Frauenthal & Schwarz v. Bank of El Paso

• Decision Date: 01 February 1926
• Docket Number: 141
• Citation: 280 S.W. 1001,170 Ark. 322
• Parties: FRAUENTHAL & SCHWARZ v. BANK OF EL PASO
• Court: Arkansas Supreme Court

280 S.W. 1001

170 Ark. 322

FRAUENTHAL & SCHWARZ v. BANK OF EL PASO

No. 141

Supreme Court of Arkansas

February 1, 1926

Appeal from White Chancery Court; John E. Martineau, Chancellor affirmed.

THE STATEMENT OF FACTS.

The Bank of El Paso brought this suit in equity against J. E Baxter, Rose Baxter, his wife, and Frauenthal & Schwarz to recover a personal judgment against J. E. Baxter on a promissory note in the sum of $ 797.74, with the accrued interest, and to foreclose a mortgage on real estate and on personal property given to it by said Baxter to secure said indebtedness, and judgment against Frauenthal & Schwarz for $ 150, the alleged value of a bale of cotton purchased by them and covered by the personal property mortgage above referred to.

Judgment was rendered against J. E. Baxter for the amount sued for and a decree of foreclosure of the real and personal property mortgaged was entered of record. No appeal was taken from the decree in this respect.

On the branch of the case against Frauenthal & Schwarz, R. A. Kent cashier of the Bank of El Paso, was the principal witness for it. According to his testimony, on the 25th of November 1922, J. E. Baxter executed to the Bank of El Paso, to secure a past indebtedness due it, and for supplies to be furnished him during the year 1923, a chattel mortgage on certain personal property consisting of mules, cows, two wagons, plow tools, and all the crop of cotton which should be grown and cultivated by J. E. Baxter, including all rents and share crops which he might have interest in on his farm and elsewhere in White County, Arkansas, during the year 1923. This mortgage contained a clause as follows:

"And the party of the first part does hereby warrant and guarantee to the party of the second part that no member of the family of the party of the first part nor any other person has any interest whatsoever in any of the above described property, and that no member of the family of the party of the first part has nor will have any claim or lien on or against any of the above described crop or property, for labor or otherwise."

Frauenthal & Schwarz got one bale of cotton raised by J. E. Baxter in 1923, in White County, Arkansas, and the cotton was worth $ 130.35.

E. L. Baxter, a son of J. E. Baxter, nineteen years old, was a witness for the defendants. According to his testimony, the bale of cotton in question weighed 395 pounds, and was sold by him to Frauenthal & Schwarz in payment of a debt he owed them. He had bought a buggy from Frauenthal & Schwarz, and gave them a mortgage on his crop for the purchase price. When he gathered the bale of cotton in question, he turned it over to them. The witness did not have any land rented for that year, but, in the spring of 1923, he made an agreement with his father and brother and Mr. Kent that he was to make and help gather his father's crop and have for his services the cotton grown on ten acres of the land. His father had about forty acres planted in cotton that year. This agreement was before the cotton crop was planted.

According to the testimony of J. E. Baxter, his son E. L. Baxter had been working for himself since he was sixteen years old. The father had emancipated both of his boys, and they had been working for other people. The witness had somewhere around forty or fifty acres in cotton, and was not able to secure help to work all of it. R. A. Kent, for the Bank of El Paso, agreed that the witness might hire his son, E. L. Baxter, to help work and gather the crop, and in payment of his services give him the cotton grown on ten acres. The witness was to feed his son, and his son to clothe himself. Pursuant to this agreement, E. L. Baxter worked in the crop all of the season and helped to make and gather it. The bale of cotton sold by E. L. Baxter was grown on the ten acres set apart to him in payment for his services in making and gathering the crop. All of the crop grown on the remaining part of the land was turned over to the Bank of El Paso and applied toward the discharge of the indebtedness of J. E. Baxter. Henry Baxter, another son of J. E. Baxter, corroborated in every respect the testimony of his father and brother.

R. A. Kent denied having entered into an agreement whereby E. L. Baxter was hired to help make and gather the crop grown by his father, J. E. Baxter, and denied having released the mortgage of the Bank of El Paso on any part of the crop grown by J. E. Baxter in White County during the year 1923.

It was also shown that E. L. Baxter carried the cotton from the farm of J. E. Baxter in the night time and sold it to Frauenthal & Schwarz the next day.

The chancellor found the issues on this branch of the case in favor of the plaintiff, and it was adjudged that the Bank of El Paso recover from the defendants, Frauenthal & Schwarz, the sum of $ 130.35. To reverse this part of the decree, Frauenthal & Schwarz have only prosecuted an appeal to this court.

Decree reversed, and cause remanded. Rehearing granted and decree affirmed.

R. W. Robins, for appellants.

Brundidge & Neelly, for appellee.

OPINION

HART, J., (after stating the facts).

A father can make a valid gift of his minor son's services to himself so as to be beyond reach of his father's creditors. Bobo v. Bryson, 21 Ark. 387; Fairhurst v. Lewis, 23 Ark. 435; Vance v. Calhoun, 77 Ark. 35, 90 S.W. 619; and Biggs v. St. L. I. M. & So. Ry. Co. 91 Ark. 122. An insolvent father may emancipate his minor child, even as against his creditors, and although the child remains at home and is hired by the father. 20 R. C. L., pp. 610 and 611; Wilson v. McMillan, 62 Ga. 16, 35 Am. Rep. 114, and case note at p. 117; McCloskey v. Cyphert, 27 Pa. 220; Beaver v. Bare, 104 Pa. 58, 49 Am. Rep. 567 and cases cited; Wright v. Dean, 79 Ind. 407; Hall v. Hall, 44 N.H. 293; McDaniel v. Parish, 4 App. D.C. 213.

While the general rule is that a father is legally entitled to the services of his minor child, it is equally well settled that a parent may voluntarily relinquish the right to his child's earnings and may permit the child to receive and appropriate his earnings at pleasure. Where the father has emancipated his child, he is under no legal obligation, although he be insolvent, to claim such earnings for the benefit of his creditors. Therefore, the father may himself contract to employ and pay the child for his services and be bound in consequence like any stranger to fulfill his agreement.

But it is claimed that this principle has no application to the facts in the case at bar, because the cotton in question was covered by the mortgage given by the father to the Bank of El Paso. While this is true, the bank had a right to release or waive its mortgage on a part of the crop, and this is what ...