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(134 Ark. 197)
unless an affidavit were filed that the party WILLARD V. WILLARD. (No. 381.) so sued was in fact a nonresident. This (Supreme Court of Arkansas. May 20, 1918.) statute had been construed as requiring an
) PROCESSO. 47 AFFIDAVIT FOR WARNING affirmative, positive recital of nonresidence. ORDER.
It could not have been made upon informaUnder Kirby's Dig. & 6055, as amended by tion or belief, however trustworthy such inActs 1915, p. 1084, § 4, as to affidavit for warning order an affidavit unequivocally stating that formation may have appeared to be. But defendant is a nonresident, “his post office ad- the act in question has made it possible to dress being" a named place in another state, is secure such service where one has made sufficient, and it is unnecessary to allege dili: diligent inquiry which results in the inforgent inquiry, information, and belief; the act not being intended to deprive affiant of the mation and belief that the defendant is a nonright to make an affidavit based on actual resident of the state, and where an affidaknowledge.
vit to that effect is made, it is now possible Appeal from Marion Chancery Court; to procure the issuance of a warning order; Ben F. McMahan, Chancellor.
whereas before the passage of the act it Action by Bessie Willard against Elige would have been possible to do so in the Willard. From a judgment for defendant, event only of a positive and affirmative alplaintiff appeals. Reversed and remanded. legation that the defendant was a nonresi
J. C. Floyd and Williams & Seawel, all dent. In the case of Bauer v. Brown, 129 of Yellville, for appellant. J. H. Black, of Ark. 129, 194 S. W. 1026, it was said: Yellville, for appellee.
"The purpose of amending section 6055 of Kirby's Digest was to require plaintiffs, before
making an affidavit as to the nonresidence of SMITH, J. Appellant, who was the plain the defendant, to make a diligent inquiry to tiff below, alleged in her complaint the ex- such an extent that he can say upon informaistence of statutory grounds for a divorce. dent of the state. Section 6055 of Kirby's Di
tion and belief that the defendant is a nonresiThe complaint also alleged that:
gest did not require a diligent inquiry as to the “Defendant is now a nonresident of the state whereabouts of the defendant, and the pracof Arkansas, his post office address being West tice grew up of swearing to the affidavit more Plains, Missouri.
as a matter of form than as a matter of fact. There was an affidavit for a warning or- not make an affidavit that will support a warn
Under the amendment to that section, one cander, in which it was stated that the defending order until he has first made a diligent inant was a nonresident of the state of Ar- quiry as to the whereabouts of the defendant. kansas. A motion to quash the warning It is contended that Fred Brown is an honest
A motion to quash the warning negro and acted upon the advice of white order and proof of publication was filed friends in procuring service in his divorce suit. which for cause stated :
This can avail him nothing. That statutes “That the affidavit of the plaintiff upon which providing for constructive service must be comthe warning order is based is insufficient, in plied with, is conceded by learned counsel for that it states that the defendant is a nonresi- appellants. This court is of opinion that the
. dent of the state, when, under the new Practice requirements of such statutes cannot be avoidAct of March 30, 1915, the statute specifies ed through the advice of others. A plaintiff that the plaintiff shall state in his affidavit that can no longer guess as to the whereabouts of he has made diligent inquiry, and from the best the defendant and procure a warning order upof his information and belief the defendant is on the formal affidavit based on the guess. a nonresident of the state."
Before making the affidavit he must make dili
gent inquiry as to the whereabouts of the deThe court declared the law to be that the fendant and must gain information upon which affidavit for the warning order did not sub- he can base an honest belief that the defendstantially conform to the requirements of ant is a nonresident. Anything less than this section 4 of Act No. 290 of the Acts of the will amount to a fraud in procuring the judgsection 4 of Act No. 290 of the Acts of the ment, unless it develops that the defendant General Assembly of 1915 (Acts 1915, p. was at the time a nonresident of the state." 1081), and dismissed the complaint, when plaintiff elected to stand upon the affidavit considered in connection with the facts there
But the language of that opinion must be made. This act amends section 6055 of Kir- recited. That was a proceeding to set aside by's Digest to read as follows:
"Where it appears by the affidavit of the a decree of divorce upon the ground that plaintiff, filed in the clerk's office at or after fraud had been practiced upon the court in the commencement of the action, that he had procuring the decree for divorce. Service made diligent inquiry, and that it is his infor- had been had by the publication of a warning mation and belief that the defendant is
order the issuance of which was procured by nonresident of
an affidavit in which affiant recited “that he or, where either of the last had made inquiry and to the best of his intwo mentioned facts is stated in the return by formation appellee (the defendant) was a nonthe proper officer of a summons against the defendant, the clerk shall make and file with resident of the state.” The testimony showed the papers in the case, an order warning such that affiant had not made diligent inquiry to defendant to appear in the action within thirty ascertain the whereabouts of the defendant, days from the time of making the order."
and that the statement to that effect was Prior to the passage of this act one could false, and it was further shown that the denot procure the issuance of a warning order fendant was not a nonresident of the state of as substituted service against a nonresident | Arkansas. The trial court held that a fraud
Fun For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
had been practiced upon it in procuring the , affidavit must recite the truth so far as the decree and vacated it, and that action was af- truth is known; and, if the affiant does not firmed by this court. The point there decid- know the facts, he must make diligent effort ed was that a fraud had in fact been practic- to ascertain them, and he cannot then make ed upon the trial court, for the reason that it unless this effort results in the acquisition the affidavit made to procure the issuance of of information which leads to an honest bethe warning order was in fact false, in that lief in the truth of the facts stated in the afdiligent inquiry had not been made to ascer- fidavit. But if the affiant possesses positive, tain the whereabouts of the defendant. definite, and certain information of the truth
Many states appear to have provisions in of the matter alleged, it would be a work of their statutes more or less similar to the act supererogation to require him to make inof 1915, supra, and the courts of those states, quiry about a fact already known, and we in construing them, appear to have generally think the act set out above was not intended held that an affidavit for a warning order is to deprive the affiant of the right to make an insufficient which does not recite the facts al affidavit the truth of which rests upon his own leged to constitute diligence in ascertaining knowledge. He need not inquire to ascertain the whereabouts of the defendant. Those the truth of a fact which he already knows, cases say the affiant cannot, by his affidavit, and, so far from it being any part of the legdecide whether he has exercised diligence, islative intent to deprive an affiant of the and that it does not suffice that he state the right to make an affidavit based upon actual ultimate fact that he has exercised diligence, knowledge, which he possesses, we think the but that the affidavit must state the proba- Legislature intended to permit this affidavit tive facts showing the diligence used rather to be made even though he did not possess perthan the ultimate fact that diligence has been sonal knowledge upon the subject, provided, used. See note to the case of Grigsby v. Wop- as the act states, he shall have first made dilschall, 37 L. R. A. (N. S.) 210. But that is not igent inquiry which has led to the acquisithe point here involved. The suit in the in- tion of information upon which he bases an stant case is not brought against one whose honest belief in the fact recited. Prior to whereabouts are unknown and there was no this act of 1915 an affidavit based upon diliattempt to procure the issuance of a warning gent inquiry, information, and belief was not order upon the ground that after diligent in- sufficient. It was essential that the affidavit quiry had been made the affiant has obtained for a warning order should affirmatively reinformation and honestly believes that the cite that the defendant was a nonresident of defendant was a nonresident of the state; and the state. The act liberalizes the law in this we need not, therefore, here decide whether respect, and makes it possible to secure servunder a case presenting those facts we would ice on warning orders based upon affidavits construe our statute as similar statutes have made upon diligent inquiry, information, and been construed in other states.
belief as to the residence of the defendant. It will be observed that in the case of Bauer But, as stated in Bauer v. Brown, supra, it v. Brown, supra, the defendant was not in does not permit the affiant to hazard a guess fact a nonresident of the state, and we there does not permit the affiant to hazard a guess
or to make the affidavit at all, in the absence said that the affiant had no right to make an of personal knowledge, without having made affidavit as a matter of form rather than as the diligent inquiry required by the statute. a matter of fact, and that he could not guess
It is not contended here that any fraud as to the whereabouts of the defendant and procure a warning order upon a formal affi- court below, as it is not denied that the de
was being practiced or attempted upon the davit based on the guess. And so say we
We here. It would be a fraud upon the court fendant resided in West Plains, Mo. here, as it was there, for an affiant to make a think the affidavit is sufficient, as it unequivfalse affidavit to procure the issuance of a ocally states the fact to be that the defendwarning order; but it would be no more a ant is a nonresident of the state. fraud to allege that he had made diligent in
We conclude, therefore, that the court erred quiry when he had not done so than it would in quashing the affidavit, and the judgment be to allege that the defendant was a non- will therefore be reversed, and the cause reresident when such was not the case. The manded for further proceedings.
(134 Ark. 351)
pellee to believe that the claim would be paid BAKER-MATTHEWS MFG. CO. V. GRAY- without any necessity for a suit, and thereLING LUMBER CO. (No. 1.)
by induced appellee to refrain from com(Supreme Court of Arkansas. May 27, 1918.) mencing an action until the bar of the stat
. 1. LIMITATION or ACTIONS O13--PLEADING ute of limitations had attached. -ESTOPPEL.
The jurisdiction of the court of equity was Where defendant, in negotiations with plain- invoked on the ground that there was no adetiff looking to settlement of claim, wrongfully induced plaintiff to believe that 'an amicable quate remedy at law to escape the statute adjustment of the claim would be made without bar. There was a demurrer to the complaint, suit, and so induced plaintiff to refrain from which the court overruled, and appellant alinstituting action in time to prevent the statu- so filed a motion to transfer the cause to the tory bar from attaching, defendant was estopped from setting up as a defense the statute of circuit court, which motion was overruled. limitations.
Appellant filed an answer denying that ap2. CORPORATIONS O 445-SALES OF PROPERTY pellee was the owner of the tract of land on -CHOSES IN ACTION-RIGHT TO SUE..
which the timber stood, and denying that Where one corporation on dissolution, being ignorant of a trespass entitling it to damages, appellant cut the timber, or authorized its sold all its property and rights connected with agents to do so. The answer also contained land to another corporation, the purchasing a plea of the statute of limitations. . The corporation could sue to recover damages for cause was heard upon the depositions of the the trespass, although it did not own the proper- witnesses, and the court found in favor of ty at the time of the trespass. 3. ASSIGNMENTS O120_EQUITABLE ASSIGN- appellee for recovery of the sum of $1,833, MENTS—RIGHTS OF ASSIGNEE.
and rendered a decree accordingly. An equitable assignee can sue at law in the The facts of the case, according to the tesname of the assignor, and that remedy is such timony adduced, are as follows: The tract an adequate one that a court of equity will not assume jurisdiction merely because the assignee of land on which the timber is said to have does not hold the legal title.
been cut by appellant was originally the 4. ASSIGNMENTS Eww120_EQUITABLE ASSIGN- property of Desna Land & Timber ComMENTS-RI TS OF ASSIGNEE.
Where corporation on dissolution assigned pany, a foreign corporation, and in Februall its rights to certain land to another corpo- ary, 1911, negotiations were commenced beration, the purchasing corporation could not tween that corporation and appellee for the after dissolution maintain suit in the name of sale of that tract and other tracts of land the selling corporation and had no remedy at law, so that it could maintain suit in equity to in the same locality. The negotiations berecover damages for a trespass committed before tween the two corporations resulted in an the sale.
agreement for the sale of all the lands of 5. LIMITATION OF ACTIONS O165 - BAR OF the Desha Land & Timber Company in that ACTION-EQUITY SUIT-REMEDY AT LAW.
Suit in equity to recover damages for a tres locality to appellee prior to July of that pass cannot be maintained merely on the ground year, but the deed was not executed until that defendant prevented the institution of the September 8, 1911, when the Desha Land & action until after the bar of the statute of lim- Timber Company executed a deed of conveyitations attached, since estoppel thereby arising ance to appellee conveying this tract and all could have been pleaded in an action at law.
other tracts in that locality owned by the Appeal from Desha Chancery Court; Z. T. first-named corporation. Shortly thereafter Wood, Chancellor.
Desha Land & Timber Company surrenderAction by the Grayling Lumber Company ed its charter in the state of its domicile against the Baker-Matthews Manufacturing and ceased to do business. During the negoCompany. Judgment for plaintiff, and de- tiations the quantity, quality, and value of fendant appeals. Affirmed.
timber on the land was carefully estimated E. E. Hopson, of Arkansas City, and J. W. by employés of appellee in order to appraise & J. W. House, Jr., of Little Rock, for ap- the market value of the land, which was pellant. Jack Bernhardt, of Arkansas City, chiefly valuable on account of the timber, and Samuel Frauenthal, of Little Rock, for and the estimates thus made formed the appellee.
basis of the purchase price agreed on by ap
pellee with Desha Land & Timber Company. McCULLOCH, C. J. Appellee instituted When the sale was consummated by the this action against appellant in the chancery execution of the deed neither of the parties court of Desha county to recover the value was aware of the fact that large quantities of timber alleged to have been cut by appel- of the timber had, in the meantime, been relant on a certain tract of land in that county. moved by trespassers. The timber was cut
It is alleged in the complaint that the tres- by appellant's employés in the latter part of pass was committed in July, 1911, but that) June and the early part of July, 1911. The appellee did not become aware of it until proof adduced by appellee shows that the March 22, 1913, and that thereupon appellee timber taken from the land amounted to entered into correspondence with appellant 533,250 feet, and was of a market value of looking to a settlement of the claim, and $6 per 1,000 feet, making a total valuation of that appellant by its written statements con- $3,199.50, the amount claimed by appellee in cerning the settlement led the agents of ap- this action. The proof adduced by appel
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lant tended to show that only about 200,-, the evidence shows that the Desha Land & 000 feet of timber was cut, and that it was Timber Company, in anticipation of the surof very poor quality, not worth more than render of its charter rights, sold out and $2.50 per thousand. It is not contended transferred to appellee all of its rights here that the preponderance of the evidence is concerning the lands owned by that company, against the finding of the chancellor as to the and that appellee became the successor of amount of recovery.
the other corporation, and succeeded to the It is insisted, however, that the plaintiff rights of the other corporation concerning is not entitled to recover for the trespass the property here. The debts of the old corfor the reason that it was not the owner of poration were presumably paid in full; there the lands and timber at the time the trespass being no showing in this case to the contrary, was committed, that the claim was barred by and the assets passed to the stockholders. the statute of limitations before the com- Those stockholders received stock in appellee mencement of the action, and also that the corporation in payment of the consideration action was improperly brought in the chan- for the sale of the timber lands, and the uncery court, and that the court erred in refus. disputed testimony shows that they intended ing to transfer the cause to the law court to pass to appellee all of the rights of the for trial.
old corporation and its stockholders. Such  The evidence is sufficient to justify the was the necessary effect of the transaction. finding that appellant, in its negotiations 2 Cook on Corporations, 8 641. with appellee looking to a settlement of the  That being true, appellee had the right claim, wrongfully induced the agents of ap- to maintain an action for the enforcement of pellee to believe that an amicable adjustment those rights, even though the sale was conof the claim would be made without suit, summated subsequent to the trespass. The and that appellee was thereby induced to re. Desha Land & Timber Company surrendered frain from instituting an action in time to its charter and passed out of existence beprevent the statute bar from attaching. It fore the commencement of this suit, and for is a well-recognized principle in the law that that reason could not be joined as a party a debtor may be estopped by his own con- to the action. But the deed of conveyance, duct from setting up as a defense the statute which was the only written evidence of the of limitations, and this rule has often been transaction, did not purport to convey the applied where the debtor hås misled the credi- right of action against the trespassers, and tor and induced him to refrain from bringing there is therefore no written evidence of the an action within the statutory period. The transfer so as to constitute a transfer of rule is correctly stated in 17 R. C. L. p. 884, the legal title to the cause of action. Only as follows:
the equitable title was transferred, which did “A debtor has frequently been held to be es- not carry with it the right to maintain an actopped from relying on the statute as a defense tion at law in the name of the assignee. Wilwhere, by acts of a fraudulent character, he has misled the creditor and induced him to son v. Bowden, 26 Ark. 151. An equitable asrefrain from bringing suit within the statutory signee can, however, sue at law in the name period. And if a defendant intentionally or of the assignor, and that remedy is such an negligently misleads a plaintiff by his misrep- adequate one that a court of equity will not resentations, and causes him to delay suing until the statutory bar has fallen, the defendant assume jurisdiction merely because the aswill be estopped from pleading the statute of signee does not hold the legal title. 3 Pomlimitations. And the prevailing view seems to eroy's Equity Jurisprudence, $ 1271; Haybe that the doctrine of estoppel applies where the creditor, before the debt is barred, is lulled ward v. Andrews, 106 U. S. 672, 1 Sup. Ct. into security by the oral promises of the debt- 544, 27 L. Ed. 271; New York Guaranty Co. or that he will not avail himself of the statute of limitations, and suit is delayed by rea
v. Memphis Water Co., 107 U. S. 205, 2 Sup. son thereof. It is not necessary that the debt-Ct. 279, 27 L. Ed. 484; Hayes v. Hayes, 45 or should intend to mislead, but, if his decla- N. J. Eq. 461, 17 Atl. 634; Hayes v. Berdan, rations are such as are calculated to mislead 47 N. J. Eq. 567, 21 Atl. 339. This doctrine, the creditor, who acts upon them in good faith, with its limitations, is clearly stated by the an estoppel will be created."
Supreme Court of the United States in HayMany cases are cited in support of the ward v. Andrews, supra, as follows: above text.  The undisputed testimony establishes unable to assert in a court of law the legal
"If the assignee of the chose in action is the fact that, though the sale by the Desha right of the assignor, which in equity is vested Land & Timber Company to appellee was not in him, then the jurisdiction of a court of chanconsummated until after the trespass was forum for the enforcement of equitable intercommitted by appellant and the timber re- ests, and because there is no adequate rememoved, the effect of the sale as consummat- dy at law; but when, on the other hand, the ed was to transfer to appellee all of the equitable title is not involved in the litigation, rights of the other corporation here in Ar-pose of enforcing the legal right of his assign
and the remedy is sought merely for the purkansas connected with the land as it stood at or, there is no ground for an appeal to equity, the time the negotiations were begun, and because by an action at law in the name of the that such was the intention of the parties vindicated, and the wrong done by the denial
assignor the disputed right may be perfectly
In the later case cited above the same, and the court erred in directing a verdict of court said:
guilty. “We have lately decided, after full consideration of the authorities, that an assignee of a J. M. Jackson, Judge.
Appeal from Circuit Court, White County; chose in action on which a complete and adequate remedy exists at law cannot, merely be
Harry Burton was convicted of violating cause his interest is an equitable one, bring a Acts 1917, p. 41, as to shipment of intoxicatsuit in equity for the recovery of the demand. ing liquors, etc., and appeals. Reversed and
He must bring an action at law in the name of the assignor to his own use. This remanded. is true of all legal demands standing in the name of a trustee, and held for the benefit of lant. Jno. D. Arbuckle, Atty. Gen., and T.
Brundidge & Neelly, of Searcy, for appelcestuis que trust.'
W. Campbell, Asst. Atty. Gen., for the State. The subject was very thoroughly discussed by Judge Gray in delivering the opinion of
HUMPHREYS, J. On the 15th day of the Supreme Judicial Court of Massachusetts October, 1917, information was filed by the in the case of Walker v. Brooks, 125 Mass. deputy prosecuting attorney of White coun241, where the following rule was stated, ty in a magistrate's court against appellant, which, we think, sustains the jurisdiction of charging him with shipping and bringing althe court of equity in the case now before us: coholic liquors into White county, Ark., on
"But a court of equity will not entertain a bill by the assignee of a strictly legal right, or about the 11th day of October, 1917. On merely upon the ground that he cannot bring the same date and at the same time, in the an action at law in his own name, nor unless it same court, the deputy prosecuting attorney vents such an action from being brought in his filed information against appellant, charging name, or that an action so brought would not him with unlawfully bringing and causing to afford the assignee an adequate remedy.” be brought alcoholic liquors into the state of
[4, 5] The facts of the present case are Arkansas, on or about the 11th day of Octhat the assignor of appellee's equitable title, tober, 1917. Appellant pleaded not guilty to the Desha Land & Timber Company, had no each charge, and at his request the causes legal existence, and therefore a suit could were tried together. Appellant was convictnot be maintained in its name. Its charter ed on both charges, from which judgment of was, as before stated, surrendered, and it conviction he appealed to the circuit court. passed out of legal existence, and that oc- It appears that the causes were tried as a curred before either that corporation or ap- consolidated case in the circuit court before pellee was aware of the right of action for a jury upon the affidavits filed in the magthe trespass committed by appellant. There istrate's court and the testimony of witness, was therefore no legal remedy at law for the es.
At the conclusion of the evidence, the enforcement of the right acquired by appellee court instructed the jury to find the defendat the time the discovery of the right of ac- ant guilty, and, in response to the court's tion was first made, and a court of equity is peremptory instruction, the jury returned the only forum open to appellee for the en
the following verdict: forcement of the right. Upon that ground
"We, the jury, find the defendant guilty as alone we sustain the jurisdiction of the charged and place the fine of ($400) four
hundred dollars. I. R. Pence, Foreman,” chancery court in this case. It could not be sustained on the ground merely that appel
A judgment was rendered against the aplant prevented the institution of the action pellant in accordance with the verdict, from until after the bar of the statute of limita- which verdict and judgment an appeal has tions had attached; for the estoppel which been prosecuted to this court. arose from that account could have been
Appellant is charged with a violation of pleaded in an action at law. Chase v. Car- the liquor laws under Act 13, Acts 1917, of
The ney, 60 Ark. 491, 31 S. W. 43; Bailey v. Glov- the General Assembly of Arkansas. er, 21 Wall. 342, 22 L. Ed. 636; Rosenthal v. punishment imposed for a violation under Walker, 111 U. S. 185, 4 Sup. Ct. 382, 28 L. said act is found in section 19 thereof, which .
, Ed. 395.
is as follows: It follows, therefore, from what we have lating any
of the provisions of this Act, except
"That any person, firm or corporation viosaid, that the decree of the chancellor was otherwise expressly provided herein, shall upcorrect, and the same is affirmed.
on conviction be fined not less than one hundred dollars, and not more than one thousand dol
lars, for each offense, and may be confined not (135 Ark. 164)
less than thirty days nor more than ninety
days, in the county jail." BURTON v. STATE. (No. 14.)
It is insisted by appellant and conceded by (Supreme Court of Arkansas. May 27, 1918.) the Attorney General that the trial court CRIMINAL LAW Om753(3) DIRECTION OF erred in directing a verdict of guilty for the VERDICT.
reason that the trial court is without power In a prosecution under Acts 1917, p. 41, as to peremptorily instruct a verdict of guilty to unlawful shipping of liquor, etc., the punishment imposed by section 19 of said act, being where the crime charged is punishable by fine or imprisonment or both, is for the jury, ) fine or imprisonment, or by both. The in
em For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes