(248 S.W.) ance companies paid Jones $1,826.90. Each of the policies contained the following provisions: "If this company shall claim that fire was caused by the act or neglect of any person or corporation, private or municipal, this company shall, on the payment of the loss, be subrogated to the extent of such payment to all right of recovery by the insured for the loss resulting therefrom, and such right shall be assigned to this company by the insured on receiving such payment." The companies took an assignment of the claim from Jones, and on August 10, 1918, brought this suit against Pettit-Galloway Company, engaged in business as plumbers, alleging that the fire and loss was caused by the negligence of that company in thawing some frozen pipes in the house, and at the trial testimony was offered from which the jury might have found that the fire was caused by the negligence of an employee of the plumbing company. At the trial, however, the court directed a verdict in favor of the defendant on the ground that the insurance company could not maintain the action without making Jones a party. When the court indicated the action it was about to take the plaintiff asked to be allowed to make Jones a party, but the court refused to permit this to be done, and judgment was rendered for the defendant. For the reversal of the judgment it is insisted, first, that Jones was not a necessary party, and, second, that, if Jones was a necessary party, the court should have permitted the plaintiff to make him a party under the facts of the case. These facts were that the defendant had filed a motion to make the complaint more specific, and a motion to require the plaintiff to give bond for costs, but did not raise the question of a defect of parties until shortly before the trial. [1] Jones was a necessary party. This is true because the cause of action here sued on is one not assignable at law. The case of C., R. I. & P. R. Co. v. Cobbs, 151 Ark. 207, 235 S. W. 995, is similar to, and is decisive of, this case. Property belonging to Cobbs was destroyed by fire by the railway company. Insurance thereon covering only a part of the loss was paid by the insurance company, which took an assignment of Cobbs' cause of action against the railway company to the extent of the amount paid by it, and suit was brought by the insurance company for the sum paid by it, and by Cobbs for the value of the property in excess of the insurance. There was a motion to remove the cause to the federal court on the ground of diversity of citizenship. The motion to remove was overruled by the trial court, and in affirming that action this court said: "It is not shown in the petition or in the complaint that these are separable causes of action, nor is it contended that the causes of action asserted by the different plaintiffs are separable, and it is clear that they are not separable. The insurance companies by virtue of the assignment to them of a portion of the right of actions are possessed of an interest in the subject-matter in controversy, and are therefore necessary parties. Cobbs, the other plaintiff, was a necessary party, not only from the fact that he was the owner of an interest in the subject-matter of this controversy, but also for the reason that he was assignor of that part of the cause of action which was asit is a right of action not assignable under our signed to the insurance companies, and since statute (Crawford & Moses' Digest, § 475), the assignor was a necessary party to a suit to recover. St. L., I. M. & S. R. Co. v. Camden Bank, 47 Ark. 541. Under the statute cited above, only agreements or contracts in writing are assignable, and the cause of action in the present instance was not based on an agreeThe insurance companies ment in writing. succeeded, by the assignment, to the right of action by Cobbs for the recovery of unliquidatthe railway company." ed damages on account of the wrongful act of [2] We think, under the circumstances, the court should have permitted Jones to be made a party plaintiff, imposing terms as to costs if thought proper so to do, but for the fact that at the time of the trial the cause of action in Jones' favor was barred by the statute of limitations, and making him a party at the time that request was made would have been unavailing. The judgment is therefore affirmed. THOMPSON v. SHORT. (No. 189.) (Supreme Court of Arkansas. Feb. 26, 1923.) 1. Contracts 353 (8)—Instruction permitting defendant to recover for breach of contract regardless of whether he had also breached it held error. An instruction in an action for damages for the breach of a contract wherein defendant counterclaimed asking damages also for breach, that, if plaintiff had failed to comply with the contract by failing to pay defendant, then defendant had the right to treat the contract as null and void, and recover, held erroneous as giving defendant the right to recover regardless of whether or not he, too, had breached the Appeal from Circuit Court, White County; J. M. Jackson, Judge. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes Action by W. A. Thompson against W. J. Short. From judgment for defendant, plain- | lant. tiff appeals. Reversed and remanded. W. A. Thompson instituted this action against W. J. Short to recover damages for an alleged breach of contract whereby the defendant agreed to clear 165 acres of land in White county, Ark. The defendant filed an answer and cross-complaint, in which he denied having breached the contract on his part, and asked for damages on account of an alleged breach of the contract by the plaintiff. The contract between the parties is in writing, and provides that W. J. Short should clear 165 acres of land for W. A. Thompson in White county, Ark., and should receive as compensation therefor the sum of $50 for 60 acres of said land, which had already been cleared, but had grown up with underbrush, and the sum of $5 per acre for the remainder of the land together with the timber on it. The contract provides for payments to be made as the clearing progresses in certain stipulated amounts, which need not be set out in detail. The contract also provides that the land should be all cleared by the 1st of April, 1918. The time of the performance of the contract was extended on account of the World's War, and numerous letters passed between the parties in regard to the extension of the time of the performance of the contract. The correspondence is too long to be set out in this opinion and, indeed, it is not necessary Brundidge & Neelly, of Searcy, for appelMiller & Yingling, of Searcy, for appellee. HART, J. (after stating the facts as above). [1] It is insisted by counsel for the plaintiff that the court erred in giving instruction No. 1 at the request of the defendant. The instruction reads as follows: plaintiff failed to comply with the contract in "You are instructed that if you find that the that he failed to pay the defendant for work done under the contract as required by the terms of the contract, then the defendant had the right to treat the contract as null and void and your verdict will be for the defendant." The instruction is erroneous because it gives the defendant the right to recover if the plaintiff failed to pay him for the land which he had already cleared, regardless of the fact of whether or not the defendant committed a breach of the contract on his part. The contract provides that the clearing of the land should be completed by April 1, 1918, by the defendant. It appears from the letters passed between the parties that the time for the performance of the contract was extended until January, 1920. The undisputed evidence shows that 65 acres of the land remains to be cleared, and, according to the testimony of the plaintiff, the defendant did not in all respects comply with the terms of the contract in the land which he did clear. Then, too, according to the plaintiff's tes timony, the defendant did not demand payment for the land which he had cleared until some time after the time limit for finishing committed a breach of the contract on his the clearing had expired. If the defendant part by not clearing the land the plaintiff would be entitled to recover damages on this in order to discuss the issues in the appeal. It appears from the plaintiff's own letters that he extended the time of the performance of the contract until January 1, 1920. According to his testimony the defendant did not clear the land in accordance with the terms of the contract. According to the tes-account, and might offset the amount which timony of the defendant he cleared and prepared for cultivation 100 acres of the land. This included the 60 acres which had formerly been cleared, but which had grown up in bushes to a certain extent, and had some dead timber standing on it. The plaintiff owed him, under the terms of the contract, at least $100, which he refused to pay him. The defendant demanded this amount of the plaintiff orally in June, 1920, and the plaintiff neglected and refused to pay him. In July, 1920, the defendant wrote the plaintiff a letter in which he refused to further perform the contract because the plaintiff had not paid him in accordance with its terms for the clearing that he had already done. Other facts necessary for a decision of the issues raised by the appeal will be stated or referred to in the opinion. The jury returned a verdict for the defendant in the sum of $100, and from the judgment rendered the plaintiff has duly prosecuted an appeal to this court. he was due the defendant for work already done by the damages which he was entitled to recover from the defendant for the nonperformance of the contract by the defendant. In this connection it may be stated that the damages claimed and testified to by the plaintiff for the alleged breach of the contract by the defendant would amount to more than the amount allowed the defendant by the verdict of the jury. Hence the court erred in giving this instruction. [2] In view of another trial of the case, we call attention to the fact that instruction No. 3 given by the court at the request of the plaintiff is erroneous, although no assignment of error is predicated upon the action of the court in giving this instruction. The instruction reads as follows: "You are instructed that, if you find that the parties made and entered into the written contract sued on in this case, the defendant cannot under the law excuse a breach of said contract by setting up a different and verbal con (248 S.W.) tract claimed to have been made by the defend-, enjoin them from interfering with their posant with the plaintiff at a different time, and subsequent to the written contract sued on." It is well settled in this state that no rule of evidence is violated by allowing proof of a subsequent parol agreement changing the terms of a prior written contract. Caldwell v. Dunn (Ark.) 245 S. W. 809, and cases. In view of a new trial of the case, and the fact that additional testimony may be introduced by the parties, we do not pass upon the assignment of error that the evidence is not sufficient to support the verdict. For the error in instructing the jury as indicated in the opinion, the judgment must be reversed, and the cause remanded for a new trial. session as mortgagees of a certain crop and other personal property in St. Francis county, Ark. Subsequently the plaintiffs amended their complaint and asked for a foreclosure of their mortgage. The defendants claimed the property under a pledge to secure an existing indebtedness, and filed a cross-complaint against the plaintiffs for damages for | an alleged breach of contract to furnish them funds with which to gather the crop in dispute. It appears from the record that the plaintiffs are partners under the firm name of Wynne & Co., as cotton factors in Memphis, Tenn. J. C. Hooten & Co., an Arkansas corporation, became indebted to them in the sum of approximately $50,000. J. C. Hooten was the owner of nearly all of the stock in said corporation, and was engaged in farming on a large scale in Poinsett and St. BELFORD et al. v. ABSTON-WYNNE & CO. Francis counties, in the state of Arkansas. (No. 190.) (Supreme Court of Arkansas. Feb. 26, 1923.) 1. Pledges 11-Actual delivery of pledged property necessary. Delivery of pledged property is absolutely necessary, and without possession in pledgee there can be no privilege thereunder as against a third person; and there was no delivery by a corporation to its manager where the manager was already in possession, and apparently retained possession, for the corporation. 2. Pledges 34-Property not shown to be turned over to pledgee. In suit to enjoin defendants from interfering with plaintiffs' possession as mortgagees of a crop and personal property of a corporation, where defendants claimed the property was turned over to them as collateral security for unpaid salaries as managers of the company, evidence held insufficient to show delivery in pledge to defendants. 3. Appeal and error J. C. Hooten had charge of the business in Poinsett county, and Harry Belford and Frank Taylor had charge of the business in St. Francis county. Harry Belford was the Co. also ran commissaries in connection with manager and bookkeeper. J. C. Hooten & its farming operations in both counties. Harry Belford was working for J. C. Hooten at a salary of $150 per month during the year 1920. None of his salary for that year was paid, and he also furnished the corporation $150 of his own money. According to the plaintiffs, in August, 1920, J. C. Hooten and Harry Belford came to their place of business in Memphis, Tenn., for the purpose of making a contract with them to furnish money with which to gather the crops. On the 12th day of August, 1920, J. C. Hooten & Co. executed a mortgage to Abston-Wynne & Co. to secure $10,000 which was to be furnished in gathering and market mortgage was duly executed and filed for record on the 6th day of September, 1920. Subsequently J. C. Hooten & Co. became⚫ further indebted to Abston-Wynne & Co. for advances made under the mortgage to be used in gathering the crop. 837(10)-Evidence not appearing in record not considered on appeal. ing the crop on the land owned by said corIn suit to enjoin defendants from interfer-poration in St. Francis county, Ark. The ing with plaintiffs as mortgagees of a crop, where defendants claimed the property was turned over to them as security for a debt owing them from the mortgagor, and also that a note which was transferred to one defendant as collateral security was secured by a chattel mortgage on a crop of cotton, but the note and mortgage were not introduced in evidence, any argument on rights under the mortgage cannot be considered on appeal. At the time the contract for the advances to be used in gathering the crop was made, Abston-Wynne & Co. understood from J. C. Hooten and Harry Belford that the latter Appeal from St. Francis Chancery Court; was the manager and in possession of the A. L. Hutchins, Chancellor. Action for injunction by Abston-Wynne & Company, a copartnership, and another against Harry Belford and another. From a decree for plaintiffs, defendant named appeals. Affirmed. Abston-Wynne & Co. brought this suit against Harry Belford and Frank Taylor to crop and personal property on the farm as such manager. No information was given them from which it could be inferred that Harry Belford or Frank Taylor had any claim or interest in the crop. After making certain advances Abston-Wynne & Co., deeming themselves insecure, sent an agent to see J. C. Hooten about taking possession of the crop and gathering it in order to indemni For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes 266 fy themselves from loss under their mortgage. Upon being approached about the matter, J. C. Hooten made some evasive answer, and told the representative of Abston-Wynne & Co. that he thought that they had already taken possession of the crop. On the next day he left the country, and has not been heard of since. Harry Belford and Frank Taylor refused to deliver possession of the crop to Abston-Wynne & Co., and claimed it had been delivered to them in pledge by J. C. them for their wages. Hooten to secure According to the testimony of Harry Belford, J. C. Hooten first turned over to him as collateral security for his unpaid salary a note for $1,200, which was secured by a mortgage on a pair of mules and a wagon. We quote from his testimony the following: "Q. What, if any, agreement did he make with you later about the crop and the other property when he couldn't pay you? was over there later, and I asked him for some A. Well, he money, but he said he didn't have any, and said that I could get my money out of the crop, and all the farming tools, or whatever was there, but later said he would just turn it all to me -to Frank Taylor and I." We also quote from his testimony what occurred at the time J. C. Hooten went to Memphis in August to see Abston-Wynne & Co. and make arrangements with them about getting money with which to gather the crop. On this point Belford testified as follows: "Q. Tell now what agreement you made there in the presence of Mr. Hooten with Abston & Wynne about this cotton crop? A. We went up there, and there wasn't any one there but Mr. Wynne. So Mr. Hooten, Mr. Wynne, and I were in Mr. Abston's office. Mr. Abston was gone somewhere, I don't know where, so he told Mr. Wynne it was impossible for him to be over there at the farm, as he had to keep books there at Tyronza, and that whenever he left there things might as well be shut down, because they wouldn't do anything there, and he said he had just turned everything to me over there, and wanted him to deal with me. So Mr. Wynne asked him what kind of an agreement he wanted to make, and he told him he had gone as far as he could with that crop over there without getting some help, so Mr. Wynne asked him how much help he would need. He said he was so far behind with the payments over there that he didn't know, and we told him as near as we could about what we were behind. "Q. Were you talking? A. Yes, sir. "Q. To Mr. Wynne? A. Yes, sir." The chancellor found the issues in favor of the plaintiff, and dismissed the cross-complaint of Harry Belford and Frank, Taylor for want of equity. It was also decreed that the plaintiffs were entitled to a foreclosure of their mortgage. Harry Belford alone has appealed. (Ark. lant. lees. above). [1] It is elementary law that the deHART, J. (after stating the facts as livery of pledged property is absolutely necessary to the life of the contemplated pledge, and that without such possession in the pledgee there can be no privilege thereunder as against a third person. Lee Wilson & Co. W. 885. This is not a case where a pledgee v. Crittenden County Bank, 98 Ark. 379, 135 S. session, as by a deposit or a loan, so that has the pledged property already in his possession of the property as a pledge. the very contract would transfer to him posBelford was not in possession of the property Here for himself, but held possession of it for J. C. Hooten & Co. as its manager. His possession, then, was the possession of the corporation which employed him. his possession as pledgee something more [2] In order to transfer the property to must have been done than the executory con tract which he claims to have made with J. C. Hooten. According to his own testimony, Hooten told him that he could get his money out of the crop and the farming tools, and later said that he would turn them over to Belford. There is nothing in this testimony to show that the property was actually turned over to Belford. His continued holding as the manager of a corporation would himself as pledgee. His testimony as to what not constitute possession of the property for occurred in August when he went to see Abston-Wynne & Co. with J. C. Hooten is contradicted by both Abston and Wynne. They both testified positively that at no time on that occasion did Belford claim any interest whatever in the crop which Hooten proposed to mortgage them to secure advances with which to gather it. Hooten was already largely indebted to them, and according to the testimony of Belford, even, he was hard pressed for money, and unable to pay him. It is more reasonable to suppose that money with which to gather the crop, and the plaintiffs agreed to advance Hooten took a mortgage from him to secure themselves, than it is to suppose that they dealt with Belford as the pledgee of the crop. Their testimony in this respect is corroborated by that of their representative whom they sent in the fall to take possession of the crop under their mortgage. He testified that him, but made no claim to the mortgaged Belford told him that Hooten was indebted to property as against Abston-Wynne & Co. Hence we are of the opinion that the chancellor was right in finding the facts on this point in favor of the plaintiffs, and in dismissing the cross-complaint of Belford and Taylor for want of equity. (248 S. W.) W. C. Rodgers, of Nashville, for appellants. [3] It is next insisted that the note of, Bacon and others. From the decree in the Lincoln Johns for $1,200, which was trans- Chancery Court, defendants appeal. Decree ferred to Harry Belford as collateral secu- affirmed. rity, was secured by a chattel mortgage on the cotton grown on the plantation operated by Hooten & Co. in St. Francis county. It does not appear from the record that this note and mortgage was introduced in evidence. Therefore any argument based on the rights of the parties under this mortgage canpot be considered by us. Abe Collins, of De Queen, Epperson & Jackson, of Dierks, and Buzbee, Pugh & Harrison, of Little Rock, for appellees. McCULLOCH, C. J. The road improvement It follows that the decree will be affirmed. district which is plaintiff in this action was 1. Highways 90-Description of lands Included in road improvement district held not vague. Where the Saline river formed the boundary between Howard and Sevier counties, descriptions of lands in court order and in a curative statute creating a road improvement district as being in Howard county, and describing the lands by sections and subdivisions thereof, and specifying certain sections, giving their number as "on the left bank of the Saline river," is not vague, but is to be construed as referring to that portion of each section which lies on the east side of the river and is in Howard county. 2. Constitutional law 143-Highways 90-Statute dismembering road improvement district after bond obligations incurred held invalid as impairing obligation of contract. Sp. Acts 1921, No. 594, excluding from a road improvement district after bond obligations for road improvements were incurred half of the lands originally embraced therein, thus enlarging the burdens of such obligations upon lands remaining in the district, conflicts with Const. art. 2, 17, prohibiting laws impairing obligation of contracts. originally created under the general statutes by an order of the county court on October 7, 1918, but there was a special statute enacted by the General Assembly of 1919 (Road Acts 1919, p. 201) curing irregularities in the organization and establishing the district as a valid improvement district covering the territory embraced in the original order creating it. The assessments of benefits were completed, a contract was let for the construction of the road, and a great portion of the improvement was constructed-11 miles of the 17-mile length of the proposed road. Bonds in the sum of $130,000 to raise money to pay for the cost of the improvement were also issued and sold subsequent to the enactment of the curative statute referred to above. The present action was instituted by the board of commissioners against all delinquent owners of land in the district, including appellants, and an appeal has been prosecuted from the decree of the chancery court decreeing payment of the delinquent assessments and declaring a lien on the lands. Appellants answered and filed an answer and cross-complaint attacking the validity of the assessments and also the validity of the district itself. So far as concerns the correctness and validity of the assessments, it is sufficient to say that the attack comes too late, since the assessments have been approved and have become final. There were attacks on the validity of the assessments by owners of property, who protested against them in apt time, and the cases were brought to this 3. Statutes 63-Invalid statute passed sub-court from the circuit court, where the quessequent to curative act establishing road improvement district held not ground for nullifying district. Where a road improvement district created under general act has been established by a curative act, the fact that a subsequent statute (Sp. Acts 1921, No. 594) attempting to dismember that district is void affords no grounds for nullifying district. tions were adjudicated on appeal from the county court. Payne v. Road Imp. Dist., 149 Ark. 491, 232 S. W. 943; Id., 152 Ark. 170, On the last appeal of the 237 S. W. 685. case we affirmed the judgment of the circuit court approving the assessments. [1] The validity of the district is assailed on the ground that the description of the lands embraced in the district were in many instances so vague that it is impossible to Appeal from Howard Chancery Court; Jas. determine what lands were meant to be deD. Shaver, Chancellor. Suit by Road Improvement District No. 1 of Howard County and others against G. D. scribed, and that the district, for that reason, is void. In the order of the county court creating the district, as well as in the special act of For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |