Power v. Howard, 5--6043

• Decision Date: 19 February 1973
• Docket Number: No. 5--6043,5--6043
• Citation: 490 S.W.2d 435,253 Ark. 1052
• Parties: Paul H. POWER, Appellant, v. Eugene W. HOWARD, Appellee.
• Court: Arkansas Supreme Court

Page 435

490 S.W.2d 435

253 Ark. 1052

Paul H. POWER, Appellant, v. Eugene W. HOWARD, Appellee.

No. 5--6043.

Supreme Court of Arkansas.

Feb. 19, 1973.

Henson & Faubus, Little Rock, for appellant.

James L. Sloan, Little Rock, for appellee.

BYRD, Justice.

This litigation arises out of the acquisition by the appellant Paul H. Power and appellee Eugene W. Howard of a 60 acre tract of river frontage near North Little Rock, Arkansas. In the trial court case #72452, Howard alleged a joint venture between himself and Power to acquire the land. Paragraph (b) of the complaint alleged that it was agreed between the parties that Howard was to use his equipment to improve the land and that the rate for this type of improvement would be $20 per hour, one-half of which was to be paid by Power. In this complaint, Howard sought to recover $38,150. In the pleadings, Power admitted the joint venture but denied the agreement to improve the property.

In trial court case #72807 Howard brought suit to recover one-half of the expense of moving and repairing a dredge purchased by the parties to improve the property involved in the other suit. These two suits were consolidated, along with a suit by a corporation controlled by Power against Howard and were heard by the trial court sitting as a jury. The trial court's findings and conclusions were set out in a memorandum opinion as follows:

'This Opinion involves three cases which were consolidated for trial.

In analyzing the evidence submitted we find certain basic and important undisputed facts such as:

(1) Mr. Howard and Mr. Power in August of 1968, acquired approximately Sixty (60) acres of land having substantial river frontage for a consideration of $25,000.00. Each party invested $12,500.00 in said purchase price.

(2) An option to purchase this land was obtained on June 5, 1968, and notification was given to the then owner on July 31, 1968, that such option would be exercised.

(3) Messrs. Howard and Power possessed ambitious ideas for the development of a port facility and shared their optimism with the North Little Rock Port Authority on August 9, 1968. (See Plaintiff's Exhibits 15 and 16 for further documentation.)

(4) On July 5, 1968, in furtherance of their project, the parties purchased a used steel dredge barge from owners located in Farmersville, Louisiana, for the sum of $10,000.00. It was understood that this piece of equipment had to be transported to the local site at a substantial cost and that, upon arrival, certain repairs to same would be necessary. The money used in purchasing the dredge was obtained from Fidelity Savings and Factoring Company. Mr. Power has paid his portion of this indebtedness ($5,000.00) but Mr. Howard has failed to remit his $5,000.00 although he admits owing same.

(5) The relationship of the parties became strained in late September, 1968.

(6) On October 1, 1968, Power and wife indicated their willingness to sell out to Howard for a cash consideration of $50,000.00. As of October 8, 1968, an offer was made by Power to Howard to sell his interest in the land and dredge for $45,500.00 subject to certain conditions. (Defendant's Exhibit 17.)

(7) On December 5, 1968, the parties formally listed the Sixty (60) acre tract for sale with Block Realty Company. The listing price was $250,000.00. In the contract with Block, it was stipulated that a dredge was available as an extra item for $20,000.00 and that a large part of property needs fill, dredge could fill for $1,000.00 per acre.

In the Court's opinion facts set forth in Paragraphs 1 through 4 constitute the relationship of joint venture.

As to cases numbered 72452 and 72807 the facts and figures submitted by plaintiff appear to be inflated and not supported by an important element which I classify as 'accomplishment'.

Too, it is believed plaintiff Howard continued to incur expenses when he knew or reasonably should have known that completion of their proposed project was impossible. The relationship between joint venturers is fiduciary in character and imposes on participants an obligation of loyalty, utmost good faith, fairness, honesty, and full disclosure. The testimony submitted has been carefully scrutinized in the light of these essential elements.

In case No. 72452 plaintiff seeks recovery for one-half of $38,185.00 allegedly expended by him in fulfilling his obligation. Being unable or at least unwilling to completely accept the testimony of plaintiff as to the documentation of such expenditures search of the record was made to determine if therein could be found other evidence of greater probative value. As indicated in Paragraph 7 the parties themselves supplied the answer accepted by the Court wherein they put potential purchasers on notice that 'dredge could fill for $1,000.00 per acre'.

Plaintiff testified that 10 or 15 acres had 'been moved to the center'. I give plaintiff credit for the higher acreage mentioned by him and, therefore, conclude he had an expenditure of $15,000.00. As I construe the pleadings filed in this case for all work done by plaintiff compensible at the rate of $20.00 per hour the defendant would invest into the lands for further improvements the sum of $10.00 for each hour of work performed by plaintiff. Accepting this 2 for 1 ratio to represent the agreement of the parties Mr. Howard would be entitled to a judgment against Mr. Power in the amount of $7,500.00.

In case No. 72807 recovery is sought for one-half of $8,258.74 which again was allegedly expended by plaintiff in transporting the dredge from Louisiana to Arkansas and repairing same upon arrival. These alleged charges have not been allowed in full. I can only say as the trier of fact I find the cost of transportation to be excessive and that the alleged repairs to the dredge are not supported by sufficient substantial evidence to justify the total amount asked by plaintiff. The sum of $5,000.00 has been allowed. It is recognized that the dredge was moved from Louisiana to Arkansas and it is logical to believe that certain repairs were made thereon. Because of these factors judgment will be given Mr. Howard for one-half of this amount, $2,500.00.

In case No. 72149 it is admitted that Mr. Howard owes Fidelity Savings and Factoring the sum of $5,000.00 plus interest. Judgment will be rendered for such sum as might be due after the accrued interest is calculated.'

For reversal, appellant relies upon the following points:

'I. The trial court erred in finding that a joint venture existed.

II. The trial court erred in finding for the appellee when all of the facts...