author: McHaney, J.

text:
    Stewart-McGehee Construction Company v. Brewster.
    Opinion delivered February 27, 1928.
    1. Appeal and error — -amendment of complaint on remand of case. — Where, on former appeal, it was held that the complaints did not state a cause of action against the bonding company because not filed within -the statutory period, and the cause was remanded for a new trial, it was not error to permit the complaints to be amended so as to charge defendant in an action of debt, where defendant was permitted to amend his answer and to file a cross-complaint.
    2. Principal and agent — authority op contractor’s foreman.— The foreman of a 'building contractor in charge of the construction of a building had implied power to bind the contractor -by placing orders for materials.
    S. Evidence — statement of agent. — In an action by a materialman against a (build-ing contractor for materials furnished but charged in the name of a subcontractor, it was proper to admit evidence of a conversation with defendant’s foreman in charge of the construction of the building in which the foreman told plaintiffs that the subcontractor had abandoned his contract and requested that material furnished be charged in the name of a subcontractor, but that defendant would pay for same.
    4. Principal and agent — apparent authority of - contractor’s foreman. — Defendant contractor’s foreman in charge of construction of a building had apparent authority to direct material-men to -charge material furnished in the name of a subcontractor
    . who had defaulted in his contract, for the convenience of the contractor in keeping an account separate, so that the contractor could hold the subcontractor’s bondsmen liable for the amount thereof.
    5. Trial — disputed question of fact. — Where there is a disputed question of fact on the material issue, it is improper for the court to direct a verdict for either party.
    Appeal from Jefferson Circuit Court; T. G. Parham, Judge;
    affirmed.

      S. L. White, for appellant.

      Rowell & Alexander and Harry T. Wooldridge, for appellee.
   McHaney, J.

This is the second appeal of this case, the first being reported in 171 Ark. 197, 284 S. W. 53. The former case was first affirmed, and petition for rehearing overruled. A short time thereafter appellant paid the-judgments of the two lien claimants, who are the appellees herein. Some months after the first decision the .court, on its own motion, recalled the judgment, amended its opinion, set aside the original judgment of affirmance, and reversed and dismissed the causes on the ground that, at the time the actions were instituted, the appellees did not have claims which might he the basis of liens, following its former decision in the case of Acme Brick Co. v. Swim, 168 Ark. 185, 269 S. W. 369. Thereafter .the appellees filed a petition for rehearing, which was granted, and the former order of the court dismissing the case was set aside, and the cause was reversed, and remanded for a new trial. Thereupon appellant demanded of appellees that they refund it the money it had erroneously paid them, and, upon their refusal to return same, it filed an answer and cross-complaint in each case in the court below, alleging the facts heretofore set out, and prayed judgment against appellees for the amounts paid them. The facts in the original action are stated in the opinion on the former appeal.

The appellees answered, admitting that these payments had been made, but, by way of offset against any claim of appellant, they stated that it Avas indebted to them, as set out in the original complaint, which they pleaded in bar of. any right of appellant on its cross-complaint. They also filed amendments to their original complaints, that the material sold to Shepherd, a subcontractor of appellant, Avas in fact contracted for by appellant, 'but AA7as, at its request, and for its convenience in keeping- separate the amount delivered to Shepherd, charged to Shepherd’s account; that Shepherd had been doing the plastering- work on the building, and that a controversy had arisen because of which Shepherd had. abandoned his contract with appellant, and it was carrying out Shepherd’s contract, and for this reason, in order to fix liability :on Shepherd’s bond to it, it desired the material charged to Shepherd, but that appellant agreed to pay for it; that the material was ordered out by appellant’s superintendent in charge of the building, and that all of the items were in fact delivered to 'appellant, who agreed to be primarily liable therefor, but desired the account carried in the name of Shepherd for its convenience; that, upon the completion of the contract, appellant, through its superintendent, requested a final statement, which was furnished and ok’d by its superintendent, and that the appellees were requested by appellant to bring action against it, Shepherd and the Fidelity & Deposit Company of Maryland, for the purpose of establishing their claims, so that appellant could realize on the bond of Shepherd.

Appellant answered, denying all these allegations, demurred to the amendment to the complaint, and moved to strike the same from the records, on the ground that it stated a new cause of action different from that alleged in its original complaint. The court overruled the demurrer and motion to strike, as also the plea of the statute of frauds, on the ground that said agreement was not in writing. The case was submitted to a jury, and, on a finding in favor of appellees, judgment was rendered for them, from which is this appeal.

We cannot agree with appellant that the court erred in overruling its demurrer and motion to strike. Appellant had been made a party defendant in the original suit because it was the original contractor, having given a bond to the State of Arkansas for the use and benefit of all persons who might have liens, in which it was set up that Shepherd, the contractor, had purchased the material. This was done at appellant’s request in order to fix 'the liability of Shepherd so that appellant might collect from him on his bond given to the principal contractor. In that suit appellant was sought to be held as secondarily liable, that is, liable on its bond to all persons who might have liens. The effect of the decision in the former case was, as finally determined by this court, that the complaints in that case did not state a cause of action against the bonding company, because not filed within the ninety-day period fixed by the statute from the date of the last item of material that had been furnished, and therefore did not fall within the statute giving materialmen a right - of action against the bonding company, one of the defendants, as construed in the case of Acme Brick Co. v. Swim, supra. It did not preclude appellees, on a remand of the case, from amending their complaints in any manner which the facts justified to show appellant primarily liable for their claims. We do not think the cases cited by appellant support his contention in this regard. On a remand of the case the court permitted both sides to amend, appellant to amend its answer and file a cross-complaint, and the appellees to amend their complaints. By permitting the amendment to the complaint, the cause of action was changed from one on the bond to one of debt. Under our liberal system of pleading and amendments to pleadings, we do not think there was any error in permitting this to be done. Indeed, appellees could have filed an original suit against appellant, alleging that it purchased this material, had not paid for it, and praying for judgment for the amount thereof. Certainly, if this could be done, the court did not abuse its discretion in permitting appellees to amend their complaints and try out this matter in the suit pending.

The next assignment -of error is that the court erred in overruling its objections to certain testimony of Brewster and McMillan. This testimony related to conversations had with one Ingram, who was the foreman of appellant in charge of the construction of the building. It is admitted by appellant that Ingram was its foreman in charge of the work, and had authority to order out material for the building as the work progressed.' These conversations were to.the effect that Ingram had told them that Shepherd had abandoned his contract for the plastering of the building, and that appellant had taken same over to be completed by it, and that, for its convenience, so that the plastering account and the general construction account would not get confused, it desired that the material furnished for plastering be charged in the name of Shepherd, but that it would be paid for by appellant. Ingram had authority to order out material as the work progressed, and in fact did order same out from time to time as it was needed, and he had the implied power to bind appellant by placing orders for this material, as it was in the apparent scope of his authority. This, too, regardless of the fact that the president of appellant stated that he had no authority to make ,a contract for the purchase of material, but only to order same out after he had made the contract of purchase. By putting him in charge of the work, with authority to order out the material; he had the implied power to order any necessary material for the building, whether previously purchased by appellant’s president or not. And we think the conversations above referred to were competent testimony, and that there was no error in the court’s overruling the objections thereto. Being the foreman of construction, and being on the job all of the time, with authority to order out material, it was certainly within the apparent scope of his authority to direct appellees to charge the material in the name of Shepherd, who, it is alleged, defaulted in his contract to plaster the building, for the convenience of appellant in keeping the accounts separate, so that appellant could hold Shepherd’s bondsmen liable for the amount thereof.

There was no error in the refusal of the court to instruct a verdict in appellant’s favor, at the conclusion of appellee’s testimony, and at the conclusion of all of the testimony. Appellees had testified to facts and circumstances which, if'believed by the jury, made appellant primarily liable for the debts due appellees as having been ordered out by it directly, with a request to charge it to Shepherd. This was the state of the testimony when appellees rested. Appellant denied this evidence given by appellees, which made a disputed question of fact at the conclusion of all the evidence, making it a case for the jury. "Where there is a disputed question of fact on a material issue, it is not proper for the court to instruct a verdict for either party. ■

Complaint is made to the giving of instructions requested by appellees and in modifying and giving one instruction requested by appellant. We have examined these assignments of error carefully, and find no error in them. We do not set them out, as it would unduly extend this opinion. Suffice it to say that the case was submitted to the jury under correct instructions which fairly submitted the contentions of both sides, and, it having found against appellant, the judgment will be affirmed.


source: Caselaw Access Project

author: Humphreys, J.

license: Public Domain

text:
    Cannon v. Hope Fertilizer Company.
    Opinion delivered February 20, 1928.
    1. Corporations — failures to files annual resport — liability of officers. — In a suit against the administratrix of the secretary of a corporation to enforce Jshe statutory liability for failure to file the annual report required by Crawford & Moses’ Dig., §§ 1715, 1726, a recovery against the estate was warranted, where it was shown that the company was a corporation, that its officers failed to file an annual report, and that during the period of such default the indebtedness was incurred, and that intestate was at the time the secretary of the corporation.
    2. Corporations — proof of official capacity.- — In a suit by the creditors of a corporation to enforce the statutory liability of the president and secretary for failure to file the annual report required by Crawford & Moses’ Dig., §§ 1715, 1726, checks drawn by defendant as president, to which she signed the name of her husband as secretary, which checks were charged to the account of the corporation, held admissible as tending to show that defendant was president of the corporation during the period it defaulted in making its report.
    3. Evidence) — copies of franchise tax returns of corporation.— Authenticated copies of the franchise tax returns by defendant’s deceased husband as secretary of the corporation and by defendant as president, held admissible to show their official capacity in a suit to enforce the statutory liability for failure to file the annual report required by Crawford & Moses’ Dig., §§ 1715, 1726; such copies being made competent evidence by Acts 1921, c. 238, § 1.
    4. Appeial and error — conclusiveness of verdict. — A verdict supported by substantial evidence is conclusive on appeal.

      Appeal from Sevier Circuit Court; B. E. Isbell, Judge;
    affirmed.

      Collins & Collins, for appellant.

      E. F. McFaddin, for appellee.
   Humphreys, J.

This suit was brought in the circuit court of Sevier County by appellee, a creditor of the J. L. Cannon Company, a corporation, in the sum of $1,156.74, to enforce the statutory liability of the president and secretary of said corporation for failure to file the annual report required by §§ 1715 and 1726 of Crawford & Moses’ Digest. All necessary allegations were made in the complaint to fix liability for said amount upon Mrs. E. I. Cannon, as administratrix of the estate of J. L. Cannon, who was the secretary of said corporation, and against her individually as president of the corporation.

Mrs. E. I. Cannon, as administratrix of the estate of J. L. Cannon, filed an answer admitting that she was administratrix of the estate and that J. L. Cannon was secretary of the corporation, J. L. Cannon Company, but denied that the J. L. Cannon Company was indebted to appellee in the sum alleged or that the officers of the corporation had failed to make the report required by said sections of the statutes; and for herself individually denied all the allegations of the complaint, particularly denying that she was ever president of the J. L. Cannon Company.

In the course of the trial it was admitted by appellants that the J. L. Cannon Company was a corporation; that J. L. Cannon was secretary thereof; that J. L. Cannon Company was indebted to appellee in the sum of $1,156.74; that Mrs. E. I. Cannon was the duly appointed and acting administratrix of the estate of J. L. Cannon, deceased; that J. L. Cannon Company was adjudged a bankrupt in the United States District Court on September 13, 1926. The records in the county clerk’s office of said county disclosed that the officers of the J. L. Cannon Company failed to file the annual report of the J. L. Cannon Company required by said sections of the statute.

■ At the conclusion of 'the testimony the trial court peremptorily instructed the jury to return a verdict in favor of appellee against Mrs. E. I. Cannon, as administratrix of the estate of J. L. Cannon, for the amount of the alleged indebtedness, but submitted to the jury the question of the liability of Mrs. E. I. Cannon individually . The jury returned a verdict for the full amount of the alleged indebtedness in favor of appellee against Mrs. E. I. Cannon individually.

An appeal has been duly prosecuted to this court from both judgments.

In order to recover the statutory penalty against the estate of J. L. Cannon, deceased, it was necessary to prove that J. L. Cannon Company was a corporation; that the officers of the corporation failed to file an annual report in the office of the county clerk of Sevier County during the years 1925 and 1926, and that during the period of such default the indebtedness was incurred, and that during the period of neglect to file said report J. L. Cannon was secretary of said corporation. All the facts, except the failure or neglect of the officers to file the report,'were either admitted in the pleadings or in the course of the trial. The records of the clerk’s office disclosed that the report was not filed by the officers of the said corporation during the years 1925 and 1926, the latter year being the year the account sued upon was incurred. This being true, the court correctly instructed the verdict against Mrs. E. I. Cannon, as administratrix of the estate of J. L. Cannon, deceased.

The only additional fact necessary to establish individual liability for the indebtedness against Mrs. E. I. Cannon was to show that she was president of the corporation during the year 1926, which was the period the debt was incurred, and that the officers of the corporation failed or neglected to file the report in the county clerk’s office, required by § 1715 of Crawford & Moses’ Digest. This issue was submitted to the jury, but appellant contends that it was done without any competent evidence to warrant its submission. During the progress of the trial testimony was introduced showing that the stock owned by D. C. Goff in said corporation was sold and reissued to Mrs. E. I. Cannon on October 6, 19’24. Five checks were also introduced in evidence, drawn by Mrs. E. I. Cannon, to which she signed the name of her husband, and these checks were charged to the account of J. L. Cannon Company. Objection was made to the introduction of the checks, but we think they were admissible as a circumstance tending to show that she exercised authority in the operation of the corporate business in an official capacity.

The franchise tax returns of 1925 and 1926, made to the Railroad Commission of Arkansas by J. L. Cannon, as secretary of the J. L. Cannon Company, showed that Mrs. E. I. Cannon was president of said corporation. Appellant objected to the introduction of the authenticated copies of these returns on the ground that they were merely ex parte affidavits. Certified copies of these returns are made competent evidence in any court of this State with like effect as the originals thereof, by act 238 of the Acts of the General Assembly of the State of Arkansas of 1921. Section 1 of said act is as follows:

“ Copies of ian3r record, book, report, paper or other document on file with, or of record in, the office of any public officer or commission of the State, or of any county officer, or any excerpts from such record, book, report, paper or other document, when duly certified by the officer or the secretary of the commission in whose control such record, book, paper or other document is found, shall be received in evidence in any court of this State with like effect as the originals thereof. ’ ’

Although Mrs. E. I. Cannon denied that she was president of the corporation or that she had ever had anything to do with it or its affairs, this certificate was some substantial evidence tending to show that she was president of the corporation. during the period it defaulted, through its officers, in making its report to the county clerk, and during the period the indebtedness sought to be recovered in this suit was incurred. We think it, together with the checks issued by her and cashed out of the corporate funds, was sufficient evidence to send the issue of whether she was president to the jury. The jury found that she was president of the corporation, and, since the verdict is supported by some substantial evidence, appellant is bound by the verdict.

No error appearing, the judgment is affirmed.


text:
    United Friends of America v. Walker.
    Opinion delivered February 20, 1928.
    Accord and satisfaction — acceptance of check. — Acceptance by the beneficiaries of part payment in full settlement of a benefit certificate constituted an accord and satisfaction, precluding further recovery under the policy.
    Appeal from Pulaski Circuit Court, Second Division; Richard M. Mam%, Judge;
    reversed.

      Troy W. Lewis and Clayton Freeman, for appellant.

      Frank Pittard, for appellee.
   Humphreys, J.

This is an appeal from a judgment rendered in the circuit court of Pulaski County for $100 in favor of appellees against appellant on a graded insurance benefit certificate issued by appellant upon the life of Oliver Facen, in which appellees were the beneficiaries. The beneficiaries were the wife and three daughters of the insured. They were ignorant negroes, in the sense that none of them could read and write.

In addition to denying any liability under the certificate, appellant interposed the defense of accord and satisfaction, and, at the conclusion of the testimony in the trial court, moved for a peremptory instruction, which the trial court refused to give, over the objection'and exception of appellant.

The record reflects that, at the time the certificate was issued to Oliver Facen, he was a member of Bethlehem Council No. 88, a subordinate lodge of appellant’s, located at Scott, Arkansas. The certificate provided that, if Oliver Facen should die after the second year of his membership in the lodge, appellant would pay his wife and three daughters $150 if he was “financial” or “clear on the books” of appellant. At the time of the insured’s death he had not paid his dues for September, 1925. According to the contract he had until September 20 to pay his dues, but he died on September 21 without having paid. A dispute arose between appellant and the beneficiaries as to whether appellant was liable for anything under the benefit certificate. Mattie Brewer, formerly Mattie Facen, with friends, went to see C. B. Pettaway, supreme commander of appellant, and demanded payment-of the policy. Pettaway denied all liability, but finally agreed to pay $50 on surrender of the benefit certificate for cancellation to the grand lodge. She procured the certificate from, her stepmother, and surrendered it in exchange for a check in the following words and figures:

“United Friends of America A 6740
“Little Rock,' Arkansas, October 7, 1925.
“Indorsement of this check will be considered as full payment in settlement of policy of Oliver Facen $50.00.
“Pay to the order of Hannah, Mattie, Luella, and Ara Facen $50 fifty and no/100 dollars.
“To W. B. Worthen Company, Bankers, of Little Rock, Ark.
“M. R. Perry, Supreme Secretary.
“ J. R. Currie, Supreme Treasurer.
“Countersigned: C. B. Pettaway, Supreme Commander. ’ ’

Mattie received the check. on the day of its date, and took it immediately to her sister, Ara Walker, and left it with her. That night Ara Walker’s husband read the check to her, and advised- her to cash the check, then sue appellant for the balance of the face of the certificate. The face of the certificate was for $250, but it was a graded certificate, and if the insured liad been clear on the books of appellant only $150 could have been recovered under the clause in the policy which allowed that amount in case of the death of the insured after the policy was two years old. -

Ara Walker kept the check until October 26, 1925, at which time she cashed it at her grocer’s, and kept $12.50 for herself, and gave $12.50 to each of the other beneficiaries. The following indorsement appears on the check: “Hannah Facen, Mattie Facen, Ella Facen, Ara Facen,” together with the name of F. M. Daley, who cashed the check. The check was then presented to and paid by the drawee, W. 'B. Worthen Company, and charged to the account of appellant.

The beneficiaries each testified that the check for $50 was a gift under a clause in the policy providing for a $50 burial payment in case the insured was clear on the books of appellant. There is no testimony in the record, however, tending to show that they were induced to accept the check as full payment in settlement of the policy through deception or fraud practiced upon them by any of appellant’s agents. As appellees were not induced to accept the check through fraud, the acceptance and collection thereof with the following words on its face, “Indorsement of this check will be considered full payment in settlement of policy of Oliver Facen,” was an accord and satisfaction.

On these undisputed facts it was the duty of the trial court to instruct a verdict for. appellant, aud, on account of his refusal to do so, the judgment is reversed, and cause is dismissed.


author: Mehaffy, J.

text:
    Bruce v. Bruce.
    Opinion delivered February 20, 1928.
    1. Homestead — right op widow.- — -In a suit by a widow to recover possession of lands occupied by her husband as homestead, her right to a homestead, if it accrued at all, accrued on the death of the husband.
    2. Homestead — wipe living separate prom husband. — Under Const., art. 9, § 6, providing for the vesting of a homestead, “if widow has no separate homestead in her own right,” a widow who, at the time of her husband’s death, was living separate from him on lands owned in her own right, was entitled to claim the homestead in his property on his death.
    3. Domicile — wipe living apart prom husband. — 'The domicile of a-wife follows that of her husband, though she is living separate and apart from him, and her legal status is governed by that of her husband.
    4. Homestead — abandonment by widow. — Const., art. 9, § 6, providing for the vesting of the homestead in the husband’s land, “if the widow has no separate homestead in her own right,” the fact that a widow lived apart from her husband, whether because of her fault or his, held not to amount to an abandonment of the homestead, where proof showed that the husband, prior to his death, told her that she had a home there whenever she wanted to return as long as she lived, and she recognized the property as her homestead to which she could return.
    Appeal from Polk Circuit Court; B. E. Isbell, Judge;
    affirmed.

      J. I. Alley, for appellant.

      Minor Pipkin, for appellee.
   Mehaffy, J.

A. M. Bruce and Mrs. L. B. Bruce were married several years before the beginning of tbis suit, and lived together about five years. Prior to the marriage Mrs. Bruce owned in her own right a small tract of land on which she lived as her homestead before their marriage, 'and, after she and Mr. Bruce disagreed, she moved back to this place, and lived there until the death of A. M. Bruce, which occurred in October, 1926. Both parties had been married previously and had grown children, but there were no minor children, and no children as the result of this marriage.

Prior to the death of A. M. Bruce he had arranged with his grandson, J. A. Bruce, to move in with him and take care of the place and take care of him. This grandson moved in about a year before Mr. Bruce died.

Soon after the death of A. M. Bruce his widow administered on the estate, took charge of the personal property, and demanded possession of the lands. And when the possession of the lands was ’denied her, she brought this suit. She also sued for damages for the use of the land.

There is no evidence tending to show who was at fault or who caused the separation. Mrs. Bruce herself testified that they could not agree, but that she visited him after she had left him,, and he had told her that she had a home there whenever she wanted to come back, but that she did not go back there to live until after his death.

The case was tried before the court sitting as a jury, and a judgment was rendered for plaintiff, L. B. Bruce, for the recovery and possession of the lands, describing them, and for $40.25 as damages for the unlawful detention of said lands up to the date of the judgment, and at the rate of $116 a year from date of judgment until defendant yielded possession of said lands. The defendant objected and saved his exceptions, and filed motion for a new trial, which was overruled, and the case is here on appeal.

There is practically no dispute about the facts, and, as stated by counsel for appellant, “The first question in this case that presents itself is, what is meant by the constitutional provision to the effect that said widow has no separate homestead-in her own right?”

Article 9, § 6, of the Constitution of Arkansas reads as follows:

“If the owner of a homestead die, leaving a widow, but no children, and said widow has no separate homestead in her own right, the same shall be exempt, and the rents and profits thereof shall vest in her during her natural life. Provided, if the owner leaves children, one or more, said child or children shall share with said widow, and he entitled to half the rents and profits till each of them arrives at twenty-one years of age; each child’s rights to cease at twenty-one years of age, and the shares to go to the younger children, and then all to go to the widow; and provided, said widow or children may reside on the homestead ox not. And, in case of the death of the widow, all of said homestead shall be vested in the minor children of the testator or intestate. ’ ’

Appellant argues that the widow is not entitled to claim homestead out of the lands, because it is alleged she abandoned her husband and lived apart from him on a homestead belonging to her; that she owns and occupies a separate homestead in her own right, and that therefore she cannot claim one from her deceased husband. This is the only question in the case; the question whether she is entitled to a homestead in the lands of her deceased husband.

This is not claimed as the homestead of a wife or the head of a family, but is claimed as the widow’s homestead, and, of course, her right to a widow’s homestead, if it accrued at all, accrued upon the death of her husband.

This court said, in a case where a woman owned a separate homestead and lived on it several years before the death of her husband: ‘ ‘ The only question addressed to us for determination is whether the ownership of the lands in her own right, and upon which she and her husband lived for some years in their early married life, bars her claim of homestead in his lands, which they had occupied as a homestead for many years next preceding and up to his death.”

The difference between that case and this, of course, is that, in the present case, the wife was living on her own place at the time of the death of her husband, and in the case quoted from they had lived on her place but had moved back to his. But in each case she owned it in her own right, and we do not think that the facts in this case would preclude her from claiming a homestead in the lands of her deceased husband.

In the same case above quoted from, the court said:

“In construing the language of this section, this court, in Thompson v. King, 54 Ark. 11, 14 S. W. 926, said: ‘The object of this section is to protect the home of the married and the family against seizure or sale, and no reason can be advanced why the land of the wife occupied as the home of the husband and his family should not be protected 'as well as the land of the husband should be when it is the homestead.’ * * * The separate homestead referred to in the section of the Constitution just quoted is not the separate homestead of the wife, but of the widow, that is, the separate homestead of the widow, selected by her on her own lands after the death of her husband (for she is not the widow until then). * * * In other words, the section was construed to have reference to a separate homestead of the widow, established by her as a widow; that is, after, and not before, the death of her husband.” Wilmoth v. Gossett, 71 Ark. 594, 76 S. W. 1073.

It will, of course, be conceded that, if Mrs. Bruce had lived with her husband on his homestead until he died, she would have been entitled to the homestead, notwithstanding she owned a tract on which she had formerly lived. To hold that the conduct of a man is such that his wife may live with him agreeably until he dies and be entitled to the homestead, and to contend that she would disentitle herself by leaving him, no matter what the treatment may have been, would be unreasonable. She becomes entitled to the widow’s homestead upon his-death, and not before. And the fact that they could not agree, and that this failure to agree made it necessary for her to live apart from him, should not and does not deprive her of her homestead rights under the Constitution.

This court said: ‘ ‘ There is some testimony tending to show that plaintiff did not remain at home with that constancy due from a wife, but it is not sufficient to establish an abandonment "of her husband’s bed and board. Even if there had been such desertion, it did not amount to a forfeiture of the widow’s homestead right.” Brown v. Brown, 104 Ark. 313, 149 S. W. 330.

The question in this case, of course, is that she owned and occupied another homestead, and in the above case it is not contended that she owned another homestead. But the owning of the other property is immaterial. As we have said, her right to a widow’s homestead accrued when he died, and she had a right to select then. And if her abandonment or desertion did not deprive her of this right, certainly the fact that she lived on property belonging to her would not affect it.

In construing the section of the Constitution with reference to a.widow’s homestead, this court has said:

“It would seem that the language of this section of the Constitution settles the question involved in this suit. The appellee had never been divorced from her husband, and she was unquestionably his widow. How then can she be debarred of her homestead right, without reading into the Constitution an exception or provision it does not contain, to the effect that, if the wife abandon her husband, and is guilty of immoral and unwifely conduct, she shall forfeit her right thereby to the homestead? We think such a construction unwarranted and untenable. * ' * * In this State it is held that the domicile of the wife follows that of the husband, and we understand this to be the rule, and that the fact that she abandons her husband, and lives apart from him in another State, will not form an exception, nor cause her to forfeit her right to the homestead. She is not a nonresident while her husband is a resident. Her legal status, as to this, is governed by that of the husband.” Duffy v. Harris, 65 Ark. 251, 45 S. W. 545, 40 L. R. A. 750, 67 Am. St. Rep. 925.

If the domicile of the wife follows that of the husband, and there can be no dispute about this, then the domicile of Mrs. Bruce, although living separate and apart from him, was the domicile of her husband. And her legal status is governed by that of her husband, and immediately on his death she becomes entitled to her homestead as a widow. If, after his death, she had remained on her own property, claiming- that as her homestead, it might have been an abandonment of her homestead in his estate. But she did not do this. She administered on his estate and claimed a homestead as his widow. And what the Constitution means in speaking of a separate homestead in her own right is that, as a widow, and not as a wife, she occupies and claims this homestead, because it says “the 'said widow has no homestead in her own right.” She was not entitled to any widow’s homestead until his death, and if she immediately claimed homestead in her husband’s property, she did not, as widow or after she was his widow, claim a homestead elsewhere.

There is no dispute about the facts in this case. Qur Constitution provides: “If the owner of a homestead die, leaving a widow, but no children, and said widow has no separate homestead in her own right, the same shall be exempt, and the rents and profits thereof shall shall vest in her during her natural life,” etc.

The only controversy iat all is about the following portion of the section: “Has no separate homestead of her own right.” Our'court has construed this to mean a homestead of the widow, and not the homestead of the wife. She becomes entitled to it on his death, and unless, after his death, the widow selects some other homestead, she is entitled to this, and the .fact that she had to .live apart from the husband, whether it was her fault or his, does not amount to an abandonment of the homestead.

It has been said: “The law is not concerned about the precise locality of the family at any time, but it is concerned that, wherever they may be carried by convenience or chance or misfortune, there shall be a place . to which they may return to find the shelter and security of a home. The homestead therefore is not to be likened to prison bounds, within which the family must always remain, but to a sanctuary to which they may always return. And an abandonment is accomplished, not by going away without any intention of returning at any particular time in the future, but by going away with the definite intention never to return at all.” Foreman, v. Meroney, 62 Texas 723.

The undisputed proof is that the husband, prior to his death, told her that she had a home there whenever she wanted to return as long as she lived, and she recognized that as her right, as her homestead to which she could return.

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


text:
    Galion Iron Works & Manufacturing Company v. Otto V. Martin Construction Company.
    Opinion delivered February 20, 1928.
    1. Evidence — varying written contract by parol. — In an action fey a buyer of a steam, roller to recover the amount paid on its purchase price and damages, on account of misrepresentations as to its condition, a letter written by the seller to the buyer prior to the execution of the contract, .stating that the roller was 60 per cent, as good as new and describing 'the boiler as being in good condition, held admissible to show false representations and fraud on the basis of which the sale was entered into, such evidence not being objectionable as varying the terms of the written contract subsequently executed.
    2. Evidence — fraudulent representations. — Parol evidence of representations made toy the seller’s agent that a steam roller was ready to start operation, held admissible in a buyer’s suit for . damages on account of fraud under claim that the roller was worthless, where a contract of sale was subsequently entered into on the strength of such representations, and contained a guaranty that the goods were thoroughly serviceable and practical for the purposes for which they are designed.
    S. Fraud — remedy op buyer. — Where the seller of a steam roller, through its representatives, made false representations as to the condition of the roller for the purpose of inducing the sale, and the buyer, in reliance on such false statements, signed the contract of purchase, the touyer was not bound by the terms of the contract, but had a right to refuse to accept the property and to sue for resulting damages.

      4. Fraud — false representations as basis of suit. — A suit by the buyer of a steam roller to recover payment made and damages on account of the worthless condition of the roller, in which the complaint alleged that, as a result of the seller’s failure to furnish parts in accordance with the contract, the buyer was damaged, was based on false representations, in view- of the allegation that the steam roller was wholly worthless for the purposes for which'intended, and in view of the representations and guaranty that the goods were serviceable for such purposes.
    ■ 5. Sales — right to recover price. — Where a seller falsely represented that a steam roller was in condition for operation, in a suit by the buyer for false representations, it was not entitled to recover on notes given for the purchase price merely because it had supplied missing parts.
    6. Fraud — jury question. — The issue whether the purchase of a steam roller was induced by the seller’s false representations concerning its condition, precluding a recovery of the purchase price, held for the jury under the evidence in the buyer’s action to recover damages for fraud.
    7. Sales — fraudulent representations- — recovery of price. —Where the purchase of a steam roller was induced by the seller’s alleged false representations as to its condition, the seller was precluded from recovering -the amount of the purchase price in the buyer’s action for fraud.
    8. Appeal and error — conclusiveness of verdict. — A verdict supported by substantial evidence will not be disturbed on appeal.
    9. Fraud — evidence.—In a buyer’s action against the seller for false representations in the sale of a steam roller, recovery on account of the worthless condition of the roller at the time of its delivery ■ by the .carrier to the buyer was not precluded by the absence of evidence as to its condition at the time of its delivery by the seller to the carrier.
    10. Fraud — notice of defects.- — -Where a suit for false representations in the sale of a steam roller was based on a claim that the roller was completely worn out and worthless, no notice of the defects was required.
    11. Fraud — sale of machinery — notice of intended use.- — The fact that no notice had been served on a seller as to the uses to which a steam roller was intended, did not prevent a recovery for false representations in its sale, where it appeared from the evidence that the seller knew the purpose for which the roller was to be used, and sold it for that purpose. •
    Appeal from Sebastian Circuit Court, Fort Smith District; J. Sam Wood, Judge;
    affirmed.

      James B. McDonough, for appellant.

      W. L. Curtis, for appellee.
   Mehaffy, J.

The Otto V. Martin Construction Company filed in the Sebastian Circuit Court the following complaint:

“Comes now the Otto V. Martin Construction Company and, for its cause of action against the defendant, states:

“1. That the plaintiff is a corporation duly organized and existing under the laws of the State of Oklahoma, and has been domesticated and secured authority for the purpose of transacting business within the State of Arkansas, and that the defendant is a corporation organized and existing under the laws of the State of Ohio, and has a branch office for the purpose of transacting business within this State.
“2. That on the 8th day of September, 1923, the plaintiff purchased a certain steam roller from the defendant, for which he was to pay the sum of $700 f. o. b. cars at Memphis, Tennessee; that at the time of mailing said purchase he paid the sum of $350 to apply thereon, and. was to pay the remaining $350 on October 1 and November 1, 1923, in equal installments; that the defendant, through its agents and representatives, represented that said steam roller was in first-class operating condition and as good as mew, with the exception of certain parts, which had been stolen, and which said defendant was to replace; that said roller was boug'ht with the distinct understanding between plaintiff and defendant that it was for immediate use upon certain highway construction work in which plaintiff was at that time engaged.
“3. That, when said steam roller reached Fort Smith, Arkansas, it was found to be old, dilapidated, and wholly worthless for the purposes for which the plaintiff intended to use it, and for the purposes which the defendant, through its agents,' knew the plaintiff intended to use it, and that, after notice of its condition to the defendant, it failed, neglected and refused to furnish the parts which it had agreed to furnish to recondition the roller,, or to refund to plaintiff the advanced payments made by it to the defendant on the purchase price of said roller, and for freight and other expenses incurred by it in connection therewith, which resulted in its damages and injury in the following sums, to wit:
1. Amount paid to apply on the purchase price...$350.00
2. To Breslin Boiler Works......................................................... 259.61
3. For freight on same........................................................................ 270.00
Making a total of..........................................................................................$879.61
“That, as a result of the failure of said defendant to furnish said parts in accordance with the terms of their contract and 'agreement, said plaintiff was unable to have the use of said steam roller at the time and for the purposes for which it was purchased, and was therefore required to and did rent a steam roller for the months of November and December, 1923, and January and February, 1924, for which he was required to pay rental of $200 per month, or an aggregate amount of $800, and that, by reason of the matters and things hereinabove referred to, said plaintiff was further damaged by the actions and breaches of the defendant in said sum.”

Plaintiff asked judgment against the defendant for the sum of $1,679.61, and costs.

The appellants owned a second-hand 10-ton steam roller, which was near Pontotoc, in the State of Mississippi. Appellee desired to purchase a steam roller, and, after some negotiations, E. W. Clark, agent of appellee, was sent to examine the roller, but did not go to Pontotoc, but went to Memphis] and did not examine the roller, but entered into a written contract of purchase, with one Berryhill, the sales agent of appellant, at Memphis. Said contract was signed, subject to the approval of Martin. Martin was called by telephone, and approved the contract, and a few days thereafter it was approved by appellant’s executive officer, F. W. Faber, secretary and treasurer. The roller was shipped from Pontotoc, Mississippi, to Fort Smith, Arkansas. The contract referred to is as follows:

“The following described goods, subject to the guaranty and conditions on the back of this order:
“1 Erie steam 10-ton tandem roller (used) just as it stands at Pontotoc, Miss., with exception of parts that have been stolen. We are to repair these. At $700.
“We hereby agree to receive the goods above specified and to settle for same with the Galion Iron Works and Manufacturing Company, Galion, Ohio, by the payment of seven hundred and no/100 dollars as follows: $350 in cash, and balance in warrants, notes or orders, drawn and executed according to law, and bearing 6 per cent, interest from date until paid.
“One note or order for $175, due October 1, 1923.
“One note or order for $175, due November 1, 1923.
“It is understood and agreed that all notes, orders, warrants, checks, drafts, money orders, or other evidences of payment shall be drawn to the order of the Galion Iron Works & Manufacturing Company.
“It is further mutually stipulated and agreed that the title and ownership of all property covered by this contract is to be and remain in said the Galion Iron Works .& Manufacturing Company, its successors 'and assigns, until the purchase price thereof, -with interest as above provided for, has been paid in full. In case any notes or warrants are given in settlement, the title and ownership of all of said property is to be and remain in the Galion Iron Works & Manufacturing Company, its successors or assigns, until each and all of such notes or warrants, or extensions or renewals thereof, or any part thereof, including all protest fees and expenses, have been paid.
“We hereby acknowledge an exact carbon copy of this order, which is not affected by any verbal agreement, but which embodies the entire understanding, and is not subject to countermand.
“Otto Y. Martin Const. Oo.
“E. W. Clark.
“Accepted by the Galion Iron Works & Mfg. Co., Galion Ohio. F. W. Faber, Secretary-Treasurer.”

Following pencil notation: “Paid Ck. for $350 as cash payment. Galion Iron Works & Mfg. Co. By Fred Berryhill.”

On the back:

“ Conditions. All 'agreements are subject to strikes, accidents, or other causes for delay over which we have no control. All claims for defective or broken goods must be made in writing within thirty days after receipt of same. All claims for goods broken or damaged in transit, or shortage in shipment, must be reported • promptly, and said report must be accompanied by the freight receipt, properly noted by local freight agent at point of destination, showing shortage or damage, or both.
“Guaranty. The goods specified on.the reverse side of this order are guaranteed to be thoroughly serviceable and practical for the purpose for which they are designed.
“If found defective in either material or workmanship, we agree to replace such defective parts free of charge, f. o. b. factory. Claims for defective parts must be made within one year from date of sale.
“The Galion-Iron Works & Mfg. Co.
“Galion, Ohio.”

The plaintiff’s testimony tended to show that the roller was being used at the time; that a new one like it would icost from $3,600 to $4,000, and that appellant, m its statements to appellee, estimated this roller to be 60 per cent, as good as new. That it needed some parts, but that it was in good condition. There were no leaks, and it carried from 100 to 110 pounds of steam. The price of the roller was $700, $350 of which was paid in cash and two notes given for the balance. It was reported to Martin that the condition of the roller had been fully described to him, that it was a good buy, and Martin did not see the roller until it was. delivered in Fort Smith, on board the cars; that the roller was ready to start operation, and that neither Clark, the representative sent by appellee to examine the engine, nor Berry-hill, the representative of appellant, ever saw the roller. Clark was a foreman of appellee, and Martin himself confirmed the contract. Martin did not see the roller for three months. It was sent to a machine shop, and Martin saw it in the shop in January. He testified that it was then a mass of junk. He did not get the parts referred to in the contract. He tried to get them, but the roller was out of date, and they did not make the piarts any more. Appellee never did get the parts necessary to put the machine in a condition necessary for operation. Could not get the parts. Paid $259.61 to put the boiler in condition, but could not get the rest of it. Took the matter up with defendant, and defendant sent a representative to Fort Smith in February,.. 1924. ^Representative went with Martin to the machine shop and looked over the roller, and said he did not want Martin to think that the Galion Iron Works does things that way. That Mr. Berryhill had never seen the roller; one of his agents has taken it in, and that he would see that it is fixed up right away, and get the parts. Appel-, lee never did get the parts, however. They do not make them any more. The roller was not made by the Galion Iron Works, but made by another person.

Numbers of letters and telegrams were introduced, and appellee wrote appellant that it was their intention to purchase necessary parts unless they heard from the appellant immediately. That he had been at the expense of something like $200, and yet the matter was unadjusted.

On February 22, 1923, there was a letter from appellee to appellant in which it was stated that they had been “ expecting to receive a shipment of parts for the second-hand Erie roller bought from your Memphis branch the l'atter part of 1923, this arrangement being made by yonr Mr. McDonald on his recent inspection here. Will yon help us to get this roller in working condition at the earliest possible moment?”

Witness testified that he got no reply to this letter; tried to get the parts himself; incurred an expense of $270 in freight and expense of $259,61 in repairing the boiler. He refused to pay this, and told Breslin to sell the boiler for junk; it could not be used; the frame was broken. Witness then testified, over the objection of appellant, that he had to rent a roller at $200 a month. The roller reached Fort Smith probably the latter part of October, 1923. Witness himself did not examine it. He saw the roller the first time when he went with McDonald, February, 1924.

Clark was not present, and witness testified that he did not know where he was. He was with plaintiff about a year ago.

The proof on the part of appellant tended to show that Faber was an executive officer, and had everything to do with making contracts and notes, and he had to approve or disapprove orders, notes or other collateral. When he approved an order it became an obligation. He received written order in evidence in this case, and this order contained the following: “We hereby acknowledge an exact carbon copy of this order, which is not affected by any verbal agreement, but which embodies the entire understanding, and is not subject to countermand.”.

Appellant received the notes; still holds them; had correspondence with plaintiff; received a letter on December 28 concerning the notes; appellant was urging the payment of the notes. That the roller was sold to appellee-as a used roller, and just as it stood at Pontotoc. Agreed to replace all stolen parts, and did replace them.

He testified that there was no report by anybody having authority that the roller Was in first-class condition and as good as new. The contract as set forth in the general order embodies all the terms and conditions, and was approved by the executive officer, and no salesman has any ¡authority to make any verbal statement. Had no knowledge as to the uses to which plaintiff desired to apply the roller. After the order was received, appellant proceeded to replace all parts that were stolen. Had no business relations whatever with the Breslin Iron Works Company. The notes have never been paid. Berryhill took charge of the Memphis office from September 1, 1923, as appellant’s sales representative.

■ We do not think it necessary to set out the testimony any further, except as attention may be called to it hereafter when necessary in the discussion of the questions raised.

The first contention of appellant is that the court erred in admitting letters, telegrams and oral evidence varying and contradicting and adding to the written agreement, and urges that the objection refers especially to a letter dated the 9th of June, 1923. It is contended that that letter, being written three months before the contract wias made, is nothing more nor less thap a part of the. negotiations which ultimately resulted in the making of a contract, and that there is no ambiguity or doubt about the contract, and that appellee did not rely on the letter, because he sent his agent, Clark, to Mississippi and Tennessee to see the roller. It is argued that, since Clark was sent to Memphis to see the roller in operation, this was sufficient to prove that plaintiff did not rely on the letter of June 9.

Appellant cites and relies on Goodwin v. Baker, 129 Ark. 513, 197 S. W. 10. While the court held in that case that prior negotiations leading up to the written contract are merged, and that evidence of a contemporaneous parol agreement is not competent to vary the terms of the written agreement, yet it was said in that case:

“While the terms of the contract cannot be-extended by parol evidence, such evidence may be admitted to show the circumstances under which the contract wtas executed, in order' to construe the language thereof. * * * Courts may acquaint themselves with the persons and circumstances that are the subject of the statements in the written agreement, and are entitled to place themselves in the same situation as the parties who made the contract, so as to view the circumstances as they viewed them, and so as to judge of the meaning of the words and of the correct application of the language to' the things described. •’

The letter referred to .stated where the boiler was situated, what the.appellant gave for it, and also stated the price of a new boiler to be $3,600 to $4,000, and that they estimated this roller to be 60 per cent, as good as new, and further described the boiler as being in good condition, with no leaks, and that it carried from 100 to 110 pounds of steam.

This evidence did not contradict or vary the terms of the written contract. Moreover, another telegram dated July 25, 1923, was not objected to, and it read as follows:

“We assure you that ¡condition of tandem roller has been fully described to you. It is a good buy, and upon receipt of your check for $350 and $350 with six per cent, interest, to be paid within ninety days, will ship roller per instructions your telegrams. Your inspector would be welcomed. ’ ’

This telegram was admitted, as we have said, without objection. Or rather, objection was made and withdrawn. This said that the condition of the tandem roller has been fully described, evidently referring to the description in the letter of July 9.

The next case cited and relied on by appellant is Graves v. Bodcam Limber Co., 129 Ark. 354, 196 S. W. 800. In that case the court reiterates the doctrine that negotiations leading up to the written contract are merged therein, and parol agreements are not competent to vary the terms of the written agreement. In the first place, this letter did not vary the terms of the written agreement. This court has said:

“It follows that, where the parties have by bill of sale, as in this case, or any other instrument, reduced the contract of sale to writing, and have not provided for any warranty, or have incorporated express warranties, no parol evidence can be heard to show in the first .case that there was a warranty, or in the second, that there were other or wider warranties than those expressed. The written instruments are held to contain everything of a contractual character which the parties finally intended should be binding, regardless of all previous negotiations. * * * Deceits, and false representations, intentionally made, regarding material matters, for the purpose of misleading another to his injury, are not contracts in any direct sense. Every one may be presumed, indeed, to agree that he will regulate his conduct by the laws of his country and the rules of fair dealing, and will abide the consequences of failure and detection. But in no other sense are they contracts. They are torts, for which heretofore lay actions on the case for deceit. * * * They differ from warranties in two very material points. The latter cannot, when the contract of sale has 'been reduced to writing, be supplied by parol proof. The former can be shown by parol, for they are torts outside the contract. Warranties bind, if untrue, without any regard to the good faith of the warrantor. This arises from their contractual character. He takes the risk of their truth, and means to bind himself to make a recompense if they are not. But false representations must not only mislead, but must have been made fraudulently and with that intent. * * * He will not be excused for want of candor and good faith with regard to such matters, and will be held responsible for false representations, not made in good faith, believing them to be true. He is bound only to a fair exercise of his own judgment in behalf of the other party, and not for an honest mistake.”

The court, in speaking of instructions, continued: “The eighth instruction remedies the defect, and is, in effect, what the former would have been with the addition above suggested. It might well have been given.” Hanger v. Evins & Shinn, 38 Ark. 337.

This letter was competent, not to vary the terms of the written contract, ¡but to show false representations, deceit and fraud, and this, as held in the case to which we have referred, is not a contract, but a tort. And this evidence did not vary the terms of the contract, but was introduced for the purpose of showing the circumstances under which the sale was made and under which the contract was made, and to show fraud.

Appellant refers to Harrower v. Insurance Co., 144 Ark. 279, 222 S. W. 39. This case reaffirms the doctrine, about which there is no dispute, that prior oral agreements and antecedent writings forming* part of the negotiations for a contract become merged in the -subsequent written contract, and. are incompetent as evidence for the purpose of' enlarging the scope of such written contract.

The letters introduced in this case were not for- the purpose of enlarging -the scope of the written contract, but for the purpose of showing false representations and deceit.

It is contended by the appellant that there is no evidence of any misrepresentations made by the defendant’s agent, Berryhill. Berryhill made the contract with Clark, made the agreement, and on the agreement made was a guaranty that the goods were thoroughly serviceable and practical for the purpose for which they are designed. And Martin testified that Berryhill told him, in a conversation, that the roller was ready to start operation.

“Parol evidence is always admissible to show that an instrument was obtained by fraud or duress, and so to avoid it. In the absence of misrepresentation, fraud, or deceit, a party to a transaction is bound by the writing evidencing the agreement, though he was in fact ignorant of its contents. * * * So, where one has been induced by false representations to indorse a note, parol evidence is admissible to prove that fact. Similarly, parol evidence is admissible to show that -a person was induced to enter a written contract to purchase goods by false -and fraudulent representations as to their quality. * * * Likewise, the rule that parol representations are not admissible to vary the terms of .a written agreement has no application to representations which amount to a fraud practiced in procuring subscriptions to corporate stock. * * * It is a plain fraud to secure the execution of an instrument by representations differing in important particulars from those contained in the paper, and, after the paper has been signed, attempt to compel literal compliance with its .terms, regardless of the contemporaneous agreement without which it would never have been -signed at all.” 10 R. C. L. 1058.

“As a general rule, a person whose rights or liabilities are affected by a written contract may introduce parol evidence to show accident, mistake or fraud, whereby the writing fails to express the actual agreement, and to prove.the modification necessary to be made, whether such variation consists in limiting- the scope of the contract, or in enlarging and extending it so as to embrace land or -other subject-matter which has been omitted through the fraud or mistake. The extrinsic evidence rule should not be invoked as a shield for fraud, or be applied so as to work injustice.” 10 R. C. L. 1056.

The appellant’s next contention is that the court erred in giving, at plaintiff’s request, number 1-a. The instruction reads as follows:

“You are instructed that, if you find from a preponderance of the testimony that defendant, through its representatives, as an inducement, made false or fraudulent statements to plaintiff as to the condition of the roller in question, and that the plaintiff believed said false o.r fraudulent statements, and would not have signed the contract of purchase but for same, then and in that event he would not be -bound by the terms of said contract or order, but would have the right to refuse to accept the property and -sue for whatever damages, if any, is shown that it incurred on account of same.”

This is an action for fraud and false representations inducing the contract, and the instruction above quoted is correct.

The appellant argues that the statement in plaintiff’s complaint, “that, as a result of the failure of said defendant to furnish said parts in accordance with the terms of their contract and agreement, and that he was thereby damaged,” shows conclusively that the complaint was based solely on the written contract. Appellant, however, overlooks that part of the complaint which states: “That, when said steam roller reached Fort Smith, it was found to be old, dilapidated and wholly worthless for the purposes for which plaintiff intended to use the same, and for the purposes which the defendant, through its agents, knew the plaintiff intended to use it,” etc.

When you consider this allegation in the complaint, together with the representations made, not only by letters but by the contract itself, it shows very clearly that the suit was brought on the false representations. The guaranty on the contract said that the goods were gmaranteed to be thoroughly serviceable and practical for the purpose for which they are designed. But the complaint alleges that appellant knew the purposes for which they were designed, and that they were wholly unfit for that. The appellant’s argument made and authorities cited under this claim of error are all based on the theory that the suit was on the contract, and that a party would not be allowed to repudiate or rescind it and sue on it at the same time.

Appellant’s next contention is that the court erred in giving instruction number two. This instruction, however, could not have operated to the prejudice of appellant, because the jury returned a verdict only for $350 that plaintiff had paid and the freight that he had paid.

It is appellant’s next contention that its instruction number five should have 'been given. The complaint is that the court erred in adding to the instruction “unless defendant is precluded from so doing by other instructions.”

The instruction requested was properly refused, because it told the jury that, if the defendant supplied the stolen parts, it was entitled to recover on the two notes.

As we have already stated, the suit is based on. deceit or false statements, and not on the contract. If the contract was induced by false and fraudulent representations, or deceit, then the appellant would not be entitled to recover simply by supplying the stolen parts. And we think the court therefore did not err in refusing to give this instruction.

It is earnestly contended by appellant that the court should have directed a verdict in favor of the defendant for the amount claimed in the two notes. We do not agree with the appellant in this contention. The plaintiff based his action on and directed his proof to the proposition that false representations had been made by the defendant, which induced the purchase of the property. There is sufficient proof on this issue to go to the jury. It is not a question here as to whether we should find for one party or the other under the proof, and not a question of the preponderance of the evidence, but the rule is, if there is any substantial evidence to support the verdict, it will not be disturbed by this court, and there is some substantial evidence to support the verdict.

Appellant argues that the plaintiff furnished no evidence to show the condition of the roller at the time it was delivered to the plaintiff by delivery to the carrier at Pontotoc, Mississippi. There is no direct evidence that the roller was worthless at that time. That is, nobody examined it and then testified as to its condition, but the testimony or evidence as to the condition of it after it reached Fort Smith, if true, shows that its condition must have been the same when shipped from Pontotoc. In other words, it could not have been in good condition, or the condition which appellant said it was in at the time it was shipped from Pontotoc, and then have been in the condition which the evidence shows it was in when it reached Fort Smith. No notice of defects was required, because the suit is based on the claim that the roller was completely worn out and worthless.

As to the proposition that no notice was served on appellant as to the uses for which the roller was intended, we think the proof is ample that appellant knew the purpose for which it was to be used, and sold it for that purpose. In fact, it was alleged by the appellant that-it was, at the time of the contract, being used in Mississippi for the same purpose. The letter of June 9 states that it is on a road being used in road construction in Mississippi ; and we think the testimony in the case, while not very convincing, is sufficient to sustain the verdict, and that the court properly instructed the jury, and the judgment is therefore affirmed.


text:
    McKinney v. New Rocky Grocery Company.
    Opinion delivered February 20, 1928.
    1. Mortgages — jurisdiction to enforce lien. — Where a complaint alleged that plaintiff had bills of sale of lumber which was being removed by defendants, which bills of sale gave him a lien, alleging the insolvency of one of the defendants and the nonresidence of the other, and asking that a receiver be appointed to take charge of the property, and where it appeared that the parties treated the bills of sale, not as an absolute sale, but as mortgages, - and that plaintiff did not seek to take the lumber as belonging to him, by the enforced lien created by the bill of sale, chancery had jurisdiction to enforce the lien.
    2. Appearance — filing answer. — Where a nonresident defendant filed an answer without reserving objection to the court’s jurisdiction of his person, the court acquired jurisdiction over his person.
    3. Appearance — objection, to jurisdiction.' — A defendant appearing specifically to object to the jurisdiction of the court must, as a general rule, keep out of the court for all other purposes, and if he takes any steps consistent with the hypothesis that the court has jurisdiction of the cause and his person, he will be held to have appeared generally.
    4. Frauds, statute op — validity of contract. — A contract between partners and the company whereby the company was to receive a share of the profits of the manufacture and sale of lumber in consideration of advances to one of the partners, held not within the statute of frauds.
    5. Principal and agent — authority op agent. — An agent with authority, to purchase timber and make contracts for manufacture, hauling and shipment of lumber, had apparent authority to enter into a contract on behalf of the principal, whereby a part of the profits from the manufacture of lumber was promised to secure advances to further a shipment of lumber.
    6. Appeal and error — conclusiveness op chancellor’s finding. — ■ Findings of fact by a chancellor will not be disturbed on appeal unless against the preponderance of the evidence.
    Appeal from Little River Chancery Court; G. E. Johnson, Chancellor;
    affirmed.

      T. B. Vcmce, for appellant.

      Shaver, Shaver Williaons and Otis Gilleylen, for appellee.
   Mehaffy, J.

The New Rocky Grocery Company brought suit in the Little River Chancery Court against P. D. Whatley and J. A. McKinney, doing business under the name of the Twin City Lumber Company. It alleged that P. L. Whatley was indebted to the grocery company in the sum of $1,231.18, and that, to secure the payment of said indebtedness, Whatley executed and delivered a bill of sale to certain lumber. Thereafter other bills of sale of lumber were executed and delivered by Whatley to the appellee, and it is alleged that McKinney is a nonresident, living in Brooklyn, New York, and that P. D. Whatley and McKinney entered into an agreement with the plaintiff by which plaintiff was to make certain advances to Whatley to enable bim to manufacture and ship lumber to McKinney, and that appellee was to share in the profits from the manufacture and sale of the said lumber. That, while operating under this agreement, the defendant, Whatley, manufactured and shipped to McKinney large quantities of lumber, on which the appellee was entitled to one-half. the profits. That Whatley and McKinney agreed and undertook to ship and sell the lumber and to account to plaintiff for the value thereof, and that they had shipped large quantities, and failed and refused to account for same, and that they had appropriated the same to their own use.

It was further alleged that there was 75,000 feet of said lumber at Foreman, Arkansas, and that plaintiff had a lien on this lumber, and that the defendants are selling it and removing it from the State, with the intent to defraud plaintiff. That Whatley was wholly insolvent, and defendant McKinney a nonresident. That the accounts between the parties were long, intricate and complicated, and prayed for judgment against Whatley, and asked that the judgment be declared a lien against the lumber. Asked for judgment against McKinney for his part of the profits, and for the appointment of a receiver.

The bills of sale from Whatley to the appellee were filed, affidavit and bond for attachment, and a forthcoming bond was filed by J. A. McKinney.

McKinney filed a motion to dismiss the attachment on the 6th day of March. The complaint was filed on. February 15, and on February 19 the forthcoming bond was filed. On March 6 defendant filed a motion to make complaint more definite and certain, and thereafter filed a separate answer, stating that he did not waive his demurrer.

The court found for the appellee, sustained the attachment, and gave judgment against McKinney and the sureties on the forthcoming bond, and found the indebtedness due the appellee from Whatley. The court also required the plaintiff to make- his complaint more specific in certain particulars, as requested by defendant, McKinney, in his motion.

Appellant contends thát the chancery court had no jurisdiction, and also that the attachment was not properly issued.

Plaintiff alleged that he had bills of sale for lumber which was being removed by the defendants, and that this bill of sale of the specific lumber, describing it, gave him, a lien, which of course, if true, he Could enforce in the chancery court. In addition to this, plaintiff alleged the insolvency of Whatley and the nonresidence of'McKinney, and asked that a receiver be appointed to take charge of the property.

Certainly the chancery court had jurisdiction of this suit. It was the proper court in which to enforce the lien. All of the parties treated the bills of sale not as absolute sales but as mortgages, and plaintiff did not seek to take the lumber as belonging to him by the enforcement of the lien created by the bill of sale. All of the bills of sale given by Whatley were treated as mortgages, treated as creating liens, and not as conveying the absolute title to the property. We therefore conclude that the chancery court had jurisdiction of the subject-matter.

But it is contended that the attachment was not issued in the manner provided by the statute. Since the court had the right to take charge of the property under the allegations in the complaint, without any regard to the attachment, it appears that it would be immaterial whether the attachment was properly issued or not, since, if the court had a right to take charge of the property and did take charge of it, it would be immaterial whether it did it under the attachment or by appointing a receiver, and it is therefore unimportant to decide whether the attachment originally issued was properly issued or not. Moreover, the court permitted an amendment, which it had a right to do.

The main contention of appellant, however, is that the court retained jurisdiction over the appellant by reason of the attachment branch of the suit. The record shows that the court had jurisdiction of the person of McKinney without any regard to the attachment. It is true McKinney gave a forthcoming bond and thereby entered his appearance, but he not only did that, he filed a motion to make the complaint more specific, and did this without reserving any objection to the jurisdiction of the court. Not only this, but he afterwards filed an answer, entering a general appearance and asking for relief from the court.

This court held, on February 13, 1928, in the case of Federal Land Bank v. Gladish, ante, p. 267, that, where one asked affirmative relief of a court, or appeared and pleaded, without reserving his objections to the jurisdiction or to the service, he was in court for all purposes.

“A defendant appearing specially to object to the jurisdiction of the-court must, as a general rule, keep out of court for all other purposes. In other words., he must limit his appearance to that particular question, or he will be held to have appeared generally and to have waived the objection. If he takes any step consistent with the hypothesis that the court has jurisdiction of the cause and the person, such special appearance is converted into a general one, whether it is limited in its terms, to a special purpose or not.” 4 C. J. 1319.

Again: “One seeking to take advantage of want of jurisdiction in every such case must, according to these decisions, object on that ground alone. He must keep out of court for every other purpose. If he goes in for any purpose incompatible with the supposition that the court has no power of jurisdiction on account of defective service of process upon him, he goes in and submits for all the' purposes of personal jurisdiction with respect to himself, and cannot afterwards be heard to make objection.” 2 R.°C. L. 33-9.

We therefore conclude that the court had jurisdiction, not only of the subject-matter but of the person of the defendant.

It appeared from the evidence that Whatley and McKinney had a lumber contract, and that ■ McKinney, doing business as the Twin City Lumber Company, had a representative in Little River County, and that, subsequent to the making of the contract between McKinney and Whatley, McKinney, Whatley and the New Rooky Grocery Company entered into a contract with reference to the profits, or providing- that appellee should have a portion of the profits.

It is contended by appellant that this was for the purpose of collecting1! an old debt due from Whatley to the appellee. But it,makes no difference what appellee’s purpose was, or, rather, it is immaterial whether it was to collect an old debt or not, the alieg-ation and proof are to the effect that he-was to make advances and assist in the manufacture of lumber, and was to have one-half of the net profits. This was a contract that the parties had a legal right to -make, and it is a question of evidence as to whether they did make it.

It is next contended by appellant that the judgment is based, or in part based, on a contract within the statute of frauds. We do not think the statute of frauds is involved, and appellant does, not point out in just what way the statute of frauds affects the case. But it is contended that that part of the judgment giving- appellee a lien for part of the profits is within the statute of frauds. This is what we understand the appellant to argue. We do not think that the contract between the parties was either within the statute of frauds or was without consideration, and this is a question of -fact which was determined by the chancellor.

■Stackhouse was the representative of appellant, superintended or supervised the purchasing, manufacture and shipment of lumber. About this thfere does not seem to be any dispute in the testimony, and if he had authority to purchase timber, make contracts for the manufacture, hauling- and shipment of lumber, the contract-alleged to have been made in this case was within the apparent scope of his authority, and would -bind his principal.

We deem it unnecessary to set out the testimony at length. This court has many times held that the findings of fact by a chancellor, unless against the preponderance of the evidence, will not be disturbed. It would serve no purpose to set out the testimony at length or to call attention to authorities supporting this rule.

We think the chancellor’s finding was sustained by a preponderance of the evidence, and the decree is therefore affirmed..


text:
    Stubbs v. Wright.
    Opinion delivered February 20, 1928.
    1. Corporations — authority of receiver of insolvent corporation. —It was error to direct the receiver of an insolvent corporation ■to take possession of property which did not appear to belong to the corporation for which he was appointed.
    2. Corporations — insolvency—decree for outstanding receiver’s CHECKS. — In insolvency proceedings in which a receiver was appointed for a domestic corporation, it was error to render a judgment for undetermined amount of outstanding receiver’s cheeks and declare the amount thereof a lien against property in the hands of the receiver.
    3. Corporations — foreign corporation doing business in state.— A foreign corporation was not doing business within the State, in violation of the State’s law, where the transactions in which it became a mortgagee of property were interstate, and at a time when it was a partnership, and where, before intervening in a suit as claimant under a chattel mortgage of property within the State, it had complied with the State laws.
    Appeal from Pulaski Chancery Court; Franlt II. Dodge, Chancellor;
    reversed.

      Sam T. & Tom Poe, Floyd Sharp and McDonald Poe, for appellant.

      Horace Chamberlin, for appellee.
   McHaney, J.

Appellant, Stubbs, is the trustee in a chattel mortgage executed by one J. A. Coleman to the Triple XXX Company, a Texas corporation, to secure an indebtedness due it by Coleman of approximately $18,000. The appellee, A. L. Wright, brought this suit against one W. C. Dunn, said Coleman, and the Arkansas Triple XXX Company, an Arkansas corporation, on a promissory note for $800 executed by the Arkansas Triple XXX Company and indorsed by Dunn and Coleman to M. B. Morgan, which he had acquired in due course, alleging the insolvency of the Arkansas Triple XXX Company, and praying the appointment of a receiver therefor, and W. E. Greene, clerk of the court, was appointed receiver for said company. He was directed to and did take charge of the business of the Arkansas Triple XXX Company. He also took charge of the property belonging to said Coleman, which had been mortgaged by him to appellant corporation, and which was being used in the business of the Arkansas Triple XXX Company. The Texas Company was organized as a corporation on January 3, 1927. Prior to that timé it was a partnership, doing business at Galveston, Texas, under the trade name of Southern Beverage Company. It was licensed to do business in Arkansas on July 21,1927. It is the owner of a formula and trade-mark for the manufacture, sale and distribution of root beer, which it has advertised extensively under the trade name of Triple XXX, and it is the owner of various articles of equipment suitable for use in dispensing its brand of root beer. It grants, by contract with sundry people throughout the country, the right or license to make and sell this brand of root beer, and also leases its equipment to be used in dispensing its product, retaining title to the equipment and permitting the use thereof by others, subject to the terms of the license agreement. In March, 1926, prior to its incorporation, Southern Beverage Company, the partnership, leased three lots at the southeast corner of Fourteenth and Main Streets, Little Rock, Arkansas, and erected thereon a small brick building, which is known as a “thirst station,” and equipped same for the sale of Triple XXX root beer. It thereafter on July 26, 1926, leased said property to said Dunn, who contracted to buy the improvements at Fourteenth and Main streets, and entered into a lease agreement for the use of the equipment. Dunn paid a portion of the purchase price in cash, and executed his notes and the deed of trust on the improvements on the leased property at Fourteenth and Main, and a chattel mortgage on the personal property, to secure Ms indebtedness to the Southern Beverage Company. Dunn failed to pay the purchase price in accordance with the terms of the agreement, and in May, 1927, he conveyed all of said property to the appellant, Triple XXX Company, in full settlement of his indebtedness to it, and on May 5, 1927, the same property was resold to said Co'leman for $19,360, of which $1,000 was paid in cash, and for the balance Coleman executed Ms notes, and on June 6,1927, he executed to appellant, Charles J. Stubbs, as trustee for the Triple XXX Company, a deed of trust covering all of the property he had theretofore purchased from the Triple XXX Company. At the time the receiver was appointed and the property involved in this action was taken over by him, Coleman was delinquent in the payment of his notes to appellant. It further appears that, although Coleman and Dunn had organized the Arkansas Triple XXX Company, the title to this property had never been conveyed to it.

On July 26,1927, appellants intervened in this action for the appointment of a receiver, set up its claim to the property held by Greene as receiver, and asked for the delivery of the property to it, and for damages for the wrongful detention of the property.

The appellees answered the intervention, denying its rights, for the reason that it was a foreign corporation, not having complied with the laws of this State, and that it was engaged in business in this State contrary to the laws of this State applying to foreign corporations.

On July 30, 1927, the court entered an order, finding that appellants were entitled to possession of the property involved in the action, directing the immediate delivery thereof by the receiver, but reqMred appellants to execute a bond in the sum of $2,000 conditioned to pay any sums which might finally be adjudged as liens against the property prior to appellant’s claims. Appellants filed the bond conditioned as aforesaid, and took possession of the property. The court also directed the receiver to pay all expenses of operation of the business incurred by Mm, and to file his final report. On August 6 the receiver made an oral report to the court, stating that he had issued checks in connection with the receivership in excess of the funds in Ms hands, and asked the instructions of the court as to the method of procedure to raise the necessary funds to pay the outstanding checks. The amount thereof, nor to whom payable, nor for what purpose, is stated in the record. The court entered a decree declaring the undetermined amount of the unpaid checks of the receiver a lien against the property which he had ordered returned to appellants -on the execution of the bond, prior and paramount to the title of appellants and all other parties to the action, and directed the receiver to take charge thereof and operate the property until a sufficient amount of money was obtained to pay the unpaid checks, unless a sufficient sum of money was paid to the receiver, on or before August 15, to cover the amount of such checks. The receiver was also ordered to prepare and file a written statement, showing the exact amount of each cheek outstanding which remained unpaid, the dates thereof, the name of the payee, and the purpose for which same was issued. From this latter order or decree this appeal is prosecuted.

We think this order was erroneous. In the first place, it is not shown that the Arkansas Triple XXX Company had any interest in the property which the receiver was ordered and directed to surrender to appellants. The receiver was appointed for the Arkansas Triple XXX Company, and for no one else. If the property was not the property of the Arkansas Triple XXX Company, but was the property of J. A. Coleman and appellants, or either or both of them, certainly the receiver of the Arkansas Triple XXX Company had no right or authority to take possession or control of any property that did not belong to it. The receiver was not appointed'to take charge of the property of Coleman. If in fact Coleman had conveyed his equity in the property to the Arkansas Triple XXX Company, then the receiver was justified in taking charge thereof, and in operating it as the property of the Arkansas Triple XXX Company, subject to the rights of appellants therein. And the equity therein of the Arkansas Triple XXX Company, if any, could havé been sold by order of the court to satisfy the claims of creditors of the Arkansas Triple XXX Company. • In the second place, in the order of July 30, the court directed the immediate delivery by the receiver of the property to appellants, and .required them to give a bond in the sum of $2,000 to pay all sums which might be adjudged to be liens against the property prior to the lien of appellants. In the order of August 6 it adjudged an undetermined amount of outstanding checks to be liens superior to the claims of appellants, but did not attempt to enforce them by a proceeding against the bond. Instead, the court ordered the receiver to retalie the property and operate it to pay these sums.. The court could not render a. judgment for an undetermined amount and declare it to be a lien against the property, as the judgment would have to be for a definite and certain sum, and, if a lien at all, the bond should have been subjected to the payment thereof, instead of the repossession of the property.

We do not think there is any merit in the contention that appellant, Triple XXX Company, being a foreign corporation, was doing business in this State in violation of the laws of this State relating to‘foreign corporations. All of the transactions heretofore set out with Dunn were had before the incorporation of appellant, at a time when it was a partnership, doing business as the Southern Beverage Company. The transactions between Coleman and it were had and done in the State of Texas, and were interstate in 'character. It complied with the laws of this State on July 21, 1927, and there- . after filed its intervention. L. D. Powell Co. v. Rountree, 157 Ark. 121, 247 S. W. 389, 30 A. L. R. 414; Linograph Co. v. Logan, 175 Ark. 194, 299 S. W. 609.

For the error indicated the judgment will be reversed, and the- cause remanded with directions to ascertain the amount of the outstanding checks issued by the receiver in payment of the expenses of the receivership, the nature and purpose thereof, and to determine whether such amounts are superior to the lien of appellants, and, if so, to enforce 'collection thereof out of the bond so given by appellants to obtain possession of the property; but, if not, then to collect same out of the bond of petitioner, Wright, given to obtain the appointment of a receiver, in the event there be no assets in the hands of the receiver belonging- to the Arkansas Triple XXX Company. It is so ordered.