text:
    State ex rel. Attorney General v. Fidelity & Deposit Company of Maryland.
    4-2979
    Opinion delivered March 6, 1933.

      Hal L. Norwood, Attorney General and Walter L. Pope, Assistant, for appellant.

      Rose, Hemingway, Cantrell & Loughborough, Duty & Duty and Daily & Woods, for appellees.
   Smith, J.

Separate suits were filed by the State, on the relation of the Attorney General, against C. S. Christian, W. W. Mitchell and Claude Duty. The members of the State Highway Commission and the surety upon the separate bonds of the commissioners were made parties to each of these suits. There is some confusion as to the record in the case, as the cases were consolidated for the purpose of trial. Answers were filed by all of the defendants, to which the State demurred, but the demurrers were overruled only as to the answers filed by the commissioners and their surety. The State elected to stand upon the demurrers which had been overruled, and the causes were dismissed as to the highway commissioners and their surety, and this appeal is from that judgment. The trial court does not appear to have disposed of the demurrers to the answers of Christian, Mitchell and Duty, and the causes of action against these defendants are still pending in the court below, although a brief was filed by Duty on the question of his liability, and we were thus led to believe that the question of liability of all the defendants was before us for decision, and we proceeded to decide it. As the causes against Duty and Christian and Mitchell are not before us, we withdraw the opinion as originally handed down and limit our decision to the liability of the commissioners and their surety.

The complaints alleged that Christian, who was the State Highway Engineer, and Mitchell, who was a district highway engineer, and Duty who was an Assistant Attorney General of the State, had each been paid certain sums of money as “living expenses,” in excess of their lawful salaries, and that these payments were made under the authority and direction of the members of the State Highway Commission, which action by the Commission was unauthorized by law and was in violation of the official duties of the'Commissioners. Upon this allegation the Commissioners and the surety upon the official bond of each Commissioner were made party defendants in each suit.

The answers admit that certain sums of money were paid to Christian, Mitchell and Duty in excess of their fixed salaries, but alleged that this excess was paid by way of expenses, to retain their services, upon the assumption by the Commission that they possessed this authority.

The essential allegations of the pleadings are to the following effect: Christian resided in Texarkana, Mitchell in Fort Smith, and Duty in Rogers. These men were first employed — all of them — at salaries authorized by law, but they represented to the Commission that they could not continue the discharge of their respective duties unless they were allowed their living expenses in Little Rock. It was the unanimous opinion of the Highway Commission that the increased compensation demanded did not exceed the value of the services being rendered and thereafter to be rendered, but the question of the power of the Commission under the law to make the allowance arose, and a written request was submitted to H. W. Applegate, then the Attorney General of the State, for an opinion on the subject. A written opinion was rendered by the Attorney General’s office in response to this request, which was signed “H. W. Applegate, Attorney General, By Claude Duty, Assistant Attorney General.” After a short review of the question, the opinion concluded with the statement that: “It is clearly my opinion that such action as mentioned in your letter is within the powers' and within the legal rights of the Highway Commission to do, and you are. so advised. ’ ’

Thereafter the Highway Commission directed the payment monthly, to each of the three employees, of a sum equal to the estimated living expenses of such employees, while resident in Little Rock. This was in addition to their traveling expenses while engaged in the discharge of their respective duties. The right and power to pay the actual and necessary traveling expenses in the discharge of official duties is not questioned. The question for decision is the right to pay “living expenses in Little Rock,” and the liability of the respective parties for an unauthorized payment on that account.

The payments of money complained of covered the period of time from July 1, 1927, when the first payment was made to Mr. Christian, to September 30, 1932, when the last payment was made to Mr. Duty, and the power of the Highway Commission during this period of time in the respect indicated is limited and defined by the following acts of the General Assembly: act 11 of the Acts of 1927, page 17; act 18 of the Acts of 1929, page 2G; act 28 of the Acts of 1931, page 7i8.

Section 10 of act 11 of 1927, which was in effect before any of the payments here questioned were made, makes an appropriation of $280,000 to pay, among other things, “the salaries and other pay of the highway engineers employed by the Commission, the salaries and other pay of such other employees of the Commission as the Commission may deem necessary.”

This act must however be read in connection with such portions of act 5 of the Acts of the Special Session of 1923 (Acts Special Session 1923, page 11) as were not repealed by the later act.

Two sections of the act of 1923 which must be considered in this connection are §§ 7 and 12. By § 7 it is provided that the Attorney General shall be the attorney for the State Highway Commission, and that, to assist that officer in the performance of his duties, he is authorized to employ an additional assistant, to be approved by the Highway Commission, at a salary of $2,400 per year. The defendant Duty served as Assistant Attorney General during the time covered by this litigation, and was acting in that capacity when he wrote the letter to the Highway Commission above referred to.

Section 12 of act 5 of 1923 authorizes the employment of a State Highway Engineer at a salary of $5,000 per year, and that: ‘ ‘ The salaries of the other engineers and employees shall be fixed by the State Highway Commission, but no salaries shall exceed $4,000 a year. ’ ’ By subsequent legislation the salary of the Assistant Attorney General was increased to $3,600.

By § 5 of act 18 of the Acts of 1929, ’the sum of $300,000 was appropriated to pay “all expenses of the office of the State Highway Department, expenses of the members of the Highway Commission, the salaries and expenses of the highway engineers employed by the Commission, and the salaries and expenses of such other employees of the Highway Commission as the Commission may deem necessary.”

By act 28 of the Acts of 1931- (Acts 1931, page 78), there was appropriated the sum of $275,000 to pay, among other items, “the salaries and expenses of highway engineers employed by the Commission, and the salaries and expenses of such other employees of the Highway Commission as the Commission may deem necessary. ’ ’

Christian, Mitchell and Duty were each paid the full amount of the salaries allowed by law, and these salaries are not questioned. The question is what expenses may be paid in addition to the salaries.

It is our opinion that the answer to this question is that the expenses contemplated by the statutes quoted are those only which were necessary and were actually incurred in the discharge of the duties of the respective employees, and that there was no authority to pay “living expenses” of any employee, as distinguished from the necessary and actual expenses incurred in the discharge of their duties. We therefore conclude that the Attorney General was in error in the opinion furnished the Highway Commission to the effect that the salaries might be supplemented by the payment of “living expenses,” in addition to the salaries, and we are of this opinion notwithstanding the allegation of the answers, which the demurrers admit, that the services of these employees, or of others equally efficient, could not otherwise have been obtained.

The law conferred no authority to pay anything more than the salaries provided by law and the expenses necessarily incident to the discharge of the duties of the defendants, Christian, Mitchell and Duty.

It does not follow however that the Commissioners are liable for- the erroneous payments. As to them the question of their liability may be stated as follows: Shall a member of a public commission be held liable for a mere mistake or error of judgment in voting to pay certain expenses of employees, whom the Commission was authorized to employ, when the member in so voting acted not only honestly and in perfect good faith, but, indeed, under the written advice of the very attorney selected by the State to advise him?

The answers alleged, and the demurrérs admitted, the good faith of the Commissioners. The law did not require that the members of the Highway Commission be learned in the law, and the answers alleged that none of them were lawyers. They were all called from other walks of life, and, in order that they might be advised as to their duties and as to the limitations upon their authority and powers, a law officer was designated to act as their adviser. They did not act until they had sought this advice, and the action taken accorded with the advice given. It is not contended that the Highway Commissioners acted wilfully, maliciously or corruptly; nor is it contended that they derived any profit or benefit personally from the advice asked and given.

It is not contended, on behalf of the Commissioners, that the erroneous opinion of the Attorney General changed the law or increased their power. It is contended however that the opinion of the Attorney General, through his deputy should be considered in connection with, the undenied allegations of the answers, that the Commissioners acted in good faith, and that they personally derived no profit or advantage from their action.

Counsel cite many cases defining the conditions under which members of official boards and commissions are responsible for misappropriation of public funds. We do not review these cases, as the rule already adopted in this State conforms to the rule in force in most, if not all, other jurisdictions.

The case of Hendrix v. Morris, 134 Ark. 358, 203 S. W. 1008, is typical of many other cases cited. In that case the facts were that a board of school directors, without authority of law, had purchased and operated an automobile truck for the purpose of carrying children to and from school. It was held in Hendrix v. Morris, 127 Ark. 222, 191 S. W. 949, the opinion being delivered January 29, 1917, that the directors had no authority to expend school, money for this purpose. ■ After the rendition of this opinion, suit was brought against the directors to recover the money thus expended, but it was held, to quote a headnote in Hendrix v. Morris, 134 Ark. 358, 202 S. W. 1008, that: “WTiere school directors act in good faith, believing at the time that they have authority under the statutes to expend money for the purposes 'for which they issue warrants, they will not be liable to the district individually for money so expended, even though they have no such authority.”

In that case we quoted from Sanborn v. Neal, 4 Minn. 140, the following statement of the law: “As is said by the Supreme Court of Minnesota, ‘Were the rule otherwise, few persons of responsibility would be found willing to serve the public in that large capacity of offices, which requires a sacrifice of time and perhaps money, but affords neither honor nor profit to the incumbent’.”

We also said in this case of Hendrix v. Morris, 134 Ark. 358, 203 S. W. 1008, supra, that, “while it is alleged and admitted that the directors had no authority to issue the warrants for the purpose mentioned, there is no allegation that they acted wilfully or maliciously. This is essential in order to make the directors personally liable.”

The case of National Surety Co. v. Miller, 155 Miss. 115, 124 Sou. 251, is a well-considered one, which reviews the legal principles here involved. The facts there were that the board of commissioners of a levee district let a contract to construct a levee, and later amended the contract to provide for increased compensation to the contractor. It was there held that this action was, not only not allowed by law, but was prohibited by the Constitution of the State, yet it was also held that, as the members of the board had acted within the- scope of their general jurisdiction and in good faith, without fraud or corruption, they were not individually liable for the increased compensation which they had unlawfully paid. It was there said: “Equally is it to be said that when we create boards and commissions and invest them with high duties and powers towards the accomplishment of great public objects, if we are to subject them to actionable liability for errors of decision and judgment and cast their estates in ruin, although they acted within their jurisdiction and in good faith, we will have only insolvents in office, or else those who will be so fearful of disaster to their private fortunes and the safety of their families that the rule of their conduct will be that of nonaction or of action so feeble and halting and cautious, their performances so paralytic of the vigor of decision, that they would become little more than objects of commiseration and at last of contempt.”

The case of Russell v. Tate, 52 Ark. 541, 13 S. W. 130, is cited as sustaining the opposite view. The facts there were that the mayor and council of the then town of Russellville appropriated a thousand dollars of the town’s funds to build a county courthouse, and certain taxpayers of the town brought suit to enjoin the payment of this money, and to recover the part thereof already paid out. The relief prayed was granted, but, in granting the relief the court said: “As against the liability of these defendants, it is contended that a city council being in some sort a legislative body, its members are not liable for the erroneous exercise of their discretion in voting upon measures before them. This is true. [Citing cases.] But where, after exercising their discretion in voting $1,000 of the money of the town, to pay an obligation which they and a few others had bound themselves to discharge, they or their building committee took the money, it was a conversion of trust funds, for which each of them, as also the mayor who ordered, and the treasurer who made, the payment, are liable.” [Citing cases.]

It will be observed that the principle upon which the liability was sustained was not for the authorization of the appropriation, but for the subsequent conversion of the money appropriated. In the instant case there is no contention that the Commissioners converted or received any of the money which they had ordered paid without authority. Had this been done, the case of Russell v. Tate would apply.

As to the liability of the surety upon the bonds of the Commissioners, but little need be said. The execution of the bond added nothing to the liability of the Commissioners, as the purpose of the bond was to insure the faithful performance of the official duties of the Commissioners, and no official act of theirs would constitute a breach of the bond unless such act would, without a bond, amount to a breach of official duty. ' The principal not being liable, the surety cannot be held.

It follows, therefore, that the demurrers to the answers of the Commissioners and their surety were properly overruled, and the judgment dismissing the suits against them is affirmed.


source: Caselaw Access Project

author: Kirby, J.,

license: Public Domain

text:
    Dugan v. Browne.
    4-2870
    Opinion delivered March 13, 1933.

      George P. Whittington and Cooper B. Land, for appellant.

      Walter J. Hebert and G. Floyd Huff, for appellee.
   Kirby, J.,

(after stating the facts). Appellant insists first that the court erred in not giving her requested instruction No. 1, which would have submitted the only question in the case to the jury. The undisputed testimony shows that appellee leased the premises that they had been occupying for some time before the leases were executed; that they executed the leases, and, after some time occupancy of the premises thereunder, under conditions about as theretofore under their monthly occupancy, they and each of them, without giving notice of any complaint or claim of forfeiture because of failure to furnish service that they regarded themselves entitled to under the terms of the leases, abandoned and vacated the premises and took offices in the new building upon its completion which they had contracted for before the execution of the leases to appellant. If there was such a failure upon the part of the lessor to furnish the service as agreed to be. furnished in the leases as would have warranted forfeiture, appellant would have had the right to notice of such claim and a reasonable opportunity to remedy or repair the condition before appellees would have been justified in abandoning and vacating the building. The failure, if any, to furnish the service agreed to be furnished was not shown to have been complete at any time, nor sufficient to prevent the continued occupancy of the offices, but at most to render some of them occasionally uncomfortable for only a short time; most of the tenants who complained on account of it being able to supply the service needed at a very small outlay of expense — a negligible amount as compared with the rent reserved and to be paid. Under such circumstances, according to the undisputed proof, the tenants should have furnished or procured the service and taken credit therefor oh the rent account, and were not warranted in abandoning the premises because of any such claim of failure. In other words, the testimony does not show any substantial failure upon the lessor’s part to furnish the services agreed to be furnished in the leases as would have warranted the abandonment of the premises by the tenants under a claim of forfeiture. Ashmore v. Hays, 159 Ark. 234, 252 S. W. 11. See also Tedstrom v. Puddephatt, 99 Ark. 193, 137 S. W. 816; Williams v. Shaver, 100 Ark. 565, 140 S. W. 740.

The said requested instruction No. 1 not only should have been given, but No. 9 as well. In fact, the appellees admitted the execution of-the leases and occupancy of the premises and their vacation thereof before the expiration of the time stipulated without payment of the rent, attempting to justify their conduct by a claim of forfeiture of said leases because of the default of the landlord in supplying the service agreed to be furnished under their terms. The testimony introduced in support of the claim of forfeiture and justification of the tenants’ vacation of the premises was insufficient to establish the right thereto, and the court would have been warranted in directing a verdict in favor of appellant.

The judgment herein will be reversed, and the cause remanded for a new trial. It is so ordered.


author: Smith, J.

text:
    Beloate v. State ex rel. Attorney General.
    4-2824
    Opinion delivered March 13, 1933.

      W. E. Beloate, for appellant.

      R. C. Waldron and E. H. Tharp, for appellee.
   Smith, J.

The Attorney General commenced this suit under act 296 of the Acts of the General Assembly of 1929 (page 1235), to confirm the State’s title to certain lands which had forfeited to it for the nonpayment of the taxes due thereon. The complaint described a certain forty-acre tract of land, which was alleged to have been sold in 1928 for the 1927 taxes.

W. E. Beloate, Jr., filed an answer, alleging his ownership of the forty-acre tract referred to, and a cross-complaint, in which Arthur Friar was made a cross-defendant, which pleading alleged that Friar had taken possession of the land under a donation certificate from the State based upon said sale for taxes.

It was alleged that the tax sale was void for the following reasons: (1) That the county court clerk, upon delivering the tax books to the tax collector, failed to attach a warrant to collect the tases as provided by § 10,016, Crawford & Moses’ Digest; (2) that the collector failed to file a delinquent list as required by § 10,082, Crawford & Moses’ Digest, on or prior to the second Monday in May, 1928; and (3) the clerk failed to post a delinquent list in his office as required by § 10,084, Crawford & Moses’ Digest.

A demurrer and motion to dismiss was filed by Friar, upon the ground that Beloate, the cross-complainant, “had never, at any time, tendered him any sum whatever for the amount of taxes paid, nor any sum for any improvements made, and the complaint does not so state. ’ ’

There was no amendment to the cross-complaint to meet the allegations of the demurrer and motion to dismiss, which was sustained by the court and the cross-complaint was dismissed.

For the reversal of the decree of the court below it is insisted that cross-complainant was not required to comply with the provisions of § 3708, Crawford & Moses’ Digest, by making tendor of taxes paid and improvements made, and was not, therefore, required to make that showing. This section reads as follows: “No person shall maintain an action for the recovery of any lands, or for the possession thereof, against any person who may hold snch lands by virtue of a purchase thereof at a sale by the collector, or Commissioner of State Lands, for the nonpayment of taxes, or who may have purchased the same from the State by virtue of any act providing for the sale of lands forfeited to the State for the nonpayment of taxes, or who may hold such lands under a donation deed from the State, unless the person so claiming such lands shall, before the issuing of any writ, file in the office of the clerk of the court in which suit is brought an affidavit setting forth that such claimant hath tendered to the person holding such lands in the manner aforesaid, his agent or legal representative, the amount of taxes and costs first paid for such lands, with interest thereon from the date of payment thereof, and the amount of taxes paid thereon by the purchaser subsequent to such sale, with interest thereon, and the value of all improvements made on such lands by the purchaser, his heirs, assigns or tenants, after the expiration of the period allowed for the redemption of lands sold for taxes, and, that the same hath been refused.”

This statute was construed in the case of Anthony v. Manlove, 53 Ark. 423, 14 S. W. 624, where it was referred to as § 2649, Mansfield’s Digest, and Judge Hemingway, there speaking for the court, said of it that, “being penal in its nature, it should be strictly construed.” Being thus construed, the benefit of the statute may not be invoked by one in possession under a donation certificate merely, such as Friar held, but only by one, as applied to the facts of this case, “who may hold such lands under a donation deed from the State. ’ ’

The Legislature has thus made a distinction between the holder of a certificate of donation and one who holds a donation deed. The reason for the distinction is, no doubt, that the holder of a donation certificate may never sufficiently comply with the requirements of the law to be entitled to a deed, by living upon the land in a house habitable at all seasons- of the year, and by making- proof of his improvements, etc. But, whatever may have been the reason, the statute does not require a tender of the taxes and costs for which the land sold, nor of the value of the improvements made, to one in possession under a donation certificate. The original owner may therefore bring suit to cancel a void tax sale and the donation certificate based thereon without being required to make a tender of the taxes and the value of the improvements, and the court therefore was in error in dismissing the cross-complaint for failure to allege such tender.

If the cross-complainant shall establish the allegation that the tax sale was void, the court would, no doubt, ascertain the value of any improvements made upon the land by the donee by virtue of his certificate of donation under § 10,120, Crawford & Moses’ Digest, and require the payment thereof as a condition upon which a writ of possession might issue. This section provides that for improvements made after two years from the date of the tax sale “the purchaser shall be allowed the full cash value of such improvements, and the same shall be a charge upon the land.” This section has been construed to give the tax purchaser the right to make improvements without exacting the showing of belief in the integrity of his title which is required by the Betterment Act. Bender v. Bean, 52 Ark. 132, 12 S. W. 180, 241.

The decree of the court below is therefore erroneous, and the cause will be remanded with directions to overrule the demurrer and motion to dismiss the cross-complaint.


text:
    Gross v. Hoback.
    4-2901
    Opinion delivered March 20, 1933.

      W. O. Young, W. D. Mauck and J. T. McGill, for appellant.

      Duty & Duty, for appellee.
   Smith, J.

Mrs. Maude Hoback brought this suit in the Benton Chancery Court against the administrator and heirs at law of John R. Gross, deceased, for the purpose of having her title established and declared to certain personal property which she alleged Mr. Gross had given her. The property consisted of $10,100 in United States bonds, a time deposit in the Benton County National Bank of $6,090, and a checking account in the same bank of $129.65, and two promissory notes payable to the order of Mr. Gross, one for $1,510, the other for $100. The court found that this property had been given to Mrs. Hoback by Mr. Gross, and from a decree based on that finding is this appeal.

The testimony in the case is to the following effect; Mr. Gross removed to this State from Tennessee many years ago, and was followed later by J. T. Grimsley, a nephew. No other relative removed to this State.

Mrs. Hoback testified that her mother gave her to Mr. Gross three days before her mother died, and that she was one year old on the date of her mother’s death. This little orphan grew up in the home of Mr. and Mrs. Gross, who called her “daughter,” and she called them “papa” and “mamma,” and lived with them as their child until her marriage, although she was never legally adopted as a child.

Upon the death of Mrs. Gross, who died before her husband, Mrs. Hoback and her husband abandoned their own home and removed to the home of Mr. Gross, where they continued to reside until the death of the latter. Mr. Gross made out a list of the personal property above described, which he gave to Mrs. Hoback, in the. presence of his wife, stating at the time that he and Mrs. Gross desired her to have their property after both were dead. This list was made out about two years or more before Mr. Gross died. After Mrs. Hoback moved to the Gross home, Mr. Gross told her where his money and valuable papers were, and gave her, at the time, the key to his dresser drawer and the key to his lock box at the bank, and she retained these keys thereafter continuously. The government bonds were kept at the bank, but were not kept in the lock box. The cashier of the bank explained that they were kept in the vault of the bank in order that they might be insured.

There was a bill folder in the dresser drawer which contained the promissory notes and the bank’s receipt for the government bonds. There does not appear to have been any paper in the bill folder relating to the bank deposits.

Mr. Gross had been in good health prior to the day of his death, and had worked that day at a factory, coming home at the usual time. He became violently ill that night, and Mr. and Mrs. Morris, his nearest neighbors, were called in, and he said to Mr. Morris: “I have sent for you to tell you about my business. I don’t know what will happen to me before morning if this pain keeps on. I sent for you to tell who is to have my property.” He then said: “Everything I have got is Maude’s (Mrs. Hoback’s), including land, personal property, .notes and bonds, with the exception of $100, to go to Keith Grimsley,” his nephew, who later administered on his estate. Nothing was said about a will, but the witnesses to the statements of the dying man later reduced the statements to writing in an effort to establish a nuncupative will. This attempt was abandoned because the value of the property exceeded $500. Section 10,497, Crawford & Moses’ Digest.

It is insisted, however, that this testimony shows there had been no prior gift, as Mr. Gross was then apparently attempting to make an original disposition of his property, which would not have been necessary had he previously disposed of it. But this is not, in our opinion, the only inference, nor the proper one, to be adduced from the testimony of Mr. and Mrs. Morris, who had no interest whatever in the litigation. Mr. Gross was a man of limited business experience, otherwise he would have made a will on the night of his death, if not before, to carry into effect his steadfast purpose to give his “Daughter” all his property, except $100. We think the testimony of Mr. and Mrs. Morris confirms, rather than questions, the fact that the personal property had been already given to Mrs. Hoback.

Another circumstance, which it is insisted refutes the theory that the personal property had been given to Mrs. Hoback, is that Mrs. Hoback allowed the bill folder to remain in the dresser drawer until the administrator took charge of the bill folder and made an inventory of its contents. We think, however, that this circumstance, when viewed in its proper light, shows only the simplicity and honesty of these people. Mr. Grimsley, the nephew, became the administrator. As a nephew, he was one of the heirs, and his testimony against his own interest as an heir carries conviction. Mrs. Hoback knew the nature and value of the contents of the bill folder, but she left it undisturbed, although she had the key to the drawer which contained it until it had been inspected by the adr ministrator. Mr. Grimsley testified that his uncle told him frequently that he intended for Mrs. Hoback to have his property, and, while he made an inventory of the personal property as administrator, he stated his reasons for so doing as follows:

“Q. You knew at the time you took charge of it and inventoried it Maude Hoback was claiming it? A. Yes, sir; I knew she was the legal heir to it. Q. Why did you include it as a part of the assets of the estate? Why you inventoried it and took charge of it? A. In order that it could go to its rightful owner. Q. She told you herself and claimed the property as her own at the time, didn’t she ? A. I disremember the exact words that were said; it was something to that effect; the lawyer advised us that it would have to go through court, be an administrator appointed, before I could turn it over to her. Q. You knew she was claiming the property? A. Yes, sir. Q. You know Mr. Gross had told you some time previous he had given it to her? A. Yes, sir.”

Without further recitation of the testimony, it may be said that it appears certain that Mr. Gross intended that Mrs. Hoback should have all of his property, except the $100, and, if proof of this intention only were required, the case would be a very simple one, as Mr. Gross’ intention is established beyond question. But something more is required to make this intention effective, as the mere intention to make a gift does not suffice to pass title. There must be a delivery, actual or constructive, of the gift, so that the donor parts with, and the donee acquires, possession and title.

It must be confessed that the record before us presents a close question as to whether there was such a delivery as to pass title to the personal property described, but we have concluded that the testimony sustains the chancellor’s finding in this respect except as to the bank deposits. Mrs. Hoback testified, upon her cross-examination, that her father could have retaken this property had he wanted to, and that she would have made no question had he done so, but we understand from this testimony that she meant only to say that she would have permitted her father to retake the gift, but she did not concede that there had been no gift. It must be remembered that these were simple people, who evidently had no thought that the far-away heirs would question their actions. The only heir present or with whom they were in touch understood the transaction and does not question it. The bill folder contained the notes and the receipts for the bonds, and its possession was given to Mrs. Hoback when Mr. Gross delivered to her the key to the drawer in which it was contained, thus placing in her hands the means of obtaining possession of the gift and of excluding others from it.

We do not review the numerous cases cited by opposing counsel, as the law of the subject has been definitely settled by our own decisions. It must be remembered also that this was a transaction, not between strangers, but between an old man and a woman who regarded each other as father and daughter. A headnote to the case of Baker v. Applen, 181 Ark. 454, 26 S. W. (2d) 109, reads as follows: “The rule as to delivery of gifts is not so strictly applied to transactions between members of a family living in the same house, the law in such cases accepting as delivery acts which would not be so regarded if the transactions were between strangers living in different places; it not being required that the thing given should be removed from the common residence.”

The bill folder contained the notes and the receipt for the bonds, but it contained no muniment of title to the bank deposits. It does not appear whether Mr. Gross had a pass-book or deposit certificates covering his bank accounts, but, if so, they were not in the bill folder. We are therefore constrained to distinguish between the deposits and the other property. The distinction may appear somewhat artificial in view of our statement that the intention of Mr. Gross that Mrs. Hoback should have all his property was clearly established, but the distinction exists nevertheless. The intention to give is not sufficient; there must be a delivery to consummate the gift and to pass the title. There was such a delivery of all the personal property except the bank deposits, and, as to these, nothing passed from Mr. Gross to Mrs. Ho-back evidencing the title thereto.

That part of the decree relating to the bank deposits must be reversed, and the cause will be remanded with directions to the administrator to account to the heirs at law for the amount of the deposits. In other respects, the decree is affirmed.


author: Humphreys, J.

text:
    Cobb v. Franklin Fire Insurance Company of Philadelphia.
    4-2886
    Opinion delivered March 20, 1933.

      Horace Chamberlin, for appellant.

      Verne McMillen, for appellee.
   Humphreys, J.

Appellant brought suit against appellee in the circuit court of Pulaski County, Second Division, to recover $1,580 on account of damage caused by fire to a building owned by C. W. Greenwood and insured by appellee.

The gist of the complaint was to the effect that C. W. Greenwood and wife executed notes and a mortgage to secure same on the property for $3,500 to the Exchange Trust Company, agent, which notes and mortgage were assigned to appellant for a valuable consideration on June 9, 1931, at which time the property was insured ag’ainst loss by fire in favor of C. W. Greenwood and his mortgagee, as his interest might appear, in the sum of $3,000. The policy was obtained through the agency of Rightsell-Pearson-Collins-Barry-Donham, Inc., in the Southern Fire Insurance Company. When the policy expired on January 18,1932, said agency renewed the policy in appellee company, which it represented at the time, and charged the premium of $22.50 to C. W. Greenwood, who had a regular account with said agent. The renewal policy contained a mortgage clause providing that any loss thereunder should be paid.to Rightsell-Pearson-Collins-Barry-Donham, Inc., agents, and that appellee and said agency knew that appellant was the owner of the mortgage and placed the mortgage clause in the policy for appellant’s benefit. The policy also contained a provision that, in the event the owner of the property failed to pay any premium due on the policy, the mortgagee, on demand, should pay same. Appellee reserved the right in the policy to cancel same as to the mortgagee (appellant) if he failed to pay the premium after ten days’ notice of Greenwood’s failure to pay same. C. W. Greenwood failed to pay the premium, and on February 6,1932, said agency, without notice to appellant, the mortgagee, of Greenwood’s default, credited Greenwood’s account with the amount of the premium and canceled and returned the policy to appellee. On March 29, 1932, the property was damaged by fire to the amount of $1,580, and appellee refused to pay appellant the loss sustained, under the mortgage clause, and the prayer of the complaint is for judgment for said amount.

A demurrer was sustained to the complaint, and the complaint dismissed, from which is this appeal.

In sustaining the demurrer and dismissing the complaint, the trial court proceeded upon the theory that Rightsell-Pearson-Collins-Barry-Donham, Inc., was not only the agent of Greenwood and appellee for writing and canceling the policy, but was also the agent of appellant, mortgagee, for consenting to the cancellation.

This court ruled in Fireman’s Insurance Company v. Simmons, 180 Ark. 500, 22 S. W. (2d) 45, that, if an insured authorizes a fire insurance agent to insure his.property in any company the agent represents, the general authority thus conferred authorizes the agent to waive a cancellation notice and renew the insurance in another company for the insured. This rule, however, has no application to a mortgagee who conferred no such authority on the agent of the owner of the property. Without such an understanding, express or implied, between the mortgagee and the agent, the agent would have no authority to waive notice of cancellation of a policy to the insured and leave the mortgagee unprotected. Under the terms of the policy, the mortgagee was entitled to ten days’ notice of cancellation, so that he might pay the premium himself and continue the policy or obtain insurance elsewhere. According to the allegations of the complaint, he was not notified of the cancellation at all, although both the insured and its agent had knowledge that he (appellant) was the mortgagee.

On account of the error indicated, the judgment is reversed, and the cause is remanded with directions to overrule the demurrer and reinstate the complaint.

McHaney, J., dissents.


author: Humphreys, J. Smith, J.,

text:
    Western Union Telegraph Company v. Clark.
    4-2925
    Opinion delivered March 20, 1933.

      Francis B. Stark and Gaughan, Sifford, Godwin & Gaughan, for appellant.

      R. H. Peace and T. D. Wynne, for appellee.
   Humphreys, J.

This is an appeal from a .judgment for $1,000 recovered by appellee from appellant in the circuit court of Calhoun County as damages for appellant’s alleged negligence in failing to deliver a telegram to her in time for her to have attended her mother’s funeral. Appellee’s brother, D. Anderson, sent a telegram from appellant’s office in Pine Bluff between seven and eight o’clock on the morning of March 20, 1930, to appellee at Thornton, Arkansas, telling her that her mother was dead and would be buried the next morning at 11 o’clock at Mt. Carmel church. The message was directed to “Miss” Daisy Clark at Thornton, Arkansas, and signed D. Anderson. It was received by appellant’s agent, O. E. McGoogan, at 8:15 o’clock a. m. on the morning it was sent, but was never delivered to appellee, for whom it was intended. The message was addressed to “Miss” Daisy Clark. Mrs. Daisy Clark was a widow, and the only Daisy Clark in Thornton, which toAvn had a population of about 200 people. She lived 130 yards from appellant’s office. When the message arrived, Walter Davidson and a boy by the name of James Avere in the office, and Davidson testified that the agent inquired of him about Miss Dixie Clark, and that he informed the agent that she had been visiting the James family but had returned to her home in Carthage, and that “Mrs.” Daisy Clark lived about 130 steps from the station or office. The agent, McGfoogan, testified that he inquired of Walter Davidson and the James boy if either knew Miss Daisy Clark and Avas informed that she had been visiting the James family and had returned to Carthage, her home. The girl Avho had been visiting the James family Avas “Dixie” and not “Daisy” Clark. The agent made no further inquiry, but repeated the message to the Carthage office and received an answer that Daisy Clark could not be found; and, after notifying the Pine Bluff office that Miss Daisy Clark could not be found, he filed the message. Two Aveeks thereafter, Mrs. Daisy Clark received a letter informing her of her mother’s death and burial, together Avith the information that her brother had Avired the day of her mother’s death; whereupon she called on the agent at Thornton and received the message in a sealed envelope from him. The agent’s excuse fdr not delivering the telegram was because it was addressed to ‘ ‘ Miss ’ ’ instead of ‘ ‘ Mrs. ’ ’■ Daisy Clark. With reference to the address, Anderson testified that he called at the office of appellant in Pine Bluff and told Miss Scott, who was in charge of the office, that he wanted to send a telegram to Mrs. Daisy Clark at Thornton, stating- that her mother had died and would be buried the next day at Mt. Carmel church, and that she wrote the message on a blank, which he signed without reading it or knowing that she had directed it to “Miss” Daisy Clark. Miss Scott testified that she wrote the telegram at the request and under the direction of Mr. Anderson, and that she read it to him as written before he signed it. Lionel Robinson testified that he had worked in the postoffice seven years and had the agent inquired of him where Miss Daisy Clark lived, he would have directed him to Mrs. Daisy Clark. Over the objection and exception of appellant, the following question was propounded to Lionel Robinson and answered by him:

“Q. If the Western Union agent had gone to you at the postoffice inquiring for Miss Daisy Clark, could you have directed him to Mrs. Clark here? A. I don’t know whether I could have directed where she lived, but I knew her and knew her to be there.”

Mrs. Clark testified that she would have understood that a telegram directed to Miss Daisy Clark was intended for her, and that she would have received the message if it had been offered to her, and would have gone to the funeral had she received it. The testimony tended to show that, when she received the information that her mother had died and been buried without getting to see her and attend her funeral, she was greatly shocked and grieved, so much so that her nerves were shattered, resulting in a loss of weight and a general breakdown. That, after the breakdown, she lost her appetite and suffered from insomnia until she could not perform her household duties, and was compelled to send for her daughter to take care of her and attend to her business.

Over the general and specific objection of appellant, the court gave appellee’s requested instruction No. 1, and, over its general objection, gave appellee’s requested instruction No. 2. The specific objection to instruction No. 1 was that the undisputed testimony showed that the telegram was not addressed to appellee but was addressed to a “Miss” Daisy Clark, Thornton, Arkansas.

The general objection to instruction No. 2 was that it is inherently wrong.

Appellant contends for a reversal of the judgment on the ground that the undisputed testimony reflects that it was not guilty of any negligence. We cannot agree with learned counsel for appellant in their interpretation of the evidence. The mere fact that the telegram was directed to “Miss” instead of “Mrs.” Daisy Clark is no excuse for not making diligent inquiry as to the whereabouts of the party for whom the message was intended. Had he made inquiry at the postoffice, he would have been directed to Mrs. Daisy Clark, who was well known in the small town of Thornton, and who was the only Daisy Clark residing there. Wallace Davidson told the agent that Mrs. Daisy Clark lived only 130 steps from the telegraph office. He knew the importance of the message and should have gone to see if the message was intended for Mrs. Clark. The slight inquiry and effort made by the agent to deliver the telegram to the sendee for whom it was intended showed an indifference on his part rather than diligence, and clearly warranted the submission to the jury of the issue whether appellant exercised reasonable diligence to deliver the telegram to the party for whom it was intended. This court ruled in the case of Arkansas & La. Ry. Co. v. Stroud, 82 Ark. 117, 100 S. W. 760, that: “A mistake in one of the initials of the person to whom a telegram was sent did not excuse the telegraph company for failure to deliver the telegram, unless the mistake caused or contributed to the failure.” It cannot be said, as a matter of law under the evidence in the instant case, that the mistake in the use of “Miss” for “Mrs.” caused or contributed to the failure to deliver the message, had the agent exercised reasonable diligence. Again, it is a disputed question of fact as to whether the sender of the message or appellant’s agent at Pine Bluff made the mistake. We think the mistake wholly immaterial because delivery of the message could have been made, notwithstanding the mistake, had the agent exercised reasonable diligence in his search for the real sendee. 37 Cyc., p. 1673, and Arkansas cases cited therein in support of the rule.

Appellant also contends for a reversal of the judgment because the reverse side of the telegram required appellee to present a claim for her damages to appellant within sixty days after the message was received, which she failed to do. According to the record before us, this defense was not relied upon in the trial below and cannot be raised on appeal for the first time. Western Union Telegraph Co. v. Freeman, 121 Ark. 124, 180 S. W. 743.

Appellant also contends for a reversal of the judgment because the court allowed Lionel Bobinson, an employee at the postoffice, to testify that, had the agent of appellant made inquiry of him, he would have directed him to go to Mrs. Daisy Clark. We think the testimony admissible because the law required that the agent, in the exercise of reasonable diligence, should make inquiry as to the identity of the sendee. The most likely place he could have obtained this information was at the postoffice.

Appellant also contends for a reversal of the judgment because the court gave appellee’s requested instructions Nos. 1 and 2. Identical instructions were approved by this court in the case of Arkansas-Louisiana Ry. Co. v. Stroud, supra, the facts in the two cases being almost parallel.

Lastly, appellant contends for a reversal of the judgment because the verdict is excessive. According to the record, appellee was greatly shocked when she received information of the death and burial of her mother without an opportunity on her part to see her mother before she ivas buried and to attend the funeral. The shock was so intense that it shattered her nervous system to such an extent that she lost her appetite and her ability to sleep and to perform her household duties and attend to her business affairs. She Avas compelled, as a result of the shock, to send for her daughter to take care of her and attend to her business. Considering these results, we do not think $1,000 is an excessive verdict.

No error appearing, the .judgment is affirmed.

Mr. Justices Smith and McHaney dissent from the affirmance of the amount of the verdict.

Smith, J.,

(dissenting). The negligence of the telegraph company had nothing to do with the death of the plaintiff’s mother; indeed, the purpose of the telegram was to apprise the plaintiff of that fact. It cannot he, and is not, contended that the telegraph company should make compensation, in whole or in part, for the grief which plaintiff sustained on account of her mother’s death. The telegram, if promptly delivered, would have caused this anguish.

It may be assumed, and the jury no doubt found, that the plaintiff was not lacking in filial affection, and that her grief was augmented by the negligence of the telegraph company in failing to deliver the telegram promptly, as it should have done. But the plaintiff had not lived with her mother for many years, and had grown children of her own, and, as was said in the case of Western Union Telegraph Company v. Weniski, 84 Ark. 457, 106 S. W. 486, where the failure to deliver a telegram had caused a sister not to attend the funeral of her brother, her only deprivation, on account of the failure to deliver the telegram, was the melancholy pleasure of attending the funeral and the satisfaction of having fully discharged her duty to the dead. In that case the plaintiff, who was a sister of the deceased, was awarded judgment for $1,354, which the court said was so grossly excessive as to call for the reversal of the judgment, regardless of any other error in the proceedings.

In the case of Western Union Telegraph Co. v. Evans, 108 Ark. 39, 156 S. W. 424, the youngest child of a mother was deprived of the sad satisfaction of attending his mother’s funeral by the negligence of the telegraph company in failing to deliver a telegram which would have advised him of his mother’s death. A judgment for $3,000 was said to be so grossly excessive that it would be reversed unless a remittitur was entered reducing the judgment to $500.

In Western Union Telegraph Co. v. Rhine, 90 Ark. 57, 117 S. W. 1069, the negligent failure to promptly deliver a telegram deprived a mother of the opportunity to attend the funeral of her son, and a judgment for $750 was said to be so excessive that it would be reversed unless there was a remittitur of all sums in excess of $400.

After some diligence I have failed to find in our reports or in those of any other appellate court any case in which a judgment for a sum as large as the judgment here appealed from has been affirmed where the only element of damage was the deprivation of the opportunity to attend a funeral, and the majority cite no such case. It is impossible, of course, to measure with any degree of accuracy or certainty the suffering thus occasioned, but the damages awarded on that account should be fair and reasonable. There is absent any testimony upon which to base a verdict for punitive damages.

I think the verdict is excessive and that a remittitur should be ordered in some amount not less than $500.

Mr. Justice McHaney concurs in the views here expressed.


text:
    East St. Louis Cotton Oil Company v. Hutchins.
    4-3011
    Opinion delivered March 20, 1933.

      C. W. Norton, for petitioner.

      Jonas F. Dyson, for respondent.
   Kirby, J.,

(after stating- the facts). Petitioner insists the court was without jurisdiction to appoint receivers or administer or liquidate, the assets of the insolvent corporation of a class covered by the National Bankruptcy Act. Jurisdiction was invoked “by petition of creditors signed by respondent Dendy on behalf of himself and other creditors who might wish to join,” etc. It was alleged the corporation was insolvent, with a prayer that it be adjudged so, and the court took charge of the assets, administering same under the said insolvency statute of Arkansas.

“The insolvency laws of Arkansas were suspended by the Bankruptcy Act of Congress of July 1, 1898, * * * and since that date have remained and are now in abeyance, in so far as they relate to the same subject-matter and affect the same persons as the act of Congress, which is still in force.” Hickman v. Parlin-Orendorff Co., 88 Ark. 519, 115 S. W. 371. See also In re Weedman Stave Co., 199 Fed. 948, and Morgan v. State, 154 Ark. 273, 242 S. W. 384.

In International Shoe Co. v. Pinkus, 278 U. S. 260, 73 L. ed. 318, it was said:

“The question is whether, in the absence of proceedings under the Bankruptcy Act, -what was done in the chancery court protects the property in the hands of the receiver from seizure to pay the judgment held by plaintiff in error, ’ ’ and concluded: ‘ ‘ State laws governing distribution of property of insolvents for the payment of their debts and providing for.their discharge are superseded by the National Bankruptcy Act.” See also Remington on Bankruptcy, §§ 2106-7.

It follows that the court was proceeding to act without authority, the State insolvency .laws having been superseded and suspended, and its orders were void; and the writ of prohibition is granted prohibiting any further proceeding in the matter by the said court.


text:
    McDaniel v. Prairie County.
    4-2918
    Opinion delivered March 20, 1933.

      Craig & Craig, for appellant.

      Emmet Vaughan, for appellee.
   Kirby, J.,

(after stating the facts). The statute expressly allows restoration and reinstatement of a claim and order of the court thereon, §§ 8342-43, Crawford & Moses’ Digest.

The petition was sufficient, and was not only verified by affidavit of the petitioner, but was supported by affidavits of the former county judge, who made the allowance, the county clerk, who filed it, and the road overseer, under whose supervision and direction the work for which the claim was presented was done.

There is no question about notice, since the county appeared and resisted the proceeding, which was one, as already said, to restore and reinstate a lost order and claim and not to procure the allowance of a claim against the county in the regular course.

The court erred in sustaining the demurrer to the complaint upon the two counts as alleged, since, if the order of allowance were reinstated in conformity with the allegations of the petition, it would have the same force and effect and relate back and take effect from the time when the original allowance, judgment or decree was rendered. Id., § 8343.

Neither could the right to the reinstatement be defeated by any contention that the original claim was not itemized according to law, nor that the claim was barred under the provisions of the Constitution as set forth in Amendment No. 10 thereto, the claim as originally made having been duly allowed with no appeal therefrom.

As already said, this is not a proceeding to verify or collect the claim, in which such contention could have been made if the conditions warranted, but only to restore the record, the order of allowance of the claim long since properly made, the original claim as presented for such allowance, and their reinstatement upon the records of the court. Chicago Title & Abstract Co. v. Hagler Special School District, 178 Ark. 443, 12 S. W. (2d) 881; Williams v. Dawson, 185 Ark. 1190, 46 S. W. (2d) 634.

The court erred therefore in sustaining the demurrer and dismissing the complaint, and the judgment is reversed and the cause remanded with directions to overrule the demurrer and for further proceedings according to law.


author: Mehaffy, J.

text:
    Arkansas Power & Light Company v. West Memphis Power & Water Company.
    4-2858
    Opinion delivered March 20, 1933.

      Rose, Hemingway, Cantrell & Loughborough, J. W. House, C. H. Moses and W. H. Holmes, for appellant.

      Davis & Brownback, Alene Word and Chas. E. Sullenger, for appellee.
   Mehaffy, J.

The town of West Memphis was incorporated March 21, 1927, and on May 14, 1930, the town council of West Memphis passed an ordinance granting to Charles E. Sullenger, his heirs and assigns, the exclusive right and privilege to use the streets, alleys, avenues and public grounds of said town for the purpose of maintaining and operating a system of poles, wares, transformers and other appliances necessary for the distribution of electric current for lighting and furnishing power for manufacturing and other purposes for public and private use in said town for a term of thirty years, which franchise rights and privileges the said Sullenger, on that date, accepted.

Thereafter, on August 15, 1930, for a good and valuable consideration, Sullenger transferred and assigned all the franchise rights and privileges granted to him under said ordinance to the West Memphis Power & Water Company.

The West Memphis Power & Water Company constructed its system for electrical distribution, and was ready for operation on November 9, 1930. It has had at all times since that time sufficient power and equipment, and has been ready and willing to supply all necessary electrical current for the use of the inhabitants of said town, according • to the terms and provisions of said franchise.

The Arkansas Power & Light Company built its electrical lines prior to the granting of the ordinance above mentioned, and prior to the incorporation of the town of West Memphis.

The appellant claims the right to operate because of having constructed its poles and equipment under the authority of § 4043 of Crawford & Moses ’ Digest, which reads as follows: “Any corporation organized under the laws of this State for the purpose of generating, transmitting, and supplying electricity for public use may construct, operate and maintain such lines of wire, cables, poles, etc., necessary for the transmission of electricity along and over the public highways, and the streets of the cities and towns of the State or across or under the waters, and over any lands or public works belonging to the State, and on or over the lands of private individuals, and upon, along and parallel to any railroad or turnpike of this State, and on and over the bridges, trestles and structures of such railroads; and in constructing such dams as the corporation may be authorized to construct, for the purpose of generating electricity by water power, may flow the lands above such dams with backwater resulting from such construction. Provided, the ordinary use of such public highways, streets, works, railroads, bridges, trestles, or structures and turnpikes be not thereby obstructed, or the navigation of said waters impeded, and that just damages shall be paid to the owners of such lands, railroads and turnpikes; and provided, further, that the permission. of the proper municipal authorities shall be obtained for the use of such streets.”

The appellant contends that its contract with the State was violated by granting the ordinance to the appellee, and that the former decision of this court in Arkansas Power & Light Co. v. West Memphis Power & Water Co., 184 Ark. 206, 41 S. W. (2d) 755, recognizes the appellant’s right to continue its service in West Memphis.

We do not agree with appellant in this contention. The court said in that case: “By act of the General Assembly, supra, any corporation organized for the purpose of generating, transmitting and supplying electricity for public use was permitted to construct its lines over the public highways. Therefore appellant’s rights to the use of the highway running through the village stands upon a different footing to its occupancy of the streets. Appellant rightfully used the highway for the erection of its lines and was rightfully using it at the time the municipality was formed. The statute, however, did not give it, or any other company of like character, the exclusive privilege, but any other company incorporated for a similar purpose or as many as might be formed might use the same highway, the only limitation to such use with respect to the appellant being that occupancy ought not to be allowed to injure or interfere with the physical property of the appellant.”

We also said in that case: “When it entered on the streets of the village with its poles and other equipment, however, no right could be predicated on the statute.”

As declared in the above-mentioned case, the appellant had the right, and still has the right, to use the highway, but it acquired no other right under the statute. Even if the acceptance by the appellant by constructing its system along the highway amounted to a contract, it could not be extended beyond the right given under the statute, and that was the right over the-public highways and streets of cities and towns, but the act expressly provides that the permission of the proper municipal authorities shall be obtained for the use of such streets.

In other words, the State granted the right to all corporations like the appellant to use thé public highways outside of cities and towns, and to use the public highway within cities and towns after getting permission of the proper municipal authorities.

Appellant does not claim that it got permission from the municipal authorities, and it has no right under this statute to occupy the streets of West Memphis without first getting permission from the municipal authorities.

The appellant, not having secured permission of the authorities, West Memphis had a right to grant an exclusive franchise to the appellee. Crawford & Moses’ Digest, § 7492; Act of 1929, p. 1207; El Dorado v. Coats, 175 Ark. 289, 299 S. W. 355; Natural Gas & Fuel Corp. v. Norphlet Gas & Water Co., 173 Ark. 174, 294 S. W. 52.

It will he observed that the above authorities are to the effect that a franchise granted by a municipality to a corporation to furnish light and power, when accepted by the corporation, becomes a binding contract.

The appellant, however, contends that it was rightfully using the streets of West Memphis. It is true that it was rightfully using the highway through West Memphis, but it was not rightfully using the streets of the town after it became incorporated, because the statute expressly provides that it must get permission from the municipal authorities.

Appellant cites the State v. Iowa Telephone Co., 175 Iowa 607, 154 N. W. 678, Ann. Cas. 1917E, 539, and quotes at length from the opinion in this case. The Iowa case, however, is construing a State statute which expressly authorized persons to construct telephone or telegraph lines along the highways of the State and erect the necessary fixtures, and the court said: “Now, the primary question in the case is whether or not by the enactment of these laws, commencing with the act passed in the year 1888 and ending with those appearing in the Code of 1897, the Legislature intended thereby to forfeit the rights already acquired by a telephone company under § 13'24 of the Code of 1873, as amended by the acts of the nineteenth General Assembly, and to require such a company already occupying the streets and alleys of a city to secure through action of the city council and by a referendum vote the right to use the streets and alleys upon which it had already placed its poles and lines under specific authority from the Legislature; or was it the intent of the Legislature to authorize cities to regulate such companies as were already using the streets and alleys under the grant of the Legislature, and all others which might secure the right to so use the streets and alleys, by general and uniform legislation applicable to all, and to further provide that no franchise to use the streets and alleys should thereafter be granted, renewed, or extended, except upon a referendum vote of the people. It seems clear to us that the latter is the proper interpretation to be put upon these laws. It must be remembered that the franchise spoken of is not the general franchise of a corporation, domestic or otherwise, granted by a sovereign, but a franchise for the streets, alleys, etc., of the city. The latter the defendant had directly from the Legislature, and, as we have seen, it was perpetual in character, subject, if at all, to forfeiture by the Legislature itself. It did not need to be renewed or extended; and, having one already, no further grant was necessary.”

In Iowa, at the time the telephone company erected its poles and system, there was no provision for municipalities granting a franchise to such company, but the franchise was granted by the State of Iowa, and it included the right to operate on all public highways, which included streets of cities and towns in Iowa at that time. The only question in the Iowa case was whether the subsequent legislation forfeited the franchise of the telephone company.

We have no such question here. The Arkansas statute does not undertake to give the right to appellant and other companies to occupy the streets and alleys of incorporated towns, but expressly provides that the permission of municipal authorities shall be had in order to do that.

The Iowa case was by a divided court, and a dissenting opinion was written by Judge Weaver, which was concurred in by Judge Preston. However, the Iowa case is not applicable here because, under the Iowa statute, the Legislature granted the franchise, and not the municipality, and under our statute the municipality must grant the right.

The appellant states that another case directly in point is that of Iowa Telephone Company v. Keokuk, 226 Fed. 82. That case, however, was decided by the Federal District Court, and it was there stated that the Supreme Court of Iowa had passed directly upon the question, and that it was the duty of the Federal court to accept the decision of the highest court of the State as correctly interpreting the legislative will.

But, as we have already said, when these corporations secured from the State their rights to erect their systems, there was no provision in the Iowa statute to the effect that permission of the municipal authorities should be had. At that time municipalities in Iowa could not grant franchises, and the only authority was the Legislature. Therefore these authorities are not applicable.

If the appellant had a contract, as it claims, any ordinance of the town of West Memphis or a State statute that impaired the obligation of that contract would be void; but, if appellant has a contract with the State, which we do not decide, it is a contract that must be strictly construed, and, when so construed, its rights are necessarily limited to the public highways outside of municipalities.

The ordinance of the town of West Memphis does not, and cannot, interfere with appellant’s occupancy of the highway through the town of West Memphis, but its rights are confined to the highway passing through the town, and it would have no right to serve any persons in the town of West Memphis.

The ordinance, which was accepted by the appellee, thereby making a contract, gives the exclusive right to appellee, and to permit any other corporation to serve any part of the town of West Memphis would impair the obligation of the appellee’s contract.

It is contended, however, by the appellant, that it had occupied some of the territory of West Memphis prior to the incorporation of the town, and that the subsequent incorporation could not affect its rights. This contention is like the contention of parties when they establish plants and property outside of the corporate limits of a city and the city is thereafter extended so as to include the plant or property.

Appellant; of course, knew that the town of West Memphis might be incorporated, and, of course, it knew that, if so, it would have the right to grant franchises and grant permission to occupy its streets.

This court has said: “The case affords, perhaps, an example where a business established at a place remote from population is gradually surrounded and becomes part of a populous center, so that a business which formerly was not an interference with the rights of others has become so by the encroachment of the population. Under these circumstances, private rights must yield to the public good, and a court of equity will afford relief, even where a thing, originally harmless under certain circumstances, has become a nuisance under changed conditions.” Ft. Smith v. Western Hide & Fur Co., 153 Ark. 99, 237 S. W. 724; Bickley v. Morgan Utilities Co., 173 Ark. 1038, 294 S. W. 38.

The city of Little Eock passed an ordinance granting to telegraph companies the right to construct poles, etc. The Mackey Telegraph Company constructed poles within the corporate limits of the city of Little Eock and also a number of poles outside the city limits. The ordinance of the city provided for a tax of fifty cents for each pole, etc. Of course, it could not tax poles without the city limits. The limits of the city were thereafter extended, and the city sought to collect for poles that were in the city limits at the time, but when erected were outside the city limits. This court and the United States Supreme Court both held that, when the city limits were extended, it had authority under the ordinance to tax the poles that were originally outside the city limits.

There would seem to be no difference in property taken into a town or city by extending its limits and taking it in by incorporating the town. In either event, the property that had been constructed or erected prior to the extension or organization would not be within the corporate limits, and, after the extension or organization, would be.

It is next contended by the appellant that the town of West Memphis did not have power to grant an exclusive franchise that would have the effect of excluding the appellant from West Memphis. It secured no rights in West Memphis under the statute authorizing it to construct its lines, except to use the highway through the town, and it is not excluded or molested in this right. Whatever else it did in the town of West Memphis, except to use the highway, was unauthorized by the statute.

The next question is the question of damages. The trial court found that the appellant had furnished electricity to the inhabitants and consumers of the town of West Memphis after the date-of completion of appellee’s plant and distribution system. The amount of damages was ascertained by the court by taking evidence to show the amount of revenue received from the customers after appellee’s right under the ordinance accrued, and deduct-, ing from the amount of this revenue the amount it would cost to serve these inhabitants. The finding of the chancellor on this is not against the preponderance of the evidence.

We find no error, and the decree of the chancery court is affirmed.


author: McHaney, J.

text:
    Life & Casualty Insurance Company of Tennessee v. McCray.
    4-2929
    Opinion delivered March 20, 1933.

      Moreau P. Estes, for appellant.

      Hill, Fitzhugh & Brizzolara, for appellee.
   McHaney, J.

Appellee is the beneficiary named in a policy of insurance for $500 issued by appellant on the life of her husband, Jonas McCray, dated November 3, 1930, premiums being due and payable semi-annually on May 1 and November 1. The cash premium was paid, but the premium due May 1, 1931, was not paid when due nor within the grace period. The policy provided for a grace period of 30 days for the payment of any premium after the first ‘ ‘ during which time the insurance shall continue in force.” And further: “If any premium or installment of premium be not paid before the end of the period of grace, then this policy shall immediately cease and become void, ’ ’ etc. It further provided that ‘ ‘ This policy may be reinstated at any time after default in the payment of any premiums * * * upon production of evidence of insurability satisfactory to the company, the payment or reinstatement of any indebtedness to the company hereon, and the payment of overdue premiums, with interest at six per cent, per annum. ’ ’

The premium due May 1, 1931, not having been paid when due, nor within the period of grace, the policy lapsed, but on August 1,1931, same was reinstated. Thereafter, on May 10, 1932, more than one year from the date of the policy, but less than one year from the date of reinstatement, the insured Jonas McCray, committed suicide. The policy contained a suicide clause as follows : “If, within one year from the date of issue of this policy, the insured shall, Avhether sane or insane, die by his own hand, the liability of the company shall be limited to the amount of the premiums paid hereon.”

Proof of death was duly made and payment of the amount due under the policy demanded. Payment Avas refused, and this suit followed, which was tried before the court on an agreed statement of facts, substantially as above set forth, resulting in a .judgment against appellant for $500 with interest at 6 per cent, from May 20, 1932, 12 per cent, penalty and attorney’s fee of $100.for services in the circuit court, and an additional $100 for services in the Supreme Court, if appealed to that court.

The defense in the circuit court and in this court was and is that appellant was only liable for the premiums paid by the insured (for which amount it offered to confess judgment) for the reason, as it contends, that the clause against suicide within one year ran from the date of reinstatement of the policy, and not from the date of the policy itself. Appellant says: “If the clause began to run from the date of the original policy, the judgment of the lower court was correct.” We do not understand there was ever but one policy, and it bore date of November 3,1930. Certainly there was never but one policy issued by appellant to insured. It lapsed and became void after 30 days, from May 1, 1931, until August 1, 1931, during which time there was no insurance, but on the latter date the very same policy, not a new or different one, was reinstated by the payment of all delinquent premiums and furnishing evidence of insurability satisfactory to appellant. There is no room for the contention that any new or different contract or policy was in force after reinstatement. By agreement between the parties, a forfeiture of the policy was set aside, and the same contract was reinstated. No new policy was issued, and none contemplated. By the express terms of the policy, it is provided that: “If, within one year from the date of issue of this policy, the insured shall * * * die by his own hand, the liability of the company shall be limited to the amount of the premiums paid hereon. ’ ’ It does not provide that the company’s liability shall be thus limited if the insured shall die by his own hand within one year from the date of reinstatement, should the policy lapse. Time is to be reckoned “from the date of issue of this policy,” not from the date of reinstatement, nor from the date of any other policy. No doubt appellant could have so worded its policy, but it has not seen fit to do so. We see no ambiguity in the matter, but, if there were, under the settled rule of this court, we would be bound to construe the clause most strongly against appellant.

The reinstatement clause above set out was a part of the contract giving the right so to do to the insured and could not arbitrarily be refused by appellant, if said clause were complied with. Appellant can not, by reason thereof, engraft on the contract a new condition or otherwise restrict its liability by conditions not contained therein. New York Life Ins. Co. v. Adams, 151 Ark. 123, 235 S. W. 412; Security Life Ins. Co. v. Leeper, 171 Ark. 77, 284 S. W. 12; Equitable Life Assurance Soc. v. King, 178 Ark. 293, 10 S. W. (2d) 891.

In the Leeper case, supra, there was a lapse by reason of failure to pay a premium, but was reinstated on application made a few days later. The application for reinstatement recited an agreement that, “in the event of self-destruction, whether sane or insane, within one year from the date of approval by the company of this application for reinstatement, the amount payable as a death benefit under said policy shall be equal to two annual premiums on said policy, and no more. ’ ’ Leeper committed suicide within a year from the date of reinstatement, and the company defended on the ground of suicide. This court held that the case was ruled by the Adams case, supra, and said: “The only provision in the policy now before us with respect to suicide related to the period running from the date of the original policy, and, since the policy gave an absolute right of reinstatement upon terms which did not include a new contract with reference to suicide, appellant had no right to impose that additional feature upon the insured in procuring reinstatement. ’ ’ In the case now under consideration, the application for reinstatement, if one, was silent in this respect, but, even had it so provided, it would not be effectual to accomplish the purpose for which appellant contends in the absence of such a provision in the policy itself.

Appellant also contends that it should not be taxed with the penalty and attorney’s fee imposed by statute because it says it defended in good faith, the question involved not having been heretofore decided by this court. As we have already seen, the question litigated had been decided, but, assuming appellant defended in good faith, this does not excuse it from the plain provisions of the statute. Security Ins. Co. v. Smith, 183 Ark. 254, 35 S. W. (2d) 581; Mut. Life Ins. Co. v. Marsh, 185 Ark. 332, 47 S. W. (2d) 585, where we expressly refused to follow the Circuit Court of Appeals in Standard Acc. Ins. Co. v. Rossi, 35 Fed. (2d) 667, and Inter-Southern Life Ins. Co. v. McElroy, 38 Fed. (2d) 557. This question is now settled, and we decline to reconsider the matter.

Affirmed.


author: Butler, J.

text:
    Taylor v. Hildebrand Poster Advertising Company.
    4-2861
    Opinion delivered March 20, 1933.

      Sam Rorex, N. R. Hughes and Owens & Ehrman, for appellant.

      Gaughan, Sifford, Godwin & Gaughan, for appellee.
   Butler, J.

P. T. Hildebrand, prior to April 13, 1929, operated a bill posting business in Ouachita and Union counties. On that date a company, was incorporated, known as the Hildebrand Poster Advertising Company, the incorporators being P. T. Hildebrand, Mildred W. Hildebrand, his wife, and M. A. Welty. This corporation took over the business formerly operated by Hildebrand individually, but there was no change in the method of operation, and Hildebrand continued to conduct it as though it was his own, depositing all the moneys of the corporation in his personal hank account, and in every other way handling it as his private business, rather than as a separate and distinct entity.

On January 7, 1930, according to minutes found, a special meeting of the board of directors and a special meeting of the stockholders of the company were presumably held. At that time, according to the company’s stock book, the stockholders were as follows: M. A. "Welty, Mr. and Mrs. Hildebrand, J. W. Coan, and J. M. Barker. Both meetings show Mr. and Mrs. Hildebrand and J. W. Coan as the only stockholders present. The minutes of each meeting contain waiver of notice of the meeting and special consent thereto, and a space was left after the names of those signing as stockholders for additional signatures, but no others appear to have signed.

J. W. Coan testified that he was secretary of the company and recalled the meeting. On cross-examination, however, he testified that he did not attend the meeting*, but read the minutes as they were written on the hook.

At that purported meeting* a resolution was adopted authorizing* the issuance of $50,000 in bonds to be secured by a trust deed of all of the company’s property, and further empowering J. L. Marks & Company, Chicago brokers, to act as “exclusive fiscal agents for this corporation in issuing, disposing of and selling the aforesaid bonds.” None of these bonds were ever sold by Marks & Company or the Hildebrand Company. A deed of trust was executed on January 2'2, 1930, in pursuance of the plan. This deed of trust is very lengthy and names the First National Bank of Camden, Arkansas, as trustee, delegating to it the authority to authenticate the bonds issued thereunder, and placing upon it various responsibilities for the protection of the bondholders. This instrument was recorded on June 26, 1930, in Ouachita County, and on July 2, 1930, in Union County. Subsequent to the execution of this deed of trust an amendment more fully describing the property covered thereby was executed. This amendment was filed for record on the same date as the original deed of trust. In other words, the deed of trust was held off record until June 30, 1930, the date upon which the amendment was executed.

In the meantime, Hildebrand had been conducting the business of the corporation as though he owned it individually, and, in April of 1930, approached the American Exchange Trust Company of Little Bock for the purpose of making a loan for his company. The bank agreed to lend him $25,000 if he would give it a bill of sale to all the personal property of the company. In April, 1931, some of the stockholders filed a suit asking for the appointment of a receiver for the Hildebrand Poster Advertising Company, which petition the court granted. All of the petitioning stockholders had purchased their stock after the execution of the various instruments above described. There were however stockholders holding both common and preferred stock who were not present at the meeting authorizing the execution of the bonds and who did not sign any waiver of notice of the meeting. These stockholders were J. M. Barker, who owned 20 shares of common and 20 shares of preferred, and M. A. Welty, who owned 5 shares of common and 5 shares of preferred.

Sam Wilson, as special deputy bank commissioner, in charge of the American Exchange Trust Company, intervened and claimed the personal property under the bill of sale. The First National Bank intervened and set up the bond issue, together with the pledge of the bonds to it, for its indebtedness, claiming a first lien on the property. Numerous other parties intervened, among them Mr. L. B. Smead, claiming an interest in the bonds pledged by Hildebrand, subject to the assignment to the First National Bank. The officers of the First National Bank disclaimed any knowledge of the execution of the bill of sale to the American Exchange Trust Company. None of the other interveners testified.

Upon the hearing the court held that the claim of the American Exchange Trust Company, which had been reduced by a payment prior to Hildebrand’s departure and which at the trial amounted to $21,760.52, including interest, was inferior to the lien of the First National Bank and the other intervener pledgees. The court accordingly gave judgment first to the First National Bank, then to the other intervening pledgees, and lastly to the appellant. The property was ordered sold and the proceeds applied in that order.

The above is the substance of the statement contained in the brief of the appellant, which we find to be accurate, and, together with the following facts shown by the evidence, may be said to give an entire statement of all the relevant facts necessary to a determination of this appeal.

At the time Hildebrand applied for the loan from the First National Bank, he had in his possession $49,500 of the bonds of the Hildebrand Poster Advertising Company. He stated that he desired to borrow $7,500 from that bank, and that he expected t°o obtain an equal amount from the bank in Shreveport. The vice president and cashier to whom these bonds were presented was well acquainted with Hildebrand, and from his knowledge of the manner in which the business of the Poster Advertising Company had been conducted he thought that Hildebrand individually owned the business until the issuance of the bonds. At the time these bonds were presented, none of the officers of the First National Bank knew anything about the bill of sale having been given to the American Exchange Trust Company. The bonds to secure the money borrowed from that bank and the Shreveport bank were deposited in pledge with the First National Bank, and afterward the $7,500 note made to the Shreveport bank was assigned to the First National Bank. No inquiry was made of Hildebrand as to why he had possession of the bonds or how he had obtained possession of them, because it was the opinion of the officer who handled the matter that Hildebrand owned the business, and that he knew the bonds were secured by a mortgage on the assets of the Poster Advertising Company. At the time the bonds were first certified by the bank as trustee they were delivered to Hildebrand, and the bank had no knowledge of what disposition had been made of any of them nor any information except that they were in the possession and. control of Hildebrand at the time the loan was secured.

Hildebrand managed the business of the Advertising Company as if it was an individual matter. He was also active vice president of the Merchants’ & Planters’ Bank, in which it appears most of the money that the company earned or that Hildebrand borrowed was deposited. He did not have a separate account for the advertising company, but all of the business of the corporation was run through his personal account. From time to time Hildebrand had regular audits made of the business of the company, and the auditor, in stating the account of the business, showed the $15,000 evidenced by the two $7,500 notes, as pertaining to the business of the advertising company, and the indorsement on the cashier’s check shows that it was deposited in the account of Hildebrand for the advertising company. Other moneys seem to have been handled through a bank at El Dorado where an account in the name of the Hildebrand Poster Advertising Company was maintained.

The trial court found that the proceeds of the notes were received by and for the benefit of the advertising company, and that Hildebrand was authorized by its directors to negotiate the bonds and pledge the same as collateral security; that the First National Bank was the lawful holder of the bonds of the company of the face value of $49,500, and that these bonds were secured by a deed of trust duly recorded, and that the First National Bank had a lien which was prior and paramount to that of the other interveners ■ including the appellant. Judgment was given all of the interveners for the amount of their respective claims and the property of the corporation ordered sold and the proceeds applied, first, to the payment of the costs, second, to the First National Bank to the amount of $21,245.56, and the remainder, if any, to the interveners in the order named in the decree.

From that decree the Bank Commissioner prosecutes this appeal and presents to the court the following questions: (1) That regarding the validity of the claims of the First National Bank and of the other interveners who claimed an interest in the pledged bonds; (2) that of the validity of the bond issue; and (3) that of the priority of the claims.

Counsel for the appellee state, and this appears not to be contradicted, and we assume it to be a fact, that the money derived from the sale of the property of the advertising company made by order of the court is not sufficient to pay its claim. Therefore, if the decree of the trial court as to it should be sustained, it is unnecessary to discuss the validity of the claims of the other interveners or their priority with respect to each other. The trial court found as a matter of fact that the proceeds of the notes, the basis of the claim of the First National Bank, were received by, and used in, the business of the advertising company. There is but little evidence on this branch of the case. The entire business of the advertising- company was conducted by Hildebrand as if it had been his individual business, and he is the only one who could tell with any degree of certainty just how the money was applied. -His testimony could not be obtained, but we think there is some evidence to warrant the conclusion reached by the chancellor, which is certainly not against the preponderance of the testimony. We agree with the contention of the appellee however, that the mortgage bonds became a debt against the Hildebrand Poster Advertising Company in the hands of the First National Bank because it appears to have been a holder of these for value without any notice of their invalidity or of the equities of the appellant Bank Commissioner. The bonds were payable to bearer, and it is to be assumed that the holder thereof was either the owner outright or had the authority to dispose of them by assignment or by pledging them as collateral security; that is, where a bond is payable to bearer and has not matured, the holder of it is presumed to have obtained the instrument in good faith and for value. Sections 7818, 7822, 7825, Crawford & Moses’ Digest.

We are of the opinion that the trial court was justified in its conclusion that the First National Bank was an innocent purchaser of the bonds and had the right to assume that Hildebrand was the owner of the bonds or that he had the authority to pledge them for his personal obligation.

“When negotiable railroad bonds, perfect in form, payable to bearer, and certified by the trustee to evidence that they have become obligatory, are placed by the company in the hands of its president to sell or exchange for its benefit, they are valid in the hands of the purchaser in good faith before maturity, though they were disposed of by the president for his own benefit after consolidation of the company with other companies, and though, at the time of the purchase, two of the semiannual interest coupons attached to each bond were past due.” Long Island Loan & Trust Co. v. Columbus C. & I. C. Ry. Co., 65 Fed. Rep. 455.

The contention is made by the appellant that the bonds were void because they were issued in violation of article 12, § 8, of the Constitution, and because of this there could be no innocent holder for value. That section is as follows:

“No private corporation shall issue stocks or bonds, except for money or property actually received or labor done, and all fictitious increase of stock or indebtedness shall be void; nor shall the stock or bonded indebtedness of any private corporation be increased, except in pursuance of general laws, nor until the consent of the persons holding the larger amount in value of stock shall be obtained at a meeting held after notice given for a period not less than sixty days, in pursuance of law.”

In the case of Washer v. Smyer, 109 Tex. 398, 211 S. W. 985, the court had under consideration a section of the Constitution similar to ours above set forth. It was there said:

“There is no declaration in the constitutional provision that a transaction in which something other than money, property or labor is received in payment for the corporation’s stock shall be utterly void. It prohibits such a transaction, and therefore makes it unlawful, but that is the extent to which it goes. If a security be accepted in payment for the stock, such, for instance, as a subscriber’s note, which is not property for such a purpose, the Constitution does not say either that it or the stock issued for it shall be void. The acceptance of the note in payment for the stock and the issuance of the stock are only interdicted. The word ‘void’ is used but once in the constitutional provision, and that, it is to be noted, is not in the clause which prohibits the issuance of stock for other than money, property or labor. It is in tbe distinct clause wbicb says that all fictitious increases of stock or indebtedness shall be void. While tbe term is found in that clause of tbe section, tbe framers of tbe Constitution avoided its use in tbe other. It must be assumed that they did so deliberately. There is an essential difference between prohibiting a certain form of transaction — making it unlawful — and declaring that it, with all securities issuing out of it, shall be utterly void. It is a distinction familiar in tbe law. In order to bold a negotiable note unenforceable in the bands of a bona fide bolder, it is not enough that it be .founded upon an illegal consideration. It is not sufficient that it issue from a transaction prohibited by law, or one even denounced as criminal. To avoid it in tbe bona fide holder’s bands, there must be a constitutional or statutory provision wbicb expressly, or by unavoidable implication, declared it or tbe transaction of wbicb it is a part to be void. Such is tbe rule announced by Cbitty, Story and Daniel. It is tbe rule followed by this court and generally by courts elsewhere. ’ ’

Tbe above language was quoted with approval in Park v. Bank of Lockesburg, 178 Ark. 669, 11 S. W. (2d) 483, which was a case where a certificate of stock was issued, not for money but for a promissory note in violation of article 12, § 8, supra. There the court held that for tbe reasons stated by the Texas court the stock was not absolutely void but voidable, and that one lending-money in good faith and taking as collateral security tbe stock certificate, regular in form and carrying- no notice of infirmity on its face, was an innocent bolder for value. That case cites in support of the view reached German Bank v. Deshon, 41 Ark. 331; Bankers’ Trust Co. v. McCloy, 109 Ark. 160, 159 S. W. 205, and Bank of Manila v. Wallace, 177 Ark. 190, 5 S. W. (2d) 937. In tbe last case tbe appellee admitted the execution of tbe note sued on but denied liability on tbe ground that tbe note was given for stock in violation of tbe Constitution. Tbe appellant contended that the note was not given for stock, and that it was an innocent purchaser. The trial court, after bearing tbe testimony, directed a verdict in favor of the appellee, and this court, held that it was a question for the jury to say whether the note was given for stock in a corporation and whether the purchaser of the note was an innocent purchaser. See also City National Bank v. DeBaum, 166 Ark. 18, 265 S. W. 648.

As between the original parties to the bill of sale by which the American Exchange Trust Company sought to secure its loan, it may be treated as an equitable mortgage, but as to all others it was in form and legal effect a bill of sale and as such was not entitled to be recorded; and, as possession of the property was suffered to remain with the vendor, it was not notice to third parties.

As between the appellant and the appellee National Bank, we are of the opinion that the decree of the chancellor should be affirmed, and, as the assets of the advertising company have been sold by order of the court and the fund arising* therefrom is not sufficient to pay off the first lien, it is unnecessary to pass on any of the other questions raised, and the decree will be affirmed on the whole case.


author: Johnson, C. J.,

text:
    Richards v. McCall.
    4-2935
    Opinion delivered March 27, 1933.

      Virgil Greene and Hughes & Davis, for appellant.

      Harrison, Smith & Taylor and C. M. Buck, for appellee.
   Johnson, C. J.,

(after stating the facts). The first insistence of counsel for appellants for reversal of the case is that a verdict should have been directed in favor of appellants. It is argued that there was no testimony showing that Emma Kate Hall was acting as agent for her father, C. A. Richards, in driving the automobile at the time of the collision. On this point it suffices to say the appellants admitted that C. A. Richards was the owner of the ear; that he had a minor daughter attending school; that his daughter, Emma Kate Hall, was at liberty to use the car Avhen she wished and for whatever purposes she desired. From these admissions and other testimony in the record, the jury was fully Avarranted in finding that Emma Kate Hall Avas the agent of C. A. Richards in the operation of the car at the time of the collision.

It is next insisted on behalf of the appellants that the court erred in giving, of its own motion, instruction No. 8, in which the court told the jury that, if they found the defendant, Addie Richards, had authorized his daughter, Emma Kate Hall, to act for him in taking .his child to school and bringing her from school when he Avas not present and had given her general authority to do so, it would not be necessary for Mm to give her special or specific directions or authorization in every instance.

We think that the trial court did not err in giving this instruction. It submitted to the jury the question of the authorization of the father to the daughter to per form a service for him and was applicable to the facts presented in testimony.

It is next insisted that the court erred in refusing to give defendant’s requested instruction No. 3. This instruction reads as follows:

“You are instructed that, if you find that the defendant, Emma Kate Richards (Hall), was driving the automobile of the defendant, C. A. Richards, and had taken the car and left her home for the purpose of going to the sehoolhouse to get her sister, and that at that time she was authorized by the defendant, C. A. Richards, to do so, and in doing so she deviated from the purpose of her father, C. A. Richards, so that at the time of the accident she was not on the regular, most convenient and direct route from his home to the sehoolhouse, you will find for the defendant, C. A. Richards.

The trial court was eminently correct in refusing to give this instruction. It is not the law that the driver of the car, as agent for another, must travel on the regular, the most convenient or direct route from a point of beginning of a journey to the point of destination. The test is, has the party deviated from the course of employment for the purpose of performing some individual errand not in the interest of the master, or in the furtherance of duty?

It is next insisted on behalf of appellants that the undisputed testimony was to the effect that at the time of the collision Emma Kate Hall was not performing any duty in behalf of her father, but, on the other hand, was upon an errand of her own. We think the testimony is to the opposite effect. The uncontradicted testimqny is to the effect that Emma Kate Hall had returned to the intersection of Main and 7th streets for the specific and only purpose of turning to the left and going immediately to the sehoolhouse to perform the errand for her father. So it is, if the collision occurred after she had resumed the performance of the errand for her father, it is immaterial whether she had jnst previously to that time performed an errand of her own.

It is next insisted on behalf of the appellants that the appellee’s contributory negligence in endeavoring to pass the appellant’s car at the point of intersection of Main and 7th streets precluded his right of recovery. The negligence and want of care of each of the parties on this question were submitted to the jury on proper instructions, and we think the finding of the jury on this issue is conclusive upon this court.

It is our opinion that the case of Healey v. Cockrill, 133 Ark. 327, 202 S. W. 229, and the cases of Featherston v. Jackson, 183 Ark. 373, 36 S. W. (2d) 405, and Morton v. Hall, 149 Ark. 428, 232 S. W. 934, have no application to the facts in this case.

The judgment of the trial court is in all things affirmed.