text:
    Wilson v. State.
    Opinion delivered June 30, 1924.
    1. Indictment and information — joinder' of burglary and larceny. — Under Crawford & Moses’ Dig., § 3016, the offenses of burglary and grand larceny may be joined in one indictment.
    2. Criminal law — proof of larceny of things not alleged. — In a prosecution for grand larceny wherein defendant was charged with having stolen certain articles, proof tending to show that certain other articles stolen at the same time and place were subsequently found in defendant’s possession was admissible.
    3. Criminal law — -argument op prosecuting attorney. — Error, if any, in an argument of the prosecuting attorney that a sentence of a year in the reform school would benefit the accused held cured by the court declaring same improper.
    4. Criminal law — argument op prosecuting attorney. — Argument of the prosecuting attorney that “I think the best thing that could happen to him (accused) would be to spend a year in the reform school,” held a mere expression of opinion, and not improper.
    Appeal from Sevier Circuit Court; B. E. Isbell, Judge;
    affirmed.

      E. K. Edwards, for appellant.

      J. S. TJtley, Attorney General, and John L. Garter, Assistant, for appellee.
   Wood, J.

The appellant was indicted for the crimes of burglary and grand larceny. The count for .burglary charged that the appellant feloniously and burglariously did break and enter, the depot house of the DeQueen & Eastern Railway Company with the felonious intent to steal, take and carry away candy, check lines and snuff, the property of the DeQueen & Eastern Railway Company, a corporation, as bailee, of the value of $15. The count for grand larceny charged that the appellant did unlawfully and feloniously steal, take and carry away the property described above of the DeQueen & Eastern Railway Company, a corporation, of the value of $15. The indictment was in good form, and the appellant was put on trial for both offenses. The trial resulted in a verdict finding appellant guilty of the crime of grand larceny and fixing his punishment at imprisonment in the State Penitentiary for a period of one year. From the judgment sentencing him in accordance with the verdict is this appeal.

The testimony adduced on behalf of the State tended to prove that, on the night of May 5, 1923, the station house of the DeQueen & Eastern Railway Company (hereafter called company) at Lockesburg was broken into, and snuff, candy and check lines of the aggregate value of $15 were stolen; that this property was in possession of the company as bailee. The station agent, after testifying that the above property was stolen, also testified, over the objection of appellant, that a little magnifying glass and a knife were taken at the same time. The deputy sheriff who arrested the appellant testified, over the objection of the appellant, in substance that he found a knife and small magnifying glass in the possession of the appellant, which were exhibited to the jury. The station agent testified that the glass belonged to witness and that the knife belonged to a man by the name of Pierce; that the knife introduced looked like the knife that witness missed. There was testimony also to the effect that a candy bucket was found near the place where the appellant was staying at the time of the commission of the alleged offenses. It was shown that the appellant was arrested a couple of weeks after the alleged burglary, and he told the officer at the time of his arrest that he got the knife and magnifying glass from a hobo in a berry patch.

1. The appellant contends that the court erred in admitting the testimony concerning the knife and magnifying glass, because it was not charged in the count for grand larceny that the knife and glass were stolen. Under the statute burglary and grand larceny may be joined. Section 3016, subdivision 8, Crawford & Moses’ Digest. The appellant was on trial for both offenses. The testimony tended to show that the knife and glass were stolen on the night and on the same 'Occasion that the burglary was committed, when the property alleged in the grand larceny charge was stolen. The testimony therefore was relevant to the offenses for which appellant was being tried. It tended to prove that the appellant was guilty of both the crimes of burglary and grand larceny, for these alleged offenses were committed on the same night and on the same occasion. It was an issue for the jury, under the evidence, as to whether the knife and magnifying glass were identified as the knife and glass taken from the depot on the night of the burglary, and the court therefore did not err in admitting the testimony.

2. In his closing argument the prosecuting attorney made the following remarks: ‘ ‘ Gentlemen, when we consider this defendant’s environments and the bad influences he is subjected to, I think the best thing that could happen to him would be to spend a year in the reform school. I believe he would be benefited by such a sentence.” Counsel for the appellant objected to the remarks, whereupon the court stated to the prosecuting attorney: “Mr. Steel, that is an improper argument, and the Supreme Court has so held.” The appellant’s •counsel renewed his objection, and, among other things, stated, “There has been no evidence introduced to show his age or anything to show that he would be sent to the reform school if convicted.” Whereupon, the court remarked, “No, I do not recall any testimony as to his age, and besides, the court is going to take care of the judgment in this case.”

The court’s remarks to the prosecuting attorney were tantamount to informing the jury that the argument was improper, and were sufficient to counteract any prejudicial effect on the minds of the jurors that these remarks were calculated to produce, even if they were improper. But we do not concur with appellant’s counsel in the view that the remarks of the prosecuting attorney were an improper argument. These remarks were but the expression of an opinion on the part of the prosecuting attorney that the appellant would be benefited by a sentence to the reform school. These remarks did not have the effect of informing the jury that the appellant, if convicted, would be sent to the reform school, as was the case in Pittman v. State, 84 Ark. 292, and Bird v. State, 154 Ark. 299. They did not purport to state the law, and were not a misstatement of- any legal proposition, as was the case in the above cases. The .doctrine of those cases has no application here. The mere expression of the opinion of the prosecuting attorney, -under the circumstances, did not constitute reversible error. Blackshare v. State, 94 Ark. 558; Spier v. State, 157 Ark. 282.

The remark of the trial judge that lie was going to take care of the judgment in the case furnished no grounds for an inference that the appellant, if convicted of grand larceny, would be sent to the reform school. This remark merely stated the truth, that the court had control over its judgment, and the only proper inference to be drawn was that the court would render proper judgment in the case. There is no prejudicial error in the record, and the judgment must therefore be affirmed.


source: Caselaw Access Project

author: Hart, J.,

license: Public Domain

text:
    Penix v. Shaddox.
    Opinion delivered June 30, 1924.
    1. Counties — courthouse.—It is the duty of a county to erect and furnish a courthouse and to provide necessary offices for the several county officers.
    2. Counties — authority of county court to assign offices.— Under Crawford & Moses’ Dig., § 2279, the county court has exclusive authority in the matter of assigning offices in the courthouse to the several county officers, and such authority is not exhausted when once exercised, but is continuous, and the assignment of offices may be changed whenever, in the judgment of the county court, the public convenience will be promoted by the change.'
    3. Counties — assignment of offices — appeal.—A county officer aggrieved by the action of the county court in assigning offices in the courthouse should make himself a party to such proceeding and seek a review by the circuit court of the county court’s order.
    4. Equity — jurisdiction over county court. — It is not within the province of a court of equity to correct an error of the county court when proceeding under statutory authority with discretionary powers.
    5. Injunction — restraining sheriff from disobeying county court. — A suit by the county judge to enjoin the sheriff from interfering with the order of the county court designating a room to be occupied by the county treasurer does not lie; the proper remedy being to cite the sheriff for contempt upon his refusal to obey.

      Appeal from Boone Chancery Court; Ben F. McMahan, Chancellor;
    affirmed.
    STATEMENT oe eaots.
    M. O. Penix, as county judge of the court of Boone County, Arkansas, brought this suit against Bob Shaddox to enjoin him from interfering -with the order of the county court in designating a room to be occupied by the county treasurer.
    According to the allegations of the complaint, M. O. Penix is judge of the county court of Boone County, Arkansas, and designated a room in the courthouse which should be occupied by the county treasurer, and in which his records might be securely kept. Bob Shaddox is the sheriff of the county, and occupies the room assigned to the treasurer for his office. He refused to surrender possession of the room to the county treasurer. Hence this lawsuit.
    A demurrer was filed to the complaint on the ground that the chancery court had no jurisdiction of the case. The demurrer was sustained, and, the plaintiff declining to plead further, the complaint was dismissed. The case is here on appeal.

      George J. Grump, for appellant.

      Worthington & Williams, for appellee.
   Hart, J.,

(after stating the facts). It is the duty of a county to erect and furnish a courthouse, and to provide necessary offices for the several county officers. Law v. Falls, 109 Ark. 395.

Section 2279 of Crawford & Moses’ Digest defines the powers generally of the county courts of the State. Among other things, the section provides that the county court of each county shall have the control and management of all the property, real and personal, for the use of the county, and to. cause to be erected all buildings and all repairs necessary for the use of the county.

Thus it will be seen that the county court is given not only the authority to furnish a courthouse, but to provide the necessary offices for the several county officers. This includes the power to designate the rooms which are suitable for each particular office, and the action of the county court in assigning the particular rooms which shall be occupied by the different officers is the act of the county. This power is not exhausted when once exercised, but is a continuing one, and the assignment of offices may be changed whenever, in the judgment of the county court, the public convenience will be promoted by the change.

It appears from the record that Shaddox was the sheriff of the county; but he had no right to choose the room which he should occupy as his office. The law confers no authority upon him to take or hold possession of any room in the courthouse for his office when such room has been assigned by the county court to another county officer. The power of the county court is necessarily exclusive. White v. Hewlett (Ala.), 42 So. 78, and eases cited, and Werts v. Feagle (S. C.) 65 S. E. 226.

If the sheriff thought that the county court was acting in an arbitrary manner in assigning offices for the various county officers, he should have made himself a party to the proceeding and have appealed to the circuit court from the order of the county court assigning rooms to the various county officers. The county court had the statutory authority to make the order, and in making it the question of public convenience was involved and determined. A court of equity has no jurisdiction over the subject-matter for the purpose of opening up the question and determining it anew. It is not within the province of equity to correct the error of a county court when proceeding under statutory authority with discretionary powers. Bowman v. Frith, 73 Ark. 523, and White v. Hewlett (Ala.), 42 So. 78.

It is the duty of the sheriff to attend each term of the county court for his county, and execute all orders mad'e by said court. Crawford & Moses’ Digest, § 2272.

In this case it seems that the sheriff himself was the offending party, and refused to obey the order of the county court. All courts have power to issue all writs and process which may he necessary in the exercise of their respective jurisdictions, according to the principles and usages of law. Crawford & Moses’ Digest, § 2104.

Hence the county court might have cited the sheriff for contempt of court in disobeying its orders, or might have enforced it by any other appropriate process. The result of our views is that the wrong remedy was pursued, and the chancery court was without jurisdiction to enforce the order of the county court in question.

It follows that the decree must be affirmed.


text:
    Coburn v. Gilbert.
    Opinion delivered June 30, 1924.
    1. Evidence — relevancy.—In an action by a broker to recover a commission for procuring a purchaser of land, testimony of the broker relative to a prior partnership arrangement between himself and the principal for the sale of the same land and division of profits, introduced as a narrative of what occurred between them leading up to the contract for commissions, held competent.
    2. Appeal and error — harmless error.— A judgment will be reversed for prejudicial error only.
    Appeal from Saline Circuit Court; T. E. Toler, Judge;
    affirmed.
    STATEMENT OE PACTS.
    T. B. Gilbert sued J. A. Coburn in the justice court to recover $135, alleged to be the balance due him as commissions for the sale of two tracts of land belonging to the defendant.
    The complaint was in writing, and contained two paragraphs. In the first paragraph it is alleged that the defendant employed the plaintiff to procure for him a purchaser for ten acres of land for $2,500, and agreed to pay him therefor a commission of five per cent. The plaintiff procured a purchaser under the contract, and thereby earned $125 as commissions. The defendant paid him $50, and refused to pay the balance of $75.

      In tlie second1 paragraph of the complaint it is alleged that the defendant employed plaintiff to procure him a purchaser for five acres of land for $1,200, and agreed to pay him a commission of five per cent. No part of this amount has been paid, and the defendant owes him $60 for commissions for selling the five-acre tract.
    The defendant filed an answer in which he denied owing the plaintiff anything. There was a verdict and judgment for the plaintiff in the justice court, and the defendant appealed to the circuit court. There .T. B. Gilbert was the principal witness for himself. According to his testimony, J. A. Coburn was a prospective purchaser for the ten-acre tract for the sum of $2,500. The owner first asked $2,750 for it, and Coburn bought other land. Gilbert then sold the ten-acre tract to Dr. W. O. Tibbel for $2,500. About a month after his purchase, Dr. Tibbel authorized Gilbert to sell it for $2,000. Gilbert then went to J. A. Coburn and told him that he could get the place for $2,000, and sold it to him with the understanding that it was to be a partnership deal, and that they were to share equally the profits derived from a resale of it, and that Gilbert was to have the exclusive handling of it. Finally Coburn persuaded Gilbert to let him have the land for $2,000, with the privilege of selling it again for Coburn for a commission of five per cent. Gilbert then found a purchaser who was ready, able, and willing to pay $2,500 for the land. Coburn refused to sell, because he thought there was oil under the land. Coburn paid Gilbert $50 as commission, and refused to pay him any more. Gilbert also procured a purchaser for the five-acre tract at $1,200, and Coburn refused to sell it, because he thought there was oil under the tract. He refused to pay Gilbert any commission on this tract.
    J. A. Coburn was a witness for himself. According to his testimony, Gilbert had agreed with him that, in case of a resale of the land, he would pay any tenant Coburn had on the land whatever was necessary to get rid of him. Gilbert refused to carry out his agreement in this respect, and, for that reason, Coburn refused to let him sell the land. They finally compromised their differences in the matter by the payment of Coburn to Gilbert of $50. According to Coburn, this $50 was in full settlement of the matter. Gilbert denied this, and said that he only took it in part payment of his commissions.
    The jury returned1 a verdict in favor of the plaintiff in the sum of $75, and from the verdict rendered the defendant has duly prosecuted an appeal to this court.

      Brouse •<& McDaniel, for appellant.

      J. W. Westbrooh, for appellee.
   Hart, J.,

(after stating the facts). The sole reliance of the defendant for a reversal of the judgment is that the circuit court erred in admitting the testimony of T. B. Gilbert with reference to a division of profits upon a resale of the land. It appears that Gilbert bought the land1 from Coburn for $2,000. It was first agreed between them that the land should be resold, and that they should share equally in the profits. It is claimed by counsel for the defendant that the court erred in allowing this testimony to go to the jury. We do not-agree with counsel in this contention. The evidence referred to was only admitted by way of leading up to the contract which was made between the parties, with reference to the commissions to be received by the plaintiff for a resale of the land for the defendant. The testimony in question was not admitted for the purpose of establishing the claim of the plaintiff for commissions, but only as a narrative of what occurred between them leading up to the’contract they made. The plaintiff testified that the defendant finally persuaded him to take the agency for the sale of the ten-acre tract of land for a five per cent, commission. A written complaint was filed in the case, and the plaintiff only asks to recover the balance due him on a basis of a five per cent, commission for a sale of the ten-acre tract for the defendant. He procured a purchaser for this ten-acre tract for $2,500, and the defendant refused to sell. The plaintiff received $50 from the defendant, and this would leave a balance due him of $75. The jury returned a verdict for him in this amount, thus indicating that it believed the testimony of the plaintiff: to the exclusion of that of the defendant. No amount whatever was allowed the plaintiff for the sale of the five-acre tract. , i

The pleadings and the evidence introduced, when considered in connection with the verdict of the jury, show that it was in no wise misled by the evidence in question. No prejudice could have resulted to the defendant from admitting the evidence, and it is well settled in this State that a judgment will only be reversed for an error prejudicial to the rights of the appealing party.

It follows that the judgment will be affirmed.


author: Smith, J.

text:
    Haffke v. Hempstead County Bank & Trust Company.
    Opinion delivered June 30, 1924.
    1. Mortgages — delivery of itemized statement of account— waiver. — Delivery to a mortgagor of a verified itemized statement of the account secured by the mortgage before foreclosing a chattel mortgage was waived where the mortgagee presented .an unverified but correct account, to which the mortgagor made no objection.
    2. Equity — jurisdiction to foreclose .mortgage of decedent.— Equity had jurisdiction to foreclose a mortgage executed by decedent and another where it made no order for payment of any deficiency judgment against decedent’s estate, but found the balance due by decedent and ordered foreclosure therefor.
    3. Crops — deeds held to convey. — Deeds executed on March 31 and June 30, neither containing any reservation of crops, held to carry the title to a crop on the land.
    4. Husband and wife — estoppel.—Where a wife permitted the 1921 crop to be appropriated to paying her husband’s debt to a bank, without advising the bank that she had'an interest in the land, and the bank made advances in 1922 upon the- faith of the husband’s mortgage on the crop, the wife is estopped to assert any . right to rents- out of such crop. ...
    Appeal from Hempstead Chancery Court; G\ E. Johnson, Chancellor;
    affirmed.

      E. F. McFaddin, f or appellant.
    The court erred in not sustaining the plea in abatement of Charles Haffke. Section 7403, C. & M. Digest; 65 Ark. 316; 73 Ark. 789. The statute is mandatory. 92 Ark. 313; 123 Ark. 265; 136 Ark. 516. A conversion of mortgaged property to his own use by the holder of the mortgage satisfies the mortgage debt to the extent of the value of the property. 11 Corpus Juris, 686. The intervention of Margaret B. Haffke should have been sustained. 30 C. J. 838; 50 Ark. 42; 62 Ark. 26; 69 Ark. 350; 74 Ark. 161; 107 Ark. 458; 92 Ark. 315; 142 Ark. 104.; 157 Ark. 254.
    Wto. S. Atkins, for appellee.
   Smith, J.

On January 17, 1923, the Hempstead County Bank & Trust Company, hereinafter referred to as the bank, filed a complaint in equity against Charles Haffke, who was the only defendant named. In this complaint the appointment of a receiver was prayed to take charge of certain personal property mortgaged to the bank by Haffke. The complaint described a number of mules and certain farming implements, and there was a prayer that the property be ordered sold in satisfaction of certain mortgages executed to the bank. There were two of these mortgages, and each covered the property described. The first was executed by Charles Haffke and Pressley J. Barr. The second was executed on March 8, 1922, by Haffke alone.

Haffke filed a motion to quash the specific attachment which the bank had caused to .be issued, on the ground that the bank had failed to comply with § 7403, C. & M. Digest, which requires the mortgagee, before foreclosing a chattel mortgage, to deliver to the mortgagor a verified itemized statement of the account, showing all items of debit and credit. This motion was overruled, and the bank later filed an amended complaint in which the executor of Barr was made a party defendant. As an exhibit to this complaint an itemized verified statement of the account was attached. Later the wife of Haffke intervened and claimed an interest in the rent, as an owner of an interest in the land.

The executor of Barr demurred to the complaint on the ground that the chancery court was without jurisdiction to adjudicate an indebtedness against his testator. The demurrer was overruled, and exceptions saved. The court also found against the intervention of Mrs. Haffke. The court then found that there was a balance due the bank, as shown by the statement of the account, and entered a decree of foreclosure. Other facts will be stated 1 in the opinion.

It does not appear that the bank complied with § 7403, C. & M. Digest, but we think this failure was waived1. At the winding up of the crop for the year 1922 it was shown that Haffke could not pay his debt to the bank; indeed, .the indebtedness had increased over that of the preceding year. It appears that the bank furnished Haffke a statement of the account about the first of December, 1922, which was, of course, prior to the institution of the suit in January, 1923. This statement was not verified, but its accuracy does not appear to have been questioned at that time. It was the same statement which was made a part of the amended complaint. At the time this statement was furnished in December, 1922, no objection was made to its form, and Haffke appears to have fully understood the amount claimed by the bank. Haffke’s insistence at that time was that the bank should extend him additional credit to make his crop in 1923, and it appears reasonably certain that no objection to the account or to the balance claimed as due would have been made had the credit been extended.

This court held, in the case of Lawhon v. Crow, 92 Ark. 313, that the legislative purpose in enacting the statute now appearing as § 7403, C. & M. Digest, was not merely to save the mortgagor the cost that might be incident to a lawsuit, but also to prevent annoyance and inconvenience to him by having his property taken from him by process of law before giving him an opportunity to adjust any differences with the mortgagee and to settle his account, if possible, without a lawsuit, and that it had therefore been made a condition precedent to the maintenance of a suit to foreclose a chattel mortgage, or to recover the possession of the mortgaged property, that the mortgagee furnish the mortgagor a verified statement of the account. But here the purposes of the law have been fully met. The mortgagor knew the sum claimed1, and he apparently acquiesced in the demand made by the bank. The question considered between the mortgagor and the mortgagee was that of the extension of additional credit, and this was considered by the directors of the bank at more than one meeting, and, when the bank finally declined to accede to Haffke’s demand' for additional credit, he stated that it was the bank’s next move.

Under these circumstances we think a strict compliance with the statute was waived, and the motion to dismiss for noncompliance with the statute referred to was properly overruled.

We think the court also properly overruled the demurrer >of the executor of Barr’s estate to the jurisdiction of the chancery court. The court assumed jurisdiction of the proceeding, so far as the executor was concerned, for the purpose only of ascertaining the balance due and1 secured by the mortgage which the testator had executed, and the court had this jurisdiction. The court undertook to make no order for the payment of any deficiency judgment against the testator’s estate, but found the balance due by him under the mortgage which he had executed, and ordered its foreclosure.

The executor also claimed, for the benefit of his estate, an interest in the 1921 crop, which the court refused to allow. The court also found against the intervention of Mrs. Haffke for an interest in the 1922 crop, and this appeal questions the correctness of both those findings. These questions may be disposed of together, as both claims arise out of the same facts.

P. J. Biarr died Marcí 31, 1921, which was prior to the planting of the crops for that year. On March 25, 1921, P. J. Barr conveyed by warranty deed to Ralph W. Barr his interest in the land on which the crops were grown. Ralph W. Barr executed a power of attorney to appellant Charles Haffke, who was his brother-in-law, and!, pursuant to this power, Haffke, on June 30, 1921, conveyed the interest originally owned by P. J. Barr to Margaret B. Haffke, who was the sister of Ralph W. Barr and the wife of Charles Haffke. This deed contained no reservation' of the crops then growing on the land, nor did the deed from P. J. Barr to Ralph W. Barr. The crop of 1921 was marketed and the proceeds thereof turned over to the bank, to be credited on the indebtedness of P. J. Barr and Charles Haffke, which was secured by the mortgage which they had executed to the bank. Mrs. Háffke claimed no interest in the 1921 crop. By her intervention she claimed a part of the rent for 1922:

We think the deed from P. J. Barr to Ralph W. Barr and the one from Ralph W. Barr to Mrs. Haffke operated to convey the interest of the grantors in the crops to the grantees named, and the court therefore properly held that the executor of P. J. Barr was not entitled to recover any part of the 1921 crops. Gibbons v. Billingham, 10 Ark. 9; Lee v. Bandimere, 140 Ark. 277; Nelson v. Forbes & Sons, 164 Ark. 460.

P. J. Barr appeared to have owned an undivided 41% per cent, interest in the land, and this is the interest acquired by Mrs. Haffke through the deed to her, and under it she asserts an interest in the rent for 1922 to that extent, as she did not sign any of the notes secured by the mortgage on the personal property and was not a party to that instrument. Her intervention raised this question.

We think the court properly found against the intervention of Mrs. Haffke for the following reasons: She permitted the 1921' crop to be appropriated to the debt due the bank without advising the bank that she had any interest in the land on which she conld predicate a claim to an undivided interest in the crop. We think she must have known that her husband represented to the bank, as a basis for the credit extended him in 1922, that he had the right to mortgage the crops. On March 8,1922, Haffke wrote a letter to the bank in regard to the indebtedness then due and the additional advances which he was asking the bank to make him that year. In this letter he said: “I have made my calculation as to what it will take to furnish my place, necessary to insure cropping the entire place for 1922, ’ ’ and, after stating his demands, he advised that he could, with certain other assistance which he expected to obtain, “cultivate my entire farm.”

The bank made the advances for the year 1922, and it was upon the faith of the security of the chattel mortgage here sought to be foreclosed upon the 1922 crop, and, as Mrs. Haffke permitted the bank to extend this credit under the belief that Haffke had the right to mortgage it, she is estopped from asserting that he had no such right. Driggs Bank v. Norwood, 50 Ark. 42; George Taylor Commission Co. v. Bell, 62 Ark. 26; Cowling v. Hill, 69 Ark. 350; Davis v. Yonge, 74 Ark. 161; Haycock v. Tarver, 107 Ark. 458; Latham v. First National Bank, 92 Ark. 315; Irwin v. Dugger, 142 Ark. 104; Harmon v. Winegar, 157 Ark. 254.

The decree adjudged the balance due and secured by each of the mortgages mentioned, and ordered their foreclosure in satisfaction thereof. This decree appears to be correct, and it is affirmed.


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

text:
    Republic Power & Service Company v. Gus Blass Co.
    Opinion delivered June 16, 1924.
    1. Corporations — power of state over foreign corporations.— The only limitation of the State’s power to impose conditions on foreign corporations doing business in the State is with respect to corporations engaged in interstate commerce.
    2. Corporations — foreign corporations — conditions.—Neither a foreign corporation purchasing an interest in oil and gas leases in Arkansas without having complied with the statutory requirements as to doing business in the State (Crawford & Moses’ Dig., §§ 1825-1832), nor its assignee, can enforce its executory contracts, either at law or in equity.
    3. Contracts — when executed. — A contract is “executed” when whatever is contracted to be done on either hand has been done.
    4. Corporations — when contract op foreign corporation not executed. — The contract of a foreign corporation to purchase an interest in oil leases held by another than the seller for the benefit of all persons interested, was not executed, where such corporation was not given possession and the holder of leases refused to recognize its right to share therein.
    5. Corporations — foreign corporations — assignment of unlawful contract. — Where a foreign corporation contracted in this State to purchase oil leases without complying with the laws as to doing business in the State, its assignee, whether by contract or by law, cannot enforce rights under such contract if the contract must be proved to make out the case.
    6. Corporations — foreign corporations — subsequent compliance WITH statute. — The fact that a foreign corporation, which executed a contract in the State without complying with the State laws as to doing business, subsequently complied with the statute gives it and its assignee no right to enforce such contract.
    Appeal from Ouachita Chancery Court, Second Division; George M. LeCroy, Chancellor;
    affirmed.
    statement op pacts.
    The Republic Power & Service Company brought this suit in the chancery court against Gus Blass Company and Joe House, Jr.
    According to the allegations of the complaint, on May 27, 1919, eight persons,' including S. R. Morgan, entered into a written agreement to associate themselves together for the purpose of securing leases for oil and gas in Ouachita County, Arkansas. The leases were to be taken in the name of J. ¡W. House, Jr., and held by him for the benefit of all of them. It was agreed that all advances made by the parties to carry out the provisions of the contract between them should be made to J. W. House, Jr., and that he should keep an account of the moneys received. They secured oil and gas leases in the name of J. W. House, Jr., for the benefit of the other persons in interest, to numerous tracts of land in Ouachita County, Arkansas. On the 30th day of June, 1920, S. R. Morgan executed what is called a bill of sale to Morgan & Company of Delaware to his one-eighth undivided interest in said oil and gas leases, which aggregate about 20,000 acres, and the title to which is in the name of J. W. House, Jr., as trustee for himself, for S. R. Morgan, and the other interested parties. The bill of sale was acknowledged before a notary public in the city of Little Rock, Pulaski County, Arkansas, on the same day. It was then delivered in Little Rock to a representative of the grantee. The grantee was a foreign corporation, and, at that time, had not complied with the laws of the State of Arkansas with reference to foreign corporations doing business in the State. Subsequently the Republic Power & Service Company succeeded to the rights of Morgan & Company and complied with the statutes of the State with reference to doing business in the State.
    On May 3, 1921, the Gus Blass 'Company recovered judgment against S. R. Morgan in the Pulaski Circuit Court. On May 14, 1921, an execution was issued and returned nulla bona. The Gus Blass Company then brought suit in the chancery court against S. R. Morgan and J. W. House, Jr., to subject the interest of S. R. Morgan in said oil and gas leases to the payment of its judgment against him in the sum of $604.15. A decree was obtained in favor of the Gus Blass 'Company, and the one-eighth interest of S. R. Morgan was duly sold for the satisfaction of said judgment, and the Gus Blass Company became the purchaser at the sale for the amount of its judgment and the costs.
    Morgan & Company complied with the law with regard to foreign corporations doing business in the State, and received its certificate to that effect on September 26,1921. Morgan & Company was chartered as a corporation in the State of Delaware on the 14th day of May, 1920. On January 9,1922, the name of this corporation was changed to the Republic Power & Service Company.
    The prayer of the complaint in this case is for a partition of said oil and gas leases between the plaintiff, Republic Power & Service Company, and the other parties interested therein.
    It is also asked that the claim of the- defendant, the Gus Blass Company, be canceled and held for naught in said oil and gas leases; that said J. W. House, Jr., be restrained from recognizing or attempting to recognize the right or claim of the said Gus Blass Company, and that, if it be held that the lien of the said Gus Blass Company be superior to the right of the plaintiff, an adjudication of the amount be had, and that, upon payment of the amount thereof by plaintiff, its title and interest in said oil and gas leases be confirmed and quieted.
    Upon the facts stated and proved, the chancellor was of the opinion that the complaint should be dismissed for want of equity. A decree was entered of record accordingly, and the plaintiff has duly prosecuted an appeal to this court.

      Carmichael & Hendricks, for appellant.
    The plaintiff was entitled to maintain the suit. The sale by Morgan of his interests in cértain lands, made in St. Louis, to a foreign corporation not authorized yet to do business in Arkansas, was in the nature of interstate business. Appellant should prevail under the authority of 151 Ark. 269 and 157 Ark. 121. Judgment hens are subject to valid liens on the land at the time the judgment is rendered, whether recorded or not. 33 Ark. 328. Appellant was never made a party to the suit, which was to set aside a fraudulent conveyance. Land conveyed for the purpose of defeating creditors is not subject to the lien of a judgment, and a fortiori, if there was a conveyance in good faith, the vendee’s rights would be superior to those of a judgment creditor. Ill Ark. 11; 67 Ark. 325; 113 Ark. 109.

      Hamp Smead, Coleman, Robinson & House, and Smead Powell, for appellee.
    Appellant can claim no rights under the bill of sale because it was not authorized to engage in business in this State at the time of its execution. Section 1832, C. & M. Digest. The transaction was had in Arkansas, and was in line with the particular business of the foreign corporation, and therefore void. 98 So. 787. There was ample evidence to sustain a finding that the bill of sale was made with intent to defraud creditors. Retention of possession by a grantor is a badge of fraud. 88 Ark. 433; 50 Ark. 289; 55 Ark. 116. See also 12 R. C. L., p. 480, § 12; 106 Ark. 230 ; 73 Ark. 174. While Morgan could sell his interest, such sale did not necessarily make the purchaser a partner of the others, as the purchaser has only a right to an accounting and settlement of the partnership affairs. 20 R. C. L. § 217. Appellant is concluded by the judgment against Morgan, as its rights had not then vested. 23 Cyc. 1253, 1260.
   Hart, J.,

(after stating the facts). It is well settled that the only limitation upon the power- of the State to exact conditions upon which foreign corporations may transact business within its borders is where such corporations are engaged in interstate commerce, and that this limitation arises only because the Federal Constitution has committed to Congress the power to regulate commerce between the States. Kansas City Structural Steel Co. v. State, 161 Ark. 483; Browning v. Waycross, 233 U. S. 16, and Mitchell Furniture Co. v. Selden Brack Construction Co., 257 U. S. 282.

' Our statutes prescribing the conditions upon which foreign corporations may be authorized to do business in this State are contained in Crawford & Moses’ Digest, §§ 1825-1832, inclusive.

Section 1832 provides that any foreign corporation which shall fail to comply with the provisions of the act, and.which shall do any business in this State, shall be subject to a fine as provided in the act.

The section further provides that, as an additional penalty, any foreign corporation which shall fail or refuse to file its articles of incorporation or certificate, as aforesaid, cannot make any contract in this State which can be enforced by it, either in law or in equity, and that compliance with the provisions of the act after the date of any such contract, or after any suit is instituted thereon, shall in no way validate said contract. ,

At the time Morgan & Company purchased the one-eighth interest of S. R. Morgan in the oil and gas leases referred to in our statement of facts, it was a foreign corporation, and had not complied with the provisions of our statute with reference to doing’ business in this State. It had therefore, under the statute, no legal right to make any contract in this State which could be enforced by it, éither in law or in equity. By the terms of the statute it has no recognition in the courts of this State, and the plaintiff, which is its assignee, acquired no greater rights.

It is well settled by the authorities cited above, and other decisions from these courts, that the States have the power to impose such conditions as they please upon foreign corporations seeking to do business within their borders.

In the decision cited from this court a review of our former decisions is made, and the distinction is pointed out between a contract which is so connected with an interstate transaction that it is a part of it, and a contract which is so inherently intrastate that it does not lose its essential nature because it forms a part of an interstate commerce transaction to which it has no necessary relation.

No question of interstate commerce is here involved. There was only one transaction, and that was the sale by S. R. Morgan to Morgan & Company, a foreign corporation, of the former’s undivided one-eighth interest in certain oil and gas leases taken in the name of J. W. House, Jr., and held by him for the persons beneficially interested, including S. R. Morgan. This contract was evidenced by an instrument in writing called a bill of sale. It was prepared, signed, and acknowledged in tbe city of Little Rock, Arkansas, and there delivered to a representative of tbe foreign corporation.

It will be remembered that tbe Republic Power & Service Company succeeded to tbe rights and name of Morgan & 'Company. Tbe contract having been made and tbe business transacted in tbe State of Arkansas, tbe transaction was essentially an intrastate one.

It is insisted that, although the contract may be an intrastate one and void1 under tbe statute, and not enforceable under it, a different rule prevails where the contract is fully executed.

It is pointed out that tbe former decisions of this court are in line with this doctrine, and fully recognize tbe distinction between executory and executed void contracts, to tbe effect that, while suits to enforce tbe former may always be defended on tbe ground of their invalidity, no relief prayed on such ground can be granted with respect to tbe latter.

Now tbe contract under consideration could in. no sense be said to be an executed contract. An executed contract is one where whatever is contracted to be done on either band has been done.

In the present case a bill of sale of tbe undivided interest of Morgan in tbe leases was executed and delivered to an agent of the foreign corporation; but no possession was given tbe foreign corporation of tbe leases; nor did House in any manner recognize its right or interest in tbe same. On the other band, he refused to recognize tbe right of tbe foreign corporation to any share in the leases, and, on that account, was made a defendant to this lawsuit. One of tbe objects of tbe lawsuit was to establish tbe right of the plaintiff to an interest in the leases under his contract from Morgan; another was to require House to recognize tbe plaintiff as a party in interest; and tbe third was to secure a partition of tbe plaintiff’s alleged share in tbe leases.

The test to determine whether the plaintiff is entitled to recover in an action like this, or not, is his ability to establish his case without any aid from the illegal transaction. If his right to recover depends on the contract which is prohibited by statute, and1 that contract must necessarily be proved to make out his case, there can be no recovery. Cary v. Watkins, 97 Ark. 153; Tallman v. Lewis, 124 Ark. 6; and Carter v. Bradley County Road Imp. Dists. 1 and 2, 155 Ark. 288.

The leases are in the possession of House, and the legal title is in him for the benefit of the parties designated therein. House refused to recognize any right of the plaintiff in the leases. The statute, however harsh its terms may be, is, as we have already seen, a valid and enforceable act. It provides, in express terms, that any foreign corporation which has failed to file its articles of incorporation or certificate as provided, cannot make any contract in this State which can be enforced by it, either in law or in equity.

Now it is evident that the plaintiff could not recover without introducing the contract under which it claims in evidence. It has therefore no legal right to demand partition of the leases or possession of any share therein. It does not make any difference that the Hus Blass Company has obtained possession of Morgan’s interest in the leases by legal proceedings. The plaintiff must recover on the strength of its own title, and, as we have already seen, has no claim of any kind without introducing in evidence its contract of purchase from Morgan. To allow it to recover by introducing in evidence a contract absolutely void under the statute would defeat the main purpose of the statute.

Under our statute it makes no difference that the foreign corporation has subsequently complied with the statute. This gives it no right to enforce a contract made before its compliance with the statute.

It follows that the decree will be affirmed.

McCulloch, C. J.,

(dissenting). The statutes of this State do not prohibit a foreign corporation from acquiring property in the State, nor from suing in the courts to recover property or to seek redress for damage to property thus acquired. Railroad Co. v. Fire Association, 60 Ark. 325; Alley v. Bowen-Merrill Co., 76 Ark. 4; Rachels v. Stecher Cooperage Co., 95 Ark. 6; Linton v. Erie Ozark Mining Co., 147 Ark. 331. In the absence of such a statute, foreign corporations may acquire property in a State and sue for in the courts of the State. Cowell v. Springs Co., 100 U. S. 55. The only inhibition in our statute is that a foreign corporation shall not do business or make contracts in the State without complying with the statute.

The effect of the transaction now condemned by the majority of this court as unlawful was merely the acquisition of property by purchase — a consummated sale and purchase of personalty. It was not an executory contract for sale, but a consummated one. The bill of sale delivered by S. R. Morgan to the corporation completely consummated the sale — nothing remained to be done to complete it. Herein lies the error into which, I think, the majority have fallen. Morgan had no writing evidencing the lease to deliver — the leases were held in the name of Mr. House as trustee for himself and his associates, including Morgan, and the only way Morgan could transfer his interest was by separate bill of sale, which evidenced a completed sale and passed title to the purchaser. What more could Morgan have done to pass title to the corporation? If the title passed, there was no executory contract involved. The bill of sale was introduced as evidence of title, the same as a deed to realty, and not as a contract to be enforced by decree of the court.

This is a controversy between Morgan’s creditor and the corporation to which Morgan sold his interest in the lease. The sale is not shown to have been fraudulent, so if it was completed so as to pass title, the property became that of the purchaser, and the creditor of Morgan cannot complain. The situation is the same, I think, as if Morgan had conveyed land to the corporation and the creditor was seeking to set aside the conveyance. If the conveyance was free from fraud, it passed beyond the reach of creditors.


author: Hart, J.

text:
    Arkansas Natural Gas Company v. Norton Company.
    Opinion delivered June 23, 1924.
    1. Gas — corporation held to be public utility. — Where a corporation authorized to produce, transport and sell natural gas exercised the rights and privileges of a public utility, and filed a schedule of rates, and subjected itself to control by State authorities, it constituted itself a public utility for the purpose of furnishing natural gas, and was subject to statutory regulations.
    2. Gas — public utility. — A corporation supplying natural gas to customers cannot be considered as a public utility with respect to certain classes of consumers and a private corporation as to certain others.
    3. Gas — public utility — distinction between consumers. — While a corporation supplying gas to consumers cannot arbitrarily discriminate among consumers similarly situated, a distinction may be made between different consumers or classes of consumers on account of location, amount of consumption, or such other material conditions which distinguish them from each other or from other classes.
    4. Gas — power op corporation commission to fix rates. — It was beyond the power of a natural gas company, operating as a public utility, to contract with respect to furnishing gas so as to interfere with the power of the Corporation Commission to regulate rates for gas furnished.
    5. Gas — power of gas company to enforce rate-fixing contracts. —Where a natural gas company subjected itself to the control of the Corporation Commission, under Crawford & Moses’ Dig., §§ 1653-1656, and was granted an indeterminate permit to surrender its franchise and be released from its contracts, and failed to apply for reinstatement of such contracts, as provided by Gen. Acts 1921, p. 1.77, creating the Railroad Commission in lieu of the Corporation Commission, it lost its power to enforce the rates provided in such contracts.

      6, gas — power to enforce rate-fixing contracts — construction of statute.: — Gen. Acts 1921, p. 177, creating the Railroad Commission, providing by § 22, as amended by Id. p. 429, § 1, that such Commission shall have no power to modify or impair any existing contract for supplying gas, meant that the validity of any such contracts shall not be impaired, and does not intend to give to such contracts any validity or continuing force which they did not have at the time the act was passed, and power to enforce rate-fixing contracts previously released was not preserved to the gas company by such act.
    7. Gas — PAYMENT BY CONSUMER HELD INVOLUNTARY. — Where a public utility threatened to shut off the supply of gas if a consumer did not pay the increased rate without protest, money paid under such circumstances, though without protest, was not paid voluntarily.
    Appeal from Pulaski Chancery Court; John E. Martineau, Chancellor;
    affirmed.

      Bose, Hemingway, Cantrell & Loughborough, for appellees.
    The gas company was acting as a public utility in its service to the industrial consumers of the gas it supplied, and, as such, had no right to charge more than the rates established by the rate-fixing bodies of the State. Any contract or agreement the gas company might make with a consumer, whereby it charged higher than the established rates, was void. As to whether or not the gas company was acting as a public utility, see Clear Cr&eh Oil & Gas Company v. Fort Smith Spelter Company, 148 Ark. 260, and the clear test set forth at page 273. The Dally letter of November 24, 1920, which set forth the terms on which the gas company would abstain from cutting off the gas of the Bauxite company in trying to enforce a higher rate than that permitted by law, would, as stated above, be void and without any contractual force. Act 571, Acts 1919, §§'7, 8, 30; 149 Ark. 502, 507; 161 Ark. 549; 100 Ark. 22. The agreement to pay the 45c rate was clearly only to do so until appellant had made the application to the Corporation Commission then contemplated, and that application has been disposed of. There can be no doubt that, when Mr. Dally made his agreement with Mr. Murray, embodied in the letter from Mr. Dally to Mr. Neilson, dated November 24, 1920, he had in mind that the gas company would only charge the 45c rate until the Commission passed on the application of the gas company for.a higher rate, and that, if this application was denied by the Commission, or a lower rate put in force, refund would immediately be made to the Bauxite company.

      Moore, Smith, Moore <& Trieber, for appellant.
    1. The parties understood by the contract entered into between the gas company and the Bauxite company in September, 1920, as evidenced by letter of A. B. Dally, Jr., a vice-president of the gas company, to W. C. Neil-son, president of the Bauxite company, under date of November 24, 1920, that the refund was to be based on the rate as finally established, if a. lower rate than the 45c rate was put into effect, as is shown by Mr. Neilson’s telegram to the gas company, dated December 11, 1920, which withdrew the interpretative clause in his letter of November 30, 1920, and his effort to amend the contract in his letters of December 7 and 9,1920, and this view is supported by the finding of the chancellor that the refund was to be based on the rate as “ultimately established.” The persuasive effect of this finding of the chancellor will not be overturned if it is consistent with a reasonable interpretation of the evidence of the respective parties.
    2. The Arkansas Railroad Commission was prohibited by the terms of act 443, Acts 1921, approved March 25, 1921, amending act 124, Acts 1921, approved February 15, 1921, from modifying or impairing the obligation of the contract entered into between the gas company and the Bauxite company in the fall of 1920, prescribing the rate for the supply of gas to the Bauxite company, and the conditions upon which a refund would ■be made, if a lower rate was ultimately established for the bauxite district. 261 U. S. 379.
    3. The conditions of service to ' the Bauxite and Norton companies are so dissimilar from the conditions affecting other industrial users as to permit the gas company to charge them a higher rate than the rates charged other industrials, and to make private term contracts with them not affected by the general rates prescribed the ordinary industrial user. ■ The gas company has the right to make private contracts for the supply of industrial gas, based on competitive price of other fuels, and the cost to the particular consumer of the use of gas as a fuel unaffected by Commission regulation.
   Hart, J.

Separate suits were brought by the Norton Company and the American Bauxite Company against the Arkansas Natural Gas Company in the chancery court to recover overcharges for gas furnished by the defendant, and also to enjoin the defendant from cutting off the supply of gas of the plaintiff. The cases involve in the main the same issues, and were consolidated for the purpose of trial.

The Norton Company is a corporation engaged in the business of manufacturing grinding wheels, and has a plant at Bauxite, in Saline1 County, Arkansas, for the drying of bauxite, which it uses in its business.

The American Bauxite Company is a corporation engaged1 in crushing and drying bauxite at its plant at Bauxite in Saline County, Arkansas. Both corporations use gas and other fuel in the conduct of their business. The Arkansas Natural Gas Company is a public utility engaged in the. business of supplying natural gas to consumers in certain cities, towns and villages and the territory adjacent thereto in the State of Arkansas. •

The Norton Company and the American Bauxite Company were consumers of natural gas furnished at their manufacturing plants by the Arkansas Natural Gas Company. On October 28, 1920, the Norton Company brought suit in equity against the Arkansas Natural Gas Company to enjoin it from shutting off its supply of gas for the reason that the plaintiff would not pay the increased price for gas, which it claimed was unreasonable.

On the 2d day of May, 1922, the American Bauxite Company brought suit .in the same chancery court, against the Arkansas Natural Gas Company to restrain it from cutting off its supply of gas and for the recovery of the amount of overcharge which the defendant had illegally exacted from the plaintiff.

A separate decree was rendered in favor of each plaintiff against the defendant on January 24, 1923. By consent of all parties, an order was made consolidating the cases, not only for the purpose of trial in the chancery court, but for the purpose of appealing to this court.

The Arkansas Natural Gas Company has perfected an appeal to this court from the decree against it in each of said cases.

It is earnestly insisted by counsel for the defendant that its business of supplying natural gas to users for industrial and manufacturing purposes is a private business, and that in this respect it is not subject to the regulation of its rates as a public utility.

We cannot agree with counsel in this contention. The Arkansas Natural Gas Company is a corporation organized under the laws of the 'State of Delaware. Its charter authorizes it to prospect for and produce petroleum and natural gas, to transport the same by pipe lines, and market and sell the same. Its charter further authorizes it to lay, maintain, 'and operate pipe lines for the carriage of natural gas, and to purchase or otherwise acquire natural gas and to transport and pipe the same by means of pipe lines, etc., and to market and sell the same.

The Arkansas Pipe Line Company was organized under the laws of the State of Arkansas. Its charter authorized it to produce and market mineral oils and natural gas for heat, light and power by means of pipe lines from without the State to points within the State, or between points wholly within the State, with all the rights incident thereto, including the right to construct and operate telephone and telegraph lines. This company crossed public roads with its pipe lines whenever necessary, and applied to various county courts for permission to do so. In one instance it filed a condemnation- suit and made a deposit, as in other condemnation cases. It purchased right-of-way for its pipe lines from railroad companies and from private individuals and corporations. It laid its pipe lines from a point in the State of Louisiana in a northerly direction to the city of Little Rock, in the State of Arkansas, and, in laying its pipe lines, crossed numerous public roads and the right-of-way of several railroads.

The Arkansas Natural Gas Company took over all the property of the Arkansas Pipe Line Company, together with all the rights it had acquired under -the exercise of the power of eminent domain, or the right to exercise that power under the statutes, as a corporation organized under the laws of the State for the purpose of producing natural gas and transporting or conveying it to market by and through pipe lines.

The Arkansas Natural Gas Company also commenced to exercise all the rights and privileges of a public utility, and filed a schedule of rates, and otherwise subjected itself to the regulation and control exercised over public utilities by the duly constituted authorities of the State of Arkansas. By doing these acts the defendant constituted itself a public utility for the purpose of furnishing natural gas to domestic and industrial consumers, and is subject to all the regulations prescribed by statute for utilities of this sort. We think this clear from the principles of law decided in Clear Creek Oil & Gas Co. v. Fort Smith Spelter Co., 148 Ark. 260, and 161 Ark. 12.

Counsel for appellant concedes, that the Arkansas Natural Gas Company, is a public utility, so far as supplying natural gas to domestic and industrial consumers in the city of Little Rock is concerned, but claims that it is not such public utility with reference to the Norton Company and to the American Bauxite Company, which are situated outside of the city of Little Rock, and which, it is claimed, on account of their peculiar location and of the large amount of gas they use, are not susceptible of being classified.

Now, a corporation supplying natural gas to consumers cannot be considered as a public utility with respect to certain classes of its consumers and as a private corporation with regard to certain others. The acceptance by the Arkansas Natural Gas Company of the franchise and1 privileges granted it carried with it the duty of supplying all persons and corporations along the lines of its main with natural gas, without discrimination. All are entitled to have the same service on equal terms and at a uniform rate. The law will not tolerate a discrimination in the charges of public utility corporations. If this were not so, and if corporations existing by grant of public franchises, in supplying water, gas, electric lights and the like, could favor certain individuals 'or corporations with low rates and charge others higher rates for the same service, the business interests and domestic comforts of every one would1 be at their mercy.

In this connection it may be stated that, while public service corporations cannot act arbitrarily, or discriminate among their consumers similarly situated by way of favoring one consumer or class of consumers over others, a distinction may be made between different consumers or classes of consumers on account of location, amount of consumption, or such other material conditions which distinguish them from each other or from other classes. Yancey v. Batesville Telephone Co., 81 Ark. 486; Southwestern Telegraph & Telephone Co. v. Sharp & White, 118 Ark. 541, and Pond on Public Utilities, § 213, p. .262.

It is next contended by counsel for defendant that to allow plaintiffs to recover overcharges for gas furnished them would impair'the obligation of the contract entered into between each of the plaintiffs and the defendant for furnishing gas for use at their manufacturing plants.

"We cannot agree with counsel in this contention., It is true that the'Arkansas Natural Gas Company .made a ■ separate contract with the Norton Companypand with the American Bauxite Company to furnish- natural.-gas for use at the manufacturing plant of each company; but the Arkansas Natural Gas Company was operating as a public utility; and it was beyond its power to contract with respect to gas so far as such contract might interfere with the power of the Corporation Commission to regulate rates for gas furnished. Harrison Elec. Co. v. Citizens’ Ice & Storage Co., 149 Ark. 502, and Chambliss v. Clear Creek Oil & Gas Co., 161 Ark. 549.

It appears from the record that the Arkansas Natural Gas Company filed its schedule of rates with the Arkansas Corporation Commission, which was created by virtue of an act of the Legislature of 1919. In various other ways it also subjected itself to the control of the Arkansas Corporation Commission and exercised powers and privileges granted to public utility companies under the act creating the Corporation Commission. The act in question provided.for what is called indeterminate permits to certain public utilities. .Crawford & Moses’ Digest, 1653-1656 inclusive.

■The latter section in particular provides that any public utility operating under an existing license, permit, or franchise shall, upon filing with the Corporation Commission a written declaration that it surrenders such license, permit or franchise', receive, by operation of law, an indeterminate permit as provided by the act, and that such public utility shall hold such permit under all the terms, conditions and limitations of the act.

The section further provides that the filing of such declaration shall be deemed a waiver by such utility of the right to insist upon the fulfillment of any contract, entered into relating to any rate, charge or service regulated by the act.

By an act of the Legislature approved February 15, 1921, the Arkansas Corporation Commission was abolished, and the Arkansas Railroad Commission created in lieu thereof. General Acts' of 1921, p. 177.

Section 15 of this act provides, in effect, that contracts, franchises, and leases may be restored to utilities operating under indeterminate permits, upon application made by such public utility corporation in the manner provided in the act.

The section provides that the franchise and contracts of such corporation may.be reinstated upon proper application under the same conditions as existed at the time said indeterminate permit was granted by the Arkansas Corporation Commission. The act further provides that, unless the application for reinstatement of its franchise and contracts is made within the time and in the manner provided by the act, such right shall be deemed waived by such public utility.

No application was made for the reinstatement of contracts by the Arkansas Natural Gas Company. It is contended, however, that all existing contracts were expressly exempted from the operation of the act creating the Arkansas Railroad Commission and giving it power to fix and regulate the rates of public utilities, including those furnishing natural gas for domestic and industrial use,’ by the section of the act amending the act creatingthe Arkansas Railroad Commission, approved1 March 25, 1921. See General Acts of 1921, p. 429.

The purpose of this act was to transfer to the Arkansas Railroad Commission the records .under the control of the Arkansas Corporation Commission and to give it power to continue the hearings in regard to gas rates in certain cases, and to determine the same.

The section contains a proviso that the Arkansas Railroad Commission shall have no jurisdiction or power to modify or impair any existing contract for supplying gas to persons, firms, corporations, or municipalities or distributing companies, and that such contracts shall not be affected by the act, or the act of which it is an amendment.

It is contended that this section preserves to the Arkansas Natural Gas Company all existing contracts in force at the time of the passage of the act. We do not think so. The act simply means that the validity of any contract shall not be impaired, and does not intend to give such contract any validity or continuing force which it did not have at the time of the passage of the act. This is shown by-the concluding part of the proviso, to the effect that such contracts shall not be affected by this act or the act of which it is an amendment. As we have already seen, there can be no valid contract regulating rates as against the power of public control by the Corporation Commission. The public utility accepts the franchise and privileges granted it, subject to existing laws.

This is not a case like Pocahontas v. Central Power & Light Co., 152 Ark. 276, where, a municipal corporation was expressly authorized by the Legislature to grant a franchise to a public service corporation in order to procure it to enter the municipality, and to furnish electricity and gas to consumers upon terms and conditions accepted by the corporation.

Here the franchise and privileges granted to the Arkansas Natural Gas Company were not accepted by it upon any such terms, conditions or restrictions. It applied for and accepted a franchise subject to the existing laws of the State, and, upon its own motion, applied for and accepted what is called an indeterminate permit to surrender its franchise -and be released from its contracts, and did not, under the amended act, apply for a reinstatement of its franchise and contracts.

As we have already seen, it has a practical monopoly of the business of furnishing natural gas within the limits of the territory described in its franchise, and it is its duty to furnish all consumers with gas upon the same terms, with the proviso above stated,, that it may make a reasonable classification of its consumers. It ■ cannot, however, fix different prices and impose different terms upon its consumers, either domestic or industrial, according to its own will. It is bound to furnish gas at a reasonable rate to every consumer and without unjust discrimination, subject to tbe proper classification of its consumers as above indicated.

Tbe defendant, also seeks to reverse tbe decree against it in favor of tbe American Bauxite Company on tbe ground that the payments made by it were voluntary, and on that account cannot be recovered.

We do not think this contention is well taken. Some time between the middle of August and September, 1920, the purchasing agent of the American Bauxite Company first ascertained that his company was being charged a different rate from that charged other industries similarly situated. The defendant contended that it was entitled to receive the rate charged on account of the peculiar conditions relating to its service to the American Bauxite Company. It already had a written contract with the American Bauxite Company for furnishing gas to it. As we have already seen, notwithstanding this contract, the rates charged were subject to change appropriate to changed conditions relative to the service. At any event, in September, 1920, the defendant deemed that conditions had changed, and applied1 to the Arkansas Corporation Commission for the right to establish an increased rate to industrial consumers, including the American Bauxite Company.

It will be remembered that, at this time, the Arkansas Corporation Commission was authorized to establish rates for public utilities of this kind. When the matter was finally disposed of, the Arkansas Bailroad Commission had succeeded to the powers of the Arkansas Corporation Commission, and established the rates which are the basis of the recovery in these cases. .

The American Bauxite Company contested the right of the Arkansas Natural Gas Company to raise the rates, and, after some correspondence between the two corporations, the American Bauxite Company proposed to pay the increased rate under a protest incorporated in a clause of one of its letters to that effect to the defendant. In other words, the letter expressly made a tender of the increased rates asked by defendant, subject ' to the American Bauxite Company not waiving its right to recover whatever excess payment it might make over the rates finally established by the Corporation Commission. Tha defendant refused to deal with it on these terms, and continually threatened to shut off the supply of gas if the American Bauxite Company did not pay the increased rates without protest, and so stated in a letter to it. Under the threat of its service not being continued, the American. Bauxite Company finally made the payments demanded, and struck out from its letter, which was contractual in its nature, the clause to the effect that it was making the payments under protest.

The representatives of the American Bauxite Company claim that they did so because, if the gas supply of that company had been discontinued at that time, such action would have resulted in great and irreparable loss to the company. They stated in detail the conditions which would cause such a loss, but they need not be repeated here.

There is what is called moral duress, or business compulsion, which, when exercised, prevents overcharges, although not made under protest, from being voluntary payments, and therefore not recoverable.

As we have already seen, under modern business conditions, public utilities are a necessity, and have a practical monopoly in the fields occupied by them, respectively, in the business world. Their products must be accepted and used, not only for domestic convenience, but on account of business necessities. Take the case of supplying gas, for instance. The public service corporation furnishing it has the right, by purchase and by eminent domain proceedings, to secure a right-of-way over and across the lands of private individuals, the public roads, railroad right-of-way, and the streets of cities and towns. They also have a right to establish rates which are equivalent to the service performed by them. Thus they acquire a great advantage over their business rivals, and are thereby enabled to furnish gas to consumers at a much cheaper rate and1 under much more favorable conditions. The manufacturer needing and using gas in his business must purchase it from the public service corporation, or his business competitors, who have such service, will have a great advantage over him. If a manufacturer or other business enterprise cannot secure the service upon the same terms and under the same conditions as his rivals in business, he will suffer serious loss or damage to his business, and in some cases his business will be entirely destroyed. If the public service corporation is allowed to act in an arbitrary and discriminatory manner in performing its service to the public, it can, in all cases, seriously injure any of its customers, or destroy his business entirely. The prosperity of the business man using the product of the public service corporation would depend upon the favors shown him by that corporation, or upon the mere whim or caprice of its agents. In such cases the parties do hot stand on an equal footing. Delay or resort to law would be a matter of indifference to the public service corporation, but it might cause irreparable injury to the consumer. It is extortion to press the payment of illegal or unjust demands by such means. As a reasonable regulation, a public service corporation may cut off the supply of gas or other product furnished by it where its consumers fail or refuse to pay the proper charges. The public service corporation, however, has no power to establish excessive or unreasonable rates for its service, and to allow it to exercise the power of cutting off the supply of its product for the nonpayment of extortionate or excessive demands would be to give it the power to cripple business enterprises at will, and for no valid reason. Such action is generally held to be duress in law.

The rule is of universal application with reference to public carriers of freight, so far as we have ascertained. Hutchinson on Carriers, 3rd ed. §§ 521 and 1341; 30 Cyc. p. 1303; Mobile & Montgomery Ry. Co. v. Steiner, McGehee & Co., 61 Ala. 559; Chicago & Alton Rd. Co. v. Chicago, Vermillion and Washington Coal Co., 79 Ill. 121; Peters v. Railroad Co. (Ohio), 51 Am. St. Rep. 814; Clough v. Boston, etc., R. Co. (N. H.) Ann. Cas. 1915B, p. 1195; Lehigh Coal & Navigation Co. v. Brown, 100 Penn. St. 338; Louisville, Evansville & St. Louis Rd. Co. v. Wilson (Ind.), 18 L. R. A. 105; California Adjustment Co. v. Atchison, T. & S. F. Ry. Co. (Cal.), 175 Pac. 682; and Beckwith v. Frisbie & Sons, 32 Vt. 559.

The rule stated, for like reasons, applies to other public service corporations, and the tendency in the later decisions is to extend the doctrine in favor of those making payments of illegal charges or exactions under apprehension that their business will be stopped or seriously injured if the money is not paid. American Brewing Co. v. St. Louis (Mo.), 2 Ann. Cas. 821; Westlake & Button v. St. Louis, 77 Mo. 47; Indiana Natural & Illuminating Gas Co. v. Anthony (Ind.), 58 N. E. 869; Chicago v. Northwestern Mutual Life Ins. Co. (Ill.), 1 L. R. A. (N. S.) 770; St. Louis Brewing Assn. v. St. Louis (Mo.), 37 S. W. 525; and New Orleans & N. E. Rd. Co. v. Louisiana Construction & Imp. Co., (La.), 94 Am. St. Rep. 395, and case note.

Woodward on the Law of Quasi-Contracts, in § 220, says that, because common carriers and some other pub-lie service corporations usually enjoy an advantage of position not unlike that of public officers, illegal freights, tolls, or other charges exacted by such corporations may be recovered as money paid under compulsion.

In Keener on Quasi-Contracts, at page 437, it is said that money paid to one who, because of his position, is under an obligation to discharge certain duties to the public, but who refused to discharge such duties without the payment of a sum of money to which he is not entitled, can be recovered as money paid under, compulsion.

Upon the circumstances of this case we are of the opinion that the payments were not voluntary. They were made in order to induce the Arkansas Natural Gas ■Company to do that which it was bound to do without them. To protest would be an idle ceremony. The law looks to the substance of things, and does not require useless forms. The public service corporation and the consumer were in no sense on equal terms, and the money thus paid to obtain the necessary service was not voluntarily paid, as the law interprets that phrase.

The briefs are very voluminous, but there seems to be no contention about the amount of gas furnished or the amount due under the rates finally established by the Arkansas Railroad Commission. The main contention is the right of the consumers to recover the excess charges made by the public service corporation.

The decree in the chancery court was made in conformity with the principles of law announced above, and it is therefore affirmed.


author: Humphreys, J. Hart, J.

text:
    Dickinson v. Norman.
    Opinion delivered June 30, 1924.
    1. Quieting title — laches of plaintiff’s grantor.' — In an action to remove clouds upon title, plaintiff was estopped by the laches of his grantor, who waited six years and eight months before she probated a will in which the lands were devised to her, where in the meantime a person holding alleged forged deeds from the testator had recorded them and had sold the lands to innocent purchasers who paid valuable considerations and made valuable improvements.
    2. Equity — doctrine of laches. — While ordinarily the doctrine of laches will not be applied in cases of delay short of the period of limitation, courts of equity will not hesitate to apply the rule where supervening equities call for its application.
    Appeal from Union Chancery Court, First Division; J. Y. Stevens, Chancellor;
    affirmed.

      Mahony, Yocum & Sayo and Bose, Hemingway, Cantrell & Loughborough, for appellant.
    The finding of the chancellor was against the clear preponderance of the evidence. It is admissible to show that a grantor in a deed or mortgage never actually appeared 'before the officer purporting to have taken his acknowledgment, and that the grantor made no acknowledgment at all. 130 Ark. 413. When it is sought to show that the grantor did not acknowledge the deed at all, no rule as to the amount of evidence required obtains, but the court is to determine from all the circumstances disclosed whether the certificate is true or false. 103 Ark. 488; 130 Ark. 318; 116 Ark. 142; 117 Ark. 326. Where the evidence is so clear as to produce a moral certainty that the certificate is false, it will be held invalid. 1 C. J. 901. One purchasing land from a person who obtained title thereto by forgery is not a bona fide purchaser. 37 Ark. 195. Where a grantor has no title, the doctrine of bona fide purchaser does not apply. 217 Fed. 11; 222 Fed. 760. If a deed is void, a subsequent innocent purchaser is not protected. 5'2 So. 425.

      Pat McNalley, for appellee.
    Acts and declarations of a person in possession of a tract of land are admissible to show the character and extent of possession but not to contradict the title. 132 Ark. 227; 96 Ark. 589; 90 Ark. 149; 45 Ark. 472; 48 Ark. 169. The appellant was barred by his laches. “He who seeks equity must do equity.” 137 Ark. 600. Laches is not mere delay, but delay that works disadvantage to another. 5 Pomeroy Eq. Jur. (3 ed.), § 21; 114 Ark. 359; 103 Ark. 251; 81 Ark. 296; 101 Ark. 230; 16 Cyc. 162j 55 Ark. 85; 135 Ark. 206. The findings and decree of a chancellor are persuasive and will not be set aside on appeal, unless clearly against- the weight of the evidence. 136 Ark. 624; 129 Ark. 197.
   Humphreys, J.

Appellant brought this suit in the chancery court of Hnion County on May 14, 1921, against John C. Norman, W. A. Tuberville, Lee Davis, A. G. Shivers, S. J. Garner, and James Coleman, to cancel two deeds from Maria F. Norman to her husband, John C. Norman, one being dated February 12,1912, and the other December 19, 1913, conveying certain lands in said county, and also to cancel certain deeds from John C. Norman to each of the other appellees for certain parts of the lands described in the two deeds. It was sought to cancel and remove all of said deeds as clouds on appellant’s alleged title to said lands, upon the ground that the first two deeds were forgeries, and therefore passed no title to the lands to John C. Norman’s co-appellees. Appellant alleged that he was the owner of said lands under a deed of gift from Fannie R. Norman, to whom they were devised by Maria F. Norman.

Appellees filed answers to the bill, denying that the deeds dated Feb. 10, 1912, and December 19, 1913, were forged instruments, and interposing the further defense of limitations and laches.

The cause was submitted to the court upon the pleadings and testimony, which resulted in a decree dismissing appellant’s bill for the want of equity, from which is this appeal.

The record reveals that, many years before the execution of the first two deeds, John C. Norman had conveyed all his lands to his wife, Maria F. Norman, in an effort to save them from his creditors. John C. Norman testified that, after recovering from his financial distress, his wife voluntarily conveyed his lands back to him. All the lands involved in this litigation were embraced in the first two deeds, which were placed on record by John C. Norman a short time after their purported execution, and before the death of Maria F. Norman, which occurred on September 18, 1914. Either before or immediately after the death of Maria F. Norman, John C. Norman took actual possession of the lands in question, and paid the taxes on them until he sold them to his co-appellees. The dates of his conveyances of certain parts of the lands to his co-appellees are as follows: to S. J. Garner, January, 1915; to James Coleman, January 16,1915; to A. G. Shivers, July 17, 1915; to W. A. Tuberville, January 2, 1917; and to Lee and J. W. Davis, February 19, 1919. The respective purchasers aforesaid of the various parcels of the land entered immediately into the actual possession of the parcel he purchased, paid the taxes, and made valuable improvements thereon. After John C. Norman conveyed the lands he became insolvent, and was in that condition when this suit was instituted and tried.

On January 19, 1913, Maria F. Norman executed a will, in due form, by the terms of which she devised all her property wherever situated to Fannie R. Norman. The will was admitted to probate in Union County, Arkansas, February 15, 1921. On May 6, 1921, Fannie R. Norman conveyed to appellant all of , the property which had been bequeathed to her by Maria F. Norman, who immediately instituted this suit.

Appellant introduced testimony tending to show that the deeds of date February 10, 1912, and December 19, 1913, conveying the lands in question, were forged by John C. Norman.

Appellees introduced testimony tending to show otherwise.

We deem it unnecessary to set out and analyze this testimony, for a majority of the court have reached the conclusion that appellant is estopped from recovering these lands by the laches of his grantor, Fannie R. Norman. She waited for six years and eight months after the death of her testator before she probated the will in which the lands were devised to her. In the meantime John C. Norman, who had recorded the purported deeds from his wife in her lifetime, was permitted to occupy, pay taxes on, and sell the lands to his co-appellees for a valuable consideration, who, in turn, were permitted to pay the taxes and make valuable improvements upon the respective parcels owned by each. At the time of the institution of this suit John C. Norman was judgment proof, and none of the purchasers could have recovered the purchase money they paid him for the land. Ordinarily the doctrine of iaches will not be applied in a case short of the period of limitations fixed by the statute, but courts of chancery will not hesitate to apply the rule where supervening equities call for its application, as the particular circumstances in this case do. In the case of Tatum v. Arkansas Lumber Co., 103 Ark. 251, this court quoted with approval the following statement from Mr. Pomeroy relative to the true doctrine of.laches:

“Laches, in legal significance, is not mere delay, but delay "that works disadvantage to another. So long as parties are in the same condition, it matters little whether he presses a right promptly or slowly within limits allowed by law; but when, knowing his rights, he takes no step to enforce them until the condition of the other party has/ in good faith, become so changed that he cannot be restored, to his former state, if thé right be then enforced, delay becomes' inequitable, and operates as estoppel against the assertion of the right. The disadvantage may come from the loss of evidence, change of title, intervention of equities, and other causes; but when a court sees negligence on one side, and injury therefrom on the other, it is a ground for denial of relief.”

It again quoted and approved the doctrine in the case of Casey v. Trout, 114 Ark. 359, taking occasion to say that the doctrine quoted from Mr. Pomeroy had been defined in substantially the same language in the case of Earle Improvement Co. v. Chatfield, 81 Ark. 296. It is true that this court said in the case of Bird v. Jones, 37 Ark. 195, that one purchasing land from a person who obtained title thereto by forgery is not a bona fide purchaser, but the doctrine of innocent purchaser does not control the instant' case. The doctrine of laches rules it. The appellant is estopped to recover the lands, because his grantor delayed in asserting her title until it would have worked disadvantage and injury to the co-appellees of John C. Norman if permitted to do so. The equities of the co-appellees of John C. Norman supervene any right appellant now" has.

No error appearing, the judgment is affirmed.

DISSENTING OPINION.

Hart, J.

It is well settled in this State, as well as elsewhere, that mere delay or lapse of time, however short of the statutory period, is not of itself sufficient to constitute laches unless such delay has so prejudiced the other party, by loss of testimony or changed relations, that it would be unjust to permit him to exercise his right. If it appears that lapse of time has not, in fact, changed the conditions and relative positions of the parties, and that they are not materially impaired, and there are peculiar circumstances entitled to consideration as excusing the delay, the court will not deny the appropriate relief. Tatum v. Arkansas Lumber Co., 103 Ark. 251; Reeves v. Davidson, 129 Ark. 88; and Rowland v. Taylor, 134 Ark. 183.

It does not appear from the record that any witness has died since plaintiff’s cause of action accrued; nor has the transaction under consideration become obscure by lapse of time. So far as this record shows, it does not appear that any valuable or material improvements have been made upon the property in question. The rise in value of the lands is a purely accidental one, unconnected with any fault of the plaintiff or merit of the defendants. The plaintiff in this case has been guilty of no conduct and made no representations whatever that would induce the defendants to purchase the lands in question. He has done nothing but delay asserting his rights in the premises. On account of his relationship to John O. Norman and the latter’s necessities arising from old age and poverty, he permitted him to hold possession of the lands in question. His occupancy was permissive and did not give him any right to dispose of the lands. As we have just seen, the defendants were not induced to purchase the lands by any representations or conduct on the part of the plaintiff. Nothing has occurred since the purchase upon which they might predicate a defense to the recovery of the lands by reason of estoppel or of laches on the part of the plaintiff.

It does not seem to me that the insolvency of Norman and the date of the decree cuts any figure at all. He was insolvent throughout the whole period of time involved in these transactions. If the deeds were forgeries, they gave him no title whatever. If they were not forged, Norman had the title to the lands, and the question of laches would not arise.

Having reached this conclusion, it becomes necessary for me to express my views on the question of whether the deeds under which the defendants deraign title are forgeries. I think the proof shows that the deeds were forgeries within the rule announced in Miles v. Jerry, 158 Ark. 314, and cases cited.

It follows that I respectfully dissent from the majority opinion.


author: Humphreys, J.

text:
    Haglin v. Oakley.
    Opinion delivered June 30, 1924.
    Landlord and tenant — watver of rents. — Where a room and hall were leased separately from the main part of a hotel of which they were a part, and both leases were ■ acquired by the appellee, the fact that the landlord accepted rent under the lease for the hotel proper, without demanding rent from the segregated portion of the building, did not waive his right to collect the rents on the latter.
    Appeal from Sebastian Circuit Court, Fort Smith District; John E. Tatum, Judge;
    reversed.

      Hill & Fitshugh, for appellant.
    The court erred in not rendering a judgment for the plaintiff. A waiver, to be binding, must either operate by way of estoppel or be supported by a valuable consideration. 72 Ark. 525. 27 E. C. L. 910; 40 Cyc. 267.

      Cravens & Cravens, for appellee.
    Every one is required to take advantage of his rights at the proper time, and a neglect to do so will be considered a waiver. 83 Fed. 684; 37 N. E. 540. A waiver takes place where a man dispenses with the performance of something which he has a right to exact. 36 Pac. 434.
   Humphreys, J.

This is a suit by appellant against appellee for rent upon a large room in the rear end of the Haglin Hotel in Fort Smith and a hall or tunnel leading from Garrison Avenue, the main street in Fort Smith, back to said room, from November 18, 1920, until March 23, 1922, at the rate of $75 per month. This particular part of the hotel was not included in the original lease for the hotel proper, but was covered by a separate lease, which expired on November 18, 1920, with the privilege of renewal. On September 3, 1918, appellant leased the main part of the hotel, which had another entrance or rotunda from Garrison Avenue, to Messrs. Shipley and Sossman. Shipley bought out Sossman, and, on November 18, 1919, leased the tunnel and back room from appellant for $75 per month. On January 19,1920, appellee bought out Shipley, and assumed both leases under written contract with Shipley and appellant, to the effect that he might relinquish the tunnel and said room on November 18, 1920, and be released from the rental thereon after that date, with the privilege to appellant, in case.he released said tunnel and room, to rent them out for a confectionery store, barber shop, or a real estate office. Appellee paid the rent on the tunnel and room until November 18, 1920.

The only issue presented by the pleadings and testimony was whether appellee surrendered the possession of the tunnel and room on November 18,1920, to appellant, or whether he held over by usipg them himself, or prevented appellant from renting them to other parties.

Appellant introduced testimony tending to show that appellee used the tunnel and room between the dates of November 18, 1920, and March 23, 1922, just as he had done before, and that he refused to pay rent or allow appellant to rent them to others when requested to do so.

Appellee introduced testimony tending to show that he surrendered this particular part of the hotel to appellant on November 18, 1920, and did not use or prevent appellant from renting same after that time, and that appellant made no demand for rent thereon after same was surrendered to him. ■ ;

In submitting the issue the court gave the following erroneous and misleading instruction to the jury, over the objection and exception of appellant:

“If you find that the plaintiff, Edward Haglin, leased to the defendant, S. Oakley, or allowed to be sub-: let to him, the property known as the Haglin Hotel building, in the city of Fort Smith, in which is located the hallway and room in the- rear thereof for which rent is sought to be recovered, and that said S. Oakley continued to occupy said property until March, 1922, and that the plaintiff, Edward Haglin, accepted and received from said S. Oakley rent on the other part of the Haglin Hotel building, not including the hallway and room in controversy, and, in so receiving the rent for the. other part of said building, did not claim or demand from the defend: ant, S. Oakley, any rent on the hallway or room in the rear thereof, then you are instructed that said plaintiff, Edward Haglin, by such conduct, waived his right, if he had any, to collect rent from the defendant, S. Oakley, for said hallway' and room in the rear thereof, and, in this event, your verdict should be for the defendant.”

The leases were separate and independent Of each other, so the collection of the rent under one of them, without demanding the rent under-the other, would not of itself waive the right to collect the rent under the other. It was error to tell the jury that, if appellant accepted' rent under the lease for the hotel proper without demanding rent on the room and tunnel, he would thereby waive his right to collect rents on them.

The judgment-is therefore reversed, and the cause remanded for a new trial.