text:
    Arkansas Foundry Company v. Stanley.
    Opinion delivered October 10, 1921.
    1. Bridges — single improvement. — Special Acts 1919, p. 74, creating the Broadway-Main Street Bridge District of Pulaski County, is not arbitrary and void in providing that the construction of two bridges across the Arkansas River, four blocks apart, shall be undertaken and prosecuted as one improvement.
    2. Constitutional law — judicial questions. — In a suit to enjoin the construction of two bridges, under Special Acts 1919, p. 74, the court will not concern itself with the expediency of the improvement.
    S Bridges — authority op bridge district to employ brokers.— Special Acts 1919, p. 74, § 9, authorizing the commissioners of a bridge district to borrow money át a rate of interest not exceeding six per cent., to issue negotiable bonds therefor, did not prohibit the commissioners from employing a broker to sell the bonds, but, on the contrary, impliedly authorized them t.o do so if reasonably necessary to sell the bonds.

      4. Bridges — power to borrow money. — Under Special Acts 1919, p. 74, authorizing the commissioners of a bridge district to sell bonds at not less than par and to pay interest at not more than 6 per cent, and to pledge the assessments as security, such commissioners are authorized to borrow money from banks at the prescribed rate and pledge the assessments therefor.
    Appeal from Pulaski Chancery Court; J. E. Martineau, Chancellor;
    reversed and affirmed.
    STATEMENT OP PACTS.
    The Arkansas Foundry Company, an owner of real property lying within the limits of the Broadway-Main Street Bridge District of Pulaski County, brought this suit in equity against the commissioners of said district to restrain them from employing agents in selling and disposing of the bonds of the district, and from proceeding - further with the construction of the bridges contemplated by the passage of the act.
    The complaint, amongst other things, alleges the following:
    “Par. 2. Said commissioners, in order to raise money to construct said bridges, are now threatening to borrow money from the banks in the City of Little Bock by issuing, or executing, ordinary evidences of indebtedness, and are threatening to pledge and mortgage the assessments for 'the security of said loans. That the commissioners are not authorized to so borrow money, the only method being pointed out by section 9 of the act, which method is by the issuance of negotiable bonds at a rate of interest not to exceed six per cent.
    “Par. 3. Said commissioners, having offered and failed to dispose of the bonds of the district, are also threatening and arranging to employ agents to dispose of said bonds, and to pay such agents a commission iherefor; that said bonds bear interest at the rate of six per cent, per annum; and if the commissioners are permitted to pay to said agents a commission for disposing of said bonds, the commissioners will receive from the sale thereof less than the par value of the bonds. Plaintiff avers that under the limitations of the power and authority of the commissioners, contained in said act, said commissioners have no power or authority to employ such agents and pay the commission for such purposes.
    . “Par. 4. That the board has no power or authority to construct the two bridges under a single improvement district. The General Assembly had no power to pass an act creating a district to make two separate improvements, and the act is void for want of power.
    “That the construction of two bridges ,as proposed by the commissioners would entail a large and unnecessary expense upon the taxpayers in the district, one bri dge being sufficient to accommodate the traffic between the cities of Little Rock and North Little Rock.”
    The bridge commissioners filed a demurrer to the paragraphs of the complaint above set forth, and the court sustained the demurrer to the second and fourth paragraphs of the complaint, and overruled it as to the third paragraph of the complaint. The defendants elected to stand, upon their demurrer to the third paragraph and refused to plead further. Accordingly it was decreed that the defendants be enjoined from employing agents or brokers to sell the bonds of said district, or to pay any commissions for services in that behalf. And, plaintiff declining to plead further, it was decreed that the prayer of the complaint for an injunction against defendants restraining them from borrowing money and issuing evidence of indebtedness in the form of notes and from proceeding with the construction of the proposed bridges across the Arkansas River, be denied, and paragraphs two and four of the complaint be dismissed for want of equity.
    Both parties have duly prosecuted an appeal to this court.

      George A. McConnell, for appellant.

      The construction of the two bridges four blocks apart, is not a single improvement, and cannot be likened to a road district such as found in 125 Ark. 325. The legislative finding that the improvement is a single one is a mere presumption, and is not 'conclusive. 141 Ark. 288. If the statute including certain territory in the district is arbitrary and discriminatory, it is void. 139 Ark.'574; 143 Ark. 203; 142 Ark. 52; 142 Ark. 73; 118 Ark. 294.
    The act provides the method of raising money, which is by issuing bonds, not notes, and the board has only such power as is expressly granted by said act. 106 Ark. 39. This case is different from that in 79 Ark. 229.
    The -commissioners have no authority to - employ brokers and pay them commissions to sell the bonds, as the act requires that the bonds shall not be disposed of at less than par and shall not bear more than six per cent, interest. In 86 Pac. 75 and 150 S. W. 90, the agency being dealt with was a city council, which has more imimplied authority than a special .improvement district, as is shown by 79 Ark. 234. The practice of a city paying brokers’ fees is condemned in 156 Pac. 825. Par value .is defined in 50 N. E. 973, as a dollar in money for a dollar in security. See also 53 N. E. 111-6. Where the statute provides that bonds shall sell at par, nothing less can be accepted, even by way of paying brokers ’ commission. 151 Pac. 117; 160 S. W. 1161; 160 N. W. 425; 82 Pac. 601.

      Vaughcm & Rector, Moore, Smith, Moore <& Trieber, for appellee.
    The power of the Legislature to create districts for the purpose of making local improvements is not open to question. 59 Ark. 513. When so exercised, it is a legislative determination, in the exercise of its power, which can not be disturbed by the courts unless the power has been exercised arbitrarily. 93 Ark. 113; 85 Ark. 12; 130 Ark. 507; 95 Ark. 496.

      The court will take judicial notice of geographic and commercial conditions in connection with bridges. 125 Ark. 553; 106 Id. 83; 88 Id. 37; 181 P. 223.
    The two bridges constitute one improvement. The same principle was upheld in 142 Ark. 73; Wlvite v. A. & M. Highway Dist., 147 Ark. 160; 137 Ark. 355, and various other cases.
    The board, under the statute, has the general power to borrow money and may do so by issuing notes, as well as by bonds. The power to issue negotiable' bonds is permissive, and does not have the effect to limit the commissioners to that form of security. 79 Ark. 229.
    The board was authorized to employ and pay brokers for the sale of the bonds. 145 S. W. 8; 130 S. W. 90, Ann. Cas. 1913 E p. 83 and cases in note on p. 86. See also 2 Dillon on Municipal Corp. sec. 895 (5th Ed.); 22 N. E. 24; 11 N. E. 1120; 1 Atl. 88; 86 Pac. 75; 78 N. W. 115; 8 Paige 527; 53 N. E. 1116.
   Hart, J.

(after stating the facts). On the part of the plaintiff, it is contended that the two bridges contemplated in the act are four blocks apart, and that the construction of one has no relation to the other. Therefore counsel insists that the construction of the two bridges constitutes independent improvements, and that the act of the Legislature in creating.the district as a single improvement district was arbitrary, and the act is consequently void. The act is entitled, “An Act to Create a Broadway-Main Street Bridge District of Pulaski County,” and was approved February 5, 1919. Act 49 of the Special Acts of 1919, page 74.

Séction 1 of the act creates the district, defines its territory, and names the commissioners. It authorizes the commissioners to build a bridge across the Arkansas River from a point on Broadway Street, in the city of Little Rock, to a point across the river in the city of North Little Rock to be selected by the commissioners. It also authorizes the construction of a bridge from a point on Main Street in the city of Little Rock to a point on the opposite side of the Arkansas River in the city of North Little Rock. The proposed bridges are four blocks apart, and the court will take judicial notice that there are connecting streets' between Broadway and Main Streets in the city of Little Rock and between the corresponding streets on the opposite side of the river in the city of North Little Rock.

Under our former decisions bearing on the question, the statute can not be assailed on the ground that it embraces more than one improvement. The Legislature, in passing the statute creating the district, must have found, as a matter of fact, that two bridges were necessary to carry the traffic between the two cities, and that the business centers of the proposed district were so situated, with respect to the contemplated improvements, as to justify treating them as parts of a common enterprise and as a single improvement. With the expediency of the proposed improvement in its present form, we have no judicial concern. It is sufficient for us to say that the Legislature must have found that the construction of the two bridges was necessary to secure a convenient and useful means of approach between the two cities, and that by uniting them in a single improvement they could best promote the improvement of the property within the district. When the topography of the proposed district is considered in connection with the density of population, it can not be said that the action of the Legislature providing that the construction of both bridges should be undertaken and prosecuted as one improvement is arbitrary and void. We consider the question no longer an open one in this State, and that it has been settled by the decisions cited below as well as many other decisions of this court. Bennett v. Johnson, 130 Ark. 507; Easley v. Patterson, 142 Ark. 52; Johns v. Road Imp. Dist., 142 Ark. 73; Tarvin v. Road Imp. Dist. No. 1, 137 Ark. 355; and White v. Ark. & Mo. Highway Dist., 147 Ark. 160.

It follows that the chancery court did not err in holding that the construction of the two bridges constituted, under the circumstances, a single improvement.

In the third paragraph of the complaint it is alleged that the commissioners are arranging to employ agents or brokers to dispose of the bonds to be issued under the provisions of the act for the construction of the improvement, and that this action is in violation of the terms of the act.

Section 9 of the original act reads as follows: “In order to do the work, the board may borrow money at a rate of interest not exceeding six per cent, per annum, may issue negotiable bonds therefor, signed by the chairman and secretary of the board, and pledge and mortgage all assessments for the repayment thereof. Said bonds shall not be disposed of at less than par on the basis of interest at the rate of six per cent, per annum. But, if they should bear a less rate, they may be disposed of at less than par provided that the district shall receive therefor and pay thereon the equivalent of not more than six per cent, per annum at par. “No bonds issued under the terms of this act shall run for more than thirty years; and all issues of bonds may be divided, so that a portion thereof may mature each year as the assessments are. collected.” Special Acts of 1919, No. 49 p. 74.

The evident pbject of the Legislature by the enactment of this section was to prevent speculation in the bonds to be issued by the commissioners for the construction of the proposed improvement and to insure to those who must pay the bonds a dollar in currency for every dollar of bonds issued. Par means equal, and par value means a value equal to the face of the bonds. So it is generally said that a sale of bonds at par is a sale at the rate of a dollar in currency for a dollar in bonds. Under the statute, the commissioners were not authorized to sell the bonds at a discount by reason of any commissions or attorneys’ fees paid to the purchasers, or to their agents or attorneys or by reason of issuing bonds drawing interest from a certain date and allowing the purchaser the use of the money loaned for a period of time thereafter.

Counsel for the plaintiff insists that under the statute the commissioners could not employ a broker to sell the bonds, regardless of the fact of whether he was the agent of the commissioners or the purchasers of the bonds. To support his contention, counsel cites the following: Uhler v. Olympia (Wash.), 151 Pac. 117; Davis v. San Antonio (Tex. Civ. App.), 160 S. W. 1161, and Whelen’s Appeal (Penn), 1 Atl. 88. In each of these cases the purchaser was allowed a discount by way of compensation paid it, or its agents, for commission, interest, or attorneys’ fees, and the court properly held, as a matter of law, that this constituted an evasion of the statute.

In Spear v. Bremerton (Wash.), 156 Pac. 825, the statement of facts shows that a contract for the sale of the bonds was made with John E. Price & Company, whereby that company agreed to attend to all the proceedings necessary in the issuance of the bonds, and to take the bonds at a discount of five per cent. The court properly held that this was clearly an evasion of the statute, and the reason given was that, under a statute forbidding the sale of the bonds at less than par, the taxpayer could not be put to the burden of paying the purchaser of the bonds anything in the way of commission or bonus, or for attorney’s fees and expenses of printing, etc. So, too, in Bay City v. Lumberman’s State Bank (Mich.), 160 N. W. 425, the court held that under the facts stated the transaction was a sale and purchase of the bonds by the bank from the city, and that the payment of the commission to the bank by the city was a discount in violation of the statute. The bank in that case claimed that it merely acted as the agent of the city in selling the bonds, but the court held that under the facts the bank took over the whole issue of bonds itself and resold them to its customers, The court said that, after the hank took -over the bonds, the -city had no interest in the selling value of the bonds, and, if they had appreciated in value, the bank and not the city would have received the 'benefit. On the other hand, had they depreciated, the loss would not have fallen upon the city. The bank never made any report of its sales of the bonds to the city, and there was no accounting for the proceeds of the bonds that it sold. The bank simply took over the whole issue of the bonds and disposed of them as it saw fit to its customers.

In the case of Paul v. Seattle (Wash.), 82 Pac. 601, relied on by counsel for the plaintiff, the charter of the city provided that no debt or obligation of any kind against the city should be created by the city council except by an ordinance specifying the amount and object of the expenditure. Therefore, the court properly held that the comptroller had no implied authority to contract with a broker to sell the bonds of the city.

Another case relied on by counsel is Fort Edward v. Fish (N. Y.), 50 N. E. 973. In that case the bonds -contracted to be sold by the water board included accrued interest and amounted to $50,444.44, whereas the contract price was but $50,000. The court held that the executorv contract provided for the sale of the bonds at less than their1 par value, and was absolutely void because this was prohibited by the statute.

So it will be seen that where the contract in express terms shows that the purchaser of the bonds is to .receive a discount, the courts hold as a conclusion of law that there has been an evasion of the statute. On the other hand, where the evasion of the statute appears from the facts stated and not from the contract itself, the courts hold, not as a matter of law, but as a matter of fact, that there has been an evasion of the statute. Whenever the facts show a subterfuge for an actual sale at less than par, or if the charges made are grossly unreasonable, or the transactioh is attended by bad faith, the courts will not hesitate to declare such transaction fraudulent and void. No allegation of bad faith on the part of the commissioners in seeking the service of a broker to sell the bonds is made in the complaint. The plaintiff merely alleges that under the statute the commissioners have no authority, either express or implied, to procure the service of a broker to sell the bonds or to aid them in the sale thereof.

This contention is against the weight of authority on the question. The statute gave the commissioners express power to issue and sell the bonds at not less than their par value and to pay interest thereon at not moré than six per cent, per annum. The power to sell the bonds carriedwith it the implied authority to pay a broker to sell them, or to assist the commissioners in doing so, if this was reasonably necessary. The employment of a broker might be reasonably necessary in order to sell the bonds, and, if so, the expenses of his commission would be incidental to the express authority to sell and would fairly come within the scope of the main power. The authorities cited below sustain this view, and say that it is according to the weight of authority. State v. West Duluth Land Co. (Minn.), 78 N. W. 115; Manitou v. First Nat. Bank of Colorado Springs (Col.), 86 Pac. 75; Church v. Hadley (Mo.), 145 S. W. 8; Armstrong v. Fort Edward (N. Y.), 53 N. E. 111, and cases cited; Miller v. Park City (Tenn.), Ann. Cas. 1913 E 83, and Brownell v. Greenwich (N. Y. Ct. of Appeals), 22 N. E. 24.

We believe that the above states the law applicable to this case, and that under the facts alleged in the complaint the commissioners would have the authority, if reasonably necessary to enable them to sell the bonds, to employ a third person as a broker for that purpose.

Therefore, the court erred in overruling the demurrer to the third paragraph of the complaint, and in enjoining the commissioners from employing brokers to sell the bonds of the district.

According to the allegations in paragraph, two of the complaint, the commissioners are about to borrow money from the banks of the city of Little Rock and to pledge the assessments for the security of the said loans. It is claimed by counsel for the plaintiff that the act only authorizes the commissioners to issue negotiable bonds at a rate of interest not exceeding six per cent. The complaint does not allege that the commissioners are going to pay more than six per cent, interest to the banks in the city of Little Rock from which they borrow money for the purpose of constructing the bridges. The bonds of the district would be nothing more than evidence of indebtedness of the district, and it could make no difference whether the commissioners borrowed the money in the city of Little Rock or from banks or other persons elsewhere.

The issuance and sale of the bonds of the district is nothing more than borrowing money by the commissioners for the purpose of constructing the improvement. The only prohibition in the statute is that they shall get face value for .the amount borrowed and shall not pay more than six per cent, interest per annum. Consequently the court was right in sustaining the demurrer of the defendants to the second paragraph of the plaintiff’s complaint.

From the views expressed, it results that the chancery court was right in sustaining the demurrer of the defendants to the second and fourth paragraphs of the complaint, and in these respects the decree will be affirmed.

It also follows that the court erred in overruling the defendants’ demurrer to the third paragraph of the complaint, and for this reason the decree will be reversed and the cause remanded with directions to enter a decree sustaining the demurrer to the third paragraph of the complaint, and for other proceedings in accordance with the principles of equity and not inconsistent with this opinion.


source: Caselaw Access Project

author: Smith, 'J.

license: Public Domain

text:
    King v. Bank of Pangburn.
    Opinion delivered October 10, 1921.
    1. Trial — both parties requesting peremptory instruction.— Though both parties requested the trial court to give a peremptory instruction, yet if appellant, in addition, asked other instructions, the court should not have directed a verdict against him i£ the testimony, viewed in the light most favorable to him, would have supported a verdict in his favor.
    2. Principal and surety — release — consideration. — Where an agreement to release a surety on a note was fully executed by the holder erasing his name from the note, and by writing opposite his name the notation “not on renewal,” it being agreed that the note should he renewed without his signature, the question of consideration for the release became immaterial.
    3. Contracts — consideration.-—Where a contract is fully performed on both sides, the question of consideration becomes immaterial.
    Appeal from White Circuit Court; J. M. Jackson, Judge;
    reversed.

      John E. Miller, G. E. YingUng -and W. R. Davenport, for appellant.
    The court erred in giving a peremptory instruction for the plaintiff.
    1. There was ample testimony to show that L. King signed the note as surety only. 54 Ark. 97; 92 Ark. 604; 143 Ark. 498.
    The note itself shows that the appellant’s name was cancelled and stricken off the note by the cashier of appellee bank. C. & M. Dig. § 7885, sub-divisions 3 & 4. The bank is estopped from asserting that it did not release appellant from liability. 131 Ark. 82.
    2. The appellee renounced its rights against the appellant by the cancellation of his name on the note. C. & M. Dig. § 7888.
    3. There was no satisfactory proof introduced by appellee to show that the name of appellee had been can-celled through mistake. C. & M. Dig. § 7889; 127 Ark. 234.

      4. The note was materially altered and is void. C. & M. Dig. § 7891. Any material alterations avoid the note. C. & M. Dig. § 7890; 131 Ark. 178; 127 Ark. 234; 5 Ark. 377; 32 Ark. 166; 82 N. J. Law 662; 82 Atl. 901; Ann. Cases 1913D, p. 721.
    The cashier had authority to alter the note and to release the appellant, and the bank is bound by his acts. 92 Neb. 539'; 138 N. W. 741; Ann. Cases 1914A, 57 and note; 18 Am. & Eng. Ann. Cases, 413 and note.
    ' Brundidge & Neelly, for appellee.
    1. The court was correct in directing a peremptory instruction for the plaintiff.
    There is no testimony to show the cancellation of the note. There was no consideration for the cancellation.
    2. Appellant’s liability was primary and absolute, demand and notice unnecessary. 143 Ark. 501.
    3. If the note was altered, it was through appellant’s procurement, and he could not take advantage of that fact. 131 Ark. 184; 112 U. S. 139-142; 2 C. J. p. 1219, n. 1; 1 E. C. L. 982; 26 Mich. 249; 35 Ark. 147; 148 111. 349.
    4. The agreement to strike the appellant’s name off the note was void for want of consideration. 106 Ark. 159. An agreement, in order to be binding, must have a consideration to support it. 96 Ark. 268. An agreement without consideration is void and does not suspend the rights of the parties. 12 -Wheat. (U. S.) 554; 26 Ark. 155; 54 Ark. 97.
    An extension of time to the principal, without consent of surety, discharges the latter. 34 Ark. 44; 82 Ark. 28; 103 Ark. 43; 123 Ark. 463.
   Smith, 'J.

This cause comes here on appeal from a judgment rendered on a verdict returned by a jury under the directions of the court. Appellee insists this judgment must be sustained if there was' any testimony legally sufficient to support it, inasmuch as both parties asked the court to give peremptory instruction in the trial below. It is true both parties asked a peremptory instruction; but, in addition thereto, appellant asked other instructions, and the court should not, therefore, have directed a verdict against him, if the testimony in his behalf, viewed in the light most favorable to him, would support a verdict in his favor. Webber v. Rodgers, 128 Ark. 25.

Thus viewing the testimony, the facts may be stated as follows: The suit is upon a promissory note for the sum of $1,500, which, as executed, reads as follows:

“$1,500. Pangburn, Ark., June 28, T9.
“Thirty days after date, for value received, we or either of us promise to pay to the order of Bank of Pang-burn fifteen hundred no 1/100 dollars at the Bank of Pangburn, Pangburn, Arkansas, with interest at the rate of ten per cent, per annum from date until paid. The makers and indorsers of this note hereby severally waive presentment for payment, notice of nonpayment, and protest, and authorize extension of time without notice thereof. Interest unpaid when due to become as principal and draw the same rate of interest.
Due — Demand. P. O. — City. No. 150.
Witness: R. II. Dickenhorst.
J. W. Pierce,
J. Morrow,
R. T. King,
L. E. Morrow,
L. King. ’ ’

J. W. Pierce, J. Morrow and R. T. King were principals, and L. E. Morrow and appellant, L. King, were sureties. Appellant King is the only signer who made defense, and this appeal involves only the question of his liability.

At or about the time the note fell due King was about to change his residence on account of his health, and he went to the bank to ascertain whether the note had been paid. Finding that it had not been paid, King demanded that the cashier give all parties notice to com" to the bank and pay the note, King stating at the time that he did not want to leave any unfinished business behind. The cashier, on his own initiative, suggested that he did not care to press the makers of the note for payment, but that if he (King) would cause $400 to be paid on the note the time for the payment of the balance would be extended, and King released from further liability. Acting upon this suggestion, King saw the makers of the note and had them to pay the sum of $400 on the note. About two days later King called at the bank to see if this payment had been made. Only the assistant cashier was present in the bank at that time, but that officer, who was familiar with all the facts, promised to call the matter to the attention of the cashier. Relying on this promise, appellant King gave the matter no further attention until this suit was brought.

Thereafter the following notations were made on the note by the cashier of the bank: The payment of the $400, with the date of payment, was indorsed on the back of the note. Above the date of the note there was written with pen and ink the words, “Renewal date 7-29-19.” The words, “Thirty days,” appearing in the original note, were obliterated by drawing a line through them with pen and ink and the word “Demand” written above them. The name of “L. King” — this appellant — was canceled by drawdng a line through it and immediately following the name the words “Not on renewal” were written above with pen and ink. The words “Ten days,” in the lower left-hand corner of the note, were obliterated by a line drawn through them, and the word “Demand” written above them.

Appellee defends the action of the court below in directing a verdict in its favor upon the ground that the agreement to release appellant was without consideration, and says the transaction between the parties constituted, in effect, a mere renewal of the note, and, being only a renewal, King was not discharged, and, in support of this position, cites and relies upon the case of Hamiter v. State National Bank of Texarkana, 106 Ark. 157. We have here, however, the converse of the case of Hamiter v. Bank, supra. There the note was renewed under an agreement to accept the new note of Hamiter in payment of the note sued on — the original note — the agreement being made after the original note had fallen due, and without a surrender of the original note or any change therein. Here'we have an executed agreement to release King. The signature of King was obliterated. Other material alterations were evidenced by other mutilations. These mutilations were made in the execution of the agreement to release King, and to further conclusively evidence the execution of the agreement to release King there was written opposite his name the notation, “Not on renewal.” King thus ceased to be a maker of the note sued on.

The agreement to release King having been fully performed, it becomes immaterial to determine whether it was enforcible prior to its performance. The agreement has been executed. It became an accomplished fact. Kerr v. Birnie, 25 Ark. 225, 234.

If a contract is fully performed on both sides, the question of consideration becomes immaterial. 1 Page on Contracts, § 540; 1, Elliott on Contracts, § 202, p. 330.

The note is now, in effect, a new note to which King is not a party, and he can not therefore be now sued as if he were a maker thereof. The judgment of the court below must therefore be reversed, and, as there is no dispute about the controlling facts, the cause will be dismissed.


author: Humphreys, J.

text:
    Model Window Glass Company v. Moody.
    Opinion delivered October 10, 1921.
    Master and servant — liability for wages. — Where appellee had worked for appellant during the previous year under a wage scale known as the “National Agreement,” by the terms of which the appellant was bound to pay an employee, who reports for duty and finds the plant not ready to operate, at the rate of $20 per week until the plant is in operation, and in September, 1918, appellees were invited by appellant to be at appellant’s factory on December 8 following, and they waited there several weeks before the plant resumed operation, the invitation was for appellees to work under the existing agreement, and appellant became liable thereunder, though this agreement, by its terms, expired on December 8, 1918, and the union to which appellees belonged failed to agree upon a new wage scale for the ensuing year.
    Appeal from Sebastian Circuit Court, Ft. Smith District; John Brizzolara, Judge;
    affirmed.

      W. II. Dunblazier and J. B. McDonough,. for appellant.
    The court should have submitted the issues to the jury. New facts were developed on this, the second trial of the case, and the former ruling of the court is not conclusive, and the trial court may apply a different rule of law. 129 Ark. 43. It is only in cases where the testimony is precisely the same that the former decision controls. 134 Ark. 605; 204 S. W. 618.
    There was no contract in existence when appellees were requested to report for work, and therefore no liability on the part of appellant. The constitution, rules and by-laws of a union constitute the contract between the members of the union. Martin on Modern Labor Unions. Sec. 287.

      Webb Covington, for appellees.
    The appellant recognized the existence of the contract under which the suit was brought by making two payments thereunder to each of the appellees. This alone should support the verdict.
   Humphreys, J.

This case is before us on a second appeal. The appellees were appellants in the former appeal. This court ruled on that appeal that the trial court had erred in peremptorily instructing a verdict in behalf of the Model Window Glass Company, and remanded the cause for a new trial. The case was quite fully stated in the former opinion, and the statement there found is adopted as the statement in this case, in so far as the facts in the two cases are alike. For the statement, see Moody v. Model Window Glass Co., 145 Ark. 197. The additional evidence introduced on the new trial was to the effect that the wage scale in effect up to December 8,1918, expired on that date, by reason of the inability of appellant and the union, of which appellees were members, to agree upon a wage scale for the en,suing year. The witnesses introduced testified that the failure to agree upon a wage scale on that date for the ensuing year rendered the old contract nugatory, and that none of the provisions in the old contract were binding upon the parties after that time and until a new wage scale was agreed upon by and between the representative of the union and the appellant, or its representative. At the conclusion of the evidence, the court peremptorily instructed a verdict for appellees, and rendered judgment in accordance therewith, from which judgment is this appeal.

Appellant contends that the additional evidence adduced -made an entirely different case from what it was when here before. In rendering the opinion on the former appeal, after reciting the facts, this court said: “The facts stated constituted an implied contract, if not an express contract, to settle with appellants according to the terms of the national agreement. The correspondence set out above' warranted appellants in believing, under the circumstances of the case, that they would be given employment, or be paid in accordance with the provisions of the national agreement, with reference to which the parties must be held to have contracted.” Appellees had worked for appellant during the preceding year under the provisions of the contract denominated the “national agreement. ’ ’ Article 5 of the agreement reads as follows : “Any company hiring a member and said member, upon arriving and reporting for duty, finding no vacancy existing or plant not ready to operate, as per notification, shall pay said member at the rate of $20 per week until place is vacant or plant in operation, or, at the option of the member, said company shall defray all expenses incurred by said member from the time he. left his home or place of starting until his return to destination.” Both parties were familiar with this clause in the contract. The invitation of appellant to appellees to return to Fort Smith and go to work was an offer to give them their positions under the terms of the old contract. The letter of September 6, 1918, urging appellees to work for appellant the coming season, contains the following statement: “Will say I am depending on you and Moody in your old places this coming season. Please advise me by return mail if you will he on hand.” The subsequent letter of November 19, 1918, notifying appellees to be at Fort Smith on December 9 and asking whether the company could depend on them being ready to work on that date, was tantamount to saying to appellees that the new wage scale, which must under the evidence he a basis for the contract for the ensuing year, had been, or would he, settled and agreed upon by that time. The offer and acceptance of employment had reference to employment under the terms of the old contract. Therefore, the new evidence offered, to the effect that no wage scale had been fixed for the ensuing year, was immaterial. Being immaterial, it was not incumbent upon appellees to inquire before leaving California, as argued and contended by appellant, concerning the new wage scale.

No error appearing, the judgment is affirmed.


text:
    Missouri Pacific Railroad Company v. Fuqua.
    Opinion delivered October 10, 1921.
    1. Carriers. — negligence.—Where there was evidence from which the jury might have found that employees of defendant in charge of its parcel room were negligent in not taking steps to save plaintiff’s suit case from destruction in a fire which destroyed defendant’s depot, a finding of negligence on defendant’s part will not be set aside as unsupported by evidence.
    2. Carriers — liability for loss of goods stored. — The language of a contract providing that “the carrier will not be responsible for loss, damage or detention of articles left in storage for any > amount in excess of $25” is broad enough to limit the carrier’s liability for loss on any account, including loss by fire.

      3. Warehousemen — limitation of liability. — A -warehouseman may limit his liability to an agreed value of the article received where the rate charged is based upon the value of the article.
    Appeal from White Circuit Court; J. M. Jackson, Judge;
    modified and affirmed.

      Ponder & Gibson and Thomas B. Pryor, for appellant.
    The appellant is only liable to ordinary care as a warehouseman. 27 R. C. L. Sec. 53; 136 Am. Rep. 243; 6 Am. St. Rep. 602; 1 Am. St. Rep. 76. It is not an insurer of goods in its care and not liable for their loss by accidental fire. 32 Ark. 225; 42 Ark. 200; 21 Ark. 560; 52 Ark. 30 ; 97 Ark. 288; 90 Ark. 260; 24 Am. Dec. 143; 40 Cyc. 432.
    It must be shown by the proof that there was negligence on the part of appellant or its servants. 27 R. C. L. Sec. 53; 49 Am. Rep. 430; 35 Am. Rep. 263; 24 L. R. A. (N. S). 1117; 61. Am. Dec. 423.
    When a contract is based upon a consideration, a stipulation reducing the amount of liability is valid. 83 Ark. 502; 108 Ark. 115; 110 Ark. 612; 227 U.' S. 639; 68 S. E. 289; 18 L. R. A. (N. S.) 295.
    The owner is bound by the conditions printed on the check, although he failed to read them. 12 C. B. N. S. 75; 17 L. T. N. S. 469.

      Brundidge & Neelly, for appellee.
    Appellant was guilty of negligence in failing to remove baggage which was uncalled for by tbe owner.
    Liability by reason of the negligence of appellant cannot be limited, even though the contract contained this provision. 90 Ark. 258 and cases cited.
   Humphreys, J.

Appellee instituted suit against appellant in the White Circuit Court to recover $300 for a suitcase and its contents, alleged to have been destroyed by fire on the 7th day of April, 1920, through the negligence of appellant in failing to remove it after discovering that its depot at Little Rock was on fire.

Appellee filed an answer, denying the material allegations of the complaint, but pleaded in the alternative that, should appellee be permitted to recover the amount, it should be limited to a maximum of $25, as per stipulation in the check issued to him when he left the suitcase in storage.

The cause was submitted upon the pleadings, evidence and instructions of the court, which resulted in a verdict and judgment in favor of appellee for $150, from which judgment is this appeal.

The record reflects that appellee, en route to Oklahoma, remained in Little Bock over night. He checked his suitcase in the parcel room of appellant, and, upon payment of ten cents, received a parcel stub check containing the provision that appellant “will not be responsible for loss, damage or detention of articles left in storage for any amount in excess of $25.” There was an outside door and window to the checking room, and a chute to the basement.' The depot was destroyed that night by an accidental fire, which started about 8 o’clock. The employees in the checking room were driven out by the fire within thirty minutes after it started. There were three employees in the room, who busied themselves finding and delivering parcels to those who called for them in person.’ About one hundred parcels were saved by delivering in this way to those who rushed to the room. About fifty parcels were left in the room and burned. No effort was made by any of the appellant’s three employees in the room to save the uncalled-for parcels, among which was appellee’s suitcase. The employees said they were busily engaged the entire time before leaving the building in getting parcels to those who applied in person for them; also that, had they thrown the parcels out, some one would have carried them off, as they could not have gotten a reliable person to watch them; also that, had they carried any of them out, the police force and firemen would not have permitted them to return to the building. During the fire, employees in the basement were engaged in removing parcels to a safe place.

It is contended by appellant that, in tbe exercise of ordinary care, it could not bave prevented the destruction of the suitcase and its contents. We think there is some substantial evidence tending to show otherwise. No effort whatever was made to save the parcels of those who did not call for them. Three employees were in the room, and they devoted their entire time to handing out parcels to those who called for them, spending frequently a minute in searching for the particular parcel. The jury might well have concluded that all the parcels might have been saved had they gotten them out and searched out, the particular parcels and delivered them later. All might have been thrown down the chute where other employees were engaged in carrying the parcels to a place of safety from the basement; or the parcels might have been thrown through the door or window to a safe place .on the outside. One of the employees might have guarded them on the outside while the other two removed them from the checking room. We think the evidence sufficient to sustain the verdict.

It is also contended by appellant that the court committed error in permitting a recovery in excess of $25. Appellee contends otherwise, insisting, first, that the contract makes no attempt to exempt appellant or limit its liability by reason of negligence; second, that appellant could not limit its liability growing out of its own negligence.

(a) We think the contract broad enough to limit appellant’s liability on any account The language of the contract is: “The carrier will not be responsible for loss, damage or detention of articles left in storage for any amount in excess of $25.” It is broader than the language used in the Gulf Express Co. v. Harrington, 90 Ark. 258.

(b) A warehouseman may limit his liability to an agreed value of the article received, where the rate charged is based upon the value of the article. This character of contract does not' contravene the principle that one cannot contract for exemption or limitation from liability on account of his own negligence. The rule is stated in keeping with the principle 'announced in K. C. S. R Co. v. Carl, 227 U. S. 639.

The judgment is therefore reversed and modified by a reduction in the amount to $25.


author: Per Curiam.

text:
    Road Improvement District No. 4 of Prairie County v. Mobley.
    Opinion delivered October 10, 1921.
    1. Courts — jurisdiction of supreme court. — The jurisdiction of the Supreme Court, under Const. 1874, art. 7, §§ 4, 5, is merely appellate and supervisory, except in the exercise of original jurisdiction to issue writs of quo warranto.
    2. Courts — supreme court — jurisdiction.—In its review of the errors of inferior courts, the Supreme Court is confined to the record made helow, and has no authority to inquire beyond the record made below. *
    3. Certiorari — construction of statute. — Crawford & Moses’ Dig. § 2237, providing that the circuit courts shall have power to issue writs of certiorari to any inferior tribunal to correct any erroneous or void proceeding, has no application to original applications for certiorari, in the Supreme Court.
    4. Courts — jurisdiction of supreme court. — The Supreme Court has no original jurisdiction to issue a writ of certiorari to review'a judgment of the circuit court upon the sole ground that the court stenographer failed, without fault of petitioners, to prepare the transcript of the oral proceedings within the time allowed by the lower court, and that petitioners were thus, without fault, prevented from preparing the record for an appeal.
    Certiorari to Prairie Circuit Court, Northern District; George W. Clark, Chancellor;
    petition denied.

      Emmet Vaughan, BruncCidge & Neely, for appellant.

      Roy D. Campbell, F. E. Brown, Jolvn F. Clifford, for appellee.
   Per Curiam.

This is a petition for a writ of certiorari to bring up for review a judgment for the recovery of money, rendered against petitioners by the circuit court of Prairie County on September 10, 1920, in favor of the resDondeA s, who were the plaintiffs in the action below. It is alleged in the petition that a motion for a new trial was filed and overruled by the -court; that an appeal to this court was granted by the trial court; and that time was allowed (120 days) within which to prepare and file a bill of exceptions. The sole ground urged for the issuance of the writ of certiorari is that the court stenographer failed, without fault of petitioners, to prepare the transcript of the oral proceeding's within the time allowed by .the court, and that petitioners were thus prevented, without fault on their part, to prepare the record so that an appeal was available for a review of the record in this court.

The 'jurisdiction of this court is, under the Constitution, merely appellate and supervisory, except in the single instance of the exercise of original jurisdiction in the issuance of writs of quo warranto. Constitution of 1874, article 7, sections 4 and 5. The various writs authorized to be issued by this court'are merely in aid of such appellate or supervisory jurisdiction. Ex parte Jackson, 45 Ark. 158; State v. Neel, 48 Ark. 283. And a review by this court for errors of inferior tribunals is confined to the record made below. This court has no authority to inquire beyond the record made by those courts. Such further inquiry would constitute the exercise of original jurisdiction. It is not claimed that there is any error appearing in the record made in the court below. Ini other words, it is not claimed that there is any error on the face of the proceeding, but the claim is that the petitioners were prevented, without their fault, from making a record by bill of exceptions, which would have disclosed errors in the proceedings; and the contention is that they are entitled to relief under the remedy afforded by the writ of certiorari.

Counsel for petitioners rely upon decisions of this court, holding that the rQmedy under the writ of certiorari is available where the right of appeal has been unavoidably lost. Burgett v. Apperson, 52 Ark. 213; Lamb & Rhodes v. Howton, 131 Ark. 211. Those were cases where relief was sought in the circuit- court from judgments of inferior courts over which that court had supervisory control, and under and pursuant to the statute which authorizes, "a, review of proceedings in inferior courts for relief against either erroneous or void judgments. Crawford & Moses’ Digest, section 2237. Those cases, therefore, have no application to the question of the authority of this court, for this court has no original jurisdiction, and such original jurisdiction for relief against fraud, accident or mistake is cognizable in courts of chancery, and in that court alone must petitioners seek relief for the alleged unavoidable loss of the right of appeal. Kansas & Arkansas Valley Rd. Co. v. Fitzhugh, 61 Ark. 341; Little Rock & Fort Smith Ry. Co. v. Wells, 61 Ark. 354.

The writ is therefore denied.


author: McCulloch, C. J.

text:
    Williams v. Sanderson.
    Opinion delivered October 17, 1921.
    Evidence — competency.—In an action by a real estate broker against a purchaser of land to recover for services in the purchase of the land, testimony of a witness that he was present at an interview between plaintiff and the person who sold the land, offered merely for the purpose of proving that plaintiff was attempting to purchase the land for defendant’s intestate, held competent.
    Appeal from Miller Circuit Court; George R. FLaynie, Judge;
    affirmed.

      Henry Moore, for appellant.
    The court erred in admitting the testimony of witness Hinton as to conversations had between appellee and Paup in the absence of appellant’s intestate and in refusing appellant the right to introduce testimony to negative that of witness Hinton.
    Appellee was acting as the agent of both parties without their knowledge and consent which is not permissible, 143 Ark. 1, and appellant’s instruction based thereon should have been given.

      Jones & Head, for appellee.
    The case cited by appellant to support his contention that his instruction No. 2 should'have been given is clearly against him. 82 Ark. 381.
   McCulloch, C. J.

Appellee presented in the probate court of Miller County a claim for allowance against the estate of appellant’s intestate, and the case was tried in the circuit court on appeal, resulting in a verdict and judgment in favor of appellee for the allowance of the claim.

The claim of appellee is for the sum of $500 as commissions for services alleged to have been performed by him for the decedent in the purchase of a farm from W, W. Paup. There was no attempt in the trial below to establish an express agreement between appellee and appellant’s intestate for the payment of a commission, but the testimony adduced by appellee tended to prove that decedent engaged his services in an effort to buy the farm from Paup, that appellee’s services procured the purchase from Paup, which was duly consummated, that the price of the farm was about $50,000, and that the amount sued for was reasonable compensation for the services rendered. These issues were submitted to the jury upon correct instructions, and the verdict settled the issues in appellee’s favor.

Error of the court is assigned in permitting witness Tom Hinton to testify concerning a conversation between appellee and Paup in the absence of appellant’s intestate. The witness testified concerning interviews, at which he was present, between deceased and appellee, and between deceased, appellee and Paup, and also between appellee and Paup. The witness testified that he had two conversations with decedent in regard to appellee’s services in this matter, in the first one of which witness advised decedent to get appellee to handle the matter with Paup, and in the second conversation decedent stated to witness that appellee was working on the matter and “was still trying to get it lined up. ” The witness also testified to being present at a conversation between decedent and Paup and appellee, in which Paup said, in connection with stating the price, that he would not pay any commission on the sale. The witness was then permitted to testify, over the objection of appellant, that he was present at an interview between appellee and Panp concerning the purchase of the farm for appellant’s intestate. Counsel for appellee offered this testimony merely for the purpose of proving that appellee was attempting to purchase the farm for decedent, and not for the purpose of proving the statements of Paup and appellee to each other. The court admitted the testimony for'that purpose alone, and we are of the opinion that there was no error committed in that respect. There was no attempt to bind appellant’s intestate by the statements made by appellee and Paup to each other, but this testimony tended to establish the fact that the efforts of appellee brought about the purchase of the farm from Paup and that the commission was earned.

The sale of the land by Paup was consummated by a joint deed to appellant’s intestate and to C. R. Crank and Allen Winham. Appellant offered to prove by Crank and Winham that they were interested with appellant’s intestate in the purchase of the farm, and that appellee had not presented any bill to them for compensation for making the purchase. The court was correct in excluding this testimony, for the reason that there was no contention on the part of appellee that he had performed the service at the instance of or for the benefit of Crank or Winham. The fact that he had not made any claim against those gentlemen for compensation had no probative force in determining whether or not appellee’s claim against the estate of the decedent Williams was well founded.

It was developed in the testimony that, shortly after the consummation of the sale, Paup paid appellee the sum of $500, and the contention of appellant was that this was paid as commission on the sale, that the payment thereof demonstrated the fact that appellee was attempting to act for both parties, and was claiming a commission from each of them. Appellee and Paup each testified that the payment of $500 by the latter to the former was not as a commission on this sale, but was for other services; and the court submitted that issue to the jury in instructions which told the jury that, if appellee was acting’ as agent for both parties in the transaction, he could not recover against the estate of Williams unless there was an express promise on the part of Williams to pay a commission with knowledge of the fact that appellee was acting as agent for both parties; but that, if the payment of $500 was not made as compensation for services in making this sale, it would not affect appellee’s right to recover compensation from appellant’s intestate.

We find no error in the proceedings, and since the evidence is legally sufficient to sustain the verdict, the judgment must be affirmed, and it is so ordered.


text:
    Wright v. Bennett.
    Opinion delivered October 17, 1921.
    1. Principal and agent — misrepresentations of agent. — A principal has a right to rely upon the representations of his agent, without inquiring as to their correctness, and his failure to make inquiry will not deprive him of relief against his agent’s fraud.
    2. Brokers — -fraud—relief.—Though a principal consummated an exchange of lands after ascertaining that his agent had made false representations concerning the exchange, he will not be barred from relief against the agent where the other parties to the ex change were not parties to the misrepresentations.
    Appeal from Benton Chancery Court; B. F. Mc-Mahan, Chancellor ;
    affirmed.

      Duty S Duty and Lee Seamster, for appellant.
    Appellee, pro se.

   McCulloch, C. J.

Appellee owned a farm in Benton County, and listed it with appellant for sale or exchange, agreeing to pay a commission. A. L. Pickerall and L. A. Dykes also owned a farm in Benton County, and listed same with appellant, who negotiated an exchange between appellee and those parties. Under the terms of. the exchange, Pickerall and Dykes were to pay the sum of $600 to appellee. They executed a note to appellant for said amount, and appellee instituted this action against appellant to restrain him from collecting the note, on the ground that he had misrepresented the terms of the sale to appellee. The controversy between appellant and appellee relates to the amount of the commission and certain alleged -representations made by appellant to appellee concerning the terms of the trade between the appellee and .Pickerall and Dykes. The contention of appellee is that he first demanded the sum of a thousand dollars in the trade, but finally agreed to accept $600 on condition that appellant would only require him to pay $200 commission; but that appellant subsequently represented to him (appellee) that Pickerall had refused to consummate the trade unless he should receive $300 of the $600 that was paid in the exchange, and that appellee, in order to consummate, the trade and in reliance upon the representations of appellant concerning the demand of Pickerall, consented to this arrangement. The allegation of the complaint is that the representations made by appellant concerning the dedemand of Pickerall were false; and there was testimony tending to sustain appellee’s contention on that point. Appellant contends, on the other hand, that he made no such representations to appellee in regard to such demand from Pickerall; that appellee agreed to pay him a commission of $500 on the exchange, and that he had tendered to appellee the sum of a hundred dollars — the difference between the amount of the note and his commission.

The testimony is sharply conflicting, and is confined mainly to the testimony of the two parties themselves— appellant and appellee. There was another witness, named Holcomb, a nephew of appellant, who testified that he was present when the parties went out to look at the farms, and heard appellee agree to pay a commission of $500. The contention, however, of appellee is that, at that time, he was holding out for a difference of a thous- and dollars in the exchange, and that afterwards, when Pickerall and Dykes offered $600, he consented to the reduction on condition that appellant would reduce his commission to $200. Pickerall testified that he made no demand on appellant that he should he paid $300 out of the note when collected, and he testified that he and Dykes gave the note for the difference with no expectation that any of it would be returned

Viewing the testimony in the record, it appears to be about evenly balanced, and under those circumstances it is our duty not to disturb the finding of the chancellor.

The point is made that appellee had no right to rely on alleged representations of appellant, but should have pursued the inquiry and ascertained from Pickerall that no such demand had been made. The answer to that contention is that appellee had the right to rely upon the representations of appellant as his agent, and the fact that he did so rely upon these representations, without inquiring further, does not deprive him of relief against the fraud of his agent.

Again, it is contended that appellee should be denied relief on the ground that he consummated the exchange after ascertaining the falsity of the alleged representations made to him. This contention is not sound, for the reason that Pickerall and Dykes we're not parties to the misrepresentations, and appellee was bound by his contract with them, notwithstanding the misrepresentations of his agent, and appellee’s only remedy was to consummate the sale and seek a remedy against his agent.

The state of the record is, as before stated, such that we cannot say that the preponderance of the evidence is against the finding of the chancellor. The decree is therefore affirmed.


author: McCulloch, C. J. Hart, J.,

text:
    Ferrell v. Massie.
    Opinion delivered October 17, 1921.
    1. Highways — collection op assessments — time op appeal.— Crawford & Moses’ Digest, § 5687, providing that a transcript on appeal from decree enforcing the collection of a highway assessment “shall be filed in the office of the clerk of the Supreme Court within twenty days after the rendering of the decree appealed from,” is mandatory.

      2. Highways — collection of assessments— time of appeal.— Crawford & Moses’ Digest, § 6687, requiring the transcript on appeal from a decree enforcing the collection of a highway assessment to.be filed within 20 days after the rendering of the decree, applies in the case of an appeal from such a decree though the defendant by cross-bill seeks to attack the validity of the district or of the assessment of benefits.
    3. Highways — enforcement of assessments — statutes construed. ■ — :There is no conflict between the statute authorizing vacation decrees on stipulation of counsel (Crawford & Moses’ Dig. § 2190) and the statute (Crawford & Moses’ Digest., § 5681) providing that the chancery court shall be always open for the purpose of taking any step in the enforcement of highway assessments, and both statutes are applicable to.suits to enforce such assessments.
    Appeal from Prairie Chancery Court, Southern district; John M. Elliott, Chancellor;
    appeal dismissed.

      Mehaffy, Bonham & Mehaffy, for appellants.

      J. F. Holtsenclorff and. Chas. B. Thweatt, for appellees.
   McCulloch, C. J.

Appellees constitute the members of the board of improvement of an improvement district created under the general statutes in the town of Hazen for the purpose of improving certain streets and sidewalks, and this action was instituted in the chancery court of the county to enforce the payment of assessments and penalties thereon. The complaint contains allegations in general terms setting forth the creation of the district, the assesment of benefits, etc., and the nonpayment of the assessments by the defendants. A list of the unpaid assessments was exhibited with the complaint.

Appellants, who were defendants below and are the owners of property in the district, filed a joint answer, in which they denied all the allegations of the complaint with respect to the creation of the district, and the levy of assessments, and the non-payment thereof. They also incorporated in the answer a cross-complaint attacking the validity of the district and the assessment of benefits on numerous grounds, alleging failure to comply with the statute with respect to the original petition for the ■creation of the district, the second petition, the publication of notice, the enactment of the ordinances, and various other things required by the statute. Crawford & Moses’ Digest, §§ 5647 et seq. The prayer of the answer and cross-complaint is that the ordinances in regard to the district be declared invalid, and that the commissioners be restrained from attempting to collect assessments and from further proceedings under the ordinances.

The cause was heard by the chancellor in vacation on stipulation of counsel, and a decree was rendered in favor of appellees for the collection of the unpaid assessments and for the sale of the property of appellants if the assessments be not paid, and also dismissing the cross-complaint for want of equity. An appeal was prayed and granted by the chancellor; but the transcript was not filed in this court within twenty days.

There is a motion to dismiss the appeal on the ground that the transcript was not filed within the time required by statute. The statute in regard to improvement districts situated wholly within municipalities provides that, if the assessments on the property be not paid within the time required, the board of improvement •shall “straightway cause complaint in equity to be filed in the court having jurisdiction of suits for the enforce-' ment of liens upon real property for the condemnation and sale of such delinquent property;” that the courts shall always be open for the purpose of taking every necessary step in such suits; that in the decree of condemnation the court “shall direct that if the sum adjudged shall not be paid within ten days the property shall be sold by a commissioner appointed for that purpose;” that no appeal shall be prosecuted from such decree “after the expiration of twenty days herein granted for filing the transcript in the clerk’s office of the Supreme Court;” and that the transcript “shall be filed in the office of the clerk of the Supreme Court within twenty days after the rendering of the decree appealed from.” Crawford & Moses’ Digest, §§ 5673 et seq.

We have held that this statute is mandatory with respect to the time for obtaining the appeal and for filing the transcript. Crandell v. Harrison, 105 Ark. 110; Miller v. White, 108 Ark. 253.

This is a suit for the collection of delinquent assessments, as provided in the statute; but the contention is that the cross-complaint of appellants, attacking the validity of the district and the assessment of benefits, takes the case out of the operation of the statute with respect to the limitation of time for taking an appeal and filing the transcript.

The majority of the court are of the opinion that this contention of counsel is not well founded. The manifest purpose of the statute is to expedite the final disposition of suits to enforce collection of assessments in improvement districts of this kind (Miller v. White, supra); and when a suit is instituted for that purpose, it still retains its character, notwithstanding an effort, by way of cross-complaint, to adjudicate invalidity of the district. The statute prescribes the form of the decree in such cases and fixes a limitation upon appeals “from any such decree.” The decree in the present case falls squarely within the terms of the statute, and the effect of this limitation is not avoided by the fact that appellants, in presenting a defense against the enforcement of the assessments, pleaded new matter by way of cross-complaint.

It is further .contended by counsel that, since the statute provides that the chancery court shall always be open for the purpose of taking necessary steps in suits to enforce the collection of assessments (Crawford & Moses’ Digest, § 5681, the statute authorizing vacation decrees on stipulation of counsel (Crawford & Moses’ Digest, § 2190) has no application* and that, if the vacation decree in this case be valid, the suit must be treated as one not falling within the statute in regard to suits for the enforcement of assessments. The two statutes are not at all inconsistent with each other, and are both, applicable to suits of this character. The fact that under the statute the court is open at all times for the hearing* of such cases does not affect the application of the other statute providing for vacation decrees on stipulation.

The transcript not having been filed within the time specified in the statute, it follows that the appeal must be dismissed. It is so ordered.

Hart, J.,

(dissenting). Judge Wood and myself do not think that the majority opinion is sound when all the material facts contained in the record are considered. Not only did the defendant file a cross-bill assailing the validity of the improvement district on numerous grounds, as stated in majority opinion, but in addition it may be said that no objection was made by the plaintiffs to the filing of the cross-bill. On the contrary, they filed an answer in which they specifically denied every allegation of the cross-bill seeking to assail the validity of the district.

The court below then made an order allowing the de- ■ fendants to make proof on the issues thus raised. Proof was taken, and the case was heard in the chancery court upon the pleadings and the proof made. The court made specific findings sustaining the validity of the organization of the district and specifically dismissed the cross-bill of the defendants for want of equity.

The parties and the court below having all treated the case as a suit to test the validity of the district, it is manifestly unjust for this court on appeal to characterize the case as one brought under the statute solely to collect, assessments. If objection had even been made to the filing of the cross-bill, the case might be different, but we cannot perceive how the case still retains its character solely as a suit to collect assessments under the statute, when both parties by their pleadings made it a suit to test the validity of the district, and the court below so treated it.

The chancery court had jurisdiction of a suit to test the validity of the district, and, the parties having submitted themselves to the jurisdiction of the court in such a suit, and the court below having treated it as a suit to test the invalidity of the district, and having decided the issues thus raised, we think that the statute governing appeals in general should control, instead of the special statute relating to appeals upon proceedings to collect assessments.

Therefore Judge Wood and the writer respectfully dissent.


author: Wood, J.

text:
    Millar v. Mauney.
    Opinion delivered October 17, 1921.
    1. Mines and minerals — implied covenant to develop mine. — In a lease of lands for the purpose of exploring for diamonds and other precious stones and minerals upon a royalty basis, there is an implied covenant on the part of the lessee that he will with proper diligence search the land described in the lease for minerals and develop the same.
    2. Mines and minerals — abandonment of lease. — Where the conduct of the lessees in mining leases, given in consideration of a royalty to be paid, is such as to show that the lessees do not intend in good faith to perform the covenants by which they are bound, they have, in legal effect, rescinded those covenants and released the lessors from the obligations of the contract, and the latter are justified in treating the contract as rescinded.
    3. Mines and minerals — abandonment—remedies of lessor.— Where a lessee in a mining lease, the consideration of which is a royalty to be paid, has, after a reasonable time, failed to begin and to continue the work of development and exploration provided in the contract, the lessor has three remedies, viz., (1) he may sue in equity to cancel the contract and recover incidental damages; (2) he may sue at law for damages for breach of the contract; or (3) he may treat the contract as rescinded and sue at law to recover possession of the property leased.
    4. TkiAL — transfer to equity. — Where the lessors in a mining lease in an action at law sought to recover the leased property, alleging that the lessees had abandoned the lease, allegations in the answer that the lessors had annoyed and harassed the lessees by lawsuits and otherwise and prevented them from fulfilling their contract held not sufficient to entitle the lessees to have the cause transferred to equity or to have injunctive relief against interference with the property.

      5. Evidence — relevancy.—Where the lessors in a mining lease alleged a breach of the covenants therein by reason of non-performance of the contract on the lessees’ part since a certain date, it was not error to refuse to permit the lessees to prove due diligence on their part prior to that date.
    6. Evidence — relevancy.—It was not error to permit lessors of a diamond mine, seeking to enforce a forfeiture for nonperformance of the lessees, to prove what might have been accomplished by the lessees in testing the extent of the “hardibank” by a diamond drill, instead of by shaft, such testimony being relevant on the issues of diligence and good faith of the lessees.
    7. Mines and minerals — forfeiture of lease for nonperformance. —Where the lessors, by their conduct in instituting law suits or otherwise, put obstacles in the way of the lessees which caused them to fail to perform their covenants, the former would be estopped from setting up an abandonment or forfeiture by the lessees.
    8. Mines and minerals — lease—abandonment.—The good intentions of a lessee in a mining contract given on a royalty basis will not avail him unless he has the ability to perform, and actually does perform, the covenants of his contract within a reasonable time; and he will be held to have abandoned his right or privilege if he, without fault of the lessor, is unable after a reasonable time to perform such covenants.
    Appeal from Pike Circuit Court; James S. Steel, Judge;
    affirmed.

      Tomplcins, McRae & Tomplcins and Fordyce, Holiday é White, for appellants.
    The court erred in refusing to transfer the cause to chancery. Cancellation of instruments is a recognized ground of equity jurisdiction. 96 Ark. 251.
    The lease contained no clause for forfeiture. It was error to overrule defendant’s demurrer. A law court cannot order a forfeiture. 41 Ark. 532; 24 Cyc. 1349, citing cases; Wood, Landlord & T. p. 453; 1 Underhill, Landlord & T. p. 625; Tiffany, Landlord & T. p. 1366.
    Forfeitures are regarded with disfavor. Ordinarily where forfeitures are desired they are expressed in the contract. 100 Ark. 568; 125 Ark. 110.

      Rose, Hemmgivay, Cantrell & Loughborough, and W. C. Rodgers, for appellees.

      This was not an action to cancel an instrument. It was an action to recover land. The cause should not have been transferred. When the tenant’s term expires from any cause, the landlord may 'bring ejectment. Wood, Landlord & T. § 571.
    While forfeitures are not favored, equity will cancel a contract where there is an abandonment of performance. 100 Ark. 568.
   Wood, J.

This action was instituted by the appellees against the appellants in the Pike Circuit. Court April 20, 1920, to recover the possession of certain lands alleged to contain diamonds. The appellees alleged in substance that the appellee Bettie L. Mauney is the widow, and that the other appellants are the children and sole heirs at law of M. M. Mauney, deceased, who leased the lands in controversy in 1912 to the appellants; that the lease was for a period of fifty years, beginning January 1, 1912. There was a condition in the lease that the lessee, his associates and assigns, undertake “to diligently and faithfully” prosecute the work of development of the property as outlined in the lease in a scientific and practical manner * '* * by taking such preliminary steps toward the preparation of plans and purchases of machinery necesary to carry on the work in contemplation, and to erect and install a modern washing and concentrating plant of African type within one year from April 10, 1912, and in good faith and with diligence to treat and wash for the recovery of diamonds and other precious stones a minimum of 10,000 loads of material from the first-described tract of land known as the Mauney diamond property during each and every year of this lease, and as much more as can reasonably be done, a load being a unit of measure and sixteen cubic feet. The lease also provided that the lessor should have one-fourth of all diamonds and other precious stones and valuable minerals recovered from the land. The lessees were to have the management and sale of the diamonds, and every three months the lessees should fix a price for the product of the mine, and the lessor was given the right to buy the diamonds by paying to the lessees three-fourths of the price thus fixed. If no price was fixed, the output was to be sold to the lessee, and one-fourth of the proceeds of the sale was to be paid to the lessor..

The complaint further alleged that the lessees “covenanted and agreed with the lessor that the operation Undertaken shall be prosecuted and carried on in good faith and with loyalty and fidelity to all the parties to the lease, and agreed to furnish the lessor an accurate statement of the number, character, quality and weight of all diamonds and other valuable minerals taken from said mine, together with quarterly statements of sales made, with payment in full for all royalties due to the lessors under the lease contract;” that since the 27th of April, 1918, no reports of the recovery of diamonds had been made nor an opportunity given the lessors to purchase the output, nor had the lessees washed and treated as much as 10,000 loads of material; that the property had been in possession and under the control of the appellants before and since April 27, 1918; that appellants were holding the same under and by virtue of the lease mentioned, and upon no other ground whatever. The concluding portion of the complaint is as follows:

“That the defendants have not substantially complied with said contract; that they have, on the contrary, refused to even attempt to carry out the terms thereof in good faith as required thereby; that they have lain idle and ceased operations ever since April 27, 1918 to the time of filing this complaint (April 1920); that they have not recovered any diamonds in that time,' although during the year 1914 they reported the recovery of several hundred diamonds, and hundreds in other years prior to April 27, 1918. That the plant on the site at Kimberly was burned on or about January 13, 1919. since which time, as well as before, there has been no effort on the part of the defendants to operate in good faith under said contract; that they have abandoned all work under said contract, and are arbitrarily and •rnaliciously holding possession of said land mentioned in said lease contract without right and in violation of the rights of the plaintiffs to the full enjoyment thereof, and to any benefit they may have by reason of operating or controlling said mine themselves, or having others to do so who will be faithful to such contracts as the plaintiffs might enter into.
“The defendants have done no work in the said Mauney mine since April 27, 1918, and have not attempted to do any since said time. On the contrary, they'have abandoned the said mine and the operation and development thereof completely and in every way since April 27, 1918, since which date they have failed, neglected and refused to substantially comply with and conform to the requirements of said lease, and by reason of the abandonment thereof as herein set'forth, they have ever since April 27, 1918, lost and forfeited all right of possession of said land mentioned in said lease and supplement thereto. That the plaintiffs are owners of all of said land and entitled to the possession thereof.”

The lease was made an exhibit to the complaint. The appellants answered and set up that, subsequent to the lease, there was an agreement by which the written reports required in the lease were dispensed with and it was agreed that the diamonds should be divided in kind. They allege that the diamonds already recovered had, by order of the chancery court in a former suit, been brought into court and held there until May, 1920, when they were delivered back to the appellants, and that appellants had been trying to divide the diamonds ever since, and' had tendered them in a suit pending between the parties in federal court. The answer alleged that, under the terms of the supplemental lease, the parties were authorized, when it became necessary to make a change to underground system in mining, to have such time as was necessary for so doing without forfeiting the lease; that in 1917 appellants determined that it was necessary to resort to underground mining, but that by reason of the war with Germany they could not secure the necessary labor for doing tbe necessary excavation and running the washing machine until the 13th of January, 1919, when the plant was destroyed by fire of incendiary origin. They admitted that since April, 1918, they had not washed as much as 10,000 loads of dirt, and alleged that they were not required to do so. They alleged that, ever since the making of the lease, the appellees had persistently and without right constantly engaged them.in litigation, having filed against them more than thirty separate suits, all of which have been decided adversely to the appellees; that, notwithstanding the annoyance and harassments, appellants had expended more than $150,000 in undertaking to develop the mine; that the product of the mine for the last three years has been tied up by the court at the instance of appellees, who had refused to fix a price upon them or to divide them as provided by the verbal agreement made in 1916; that it will cost a quarter of a million dollars to reconstruct the plant, and that, by reason of the annoyance and harassments caused by the appellees, the appellants had been hampered in making their necessary financial arrangements ; that tlieir labor had been disorganized, and that one of the appellees sought to assassinate two of the appellants on the public highway; that diamond-bearing dirt had been uncovered on about five acres of the mine, and that appellees had wrongfully engaged the appellants in litigation for the purpose of fraudulently undertaking to secure a cancellation of the lease for the purpose of appropriating to the use of the appellees the labor and expenditures of appellants; that appellants during the last seven years had not had as much as three months free from litigation iir which to undertake the development of the mine; that the mine is in the shape of a V with the point extending toward the south, and the northern part of the mine is covered by non-diamond bearing rock, the extent of which is not known, and cannot be known, until the appellants are permitted to sink a shaft to determine how far down this rock extends. The answer concluded with a prayer that it be taken as a cross-bill, and that'the court fix a reasonable time within which the appellants may peacefully pursue the prosecution of the work, and that until that time expires appellees be restrained from further proceedings.

Embodied in the answer was a general demurrer which challenged the sufficiency of the complaint to state a cause of action, and also the jurisdiction of the court. There was also a motion to transfer the cause to the chancery court. The demurrer and motion to transfer were overruled, and the cause was sent to the jury to be beard on the evidence and the instructions. Such other facts ns may be necessary will be stated as we proceed. The trial resulted in a verdict and judgment in favor of the appellees, which judgment appellants are seeking to reverse on the following grounds:

That the complaint did not state a cause of action giving the trial court jurisdiction, and that the court therefore erred in overruling the demurrer. The contract set up in the complaint does not create the ordinary relation of landlord and tenant. It is not a contract by which the lessees are to occupy the property for residence, mercantile, manufacturing or agricultural purposes, and in which the lessor, landlord, receives a certain stipulated sum for one month or one year for the use of the premises leased. But it is a contract for the exploration and development of the leased lands “for diamonds and other precious stones and valuable minerals.” As compensation for the use of his lands for such purposes, the lessor receives by way of rental or royalty a certain percentage of the output from the development of the leased property. In other words, this is strictly a lease for “mining purposes,” such as was under consideration by this court in the case of Mansfield Gas Co. v. Alexander, 97 Ark. 167. In that case we said: “In the construction of mineral leases such as is involved in this case, the authorities uniformly hold that there is an implied obligation on the part of the lessee to procceed with the search and also with the development of the land with reasonable diligence according to the usual course of such business, and that a failure to do" so amounts in effect to an abandonment and works a forfeiture of the lease.” And further: “According to the uniform holding of the authorities, the law will read into this lease a covenant on the part of the lessee that it will with due and proper diligence search the land described in the lease for minerals and with due and proper diligence develop the same. This implied covenant is in effect a condition upon which the lease was made; a failure or refusal to perform that condition results in a forfeiture of the lease.”

In the above case many authorities are cue! to support the rule announced therein. The same doctrine is announced in an action in equity brought by the Mauneys to cancel the lease involved herein. Mauney v. Millar, 134 Ark. 15-21, and also in Millar v. Mauney, 142 Ark. 486-490. See also Mansfield Gas Co. v. Parkhill, 114 Ark. 419. Although the above doctrine was enunciated in suits in chancery to cancel the lease, it is. equally applicable in actions at law to recover the possession of the property if there has been such a failure on the part of the lessees, still in possession, to observe the covenants by which they are bound as to be tantamount to an abandonment of those covenants and a consequent forfeiture of all their rights under the contract. If the conduct of the lessees in contracts of this nature is such as to show that they do not intend in good faith to perform the covenants by which they are bound, then they have, in legal effect, rescinded those covenants and released the lessors from the obligations of the contract, and the latter are justified likewise in treating the contract as rescinded.

As was said in Huggins v. Daley, 99 Fed. 606-613: ‘ ‘ Such leases vest no present title in the lessee, and if, at any time, the lessee has the option to suspend operations, the lease is no longer binding on the lessor because of want of mutuality; and, where the only consideration is prospective royalty to come from exploration and development, failure to explore and develop renders the agreement a mere nudum pactum, and works a forfeiture of the lease, for it is of the very essence of the contract chat work should be done.” The reason for the rule is that where the lessor receives as royalty or rental a certain percentage of the output of the lands as his only compensation for their use by the lessee for exploration and development, when such work ceases, his compensation ends, and the consideration for the lease fails. In such contracts the lessee usually expressly undertakes, as was the case here, to “diligently and faithfully prosecute the work of development, ’ ’ and, if there is no express covenant to that effect, as we have seen, such a covenant will be implied from the very nature of the contract. Unless it is otherwise provided in the lease, it is always in the contemplation of the parties to such a contract that the lessee is able, financially and in every other way, to perform his undertakings in the time and manner specified in the contract. If, after a reasonable time, he fails to begin and to continue the work of development and exploration provided in the contract, but nevertheless holds possession and exercises control over the leased lands for promotion purposes or financial exploitations, he has by such conduct worked a forfeiture ol his rights under the lease and may thereafter be treated as having abandoned his contract and as holding the land as a trespasser adversely to the lessor. In other words, the lessee under such a contract will not be allowed to speculate upon the chance of being able at some indefinite and unreasonable time in the future to begin and to continue the work of exploration and development required of him under the covenants of his contract. When the contract has been thus virtually rescinded and abandoned by the lessees, the lessors have three remedies, either of which they may pursue. They may go into a court, of equity to cancel the contract and recover any incidental damages; they may in a separate action at law sue for damages for breach of the 'contract; or they may treat the contract as rescinded and sue to recover possession of the property. 1 Pomeroy’s Equity Jurisprudence, § 110. That an action at law by the lessor to recover possession of the property leased is an appropriate remedy in such cases is well sustained by the authorities. Aye v. Philadelphia Co., 193 Pa. St. Rep. 451; Paine v. Griffiths, 86 Fed. 452, 38 Atl. Rep. (N. J. Law) 813. See also Acme Oil & Mining Co. v. Williams, 74 Pa. 296 and cases there cited. 1 Pomeroy’s iniquity Jurisprudence, supra; White, Mines & Mining, § 425. We conclude, therefore, that the appellees had the right to institute this action at law to recover the possession of the lands in controversy. The allegations of the complaint are sufficient to state a cause of action, provided they state facts showing an abandonment of the lease contract by the appellants.

We will not repeat here all the allegations of the complaint. Among othei' allegations are the following: “That at no time since April 10, 1918, have the defendants washed and treated for the recovery of diamonds as much as 10,000 loads of material from the said Mauney mine, and they have done no work in the said Mauney mine since April 27, 1918, and have not attempted to do any since said time; that at no time since April 27, 1918, have the defendants, or any of them, reported to these plaintiffs, or any of them, the recovery of any diamonds or other precious stones; neither have the defendants, or any of them, given these plaintiffs, or any of them, an opportunity to buy the output of said mine at any time since April 27,1918. ’ ’ These and other allegations in the complaint were sufficient, if true and undenied by the. appellants, to constitute a cause of action at law against the appellants for the abandonment of the contract. On demurrer we must treat all the allegations, properly pleaded, as true and admitted. The court was correct therefore, in overruling the demurrer to the complaint.

The answer of the appellants contained allegations which, in effect, denied or completely explained all material allegations of the complaint and showed that there had been no abandonment by them of the property. They admitted that they had not since April, 1919, washed as much as 10,000 loads of dirt, and alleged that by the terms of the supplemental lease they were not required to do so. They alleged that their washing machinery was destroyed by fire of incendiary origin on January 13, 1913; that the product of the mine had been tied up in the courts on account of litigation at the instance of the appellees, who had refused to fix the price of the product or to divide them; that appellants had not made reports and divisions of the output of the mine as provided in the contract because there was a subsequent verbal agreement entered into in 1916 which made the same unnecessary. They alleged generally that in a litigation of more than thirty separate suits filed by the appellees against the appellants, all of which had been decided adversely to the appellees, the appellants had been subjected to annoyance and harassment of various kinds, including intimidation of their labor, and an attempt by the appellee to assassinate two of the appellants, all of which was for tha purpose of fraudulently undertaking to secure a cancellation of the lease and requiring the labor expended in undertaking to develop the mine with a view of appropriating it to their own use and benefit; that during the last seven years appellants had not had as much as three months free from litigation in which to undertake the development of the mine. They set up that, notwithstanding the litigations, they had made large expenditures in undertaking to perform the contract on their part. In short, they denied that there had been an abandonment of their contract, and alleged on the other hand that they in good faith had performed and intended to perform all of their covenants under said contract. They made their answer a cross-complaint and asked, by way of affirmative relief, that they be allowed to peacefully prosecute their work under the contract for at least one year, and that the appellees be restrained from proceeding against them during such time.

It is unnecessary to discuss in detail all of the allegations in appellants’ answer. Such of them as were relevant were sufficient to. raise the issue as to whether or not the appellants had abandoned their contract, but they were not sufficient to entitle appellants to have the cause transferred to the chancery court, and to entitle them tc the injunctive relief which they prayed.

The appellants do not allege any specific facts in their answer to show in what manner the various suits instituted by the appellees against them had operated to interfere with, the performance of their covenants under said contracts since April 27,' 1918. The allegations of the answer show that all suits prior to April 27, 1918, as well as the suits instituted on that day, had been determined in appellee’s favor, and they do not allege specific facts showing how the suit of April 27, 1918, which was decided in their favor by this court on March 8,1920, had prevented the appellants in the meantime from carrying out their contract. Such facts properly pleaded, if proved, would be a complete defense on the issue of abandonment. Moreover, a court of equity has no power to restrain the appellees from seeking re’dress in a court of law for an alleged abandonment by the appellants of the contract under review and the resultant forfeiture of their alleged rights thereunder. Counsel for appellants have not cited us to any authority, and we do not know of any, which holds that a court of equity has such power. Such of these matters as were pertinent appellants could allege and prove in their defense of the action at law on the issue as to whether there had been an abandonment by them of the contract. But appellants could not by such allegations lift the action at law out of the jurisdiction of the law court and have the same transferred to the chancery court. The court was therefore correct in overruling the motion to transfer.

Appellants complain because the trial court refused to permit them to.prove that, beginning with April 1913, about a year after the lease contract in controversy was executed, the appellees instituted a suit against them to cancel the lease, and since that time to the time of the present action had 'been in litigation with the appellants aggregating more than thirty-five suits, all of which, before this action was instituted, had been decided adversely to the appellees; that the effect of these suits had been to disorganize their labor and make it impossible for them to secure financial assistance, and that but for these suits the testing’ of the mine would have been completed; that these suits had cast a cloud upon appellants’ title and had deterred parties who had promised them financial assistance from rendering such assistance, and that all this testimony was competent as tending to prove that the appellants in g’ood faith had endeavored to carry out their lease contract and had not before or since April 27, 1918, abandoned the same.

The appellants alleged in their answer that all litigation prior to the present action had been decided in their favor. In the case of Mauney v. Millar, 134 Ark. supra, we said: ‘ ‘ Eight of action in this case, if there is one, extends back no further than the last of the adjudications thereof, and must be tested solely by testimony tending to show a breach of the contract since that time. ’ ’ That case was decided April 22, 1918, and on April 27, 1918, the last suit, the one just prior to the present action, was instituted and disposed of on March 8,1920. A little more than a month thereafter, April 20,1920, the present' suit was instituted.

In the present action the appellees do not claim that there had been any abandonment of the contract prior to April 27, 1918, and only assert that appellants since that time had “lain idle and ceased operations,” and thus had completely abandoned the mine and the performance of their covenants under the lease contract. In one of its instructions the court told the jury that “the burden is on the defendants to show by a preponderance of the evidence that the shooting of Walter Mauney, or the pend-ency of suits during the period from April, 1918, to April, 1920, actually hindered or delayed the lessees in the performance of the contract, and, unless you find that they did delay or hinder the lessees in perf orming the contract, you should disregard the testimony as to such shooting and such suits.” . The court allowed the appellants in their testimony to cover all the time between the 27th of April, 1918, and April 20,1920. That embraces the period of the alleged abandonment of the contract by the appellants. The court gave the appellants the privilege of proving by competent testimony what had been the effect, if any, of the suits instituted by the appellees against appellants, since April 27,1918, in the matter of interfering with-, or putting obstacles in the way of appellants’ performance of their contract. For instance, the court ruled that defendants (appellants) “may prove any injury to their credit by the bringing of the libel suits since April, 1918, up to the bringing of this suit, the effect they had upon their labor, and upon capital or borrowing of money. ’ ’

Since the appellees, by the present action, have not challenged the loyalty and fidelity of appellants to their contract obligations prior, to April 27, 1918, it occurs to us that it would not be germane to the issues in this case to prove that appellees had not fulfilled their covenants, nor that appellants, in good faith, had kept theirs to April 27, 1918. Such matters were beyond the scope of the issue in the present action, and the court correctly so ruled.

The court likewise did not err in admitting testimony tending to prove what might have been accomplished by appellants in testing the extent of the “hardibank” by a diamond drill, instead of by shaft. -This testimony was relevant on the issues of the diligence and good faith of ■appellants. We find no error in-any of the rulings of the court in admitting or excluding testimony.

As to the law of the case, but little need be added to. what we have already said in passing on the demurrer and motion to transfer. Since the instrument herein did not convey or grant to appellants any legal title or estate in the land itself, but only the privilege or right of possession for the purpose of mining, the appellants could abandon such right or privilege by a failure to perform their covenants for exploration and development as specified in the lease. See 1 Cor. Jur. p. 10, § 14. Good faith is required of both parties in the observance of their covenants. If the appellees, by their conduct in instituting lawsuits or in any other manner, put obstacles in the way of appellants which caused them to fail to perform their covenants, then the appellees would be estopped from setting up an abandonment or forfeiture by the appellants.

The good intentions of the lessee in such contracts to perform the same will not avail him unless he also has the ability to perform, and actually does perform, the covenants of his contract within a reasonable time. To abandon means to quit; usually the voluntary relinquishment of a right or privilege which one enjoys. But in cases like this the lessee will be held to have abandoned his right or privilege if he, without fault on the part of the lessor, is unable after a reasonable time \o perform the covenants of his lease. Abandonment is ordinarily a mixed question of law and fact. White, Mines and Mining, p. 561, § 423. It was so here. It cannot be said that the undisputed evidence showed that appellants had not abandoned, nor can it be said as a matter of law that they had abandoned and forfeited, their rights under the lease. The issue of fact in this case was therefore one peculiarly for the jury to determine from all the facts and circumstances adduced in evidence under the guide of appropriate instructions from the trial court. The instructions of the court show that it understood and correctly interpreted the contract. Its charge, as a whole, fully and fairly covered every phase of the evidence. These instructions but declared elementary and familiar principles of law applicable to the particular facts which the testimony adduced tended to prove in support of the contentions of the respective parties. There is no error in the rulings of the circuit court, and its judgment must therefore be affirmed.

Smith, J., dissenting.