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It follows, therefore, that all the lands in sections 1 and 3 should bear all the necessary and legitimate preliminary expenses of those sections, and these preliminary expenses should be borne in the same proportion as the cost of the proposed improvements would have been borne, and the court should not have ordered the return of the taxes paid by the landowners.

The decree of the court below is therefore reversed and the cause remanded, with directions to enter a decree in accordance with this opinion.

On Rehearing.

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Where contract required buyers to accept all apples on the ground after a certain date parol testimony was admissible to prove that it was seller's duty to take away the fallen apples on such date, such testimony being admissible, not for purpose of varying the terms or adding to terms of contract, but for the purpose of showing that it was essential to a compliance Appellees have filed a petition for rehear-therewith, that the fallen apples be cleared away ing and for modification of the opinion. It from the trees on such date so as to determine is first insisted that the levy of any tax in what buyers were required to accept. sections 1 and 3 was premature, and therefore unauthorized. This question was considered on the original submission, and we adhere to the view that sections 1 and 3 had the authority to collect a sufficient tax to pay the preliminary expenses incurred by those sections.

2. Appeal and error 1048 (6)-Cross-examination as to reasons for party's action held harmless.

In buyers' action to recover balance of deposit held by seller in reserve to apply upon final settlement, defended on the ground that buyers broke the contract by refusal to pay for We are also asked to modify the opinion, the last carload delivered, to seller's damage, on so as to relieve the property owners in sec- the ground that amount held in reserve was tions 1 and 3 from any liability except their more than sufficient to pay for that car and proportional part of the preliminary expens-cross-examination as to why seller was unwillthe remainder of the goods to be delivered, es. The

The insistence is that the act of 1919 divided the territory of district No. 2 into five sections, and that the preliminary expenses were incurred in the name of, and for the benefit of, all these five sections or districts, and that these expenses should be apportioned among all these districts, and it is asserted that the effect of the opinion herein is to hold sections 1 and 3 liable for expenses which inured to the benefit of all five sections. No such result was intended by us. We do not undertake to say what items are properly chargeable as preliminary expenses against any of these sections, as that feature of the case was not fully developed or passed upon by the court below. Nor have we undertaken to apportion these expenses.

sum in addition to amount previously deposited ing to accept buyers' offer to deposit a certain at the time of delivery of last carload held harmless, where it was the court's view that the written contract between the parties governed. 3. Sales174-Sale to third person at less than contract price on buyer's refusal to pay not authorized where contract price of balance of goods not greatly in excess of deposit of buyer.

Where contract price of remainder of goods to be delivered amounted to a comparatively small sum in excess of the balance of deposit held by seller in reserve to apply upon final setfor the carload on the ground that amount so tlement, the seller, on buyer's refusal to pay held in reserve was sufficient to pay for such carload and for remainder of goods to be delivered under the contract, could not sell goods to third persons at a price less than the contract price, but was required to deliver to the buyer and credit price thereof on the balance of deposit held in reserve.

It is said there are certain general expenses which inured to the benefit of all five sections of district No. 2, and that certain other expenses were incurred for the separate benefit of particular sections of district No. 2. Of course, those expenses which 4. Appeal and error 1064(1)-Instruction as

were for the common benefit of all five sections of district No. 2 should be borne by all of them, and should be paid, just as the cost of the improvement would have been paid, had it been constructed as is provided in section 20 of the act. Special expenses for the special benefit of particular sections should be borne and paid by that section, just as the cost of the improvement local to that section would have been paid, had it

been constructed.

These equities must be worked out on the remand of the cause.

to buyers' breach of contract held harmless.

In buyers' action to recover a balance of deposit held by seller in reserve, defended on ground that buyers broke the contract by refusal to pay for the last carload delivered, instruction that buyers did not break contract so as to justify seller in treating it as rescinded by refusal to pay for such carload if it, acting in good faith, believed that amount on deposit ered under the contract was sufficient to do so, to pay for carload and other goods to be delivheld harmless, where the contract price of remainder of goods amounted to only comparatively small sum in excess of the balance held

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

(232 S.W.)

by seller in reserve, requiring seller to deliver parties at a price which he claims resulted goods to buyers and credit price on amount of in a loss to him. deposit instead of selling to third persons at a price less than the contract price.

Appellees instituted this action against appellant to recover the sum of $608.60, alleged to be due on the balance of the sum of

Appeal from Circuit Court, Benton County; $1,500 advanced, after crediting the price of W. A. Dickson, Judge.

Action by W. E. Adams and others against J. N. Jordan. Judgment for plaintiffs, and defendant appeals. Affirmed.

Rice & Rice, of Bentonville, for appellant.

McCULLOCH, C. J. Appellant and appellees entered into a written contract on August 7, 1919, for the sale and delivery by appellant to appellees of all apples grown on certain farms in Benton county during the year 1919, at the price of $2.50 per hundredweight. The contract specified that appellees were to take, at the price mentioned, all of the apples "except what is called rots and knots, a knot being defined as an apple so badly misshapen as to be unmerchantable." The contract also contained the following provision:

"Purchaser also agrees to take all apples on the ground after September 15th that are not knots and rots, except that for Jonathan date to be August 22, and Peerless September 1st."

The stipulation in the contract with reference to mode of payment and delivery reads as follows:

"$1,500.00 to be paid upon the signing of the contract, this amount to be held in reserve to apply upon final settlement. Payment for all fruit shall be due when delivered to the said Lowell Fruit Company, f. o. b. cars at Centerton, Ark.

"The said J. N. Jordan agrees to place the fruit on the screen and stand expense of removing rots and knots, also stand the expense of delivering the fruit to Centerton, Ark., to the car or the evaporator, whether in package or in bulk."

The parties proceeded under the contract until most of the fruit from the orchards mentioned had been delivered, the last delivery being a carload on November 5, 1919, the price of which amounted to $712.75, and a controversy arose between the parties after this carload had been hauled away from the place of delivery by the railroad company as to whether or not appellees should pay this amount to plaintiff or charge it against him on the amount advanced as a reserve on final settlement. Appellant insisted on payment of the amount, and appellees refused to pay the money, claiming that the amount due on that car and the price for the remainder of the apples would not be sufficient to exhaust the sum of $1,500 which had been advanced. Appellant then refused to deliver any more apples under the contract and gave appellees written notice to that effect. He sold the remainder of the apples to other

the last carload of apples delivered, and also after crediting a certain amount paid into court by appellant after the commencement of the suit, leaving a balance of $608.60. Appellant answered, alleging that appellees broke the contract by refusing to pay for the last car delivered and asked for damages for loss on the remainder of the apples, and he also included in his counterclaim certain items of charges against appellees for improper culling of apples, making the total of his counterclaim $608.60, the precise amount claimed by appellees. It will be observed from the foregoing recitals that this action is to recover the balance of the money advanced as a guaranty under the contract after crediting the last shipment of apples and the counterclaim represents items for damages claimed against appellees for alleged breach of the contract in refusing to accept apples. The issues were submitted to the jury, and there was a verdict in favor of appellees for the sum claimed, $608.60, and appellant has prosecuted his appeal.

[1] There were numerous assignments of error in the motion for new trial, but we will only discuss those which are argued in the brief. In the first place, it is argued that the court erred in permitting witnesses to testify concerning the duty of appellant to clean up under the trees-in other words, to take away the fallen apples-on the dates specified in the contract for appellees to begin taking apples. The argument is that the contract is unambiguous, and that additional requirements cannot be ingrafted upon it by parol testimony. This testimony was introduced, not for the purpose of varying the terms of the contract or to add terms, but for the purpose of showing what was essential to a compliance with the terms of contract. Appellees being bound under the contract to accept all apples on the ground after a certain date, this testimony tended to show that it was essential that the fallen apples be cleared away from the trees on the date mentioned so as to determine what appellees were to accept. We think the court was correct in permitting this testimony to be introduced.

[2] The next assignment argued here relates to the ruling of the court in requiring appellant, on cross-examination, to give the reason why he was unwilling to accept a certain offer made to him by the agent of appellees for the deposit of $2,000 in a bank at Centerton. When the last carload of apples was delivered, the price amounting to $712.75, a controversy arose between the parties as to whether this price should be paid to

recover the balance of the money held in reserve unless appellant suffered damages which he was entitled to recover on his counterclaim.

appellant or whether it should be credited | though perhaps erroneous, was harmless, for, on the amount of the $1,500 held as a reserve. as before stated, appellees were entitled to The testimony. shows that appellees claimed that the amount held in reserve was more than sufficient to pay for that car and the remainder of the apples. A witness for appellees testified that during the controversy he made an offer to appellant that appellees would put up in a bank at Centerton an additional sum of $2,000 to cover the price of any additional apples and that appellant refused this offer. On the cross-examination of appellant he was asked to give his reason why he refused this offer. Appellant's reply was that the deposit might be withdrawn FOWLER v. PINE BLUFF SPOKE CO. et al. from the bank as soon as he finished deliver

ing apples. We are unable to see any prejudice whatever in this question and answer. It merely occurred in the cross-examination of appellant for the purpose of testing his good faith and credibility. It was undisputed in the trial of the case that the written contract between the parties controlled, and the court adhered to that view in its various rulings.

The last assignment urged here is that the court erred in giving its third instruction, which reads as follows:

"I charge you that, if the plaintiffs, acting in good faith as reasonable men, and upon reasonable observation or inspection, believed that the $1,500 deposited with defendant would be sufficient to pay defendant for the last car of apples and those remaining undelivered, then there would not be such a breach of contract as would justify or authorize the defendant in treating the contract as rescinded and selling the remaining apples for the account of plaintiff."

Our conclusion is that there was no prejudicial error committed, and the judgment should be affirmed. It is so ordered.

(No. 53.)

(149 Ark. 249)

(Supreme Court of Arkansas. June 20, 1921.) I. Appeal and error 863-On appeal from the sustaining of demurrer to complaint as against one defendant, only question reviewable is cause of action against such defendant.

Where a demurrer was sustained and the

case dismissed as to one defendant and placed on calendar as to the other, the only question presented on plaintiff's appeal relates to the correctness of the ruling that no cause of action is stated against the defendant dismissed. 2. Logs and logging 3(15)-Complaint by seller of timber held to show no privity of contract between it and buyer's vendee.

A complaint, alleging that plaintiff sold timber to J. for a percentage of the price of manufactured products of the timber sold by J., and that J. sold to defendant company all the products, and that the company knew of plaintiff's contract, and frequently delivered its check to plaintiff for his percentage, did not show privity of contract between plaintiff and the company.

Appeal from Circuit Court, Jefferson County; W. B. Sorrells, Judge.

Action by Arthur Fowler against the Pine ment for the defendants, and the plaintiff Bluff Spoke Company and another. Judg

appeals. Affirmed.

E. B. Stokes, of Humphrey, for appellant. Rowell & Alexander, of Pine Bluff, for appellees.

[3, 4] It is clear that appellees were entitled to recover the balance of the reserve fund left in appellant's hands unless appellant has sustained damages for a breach of the contract on appellees' part. The only issue really in the case is whether or not appellees broke the contract by refusing to pay and whether appellant sustained loss by reason thereof. The verdict of the jury is necessarily a finding against appellant as to any loss sustained by him on account of the improper culling of the fruit by appellees or by MCCULLOCH, C. J. Appellant instituted reason of the sale of the fruit on hand after this action in the circuit court of Jefferson the alleged breach. Appellant claims to have county against the Pine Bluff Spoke Comsold the apples at a price less than his con- pany and W. A. Jordan, alleging in his comtract price with appellees, but the whole plaint that he was the owner of certain tracts amount of the remainder of the apples at the of timber land in Arkansas county; that he contract price amounted to a comparatively entered into an oral contract with defendant, small sum in excess of the balance held by W. A. Jordan, whereby he sold to Jordan all appellant in reserve, and it follows that, if the hickory timber on said lands suitable for appellant could have gotten the contract certain purposes; that he was to receive for price by delivering the same to appellees un- said timber as stumpage, 25 per cent. of the der the contract and credited the same on the price of the manufactured products of the advance, he was not entitled to claim com- timber sold by Jordan, and that the latter pensation for loss on the sale made at a lower had sold to the Pine Bluff Spoke Company all price to other persons. This instruction, of the manufactured products of the timber

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

(232 S.W.)

so purchased from appellant. The complaint | facts does not give a right of action to appelcontains a further allegation that the Pine Bluff Spoke Company knew of the agreement between appellant and Jordan, and that "on numerous occasions during the period stated executed and delivered to this plaintiff their check for the said twenty-five per cent. of the materials so inspected, as stumpage charges." It is alleged in the complaint that there is a balance of $587.06 due on the price of the timber, and there is a prayer for judgment against both of the defendants.

The record before us does not show that Jordan appeared, but it does show that appellee the Pine Bluff Spoke Company appeared by attorneys and filed a motion to require appellant to make his complaint more definite and certain, which was sustained by the court, and then filed a demurrer to the complaint as amended, which the court sustained. The judgment reads as follows:

"Now on this day comes on to be heard the demurrer of the defendant the Pine Bluff

Spoke Company to the complaint herein; and the court, being well advised in the premises, doth sustain said demurrer as to the Pine Bluff Spoke Company. Plaintiff declining to plead further, it is ordered that the complaint be dismissed, and that the defendant the Pine Bluff missed, and that the defendant the Pine Bluff Spoke Company have and recover from the plaintiff all its costs herein expended. Plaintiff excepts and prays an appeal to the Supreme Court, which is granted by the court

and noted of record."

[1] After the transcript was lodged in this court the circuit court made an order, correcting its record so as to affirmatively show that the cause was not dismissed as to defendant Jordan, and ordered the cause redocketed against Jordan, and directed the issuance of process for service upon Jordan. It is clear, we think, from the language of the first entry of judgment, that the cause was dismissed only as to appellee the Pine Bluff Spoke Company. The other defendant did not appear at all, and the demurrer did not call for a ruling of the court as to Jordan, the other defendant. The correction by the court, however, makes this plainer, and from the record as it now appears the cause is still pending against Jordan.

[2] The only question, therefore, presented on this appeal relates to the correctness of the court's ruling in holding that no cause of action is stated in the complaint against the Pine Bluff Spoke Company. We think the ruling of the court on this point was correct. The complaint contains no statement of facts which shows any privity of contract between appellant and Jordan, except as vendor and vendee, nor any statement of facts to constitute privity of contract between Jordan and appellee, except that of vendor and vendee. All that the complaint shows is that appellant sold the timber to Jordan, and that Jordan resold it to appellee. This statement of

lant against appellees for the unpaid balance on the price of the timber thus sold to Jordan by appellant and resold by the latter to appellee. Nor does the fact that appellee made payments to appellant on the purchase price render the latter liable for the unpaid balance. In the absence of an express allegation to the contrary, the presumption is that appellee made the payments for Jordan, and not as an assumption of Jordan's contract to pay. There is no theory upon which there can be extracted from the language of the complaint a cause of action in favor of appellant against appellee.

The judgment is therefore affirmed.

(149 Ark. 253)

PERKINS v. GILLETT WAREHOUSE CO. et al. (No. 54.)

(Supreme Court of Arkansas. June 20, 1921.) Master and servant 30(7)-Discharge for accepting other employment held unjustified.

Where the officers of a warehouse company permitted its warehouse manager who was under contract to "devote his entire time to the work," to continue his work for two months without objection after discovery that he was employed as food inspector for the government, and he devoted all the time that was required of him in performance of his duty to the company, and one of such officers was receiving one-half of the manager's salary as food inspector, a discharge on the ground that he accepted other employment was unjustified; the company having waived the breach of the con

tract.

Appeal from Arkansas Chancery Court; John M. Elliott, Chancellor.

Warehouse Company and others. Decree of Suit by A. H. Perkins against the Gillett dismissal, and plaintiff appeals. Reversed, with directions.

Botts & O'Daniel, of De Witt, for appellant.

T. J. Moher, of Gillett, and Jno. L. Ingram, of Stuttgart, for appellees.

MCCULLOCH, C. J. This is an action instituted by appellant in the chancery court of Arkansas county to establish his claim for a debt due under contract by the Gillett Warehouse Company, a dissolved corporation. Appellant alleged that he was employed by said corporation to perform services for 10 months beginning on August 15, 1918, and ending on June 15, 1919, at a stated salary of $1,500 for the term; that he had been paid the sum of $1,050 in monthly installments, leaving a balance due in the sum of $450, and that he was wrongfully discharged on May 1, 1919, and was unable to

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
232 S.W.-2

procure other employment during the remainder of the term. The answer of appellee admitted the execution of the contract, but alleged that according to the terms thereof appellant was to "devote his entire time to the work required of him by the company," and that appellant had broken the contract himself by accepting other employment. The cause was heard by the chancery court on the testimony adduced by each side, and the court found the issues against appellant and rendered a decree dismissing his complaint for want of equity.

The Gillett Warehouse Company, a domestic corporation, was engaged at Gillett, Ark., in the business of buying, storing, and selling rice. Appellant was an expert rice grader and weigher with many years experience, and in August, 1918, the corporation employed appellant as manager of the business for a period of 10 months, as stated in the complaint, at a salary of $1,500. The contract was oral, but the terms thereof are recited in resolution of the board of directors of the corporation at a meeting at which, according to the testimony, appellant was present. This resolution recited that appellant was employed as manager for 10 months at $150 per month, and that it was agreed that appellant "would devote his entire time to the work required of him by the company." E. L. Chaney was president of the corporation, and L. L. Chaney, his son, was secretary and treasurer. Early in September, 1918, appellant was employed as inspector under the United States Food Administration at a salary of $100 per month. When offered the appointment to this place, he stipulated in his contract with the Food Administration that his services were to be performed at the warehouse of the Gillett Warehouse Company, and that he was not required to perform any duties which would require his absence from that place.

Appellant testified that before he accepted this appointment he submitted the matter to E. L. Chaney, the president of the corporation, who consented to his accepting it and performing the work. L. L. Chaney worked at the warehouse, and he and appellant worked together in the operation of the business of the corporation and also shared the work and salary of appellant under the appointment by the Food Administrator. E. L. Chaney denied that he was consulted by appellant as to the appointment as food inspector. The duties of appellant as food inspector were to grade and weigh rice, which were also a part of his duties in the management of said corporation. L. L. Chaney admitted that he knew about appellant's employment as food inspector, and that in December, 1919, he began the acceptance of part of the salary, and that he received half of the salary for four months. Appellant said that L. L. Chaney accepted the

salary from September 15, 1918, up to the time of appellant's discharge on May 1, 1919. It is conceded that all of the parties, including the directors of the corporation other than E. L. Chaney and L. L. Chaney, ascertained in January, 1919, that appellant had been employed as food inspector and was receiving a salary as such and no objection was made until he was discharged on May 1st. Appellant testified that when he was discharged the only grounds stated for the discharge were that the corporation was not making any money on that year's business, and that his discharge was essential for economy in the operation of the business. Each of the two Chaneys testified that appellant was discharged on account of giving a portion of his time to the service of the United States Food Administration. It is also conceded that appellant properly performed all of his duties as manager of the business of his employer, Gillett Warehouse Company, and that he did not neglect his work in any respect, that all of his services performed for the Food Administration were at the warehouse, and that the corporation suffered no loss or injury by reason of neglect on the part of appellant to perform his duties.

It is unnecessary to determine where the preponderance of the testimony lies as to some of the issues in the case; for we are clearly of the opinion that, according to the uncontradicted evidence, appellant is entitled to recover on the ground that appellees waived the alleged breach of the contract by appellant, if there was indeed a breach, according to the testimony, by permitting him to continue in the performance of the contract for at least two months without objection after discovering that he was working in other employment. It will be observed that, according to the terms of the contract as specified in the resolution adopted by the board of directors of the corporation, appellant was not expressly prohibited from accepting other employment, but that he would "devote his entire time to the work required of him by the company." According to the uncontradicted testimony, appellant did devote all the time that was required of him, and he did not to the least extent neglect his duty to his employer. And, according to the undisputed testimony, the directors of the corporation, including the two Chaneys, who were its active managers, ascertained that appellant was performing other work in January, and they permitted him to continue without objection until he was discharged on May 1, 1919. In the meantime one of the Chaneys was getting half of appellant's salary as food inspector.

Counsel for appellees rely on the case of Van Vleet v. Hayes, 56 Ark. 128, 19 S. W. 427, as sustaining their contention that the failure to object to appellant's employment

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