Case Name: Bank of Commerce of Earle v. Tubb
Court: Arkansas Supreme Court
Jurisdiction: Arkansas
Decision Date: 1923-01-22
Citations: 156 Ark. 487
Docket Number: 
Parties: Bank of Commerce of Earle v. Tubb.
Judges: 
Reporter: Arkansas Reports
Volume: 156
Pages: 487–495

Head Matter:
Bank of Commerce of Earle v. Tubb.
Opinion delivered January 22, 1923.
Landlord and tenant — landlord’s lien — conversion op crop.— Where a tenant, after having grown a crop of cotton, shipped it to a factor out of the State and subsequently sold it to defendant out of the State, there was no liability on the purchaser’s part for defeating the landlord’s lien, in the absence of prearrangement or connivance on the purchaser’s part, though both the tenant and the purchaser were residents of the State at the time of the conversion of the crop in another State. .
Appeal from Crittenden Chancery Court; Archer Wheatley, Chancellor;
reversed.
A. B. Shafer, for appellant.
The record discloses that appellant had nothing to do with shipping the cotton to Memphis and knew nothing about such shipment until the event actually occurred, which state of facts distinguishes this case from that of Walker v. Bose, 153 Ark. 599. There is here no question of comity as there is in 132 Ark. 592. The Arkansas statute giving a landlord a lien on his tenant’s crop does not have extraterritorial effect so as to preserve that lien after the cotton is shipped out of the State. Nor does the fact that Tennessee has a similar statute help the ’Arkansas landlord. 75 Miss. 150; 82 Miss. 747; 129 U. S. 355; 16 R. C. L. p. 989; Kirk v. Bailey-Ball-Pmnphrey Co. (Tenn.) ms. op.
Hughes & Hughes, for appellee.
Equity acts in personam and not in rem. 1 Pomeroy’s Eq. Juris, sec. 429.
Where a court has jurisdiction of the person, it may-render an appropriate decree acting directly upon the person, although the subject-matter may be without the jurisdiction, compelling the performance of a contract, or prevent the prosecution of an action outside the jurisdiction. Without regard to the situaion of the subject-matter, courts consider 'the equities, and enforce obedience to their decrees by process in personam. 21 C. J. p. 150-151. See also 53 Ark. 71. A purchaser who contrives with a tenant to destroy a lien is liable for the value of the property which has come into his hands. 34 Ark. 691; 67 Ark. 362; 69 Ark. 551; 72 Ark. 132; 95 Ark. 32; 103 Ark. 91. A mortgage or lien created under the statutes of Arkansas still exists, although the property, which is the subject-matter thereof, has been removed from the State 1 Wharton, Conflict of Laws, p. 717; 173 Fed. 471; 72 Ark. 132; 129 II. S. 355; 96 Ala. 214; 99 Fed. 187; 29 Fed. 156; 52 Am. St. Rep. 780; 132 Ark. 592. While no extraterritorial operation of our statute- is claimed, it is also true that other States give effect to rights acquired under foreign statutes, within certain known limits. This case is not within any of the exceptions. Dicey, Conflict of Laws, XOIII; 241 Fed. 690; 114 Tenn. 344.
A. B. Shafer, for appellant, in reply.
There is a distinction between contract and statutory liens. A contract lien is not limited to any particular jurisdiction, whereas a statutory lien is only enforceable within its jurisdiction. 3 Barb. (N. Y.) 89.

Opinion:
McCulloch, C. J.
The plaintiff, Mary E. Tubb, owns a plantation in Crittenden County, and rented it for .the year 1920 to Manly Fox for the stipulated -rental price of $8',000. Fox mortgaged his crop on the plantation to the defendant, Bank of Commerce of Earle, a domestic banking corporation doing business at the town of Earle, in Crittenden County. Of the crop of cotton srown and gathered by Fox, he sold five bales to the defendant at the latter's place of business in Arkansas, and he shipped twenty-nine bales to the Nebhnt Cotton Company, of Memphis, Tennessee, as his factors. After the shipment had reached the warehouse of the factors in Memphis, the defendant, acting through its vice-president, met Fox in Memphis and purchased the cotton from Fox and credited the proceeds on the latter's indebtedness to the defendant. The whole transaction occurred in the city of Memphis, where the cotton was then situated.
The defendant knew at the time that it purchased the five bales of cotton from Fox in Crittenden County, as well as when it purchased the twenty-nine bales from Fox in Memphis, that the cotton was grown on the plantation of Mrs. Tubb, and that the rent was unpaid.
This is an action instituted by Mrs. Tubb against the defendant asserting a landlord's lien on the cotton sold to defendant and seeking to hold the latter liable by reason of having received and converted the cotton upon which the lien is claimed. The material facts are undisputed.
The principles which control the present controversy are stated in another opinion of the court handed down this day. Sledge & Norfleet Co. v. Hughes, ante, p. 481. In that case we stated the law to be that " if the conversion took place in Tennessee, the law of that State must govern the question of liability," but that, if the conversion occurred in the State of Arkansas, our laws control, and the lien is effective, unless waived, or if the cotton was transported out of the State by the connivance here of appellant so as to destroy the lien and prevent its enforcement, this establishes liability on account of violation of the rights of the landlord.
In each of the two cases in which the law was declared as above quoted we found from the undisputed facts that the conversion took place in Arkansas and that there was liability for the conversion under the laws of this State. In the present case, however, the facts are undisputed that the conversion took place in the State of Tennessee, and, as shown in the opinion in the other cases just referred to, the- Supreme Court of Tennessee has declared the law to be that the statutory lien of another State has no extraterritorial effect, and there can be no recovery under the laws of Tennessee under such a lien created by the laws of another State.
In the present case the cotton was shipped by the tenant, not to the defendant or its agents, but to a cotton factor of the tenant's own selection. There is no evidence of any prearrangement between the tenant and defendant in this case to ship the cotton, or that the defendant advised or connived at the shipment. The full extent of the facts, as shown by the proof in the record, is that the cotton was shipped to Memphis, and subsequently the defendant's agent met Fox, the tenant, in Memphis and purchased the cotton from him. There is therefore no case made of connivance between the parties or any conduct that would constitute a destruction of the lien before the cotton was sold by Fox to the defendant in Memphis. The facts in the case do not, in other words, bring it within the decision of this court in the recent case of Walker v. Rose, 153 Ark. 599. In that case the defendant, with knowledge of the landlord's lien, advised the tenant to ship the cotton to Memphis and sell it there and turn over the proceeds to the defendant, and this was done. We held that this was a wrongful act committed by the defendant upon the rights of the plaintiff as landlord, and resulted in destruction of the latter's lien, which rendered the defendant responsible.
Learned counsel for the plaintiff seek to maintain the right of recovery against the defendant on the theory that, even though the cotton was situated in Tennessee, equity acts in personam with power to compel obedience to its mandate, and that the conversion of the cotton in another State did not deprive plaintiff of this remedy. The remedy may have been available if sought before the sale of the cotton which constituted the conversion, but we must, as before stated, test the validitv of the act of conversion by the laws of the State of Tennessee, and if the act was lawful there, there was no remedy here to be enforced against the defendant by the courts of this State. The fact that both parties were residents of this State and amenable to its laws at the time of the conversion in Tennessee does not affect the question of liability for an act committed in another State.
We conclude therefore that there is no liability on the part of the defendant for the value of the twenty-nine bales of cotton purchased from Fox in Tennessee. It is conceded that there is liability for the value of the five bales of cotton purchased in Crittenden County.
The decree is therefore reversed and the cause remanded, with directions to render a decree in plaintiff's favor against the defendant only for the five bales of cotton converted in this State.