Coley v. Green

• Court: Arkansas Supreme Court
• Writing for the Court: McFADDIN
• Citation: Coley v. Green, 335 S.W.2d 720, 232 Ark. 289 (Ark. 1960)
• Decision Date: 30 May 1960
• Docket Number: No. 5-2142,5-2142
• Parties: O. T. COLEY et ux., Appellants, v. Doyle S. GREEN et ux., Appellees.

Page 720

335 S.W.2d 720

232 Ark. 289

O. T. COLEY et ux., Appellants, v. Doyle S. GREEN et ux., Appellees.

No. 5-2142.

Supreme Court of Arkansas.

May 30, 1960.

William H. Drew, Lake Village, for appellants.

Spitzberg, Bonner, Mitchell & Hays, Little Rock, for appellees.

McFADDIN, Justice.

This litigation is for the proceeds of insurance money, and arises because a fire damaged the mortgaged premises. Green and wife, as mortgagors, were plaintiffs; and Coley and wife, as mortgagees, were defendants. The Trial Court rendered a decree in favor of the Greens and the Coleys prosecute this appeal.

O. T. Coley and wife owned a combination restaurant, truck stop, filling station, and motel, called 'Twin City Diner', and located near Dermott. In March 1958 Coley sold the entire property and all furnishings to Green. The unpaid balance of the purchase price was $63,000, payable monthly for a number of years, and secured by a first mortgage on the real estate. Green was required to maintain fire insurance policies on the buildings, with loss payable clause in favor of Coley; and this requirement was performed by having policies in four insurance companies, being United States Fidelity & Guaranty Company, Federal Insurance Company, Hartford Fire Insurance Company, and Great American Insurance Company.

In September 1958 a fire materially damaged the two-story building called the 'diner'. The four insurance companies agreed that the total amount to be paid for the fire damage was $12,600. Coley then agreed with Green that the entire insurance money '* * * would be paid over to Mr. Green in the event the property was restored to as good a condition as it was prior to the fire'. The four insurance companies issued and delivered drafts totalling $12,600 payable to Coley. Green undertook the repair work and after he had completed it to his own satisfaction he asked Coley to endorse and deliver the four insurance drafts. Coley refused, claiming that such repair work as Green had done did not restore the building to as good a condition as it was before the fire.

Thereupon Green and wife instituted this suit against Coley and wife and the four insurance companies. The complaint was entitled, 'Petition for Declaratory Judgment'. The four insurance companies claimed that they were mere stakeholders and paid the $12,600 into the registry of the Court by interpleader (§ 27-816, Ark.Stats.) and they were discharged with attorneys' fees and costs. Trial in the Chancery Court resulted in a finding that Green was entitled to all of the $12,600 insurance money; and from that decree Mr. and Mrs. Coley prosecute this appeal, presenting the issues herein discussed.

I. Venue. Appellants raise two points on venue. First, they claim that the Chancery Court did not have venue because of the provisions of Section 301 of Act 148 of 1959 (as now found in § 66-3234, Ark.Stats.). This case was filed in April 1959 and the decree from which comes this appeal was entered on October 26, 1959. Section 697 of Act 148 of 1959 provides that in certain situations, as here, the said Act did not go into effect until January 1, 1960. So there is no merit to this contention of the appellant.

The other phase of the venue claim of the appellants is an attempt to invoke § 27-615, Ark.Stats., which provides that when a defendant is summoned to appear in an action outside his own county and the action is dismissed against codefendants resident of the county in which the action is pending, then, upon proper objection, no judgment can be rendered against the defendant nonresident of the county. The appellants state that the action was filed in Pulaski County; that the Coleys were residents of White County; that when the insurance companies paid the money into the Court they ceased to be parties defendant; and, therefore, the action should have been dismissed as to the Coleys. But the answer to the appellants' contention rests on two facts: (a) the insurance companies were not real defendants but were mere stakeholders and any objection as to venue should have been made before answering; and (b) the answer did not raise the question of venue so the appellants have waived it. The complaint was filed on April 7, 1959. On April 30, 1959 Mr. and Mrs. Coley filed an answer denying all allegations in the complaint and praying, '* * * that the Court order the proceeds herein paid as prescribed in Paragraph 8 of the complaint filed herein * * * and for all other relief to which the proof may show defendants to be entitled'. There was no objection as to venue in the said answer. It was not until May 26, 1959--nearly a month later--that the Coleys first raised any question of venue. The case of Murdock Acceptance Corp. v. Speer, 225 Ark. 948, 286 S.W.2d 485, is ruling here. In a long line of cases this Court has held that a general appearance will subject the defendant to the Court's jurisdiction, even...