text:
    (1) Arkansas Railroad Commission v. Castetter. (2) Cap. F. Bourland Ice Company v. Franklin Utilities Company.

      G. E. Garner, for appellant.

      Horace Sloan and Joe C. Barrett, for appellee.

      Roivell & Alexander, amici curiae.

    (2) Appeal from Sebastian Chancery Court, Fort Smith District; J. V. Bourland, Chancellor; affirmed.

      Robinson, House <& Moses, Pryor, Miles <& Pryor and Harry E. Meek, for appellant.

      Ban W. Bryan, George F. Youmams and Geo. W. Bodd, for appellee.

      Paul McKennon, amicus curiae.

      Jno. W. Stayton, amicus curiae.

   Butler, J.

At the 47th session, of the General Assembly of the State of Arkansas, act No. 55 was enacted for the purpose, as stated in the title, of “regulating the sale, delivery and distribution of ice, and vesting the Railroad Commission with jurisdiction over the same.” The question to be determined in this case is whether the General Assembly, under the limitations upon the legislative power in the State imposed by the Constitutions of the United States and of Arkansas, can fix by law the price of manufacturing ice and provide regulations for the delivery and distribution of the same; and also whether those engaged in the manufacture and distribution of ice may be limited in number in any given territory.

It is claimed by the appellee that said act contravenes (a) the due process of law and the equal protection clauses of the Fourteenth Amendment to the Oonstitution of the United States, and that it is also invalid because it is in contravention of the Constitution of the State of Arkansas and of §§ 2, 3, 18 and 19 of article 2 of the Constitution of the State of Arkansas, because said act deprives the appellees of the right to engage in lawful business, and is a denial of equality of privileges, and authorizes the creation of a monopoly; and (b) that the provisions of the act authorizing the Railroad Commission to fix the price of ice is in contravention óf the due process of law and the equal protection clauses of the Federal Constitution and similar clauses of the State 'Constitution, in that the ice business is not a business affected with a public interest.

There has of late years come into being a school of political science, numbering’ some' of the leading thinkers of this country, which affirms that the aphorism, “competition is the life of trade,” is illusory arid false, and that the best method of protecting the public in the prices it must pay for commodities is that those commodities be manufactured and distributed by monopolies. It is argued that by this means excessive investments and expenses will be eliminated, and therefore an article may be produced and distributed to the consumer at a far less cost than by an unregulated competition. It has been said that “competition is at once an expensive and absolutely ineffective ultimate method of regulating either the rates or the service of the modern municipal public utility, and that the objection to competition is the economic one of the unnecessary duplication of the investment and expense of maintenance and operation of two parallel systems, where one could render adequate service at practically half the cost of the installation, maintenance, and even of operation.” Our Legislature evidently had this idea in mind when it pr ovided, by $ 15 of the act under consideration, that the Railroad Commission should not issue certificates to any person, firm or corporation authorizing the manufacture, sale or delivery of ice at any point where the facilities for the manufacture, sale and distribution of ice already existing are sufficient to meet the public needs therein and in § 16 providing the procedure for carrying its provisions into effect-, and also when, in $ 17 of said act, it provided that in any city, * * * place or community where more than one person * * * is engaged in the manufacture, sale or distribution of ice, and the expenses of such may be decreased, or the business conducted in a satisfactory or economical manner, joint operation of the facilities used for the purposes aforesaid may be authorized, and where it is shown that any one or more of the separate businesses cannot be operated at a profit, or that it would be to the public benefit, then one or more of the parties might acquire the property of the others, or that the parties might consolidate their businesses, “it being the purpose to prevent the duplication of unnecessary plants, facilities and service, and to afford the public prompt and continuous service at just and reasonable prices.”

This may be a sound economic policy, but we cannot consider the expediency of these provisions, for the question for our determination is not that of policy, but of power. In our opinion, these provisions run counter to the g'enius and policy of our organic law, because the virtual effect of the provisions in the statute adverted to is the creation of monopolies, which are abhorrent to the principles of common law and which are expressly inhibited by the framers of our Constitution, in the Bill of Rights contained in article 2 of the Constitution of 1874. By § 2 of said article, the right to acquire and possess property is recognized and its protection guaranteed. By § 3 of the article the declaration is made that no citizen shall be deprived of any right, privilege or immunity. By § 18 the General Assembly is prohibited from making- any grant to any -citizen or class of citizens of privileges or immunities which upon the same terms shall not equally belong ,to- all citizens. Section 19 declares that “perpetuities and monopolies are contrary to the genius of the republic, and shall not be allowed.” By § 29 the declaration is made “that everything in this article is excepted out of the general powers of the government, and shall forever remain inviolate, and all laws contrary thereto or to the other provisions herein contained shall be void.”

A monopoly is said to be “an exclusive right granted to one person or class of persons of something which was before of -common right.” 41 C. J. 82. Bouvier’s Law Dict, defines monopoly as “a grant by the sovereign power of the State, -by commission or otherwise, by which the exclusive right of buying, selling, making, working or using anything is given.” In Seattle v. Denker, 58 Wash. 501, 108 Pac. 1086, it is said: “A monopoly exists when the sale or manufacture is restrained to one or to a certain number.” The power to create exclusive privileges by legislative grant has long been recognized, but in all instances where this power is exercised the individual citizen had no inherent or natural right to engage in the occupation or to use the thing granted. Legislatures have from earliest times granted exclusive ferry, turnpike and wharfage rights, but this was because the thing granted was the exclusive property of the sovereign of which it might have exclusive use, or which it might grant to any designated agency. This is also true of what has now come to be designated as public utilities, such as railroads, municipal lighting and water plants, and the like. The reason for the right to make the exclusive grant was because the one to whom the grant was made could not operate without first permission of the State to exercise some right which was originally and exclusively in the sovereign, or to use the property of that sovereign. But in all of the cases where an exclusive privilege to conduct a business has been granted, the citizen had no right before the grant of the privilege to conduct such business. In other words, the thing granted was not something which was a natural or common right.

Bower to grant an exclusive franchise, where it is shown in the particular case to be justified as a measure for the safety or interest of the public, is unquestioned, but it is essential that the thing granted be something that is not of natural or common right. For instance, one person cannot be restricted in his right to use and enjoy his property in a particular manner in order that another may use his property in that manner to a greater profit than he could if each was left free to use his own as he pleased. Commonwealth v. Bush (Ky.), 26 Am. Rep. 189.

In the case of New Orleans Gas Co. v. Louisiana Light Co., 115 U. S. 650, 6 S. Ct. 252, it was held that the right to operate gas works and to illuminate a city could not be exercised without special authority from the sovereign. The court said: “It is a franchise belonging to the State, and in the exercise of its police power the State could carry on the business itself or select one or several agents to do so.”

The right of the Legislature to prohibit absolutely the engaging in a given calling cannot be doubted, where such calling is inherently injurious to the public health, safety or morals, or has a tendency in that direction (State v. Armstrong, 38 Idaho 493, 225 Pac. 491; 33 A. L. R. 835; Muggler v. Kansas, 123 U. S. 623, 8 S. Ct. 273); and, having the right to prohibit it, would have the right, of course, to prescribe by whom or how the business might be conducted — to permit some to engage in it and deny it to others. But it cannot be said that the manufacture or sale of ice is either injurious to the public health, safety or morals, but, on the contrary, is a useful and necessary occupation. While the manufacture of ice is a modern industry, it is one in which any one might engage as a matter of common right, and did not originally come within the power of the State to license or regulate. Any person, having the means and inclination to engage in that business, might do so without having to call upon the 'State to grant it some power or privilege not common to all citizens alike.

This court, in the case of Ex parte Deeds, 75 Ark. 542, 87 S. W. 1030, in construing a statute denouncing the penalty against any person, etc., who should travel over or through any county and sell certain specified articles, but excepted resident merchants of the county, held the same to be in conflict with the equal protection clause of the Fourteenth Amendment to the Federal Constitution and with § 18, article 2, of the State Constitution prohibiting the General Assembly from granting to any citizen privileges or immunities which were not upon the same terms common to all. The court quoted with approval from Connelly v. Union Sewer Pipe Company, 184 U. S. 450, 22 S. Ct. 431, as follows: “In prescribing regulations for the conduct of trade, it (the State) cannot divide those engaged in trade into classes and make criminals of one class if they do certain forbidden things, while allowing another and favored class engaged in the same domestic trade to do' the same things with impunity. It is one thing to exert the power of taxation so as to meet the expenses of government, and at the same time indirectly to build up or protect particular interests or industries. It is quite a different thing for the State, under its general police power, to enter the domain of trade or commerce, and discriminate against some by declaring that particular classes within its jurisdiction shall be exempt from the operation of a general statute making it criminal to do certain things connected with domestic trade or commerce. Such a statute is not a legitimate exertion of the power of classification, rests upon no reasonable basis, is purely arbitrary, and plainly denies the equal protection of the laws to those against whom it discriminates.”

In Lewis v. State, 110 Ark. 204, 161 S. W. 154, a statute granting the exclusive privilege to take fish in a navigable stream to certain classes of persons and under certain circumstances and denying the right to others, was held unconstitutional as in contravention to the Bill of Rights of our 'Constitution. This also is the effect of the holding in Dreyfus v. Boone, 88 Ark. 353, 114 S. W. 718, but in that particular case it is held that the monopoly sought to be created by the statute was not a private business, but one which the State, under its police power, might regulate and limit in the proper manner. The court there quoted from In re Lowe, 54 Kansas 757, as follows: “While monopolies of any ordinary legitimate business are odious, we have seen that monopolies are upheld when deemed necessary in executing a duty incumbent on the city authorities or the Legislature for the preservation of public health. It is sometimes a matter of great nicety and difficulty to determine whether a particular business or calling is in its nature so directly connected with the public welfare that the performance, can only be safely intrusted to some one acting under public authority. ’ ’

In the case of Replogle v. Little Rock, 166 Ark. 617, 267 S. W. 353, the court, in construing and holding invalid an ordinance restricting and regulating the occupation of plumbing, speaking, through Mr. Justice Wood, said: “Under our State and Federal Constitutions all-men have the inalienable right to acquire, possess and protect property and to pursue their own happiness, and of these sacred rights no man can be deprived without due process of law. Any statute, or municipal ordinance enacted pursuant thereto', which challenges the right of any person to engage in the legitimate and honest occupation of plumbing, without restraint or regulation, must find its justification in the fact that such a statute or ordinance is necessary to promote the general welfare. No individual can be deprived of the right to pursue his happiness in his own way, and to engage in honest toil in any avocation and in any manner he sees proper, in order to make a living for himself and those who may be dependent upon him, so long as he does not use such right in a manner1 to injure others. So long as the individual does not transcend this bound, his conduct is not subject to police regulation. Police power can only be exercised to suppress, restrain or regulate the liberty of individual action when such action is injurious to the public welfare. "When statutes, and municipal ordinances pursuant thereto, have been enacted purporting to protect the health and welfare of a community, all doubts as to the constitutionality of such legislation must be resolved in its favor. * * * But, when such enactments are challenged as an invasion of the rights and liberties of the individual guaranteed by the fundamental law, then it (becomes the duty of the courts to lay these enactments alongside the Constitution and determine whether the exercise of the police power in the suppression or regulation of ordinary occupations, trades or callings is really necessary for the public good.”

In the case of Balesh v. Hot Springs, 173 Ark. 662, 293 S. W. 14, the court considered and held invalid a statute of this State permitting cities of the first class to prohibit the sale of merchandising by auction because in conflict with article 2 of the Bill of Rights of our Constitution. The court there qupted with approval from the case of Butchers’ Union Co. v. Crescent City Co., 111 U. S. 746, 4 S. Ct. 652, as follows: “The common business and callings of life, the ordinary trades and pursuits, which are innocuous in themselves, * * *must therefore be free in this country to all alike upon the same conditions; ’ ’ and from Lawton v. Steele, 152 U. S. 133, 14 S. Ct. 490, as follows: “The Legislature may not, under the guise of protecting the public interest, arbitrarily interfere with private business, or impose unusual or unnecessary regulations upon lawful occupations. ’ ’

In the case of Scougal v. State of South Dakota, 3 S. D. 55, 51 N. W. 858, 15 L. R. A. 477-84, the following declaration is made: “It necessarily follows from the rules above laid down that, if a business is offensive to the community, or injurious to society, and is to be prohibited, it must be prohibited as to all. If it is regulated and controlled, it must be so regulated and controlled as to leave the business or calling free, under such restraints as the Legislature may‘impose, to be exercised alike by all. The government, under the guise of regulation, cannot prohibit or destroy. It cannot deprive any citizen of his right to pursue a calling, occupation or business not necessarily injurious to the community, who is willing to comply with all reasonable regulations imposed upon it.”

Before a statute can be held unconstitutional, it must appear to be in conflict with some constitutional provision, or be opposed to natural right or the fundamental principles of civil liberty. Statutes are presumed to be constitutional and will not -be held to be invalid unless expressly or impliedly forbidden. Dabbs v. State, 39 Ark. 353; Moore v. Alexander, 85 Ark. 171, 107 S. W. 395. But, as the business of manufacturing' and producing ice is a business not inherently dangerous to the public welfare o-r morals, but is a legitimate business in which all might engage as a common right, such business could not be regulated or prohibited as to- some and permitted to others, especially where it is apparent that the right to limit the number engaged in the manufacture and sale of ice at any given point is for the benefit of others engaged in like business, and the benefit to the public would be remote and problematical. It is clear that the §§ 15 and 17 of act No. 55 are violative of the Constitution of this State, and are void.

By § 1 of the act under consideration the Legislature has declared “that the use of ice is a public necessity; that the use, manufacture, sale, delivery and distribution thereof within the State of Arkansas has direct relation to the health, comfort, safety and convenience of the public, the same being a prime necessity of life and monopolistic in its nature, and the price, manufacture, sale and delivery and distribution of ice within the State of Arkansas is hereby declared to be a public business impressed with a public trust and subject to public regulation as hereinafter enacted.” By § 4 of the said act the Railroad Commission of Arkansas is clothed with the power to make and adopt reasonable and just rates and charges for the price of ice manufactured or sold in the State, and for the delivery and distribution thereof, and may adopt all necessary rates, rules, regulations and charges to govern and regulate the manufacture, sale, delivery and distribution of ice and to prevent unjust discrimination and extortion in such business.

The appellees in this case contend that the Legislature is without power, through any of its agencies, to fix the price of ice or to formulate rules for its delivery and distribution, because it contravenes the due process of law and equal protection clause of the Federal Constitution and similar clauses of the State Constitution, and that the ice business is not a business affected with a public interest. It is admitted that, if the manufacture and sale of ice is a business affected with a public interest, the Legislature had the power to enact laws by which the price of the product and its manufacture and distribution might be regulated. As' is said by Mr. Chief Justice Taft in the case of Wolff Packing Co. v. Industrial Court, 262 U. S. 522, 43 S. Ct. 630: “Business said to be clothed with a public interest justifying some public regulation may be divided into three classes: (1) Those which are carried on under the authority of a public grant of privileges. * * * (2) Certain occupations, regarded as exceptional, the public interest attaching to which was recognized from earliest times. * * * (3) Businesses which, though not public at their inception, may be fairly said to have risen to be such and have become subject in consequence to some government regulation; They have come to hold such a peculiar relation to the public that this is superimposed upon them.” In order for the statute to be valid fixing the price and regulating the business of the manufacture and sale of ice, it must come within the third class above mentioned by Chief Justice Taft. It is contended by the appellees that such business is not one affected with a public interest, because such business could be only in the rendition of a service and not in the sale of a commodity; that an ice dealer may or may not sell ice as he chooses; that an ice company has no right to exercise the power of eminent domain, and that the ice business in ‘Arkansas does not constitute a monopoly. In the able and exhaustive briefs filed by counsel for the appellees and amici curiae, a number of cases are cited and quoted from at length to support the position taken by them. They contend that the declaration by the Legislature that the ice business is a public business impressed with a public trust (affected with a public interest) and subject to public regulations, is not conclusive upon the court.

In Wolff Company v. Industrial Co., supra, it is said: “The circumstance of its alleged change from the status of a private business and its freedom from the regulation into one in which the public have come to have an interest, are always subject to a judicial inquiry,” and, where the classification is obviously unreasonable and arbitrary, courts may disregard it. But, as is said in Lindsay v. Gas Company, 220 U. S. 61-78, 31 S. Ct. 337: “When the classification in such a law is called in question, if any state of facts reasonably can be conceived that would sustain it, the existence of that state of facts at the time the law was enacted must be assumed. ’ ’ Appellees assert that the manufacture and preparation of human food, the manufacture of clothing for human wear, and the production of any substance in common use for fuel, have been held to be businesses not affected with a public interest justifying price regulation, and they argue that, if a business dealing in the manufacture and sale of food for human consumption is not a business affected with a public interest and subject to price regulation, the ice business would be a business having certainly no greater interest than the sale of food, and therefore would not be subject to statutory regulation.

A number of cases have been cited to sustain this view, notably that of Wolff Packing Co. v. Industrial Court, supra; Williams v. Standard Oil Co., 278 U. S. 235, 49 S. Ct. 115; Fairmont Creamery Co. v. State of Minnesota, 274 U. S. 1, 47 S. Ct. 506; and Tyson v. Banton, 273 U. S. 418, 47 S. Ct. 426. We have examined with care the case of Wolff Packing Co. v. Industrial Court, supra, and are unable to appreciate that case as authority for the views advanced by the appellees. This case was brought to test the validity of the Court of Industrial Relations Act of Kansas, chp. 29, special session, Laws of 1920, which declared as affected with a public interest the manufacture and preparation of food for human consumption, the manufacture of clothing for human wear, the production of any substance in common use for fuel, the transportation of the foreg'oing, public utilities, and common carriers, and vested an industrial court of three judges with power to hear any dispute over wages or other terms of employment in such industries, and to make findings and fix wages and other terms for the future conduct of the industries.

Under the provisions of the above aot the Industrial Court heard a dispute between the Wolff Company and its employees respecting wages the latter were receiving, and made an order as to wages, increasing them over the figures to which the company had recently reduced them. That controversy reached the Supreme Court of the United States on appeal, where, in considering it, the court said: “It is very difficult under the cases to lay down a working rule by which readily to determine when a business has become clothed with a public interest. All ¡business is subject to some kind of public regulation; but when the public becomes so peculiarly dependent upon a particular business that one engaging therein subjects himself to a more intimate' public regulation is only to be determined by the process of exclusion and inclusion, and to g’radual establishment of a line of distinction. We are relieved from considering and deciding definitely whether preparation of food should be put in the third class of quasi-public businesses, noted above, because, even so, the valid regulation to which it might be subjected as such could not include what this act attempts. ” And further: “We are considering the validity of the act as compelling the employer to pay the adjudged wages, and as forbidding the employees to combine against working and receiving them. The penalties of the act are directed against effort of either side to interfere with the settlement by arbitration. Without this joint compulsion, the whole theory and purpose of the act would fail. ’ ’

It will be seen from the above quotations from the decision that the court did not undertake to consider or decide that the manufacture of public food, clothing, etc., were businesses not affected with a public interest and not subject to a proper regulation by the State.

In Williams v. Standard Oil Co., supra, the court held that the business of dealing in gasoline, whatever its extent, is not a 'business affected with a public interest, because gasoline was one of the ordinary commodities of traffic differing in no essential respect from a great variety of other articles commonly bought and sold by merchants and private dealers in the country, and that there was nothing to justify the conclusion that the sale of gasoline was a monopoly in the State of Tennessee. It is in fact a matter of common knowledge in this State that the business of selling gasoline is highly competitive, and we may reasonably assume that such conditions exist in Tennessee, and were'known to the court.

Tyson v. Banton, supra, was a case involving the validity of an act of the Legislature of New York which sought to regulate the price of theatre tickets. A majority of the court held that the business of selling theatre tickets was not a -business necessary in its nature and differed widely in character and degree from a business which was necessary to the comfort and happiness of the public; that it bore no relation to the commerce of the country, -but that the public merely derived ease and amusement by reason of its operation; that theatres were mere private enterprises, and that the sales of theatre tickets were interdependent transactions standing, both in form and effect, separate and apart from each other and terminating in their effect with the instances. However, to the conclusion and judgment of the majority four .justices dissented, their dissent being voiced in a very-able opinion by Justices Holmes and Stone.

In Fairmont Creamery Co. v. Minnesota, supra, involving the validity of a Minnesota' statute prohibiting qny person, etc., buying milk or cream from discriminating between different localities by paying a higher price in one than in another, in holding the statute unconstitutional, the court said: ‘ ‘ The real question comes to this: May the State, in order to prevent some strong buyers of cream from doing things which may tend to monopoly, inhibit plaintiff in error from carrying on its business in the usual way heretofore regarded as 'both moral and beneficial to the public, and not shown now to be accompanied by evil results as ordinary incidents? * * * The statute itself ignores the righteous distinction between guilt and innocence. * * * It is not permissible to enact a law which, in effect, spreads an all-inclusive net for the feet of everybody upon the chance that, while the innocent will surely 'be entangled in its meshes, some wrongdoers also may be caught.”

“It is very difficult to lay down a working rule by which it may be determined when a .business has become ‘clothed with a public interest,’ ” but it seems fairly certain, from the cases which have passed upon that question, that, where these conditions arise in a given case, then a business may be said to be affected with a public interest, to-wit, when it is such that the public must use its commodities in such manner as to make it of public consequence; where the nature of the service rendered has become indispensable for the convenience and happiness of the people, and where it is fairly probable that excessive charges and arbitrary control of the business may arise.

The leading case perhaps on this subject is that of Munn v. Illinois, 94 U. S. 113, where the question determined was the right of the State to fix by law the maximum charge for storage of grain in warehouses at Chicago and other places in the State having not less than 100,000 inhabitants. In affirming this right, the Supreme Court of the United States, through its Chief Justice, after stating the case, said: ‘ ‘ This brings us to inquire as to the principles upon which this power of regulation rests, in order that we may determine what is within and what is without its operative effect. * * * Property becomes clothed with a public interest when used in a manner to make it of public consequence and affect the community at large. When therefore one devotes his property to a use in which the public has an interest, he, in effect, grants to the public an interest in that use, and must submit to be controlled by the public for the common good, to the extent of the interest he has thus created. He may withdraw his grant by discontinuing the use; but, so long as he maintains the use, he must submit to the control.”

After reviewing the growth of the State and of the businesses regulated by the act under consideration, the court continues: “This indicates very clearly that, during the twenty years in which this peculiar business had been assuming’ its present ‘immense proportions,’ something had occurred which led the whole body of the people to suppose that remedies such as are usually employed to prevent abuses by virtual monopolies might not be inappropriate here. For our purposes we must assume that, if a state of facts could exist that would justify such legislation, it actually did exist when the statute now under consideration was passed. For us the question is one of power, not of expediency. If no state of circumstances could exist to justify such a statute, then we may declare this one void, because in excess of the legislative power of the State. But, if it could, we must presume it did. Of the propriety of legislative interference within the scope of legislative power, the Legislature is the exclusive judge. Neither is it a matter of any moment that no precedent can be found for a statute precisely like this. It is conceded that the business is one of recent origin, that its growth has been rapid, and that it is already of great importance. And it must also be conceded that it is a business in which the whole public has a direct and positive interest. It presents therefore a case for the application of a long-known and well-established principle in social science, and this statute simply extends the law so as to meet this new development of commercial progress. There is no attempt to compel these owners to grant the public an interest in their property, but to declare their obligations, if they use it in this particular manner. * * # It is insisted, however, that the owner of property is entitled to a reasonable compensation for its use, even though it be clothed with a pulblic interest, and that what is reasonable is a judicial, and not a legislative, question. As has already been shown, the practice has been otherwise. In countries where the common law prevails, it has been customary from time immemorial for the Legislature to declare what shall be a reasonable compensation under such circumstances, or, perhaps, more properly speaking, to fix a maximum beyond which any charge made would be unreasonable. Undoubtedly, in mere private contracts, relating to matters in which the public has no interest, what is reasonable must be ascertained judicially. But this is because the Legislature has no control over such a contract. 1S0, too, in matters which do affect the public interest, and as to which legislative control may be exercised, if there are no statutory regulations upon the subject the courts must determine what is reasonable. The controlling fact is the power to regulate at all. If that exists, the right to. establish the maximum of charge, as one of the means of regulation, is implied. In fact, the common-law rule, which requires the charge to be reasonable, is itself a regulation as to price. Without it the owner could make his rates at Will, and compel the public to yield to his terms, or forego the use. * * * We know that this is a power which may be abused; but that is no argument against its existence. For protection against abuses by Legislatures, the people must resort to the polls, not to the courts.”

In the case of Leep v. Railway Co., 58 Ark. 407, 25 S. W. 75, the court recognized the power of the Legislature to regulate a business where same was clothed with a public interest, quoting with approval from the case of Munn v. Illinois, supra, and, as illustrative of the cases wherein such power was properly exercised, referred to the case of Spring Valley Waterworks v. Schottler, 110 U. S. 347, 4 S. Ct. 48, where it is said: “It is within the power of the government to regulate the price at which water should be sold by one who enjoys a virtual monopoly of the sale;” and to Davis v. State, 68 Ala. 58, 44 Am. Rep. 128, upholding an act mailing it unlawful for any person to transport, after sunset and before sunrise of the succeeding day, within certain counties, any cotton in the seed, except the owner might move from his field to his place of storage, because, as is said by the Alabama court, “its object was to regulate the traffic in the staple agricultural product of the State, so as to prevent a prevalent evil, which, in the opinion of the lawmaking power, may have done much to demoralize agricultural labor and to destroy the legitimate profits of agricultural pursuits, to the public detriment, at least in the territory affected;” and, the case of Powell v. Pennsylvania, 127 U. S. 678, 8 S. Ct. 992, holding that the Legislature of Pennsylvania had the power by statute to regulate or prohibit the sale or manufacture of oleomargarine.

Not a great many years ago, the business of ginning cotton wias purely a private business, the owners of many small farms having their own private gins, and, where the farms were too small to warrant this, each small neighborhood having its own community gin. The gins were operated by horses or mules; their construction was simple and their cost small, and at that time and under those conditions they were not the subject of 'State regulation. However, the ginning industry has completely changed, so that now the great modem ginneries gin many times the number of bales in a day that the old-fashioned horse gin could produce, and serve large territories and great numbers of people. Therefore many of the cotton growing States have found that this business has become affected with public interest, and have passed various regulatory statutes, which have been uniformly upheld as a valid exercise of legislative power.

In the case of Simms v. State, 80 Okla. 254, 196 Pac. 132, 23 A. L. R. 1475, the Supreme Court of Oklahoma sustained an act prescribing the retail price of bagging and ties to be charged by the operators of cotton gins. In the case of Tisdale v. Scarborough, 99 S. C. 377, 83 S. Ct. 504, the court said: “A general law with reference to the sale of cottonseed can be enacted. ’ ’ A number of other cases to the same effect are cited in the note to Simms v. State, supra, at pages 1478 et seq. 23 A. L. R.

In Tallahassee, etc., Co. v. Holloway, 200 Ala. 492, 76 So. 434, L. R. A. 1918A page 280, the Alabama Supreme Court, speaking of mills for the grinding of grain, said: “They have always been considered so necessary for the existence of the community that it was proper for government to foster or maintain them. And, in the absence of government aid, the individual proprietor, not pretending to serve the public, might maintain such mills as private mills, free from legislative interference, precisely as he might maintain a store, shop, or other private business; but when such proprietor makes his mill public and assumes to serve the public, then he dedicates his mill to public use, and it becomes a public mill, subject to public regulation and control. * * Cotton gins were, of course, not so classed by the common law, for the reason that they are of comparatively modern invention, dating back no further than the year 1792. The question as to when private property becomes so clothed with a public interest and used in such a manner as to make it of public consequence was treated by the Supreme Court of the United States in German Alliance Ins. Co. v. Lewis, 233 U. S. 389, 34 S. Ct. 612, (and other cases cited). * * * .Any one has, of course, the right to erect a gin for his own private purposes, but, when he undertakes the ginning of cotton for the public, his gin is dedicated to the public use, and, under the authorities above cited, it becomes clothed with a public interest affecting the community at large and subject to governmental regulation.

Act No. 55 of the Acts of 1929 has declared the use of ice a public necessity, having direct relation to the health, comfort, safety and convenience of the public, and monopolistic in its nature, and the business of the manufacture, sale and distribution of ice is declared to be a public business. As we have seen, in order for a business to be said to be clothed with a public interest, the use of its commodities by the public must be such as to make it of public consequence or be of such nature that the service rendered has become indispensable for the convenience and happiness of the people, and where it is fairly probable that excessive charges and arbitrary control of the business may arise. This is in effect the legislative declaration as to thé business of the manufacture, sale and distribution qf ice in the State of Arkansas. Is such a classification so unreasonable that nó state of facts can be conceived that would sustain it? If it is of such nature, then it is the subject of judicial inquiry, and may and ought to be held invalid. We do not think, however, that such classification is unreasonable or arbitrary. It is a matter of common knowledge that the use of ice is universal in all the urban communities of this -State; that it is both convenient and necessary for the comfort and wellbeing of a large proportion of our citizens; that the cost of machinery for the manufacture of ice and its installation is beyond the reach of the average citizen, and that in all -of the smaller towns there is no competition, and the manufacture and sale of ice is conducted by a single manufacturer. These facts warrant the assumption on the part of the Legislature that the business is monopolistic in its nature.

The learned Chief Justice, in the case of Munn v. Illinois, supra, might well have been discussing the growth and character of the ice business in Arkansas and the necessity for its regulation when, after giving a history of the growth of the business then being considered by the court, he -said: ‘ ‘ This indicates very clearly that during the twenty years in which this peculiar business has been assuming its present immense proportions, something had occurred which led the whole body of the people to suppose that remedies such as are- usually employed to prevent abuses by virtual monopolies might not be inappropriate here. For our purposes we must assume that, if a state of facts could exist that would justify such legislation, it actually did' exist when the statute now under consideration was passed. ’ ’

When the rules which have been stated by the cases cited supra, which determine what constitutes a business affected, with a public interest, .are applied to the ice business, it is manifest that a state of facts may well be conceived to exist which will clothe that business with a public interest. The Supreme Court of Oklahoma has so decided in the case of Okla. Light & Power Co. v. Corp. Commission, 96 Okla. 19, 220 Pac. 54, where it is said: “In this situation the distributor of such a necessity as ice should not be permitted, by reason of the impracticability of any one else engaging- in the same business, to charge unreasonable prices. * '* * It may be contended that, if the manufacture, sale and distribution of ice is subject to regulation for the reason that the distributor happens to be the only one engaged in the business in a particular community, a mercantile establishment, which happens to be the only one in a community, would be subject to regulation for the same reason. 'The fallacy of such contention is apparent. Ice is an article of common household necessity, the supply of which must ordinarily be purchased every day. Ordinary articles of merchandise may be purchased at a convenient time and in sufficient supply for ordinary use for a considerable time.”

That the ice business is a business clothed with a public interest has also been held in the case of Denton v. Denton Home Ice Co., 18 S. W. (Tex.) 606, 2d ed.; also in the case of Tombstone v. Macia, 30 Ariz. 218, 245 Pac. 677, 46 A. L. R. 828; and in Saunders v. Arlington, 147 Ga. 581, 94 S. E. 1022. As pointed out by appellees in their several briefs, there are cases taking the opposite view, notably those of Louisiana, Missouri and Wisconsin. However, the Louisiana decision, Union Ice & Coal Co. v. Town of Ruston, 135 La. 898, 66 So. 662, held that the construction and maintenance of a municipal ice plant by a small city operating municipal waterworks and electric light systems could not be maintained by exercise of the taxiing power, because of the peculiar language of the Louisiana State Constitution limiting the taxing- power of municipal corporations under authority delegated by the General Assembly to 'businesses strictly public in their nature. The court holding that the word “strictly,” as used in the Constitution, was used in the sense of undeviating, accurate, governed by exact rules. In the states of Wisconsin and Missouri, where it has been held the ice business is not public in its nature, the climatic conditions are vastly different from those of Arkansas, and the harvesting and storage of ice may be profitably pursued by individuals, and the necessity for the manufacture by artificial means does not exist as in this State.

We therefore conclude that the legislative declaration that the ice business is one properly the subject of governmental regulation is not arbitrary or unreasonable, and must be upheld by this court.

Having determined that §§ 15, 16 and 17 of the act under consideration are void as -within the inhibition of the Constitution, and that it is within the power of Legislature to declare the sale and distribution of ice a business affected with a public interest, and as such the subject of proper legislative regulation, we have lastly to consider and determine whether the act is severable— that is, whether or not the act may stand with §§ 15, 16 and 17, supra, eliminated, or whether the remaining sections are so related to the unconstitutional ones that the whole act must fall.

By § 1 of act No. 65 of the Acts of 1929 the declaration is made that the use of ice is necessary, that the manufacture, sale and distribution of same is monopolistic in its nature, and subject to public regulation. (Sections 2, 3 and 4 grant to the Railroad Commission jurisdiction over the ice business, empowering it to fix prices and rates for the sale, delivery and distribution, and to adopt such rules as might be necessary to carry into effect the powers granted. Section 5 prohibits unjust discrimination, defines same, and fixes penalties for such. Section 6 provides for the printing and publishing of schedules of rates and charges. Section 7 defines the offenses for violation of the rules of the Commission fixing the prices for charges for distribution, for unjust discrimination, and for soliciting or accepting any discrimination. Section 8 requires those engaging in the manufacture, etc., of ice to file with the Commission a schedule of rates and charges for sale and delivery, with a statement giving information as to locality, capacity, persons in charge, etc., and provides for procedure for hearings regarding orders fixing rates. Section 9 provides for procedure for amending or changing regulatory orders. Section 10 and § 11 provide that rates fixed shall be deemed just until otherwise found by the Pulaski Circuit Court, and provides for appeals from orders of the Commission and procedure therefor. iSeotion 12 authorizes the inspection of books and papers. Section 13 requires answers to questionnaires, and provides the penalty for failure to make same under oath within a specified time. Section 14 provides for license fees, etc. Section 16 has no relation to any portion of the act except the section immediately preceding 15), which authorizes the Railroad Commission to deny permit to make or sell ice in a locality where it may determine the facility for those purposes already sufficient. Section 16 provides for the procedure for carrying into effect the provisions of § 15. Section 18 authorizes the Commission to adopt rules governing its proceedings, to regulate the manner of necessary investigations and hearings, and that same be public, and grants power to compel the attendance of witnesses and for production of 'books and papers, and to administer oaths. Section 19 empowers the Commission to employ assistants and regulate their salaries and all expenses to be paid out of funds derived from license fees, etc., and requires the Commission to make an annual report of its proceeds, receipts and disbursements. Section '20 exempts those who make ice solely for their own use or for consumption by their employees. Section 21 repeals all laws in conflict. Section 22 provides that “if any section or part of this act shall be held to be invalid, it shall not affect the remaining portions thereof.”

Even though the Legislature might not have expressed its will that valid parts of a statute should be preserved, though a part might be unconstitutional, it is the duty of the court to accomplish this purpose if, as stated in Cooley’s Constitutional Limitations, 6 ed. p. 210, “a statute attempts to accomplish two or more objects, and is void as to one, it may still be in every respect complete and valid as to the other. But if its purpose is to accomplish a single object only, and some of its provisions are void, the whole must fail, unless sufficient remains to effect the object without the aid of the invalid part.”

The General Assembly of 1917 enacted a special statute creating an improvement district, and authorized the assessment of personal property, as well as real estate, to raise funds to provide for the construction and maintenance of the improvement, and provided that, if any part of the assessment should be declared to be void, then only that part of the property which it was legal to assess should be assessed to defray the cost of the improvement. In the case of Snetzer v. Gregg, 129 Ark. 542, 196 S. W. 925, the personal assessment was declared unconstitutional, and that the entire act was void except for the provision above, but held that, by reason of it, the act was severable, the court saying: “In R. C. L., § 123, is this statement: ‘Occasionally the Legislature expressly states its will that the valid provisions of a statute shall be enforced in spite of any judicial determination that certain sections of the act are unconstitutional. 'Such expression of the will of the Legislature is generally carried out.’ We are not prepared to say that the rule stated by the text-writer can be given general application so as to apply to all cases where the lawmakers may see fit to incorporate such a declaration into a statute, but we do say, when applied to a statute like this, it constitutes a legislative declaration of its full purpose, and that declaration can and should be carried into effect. ’ ’

In Sallee v. Dalton, 138 Ark. 549-56, 213 S. W. 762, this statement is made: “There is another reason why material parts, if not all, of this statute should be upheld, even if assailed portions were void. There is a section of the statute which reads as follows: ‘If, for any reason, any provision of this act shall be held to be unconstitutional, it shall not affect the remainder of the act, but the act, in so far as it is not in conflict with the ’Constitution, shall be sufficient to stand.’ ”

In the case of Snetzer v. Gregg, 129 Ark. 542, 196 S. W. 925, we passed on the question of partial invalidity of a statute, and held, ‘ ‘ that a provision similar to the one in the present case giving expression to the legislative will to put into effect every part of the statute found to be constitutional and valid, was effective to preserve intact parts of the statute found to be valid, even though other portions of the same statute were violative of the Constitution. ’ ’

In the case of Nixon v. Allen, 150 Ark. 244, 234 S. W. 45, the act before the court was an act, “as shown by its title as well as the subject-matter of its various sections * * * a comprehensive and complete plan of government for the county of Pulaski. Section 28 of the act provided that, if any part should be held to be unconstitutional, that decision should not affect the validity of its remaining portions. The court held that § 1 of the act, which provided for two county .judges for Pulaski County, was in conflict with § 28, article 7, of the Constitution, and that § 8, creating a board to fix the salaries of county officers and the salaries and numbers of their clerks, was a delegation of legislative authority, and void under § 4, article 16, of the Constitution. After an examination of the remaining sections of the act, the court, after carefully reviewing and considering same as related to the section violative of the Constitution, concluded as follows: “A critical analysis of the various provisions of this act discloses that §§ 1 and 8 touch at some angle nearly all of the provisions of the act, except those embodied in the two last sections (the two' last sections were § 28, noted supra, and § 29, providing the act to be supplemental to existing laws and not to repeal any except as are in conflict with the act). Sections 1 and 8 are to this act as is the hub to the wheel and the foundation pillars of a building. Since these two sections fall under the condemnation of the constitutional inhibition, they must be removed from the act, and thereby the whole fabric of the county government built up by the framers of this law necessarily falls to pieces. ’ ’

Examining the act in the instant case in the light of the decisions of this court and applying to its construction the rules therein announced, we conclude that the act is not dependent upon §§ 15, 16 and 17, supra. They do not “touch at some angle nearly all the provisions of the act;” they are not “to this act as is the hub to a wheel and the foundation pillars of a building,” but seek to accomplish a different purpose to the remainder of the act, and are neither necessary nor helpful for carrying it into effect. Without the invalid sections (15, 16 and 17) we have a comprehensive and workable plan for the regulation, sale, delivery and distribution of ice, and those sections are not indispensable or helpful in carrying this purpose into effect. The remaining sections of the act do not relate to and are not dependent upon the invalid sections. We are therefore of the opinion that the act is severable, especially with the aid of the expression of the legislative will- that it should be so construed, and with such declaration it is manifest that the Legislature intended that the plan regarding the price and distribution of ice should stand, even though those sections inserted, by which were given to the ice manufacturers a monopoly, should be unconstitutional.

It follows from what we have said that §§ 15, 16 and 17, supra, must be stricken from the act, and that the remainder of the act is a valid exercise of the legislative power and an expression of its will, and therefore must stand.

Inasmuch as the cases brought to this court on appeal were for the purpose of preventing the appellees from engaging in the ice business in Fort Smith and Jonesboro, Arkansas, the decree of the court in each case, in so far as it holds the act in question unconstitutional as to §§ 15,16 and 17 and dismisses the complaint of the appellants for want of equity, is affirmed.


source: Caselaw Access Project

author: Haut, C. J.,

license: Public Domain

text:
    Hisey v. Sloan.
    Opinion delivered January 13, 1930.

      D. E. McGowan and Caraway, Baker & Gautney, for appellants.

      Eugene Sloan, for appellees.
   Haut, C. J.,

(after stating the facts). It is contended that the court erred in not allowing the minors to redeem the land from the tax sale, and, in this contention we think counsel are correct. Our statute authorizes the sale of land delinquent for nonpayment of taxes, and it also contains a saving clause, granting* to minors the right to redeem the land from the tax sale within two years after the expiration of their disabilities as minors. This court has uniformly held that all the world must take notice of the statute granting to minors the privilege of redeeming the land from a sale for taxes. Bender v. Bean, 52 Ark. 132, 12 S. W. 180; Seger v. Spurlock, 59 Ark. 147, 26 S. W. 819; Hodges v. Harkleroad, 74 Ark. 343, 85 S. W. 779; Bradbury v. Johnson, 104 Ark. 108, 147 S. W. 865; Ann. Cas. 1914, 6, 419; and Lightle v. Laws, 123 Ark. 537, 186 S. W. 73.

Counsel for appellee, Sloan, the purchaser at the tax sale, seeks to uphold the decree holding the tax sale valid, for the reason that appellants did not raise this issue in their complaint, and did not offer to redeem the lands therein. Appellee, Sloan, filed a cross-complaint in which he asks that the title be vested in himself, under his purchase at the tax .sale. When this was done, it became the duty .of those representing the minors to raise the issue for them, and if they did not do it, it became the duty of the court to protect their interest. The court did treat this as an issue, .as appears from the decree, hut the chancery court was wrong in decreeing that the title .should vest in appellee, Sloan, without giving the minors the right to redeem. This issue was raised toy the cross-complaint, and by the facts on this point recited in the decree, and the court erred in not allowing the minors the right to redeem from the tax-sale.

Again, counsel seek to uphold the decree upon the ground that there is no bill of exceptions, and' that oral evidence was introduced at the trial. The decree does show that oral evidence was introduced, but it also undertakes to recite all the facts dn the decree itself, upon which the chancellor based his opinion. This court has uniformly held that no bill of exceptions is necessary, where the judgment of the lower court, reciting the facts on which it is based, shows error on its face. Baucum v. Waters, 125 Ark. 305, 188 S. W. 802, and cases cited; Sizer v. Midland Valley Railroad Co., 141 Ark. 369, 217 S. W. 6; and Howell v. Miller, 173 Ark. 527, 292 S. W. 1005.

The error of the chancery court in not allowing the minor children the statutory right of redemption appears upon the face of the record. Not only the facts recited in the decree were part of the record, but the pleadings in the case were also a part of it. Therefore, the error of the court was apparent from the face of the record itself, and no bill of exceptions bringing in the testimony on the record was necessary.

Inasmuch as the decree must toe reversed for the error in not allowing the minors their statutory rights to redeem from the tax sale, we will call attention to their rights, and the rights of the purchaser at the tax sale upon redemption. The purchaser at the tax sale was entitled to a deed two years from the date of the sale, and, aft'er the execution of the deed, the purchaser was entitled to the possession of the land. The existence of the right of redemption in the minors until two years after majority has the effect of making such right a condition subsequent to the tax deed. The same law under which the purchaser acquired his right to the land also confers the right of redeeming upon the minors. I/Vithout redeeming, the minors hold no present interest, and can only assert a right to the rents after they have offered to redeem. Lightle v. Laws, 123 Ark. 537, 186 S. W. 73; Bender v. Bean, 52 Ark. 132, 12 S. W. 180; and Seger v. Spurlock, 59 Ark. 147, 26 S. W. 819.

These authorities hold that the tender made 'by the owner to the purchaser is the point at which the title changes, and the positions are reversed. Up to’ that time, no rents are due from the purchaser, while all moneys paid out for taxes and the value of all the improvements are due to him. Improvements made after an offer to redeem, and taxes paid afterwards, except by contract, are not charges against the owner or on: the land, and the purchaser in possession is bound for rents accruing after that date.

Inasmuch as the case does not seem to have been developed upon this point, the decree will be reversed and the cause will be remanded, with directions to the chancery court to' allow the minors their statutory right of redemption, and to settle the question of taxes and improvements in accordance with the principles of law above laid down, and for such further proceeding’s as may be necessary under the principles of equity, and not inconsistent with this opinion.


author: Hart, O. J.,

text:
    Ezzell v. Oil Associates, Inc.
    Opinion delivered January 13, 1930.

      Patterson <S> Rector, for appellants.

      Marsh, McKay S Marlin, for appellee.
   Hart, O. J.,

(after stating the facts). As will be seen from our statement of facts, the lease contains no express covenant as to the number of wells that should be drilled after the completion of the first one producing 011 or gas in paying quantities. It did not contain any covenant requiring the drilling of producing wells to prevent oil or gas from draining from the leased premises to the adjoining lands, where wells by other parties might be drilled and operated.

It is the contention of the lessors that there was an implied covenant, on the part of the lessee, to prosecute the development work with reasonable diligence, and that it was its duty, after the completion of the first well, to continue the search for and the production of either oil or gas with reasonable diligence on the remaining part of the leased premises.

On the other hand, it is the contention of the lessee that it was not required to further continue its operations for oil or gas, nor to pay the rental provided in the lease and supplemental contract after the failure to do so, but that the lease continued in force under its own terms as long as oil or gas continued to be produced in paying quantities on the well brought in section 11 on the leased premises.

A clear and comprehensive statement of the rule of law governing cases of this sort may be found in a case note to 11 L. R. A. (N. S.), commencing at page 417. After stating that oil and gas leases are peculiar in their nature, and that courts are more inclined to construe a lease with greater latitude as forfeiting the lease for failure to develop than in construing leases of other minerals, the editor continues as follows:

“Generally all leases of land for the exploration and development of minerals are executed by .the lessor in the hope and upon the condition, either express or implied, that 'the land shall be developed for minerals; and it would be unjust and unreasonable, and contravene the nature and spirit of the lease, to allow the lessee to continue to hold under it any considerable length of time without making any effort at all to develop it according' to the express or implied purpose of the lease; and, in general, while equity abhors a forfeiture, yet, when such a forfeiture works equity, and is essential to public and private interests in the development of minerals in land, the landowner, as well as the public, will be protected from the laches of the lessee and the forfeiture of the lease allowed, where such forfeiture does not contravene plain and unambiguous stipulations in the lease. This principle will be more readily enforced and applied by the court as to gas and oil cases, because of the peculiar nature of those minerals, and the danger of entire loss to the lessor of oil or gas in his lands by reason of well drilling on adjacent lands. ’ ’

In Ann. Cases 1917E, p. 1126, it is said: that in oil and gas leases, where the owner of the land leases the same for a nominal sum and the further consideration of a royalty or a percentage of the profits realized by the lessee in working and developing the land, in the absence of an express agreement, there is an implied covenant that the lessee will use reasonable diligence in commencing and continuing operations. Numerous cases are cited which support the rule.

While there is a conflict in the authorities upon this subject, we think that the rule above laid down is established by our previous decisions upon the subject, as well as by the better reasoning.

In Mansfield Gas Co. v. Alexander, 97 Ark. 167, 133 S. W. 837, it was held that where a lease of land for the purpose of prospecting for gas and minerals was executed in consideration of the lessee’s agreement to pay royalties upon such gas or minerals, the law implies a covenant upon the lessee’s part to begin the exploration for gas and minerals within a reasonable time. In dis.cussing the subject, the court said that the authorities uniformly hold that there is an implied obligation on the part of the lessee to proceed with the search, and also with the development of the land with reasonable diligence, according to the usual course of such business, and that a failure to do so amounts, in effect, to an abandonment, and works a forfeiture of the lease.

It was further held that where a lease of land, for the purpose of prospecting, for gas and minerals, was executed in consideration of the lessee’s agreement to pay royalties upon such gas or minerals, the law implies a covenant upon the lessee’s part to begin the exploitation for gas and minerals -within a reasonable time. In discussing the subject, the court said that the authorities, uniformly hold that there is an implied obligation on the part of the lessee to proceed with the search, and also with the development of the land with reasonable diligence,' according to the usual .course of such business, and that a failure to do so amounts, in effect, to an abandonment, and works a forfeiture of the lease.

Again, in Mansfield Gas Co. v. Parkhill, 114 Ark. 419, 169 S. W. 967, it was held that in every oil and gas lease a covenant is implied that the lessee will prosecute a diligent search and operation, and when the only consideration for the lease is a royalty, a failure on the part of the lessee to commence operations for a period of ten years will be held to be an abandonment, and the lessor may have the lease canceled, even though he has failed to notify the lessor of his intention to. have the lease canceled.

In Mauney v. Millar, 134 Ark. 15, 203 S. W. 10, where the court had under consideration the construction of the lease of a diamond mine, it was held that where the sole benefit of a contract results from a continued perf ormance of the contract (such as to develop, a mine, to operate it, pay royalties or to divide the proceeds), where one party completely abandons the performance thereof, equity will give relief by canceling the contract. For a partial breach the parties will be remitted to their remedies at law, but for abandonment equity affords relief by rescission or cancellation.

In Millar v. Mauney, 150 Ark. 161, 234 S. W. 498., it was held that, where the conduct of the lessees in mining-leases, given in consideration of royalty to be paid, is such as to show that the lessees do not intend in good faith to perform the covenants by which they are bound, they have, in legal effect, rescinded those covenants and released the lessors from the obligations of the contract, and the latter are justified in treating the contract as rescinded. In that case it was also held that where a lessee in a mining lease, the consideration of -which is a royalty to be paid, has, after a reasonable time, failed to begin and to continue the work of development and exploration provided in the contract, the lessor has three remedies, viz: (1) he may sue in equity to cancel the contract and recover incidental damages; (2) he may sne at law for damages for breach of the contract, or (3) he may treat the contract as rescinded, and sue at law to recover possession of the property leased.

In Drummond v. Alphin, 176 Ark. 1052, 4 S. W. (2d) 942, it was held that where an oil and gas lease, covering 27 scattered tracts of land, provided that in case operations were not commenced and prosecuted with due diligence within one year, the lease should be void, but that a forfeiture could be prevented by payment of quarterly rentals until drilling operations were commenced, after which no rent was to be paid, a drilling of two wells was not a compliance with the lessee’s obligation to continue development of lands.

¡So it may be taken, as the well-settled rule in this State, that there is an implied covenant on the part of the lessee in oil and gas leases to proceed with reasonable diligence in the search for oil and gas, and also to continue the search with reasonable diligence, to the end that -oil and gas may be produced in paying quantities throughout the whole of the leased premises.

It is true that the original lease provides for the payment of $3,000' in common stock of an operating oil company, controlled by the lessee, to be given to- the lessors, but the principal consideration for the lease was the payment to the lessors of a part of the oil and gas produced on the leased premises. "Where the payment of royalties is the principal consideration for the execution of the lease on the part of the lessors, it is evident that the parties contemplated that oil should be searched for and produced with reasonable diligence, to the end that both parties might be profited by the production of oil or gas in paying quantities. Because of the •absence of an express provision as to the number of wells to be drilled, it does not follow that this matter is subject alone to the will of the lessee. There is in every lease for the pro.duction of oil and gas, where the principal consideration is the payment of royalties, a condition, implied when not expressed, that, when the existence of either oil or gas in paying quantities is found from drilling wells on the leased premises, the lessee should drill such number of wells as in the exercise of sound judgment he may deem reasonably necessary to secure oil or g'as for the mutual advantage of the lessor and the lessee. One of the principle reasons is that oil and gas are of a wandering and vagrant character, and this has been recognized by the courts, and oil and gas leases have been construed with reference to this well known characteristic. Hence it becomes necessary for the lessee to use reasonable diligence in exploring the leased premises for oil or gas, and to continue to do so after a well has been brought in, showing the existence of oil or gas in paying quantities, in order to carry into effect the purpose and object of the lease.

Of course, due deference should be given to the judgment of the lessee as operator to determine how many wells should be drilled, but he must use sound judgment in the matter, and cannot act arbitrarily. He must deal with the leased premises so as to promote the interest of both parties, and to protect their mutual interests. He must act for the mutual advantage, and proceed for both of them, and must not consider his own interest wholly, or for the most part. He must perform the contract so as to further the original purpose and intention of the parties.

In White v. Green River Gas Co., 8 Fed. (2d Series) 261, the court held that two wells in five years on about 900 acres of land was not reasonable diligence. This case was relied upon, and cited with approval, in Drummond v. Alphin, supra. M'any other illustrative cases are cited in the briefs, but we do not deem it necessary to cite them, or to review them in this opinion.

The lease under consideration embraced 1,170 acres of land. One well was brought in on section 11, which produced oil in paying quantities. The -lessee claimed that, as long as this well produced oil in paying quantities, he was entitled to operate it without the payment of the additional rent provided in the lease, and without further drilling of additional wells. To so hold would enable it to speculate upon a lease which embraced a large block of land, and to relinquish operations at any time he saw fit to do ¡so-, without in any manner consulting the interest of the lessors. It is true that-the drilling of oil wells is very costly, but the parties understood this when they executed the lease. The lessee only agreed to pay the lessors one-eighth of the oil produced as rent, and reserved seven-eighths of it for its own profit in drilling the well, and in undertaking the risk of not finding any oil. Then too', after drilling the first well, the lease continued in force for1 5- years, and as long as oil was produced in paying quantities, without the lessee being required to- pay any further rental. If the lessee wished to avoid the expense- and risk of continued exploration for the discovery of oil or gas, it should have paid the additional rental provided by the lease and the supplemental contract.

Therefore, we are of the opinion that the court erred in holding that there was not an abandonment of operation upon the whole 1,170 acre tract by the lessee, and in not canceling the lease contract. In this connection, it may be stated that the appellants did not ask for a cancellation of that part of the ¡contract relating to the well brought in in section 11, and now operated by the lessee, and the ten acres of land immediately surrounding it.

It is next contended that appellants are not entitled to proceed in equity to have the lease canceled, but that their remedy at law to recover damages is adequate. We do not think that contention is well taken. Here, again, we are confronted with the peculiar character of this kind of lease. When we consider the migratory character of oil and gas, and the fact that, if the lease should not be canceled, for noncompliance with its terms, there would be a cloud left upon the title of the lessors, and it would be extremely difficult for them to- secure another lease on the land. It is not like the case where a specified rental is to be paid for a definite term, a subsequent lessee would know exactly where he stood, and the risk he ran in accepting a lease which had a definite period to run, and a fixed sum of money to be paid as rental. Here the original lease provided for its duration for a period of five years, and as long thereafter as oil or gas was produced in paying quantities. The consideration was a continuing one, to be paid only by the labor and expense of the lessee in the development of the property. The lessors had a continuing interest in the leased premises, and the lessee was not at liberty to do with the property as he pleased. He could not use, or fail to use, it to the prejudice of the lessors. It would be very difficult for the lessors, in cases like this, to establish and prove their injury in damages. The lessee was not required to develop the property against his will. He could quit at any time he saw fit to. do so, and the lessors could not require specific performance on the part of the lessee, however solvent he might be.

It is true that the court, in Blair v. Clear Creek Oil & Gas Co., 148 Ark. 301, 230 S. W. 286, 19 A. L. R. 430, in a suit by the lessors to cancel the lease on the ground that the lessee was drawing off the gas from the land through wells drilled on adjoining lands without drilling protection wells on the leased lands, held that a court of equity, having taken jurisdiction for the cancellation of the lease, might award damages to the lessors; but that is very far from holding that this was the only remedy the lessors had. Under the facts of that particular case, the remedy by damages was the only one that would avail the lessors anything. Part of the damages had already been incurred, and a decree cancelling the lease would not have given them an adequate remedy.

As held in Millar v. Mauney, 150 Ark. 161, 234 S. W. 498, the lessor might either sue for damages, or he might 'cancel the contract in equity, and recover the incidental damages, as was done in the Blair cáse. Here the lessors elected to proceed in equity to cancel the lease, as the remedy most effectual to protect their interest. This they had the right to do.

Finally, it is contended that the court should not have canceled the lease under the facts proved. We cannot agree with counsel in this contention. It is true, as claimed by them, that the lessors did commence, in 1923, to claim that the lease had been abandoned by- the lessee, but it does not appear that this had the effect to prevent the lessee from continuing the exploring of the land for oil and gas. No suits of any character looking to that end were brought by the iessors. - On the other hand, they were urging the lessee to proceed with diligence to the exploration of the remaining land for oil or gas. The lease was assignable, and the lessors did nothing to- prevent the lessee from assigning' the lease to any one. The lease comprised 1,170 acres of land, and oil wells were being brought in on lands in the same neighborhood. Only two wells were drilled upon the entire tract, and only one of them became a producing well. No other drilling- operations were even commenced by the lessee. Under these circumstances, we think that the chancery court erred in not cancelling- the lease for abandonment by the lessee. The question of abandonment or not is a mixed question of law and fact, and each case must depend upon its own particular facts and circumstances. The intention of the lessee cannot be gathered from any statement of his alone. It must he determined from his intention, as shown by his acts and conduct. When the illusory character of oil and gas is considered, when the danger of oil and gas being drained from the leased premises by wells being 'drilled on contiguous tracts of land, when the cost of installing drilling machinery is considered, and when all the customary expense incidental to drilling in oil fields are considered together, we are of the opinion that the chancellor erred in not cancelling the whole lease, as requested by appellants; and for this error the decree must be reversed, and the cause remanded with directions to the -chancery court to cancel the lease, except-the 10-acre tract surrounding the well in section 11, and for further proceedings according to the principles of equity, and not inconsistent with this opinion.


author: Smith, J.

text:
    Blackwood v. Sibeck.
    Opinion delivered January 13, 1930.

      Hal L. Norwood, Attorney G-eneral, Claude Duty and Walter L. Pope, Assistants, for appellant.

      Neill Bohlinger, for appellee.
   Smith, J.

The question involved in this appeal is the liability of the -counties of the State for the payment of the license fee, for the issuance of the tag or plate, which is placed upon motor vehicles -owned by the counties, and used exclusively for public purposes.

In -support of the contention that counties are not required to pay this license fee, we -are cited to- that portion of article 16, § 5, of the 'Constitution, which reads as follows: “* * * Provided, further, that the following property shall be exempt from taxation: Public property used exclusively for public purposes.”

In further support of this contention, there is cited the case of Board of Improvement v. School District, 56 Ark. 336, 19 S. W. 969, wherein it was announced, as a rule of statutory construction, that ¡counties and other governmental agencies are exempt from taxes, unless the statute imposing the taxes expressly, or by necessary implication, provides that they shall not be exempt.

Answering these contentions in the order stated, it may be first said that the imposition of this license fee is not a tax, within the meaning of the Constitution.

The case of Pine Bluff Transfer Co. v. Nichol, 140 Ark. 320, 215 S. W. 579, involved the validity of an aci authorizing the levy of a tax in Jefferson ¡County upon automobiles carrying passengers and freight, and in up^ holding the validity of the act we quoted from the case of Fort Smith v. Scruggs, 70 Ark. 549, 69 S. W. 679, as follows: “The license fee imposed is, then, not a tax upon property, but is in the nature of a toll for the use of the improved streets. In other words, it is the privilege of using vehicles on the improved streets, and not the vehicle itself, that is taxed. We are therefore of the opinion that the statute is not subjeict to the criticism that it authorizes double taxation, and the ¡contention of the defendant on that point must be overruled.” See, also, State v. Handlin, 100 Ark. 175, 139 S. W. 1112; St. L. Sw. Ry. Co. v. State, 106 Ark. 321, 152 S. W. 110; Floyd v. Miller Lbr. Co., 160 Ark. 17, 254 S. W. 450, 32 A. L. R 811; Standard Oil Co. v. Brodie, 153 Ark. 144, 239 S. W 753; Stanley v. Gates, 179 Ark. 886, 19 S. W. (2d) 1000.

'The ¡case of Board of Improvement v. School District, supra, did not hold that public property mig’ht not be taxed, but held only that there was a presumption against any such intention on the part of the Legisla ture, and that such a tax ¡could be levied and collected only when the authority so to do was expressly conferred, or arose by necessary implication from the legislation imposing the tax. As the reason for this rule, the court quoted from 'Cooley on Taxation (2d ed.) page 172, as follows:. “Some things are always presumptively exempted from the operation of general tax laws, because it is reasonable to suppose they were not within the intent of the Legislature in adopting them. Such is the case with property belonging to the State, and its municipalities, and which is held by them for governmental purposes. All such property is taxable, if the State .shall see fit to tax it; but to levy a tax upon it would render necessary new taxes to meet the demand of this tax, and thus the public would be taxing itself in order to raise money to pay over to itself, and no one would be 'benefited but the officers employed, whose compensation would go to increase the useless levy. It cannot be supposed that the Legislature would ever purposely lay such a burden upon public property, and it is therefore a reasonable conclusion that, however general may be the enumeration of property for taxation, the property held by the State, and by all its municipalities for governmental purposes, was intended to be excluded, and the law will be administered as excluding it in fact.”

There is therefore a presumption that the Legislature did not intend to impose this privilege tax on the property of the counties; but there is no limitation upon the power 'of the Legislature to do so, and the question is, has the Legislature sufficiently manifested the intention that the tax shall be paid by the counties to overcome the presumption to the contrary1? A review of the legislation on the subject convinces ns that it has, and that the counties must pay the tax.

Act 494 of the General Acts of 1921 (General Acts 1921, p. 490), is an act entitled, “An act to regulate the registration of motor vehicles and for other purposes.” Section 2 o>f this act provides what the license fee shall be, and how it shall be ascertained. Section 3 of the act provides that none of the fees provided by section 2 shall be charged against any vehicle, the title to which is in the Federal, 'State, or any county or city government, and directs the Highway Department to issue appropriate registration cards, and sets of plates free of charge, except the actual cost of said registration car and plates for any of the vehicles so owned, upon appropriate affidavit as to the title being filed. In the case of vehicles owned by the county, the statute provided that the affidavit should be made by the county judge.

By act 52 of the Acts of 1929 (Acts 1929, vol. 1, p. 103), § 3 of act 494 of the Acts of 1921 is expressly repealed, and by § 1 of act 52 it is provided that no automobile license tax shall be issued or furnished by the .State Highway Department to any person, firm or corporation until a receipt signed by the duly authorized collector has been filed with the State Highway Department, showing that the full amount of said license fee as required by law has been paid.

Act 65 of the Acts of 1929 (Acts 1929, vol. 1, p. 264), as its title indicates, is a codification of the laws relating to State highways, and, by § 29 of this act, it is made the duty of the Highway 'Commission to furnish to the sheriffs of the various counties application blanks for the registration of motor vehicles on or before January 1 of each year. These blanks bear serial numbers, and are charged to the sheriff in the same manner in which poll tax receipts are charged to the collectors by the State Auditor, and the sheriff is required to pay $35 for any blank not returned or accounted for.

Other sections of the act provide that the sheriff can issue receipts for the motor license only upon the payment to him of the fees required by the act. Upon the exhibition of this receipt it becomes the duty of the Highway Commission to issue to the applicant a registration card and tags or plates. There is no other authority for the issuance of these registration cards or tags.

The only exemption from the payment of this license fee is found in § 35 of act 65, which reads, in part, as follows: ‘ ‘ Motor vehicles belonging to the United States Government, and used in its business exclusively, shall not be required to pay any motor vehicle fuel tax or exhibit a State license plate, but in lieu of a State license plate shall have exhibited thereon a license plate in a form approved by the State Highway Commission, showing that they are United States Government motor vehicles. ’ ’

It thus appears that in the case of this — the only— exemption from the act, the State license plate does not have to he obtained or exhibited, and the inference is therefore clear and irresistible that the Highway Commission cannot issue registration tags or plates, except upon the production of a receipt for the license fee which the law requires.

The excellent brief of the Attorney General cites many cases on this question, all of which are in harmony with the views here announced.

A general statement of the law appears in 42 C. J., page 670, in the chapter on motor vehicles, which reads as follows: “The fact that municipally owned motor vehicles are exempt from taxation, as property, does not exempt them from being licensed and registered under the State license regulations of motor vehicles.”

Among the numerous oases cited in the note to the text quoted, and in the brief of the Attorney General, is that of State v. Preston, 103 Ore. 631, 206 Pac. 304, 23 A. L. R. 414, which is a well-considered case exactly in point. In discussing the effect of an act of the State of Oregon, imposing’ a license fee on certain motor vehicles, and exempting certain others, the Supreme Court of Oregon said: “When the Legislature declared what motor vehicles should not be affected by the act, those not within the exception were without it,” this result being reached by the application of the maxim applicable alike in, the -construction of constitutions and statutes, “eccpressio unius est exclusio alterius.”

We conclude therefore that the counties of the .State are required to pay the fee upon motor vehicles owned by them, and the judgment of the court below, to the contrary, is reversed, and the cause will be dismissed, and it is so ordered.


author: ■Humphreys, J.

text:
    Truemper v. Burnette.
    Opinion delivered January 13, 1930.

      Moore '& Moore and Jo M. Walker, for appellant.

      W. G. Dinning, for appellee.
   ■Humphreys, J.

This is an appeal from a judgment for $2,907.50, rendered in the circuit court of Phillips County in favor of appellees against appellant for one-half the original cost of a brick wall, less the cost of a portion thereof, which was not restored after same was injured by fire. The original wall was constructed by appellees, partly on their lot and partly on appellant’s, which lots adjoined, under a written agreement that appellant would pay them one-half of the actual cost of the wall .before using same in any way, except to- attach, the north side of his present warehouse thereto.

It was in contemplation of the parties, at the time the contract was made, that appellees would immediately build a two-story brick house on their lot, and that later appellant would build a two-story brick house on his, and that then the wall in question should become a party wall upon the payment of one-half the cost thereof by appellant to appellees. Appellees constructed a two-story brick building on their lot in 1920, one-half of the south wall of which extended over on the lot belonging to appellant. The actual cost of the wall was agreed upon, and attached to the written contract as a part thereof.

Appellees ’ building was destroyed by fire in 1926, and the wall in question was damaged. After the fire appellees repaired the first story of the wall in question, and used same in the construction of a one-story ¡brick ¡building. In repairing the wall they built a ledge out several inches near the top thereof so that it might ibe used by appellant when he built his house. Subsequently, appellant built a one-story brick building on his lot, the north wall of which was made of brick, mortar and cement about eighteen inches thick. It was constructed by pouring the mixture against the wall built by appellees, and behind the temporary frame wall erected that distance from the wall in question so as to support the mixture until it hardened sufficiently to stand. The joists of appellant’s 'building rested upon this concrete wall. The rafters of the roof rested upon the ledge mentioned jrlbove, and the roof was flashed into the ledge, a part of the way, and into a brick laid on top of the ledge the balance of the distance.

The -cause was sent to the jury over appellant’s objection, upon the theory that he would be liable to- appellees for one-half the cost of the original wall less the cost of the portion thereof not restored after the fire, provided appellant had used the wall constructed by appellee-s in any way.

Appellant contends the trial court erred in submit-' ting to the jury the question whether he used the wall in any way built and repaired by appellees, for the reason that the undisputed evidence reflects that his north wall was constructed by pouring a concrete wall between a frame, erected by him, and the wall built' by appellees, upon which the joists of his building rested, and that he used the ledge extending out of appellees’ wall over his own land as a support for his roof; and that these acts did not constitute a use in any way of the wall constructed and repaired by appellees. Appellant’s conclusion that the facts do not tend to show that he made any use of the wall, constructed and repaired by appellees, is incorrect. In erecting his north wall he poured the concrete against the wall constructed by appellees, which tended to show that he used said wall as a support for his; and the appropriation of the ledge in their wall, as a support for the roof of his house, tended to establish a use of their wall by him.

The issue therefore of whether he used the wall in any way, constructed and repaired by appellees, was properly submitted to the jury for determination.

Appellant also contends for a reversal of the judgment because the trial court incorrectly instructed the jury as to the measure of damages. In this contention he is right. One-half of the actual cost of the wall, as repaired after the fire for a one-story building, constituted the extent of appellant’s liability to appellees. After the fire neither appellees nor appellant desired to ibuild a tiwo-story house. Each used the wall in the construction of a one-story building, and by their acts modified the contract for the construction of the wall in this respect. The contract was not abandoned or abrogated on account of the damage to the original wall by fire, but the wall was repaired by appellees, and used by the parties jointly as a one-story, instead of a two-story, wall.

On account of the error indicated, the judgment is reversed, and the cause is remanded for a new trial.


author: Mehaeey, J.

text:
    Titsworth v. Mena.
    Opinion delivered January 13, 1930.

      Alley Olney, for appellant.

      Duke Frederick, for appellee.
   Mehaeey, J.

The appellant was charged with the crime of transporting liquor from place to place in Mena, Arkansas, and on the 8th day of October, 1929, he was convicted in the city court, and fined $100. He appealed to the circuit court, where a trial was had on October 30, 1929, and he was there found guilty by a jury, and his fine fixed at $100. He filed motion for a new trial, which was overruled, and to reverse the judgment of the circuit court, he prosecutes this appeal.

Mrs. Bill Watkins was, at the time, October 3, 1929, operating the Blue Front Cafe, and was assisted by her husband, 'Bill Watkins.

Doug Walker, a deputy sheriff, testified that he saw the appellant about the third o,f October in the Blue Front Cafe in Mena, leaning on the counter on his arm; that he went down the street and got Mr. Harris, the night policeman of Mena, told him about what he had seen, and they went back to the Blue Front Cafe; that Mr. Harris went in and talked to the restaurant man and they left the cafe; went across the street and watched the appellant. The restaurant man tried to wake up appellant, and then witness and Harris went to the cafe, and got appellant out. Appellant, according to this witness, was very drunk. Harris finally took appellant under the arms, and picked him up, and witness took one arm and Harris the other, and appellant kept Ms hand up. Witness did not know why, but when they got across the street Harris pulled appellant’s jumper back and pulled out a pint of whiskey out of his pocket. That was the first time witness had seen the whiskey. Appellant was locked up in jail. Witness did not see anybody else in the restaurant when they first saw appellant there. When he went back there he did not see any one else go in or out, Mr. and Mrs. Watlrins being the only ones that witness saw. Appellant was lying on the table. It was about 20 minutes from the time they first passed the cafe, until they went back and arrested appellant. Witness said that Harris had the whiskey that they took from appellant.

Harris, the night policeman, testified to substantially the same facts that Walker did, and also that he talked with the owner of the restaurant, who said he did not know appellant. Witness tried to talk to appellant, but appellant did not answer him. This witness also said that appellant was drunk. This was about 9 o’clock at night. Appellant never said anything with reference to the liquor at all. This witness testified that there was no one in the Blue Front Cafe but the restaurant man and his wife. There was about one-half an inch from the neck of the bottle o'f liquor. Witness did not see appellant transporting the liquor. This witness presented the bottle of liquor, and said-it was in about the condition it was when they arrested appellant.

Bill Watkins, the restaurant man, testified that his wife ran the Blue Front Bestaurant; that she was running it on the -3d of October, and that he stayed there and helped his wife run the restaurant; recalled the time that Harris and Walker arrested appellant, and said that appellant had been in the restaurant something like an hour, but that he had done nothing but sleep; did not know whether he had any liquor on him, or not, and did not see the bottle. Witness did not see appellant come in, but there was no one with him when witness first saw Mm. There were two or three persons who passed in and out of the restaurant, after appellant came in. Appellant was asleep at that time. There was nohody who appeared to 'be with him. Appellant came in and ordered some coffee. At that time witness did not notice that he was under the influence of liquor. They were about to close the restaurant when the 'officers took appellant out. They closed the restaurant somewhere about Mne or ten o’clock. Witness did not put this liquor in appellant’s pocket, and did not see anybody else put it there.

Mrs. Watkins testified substantially the same as her husband, except that she saw the appellant when he first came in; did not talk to him; only spoke to him when he came in. He ordered a icup of coffee, and witness waited on him. He went to sleep on the counter, and did not drink the coffee. Appellant came in by himself, and went to sleep and did not wake up any more until the -officers took him out. When he came in, he did not act like anything was wrong with him. This witness testified that she did not put the whiskey in his pocket, and never saw anybody with the whiskey; did not see anybody put any whiskey in his pocket.

The appellant insists that there is no evidence whatever as to transporting, and that the court erred in refusing to direct a verdict of acquittal. There was no controversy about the city ordinance, it being agreed that it was the same as the State -statute. It is contended that the evidence is wholly insufficient to show that the appellant was transporting liquor.

We do not agree with the appellant in his statement' that the circumstantial evidence shows he might not have brought the liquor in there with him. The evidence, we think, is sufficient to justify the jury in finding that he did bring the liquor in with him. The -undisputed testimony ife that he came in the restaurant alone; that the man and his wife who kept the restaurant were there; that neither of them put the liquor in his pocket, and they did not see anybody else do this. The undisputed proof also shows that, after he ordered his cup of coffee, he went to sleep, and slept until the officers arrested him. So it appears that there was ample evidence to show that he came in there with the liquor in his pocket.

Appellant relies on the case of Wilson v. Batesville, 179 Ark. 1094, 20 S. W. (2d) 114. In the case of Wilson v. Batesville, the person charged with transporting- the liquor was in a livery barn, and the officers followed him into the barn. When they get about one-half way back in the barn, they saw the person charged with transporting reach in his shirt, pull out a pint of whiskey, and pour it out, and throw it to one side, and the officers thought that he had started out of the barn with the whiskey. The court there said: “It must be shown, inferentially at least, that the defendant was in the act of carrying the intoxicating liquor from one place or locality to another, in order to render him guilty under the statute, or under an ordinance based upon the statute.” The court also said: “In this case the marshal did not testify that appellant took the liquor into the barn, nor that he took it out of the barn. He thought he intended to take it out, but that was only a surmise. We cannot presume that he did so. All the evidence shows is that he had a pint of liquor in his possession in a livery stable, which is made unlawful by § 6169, C. & M. Digest. To transport or move liquor from one place in a room of a building, to another place in the same room, would not constitute an unlawful transportation, within the meaning of the statute. ’ ’

In the instant case, the proof shows, as stated in the Wilson case, inferentially at least, that the defendant 'had carried the intoxicating liquor into the restaurant. Where he came from is not shown, except he came from somewhere on the streets. It was not shown in the Wilson case that the person charged had had the whiskey anywhere, except in the barn. . The marshal did not testify that he went into the barn with it, or that he took it out of the barn. The witnesses in the present case testify that he came into the restaurant; stayed there something like an hour, and that no person put any whiskey in his pocket, and when the officers came he had the liquor in his pocket. He must necessarily have transported it, if the witnesses are telling the truth about it.

In the case of Fly v. Fort Smith, 165 Ark. 392, 264 S. W. 840, the facts stated by the court are as follows: “Appellant was arrested on a street car in the city of Fort Smith by one of the police officers of the city, and, after being lodged in jail, was taken into the municipal court by the officer, and the charge preferred against him of being drunk and transporting whiskey.” The court said in that case: “Appellant denied that he was intoxicated at the time he was arrested, and undertook to explain the presence of a bottle of whiskey in his pocket, by saying that he found the bottle under a seat in the street car, and put it in his pocket, and that he had no knowledge of the contents of the bottle. We think that the evidence was sufficient to warrant the jury in finding that appellant was transporting whiskey in violation of law. ’ ’ »•

We think that the above case is controlling here.

There was sufficient evidence in this case to warrant t'he jury in finding that there was an actual transporting of the liquor from place to place. The appellant did not testify, and the only evidence introduced was the evidence on the part of the city, and from that evidence the jury could very well have reached the conclusion that he transported it on the streets of Mena, because the facts testified to could not be true unless he did.

The judgment of the circuit court is affirmed.