Court Opinion

ID: 7809142
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:10:40.50317+00
Date Added: 2024-06-11T16:30:25.152000
License: Public Domain

McCULLOCH, C. J., (dissenting). I am unable to find in this record any justification for disregarding the written contract between the parties settling the controversy by compromise. The undisputed facts are that after the loss occurred the insurance company agreed to have the damage to the building repaired by a carpenter who was suggested by the school directors. There is a conflict in the testimony as to who actually employed the carpenter, but none as to the fact that the directors selected him. The repairs were made and accepted by the directors, and the compromise settlement was reduced to writing in the form of a draft for the cost of the repairs and the directors signed the endorsement which recited the terms of the compromise. It was more than a mere receipt for the money. It was a contract for a settlement of the pending controversy. This court has heretofore steadily adhered to the rule that such a contract can not be varied by parol testimony, nor set aside except for fraud or mistake. Cleveland-McLeod Lumber Co. v. McLeod, 96 Ark. 409; Cherokee Construction Co. v. Prairie Creek Coal Mining Co., 102 Ark. 428; Williams v. C., R. I. & P. Ry. Co., 109 Ark. 82; K. C. S. Ry. Co. v. Armstrong, 115 Ark. 123; Hardister v. St. L., I. M. & S. Ry. Co., 119 Ark. 95; Scullin, Receiver, v. Newman, 127 Ark. 227. In other words, the consideration mentioned in the contract and the agreement to accept it in full settlement of the controversy was of the essence of the contract and concluded the rights of the parties, unless there is sufficient proof of fraud or mutual mistake to justify a court in disregarding the contract. The distinction between a written receipt, which is only prima facie evidence, of its contents, and a contract evidencing the mutual concessions of the parties has been recognized by this court in the decisions cited above. For instance, in Cleveland-McLeod Lumber Co. v. McLeod, supra, we said: “It is settled by authorities too numerous to mention that a receipt is only prima facie evidence of payment, which may be rebutted by proof that no payment was in fact made. A release, however, stands upon a somewhat different; footing; and where there'is an express agreement in writing for a release of enumerated demands or of all demands, this; like other contracts, is binding unless set aside on account of fraud or mistake, and can not be contradicted or varied by oral testimony.” Again in the case of Cherokee Construction Co. v. Prairie Creek Coal Mining Co., supra, we said: “The parties, in order to avoid the evils of litigation, made a compromise and settlement of all matters and differences between them. The lease or instrument in question was something more than a mere receipt. It was the final embodiment in writing of the agreement between the parties. It is a comprehensive discharge, not only of the differences between the parties, but of all matters between them.” There is no claim of fraud in this case which induced the execution of the contract,' and the only mistake claimed is that the parties assumed in the contract that the building had been properly repaired. It is true that everybody, including the carpenter and one of the directors, who worked for the carpenter in making the repairs, thought the. repairs were sufficient, but that was not such a mutual mistake as to justify a rescission of the contract. That was one of the contingencies which the parties settled in making the compromise agreement for final settlement of the controversy by payment of the sum spent in having the repairs made. There is no element in the case of the reliance by one party upon the superior knowlr edge of the other party, or its agents, concerning the subject-matter of the. settlement, so as to afford grounds for setting aside the contract. The result of the decision in this case is to release one of the parties from the binding force of the contract merely because he got the worst of the bargain, without fault of the other party, and without any mistake on either side as to what the parties intended to settle by the compromise.