Ritchie v. Bluff City Lumber Co.

Hart, J., (after stating the facts). The rule is well settled that when a person, without mistake of fact or fraud, duress, coercion, or extortion, pays money on a demand which is not enforceable against him, the payment is deemed voluntary, and can not be recovered. Larrimer v. Murphy, 72 Ark. 555; LaFayette v. Merchants’ Bank, 73 Ark. 565; Vick v. Shinn, 49 Ark. 70; 22 Am. & Eng. Enc. of Raw, (2d Ed.), 609. Appellant invokes the application of this doctrine in the present case as a ground for reversal. The undisputed testimony shows that appellant received certain advancements from time to time from appellee, and was credited with the sum of $3,800 per year, beginning from the date of the contract in controversy. There may be some grounds for dispute about the exact terms of the contract, but there is none in regard to the fact that the credits were placed upon the books of the company, and that with the knowledge of Rutherford, its secretary and general manager. It is claimed by appellee that the making of the advancements and the placing of - the credits to the account of appellant was not a payment, but we fail to perceive the reason or justness of this contention. Where there is an open account between two parties, in the absence of an agreement to the contrary, all items of the account become constituent parts thereof, and are applied in payment of the oldest item in the account on the other side, and he only is entitled to recover in whose favor the final balance upon the whole account is found. The rule is where there are mutual accounts, the credits on one side are applied to the extinguishment of debits on the other as payments intentionally made thereon. For the reason that there is no evidence -to show that the payments were not voluntarily made with the full knowledge of the facts, the cause is reversed and remanded for a new trial.