text:
    Indemnity Insurance Company of North America v. Krone.
    Opinion delivered July 9, 1928.

      Cravens & Cravens, for appellant.

      Earl U. Hardin and W. L. Curtis, for appellee.
   Wood, J.

This was an action instituted ¡by Cus Krone, doing business as Southern Cigar & Candy Company (hereafter called, for convenience, Krone) v. J. D. Wheeler and the Indemnity Insurance Company of North America (hereafter called company). Krone was in the cigar and candy business in Fort Smith, Arkansas. Wheeler was employed by him as bookkeeper and cashier. The company executed an indemnity bond to Krone in the sum of $2,000, indemnifying Krone against any loss which he might sustain by reason of larceny or embezzlement committed by Wheeler against Krone during a period of one year, beginning March 14,1926, and ending March 14, 1927. The cause was submitted to a jury. It was proved by the undisputed testimony on the part of the plaintiff that Wheeler, during the period covered by the bond, did steal or embezzle from Krone $2,646.03.

The court, over the objection of the company, permitted the introduction of the following:

“Fort Smith, Arkansas, June 7, 1926. I, Joe D. Wheeler, of my own will and accord, do hereby acknowledge and admit that I did steal and use for my own use the sum of $2,646.03 from the Southern Cigar & Candy Company during the fall and summer of 1925 and the winter of 1925 and the spring of 1926. (Signed) J. D. Wheeler.” On typewriter: “Jno. I). Wheeler. Witness: W. ft. Johnson, John Arch, Yance Hill.”

To this, ruling the company dnly excepted.

Among other prayers for instructions the company presented the following:

“No. 2. Yon are instructed that if you believe, from a preponderance of the evidence in this case, that the plaintiff, without previous notice to and the consent of the defendant, Indemnity Insurance Company of North America, in writing, made any settlement with J. D. Wheeler for any loss under the bond sued on herein, or that the plaintiff did any act whereby the liability of the said J. D. Wheeler to the plaintiff was changed in any material respect, then you are instructed that your verdict should be for the defendant; and in this connection you are further instructed that the acceptance by the plaintiff, if any, of a certain amount of cash from the said J. D. Wheeler, if any, and the acceptance of a note, if any, of the said J. D. Wheeler et al., which said cash and note was to apply on the alleged shortage of the said J. D. Wheeler, if it was to be applied to the plaintiff, if any, would be such a chang’e in the liability of the said J. D. Wheeler to the said Grus Krone as would be material. ’ ’

The court refused the above prayer for instruction, to which ruling the company duly excepted.

The court granted the following prayer of the company :

“You are instructed that if you believe, from a preponderance of the evidence in this case, that the plaintiff, without previous notice to and the consent of the defendant, Indemnity Insurance Company of North America, in writing, made any settlement with J. D. Wheeler for any loss, under the bond sued on herein, or that said plaintiff did any act whereby the liability of the said J. D. Wheeler to the plaintiff was changed in any material respect, then you are instructed that your verdict should be for the defendant.”

At the instance of Krone, the court gave the following instruction:

“You are instructed that if you find from the testimony that the defendant surety company was present by its attorney and acted in conjunction with attorney for plaintiff in trying to effect a settlement or to obtain reimbursement from J. D. Wheeler, or his estate, or.third person, for the money alleged to have been stolen or embezzled, such action upon the part of the plaintiff would not constitute a breach of the conditions of the bond which provides for written notice to the surety company of the intended effort to effect settlement.”

To this, ruling, the company duly excepted.

The company answered the complaint, and denied liability. The defendant, Wheeler, although duly served with summons, did not answer. Judgment was rendered against him by default in the sum of $2,553, the jury having- returned the verdict against him for that sum. The jury returned a verdict in favor of Krone against the company in the sum of $2,000. Judgment was entered in favor of Krone against the company for that sum, from which the company appeals.

1. The court did not err in allowing Krone to introduce the written confession of WTieeler set out above. There are two reasons why this confession was admissible: first, because it was of the res gestae. The very terms of the bond made the company liable for loss to Krone “caused by any act of larceny or embezzlement upon the part of the employee in the performance of the office or position in the service of his employer and occurring during the continuance of this bond, and discovered at any time within six months after the expiration or cancellation of this bond. Tbe larceny or embezzlement of Wheeler, .as shown by his written confession, was while he was still in the employ of Krone as cashier and bookkeeper, during the period covered by the bond. The plaintiff, Krone, could not recover against the company unless he proved that Wheeler was guilty of embezzlement, and, as said by us in the recent case of Fidelity & Deposit Co. of Maryland v. Cunningham, ante, p. 638, it was competent in the trial of this cause to prove his admission. ’ ’ In that case the plaintiffs sued the surety and the principal on the ’bond, in which there was a joint and several liability of the principal in the bond and the surety, whereas in this case there was no joint and several liability of principal and surety expressed in the bond. But in that case the bond, as in the case at bar, made the surety liable for loss to the obligee by reason of any personal act or acts of larceny or embezzlement committed by the principal in the discharge of his duties in his official position. The matter essential to be proved in that case, as in the case at bar, before the liability of the surety attached under the bond, was the fact of the larceny or embezzlement of the principal in the discharge of the duties of his official position. Hence the doctrine of that case is clearly applicable here as to the admissibility of the confession of the principal as showing his embezzlement.

The undisputed testimony shows that the confession of the principal was made while he was still in the employ of Krone, and was in response to inquiries made by him of Wheeler concerning the defalcation, of which Krone suspected he had been guilty. It will be observed that the language of the bond itself contemplated that the company would be liable for any larceny or embezzlement committed by Wheeler during the continuance of the■ bond, if such larceny or embezzlement were discovered unthin six months after the expiration or cancellation of the bond.

Now, any larceny or embezzlement committed by Wheeler during the period covered by the bond, to the extent of $2,000, is a liability against the company on its bond. Any admission or confession of such larceny or embezzlement, in response to an inquiry, made by the obligee, during the period covered by the bond, is. a part of the res gestae, because the bond itself contemplates that discovery may be made of such dereliction of the principal, and, as before stated, one of the most effectual methods of discovery is the voluntary confession of the principal. As. casliier and bookkeeper, it was certainly a part of Wheeler’s business to account for the funds of his employer coming into his hands, and it was in the course of such business or employment for him to give an account to his employer, when requested or required by him to do so. Therefore, when Wheeler was requested by his employer to give an account of the funds which he had handled for him, his confession that he had stolen such funds is certainly of the res gestae in any inquiry involving the issue as to whether such funds were embezzled or stolen by Wheeler during the period covered by the bond. As we construe the written confession of Wheeler, in connection with the testimony of Krone, it was but tantamount to an accounting to Krone for the money that had come into his (Wheeler’s) hands as cashier. Krone certainly had the right to demand of Wheeler, while the relation of employer and employee still existed, to render an account of his stewardship; and when Wheeler, in rendering an account to Krone, stated the amount of funds which had come into his hands, and that he had stolen such funds, his confession was a part of the act of accounting. As we take it, the statement of the principal (Wheeler) of the amount of funds that had come into his hands belonging to Krone and his confession that he had stolen the same, was during and in the course of his employment and in the line of his duty, and was therefore of the res gestae in this action by Krone against Wheeler and the surety on his bond.

Mr. Elliott states the law which is precisely applicable^ the facts of this record as follows:

‘ ‘ The ¡admissions of the principal are not ordinarily admissible against his surety, unless they are a part of the res gestae. Where, however, the admission of the principal involves his own conduct, and is made during the transaction of the business for which the surety is bound, such as an admission accompanying litigated ¡acts or made by the principal pursuant to a request for information which it was his duty to answer in the discharge of his office, or the like, so as to be properly part off the res gestae, it is receivable against the surety. But it is not necessarily conclusive in an action against the latter. It has been held, however, that the admission of a surety in a suit against both principal and surety is receivable lagainst the principal as well as against the surety. ’ ’ 1 Elliott, § '253.

In Guaranty Co. of North America v. Phoenix Ins. Co., 124 Fed. 170, 59 C. C. A. 376, it is said: “The admission of a servant, the principal, in an employee’s bond, with respect to matters pertaining to his guaranteed duties, made while he is engaged in their discharge, is competent evidence lagainst the surety on his • bond. ’ ’ Many cases are cited to sustain the opinion. See also Bailey v, McAlpin, 122 Ga. 616, 50 S. E. 388; also Bank of Brighton v. Smith, 12 Allen 243, 90 Am. Dec. 144.

But, on the other hand, if the statement of Wheeler, above set forth, had been made after the period covered by the bond had expired and after the relation of employer and employee had ended and in response to an inquiry made by Krone as to whether Wheeler had embezzled funds while he was Krone’s cashier, then such statement unquestionably would not be of the. res gestae, for the reason that it would not be a statement made while in the course of his (Wheeler’s) employment land while in the performance of his duty as cashier. Such statement would then be but the narrative of a past transaction and not of the res gestae, and therefore not admissible. The declarations of a principal made subsequent to the act to which they relate, and not made during the transaction of the business (for which the principal is bound, are not of the' res gestae, and would not be competent and relevant testimony in an action alone against the surety. There is really no conflict in the authorities on these well established rules of law; but, as is said in Dietrich v. Dr. Koch Veg. Tea Co., 56 Ok. 636, 156 Pac. 188, “the difficult proposition is not to lay down the.law, but to apply it. It is easy to say that, if the admissions of the principal constitute a part of the res gestae, they would be admissible against a surety, otherwise not.” But it is by no means an easy problem to determine always, as we have found in this case, just when the admission of a principal in an action against the surety is of the res gestae. However, we are convinced that the statement of Wheeler was admissible as of the res gestae, for the reason, as stated above, that he made the confession in response to his employer’s investigation and inquiry for an accounting, while he was engaged in the performance of his duty las cashier and bookkeeper, to render an account for the funds he had received land the disposition made thereof. These facts, we believe, make the statement and confession a part of the res gestae, and therefore admissible. While the facts are different, the rule of law is recognized and stated in State v. Newton; 33 Ark. 276, 289, where we said, “the surety is bound by the acts and declaration of his principal, being within the scope of the business, as a part of the res gestae;” and in Williams v. Elrod, 128 Ark. 207-210, 193 S. W. 514, we held that the declarations of an agent or employee relating to a transaction in which he had real or apparent authority to act, and during the very transaction in which he was engaged, is of the res gestae.

We concede that the case of Stetson v. City Bank of New Orleans, 2 Ohio St. 167, upon which counsel for appellant rely to sustain their contention that the confession of Wheeler was not a part of the res gestae, is a thoroughly considered case upon the subject under review; but, while the court announces the correct doctrine of law, it occurs to us it misapplied it to the facts of that case. Por we are convinced that the admissions or confessions of the principal in that case as to the extent of his defalcation, made to the other officers of the bank, while he was still cashier, were in the very line of his duty and during the course of his employment, and should have been admitted as a part of the res gestae, and binding on his surety, while the confessions made after his employment had ended were not of the res gestae.

The second reason why the statement wias admissible in this case is because the action was against both the principal and the surety. While the principal did not appear and answer, he was not dropped .from the action, but it was prosecuted through to a final judgment as a joint action against him and the appellant, his surety. The statement adduced was relevant testimony to establish the amount of his liability, and, to the extent of the bond, the liability also of the appellant as his surety. When the suit is against the principal and surety jointly, on a joint or joint and several obligation, an admission or declaration of the principal which is competent evidence against him is also generally held to be competent evidence against the surety. See Brandt, Suretyship and Guaranty, 295. The liability here was joint to the amount of $2,000.

In Singer Mfg. Co. v. Reynolds, 168 Mass. 588, 47 N. E. 438, 60 A. S. R. 417, Reynolds was the principal in a bond given for the faithful performance of his duties as an employee of the plaintiff corporation. Leonard was the surety on his bond. Reynolds made a statement, during the period covered by the bond, precisely similar in effect to the statement made by Wheeler in the case at bar. The plaintiff corporation instituted a joint action against Reynolds and Leonard, his surety, to recover the money which Reynolds, in his written statement, admitted he had received as agent of the corporation, and had embezzled. The trial court admitted the statement of the principal, over the objection of the surety, and the Supreme Court of Massachusetts held that the ruling was correct, saying: ‘ ‘ The admission of the principal was, under our decisions, admissible against both. ’r Such is the effect of our recent holding in Fidelity & Deposit Co. of Md. v. Cunningham, supra. See also Rotan v. Nichols, 22 Ark. 245, where we announced the principle that “the admissions of a person united in interest with a party to the suit are admissible in evidence against such party.” Citing 1 Greenleaf on Evidence, § 171. The confession of Wheeler, being freely and voluntarily made, is conclusive against him if made in good faith, and it is at least prima facie evidence against the appellant, his surety, because they are his privies in law and jointly liable with him to the amount of the bond. See Stevens v. Crawford, 1 Ga. 574, 44 Am. Dec. 680; also Dietrich v. Koch Veg. Tea Co., supra.

2. The bond upon which the action was founded contained the following pro vis ion: If, without previous notice to and consent of the surety thereto in writing, the employee in his employment, after having become aware of any act which ¡may be made the basis of any claim hereunder, or make any settlement with any employee for any loss hereunder, or do any act whereby the liability of the employee to him is changed in any material respect, this bond shall be null and void, both as to any existing or future liabilities hereunder.” Without setting out and commenting upon the issue as to' whether Krone had made a settlement or done any act without the consent of appellant, whereby the liability of Wheeler to Krone was changed in any material respect, it suffices to say that, after a careful consideration of the testimony on this branch of the case, we are convinced that it was an issue for the jury as to whether such a settlement had ¡been made or act done. This issue was submitted to the jury in appellant’s prayer for instruction No. 3, which the court granted. The appellant’s instruction was couched substantially in the language of the bond. The court, having granted the prayer of the appellant, did not err in refusing appellant’s prayer for instruction No. 2, covering the same issue. Appellant’s prayer for instruction No. 3 was not argumentative, and was a correct declaration of law on the issue raised under the terms of the bond above set forth. Our conclusion is that this prayer presented the issue in terms as favorable to appellant as it was entitled to under the evidence.

Appellant’s prayer for instruction No. 2 was argumentative, and invaded the province of the jury. The court ruled correctly in refusing such prayer, especially in view of the fact that the court granted appellant’s prayer No. 3, covering the same matter, hut not in an argumentative form. Under the controverted facts -adduced in evidence the court did not err in refusing to tell the jury as a matter of law that the acceptance of a certain amount of cash from J. D. Wheeler, if any, and the acceptance of the note, if any, of J. D. Wheeler et al., was a change in the liability of Wheeler to Krone which would be material as affecting the liability of appellant to Krone under the terms of the bond. If such a settlement had been made by Wheeler with Krone, appellant does not prove that this would change Wheeler’s liability in any material respect, that is, in any respect that would be detrimental to appellant. Appellant, does not prove or attempt to prove that any alleged settlement between Wheeler and Krone would result in any loss or damage to the appellant, and it is difficult to see how it could be otherwise than beneficial to appellant. Therefore the appellant is not prejudiced, and is not in an attitude to complain when the -court refused to grant an argumentative instruction -on this issue, after having presented the issue at appellant’s request in almost the ex-act language of the appellant’s bond, upon which the alleged liability of appellant is predicated.

There are no reversible errors in the rulings of the trial court. The judgment therefore must be affirmed.


source: Caselaw Access Project

author: Smith, J.

license: Public Domain

text:
    Thomas v. Magnolia Petroleum Company.
    Opinion delivered July 9, 1928.

      D. T. Cotton, Watkins & Pate and Trimble & Trim-ble, for appellant.

      CockrillS Armistead, for appellee.
   Smith, J.

Appellant filed a complaint in which lie alleged that U. R. Lindsey owned a truck, which, was driven by his son, Dale Lindsey, in the delivery of the different articles sold by the Magnolia Petroleum Company, hereinafter referred to as the company. The tank on the truck in which gasoline was contained and delivered was owned by the company. Dale Lindsey drove a load of gasoline belonging to the company from the town of Marshall to the town of Leslie, and, after mailing the delivery of the gasoline, he invited appellant and a number of other hoys to ride on the truck to a picnic which was on his return route to .the town of Marshall, and a short distance out of the town of Leslie. The invitation was accepted, and Dale Lindsey started on 'his return trip, and, in doing so, he drove his truck “at an unlawful rate of speed and in a manner so negligent, wanton, reckless and careless of the lives of all of his passengers that, out of the town of Leslie about two miles, as he approached a bridge across a stream, he failed to cross said bridge, but drove his truck off of said bridge, and the same fell some twelve or fifteen feet to the bottom of the stream, which was solid rock,” and severely injured appellant, who brought this suit to recover damages to compensate his injury.

Lindsey and his son and the company were all made defendants, but a demurrer filed by the company was sustained as to it, and the cause of action against the company was dismissed, and this appeal is from that judgment.

The question presented is whether a cause of action was stated against the company. The authorities on this subject are numerous and in direct conflict.

The case chiefly relied upon by appellant as supporting his contention that a cause of action was stated is that of Higbee Co. v. Jackson, 101 Ohio St. 175, 128 N. E. 61, 14 A. L. R. 131. This was an opinion by the Supreme Court of Ohio, and the first syllabus reads as follows: “Where an employee, to whom the owner has committed the operation of an auto truck in the owner’s business, permits an infant to ride on the truck, in violation of his instructions, and the infant is injured by the wanton and willful conduct of the employee, while in the •course and in the scope of his employment, the owner is responsible.”

There was a very vigorous dissenting opinion in this case 'by Justice Jones, who characterized the majority opinion as ‘ ‘ supported neither by sound legal reason nor by judicial authority in other 'States.” The dissenting Justice reviewed many oases, and, concerning the syllabus quoted, had this to say:

‘ ‘ That the rule of principal and agent is involved in this case is recognized by the syllabus, which establishes liability for ‘conduct of the employee while in the course and within the scope of his employment.’ However, the syllabus begs the entire question when it declares that here the wanton conduct of the employee was done within the «cope of his employment. If (the acts of the employee were ‘in the course and within the scope of his employment,’ then his principal would be liable, whether his acts constituted wanton or ‘mere’ negligence. This principle is elementary.”

The case of Zampella v. Fitzhenry, 97 N. J. L. 517, 117 Atl. 711, 24 A. L. R. 666, reviews the development of the doctrine respondeat superior from the time of William the Conqueror, and is a learned and interesting opinion. It was there held by the New Jersey Court of Errors and Appeals that “the driver of an automobile truck has no implied authority from his employer to invite children to ride on it, :and therefore the employer is not liable, in the absence of express authorization of the act, for injury to a child thrown from the truck when riding by the driver’s invitation.” •

There is an extended annotator’s note to the case last cited, collecting many cases on the subject, and the briefs of opposing counsel cite these and cither cases. We attempt no review of these cases, as we have announced the principles in former decisions of this court which are controlling here.

In the case of Railway Co. v. Bolling, 59 Ark. 395, 27 S. W. 492, the syllabus reads as follows:

“A child of tender years cannot recover from a railroad company for injuries received hy him while riding on a hand-car, caused hy the negligence of its employees who were propelling the oar, if the company’s rules forbade such employees to take any one on the hand-car except an employee, and there was no custom to permit persons to ride on the hand-car shown to have been known to or acquiesced in by the officials of the company.”

In the case of Little Rock Traction & Electric Co. v. Nelson, 66 Ark. 494, 52 S. W. 7, it was held that a boy ten years of age, riding upon a street car without paying fare, by invitation of a motorman in charge of the same, who had authority to receive and let off passengers, was not a trespasser. The motorman had no authority to admit passengers except upon the payment of fare, but he did have authority to ‘ ‘ receive and let off passengers, ’ ’ and the court said: “The invitation of the motorman (to' ride) is an act within the general scope of his employment, for which he is responsible to his master. If the boy accepts it innocently, he is no trespasser, and it is the duty of the company to extend to him the dili-' gence due to passengers of his age and discretion” (Citing oases).

The case of American Ry. Ex. Co. v. Mackley, 148 Ark. 227, 230 S. W. 598, cites many oases of this court dealing with the liability of the master for the unauthorized torts of the servant committed during the course of his employment, and it was there said that “the doctrine of all these cases is that the test of the master’s liability is, not whether a given act is done during the existence of the servant’s employment, but whether it was committed in the prosecution of the master’s business.”

In tlie note to § 1214, Berry on Automobiles (5th ed.), 901, many cases are cited which discuss the “scope-of employment” of a chauffeur or driver of another’s car. The author there says: ‘ ‘ The master is not liable for his servant’s acts if, at the time of the acts complained of, he has become ad hoc the servant of another, and engaged in the business of that other, and under his direction and control. Nor does it follow that a chauffeur is acting within the scope of his employment merely because he is operating his master’s automobile at the time of an accident. ’ ’

In the case of Keller v. White, 173 Ark. 885, 293 S. W. 1017, a recovery was sought against the Pierce Petroleum Corporation upon the ground that plaintiff’s intestate had been killed through the negligence of the corporation’s employee while driving an automobile owned by the corporation. It was there said:

“Our analysis of the testimony has convinced us, however, that the court should have given a peremptory instruction in favor of the Pierce Petroleum Corporation, because the undisputed evidence showed that the trip from Eudo-ra -to Lake Village was not taken in performance of White’s duties for said corporation or for its benefit, even if there were sufficient evidence to make the issue of his agency one for the jury. It is quite clear that White, Buchanan and H. T. Keller were on a trip to satisfy their own appetites rather than upon a mission for the benefit of the corporation in a business way. White was not acting within the scope of his authority as agent of the company or in the performance of his duties for it and for its benefit” (Citing cases).

Appellant cites and relies upon the case of Campbell Baking Co. v. Clark, 175 Ark. 889, 1 S. W. (2d.) 35, in which an agent, driving a truck over a route for the purpose of delivering and selling merchandise, in returning to the principal’s place of business towed an automobile to his own car, which, as it passed through a filling station at the intersection of two streets, skidded and struck the plaintiff’s oar and damaged it, and injured tlie plaintiff. The master was held liable, although the agent had exceeded his authority in towing the car, because he had not abandoned his principal’s business, that is, returning the truck to the principal’s place of business was an act within the scope of the servant’s employment, and -he negligently discharged his employment by towing the oar.

So here, if Lindsey, while driving appellant, had struck another car, his principal would have been liable for that act if it had been negligently done, because driving the truck on his return was within the scope of his employment; but permitting appellant to become the guest or the passenger of the driver was an unauthorized act which was beyond the scope of the servant’s employment. We said in the 'Campbell case that, although an agent may exceed his authority to the extent even of violating instructions, if, at the time the servant injures another, he is engaged in the business he was employed to perform, his employer is responsible for injuries resulting from his torts; but this is true because the servant is acting within the scope of his employment.

Had the owner of the automobile which was being towed in the Campbell case sued for the damages to it, we would have had the question here presented, but such was not the case. In such a case it would, no doubt, have been held that the driver 'of the truck had become ad hoc the servant of the owner of the automobile, as he had gone beyond the •scope of his employment in attaching the automobile to his truck; but that fact did not relieve the servant’s principal from liability for the damage done to the automobile of k third party while driving the truck in a negligent manner in pursuit of the servant’s employment.

Appellant also cites and relies upon the case of Bennett v. Bell, 176 Ark. 690, 3 S. W. (2d), 696, in which it was. said:

“The driver of an automobile or motor vehicle is bound to the exercise of ordinary care in the operation thereof for the safe transportation of his guests and other passengers and to avoid personal injury to them, and this duty extends to all such passengers, whether guests by sufferance, invited, or self-invited.”

That ease, however, was a suit against the owner of a car who> drove it himself. Here the demurrer which was sustained by the court does not affect the appellant’s right to sue the driver of the truck in which he was riding when injured.

We quote the syllabi of a few late cases.

“The owner of on automobile delivery truck held not liable for injuries to a child eight years old, who fell off while riding by the permission or at the invitation of the chauffeur, without the owner’s knowledge or consent, and without necessity therefor.’1’ Barker v. Dairymen’s Milk Products Co., 205 Ala. 470, 88 Sou. 588.

“Where ordinary truck driver invited or permitted a third person to ride on the truck, such third person assumed whatever risk there was in riding on the truck and whatever risk that might arise from his alighting and leaving the truck, and could not recover from the master by reason of such driver’s conduct in negligently starting the truck before he was off, such third person being a trespasser, even though a boy 14 years of age.” Hughes v. Murdoch Storage & Transfer Co., 269 Pa. 222, 112 Atl. 111.

“The driver of a delivery truck, employed to make deliveries of goods, acts outside of the scope of his employment where he, for companionship and for his own pleasure, and without the knowledge of his employer-, invites a friend to ride on the truck with him, and the employer is not liable for injuries to the guest of the driver, sustained from the negligence of the latter, even though the negligence be willful and wanton.” Morris v. Fruit Co., 32 Ga. App. 788, 124 S. E. 807.

‘ ‘ The driver of an automobile truck used by a mercantile 'Company in deliveries invited a lady acquaintance to ride on the step, and in the course of the ride she was injured. The driver had no authority to invite persons to ride on the truck. Held, that in such case he was not acting within the scope of his employment, and his master, the company, was not liable; for a servant, to be acting within the scope of his employment, must he engaged in doing some act under authority from his master.” McQueen v. People’s Store Co., 97 Wash. 387, 166 Pac. 626.

“Where truck driver had no authority to transport guests, he was not, in any part of his conduct towards a guest riding on the truck, acting within scope of his authority, and the guest could not recover for his wanton, willful and reckless misconduct in driving the truck. ’ ’ O’Leary v. Fash, 245 Mass. 123, 140 N. E. 282.

The syllabi in the cases of Tate v. Atlantic Ice & Coal Corporation, 25 Ga. App. 797, 104 S. E. 913, and Waller v. Southern Ice & Coal Co., 144 Ga. 695, 87 S. E. 888, are to the same effect.

We conclude therefore that the demurrer was properly sustained as to the company, for the reason that, under the allegations of the complaint, Lindsey was not acting within the scope of his employment in permitting appellant to ride on the truck.

The judgment will therefore be affirmed, and it is so ordered.


text:
    King v. Sternberg.
    Opinion delivered July 9, 1928.

      Dobbs & Young, for appellant.

      Clinton B. Berry, for appellee.
   Smith, J.

N. E. Clark* brought suit in the Johnson Chancery Court against 0. E. Bogers, and alleged that the defendant was indebted to him in the sum of $2,600, that appellant owned a stock of goods worth less than $12,000, and that he owed other creditors $16,000, and was insolvent.

On September 17, 1926, plaintiff and defendant, by their respective attorneys, appeared before the chancellor in vacation, who made an order in which it was recited that Luther King was appointed receiver to take charge of defendant’s stock of goods and fixtures, and the receiver was directed to make an inventory and to prepare and report to the court a list of defendant’s creditors.

On September '29,1926, the receiver reported that he had made the inventory, and the stock of goods invoiced $10,354.39, the fixtures $1,010, and the accounts approximated $4,000. The receiver further reported that “he has an offer to purchase said stock of goods and fixtures at 62% cents, on the dollar, in case the sale can be made at once, and that said offer is a fair price for said stock of goods and fixtures.” The report recited that D. A'. Blackburn was the proposed purchaser.

Upon the consideration of this report the chancellor ordered that the receiver make the sale of the stock of goods and fixtures at 62% per cent, of the invoice price, and to put the purchaser in possession thereof, and to report his action under the order.

On the day this order was made, the receiver and Blackburn, who were partners under the firm name and style of King & Company, took possession of the stock of goods and fixtures, and began to sell the goods for cash or on credit, as. they pleased.

On October 15, 1926, Rogers was adjudged a bankrupt by the United States District Court for the Western District of Arkansas, and Henry Sternberg was named as trustee, and on February 21, 1927, the trustee filed an intervention in the cause in which the receiver had been appointed, alleging the orders of the chancellor herein recited, and praying judgment against King for the invoice price of the stock of goods and fixtures. There was a prayer that King be required to file his final report, and that he pay into court the sum of $7,101.74, this being the sum at which the receiver had reported the sale could be made.

A demurrer was interposed to this intervention, which the court overruled, and King thereupon filed a response, which contained the following recitals: That he and Blackburn were in negotiation with Rogers for the purchase of the stock of merchandise, and it was discovered that, as Rogers had numerous creditors, compliance with the Bulk 'Sales Law would entail considerable delay, and it was then agreed that Clark, as a creditor, should brina1 a suit which would confer jurisdiction on the chancery court to appoint a receiver and order the sale of the goods and fixtures, but that King should act as receiver only for such length of time as was required to make an inventory, when he was to be removed as receiver and another person appointed as his successor.

The response further alleged that, in accordance with this understanding, suit was brought by Clark as a creditor, and, pursuant to the appointment of King as receiver, he made the inventory under the mistaken belief that his appointment was valid, and “with the assurance that, when he made the inventory, the chancellor would appoint another receiver.” In compliance with the agreement under which the suit was brought, King made the inventory, and, after doing- so, was advised that his appointment was void, and that he and his partner, Blackburn, would not obtain title to the goods under the order of sale made by the chancellor in vacation and Blackburn thereupon refused to pay any part of the purchase price. King-, at the instance of certain creditors, kept the store open and sold goods, keeping an account thereof. After the appointment of the trustee in bankruptcy, King offered to surrender to him the stock of goods and to account for the goods sold, but the trustee refused to accept this offer. It was alleged that the goods were not worth inore than forty per cent, of the wholesale price. King- denied that he was a purchaser of the goods, and prayed that he be held liable only as a trustee for the use of the general creditors.

On October 18,1926, King filed a report of his receivership, showing that the goods and fixtures on hand amounted to $6,391.96, and that he had proceeds of sales amounting to $3,107.77. The receiver reported that he expended in taking care of the goods and in making the inventory the-sum of $232.50.

The trustee in bankruptcy filed exceptions to the report of the receiver, and alleged that King was indebted to the estate of tire bankrupt in the sum of $7,102.74, with interest thereon from September 29, the date on which the chancellor ordered the goods turned over to the purchaser. The trustee in bankruptcy objected also to the allowance of any compensation to King for his own services, and prayed the court to allow a fee to compensate the trustee’s attorney for services in this litigation.

The court found, on the final submission, that King, as receiver, was himself the purchaser of the stock of goods and the fixtures, and had been in continuous possession of the property, selling such of it as he could and adding to the stock ¡by additional purchases, and that he should account for the purchase price, to-wit, $7,102.74. The court further found that King should be allowed $232.50, and that he should be charged interest from December 22, 1926, the date of the demand by the trustee in bankruptcy for the proceeds of the sale. The court refused to allow a fee to the attorney for the trustee in bankruptcy.

Prom this decree King has appealed, and the trustee in bankruptcy has prayed a cross-appeal.

For the reversal of this decree appellant insists: (1) that the proceeding in the chancery court was wholly void, and he should be held liable only as trustee, and not as a purchaser; (2) if the proceedings were not wholly void, there was no sale, and he should not be held as a purchaser; (3) that he acted in good faith at all times, and held the goods as trustee for Rogers until the appointment of the trustee in bankruptcy, and that the offer to purchase which was submitted to the court was upon condition that the purchaser acquire a good title to the property sold, and that, as he did not acquire such title,, he should be permitted to return the unsold goods and to account for those sold at their invoice, or the price at which he had sold them.

It may be said that appellant offered to introduce testimony on the final hearing of this cause to the effect that he acted in entire good faith in the matter, and that the chancellor was fully apprised of all the facts in the case before any order of any kind was made, and that the goods bad deteriorated and depreciated in value; bnt the court refused to consider any of this testimony.

We think it unnecessary to consider any of the arguments advanced by counsel for appellant in support of the theories above stated, and it may be conceded that the effect of the excluded testimony was that appellant had acted in good faith throughout the matter, and that the goods now on hand and unsold are not worth their invoice price.

If it be conceded that the orders of the chancellor made in vacation were void and that appellant’s appointment as receiver was unauthorized, appellant is still liable. A receiver improperly appointed may be required to account for assets which came into his hands by virtue of his appointment, and such is the effect of the decree of the court from which this appeal comes.

The trustee in bankruptcy did not attack the sale to appellant. He accepted as correct the inventory made by appellant himself and appellant’s own estimate and report as to value, and asked only that appellant be required to account to him for this value.

There was a sale by appellant as receiver to a copart-nership of which he was a member. This sale Was made without notice of any kind to the general creditors, and without advertisement, and upon representations to the chancellor that it could not be made at all unless made at once. There was no condition in the receiver’s report or the chancellor’s order that the sale should be dependent upon its validity. It was an absolute sale, although unauthorized, and we see no inequity in holding appellant to his bargain and in requiring him to settle in accordance with its terms.

The goods were converted to appellant’s own use, and he has sold a considerable portion of them, and his liability for their value cannot be affected (by his good faith. The court did not err in refusing to consider testimony tending to show a depreciation in the value of the goods, as appellant was liable for the value of the goods at the time of their conversion, and this liability cannot be reduced by tbeir subsequent depreciation. Appellant fixed the value of the goods at 62% per cent, of their invoice price, and reported a purchaser at that price, and there can be no injustice in requiring him to account for them at that value.

Certain questions are raised upon the cross-appeal which must be considered. One of these is. the allowance to appellant for his services in making the inventory and appraisement. We think this allowance should not have been made. The order of the 'chancellor appointing appellant receiver provided that he should be appointed receiver “with the express stipulation, however, that there is to be no costs incident to such receivership,” and that the receiver should serve as such “without fee or commission to himself.” It may be further said that the services of appellant in making the inventory appear to have been rendered, not for the benefit of the general creditors, but to enable him to determine what price he could afford to pay.

The court charged interest on the value of the goods from the date of the demand of the trustee in bankruptcy for the purchase money, and on the cross-appeal it is insisted that the interest should have been charged from the date appellant took possession of the goods and fixtures; and we think this contention is also correct. The rule is that one who converts another’s property is liable for its value from the date of the conversion. Hudson v. Burton, 158 Ark. 619, 250 S. W. 898; Lipscomb v. Delong, 158 Ark. 24, 249 S. W. 14; Newburger Cotton Co. v. Stevens, 167 Ark. 262, 267 S. W. 777, 140 A. L. R. 1279.

It is further insisted on the cross-appeal that the court should have made an allowance of a fee to the attorney for the trustee in bankruptcy, and that it was error to refuse to do so. We think, however, that the court was correct in this ruling', as this is a matter which will no doubt be properly taken care of when the trustee in bankruptcy makes his final report.

The decree is therefore affirmed on the direct appeal and reversed on the cross-appeal in the respects indicated.


author: Humphreys, J.

text:
    Harper v. Betts.
    Opinion delivered July 9, 1928.

      Ivie G. Spencer and Cooley, Adams & Fuhr, for appellant.

      Dudley & Dudley, for appellee.
   Humphreys, J.

The only question involved on this appeal is whether an administrator and the surety on his bond are liable for funds of the estate deposited -by the administrator in his representative capacity for safekeeping, in a bank which afterwards failed, but of good repute and apparently solvent when the deposit was made, until he could obtain an order of court with reference to the disposition thereof.

This suit originated in the probate court of Craig-head County, by- petition of appellee for an accounting, settlement and discharge of T. J. Harper, the administrator of the estate of Roy Betts, deceased. Appellee was the only heir of her son, Roy Betts, who died April 22, 1926. T. J. Harper was a friend of the family, and distantly related to appellee by marriage. During the continued and last illness of Roy Betts, Harper paid the premiums on a life insurance policy, which he carried in the Metropolitan Life Insurance Company, for over a year, amounting to a total of $16.50. On account of the friendship, relationship and the illiteracy and bodily infirmities of appellee, Harper administered upon Roy Betts’ estate when he died. The insurance policy constituted the only asset of the estate. Harper filed with his application for letters of administration a bond in the penal sum of $1,000, signed by himself and the United States Fidelity and Guaranty Company as surety. Immediately after obtaining letters of administration he collected $564.75 upon the policy from the life insurance company, and, after deducting $16.50 which he had advanced as premiums and $34.50 as expenses of the administration, he deposited the balance, amounting to $508.95, in the First National Bank of Jonesboro, in his representative capacity. At the time the hank was a going concern, in which he was carrying his individual account, and was apparently solvent. In eighteen days after he made the deposit, said hank failed, and was closed by the Banking Department, and is still in the process of liquidation through a receiver. Since the failure a 20 per cent, dividend has been declared, which was paid appellee, by and with the consent of the administrator. The United States Fidelity and Guaranty Company was made a party to the proceeding in the probate court.

The administrator and his surety • interposed the defense that the insurance money was deposited in said bank, in good faith, by the administrator for safekeeping until disposition could he made of same under an order of the court, and that, within three weeks after making the deposit, the bank failed and was taken over by the Banking Department for liquidation. The administrator’s bond was executed in accordance with, the requirements of § 23 of Crawford & Moses’ Digest. Among the undertakings and guaranties in the bond, the administrator agreed and the surety guaranteed that said administrator would make just and true accounts, and would make due and proper settlements thereof, from time to time, according to law, or the lawful order, sentence or decree of any court having competent jurisdiction qf the subject-matter.

Upon a trial of the cause in the probate court, and circuit court on appeal, judgments were rendered against appellants for the amount collected on the insurance policy, less the amount advanced by Harper for premiums on the policy and the necessary expenses of the administration.

An appeal has been duly prosecuted to this court from the judgment of the circuit court.

The facts are undisputed, and are substantially as stated above. The trial court rendered judgment upon the theory that an administrator is responsible for all moneys received by him in such capacity, absolutely and in all events. The effect of the decision of the trial court was to make administrators qf estates and their sureties insurers or absolute guarantors of any and all properties and moneys which may come into their hands in their representative capacities.

The undertaking of administrators and their bondsmen is to faithfully administer the estate and cause to be made just and true accounts and to make due and proper settlements thereof, from time to time, according to law, or the lawful order, sentence or decree of any court having jurisdiction of the parties and subject-matter. There is no statute in this State which requires administrators to deposit funds of an estate for safekeeping until disposition can be made thereof under orders of court, and no statute prohibiting them from doing so.' It would certainly be an imprudent and hazardous undertaking fon administrators to keep upon their persons or in private hiding places funds ■ belonging to an estate, and unjust and inequitable to require them to deposit the funds belonging to an estate in banks at their own or their bondsmen’s peril. Such a rule would impose harsh and unreasonable responsibilities upon administrators, and prevent prudent business men from assuming such responsibilities. The law has worked out a rule applicable to situations of this kind which is equitable and just and aptly expressed in 11 Am. & Eng. Ency. Law, pp. 947-949. It is as follows, omitting unimportant parts:

“As a general rule, there is no absolute requirement of law that funds of the estate shall be deposited in a bank or other repository where money is usually placed for safekeeping, but the duty of the personal representative in such matters is governed by the rule that he must exercise the care and prudence that ordinarily prudent men exercise in regard to their own affairs; and this is the measure of his responsibility if he fails to deposit the funds of the estate in a safe place. * * * If any executor or an administrator, in his representative capacity, deposits funds of the estate in a bank in good standing, and nothing occurs to indicate that the affairs of the bank are in such condition as would lead a reasonably prudent man to withdraw the funds, he is not liable for the loss thereof, though resulting from the subsequent failure of the bank. * * * The consent of-the beneficiaries to the deposit will relieve the personal representative from liability for loss.”

The same rule is expressed as follows in 11 R. C. L., 158:

“It is an accepted principle in most jurisdictions that an executor or administrator who deposits the money of the estate, in good faith, in a solvent bank of good repute, to trust account and not to his own account or credit, is not liable for the loss of' such money through the subsequent insolvency or failure of the bank.”

The same rule is expressed in the following language in 24 C. J., 50:

“It is proper for the executor or administrator, for the purpose o.f safely keeping the funds of the estate during administration, to deposit the same in a hank, and indeed, under some statutes, the representative is required, or the court is empowered to order him, to do so. If the.funds are so deposited and due care is used in selecting the depository, the representative is not necessarily responsible for a loss resulting from the subsequent failure of the bank, the test being whether he has exercised such care as men of common prudence ordinarily exercise in’their own affairs.”

The rule thus expressed is sustained by a unanimity of both Federal and State authorities. We think the facts in the instant case bring it within, the rule thus announced. The undertaking by appellants was to administer the estate in accordance with the law, and the law does not exact unreasonable things. The undisputed facts show that Harper exercised such care as a man of common prudence ordinarily exercises in his own affairs in making a deposit of the fund in his official capacity for safekeeping in the First National Bank of Jonesboro. He met the test required by the rule, and he and his bondsmen should have been acquitted of liability on the bond. He and his bondsmen sufficiently accounted for the fund by showing that it was deposited for safekeeping, immediately upon its receipt, in a bank which was a going concern and apparently solvent, and so regarded in the community, and which failed and was closed by the Banking Department within a short time after the deposit was made.

On account of the error indicated the judgment is reversed, and the cause is remanded with instructions for further proceedings not inconsistent with this opinion.

Smith and Kirby, JJ., dissent.


author: Kirby, J.

text:
    School Districts Nos. 41 et al. v. Pope County Board of Education.
    Opinion delivered July 9, 1928.

      Hays, Priddy & Bor ex and Robert Bailey, for appellant.

      Ward & Caudle, for appellee.
   Kirby, J.

This appeal is from a judgment of affirmance by the circuit court of the action of the county board of education of Pope 'County, consolidating certain school districts in said county, the three causes being instituted separately and consolidated for a hearing .by the hoard of education. The proceedings were instituted under the authority of act 144 of the Acts of 1927, and no question is raised challenging the regularity of the procedure.

The board of education dissolved the districts upon proof of the record of attendance, made before the act was passed, during the school year ending June 30, 1927. Appellants insist that the board was without authority, under the provisions of act 144 of 1927, enacted without the emergency clause, to dissolve the districts upon proof of the record of the average daily attendance below the requirements of said act, made before it became effective, and las shown by the record of attendance for the school year ending June 30, 1927, and this contention must be sustained.

Section 1 of said act provides: “The county board of education of any county shall have the discretionary power to dissolve any school district whose length of school term shall not be one hundred twenty days in any school year, or whose average daily attendance does not exceed fifteen pupils, and attach the territory so dissolved to adjacent school district or districts * *

The act was approved on the 16th day of March, 1927, but contained no emergency clause, and did not go into effect until 90 days after the adjournment of the Legislature on March 12, 1927, or until June 12, 1927. Arkansas Tax Commission v. Moore, 103 Ark. 48, 145 S. W. 199; St. Louis, Iron Mountain & Sou. Railway Co. v. Roddy, 110 Ark. 161, 161 S. W. 156.

“A statute should have a prospective operation only, unless its terms show clearly a legislative intention that it should operate retrospectively.” Fayetteville B. & L. Assn. v. Bowlin, 63 Ark. 576, 39 S. W. 1047; Black v. School District, 106 Ark. 572, 173 S. W. 1104. Certainly it was not the intention of the Legislature to give this law a retroactive effect, there- being no expression of an intention therein indicating that its operation should be other than prospective, and it accordingly furnished no authority for dissolution of the districts because of the too small daily attendance of pupils before the law became effective, and the court erred in holding otherwise.

Appellee insists that the appeal was not properly taken from the decision or order of the board of education abolishing the districts, to the circuit court, because no affidavit (for appeal, in accordance with the terms of act 144 of 1927, providing therefor, is shown in the transcript. This question was not raised in the circuit court, however, by objection or any motion to dismiss' the appeal, and must ibe held to have been waived by the appearance of appellee therein and the trial of the canse. Wulff v. Davis, 108 Ark. 291, 157 S. W. 384; Ark. Brick & Tile Co. v. Crabtree, 172 Ark. 752, 290 S. W. 361.

The judgment is accordingly reversed, and the canse remanded to the circuit court, with directions to reverse the order of the county board of education abolishing and consolidating the said districts, and for any further necessary procedure according to law and not inconsistent with this opinion.


text:
    Vitagraph, Incorporated, v. Watson.
    Opinion delivered July 9, 1928.

      I. J. Friedmam, and Cochran & Arnett, for appellant.

      George A. Hall, for appellee.
   Humphreys, J.

Appellant brought suit against appellees in the circuit court of Logan County, Northern District, to recover $1,275 on account of an alleged failure and refusal to accept and exhibit in the Strand Theater at Paris, Arkansas, certain photoplays or copyrighted motion picture .• productions, which • appellees agreed in writing to rent and exhibit at certain prices fixed in the contract for each photoplay or motion picture production.

Appellees interposed the defense that it purchased the exclusive right or license to exhibit the photoplays or copyrighted motion picture productions from ¡appellant, and that, after accepting, exhibiting and paying for some olf them, appellant ¡breached or violated the contract by leasing to N. K. McGfuggin of Paris, Arkansas, owner of the Joie Theater, the right and authority to exhibit the same photoplays or copyrighted motion picture productions in the town of Paris, and by way of cross-complaint ¡alleged that they were damaged in the sum of $1,000. The allegations of the cross-complaint were denied by appellant.

The' cause was submitted on the pleadings, testimony introduced by the respective parties and instructions of the court, which resulted in a verdict in favor of appellees in the original suit and against them in the cross-complaint. A consequent judgment w¡as rendered that appellants take nothing on their suit, from which an appeal has been duly prosecuted to this court.

Before submitting the issues of the alleged breach of the contract by the respective parties to the jury for determination, the court found and adjudged that the “direction to the salesmen” which ¡appeared at the foot of the contract was a part of the contract, and construed it to mean a rental of the exclusive right by appellant to appellees to exhibit said photoplays or copyrighted motion picture productions. Appellant objected, and excepted to the ruling of the court in this respect, and contends for la reversal of the judgment on account of such ruling. The directions to the salesmen appearing at the foot of the contract are as follows:

“Directions to salesmen: While you have every right to trade among prospective customers to obtain the best offer possible for your products, after you have selected a particular exhibitor whose offer you believe to be the best obtainable and have taken a written application from such exhibitor, forward the application to the office of yonr exchange, and make no (further effort to sell the same service to any other exhibitor until the application has been duly rejected, accepted or withdrawn, in accordance with its terms.”

The contract was la printed contract prepared by appellant, and must be construed most strongly against it. We think it a part of the contract, and that the purport and effect thereof was to rent or lease the exclusive right to the particular exhibitor selected to exhibit the photoplay or copyrighted motion picture productions. Its only purpose in being printed iat the foot of the contract was to convey the impression to prospective customers that the particular one selected to exhibit the picture should have the exclusive right to do so. If such was not its purpose, the directions to salesmen could have been given privately, either in person or by letter.

The issue of whether the contract was breached and by whom was submitted to the jury under correct instructions, and, as there was ia conflict in the evidence on the issue, appellants are bound by the verdict of the jury.

No error appearing, the judgment is affirmed.


text:
    Milner v. Standard Veneer Company.
    Opinion delivered July 9, 1928.

      M. P. Huddleston, for appellant.

      Jeff Bratton, for appellee.'
   Humphreys, J.

This is an appeal from an instructed verdict and consequent judgment dismissing appellant’s complaint for damages on account of an injury received while off-bearing veneering from a lathe, through the alleged negligence of appellee, his employer, in failing to exercise care to furnish appellant a safe place in which, and s'afe machinery with which, to work; and failing to warn him in such way that he might comprehend the 'latent dangers incident to the discharge of his duties.

The verdict was instructed upon the theory that the undisputed testimbny reflected that appellee was not negligent in either respect. The only question therefore presented by the appeal is whether there is any substantial testimony in the record tending to prove' the alleged grounds of negligence.

Appellant could neither read nor write, but was otherwise intelligent. He was seventeen years old at the time of the injury, and had been working for a year and six weeks in the capacity of off-bearing veneering from a lathe operated by cogs attached to an iron shaft with set-screws which passed through the shaft so as to hold the cogs in place. He had only worked steadily at this particular machine for about six weeks, but had worked at ene of similar make for a year in Jonesboro. The machine at which he was working when injured was known as the Coe lathe machine. The Coe lathe machine which was in use by appellee at its mill was .standard mlachinery, without defects, and in use iby many veneering mills. It had an. iron hood entirely covering the cogs and set-screws, which were attached to the shaft, in every direction and downward one-half way of the shaft, or to the center thereof, so as to prevent contact with the cogs or set-screws from above or on the sides. The only way one conld come in contact with or be injured by the cogs and set-screws was from underneath, or below the shaft. According to the testimony of witnesses experienced in the use of the machinery, the cogs and set-screws were sufficiently guarded :by the iron hood to prevent any injury which could be reasonably anticipated by workmen engaged in off-bearing veneering from or in operating the lathe. The covered cogs and set-screws were eighteen inches from where appellant stood to take the veneering as it came from the lathe and remove same. The machinery was in operation, and, while waiting if or the veneering to come out, appellant stepped back and leaned against the machinery in some way, so that his overalls were caught underneath the shaft and hood by the cogs and setscrews, pulling him backward and injuring his hip. The workman operating the machine ran and cut the overalls off the boy, thereby saving his life. Notices were posted all around in the mill not to lean against the machinery, but it was not shown that any one read the notice to appellant. Appellant and the boy working across the table in front of him testified that the foreman had never told them not to lean against the machinery and had not informed him that the cogs and setscrews were under the hood, and to keep away from them. Appellant also testified that he did not know that the cogs and set-screws were under the hood. The foreman testified that he had never warned appellant of the danger on account of the cogs and set-screws, but claimed to have warned all of the employees generally not to lean against the machinery. This was denied by appellant.

The law imposes a duty upon masters to exercise reasonable care and diligence to provide their employees, adults and minors, with a safe place in which to work, and also to warn inexperienced minors, although intelligent, of dangers incident to the operation of machinery with which they are to work, which are known by the master, or which may reasonably be anticipated by him. A majority of the court is of opinion that appellee exercised ordinary care land diligence in furnishing appellant a safe place in which, and safe machinery with which, to work. The machinery was of standard make, and the cogs and set-screws were covered- in every direction with an iron hood which came down to the center of the shaft. This furnished ample protection to employees against any dangers which might be reasonably anticipated. A majority of the court is also of opinion that, on account of the intelligence and experience of the appellant, no duty rested upon appellee to warn him against danger pn account of the cogs and set-screws which it could not anticipate itself, on account of having sufficiently covered up the danger.

Mr. Justice Mehaeey and the writer are of opinion that a latent or hidden danger existed in the operation of the machinery, which appellee should have anticipated and which appellant should have been made to comprehend by explanation and' wlarning on account of his minority, his ignorance of the existence of the cogs and set-screws, and his limited experience.

No error appearing, the judgment is affirmed.


text:
    Oates v. Haynie.
    Opinion delivered July 9, 1928.

      W. R. Morrow and H. B. Stubblefield, for appellant.

      Carmichael & Hendricks and Taylor Roberts, for ap-pellee.
   Humphreys, J.

Appellant, a taxpayer of Pulaski County, brought suit for himself and. other taxpayers against appellee, sheriff and collector of said county, to require him to pay over to the county treasurer, on the first and fifteenth days of each month, and within two days thereafter, all funds in his hands belonging to said county, or to the public road funds, or public school fund, or poll-tax fund, or any moneys collected by him and belonging to said county or any district in said county, in accordance with § 6 of act No. 163 of the Acts of the General Assembly for the State of Arkansas, Acts 1927, p. 580, alleging that said collector had failed and refused to pay over to the county treasurer the public funds collected by him, as provided in said act.

Appellee filed an answer, denying that he had failed to pay over to the county treasurer on the days required all funds in his hands belonging to said county or to the other various public funds, but that his failure to do so was on account of it being a physical impossibility for him to make a complete .settlement with the county treasurer and pay over to him all the funds to the credit of the various political subdivisions every two weeks and within two days thereafter; and alleging' that the statute, so far as applicable to him, is arbitrary, unreasonable, unworkable and impossible to perform; also alleging that the proper credit of the funds received from the tax collectors involved intricate questions of accounting in bookkeeping, which make it impossible to comply literally with the statute at the times fixed; that the additional expense to the county required to ascertain the exact amount due each political subdivision would exceed by far the amount of interest that would be earned which the county would derive from the amounts if paid in promptly and at fixed times.

A demurrer was filed by appellant to the answer of appellee, which was overruled by the court, whereupon appellant refused to amend, his complaint, and elected to stand on his demurrer. The court then dismissed appellant’s complaint for the want of equity, from which is this appeal.

It will be observed that there is nothing in the pleadings alleging the exact manner in which settlements and payments had been miade. The clear inference is that settlements and payments had been made, but not in literal compliance with the requirements of the statute. Appellant construes the statute to mean that the settlements must be complete, reflecting the exact amount due each political subdivision, and that payments must be made of the full amount due each political subdivision at the times stated, and bases his contention for a reversal of the judgment on such construction of the statute. Appel-lee argues that, if appellant’s construction of the statute is correct, then the statute, as applicable to him, is arbitrary, unreasonable, unworkable, and impossible to perform.

We do not agree with the construction placed npon the statute hy appellant. The purpose of the statute was to require the collectors of the various counties in the State to make early settlement with the respective county treasurers, so the treasurers, in turn, could deposit the various taxes in the county’s depositories, in order that interest might be obtained on the various county funds. Section 6 of the act does not require that complete settlements be made before the money shall be paid over by the collector to the treasurer. It requires that all funds due the respective political subdivisions shall be paid over by the collector, at stated times, to the treasurer. If - the statute required that full, complete and final settlement should ¡be made between the collector and treasurer as often as the statute requires, it would perhaps, be unworkable in counties where very large amounts were being continuously collected for each political subdivision. It would be entirely practical for the collector to approximately estimate the amount he collected and had in his hands for each political subdivision twice a month, or once a month when he was actually engaged in a canvass over the county in the collection of the funds. The statute does not mean that the amounts due each political subdivision shall be paid until there is a complete settlement between the collector and treasurer showing the exact amount due each political subdivision. As stated above, the statute does not refer to settlements at all. Pending these settlements, it would be entirely feasible and practicable for the collector to pay over approximately the amount due each, based upon estimates. The section of the statute involved reads as follows:

“The county and probate clerk, circuit clerk, sheriff and collector of each county in the State of Arkansas are hereby required to -pay over to the county treasurer of each county, on the first and fifteenth days of each’ month and within two days thereafter, all funds in each of their hands belonging to said county, or to the public road fund, or public school fund, or poll-tax fund, or any moneys collected by them and belonging to said county or any district in said county, that by law is required to he paid in the county treasury, whether taxes, fines or any moneys that are collected for any purpose by law and belonging to said county; provided, that the sheriff or collector of said county, when on his annual canvass over-said county for the purpose of collecting taxes, may pay into the treasury of his county only on the first day of each month, or within two days thereafter, all county, school, road tax, or other funds belonging to said county or any district thereof, until said canvass shall have been completed. ’ ’

Since the pleadings do not reflect any intentional or willful failure or neglect to pay over the funds as far as practicable, at the times specified in the statute, we think it was entirely proper for the court to dismiss the complaint for the want of equity. We think it fairly infer-able from the pleadings that the collector has been paying funds over as rapidly as practicable under all the circumstances, ' and, if he has been doing so, there is no just complaint, and could be none on the -part of the taxpayers.

No error appearing, the decree is affirmed.


text:
    Moore v. Rogers Wholesale Grocery Company.
    Opinion delivered July 9, 1928.

      J. W. Grabiel and JoJm Mayes, for appellant.

      Blcmsett & Combs, John W. Nance and Daily & Woods, for appellees.
   Kirby, J.

Appellees brought separate actions against appellant, M. W. Moore, J. L. Moore and the Fayetteville Grocery Company, alleging that the Moores were engaged in the retail grocery business in Fayette-ville, under the name and style of Fayetteville Grocery Company, but that appellant, M. W. Moore, was the sole' owner of said business. The suits were based upon open accounts for goods and merchandise sold and delivered to the Fayetteville Grocery Company, the account of the Rogers Company being $1,978.27, that of the Ozark Company $1,019.44, that of the Reynolds-Davis -Company $310.64, and that of W. J. Echols & Company $744.63. On a consolidated trial of said cases the jury found for the respective appellees in the following sums: $842.70; $434.27; $132.32, and $317.19. Thereupon the appellees filed a motion for judgment in the amounts claimed, notwithstanding the verdict, which the court sustained, and entered judgment for each of the appellees in the respective sums hereinbefore stated, constituting the amount of their verified, itemized statements of account.

Appellant filed separate identical answers to each complaint as follows: “This answering defendant denies that the plaintiff, at any time or on any occasion, sold and delivered to Mm any goods, wares or merchandise for which it has not been paid; denies that he is indebted to the plaintiff npon the account stated in the sum of $1,978.27 (in the case of Rogers Company) or for any other sum; denies that this answering defendant is indebted to said plaintiffs in any amount for any cause whatever, either for principal or for interest, and therefore prays that the plaintiff may take no' judgment against him,” etc.

As heretofore stated, all the cases were consolidated for trial, over appellant’s objection. His defense to each of the actions was the same, that he was not interested in the Fayetteville Grocery Company, was not the owner thereof, and could not be held for its accounts.

It is first contended for a reversal of the case that the court erred in consolidating these cases for purposes of trial. There was no error in this regard. This procedure was authorized by § 1081, 0. & M. Digest, and by many decisions of this court cited in the Digest under the above section. The court specifically instructed the jury that each appellee-would have to make out its own case, and, in effect, told them that they could not find for one appellee merely because one or more of the other appellees might, in their judgment, be entitled to a verdict. If appellant had desired any additional instructions more specifically telling the jury that it could not consider the testimony of one appellee in reacMng a verdict in the other cases, he should have done so.

It is next insisted that the court erred in giving certain instructions, and. in refusing certain others requested by appellant, for the reason that there is no allegation in- the several complaints that appellant held himself out to be, or represented himself to be, -the owner of the Fayetteville Grocery Company, or that he was estopped by reason of any statement or act on his part from denying his ownership. We think appellant is wrong in this contention. These suits were brought against him as the owner, of this store. Under such allegation, they would be permitted to prove any fact tending to show ownership on his denial thereof. He did deny ownership, and they thereupon were permitted to prove a lot of facts and circumstances tending to show that he held himself out as such owner. The question which was submitted to the jury was whether appellant was the owner otf this store, or had so conducted himself or held himself out to others as to lead them to believe he was the owner, and, upon such belief, they extended credit to them. In Herman Kahn v. Bowden, 80 Ark. 23, on page 30, 96 S. W. 126, Ann. Cas. 132, it is said:

“A person who holds himself out ¡as a partner of a firm is estopped to deny such representation not only as to those to whom the representation was directly made, but as to all others who had knowledge of such holding out and, in reliance- thereon, sold goods to the firm, provided they exercised due diligence in ascertaining the facts. The cases go even further, and hold tha't, if one have knowledge that he is being held out to the world as a partner and fails to contradict the report, he may become liable to those crediting the firm on that account. Campbell v. Hastings, 29 Ark. 513; Fletcher v. Pullen, 70 Md. 205, 16 A. 887, 14 Am. St. Rep. 355. It follows therefore, for much stronger reasons, that, if the party himself puts out the report that he is a partner, he will be liable to all those selling goods to the firm on the faith and credit of such report.”

It was not necessary therefore for appellees to allege in their complaints that appellant held himself out or represented himself to be the owner of the store.

Complaint is also made of error in the admission of testimony with reference to the respective accounts of Reynolds-Davis Co. and the Echols Company. Appellant did not question the correctness of the accounts filed with the complaints. They were itemized and sworn to. He therefore could not have been prejudiced by this testimony.

Complaint is also made of certain other witnesses who testified regarding their knowledge and information concerning appellant’s ownership of' this store. This testimony was competent, and properly admitted.

It is finally insisted that the conrt erred in granting the motion of appellees for judgment notwithstanding the verdict. In this respect we think appellant is correct, and in this regard this case is rnled by the recent case of Fulbright v. Phipps, 176 Ark. 356, 3 S. W. (2d.) 49.

If therefore appellees will enter a remittitur within fifteen days down to the amount found due them respectively by the jury, the case will be affirmed, otherwise it is reversed, and remanded for a new trial.


author: Kjrry, J.,

text:
    Lasater v. Western Clay Drainage District.
    Opinion delivered July 9, 1928.

      Oliver & Oliver, for appellant.

      D. Hopson and Charles D. Frierson, for appellee.
   Kjrry, J.,

(after stating the facts). It is insisted by appellants that the clause in the contract providing for the payment of $10 per. day for all the time required for the completion of the contract after the expiration of the three years allowed therefor is a provision for a penalty, and not for liquidated or stipulated damages, and this contention must be sustained. In determining this question, the intention of the parties to the contract is controlling. In 17 C. J. 935, § 34, it is said: ‘ ‘ As a broad general rule, the intention of the parties will control as to whether a provision in a contract is for a penalty or for liquidated damages.” The primary rule in the construction of contracts requires the court to ascertain and give effect, where possible, to the mutual intention of the parties. 13 C. J. 521, § 484; Roach v. St. Francis Levee Dist., 168 Ark. 364, 269 S. W. 986; English v. Shelby, 116 Ark. 212, 172 S. W. 817; Life Assn. v. Minehart, 72 Ark. 631, 83 S. W. 323.

Here, in the first section of the contract, it is required that the work shall be done “under penalty expressed in a bond bearing even date with these presents and hereto attached.” The bond itself provides it is given “in the penal sum of $25,000,” and is conditioned that the contractor shall carry out the contract and perform all covenants contained therein, and “shall indemnify and save harmless the said Western. Clay Drainage District from and against all damages which it may sustain by reason of liens for labor or materials, etc.; * * * and if the said Clay County Dredge Company shall pay to the said Western Clay Drainage District all sums of money, damages or cost and expenses which it may be compelled to pay or which it may sustain by reason of the failure of the said dredge company to in every particular comply with and carry out each and every covenant and agreement contained in said contract, * * * and if the said Clay County Dredge Company shall pay all laborers, mechanics, materialmen, and persons who may have supplied provisions, goods or material of any kind, all just debts due said persons, or to any person to whom any part of such work may have been let by the said Clay County Dredge Company, then this obligation shall be null and void, otherwise to remain in full force and effect.” The bond provides for the payment of all damages the district could suffer or sustain from a breach of the contract by Brown, and for failure in every particular to carry out each and every covenant and agreement;

From a proper construction otf the contract and bond, which must be read together, it appears that provision is made and the bond answerable for all actual compensatory damages that could result to the drainage district (from the failure of the contractor to carry out his contract or complete the work in accordance with its terms. The directors themselves, on June 3, 1918, by resolution recited that the contract and bond provided that the contractor shall pay.“a penalty of $10 per day” from the date set for the completion otf the work until such work is completed and accepted by the engineer. The resolution required the contractor and his bondsmen to be notified by letter from the secretary “that the penalty provided for will be exacted,” and that, if the contractor can show any cause “why said penalty should not be exacted,” the ¡board would hear Mm, etc. On October 9, 1918, another resolution was passed, reciting’ that the property holders were being damaged by delay, and, unless the contractor proceeded, the contract would be relet, and “the district would hold him and his bondsmen for all damages, * * * and ask the penalties therein provided for in your contract, and any action taken by the board shall not be construed as relieving you and your bondsmen of the penalties provided for in your contract for the completion olf the work.” On May '29, 1917, a resolution was passed by the board, reciting that two-thirds of the time for the completion of the work had expired and it was not one-half done, and requiring’ that Brown be notified “that, if said work is not completed within the time provided in the contract, the penalty therein provided, of $10 per day, will be exacted.”

It thus appears that the appellees, by the nomination of this $10 per day provision in the contract as a penalty, and by their construction of the contract and bond expressed in formal resolutions of the board, designating it as a penalty, have given the contract a practical construction, which is entitled to great weight in determining its proper construction. Then, too, it may be inferred that the contract and bond were prepared by appellee’s engineer and approved by its directors, and any doubt about its meaning is to be resolved against the party preparing it. 13 C. J. 546, § 517; Gauss v. Orr, 46 Ark. 129; Kahn v. Metz, 88 Ark. 363, 114 S. W. 911; Edgar Lumber Co. v. Cornie Stave Co., 95 Ark. 449, 130 S. W. 452; Haynes v. Masonic Benefit Co., 98 Ark. 421, 130 S. W. 452; Koepple v. Nat. Wagon Stock Co., 104 Ark. 466, 149 S. W. 75; Humphreys v. Ft. Smith, etc. Co., 71 Ark. 152, 71 S. W. 662; Watkins Med. Co. v. Williams, 124 Ark. 539, 187 S. W. 653; Arlington Hotel Co. v. Rector, 124 Ark. 90, 186 S. W. 622; Hastings Ind. Co. v. Copeland, 114 Ark. 415, 169 S. W. 1185; Clark v. Watkins Med. Co., 115 Ark. 166, 171 S. W. 136; Ford v. Fix, 112 Ark. 1, 164 S. W. 726.

The court is of opinion that, when the contract is tested by these rules, the provision therein for the payment of the $10 per day for each day’s delay in the completion of the work after the date fixed therefor was intended as a penalty, in effect a security for its performance, and must be treated as such, and not as a provision ifor liquidated damages, as erroneously held by the trial court. 'Since there was no proof of actual damages sustained by the district because of the delay in the completion of the improvement after the term allowed therefor, no deduction should have been made from the amount shown and conceded to be due the contractor for the work done in its construction. It was conceded that the appellants were entitled to recover for the right-of-way cleared and afterwards abandoned, as found by the special master, the sum of $350, with 6 per cent, interest from January 1,1917, and that the correct amount of the retained percentage was $12,244.62, which appellants were entitled to recover, with 6 per cent, interest from January 1, 1924, unless the appellee was entitled to recover an amount on its cross-complaint, to be deducted therefrom. Since the appellant was entitled to recover the amounts indicated, and appellee was not entitled to a recovery on its cross-complaint of any amount, the court should not have required appellant to pay any of the costs of the suit.

The decree will be reversed, and the cause will be remanded with directions to enter ¡a decree for appellant for the. said amount oif the retained percentage, and the amount conceded to be due for clearing the right-of-way not used, and for costs, and all necessary further proceedings in accordance with the principles of equity and not inconsistent with this opinion. It is so ordered.


author: Kirby, J.,

text:
    Home Building & Savings Association v. Redding.
    Opinion delivered July 9, 1928.

      John D. Arbuckle, for appellant.

      Frank 8. Quinn and Elmer L. Lincoln, for appellee.
   Kirby, J.,

(after stating the facts). The Citizens’ Association on its cross-iappea'l insists that the court erred in using the legal rate of 6 per cent, interest instead of the contract rate of 10 per cent, interest in determining the amount due it under its mortgage, and the contention must be sustained. In Gate City B. & L. Assn. v. Frisby, ante, p. 252, the court laid down the rule for determining the present value of anticipated payments in the foreclosure of a mortgage given by borrowers of building' and loan associations, holding- that the contract rate of interest should govern in estimating the present value of tie principal and unmatured installments, and this case is ruled by the decision therein. The decree on the cross-appeal must be reversed, and remanded with directions to determine the amount due by calculation of the present value of the principal notes and unmatured installments at the contract rate of 10 per cent, interest and for a foreclosure and sale of the property to satisfy the judgment.

Appellant insists that the court erred in refusing to grant a rescission of the contract of sale or exchange of property to the plaintiffs and also in refusing to decree a lien in appellant’s favor upon the Webber Place Addition property, which was conveyed to Dewberry in the sale or trade with Redding, and upon the balance of the notes given by Redding for the purchase money.

In answer to the first contention, it will suffice to say that no appeal was taken by the Reddings from the decree refusing to grant them a rescission of the contract oif exchange of the properties, and we cannot agree with appellant in its second contention that the court erred in not decreeing its claim a lien upon the. Webber Place Addition property, which Dewberry received in the exchange from Mr. Redding, and upon the balance due on the purchase money notes given in such exchange.

Appellant does not allege that it paid any debt or discharged any obligation of Dewberry’s, and rests its claim entirely upon the mortgage for relief, and insists upon a foreclosure thereof, and has no right to subrogation. 25 R. C. L., § 1, p. 1312. The proceeding upon appellant’s part was for a foreclosure of its mortgage, and there was no allegation of any (fraud perpetrated by Dewberry in procuring the loan that entitled appellant to the relief it insists upon here. Alberson v. Klanke, ante, p. 288.

There was no evidence whatever tending to show that the money procured from the appellant association by Dewberry had been used.in the purchase of either of the pieces of property included in the trade or exchange, nor that any beneficial interest therein Was obtained by Dewberry through fraud practiced upon appellant company, nor, as already said, was there any allegation of any such fact, and the court did not err in refusing to fix a lien under appellant’s mortgage against the property conveyed by the Reddings to Dewberry in exchange.for the Witherspoon Addition property. No constructive trust, that could be enforced, arose by operation of law from this transaction in favor of appellant entitling it to subject the exchanged property to the payment of its claim under the mortgage, and the decree dismissing, appellant’s complaint for want of equity must be affirmed. It is so ordered.


author: Mehaefy, J.

text:
    Johnson County v. Hartman.
    Opinion delivered July 9, 1928.

      W. J. Morrow, for appellant.

      J. J. Montgomery, for appellee.
   Mehaefy, J.

. The appellees brought separate suits in the Johnson Chancery Court for an injunction against Fred Russell, as sheriff of Johnson County, Arkansas, to prevent him from paying to the appellant, Johnson County, any of the three-mill road tax and the $3 per capita road tax collected by said sheriff in the respective towns and city of Clarksville, and asked that the sheriff be required to pay to each of the appellees the amount of all road taxes collected in the corporate limits, less his commission.

The appellant, Johnson County, filed an intervention and a demurrer in each of the suits. The cases were consolidated, and one decree rendered. The court overruled the demurrers, and entered a decree dismissing the intervention for want of equity, and enjoined the sheriff from paying the road tax fund or any part thereof collected in said city and towns to Johnson County, and' ordered and directed him to pay to the treasurer of Hartman $315.51, to the treasurer of Lamar $378.80, to the treasurer of Coal Hill $449.16, and to the city of Clarksville, a city of the second class, $2,204.34.

The appellant contends that act 219 of the Special Acts of the Legislature of 1921 was repealed by act 81 of the Acts of 1927. Act 219 of 1921 is “An act to grant to cities and incorporated towns in Johnson County the per capita and road tax collected within such cities- and incorporated towns”; and act 81 -of 1927 is “An act to appropriate 50 per cent, of the road tax collected on real and personal properties situated in the cities of the second class for improvement of the streets in such cities. ”

Section 1 of act 81 of 1927 reads as follows:

“That 50 per cent, of all the road tax collected by the tax collector in any county in this State, by reason of the three-mill road tax now levied by law on all property, both real and personal, situated in the corporate limits of every city of the’ second class in -such counties, ishall be by the collector paid over to the treasurer of every' such city of the second class affected, and placed to the- credit of the street funds of such cities of the second class, to be used exclusively in improving the streets thereof.”

It "will ¡be observed that act 81 does not make any provision for appropriating the per capita tax in any county and does not make, any provision for the appropriation of the road tax except in cities of the second class. It has no reference to incorporated towns. Act 81 of 1927 does not therefore repeal act 219 of the Acts of 1921 as to the per capita tax in cities of-the second class, but does repeal act 219 as to the road tax collected' in cities of the second class in Johnson County. Act 81 of 1927 does not repeal act 219 of 1921 as to the incorporated towns. Appellees insist, however, that § 3 of act 81 makes it plain that the Legislature did not intend to repeal any special law then in force governing the division of the road tax in towns and cities. Said section reads as follows: “That the provisions of this act shall not rescind, repeal or otherwise amend any special law now in force, which governs the division of similar road taxes in any city of the second class within the purview-of this statute”; but act 219 does not govern the division of road taxes in any sense. It specially provides that all of the road tax collected in cities and towns shall be expended in the city and town, and act 81 is a general act applying to every city of the second class in every county in the State. It covers the entire subject of road tax in cities of the second class, but it does not make any provision for the per capita tax nor -any provision for any tax except in cities of the second -class.

It is insisted that the repeal of statutes by implication is not favored in law, and courts will not hold to a repeal if they can find reasonable grounds to hold to the contrary. Appellees earnestly insist that act 81 of 1927 does not repeal act 219 of 1921, and. they call our attention. to numerous authorities supporting the contention that repeals by implication are not favored. We think, however, this question was settled in the case of State v. White, 170 Ark. 880, 281 S. W. 678, where the court said: ; . s! I

“There are certain well settled rules to determine whether or not a former statute has been repealed by a later one, 'but there is always some difficulty, in applying these rules, in determining whether or not a repeal has been effected in a given instance. It is a rule of universal application that implied repeals are not favored, and yet it is equally well settled that there is an implied repeal where there is found irreconcilable repugnance between two statutes, and also where the Legislature appears to have taken up the whole subject anew and covered the entire ground of the subject-matter of the former statute. In a recent decision we undertook to cover this subject in the following statement: “It is a principle of universal recognition that the repeal of a law merely by implication is not favored, and the repeal will not be 'allowed unless the implication is clear and irresistible; but there are two familiar rules or classifications applicable in determining whether or not there has been such repeal. One is that,, where the provisions of two statutes are in irreconcilable' conflict, with each other, there is an implied repeal by the later one which governs the subject, so far as relates to the conflicting provisions and to that extent only. * * * The other one is that a repeal by implication is accomplished where the Legislature takes up the whole subject anew and covers the entire ground of the subject-matter of a former statute, and evidently intends it as a substitute, although there may be in the old law provisions not embraced in the new.” State v. White, 170 Ark. 880, 281 S. W. 678; Conway v. Summers, 176 Ark. 796, 4 S. W. (2d.) 19.

There is certainly irreconcilable repugnance between act 81 of 1927 and act 219 of 1921 as to the road tax in cities of the second class, and therefore the later law repeals the former. It is also true that the Legislature took up the whole subject of road tax in cities of the second class in every county of Arkansas, and it evidently intended act 81 of 1927 as a substitute, so far as the road tax in cities of the second class is concerned. 'This court has said that this may be done, although there may be in the old law provisions not embraced in the new. In this case there is a provision in the old law as to incorporated towns and also a provision as to the per capita tax, and neither of these provisions is in the new law, hut the new law does cover the whole subject of road tax in cities of the second class. There is no repeal of the 1921 law as applied to incorporated towns.

The decree of the chancellor will therefore be affirmed as to the town of Hartman, the town of Lamar and the town of Coal Hill, and will be reversed and remanded as to the city of Clarksville, with directions to enter a decree requiring the payment of only one-half of the road tax collected within the city of Clarksville to said city.