(248 S.W.)

minous and in many respects conflicting. This might well be expected as the basis of most of it is the opinion of the witnesses as to rental value. No useful purpose would be served by setting this testimony out.

was a part of the "premises," and was in-, tract to Nakdimen. This testimony is volucluded in that designation. The second reason was the fact, as it then appeared to us, that Nakdimen was not operating his elevator, and we had refused to compel him to do so. This refusal imposed upon the company elevator the service which the parties contemplated the two elevators should perform. Nakdimen had breached his contract, as we found, and this breach was to be compensated by way of damages. The other privileges conferred by the contract, such as the use of the stairway, lobby, and hallways, were being jointly used by the parties as the contract contemplated, and the value of these privileges was to be considered in determining the rental value.

The Nakdimen elevator is now being operated, and the parties are getting what they

We have had much difficulty in determining what the fair rental value is as shown by the testimony, and after carefully considering this testimony and reconciling our own views in regard to it, we have concluded that the rental value should be fixed at $33.33 per month, and the decree of the court below will be modified to accord with that view.

MENT DIST. v. MISSOURI PAC. R.
CO. et al. (No. 187.)

mutually contracted for originally. It ap- WESTERN CRAWFORD ROAD IMPROVE. pears the parties then contemplated there would be a difference of opinion as to the rental value after the 10-year period, for they provided for an arbitration of that question without requiring the parties to first consider it.

(Supreme Court of Arkansas.

Feb. 26, 1923. Rehearing Denied March 26, 1923.)

1. Highways 90-Method of assessment to pay preliminary expenses, If Improvement contemplated by special act creating district is abandoned, held valid.

The method of assessment prescribed by special statute, extraordinary session 1920, creating Western Crawford road improvement district in Crawford county, if the contemplated improvement thereunder is abandoned, which provides (section 25) that the preliminary expense shall be a first lien on all of the lands in the district, paid by levy of a tax on the assessed value for county and state taxation, is

The reciprocal privileges for the 10-year period were identical with those for the first 10-year period, and "the rental to be paid by the party of the first part to the party of the second part for the concession and privilege herein granted, as herein set out," was the matter which the contract provided the arbitrators should determine, but as Nakdimen failed and refused to name an arbitrator, as there provided, it became the duty of the court to make the finding which the arbitrators should have made, and the direction given to the court below was to make this finding after compensating the company for 2. Highways Nakdimen's refusal to operate his elevator.

As we have said, the court below was largely controlled, in fixing the rent at $25 per month, by the fact that the parties had themselves fixed it at that amount, and it is insisted that we, too, should reach the same conclusion, for the reason that conditions have not substantially changed since the execution of the contract, and the parties were the best judges of the reciprocal value of the contract to each other.

valid.

90-Legislative determination

as to preliminary expense of improvement abandoned by Improvement district conclusive, unless prima facie arbitrary and unreasonable.

The legislative determination that the preliminary expenses of an improvement abandoned by an improvement district would not exceed is conclusive, unless shown on its face to be the anticipated benefits from its construction arbitrary and unreasonable.

3. Highways 122-Legislative determination as to method of determining benefits from an improvement conclusive, unless shown arbitrary, and not so shown.

The fact mentioned is, of course, very significant, but it is not controlling. It now appears that the company elevator carries 97 per cent. of the traffic, with the consequent cost of its operation, which the owners of that building must pay. This results chiefly from the more convenient location of the company elevator, and from the fact that it is more modern. In other words, it now appears that the company is largely furnishing the elevator service which the contract contemplated should be jointly furnished. The testimony developed this and other facts which the numerous witnesses mentioned in testifying as to the rental value of the con- Wood and Hart, JJ., dissenting. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

While the assessment for preliminary expenses of an abandoned road improvement unexceed the anticipated benefits, the legislative der a special act creating a district must not determination as to the amount of the benefits or its provision for the method of determining benefits, is conclusive, unless shown arbitrary, and it is not sufficient to overcome this by showing that an incomplete assessment of benefits was less than the amount of taxes landowners would be required to pay under the method prescribed.

Appeal from Crawford Chancery Court; | cuted from that part of the decree. The reJ. V. Bourland, Chancellor. mainder of the claims were approved by the Petition filed by the Western Crawford chancery court and ordered paid, but, in the Road Improvement District to assess the property of the Missouri Pacific Railroad Company and other landowners in the district, to pay preliminary expenses of an abandoned road improvement. From the decree entered the district appeals. Reversed and remanded, with directions.

E. L. Matlock, of Van Buren, for appel

lant.

Thomas B. Pryor, of Ft. Smith, for appellees.

final decree rendered, the court refused to order payment of assessments in accordance with the directions of the statute quoted above, but ordered that the payments be made in proportion to the anticipated benefits assessed by the board of assessors.

It appeared from the proof that the property of two railroad corporations, whose lines of railroad ran through the district, would, under the method of assessment prescribed by the statute, amount to more than the whole of the anticipated benefits as assessed by the assessors of the district. It MCCULLOCH, C. J. A road improvement is shown that the assessed benefits of the district, designated as Western Crawford Missouri Pacific Railroad were $1,960, whereroad improvement district, was created in as the levy of the tax on that property, acCrawford county by special statute (unpub-cording to the "assessed value for county and lished) at the extraordinary session of the state taxation," would amount to $2,396.62. year 1920, and there were proceedings under The board of assessors had assessed the the statute up to the assessment of benefits by the assessors and the filing of the list of assessments with the clerk of the county court for approval by the board of commissioners. The statute contained the usual provisions with reference to giving notice of the assessments and providing for a hearing upon the

correctness of the assessments.

On the day provided for the hearing, there were numerous protests made by owners of property to further proceedings toward the construction of the improvement, on the ground that the improvement was too expensive, and that the cost would probably exceed the benefits, and the commissioners, without acting upon the list of assessments filed by the assessors, decided to abandon the whole project as being impracticable. There were no further proceedings towards carrying out the construction of the improvement, but there had been preliminary expenses incurred, and the statute contained the follow, ing provision with reference to the payment of such expenses:

"Sec. 25. In case, for any reason, the improvement contemplated by this district is not made, the preliminary expense shall be a first lien upon all of the lands in the district, and shall be paid by a levy of a tax thereon upon the assessed value for county and state taxation, which levy shall be made by the chancery court of Crawford county and shall be collected by a receiver to be appointed by said court."

The commissioners of the district, pursuant to the provisions of that part of the statute quoted above, prepared an itemized statement or list of the preliminary expenses, and filed a petition in the chancery court of Crawford county, setting forth in detail all the proceedings in connection with the preliminary expenses incurred, and asked the court to levy a tax upon the property in the district to raise funds for the payment of such expenses. The court disallowed one of the claims, but no appeal has been prose

property of the St. Louis-San Francisco Railway Company at $2,341.50, and it is shown that the amount to be paid on a levy in accordance with the provisions of the statute would be $2,769.40.

The chancery court based its conclusion on the ground that the assessment made by the board of assessors was conclusive as to the amount of anticipated benefits from the construction of the improvement, and that the owners of property could not be taxed for preliminary expenses in excess of the anticipated benefits.

[1] It will be observed that the statute involved in this inquiry expressly provides that, in case the contemplated improvement is abandoned, "the preliminary expense shall be a first lien upon all of the lands in the district, and shall be paid by a levy of a tax thereon upon the assessed value for county and state taxation." This court has decided heretofore that the method of assessment prescribed in this statute is valid as applied to the method of payment for a completed improvement (St. L. S. W. Ry. Co. v. Board of Directors, 81 Ark. 562, 99 S. W. 843), or for the method of payment of preliminary expenses (Board of Directors v. Dunbar, 107 Ark. 285, 155 S. W. 96: Neterer v. Dickinson & Watkins, 153 Ark, 5, 239 S. W. 722). The decisions on this question were based on the ground that the statute constituted a legislative determination that benefits would accrue in proportion to value. Special application of this rule was made in the Neterer Case, supra, where a different method of assessment had been provided under the statute for payment of the cost of the improvement, if completed. In that connection we said:

"The two methods of assessment are for wholly different purposes. One is for the payment of the cost of the completed improvement, which must be by taxation based upon and ap

(248 S.W.)

portioned on benefits to accrue. The other is a mere provision for the payment of preliminary expenses where the improvement is not undertaken at all. This provision necessarily implies a determination by the Legislature that there are anticipated benefits, at least to the extent of the cost of the preliminary expenses, apportioned according to assessments for county purposes, but it is neither unfair nor violative of any right of landowners to provide that, in the event the contemplated improvement is not undertaken, the preliminary expenses shall be paid according to value, and not according to anticipated benefits. The distinction lies between the payment of preliminary expenses and payment of the actual cost of the improvement,"

[2] It is true that we reiterated in that case what had already been held in the Dunbar Case, supra, that assessments for payment of preliminary expenses could not be exacted in excess of anticipated benefits, but in each of those cases we emphasized the

an incomplete assessment of benefits made by the board of assessors was less than the amount of taxes that the appellees would be required to pay under the other method prescribed by the statute.

The chancery court erred, therefore, in refusing to follow the statute, and the decree is reversed and the cause remanded, with directions to enter a decree levying taxes on the property in the district in accordance with the terms of the statute; that is to say, “upon the assessed value for county and state purposes."

WOOD and HART, JJ., dissent.

COLUMBIA SCHOOL SUPPLY CO. v. CALI-
CO ROCK SPECIAL SCHOOL DIST.
(No. 164.)

Rehearing Denied March 26, 1923.)

Contracts 240-Evidence showed modification of contract for school desks, but not complete novation thereof.

principle that a provision for payment of (Supreme Court of Arkansas. Feb. 12, 1923. preliminary expenses necessarily implied a legislative determination that the cost of the preliminary expenses would not exceed the anticipated benefits from the construction of the improvement. The legislative determination is conclusive, unless shown on its face to be arbitrary and unreasonable. Desha Road Imp. Dist. v. Stroud, 153 Ark. 587, 241 S. W. 882, and cases cited therein.

There is nothing shown in the present case to overcome the legislative determination, except the unapproved assessment lists filed by the board of assessors. The assessment was incomplete, because it was never approved by the board of commissioners. The point was never reached for the approval, for there was an abandonment of the district before this was done, and we do not certainly know what the assessments against the railroads would have been had the assessment of benefits proceeded to finality.

[3] Counsel for appellees lay stress upon the statement in the opinion in the Neterer Case to the effect that the payment of preliminary expenses must not exceed the anticipated benefits, but this was a mere reiteration of what we have held in other cases in regard to taxation upon property, and was a mere statement of the principle, without undertaking to determine how it might be shown that the taxes exceeded those benefits. We have always adhered to the principle that the right to tax for local improvements is limited to the amount of anticipated benefits, but, at the same time, we have consistently held that the legislative determination of the amount of benefits, or the legislative provision for the method of determining benefits was conclusive unless shown to be arbitrary. So we hold now that this legislative determination is conclusive, and it is not sufficient to overcome this by showing that

Where a school district ordered supplies which included 288 tubular desks from a third person who placed order for the desks with plaintiff and assigned to it so much of the order as included the desks as security for payment, in an action against the school district for the amount of goods shipped after notice of assignment was given the district, evidence held to show a modification of the contract but not a complete novation thereof.

Wood and Hart, JJ., dissenting.

Appeal from Circuit Court, Izard County; W. L. Pope, Judge.

Action by the Columbia School Supply Company against the Calico Rock Special School District. From a judgment for defendant, plaintiff appeals. Reversed and for new trial. rendered conditionally; otherwise remanded

Rogers, Barber & Henry, of Little Rock, for appellant.

John L. Bledsoe, of Pocahontas, and Godwin & Sherrill, of Melbourne, for appellee.

HUMPHREYS, J. Appellant instituted suit in the Izard circuit court against appellee to recover $1,432.80 for school desks alleged to have been sold and delivered to appellee by appellant.

Appellee filed an answer denying that it owed appellant for the desks, stating that the desks in question were purchased from the Educational Supply Company and paid for in cash and school warrants when the purchase was made, and that said school warrants were subsequently redeemed.

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

The cause proceeded to a hearing upon the, cational Supply Company to said Columbia pleadings and testimony, at the conclusion School Supply Company."

Rock as agent for the Columbia School Sup-lant, and had not redeemed the outstandply Company unless such authority is later ing warrant of $1,000. withdrawn, which right the Columbia School ten to appellee subsequent to the delivery Supply Company withholds. In the event that the Columbia School Supply Company receives in cash or in accepted school board warrants or vouchers the sum sufficient to cover the indebtedness from the Educational Supply Company, including shipment to Calico Rock, then this assignment shall be null and void, but otherwise shall be in force up to the extent that it shall cover all indebtedness from said Edu

(248 S.W.)

the amount, if paid directly to it in cash or contract was with the privilege of renewal, and in a warrant, if made to include interest. asking for a reformation, evidence of alleged The payment was not made direct, presum- fraudulent misrepresentations concerning the ably because the balance covered by the out-contents of the contract were insufficient withstanding $1,000 warrant had, in the meanin the rule requiring that grounds of relief time, been assigned by the Educational Sup-dence. must be established by clear and convincing eviply Company to Peters & Volz.

Appellant insists that the judgment should be reversed because the evidence is insufficient to support the judgment; and for a judgment here for the amount sued for less freight, drayage, and assembling charges, upon the ground that such a judgment is warranted by the undisputed testimony. In other words, appellant contends that under the undisputed evidence there was a complete novation of the contract. We cannot fully agree with appellant's interpretation of the testimony. The evidence is entirely wanting to support the judgment rendered by the court; but the testimony, as now revealed by the record, is sharply conflicting as to whether appellee is indebted to appellant in a sum greater than $712.47. The undisputed testimony, as now reflected by the record, does show a modification of the contract, but not a full and complete novation thereof. According to the undisputed testimony, payment was to be made directly to appellant in some amount. The amount, however, is not disclosed by the undisputed testimony. The testimony introduced by appellant tends to show that the sales price, less freight charges, etc., is the correct amount, and the testimony introduced by appellee tends to show that $712.47 is the cor

rect amount.

For the error indicated the judgment is reversed, but a judgment for a larger sum than $712.47 cannot be rendered here on the undisputed evidence. Judgment is directed to be entered for that amount, if, within 15 days, appellant assents thereto; otherwise the cause will be remanded for a new trial.

WOOD and HART, JJ., dissenting.

ARKANSAS NAT. BANK v. OUTCAULT ADVERTISING CO. (No. 185.) (Supreme Court of Arkansas. Feb. 26, 1923. Rehearing Denied March 26, 1923.) Reformation of Instruments 45(2) dence insufficient to establish fraudulent representation concerning contract to be within rule of relief.

Evl

Where an advertising order provided for automatic renewal unless an option of countermanding was exercised by buyer, in an action for supplies furnished after the original term had expired in which buyer alleged fraud of plaintiff's agent in procuring the contract, in that defendant understood from him that the

Ben F. McMahan, Chancellor.
Appeal from Washington Chancery Court;

Action by the Outcault Advertising Company against the Arkansas National Bank. From a decree for plaintiff, defendant appeals. Affirmed.

B. R. Davidson, of Fayetteville, for appellant.

Jno. W. Grabiel, of Fayetteville, for appellee.

McCULLOCH, C. J. Appellee, a foreign corporation, is engaged in the business of furnishing to banking institutions and other business institutions supplies for advertising purposes, to be paid for in weekly installments, and appellant entered into a written contract with appellee in the form of an accepted order for furnishing supplies and services of the character just mentioned for a period of two years, beginning with the date of the contract (December 20, 1916), with the further stipulation that the contract was—

"to continue in full force and effect for a further period of three successive years on the same conditions, unless we [the appellant] notify you to the contrary in writing on or before February 1, 1918."

That portion of the order which specifies the unconditional period of the contract is in the beginning of the printed order, but the other portion is in the middle of the last clause of the contract, a place more obscure than at the top of the writing.

Appellee furnished the supplies until appellant unequivocally refused to accept the same, which was in August, 1918. Appellant did not exercise the option of countermanding the order until after the expiration of the time specified in the contract. In other words, the first request made by appellant for discontinuance of the service was by letter dated March 22, 1918. This letter written by appellant did not claim the privilege of discontinuing the service as a matter of right under the contract, but requested appellee, as a matter of grace, to release appellant from further performance of the contract.

cuit court of Washington county against apAppellee instituted this action in the cirpellant to recover the amount due under the contract, but appellant filed an answer and cross-complaint, alleging false and fraudulent misrepresentations of appellee's agent in -securing appellant's signature to the contract,

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