Case Name: Louisiana Northwest Railroad Company v. McMorella
Court: Arkansas Supreme Court
Jurisdiction: Arkansas
Decision Date: 1926-03-08
Citations: 170 Ark. 921
Docket Number: 
Parties: Louisiana Northwest Railroad Company v. McMorella.
Judges: 
Reporter: Arkansas Reports
Volume: 170
Pages: 921–928

Head Matter:
Louisiana Northwest Railroad Company v. McMorella.
Opinion delivered March 8, 1926.
Henry Stevens, for appellant.
McKay & Smith, for appellee.

Opinion:
Hart, J.,
(after stating the facts). It is first contended by counsel for the defendant that the judgment should be reversed because the court erred in refusing to compel the plaintiff to make her complaint more definite and certain. The record shows that the defendant filed a motion to require the plaintiff to make her complaint more definite and certain, but that the motion was never acted upon by the court. It has been repeatedly held by this court that, unless a party secures a ruling on a demurrer, it will be presumed on appeal that the demurrer was abandoned. Kierman v. Blackwell, Admr., 27 Ark. 235; Hobart-Lee Tire Co. v. Keck, 89 Ark. 122; and Harbottle v. Central Coal & Coke Co., 134 Ark. 254, and cases cited. And, as a rule, a motion which, so far as appears from the record, was never decided below presents no question for decision in the appellate court. Baker v. Martin, 95 Ark. 62, and 3 C. J. p. 890, par. 797. It follows that this assignment of error is not well taken.
It is insisted that the judgment should be reversed because the item of $2,467.46 resulted from a colonization contract which the plaintiff made with George W. Hunter as receiver of the Louisiana & Northwest Railroad Company, which the receiver was not authorized to máke. The record shows that George W. Hunter, as receiver, made a contract with the plaintiff to furnish ties for the railroad company, and to look after certain lands belonging to the railroad company which the railroad had sold to a Bulgarian colony. For her services the plaintiff was to receive a salary and a certain commission on the ties furnished. Her own testimony, and that of George W. Hunter, show that she performed the services, and that the sum of $2,467.45 was due her. While the record does not disclose that the receiver was expressly authorized to make this contract, it does show that the receiver made a -report to the court in which he. explained the contract, and made a detailed statement of what the plaintiff had done under the contract. The court expressly ratified and approved the action of the receiver in the premises. It appears from the record that the services of the plaintiff in the premises were of great benefit to the railroad company, and that they were worth the amount claimed. The action of the court in ratifying the contract of the receiver in allowing the $2,467.46, made the contract as legal and binding as if it had been expressly authorized in the first place.
It is next insisted that the remaining items of the account do not fall within the allegations of the complaint. We can not agree with counsel in this contention. We do not deem it necessary to set out the whole complaint. It is sufficient to say that the whole account copied in our statement of facts was made an exhibit to the complaint. While the action is not founded upon the account, and is founded upon the contract which the plaintiff made with the receiver, still it may be referred to as explanatory of the allegations of the complaint. Abbott v. Rowan, 33 Ark. 593, and Rouldin v. Jennings, 92 Ark. 299.
When the allegations of the complaint are considered with reference to the account, we are of the opinion that the matters embraced in the account come fairly within the allegations of the complaint. The whole matter was developed by the proof, and it does not appear that the defendant was taken by surprise at any item of the account.
According to the testimony of the plaintiff, the amount of attorney's fees expended by her for the benefit of the defendant was reasonable, and no effort is made by the defendant to show to the contrary. Her expense account was also reasonable, and was incurred while she was attending to the business of the defendant. It is inferable from the record that the railroad company was in an insolvent condition when it went into the hands of the receiver, and that the action of the receiver in managing it resulted in putting it back upon a sound financial basis. The plaintiff was of great assistance to the receiver in accomplishing this result. The railroad company had on hand the lands which it had attempted to colonize, and it was necessary to carry out its contracts in the premises. The whole matter was referred to the court and thoroughly explained by the receiver in the summer of 1920.
The judge of the Federal court which appointed the receiver, in discussing the affairs of the railroad company with the receiver, asked him about the contract with the plaintiff. It appears from the records that the railroad company had sold some of its lands to Bulgarian farmers who were very ignorant, and who were unable to carry out the'ir contracts. It was necessary for the receiver to take over some of these lands and to wind up the contracts with the Bulgarians. The plaintiff was directed to take charge of these lands, and to handle the business for the railroad company under the receiver. On account of the financial condition of the railroad company,- it was difficult to get ties, and for this reason arrangement was made with the plaintiff to get out the ties. It was almost impossible to buy ties through the regular channels, and, in addition, the prices were too high. The receiver made a detailed report of all of his actions in the premises, which was approved by the court. The report of .the receiver showed the terms of the contract with the plaintiff and the balance due her. The general rule is that, where a court of chancery takes possession of a railroad and operates the same through a receiver, it may authorize the receiver to make all contracts necessary to carry on the business of such railroad. The action of the court in ratifying the contract made by the receiver with the plaintiff made it as legal and binding as if the court had expressly authorized it in the first place.
It is also insisted that, the judgment should be reversed because the amount paid by the plaintiff as attorney's fees was for her benefit, and not for the benefit of the railroad company. It is true that the legal title of the lands in question was in the plaintiff, but she held them in trust for the railroad company. According to her testimony, the legal services were performed for the benefit of the railroad company entirely. She acted throughout for the benefit of the railroad company, and did not claim any beneficial interest whatever in the lands. Her expense account, according to her testimony, was reasonable, and was authorized under her contract with the receiver. The respective theories of the plaintiff and of the defendant were submitted to the jury undér proper instructions, and the jury was warranted under the evidence in finding for the plaintiff.
There is no prejudicial error in the record, and the judgment will be affirmed.