White River Limestone Products Co. v. Missouri-Pacific R. Co., MISSOURI-PACIFIC

• Court: Arkansas Supreme Court
• Writing for the Court: HARRIS
• Citation: White River Limestone Products Co. v. Missouri-Pacific R. Co., 310 S.W.2d 3, 228 Ark. 697 (Ark. 1958)
• Decision Date: 17 February 1958
• Docket Number: MISSOURI-PACIFIC,No. 5-1453,5-1453
• Parties: WHITE RIVER LIMESTONE PRODUCTS CO., Inc., et al., Appellants, v.RAILROAD COMPANY, Appellee.

Page 3

310 S.W.2d 3

228 Ark. 697

WHITE RIVER LIMESTONE PRODUCTS CO., Inc., et al., Appellants, v. MISSOURI-PACIFIC RAILROAD COMPANY, Appellee.

No. 5-1453.

Supreme Court of Arkansas.

Feb. 17, 1958.

Spitzberg, Bonner, Mitchell & Hays and Beresford L. Church, Jr., Little Rock, for appellants.

Pat Mehaffy and W. A. Eldredge, Jr., Little Rock, for appellee.

HARRIS, Chief Justice.

This is an appeal from a judgment of the Circuit Court of Independence County, rendered summarily on the pleadings, certain stipulations of the parties, and upon the record, without the taking of any testimony.

White River Limestone Products Co., Inc. (hereinafter called White River), Arkansas Real Estate Co., Inc., and United Pacific Insurance Company are the appellants. Arkansas Real Estate owns certain mineral lands at Penter's Bluff, upon which White River has conducted mining operations. United, as surety, executed its bond securing the performance of White River under a track materials lease executed between White River, lessee, and appellee, Missouri-Pacific Railroad Company, lessor. Appellants, White River and Arkansas Real Estate, ¹ instituted this suit against the Missouri-Pacific for damages allegedly suffered from a repossession by the railroad of the track materials covered by the lease, it being asserted that Missouri-Pacific had violated the terms of the lease, under which White River alleged it had been given an option to purchase said materials at the expiration of the lease period. Appellee filed an answer and counterclaim against White River, and cross complained against the insurance company for the expense incurred in repossessing the track materials. Subsequent thereto, appellee filed a Motion for Judgment against White River and United Pacific on the cross complaint, and for judgment for Missouri-Pacific against the complaint of White River and Arkansas Real Estate upon the grounds hereinafter discussed. The trial court found in favor of appellee on the contentions raised, and sustained the Motion for Judgment. From the judgment of the court, comes this appeal.

For reversal, appellants rely upon three points, namely:

I.

The lower court erred in treating the response of the appellants to the appellee's request for admissions as an admission on the part of the appellants that the appellee's cost of repossessing the track materials was $1,350.53.

II.

The lower court erred in its holding that the appellants' action in the filing and subsequent voluntary dismissal of the action in the Chancery Court of Independence County, Arkansas, constituted a waiver of the appellants' right to exercise the option to purchase under the terms of the 'Track Materials Lease'.

III.

The lower court erred in its holding that the measure of the appellants' damages, in accordance with the prayer of the Complaint, could only result in a judgment for $0.00, and that the Complaint therefore failed to state a cause of action.

We proceed to a discussion of each point in the order listed.

I.

Appellee served appellants with a Request for Admission pursuant to Section 28-358, Ark.Stats. which provides, in part, as follows:

'After commencement of an action a party may serve upon any other party a written request for the admission by the latter of the genuineness of any relevant documents described in and exhibited with the request or of the truth of any relevant matters of fact set forth in the request. * * * Each of the matters of which an admission is requested shall be deemed admitted unless, within a period designated in the request, not less than 10 days after service thereof or within such shorter or longer time as the court may allow on motion and notice, the party to whom the request is directed serves upon the party requesting admission either (1) a sworn statement denying specifically the matters of which an admission is requested or setting forth in detail the reasons why he cannot truthfully admit or deny those matters or (2) written objections on the ground that some or all of the requested admissions are privileged or irrelevant or that the request is otherwise improper in whole or in part, together with a notice of hearing the objections at the earliest practicable time. * * *'

The Request for Admission included eight different items, the first being as follows: 'That the total costs of defendant, Missouri-Pacific Railroad Company's repossession of the materials covered by Exhibit 'A' attached to the Complaint and Cross-Complaint was $1350.53, itemized as follows: * * *.' Number 2, 3, 4, 5, 6, 7, and 8 were objected to on the grounds that they were wholly immaterial and irrelevant to the issue. To Number 1, appellant answered, 'Plaintiffs are without knowledge of the correctness or exactness of defendant's request Number 1 as to costs of repossessing materials as per Exhibit 'A'. We hold the court's action in ruling that this response, in effect, amounted to an admission insofar as item one is concerned, was correct. The statute requires a sworn statement denying specifically the matters of which an admission is requested, or setting out in detail the reasons why same cannot be admitted or denied, or written objections thereto. The response was not sworn to, and we are of the opinion that this requirement is mandatory. ² Our own U. S. District Court for the Western District of Arkansas has so held. In Sieb's Hatcheries, Inc., v. Lindley, 13 F.R.D. 113, 118, the court quotes from Barron & Holtzoff's Federal Practice and Procedure, Volume II, page 542, as follows:

'Affirmative action is required to avoid the requested admissions and if no answer or response is made within the time prescribed by the request, the facts in the request are deemed admitted. To avoid an unintended admission there must be, therefore, either a sworn statement denying specifically the matters as to which an admission is requested or setting forth in detail why those matters cannot be truthfully admitted or denied, or timely written objections.'

In the case of Beasley v. United States, D.C., 81 F.Supp. 518, 528, is found this language:

'To may mind the prevision that the answers shall be verified is not a mere technicality and the failure to comply strictly with the requirement is not a mere oversight which can be waived or brushed aside. It is a very important and vital part of the procedure * * *.'

Nor does it appear that the present failure to verify the response was an oversight, since appellants make mention in their brief of the provision found in Section 28-359, in which it is provided that if the respondent presents a sworn denial of the truth of a matter of fact, and the party making the request proves such truth, the respondent may be required to pay the expense incurred in the making of such proof, plus reasonable attorney's fees. The action of the court did not constitute error.

II.

On November 17, 1955, White River and Arkansas Real Estate Company instituted a suit against appellee in the Independence County Chancery Court, alleging the option of White River to purchase the track materials and their desire to purchase said materials for the fair market value. It was alleged that appellee refused to sell the materials as agreed in the lease, and was threatening to repossess same. A temporary injunction, restraining Missouri-Pacific from repossessing said track materials until such time as the fair market value could...