Waxahachie Medicine Company v. Daly

• Decision Date: 28 February 1916
• Docket Number: 214
• Citation: 183 S.W. 741,122 Ark. 451
• Parties: WAXAHACHIE MEDICINE COMPANY v. DALY
• Court: Arkansas Supreme Court

183 S.W. 741

122 Ark. 451

WAXAHACHIE MEDICINE COMPANY v. DALY

No. 214

Supreme Court of Arkansas

February 28, 1916

Appeal from Nevada Circuit Court; Geo. R. Haynie, Judge; reversed.

STATEMENT BY THE COURT.

Appellant Medicine Company, a foreign corporation, of the State of Texas, made a contract August 16, 1912, with appellee and his sureties, for the sale of certain medicines to be supplied by it at a certain price delivered to appellee Daly, to be sold by him in Nevada County, and the proceeds accounted for according to the stipulations contained in the contract. Under this contract it delivered to Daly, medicines to the amount of $ 428.38. It had not complied with the requirements of our State laws for admission of foreign corporations to do business, at the time of the execution of said contract, but did comply therewith on the 9th day of August, 1913, and was issued a permit to do business in the State, and on the 15th day of August, 1913, it made another contract in the terms of the first with Daly, with the same sureties, for the sale of its medicines in Nevada County, to December 31, 1913.

Before the making of the second contract, appellee had only paid $ 90.50 on the goods delivered to him under the first contract but had sold a large amount of said goods and the appellant credited him with the amount of money sent in on its charge for goods under the first contract in the sum of $ 277.48 which left a balance it claimed of $ 157.90, due under said contract.

It alleged that it sold him under the second contract $ 439.27 worth of goods and was only paid of said amount $ 20.07 leaving a balance due on both contracts of $ 570.10, the amount sued for.

A copy of the contract was exhibited with the complaint.

Appellee Daly admitted the execution of both contracts; denied that the amount of goods alleged to be, had been delivered to him and that appellant had not been paid more than the amount with which he was credited. Alleged that the goods had been shipped to and received by him under the contract as the agent of the medicine company and distributed among its customers by him in accordance with said company's instructions at the price fixed by it and that at the time the first contract was entered into the plaintiff was a foreign corporation, without right to do business in this State, not having complied with the requirements of its laws for entry for that purpose and was not entitled to enforce the contract.

He denied that the amount of goods charged for had been delivered to him on the second contract and that he had paid only $ 20.07 thereon. Alleged that at the termination of the contract he had on hand $ 57.41 worth of medicine, which he was entitled to return and receive credit for and which he offered to return, but plaintiff refused to receive same that he had on hand outstanding and uncollectible, accounts to the amount of $ 671.15 which he returned to plaintiff at the termination of the contract and upon which he was entitled to a credit under the terms of the contract of 25 cents on the dollar.

He alleged that all credits made on the first contract should be credited upon his account on the second contract, the first being void.

The sureties on his bond filed separate answers, alleging that appellee Daly had failed to comply with his part of the contract with the medicine company, in the way of making reports and payments and that it agreed with said Daly at the beginning of the contract that it should not be complied with; conspired with him and agreed to the violation thereof all of which was unknown to them and of which they had no knowledge until after the suit was instituted and alleged that the loss, if any, sustained by the plaintiff was due to its own negligence and connivance with the appellee to defraud the defendants.

It appears from the testimony that the medicine company shipped to appellee Daly $ 428.38 worth of goods under the first contract, upon which he only paid $ 90.50 to the time of executing the second contract on April 15, 1913. That under the second contract it delivered goods to Daly to the amount of $ 439.27, and was paid on the account only $ 96.46. Daly rendered a statement at the expiration of the last contract Jan. 1, 1914, showing medicine on hand of the value of $ 156.10, and it rendered him a statement claiming a balance due of $ 570.10, which its secretary testified was correct; and that the bondsmen were liable for the full sum less $ 76,88.

Daly admitted that all the goods charged to him by said company had been received except one consignment of $ 48.50. He also stated that he had on hand at the end of the term of the contract of uncollectible accounts $ 671.15, and medicine of the value of $ 57.41. Said he had received goods under the first contract amounting to $ 428.38 and under the second of the value of $ 346.75; that he had paid the company under the first contract, and $ 122.41 under the second, and claimed he was entitled to a credit of twenty five cents on the dollar on the amount of uncollectible accounts, $ 167.78.

The court instructed the jury, giving among others, over appellant's objection, instruction numbered one, as follows:

"If the jury find from the evidence in this case that the first contract, which was entered into on the 16th day of August, 1912, was substituted and taken up by the plaintiff by the execution of the second contract, and that it was not considered by the parties hereto of any more force and effect, then the plaintiff can not recover under the first contract, because it had no authority under the laws of Arkansas to do business in this State."

The jury returned a verdict in favor of the defendants and from the judgment thereon this appeal is prosecuted.

Judgment reversed.

U. A. Gentry and McMillan & McMillan, for appellant.

1. The court erred in refusing to direct a verdict for the plaintiff. When the facts are undisputed, and when different minds cannot draw different conclusions therefrom, it becomes the courts duty to direct a verdict. 57 Ark. 461; 97 Id. 442; 104 Id. 267. Appellee is not entitled to the credits claimed for medicine on hand and uncollectible accounts under the contract and evidence. It is certainly undisputed that Daly still owed $ 335.03, it is shown by his own testimony.

2. The first contract was not void but enforceable. 61 Ark. 1; 70 Id. 525; 72 Id. 327; 77 Id. 203; 25 Am. St. 925; Beale on For. Corp. § 213. A foreign corporation can comply with the law even after suit is brought. 77 Ark. 203; (Fed.) 7 Ann. Cas. 222.

3. Penal statutes are strictly construed. 79 Ark. 517; 66 Id. 472; 64 Id. 284; 59 Id. 355; 56 Id. 45 and 224.

4. A penalty does not change the rule. 61 Ark. 1. The court's instruction on its own motion is misleading.

No brief filed for appellee.

OPINION

KIRBY, J. (after stating the facts.)

It is contended that the court erred in giving said instruction numbered one...