkadelphia Lumber Co. v. Smith, 78 Ark. 509; Gilkey v. La. & Ark. Ry. Co., 103 Ark. 231. The instruction did not mean to submit to the jury that the plaintiff was injured k while doing a particular act at the command of his foreman. This interpretation is negatived by all tlie testimony in the case. There is no dispute whatever about how the accident occurred. The only dispute is about the defective condition of the track and the negligence of the driver of the motor-car. We do not think that the jury could have been in anywise misled by this instruction.

The court gave, at the request of the defendant, instructions covering every phase of the case presented 'by the evidence.

Again, it is insisted that the instruction assumes that the defendant was negligent. We do not think so. The instruction plainly predicates the right of the plaintiff to recover upon a finding by the jury of negligence as alleged in the complaint.

It is next insisted that the court erred in giving instruction No. 7, which reads as follows:

“You are instructed that it was the duty of the defendant company to exercise ordinary care to see that its motor-car and its track and roadbed were kept in a reasonably safe condition, and you are further instructed that this duty that rested on the defendant company required it to make reasonable inspection to see that they were kept in a reasonably safe condition.”

It is first contended that there is no evidence to the effect that the defendant failed to make an inspection, and that the plaintiff knew as much about the condition of the track and roadbed as any one. The evidence for the plaintiff to the effect that the ties were rotten and that the rails had spread because the spikes had come out of them was evidence tending to show that the defendant had not inspected its tracks. Then, too, there was evidence of low joints in the rails which was caused by heavy loads being hauled over the rails and pressing them down into the ground, without a proper surfacing of the tracks. This evidence was sufficient to constitute negligence on the-part of the defendant ; for it was its duty to exercise ordinary care in furnishing the plaintiff a safe place in which to work. It is true that the plaintiff was a section hand, and rode over the rails every day, but this did not make it his duty to inspect the rails and the roadbed for defects in them. Therefore we hold this assignment of error is not well taken.

The nest assignment of error is that the court erred in giving instruction No. 8, which reads.as follows:

“The court instructs the jury that, if you find for the plaintiff, from the evidence in this case, you will assess his damages at such a sum as will compensate him for the injuries sustained, if any; the physical pain and mental anguish suffered and endured 'by him in the past, if any, by reason of the said injuries; his loss of time, if any; and his pecuniary loss from diminished -capacity for earning money, if any; and from these, as proven by the evidence, assess .such damages as will fairly compensate him for the injuries received.”

Counsel for appellant claim that there is not sufficient evidence in the record upon which to predicate an instruction for damages for permanent injuries, and rely upon the case of St. L. I. M. & S. Ry. Co. v. Bird, 106 Ark. 177, to support this view.

• We do not think that the facts in the two cases are similar. In that case one of the physicians, in testifying whether or not the injury was permanent, said that there was a probability that it was permanent, and that it was just about equally balanced in his mind whether or not the injury was permanent. Another physician testified that it was questionable whether the injured person would ever get well, and that, looking at his condition as a matter of probability, it was .discouraging to him as a physician. The court held the testimony to be insufficient, and said that, unless the testimony tended to -show with reasonable certainty that the injury was permanent, the -court should not permit the jury to assess any damages for permanent injuries.

Here there is something more than the balancing of probabilities by the physician. Dr. Williams was a graduate physician and surgeon, and had been practicing his profession for over forty years. He testified that he had examined the plaintiff several times, and' described minutely the result of his several examinations. Then, in response to a direct question, he testified that the plaintiff had a permanent injury of the hip and possibly of the soft part of the pelvis. Dr. Williams gave this as his positive opinion, based upon his personal examination of the plaintiff upon several different occasions, and, as above stated, described with particularity the result of his examination.

But it is contended that Dr. Williams should not have been allowed to give his opinion of the permanency of the plaintiff’s injuries. We cannot agree with counsel in this contention. A medical witness may be permitted to state the probable effects ’of an injury or other conditions observed by him in his examination and treatment of a patient. Mo. & N. Ark. Rd. Co. v. Collins, 106 Ark. 353; K. C. So. Ry. Co. v. Cobb, 118 Ark. 569; and Hines v. Patterson, 146 Ark. 367.

It is next insisted that the court erred in giving instruction No. 9, which is as follows:

“You are instructed that, if you find from the evidence in this case that the plaintiff did not sign the release pleaded in this case, or authorize any one else to sign it for him, or cash it, it would be no defense in this case.”

It is claimed that there is no evidence upon which to base this instruction. It is true that the evidence for the defendant tended to show that it settled with the plaintiff, and that he signed a release of all claims against the defendant with full knowledge of its purport. It was also shown by the defendant that the draft which was issued to G. C. Cook for $4.50 in settlement hf his claim was cashed by the Bank of Malvern and paid by the drawee in due course of business.

It cannot be said, however, that this testimony is undisputed. The plaintiff denied in positive terms that he signed the release, cashed the draft, or made. any settlement whatever with the company. He testified further that he had never heard of any settlement until the day before he testified. This was testimony of a substantive character tending to contradict the evidence of the defendant on this point, and warranted the court in giving the instruction now complained of. The credibility of the witnesses was for the jury, and we hold that this assignment of error is not well taken.

It is also insisted that the court erred in giving instruction No. 6, which reads as follows:

“You are instructed that no one can recover damages for injuries caused by the act of God alone, but you are further instructed that if the act of God, coupled with the negligence of man, causes injury or damage to persons or property, a recovery is not barred by the act of God.”

This court has held that, if the damage is caused by the concurring force of the defendant’s negligence and some other cause for which he is not responsible, including the act of God, the defendant is responsible if his negligence is one of the proximate causes of the damage. St. L. S. W. Ry. Co. v. Mackey, 95 Ark. 297, and St. L. I. M. & S. Ry. Co. v. Steel, 129 Ark. 520.

It is contended, however, by counsel for the defendant that the instruction is erroneous because it made the defendant responsible if the jury should find that its negligence, concurring with the act of God only in a remote degree, caused the injury. We do not think so. As stated in the above opinion, the act of God which excuses must be not only the proximate cause, but the sole cause. We think, under the language of the instruction, the concurring negligence of the defendant, with the act of God,as an efficient and co-operating cause, was submitted to the jury under the principles of law above announced.

It is next insisted that the verdict of $1,000 is excessive. According to the evidence of the plaintiff, he was permanently injured in his hip, and had a limp in his walk at the time of the trial. He cannot lift heavy loads, and his spermatic cord has been enlarged and become hardened as a result of his injury.

It is true that, according to the evidence for the defendant, he is not permanently injured, but the jury has settled the conflict between the witnesses on this point in favor of the plaintiff. Assuming the evidence for the plaintiff, on the character and extent of his injuries, to be true, it cannot be said that the verdict is excessive.

According to the evidence for the plaintiff, he was going home from work in a motor-car of the defendant, and was «till in its service. Arkadelphia Lbr. Co. v. Smith, 78 Ark. 505, and Gilkey v. La. & Ark. Ry. Co., 103 Ark. 231. Hence it was the duty of the defendant to exercise ordinary care for the safety of the plaintiff while carrying him to and from his work, and it was also its duty to make reasonable inspection to see that the motorcar and track were in safe condition.

Bearing this in mind, it is readily apparent that, under the evidence adduced for the plaintiff, the jury was warranted in finding the defendant guilty of negligence in one or both of these respects, as alleged in the complaint.

It follows that the judgment must be affirmed.


text:
    Harmon v. Winegar.
    Opinion delivered February 19, 1923.
    1. Husband and wipe — liability op wipe’s property por husband’s debts. — The creditor of an insolvent husband, seeking to have his wife’s property subjected to payment of his debts, must prove that he gave credit to the husband upon the faith of, and in the reasonable and justifiable belief in, the fact that the husband was the actual owner of the property in controversy, and without notice of any facts and circumstances that would lead to the belief that such property was claimed by the wife.

      2. Husband and wife — wife’s separate property. — Where the wife of an insolvent debtor with her own means purchased and after-wards foreclosed a mortgage on a farm and bought in the property, intending to sell the property to her husband, held, in the absence of proof that the husband had possession or that she permitted him to use it as a source of credit, the land is not subject to his debts.
    3. Husband and wife — wife’s separate property. — An automobile given to an insolvent debtor’s wife in appreciation of medical services rendered to a patient by the debtor is not subject to his debts, in the absence of proof that it was intended as payment for such services, or that it was used by the debtor as the basis of credit.
    4. Husband and wife — wife’s separate property. — Where the furniture of an insolvent doctor’s office was the property of his . wife, it is not subject to payment of his indebtedness where the debt was not contracted on the faith of his ownership of the furniture.
    Appeal from Garland Chancery Court; J. P. Henderson, Chancellor;
    affirmed.
    STATEMENT OF FACTS.
    Bertha Harmon first brought this suit in the circuit court against E. P. Winegar to recover the amount due her on two promissory notes, dated respectively Nov. 2, 1916, and Peb. 20, 1917, and also for $100 in cash furnished the defendant by the plaintiff in October, 1918. The first note was for $1,203.77 and the second for $300, and each was due one year after date.
    Subsequently the complaint was amended by making Melissa Winegar, the wife of E. P. Winegar, a party to the suit. It was alleged that E. F. Winegar was the owner of 'certain real property, the title to which was taken in his wife’s name for the purpose of defrauding his creditors in the collection of their debts against him. It was also alleged that the title to certain office furniture used by the defendant, E. F. Winegar, in his office was taken in his wife’s name for the purpose of defrauding his creditors. The same allegation was made concerning an automobile.
    Mrs. Melissa Winegar denied the allegations of the amended complaint, and moved to transfer the cause to equity. The plaintiff agreed to the motion, and the cause was transferred and tried in the chancery court.
    C. D. Harmon, a young man twenty-seven years of age, and the son of the plaintiff, Bertha Harmon, was the principal witness for her. According to his testimony, the notes sued on were made payable to himself, and indorsed by him to his mother. The notes were given to secure money borrowed by E. F. Winegar from Bertha Harmon. The witness had no interest in the matter, and simply negotiated the loan for his mother. The witness always cared for his mother’s business. He liad known Dr. Winegar for fourteen years, and after he became a man he began to work for Dr. Winegar. Dr. Winegar and his associate, a Mr. Onffroy, contemplated building a sanitarium near the city of Hot Springs, Ark., which should cost $10,000,000, and they devoted several years to the promotion of the enterprise. Dr. Winegar at different times, while G. D. Harmon was in his employment, told the latter that all of his property was in his wife’s name. It does not appear whether he told Harmon this before or after the money was loaned to Dr. Winegar. After spending a good deal of time and money in promoting the $10,000,000 sanitarium, the enterprise failed, and it turned out that Onffroy and Dr. ’Winegar were insolvent. The witness also testified that subsequently an effort was made to get Mrs. Wine-gar to sign the notes, but that she refused to do so.
    Mrs. Melissa Winegar was a witness for herself. According to her testimony, her father during his lifetime first gave her money with which to buy a home in Hot Springs, and she did so. Subsequently her father gave her $10,000 with which to improve her home, and she let her husband have that to promote his $10,000,000 sanitarium. After her father’s death she received $40,000 as her part of his estate. She let her husband have all of this amount to promote his $10,000,000 sanitarium., and the understanding between them was that, if the enterprise was a success, he would pay her back, and, if not, she realized that he would be unable to.repay her. During the course of the promotion of the sanitarium a tract of land known as the Barry farm near Hot Springs was selected as a probable site on which to locate the sanitarium. There were three mortgages on the farm, which were purchased by Mrs.' Winegar for the sum of $4,000. She mortgaged her home to secure the money with which to purchase these mortgages. Subsequently she brought suit to foreclose the mortgages so assigned to her, and the principal and interest at that time amounted to $7,500. A decree of foreclosure was duly entered of record in the chancery court, and at the foreclosure sale Mrs. Winegar became the purchaser of the land. She acquired title to the automobile in this way: Her husband had treated a wealthy oil man and other members of his family as a physician and surgeon. The oil man was so pleased with his services that he purchased the automobile and gave it to Mrs. Winegar in 1919. It was the intention of the two families to take a trip out West in the car. The oil man gave her the car because she could drive one and her husband could not.
    Mrs. Winegar gave her testimony by a deposition in September, 1921. According to her testimony, she purchased the office furniture in 1913 and paid something like $1,900 for it. She exhibited the receipted bill for it. She said that her husband ran a small sanitarium in connection with his office as a physician and surgeon in Hot Springs, Ark., and that she purchased this furniture for his use there, and it was understood that she was to be paid by receiving the rent from the rooms which he used as a sanitarium. She acquired the money from her father with which to purchase- the furniture.
    It. was decreed by the chancery court that the plaintiff should have judgment against E. F. Winegar for the amount sued for, and it was further decreed that the complaint as to the defendant, Melissa Winegar, should be dismissed for want of equity. The plaintiff has appealed.

      A. J. Murphy, for appellant.

      R. G. Davies, for appellee.
   Hart, J.,

(after stating the facts). To reverse the decree the plaintiff relies upon the case of Maloney v. Hale, 153 Ark. 162. In that case the court held that, where a wife permitted her husband to use her money and personal property as an apparent basis of credit, she is estopped from claiming the property as against one who extended credit to her husband on the faith thereof. In that case the husband failed in business, and about a year afterwards he again engaged in business in the name of Hale & Co. The wife claimed the business, and said that she obtained the money with which to start it from her brother-in-law. The business was conducted solely by the husband under the name of Hale & Co. for many years. The wife never gave any attention whatever to the business. The husband obtained credit on the faith of its being his own business. The money of the wife and the business skill and industry of the husband could not be separated. There was no question but that the creditors extended credit to the husband on the faith that it was Ms own business. He had no other basis of credit. Hence the court held that, the plaintiff having given the husband credit on the faith of Ms supposed ownership of the business, it would be a fraud on him for the wife to be allowed to claim the business. In cases of this sort, however, it is essential, in order that the plaintiff may invoke this estoppel against the. wife, that he should have given credit to the husband upon the faith of, and in the reasonable and justifiable belief in, the fact that the husband was the actual owner of the property in controversy, and without notice of any facts and circumstances that would lead to the belief that the property was claimed by the wife.

In the present case the wife mortgaged her homestead to secure the money with which she purchased the mortgages on the Barry farm. It is true that she did this with the view of selling'the farm to the corporation promoted by her husband for use in erecting a large sanitarium. The motive which prompted, her to make the purchase, however, cuts no figure in' the case. The fact remains that she did purchase the mortgages with her own money. It is also insisted that she purchased the mortgages for less than their face value. This did not make any difference. That was a matter which solely concerned the mortgagees. The validity of their mortgages is not even questioned by the plaintiff. Mrs. Winegar had a right to foreclose the mortgages after they were assigned to her and to purchase the mortgaged land at the foreclosure sale. It is not shown that the husband had possession of the land or that his wife permitted him to use it as a source of credit.

The evidence also shows that the automobile -was given her by a wealthy oil man in token of his appreciation of professional services rendered him and members of his family by Dr. Winegar. It is not shown that the automobile was given as a part payment for these medical services. The evidence shows that it was a gift, pure and simple, to the wife, and we.are not concerned with the motive which prompted the gift, in the absence of a showing that it was intended as a payment, in whole or in part, for the medical services performed upon the giver by her husband. It is not shown that the husband used it as a basis of credit.

With regard to the office furniture, the case is not so plain, but we are of the opinion that the finding of the chancellor in favor of Mrs. Winegar on this point is not against the preponderance of the evidence. The evidence is plain that Mrs. Winegar bought the furniture and paid for it. She exhibited the receipted bill which she obtained from the dealer who. sold her the furniture. She testified to the amount of money that her father gave her, and the large amount inherited from him after his death. She gave the place where he died, and the records there would have shown the falsity of her testimony as to the amount that she received when her father’s estate was administered upon and distributed to his heirs. No contradiction of her testimony in this respect was made. Hence, if the plaintiff has any standing iii this case as to the furniture, it must be upon principles of equitable estoppel on the ground that Mrs. Winegar permitted her husband to take possession of it and acquire credit on the strength of it, and, the plaintiff having given him credit on the faith of his supposed ownership of it, it would be a fraud on her for Mrs. Winegar to now claim that the furniture is hers.

According to the testimony of Mrs. Winegar, she at all times claimed the furniture and collected the rent on it while it was in her husband’s possession. The chief source of her husband’s income as a physician and surgeon would necessarily arise from his professional services, and his office furniture would be merely an incident to his profession.

It does not even appear that he obtained the loan from the plaintiff on account of having this furniture. He was engaged with an associate, who also had signed the note sued on, in promoting a $10,000,000 enterprise. Both Dr. Winegar and his associate spent large sums of money and much time in promoting this enterprise. The plaintiff thought that it would be a success, and that Dr. Winegar and his associate had considerable means. It does not appear that his office furniture was ever considered in the premises at all.

In the case relied on for a reversal of the decree the wife necessarily knew that the husband was conducting the business solely on his own account, and that credit was being extended to him solely on the faith of his supposed ownership of the business. He was insolvent, and had no other source of income. His ability to earn money was inseparable from the business.

Here the office furniture was but a small incident in the business of Dr. Winegar. He claimed to be a physician and surgeon of note, and obtained credit from the plaintiff on her belief in the success of the enterprise promoled bv him and his associates.

The chancellor found that, under the peculiar circumstances of this case, no fraud was practiced upon the plaintiff, and that the doctrine of equitable estoppel did not apply. It cannot be said that his finding is against the preponderance of the evidence, and the decree will therefore be affirmed.


text:
    Lighter v. State.
    Opinion delivered February 19, 1923.
    1. Witness — wife testifying for husband. — Notwithstanding the enfranchising of women, a wife is incompetent to testify for or against her husband in a criminal case, save that she may testify against him in cases where an injury has been done by him against her person or property, as provided by Crawford & Moses’ Dig., § 3125.
    2. Criminal law — instruction as to defendant’s credibility.— An instruction in a criminal case stating the matters to be considered in determining the degree of credit to be given to defendant’s testimony held not erroneous.
    3. Criminal law — general and special instructions. — An instruction in correct form presenting defendant’s theory of the case was not covered by a general instruction given which does not cover the particular theory of the defendant.
    4. Criminal law — request for instruction.- — It was error to refuse a correct request for instruction presenting defendant’s theory of the case, which is supported by evidence and is not covered by other instructions given.
    5. Embezzlement — evidence.—Evidence, on a prosecution for embezzlement, that money was deposited with defendant to secure defendant’s wife for signing a bail bond, and that the money is still held under that agreement, held not to sustain conviction of embezzlement.
    Appeal from Sebastian Circuit Court, Fort Smith District; John Brizzolara, Judge;
    reversed.
    STATEMENT OE FACTS.
    J. D. Lighter was indicted under § 2500 of Crawford & Moses’ Digest for the crime of embezzling $140 which Nina Seals had placed in his hands as bailee.

      According to the evidence for the State, Lured Seals, the husband of Nina Seals, was convicted of a crime in the municipal court of Fort Smith, Ark., and fined $140. He took an appeal to the circuit court. The defendant, J. D. Lighter, was his attorney, and Nina Seals gave the defendant $140 as a deposit for the fine of her husband, and a receipt given by Lighter to her for the money recited that, if Lured Seals appeared at the term of the next circuit court, the money was to be refunded to Nina Seals.
    The circuit court dismissed the appeal because it was not perfected in time, and the municipal court threatened to put Lured Seals in jail for the nonpayment of his fine. The defendant procured the release of Lured Seals by promising to pay the fine. He said that his wife had just been operated on, and that she had the $140 which had been deposited with her for the purpose of procuring her to sign the bail bond of Lured Seals.
    On cross-examination, Nina Seals admitted that, when she first gave the money to the defendant, it was understood that his wife was to sign the bond, and that the money was given to secure her against loss. She also said that it was understood that the defendant would take care of it. Nina Seals knew that Mrs. Lighter was called to the jail where her husband, Lured Seals, was confined, and that Mrs. Lighter signed the bail bond of Lured Seals and thereby procured his release from jail. The defendant paid $65 of the fine against Lured Seals, and has failed and refused to pay the balance of it.
    Subsequently Nina Seals removed' from Fort Smith, Ark., to the State of Oklahoma, and in a few months procured a divorce from her husband. ' She has since remarried, and is now Nina Henson.
    J. D. Lighter was a witness for himself. According to his testimony, Nina Seals turned over to him $140 to secure his wife against loss as surety on the bail bond of Lured Seals, who was at that time the husband of Nina Seals. Subsequently the defendant delivered the $140 to Ms wife in the presence of Nina Seals and Lured Seals. His wife then signed the bail bond of Lured Seals, and he was released from jail. On the same day that the circuit court dismissed the appeal of Lured Seals, the municipal court issued a commitment for him. Nina Seals informed the defendant of this fact, and asked Mm to go over and pay the fine. The defendant told her that his wife was in the hospital, and he could not get the money from her at that time. He went with Nina Seals and told the presiding judge that his wife had just been operated on, and that he could not draw upon her account. He told the court that, just as soon as his wife was able, he would have her make a check for the money and pay it into court. The defendant told the court that he would pay the fine of Lured Seals, and in this way secure Ms release. The next day the defendant collected $65 and paid it on the fine and costs. Subsequently Nina Seals came to the defendant’s office, and told him that she had separated from her husband, and notified him not to let his wife pay the money deposited with her on the fine. The, defendant’s wife still has the money in her possession. The defendant’s evidence was in some respects corroborated.
    The jury returned a verdict of guilty, and the defendant was sentenced to one year’s imprisonment in the State Penitentiary. He has duly prosecuted an appeal to this court.

      W. A. Falconer and Webb Covington, for appellant.

      J. S. Utley, Attorney General, Elbert Godwin and W. T. Hammock, Assistants, for appellee.
   Hart, J.,

(rafter stating the facts). The first assignment of error is that the court erred in refusing to allow the defendant’s wife to testify in his behalf as to the circumstances attending the deposit of the &140 with her. The general rule is that the wife is incomuetent to testify for her husband in a criminal case. Padgett v. State, 125 Ark. 471.

In Christian & Taylor v. Fancher, 151 Ark. 102, the court held that the act of the Legislature enfranchising women has not changed the status of a married woman so as to render her competent to testify in her husband’s behalf. This rule applies to criminal as well as civil proceedings, except that, under § 3125 of Crawford & Moses"' Digest, the wife may testify against the husband in cases in which an injury has been done by him against her person or property. Therefore this assignment of error is not well, taken.

It is next insisted that the court erred in giving instruction No. 5, which reads as follows: “5. I charge you further that, under the law, the defendant is a competent witness in his own behalf, and you should take his testimony and consider it in the same manner as you do the testimony of any other witness in this case. You are not blindly to receive a fact as true simply because the defendant says it is true, but you should take his testimony and weigh it in connection with all the other evidence and circumstances in this case, and determine whether his statements are true and made in good faith, or whether they are made for the purpose of avoiding a conviction at your hands. In considering the degree of credit to be given it, you may take into consideration the defendant’s appearance on the witness stand while testifying, the reasonableness or unreasonableness of his statements, his candor or lack of candor, and his interest in the result of your verdict.”

It is the duty of the court to instruct the jury in the rules of law by which the testimony is weighed and its credibility tested. The jury are the exclusive judges of the weight of such testimony, and the court has no right, directly or indirectly, to express an opinion on the weight to be given to the testimony. While it has been said an instruction on this point may be drawn in more apt language, still it has been held that an instruction in substantially the same language is not erroneous. Hamilton v. State, 62 Ark. 543, and Whitener v. State, 120 Ark. 30.

The next assignment of error is that the court erred in refusing to give instruction No. 2 at the request of the defendant. The instruction reads as follows:

“Mr. Covington: I want to ask the court to instruct the jury that, if they find from the evidence in this case that the defendant, Lighter, acting as the agent of Nina Seals, secured the signature of his wife to the appeal bond of the husband of Nina Seals, and Nina Seals deposited with him the sum of one hundred and forty dollars to secure his wife against loss by reason of her having signed the bond, and that the one hundred and forty dollars was turned over to her, and she has it now, it would be their duty to acquit the defendant in this ease. ”

It is first claimed by the State that the matters embraced in this instruction were covered by 1-a given by the court. This instruction reads as follows:

“If you find from the evidence, beyond a reasonable doubt, that the defendant, J. D. Lighter, in the Fort Smith District of Sebastian County, Arkansas, within three years before the finding of the indictment in this case, being then and there over the age of sixteen years, and being then and there the bailee, and having then and there in his hands and possession, as such bailee of the said Nina Seals, one hundred and forty dollars in gold, silver and paper money, of the value of one hundred and forty dollars, the property of Nina Seals as aforesaid, did unlawfully, fraudulently and feloniously make away with, embezzle and convert to his own use the said one hundred and forty dollars, without the consent of the said Nina Seals — if you find these facts from the evidence, beyond a reasonable doubt, it would be your duty to convict the defendant.”

A comparison of the two instructions will show that the instruction given by the court is entirely general in its terms, and does not cover the particular theory of the defendant relied upon by him for a reversal of the judgment.

While this court has uniformly held that it is not necessary to repeat instructions where the point involved is already embraced in the instructions given, it is equally well settled that it is the duty of the court to give instructions presenting the defendant’s side of the case, if there is evidence to support it and the defendant requests a proper instruction. This rule is elementary, and in the application of it we are of the opinion that the court ¿rred in refusing to give instruction No. 2 asked by the defendant. The instruction was correct in form, and presented the defendant’s theory of the case, and should have been given.

If the testimony of the defendant was true, the money was deposited by him with his wife for the purpose of getting her to sign the bail bond of Lured Seals, and Nina Seals knew this was the object to be accomplished when she delivered the money to the defendant. If the money was delivered to the defendant’s wife for that purpose, and is still held by her under the original agreement, the defendant is not guilty of embezzlement, and had a right to have his theory of the case submitted by instruction No. 2 as requested by him.

It follows that, for the error in refusing to give instruction No. 2 asked by the defendant, the judgment must be reversed, and the cause will be remanded for a new trial.


author: Smith, J.

text:
    State v. Knights of Pythias of North America, etc.
    Opinion delivered February 19, 1923.
    1. Insurance — benefit society subject to audit when. — Under Crawford & Moses’ Dig., § 6117, as amended by Acts 1921, p. 472, relating to exemption from supervision by the insurance department of certain fraternal orders, including the Knights of Pythias, held, that both the white and the colored orders of the Knights of Pythias were intended, but that the insurance departments of such orders were expressly excluded from the exemption, and are subject to the audit of the Insurance Commissioner.
    2. Trial — sufficiency of general finding. — On an application, by the State for the .appointment of a receiver of a fraternal benefit society, where a report was made by the plaintiff for separate findings of fact and law, held a general finding of fact and refusal to grant the relief prayed for was a sufficient compliance with such report.
    3. Insurance — irregularities.—Evidence of irregularities in the conduct of the insurance department of a fraternal benefit society held insufficient to warrant the appointment of a receiver.
    4. Insurance — benefit society — appointment of receiver. — Though the State’s right to supervise fraternal and benefit societies when they engage in the insurance business is .universally upheld, the remedy of appointing a receiver is a harsh one, and will not be applied until all other remedies fail.
    Appeal from Pulaski Circuit Court, Second Division; W. B. Brooks, Judge;
    affirmed.

      J. S. Utley, Attorney General, Elbert Godwin and W. T. Hammock, Assistants, and F. G. Lindsey, for appellants.
    The court erred in refusing to state in writing its conclusions of fact found separately from the conclusions of law. C. & M. Digest, § 1309.

      T. J. Price, J. R. Booker, Scipio A. Jones, and Coleman, Robinson & House, for appellee.
    The judgment of the lower court was correct. 70 Ark. 507; 73 Ark. 418; 85 Ark. 127; 86 Ark. 140; 85 Ark. 1; 102 Ark. 435. The court was correct in its declaration of law. 105 Pac. 411. The evidence was not sufficient to revoke the corporate privileges and to appoint a receiver. No relief could be accomplished by this procedure. 42 Ohio 579; 26 Atl. 1045; 27 Atl. 712; 41 So. 228, 20 L. R. A. 210. The misconduct of managers or trustees is not ground for dissolution of a corporation and appointment of a receiver. 50 Barb. 157; 16 Cal. 145; 30 Iowa 148; 130 Mass. 194; 19 R. C. L. 1320.
   Smith, J.

Upon complaint being made to the Insurance Commissioner 'concerning the management of the Knights of Pythias of North America, South America, Europe, Asia, Africa, Australia, and the State of Arkansas, a domestic colored fraternal insurance order, that officer caused an audit of its affairs to be made. Authority for this action is conferred 'by § 6110, C. & M. Digest; indeed, without complaint being made to the Insurance Department, it is the duty of that department to make an examination of the “affairs, transactions and condition” of such organizations at least once every three years.

The accountants representing the Insurance Department made a report, in which they reported that they had not been accorded the cooperation by the order necessary to make a satisfactory audit of its affairs; and the testimony established the fact that the officers of the company did not apparently realize their duty to aid in this audit, nor did they appear to comprehend the extent of the authority of the auditors. Subordinate lodges made complaint of the management of the officers of the order, and, in addition, the grand chancellor, the chief officer of the order, preferred charges to the Insurance Commissioner which tended to show that the finances of the order were being misappropriated. A supplemental audit by the Insurance Department appeared to confirm the findings in the first report; and the Insurance Commissioner turned these reports over to the Attorney General of the State. Upon an examination of these reports the Attorney General commenced an action in quo ivarrcmto to liquidate the order, under the 'authority of § 6111, C. & M. Digest.

“While the allegations of the complaint were not sustained by the testimony, and the court below made a general finding against the State and dismissed the complaint, we take occasion to commend the Attorney General for his action in instituting this proceeding. It was highly praiseworthy for him to have sought to protect the interests of the members of the four hundred subordinate lodges of the order in the State. The facts, as they appeared to him at the time he instituted the suit, after giving the notice required by § 6111, C. & M. .Digest, warranted that action; but explanations have been made which should have been made to the auditors of the Insurance Department and to the Attorney General himself.

A demurrer to the complaint was overruled by the court below, and it is now insisted that the demurrer should have been sustained. The ground of the demurrer was that the Attorney General was not authorized by the law to institute the proceeding. Section 6117, C. & M. Digest, as amended by act 493, General Acts 1921, page 472, exempts certain named fraternal orders from the list of those orders whose financial affairs the Insurance Department is required to audit. Section 16 of the Act of 1921 is the section which amends § 6117, O. & M. Digest, and this section, as amended, does grant an exemption from the operation of this insurance act to certain named orders, and the Knights of Pythias is among those thus exempted; but the insurance department of that order is excluded from the exemption, and the effect of this exclusion is to leave the insurance department of the Knights of Pythias subject to the law. There appears to be a white order and a colored order, both known as Knights of Pythias, and while the statute contains but one general designation, “Knights of Pythias,” we are of the opinion that both orders are embraced in that designation, and that the insurance departments of both orders are subject to audit by the Insurance Commissioner. The demurrer was therefore properly overruled.

The State asked the court to malee a number of findings of fact conforming to the allegations of the complaint, but the court refused to make any of these findings, and this refusal is assigned as error, as constituting n refusal to comply with § 1309, C. & M. Digest, which requires the court, upon trials of questions of fact, to state in writing the conclusions of fact separately from the conclusions of law. We think, however, that the court’s general finding of fact and refusal to appoint a receiver as prayed for sufficiently complies with, the law.

The first declaration of law asked by the State was to the effect that, if. the grand keeper of records and seal, or the committee of the order which audited its books,' negligently, carelessly, or fraudulently failed to keep the cashbook, or the duplicate receipt book, and failed to deliver them to the examiner, when called for by the examiner of the Insurance Department, such failure would be transacting business fraudulently within the meaning of the statute. The court refused this declaration, upon the ground that the testimony did not support the finding of fact that the records had been purposely put beyond the reach of the examiner, and we concur in that view. The particular record which was specially desired was the duplicate .receipt book. This was a larg'e book, and was not in current use at the time of the audit, and had not been for six months prior thereto, and appears to have been lost during the session of the grand lodge at Hot Springs, where the record had been carried from the general offices in Little Rock. The loss of this record was not accounted for to the auditors of the Insurance Department, and the failure to produce it was one of the irregularities insisted upon by the auditors. It may be said that it now appears that proper records are being kept, and are being properly kept. It may also be said that the funds have all been properly accounted for, and the auditors of the Insurance Department now report the order as 100 per cent, solvent. There appears no reason now to believe that the order has been made insolvent by the misconduct of its officers, or that its funds are being wasted or misappropriated by them.

The auditors of the Insurance Department discovered the fast that the grand keeper of records and seal had mingled his own funds with those of the order. This was, of course, an inexcusable thing to do, and tliat officer confessed his error and has abandonee^ his practice. This was done by that officer using money to pay Ms private expenses out of money which would be due him on salary. In other words, he was anticipating his salary by using it as it was earned but before it was payable, and it was shown that he never at aiiy time used any more of the order’s funds than was due him for salary at the time of such use. This appears to have been the practice of the predecessor of the present incumbent and to have been known to the grand lodge trustees.

Another thing reported to the Insurance Commissioner was that the officers of the order had devoted a portion of the order’s charity fund to the defense of certain members of the colored race, not members of the order, who were charged with the commission of a capital offense. It appears that the grand lodge annually appropriated a thousand dollars to be used for general charitable purposes, and there remained $481.65 of this fund, which was appropriated not to the defense of persons accused of crime, but to the members of their families, who were said to be in destitute condition. This cannot be said to have been an improper use of this money, as it was made the duty of the officers of the order to determine who should be’ the beneficiaries of its charity fund, and it does not appear that they acted fraudulently in the matter.

The most serious charge preferred against the officers of the order was that four of them had conspired with a contractor who had been employed to erect a building belonging to the order in the city of Little Rock, and that the contractor, in consideration of being awarded the contract, had paid each of these officers the sum of $250. This charge was based on the testimony of one of the officers, who said he had been paid that sum of money by the contractor. The other officers emphatically denied any knowledge of this agreement, and the contractor also denied that any such agreement had been made, or that he had paid, or had promised to pay, anything to any one for the award to him of this contract.

In further explanation of this very serious charge it was shown that sharp differences existed between these officials, and each had sought the displacement of the other at the election of officers, and, although much bitterness had been engendered by this contest, no charge of bribery had been made at the grand lodge meeting when the officers were- elected, although the alleged bribery preceded the grand lodge meeting. The court below, in refusing to find that the officers of the order had accepted a bribe, evidently discarded the testimony of the officer who gave that testimony. There was no corroboration of Ms testimony, and much contradiction of it, and we cannot say the court should have found otherwise.

The court was requested to make other findings of fact of less importance, but refused to do so, and, upon the whole case, we do not feel warranted in disturbing the judgment of the court below. There were irregularities which should not have existed, but these appear to have been corrected, and the officers have been taught that the management of the order is not their private business which can be run by them without rendering the account to the Insurance Department which the law requires.

Legislation such as we have is getting to be general among the States, and the right of the State to supervise these fraternal and benefit orders, where, they embark in the insurance business, is universally upheld, and, when it is found proper to do so, the right to appoint receivers to take over their affairs will be enforced, and the courts have not hesitated to do so. The courts, however, recognize these statutes as harsh and severe remedies, which will not be applied until all others fail. Note to annotated case of Supreme Sitting of the Order of Iron Hall v. Baker, 20 L. R. A. 210, 214; State v. Bankers’ Union of the World, 99 N. W. 531; State ex rel. Attorney General v. People’s Mutual Benefit Assn., 42 Ohio St. 579; Crombie v. Order of Solon, 27 Atl. 710; Order of International Fraternal Alliance v. State, 26 Atl. 1040; Stendell v. Longshoremen’s Protective Union Benev. Assn., 41 Sou. 228; French v. Gifford, 30 Iowa 148; 19 R. C. L. 1320 et seq.

This insurance order is shown to have nearly four hundred subordinate lodges and a gross annual income of over a hundred thousand dollars, and there are no doubt members who were eligible for insurance at the time of their applications who are no longer so. If the order is put in the hands of a receiver, its usefulness is largely abridged, if, indeed, its existence is not terminated, as the-best risks might seek other insurance, leaving the order liable on benefit certificates to the less desirable risks, and the purpose of the law, which is that of protecting the persons insured, would be defeated by the appointment of a receiver.

The judgment of the court below is therefore affirmed.


text:
    Laseter v. Laseter.
    Opinion delivered February 19, 1923.
    1. Insurance — by-law of benefit society — stepmother as member of family. — Where a stepson had been -at home only occasionally during the five years prior to his becoming of age, -and after-wards married and lived apart from his father and stepmother, until his death, the .stepmother was not -a member of his family, so as to entitle her to the proceeds -of an insurance policy within the meaning of by-laws of a mutual benefit society limiting beneficiaries to members of the insured’s family.
    2. Insurance — -by-laws of benefit society — widow as beneficiary. —-Under by-laws of a fraternal insurance company providing that the beneficiaries should .be limited to members of insured’s family, and that if a designated beneficiary was ineligible the' benefit should go to his widow, held that a benefit certificate taken for the benefit of insured’s widow -and his stepmother was payable to the widow alone where the stepmother was not a member of his family.
    Appeal from Pulaski Circuit Court, Second Division; Guy Fulk, Judge;
    affirmed.

      Buzbee, Pugh & Harrison, for appellant.
    The court erred in dismissing the intervention of the administrator. 53 Ark. 255; 102 Ark. 72; 150 Ark. 317. The courts are divided as to what persons would class as “member of family,” under the by-laws of the order in force in this case. 64 S. W. 8; 22 S. W. 551; 47 Atl. 460; 88 Am. St. Rep. 449; 16 N. W. 871; 87 S. W. App. 268. Our Legislature in act 462, Acts of 1917, classed a stepmother, with others, as a beneficiary. That act is not controlling here, but it is for the insurance society to challenge the stepmother’s eligibility, which was not done. The court erred in dismissing the intervention.

      Rogers & Terral and J. C. Marshall, for appellee.
    The stepmother was not a member of the household of the insured, and was not eligible. 106 N. W. 140; 119 N. E. 426; 126 N. E. 892; Words & Phrases, “Family.” By paying the money into court the society simply recognized liability to the rightful claimant thereto. 163 N. W. 292; 27 Cal. App. 607; 250 Pac. 803; 151 Wise. 155; 138 N. W. 615; 112 Wis. 587; 88 N. W. 606. The exact question involved here, as to the right of the beneficiary under the contract to assert the disqualification of others designated as beneficiaries, has been ruled upon in the following cases: 106 N. W. 140; 92 N. E. 962; 87 N. E. 299; 36 L. R. A. (N. S.) 208. The fact that the member designated his stepmother as his mother is immaterial. 191 S. W. 539; 34 L. R, A. (IN. S.) 1192.
   Smith, J.

In the year 1909 Modern Woodmen of America issued to'William E. Laseter a policy of insurance, or benefit certificate, in the sum of $2,000, payable to William F. Laseter, his father, and Roy Laseter, his brother. On October 6, 1916, he changed the beneficiaries in said certificate, and designated as beneficiaries Mattie Laseter, his stepmother, and Mollie Elizabeth Laseter, his wife. The change of beneficiaries was accomplished, in accordance with the rules of the insurance order, by canceling the original certificate and issuing, in lieu thereof, a certificate in the 'sum of $2,000, payable to Mattie Laseter and Mollie Elizabeth Laseter, “related to said member as mother and wife.”

W. E. Laseter died on the 10th day of July, 1920, and claims were duly presented by Mattie Laseter and Mollie Elizabeth Laseter, the designated beneficiaries. Mattie Laseter’s claim was for a thousand dollars. Mollie Elizabeth Laseter made claim for two thousand dollars, setting up that Mattie Laseter was not eligible to take as beneficiary under the 'by-laws of the insurance order. Modern Woodmen of America promptly paid Mollie Elizabeth Laseter a thousand dollars, but withheld payment of the remainder on account of the conflicting claims of the designated beneficiaries.

Mollie Elizabeth Laseter sued the insurance order, and that defendant filed motion that the administrator of Mattie Laseter (who had died in the meantime) be-made a party, and offering to pay the money into court, although the payment was not made.

The benefit certificate provided that, in case the designated beneficiary should be disqualified, and no substituted beneficiary had been named, the money should go in accordance with the by-laws of the order in force at the time of the death of the insured.

It is admitted that, if Mattie Laseter was ineligible, the entire certificate, under the terms of the by-laws of the insurance order, would be payable to the widow; and it is also admitted that the stepmother of the insured was not eligible as a beneficiary, under the by-laws of the order, unless she was a member of the family of the insured, within the meaning of that phrase as used in the by-laws of the insurance order. Tt is insisted, however, that the stepmother was a member of the insured’s family within the meaning of the by-laws of the order; and it is also insisted that, if she was not a member of his family, that question can be raised only by the insurance order, and has not been raised by it.

The court below found in favor of tlie widow of the insured, and rendered judgment accordingly, and this appeal is from that judgment.

As has been said, the stepmother of the insured was not among the eligible beneficiaries under the by-laws of the order, unless she was a member of the insured’s family, or a dependent upon him; and we think, under the recitals of the agreed statement of facts, she was not a member of his family, nor a dependent. The relation of stepmother is a very tender one, and one’s stepmother might well be a member of his family; but, as we have said, the agreed statement of facts shows the stepmother was not a member of the insured’s family.

It appears, from the agreed statement of facts, that the insured’s father married Mattie Laseter in August, 1907, and that she was never dependent upon the insured for support, and never at any time lived in his home. The insured finished school at twenty-one, and for five years prior thereto came back to the home of his father and stepmother for short periods of time. After finishing- school insured taught continuously until he married in 1915, from which time he maintained a home of his own, and lived separate and apart from his father and stepmother until the time of his death. Under these circumstances the stepmother was not a member of the insured’s family. See the various cases defining the Word “family” in Words & Phrases.

Counsel for-appellant insist that only the insurance order can question the eligibilty of the stepmother, and cite, in support of that contention, the following cases: Johnson v. Knights of Honor, 53 Ark. 255; Longer v. Carter, 102 Ark. 72; and American Ins. Union v. Manes, 150 Ark. 315. In the case of Longer v. Carter, supra, the court said: “It seems to be settled by the weight of authority that, where a member of a fraternal benefit society has the right, under the laws of the order, to change the beneficiary, and does make a change in the manner prescribed by the laws of the order, no one but the -society itself can question the eligibility of the person thus designated, and the original beneficiary has no right to complain, even though the new beneficiary does not fall within the class specified by the laws of the order. In other words, that the society itself may waive the ineligibility of the designated beneficiary, and that the original beneficiary, having no vested interest in the benefit, is not in position to complain.” In that case the insured changed his beneficiary to one who was not eligible to be a beneficiary, and upon the death of the insured the original beneficiary sought to question the qualification of the subsequent beneficiary. The right of the original beneficiary to question the substitution was denied, upon the ground that the original beneficiary had no vested interest in the benefit cértificate, and therefore had no right to question the eligibility of the substituted beneficiary.

The same principle controlled in the case of Johnson v. Knights of Honor, supra. There the certificate was made payable to the insured’s “heirs.” Later the insured married, and died without changing his beneficiaries, and the litigation arose between the widow and the insured’s brother and sister. The court held that the brother and sister, and not the widow, were the heirs, and therefore the persons named in the certificate, .and that their eligibility could not be questioned by the widow, who was not named as beneficiary.

The case of American Insurance Union v. Manes, supra, was one where it was insisted that the benefit certificate was void as being a wager contract; but the court held that, even though it was not binding on the company which issued it, as being a wager contract, a society which subsequently entered into a contract to perform the original contract of insurance could not question its validity.

We have here a different proposition. An eligible and named beneficiary claims the entire benefit, and she is entitled thereto under the by-laws of the order, unless the stepmother is entitled to a paid thereof. We do not understand that the insurance order is waiving the ineligibility of the stepmother; it merely tenders into court the sum it still owes under the' benefit certificate, and asks that it be discharged from liability thereon, and accompanying its motion is a copy of its by-laws, from which it appears that the stepmother is ineligible unless she was a member of the insured’s family.

The case of Logan v. Modern Woodmen of America, 137 Minn. 221, 163 N. W. 292, 2 A. L. R. 1676, is a.case in which the propositions here involved were considered, and the opinion of the Supreme Court of Minnesota in that case is of especial value here, because it construes the sections of the by-laws of the insurance order here under consideration, the insurance order in both cases being the Modern Woodmen of America. In that case Oliver Jones procured a benefit certificate payable to Mrs. Austin, his mother-in-law. He later changed the beneficiary and made his certificate payable to Mrs. Logan, his deceased wife’s niece, who was designated as “related to said member in the relationship of niece.” It was conceded that Mrs. Logan was not a blood relative of the insured, and was never dependent upon him, nor a member of his family. The court said that, as Mrs. Logan was not within any of the classes of persons eligible to be appointed as beneficiary, her designation as such gave her no right to share in the benefit fund of the society. The named beneficiary being ineligible, the court, in construing the effect of the bylaws, said: “If the appointee in the certificate is ineligible, the by-laws step in and appoint another in his stead who is eligible. * * * The appointment of Mrs. Austin as beneficiary was canceled by the assured in the manner prescribed by the by-laws; and the failure to appoint an eligible beneficiary in the new certificate did not revive or reinstate the canceled appointment, but, by -force of the by-laws, made the children of the assured Ms legal beneficiaries,” and the judgment of the court in favor of the children was affirmed.

Here by force of the by-laws the widow is made the legal 'beneficiary, and she therefore takes the share which would have gone to the stepmother but for the ineligibility of the latter.

In that case, as in this, the insurance order tendered the money into court and asked to be discharged from liability, and on that account it was contended there, as here, that the insurance order had waived the ineligibility of the substituted beneficiary. Answering that contention, the court said: “We are also unable to assent to the proposition that the payment of the money into court operated to waive the by-law. By paying the money into court, the society simply recognized liability to the rightful claimant thereto, not to any particular claimant, and its action amounted to nothing more than a demand that the court protect it against a double liability by determining to whom the money rightfully belonged” (Cases cited).'

The case of Cunat v. Supreme Tribe of Ben Hur (249 Ill. 448, 94 N. E. 925) is annotated in 34 L. R. A. (N. S.) 1192. In the annotator’s note it was said that the authorities are unanimous in holding that joining an ineligible person with an eligible one as beneficiary in a mutual beneficiary certificate did not render the certificate void, and that the portion made payable to the ineligible person would, as a general rule of law, be payable to the persons who, under the rules of the insurer, are eligible as beneficiaries. That person here is the wife..

In the case of Logan v. M. W. of A., supra, the court, in construing § 46 of the by-laws, said: “By virtue of this provision, if the beneficiary named is found to be ineligible, the widow, and, if no widow, the children, become the’beneficiaries, and the obligation of the society remains in full force.”

We conclude therefore that the judgment was propprlv rendered in the wife’s favor, and it is affirmed.