Rinehart & Gore v. Rowland

• Decision Date: 02 June 1919
• Docket Number: 10
• Citation: 213 S.W. 17,139 Ark. 90
• Parties: RINEHART & GORE v. ROWLAND
• Court: Arkansas Supreme Court

213 S.W. 17

139 Ark. 90

RINEHART & GORE v. ROWLAND

No. 10

Supreme Court of Arkansas

June 2, 1919

Appeal from Boone Chancery Court; Ben F. McMahan, Chancellor reversed.

STATEMENT OF FACTS.

J. Sam Rowland et al., plaintiffs below, appellees here, instituted this action in the circuit court of Boone County, Arkansas against one C. E. Sarber, and Rinehart and Gore, defendants below. Rinehart and Gore are the appellants here.

The plaintiffs alleged in their amended complaint that about the 20th of November, 1916, defendants entered into a contract with plaintiffs whereby defendants agreed and undertook, for a consideration of $ 1,350 cash, to issue to each of said plaintiffs one sixty-fourth interest in certain oil and gas leases covering 2,500 acres of land situated in Boone County Arkansas, and known as the C. E. Sarber leases, and as further consideration defendants agreed to drill a well then being put down on said land from a depth of 2,200 feet to a depth of 3,000 feet without unnecessary delay unless prevented by impossibility. They alleged that Harry Gore was present and was the active man in making said contract, and that he represented that his firm, Rinehart & Gore, were the ones who would do the drilling. He further represented that defendant C. E. Sarber was representing the firm of Rinehart & Gore, and that, while Rinehart & Gore were the owners of said leases, for convenience they had been taken in the name of defendant C. E. Sarber. They allege that for the purpose of wronging, cheating and defrauding plaintiffs Harry Gore as a member of the firm of Rinehart & Gore, induced the plaintiffs to enter into the written contract with defendant C. E. Sarber, well knowing at the time that the said Sarber could not and would not carry out the terms of said contract by drilling said well as they represented it would be drilled; that, for the purpose of wronging, cheating and defrauding plaintiffs, Rinehart & Gore, immediately on payment of the money which the plaintiffs had paid in, converted the same to their own use by placing same in the People's National Bank of Harrison, Arkansas, to the credit of Rinehart & Gore, well knowing that the money had been paid in by these plaintiffs for the purpose of having said well drilled deeper and well knowing at the time of the conversion of said money that Sarber would not be able to drill the well as defendants had induced plaintiffs to believe would be done.

Plaintiffs alleged that it was a fraudulent scheme on the part of Rinehart & Gore to induce plaintiffs to enter into the contract with Sarber, whom defendants represented as holding the property for them. They alleged that Sarber is insolvent, and that Rinehart & Gore knew such to be the fact when they induced plaintiffs to enter into the contract before mentioned.

They alleged that, by reason of the false and fraudulent acts and conduct of the defendants, they were defrauded of the sum of $ 1,350. For which sum with interest they prayed judgment and for all proper and equitable relief. They moved that the cause be transferred to the chancery court of Boone County, which was done, over the objection of defendants.

In the chancery court the defendants moved to dismiss for want of jurisdiction. Thereupon it was agreed in open court that the cause was transferred to the chancery court over the objection of the defendants. The court then overruled the motion to dismiss, to which the defendants duly excepted.

The defendants Rinehart & Gore then answered, admitting that they were partners but denying that they were partners or associated with C. E. Sarber with reference to the matters alleged in plaintiffs' amended complaint. They denied that they had a contract with plaintiffs, and alleged that the plaintiffs had a written contract with C. E. Sarber with reference to the drilling of the well referred to in the amended complaint, a copy of which they made an exhibit to their answer. They alleged that Sarber complied with the terms of that contract, and that plaintiffs breached the same by taking over the well and drilling same without the knowledge or consent of Sarber. They denied that Sarber represented the firm of Rinehart & Gore and denied specifically all the other allegations of the complaint.

The court heard the cause upon the testimony adduced on the issues thus raised, and made a general finding in favor of the plaintiffs, and rendered a judgment in their favor against the defendants Rinehart & Gore for the sum of $ 1,350 with interest from the commencement of the suit, May 5, 1917, to the date of the decree, September 4, 1918, to-wit: in the sum of $ 104.65, making the total amount of the decree $ 1,464.55.

The court further found that the People's National Bank of Harrison, garnishee, had in its hands funds of Rinehart & Gore in an amount sufficient to pay the judgment, and also rendered a decree sustaining the writ of garnishment and directing the bank to pay the plaintiffs the amount of the judgment.

The defendants Rinehart & Gore duly prosecute this appeal. Further facts stated in the opinion.

Decree reversed and cause remanded.

E. G. Mitchell, for appellants.

1. The court erred in overruling defendants' motion to dismiss the complaint because it is vague and uncertain in that it alleges a suit upon a contract without stating whether it was oral or written, and if written it was not made an exhibit.

2. The complaint should also have been dismissed because there was a fatal misjoinder of parties plaintiff.

3. It was error to transfer the cause to chancery over defendants' objection. They were entitled to a trial by a jury at law, and the chancery court had no jurisdiction. No equitable grounds of jurisdiction were stated and appellants did not waive their rights as appellees' complaint stated no cause of action. Appellants were clearly entitled to a trial by jury at law and it was error to transfer to equity.

4. The findings are clearly contrary to the preponderance of the evidence. 46 Ark. 80; 47 Id. 485. The decree should be reversed for a trial at law.

George J. Crump, for appellees.

1. There is no question of novation in this case, nor is the statute of frauds available. It is not pleaded below. 105 Ark. 641; 71 Id. 302; 96 Id. 184; Ib. 505; 56 Id. 267.

2. There was no misjoinder or defect of parties. This question was not raised below and now it is too late. 33 Ark. 497; 93 Id. 351.

3. The court had jurisdiction. Grounds of equitable relief were stated in the complaint. No demurrer was ever filed to the original or amended complaint. Defendants submitted to a trial in chancery, and it is now too late to insist that the case ought to have been remanded to the law courts. 51 Ark. 238-259; 54 Id. 532; 123 Id. 178; 79 Id. 502; 134 Id. 254; 122 Id. 108; 87 Id. 211. The appeal should be dismissed or the decree affirmed on account of the imperfect abstract filed here, which does not comply with the rules of the court. But on the merits of the whole case the judgment should be affirmed, as the evidence sustains it.

OPINION

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

The record shows that the appellants filed in the court below the following motion: "That the...