Collie v. Coleman

265 S.W.2d 515, 223 Ark. 206, 1954 Ark. LEXIS 638
CourtSupreme Court of Arkansas
DecidedFebruary 22, 1954
Docket5-291
StatusPublished
Cited by2 cases

This text of 265 S.W.2d 515 (Collie v. Coleman) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Collie v. Coleman, 265 S.W.2d 515, 223 Ark. 206, 1954 Ark. LEXIS 638 (Ark. 1954).

Opinions

Ward, J.

The question raised on this appeal is: Are tenants entitled to a refund from cotton ginned by a Cooperative Gin Company, organized under Act 153 of 1939, where a profit is shown and where the rent contracts contemplate no such payments. The tenants here seek to reverse a decree against them.

Appellee, Charles R. Coleman, controls and rents a large body of cotton land, part of which he owns and the rest he controls as trustee. He is also a stockholder in the Little River Cooperative Gin Company which was organized in 1946 pursuant to said Act 153, and which cooperative will be hereinafter referred to as Little River. Fourteen of the appellants raised cotton on lands rented from Coleman for the years 1946, 1947, 1948 and 1949, agreeing to pay as rent one-fourth of the cotton produced. The three remaining appellants were sharecroppers for the same years under John Lott who was in turn a lessee of Coleman. All cotton raised by all appellants was ginned by Little River, and it is appellants’ contention that they are entitled to a refund or patronage payments of their proportionate share of the profits realized by Little River for eaeh of said years. The amount of refund due, if any is due, to each appellant is set out in evidence and is not questioned by Coleman or Little River. Practically all the essential facts are undisputed except on one point which, for clarity of this opinion, we discuss first.

Rental Contracts. The contention is made by appellees that when the rent contracts with appellants were made it was agreed to and understood by all the renters that they were not to receive any refund or patronage. It appears from the record that Little River had not been incorporated when the rental arrangements were made for the year 1946. No written contracts were introduced but there is testimony that Coleman told the renters they would not get any refunds from the cotton ginnings. However, the effect of this testimony was that the renters were told they could receive refunds by making certain payments.

“Q. What agreement did you have with your various tenants pertaining to this; between you and the various plaintiffs who are plaintiffs in this case, with reference to patronage dividends?
“A. I told them at the beginning, when we started to talk about a gin and before the completion and organization, that if they wanted to share in the profits from the gin they would be allowed to take out stock on the same basis I took out stock. At that time we had not gone very far in making plans and thought we would have to put up $20 for each acre of cotton, and I told them that if they wanted to share in the profits if they would put up their $20 per acre they would be allowed to become members and share in the dividends; otherwise I would take the patronage dividends, that was the profits.”

The condition proposed above on which the renters might receive refunds is not in accordance with the provisions of the By-laws of Little River and cannot be construed as an agreement by the renters to forego refunds to which they were entitled without the necessity of subscribing for stock.

On the other hand the renters stated that nothing at all was said about refunds when they rented the land. The record discloses that appellants, and apparently no one else, gave any thought to refunds until this court rendered the opinion in Houck v. Birmingham, hereafter referred to, on June 12,1950. The burden was on appellees to prove that when appellants entered into the rental contracts they also agreed to waive refunds to which they were entitled from cotton ginned by Little River, and we cannot say that the testimony discharges that burden.

Having concluded that appellees have not met the burden of proof on this point, our further consideration will be on the basis that the rental contracts were silent as to refunds or patronage payments.

Refunds to Non-members. Appellants rely on our opinion in the case of Houck v. Birmingham, 217 Ark. 449, 230 S. W. 2d 952, for a reversal in this case. The Houck ease involved the same kind of cooperative gin, the same question relative to refunds, and other similar pertinent facts, and it was there held that sharecropper tenants were entitled to patronage payments. Three of the appellants here were sharecroppers, while the other appellants paid as rent one-fourth of the cotton raised. In the Houck opinion it was made clear that the latter class of renters were in a more favored position to claim refunds than were sharecroppers, so no distinction need be made between the two classes of renters in so far as it relates to this opinion.

In reply to appellants’ reliance on the Houck opinion, appellees advance two arguments. First, that said opinion leads to an affirmance here, and, second, that the two cases are distinguished because the Articles of Incorporation and the By-laws of the two Cooperatives involved are not the same. We shall now examine these two arguments in the order mentioned.

First. Referring to the Houck opinion, appellees call attention to this language: “The nature of the cropper’s rig’ht in the crops, or the proceeds thereof, depends upon the intent of the parties as ascertained from their contract.” Based on this language the argument is made; that, before appellants can win they must show it was their intent, when the rental contracts were entered into, to receive refunds, and; that no such intent is shown by the evidence. It is true that the evidence discloses no such intent on the part of the renters. In fact, it is specifically stated by appellants that they had no such intent because they never thought of refunds until the opinion in the Houck case was delivered. We think, however, that the above quoted language does not have the significance attached to it by appellees. The language was used in the Houck opinion in an effort to distinguish between the legal status of a sharecropper who receives one-half of the crop from his landlord arid the status of one who pays one-fourth of the crop to his landlord. There the court , was dealing with sharecroppers, and an analysis of the whole opinion shows clearly that they were entitled to refunds because of the provisions in the Articles of Incorporation and the By-laws of the Cooperative Grin and not because the sharecroppers intended or contracted to receive refunds when the rental contracts were made with their landlord.

Second. As indicated above, appellees make the argument that the opinion in the Houck case is not controlling here because the Articles of Incorporation and the By-laws in the Planters Cooperative, under consideration in that case, are not the same as the Articles of Incorporation and the By-laws in this case. Referring to the Houck case appellees state; “that case certainly is not in point with the case at bar. The By-laws of that cooperative were entirely different- to the By-laws of the Little River Cooperative Grin, Inc.” At another time appellees, in an effort to show that non-members are not entitled to refunds here, quote Article III in the By-laws of Little River which deals with qualifications for membership. Appellees’ position in this connection is without merit. A careful comparison of the Little River Articles of Incorporation which appear in full in the record are exactly like the Articles of Incorporation considered in the Houck case, as is shown by a comparison of the records in both cases.

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Related

Collie v. Coleman
281 S.W.2d 955 (Supreme Court of Arkansas, 1955)

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Bluebook (online)
265 S.W.2d 515, 223 Ark. 206, 1954 Ark. LEXIS 638, Counsel Stack Legal Research, https://law.counselstack.com/opinion/collie-v-coleman-ark-1954.