author: McHaney, J. Smith, J.,

text:
    Minetree v. Minetree.
    Opinion delivered February 24, 1930.

      Jeff Bratton, for appellant.

      G. M. Buck, for appellee.
   McHaney, J.

In April, 1906, Dr. James N. Minetree, then a resident of Manila, Chickasawba District, Mississippi County, Arkansas, attempted to' adopt appellant, then hearing’ the name of Ollie McCain, an infant under two years of ag’e, as his son and heir; the order of the probate court of said county and district being as follows:

“Order eor AdoptioN oe Child.
“Pursuant to requests of a certain petition made by Dr. James N. Minetree of Manila, Arkansas, and presented to< the court on the 24th day of April, 1906, asking for the adoption of the infant son of Mr. and Mrs. Luther E. McCain, as his own and lawful heir, by showing in said petition that the mother of said child is dead and (hat the father thereof' is a resident of Mississippi County, Arkansas, and that said child is possessed of no property whatever and by Luther E. McCain, father of said infant child appearing in open court on the 24th day of April, 1906, and giving his consent to this order of adoption, it is therefore ordered 'by me a judge of said probate court that said infant child be adopted agreeable (o the terms of above said petition and that its name be Ollie McCain Minetree, and that the care and custody of said infant child be given to petitioner, James N. Minetree. ’ ’

The petition mentioned in the order had been lost from the files and could not be introduced in evidence. Appellant was thereupon taken into the home of Dr. Minetree and appellee, who is his widow, with whom he thereafter continued to reside, and who treated him as a son, supported him, and attempted to educate him. Shortly after the above order of adoption was made, Dr. Minetree removed with his wife and appellant from thence to Dona Ana County, New Mexico, where they continued thereafter to reside, and where the appellee now resides. In June, 1923, Dr. Minetree died testate, his will having- been executed in November, 1919, leaving all his property to his wife, the appellee. It was duly probated in New Mexico and placed of record in Mississippi County, Arkansas. Appellant’s name was not mentioned in the will. He continued to live with the appellee, his adoptive mother, until the fall of 1928, when, believing himself entitled in law to the property of his adoptive father, subject to the widow’s right of dower, he demanded same, which was refused, and this suit followed. About 200 acres of land in Mississippi County are involved. The court found that the above order of adoption was and is void, and dismissed appellant’s complaint for want of equity. Was the learned chancellor correct in so holding?

Sections 1 and 2 of the Act of February 25,1885, No. 28, p. 32, now ^ 252 and 253, 'C. & M. Digest, provide that (1) “any person desirous of adopting any child may file his petition therefor in the probate court, in the county where such child resides”; and (2) “such petition shall specify, first, the name of such petitioner; second, the name of such child, its age, whether it has any property, and, if so, how much; third, whether such child has either father or mother living, and, if so, where they reside. Such petition shall be verified by the oath or affirmation of such petitioner.”

The first case coming to this court after the adoption of the above statute was Morris v. Dooley, 59 Ark. 483, 28 S. W. 30, 31, 430. Neither the petition for, nor order of, adoption in that case showed the child to be a resident of the county (Phillips) at the time the petition was filed and the order made. The court said:

“The proceeding to adopt a child as an heir was unknown to the common law, and in this State exists only as a special statutory proceeding. Prior to the passage of the act of February 25, 1885, authorizing such proceedings (Acts 1885, p. 32), the probate courts possessed no such powers, and could exercise no such jurisdiction, as it conferred. The .jurisdiction was conferred by a special statute. Mr. Black in his work on Judgments, says: ‘It is well settled that a judgment in a summary proceeding must show upon its face everything that is necessary to sustain the jurisdiction of the court rendering it. ’ Section 280. The rule seems to be, especially in this State, as settled by this court in Hindman v. O’Connor, 54 Ark. 643, 16 S. W. 1052, 13 L. R. A. 490, that ‘where the jurisdiction is conferred on a court by "special statute, and which is to be exercised in a special and often summary manner, the judgment can only be supported by a record which shows jurisdiction, and no presumptions as to its jurisdiction will be indulged.’ Harvey v. Tyler, 2 Wall. 328 (17 L. ed. 871); Galpin v. Page, 18 Wall. 371 (21 L. ed. 959); Gibney v. Crawford, 51 Ark. 35, 9 S. W. 309; Hindman v. O’Connor, 54 Ark. 643, 16 S. W. 1052, 13 L. R. A. 490; Black, Judgments 279; Freeman, Judgments 123; 12 Am. & Eng. Enc. Law, 276 et seq.
“But it is contended that only those facts which the statute requires to be set out in the petition need to be made to appear in the record; but we hold, on the contrary, that in a proceeding oif this kind, under a special statute, and not according to the course of the common law, the court in which the proceeding is had quoad hoc must be considered as an inferior court, and that, unless all jurisdictional facts appear in the record itself, the judgment in the proceeding will be void upon collateral attack. In Henning v. Planters’ Ins. Co. (C. C.) 28 F. 440, the court said: ‘Nor can the want of such averment or showing be suprdied bv proof alkmde the record, offered at the trial of the subsequent suit, predicated on the alleged judgment. The defects of the record cannot be so pieced or patched up by parol.’ ‘Jurisdictional facts cannot rest in parol to be proved in one case, and perhaps disproved in another.’ Judge Cooley, in Montgomery v. Merrill, 36 Mich. 97. There is nothing in Railway Co. v. Lindsay, 55 Ark. 281, 18 S. W. 59, that militates against this doctrine. There it is held that the judgment of the justice of the peace could be supported by parol, as on appeal to the circuit court the cause was to be tried de novo; and the statement filed in lieu of the complaint was amendable in the circuit court, as well as in the magistrate’s court, and would be treated as amended to conform to the evidence, which had been heard without objection.”

Mr. Justice Riddick wrote a very strong dissenting opinion in that case, which was concurred in by Mr. Chief Justice Bunn, but the majority opinion has been the law in this State since that time, and has been consistently followed by this court since. Willis v. Bell, 86 Ark. 473, 111 S. W. 808; Avery v. Avery, 160 Ark. 375, 255 S. W. 18; O’Connor v. Patton, 171 Ark. 626, 286 S. W. 822, 826. And, as further sustaining Morris v. Dooley, see St. Louis, I. M. & S. R. Co. v. Dudgeon, 64 Ark. 108, 40 S. W. 786; Ward v. Magness, 75 Ark. 12, 86 S. W. 822; Reeves v. Conger, 103 Ark. 446, 147 S. W. 438; Beakley v. Ford, 123 Ark. 383, 185 S. W. 796; Hart v. Wimberly, 173 Ark. 1083, 296 S. W. 39.

(1) Appellant concedes that such is the law in this State, but insists that, since, at the time of the order of adoption, lie was an infant of tender years, and that the order shows his father to be a resident of Mississippi County, the fact of his residence is sufficiently shown on the face of the record, and that the order of adoption is valid. It will be noticed that the order does not state that the minor was at the time a resident of the Chick-asawba District of Mississippi County. It does state 1 ‘ that the mother of said child is dead and that the father thereof is a resident of Mississippi County, Arkansas.” Assuming without deciding that the finding in the order that the mother is dead and that the father is a resident of the county is sufficient to establish the residence of the child in the county on the general rule that the residence of the father is that of his minor child, still it is not sufficient to show that the residence of either the father or the child was in the Chickasawba District of that county. By act No. 81, Acts 1901, p. 136, Mississippi County was divided into two judicial districts, and the jurisdiction of the circuit, chancery, and probate courts of each district was defined. In § 14 of said act, it is said: ‘ That all matters of probate jurisdiction pertaining to that part of Mississippi County within the Chickasawba District and to persons and property resident and being therein shall be subject to the jurisdiction and examination of the probate court of Mississippi County for the Osceola District. ’ The use of the word ‘ ‘ Osceola’ ’ in this connection is clearly a clerical error in copying or printing, as the whole context shows that the word “'Chickasaw-ba” was intended. Otherwise it would be meaningless. As regards probate jurisdiction, the two districts are the same as separate counties. Therefore, even though it be assumed that the residence of the child is that of its father, the order of adoption is fatally defective in failing to- affirmatively show on the face of the record that the father was at the time a resident of the Chickasawba District of Mississippi County, in the absence of a finding that the child was such a resident, because the jurisdiction of the court depended upon it.

Appellant next says that, even though the adoption order be held void, appellee is estopped from asserting its invalidity. We cannot agree with appellant, as we are of the opinion this court has held to the contrary in Avery v. Avery, supra, and inferentially at least in the other adoption cases above cited. Here, as we have already shown, the order is void on its face for lack of jurisdiction of the court. It is the same as if no order of adoption had ever been made. A valid will was made by Dr. Minetree, which omitted to name appellant therein. All his property was given to appellee, and no course of conduct on the part of either toward appellant could e-stop appellee from claiming the property as sole beneficiary against a stranger in blood who claims under a void order of adoption. As said in O’Connor v. Patton, supra, “The right -of inheritance as such is conferred in our State upon a stranger in blood only by pursuing’ the special statutory proceeding for adoption”; and we think the statute should be strictly construed as against the adopted child, “because it is in derogation of the general law of inheritance, which is founded on natural relationship, and is a rule of succession according to nature which has prevailed from time immemorial.” 1 Cyc. p. 932.

It is finally urged that there was an oral contract of adoption between the father of appellant and Dr. Mine-tree. ■Conceding this to be so, still appellant must fail. This exact point was decided against appellant in O’Connor v. Patton, supra, where we said: “'Conceding, without deciding, that an oral contract ¡for the adoption of a child and to give the same rights as a natural child, may be enforced after the death of the foster parent, this doctrine could not avail Louis E. Patton under the pleadings and proof in this case, because A. H. Patton disposed of all the property of which he was possessed by will which was .duly probated by .judgment of the probate court. £ * # * The mere contract to adopt is not sufficient of itself to make the child a legal heir of the promisor, because the right to take as heir exists only (by operation of law. The child takes in these cases by virtue of the contract and by way of damages or specific performance. An agreement to adopt does not prevent the person making the agreement from disposing by will of all his property to other persons than the child to be adopted; but an agreement, either express or implied, to give the adopted child a certain portion of the adoptive parent’s property, will be enforced.’ 1 C. J. p. 1377, § 21(b). Our statute providing that, where a person makes a will and omits to mention the name of a child, if living, etc., he shall be deemed to have died intestate, and the child whose name is omitted shall be entitled to a child’s portion of the estate, refers to natural children, or legally adopted children. The right of inheritance as such is conferred in our State upon a stranger in blood only by pursuing the special statutory proceeding for adoption. ’ ’

Having examined all grounds urged for a reversal and not finding- them well taken, the decree must be affirmed. It is so ordered.

Smith, J.,

(dissenting). There are no subjects upon which the conscience of the courts should be more tender than those relating to the custody, support, and adoption of infants. The human soul is capable of no sentiment more noble and unselfish than that of love for little children. With animals, the love of offspring- is the instinct which preserves their species, and the human race would not survive without it. Certainly, humanity’s progress towards civilization has been aided by this love, and the law here under review is a recognition of it, and, in my opinion, the law should not be whittled away by technical constructions. On the contrary, it should have the most liberal construction to effectuate its humanitarian and Christian purpose, and it is the general policy of the courts to so construe such statutes.

Indeed, as Mr. Justice Riddick points out in his dissenting opinion in the case of Morris v. Dooley, upon which case the majority rely, it has been doubted by some courts whether the heirs of an adult, who has procured an order adopting a child as his own, have any right to object that the prescribed procedure in procuring the order of adoption was not strictly followed.

It is not my purpose, however, to assault the opinion in the Dooley case. The dissenting opinion of Mr. Justice Riddick, in which Chief Justice Bunn concurred, does that to my satisfaction, but I do protest against its unnecessary extension, and, with due respect for the majority, I say that the doctrine of that case has been extended in the majority opinion.

The statute enumerates the recitals which the petition must contain, and the residence of the child is not one of these, yet the order in the Dooley case was held void for the sole reason that it did not recite that the child was a resident of the county in which the order of adoption was made. The order did recite that the parents of the child were dead, and there was therefore no presumption as to its place of residence, as the presumption which the law indulges that the residence of an infant is that of its parents could not be applied in that case, they being dead. But the order here held defective and void recites that the mother was dead, but that the father was a resident of Mississippi County and present in court, and does not the recital that the only living parent was a resident of Mississippi County carry irresistibly the implication that this two-year-old infant was also a resident of that county?

In the chapter on “Domicile,” 9 R. C. L., § 10, p. 547, it is said: “It is a general rule that an infant cannot of his own volition acquire a domicile. It is also a well-estahlished rule that the domicile of every person at his birth is the domicile of the person on whom he is legally dependent, whether it is at the place of birth or elsewhere ; and so the domicile of the father is in legal contemplation the domicile of his minor children. If the parents change their domicile, that of the minor necessarily follows it, though there is authority to the effect that in order to change the child’s domicile the parents must act in g’ood faith and with reference to the welfare of the child. The domicile of an infant, if legitimate, is that of the father, if living. On the death of the father, the domicile of a minor follows that of its mother during her widowhood; but the last domicile of an infant’s deceased father fixes the legal residence of the infant in the absence of proof of the residence of the surviving mother. On the death of both parents the domicile last derived from the parents, or either of them, continues to be the domicile of the child until legally changed or until the child reaches his majority, when he has power to choose and acquire his own domicile. ” The following cases from this court sustain the text quoted: Grimmett v. Witherington, 16 Ark. 377, 63 Am. Dec. 66; Johnston v. Turner, 29 Ark. 280; Young v. Hiner, 72 Ark. 299, 79 S. W. 1062; Landreth v. Henson, 116 Ark. 361, 173 S. W. 427; Johnson v. Taylor, 140 Ark. 100, 215 S. W. 162; Taylor v. Collins, 172 Ark. 541, 289 S. W. 466.

The attorney who was employed by Mrs. Minetree to procure and prepare the order of adoption testified that in the preparation of the order of adoption he had the statute before him, and that he thought he had prepared an order in exact conformity with the statute, and I submit that it is only by a technical and strained construction of the statute that the contrary can be held.

Other courts have not construed their adoption statutes so technically, but have sustained such proceedings where there has been a substantial compliance with the statute, upon the theory that the proceeding was for the benefit of infants, who had no volition in the matter, and whose interests it was the duty of the courts to protect.

In ordinary proceedings of this kind, the child is not consulted, and it has no more control over the proceeding than it had over its own natural birth. Its destiny is in other hands. It is without volition. Surely, its future should not be trifled with, and the order of adoption fixes its future. The child loses its identity, its name; it becomes another person; it has another parent. Such a proceeding should not be declared void unless the letter of the law plainly demands.

In the case of Milligan v. McLaughlin, 94 Neb. 171, 142 N. W. 675, 46 L. R. A. (N. S.) 1134, it was held by-the Supreme Court of Nebraska (to quote the headnote) : “While, under the provisions of § 800 of the Code of Civil Procedure, a person desiring to adopt a child should file the petition for adoption in the county of his residence, and the county court of another county should refuse to receive and file the same, yet, the statute being-enacted for the benefit of the child, in a case where the facts are that all the interested parties appeared before the county court of another county, and agreed on the one side to relinquish the child, and consented to its adoption on condition that it should have the full rights of heir-ship as if born in wedlock, and on the other to- adopt and make it an heir, and the child is surrendered to the custody of, and remains in the family of, the adopting parent until the death of that parent, which occurred while the child was of tender years, the collateral heirs of the deceased adopting parent are estopped to deny the validity of the adoption proceedings and that the child is entitled to inherit..’ ’

That may he an extreme ease, and it-is certainly unnecessary to go to the same length to uphold the order of adoption here under review. The case does show, however, the disposition of courts to uphold such orders whenever it is possible to do so. -

The case of Kenning v. Reichel, 148 Minn. 433, 182 N. W. 517, 518, 16 A. L. R. 1016, reviews many cases on the subject, and it was there said that “there need not be more than a substantial compliance with the requirements of the statute to sustain the validity of the proceeding;” and our case of Coleman v. Coleman, 81 Ark. 7, 98 S. W. 733, is one of the cases cited in support of that statement. In the annotator’s note to this Kenning case, it is said: “Formerly, the courts' were inclined to construe the adoption statutes strictly, since they were in derogation of the rights of the natural heirs at common law. No presumptions were indulged in favor of the jurisdiction of a court of limited powers, and, whore the record failed to show a finding of fact required by the adoption statute, the defect was regarded as a jurisdictional one, available to the next of kin of the adoptive parent in a collateral proceeding. Morris v. Dooley (1894) 59 Ark. 483, 28 S. W. 30, 430; Ferguson v. Jones (1888) 17 Or. 204, 3 L. R. A. 620, 11 Am. St. Rep. 808, 20 p. 842. Compare Coleman v. Coleman (1906) 81 Ark. 7, 98 S. W. 733, the holding of which is given infra. * * * The courts, however, have abandoned the view that the adoption statutes are to be construed strictly, as in derogation of common-law rights, since they are obviously not intended to supplement the rules of common law, but to make a complete change in the law. Consequently mere errors and irregularities in the decree of adoption, or in other parts of the record of the proceeding, are no longer considered to be jurisdictional defects, and a decree of adoption cannot be successfully attacked by a presumptive heir in a collateral proceeding, except on the ground that, the court was without jurisdiction to render the decree.”

A large number of cases from many States are cited in support of the annotator’s statement that adoption statutes are not to be strictly construed and that courts are abandoning- the policy of so doing’.

The opinion in the case of Avery v. Avery, 160 Ark. 375, 255 S. W. 18, would indicate that this court had come to. that view, for it was there held (to quote a headnote) that, “where the record in adoption proceedings recites that the natural father of the child appeared in open court and petitioned for the child to be adopted by himself, and the mother, by affidavit filed in court, assented to the adoption, whereupon the order was made, a substantial compliance with Crawford & Moses’ Digest, § 256, is shown.” See, also White v. Dotter, 73 Ark. 130, 83 S. W. 1052.

The case of Van Matre v. Sankey, 148 Ill. 536, 36 N. E. 628, 23 L. R. A. 665, 39 Am. St. Rep. 196, which is itself a well-considered case, citing many authorities, is followed by an annotator’s note, covering many pages, citing many cases to the effect that adoption proceedings should he liberally construed in favor of the adopted child. Indeed, many of the authorities, including the Van Matre case itself, are to the effect that “neither an adopting parent, nor his heirs or representatives after his death, can question the validity of the order of adoption of a minor child procured at his instance and with his consent. ’ ’

The majority say they have not extended the Dooley case, but have only followed it; that the act dividing Mississippi County into two districts creates two probate courts, one for the Osceola District and the other for the Chickasawba District, and that these districts must bo treated, for all probate court purposes, as separate counties, and that the adoption proceedings must therefore be had before the court having jurisdiction of the district of the county in which the child resides.

This reasoning, carried to its logical conclusion, • would overrule the Dooley case. The whole theory of that case is that an adoption order is not a judgment of a "court of superior jurisdiction, but is a special statutory proceeding, and it is the jurisdiction of a court which the statute creating- Mississippi County parcels out to the two districts thereof.

One of the landmark oases in our jurisprudence is that of Borden v. State, 11 Ark. 519, 44 Am. Dec. 217. After there laying- down the rule, which has since been consistently f ollowed, declaring- the presumption of verity to be indulg-ed in favor of the judgments and decrees of superior courts, the learned judge who wrote that opinion said: ‘ ‘ The remaining question before us in this case is whether or not the probate court is to be reg-arded as a superior court within the principles laid down. We answer emphatically that in our opinion it must be so considered. Because it is not only a court of record, but a constitutional court of fixed and permanent character invested with general .jurisdiction and plenary powers over the matters committed by law to its peculiar cognizance and open to review by appeal. There is abundant authority thus to hold as to this court, and if there was not, it would be a matter of serious public concern. Because, while in point of law it is equal, in point of fact it is a more important court to the people of this State than the circuit court. And this will be manifest at once when it is considered that it only requires a period of about forty years to pass every atom of property in the State real and personal and many choses in action through the ordeal of the probate court; while it is estimated that the whole would not be passed through the circuit court in an entire century. We feel freely warranted therefore, not only on the score of authority, but for cogent reasons of public policy, to fix this court upon the footing of superior courts. (McPherson v. Cunliff) 11 Serg. & Rawle (Pa.) 429 (14 Am. Dec. 642); (Kempe v. Kennedy) 5 Cranch. 173 (3 L. ed. 70); (Grignon v. Astor) 2 How. 340 (11 L. ed. 283); (Grant v. Raymond) 6 Pet. 220 (8 L. ed. 376).”

If, therefore, an adoption order is a. judgment to be rendered only by a court having jurisdiction as such of the territory apportioned to it, then it is the judgment of a superior court, for a probate court is a superior court, and its judgments are clothed with the presumption of regularity which renders them impervious to the collateral attack here made upon the judgment under review.

If, on the other hand, the order is merely a special proceeding had in the probate court, and the Dooley Case so holds, then the order contains all the recitals which the Dooley Caso held were essential. The surviving parent was a resident of Mississippi County, and the adoption order so recites, and the statute, under the strictest construction, requires nothing more, and the Dooley Case required nothing more because the residence of the sole surviving parent is the residence of the child.

I am of the opinion, therefore, that the order^ of adoption here under review has been construed too strictly ; that it is valid, and should be upheld.

I am authorized to say that Justices Kirby and Me-haffy concur in the views here expressed.


source: Caselaw Access Project

author: McHaney, J.

license: Public Domain

text:
    Sherman v. McIlroy Banking Company.
    Opinion delivered February 24, 1930.

      G. D. Atkinson, for appellant.

      George A. Hurst, for appellee.
   McHaney, J.

This was an action by appellee to foreclose two certain chattel mortgages given to secure two promissory notes, one of $11,000, dated March 17, 1927, and the other for $'2,000, dated September 23, 1927, which had been reduced by payments, the first to $2,090:69, and the second to $227.50 at the time suit was brought. The $11,000 was secured in addition to other collateral by chattel mortgage executed by appellant, M. J. Sherman, to Sherman’s, Inc., a corporation of Fayette-ville, Arkansas, of which said M. J. Sherman was president, and one L. H. Kempton was secretary and treasurer, which covered certain household furniture, fixtures and equipment. This mortgage was assigned to appellee on the date of the execution of the $11,000 note, the assignment being executed by Sherman’s, Inc., by L. H. Kemp-ton, secretary and treasurer, and was delivered to the appellee as additional security for the amount of said note. Appellants contended in the court below and contend here that the household goods covered by said mortgage belonged to appellant, Florence Sherman, and that she consented for her husband to mortgage them to Sherman’s, Inc., to give it additional credit standing, and it was furthermore contended that said Kempton had no authority as secretary to assign said mortgage to ap-pellee for the reason that he had sold his stock in the corporation, Sherman’s, Inc., on March 10, 1927, seven days before he made the assignment, and that it was done without the knowledge or consent of M. J. Sherman.

The chancery court overruled appellant’s contentions, and decreed a foreclosure and sale of the property.

In the decree of foreclosure a personal judgment was rendered against Sherman’s, Inc., for $'2,110.36, the balance due on the $11,000 note. This note was executed by Sherman’s, Inc., to appellee. It thereafter became insolvent and made an assignment for the benefit of the creditors, including appellee, and it accepted its pro rata share of the proceeds of the assets assigned for the benefit of the creditors. It is said that this constituted an accord and satisfaction of all personal liability of the corporation. But appellants are in no position to complain about the judgment against the corporation. Although it was served with process, it made no answer and has not appealed from the judgment of the court.

It is next said that the court erred in holding that the mortgage on the household goods was properly assigned to appellee as collateral security to the $11,000 note. We cannot agree with appellants in this regard. The proof shows that the mortgage was included in a long list of notes and accounts belonging to Sherman’s, Inc., and deposited by it with appellee as collateral security for the $11,000 note. This list of notes and accounts was prepared and signed by the officers of the corporation; the assignment being as follows: “Assignment, March 17, 1927. Sherman’s, Incorporated, a corporation, being organized under the laws of the State of Arkansas, for value received, hereby assign and transfer to the McTlroy Banking Company the following accounts and notes due said Sherman’s, Incorporated, viz., to secure money borrowed this date as evidenced by the note of said company in favor of Mcllroy Banking Company. Sherman’s, Inc., by M. ,T. Sherman, president. Attest: L. H. Kempton, secretary and treasurer.” Then follows six pages of transcript showing a long list of notes and accounts, and near the end of the list appears the mortgage in question of $2,000, the total amount, including said $2,000 being $11,775.89. All the notes and accounts were left with Mr. Kempton, secretary of Sherman’s, Inc., hut the hank took possession of the $2,000 chattel mortgage, and had Mr. Kempton assign it to the bank. We are therefore of the opinion that appellant M. J. Sherman knew that the $2,000' mortgage was assigned along with the other notes and accounts to appellee. At least, the chancellor’s finding in this regard is not against the preponderance of the evidence. While it appears that Kempton had sold his stock to •Sherman prior to the indorsement of the assignment on the mortgage to appellee, it appears also that he was continuing to act as secretary and treasurer of the corporation on March 17, 19'27, with the knowledge and consent of the president, as they both joined in the asr signment of the notes and accounts, including the mortgage in question on that date. We find no error, and the decree is affirmed.


author: Butler, J.

text:
    Motor Credit Company v. Smith.
    Opinion delivered February 24, 1930.

      Duty & Duty, for appellant.

      John Mayes, for appellee.
   Butler, J.

The facts in this case are not in dispute. The appellant became the owner of a conditional sales contract, under the terms of which title was retained in an automobile until the purchase price was paid. During the time the purchaser remained in possession of the car under his conditional sales contract, he bought certain casings and inner tubes to place on the car from the appellee, title to which was retained by the appellee until purchase price thereof should be paid. The purchaser made default in his payment on the purchase price of the car, and the appellant repossessed the same under the conditional sales contract, the casings and inner tubes in question being on the car at that time, and having been used for some time without being paid for.

The appellee brought an action in replevin for the casings and inner tubes in the court of justice of the peace. An appeal was taken from the judgment of that court to the circuit court, where the case was tried, and the court rendered judgment for $35 in favor of the appellee, from which judgment is this appeal.

The amount involved is small, but the principle is important. It is the contention of the appellant, that where personal property is sold under a conditional sales contract, as the automobile in question, and the buyer purchases and places accessories thereon, that such accessories so added to the -subject-matter of the conditional sale, becomes the property of the seller by “accession,” and, as between the party who furnishes the accessories and the seller of the automobile, the accessories become the property of the latter when the automobile is reclaimed for the non-payment of the purchase price.

Where such accessories become a component part of the chattel and so incorporated as to be incapable of separation without injury to the whole, they merge 'in the principal thing, and become the property of the owner. It might be said that ordinarily casings would become component parts of an automobile to which they are attached, where the rights of third persons do not intervene, and the cases cited by the appellant appear to support that view.

The case of Blackwood Tire Co. v. Auto Storage Co., 133 Tenn. 515, 182 S. W. 576, L. R. A. 1916E, 254, Ann. Cas. 1917C, 1168, held that where an automobile is sold, and title retained by the seller until the purchase price is paid, and the purchaser buys and attaches casings to the machine, and, in default of payment of the purchase price of the machine, it is retaken by the seller, such casings become a part of the machine by accession, and the purchaser of the machine cannot detach them from the same upon the seller retaking the machine for default in the payment of the purchase price. In that case, however, attention was called to the fact, that the seller of the parts had not retained title in them, and for that reason ,the writer of the opinion distinguished that case from the case of Clark v. Wells, 45 Vt. 4. The other cases cited by the appellant, Baugham Auto Co. v. Emanuel, 137 Ga. 354, 735 E. 511, 38 L. R. A. (N. S.) 824, Small v. Robinson, 69 Me. 425, 31 Am. Rep. 299, and Shaw v. Webb, 131 Tenn. 173, 174 S. W. 273, L. R. 1915 D, 1141, Ann. Cas. 1916 A, 626, are cases holding the title of a seller of an automobile under conditional sales contract is superior to the lien of a mechanic for repairs made. We think an 'analysis of those cases shows that they have no application to the facts in the instant case.

The appellant also relies upon § 6874 of Crawford & Moses’ Digest for a reversal of this case. By § 6866 of Crawford & Moses’ Digest a mechanic, making repairs-upon an automobile, is given a laborer’s.lien, and sellers of parts are likewise given a lien in tbe nature of a materialman’s lien. By § 6874, supra, these liens are made subject to that of a vendor of an automobile retaining title for balance of purchase money due thereon. This section can have no application in the instant ease, because there is no question of liens involved, the question being which, if either, of two sellers of chattels, both retaining title for payment of the purchase price, shall be preferred to the other. The cases of this court cited by the appellant, Corning Motors Co. v. White, 173 Ark. 144, 293 S. W. 46, and Lowe Auto Co. v. Winkler, 127 Ark. 433, 191 S. W. 927, merely construe and uphold the proviso in § 6874, supra, while the ease of Shelton v. Little Rock Auto Co., 103 Ark. 142, 146 S. W. 129, is not in point, as that is a case brought by a mechanic to enforce a lien for work done upon an automobile under an act prior to that of § 6866, supra, in which the court held that-the mechanic had no lien.

Berry, in his work on Automobiles, (6th ed.) vol. 2, § 1806, lays down the rule that “where the seller of an automobile under a contract of conditional sale retakes the automobile upon default of the buyer to keep the terms of the contract, he is entitled to any tires or other replacements which the purchaser placed on the machine while it was in his possession, provided the title to such parts passed to the purchaser when he acquired them. ’ ’

An application of the above rule was made in the •case of Clark v. Wells, 45 Vt. 4, 12 Am. Rep. 187, where one having possession of a stage coach, engaged a wheelwright to put new wheels and axles on the same, the title to such wheels and axles being retained by the wheelwright until the price thereof had been paid. ’ A third person purchased the stage coach and sought to hold the wheels and axles under the doctrine of accession, and in an action between him and the wheelwright the court held that the doctrine of accession did not apply for the reason that the seller of the wheels and axles had never parted •with title thereto.

We can see no difference in principle in the case last cited from that of the instant case, or why the rights of a seller under a conditional sales agreement should be different in chattels of one species than another. The reason in any case for the recovery of' the thing sold or its value is that the seller has not parted with the ownership. This right ought not to be defeated merely because the thing sold has been attached to another object, unless from the nature of its destined use and manner in which it is attached, a separation cannot be made without injury to such other object, or its remaining component parts.

This appears to the effect of the rule announced in Berry on Automobiles and in Clark v. Wells, supra, and which we approve.

Therefore, as casings and inner tubes can be detached from an automobile without injury to its remaining parts, the seller of such will not be defeated in an action for their recovery or value, title having been retained by him, and default of payment of purchase price having been made the ground that these articles have been affixed by the purchaser in the proper place upon an automobile, also purchased by him under a like contract as were the parts, and that such automobile had been repossessed by its conditional seller. Such being our conclusion, it follows that the judgment of the circuit court must be, and is hereby affirmed.


text:
    Gallaher v. Shockey.
    Opinion delivered February 24, 1930.

      W. il. Dunblasier and George W. Dodd, for appellant.

      Cravens & Cravens, for appellee.
   Butler, J.

The question presented in this case is unique, i. e., Does the natural mother of a child adopted by another, which child died before the execution of a will by the adopted parent, inherit the estate of the deceased adopted parent which the child would have inherited had she been living at the time of the execution of the will and the death of the testator, where no mention of such child is made in the will?

The facts are as follows: Mrs. F. M. Shaw, in October, 1906, adopted a little girl, Minnie Masina Early. In April, 1910, the child died, and in January, 1916, Mrs. Shaw made her will devising and bequeathing' her estate, both real and personal, to the appellee, Sallie Shockey, no mention being made in the will of her adopted child or of the mother or sister of said child. Annie Specht Early was the mother of Minnie Masina Early, and Lena Gállaher was the. daughter of Annie Specht Early, and the sister of Minnie Masina. In October, 1927, Mrs. Shaw died, without ever having' had any children born to her. After the death of Mrs. Shaw, Annie Specht Early conveyed to Lena Gallaher all her right, title and interest in and to the estate of Mrs. F. M. Shaw, deceased, “which was inherited from said Minnie Masina,” and Lena Gal-laher thereupon filed her petition in the Sebastian Probate Court of the Fort Smith District, alleging* the above mentioned facts, and that she "was entitled to receive the distributive share of the estate which would have descended to Minnie Masina Shaw, if she was still surviving, “which interest is one-half of the estate left by the said F. M. Shaw, after payment of her funeral expenses and just debts.” From an order denying the prayer of the petition by the probate court and from a like order on appeal to the circuit court, this appeal is prosecuted.

The appellant, petitioner, for reversal of the judgment denying the prayer of the petition, relies on § 10507 of Crawford & Moses’ Digest, which is as follows: “When any person shall make his last will and testament, and omit to mention the name of a child, if living, or the legal representatives of such child ¡born and living at the time of the execution of such will, every such person, so far as regards such child, shall be deemed to have died intestate, and such child shall be entitled to such proportion, share and dividend of the estate, real and personal, of the testator as if he had died intestate.” The appellant cites the case of Branton v. Branton, 23 Ark. 576, as persuasive of the construction placed bv her on the statute, supra. This was a carefully considered case, in which the history of our statute and the decisions on similar statutes were reviewed, but we find no rule announced in the main case, or in any of the cases cited therein, which would sustain the construction urged upon us by the appellant. In the Branton case, while the interpretation of the statute here insisted upon by the appellant was not presented to the court, the plain inference is, from the language of the opinion, that no such interpretation would have been adopted, the court saying: “We see no principle in ilie statute but what is apparent upon its face, that it intended to provide for children and descendants that are not named in the will. The statute does not prohibit a man from disposing of his property according- to his own will. He may give his several children more or less than his wife, may give them much or little, or none of his estate; but the law will treat him as a father and a man in making a compulsory provision for Ms children, as in intestacy, unless he shall express a contrary intention towards every child and its children, by naming it, or them, in the will.”

To extend the word “representative” as used in the statute beyond the descendants of children living at the time of the execution of the will, in our opinion, would ¡be against its obvious meaning, when the qualifying words immediately following are given their ordinary interpretations. When the statute used the expression, “or the legal representatives of such child born and living at the time of the execution of such will, ’ ’ it unquestionably had reference to the issue born of such children. The purpose of the statute was to protect children and their descendants not mentioned in the will on the theory that such children were overlooked and their names accidentally omitted, and such statute could have no application, nor was it intended to have any application, to collateral heirs.

The judgment of the trial court denying the prayer of the petition of appellant is therefore affirmed.


author: Humphreys, J.

text:
    Early Stratton Company v. Cooper.
    Opinion delivered February 24, 1930.

      Berry, Berry & Berry, for appellants.

      8. V. Neely and B. V. Wheeler, for appellees.
   Humphreys, J.

Executions were issued out of the circuit court of Crittenden County upon judgments obtained in nine separate suits in favor of different plaintiffs against different defendants, and delivered to C. W. Cooper, sheriff of said county, on the date of issuance to be levied upon property of the defendant or defendants in each suit to collect the respective judgments.

Notices were served upon the sheriff that motions would be filed for summary judgments against him in each case of failure to make due return of the executions, and, pursuant to the notices, motions for summary judgments were filed in each ease in which it was alleged that he failed to return the executions, and that the indorse-ments made by the sheriff upon the back of each execution was insufficient to constitute a return within the meaning of the law. The purported returns (all identical) were as follows:

“On this.................day of..........................(giving date), 1928,1 have endeavored to serve the within execution, and, finding no personal property upon which to levy, and none being pointed out to me, and no indemnifying bond being furnished, I make this non est return.”

Special defenses, unnecessary to set out, were interposed in two of the cases by the sheriff. The important defenses (common to all the cases) interposed were that the defendant or defendants in each case owned no personal or real property in said county subject to execution ; and a denial that he failed to make a return in sixty days, and that the indorsements upon the executions were not ‘ ‘ due returns, ’ ’ such as were required by law.

Demurrers were filed by the plaintiff to the answers, and, by agreement, the series of actions were consolidated and proceeded to a hearing under the style of Early Stratton Company et al., plaintiffs, v. C. L. Goad et al., defendants, and C. W. Cooper, sheriff, respondent, upon the pleadings and upon the testimony theretofore introduced relative to the special defenses interposed in two of the cases.

The court overruled the demurrers to the answers. The plaintiffs then elected to stand upon their demurrers, whereupon the court dismissed each motion for a summary judgment, from which is this appeal.

< The demurrers to the answers admitted that the several defendants had no personal or real property in the county upon which the several executions could have been levied, and that the purported returns, evidenced by the writing on the back of the several executions, were returned within sixty days; but the contention for a reversal dismissing their respective motions for summary judgments is that the purported returns are insufficient to constitute returns within the meaning of § 6256, Crawford & Moses’ Digest, which provides as a penalty “for failing to return an execution the amount of the judgment on which it was issued, including all the costs and ten per centum thereon.” It is argued that the purported return refers to personal property only, and is an admission that the sheriff did not make any effort to find or levy the several executions upon real estate belonging to the several defendants. We cannot agree with appellants in their interpretations of the return. The sheriff closed his return with the following statement: “I make this non est return. ’ ’ He meant something by using this sentence. Ordinarily, executions like these do not operate on the person of a defendant, and by the use of “non est” he did not mean to say that the defendant or defendants were not to be found in the county. His purpose was cleai’ly to make a nulla bona return. The demurrers to the answers of the sheriff not only admitted that he made returns within sixty days, but that none of the defendants owned any personal or real property in the county upon which executions might be levied, and, further, that he-called upon the attorneys for plaintiffs for advice as to property owned by the defendants, upon which to levy the executions, but plaintiffs failed to point out any. In the light of these admissions, we construe the several returns on the executions as meaning that the sheriff was unable to find either personal or real property in the county, belonging' to the defendants, upon which to levy. The statute invoked as a basis for the motions for summary judgments is highly penal, and should be construed liberally in its application to the facts in a given case.

After the trial court overruled the several demurrers, the plaintiffs elected to stand'on their demurrers, so it was-proper for the court to dismiss their motions for summary judgments.

No error appearing, the judgments are affirmed.


author: Hart,-C. J.,

text:
    Wilson v. Wilkins.
    Opinion delivered March 3, 1930.

      II. G. May and A. F. Smith, for appellant.

      Evans & Evans, for appellee.
   Hart,-C. J.,

(after stating the facts). According to ■Blackstone, the- absolute rights of each individual are defined to be the right of personal security, the right of personal liberty, and the right of private property. 3 Cooley, Bl. Com. *119.

According to the allegations of the complaint and the testimony of appellee, there was a willful intimidation of his right of personal security and right of private property by causing him to leave his home by threats and intimidation. This was an actionable wrong. Counsel for appellants concede this to be true, but they seek a reversal of the judgment on the ground that the court erred in allowing plaintiff to recover for mental suffering which was unaccompanied by any physical injury. They rely upon the rule announced in St. L. I. M. & S. Rd. Co. v. Taylor, 84 Ark. 42, 104 S. W. 551, 13 L. R. A. (N. S.) 159, and other cases, where we have held, that, in actions for negligence, there can be no mental suffering where there has been no physical injury.

The rule is well settled in this State, but it has no application to willful and wanton wrongs, and those committed with the intention of causing mental distress and injured feelings. Mental suffering forms the proper element of damages in actions for willful and wanton wrongs and those committed with the intention of causing mental distress.

According to the evidence for appellee, the very object of the words spoken in the present case was to cause him mental anxiety and thereby compel him to leave his home and farm, and this was precisely what he said he did do. In the case at bar, the mental suffering was the result of the wrongful acts of appellants against ap-pellee; and, even though there was no physical injury, the courts generally hold that such mental suffering may be taken into consideration in assessing the damages for the wrong. In cases like this the mental suffering was the natural and proximate consequence of the willful wrong which was the basis of the action. Kline v. Kline, 158 Ind. 602, 64 N. E. 9, 58 L. R. A. 397; Spade v. Lynn & Boston Rd. Co., 168 Mass. 285, 47 N. E. 88, 38 L. R. A. 512; Davis v. Tacoma Railway & Power Co., 35 Wash. 203, 77 Pac. 209, 66 L. R. A. 802; Lonergan v. Small, 81 Kan. 48, 105 Pac. 27, 25 L. R. A. (N. S.) 976; 17 C. J. 831; and 8 R. C. L. 531.

This rule has been expressly recognized and applied by this court in Lyons v. Smith, 176 Ark. 728, 3 S. W. (2d) 982. In that case, plaintiff by threats and intimida.tion was prevented from growing and cultivating his land, and the court held that, the evidence having showed that a willful and wanton wrong had been committed against her, the trial court properly submitted the question of mental suffering, although it was unaccompanied by physical injury.

No other assignment of error is argued, and the judgment will be affirmed.


author: Hart, O. J.,

text:
    Lister v. First National Bank of Van Buren.
    Opinion delivered March 3, 1930.

      L. E. Lister, for appellant.

      E. L. Matlock, for appellee.
   Hart, O. J.,

(after stating the facts). There was no error committed by the trial court in finding for the plaintiff. The burden in the case was upon Lister to show the negligence of the plaintiff, as the collecting bank and the damages resulting to him therefrom. Bank of Keo v. Bank of Cabot, 173 Ark. 1008, 294 S. W. 49.

The undisputed evidence shows that the check was handled by the plaintiff as a collecting bank through its correspondents in the usual and customary way that checks handled for collection were handled by it and other banks. The plaintiff as the collecting bank, without any delay or negligence whatever, sent the checks to its correspondent bank which usually handles its Oklahoma business for collection. Then the check was handled without any negligence on the part of the correspondent bank, and was paid by the payee bank by a draft on another bank. This draft was presented in due course for collection; but, in the meantime, the First State Bank of Hartshorne, which was the payee hank, had failed; and the check given by it in payment of the draft in question was dishonored on that account.

Prior to the passage of the act of 1921, amending the act creating the establishment of a State Banking Department, it was held that a bank receiving a draft for collection merely is the agent of the drawer or forwarding bank, and could only receive money in payment unless otherwise directed. Darragh Company v. Goodman, 124 Ark. 532, 187 S. W. 673.

Since the passage of the act of 1921 (General Acts of 1921, p. 514, § 14), the collecting bank is only liable for the default or negligence of its correspondent bank. Farmers’ & Merchants’ Bank v. Ray, 170 Ark. 293, 280 S. W. 984; and Hicks Company, Ltd., v. Federal Reserve Bank of St. Louis, 174 Ark. 587, 296 S. W. 46.

In the latter case, it was expressly held that a correspondent bank, in forwarding checks sent to it for collection by the' depository bank, was not negligent in accepting from the bank on which the checks were drawn drafts instead of money, where in so doing it followed the banking custom and was without notice of the drawee bank’s insolvency.

In the case at bar, the undisputed evidence shows that, there was no notice on the part of the plaintiff or any of its correspondents that the bank on which the check was drawn was insolvent. The proof also shows that the check was handled in the usual and customary way, and, besides that, the deposit slip given for the check when it was deposited for collection showed on its face that the collecting bank would charge it back to the depositor if it was dishonored.

It follows that the judgment of the circuit court was correct, and it will be affirmed.


author: Hart, C. J.,

text:
    Union Saw Mill Company v. Agerton.
    Opinion delivered March 3, 1930.

      Gaughan, Sifford, Godwin $ Gaughan, for appellant.

      J. V. Spencer and Marsh, McKay Marlin, for ap-pellee.
   Hart, C. J.,

(after stating the facts). It is earnestly insisted that the judgment should be reversed because the evidence is not legally sufficient to support the verdict. In making this contention, counsel for the defendant insist that the timber was cut and removed within a reasonable' time by the defendant. The record shows that the defendant was the original owner of the land and conveyed it by warranty deed to Henry F. Murray on the 20th day of December, 1906. In the deed, the defendant reserved to itself the timber on the land, with the right of ingress and egress to its employees and teams to cut and remove the timber. The deed shows that the parties intended that the timber should be severed from the land, and no time was fixed therefor. In such cases the inference is that the timber shall be removed within a reasonable time. Earl v. Harris, 99 Ark. 112, 137 S. W. 806; Burbridge v. Arkansas Lumber Co., 118 Ark. 94, 204 S. W. 304; Young v. Cowan, 134 Ark. 539, 178 S. W. 304; Ozan-Graysonia Lumber Co. v. Swearingen, 168 Ark. 595, 271 S. W. 6; and Orr v. Southern Lumber Co., 170 Ark. 361, 279 S. W. 1013.

Subsequently, the plaintiff became the owner of the land and sued the defendant in trespass for cutting the timber from the land in the first part of 1928. The defendant admitted cutting the timber and hauling it from the land, but justified its action on the ground that the timber had been excepted from the grant when it conveyed the land; and, under the authorities above cited, it had a reasonable time within which to remove the timber. It also claimed that the time was not unreasonable when its plan of conducting its business was considered. What is a reasonable time depends upon circumstances, such as the quantity of timber, the character of it, facilities for marketing it, and all other facts and circumstances showing the conditions surrounding the parties at the time of the execution of the contract. In cases of dispute, this becomes a question of fact for the determination of the court or of the jury trying the case. This has become the settled rule of this court and has been applied in numerous cases according to the facts 'of each particular case. No two state of facts are precisely the same; and in cases where the jury is the trier of the facts, its verdict must be final on appeal if there is any substantial evidence to support it.

Tested by this rule, it cannot be said that there is no substantial evidence to base a verdict in favor of the plaintiff. The jury might have legally inferred from the evidence adduced by the plaintiff that it was convenient and practical for the defendant to have cut and removed the timber from the land when it established a spur track near it in the latter part of 1906, and kept it there for the ensuing two years. The record shows that the defendant kept a crew of men to cut and remove the timber from its lands, and that it took them but a few days to cut the timber in question. It employed private carriers to haul the timber from the land to its spur track, and the jury might have found that it could have done this equally as well when it established its first spur track near the land, as it could have done to have waited until the first of the year 1928 to do so. As we have already seen, the deed itself shows that severance of the timber from the soil was contemplated, and it became the duty of the defendant to cut and remove the timber within a reasonable time. Under all the facts and circumstances surrounding the transaction, we think the jury might legally infer that the defendant failed to cut and remove the timber within a reasonable time and had therefore forfeited its right thereto. The evidence for the plaintiff also justified the amount of damages found by the jury.

We find no reversible error in the record, and the judgment will therefore be affirmed.


author: ■Smith, J.

text:
    McGehee v. Cunningham.
    Opinion delivered March 3, 1930.

      Hardin $ Barton, for appellant.

      Cravens & Cravens, for appellee.
   ■Smith, J.

Appellee, plaintiff below, alleged as his cause of action against appellants, the breach of a written contract of employment, whereby he had been damaged in the sum of $1,200. The contract upon which suit was brought was preceded by a correspondence, which involved the exchange of a number of letters, and, while these letters cannot be considered for the purpose of altering or varying the terms of the written contract, they may be considered as showing the relative situations of the parties, and thus enable us to determine the meaning of the language employed by them in their written contract. Inter-Southern Life Ins. Co. v. Shutt, 175 Ark. 1161, 1 S. W. (2d) 801.

Appellee was a cotton buyer and classer, and was employed by appellants in that capacity to buy cotton for their account. One of the letters from appellants proposed a commission of fifty cents per bale, and expressed the opinion that a live man might buy as many as fifteen or twenty thousand bales of cotton in Oklahoma alone, and appellee’s operations were°'not to be limited to that State. Appellee replied that he was a married man with two children, and that his family was dependent upon him for support, and he would require an all-year contract at a guaranteed salary, payable monthly or semi-monthly, as well as the commission basis proposed- by appellants.

The parties, having apparently come to terms through their correspondence, met to consummate the contract of employment, and after some- discussion it was agreed that appellant should reduce the contract to writing, and appellee returned to his home in Oklahoma, and a few days later received the copies for his signature. The contract was signed, but it was agreed, in the correspondence relating' thereto subsequent to its execution, that these letters, which slightly amended the contract, should be construed as a part of it.

The relevant and material portions of the written contract are as follows: It was agreed that appellee, who was designated as the party of the first part, should buy cotton for appellants, designated as the party of the second part, in the Oklahoma City market and vicinity, but should buy ‘ ‘ only on limits, and under direction of the parties of the second part, ’ ’ and that, on all cotton bought and taken up by the party of the first part, he was to receive fifty cents per bale commission. There are certain provisions about the payment of telephone calls and telegrams, and other expenses, which need not be recited, and it was then provided as follows:

“Parties of the second part agree to advance to the party of the first part two hundred dollars ($200) per month during term of this contract — one hundred dollars ($100) of which is to be payable on the first of each month in advance, and one hundred dollars ($100) on the 15th, and to pay him balance commissions, if any, that have accrued at close of season. In addition to this advance of two hundred dollars per month, the parties of the second part agree to make further advances, if necessary, sufficient to cover telephone, telegraph and traveling expenses, whenever the party of the first part is going outside of the State of Oklahoma for the purpose of buying and/or taking up cotton; it being agreed and understood that such advances are only a loan to the party of the first part, and are to be paid back to the parties of the second part at the end of the season or before, if possible. It is mutually agreed and understood that the parties of the second part guarantee that the party of the first part will buy forty-eight hundred (4,800) bales during the term of this contract..

“It is further agreed that in the event that'either party is dissatisfied with this contract that they may terminate it by giving sixty days notice.

“Witness our hands this 14th day of July, 1928.”

In the letter amending or supplementing this contract these provisions appear:

“It is mutually agreed between us, that on any cotton that we buy and you take up, you are to receive the full commission of fifty cents (50c) per bale, but on any cotton that you buy and call upon us to take up, you are to receive twenty-five cents (25c) per bale. The other 25 cents is to go to us for the purpose of paying the expenses and time of the man who we might be required to send. In this event, bales bought will be considered half bales in the guarantee of forty-eight hundred.
“Fourth Paragraph. When you are called upon to go outside of Oklahoma to take up cotton or buy cotton, the expenses of the trip will be advanced to you by us, and are to be paid back to us out of excess commissions that you receive above the forty-eight hundred bales, if you do not receive any commissions above the forty-eight hundred bales then this expense is to be borne by us.”

On October 30th, appellants wrote appellee a letter, in which, after reciting; the unsatisfactory condition of the cotton business, closed with the following statement: “Unless something turns up between now and the first of January, we are going to close up shop until another season. This will be sixty days’ notice to you of cancellation of the contract. We hope that by the end of this time that, if you have not already secured-employment, that matters will shape themselves so that we can go on.”

In Ms reply to tills letter, appellee expressed Ms surprise and Ms unwillingness tc be dismissed, and requested a letter of recommendation, and received a reply thereto in which he was authorized to refer prospective employers to appellants, and was assured that, “We will say all that we can in your behalf, and nothing that will hurt you. ’ ’

After writing the letter of October 30th, appellants remitted to appellee three checks, each for a hundred dollars, and, on December 8th, wrote a letter enclosing a cheek for a hundred dollars, in which it was stated that, “We are enclosing our check for $100, which pays your salary up to January first, which is the- expiration of the sixty days’ notice that we gave you. This completes our agreement with you.” Upo.n receiving this letter appellee called appellants over the long distance telephone, but they declined to have any conversation with him. Appellee cashed the check, and at the expiration of the year brought this suit, and at the trial, from which this appeal comes, made proof of his inability to secure any other employment to minimize his damages. He had been paid $1,200. There was a verdict and judgment in his favor for the sum of $1,'200, from -which is this appeal.

The controlling instruction is one numbered 3, which was given over appellants’ objection, and which reads as follows: “You are instructed that the contract in evidence, and supplement thereto, means that the plaintiff, under the terms was entitled to a minimum compensation thereunder of fifty cents a bale on forty-eight hundred bales of cotton; and the fact that the .contract was terminated by the defendants did not deprive him of that right, and he would still be entitled to a minimum recovery of fifty cents a bale on forty-eight hundred bales of cotton, less the twelve hundred dollars which has been paid, unless precluded from doing so under other instructions. ’ ’

We think this instruction correctly construed the contract. The correspondence between the parties makes plain the fact that each was contracting with reference' to the ‘ ‘ cotton season, ’ ’ and the testimony shows that such contracts usually cover a year. It was contemplated that appellee might, buy as much as fifteen or twenty thousand bales of cotton, and it was guaranteed that he should be given the opportunity during the year to buy as much as forty-eight hundred bales, aud had he done so his commission would have been $2,400, which exactly pays the salary of $200 per month for a year. It is true the contract also provided that: “It is further agreed that in the event that either party is dissatisfied with this contract they may terminate it by giving sixty days’ notice.” This provision and the guaranty above referred to are apparently conflicting, and these provisions must be construed together to arrive at the intention of the parties when the contract was executed. It is also to be remembered that the contract was prepared by appellants, and it is a familiar rule of construction that for this reason it must, be construed most strongly in appellee’s favor, and, when so construed, we think the contract gave appellants the right to terminate the contract upon sixty days’ notice, but that action would not discharge the guaranty. It remained, and furnished the basis upon which the minimum salary should be computed. 'Now, while the sixty days’ notice of termination extinguished appellee’s right to buy cotton in excess of the forty-eight hundred bales, as he might otherwise have done, he had the right under his guaranty to buy that amount of cotton, because it was this guaranty which furnished the consideration inducing appellee to enter into the contract. If appellants had the right at any time, for any reason satisfactory to themselves, to discharge appellee, the guaranty becomes meaningless and worthless, but, as appellants wrote the contract, the guaranty contained in it. must be most strongly construed against them, and we, therefore, bold that, in the absence of a breach of the contract by appellee which justified its cancellation by appellants, the right to cancel vras subject to the guaranty, and its cancellation operated only to discharge appellants from any liability to pay commissions on any excess over forty-eight hundred hales — that number not having been bought! when the notice of cancellation was given.

It is also insisted that the notice of cancellation, and the letter of December 8th enclosing the last check in payment of the sixty days’ salary, constituted an accord and satisfaction, and that a verdict should have been directed in appellants’ favor for this reason.

Upon this question the court gave at appellants’ request an instruction numbered 4 which reads as follows: “You are further instructed, gentlemen of the jury, that if you find from a preponderance of the evidence that the defendants on the 8th day of December, 1928, paid the plaintiff by check the sum of $100, and that they did so with the expressed intention that this was settlement in full with the plaintiff,, and so advised the plaintiff a,f the time, and that the plaintiff accepted said check with knowledge that it was thus intended, then you are told that the plaintiff could not recover further in this case.”

It is insisted that the jury disregarded this instruction and, further, that a verdict should have been directed in appellants’ favor for the reason that the undisputed facts show that there was an accord and satisfaction.

We do not agree with counsel in this contention. Appellee denied that he had received the check in satisfaction of his demands under the contract. On the contrary, he contends that there was no controversy about the sum paid him. This was a liquidated demand payable in any event, and there was no controversy about the indebtedness which the last check paid. This check paid the salary up to January 1, 1928, and there was no controversy about it. The controversy was over the salary accruing thereafter, and nothing was paid on that account. The payment was upon an undisputed item, which was payable in any and at all events, and we think the court was correct in refusing to hold, a® a matter of law, that there had been an accord and satisfaction, and instruction numbered 4, set out above, was as favorable as appellants were entitled to have given on this subject. Johnson v. Aylor, 129 Ark. 82, 195 S. W. 4; Feldman v. Fox, 112 Ark. 223, 164 S. W. 766.

Appellants offered testimony tending to show that appellee had purchased cotton for their account which “fell short of the grades and staples for which they were bought by the plaintiff,” and the action of the court in refusing to admit this testimony is assigned as error.

There was no error in refusing to admit this ¿testimony, as the answer sets up no such defense, and no offer was made to so amend the answer as to present that question. The notice discharging appellee assigned no such reason, and the letter of recommendation herein-above referred to contained no intimation that such a contention would be made. The injection of this question into the case after the plaintiff had put on his testimony raised an issue which appellee had no reason to suppose he would be called upon to meet. The pleadings presented no such issue, and there was no -offer to so amend them as to raise it, and the testimony was properly excluded on that account. Under the circumstances stated we think there was no abuse of discretion calling for the reversal of the judgment, had the court refused to permit the answer to be amended to raise this question had a request been made for permission to amend. Butler v. Butler, 176 Ark. 126, 2 S. W. (2d) 63.

■Certain other questions are raised which we find it unnecessary to discuss, and, as no error appears, the judgment must be affirmed, and it is so ordered.


author: Smith, J.

text:
    Continental Casualty Company v. Baker.
    Opinion delivered March 3, 1930.

      Powell, Smead <& Knox, for appellant.

      Harry C. Steinberg and G. E. Snuggs, for appellee.
   Smith, J.

On January 21, 1927, tlie appellant insurance company, hereinafter referred to as the company, issued to appellee a sickness and accident insurance policy^ covering the year expiring January 20, 19:28. Under the terms of the policy appellee was indemnified against sickness or accident in the sum of $80 per month for such time as he should be unable to follow his usual avocation on account of sickness or accident, with double indemnify at the rate of $160 per month during such time as he should “be resident in a duly licensed hospital, said double indemnity not to exceed, however, a period of two months.”

Attached to the policy, and made a part thereof, was an agreement, referred to as a “rider” or a “paymaster ’s order,’’ which was directed, “To the paymaster of my employer,” which recited that the insured was employed as a freight conductor by' the Missouri Pacific Railroad Company, and had made application for the insurance, and that, “This order is given to provide for the payment of the premium thereon, which you are authorized and requested to deduct from my wages in ten installments as hereinafter designated, pay to the company for me, and charge against m37 pay account for services rendered or to be rendered, to my employer on whom this order is drawn.” This paymaster’s order, which was executed in duplicate, further directed that, “if for any reason whatever you fail to make deduction of any installment from the wages of the period hereinafter designated for that purpose, you are further authorized and requested at the option of the company to deduct and pay the defaulted installment from any of my subsequent wages. * * * The amount of my said premium is $77.60, and it is to bo deducted from my wages for the months here listed in ten installments as follows:

“(1) March, 1927 .$7.75
“(2) April, 1927 . 7.75
“(3) May, 1927. 7.75
“(4) June, 1927 . 7.75
“ (5) July, 1927 . 7.75
“(6) August, 1927 . 7.75
“(7) September,' 1927 . 7.75
“(8) October, 1927 . 7.75
“(9) November, 1927 .*.. 7.75
“(10) December, 1927 . 7.80”

It appears, therefore, that no part of the premium, which was payable in ten equal installments, was due until March, 1927, when the first! installment was payable. But before that time, to-wit: on February 22, 1927, the insured became ill and totally disabled because of an abscess on his lungs, and was thereafter confined in the hospitals of the railroad company, which were duly licensed hospitals, until the latter part of June, 1927.

Proof of this illness was made, and in satisfaction of its admitted liability therefor the company made payments as follows:

On March 28, 1927.$ 80.00
On April 22, 1927. 100.00
On May 21, 1927. 100.00
On July 18, 1927. 232.00

On the reverse of the check for $232 was written the following receipt: “Received of .the Continental Casualty Company $512 in full compromise, payment, satisfaction, discharge and release of any and all claims that I myself, my heirs, executors, administrators, assigns or beneficiaries now have or may hereafter have against said company, under policy numbered 6,321,637 for or on account of injuries or illness sustained by me on or about 2-18-27, and any loss that may hereafter result from said injuries or illness.” This receipt was signed by appellee, the insured.

Appellee ivas discharged from the hospital on June 26,1927, and on July 1 resumed work, but in the capacity of brakeman on a passenger train, at $5 per day, and this employment continued up to and including the 11th day of July, when he sustained, a relapse and again became totally disabled, and on July 14 was readmitted to one of the railroad company’s hospitals where he remained for about four or five months, and his disability continued until January 5,1928, and this suit was brought to recover for this period of time.

At the conclusion of all the testimony each side asked a directed verdict, and neither side asked any other instructions, and a verdict was directed for the plaintiff for the amount sued for. Therefore, under our practice the case will be treated as having been heard by ,the court sitting as a jury, and the judgment rendered.pursuant to the instruction so given will be affirmed if the testimony, viewed in its most favorable light, is sufficient to support the judgment.

When appellee sent in the last proof of his first illness in the latter part of June, 1927, he wrote a letter to the company directing that the amount of all unpaid installments or premiums be deducted from the amount of the indemnity then due him, but when the check therefor came dated July 18,1927, this had not been done, and the check was for the full amount of indemnity which had not been paid, with no deductions for the past due and unpaid installments of premium for the months of March, April, May and June. The July installment was then due, but was not delinquent.

It is the insistence of the company that the receipt signed by the insured, set ou,t! above, was a full acquittance of all liability that had then accrued under the policy, and that there was no subsequent liability there*for, for the reason that default had been made in the payment! of the installments of premium, the policy providing that it should be void if these installments were not paid.

We think the court below was correct in holding* that the receipt which appellee signed was not intended to and did not cancel the policy, but was a mere acquittance of all demands for indemnity under the policy for the. first illness and. disability, and that the policy continued in force as a subsisting contract of insurance unless it had forfeited on account of the nonpayment of the premium. Whether this had occurred is the real question in the case.

It will be remembered that, before the last remittance was made by the company in the discharge of the liability for the first illness, direction had been given to the company to deduct the installments of premiums then due and unpaid. The company would have had the right to do this in the absence of direction from the insured, but it did not do so, and it could not treat the policy as having forfeited for the nonpayment of installments of premium while it had it in its own hands a much larger amount of money than was required to pay the installments. It is so held in the following cases: Security Life Ins. Co. v. Matthews, 178 Ark. 775, 12 S. W. (2d) 865: Pfeiffer v. Missouri State Life Ins. Co., 174 Ark. 783, 297 S. W. 847, 54 A. L. R. 600; Knights of Pythias v. Sanders, 174 Ark. 279, 295 S. W. 25; Missouri State Life Ins. Co. v. Miller, 163 Ark. 480, 260 S. W. 705; Mutual Life Ins. Co. v. Henley, 125 Ark. 372, 188 S. W. 829; American Nat. Ins. Co. v. Mooney, 111 Ark. 514, 164 S. W. 276; Union Central Life Ins. Co. v. Caldwell, 68 Ark. 505, 58 S. W. 355.

It is also to be remembered that the company had in its possession when the last remittance was made an order on the paymaster of the railroad company for so much of appellee’s salary as was necessary to pay all installments of premium then due, and, as he had worked eleven days at $5 per day, there was due him from the railroad company more money than was required to pay the installments of premium then due. The company, therefore, had no right to cancel the policy while it held this order, which was in effect an assignment pro tanto of his salary.

Now, it is true, as the company insists, that on the 28th or 29th of July the railroad company remitted to appellee the whole amount of his wages earned in the month of July, all of which he kept, hut- it is not to he assumed from this fact that the paymaster’s order would not have been honored had it been presented. Moreover, it is also true that, before this payment was made by the railroad company of the July wages, appellee had been disabled by sickness from and including the 12th day of July, and had been resident in a licensed hospital from and including the 11th day of July, so that there had accrued to him, before the railroad company paid him his wages, out of which the insurance company had the right and was under the duty to collect the premium, an amount of insurance indemnity exceeding the installments of premium then due.

We conclude therefore that the court below was warranted in finding that appellee was never in default in the payment of his installments of premium, and that' the policy did not lapse, and the judgment must therefore be affirmed, and it is so ordered.


text:
    Fort Smith-Van Buren Bridge District v. Johnson.
    Opinion delivered March 3, 1930.

      J. B. McDonough, for appellant.

      Kill, F-itzhugh $ Brizzolara and Warner $ Wamor, for appellees.
   Humphreys, J.

Appellant, a bridge improvement district, brought suit against the collector of its revenues and the American Surety Company, which made his bond, in the circuit court of Sebastian County, Fort Smith District, to recover an alleged shortage of $1,250.67 in the collector’s account with it. The complaint alleged that, before the collector entered upon his duties and obligations to collect the assessment of benefits in the district from the property owners therein, he was required to give a bond in the sum of $10,000, which was made by his co-appellee, American Surety Company of New York, the material part of which is as follows:

“We, William Dewey Johnson, as principal and the American Surety Company of New York, as surety, hind ourselves to pay Fort Smith & Yan Burén Bridge District, Forth Smith, Arkansas, as obligee, such pecuniary loss, not exceeding ten thousand and no/TOO dollars, as the latter shall have sustained of money or other personal property by any act or acts of fraud, dishonesty, forgery, theft, embezzlement, wrongful abstraction, or willful misapplication on the part of the principal, directly or through connivance with others, while holding the position of collector in the service of the obligee.”

The complaint alleged, as one of the grounds for a recovery against its collector that he collected $1,250.67 of its revenues which he failed and refused to turn over to it on December 29, 1927, at the time same became due.

The complaint also alleged as a ground for recovery against both its collector and his surety on the bond, the appellees herein, that its collector willfully misapplied said money.

Appellees filed separate answers to the complaint denying the alleged shortage in the accounts, the willful misapplication of the revenues collected, or the violation of any of the terms or conditions of the surety bond sued upon. In addition to these denials, the American Surety Company said that, if the collector, its co-appellee, failed to account to appellant for the sum of $1,250.67, ,or any other sum or amount whatsoever, such failure was due solely to the fact that said sum of money was stolen from the office of appellant, and without the knowledge or consent of Johnson, the collector, and that it was not obligated under the terms of the bond for moneys or property stolen, embezzled, wrongfully abstracted or willfully misapplied by third persons, without the knowledge and consent of the said Johnson, and without his connivance therein.

The cause was submitted to the jury upon the testimony adduced by the respective parties on conflicting evidence as to whether there was a shortage; if sc, whether tlie fund was willfully misapplied by Johnson, the collector, or whether stolen by a third party under the theory that the bond sued upon was strictly a fidelity bond, and not a statutory bond, and that, in order for appellant to recover from either or both of the appellees for a shortage in the accounts of its collector, it must appear from the weight of the testimony that the shortage resulted from fraudulent or dishonest acts of appellant’s collector. The jurymen were told by the trial court that the bond sued upon only covered loss of funds through fraudulent or dishonest acts of appellee, Johnson, and if they believed, from the evidence in the case, that some person or persons, other than Johnson, stole the funds of appellant, they should return a verdict for appellees.

The trial of the cause resulted in a verdict and judgment for appellees, from which is this appeal.

As far as the American Surety Company is concerned, the only important question presented for determination on this appeal, is whether the bond sued upon indemnified appellant against a loss or shortage in the account of its collector in any event, or whether the indemnity was restricted to a shortage or loss in his accounts due to a willful misapplication of the funds by him,. Appellant contends that the trial court erred in restricting the indemnity to the terms of the bond because the statute creating the district provided for a bond to be given by the collector, “conditioned that they will faithfully discharge the duties of their office, and account for and pay over all moneys that come into their hands, according to law, and the order of the commission” ; and that this condition shall be read into the bond, whether written therein or not. The doctrine relative to indemnity bonds in this State, as announced in the cases of Union Indemnity Co. v. Covington, 178 Ark. 533, 12 S. W. (2d) 884, and the Fidelity & Deposit Company of Maryland v. Crane Company, 178 Ark. 676, 12 S. W. (2d) 872, 874, is that where the statute requires the giving of such bonds the conditions contained in the statute will not be read into the bond, where “the bond does not contain any covenant showing that it was intended to be executed in obedience to the provisions of the statute, but, on the other hand, expressly negatives that idea.” In the instant case the obligations in the bond expressly negative the idea that it was intended as a statutory bond. It would do violence to the language of the bond itself to construe it as a statutory bond, for the provisions of the bond neg- • ative any such construction.

Appellant also contends for a reversal of the judgment because the burden of proof was cast upon it by the trial court, in the instructions to the jury, to show that the shortage, if any, was a willful misapplication of the fund. In answering the American Surety Company not only denied the allegations of the complaint that the shortage was due to a willful misapplication of the funds by the collector, but stated that if there was a shortage it was due to the fact that the amount was stolen by a' third party. Appellant argues that the statement to the effect that it was stolen by a third party constituted an affirmative defense and shifted the burden to appellee on that issue, but we think not. It amounted to a denial of a misapplication in a more definite way than it had done in its general denial of the misapplication of the funds by Johnson. We think it was a negative defense, and did not shift the burden of proof to the American Surety Company. The burden still rested upon appellant to show a willful misapplication of the funds under the terms of the bond.

Appellant also contends for a reversal of the judgment on the ground that the court erroneously permitted appellant to cross-examine Houston J. Payne touching the proportion of cash in checks received by him in the collection of the revenues of the Sebastian Bridge District. Houston J. Payne officed in the same room with William Dewey Johnson, and both were collectors of the revenues of separate bridge districts covering the same territory. Houston J. Payne was called by appellant as a witness to show the conditions and circumstances surrounding the alleged theft, and the cross-questions were directed to an ascertainment, if possible, of the amount stolen in cash from Johnson in the absence of both during the lunch hour. We think this testimony a circumstance material to a determination of whether there was a shortage, and whether and how much of it resulted from the theft of a third party.

We think, however, that the allegation in the complaint is broad enough to cover any shortage that may exist in the accounts of the collector from him personally under his statutory or common-law liability. He cannot escape from his statutory or common-law liability to account for all the funds that came into his hands, because he furnished a bond to the district restricting his liability in the bond to fraudulent or dishonest acts on his part. He was personally responsible to the district for all the funds collected by him, irrespective of the terms of his bond. The trial court erred, therefore, in restricting his liability to the terms of his bond in submitting- the case to the jury. As far as he is concerned, the cause should have been submitted to the jury upon the theory that if there was a shortage he was responsible in dollars and cents for the amount thereof.

The cause will therefore be affirmed as to the American Surety Company and reversed as to William Dewey Johnson, and as to him remanded for a new trial.

Mr. Justice Kirby dissents.


text:
    J. W. Myers Commission Company v. Fruit Production Company.
    Opinion delivered March 3, 1930.

      D. II. Howell, for appellant.

      Starbird $ Starbird, for appellee.
   Humphreys, J.

The only question involved on this appeal is whether appellant was entitled to recover 15 per cent, as commissions on the g-ross proceeds of a car of apples, which he retailed in the market for appellee, instead of ten cents per box, the amount he did recover; and a determination of this question depends upon the proper construction of a letter written to appellee by appellant before the car of apples was shipped, received and sold. It was admitted that the car of apples was consigned to, and sold by, appellant, under authority of the following letter:

“Van Burén, Arkansas,
“ September 23, 1927.
“Mr. J. M. Hughes,
£ £ Cashmere, Washington.
“Dear Sir: We have your letter of September 20, and certainly glad to hear from you, as our trade here are going to be interested in western apples.
“Upon receipt of this, I would be glad if you would drop me a wire stating what size you can ship, and the price, and I am sure that we can turn you some business. I don’t know just what to say in regard to the fourth-class apples, as 1 don’t know just what they will look like.. If you can get a line on hulk apples, especially Delicious, get in touch with us, and it might be well for you to express us a sample of these fourth-class apples. We certainly expect to turn you all our western apple business, and will also expect you to take care of us on our wants in this territory. I know that your apples will sell well if you keep your quality, and pack up to what you have been shipping down this way in past seasons. I note in the first of your letter that you are getting ready to ship some of your fine fruit down this way. In this, I know that you can’t go wrong because, if we can’t get the price' that we want for them on arrival here, I can arrange for them to go on storage and draw money on them.
“For your information, all the cheap, apples will be gone from here in a very few days. I have close to five thousand bushels of ordinary Ben Davis on storage that I expect to sell around $2.50 per bushel later in the season.
“Let me hear from you at once-, as I think we have a chance to make some money on your apples this year, and remember that I will sell them for you in car lots for $25 brokerage, or break the cars at 10c per box, or, if you prefer it, I will work joint account with you. Very truly yours,
“ J. W. Myers Commission Co., by J. W. Myers.”

Mr. J. M. Hughes, to whom the letter was addressed, was, and is, the representative of appellee.

The car of apples had been shipped into several markets, same having been diverted from one point to another on account of congestion. After they arrived in Dallas, Texas, where there was no sale for them, on advice of appellant they were diverted and shipped to him to be sold on the Little Rock market, but, finding no sale for them in Little Rock, he shipped them to Van Burén, Arkansas, without first advising appellee; broke the car and sold them in job lots. Subsequently he rendered an account of the car showing gross sales to the amount of $956.70, from which he deducted freight and cold storage charges and expenses for repacking, and 15 per cent, commission in the total sum of $883, leaving a balance of $73.46 due appellee for this car of apples, which it refused to accept, contending that appellant was entitled to ten cents a box as commissions for selling the apples, instead of 15 per cent.

This suit followed resulting in a verdict and judgment in favor of appellee for $1'67.36, instead of the amount appellant tendered it.

In submitting the cause to the jury the trial court construed the letter contract, set out above, as meaning that appellant would retail or sell in job lots all apples consigned by appellee to Mm for sale irrespective of class or grade, for a commission of ten cents a box. Appellant contends that this was an erroneous construction of tbe contract, because the commission named in the letter was only intended to apply to Mgh-grade or fancy apples and not to apples in class C or fourth-grade apples. The government inspection showed that they were C grade apples.

The letter is general and refers to all classes of apples mentioned therein. Nothing was said in the letter about charging a larger commission for selling one grade or class of apples than another. In fact, the letter says nothing about the commission until the last paragraph. The attention of appellee was then called in that paragraph to the fact and appellee was asked to remember that appellant would sell the apples in carload lots for $25 brokerage, or break the cars for ten cents per box. This commission charge clearly referred to any kind of apples which appellee might ship to appellant. The trial court properly construed the contract.

. The judgment is affirmed.