Edwards v. Lodge

• Citation: 113 S.W.2d 94,195 Ark. 470
• Decision Date: 24 January 1938
• Docket Number: 4-4898
• Parties: EDWARDS v. LODGE
• Court: Supreme Court of Arkansas

113 S.W.2d 94

195 Ark. 470

EDWARDS v. LODGE

4-4898

Supreme Court of Arkansas

January 24, 1938

Appeal from Sevier Chancery Court; A. P. Steel, Chancellor affirmed.

Affirmed.

B E. Isbell and Abe Collins, for appellant.

Marion C. Early and Rose, Hemingway, Cantrell & Loughborough, for appellees.

OPINION

MEHAFFY, J.

Ivon Lodge, trustee, and the United Bank & Trust Company, filed a complaint in the Sevier chancery court against Patterson Orchards, Inc., William H. Armstrong, as trustee, Fruit Supply Company and Harry S. Kramer, Jr.

It was alleged that the Patterson Orchards, Inc., was the owner of certain described lands and that on November 1, 1930, it executed four promissory notes for the sum of $ 5,000 each. The notes were made payable to Harry S. Kramer, Jr.; that nothing had been paid on said notes for more than six years. To secure the payment of said notes the said Patterson Orchards, Inc., on the same date, executed and delivered to Ivon Lodge, as trustee for Harry S. Kramer, Jr., and his assigns or holders of the said notes, a deed of trust by which it conveyed to the said Lodge, as such trustee, certain described lands in Sevier county, Arkansas; that the said notes and deed of trust are now held by the United Bank & Trust Company of St. Louis, which acquired the same for a valuable consideration before maturity. On April 20, 1935, the time for payment of the notes was extended to July 1, 1937. It was further alleged that the Patterson Orchards, Inc., had permitted said lands to be sold to the state of Arkansas on November 19, 1935, and because of this breach of the covenants the appellee elected to declare said notes immediately due and payable. The said Patterson Orchards, Inc., on November 1, 1930, executed a deed of trust to William H. Armstrong as trustee for Harry S. Kramer, Jr., to secure an indebtedness of $ 50,192.86. Shortly after making this deed of trust, the said Patterson Orchards, Inc., was put into bankruptcy and a sale was had, and from the proceeds of the sale $ 16,692.86 was applied towards the satisfaction of the deed of trust to Armstrong. On December 1, 1931, the Patterson Orchards, Inc., executed to the Fruit Supply Company a mortgage to secure an indebtedness of $ 10,000; that this deed of trust and the mortgage to the Fruit Supply Company were subordinate to the lien of the deed of trust sought to be foreclosed by the appellee. It was alleged that the property described in the complaint consisted of 771.23 acres. Appellee prayed for the appointment of a receiver and that the lien of appellee be foreclosed and the proceeds of sale applied first to the cost of the suit and second to the satisfaction of the debt due the said United Bank & Trust Company.

B. E. Isbell was appointed attorney ad litem for the nonresident defendants. E. K. Edwards filed an intervention and cross-complaint, alleging that he was the owner and entitled to the possession of certain lands mentioned in appellee's complaint; that he purchased said lands from the state of Arkansas, and the land commissioner made a deed to him. He asked that the deed of trust sued on by appellee be canceled, and that his title be quieted and confirmed.

Abe Collins was appointed attorney ad litem to represent the nonresidents in the intervention.

Appellees filed answer to intervention and cross- complaint alleging that the title in Edwards was void. A reply was filed by the intervener, and to the second paragraph of the reply, appellee filed a demurrer. Edwards acknowledged that the appellee had tendered him $ 211.82, which he had paid to the state of Arkansas.

The chancery court entered a decree holding that the tax title of the appellant was void because the notice of the sale of lands for the taxes of the year 1933 was not given as required by law, but the court held that the appellant was entitled to be paid for tax liens discharged by him in the sum of $ 231.60 and for betterments to the land made by appellant in the sum of $ 176.20. The court also ordered that the deed be canceled and set aside as a cloud upon appellee's title to said land. The court also held that the deed from the state of Arkansas for the second described land should be, and is, canceled and that E. K. Edwards should recover the value of permanent improvements made on the lands and for the tax liens against said lands in the total sum of $ 407.80, and that said sum constituted a lien which was prior and paramount to any right, title, interest or lien of appellee and the defendants.

The following agreed statement of facts was introduced:

"It is agreed that the notice of the tax sale for the taxes of the year 1933, published in Sevier county, was in the following form, and that the certificate of the clerk attached to the copy of said 'Records of Lists Notice of Sales' of said county is in the form attached to said notice and appears in the record immediately thereafter:

"Notice of Delinquent Sale

"The lands and lots and parts of lots returned delinquent in Sevier county for the year 1933, together with the taxes and penalties charged thereon, agreeable to law, are contained and described in a list or record on file in the office of the county clerk; and notice is hereby given to all parties in interest that said several tracts, lots or parts of lots, or so much thereof as may be necessary to pay the taxes, penalties and costs due thereon, will be sold by the county collector, J. M. Sutton, at the court house in said county, on November 19, 1934, unless the said taxes, penalties and costs, as charged thereon, agreeable by law, be paid before that time, and that the sale will be continued from day to day until the said tracts, lots, and parts of lots be sold.

"Witness my hand and seal this 10th day of November, 1934, Lloyd T. Moore, County Clerk, Sevier County."

Under this notice appears the following:

"STATE OF ARKANSAS,

"COUNTY OF SEVIER.

"I, Lloyd T. Moore, clerk of the county and state aforesaid, do certify that the above notice was published in the DeQueen Bee, a weekly newspaper, on the 8th day of November, 1934, and in the DeQueen Daily Citizen, a daily newspaper, on the 16th day of November, 1934, at DeQueen, Sevier county, Arkansas. Witness my hand and official seal, this, the 17th day of November, 1934.

"Lloyd T. Moore, County Clerk."

There was then introduced in evidence a deed from the state of Arkansas to E. K. Edwards, said deed dated January 18, 1937 also deed from the state of Arkansas to E. K. Edwards dated February 25, 1937; also the certificate from the county clerk as to the amount of taxes for which the lands were forfeited, and for taxes that would have accrued against said lands in the...