Martin v. Hempstead County Levee District No. 1 , 98 Ark. 23 ( 1911 )

Hart, J.,

(after stating the facts). Counsel for appellant first earnestly insist that the court erred in transferring the cause to equity over her objections. To sustain their contention, counsel cite the case of Stewart v. Fleming, 96 Ark. 371, where this court held: “In a suit upon a contract an answer alleging that the contract was procured by fraud sets up a defense available at law, and there was no error in refusing to transfer the case to equity.” We do not think the case in point. There the plaintiff sought to recover a sum of money alleged to be due under a certain provision of a lease. The defendant did not assert any affirmative rights under the lease, but only defended the suit brought oh the ground the provision of the lease, which was the foundation of the action, had been inserted without his knowledge by reason of certain false and fraudulent representations of the plaintiff. Here the appellee asks that the contract be made to conform to the agreement entered into according to the intention of the parties, and when so reformed appellee alleges that it is entitled to damages because appellant failed to perform the contract according to its terms; that is to sa)', appellee first asks that its rights under the contract be established, and, second, that its rights as established be enforced affirmatively against appellant. T>he Erst is granted as preliminary to the final relief; and in such cases equity has exclusive jurisdiction. 1 Pomeroy’s Equity Jurisprudence (3 ed.), 171.

“The mere negligence or omission to read or know the contents of a writing is not necessarily a bar to reformation. The relief is proper when the instrument fails to conform to the agreement between the parties, through mutual mistake or mistake coupled with fraud, however the mistake may have been induced. The doctrine of laches is applicable to these suits, and in some jurisdictions the statute of limitations is expressly made applicable. The rule is here, as in all cases of fraud and mistake, that the time does not begin to run until discovery of the mistake or until it ought to have been discovered.” 6 Pomeroy’s Equity Jurisprudence (3 ed.), § 680.

It must also be borne in mind that to justify or authorize the reformation of the written instrument in such cases the proof must be clear, unequivocal and decisive. Mitchell Mfg. Co. v. Kempner, 84 Ark. 349; Turner v. Todd, 85 Ark. 63, where our earlier cases on the subject are collected.

We now come to the application of these principles of law to the facts of this case. We do not deem it necessary to abstract the testimony at length. It is sufficient to say that all the members of the levee board, and its attorneys, who rewrote the contract, plans and specifications after they had been finally agreed upon, testify that the contract as reformed by the court is the contract that was made between the parties; that the contract plans and specifications as rewritten before the same were signed were borrowed by P. J. Martin, the husband and agent of appellant’s bondsmen; that he returned with what purported to -be the copy furnished him, and that, relying upon his representations, they signed same. They did not discover that P. J. Martin had changed same until this suit was commenced. They are corroborated by the chief engineer of the board, who was present when the draft of the contract, -plans and specifications were agreed upon. He says that he directed and supervised the construction of the levee under a copy of the contract, plans and specifications identical with that exhibited with the answer and cross complaint, and never knew of the changes therein until this suit was brought; that P. J. Martin, who acted for appellant at all times, never made any claim during the construction of the levee that the contract was otherwise than as claimed by appellee.

Two or three copies of the contract, plans and specifications were made by Etter & Monroe. Etter testifies that the one exhibited with the answer, type, paper, etc., has every appearance of being the one rewritten by him; that,he does not remember of having used any paper like that exhibited with the complaint as the copy of the contract, plans and specifications. Opposed to this is the testimony of P. J. Martin alone.

We are of the opinion that it is clearly and unequivocally established by the evidence that the contract, plans and specifications for constructing the levee were the same as that contained in the copy exhibited with the answer and cross complaint, and that the changes were not discovered by.appellee until this suit was brought.

The chancellor found that, by reason of the failure of appellant to construct said levee according- to contract, plans and specifications, appellee has been damaged as alleged in its counterclaim in a greater sum than the balance due appellant. We do not deem it necessary to make a detailed abstract in regard to this. We deem it sufficient to say that we have carefully considered the evidence, and believe that it sustains the finding of the chancellor.

We have carefully considered the record, and think the differences between the parties arose on account of the, difference in the language used in the copy of the contract, .plans and specifications exhibited with the complaint and in the copy exhibited with the answer and cross complaint, and we find that the copy of the contract, plans and specifications for the construction of the levee, exhibited with the answer and cross complaint, contains the agreement entered into between the parties to this suit.

The chancellor was right in not allowing the $1,000 claimed by appellant for appellee’s alleged failure to comply with the contract. There is no proof that appellant was delayed in her work and damaged thereby. Indeed, appellant has abandoned that feature of the case.

The decree will be affirmed.