author: Wood, J.

text:
    Davis v. Rodman.
    Opinion delivered February 14, 1921.
    1. Physicians and surgeons — negligent spread of disease. — A complaint against physicians attending plaintiff’s son, a typhoid fever patient, for negligence in failing to prevent the spread of typhoid fever to plaintiff’s other children, held insufficient for failure to allege specific facts showing that the negligence complained of was the direct and proximate cause of such children contracting the disease.
    2. Physicians and surgeons — duty to avoid spread of infectious disease. — It is the duty of physicians who are attending patients afflicted with contagious or infectious diseases not to do any negligent act that would tend to spread the infection, and to exercise reasonable care to advise members of the family and others liable to be exposed thereto of the nature of the disease and the danger of exposure.
    3. Physicians and surgeons — liability for damages. — One who, by reason of his professional relation is placed in a position where it becomes his duty to exercise ordinary care to protect others from danger is liable in damages to those who are injured by reason of his failure to exercise such care.
    4. Physicians and surgeons — duty to warn attendants. — It was the duty of a physician attending a typhoid fever patient to notify the family, nurses and attendants of the nature and character of the disease, to warn them of the danger of infection, and to instruct them as to the usual approved methods for the prevention of the spread of the disease.
    5. Physicians and surgeons — violation of rule of board of health. — An allegation that attending physicians violated a rule of the State Board of Health in negligently failing to report a case of communicable disease, without alleging that such negligence was the proximate cause of the injury of which plaintiffs complain, held insufficient.
    Physicians and surgeons — negligence—pleading.—An allegation that defendant physicians were negligent in advising plain-6. tiffs to put their son, a typhoid fever patient, among plaintiff’s other children, who subsequently became ill of the same disease, without alleging that such negligent exposure of the other children was the direct proximate cause of their illness was insufficient to- state a cause of action, especially where the complaint alleged another source of infection.
    7. Physicians and surgeons — failure to inoculate persons exposed to typhoid fever. — An allegation that defendant physicians negligently failed to inoculate the parents, their minor children, the attending nurses, and other persons exposed to typhoid fever, was insufficient both because it failed to allege that plaintiffs requested defendants to inoculate them or their children, or that plaintiffs would have consented thereto if defendants had suggested it, and because the question whether the inoculation should be resorted to is a matter solely within the judgment and discretion of the attending physicians under the circumstances of each particular case.
    Appeal from Independence Circuit Court; D. H. Coleman, Judge;
    affirmed.

      J. R. Alexander and W. K. Ruddell, for appellants.
    1. The court erred in sustaining the demurrer and dismissing the complaint, as defendants were guilty of actionable negligence. It was the duty of defendants to protect plaintiffs from injury. 29 Cyc. 419.
    2. The demurrer admits every allegation in the complaint to be true. 90 Ark. 158; 102 Id. 380; 104 Id. 466; 94 Id. 505; 94 Id. 453.
    3. Defendants failed to take the precautions required by the board of health and are liable. Rules and Regulations State Board of Health, January 1, 1918, p. 16, § 92. They negligently failed to isolate the cases of typhoid fever or securely screen against flies. Id., p. 16, § 89. The violation of a law made for the protection of persons against infection by the negligence of defendants make them liable. 15 L. R. A. (N. S.) 784-8. Assumption of risk was not available as a defense. 15 L. R. A. (N. S.) 784; 53 Ark. 201; 60 Id. 528; L. R. A. 1015 E 500 and note, p. 502.
    4. Failure to vaccinate was negligence. 30 Cyc. 1576; 21 R. C. L. 385; 81 Am. Dec. 593.

      5. Defendants liable because they failed to instruct plaintiffs. Rules and Regulations State Board of Health, January 1, 1918, p. 9, § 32 (b); 30 Cyc. 1577; 21 R. C. L. 389; 63 A. L. R. 655-61; 7 L. R. A. 566.
    6. Plaintiffs had a right to rely on defendants’ instructions. 30 Cyc. 1579; 21 R. C. L. 402; 5 A. L. R. 922, 925; 18 L. R. A. 627-31.
    7. It was negligence to allow typhoid fever patients to go to the house of plaintiffs without warning. Rules and Regulations, supra, p. 16, § 92; 19 Am. Dec. 164-6; 7 L. R. A. (N. S.) 496-9; 30 Cyc. 1577. See, also, 54 Am. Dec. 547; 5 A. L. R. 922; 93 Am. St. Rep. 834-8. Typhoid fever is highly contagious. Prac. of Med. (5 ed.) pp. 1, 26. It was actionable negligence. 58 Ark. 401; 57 Icl. 402; 122 Id. 570. It is the duty of doctors to guard against infection of diseases, and if they fail they are liable. 21 R. C. L. 389; 12 L. R. A. (N. S.) 752; cases supra; 7 L. R. A. (N. S.) 496-9.

      J. J S John B. McCaleb and S.amuel C. Knight, for appellees.
    1. We agree with appellants’ contention as to actionable negligence and their definitions, but with this qualification, that there must have been a failure on part of defendants to perform some duty imposed upon them which failure was the proocimate cause of the injury complained of. 22 R. C. L., p. 110. None of the acts or failures here alleged, which 'Occurred after appellees were called to treat the patients, was the proximate cause of the contagion. The question of vaccination was not an issue in the case, for there was allegation in the complaint that vaccination was customary and the usual mode of avoiding or preventing typhoid fever. Before an attending physician is justified in vaccinating a person, that person’s consent is necessary and no such consent or even willingness is alleged. The allegation of failure to vaccinate does not state a cause of action and could not have been properly submitted to a jury. The more modern medical authorities hold that there is a serious drawback to vaccination in typhoid fever cases. Forcheimer’s Practice of Medicine; Sajou’s Enc. of Medicine. Appellees had a perfect right to choose their course of treatment, whichever they perferred. 21 R. C. L. 383.
    2. Failure to notify the county health officer was not actionable negligence. 21 L. R. A. (N. S.) 115.
    3. Allowing Lawson Davis to be moved to the residence of appellants. The contention of appellants is without merit, and the cases cited are not in point. 19 Am. Dec. 164-6; 7 L. R. A. (N. S.) 496-9.
    4. Failure to instruct plaintiffs' as to the treatment and prevention of typhoid fever is not negligence. Act 96, Acts 1913, § 6; lb., % 29, Acts 1911. 'Courts and parties must take notice of the rules, acts and regulations of the duly constituted health boards, commissions, etc.' 130 Ark. 453; 26 Id. 260; 90 Id. 343.
    5. As to the excreta and other bodily secretions, the contentions of appellants are without merit. The rules and regulations pleaded by appellants give ample information for the care and disposition of such. 130 Ark. 453; 26 Id. 260; 90 Id. 343.
    The complaint does not state a cause of action and the court properly sustained the demurrer.
   Wood, J.

This action was brought by appellants against the appellees to recover damages. The appellants alleged in substance that the appellees were regularly licensed and practicing physicians associated together as partners and doing a general practice of medicine at Newark and vicinity in Independence County, Arkansas: that appellants were man and wife, having a family of six minor children, and two adult married sons, who lived in their own homes apart from the appellants; that one of these sons, Curtis Davis, on June 15, 1919, was stricken with typhoid fever; that their son Lawson nursed him and was also, on July 15, 1919, stricken .with typhoid fever; that the appellees were the attending physicians, and as such they negligently and wilfully failed to notify the county health officer that typhoid fever was at the residence of Curtis and Lawson Davis; that they failed to post notices in front and at the rear of the residences of Curtis and Lawson Davis and failed to instruct the patients and their attendants, appellants, and other nurses in all the necessary sanitary measures for them to observe in order to prevent the spread of the disease; that they failed to vaccinate the appellants, and other nurses, attendants, and all other persons who had been exposed to the disease; that they failed to isolate the patients in a room to themselves and to screen the room from flies; that they failed to have buried or disinfected the secretions and excretions from the body of the patients and failed to instruct the attendants to carry out and execute all the rules and regulations of the board of health pertaining to and necessary to prevent the spread of typhoid germs, which it was their duty to do, and ignored all precautions and sanitary measures'necessary to prevent the spread of the disease, which was contagious; that appellees advised the appellants to move the patients from their own homes to the homes of appellants, which appellants did; that the appellees failed to notify the appellants that typhoid fever was a contagious disease and failed to take the precautions above set forth to prevent the spread of the disease; that as a result of appellees’ negligence as above set forth, appellant, N. A. Davis, on the 12th day of October, 1919, became infected with typhoid germs, from which she suffered great physical pain and mental anguish resulting in permanent injury to her health, all of which, together with the sums she was compelled to expend for nursing, medicine and doctors’ bills, damaged her in the sum of $3,000; that the minor sons, Paul and Dallas Davis, as a result of the negligence above set forth, also contracted typhoid fever on the 15th day of October, 1919, to the appellants’ damage, items of which were specified, in the sum of $3,000; that Walker Davis, another minor son, on October 15, 1919, from the same cause, contracted the disease and thereafter died, to appellants ’ damage, which they specified, in the sum of $3,000; that appellant J. L. Davis, also by reason of the negligence of appellees as above set forth, contracted the disease, from which he suffered physical pain and mental anguish, which rendered him unable to perform his regular work, impaired his health permanently, decreased his earning power and compelled him to incur debts for medicine, nursing and doctors’ bills, all to his damage in the sum of $3,000. The complaint concludes with a prayer for judgment in the sum of $3,000. The appellees entered a general demurrer to the complaint. The court entered judgment sustaining the demurrer and dismissing the complaint, and for costs in favor of the appellees, from which judgment is this appeal.

1. Typhoid fever is an infectious febrile disease caused by a micro-organism called bacillus typhosus, introduced into the system by the fingers, or with the food or drinking water. Osier’s Principles and Practice of Medicine, 1-5; Forcheimer’s Therapeusis of Internal Diseases, vol. 5, p. 203; (Webster’s Dictionary; New International Dictionary — Typhoid Fever). It is declared by the State Board of Public Health to be “contagious, infectious, and communicable.” Rules and Regulations of the State Board of Health, p. 5, § 11..

A' contagious disease is one communicable by contact with a patient suffering from it, or with some secretions or object touched by such a patient. (Webster “Contagious.”) “Fingers, food, water and flies are the chief means of propagation.” .Osier’s Principles and Practice of Medicine, 5.

Keeping in mind these definitions of. infectious and contagious diseases, and their means-of propagation, we have reached the conclusion that the allegations of the complaint do not state facts sufficient to show that any of the acts of negligence alleged were the proximate cause of the typhoid fever contracted by the appellants and their children. It is not alleged -in the complaint that typhoid fever is an infectious disease. While there is an allegation to the effect that the appellees “failed to have buried or disinfected the secretions and excretions from the bodies of the patients,” there is no allegation to the effect that such failure caused the typhoid germs to get into the food or water used by appellants and their children, or in any other manner to be introduced through the mouth into the intestines of the victims of the disease. Moreover, there is no duty imposed upon physicians by statute to personally bury, or disinfect, the secretions or excretions of their typhoid fever patients.

The State Board of Health requires that “no person in charge of a typhoid fever patient shall so dispose of the excreta or other infectious bodily secretions or excretions as to cause offense or danger to any person or persons.” R. & R. of State Board of Health, 1918, p. 16, § 89.

If it be conceded that this section makes it the duty of physicians to instruct those in immediate charge of a patient to dispose of the excretions and secretions in the above manner, still there are no allegations of fact which show that the failure to discharge that duty was the proximate cause of the communication of the disease to appellants and their children. In other words, it is not alleged that the failure of the physician to instruct the nurses or attendants in charge of the patient caused such nurses or attendants to dispose of the excretions and secretions, so that the water which appellants and their children drank, and the food they ate,, became infected thereby with the typhoid bacillus.

It is undoubtedly the duty of physicians who are attending patients afflicted with contagious or infectious diseases not to negligently do any act that would tend to spread the infection. It would likewise be their duty to exercise reasonable care to advise members of the family and others, who are liable to be exposed thereto, of the nature of the disease and the danger of exposure. The relation of a physician to his patient and the immediate family is one of the highest trust. On account of his scientific knowledge and his peculiar relation, an attending physician is, in a certain sense, in custody of a patient afflicted with infections or contagious disease. And he owes a duty to those who are ignorant of such disease, and who by reason of family ties, or otherwise, are liable to be brought in contact with the patient, to instruct and advise them as to the character of the disease.

It is a sound rule of law that one wlm by reason of his professional relation is placed in a position where it becomes his duty to exercise ordinary care to protect others from injury or danger, is liable in damages to those who are injured by reason of his failure to exercise such care. Skillings v. Allen, 5 A. L. R., p. 922 and note. It was, therefore, the duty of the appellees, when called to attend the children of appellants, to notify the latter, other nurses and attendants, of the nature and character of the disease, to warn them of the danger of infection, and to instruct them as to the usual methods approved by the profession, of which they have knowledge, for the prevention and spread of the disease. This duty was incumbent upon the appellees, regardless of the rules and regulations of the State Board of Health on the subject. 30 Cyc. p. 1577; 21 R. C- L., § 33, p. 389. But it was not the duty of appellees as physicians to enforce the rules of the State Board of Health for the prevention of typhoid fever. That was the duty of local health officers. R. & R. of State Board of Health, p. 16, R. 90.

It is alleged in the complaint that “appellees negligently failed to instruct said patients, their attendants, the plaintiffs, and other nurses that the patients had typhoid fever, a contagious disease, or as to what were necessary sanitary precautions for them to observe and practice to prevent the spread of said disease.” There is no allegation of fact to show that the alleged negligence of the appellees in the respects named caused appellants’ children to contract the disease. The general allegations that “appellees encouraged people1 to come in contact with their patients,” and that grossly negligent acts of defendants conduced to infect plaintiffs and their families with typhoid fever germs,” are not sufficient. There is no allegation that if the warning and instructions had been given appellants could and would have heeded and obeyed them. Specific acts and facts showing how and why the alleged negligence of appellees was the proximate cause of the injury of which the appellants complain, were necessary to be stated. These can not be supplied by intendment.

2. One of the rules of the State Board of Health requires “every physician to report, as soon as possible, every case of communicable disease, declared notifiable, which occurs in his practice, to the local city and county health officer having jurisdiction.” Typhoid fever is such a disease. It is made a misdemeanor for any person to violate this rule. R. & R. State Board of Health 1918, p. 6, rule 12; Act 96, p. 360 of Acts 1913.

It is alleged that the appellees negligently failed to comply with this rule. But again there is no allegation of specific acts or facts showing that the failure of ap.pellees to perform this statutory duty was the proximate cause of the injury to appellants. There is no allegation that, if appellees had complied with this rule, appellants and their children would have escaped typhoid fever. Violation of the rule was evidence of negligence. Bain v. Fort Smith L. & T. Co., 116 Ark. 125; Pankey v. Little Rock Ry. & Elec. Co., 117 Ark. 337-44. But such violation was not actionable negligence creating civil liability unless it was the proximate cause of the injury to appellants. The necessary facts and acts to show this are not alleged.

3. Appellees were negligent in advising appellants to move their son, Lawson Davis, from his residence to appellants’ residence, and telling them that they could put him among the other children where he could see his little brothers and sisters. Skillings v. Allen, supra; Hewett v. Woman’s Hospital Aid Assn., 73 N. H. 556, 7 L. R. A. (N. S.) 496-99. Assuming this allegation to be true, which we must on demurrer, such instructions coming from attending physicians without warning of the danger of infection to the other children of the appellants, were acts of gross- negligence. Bnt here again specific acts and facts are not alleged which show how or why this advice and these instructions caused the injury to appellants. On the contrary, it is alleged that typhoid fever was a contagious disease, and that the appellants had nursed their son, Curtis Davis, before he was removed to the residence of the appellants; and other allegations show that appellants were in attendance upon him before the appellees were called to his ■bedside. Now, “the period of incubation for typhoid germs lasts from eight to fourteen days,, sometimes twenty-three.” Osler, P. & P. Med. 14. An allegation further shows that one of the appellants, N. A. Davis, was infected with typhoid germs on the 12th day of October, 1919, three days before any of the minor children of appellants became infected with the disease. According to this allegation, the minor children were affected on the 15th day of October, 1919. Therefore, according to the allegations of the complaint, the appellants may have contracted the disease before either of their adult sons were moved to the residence of appellants, and the minor children may have contracted the disease from their mother, rather than from their elder brother. For she had voluntarily exposed herself and had come down with the fever before the minor sons were attacked.

To fix civil liability, for so serious a delinquency as that set forth in the complaint, it was necessary to allege specific acts and facts showing that the injury to appellants was caused directly and approximately by such delinquency. Here the allegations show that appellants may have contracted the disease before appellees advised appellants to move their adult son, and the minor sons may have contracted the disease from their mother, rather than from their brother. Therefore, the source of infection of the minor children is not definitely traced to any act of negligence of appellees. The allegations on this vital subject are not sufficient to state a cause of action.

4. It is alleged that the appellees negligently failed to vaccinate the appellants, their minor children, attending nurses and other persons who had been exposed to the disease. The term “vaccinate” is here loosely used by the pleader for “ inoculate. ’ ’ In the first place, the appellees could not inoculate the appellants, or their minor children, without appellants’’ consent. It is not alleged that appellants requested appellees to “vaccinate” them or their children, or that appellants would have consented thereto if appellees had suggested it. In the second place, in the absence of a statute requiring it, whether inoculation shall be resorted to as a means for preventing the spread of contagious or infectious diseases is a matter addressed solely to the independent judgment and discretion of the attending physician. It can not be said that the efficacy of inoculation of a specific vaccine to prevent the spread of typhoid fever has been so thoroughly established 'by medical science as to make it the absolute duty of physicians to inoculate nurses, attendants and persons exposed during an epidemic of that disease.’

The medical authorities cited in the briefs of learned counsel for the respective parties to this litigation show that doctors themselves differ as to whether inoculation would furnish complete immunization against typhoid fever. Although the majority of eminent medical authorities now advocate inoculation as a preventive of typhoid fever, yet, until it has been demonstrated beyond doubt that inoculation affords complete immunization against the disease, it must be left to the judgment and discretion of the physician, under the circumstances of each particular case, to determine whether inoculation is necessary. Tyson’s Practice of Medicine (5 ed.), p. 126; 2 Forcheimer’s Practice of Medicine; Sajous’ Ency. of Medicine; Osier, P. & P. of Med. 41; 5 Forcheiiner’s Therapeusis of Internal Diseases, 201. Matters of this kind require scientific investigation and expert knowledge to determine. It can not be left to a jury to say whether the expert in the practice of his profession has pursued the proper course.

The judgment is correct, and it is therefore affirmed.


source: Caselaw Access Project

author: Hart, J.

license: Public Domain

text:
    Cole v. Bloyed (two cases).
    Opinion delivered February 14, 1921.
    Corporations — insolvent corporation — preference.—Under Crawford & Moses’ Digest, § 1800, preferences obtained against an insolvent corporation by attachment can not be set aside in chancery “unless complaint thereof be made within ninety days after the same is given or sought to be obtained.”
    Appeal from Marion Chancery Court; Ben F. Mc-Mahan, Chancellor; and Marion Circuit Court; J. M. Shinn, Judge;
    affirmed.
    statement oe eacts.
    On the 3d day of October, 1919, J. M. Bloyed filed a suit in attachment against the Bankers Mining Company, and as ground therefor alleged that said company was indebted to him on a promissory note in the sum of $2,002.50, and was a foreign corporation. ■ An attachment was duly issued and levied by the sheriff upon the property of the Bankers Mining Company on the 7th day of October, 1919. On the 30th day of January, 1920, the circuit court sustained the attachment and ordered a sale of the property to pay Bloyed’s debt. Pursuant to the orders of .the court, the property was sold by the sheriff on the 20th day of March, 1920, at public sale after being duly advertised. On March 11, 1920, Charles Cole filed a proceeding in the chancery court to wind up the affairs of the Bankers Mining Company as an insolvent corporation and asked that his claim for services in taking care of the mine be allowed under the statute as a preferred claim. On the 27th day of April, 1920, Charles Cole filed an amendment to his original complaint in which he asks that J. M. Bloyed and the sheriff of the county, who had seized the property of the corporation under the attachment proceedings above referred to, should be made parties. ■
    Bloyed and the sheriff entered their appearance in the chancery court and filed a demurrer. The chancellor sustained the demurrer, and, the plaintiff having declined to plead further, his complaint was dismissed, in so far as it affects the sheriff and J. M. Bloyed, for want of ■equity.
    The decree was entered of record on April 29, 1920, and Charles Cole has duly prosecuted an appeal to this court. After this decree was rendered, Cole filed an intervention in the attachment case in the circuit court, and set up the facts above recited.
    The circuit court denied him relief, and from that judgment he has also prosecuted an appeal to this court.

      AUyn Smith, for appellant.
    1. In the chancery case the court erred in sustaining the demurrer and in holding that court had no jurisdiction. In the law case the court erred in overruling the demurrer of intervener to the plea in bar and holding that the chancery proceedings was a bar to intervener’s petition in the law case.
    Both the sheriff and Bloyed were proper parties. 84 S. W. 1040 (Col. 2); 74 Ark. 93. The lien is claimed under Kirby’s Digest, § 5359, giving a lien on the output, machinery, tools, etc., in any mine in this State. Statutes giving liens to laborers, etc., should be liberally construed. 104 U. S. 176-9; 94 Id. 545. A watchman and caretaker are entitled to the probation of the statute. 21 Pac. 413-415; 12 Pac. 433; 104 IT. S. 176. The statutes of various States are substantially the same as ours, and their construction is strongly advisory .and persuasive, and, if followed (21 Pac. 413)-, is decisive of the claim of plaintiff for a lien as caretaker and custodian. Plaintiff was in possession of the property when seized by the sheriff, and if he had not a statutory lien, yet as a bailee he had the right to retain possession until his lien was satisfied. 36 Ark. 276; 94 Kan. 38, 41-2.
    The attachment did not displace nor supersede tne lien of plaintiff. 15 Ark. 343-4; 58 Id. 252; 24 S. W. 496. Neither the attaching creditor nor the purchaser takes any greater interest than the debtor himself had. 24 S. W. 499.
    The statute vests in the chancery court jurisdiction of the estate of insolvent corporations and may be instituted by any creditor. Kirby’s Digest, § 950. Section 949 gives preference to wages of laborers and employees and the only limitation on the power of the chancery court is that complaint must be made within ninety days. Kirby’s Digest, § 951. This would include an attachment, but such attachment would not displace the lien of the plaintiff, the laborer. 58 Ark. 252.
    The lien of plaintiff was enforcible in equity. 101 111. App. 13; 176 111. 107; 68 Am. St. 290; 182 Ala. 291; Ann. Cas. 1915, 758.
    Where one has a lien on property which is taken, and said property wrongfully converted by another with notice of such lien, the lien attaches to the proceeds of the property. 36 Ark. 575; 72 Id. 132; 92 Id. 248; 126 Id. 281. Wherever a lien is to be enforced, the right of the parties to resort to equity is unquestioned. 33 Ark. -233; 38 Id. 387. Equity has jurisdiction to determine the priority of liens between creditors (59 Miss. 327; 53 Ark. 140; 47 Id. 41), and will always enforce a lien or declare priorities. 92 Ark. 248; 72 Id. 132. See, also, 72 Ark. 132; 36 Id. 575.
    Whatever may have been the rule prior to act April 14, 1883 949-52, Kirby’s Digsest), see 52 Ark. 426; 12 S. W. 876. The chancery court is expressly given jurisdiction by this statute, in a suit by a creditor to declare priority of all the claims of creditors against the corporation, and the court erred in sustaining the demurrer of Bloyed and Flippin to the complaint.

      2. Under §§ 949-52, Kirby’s Digest, any creditor has the right to institute proceedings to wind up the affairs of an insolvent corporation and distribute its assets and the filing of the complaint vested in the chancery court exclusive jurisdiction over the estate of the Bankers Mining Company, and Bloyed and Flippin, or any other person who had assets of the insolvent corporation or claimed to be a creditor, were proper parties, and when chancery took jurisdiction for any purpose it took for all purposes. 14 Ark. 50; 30 Id. 278; 114 Id. 206. Its receiver became custodian for all purposes of all the assets of the insolvent corporation. Cole was a creditor and had a lien, and there is no conflict of jurisdiction between the equity court and the law court. The jurisdiction is well defined, and both subject to the same Supreme Court. A conflict of jurisdiction is not possible. 56 Ala. 138-143; 91 Pac. 276. If our construction of Kirby’s Digest, §§ 949, 952, is correct, then the action of the chancery court in declining to direct its receiver to take the custody and control of the assets of the Bankers Mining Company and in dismissing Bloyed and the sheriff from the case was erroneous. The complaint stated a cause of action, and it was error to decline to take jurisdiction and in sustaining the demurrer of Bloyed and the sheriff.
    If the complaint in the chancery case did state a cause of action within its jurisdiction, the ruling of chancellor was erroneous; if it did not,, then the proceeding was not a bar, and the ruling in the law ease was error and must be reversed.

      ■Williams & Beawell, for appellee.
    1. The rights of the parties to this litigation were detemined by the decree of the chancery court. The same facts were pleaded as those set up in the intervention in the circuit court. If the complaint in chancery court stated a cause of action against the sheriff or Bloyed, appellant shóuld have moved to transfer to the law court. When appellant refused to plead further and the court dismissed his complaint, his rights were adjudicated and there was error; his remedy was by appeal. He can not abandon his equity case and proceed in another court. 63 Ark. 254; 99 Id. 433. The plea of former adjudication was properly sustained.
    2. Appellant had no lien on the property of the insolvent corporation, under Kirby’s Digest, §§ 949-952. This statute does not displace liens on property of-insolvent corporations, but the receiver takes the property subject to all valid liens at the time of his appointment. 97 Ark. 534.
    Bloyed’s attachment was a lien from the date of its levy, October 7, 1919. C. & M. Digest, § 512. After the expiration of ninety days the lien of the attachment became fixed absolutely, and it was not within the power of the chancery court to vacate it or set it aside. 67 Ark. 11; 109 Id. 584; 114 Id. 26. .
    3. Appellant did not have a lien by virtue of § 5393, Kirby’s Digest. 50 Ark. 244; 54 Id. 522; 69 Id. 23; 71 Id. 334. The decree of the chancery court was an adjudication of all appellant’s rights and is in accordance with law.
   Hart, J.

(after stating the facts). Cole seeks his relief under sections 1798 to 1800 inclusive of Crawford & Moses’ Digest. He was the caretaker at the mine of the Bankers Mining Company, and that company owed him for his services.

Section 1798 of- the digest referred to provides that no preferences shall be allowed among creditors of insolvent corporations except for the wages of the laborers and employees.

Section 1799 provides that the procedure for winding up insolvent corporations shall be in the chancery court.

Section 1800 reads as follows: ‘‘Every preference obtained or sought to be obtained by any creditor of such corporation, whether by attachment, confession of judgment or otherwise, and every preference sought to be given by such corporation to any of its creditors, in contemplation of insolvency, shall be set aside by the chaneery court, and such creditor shall be required to relinquish his preference and accept his pro rata share in the distribution of the assets of such corporation; provided, no such preference shall be set aside unless complaint thereof be made within ninety days after the same is given or sought to be obtained.”

Cole waited too late to file his proceedings in the chancery court to wind up the affairs of the Bankers Mining Company as an insolvent corporation, to obtain a preference under the statute.

The section just quoted provides that every preference obtained by attachment or otherwise shall be set aside by the chancery court; provided, that no such preference shall be get aside unless complaint thereof be made within ninety days after the same is given or sought to be obtained. Cole did not comply with the statute. The preference by attachment was completed by a levy on the property of the corporation under the attachment proceedings on the 7th day of October, 1919. Cole did not file his complaint in the chancery court until March 11, 1920. This was longer than the ninety days given him under the statute, and he was barred of his relief. The decree of the chancellor was correct and must be affirmed.

After the decree against him in the chancery court was rendered, Cole filed an intervention in the attachment suit in the circuit court and set up the same state of facts as was shown in the chancery court. The circuit court correctly denied him relief there. The very identical question he sought to have adjudicated in the circuit court had already been adjudicated in the chancery court. Therefore, the judgment in the circuit court must also be affirmed.


text:
    Randle v. Interstate Grocer Company.
    Opinion delivered February 14, 1921.
    1. Contracts — violation op blue sky law. — Under Crawford & Moses’ Digest, §§ 751, 762, 770, making it unlawful for any investment company to sell stocks, bonds or other securities without procuring the Bank Commissioner’s approval, and making a violation of the act a misdemeanor, notes given in pursuance of a sale of securities made without the commissioner’s approval are void, and can not be validated by a subsequent compliance with the statute.
    2. State — police power. — Under its police power, the State may regulate certain occupations and the terms on which stocks and other securities may be sold.
    3. Appeal and error — dismissal on reversal. — Where a case has been fully developed, it will be dismissed on reversing it.
    Appeal from Marion Circuit Court; J. M. Shinn, Judge;
    reversed.
    STATEMENT OF FACTS.
    The Interstate Grocer- Company sued J. M. Randle in tbe circuit court to recover an amount alleged to be due it upon three promissory notes. Tbe plaintiff was a foreign corporation and bad not complied with our statutes in regard to tbe sale of corporate stock by investment companies. Tbe notes in question were given for shares of stock in tbe plaintiff company. At a later date tbe plaintiff complied with tbe statute and. secured a certificate authorizing it to sell six hundred shares of its capital stock. It then instituted tbe present suit.
    Tbe case was tried before tbe court sitting as a jury and judgment was rendered in favor of tbe plaintiff against tbe defendant for tbe amount sued for. Tbe defendant has appealed.

      Willimns & Seawell, for appellant.
    A foreign corporation can not legally sell is capital stock in this State until after it has complied with tbe blue sky law and secured from the 'State Bank Commissioner a certificate authorizing such a sale. Act No, 242, Aots 1915, §■§ 2, 21. The contract and notes are void. 2 Pet. 527; 91 Ark. 69-72; 145 Ark. 61. -

      J. H. Black, for appellee.
    The only question -here is settled. See 183 S. "W. 741; 70 Ark. 525; 77 Id. 203.
   Hart, J.

(after stating the facts). It is contended by counsel for the defendant that the judgment against him should be reversed because the contract in question was made unlawful by sections 751 and 762 of Crawford & Moses’ Digest.

Section 751 provides, among other things, that every person, corporation, copartnership, company or association, a resident of, or organized in, any other State', shall be known for the purposes of this act as a foreign investment company.

Section 762 provides, among other things, that it shall be unlawful for any investment company, or dealer, or representative, either directly or indirectly, to sell or cause to be sold, offer for. sale, take subscription for, or negotiate for the sale in any manner in this State, any contracts, stocks, bonds, or other securities (except as expressly exempt herein) unless and until said bank commissioner has given his approval in accordance with the act.

Section 770 of the digest malíes it a misdemeanor to violate the provisions of the act and imposes a fine of not more than $1,000, or imprisonment in the county jail for not more than a year, or by both such fine and imprisonment.

It is sought to uphold the judgment upon the authority of our holding that the failure of a foreign corporation to comply with the requirements of the statute prescribing conditions upon which foreign corporations may enter and do business within the State do not render its contracts void, but only prevents their enforcement by such corporations until compliance with the terms of the statute. Waxahachie Medicine Co. v. Daly, 122 Ark. 451, and Buffalo Zinc & Copper Co. v. Crump, 70 Ark. 525.

We do not think that these cases control here. It was within the power of the State to prescribe terms and conditions upon which foreign corporations might do business in this State. The statute under consideration in the cases referred to were dealing .with the rights of such corporations to do business in the State at all, and did not malee unlawful the business itself.

In the last mentioned case the court said: ‘ ‘ The act of February 16 does not expressly prohibit the institution of an action because of a failure to perform any condition, nor does it intend to forever prohibit the maintenance of any action because the plaintiff therein is a foreign corporation, and has not within any particular time complied with its terms. Penalties are imposed on account of past conduct or omissions. The penalties of the act in question are, doubtless, intended to compel an observance of its terms. When that is done, its purpose is accomplished, the condition upon which the right to mtaintain an action depends is performed, and 'the plaintiff can in the future prosecute it to a final judgment.” The same principle enters into the decision of the first mentioned case.

The present case is distinguishable in principle from these cases. It expressly makes it unlawful for every person, corporation, copartnership, or association of any other State to sell stocks, bonds, or other securities in this State unless and until the bank commissioner has given his approval in the manner provided by the act. A subsequent section makes the violation of the act a misdemeanor. Thus it will be seen that it was the intention of the lawmakers, as expressed by the language of the act, to make unlawful, contracts like the one in question, unless the permission to make them was given in accordance with the statute. It is directed against the kind of business to be conducted and is not directed against the persons carrying on the business. This is shown by the fact that it is equally unlawful for persons or copartnerships to carry on such business without the required permission as it is for corporations to do so. The statute is not directed, at the person or corporation doing .the act, but at the act done by them. It is intended to regulate the business. Therefore, we are of the opinion that the case is ruled by the principles of law laid "down in the case of Compagionette v. McArmick, 91 Ark. 69. In that case, suit was brought upon a note given for the purchase of a horse known to the seller to have the glanders, and the contract was held void. The statute in that casé provided, in effect, that any person who shall sell any horse having the disease known as the glanders should be guilty of a misdemeanor. In discussing the question the court said:

“A sale is illegal where the statute expressly declares it to be so, or where it prohibits its execution; and a sale is equally invalid where the statute only imposes a penalty upon the party for making it. It is not necessary that the statute should expressly declare the contract of sale to be void; but the infliction of a penalty upon what is declared as an offense implies a prohibition of such act, and thereby renders void any contract founded on such act. In this State it is the well settled doctrine that, ‘ every contract made for or about any matter or thing which is prohibited and made unlawful by statute is a void. ’ ’ ’

So here, the statute makes it unlawful for a person, firm or corporation of another State to come into this State and sell stocks without obtaining permission from the Bank Commissioner in accordance with the statute. The plaintiff sold the stock without complying with the statute and thereby rendered the contract void.

Under our bill of rights, all are created equally free and have certain inherent and inalienable rights. It has been well said that the right to follow any of the common occupations of life is an inalienable right. It is equally well settled that the State, under its police power, may regulate certain occupations, and that statutes regulating the terms on which stocks and other securities may be sold in a State are generally held valid. Standard Home Co. v. Davis, 217 Fed. Rep. 904, and Ex parte Taylor, (Fla.) Ann. Cas. 1916 A, p. 701 and case note.

It follows that the judgment must he reversed, and, inasmuch as the case has been fully developed, the cause of action will be dismissed.

Smith, J., dissents.


text:
    State v. St. Louis Cotton Compress Company.
    Opinion delivered February 14, 1921.
    Insurance — tax on premiums paid. — Crawford & Moses’ Dig., § 9967, requiring persons, firms or corporations doing business in Arkansas to pay into the treasury a tax of 5 per centum of the gross insurance premiums paid by them on their property in the State to persons or corporations not authorized to do business in this State, is valid in its application to foreign corporations; being referable to the State’s power to prescribe the conditions on which such corporations may do business in the State.
    Appeal from Pulaski Circuit Court; A. F. House, Judge;
    reversed.
    STATEMENT OE EAOTS.
    Appellant instituted this action in the circuit court against appellee to recover taxes alleged to he due by it to the State of Arkansas on premiums paid for insurance from corporations not authorized to do business in this State.
    Appellee is a foreign corporation authorized to do business in this State and operates compress plants in several cities in the State of Arkansas. It owns real estate, warehouses, and compresses at each of the towns in which it does business. Appellee is a corporation organized under the laws of the State of Missouri and in that State entered into contracts of fire insurance with companies not authorized to do business in this State for the insurance of all its property situated in this State. It refused to pay the tax on gross premiums so paid as required by our statute. Hence this lawsuit.

      The circuit court rendered judgment in favor of appellees and the case is here on appeal,

      John D. Arbuckle, Attorney General, and F. G. Lindsey, for appellants.
    The court erred in overruling plaintiffs’- demurrer and dismissing the complaint. Act 159, § 1, Act 1913, p. 676. The statute is mandatory. It is admitted that defendant is a corporation doing business in this State and took out contracts of insurance without complying with our laws and is liable for the tax. Act 1913, p. 676; act 264, § 1, p. 1362; Acts 1917.

      Rose, Hemingway, Cantrell & Loughborough, for appellee.
    The question presented has been settled by decisions of our United States Supreme Court. 165 U. S. 578, 587-9-90; 234 U. S. 149; 239 Id. 103; 246 Id. 357-373. See, also, 140 Ark. 133.
   Hart, J.

(after stating the facts). Section 9967 of Crawford & Moses’ Digest requires fire and other insurance companies authorized to do business in this State, to pay a tax of two per cent per annum on their grogs receipts after deducting return premiums and authorized reinsurance. This suit is based upon the provision of the act which, among other things, provides: ‘ ‘ That any person, firm or corporation, individual or association doing business in this State securing indemnity contracts or policy of insurance from any person, firm, corporation, association or individual not authorized to do business in this State shall, on or before the first day of March, each year, file with the Auditor of State a sworn affidavit of the amount of premiums paid to such unauthorized persons, firms, associations or corporations, and shall pay into the State treasury a tax of 5 per centum of the gross premiums paid.”

It is sought to uphold the decision of the circuit court on the ground that the act is unconstitutional, and to support their contention counsel rely upon the cases of Allgeyer v. Louisiana, 165 U. S. 578; N. Y. Life Insurance Co. v. Head, 234 U. S. 149; Provident Savings Life Assurance Society v. Commonwealth of Kentucky, 239 U. S. 103, and New York Life Ins. Co. v. Dodge, 246 U. S. 357.

In New York Life Ins. Co. v. Head, supra, a resident of New Mexico, while in the State of Missouri, borrowed from a New York life insurance company, a foreign corporation, on a policy issued to him a sum of money and subsequently defaulted in the payment of the interest on the loan and the premium on the insurance policy. The company settled under the terms of the loan agreement and the laws of the State of New York: The beneficiary sued the company for the full amount of the policy, basing her right to relief under a statute of Missouri regulating loans on policies of life insurance by the company issuing the policy. The Supreme Court of the United States held that a State may not extend the operation of its statutes beyond its borders into the jurisdiction of other States so as to destroy and impair the rights of persons not its citizens to make a contract not operative within its jurisdiction and lawful in the State where made.

In Provident Savings Life Assurance Society v. Commonwealth of Kentucky, 239 U. S. 103, a suit was brought by the State against the insurance company to recover a tax on premium receipts under the State statute. The company ceased to write insurance in the State, but continued to collect premiums on business already written but refused to pay the tax on the premiums. The court said that the continuance of insurance contracts on the lives of residents of the State already written by the company does not depend upon the consent of the State; nor has the State tlie power to treat the mere continuance of the obligation of existing policies of insurance held by residents as the transaction of local business justifying the imposition of a privilege tax in the absence of actual conduct of business within the limits of the State. Therefore, the court held that the imposition of taxes on premiums collected on policies on residents of Kentucky in pursuance of the statutes of that State after the company had ceased to do business therein, to be an unconstitutional exercise of power under the due process provision of the Fourteenth Amendment.

In New York Life Ins. Co. v. Dodge, 246 U. S. 357, the court held that a statute of the State of Missouri governing a life insurance contract made locally between a resident citizen and a locally licensed foreign corporation, and prescribing how the net value of the policy should be applied to avoid forfeiture if the premium was not paid, could not be extended so as to prevent the policy holder, while present in such State, and the company from making and carrying out a subsequent independent agreement in the company’s home State, pursuant to its laws, whereby the policy is pledged as security for a loan and afterward canceled in satisfaction of the indebtedness. The decision was placed upon the ground that to so hold would be an invasion of the citizen’s liberty of contract under the Fourteenth Amendment and could not be sustained.

These cases would be applicable to the present case if the statute had required the tax in question to be paid by the foreign insurance company. No such attempt is made by the statute, and we do not regard the cases as controlling under the facts as disclosed by the record.

In Allgeyer v. Louisiana, 165 U. S. 578, a citizen and resident of Louisiana made in New York, with a corporation doing business there, a contract for marine insurance to cover cotton to be purchased and shipped. All-geyer mailed in Louisiana a letter addressed to New York City, reporting the shipments as required by the contract. Under the Louisiana statutue it was a crime for any one to do any act'-to effect insurance in any marine insurance company which had not established a place of business within the State and appointed an agent upon whom process might be served. The insurance company had not been aqthorized to do business in Louisiana and did no business there. Allgeyer was convicted of mailing the letter, and the Supreme Court of the United States held that the statute was unconstitutional as construed by the State court because it denied to citizens of the United States rights guaranteed by the Fourteenth Amendment.

We do not think that case furnishes any support to the contention of counsel for appellee. The court said that the statute in question was not due process of law because it prohibited an act which, under the Federal Constitution, Allgeyer had a right to perform. The court further said, however, that this did not interfere in any way with the acknowledged right of the State to enact such legislation in the legitimate exercise of its police power as it may seem proper. No attempt is made under the present statute to interfere with the freedom of contract between the appellee and foreign insurance companies which are not carrying on business in this State. Appellee had a perfect right to make the contract of insurance without the State of Arkansas. Its right to do so is not affected or questioned by this decision. The question presented for our determination is whether or not the statute requiring persons, firms, or corporations doing business in this State to pay into the State treasury a tax of 5 per cent, of the gross premiums paid by it to corporations or associations not authorized to do business in this State, for policies of insurance on its property in this State, is a valid one. Appellee is a foreign corporation, and in any event the statute is valid insofar as it is concerned. The Legislature has complete control over corporations and can create them or permit them to do business in this State upon .such terms as it deems proper. The Legislature had the power to prescribe terms upon which foreign corporations might do business in this State as well as domestic corporations which it 'brings into existence, and therefore • had the power to lay this imposition upon appellee as an occupation tax. State ex rel. v. N. Y. Life Ins. Co., 119 Ark. 314.

The judgment of the circuit court holding the statute unconstitutional was wrong. Therefore the judgment must be reversed, and the cause will be remanded for further proceedings according to law.


author: Smith, J.

text:
    Denton v. Berryville Auto Service Company.
    Opinion delivered February 14, 1921.
    1. Liens — innocent purchaser. — In an action by an anto repair company to enforce a lien on a car for supplies and repairs, under General Acts 1919, p. 123, evidence held to establish that defendant claiming to have purchased the car was not an innocent purchaser thereof.
    2. Estoppel to deny ownership. — Where the owner of an automobile suffered plaintiff, an auto repair company, to extend credit to a third person in possession of the car for accessories to and repairs on the car, upon the assumption that the supplies and repairs would be secured by a lien on the car, under General Acts 1919, p. 123, the owner was estopped to deny the third person’s ownership, so far as the lien is concerned.
    Appeal from Carroll Chancery Court, Eastern District; BenF. McMahan, Chancellor;
    affirmed.

      Johnson & Simpson, for appellant.
    The chancellor erred in declaring a lien in favor of appellees on either of the automobiles in controversy. The evidence fully sustains appellant in his contention that no work or labor was ever done on either of the automobiles by appellees or that appellees by their work or labor ever at any time placed or put any repairs, appliances or accessories on either car, and the clear preponderance of the evidence is that appellant had no knowledge of Cole’s indebtedness to appellees. The evidence was insufficient under act No. 140, Acts 1919, § 1, to authorize a judgment in this case. Appellees had no lien under the act or any other act, and the judgment is against the clear preponderance of the evidence. The lien given by the act can not take precedence over a tona, fide purchaser of the vehicle.

      Andrew J. Russell, for appellees.
    The act No. 140, Acts 1919, authorizes a suit of this nature and gives a lien for 'all accessories furnished and the evidence sustains the decree. Denton certainly knew what Cole was doing and is bound. Section 1 of the act dissipates appellant’s theory, and the evidence sustains the chancellor’s findings.
   Smith, J.

This is an appeal from a decree of the court below rendering judgment against Hugh Cole for certain automobile supplies and repairs and declaring a lien for the amount thereof on two automobiles now claimed by W. D. Denton. Denton alone has appealed.

The account sued on covered accessories for and repairs on two Ford touring cars, all of which items were charged on the 8th and 9th of September, 1919, except an item of $3.05 which was charged on September 11, and another item of $1.50 which was charg’ed on September 12. The total amount of the account was $134.73.

The items were all furnished and charged to Cole, who does not dispute their correctness; but he says he only owned one of the cars, and that he sold that car, together with the accessories, to Denton on September 12, and that the sale was on a credit of thirty days, whereas the suit was brought before the expiration of that time. Denton' testified that he only bought one car from Cole, and that he bought that one without any knowledge of the claim which the plaintiff seeks to enforce, and that he was the sole owner of the other car long before the indebtedness sued on was incurred.

The testimony of Cole and Denton makes a complete defense to the demand sued on. But we can not say that the chancellor’s finding against them is clearly against the preponderance of the testimony.

Both Cole and Denton operated jitneys, and Cole was the admitted owner of one of the cars in controversy and the ostensible — if not the actual — owner of the other. Denton claims to have made his purchase on or about September 12 of the Cole car and the accessories on and in his own car, yet all the items of the account bear about that date. Cole represented himself to be the owner of both cars, and obtained the credit which was extended on the faith .of that reprsentation, and Denton must have known that fact.

Seventy-five dollars of the account was for three casings and three inner tubes, which Hanbury, who represented appellee, testified he saw on the car which Den-ton claimed as his own, and which he did not buy from Cole. Denton admitted these accessories were in and on his car, but he testified that' he bought them from Cole and paid for them without notice of any claim on the part of appellee. But his answers to the questions asked him on cross-examination justified the court in diregarding that testimony. He claimed to have taken these accessories from Cole in satisfaction of a debt which Cole owed him at the time; but when asked what Cole then owed him he did not remember, and when asked about how much was still due him answered, “I could not say.” He was equally indefinite about the terms of the purchase of the car which he claimed to have bought from Cole.

Other questions and answers by Denton are as follows :

Q. How much difference did you pay him between what he owed you and the $375, the price of the car?
A. We didn’t make that kind of a trade. I was to give $375 for the car and nothing was said about what he owed me.
Q. Did you give him $375 for the car?
A. No.
Q. How much did you give him for the car?
A. I paid him $150' out of the $375.
Q. Have you paid him the balance due on the car? A. No.
Q. Did you pay him $75 in cash for supplies, or did you give him credit on what he owed you?
A. Part credit and part cash — I don’t remember the amounts of each.
Q. Can you give the court some idea of the respective amounts?
A. No.
Q. How much do you owe Mr. Cole at this time?
A. I don’t know.
Q. Can you give an approximate estimate of the amount?
A. No.
Q. Did you own any car other than the Stanhope car at the time you purchased the three casings and three inner tubes from Hugh Cole?
A. Owned a half interest in one.
Q. Where was the car at that time?
A. Okmulgee, Oklahoma.
Q. Did you use those supplies or any part of them on that car; if so, state what you did use of them?
A. Three casings and maybe one inner tube' — I am not sure.
Q. Were these the casings you purchased from Hugh Cole?
A. Yes.

These essential details were left in as much doubt by Cole as by Denton.

The proceedings to enforce the lien here declared on the two automobiles was authorized by act 140 of the Acts of 1919 (General Acts 1919, p. 123). This statute gives all dealers in automobile accessories, and to all repair men who perform work or labor on any automobile, a lien on the automobile for which such accessories were furnished or repair work done for the valué thereof. The act provides that the lien shall not take precedence over a bona fide purchaser for value, withóut notice, either actual or constructive, of the claim of a lien. The act provides for constructive notice of a claim for a lien.

We think Denton knew of the transaction between Cole and appellee, and was not, therefore, an innocent purchaser of the car which he claims to have bought from Cole. We are also of opinion that Denton must have known that Cole had obtained credit for the $75 worth of accessories which were in and on the Denton car upon the assumption by appellee that Cole was the owner of the Denton car. He, therefore, suffered appellee to extend this credit upon the assumption that the supplies furnished would be secured by a lien on the car for which they were bought, and Denton is, therefore, es-topped from denying Cole’s ownership of the Denton car so far as enforcing the lien against it for the accessories found in and on it is concerned. Miller v. Wilson, 56 Ark. 360; Turner v. Watkins, 31 Ark. 429; Franklin v. Meyer, 36 Ark. 96; Jowers v. Phelps, 33 Ark. 465; Geren v. Caldarera, 99 Ark. 260; Fagan v. Stuttgart Normal Institute, 91 Ark. 141.

Judgment affirmed.


text:
    Gilstrap v. Stahl.
    Opinion delivered February 14, 1921.
    Vendor and purchaser — time not op essence when. — Where a vendor agreed to furnish an abstract showing a good title, and, upon a defect being discovered which would require an order of the probate court to correct, a supplemental agreement extended the time to furnish such abstract of title until May 1, it being deemed that the order could be had at the April term of such court, time was not of the essence of the eontrct, in the absence of a stipulation to that effect, and where the April term of the court was not held and the order was obtained in May following, there was substantial performance, and the purchaser could not recover the advance payment.
    Appeal from Sevier Circuit Court; J. S. Steel, Judge;
    reversed.

      B. E. Isbell, for appellant.
    The court erred in sustaining the demurrer. The only question which the demurrer presents is the sufficiency of the answer as a legal defense to the complaint, and it is sufficient and sustained by many decisions. In determining its sufficiency every allegation therein made, together with every inference which is reasonably dedueible therefrom, must be considered. 102 Ark. 294; 93 Id.
      374; 91 Id. 404; 70 Id. 163; 71 Id. 564; 75 Id. 66; 77 Id. 354; 110 Id. 139; 116 Id. 506; 52 Id. 378.
    The answer is a complete defense to the plaintiff’s complaint, and the trial court erred in holding that it is not.
    The exhibits may not assist the demurrer. This is a suit at law, and the exhibits can not be looked to to aid the complaint. The presumption on demurrer is that the allegations of the answer are true, and, the complaint thus standing alone, a good defense was interposed, and the demurrer should have been overruled. 53 Ark. 478; 33- Id. 544; 37 Id. 543; 34 Id. 536; 133 Id. 190. Nor does the fact that the answer admits the execution of the contract avail plaintiff anything. 33 Ark. 597. Even if the exhibits could be used to aid the demurrer, they could give no assistance in this case, for May 1 is not the essence of time of the contract, but the time limit is the date upon which the probate court finally approved the guardian’s sale. In arriving at the essence of time in a contract, the conditions of the parties and all the circumstances under which the contract is made should be taken into consideration. 105 Ark. 629; 134 U. S. 68. The nature of the transaction and the avowed object of the purchaser and seller could hardly be ascertained without a trial upon the merits of the issue raised by the answer.
    Defendant should be protected against the court’s failure. Both defendants did all in their power to perfect the title and within the time prescribed; they dealt openly and in good faith. Defendants should not suffer because the term of the court lapsed. The citizen is bound by the courts and their action; he can not control them. At most, he can only order his affairs and make his contracts in keeping with their holdings and the statutes which govern their procedure. Defendants have done this, and the answer so alleges and its truthfulness can' not be here attacked. The order sustaining the demurrer and the judgment should be reversed.

      Abe Collins, for .appellee.
    The language of the contract is plain, simple, certain and unambiguous; there is no room for construction. The intention of the parties is plain and easily ascertained from the language used, and they are bound by it. May 1 was the time limit; if not, why was not a different date written therein? Courts can neither supply nor rearrange words and sentences in an unambiguous contract, but must construe it as made. 105 Ark. 213. Where the language is 'clear and unambiguous, the acts of the parties under it can not be considered in construing it. 56 Ark. 414. It is only where the contract is ambiguous that the courts can resort to extraneous circumstances to ascertain the intention of parties. 28 Ark. 282; 52 Id. 65; 55 Id. 18; 90 Id. 272; 6 E. C. L. 841, § 231. Where a contract evidences care in its preparation, it is presumed that its words were employed deliberately and. with intention. It is not the province of courts to alter a contract by consideration or make a new one for parties; its duty is confined to the interpretation of the contract as made by the parties themselves. 13 O. J. 524-5, § 485. The question here is whether or not, admitting all the allegations of the answer, it amounted to a legal defense. We submit that the answer does not amount to a legal defense for the reasons stated supra. The contract was unambiguous, and its 'construction a question of law for the court. 101 Ark. 213; 79 Id. 172 -, 75 Id. 55; 67 Id. 553; 112. Id. 165. Hence the court did not err by setting the case by sustaining the demurrer. Antecedent propositions, correspondence and all prior writings and oral statements and representations were merged into the written contract. 104 Ark. 475. There is no error.
   Smith, J.

Appellee, plaintiff below, filed a complaint in the Sevier Circuit Court, in which he alleged that on December 6, 1919, he entered into a, contract with the defendant, G-ilstrap, who was acting as agent for his co-defendant, Mrs. Cox, by the terms of which he had bought Gom G-ilstrap, as the agent of Mrs. Cox, two lots in the town of De Queen, for the consideration of $2,575, of which $500 was cash in hand paid to said Gilstrap for Mrs. Cox. That it was provided in the contract of sale that -an abstract of title would be furnished and submitted to plaintiff for his inspection within thirty days, and that the cash payment of $500 was to be refunded in the event it should be impossible for Mrs. Cox to make a good title to said lands. A copy of that contract was made Exhibit A to the complaint. That on February 19, 1920, the said Mrs. Cox had wholly failed to submit to plaintiff the abstract of title in accordance with said agreement, and in order to give her an opportunity to do So plaintiff entered into a new contract with defendant — made Exhibit B to the complaint — by which time w’as extended to May 1, 1920, to furnish an abstract, with the opinion of B. E. Isbell, showing a good title in Mrs. Cox, with the proviso that upon failure so to do the $500 should be returned to plaintiff. It was alleged that the abstract and opinion were not furnished within the time limited, and the money had not been returned, and there was a prayer for judgment for the $500.

The answer admitted the execution of a contract for the sale of the lots for the price and upon the terms set out in the complaint; but it recites the fact to be that the abstract was furnished to plaintiff’s attorney, who, upon, an examination thereof, concluded that it would be necessary to obtain a certain order from the probate court, and the plaintiff was advised that this order could not be obtained before the second Monday in April, -when the court convened, and the plaintiff thereupon agreed that the necessary time should be given to obtain the order, and a supplemental agreement was then entered into, which provided that Mrs. Cox should have until May 1, 1920, in which to obtain the necessary order of court, it being the agreement and understanding of the parties that the order should be obtained at the earliest date consistent with the law and the procedure of the court, and that the supplemental contract was entered into for the sole purpose of giving Mrs. Cox an opportunity to obtain that order. That the April term of said court was not held, and was allowed by the judge thereof to lapse, but a session of the court was later held on the .........day of May under proclamation convening a special term of court. That the greatest diligence was used in perfecting the title, and that the title has been perfected and approved by the examiner. Wherefore it was prayed that plaintiff take nothing by his suit.

A demurrer to the answer was sustained, and upon defendants refusing to plead further judgment was rendered for the $500, and this appeal is from that order.

The suit is at law, and the allegations of the answer are not, therefore, controlled by the exhibits. But it is insisted that the recitals of the exhibits have been incorporated into the answer and have become a part of it, and that it appears from the recitals of the answer that May 1 was fixed as the time limit within which, an abstract showing a good title should be delivered, and that the abstract and opinion approving the title were not furnished by that time. In other words, the question to be decided is whether the parties have made time of the essence of the contract.

In the case of Nakdimen v. Brazil, 137 Ark. 188, we quoted from 9 Cyc., pp. 604-5, the following statement of the law: “In determining whether stipulations as to the time of performing a contract are conditions precedent, the court seeks simply to discover what the parties really intended; and if time appears, on a fair construction of the language and under the circumstances, to be of the essence of the contract, the stipulations in regard to it will be held conditions precedent. * * * Time is of the essence of a contract when it is a material object to which the parties looked in the first conceptions of it. ’ ’

Here the parties amended their original contract by extending to May 1 the time for furnishing abstract and for obtaining the opinion of Mr. Isbell. It does not contravene any rule of evidence to show the purpose of the parties in changing the date upon which the abstract and opinion were to be furnished. In interpreting a contract it is proper for .the court to consider the situation of the parties with reference to the subject-matter about which they have contracted, and it was, therefore, proper to show that the purpose of the extension was to afford an opportunity to procure the necessary court order. These orders are obtainable only by following the procedure prescribed by law; and while, under the allegations of the answer, it was the intent of the parties that the utmost diligence should be used in applying for and procuring this order, it was necessarily in their contemplation that the thing contracted for could only be obtained in the orderly processes of the law, and the answer alleges that it was thought that May 1 would afford reasonable time to obtain the order which made the extension of time necessary. In contemplation of the parties the thing really contracted for was expedition and diligence in obtaining the order. The contract does not recite that time was of the essence of the contract; nor is that inference necessarily deducible from the language employed; and, when this language is read in the light of the situation of the parties and the subject-matter with reference to which they were contracting, we conclude that the parties had no intention to make time of the essence of the contract. They were contracting in regard to the approval of the title to real estate, and it was known, when the supplemental contract extending the time was made,- that the attorney to whom the abstract, had been submitted had found a defect which, in his opinion, could be remedied only by an order of the court, and time for that purpose was-granted, and this was the purpose of the amendment to the original contract. The -contract between the parties was not a mere option to buy which might or might not be exercised. Ind. & Ark. Lbr. Co. v. Pharr, 82 Ark. 573. It was one for the sale of land to be consummated upon the approval of the title.

We think the recitals of the answer set out above show a substantial compliance with the contract, which entitles the defendants to demand that plaintiff proceed with the discharge of the terms of purchase before demanding the return of the money which was to be treated as an initial payment if the title was approved. Mays v. Blair, 120 Ark. 69; Smith v. Berkau, 123 Ark. 90; Feibelman v. Hill, 141 Ark. 297; Butler v. Colson, 99 Ark. 340; Atkins v. Rison, 25 Ark. 138; Evans v. Ozark Orchard Co., 103 Ark. 212.

We conclude that the demurrer to the answer should have been overruled, and, for the error in sustaining it and in rendering judgment on the complaint, that judgment will be reversed and the cause remanded with directions to overrule the demurrer.


author: Smith, J. McCulloch, C. J.

text:
    Brock v. Turner.
    Opinion delivered February 14, 1921.
    1. Wills — presumption against partial intestacy. — The presumption against partial intestacy, though not controlling, must always be taken into account when the language employed in a will is so ambiguous as to require construction.
    2. Wills — after-acquired real estate. — A wife’s will, leaving to her husband “all of my personal property and real estate as follows, towit, describing a certain tract, also all chattel property,” etc., held to apply to real estate acquired after the execution of the will.
    3. Wills — after-acquired property. — Where a will manifests a purpose to dispose of after-acquired property, such effect will be given to it.
    Appeal from Folk Circuit Court; James S. Steel, Judge;
    affirmed.

      Minor Pipkin, for appellants.
    The will does not show an intent on the part of the testatrix to give her husband, J. F. Marshall, or any one else the land acquired after executing the will. The intention as shown by the words used should be carried out. 90 Ark. 152. But construction is unnecessary here, as there is no ambiguity, nor inconsistent or repugnant clauses. 124 Ark. 548. The testatrix had in mind no other land than that described in the will, and only intended a gift of lands then owned hy her and no other. 68 Conn. 177. It is clear the testatrix died intestate as to the after-acquired lands. It was her intent to devise only the lands described in the will and this intent should be effectuated. 116 Ark. 328.
    The presumption against partial intestacy is not applicable here. Ill Ark. 54; Page on Wills 545; 142 111. 214.

      Norwood & Alley, for appellees.
    The will shows an intent to dispose of all the .property of which she died seized .and to make her husband the sole beneficiary and appellees holding under him are the legal owners, and the lower court so held and properly.
    The will should be construed to cover after-acquired property. It was the intention to dispose of the whole estate existing at time of death. 51 Ark. 61.
    The presumption is against partial intestacy. 51 Ark. 61; 90 Id. 152; 104 Id. 448; 115 Id. 9. The words “the remainder and residue of my money” in a will made by one who had no real estate at the time will pass after-acquired realty where the will shows an intent not to die intestate and to exclude the heirs except as they were given legacies. 11 L. E. A. 767. This case is not like 111 Ark. 54.
    The purpose of construction of a will is to ascertain the intention of the testator from the language used, and when ascertained, it must prevail. 104 Ark. 445. There was no children, and it is clear she intended to leave what she had to her husband, and the court so held.
   Smith, J.

The decision of this case turns upon the construction of the following will:

“I give, devise and bequeath to my beloved husband, John F. Marshall, all of my personal property and real estate, as follows, towit: Forty acres, being the southeast quarter of the northwest quarter of section eleven (11), township four (4), range 32 west, containing sixty acres, more or less. Also all chattel property of any kind, including money on hand, notes, household goods, etc. And if there should hereafter be any legal heirs of any of this, my estate, then and in that event it is my will and testament that all such may be paid the sum of one dollar in money to each. ’ ’

The will was executed by Mrs. Marshall, the testatrix, on February .1, 1908. On September 2, 1909, she acquired the real estate which forms the subject-matter of the litigation, and after her death, February 1, 1913, her brothers and sisters and the children of certain brothers' and sisters claimed the property which she had acquired subsequent to the execution of the will as her heirs at law. Did the property acquired after the execution of the will pass under it?

We answer the question in the affirmative. In the first place, there is a presumption against partial intestacy. Of course, no controlling effect is to be given to this presumption, but it is one which must always be taken into account when the language employed in a will is sufficiently ambiguous to require the application of rules of construction in extracting its meaning.

The will devises “all of my personal property and real estate.” It is apparent that the adjective “all” modifies both classes of property — the real estate as well as the personal property. The sentence immediately following the one which undertakes a specific description of all the land then owned by the testatrix undertakes a description of the personal property. Its language is: “Also all chattel property of any kind, including money on hand, notes, household goods, etc.” The phrase “on hand” referred, of course, to the time of death. Manifestly, there was no purpose to devise specific pieces of money owned by the testatrix at the time of the execution of the will; nor is it to be believed that she did not intend to collect the notes then due her but meant to keep them for the benefit of her husband at her death.

The will, of course, was made in contemplation of death, and the property disposed of was that “on hand” when that event occurred. No other construction of the will appears possible so far as tbe personal property is concerned; and we think the testatrix made no distinction between her real estate and her personal property in. this respect.

We think this construction of the will is reinforced by the concluding sentence thereof. The testatrix knew that she had brothers and sisters who .might survive her or be themselves survived by their own descendants. She referred to them as a class- — as they will exist at thé time of her death — and she designates the part they each and all of them are to have of ‘ ‘ my estate. ’ ’ The phrase ‘ ‘ my estate” as certainly comprehends real estate as it does personal property, and the part of that estate given to each of these heirs is “the sum of one dollar in money to each. ’ ’

We conclude, therefore,' that it was the purpose of the testatrix to dispose of the estate which she might own at the time of her death; and when a will manifests that purpose, it includes after-acquired property of which the testator or testatrix dies seized and possessed. Patty v. Goolsby, 51 Ark. 61; Galloway v. Darby, 105 Ark. 558.

The court -below so construed the will and entered judgment in accordance with that construction; and that judgment is therefore affirmed.

McCulloch, C. J.

(dissenting). I think the majority is giving too much force to the presumption against partial intestacy, and in so doing have disregarded and overturned the express language of the will of the testator. We have recognized the. force of that rule in many of our decisions, but have usually qualified the statement of it by saying that the presumption of partial intestacy does not arise where “such intention clearly appears from the language used in the instrument. ’ ’ Galloway v. Darby, 105 Ark. 558; Webb v. Webb, 111 Ark. 54.

In the present case the language of the will unmistakably showed what the intention of the testator was. He willed all the property that he owned at that time, and it is manifest that he had no intention of willing anything else. He described the particular property that he intended to convey, and that was all he owned at that time. He did not own the property now in controversy.

In interpreting the language of the will for the purpose of ascertaining the intention of the testator we should treat it as having spoken as of the date of the execution of the will. Webb v. Webb, supra. At that time the land in controversy was not owned by the testator; and, since the language used applied only to specific property which he then owned, there is no room to apply the doctrine of presumption against partial intestacy. Nor should we give any additional force to the presumption by -reason of the fact that the heirs were cut off with a nominal legacy. That only shows that, out of the property sought to be conveyed under the will, his intention was to limit the bequest to the heirs to a nominal one. It seems to me to be that the effect of the court’s decision in this case is to make a will for the testator which he did not see fit to make for himself — that is, to include after-acquired property which the testator evidently did not have in mind when he executed the will, and did not use appropriate language to convey.


author: Humphreys, J.

text:
    Haines v. Rumph.
    Opinion delivered February 14, 1921.
    1. Principal and agent — ratification of agent’s unauthorized act. — Before one can be held to have ratified any unauthorized act of one who assumes to be his agent, the principal must have knowledge of all the material facts upon which such agency is predicated; and ignorance of such facts renders the alleged ratification ineffectul and invalid.
    2. Principal and agent — ratification of unauthorized land sale. —In order to ratify an unauthorized sale of their land by an agent, the principals must know the consideration, terms and conditions of sale.
    3. Principal and agent — ratification by execution of deed.— Principals will be held to have ratified an unauthorized sale of their land by an agent where they signed and acknowledged a deed with full knowledge of the consideration, terms and conditions of the sale.
    4. Principal and agent — withdrawal op ratification. — Princi-. pals who have ratified their agent’s unauthorized sale of land can not withdraw such ratification upon discovering that the land had increased in value on account of oil developments.
    5. Specific performance — directing attorney to deliver deed.— Where grantors delivered a deed to attorneys to be delivered to the grantees, and one of the grantors, who was not made a party to the suit, directed the attorneys not to deliver the deed until certain conditions were performed, delivery of the deed by such attorneys will not be compelled where the stipulated conditions were not performed.
    Appeal from Ouachita Chancery Court; J. M. Barker, Chancellor;
    reversed.

      Thomas W. Hardy and Mehaffy, Donham & Mehaffy, for appellants.
    Plaintiffs to be entitled to recover would have to show‘either that Haines with whom it was claimed a contract was made and to,, whom $25 was paid, had authority to bind them in the transaction, or that Haines ratified the transaction after full knowledge of the facts; and the evidence is insufficient to sustain the findings of the chancellor on either of these points. 105 Ark. 446; 53 Id. 208; 124 Id. 360; 64 Id. 217; 92 Id. 315. Ratification with full knowledge is not shown. 55 Ark. 240; 64 Id. 217; 74 Id. 557; 21 R. C. L. 922h8.
    The parties signed the deed without a full knowledge of the facts, and there was no ratification, and there was no delivery of the deed. 24 Ark. 244. Delivery was necessary, and there was none. 8 R. C. L., § 53; Ih, § 57.

      Powell é Smead, for appellees.
    1. The evidence sustains the findings of the chancellor. If there was either a sufficient delivery of the deed so as to pass title, or if there was a ratification of the contract by Cf. L. Haines and Grace Tannehill, the decree is correct.

      2. There was certainly a sufficient delivery of the deed. 77 Ark. 89; 100 Id. 127; 123 Id. 601, and the evidence shows ratification with full knowledge. 55 Ark. 241; 90 S. W. 737.
   Humphreys, J.

This suit was instituted by appellees against appellants in the Ouachita Chancery Court to enforce a contract executed on the 11th day of December, 1919,' between appellant, ~W. S. Haines, and appellees, for the sale and purchase of certain lands in said county, for and in consideration of the sum of $2,000, $25 of which sum was paid in cash at the time, the balance to be paid when the deed was executed and delivered. It was alleged that W. S. Haines represented himself, his brother, G. L. Haines, and his sister, Mrs. Grace Tannehill, in the transaction, and, that, pursuant to said contract, the said W. • S. Haines, G. L. Haines, Laura Hainés, his wife, and Mrs. Grace Tannehill, executed a deed conveying said real estate to the appellees and delivered same to Gaughan & Sifford, a firm of attorneys in Camden, for appellees, upon the payment of the consideration; that said appellees offered to pay the consideration to Gaughan & Sifford, who refused to accept same; that they will return the deed to the grantors unless enjoined from doing so. Appellees tendered the balance of the purchase money into court, prayed for a restraining order against appellants from encumbering or transferring said real estate to others, and for a mandatory injunction against Gaughan & Sifford, coihmanding them to deliver the deed to appellees, and for all other relief to which they might be entitled.

Gaughan & Sifford filed answer, admitting that the deed was in their possession, having received same through the mail from Boy L. Haines, who resided in Gloster, Mississippi, with instructions not to deliver it until appellees paid them $500 for him and until he received his share of the personal property in the estate of his grandmother, Cora J. Haines, deceased; that they would continue to hold the deed subject to the orders of the court.

Appellants interposed the defense that W. S. Haines, in making the alleged contract for the sale of said real estate, was without authority to represent G-. L. Haines, his brother, or Mrs. Grace Tannehill, his sister, and that neither, after obtaining full knowledge of the facts of the trade, by act or word ratified said contract; that, before they obtained knowledge of the facts of the trade, they executed the deed in question, but, before same was delivered, they recalled it. Their prayer was for a dismissal of appellees’ bill for the want of equity.

The cause was submitted to the court upon the pleadings and evidence, which resulted in a decree commanding Gaughan & Sifford to deliver the deed in question to appellee, upon their payment to the clerk of the court of $1,975, the balance of the purchase money, which sum should be equally divided between W. S. Haines, G. L. Haines and Mrs. Grace Tannehill after the. administration upon the estate of Cora J. Haines, deceased, with the will annexed, should be closed and all bequests under the will and probated debts against the estate should be paid.

The testimony offered in behalf of appellees was, in substance, to the effect that W. S. Haines, claiming to represent himself and the other heirs of Cora J. Haines, deceased, sold the land in question to appellees for $2,000, $25 of which sum they paid to him in cash, the balance to be paid when the deed for said lands was delivered; that the following receipt was given by him for the cash payment: “Camden, Arkansas. 12-11-1919. Received of G. S. Rumph and H. B. Lide, $25 as part payment on our home place, south part of city of Camden, known as the Joel Haines place, consisting, of about 30 acres, more or less, and the consideration of the whole amount is to be $2,000 and all taxes for year 1919 to be uaid by us, Haines heirs. (Signed) W. S. Haines.” That, at the time, it was understood Roy L. Haines owned an interest in the real estate; that, pursuant to the agreement, a deed was executed by appellants and sent to the firm of Gaughan & Sifford in Camden for delivery to them; that, some time after the deed was made, W. S. Haines requested them to take hack the $25 and call the trade off; that they refused, and Haines then said he was going to call the trade off anyhow and threw the $25 down in the office, which was picked up by Joe Terrell, put in an envelope with Mr. Haines’ name on it and put in the safe; that they refused to accept the $25; that, after appellants refused to carry out the contract, they offered to pay them the balance of the consideration, which they refused; that they also offered to pay the balance of the' consideration to Gaughan & Sifford, which was refused; that they did not tender the actual money.

The testimony offered in behalf of appellants was, in substance, to the effect that ~W. S. Haines acted for himself and, without authority, assumed to act for the other appellants in the sale of the real estate in question for a cash consideration of $2,000 and at the time accepted $25 as a part payment; that, pursuant to the contract, he executed a deed himself for the land to appellee, G. S. Humph, in which he expected appellants, Geo. L. Haines, Laura Haines, his wife, Mrs. Grace Tannehill {nee Haines) and Roy L. Haines and wife to join, it being understood at the time that Hoy L. Haines had an interest in the real estate; that, without explaining the nature of the transaction to Geo. L. and Laura Haines, they signed and acknowledged the deed, and it was then sent to Mrs. Grace Tannehill in Texas for her signature and execution; that she executed it and forwarded it to Roy L. Haines at Gloster, Mississippi, for execution; that Roy L. Haines claimed an interest in the land, as well as the personal property, belonging to his grandmother, Cora J. Haines, deceased, executed the deed and mailed it to Gaughan & Sifford for delivery to appellees when they paid $500 to said firm for him for his interest in the real estate and such additional sum as might be due him on settlement of the estate of' Cora J. Haines, deceased; that the will of Cora J. Haines, deceased, was probated, by the terms of which only $50 was devised to the said Roy L. Haines, and the entire real estate bequeathed to W. S. Haines, G. L. Haines and. 'Mrs. Grace Tannehill. Before the transaction was closed by delivery of the deed to appellees by Gaughan & Sifford, the trade was called off by the appellants and Gaughan & Sifford instructed not to deliver it. The letter written by Mrs. Grace Tannehill to her brother, W. S. Haines, instructing him not to proceed further with the deal is as follows: “If sale of place has not gone through, call it off at once. I believe we can do better. The papers are full of oil prospects there in Arkansas.”

■Neither Roy L. Haines nor his wife, Clara Haines, were made parties defendant. The cause was submitted to the court upon the pleadings and evidence, which resulted in findings that W. S. Haines, representing himself and assuming to represent Geo. L. and Laura Haines and Mrs. Grace Tannehill, contracted to sell the lands in question to appellees for $2,000, which contract was ratified by Geo. L. Haines, Laura Haines and Mrs. Grace Tannehill ; that W. S, Haines, George L, Haines and Mrs. Grace Tannehill were the sole owners of the land devised from their mother, Cora J. Haines. Upon these findings a decree was rendered requiring appellees to pay the clerk of the court the balance of the purchase price of the land to be held by the clerk until the administration pending on the estate of Cora J. Haines, deceased, shouid be finally settled and the liabilities on same liquidated, after which the balance of the consideration not used in liquidating the indebtedness against said estate and paying the bequests in the will should be divided equally between W. S. Haines, George L. Haines and Mrs. Grace Tannehill, and that, upon the payment of the balance of the consideration, to the clerk by appellees, Gaughan & Sifford should deliver the deed, deposited with them by Rov L. Haines, conveying said real estate to appellee G. S. Rumph. From the decree, appellants have prosecuted an appeal to this court.

Appellants insist that the evidence is insufficient to uphold the finding of the chancellor that the contract for the sale of the land, made by W. S. Haines, was ratified by Geo. L. Haines and Mrs. Grace Tannebill, and that, for that reason, the court was in error in ordering a delivery of the deed, deposited with Gaughan & Siiford, to appellees. In relation to the doctrine of ratification of an unauthorized act of an agent by the principal, this court said in the case of Coffin v. Planters Cotton Company, 124 Ark. 360, that (syllabus 2), “Before one can be held to have ratified any unauthorized act of one who assumes to be his agent, the principal must have knowledge of all the material facts upon which said agency is predicated, and ignorance of such facts renders the alleged ratification ineffectual and invalid.” The qnes-\ tion at once arises, what are the material facts necessary for a principal to know in a land sale, in order to bind him on a contract of sale of same, executed by an unauthorized agent? “Where no fraud or deception is charged, the material facts are the consideration, terms and conditions of sale. All this was known, or could have been known, by Geo. L. Haines and Mrs. Grace Tannehill before the execution of the deed in question. No misrepresentation as to the contents of the deed was made. The deed-showed on its face that the consideration was $2,000 cash. With full knowledge of the consideration, terms and conditions of the sale, they both signed and acknowledged the deed conveying same to appellees, and it was mailed by Mrs. Grace Tannehill to Roy L. Haines for execution and delivery by him. The only reason for recalling the deed is that,, after the execution of same, it was discovered that there was oil talk in the neighborhood of the lands. Unless some deception had been practiced by appellees or the unauthorized agent upon them in this regard, the mere discovery that lands had enhanced on account of oil developments would furnish no excuse for withdrawing their ratification of the unauthorized act of their agent, W. S. Haines. We think the execution of the deed by Geo. L. Hainés and Mrs. Grace Tannehill, under the facts detailed, was a ratification of the contract of sale and purchase of said land. The facts were ample to justify a decree against appellants for specific performance, and the court should have ordered W. S.. Haines, Geo. L. Haines and Mrs. Grace Tannehill to execute a deed to appellees for said real estate, upon the payment by them of the consideration agreed upon.

We do not think, however, the facts warranted a decree ordering Gaughan & Sifford to deliver the deed, because one of the parties grantor therein was Roy L. Haines, who claimed an undivided one-fourth interest in the land, and deposited it with Gaughan & Sifford with directions not to deliver it until that amount was paid to them for him and until they procured an adjustment and settlement of his interest in the personal estate of Cora J. Haines, deceased. He was not made a party to the suit, and the court could not adjudicate his interest in the real estate so as to bind him without first, making him a party to the suit. The decree, in regard to the delivery of the deed, was erroneous, and, in that respect, is reversed, and the cause is remanded with directions to render a decree for specific performance of the contract.