Action by Arthur R. Smith against the Jefferson Standard Life Insurance Company. Judgment for plaintiff, and defendant appeals. Reversed and remanded. 305; Porter v. Mutual Life Ins. Co. of N. Y., 70 Vt. 504, 41 Atl. 970. [2] But inasmuch as the insured died before the year had expired, the incontestable Fuhr & Futrell, of Paragould, for appel-suit was not brought until after the first anclause did not apply, and the fact that the lant. Jeff Bratton, of Paragould, for appellee. SMITH, J. On April 15, 1920, the appellant insurance company issued and delivered to appellee Smith, as beneficiary, a policy of insurance for $1,000 on the life of Smith's wife. The application for the policy of insurance contained certain answers to questions which, by the recitals of the application, were declared to be material by the company in determining whether or not a policy would issue, and, among others, that the applicant had never suffered from any ailment or disease of the skin. The policy, when issued, contained an incontestable oneyear clause reading as follows: "After this policy shall be in force for one full year from the date hereof it shall be incontestable for any cause except for nonpayment of premiums." as we have said, the rights and liabilities of niversary of the policy is unimportant, for, the parties under the insurance contract had been fixed by the death of the insured. The court should not, therefore, have directed a verdict, but should have submitted the question of the alleged breach of the waranty, the law of which question has been announced in many cases. For the error indicated, the judgment is reversed, and the cause remanded for a new trial. WILSON v. OVERTURF. (No. 204.) (Supreme Court of Arkansas. March 5, 1923. Rehearing Denied April 2, 1923.) 1. Garnishment 178, 181- Final judgment may be rendered against garnishee upon default or on trial when indebted to defendant in original judgment. Under Crawford & Moses' Dig. § 4916, final The insured died on March 5, 1921, and on April 13, 1921, the company brought suit in the chancery court to cancel the policy on the ground that its issuance had been pro-judgment may be rendered against a garnishee cured by the fraud of the insured, in that she had suffered from a disease of the skin, to wit, pellagra, but had falsely and fraudulently denied that fact in her application. It will be observed that the suit to cancel was brought two days before the expiration of the year after the issuance of the policy, but slightly more than a month after the death of the insured, as the suit on the pol-3. Judgment icy was commenced June 30, 1921. upon default made by him, or when on trial The chancery court transferred the suit to cancel to the circuit court over the company's objection, and it was there consoli-a dated with the suit on the policy, to which action the company also objected and excepted. At the trial of the cause conflicting testimony was offered as to whether Mrs. Smith had pellagra, and as to her answers made to the examining physician in regard thereto; but at the conclusion of all the testimony the court directed the jury to return a verdict for the beneficiary, on the ground No special form of 18(2)-Decree based on complaint not stating good cause of action er roneous. A decree in a garnishment proceeding upon complaint alleging that plaintiffs are informed fendant in a certain sum, and that he has monand believe that garnishee is indebted to deey, property, and effects belonging to defendant, is not based upon a complaint which shows a good cause of action under Crawford & Moses' Dig. § 1187, and is therefore erroneous. 4. Judgment default on mits only the allegations of the complaint, and, if they are insufficient to support the judgment, 101(1)—Judgment rendered by insufficient pleading reversed. A default after due service of summons ad it will be reversed. Appeal from Crittenden Chancery Court; Archer Wheatley, Chancellor. Suit by H. C. Overturf, trustee, against N. that a year had expired before the suit thereon was brought. Judgment was rendered accordingly, and the company has appealed. [1] Instead of transferring the suit to cancel the policy to the circuit court, that suit should have been dismissed, for the reason that the death of the insured fixed the rights C. Wilson, administrator, substituted for and liabilities of both the insurer and the B. W. McCulloch, deceased. From a decree insured. Joyce on Insurance, § 1650b; Ameri- by default against deceased as garnishee, can Employers' Liability Ins. Co. v. Fordyce, the substituted defendant appeals. Reversed 62 Ark. 562, 36 S. W. 1051, 54 Am. St. Rep. and remanded. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes (248 S.W.) This is an appeal by a garnishee from a the interrogatories exhibited against him, decree by default against him. H. C. Over- the court before whom the matter is pendturf, trustee, for the use and benefit of Aar- ing shall enter judgment against such garon McMullin, brought suit in equity against nishee for the full amount specified in the Mrs. Charles Eddins Owen and Mrs. I. I. | plaintiff's judgment against the original deBiles to foreclose a deed of trust on certain fendant, together with costs. Under this lands in Crittenden county, Ark., given by act final judgment may be rendered against Mrs. I. I. Biles to secure an indebtedness a garnishee upon default made by him, or of $7,000 owed by her to Aaron McMullin. when on trial the court finds that he is inThe complaint alleges that Mrs. I. I. Biles debted to the defendant in the original judgsold the mortgaged land to Mrs. Charles ment. Norman v. Poole, 70 Ark. 128, 66 S. Eddins Owen, and that the latter is now W. 433; Tiger v. Rogers Cotton Cleaner & in possession of it; that she is allowing Gin Co., 96 Ark. 1, 130 S. W. 585, 30 L. R. the land to grow up in noxious weeds and A. (N. S.) 694, Ann. Cas. 1912B, 488. undergrowth, and that there has been a failure to pay the mortgage indebtedness or any part thereof. The complaint also contains allegations as follows: "Plaintiffs are informed and believe that B. W. McCulloch is indebted to the defendant Mrs. I. I. Biles and Mrs. Charles Eddins Owen in the sum of $11,775; that he has money, property, or effects belonging to the defendant Mrs. I. I. Biles of the value of $11,775; and plaintiffs propound to the said B. W. McCulloch the following interrogatories, to wit: "First. Are you indebted to Mrs. I. I. Biles of Memphis, Tenn., and Mrs. Charles Eddins Owen, and, if so, state the amount of such indebtedness, the nature thereof, whether evidenced by a promissory note, and, if so, whether said notes are secured by mortgage or deeds of trust? State fully. "Second. Have you in your possession or under your control any moneys, goods, chattels, or effects of Mrs. I. I. Biles of Memphis, Tenn., and Mrs. Charles Eddins Owen, and, if so, state the nature of the same and the value thereof." In the instant case judgment by default was rendered against the garnishee. The only question raised by the appeal is whether the allegations of the complaint are sufficient to support the decree entered upon the default of the garnishee. Koons v. Markle, 94 Ark. 572, 127 S. W. 959, and cases cited. It is claimed by counsel for the garnishee that the complaint is defective in that it did not charge as a fact that McCulloch was indebted to the defendants. [2] It will be noted from our statement of facts that the complaint only alleges that plaintiff is informed and believes that B. W. McCulloch is indebted to the defendants in the sum of $11,775. We think the defect is fatal unless this form of pleading is allowed by our Code. There is no special form of pleading required in garnishment proceedings, and we must therefore look to our general Code provisions on the question. [3] Under section 1187 of Crawford & Moses' Digest the complaint must contain a The complaint prays for a foreclosure of statement in ordinary and concise language, the mortgage, and also for a writ of garnish- without repetition of the facts constituting ment against B. W. McCulloch. A writ of the plaintiff's cause of action. This progarnishment was duly issued and personal vision requires that the facts relied upon service was duly had upon B. W. McCulloch. should be directly and positively alleged, On final hearing of the case there was a de- and not stated by way of argument, infercree of foreclosure in behalf of the plain-ence, or belief. The statute requires the tiff against Mrs. I. I. Biles and Mrs. Charles Eddins Owen, and a personal judgment was rendered against them for the amount of the mortgage indebtedness. A decree by default against B. W. McCulloch as garnishee was also entered in the sum of $8,014.30, being the amount for which judgment was rendered against Mrs. I. I. Biles and Mrs. Charles Eddins Owen. Subsequent to the rendition of the decree B. W. McCulloch died intestate, and an appeal to this court has been duly prosecuted by the administrator of his estate. facts to be alleged so that an issue may be made thereon. The statement in the pleadings should be made in direct and positive terms, so that, if it be necessary for the other party to respond to them, he may be able to do so in terms equally direct and positive. The issue tendered by the complaint is not as to the existence of the fact of whether or not the garnishee was indebted to the defendant, but as to the plaintiff's information and belief on this matter. Therefore the decree was not based upon a complaint which showed a good cause of action, Berry & Wheeler, of Marion, for appel- and was erroneous. lant. [4] A default after due service of sum J. F. Gautney, of Jonesboro, for appellee." mons admits only the allegations of the com HART. J. (after stating the facts as above). [1] Section 4916 of Crawford & Moses' Digest in effect provides that, if any garnishee upon whom personal service has been had shall neglect or refuse to answer plaint, and, if they are insufficient to support the judgment, it will be reversed. Chaftin v. McFadden, 41 Ark. 42; Benton v. Holliday, 44 Ark. 56; American Freehold Land Mortgage Co. v. McManus, 68 Ark. 263, 58 S. W. 250. Brokers 88(10) - Instruction Ignoring claim of plaintiff for commissions if sale made through subagent properly refused. As supporting the views herein expressed, 14. see, also, Nichols & Sheppard Co. v. Hubert, 150 Mo. 620, 51 S. W. 1031, where the Supreme Court of Missouri held that a peti- In an action wherein plaintiffs claimed tion in a creditor's suit, which avers that that a commission was to be paid, not merely plaintiff is informed and believes certain if they found and introduced a purchaser to facts thereafter recited, which are essential whom a sale was made, but was also to be paid to plaintiff's case, is demurrable, as it does chaser with whom defendants traded, it was if one of plaintiffs' subagents found a purnot allege the existence of the facts. proper to refuse defendants' instruction that, It follows that the decree must be revers-if defendant listed land with plaintiffs for sale ed, and the cause remanded for further pro- or exchange, he would not be precluded from ceedings in accordance with the principles making a direct sale nor liable to them for a of equity, and not inconsistent with this commission therefor unless they, by finding and opinion. introducing a purchaser to whom sale was made, were the procuring cause of the sale. GILLETTE & ENGLISH v. CARROLL & HO- (Supreme Court of Arkansas. March 12, 1923.) 1. Brokers 55(1)-Refusal of instruction that broker could not be considered procuring cause of exchange negotiated by another held error. In action for commissions for procuring an exchange of defendant's land, it was error to refuse an instruction that, if it was found that defendants mailed description of the land to plaintiffs, and plaintiffs' mailed copies thereof to other agents, among them L., to find who might have property and through them make an exchange, and explained the arrangement to defendants, and thereafter L. notified plaintiffs that he had certain property of another for exchange, and plaintiffs took one of the defendants to L. to make the exchange, and plaintiffs then, representing defendants, endeavored to make an exchange, but the sale was not made, and L. told such defendant he would try to get other property to exchange, and afterwards procured other property which was subsequently exchanged for defendants' while L. was acting as agent for the other owner, and that neither L. nor plaintiffs notified defendants that plaintiffs were having anything to do with bringing about the exchange, and plaintiff's only kept informed through L. as to its progress, plaintiffs could not be considered as the procuring cause of the exchange, and were not entitled to a commission. 2. Brokers 55(1), 65(4)-One entitled to know which principal agent professes to represent. One is entitled to know who his agent is, and who is the procuring cause in a sale or exchange of property, and, if there is a divided allegiance, he is entitled to know which principal the agent professes to represent. 3. Brokers 65(4)-Agent representing two principals compensated only after full disclosure to each. An agent who represents an adversary principal also can recover compensation for services only when there has been a full disclosure to each of all the facts. Appeal from Circuit Court, Benton County; W. A. Dickson, Judge. Action by Carroll & Hogan, partners, against Gillette & English. Judgment for plaintiffs, and defendants appeal. Reversed and remanded. McGill & McGill, of Bentonville, for appellants. Lee Seamster, of Fayetteville, for appellees. SMITH, J. Gillette and English owned a ranch in the state of Oklahoma, with certain personal property thereon, which they decided to sell or exchange, and with that purpose in view they prepared a circular letter descriptive of their property, which they mailed to a large number of real estate agents. One of these letters was received by Carroll and Hogan, partners as Carroll & Hogan, residing at Bentonville, in this state, and engaged there in the real estate business. Gillette represented himself and English in the transaction out of which this litigation arose; and Carroll represented himself and Hogan. Carroll testified that he and Gillette met and discussed the letter, and Gillette listed the ranch with him to be sold or exchanged; and he told Gillette that he would list the ranch with a number of subagents who were co-operating with him in selling and in exchanging lands, and that if he, or any of those subagents, negotiated a sale or an exchange of the ranch, he would expect a commission of 21⁄2 per cent., and Gillette assented and agreed to pay the commission. Among the other real estate brokers notified by Carroll of this arrangement was R. C. Leeper, of Springdale, Ark., who agreed to find a purchaser or some one with whom an exchange could be made, and Carroll accompanied Gillette to Springdale and introduced him to Leeper as a man who would negotiate a sale or exchange, and some time thereafter, and pursuant to this understanding, Leeper found one McClinton, with whom Gillette made an exchange for the property For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes thereafter no one acted for either Gillette or McClinton; but, when the exchange between them was closed, McClinton paid him the agent's commission agreed upon. of McClinton, and a commission is claimed | himself took charge of the negotiations, and on the theory that, by virtue of the introduction of Gillette to Leeper, Carroll & Hogan thereby became the procuring cause of any sale or exchange of the ranch to any customer Leeper might find and himself represent in making a purchase or exchange for the ranch, although Carroll & Hogan might have nothing else to do towards bringing about the sale or exchange. The theory of the case was that Leeper could be, and was to be, the agent of Carroll & Hogan to procure a purchaser for Gillette, and also to be the agent of such purchaser in making an exchange with Gillette. Shortly before the consummation of the exchange with McClinton, Carroll wrote to Gillette that, if he (Gillette) traded with McClinton, a commission would be expected on the theory stated above. The deal with McClinton was closed, and Gillette refused to pay a commission, and this suit was brought to recover it, and there was a judgment as prayed from which is this appeal. Carroll did not claim to have an exclusive agency, or any agency for any given time, and the right of Gillette to make the sale was not questioned. The insistence is that Gillette promised to pay a commission if Carroll & Hogan themselves, or if they through one of their subagents, negotiated a sale or an exchange; and this latter thing they did through Leeper. Gillette testified that Carroll was never at any time his agent, and had no more right to claim a commission than any one of the other hundred or more real estate brokers to whom he sent his circular letter, which was nothing more than an inquiry whether any of the persons to whom the circular was sent had a customer who might become interested in purchasing or trading for the ranch. He testified that for a period of several months negotiations proceeded between himself and Leeper, and, so far from ever being advised that Leeper was his agent and was attempting to procure him a purchaser, he at all times regarded Leeper as his adversary, with whom he was trading at arm's length. He denied that Leeper told him that Carroll was expecting a commission if the McClinton deal went through. He admitted receiving the letter fom Carroll & Hogan in which they stated they would expect a commission if the McClinton deal was made; but he dismissed it from consideration on the ground that there was no agreement to support the claim. [1] An instruction numbered 2 was asked by the defendants, which, in our opinion, should have been given, but which the court refused. It reads as follows: The court submitted the case to the jury under instructions to find for the plaintiffs if the facts were found to be as contended by "If you find from the evidence that defendCarroll; and we think no error was commit- ants mailed a description of their property to plaintiffs for sale or exchange, and that the ted in so doing, as one may agree to pay com- plaintiffs thereupon made out copies of such missions for services of almost any char-description and mailed them to other real esacter. At least, there is no legal objection tate agents in Benton county and other counto his doing so. It is insisted, however, that the instructions did not properly present the theory of Gillett's defense; and we think that contention is well taken. ties, and, among others, R. C. Leeper, a real estate agent at Springdale, Ark., for the purpose of finding other agents who might have property of others for sale or exchange and 'to ant's property through a deal with such other enable them in that way to exchange defendreal estate agents for property which they might have for exchange, in which case each agent would collect the commission from his own client, and that plaintiffs explained this The testimony shows that Carroll accompanied Gillette to Springdale and introduced Leeper and Gillette, and Carroll endeavored to exchange the ranch for a hotel owned by a customer of Leeper, but this deal failed; and thereafter Carroll admittedly did noth-arrangement to the defendants, and thereafter ing further towards selling or exchanging the ranch except in so far as Leeper represented the firm of which Carroll was a member. tain property of one Hart in Springdale for exsaid Leeper notified plaintiffs that he had cerchange, and that plaintiffs thereupon took defendant Gillette to Springdale for the purpose of endeavoring to make such exchange, and inLeeper testified on behalf of the plaintiffs; troduced him to Leeper, and that plaintiffs then and it is quite obvious from a reading of representing the defendants endeavored to his testimony that he was highly friendly make an exchange of their property, but that to the plaintiffs. He testified that he told the sale was never consummated, and that Gillette that Carroll would expect a com- Leeper then told Gillette he would endeavor mission if the McClinton deal was consumto get other property for exchange for his mated; yet he admitted that in all his nego had the property of one McClinton for exranch, and afterwards notified Gillette that he tiations with Gillette he was representing change for other property and to come down to McClinton, and that Gillette was without Springdale, and that Gillette went down to representation. He further testified that Springdale, and Leeper introduced him to Mcthe McClinton deal hung fire for a period Clinton and entered into negotiations with him of several months, and finally McClintonas McClinton's agent for the exchange of Mc Clinton's property for the ranch of defendants, and that Leeper and McClinton finally carried through a deal with Gillette for the ranch of defendants, that neither Leeper nor plaintiffs notified defendants that plaintiffs were having anything to do with the negotiations for said deal, and that plaintiffs did not, in fact, do or offer to do anything whatever toward bringing about or procuring the exchange for McClinton's property, but only kept informed through Leeper of the progress of the deal, of which fact defendants were not notified, then I charge you that plaintiffs could not be considered in law as the procuring cause of the exchange which was finally consummated by Gillette himself with Leeper and McClinton, and plaintiffs would not be entitled to a commission, and you will find for the defendants." This instruction is open to the objection that it is rather long; but it is not at all obscure and is a concrete statement of the defendants' contention, and we think should have been given. It is true Leeper's testimony connects with that of Carroll and corroborates Carroll's contention that a commission was promised and would be expected if he (Leeper) was instrumental in closing the McClinton deal; and we know of no legal reason why a property owner should not be held bound by an agreement of that character, if he made it. But this instruction declares the law to be that Gillette was entitled to know who was assuming to act for him, or who his agents were, and that he would not be bound unless he was so advised. compensation for such services when there has been a full disclosure to each principal of all the facts. Murphy v. Willis, 143 Ark. 1, 219 S. W. 776; Featherston v. Trone, 82 Ark. 381, 102 S. W. 196; Taylor v. Godbold, 76 Ark. 395, 88 S. W. 959. We conclude, therefore, that the instruction set out above should have been given. [4] An instruction numbered 1 was requested by the defendants, which reads as follows: "If you find from the evidence that defendants listed their ranch with plaintiffs for sale or exchange, this would not preclude the defendants from making a sale or exchange of the property themselves, and they would not be liable to plaintiffs for a commission if they made such sale, unless plaintiffs by finding and introducing a purchaser to whom the sale was made were the procuring cause of the sale." This instruction would be a correct declaration of the law except for the fact that it leaves out of account the contention of the plaintiffs that a commission was to be paid not merely if plaintiffs found and introduced a purchaser to whom a sale was made, but a commission was also to be paid if one of plaintiffs' subagents found a purchaser with whom defendants traded; and for that reason it was properly refused. For the error in refusing to give instruction No. 2, set out above, the judgment is reversed, and the cause remanded. GURLEY Y. STATE. (No. 209.) (Supreme Court of Arkansas. March 5, 1923. Rehearing Denied. April 2, 1923.) 1. Embezzlement held not at variance. 35-Indictment and proof Here, according to plaintiffs' contention, Leeper was acting in a dual capacity. He was McClinton's agent without question; and, according to Leeper's own testimony, was assuming to act for no one else. As such, Leeper no doubt talked up McClinton's property, and talked down that of Gillette. Certainly loyalty to McClinton required him to endeavor to induce Gillette to make the concessions necessary to get the parties together on a trade. As we have said, Gillette had the legal right to contract to pay a commission for the service of having an adversary in a trade produced with whom he might $800 in the form of a check for E. T. F., remake a trade, and under the case of Meyerceived credit therefor at the bank, and exv. Holland, 116 Ark. 271, 171 S. W. 893, a pended same for private uses, held, that there person is liable who does so contract when was not a variance between the indictment and a purchaser is produced. proof. [2] But, we say again, one is entitled to know who his agent is, and who is the procuring cause in a sale or an exchange of property; and, if there is divided allegiance, he is also entitled to know which principal the agent is professing to serve. Where the indictment charged embezzlement of "$800 gold, silver and paper money of the value of $800, property of said E. T. F.," and the proof showed that the company which accused owned and managed had collected 2. Criminal law 304 (2)—Common knowledge banks deal in money only when giving depositors credit. It is common knowledge that banks deal in money only when giving credit to their depositors. 3. Embezzlement 44(2)—Evidence held sufficient to establish felonious intent. [3] The law does not look with favor upon contracts of agency where one agent assumed to represent the adversary principal in a contract of any kind, and only permits Evidence in an embezzlement prosecution an agent who has done so to recover his held sufficient to establish felonious intent. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes |