Case Name: McCarroll, Commissioner of Revenues v. Farrar
Court: Arkansas Supreme Court
Jurisdiction: Arkansas
Decision Date: 1939-11-27
Citations: 199 Ark. 320
Docket Number: 4-5825
Parties: McCarroll, Commissioner of Revenues v. Farrar.
Judges: Smith and McHaney, JJ., concur.
Reporter: Arkansas Reports
Volume: 199
Pages: 320–332

Head Matter:
McCarroll, Commissioner of Revenues v. Farrar.
4-5825
134 S. W. 2d 561
Opinion delivered November 27, 1939.
Jack Holt, Attorney General, Millard Alford, Asst. Atty. General, Frank Pace, Jr., and Lester Ponder, for appellant.
J. Hugh Wharton and Rose, Loughborough, Dobyns <& House, for appellees.
Joseph M. Hill, Amicus Curiae.

Opinion:
Mehaeey, J.
This action was instituted in the Pulaski chancery court by H. E. Farrar, appellee, a retail liquor dealer. He alleges this suit is brought on behalf of himself and all others interested in the enforcement of the illegal exactions mentioned in this complaint. He alleged that act 310 of the Acts of 1939 is unconstitutional. This suit is against Z. M. McCarroll, Commissioner of Eevenues for the State of Arkansas, and wholesale liquor dealers.
A. A. Haynie filed an intervention on behalf of himself and other consumers of liquor who might be interested in enforcement of the illegal exactions described in the complaint.
The wholesale dealers who were made defendants filed answer and cross-complaint and stated that this answer is filed on behalf of themselves and all others interested against the enforcement of the illegal ex-actions described in the complaint. All of them, the intervention, answer and cross-complaint, alleged that act 310 of the Acts of 1939 was unconstitutional and void.
Z. M. McCarroll, Commissioner of Eevenues for the State of Arkansas, filed a demurrer to the complaint, intervention and cross-complaint on the ground that the pleadings do not state facts sufficient to entitle plaintiff to the relief prayed, or to any relief whatsoever. The Commissioner of Eevenues also filed answer denying the material allegations of .the complaint, and alleged among other things, that on June 12, 1939, act 310 above referred to was held valid. McCarroll, both as Commissioner and as a citizen, asked that plaintiff's complaint be dismissed.
The complaint in the case of Mike and Joe Galdarera v. Z. M. McCarroll, Commissioner, 198 Ark. 584, 129 S. W. 2d 615, was introduced as an exhibit. Also a copy of the decree in that case was introduced. The plaintiff then filed a demurrer to the answer of Z. M. McCarroll on the ground that the allegations do not state facts sufficient to constitute a defense.
The court overruled the demurrer of the Commissioner of Eevenues and sustained the demurrer filed by the plaintiff to the answer of the Commissioner, and the decree of the chancellor permanently enjoined Z. M. McCarroll, Commissioner, from collecting from all wholesalers of liquor the three per cent, tax, but provided, however, that during the pendency of the appeal an amount equal to the amount of tax which would be due if said act were valid, shall be paid by said wholesalers into the registry of the court at the time said tax would be due under the act, if valid, to be held by the clerk of the court subject to further orders of the court.
The Commissioner of Revenues objected and excepted to all provisions of said decree, and prayed an appeal to the Supreme Court, which was granted. The case is here on appeal.
The appellant contends that the constitutionality of act 310 of the Acts of 1939 is res judicata» by virtue of the decision in the case of Caldarera v. McCarroll, 198 Ark. 584, 129 S. W. 2d 615.
15 R. C. L., § 429, gives the following statement of the doctrine of res judicata:
"The doctrine of res judicata is a,principle of universal jurisprudence forming part of the legal systems of all civilized nations. It may be said to inhere in them all as an obvious rule of expediency and justice. Briefly stated, this doctrine is that ah existing final judgment or decree rendered upon the merits, and without fraud or collusion, by a court of competent jurisdiction, upon a matter within its jurisdiction, is conclusive of the rights of the parties or their privies, in all other actions or suits in the same or any other judicial tribunal of concurrent jurisdiction, on the points and matters in issue in the first suit."
C. J., Yolume 34, p. 743, states the two main rules of the doctrine of res judicata-. "(1) .The judgment or decree of a court of competent jurisdiction upon the merits concludes the parties and privies to the litigation and constitutes a bar to a new action or suit involving the same cause of action either before the same or any other tribunal. (2) Any right, fact, or matter in issue, and directly adjudicated upon, or necessarily involved in, the determination of an action before a competent court in which a judgment or decree is rendered upon the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and privies whether the claim or demand, purpose, or subject-matter of the two suits is the same or not."
Was the suit of Caldarera, above, a judgment of a .court upon the merits 1 The question in that case was whether act 310 of the Acts of 1939 was unconstitutional, and the court in that case held that it was a valid act. Since that was the question in the case, it certainly cannot be claimed that it was not a judgment upon the merits. And if a judgment upon the merits, it concludes the parties and privies and constitutes a bar to a new action or suit involving the same cause of action, either before the same or any other tribunal.
The Constitution of the State of Arkansas provides that any citizen of any county, city or town may institute suit in behalf of himself and all others interested, fo protect the inhabitants thereof against the enforcement of any illegal exactions whatever. Under this provision of the Constitution, the suit ih the Caldarera case was 'brought.
The instant suit was instituted under the same authority.
In the case of Rigsby v. Ruraldale Consolidated School District No. 64, 180 Ark. 122, 20 S. W. 2d 624, this court said:
"In support of the plea of res judicata set out above appellees introduced the pleadings and decree rendered upon them, and the evidence in the Johnson case by the Garland chancery court.
"The trial court in the instant case dismissed appellant's complaint for the want of equity, from which is this appeal.
"The action of the trial court in dismissing appellant's complaint was proper. The plea of res judicata and testimony introduced in support thereof justified the court's action."
The court further said in the same case: "The only authority he had to bring the suit was under § 13, art. 16, of pur State Constitution." That Is the section above quoted, authorizing a citizen to bring suit on behalf of himself and others.
The court; continuing, said: "C. J. Rigsby instituted the instant case under the same authority, and all citizens in the district were bound by the result of the suit brought against appellees by R. M. Johnson upon all issues presented by the pleadings and testimony in the Johnson case." The court cites 15 R. C. L., pp. 1026 and 1035. Page 1026, % 500, R. C. L., reads as follows:
"The doctrine of virtual representation whereby persons may be bound by a judgment, although not parties to the suit* on the theory that they are sufficiently represented by those who are parties on the record, has been applied to cases in which there are large numbers of parties in interest, and whenever the parties in interest are so numerous as to make it impracticable or very inconvenient and expensive to bring them all before the court, it is sufficient that such a number be made plaintiffs or defendants as will fairly represent the interest-of all standing in like character and responsibility, and a judgment against them will have the effect of res judicata against all who were thus represented."
Section 510, page 1035, of the same volume reads as follows: "Where a citizen and taxpayer brings an action in behalf of himself and other taxpayers against a municipality every citizen is regarded as a party to the proceedings, and bound by the judgment entered therein. In such cases the people are regarded as the real parties. For example,'the judgment in.a suit brought by taxpayers of a town against the town and a railroad company, to enjoin the issue by the town of bonds to the company, by which it is adjudged that such bonds should issue, is binding on all the other taxpayers of the town, though not parties to the suit, and the questions involved therein are res judicata in a second suit by another taxpayer to restrain the payment of interest on the bonds. In all such cases, however, the first judgment must be bona fide."
We think the Rigsbv case above cited settles this question, and it is not necessary to review other authorities.
The constitutionality of act 310 was the question involved in the Caldarera case, and it is also the question involved in this case. In each case, the journal of the Senate was introduced. In the instant case, the complaint and other pleadings and the decree in the Caldarera case were all introduced in evidence.
If a suit of this character is not a bar, then one citizen after another might institute a suit for himself and others against the Commissioner of Revenues, and if the judgment in one suit was not a bar, this could continue until every citizen in the state had brought suit. The doctrine of res judicata is not only to protect the individual, but it is a matter of public policy.
We have reached the conclusion that the Caldarera ease above referred to settles this case, and is res judicata. The chancery court erred in sustaining the demurrer of the plaintiff and overruling the demurrer of the Commissioner.
The decree of the chancellor is reversed, and the cause is dismissed.
Smith and McHaney, JJ., concur.