Holthoff v. State Bank & Trust Company of Wellston, Mo. v. Kersh Lake Drainage District; Fish v. Kersh Lake Drainage District

• Decision Date: 19 March 1945
• Docket Number: 4-7253,4-7380,4-7585
• Citation: 186 S.W.2d 162,208 Ark. 307
• Parties: Holthoff v. State Bank & Trust Company of Wellston, Mo.; Johnson v. Kersh Lake Drainage District; Fish v. Kersh Lake Drainage District
• Court: Arkansas Supreme Court

186 S.W.2d 162

208 Ark. 307

Holthoff v. State Bank & Trust Company of Wellston, Mo.; Johnson v. Kersh Lake Drainage District; Fish v. Kersh Lake Drainage District

Nos. 4-7253, 4-7380, 4-7585

Supreme Court of Arkansas

March 19, 1945

Appeals from Lincoln Chancery Court; Harry T. Wooldridge Chancellor.

Affirmed.

Coleman Mann, McCulloch & Goodwin, for appellants.

Rowell, Rowell & Dickey; Rose, Loughborough, Dobyns & House; Robert A. Zebold and A. F. House, for appellees.

OPINION

McFaddin, J.

All of these appeals are from the Lincoln chancery court, and involve the Kersh Lake Drainage District. The transcripts in the three cases contain 977 typewritten pages, and the briefs contain 1,015 printed pages.

Case No. 7380 is A. J. Johnson et al. v. Kersh Lake Drainage District, and is hereinafter referred to as the "Johnson Case." It is before this court now on the third appeal. The first appeal is in 198 Ark. 743, 131 S.W.2d 620, 132 S.W.2d 658; affirmed by the United States Supreme Court, 309 U.S. 485, 60 S.Ct. 640, 84 L.Ed. 881, 128 A. L. R. 386. The second appeal is in 203 Ark. 315, 157 S.W.2d 39; certiorari denied by the United States Supreme Court, 316 U.S. 673, 62 S.Ct. 1044, 86 L.Ed. 1748.

Case No. 7253 is C. H. Holthoff et al. v. State Bank & Trust Co. of Wellston, Missouri; it is referred to herein as the "Holthoff Case." It is before us now on the second appeal. For the first appeal, see 203 Ark. 315, 157 S.W.2d 39; certiorari denied by the United States Supreme Court, 316 U.S. 673, 62 S.Ct. 1044, 86 L.Ed. 1748.

Case No. 7585 is W. A. Fish et al. v. Kersh Lake Drainage District and State Bank & Trust Co., and is referred to herein as the "Fish Case." It is before us on its first appeal. Distinction is made between the "Fish Case" and the "Fish Decree," because the "Fish Decree" was rendered on June 15, 1932, and has been an issue in each of the previous appeals in each of these cases.

Also, certain angles of these cases were in the federal court. See Kersh Lake Drainage District v. State Bank & Trust Co. (8th C.C.A.), 85 F.2d 643, and Kersh Lake Drainage District v. State Bank & Trust Co. (8th C.C.A.), 92 F.2d 783.

Even though the three cases now before us have never been consolidated by formal order, still they were argued together in this court, and the consideration of two of the cases was delayed until the third was ready for submission. Each of these three cases involves the affairs of the Kersh Lake Drainage District, and stems from either the efforts of some landowners to escape further payments, or the efforts of certificate holders to secure full collection. Because the cases are thus intertwined, we consider the three present appeals, and dispose of them in one opinion. Authority for this procedure may be found in 3 Am. Juris. 342, where, in discussing consolidation of actions on appeal, the rule is stated:

"Of course, the courts of review may, and frequently do, without consolidating cases, hear and determine two or more of them together for reasons of convenience or because of the similarity of the facts or questions involved, or because they grew out of the same controversy or relate to the same subject of litigation, or because the decision of one case will, or may, determine the disposition of the other."

Without stating the facts or holdings on the former appeals in the Johnson case and the Holthoff case, we begin with our opinion of December 8, 1941, reported in 203 Ark. 315, 157 S.W.2d 39. There, this court used one opinion to dispose of both cases, i.e., second appeal in the Johnson case and first appeal in the Holthoff case. A petition for rehearing was filed in which it was urged, inter alia, that the court had used the facts in one case to support the opinion in the other case and had thus committed error. This petition for rehearing was denied. After the United States Supreme Court refused certiorari (April 27, 1942), 316 U.S. 673, 62 S.Ct. 1044, 86 L.Ed. 1748, the clerk of the Arkansas Supreme Court prepared a joint mandate to the Lincoln chancery court on authority of the opinion of this court on the second Johnson appeal and first Holthoff appeal. This joint mandate was resisted by the attorneys for the present appellants; and among other grounds for resisting the joint mandate there was the same claim, as made in the petition for rehearing, that the court had indiscriminately used facts from separate records. This court sustained the action of the clerk in issuing the joint mandate.

When the cases went back to the Lincoln chancery court on the joint mandate the following transpired in each of the cases, and leads to the present appeals:

(A) In the Holthoff case there was:

1. A decree of June 6, 1943, entered on the mandate, setting aside the decree of March 21, 1941, and also setting aside the decree of June 15, 1932, in the case of Fish et al. v. Holthoff (this last was the "Fish Decree").

2. Answer and cross-complaint of Holthoff et al. v. the Bank, et al.; and also a bill of review by Holthoff, et al.

3. Answer of the Bank, et al., and motion to dismiss the matters in 2, above.

4. A hearing on a voluminous record, and a decree by the Lincoln chancery court on July 12, 1943, in which the court found all the issues of law and fact in favor of the plaintiffs (State Bank, et al.). From that decree comes this appeal, presenting, inter alia, these contentions raised by the appellants:

I. The supreme court was in error in its opinion of December 8, 1941, in setting aside the "Fish Decree" against the 54 landowners not named in the complaint filed by the bank against Holthoff, et al.

II. The State Bank & Trust Co. of Wellston, Mo., committed a fraud on the federal court when the bank obtained a judgment against Kersh Lake Drainage District, and therefore this court of equity should refuse any relief to the State Bank.

(B) In the Johnson case there was:

1. A decree entered on June 8, 1942, on the mandate setting aside the decree of July 11, 1940, and restoring the cause to the docket.

2. The 58 defendants (Fish et al.) filed an answer to which there was a response.

3. There was a trial upon a voluminous record; and the learned chancellor rendered a ten-page opinion which is in the record and has proved helpful to this court.

4. A decree was rendered on September 15, 1943, in which the chancery court held that the Kersh Lake Drainage District should have foreclosure of its lien on the lands of the 58 defendants for the delinquent and unpaid assessments -- being those assessments sustained in the second appeal. From that decree comes this appeal presenting, inter alia, the following contentions of the appellants:

III. In the second appeal in the Johnson case the Supreme Court traveled outside the record in that case when it held the "Fish Decree" to be void.

IV. A special levy by the Jefferson circuit court is necessary before interest can be collected on the assessed benefits.

V. Act 467, § 1, of 1919, allowing interest to be charged on assessed benefits, was repealed by Act 285 of 1941.

(C) We turn now to the case of W. A. Fish, et al., v. Kersh Lake Drainage District, which is here on appeal for the first time. It will be recalled that Fish et al. filed suit against the Kersh Lake Drainage District and obtained a decree on June 15, 1932, exempting the lands of the 58 landowners from further payments of benefit and interest. This decree is called the "Fish Decree." When the Lincoln chancery court rendered its decree in the Holthoff case on June 8, 1942, it set aside the "Fish Decree." Thereafter on May 4, 1944, Fish et al. (58 parties) filed a complaint against the Kersh Lake Drainage District and the State Bank & Trust Co. of Wellston, Missouri, to set aside the decree of July 12, 1943, in the Holthoff case (and also the decree of September 15, 1943, in the Johnson case), as having been obtained by fraud. This was a proceeding under § 8246 of Pope's Digest; and its purpose was to leave open for the 58 parties all the defenses they might be able to offer in the suit of the Kersh Lake Drainage District to foreclose the delinquent and unpaid assessments, i.e., those involved in the second Johnson case. The said complaint of May 4, 1944, contained no defenses to the foreclosure suit other than those contentions already listed as issues in these appeals. Since a proceeding under § 8246 of Pope's Digest must not only allege the unavoidable casualty which caused the judgment to be entered, and sought to be set aside, but must also allege the grounds of defense to the original suit; and since no new grounds of defense were alleged in the complaint of May 4, 1944, other than those heretofore referred to as contentions in the Johnson appeal and the Holthoff appeal: it seems to us that a decision of these contentions will give the appellants the full benefits of a trial on the merits.

With this statement, we proceed now to discuss the five main contentions of the appellants, as we have previously listed them.

I. The Appellants Contend that This Court was in Error in its Opinion of December 8, 1941, in Setting Aside the "Fish Decree" Against the Fifty-four Landowners not Named in the Complaint Filed by the Bank Against Holthoff, et al. This contention is amplified by the further contentions:

(a) that the fifty-four landowners were not named in the suit; and

(b) that there was no allegation of fraud committed by any of these individuals.

It will be recalled that there were 58 parties who secured the "Fish Decree" on June 15, 1932, which exempted the lands of each of the 58 from further charges of any kind. The effect of that decree was to release thousands of acres from further liability. The State Bank & Trust Co. brought its first suit (the...