case files

renee kalia



Jage Ram (D) Thr. Lrs. Union of India & Anr.

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NON-REPORTABLE IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 5630 of 2017 (Arising out of S.L.P. (Civil) No.14272 of 2015)

Jage Ram (D) Thr. Lrs. Union of India & Anr.

Versus WITH

….Appellant(s) …..Respondent(s)

CIVIL APPEAL NO. 5631 of 2017 (Arising out of S.L.P. (Civil) No.14277 of 2015)

J U D G M E NT MOHAN M. SHANTANAGOUDAR, J.

The appellants are owners of the land to an extent of 1⁄2 share in Khasra No. 46 (4-08), 462 (4-16), 463 (4-14), totally measuring 13 bighas 18 biswas situated in revenue estate of Village Roshan Pura, New Delhi. The land was acquired for the public purpose of construction of Sub-Divisional Office. The Land Acquisition Collector passed the Award bearing no. 45/78-79, awarding compensation at the rate of Rs. 2,200/- per bigha along with statutory benefits such as solatium, interest etc. as provided under the Land Acquisition Act, 1894.

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1. The appellants, being dissatisfied with the quantum of compensation awarded by the Land Acquisition Collector, filed petition under Section 18 of the Land Acquisition Act. The said petition came to be dismissed by the Reference Court/Additional District Judge, Delhi on 04.10.2005 in LA Case No. 896 of 1993. The appellants further approached the High Court of Delhi by filing LA.A.No.34/2006 and L.A.A.No.35-54/2006 which also came to be dismissed. The appellants are aggrieved by the award of the Land Acquisition Collector, Award passed by the Reference Court as well as by the judgment of the High Court.

2. Mr. Arvind K. Sharma, the learned counsel for the claimants/appellants submitted that the Reference Court as well as the High Court were not justified in ignoring the Sale Deed dated 24.01.1974 produced by the claimants in respect of the land measuring 4 bighas and 16 biswas situated adjoining Chhawla Gurgaon Road in village Roshan Pura, Delhi which depicts that the price per bigha was about Rs.7,000/-. According to him, though no relevant evidence is adduced by the parties including the claimants, the aforementioned certified copy of the sale deed could be sufficient evidence in support of the case of the claimants for getting higher compensation.

3. Per contra, Ms. Garima Prashad, learned counsel for the respondents argued that the Land Acquisition Collector has sufficiently compensated the claimants in

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respect of the acquired land therefore, the Reference Court as well as the High Court were justified in dismissing the contention of the claimants for enhanced compensation.

4. In the matter on hand, none of the parties have led oral evidence in support of their respective cases. However, certified copies of the two Sale Deeds are available on record which came to be produced by the parties before the Reference Court. The Sale Deed dated 24.01.1974 relied upon by the appellants depicts the price of one bigha of the property sold through the said sale deed was at Rs. 7,000/-, whereas the respondents relied upon the certified copy of Sale Deed dated 19.03.1971 which shows that the land therein was sold at the rate of Rs. 2,000/- per bigha under the said Sale Deed.

5. Though the Reference Court as well as the High Court have assigned valid reasons for not relying upon the Sale Deed dated 24.01.1974 relied upon by the claimants, have erred in ignoring to consider the Sale Deed dated 19.03.1971 produced by the respondents. The Reference Court as well as the High Court have merely observed, in the course of the judgment, that certified copy of such Sale Deed is produced by the respondents, but no further discussion was made as to why the said Sale Deed was not considered.

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6. We do not want to burden this judgment by reiterating the reasons assigned by the Reference Court as well as the High Court while refusing to rely on the Sale Deed dated 24.01.1974 produced by the claimants particularly when we find that the courts have on facts justified in doing so. We also find that there is no evidence to show the similarity in location/situation of the acquired land vis-à-vis the land which is the subject matter of the Sale Deed dated 24.01.1974. Moreover, the land involved in the Sale Deed dated 24.01.1974 is relatively very small piece of land having dimension to the extent of 1/4th of the land in question. While awarding the compensation for the acquired land, the Court must take into account several factors including fertility, yield, nature of soil, comparative sale statistics, its present use, its capacity for the higher potential, the precise location, potentiality to use for non-agricultural purposes, the use to which the land was put, its’ proximity to develop as urban area etc. etc. It is also to be borne in mind the special value which ought to be attached in respect of the special advantages, if any, possessed by the land. In the matter on hand unfortunately, no such evidence was let in by the claimants to show that the land covered under Sale Deed dated 24.01.1974 is having the similar characteristics as the land in question. Therefore, both the Courts below have rightly not relied upon the Sale Deed dated 24.01.1974 while coming to the conclusion.

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7. Learned counsel for the appellants relied upon the judgment in the case of Suresh Prasad @ Hari Kishan & Ors. Vs. Union of India & Ors. (Civil Appeal No. 1726 of 2015 decided on 18.3.2015) wherein this Court has fixed compensation of Rs. 22,00,000/- (Rupees twenty two lakhs only) per acre in respect of the land acquired under Acquisition Notification issued on 5.8.2003. The land involved in the said matter was of village Masoodabad. The said judgment cannot be relied upon in the matter on hand, as much as, in the present matter, the Notification issued was of the year 1973 and whereas the Notification issued in the case of Suresh Prasad was in the year 2003 i.e. almost 30 years later. Moreover, the land involved in the Suresh Prasad’s case is situated in village Masoodabad which is stated to be about 5 K.Ms. far from village Roshan Pura wherein the land to be compensated is situated in this matter. In the case of Suresh Prasad, the Land Acquisition Collector had determined compensation of Rs.15.70 lakhs per acre and the same was enhanced to Rs.24 lakhs by this Court. The compensation determined in the case of Suresh Prasad was purely based on the facts of that case and there is nothing on record to show that the land involved in Suresh Prasad’s case was having the same characteristics as the land in the present matter.

8. However, we do not find any reason to ignore the Sale Deed produced by the respondents in support of their case. As mentioned supra, the Sale Deed dated

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19.03.1971 is in respect of 11 bighas and 10 biswas of land situated in the village Roshan Pura. As per the said Sale Deed, the price per bigha of the land involved therein would be about Rs. 2000/-. Prima facie, the land in question as well as the land covered under the Sale Deed dated 19.03.1971 are approximately having the similar dimension and are situated in the same village i.e. Roshan Pura. The respondents being the beneficiaries under the acquisition have themselves relied upon the Sale Deed dated 19.03.1971 as the sole basis to oppose the prayer of the claimants. Some sort of guess work is necessary while determining compensation for the land acquired. One has to perceive from the view point of the prudent purchaser. As the acquisition is of the year 1973, we do not wish to remit the matter to Reference Court. Having regard to the totality of the facts and circumstances of the matter, in our considered opinion, the compensation may be determined relying upon the Sale Deed dated 19.03.1971 particularly when there is no other reliable material on record. Since the land under the said Sale Deed dated 19.03.1971 was valued at a sum of Rs. 2,000/- per bigha, and as the land in question was acquired in the year 1973, the compensation can be determined by adding 15% of the value of the sale consideration per year keeping in mind the escalation in price of the lands day by day. Normally 15% escalation is taken, per year by this Court in recent times while quantifying compensation. Thus, the claimants would be entitled to Rs. 2,600/- per bigha.

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10. There shall be no order as to costs.

New Delhi
Dated: May 04, 2017

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9. Accordingly, these appeals are allowed. The compensation is enhanced from Rs. 2,200/- to Rs. 2,600/- per bigha. It is needless to state that the claimants are entitled to all the statutory benefits such as solatium, interest etc. in accordance with law.

……………………….J (Dipak Misra)

……………………………..J (A.M. Khanwilkar)

………………………J (Mohan M. Shantanagoudar)

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Pierce v. State

910 P.2d 288 (1995)

121 N.M. 212

George PIERCE, William O. Jordan, Virginia A. Jordan, Estell J. Allen, Renee Kalia, Orval Hughes, Edith Hughes, Robert L. Moore, Virginia I. Moore, Drew Cloud, Bobbie J. Cloud, Leon Karelitz, James L. Sutton, and Claretta Sutton, Plaintiffs-Appellants, v. STATE of New Mexico, State of New Mexico, Through its Agency, The New Mexico Taxation and Revenue Department, Defendants-Appellees.

No. 22264.

Supreme Court of New Mexico.

December 11, 1995.

*292 James F. Hart, Robert Brack, P.A., Robert Brack, Lisa Conly Cronin, Clovis, for Appellants.

Tom Udall, Attorney General, Frank D. Katz, Bruce J. Fort, Assistant Attorneys General, Santa Fe, for Appellees.

OPINION

BACA, Chief Justice.

1. This is an appeal from a summary judgment entered in favor of Appellee State of New Mexico, Department of Taxation and Revenue, dismissing a class action lawsuit filed on behalf of two classes of retirees. Class A Appellants are those persons who received a pension prior to January 1, 1990, under the Public Employees Retirement Act (PERA), NMSA 1978, §§ 10-11-1 to -141 (Repl.Pamp.1992 & Cum.Supp.1994), the Judicial Retirement Act (JRA), NMSA 1978, §§ 10-12B-1 to -17 (Repl.Pamp.1992 & Cum. Supp.1994), the Magistrate Retirement Act (MRA), NMSA 1978, §§ 10-12C-1 to -16 (Repl.Pamp.1992 & Cum.Supp.1992), and the Educational Retirement Act (ERA), NMSA 1978, §§ 22-11-1 to -52 (Repl.Pamp.1993). Class B Appellants are those persons who received a pension prior to January 1, 1990, as a result of employment by the U.S. Armed Forces or the Federal Civil Service system. The court took under advisement whether Class B Appellants would be allowed to intervene in the action. Therefore, we do not address the claims of Class B Appellants.

2. Prior to March 1, 1990, retirement benefits paid to state retirees under each of the four Acts listed above were tax exempt. Retirement benefits paid to federal retirees were not tax exempt, however. The United States Supreme Court, in Davis v. Michigan Department of Treasury, 489 U.S. 803, 109 S. Ct. 1500, 103 L. Ed. 2d 891 (1989), found this disparate treatment of federal retirees was violative of the intergovernmental tax immunity doctrine and 4 U.S.C. § 111 (1994) (prohibiting discriminatory tax treatment of federal employees). The New Mexico legislature, addressing the violation of the intergovernmental tax immunity doctrine, passed Senate Bill 310, S 310, 39th Leg., 2d Sess., 1990 N.M.Laws, ch. 49, repealing the longstanding tax exemptions for state retirement benefits. Class A Appellants filed this class-action lawsuit alleging, among other things, an unconstitutional impairment of contract. We address four issues on appeal: (1) Whether Class A Appellants had a contractual relationship with Appellee and, if so, whether the repeal of the tax exemption provisions resulted in either a breach or unconstitutional impairment of contract, (2) whether the court erred in admitting certain exhibits, (3) whether the title to SB 310 was constitutionally defective, and (4) whether the court erred in awarding Appellee its costs. We review this case pursuant to SCRA 1986, 12-102(A)(1) (Repl.Pamp.1992) (count sounding in contract), and affirm in part and reverse in part.

I

3. The material facts of this appeal are not contested. Beginning in 1990, Class A Appellants paid state income tax on retirement benefits received by them pursuant to the PERA, JRA, MRA, and ERA. Class A Appellants timely filed amended tax returns seeking refunds on the amounts paid on state retirement benefits in 1990, 1991, 1992, and 1993. Appellee denied all refund claims based upon its position that “even if the statutory provisions governing the various state retirement acts were considered a contract creating vested rights to certain benefits binding on all future legislatures,” the legislature was obligated under Davis only to provide reasonable alternative benefits which it did by dedicating all revenue from taxing benefits to a retiree health fund.

4. Appellants brought a claim against Appellee, alleging breach of employment contract *293 and unconstitutional impairment of contract. The court denied Appellants’ motion for summary judgment but granted Appellee’s motion for summary judgment. The court determined that the statutory tax exemption did not create a contractual right and even if it did, the repeal of the tax exemption did not result in an impairment of the right because of the offsetting benefits provided under the Retiree’s Health Care Act. The court took under advisement Appellants’ motion to strike certain exhibits attached to Appellee’s motion for summary judgment. The court awarded Appellee its costs. This appeal followed.

II

5. Appellants seek reversal of the summary judgment entered in favor of Appellee. While we recognize that every Justice of this Court may have a remote pecuniary interest in the JRA retirement plan, we review this case under the rule of necessity. See State ex rel. Bardacke v. Welsh, 102 N.M. 592, 605, 698 P.2d 462, 475 (Ct.App. 1985); see also Evans v. Gore, 253 U.S. 245, 247-48, 40 S. Ct. 550, 550-51, 64 L. Ed. 887 (1920) (deciding whether Congress could tax compensation of federal judges). In reviewing the lower court’s grant of summary judgment, we recognize that a party is entitled to summary judgment as a matter of law where there are no genuine issues of material fact. See Tiguex Oil Co. v. Nassar, 99 N.M. 134, 135, 654 P.2d 1034, 1035 (1982). However, summary judgment should be granted with utmost care to avoid depriving a party of the right to a trial on the merits. Id.

6. Neither party disputes that New Mexico’s prior tax treatment impermissibly discriminated against federal retirees based on the source of the income, in direct contravention of Davis. See Davis, 489 U.S. at 817, 109 S. Ct. at 1508-09. In Davis, the United States Supreme Court found Michigan’s taxation scheme to be violative of 4 U.S.C. § 111, and the intergovernmental tax immunity doctrine based on the fact that it exempted all state retirement benefits while taxing the retirement benefits of all other citizens, including federal retirees. Davis, 489 U.S. at 817, 109 S. Ct. at 1508-09. The Supreme Court held that “the retention of immunity in § 111 is coextensive with the prohibition against discriminatory taxes embodied in the modern constitutional doctrine of intergovernmental tax immunity.” Id. at 813, 109 S. Ct. at 1506-07. Any discriminatory scheme must, therefore, be based on “significant differences between the two classes.” Id. at 816, 109 S. Ct. at 1508 (quoting Phillips Chemical Co. v. Dumas Indep. Sch. Dist., 361 U.S. 376, 383, 80 S. Ct. 474, 479, 4 L. Ed. 2d 384 (1960)). The Court noted that if significant differences justify disparate treatment, then any discrimination would be based on some criteria other than “the source of those benefits.” Id. at 817, 109 S. Ct. at 1508.

7. Because Michigan had conceded that refunds were “appropriate in these circumstances,” the Court found appellant was entitled to a refund. Id. The Court declined to offer appellant prospective relief based on its recognition that “in cases involving invalid classifications in the distribution of government benefits, … the appropriate remedy `is a mandate of equal treatment, a result that can be accomplished by withdrawal of benefits from the favored class as well as by extension of benefits to the excluded class.'” Id. at 817-18, 109 S. Ct. at 1509. (quoting Heckler v. Mathews, 465 U.S. 728, 740, 104 S. Ct. 1387, 1395-96, 79 L. Ed. 2d 646 (1984)). The Court recognized that Michigan courts are best able to determine “how to comply with the mandate of equal treatment.” Id. at 818, 109 S. Ct. at 1509.

8. When Davis was decided, roughly half of the states taxed state, federal, and military pensioners differently.[1] These *294 states have employed various methods to remedy the violation of the intergovernmental tax immunity doctrine, ranging from exemptions for all state, federal, and military retirees to partial exemptions, to taxation of all retirees. The New Mexico legislature, in determining how to “comply with the mandate of equal treatment,” see Davis, 489 U.S. at 818, 109 S. Ct. at 1509, chose to tax all benefits equally. This is a public policy decision, and we defer to the wisdom of the legislature. State ex rel. Hudgins v. Public Employees Retirement Bd., 58 N.M. 543, 548, 273 P.2d 743, 746-47 (1954) (agreeing that choice of rate at which employees would be required to contribute to retirement plan was within legislature’s discretion).

9. Most important to the question before us are those states in which the legislature elected to tax all retirees equally. The decision to tax all retirees raises the question of whether the repeal of a statutory tax exemption results in an impairment or breach of contract. We find eight states that have encountered this issue.[2] Ohio found that its legislature had granted public employees and state teachers a vested right to receive benefits, but it had not granted them “a vested right to receive their pensions exempt from tax.” See Herrick v. Lindley, 59 Ohio St.2d 22, 28, 391 N.E.2d 729, 732-33 (1979). Georgia, see Parrish v. Employees’ Retirement Sys., 260 Ga. 613, 398 S.E.2d 353, 354 (1990), cert. denied, 500 U.S. 918, 111 S. Ct. 2016, 114 L. Ed. 2d 103 (1991), and Oregon, see Hughes v. State, 314 Or. 1, 838 P.2d 1018 (1992) (in banc), found the retirement plans created contractual rights and the tax exemption provisions were part of the contracts. Neither state, however, found an unconstitutional impairment of contract resulting from the repeal of the tax exemption provisions. Georgia based its finding on the fact that the statutory provision provided an irrevocable tax exemption and thus violated the Georgia constitution. See Parrish, 398 S.E.2d at 355. On the other hand, Oregon, like New Mexico, has no prohibition against granting an irrevocable tax exemption. See Hughes, 838 P.2d at 1025.

10. Appellants urge us to follow the reasoning in Hughes. In Hughes the legislature had repealed the tax exemption provisions contained in both the Public Employes’ [sic] Retirement System (PERS) and the general tax code. The tax exemption provision contained in Oregon’s PERS read:

The right of a person to a pension, … or any other right accrued or accruing to any person under the provisions of ORS 237.001 to 237.315, … shall be exempt from all state, county and municipal taxes heretofore or hereafter imposed, shall not be subject to execution, garnishment, attachment or any other process or the operation of any bankruptcy or insolvency law heretofore or hereafter existing or enacted, and shall be unassignable.

See Ore.Rev.Stat. § 237.201 (1969).

11. Oregon relied on prior state law that had found “PERS is a contract between the state and its employees.” Hughes, 838 P.2d at 1027. The court determined that the tax exemption provision was part of the contract. Id. at 1030. The Oregon court noted that the tax exemption applied only to benefits that had “accrued or are accruing.” Id. at 1034. Therefore, the tax exemption provision for future, “unaccrued” benefits could be repealed, whereas a repeal of the tax exemption *295 for “accrued or accruing” benefits would result in an unconstitutional impairment of contract. Id.

12. However, the Oregon court did not stop there. The general tax code contained an identical tax exemption provision. The court determined that the tax code provision was “only a mirror of the obligation … not the obligation itself,” id., 838 P.2d at 1036, and its repeal would only result in a breach of the PERS contract, for which the legislature could devise a remedy, id., at 1036 n. 36. Because the state remained obligated under the PERS contract to provide a tax exemption for accrued or accruing benefits, there was no impairment of contract. Like the court in Colorado, see Spradling v. Colorado Dep’t of Revenue, 870 P.2d 521, 524 (Colo.Ct. App.1993), cert. denied, Apr. 4, 1994, the Hughes court found that an exemption under a general tax code does not create a contractual obligation, Hughes at 1036.

13. We do not find the analysis of the Contract Clause in Hughes helpful based on the fact that “we prefer to apply more modern Contract Clause analysis,” Los Quatros, Inc. v. State Farm Life Ins. Co., 110 N.M. 750, 757, 800 P.2d 184, 191 (1990), than that used by the Supreme Court during the nineteenth century, which Hughes relied on, cf. Hughes, 838 P.2d at 1024. We have determined that modern “federal Contract Clause jurisprudence will, in general, be applicable in determining whether a particular state law violates the Contract Clause of our state Constitution.” Los Quatros, 110 N.M. at 760, 800 P.2d at 194.

14. As a result, we find more persuasive Justice Peterson’s dissent in Hughes, arguing that neither the Oregon PERS nor general tax code provision constituted an irrevocable tax exemption because of the higher standard required to find that a state has surrendered its sovereign power of taxation. Hughes, 838 P.2d at 1058. “[T]he [Supreme] Court has applied a strict rule of construction against finding an irrepealable tax exemption. No decision of the Supreme Court of the United States in the last 100 years has upheld an irrepealable tax exemption.” Id. at 1051 (citations omitted). Justice Peterson further states that

[a]lthough the use of the mandatory `shall’ is indicative of the strength of the legislature’s intent … the language of section 23, the exemption provision, does not clearly and unambiguously express an intention not to allow repeal or amendment…. The placement of the exemption in section 23 among other provisions that have little or nothing to do with monetary benefits that might be the subject of a contract suggests that the exemption was not intended to be contractual.

Id. at 1054 (emphasis added). Justice Peterson stated that while the “express language of the statute is crystal clear, insofar as the income tax exemption itself is concerned…. it is anything but clear that the legislature intended to bind the hands of future legislatures in such a substantial way.” Id. at 1058. The critical question is whether the legislature intended to foreclose future legislatures from taxing PERS benefits. Id.

15. Our tax exemption provision is likewise contained in a section that has little or nothing to do with monetary benefits for the retirees. As discussed below, the tax exemption provisions are all contained within freedom from service of process provisions and have been modified as public policy has changed.

16. We also find persuasive the reasoning in Herrick v. Lindley, at 25-28, 391 N.E.2d at 732-33. Based on statutory interpretation, the Ohio court found that the “retirees have a vested right to receive a retirement allowance or similar benefit at the rate fixed by law when such benefit was conferred. However, neither [statute] grants a vested right to a continuing tax exemption.” Id. The court noted that while the end results may be the same whether the pension is reduced or taxed, “there is a definite legal distinction between reducing the rate of a pension and levying a tax upon the income received from that pension. The vesting statutes prohibit only a reduction in the rate of payment. They do not prohibit the imposition of a tax.” Id. at 27, 391 N.E.2d at 733. The court added that “every reasonable *296 doubt should be resolved against” finding the legislature had granted a vested right to a tax exemption because the legislature “partially relinquishes its ability to deal with changing fiscal conditions in the future. The power to tax being a fundamental governmental power, its impairment should not be based upon a debatable construction of statutory language.” Id. Although Ohio’s statutory provision was stated in the present tense,[3] the court did not rely on or mention this fact in reaching its conclusion. Id. at 23-25, 391 N.E.2d at 731.

III

17. Our first inquiry in determining whether Appellants had a contractual relationship with Appellee is whether the four retirement programs create either contractual or vested rights. See Whitely v. New Mexico State Personnel Bd., 115 N.M. 308, 312, 850 P.2d 1011, 1015 (1993) (stating that prerequisite to any contract claim is proof of existence of contract). If we find that the plans confer either, then we ascertain whether the tax exemptions were included within those rights. Our first task is to examine carefully the language of each statutory plan. Statutory language conferring vested rights does not necessarily confer contractual rights. Rather, contractual rights may create a vested right.

[Vesting] is substantially a property right, and may be created either by common law, by statute, or by contract. And when it has been once created, and has become absolute, it is protected from the invasion of the Legislature by those provisions in the Constitution which apply to such rights. And a failure to exercise a vested right before the passage of a subsequent statute, which seeks to divest it, in no way affects or lessens that right.

Rubalcava v. Garst, 53 N.M. 295, 298, 206 P.2d 1154, 1156 (1949) (quoting Baker v. Tulsa Building & Loan Ass’n, 179 Okla. 43266 P.2d 45, 46 (1936).) We have defined vested rights as “the power to do certain actions or possess certain things lawfully.” Id. This is not synonymous with contractual rights. We will find that a statute confers contractual rights when the language expressly so states, or the statute by clear and unambiguous terms indicates that the State specifically entered into a bargain with a party “in fact as found in their language or by implication from other circumstances, as affected by rules of law.” 1 Arthur L. Corbin, Corbin on Contracts § 1.3, at 9 (rev. ed. 1993). We will not imply “a legislative intent to create private rights of a contractual nature enforceable against the State.” Whitely, 115 N.M. at 312, 850 P.2d at 1015.

18. In order to find that the tax exemptions were contractual or vested, we must first find that the legislature clearly and unambiguously intended to create either contractual or vested rights to receive pensions benefits from the retirement programs themselves. Id.; Hughes, 838 P.2d at 1054 (J. Peterson, dissenting) (statutory language must clearly and unambiguously preclude amendment or repeal); United States Trust v. New Jersey, 431 U.S. 1, 17 n. 14, 97 S. Ct. 1505, 1515 n. 14, 52 L. Ed. 2d 92 (1976) (statutes do not create private contractual rights unless language and circumstances clearly indicate otherwise).

19. Appellants assert that there is no issue that the four retirement programs are contractual agreements between the state and the retirees, relying on State ex rel. Sena v. Trujillo, 46 N.M. 361, 367, 129 P.2d 329, 332 (1942). Appellants also contend that Appellee has conceded such a contractual relationship. However, the nature of the statutory retirement plans presents a legal question for the Court to resolve. See Vigil v. American Ins. Union, 37 N.M. 44, 47, 17 P.2d 936, 938 (1932) (Court need not acquiesce in erroneous statutory construction).

A

20. In construing the nature of these four statutory pension plans, we briefly look at the evolution of public pensions. Next, we consider how other jurisdictions have interpreted *297 their retirement plans. Then we examine our own statutes. Finally, we examine our prior rulings that have addressed any of the retirement programs.

21. In the late eighteenth century “[t]he unquestioned rule [was] that a pension granted by the public authorities [was] not a contractual obligation, but a gratuitous allowance, in the continuance of which the pensioner has no vested right.” Annotation, Vested Right of Pensioner to Pension, 54 A.L.R. 943, 943 (1928). Furthermore, “the notion that public employees had enforceable pension claims arising out of their employment would have grated harshly on the minds and ears of a nation decades removed from current and acceptable philosophies of governmental labor relations.” Rubin G. Cohn, Public Employee Retirement Plans the Nature of the Employees’ Rights, 1968 U.Ill.L.F. 32, 35-36. This view is exemplified in Pennie v. Reis, 132 U.S. 464, 470-72, 10 S. Ct. 149, 151, 33 L. Ed. 426 (1889) (because state retained contribution from employee’s salary and deposited money directly into retirement program, employee had no property interest in benefits).

22. A contrary view was introduced in 1904 when the New Jersey Supreme Court found that an amendment to a teacher’s retirement plan created a contractual relationship. Ball v. Board of Trustees, 71 N.J.L. 64, 58 A. 111 (1904).[4] The court based its decision on the fact that participation was voluntary and the terms of the relationship were specified in the statute. Id., 58 A. at 111-12.

23. These two views “have influenced the decisional law of pension rights to the present time. With few exceptions, and with an extraordinary demonstration of reverence for these first precedents, state courts continue their reliance on the main premises of these decisions.” Cohn, supra, at 37. The test frequently used to determine “the legal nature of the employees’ interest” is whether the plan features mandatory or voluntary participation; voluntary participation creates contractual rights and mandatory participation a gratuity. Id.

24. Under the voluntary/mandatory test, those employees who initially elected to participate in the pension plan would have contractual rights while employees hired after the enactment of mandatory participation provisions would have only “an expectancy.” Cohn, supra, at 42. Many state retirement programs were enacted as voluntary plans for those currently employed but were compulsory for new employees. Id., see NMSA 1941, § 3-1602 (Cum.Supp.1947). For example, in State ex rel. Public Employees Retirement Bd. v. Mechem, 58 N.M. 495, 273 P.2d 361 (1954), we acknowledged that under the statutory provisions in effect at the time, an educational employee could voluntarily belong to PERA in addition to the mandatory Teachers Retirement Association (TRA), the predecessor of ERA. Id. at 503, 273 P.2d at 365. Using the voluntary/mandatory test, the employee voluntarily joining PERA would have a contractual right to PERA benefits but only an expectancy in the TRA benefits. In addition, because PERA membership was optional for current employees and mandatory for all new state employees when enacted in 1947, see § 3-1602, existing employees would have a contractual right to benefits whereas new employees would only have an expectancy. Thus, under the voluntary/mandatory test, similarly situated employees under PERA would have significantly different rights. The absurdity of using the voluntary/mandatory test is self-evident, and we abandon it.

25. The modern trend generally agrees that the voluntary/mandatory test is archaic and inappropriate, see Pineman v. Oechslin, 195 Conn. 405, 488 A.2d 803, 808 (1985), cert. denied, 488 U.S. 824 (1988), especially because most state pension programs are contributory. See R.D. Hursh, Annotation, Vested Right of Pensioner to Pension, 52 A.L.R.2d 437, 442 (1957).

26. A few states have passed constitutional amendments protecting the contractual right of public employees to receive accrued pension benefits according to the terms under *298 which they accrued.[5] Others find a contractual right to receive pension benefits based on vesting language in their statutory retirement plans or by implication.[6]

27. The courts in Connecticut,[7] Maine,[8] Minnesota,[9] New Jersey,[10] and Rhode Island[11] have found expressly that statutory retirement plans do not create contractual rights. These states recognize that pensioners acquire an important property interest or right, but decline to find in the language of the statute a legislative intent to create a contract.

28. Connecticut has recognized a vested right to receive pension benefits created by statute, which accrues once a retiree satisfies the requirements for eligibility. See Pineman v. Oechslin, 488 A.2d at 810. This statutory right is protected “from arbitrary legislative action under the due process provisions of [the] state and federal constitutions.” Id. The court reasoned that finding a contract where there is no clear legislative intent to create one, and then finding that the contract can be unilaterally modified,

conflicts with basic contract law and contract clause analysis. It makes little sense to strain established rules of statutory interpretation to find a contract where the requisite express legislative intent is lacking, only to strain other equally well settled legal principles to allow for necessary unilateral modification by the state.

Id. at 809. The court also found the promissory estoppel approach inadequate because

[it] ignores the distinction traditionally made between private and public entities in determining the existence of contractual rights and obligations. “[C]ourts have consistently refused to give effect to government-fostered expectations that, had they arisen in the private sector, might well have formed the basis for a contract or an estoppel.” This distinction can be viewed as another way of articulating the requirement of an express legislative intent to contract. When the legislature intends to surrender its power of amendment and revision by creating a contract and thereby binding future legislatures, it must declare that intention in clear and unambiguous terms. A relinquishment of this authority should not occur by legislative inadvertence or judicial implication. To hold otherwise “requires the legislature and pension fund administrators to walk a tight rope whenever changes are indicated, and to accept risks which may turn into substantial financial obligations years after the fact.”

*299 Id. (emphasis added) (citation omitted) (quoting Kizas v. Webster, 707 F.2d 524, 535 (D.C.Cir.1983) & Rubin G. Cohn, Public Employee Retirement Plansthe Nature of Employees’ Rights, 1968 U.Ill.L.F. 32, 48).

29. Similarly, New Jersey has reasoned that mandatory retirement programs create neither contractual nor vested rights but possibly property rights in the retirement fund. See Spina v. Consolidated Police & Firemen’s Pension Fund Comm’n, 41 N.J. 391, 197 A.2d 169, 175-76 (1964). The New Jersey court held that pension benefits were not a gratuity within its constitutional ban on public donations.[12]Id., 197 A.2d at 175. The court declined to find contractual rights because the retirement fund, to be a contract, must guarantee the solvency of the fund so that “the expectations of all of the rank-and-file members” are met. Id. The recognition of the legislature’s potential need to unilaterally intervene to preserve the actuarial soundness of the retirement fund precludes implying a contractual obligation. Id. at 176. “[I]t seems odd to say the State may unilaterally rewrite its own contract…. We think it more accurate to acknowledge the inadequacy of the contractual concept.” Id.

30. With this background, we look at the language and circumstances of our four statutory retirement systems. As we begin, we reiterate that the tax exemption provisions were all contained within the freedom from service of process provisions in each plan. We are mindful that while the federal courts have the ultimate authority to determine whether a contract is protected from impairment by the federal contract clause, we are the final arbiters of whether a particular statute creates a contractual obligation under our state law. See Pineman v. Oechslin, 637 F.2d 601, 604-05 (2d Cir.1981) (finding state autonomy and principles of federalism would be impaired were federal courts to determine whether state intended to convey contractual rights to pensions). We will find a contract only where the language is clear and unambiguous, and we will resolve any uncertainty in favor of finding no contract.

B

31. For the sake of brevity, we review our four retirement programs together while recognizing that the language in each is somewhat different. We have examined carefully all four plans for any language that clearly and unambiguously create contractual rights. We have also examined the plans to determine whether the statutes confer any other rights to retirees and specifically whether the statutes confer rights to the tax exemptions. As discussed more fully below, we find no express language that clearly and unambiguously creates private contractual rights. However, because we find that three of the four plans expressly granted vested rights and that all four plans confer an absolute right to receive benefits upon accumulation of the requirements of the plans, we imply in all four plans a statutorily created property interest in receiving benefits. This interest vests upon fulfilling the minimum five years of service credits. This vested property right matures when the employee attains the age specified in the plan.

32. In 1947 the New Mexico Legislature enacted PERA. See NMSA 1941, § 3-1601 to -1628 (Cum.Supp.1947). JRA was included within the overall PERA retirement scheme. Sections 3-1624 to -1627. PERA membership was optional for employees existing when it was enacted but mandatory for all new public employees. See NMSA 1941, § 3-1602. Until the MRA was enacted in 1984, see NMSA 1978, § 10-12A-2(M) (Cum. Supp.1986), magistrate judges could elect to join PERA. When originally enacted, PERA stated that “nothing done hereunder shall create any contract rights to anyone, except the right to receive back accumulated deductions upon withdrawings from the public service.” Section 3-1605. The retirement board was granted authority to modify the “provisions for the management of the fund and affairs of the association … except that no increase may be made in the amount of *300 deductions from salaries or a decrease in the amount of retirement annuities payable, unless such action is approved by a majority vote of an annual or special meeting of the association.” Section 3-1623. PERA also included a tax exemption in the freedom from process provision that stated “the monies, annuities or other benefits mentioned in this act … shall be exempt from any state income tax.” Section 3-1619.

33. It is apparent from the plain language used that the original legislative intent of PERA was to preclude creating general contractual rights to benefits. It is equally apparent that the PERA retirement board expressly retained the power to modify the amount of employee contributions or the amount of benefits payable. That the legislature granted the board the right to modify benefits and payments is contrary to any intent to confer private contractual rights.

34. ERA was established in 1967 when the Teachers’ Retirement Act (TRA) was repealed. See NMSA 1953, Repl.Vol. 11, pt. 1 (1968) §§ 77-9-1 to -45. TRA was originally enacted in 1933, see 1933 N.M.Laws ch. 106, § 1, and reenacted in 1937, see NMSA 1929, §§ 120-1112 to -1116 (1938). The ERA retirement board was authorized to “adopt regulations pursuant to the Educational Retirement Act.” NMSA 1953, Repl.Vol. 11, pt. 1 (1968), § 77-9-6(E). The program was mandatory for regular members, although voluntary for provisional members. See §§ 77-9-16, -17, -2(B) & (H). ERA also included a provision precluding service of process and exempting “any state income tax” on “contributions or benefits.” See § 77-9-42. This provision was amended in 1987 in recognition of the community property nature of the benefits, see NMSA 1978, § 22-11-42 (Cum.Supp.1987), and in 1989 to permit service of process for child support obligations, see NMSA 1978, § 22-11-42 (Repl.Pamp.1989). ERA has never expressly granted either contractual or vested rights.

35. The first mention of creating any absolute right to receive benefits occurred in the 1971 amendment to JRA. The 1971 amendment stated that the JRA retirement allowance was “vested” upon meeting the required minimum age and years of earned service credits. See NMSA 1953, § 5-5-24 (Supp.1971); NMSA 1978, § 10-12-1(A) (Repl.Pamp.1990). JRA was separated from PERA when the legislature revised the statutes in 1978 and contained no provision that precluded service of process against the benefits or that granted a tax exemption. See NMSA 1978, §§ 10-12-1 to -15.

36. When MRA was enacted in 1984, it expressly created vested rights to benefits. The statute defined a “vested annuity” as the annual benefits a retiree would receive based on the salary during the last year prior to retirement and the total years of service. See § 10-12A-2(M) (Cum.Supp.1986). The retirement board was granted broad authority to promulgate rules and regulations. See § 10-12A-3(A). The MRA included a provision precluding service of process and exempting from “any state income tax” the “money, annuities or other benefits.” See NMSA 1978, § 10-12A-12 (Repl.Pamp.1987).

37. The only other mention of vested rights occurred in 1987 when PERA was reenacted. This new provision granted employees with five or more years of credited service a vested right in membership upon termination of employment provided the employees did not withdraw their individual contributions. See § 10-11-9 (Repl. Pamp.1987). The reenactment modified the freedom from service of process provision, recognizing that PERA benefits are community property. See NMSA 1978, § 10-11-136. In 1989 the PERA freedom from process provision was again modified to permit service of process for child support obligations. See NMSA 1978, § 10-11-136.1 (Cum.Supp.1989); § 10-12-18. JRA was also amended in 1989 by adding a freedom from process provision that recognized benefits were community property and stating that “pensions or other benefits … shall be exempt from state income tax.” Thus, JRA was comparable to the other state retirement plans.

38. All four plans were amended in 1990 when the tax exemptions contained in the freedom from process provisions were repealed. Amendments in 1992 repealed the *301 vesting language in both JRA and MRA.[13] The 1992 amendment to JRA also permitted service of process for child support obligations. See § 10-12B-7 (Repl.Pamp.1992). Thus all four plans recognize the community property nature of retirement benefits and permit service of process for child support. Only PERA retains any mention of vested rights. See § 10-11-9.

39. We have thoroughly examined the language of the original versions of the acts and the various amendments. Unlike Board of County Commissioners v. New Mexico & Southern Pacific Railroad, 3 N.M. 126, 135, 2 P. 376, 380-81 (1884), in which the Court found that the state’s promise of a tax exemption in exchange for building and operating rail services in New Mexico constituted a unilateral contract, we find no language in any plan that clearly and unambiguously promises to grant specific retirement benefits in exchange for specific services. Rather, when enacted, PERA expressly stated that it was not granting any contractual rights except the right to withdraw individual contributions upon termination of employment. The right to receive benefits under the present plans is merely an expectancy until an employee has earned five years of service credits. Unlike some states, we have no constitutional language creating a contractual right to retirement benefits. Likewise, we find no statutory language in any of the plans that clearly and unambiguously spells out a contract between the State and its employees.

40. Appellants do not claim an express contract exists but rely on dicta in our prior decisions. Likewise, they rely on law from other jurisdictions. We recognize that “there is a seductive appeal in the contract-oriented approaches adopted by other jurisdictions.” Pineman, 488 A.2d at 808. However, under our rules of statutory construction, “[c]ontractual rights are not created by statute unless `the language of the statute and the circumstances … manifest a legislative intent to create private rights of a contractual nature enforceable against the State.'” Whitely, 115 N.M. at 312, 850 P.2d at 1015 (quoting Wage Appeal v. Board of Personnel Appeals, 208 Mont. 33, 676 P.2d 194, 199 (1984)). There is no clear and unambiguous legislative intent in any of the four plans to create private contractual rights.

41. If the right to receive retirement benefits was conferred by a private rather than a public employer, we would imply contractual rights. See Ruggles v. Ruggles, 114 N.M. 63, 70, 834 P.2d 940, 947 (Ct.App.1992) (agreeing that right to collect pension from private employer is contract right). However, there is a “distinction traditionally made between private and public entities in determining the existence of contractual rights and obligations.” Pineman, 488 A.2d at 809. We decline to imply private contractual rights enforceable against the State. Whitely, 115 N.M. at 312, 850 P.2d at 1015. To do so would play “havoc with basic principles of contract law, traditional contract clause analysis and, most importantly, the fundamental legislative prerogative to reserve to itself the implicit power of statutory amendment and modification.” Pineman, 488 A.2d at 808.

42. We do find that all four retirement plans grant employees a substantive right to receive retirement benefits upon meeting certain requirements. PERA, JRA, and MRA have expressly acknowledged that rights to receive benefits vest upon fulfilling the terms of the plans, although the vesting language has now been withdrawn from JRA and MRA. Furthermore, in all four retirement programs, the language of the statutes confers an absolute right to receive some form of retirement benefits upon fulfilling the requirements of the plan. This statutorily granted power “to do certain actions or possess certain things lawfully” confers a vested right. See Rubalcava, 53 N.M. at 298, 206 P.2d at 1156.

43. Therefore, we find that the express language of the statutes initially creates an expectancy, or property interest, in receiving benefits. Cf. Board of Regents v. Roth, 408 *302 U.S. 564, 577, 92 S. Ct. 2701, 2709, 33 L. Ed. 2d 548 (1972) (property laws protect “legitimate claim of entitlement”). All four programs require a minimum of five years of earned service credits before an employee is eligible to receive benefits. The only other condition of eligibility is reaching a specified age. Therefore, based on an absolute right to receive some form of benefits after earning five years of service credits, we may infer that the statutes create vested property rights, but that these rights do not mature until the final statutory condition is met. Copeland v. Copeland, 91 N.M. 409, 412, 575 P.2d 99, 102 (1978). Although we find vested rights, we do not find contractual rights. Statutes, like contracts and the common law, may confer vested property rights. Rubalcava, 53 N.M. at 298, 206 P.2d at 1156.

44. The specific amount of benefits to be received are indeterminate at the time the property right vests. Cf. NMSA 1978, § 10-11-9(B) (Repl.Pamp.1987) (terms of vested rights determined according to provisions in effect at time of termination). The details of the vested rights are to be determined by the statutes in effect at the time of maturity. Copeland, 91 N.M. at 412 & n. 1, 575 P.2d at 102 & n. 1. Where the statutes are silent, we find that maturity occurs when the terms for retirement have been met. Id. The legislature may choose to establish a different point of maturity.

45. Having found no contractual rights to receive benefits, we need not examine the tax exemption provisions to determine whether they confer private contractual rights. However, having found that the four retirement plans create vested rights to receive benefits, we examine the tax exemption provisions to determine whether the plans include a vested right to receive the benefits free from taxation. We find no vested right to tax exemptions.

46. We agree with Appellants that the language of the statutes indicates an intent to create tax exemptions.[14]See Flaska v. State, 51 N.M. 13, 24, 177 P.2d 174, 181 (1946) (legislative intent to grant exemption must be expressed in clear and unambiguous terms). We disagree that the statutes indicate a clear and unambiguous legislative intent to create irrevocable or vested tax exemptions. The power to tax is a fundamental governmental power that should not be diminished where there are other reasonable constructions of the statute. Herrick, 391 N.E.2d at 733. “As a general rule, if a right is based solely upon a statute, there being no such right at common law, the repeal of the statute abolishes the right, unless the repealing statute includes a saving clause or unless the right has vested.” Rodgers v. City of Loving, 91 N.M. 306, 308, 573 P.2d 240, 242 (Ct.App. 1977).

47. Although the substantive right to receive benefits confers a property right upon vesting, the tax exemptions are not contained within the provisions defining the substantive rights of employees to receive benefits. Rather, the exemptions are included in the freedom from service of process provisions. These provisions reflect current public policy to protect retirement benefits from attachment by creditors. “Policies, unlike contracts, are inherently subject to revision and repeal, and to construe laws as contracts when the obligation is not clearly and unequivocally expressed would be to limit drastically the essential powers of a legislative body.” National R.R. Passenger Corp. v. Atchison, Topeka & Santa Fe Ry., 470 U.S. 451, 466, 105 S. Ct. 1441, 1451, 84 L. Ed. 2d 432 (1985). The “`law is not intended to create private contractual or vested rights but merely declares a policy to be pursued until the legislature shall ordain otherwise.’ This well-established presumption is grounded in the elementary proposition that the principal function of a legislature is not to make contracts, but to make laws that *303 establish the policy of the state.” Id. (citations omitted).

48. A legislative intent to confer contractual or vested rights is especially suspect where the tax exemptions are included in non-substantive provisions such as the freedom from process provisions. We agree with the Attorney General that the state by granting tax exemptions was expressing its concern “that for the most part persons drawing state retirement benefits are those of advanced age whose economic situation in living on a small fixed income in a period of rising prices is already perilous.” N.M.Att’y Gen.Op. 62-13 (1962) (determining that 1961 amendment of tax code did not repeal PERA tax exemption provision). We presume that statutes establish current public policy subject to legislative revision rather than creating either contractual or vested rights. Whitely v. New Mexico State Personnel Bd., 115 N.M. at 312, 850 P.2d at 1015; see also United States Trust v. New Jersey, 431 U.S. 1, 17 n. 14, 97 S. Ct. 1505, 1515 n. 14, 52 L. Ed. 2d 92 (1976) (stating that statutes do not create a private contractual right unless language and circumstances clearly indicate otherwise). In fact, all the freedom from process provisions have been modified to recognize the community property nature of retirement benefits and to provide for service of process to enforce child support obligations, reflecting changes in current public policy.

49. Therefore, after careful review, we find no clear and unambiguous intent to create either private contractual or vested rights in the tax exemptions under any of the four retirement programs. This is not inconsistent with our prior holdings.

C

50. Appellants argue that we have “consistently discussed the pension rights of public employees as contractual.” In State ex rel. Sena v. Trujillo, 46 N.M. 361, 367, 129 P.2d 329, 332 (1942), we noted that the Supreme Court of California had held that “where services are rendered under the pension statute … the pension provisions `become a part of the contemplated compensation for those services, and so in a sense a part of the contract of employment itself.'” Id. (quoting O’Dea v. Cook, 176 Cal. 659, 169 P. 366, 367 (1917)). However, the question before the Court in Trujillo was whether the 1941 pension act granting $125.00 per month for all state employees who reached the age of 65 and had worked for the state for thirty consecutive years applied retroactively to a person who had left state employment ten years prior to the passage of the act. The Court did not expressly decide whether the 1941 pension system was contractual in nature but, rather, found that retroactive application of the pension in this situation violated the constitutional prohibitions against private donations and extra compensation after services were rendered. Id. at 369, 129 P.2d at 333; N.M. Const. art. IX, § 14; art. IV, §§ 27, 31.

51. We also have held that the 1953 enactment of PERA did not violate our constitutional prohibition against granting public employees extra compensation where retirees voluntarily made small lump-sum contributions in exchange for significant increases in benefits. See Hudgins, 58 N.M. at 546, 273 P.2d at 745; N.M. Const. art. IV, § 27. In Hudgins we cited with approval Raines v. Board of Trustees, 365 Ill. 610, 7 N.E.2d 489, 491 (1937), concluding that voluntary, as opposed to mandatory, contributions created a contractual relationship similar to an insurance annuity contract. Hudgins, 58 N.M. at 547-48, 273 P.2d at 746-47. As noted above, we now expressly reject this voluntary/mandatory test. The issues before the Court in Hudgins were whether the increased retirement benefits violated our constitutional bans on public donations, appropriating public money for private use, or granting extra compensation to public officers. The general nature of our four retirement programs was not before the Court.

52. We recognized a community property interest in “`vested’ but `unmatured'” public employee benefits that is now codified in all four retirement programs. See Copeland, 91 N.M. at 412, 575 P.2d at 102. In Copeland we explained that a vested right to PERA pension benefits is a property right that is “entitled to constitutional protection as for example against taking without due process *304 of law…. When the requirements of vesting have once been met, no longer may the employer unilaterally terminate, diminish or alter the vested rights.” Id.

53. In Whitely v. New Mexico State Personnel Board, 115 N.M. at 312, 850 P.2d at 1015, we stated that

statutes fixing the compensation or terms of public employment are presumed merely to establish public policy subject to legislative revision, and not to create contractual or vested rights. Contractual rights are not created by statute unless “the language of the statute and the circumstances… manifest a legislative intent to create private rights of a contractual nature enforceable against the State.”

Id. (quoting Wage Appeal v. Board of Personnel Appeals, 208 Mont. 33, 676 P.2d 194, 199 (1984)) (citation omitted) (emphasis added). Because we have expressly stated that employees have no contractual rights to specific compensation or terms of employment, it seems illogical to find contractual rights to retirement benefits. We will not infer “a legislative intent to create private rights of a contractual nature enforceable against the State” unless the legislative intent is clearly and unambiguously stated. Id.

54. As we have explained in Copeland, public retirement plans create a property interest upon vesting that matures upon fulfilling the conditions for retirement. 91 N.M. at 412, 575 P.2d at 102. Under both the state and federal constitutions, property may not be taken without just compensation. See N.M. Const. art. II, § 20; U.S. Const. amend. XIV, incorporating amend. V; see also Keystone Bituminous Coal Ass’n v. DeBenedictis, 480 U.S. 470, 481 n. 10, 107 S. Ct. 1232, 1240 n. 10, 94 L. Ed. 2d 472 (1987) (holding that Fourteenth Amendment incorporates Fifth Amendment prohibition against taking of property). Thus, any action by the legislature that serves “to terminate, diminish or alter” the value of pension benefits, Copeland, 91 N.M. at 412, 575 P.2d at 102, must be compensated for by providing an equal or greater benefit.

55. Property rights are also protected under the due process and equal protection clauses. See N.M. Const. art. II, § 18; U.S. Const. amend. XIV, § 1. Before the legislature may substantially alter the level of retirement benefits, it must provide employees and retirees with adequate notice and an opportunity to respond. See Reid v. New Mexico Bd. of Examiners, 92 N.M. 414, 415-16, 589 P.2d 198, 199-200 (1979) (stating that due process requires notice and opportunity to be heard prior to any deprivation of property right). While we find today that newspaper publication is sufficient notice of the legislature’s intent to repeal the tax exemption provisions and that open legislative committee meetings provide adequate opportunity to respond, our holding is based on our conclusion that there is no vested right to receive pension benefits free from tax. When the legislature attempts to impair a vested property right, however, the notice and opportunity to respond must be “reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections.” Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314, 70 S. Ct. 652, 657, 94 L. Ed. 865 (1950).

56. We agree with the New Jersey Supreme Court that “[t]he responsibility for creating public contracts is the Legislature’s. A commitment of that kind should be so plainly expressed that one cannot doubt the individual legislator understood and intended it.” Spina, 197 A.2d at 176. Our four retirement plans do not clearly and unambiguously create private contractual rights. We decline to join those states that find a contractual relationship where one does not clearly and unambiguously exist and that proceed to justify how the legislature may nonetheless unilaterally modify this contract without the consent of the participants. The legislature may choose to expressly provide New Mexico state employees with a contractual right to retirement benefits. However, until it does so, we will not read such a right into the statutes.

57. Neither our case law nor the four statutory retirement plans clearly and unambiguously grant private contractual rights to state employees or retirees. Therefore, we *305 find the tax exemption provisions under consideration likewise do not confer contractual rights. Because we find no contractual rights, we find no impairment or breach of contract resulting from the repeal of the tax exemption provisions in the four retirement plans. Although we find the four retirement plans confer property rights that vest upon accumulating the minimum earned service credits, we find these rights do not include the right to receive pension benefits exempt from tax.

D

58. We now address whether Appellants received sufficient due process before the tax exemptions were repealed. Appellants argue that there was insufficient notice and opportunity to be heard. Appellee notes that the legislative committee meetings were open to the general public and that the retirees could attend and testify. Therefore, Appellees argue there was no violation of due process. We agree.

59. Determining what procedural protections are due requires weighing several factors. Mathews v. Eldridge, 424 U.S. 319, 335, 96 S. Ct. 893, 903, 47 L. Ed. 2d 18 (1976). Our first task is to determine the nature and significance of the private interest. See Zinermon v. Burch, 494 U.S. 113, 127, 110 S. Ct. 975, 984, 108 L. Ed. 2d 100 (1989). Next, we assess the risk of an erroneous deprivation under the procedures available and what value any additional safeguards would provide. Finally, we examine the competing state interests. Id. In other words, “[h]aving identified the property interest, we must determine what process is due it.” New Mexico Indus. Energy Consumers v. New Mexico Pub. Serv. Comm’n, 104 N.M. 565, 567, 725 P.2d 244, 246 (1986). Due process is “an embodiment of fundamental ideas of fair play and justice.” Erwin v. City of Santa Fe, 115 N.M. 596, 599, 855 P.2d 1060, 1063 (Ct.App.1993).

60. Notice of the legislative intent to repeal the tax exemptions was publicized in the local newspapers. The committee meetings discussing the repeal were open to the general public. However, the private interests under consideration are statutorily granted tax exemptions on retirement benefits. The four retirement plans provide no contractual or vested rights to receive irrevocable tax exemptions. Therefore, where there is no constitutionally protected private interest in the tax exemptions, we find no due process violation. See Zinermon, 494 U.S. at 127, 110 S. Ct. at 984.

IV

61. Appellants also assert that the court erred in admitting Appellee’s Exhibit B consisting of Taxation and Revenue Secretary Dick Minzner’s affidavit and five newspaper articles. We defer to the trial court when determining what evidence may be admitted and will reverse only upon finding an abuse of discretion. We will find an abuse of discretion when the “court’s decision is clearly untenable or contrary to logic and reason.” Newsome v. Farer, 103 N.M. 415, 420, 708 P.2d 327, 332 (1985). Appellants contend that the newspaper articles were inadmissible hearsay and not appropriate exhibits to a motion for summary judgment. Further, they argue that Minzner’s affidavit constituted an after-the-fact statement about the legislative history of Senate Bill 310. See Whitely v. New Mexico State Personnel Bd., 115 N.M. at 313-14, 850 P.2d at 1016-17 (holding that statements by individual legislator made after enactment not admissible to show legislative intent). We might agree with Appellants had the exhibit been introduced solely to prove legislative intent.

62. However, as discussed above, an important question before the court was whether the constitutional requirements of due process had been met. Minzner’s affidavit presented the chronology of events as evidence that notice of the committee meetings had been given and that the press accurately reported the activities of the committee meetings. Notwithstanding dicta in State ex rel. Helman v. Gallegos, 117 N.M. 346, 355-56, 871 P.2d 1352, 1361-62 (1994) (contemporaneous documents actually submitted to legislature may be admitted to show legislative intent where statutory meaning unclear), we have consistently held that it is inappropriate to introduce subsequent affidavits solely for *306 the purpose of showing legislative intent. However, Minzner’s affidavit was not introduced solely to show legislative intent, and it was limited to personal knowledge. Cf. Whitely v. New Mexico State Personnel Bd., 115 N.M. at 314, 850 P.2d at 1017 (statement inadmissible because it was not based on personal knowledge). The attached newspaper articles were relevant to show that Senate Bill 310 was adequately publicized. We find no error in admitting the affidavit and newspaper articles for the limited purpose of proving that adequate notice of the contents of Senate Bill 310 was given to meet the constitutional requirements for due process.

V

63. We next consider Appellants’ argument that the title to Senate Bill 310, 1990 N.M.Laws, ch. 49, was constitutionally defective in failing to state the true and full title to the bill.[15] The title to Senate Bill 310 reads: “An Act Relating to Taxation; Changing Certain Provisions of the Income Tax Act and the Corporate Income and Franchise Tax Act; Amending and Repealing Certain Sections of the NMSA 1978.” Appellants argue that the title is invalid because it specifically referenced the Income Tax Act and Corporate Income and Franchise Act whereas it also amended PERA, JRA, MRA, and ERA. We disagree.

64. Where there is ambiguity, we indulge every presumption in favor of the validity of a statute. See United States Brewers Ass’n v. Director, N.M. Dep’t of Alcoholic Beverage Control, 100 N.M. 216, 219, 668 P.2d 1093, 1096 (1983). We do not require “the title to a legislative enactment… be an index of everything in the act itself” so long as the title “give[s] notice of the subject matter of the legislation.” In re Estate of Welch, 80 N.M. 448, 449, 457 P.2d 380, 381 (1969). “Likewise, we have held that the fact that an act may amend certain provisions of other statutes by implication, does not in and of itself violate Section 18.” U.S. Brewers Ass’n, 100 N.M. at 219, 668 P.2d at 1096 (citing N.M. Const. art. IV, § 18 (“No law shall be revised or amended, or the provisions thereof extended by reference to its title only; but each section thereof as revised, amended or extended shall be set out in full.”)).

65. Appellants’ reliance on State ex rel. Salazar v. Humble Oil & Refining Co., 55 N.M. 395, 234 P.2d 339 (1951), and Bureau of Revenue v. Dale J. Bellamah Corp., 82 N.M. 13, 474 P.2d 499 (1970), is misplaced. In Humble the Court found that a bill was unconstitutional because its title expressly referenced select excise taxes on natural resources but also included a provision to establish a permanent fund for severance taxes. 55 N.M. at 419, 234 P.2d at 342, 355-56. The Court noted that the title would have been sufficient had it been stated in general terms. Id. However, when specific sections were identified, yet a provision outside the scope of the title was included, the bill was invalid and void. Id. at 420-21, 234 P.2d at 356. The Court quoted State v. Miller, 33 N.M. 200, 203, 263 P. 510, 511 (1927), that “[t]he purposes of the constitutional provisions are to prevent surreptitious `log-rolling’ legislation and to give general notice to all concerned of the character of proposed legislation.” Humble, 55 N.M. at 419, 234 P.2d at 355. In Miller we stated that while constitutional provisions are mandatory, we will liberally construe the provisions so as not to impede the legislature. Miller, 33 N.M. at 203, 263 P. at 511. The legislature is the proper body to determine the title of a bill. Id. Where there is any doubt as to the “sufficiency of the title, it must be upheld.” Id. The Court in Bellamah likewise found a bill to be invalid based on the fact that the title alerted the reader only to the possibility of imposing a statute of limitations on the collection of taxes on oil and gas businesses under the new Oil and Gas Emergency School Tax Act even though the bill also applied the statute of limitations to the collection of taxes from other sources under the old Emergency School Tax Act. Bellamah, 82 N.M. at 15-16, 474 P.2d at 501-02. When the legislature intends to amend a prior act, *307 “that amendatory act must be germane to the subject matter of the section sought to be amended.” Id. at 16-17, 474 P.2d at 502-03.

66. The title to Senate Bill 310 on its face encompassed all New Mexico statutes that could be affected by the income tax or the Corporate Income and Franchise Act. Thus, this title placed on notice anyone potentially liable for income taxes. It is clear that the four retirement programs were modified only as to income tax related provisions. The “amendatory act” was “germane” to the income tax exemptions contained in the four retirement plans. Bellamah, 82 N.M. at 17, 474 P.2d at 503. There was no “fraud or surprise by means of concealed or hidden provisions in [the] act which the title fail[ed] to express.” Ballew v. Denson, 63 N.M. 370, 372, 320 P.2d 382, 383 (1958). Indulging all presumptions in favor of the validity of the legislative act, we find the title sufficiently related to the contents of the bill to pass muster on constitutional grounds.

VI

67. Finally, we address whether the court erred by awarding Appellee its costs, specifically as to the two affidavits submitted in support of the motion for summary judgment. Appellants question the award of costs because the two witnesses merely submitted affidavits, the affidavits did not contain sufficient information to qualify them as experts, and Appellants did not have an opportunity to cross-examine them concerning their qualifications or findings. Furthermore, Appellants argue that the costs included fees for clerical staff, contrary to the requirements of NMSA 1978, Section 38-6-4 (Repl.Pamp.1987). In Jimenez v. Foundation Reserve Ins. Co., 107 N.M. 322, 327, 757 P.2d 792, 797 (1988), we required that a witness qualify as an expert and testify either at trial or by deposition in order to support an award of expert witness fees. We based our decision on the fact that the “right of a prevailing party to recover costs incurred in litigation is by virtue of statutory authority, or by rule of the court as authorized by statute.” Id.

68. Appellee argues that while costs may be limited under Section 38-6-4, no such limitation applies under SCRA 1986, 1-054(E) (Repl.Pamp.1992). We disagree. Although we have imposed no limitations on the discretion of a court to award costs under SCRA 1-054(E), we have cautioned district courts to “exercise this discretion sparingly when considering expenses not specifically authorized by statute and precedent.” Dunleavy v. Miller, 116 N.M. 353, 363, 862 P.2d 1212, 1222 (1991).

69. This Court has not had the opportunity to address whether the expense of preparing affidavits in support of a summary judgment may be included in an award of costs. An award of costs for the preparation of an affidavit, including costs for clerical support, is not authorized by statute or precedent. The expenses associated with preparing an affidavit for summary judgment are preliminary expenses not directly associated with trial. Under the circumstances of this case, we find the trial court abused its discretion in awarding costs to Appellee for preparation of the affidavits. Therefore, we reverse and remand to the trial court to enter judgment disallowing such costs.

VII

70. In conclusion, we find that the four statutory retirement programs do not grant Appellants private contractual rights. The four retirement programs create a property interest in individual contributions to the retirement programs and to the funds in the retirement programs. Upon acquiring the minimum number of service credits, state employees have vested but unmatured property rights in retirement benefits. These vested rights did not include the repealed tax exemptions. Based on our finding of no contractual right to retirement benefits, we find no contractual right to the repealed tax exemptions. Therefore, we find no impairment of contract under either the New Mexico or Federal Constitution.

71. In addition, we find no constitutional infirmity in the title of Senate Bill 310. We find no abuse of discretion by the court in admitting Minzner’s affidavit to which newspaper articles were attached. However, we do find an abuse of discretion in the court’s *308 award of costs to Appellee for the preparation of affidavits used in its motion for summary judgment. We affirm in part and reverse in part.

72. IT IS SO ORDERED.

RANSOM, J., and DIANE DAL SANTO, District Judge (Sitting by Designation), concur.

NOTES

[1] In addition to Michigan and New Mexico, we note that 22 other states have addressed discriminatory tax exemption provisions: Alabama, Arizona, Arkansas, Colorado, Georgia, Iowa, Kansas, Kentucky, Maryland, Massachusetts, Mississippi, Missouri, Montana, New York, North Carolina, Oklahoma, Oregon, South Carolina, Utah, Virginia, West Virginia, and Wisconsin. In addition, Maine, Rhode Island, and Ohio discussed the effect of a repeal of a statutory tax exemption for retirees before the Davis decision. Although we find no case law, Louisiana recently revised its state retirement plan but appears to have retained the disparate tax exemption provisions. See La.Rev.Stat.Ann. §§ 11:405, :570, :930, :1331(B) (West 1993).

[2] Colorado, Georgia, Maine, Montana, North Carolina, Ohio, Oregon, and Rhode Island. Maine, Ohio, and Rhode Island considered the question before the Davis decision. North Carolina dismissed the claim based on the failure of the retirees to properly follow statutorily mandated refund procedures. See Bailey v. State, 330 N.C. 227, 412 S.E.2d 295, 300-03 (1991), cert. denied, 504 U.S. 911, 112 S. Ct. 1942, 118 L. Ed. 2d 547 (1992). Both Maine, see Blair v. State Tax Assessor, 485 A.2d 957960 (Me.1984), and Rhode Island, see Linnane v. Clark, 557 A.2d 477477, 479-80 (R.I.1989), found the exemptions were repealed by implication following extensive revisions of their general tax codes. Colorado found that the exemption was not contractual where it was contained only in the general tax code. See Spradling v. Colorado Dep’t of Revenue, 870 P.2d 521, 524 (Colo.Ct.App.1993), cert. denied, Apr. 4, 1994. Montana found no contract based on the use of the present tense, “are,” and its constitutional prohibition against granting an irrevocable tax exemption. See Sheehy v. Public Employees Retirement Div., 262 Mont. 129, 864 P.2d 762, 765-76 (1993).

[3] The relevant sections of both Ohio Rev.Code Ann. § 145.56 (Baldwin 1994) and 3307.71 (Baldwin 1995) read: “The right of a person to a pension, an annuity, or retirement allowance itself… and all moneys and investments and income thereof, are exempt from any state tax.”

[4] It is interesting to note that New Jersey has turned away from this contractual concept. See Spina v. Consolidated Police & Firemen’s Pension Fund Comm’n, 41 N.J. 391, 197 A.2d 169 (1964).

[5] See, e.g., Alaska Const. art. XII, § 7 (accrued benefits protected as contractual rights); Hawaii Const. art. XVI, § 2 (same); Ill. Const. art. 13, § 5 (membership enforceable as contractual right); Mich. Const. art. IX, § 24 (accrued financial benefits create contractual obligation); N.Y. Const. art. V, § 7 (membership creates contractual relationship).

[6] States finding contractual rights to retirement benefits then must address the need of legislatures to modify the statutory retirement plans. Three states, Arizona, Georgia, and Pennsylvania, follow a strict contract theory that precludes modification of the retirement plan. Other states follow either the “California Rule,” permitting broad flexibility provided any reduction of benefits is offset by equal or greater advantages, or the “Pennsylvania Rule” (now abandoned by Pennsylvania), permitting only modifications that enhance the actuarial soundness of the retirement fund.

[7] Pineman v. Oechslin, 195 Conn. 405, 488 A.2d 803, 808 (1985) (discussed below), cert. denied, 488 U.S. 824, 109 S. Ct. 72, 102 L. Ed. 2d 48 (1988).

[8] Spiller v. State, 627 A.2d 513, 516-17 & n. 12 (Me.1993) (declining to imply contractual rights where no intent expressed in statutory language; retirement program merely reflection of public policy although state employees have “legitimate retirement expectations” entitling them to due process).

[9] Christensen v. Minneapolis Mun. Employees Retirement Bd., 331 N.W.2d 740, 746-48 (Minn. 1983) (holding that promissory estoppel precludes arbitrary changes to retirement plan; however, public interests of state in modifying pension plan may be superior to employees’ entitlement rights).

[10] Spina v. Consolidated Police & Firemen’s Pension Fund Comm’n, 41 N.J. 391, 197 A.2d 169, 176 (1964) (discussed below).

[11] In re Almeida, 611 A.2d 1375, 1384 (R.I.1992) (declining to categorize pensions but recognizing pension comprises elements of both deferred compensation and contract theories).

[12] We likewise reject the argument that statutorily conferred pension benefits are a gratuity within our constitutional prohibition on public donations. See N.M. Const. art. IV, §§ 27, 31; art. IX, § 14.

[13] We express no opinion as to the constitutionality of the withdrawal of vested rights because the issue is not before the Court.

[14] We recognize that the Court of Appeals determined that contributions into the ERA retirement fund were exempt from taxation, as well as the benefits. See Vaughn v. State Taxation & Revenue Dep’t, 98 N.M. 362, 366, 648 P.2d 820, 824 (Ct.App.1982). The Court based its decision on the existing statutory scheme that reflected a public policy of permitting tax exemptions for retirement benefits. While valid when decided, Vaughn would now be incorrect because public policy has changed as reflected by the amended statutes.

[15] “The subject of every bill shall be clearly expressed in its title … but if any subject is embraced in any act which is not expressed in its title, only so much of the act as is not so expressed shall be void.” N.M. Const. art. IV, § 16.

LOS ALAMOS MEDICAL CENTER, Inc., a Corporation, Cross-Appellee, v. Joseph S. COE, Jean S. Coe, Appellees and Cross-Appellants, charles A. Behney, Appellant.

LOS ALAMOS MEDICAL CENTER, Inc., a Corporation, Cross-Appellee, v. Joseph S. COE, Jean S. Coe, Appellees and Cross-Appellants, charles A. Behney, Appellant.

No. 5712.

Supreme Court of New Mexico.

September 8, 1954.

Rehearing Denied November 4, 1954.

*176 F.A. Catron and Thomas B. Catron, III, Santa Fe, for appellant and cross-appellee.

A.L. Zinn, Dean S. Zinn and Frank B. Zinn, Santa Fe, for appellees and cross-appellants.

COMPTON, Justice.

This is an appeal from a judgment awarding damages for injuries allegedly resulting from malpractice. The action was orginally brought by Los Alamos Medical Center, Inc. against appellee, Joseph S. Coe, on account. On motion, appellee Jean S. Coe, his wife, was made a cross complainant, and appellant and Dr. Roscoe S. Wilcox were made cross-defendants. The account was not disputed and judgment was rendered accordingly. By counterclaim appellees alleged that the Medical Center, through its employees Dr. Wilcox and appellant Behney, negligently administered and prescribed morphine for self-administration without supervision in such amounts and frequency as to cause her addiction. It is alleged that as a result of her addiction, her health was greatly impaired and that she suffered great pain in effecting a “withdrawal.” They seek damages for such wrongful acts. The husband seeks consequential damages for loss of consortium of his wife and for medical expenses in a separate amount. The cross-defendants filed separate answers denying her addiction and their negligence as a cause thereof. Dr. Behney further alleges that all morphine prescribed or administered by him was made upon the insistent demands of appellees after having warned them of the dangers incident to the use of such drug; that if he were negligent, the Coes were guilty of contributory negligence as a proximate cause of the alleged injuries. Dr. Wilcox, and likewise the Medical Center, urged the same defenses as Dr. Behney. The Medical Center as a further defense pleaded immunity from liability by reason of being a non-profit corporation, engaged in the operation of a hospital and medical center for the purpose of providing medical, dental and hospital services and care without profit. At the close of the evidence, the cause was dismissed as to Dr. Wilcox. The issues were submitted to a jury which returned its verdict in favor of the Medical Center, and awarded both compensatory and punitive damages against Dr. Behney. Judgment was entered on the verdict and Dr. Behney brings the judgment here for review.

The main question is the sufficiency of the evidence to sustain the verdict. In this regard, all conflicts in the evidence must be resolved in favor of the successful party and all reasonable inferences indulged in to support the judgment, and all evidence and inferences to the contrary must be disregarded. Little v. Johnson, 56 N.M. 232, 242 P.2d 1000. Mrs. Coe was admitted to the hospital on several occasions. On March 28, 1950, she was admitted for dilation and curettage. She again entered the hospital April 16, 1950 for similar treatment. On June 6, 1950, she was admitted for a major operation, separation of adhesions and supra-vaginal hysterectomy. The latter operation was performed by appellant. Subsequently, on June 13, 1950, she entered the hospital for removal of intestinal obstructions and was finally discharged therefrom July 15, 1950. During all this time she received narcotics in some form or another. It seems Dr. Behney did not perform the latter operation, nevertheless, Mrs. Coe again became his patient on July 25 and remained such until November 3, 1950, at which time she went to Los Angeles, California and entered the Good Samaritan Hospital in Los Angeles, California, where she was diagnosed as a morphine addict after surgery. The amount, kind and quantity of narcotics prescribed and used by Mrs. Coe as shown by the hospital records is as follows:

*177
"DATE      DRUG              DOSE          QUANTITY         DOCTOR
---------------------------------------------------------------------------
3-28-50    Demerol           .05              12            Shafer
4-4-50       "               .05               3            Behney
4-8-50
4-14-50    Codein            .061             12            Behney
4-15-50    Demerol           .05               3            Behney
4-18-50    M.S.              .011             10            Behney
4-18-50    Codein            .032             10            Behney
4-21-50    M.S.              .011             10            Behney
4-25-50    M.S.              .011             12            Behney
4-27-50    " "               .011             12            Behney
4-27-50    Demerol           .05              30            Behney
5-2-50     M.S.              .011             12            Behney
5-24-50    " "               .014              6            Shafer
5-26-50    " "               .016              6            Hawley
6-6-50
6-13-50
7-22-50    M.S.              .008             10            Wilcox
7-28-50    " "               .011             20            Behney
8-2-50     " "               gr. 1/6          20            Behney
8-5-50     Demerol           .05              30            Behney
8-6-50     M.S.              gr. 1/6          20            Hawley
8-11-50    " "               gr. 1/6          20            Hawley
8-15-50    " "               gr. 1/6          15            Hawley
8-17-50    " "               .011             20            Behney
8-25-50    " "               .011             20            Behney
8-28-50    " "               .011             20            Behney
8-28-50    Codein (APC)      .032             20            Behney
9-1-50     M.S.              .011             20            Behney
9-5-50     " "               .011             20            Behney
9-5-50     Codein (APC)      .032             30            Behney
9-8-50     M.S.              .011             20            Behney
9-12-50    " "               .011             20            Behney
9-20-50    " "               .011             20            Behney
9-23-50    " "               .011             20            Behney
9-27-50    " "               .011             20            Behney
9-29-50    M.S.              .011             20            Behney
10-2-50    " "               .011             20            Behney
10-5-50    " "               .011             20            Behney
10-7-50    M.S. Sol.         20cc- .210                     Behney
10-12-50   "     "           20cc-G.210                     Behney
10-16-50   M.S. Sol.         20cc- .200                     Behney
10-18-50    "    "           20cc- .194                     Behney
10-23-50    "    "           20cc- .194                     Behney
10-26-50    "    "           20cc- .194                     Behney
10-27-50    "    "           20cc- .194                     Behney
10-31-50    "    "           20cc- .194                     Behney"

As previously stated, Mrs. Coe became Dr. Behney’s patient on July 25, 1950, the date she was discharged from the Medical Center. After returning to her home she began to complain of severe pains and appellees consulted Dr. Behney about self-administration of narcotics at home and this was agreeable to Dr. Behney. The husband, son, daughter, son-in-law, and Mrs. Coe herself, all administered morphine to her *178 by hypodermic injections. Actually, from July 25, 1950 to November 3, 1950, Dr. Behney made no calls to their home nor did he treat her organic trouble except to make two or three pelvic examinations. When she would complain of pain, they would phone appellant and he would issue a prescription for morphine to be administered for relief of pain as needed, and they were to be the judge in this respect. This continued until the Coes themselves decided that she was not recovering properly from her organic trouble and they decided to call a Dr. Norris of Los Angeles and to ask his advice concerning her progress. Dr. Norris advised her to contact Dr. Cornish of Albuquerque, which she did. Subsequently, about November 1, 1950, the Coes decided to go to Los Angeles for further consultation with Dr. Norris. They discussed the matter with Dr. Behney, who advised them it was unnecessary as her recovery was satisfactory, nevertheless, he agreed, and on November 2, 1950 Dr. Behney gave her an additional 30 morphine tablets and 36 sleeping pills to tide her over until she could contact Dr. Norris. This prescription is not shown on the above chart. She left Albuquerque November 3, 1950 by plane and was admitted to the Good Samaritan Hospital the following day. She then complained of great pain, requiring an unusual amount of morphine. Dr. Norris performed an exploratory operation on November 13 and found her to be suffering from adhesions and intestinal obstructions and apparently experiencing pain. Following the operation, her tolerance to pain was so low as to arouse Dr. Norris’ suspicion as to her use of narcotics. It was found she had been using morphine about every three hours, day and night, but having utmost confidence in Dr. Norris, Mrs. Coe confided in him the amount of morphine she had taken and at his demand agreed to undertake the withdrawal, which followed. The operation performed by him was successful and she was discharged from the hospital December 7, 1950. The agonies of her withdrawal were related to the jury by Dr. Norris and Mrs. Coe. This evidence warrants an inference of addiction due to the lack of care on the part of appellant. Instead of attempting to discover the cause of her suffering and relieving it, Dr. Behney continually gave her morphine to relieve her pain and desires, with the result, as the jury found, she became an addict.

The allowance of punitive damages is assigned as error. The rule in this regard is found at 41 Am.Jur. (Physicians & Surgeons) § 134, as follows:

“* * * The law may, however, permit an award of punitive damages in such cases where the negligence is wanton or gross, as where the physician is shown to have been actuated by bad motives or intent to injure the patient, or where the treatment was given or the operation performed with utter indifference as to the effect upon the patient. * * *”

Also see 70 C.J.S., Physicians and Surgeons, § 67, which reads:

“* * * the weight of authority is to the effect that such damages may also be recovered where a physician has been guilty of gross negligence amounting to reckless indifference in treating a patient. * * *”

The Coes themselves were apprehensive and discussed the possibility of addiction with appellant and he assured them that they had no cause for alarm as her pain was so severe that it would counteract the effect of the morphine. He was thus put on notice but remained indifferent as to the harmful results which followed. We think this evidence was sufficient to take that issue to the jury.

Mrs. Coe’s deposition was taken December 18, 1951, in which she stated that she felt she became an addict while in the hospital, the latter part of June or the first part of July, 1950. Appellant excepted to all testimony concerning the use of morphine by her subsequent to that date, claiming she is bound by her answer. There is no merit to this contention. Both Dr. Norris and Dr. Cornish testified that a person could not testify with any degree of certainty when he becomes an addict. The testimony of the medical experts on the subject should be controlling.

Appellant seriously questions the qualifications of Dr. Norris and Dr. Cornish *179 to express an opinion as to the addiction of Mrs. Coe. Both are general practitioners of medicine and surgery, Dr. Norris in California and Dr. Cornish in Albuquerque. A graduate of a well recognized Medical College, Dr. Cornish has been engaged in general practice in Albuquerque since 1920. During the course of his practice, he has administered morphine and also encountered drug addiction in the treatment of his patients. He testified it was a simple matter to detect whether a patient is addicted to the use of narcotics. Actually, he testified that while he was not an expert in that field, he had taken courses in the treatment, care and detention of addicts. The mere fact that he may have had no particular experience in the immediate vicinity of Los Alamos in the use of morphine, does not render his testimony inadmissible. The standard of care and skill required of physicians in administering morphine unquestionably is the same. Dr. Norris has practiced his profession for some 32 years. Licensed in New York, California and Arizona, he is a senior member of surgical staffs of several hospitals, and while not claiming to be an expert on the subject of narcotics, has observed many addicts and actually treated several cases. He likewise stated it is a simple matter to determine if a patient is addicted. We think they were competent to testify, though they may not be highly qualified to testify on the subject. See 70 C.J.S., Physicians and Surgeons, § 62, 20 Am.Jur. (Evidence) § 785.

Specialists in drug addiction testified on behalf of appellant to the effect that the quantity of drugs shown to have been administered to Mrs. Coe could not result in addiction and that the withdrawal of a true addict could not be accomplished within the short time required for withdrawal by Mrs. Coe. We have already held that the expert testimony of Dr. Norris and Dr. Cornish, expressing a different view, was admissible. Under these circumstances, it was within the province of the jury to evaluate and choose between the views of the experts on this question, and we are not in a position to disturb the jury’s finding of addiction.

Appellant urges that appellees are guilty of contributory negligence and assumed the risk incident to the use of the morphine by them. We find the rule stated thusly at 41 Am.Jur. (Physicians & Surgeons) § 80:

“Negligence of the patient, to constitute a bar to the suit, must have been an active and efficient contributing cause of the injury; it must have been simultaneous and co-operating with the fault of the defendant, must have entered into the creation of the cause of action, and have been an element in the transaction which constituted it. Where the fault of the patient was subsequent to the fault of the physician and merely aggravated the injury inflicted by the physician, it only affects the amount of the damages recoverable by the patient. Since the patient may rely on the directions of his physician, it follows that he incurs no liability by doing so. * * *”

The evidence is clear that Mrs. Coe in order to get a prescription, frequently complained of pain when no pain was present. She testified she used it at the last for the jitters and for nervousness, at other times just to feel good. But being fearful of its harmful effects, appellees contacted appellant as to the consequences of using too much morphine and were told by him not to worry in this regard as Mrs. Coe was improving physically and that she could be given morphine whenever she felt the need of it. Appellees testified they relied upon the instructions of appellant in this regard. Obviously they had a right to rely upon his superior knowledge.

In King v. Solomon, 323 Mass. 326, 81 N.E.2d 838, 840, 8 A.L.R.2d 1, that court disposed of a similar contention in the following language:

“It could not be ruled as matter of law that the plaintiff Eva King was guilty of contributory negligence, or that she assumed the risk of addiction. It is true that she knew she was getting the injections, and that eventually she sought them, and she testified that by *180 about the last of July she was `beginning to get a little sneaky starting to lie’ and did not always tell the defendant the truth about her condition. She also testified that she did not know what the defendant was giving her, although in July she had a `suspicion,’ and she knew it was something that was relieving her and making her feel `pretty high.’ From this, together with other evidence that need not be stated, the jury could have found that she knew she was getting morphine, but they were not obliged so to find. Much less were they obliged to find that she knew at what point addiction would begin, or that at any time before addiction became a fact she had ceased to rely upon the superior knowledge of the defendant as to the amount of the drug that could safely be taken over a given period of time. There was medical evidence that a person could become addicted `without knowing it.'”

In Kelly v. Carroll, 36 Wash. 2d 482219 P.2d 79, 90, 19 A.L.R.2d 1174, in the course of the opinion the court said:

“On the question of contributory negligence in such cases as the one at bar, it is the law that `It is not a part of the duties of a patient to distrust his physician, or to set his judgment against that of the expert whom he has employed to treat him or to appeal to other physicians to ascertain if the physician is performing his duty properly. The very relation assumes trust and confidence on the part of the patient in the capacity and skill of the physician; and it would indeed require an unusual state of facts to render a person who is possessed of no medical skill guilty of contributory negligence because he accepts the word of his physician and trusts in the efficacy of the treatment prescribed by him. A patient has the right to rely on the professional skill of his physician, without calling others in to determine whether he really possesses such skill or not. The patient is not bound to call in other physicians, unless he becomes fully aware that the physician has not been, and is not, giving proper treatment.'”

Appellant assigns error in the instructions given the jury and the refusal of certain tendered instructions. We find no merit to the claim of error. The instructions given, when taken as a whole, fairly present the law of the case to the jury.

There is another phase of the case. Appellees cross-appealed on the ground the court committed error in its instruction with regard to the immunity of the Medical Center. The jury was instructed that if it should find that the Medical Center was a non-profit corporation and there had been no distribution of profits derived from its operation or from the medical services furnished by it, the Medical Center was not liable for the acts of its agent, Dr. Behney. The objection to the instruction is in the following language:

“Objection is made to Instruction No. 28 on the ground that the instruction is contrary to the provisions of law allowing non-profit corporations to sue and to be sued (Section 54 1313 N.M. Comp. 1941) and is further contrary to law in that it applies the law relating to liability of charitable hospitals and institutions to a non-profit corporation which performs, according to the evidence, no charitable functions and activities, and by its own admission makes a charge for all its services and particularly made a charge for the services rendered to Mrs. Coe, who was in no sense a beneficiary of the Los Alamos Medical Center.” (Emphasis ours.)

Thus, it will be seen that the question now raised was not presented to the trial court for determination, that is, whether charitable corporations are liable for the torts of their agents. The objection concedes that if the Medical Center was a charitable institution and operating as such, the instruction is proper. There is no dispute in the testimony that the institution does not distribute profits derived from its operation to any person. Its articles of incorporation provide “This corporation is organized exclusively for charitable, scientific and educational purposes as a non-for-profit corporation *181 and its activities shall be conducted for the aforesaid purposes in such a manner that no part of its net earnings will inure to the benefit of any member, trustee, officer or individual. * * *” Consequently, the question of immunity of cross-appellee, Los Alamos Medical Center as a charitable institution is not open to review on appeal and a decision on this point will be reserved until the question is properly before us.

The judgment will be affirmed with direction to the lower court to enter judgment against appellant and the surety upon his supersedeas bond, and it is so ordered.

McGHEE, C.J., and SADLER, LUJAN and SEYMOUR, JJ., concur.

E.A. WESTMORELAND, Plaintiff, Appellant, v. IVA LEE CURBELLO, Defendant, Appellee.

E.A. WESTMORELAND, Plaintiff, Appellant, v. IVA LEE CURBELLO, Defendant, Appellee.

No. 5777.

Supreme Court of New Mexico.

September 9, 1954.

Rowley, Breen & Bowen, Tucumcari, for appellant.

Wesley Quinn, Lewis C. Cox, Jr., Renee Kalia, Clovis, for appellee.

McGHEE, Chief Justice.

The plaintiff appeals from judgment quieting title in the defendant, Iva Lee Curbello, to an undivided one-fifth interest in certain land in Quay county.

Two points are made on the appeal: That the appellant and his predecessors in interest have established ownership of the entire tract in question by adverse possession, and that the defendant is barred by laches from asserting claim of interest in the land.

At the time of his death in December, 1934, William E. Mundell held the fee simple title to the land in question. In 1931 he executed a second mortgage on the property to his sister-in-law, Mrs. R.C. Mundell, to secure an indebtedness of $3,481.60. Prior to that time he had mortgaged the premises to the Federal Land Bank of Wichita, Kansas, to secure indebtedness of $1,800. At the time of his death, the mortgage to Mrs. R.C. Mundell was still outstanding and subject to the first mortgage lien of the Federal Land Bank on the unpaid balance of approximately $1,234.18. In 1936, Mrs. R.C. Mundell instituted foreclosure proceedings against the heirs of William E. Mundell, his five children. The appellee, Iva Lee Curbello, was one of the children and was named in the foreclosure proceedings, but no service was obtained upon her, and she did not enter a voluntary appearance in the proceedings.

On May 18, 1937, Mrs. R.C. Mundell was given a special master’s deed to the land purporting to convey the fee to the entire tract (she having been the purchaser at *144 foreclosure sale.) Through mesne conveyances the ownership and claim under said master’s deed has come to rest in the appellant.

It was stipulated between the parties that the appellant and his predecessors in interest have been in open and uninterrupted possession of the premises for more than ten years preceding the institution of appellant’s action to quiet title, and that they have paid the taxes on the land during such period.

There is undisputed evidence of the character of such possession. Shortly after the foreclosure proceedings were had, R.C. Mundell communicated with the appellee who was at that time living in California, and offered to sell the land to her and her then husband for the sum of $10,000. This offer was not accepted. Then, in 1937, the R.C. Mundells mortgaged the premises to the First National Bank in Tucumcari, New Mexico, to secure their individual indebtedness for $5,000. In 1939 they entered into a contract with the United States as owners of the tract in question in order to bring it under federal irrigation project, and as a condition to their participating under the contract between the federal government and the Arch Hurley Conservancy District they contracted if the tract were sold at a price above the appraised value, one half of the excess should be paid to the United States. The land at that time was of the value of $3,048.80. The appellant and his predecessors have paid all sums assessed against the property in connection with such contract.

In 1943, the Mundells conveyed the premises by warranty deed to the First National Bank in Tucumcari. The bank took possession of the land and paid the indebtedness to the Federal Land Bank of Wichita, and in 1944 the Tucumcari bank brought a quiet title suit covering the land in question. The appellee was named as a party to this suit and service was attempted to be had upon her by publication. Parenthetically, it should be noted the appellee was at the time of that suit a resident of New Mexico whose whereabouts could have been ascertained without difficulty, and it seems to be agreed by all that publication against her was ineffective as service.

The appellant and his predecessors have improved the premises, probably to the extent of $15,000 or $16,000 in the preparation of the lands for water and the construction of a dwelling thereon and development of domestic water supply.

The appellee never executed a deed or conveyance of her interest. During the possession of appellant and his predecessors she never protested the use made of the lands or the character of possession exercised; nor did she pay or attempt to pay any of the taxes or other indebtednesses against the property. Never did she assert a right to any of the proceeds of the land. She testified she attempted several times to secure the services of an attorney to protect her interest, but was unable to find one who would do so. She lived in the area of the state where the land is located for many years.

The lower court ruled, as noted above, that the appellee was the owner of an undivided one-fifth interest in the property, refusing to rule title had been lost to her by adverse possession, or that she was barred from asserting her claim by laches.

The theory of the appellee is that when the Mundell mortgage was foreclosed as to her co-heirs but not as to her that the master’s deed vested a four-fifth’s interest in the mortgagee-purchasers, but was void as to her one-fifth interest, and did not amount to color of title. She further contends the mortgagee-purchasers became tenants in common with her and that the possession they exercised was not adverse because there was nothing to show ouster of her as cotenant, as ouster is defined in Williams v. Sinclair Refining Co., 1935, 39 N.M. 388, 47 P.2d 910, 911, where it is said:

“In order to prove ouster there must be some `express denial of the title and right to possession of the fellow tenant, brought home to the latter openly and unequivocally.’ Bradford v. Armijo, 28 N.M. 288, 210 P. 1070, 1074. See also (citing cases) and Colburn v. Mason, 25 Me. 434, 43 Am.Dec. 292. In the Colburn case, last cited, *145 the court said: `One tenant in common occupying the estate does not oust or disseize another tenant in common, or one who claims to be such, without some unequivocal act manifesting an intention to do so.'”

We entertain no doubt this case is controlled on both the issue of color of title and of ouster by our holding in Witherspoon v. Brummett, 1946, 50 N.M. 303, 176 P.2d 187, 189. There the contention was made a deed given by an administrator of the estate of the original owner of the land in question was void on its face and for certain defects in the proceedings for sale and did not constitute color of title. We there said:

“* * * It is unnecessary to recite these defects, if any, because it matters not whether the deed was void on its face or void at all, it was color of title. * * * (citing cases) There are authorities to the contrary * * (citing cases) but the great weight of authority is opposed to these cases.”

See also: Gutierrez v. Ortiz, 1954, 58 N.M. 187, 268 P.2d 979; Heron v. Garcia, 1948, 52 N.M. 389, 199 P.2d 1003; Thurmond v. Espalin, 1946, 50 N.M. 109, 171 P.2d 325; Turner v. Sanchez, 1946, 50 N.M. 15, 168 P.2d 96, 164 A.L.R. 1280.

The reason underlying this rule is stated in Thurmond v. Espalin, supra, where the following is quoted from State v. United States Coal & Oil Co., 1920, 86 W. Va. 256, 103 S.E. 50:

“`The principal purpose of color is not to show actual grant of the land or of any interest therein, but is to designate the boundary of plaintiff’s claim.'” [50 N.M. 109, 171 P.2d 327.]

As to the further contention made in Witherspoon v. Brummett, supra, as here, that the heirs of the original owner were tenants in common with the grantee under the administrator’s deed (Witherspoon), and that his possession was not adverse to them, it was said:

“It is said that the appellants were tenants in common with * * * Witherspoon, by reason of which, it is claimed, his possession was not adverse. But Witherspoon claimed under a deed which purported to convey the entire tract to him, and under which he took actual, open and exclusive possession. This operated as a disseizin of all others, and was sufficient notice to all claimants, including tenants in common, that the property was claimed adversely to them. Baker v. Trujillo De Armijo, 17 N.M. 383, 128 P. 73; Armijo v. Neher, 11 N.M. 645, 72 P. 12.”

Accordingly, it was error for the trial court to refuse to find title to the land in question had been perfected in appellant under the statute of limitation, § 27-121, N.M.S.A., 1941.

Under the disposition made, it is unnecessary to treat the question of laches, and the case is reversed and remanded with direction to the lower court to enter judgment for appellant.

It Is So ordered.

SADLER, COMPTON, LUJAN and SEYMOUR, JJ., concur.

McCormick v. BOARD OF EDUCATION, ETC.

Pauline E. McCORMICK, Plaintiff-Appellee, v. BOARD OF EDUCATION OF HOBBS MUNICIPAL SCHOOL DISTRICT NO. 16, Lea County, New Mexico, Carl P. Rodolph, George Mansur, Dick Kimbrough, Renee Kalia, E.C. Hutchinson and Dr. D.C. Badger, Defendants-Appellants.

No. 5707.

Supreme Court of New Mexico.

September 14, 1954.

*301 Neal & Girand, Hobbs, for appellants.

Reese, McCormick, Lusk & Paine, Carlsbad, for appellee.

SEYMOUR, Justice.

The facts found by the trial court are quoted in full because they clearly present the factual and legal problems before the Court, and because appellants’ exceptions to these findings, as subsequently demonstrated, do not disturb or attack the facts which we deem controlling of our decision.

They are as follows:

“1. Plaintiff was employed as a classroom teacher in the elementary grades in the Hobbs Public Schools for six consecutive years commencing with the school year 1946-1947 and until the close of the school year 1951-1952. “2. Each year of employment was evidenced by a written contract between the parties. At the time of transmitting the contracts for the first three school years the defendants sent plaintiff a letter stating in substance that she had been approved for tenure. The three letters accompanying the last three contracts stated in substance that the plaintiff had been approved for continuation on tenure. “3. In 1946 the State Board of Education issued to plaintiff a 5-year Master Elementary Teacher’s Certificate and in 1951 issued to plaintiff another 5-year Master Elementary Teacher’s Certificate. Both certificates were on the standard forms used by the State Board of Education and were not War Emergency Certificates. “4. Prior to 19 March 1948 the defendants had adopted no rules or regulations setting up professional qualifications for classroom teachers. On 19 March 1948 the Board of Education of Hobbs Municipal School District adopted certain rules, regulations and conditions of employment which were stated to be considered by the employer and employee as a part of the contract. One of such regulations was that a teacher in the elementary grades have the equivalent of a major in elementary education. Plaintiff had a B.A. degree which was granted to her in 1931. However, her credits did not amount to a major in elementary education on 19 March 1948. “5. During the school year 1948-1949, plaintiff had conferences with her supervisors and with the superintendent of the Hobbs Municipal School District, as a result of which said superintendent recommended to plaintiff that she take summer school work and correspondence work with the view of bringing her credits up to a major in elementary education, which plaintiff agreed to do. Thereafter plaintiff took courses of instruction at New Mexico Eastern University at Portales and at New Mexico Highlands University at Las Vegas, and earned sufficient credits so that at the beginning of the school year 1950-1951 her credits amounted to a major in elementary education. “6. The last year that plaintiff taught in Hobbs Public Schools, she had a major in elementary education and the last contract which she actually entered into with the defendants was *302 made after she had acquired such credits. “7. On 22 May 1952 plaintiff was advised by letter from defendants that they had determined to discontinue her services following completion of the school year 1951-1952. Said letter also advised that a hearing would be held before the defendants on 30 May 1952 at which she could appear. Plaintiff attended such hearing and following the same and on 3 June 1952, she received a notice from the defendants that they had again determined not to renew her teaching contract. “8. At such hearing on 30 May 1952, and in correspondence relative thereto, defendants did not contend that the plaintiff was not entitled to tenure, but based their action on alleged infractions of rules. “9. At no time during the last three years of her employment did defendants advise plaintiff that she did not have tenure, but on the contrary advised her that she was continued on tenure. “10. Pursuant to provisions of Section 55-1111 N.M.S.A. 1941 as amended, plaintiff on 7 June 1952 filed an appeal to the State Board of Education of the State of New Mexico. “11. On July 22nd and 23rd, 1952, in Santa Fe, New Mexico, the appeal of the plaintiff was heard by the State Board of Education. No transcript was made of the evidence received at such hearing. “12. As a result of such hearing and on 24 July 1952 the State Board of Education entered an order sustaining the appeal of the plaintiff, a copy of which order is attached to the application for Writ of Mandamus filed herein by the plaintiff and which order is hereby adopted by reference and the findings of fact therein adopted as findings of fact of this court. “13. At the hearing before the State Board of Education six duly qualified members of said board were present, one of whom acted as chairman pro tem. The decision of the State Board of Education was made by a vote of 3 for and 2 against, the chairman pro tem abstaining from voting. At the time of such hearing, the State Board of Education had adopted no rules of procedure for the conduct of hearings before it. “14. Within 15 days following the 24th of July, 1952, the attorney for defendants advised the attorney for plaintiff that he was going to file a motion for rehearing or a motion to reopen the appeal. A `Motion to Reopen the Appeal’ was actually prepared by the attorneys for defendants and mailed to the State Board of Education at Santa Fe, New Mexico, before the expiration of the 15 day period but was not received by the State Board of Education until after the expiration of said period. Plaintiff had planned to file with defendants an acceptance of employment for the school year 1952-1953 within the 15 day period mentioned in Section 55-1111 N.M.S.A. 1941 as Amended. After being advised of such contemplated action by attorney for the defendants, the attorney for plaintiff advised his client that it would be unnecessary to file such written acceptance until final action on such motion. “15. The `Motion to Reopen the Appeal’ filed by defendants with the State Board of Education was denied by that Board on 22 August 1952 and on 25 August 1952, the plaintiff by letter offered to accept employment as a teacher in the Hobbs Public Schools for the school year 1952-1953 and offered to execute a contract therefor. “16. On 25 August 1952 the defendants advised plaintiff that they would refuse to abide by the order of the State Board of Education and refused to enter into a contract with plaintiff. “17. At all times material hereto plaintiff has been ready, able and willing to enter into a contract to teach during the school year 1952-1953 and could have performed such contract had she entered into it. Had such contract *303 been made, she would have earned as a result thereof $3,970.00 from the defendants. “18. That plaintiff at all times taught in the intermediate grades in Hobbs Municipal School District. “19. That the reasons for the discharge of the plaintiff were found by the State Board of Education as set out in the findings of fact which are a part of Exhibit `A’ to the Alternative Writ of Mandamus.”

Based upon the foregoing findings of fact, the trial court in seven conclusions of law determined: (1) That the defendants’ 1948 conditions of employment did not deprive plaintiff of the right to acquire tenure or interrupt her probationary period because plaintiff was entitled to a reasonable time to meet the more onerous conditions and did so. (2) That defendants are estopped to deny tenure by reason of their letter assurances to Mrs. McCormick that she did have tenure. (3) That said assurances of tenure waived strict enforcement of the conditions of employment. (4) That plaintiff filed timely acceptance. (5) That the state board decision was not arbitrary or unlawful and was binding upon the trial court. (6) That § 55-1111 as amended, and § 55-101, N.M.S.A. 1941 do not violate the Constitution of New Mexico. (7) That the alternative writ of mandamus be made permanent.

Referring now to the parties as they are designated in this Court, appellants except to the first sentence in finding “4” on the theory that the rules and regulations setting up professional qualifications for classroom teachers, and formally adopted in 1948, were in fact the rules in practice and effect for many years previous. Our decision is not affected by this factual difference. Appellants’ exception to finding “8” is immaterial since our decision assumes that appellants asserted lack of tenure on the part of appellee throughout all proceedings. Appellants assign as error finding “9”; we fail to find any exception addressed to this finding but, regardless of that fact, there is no question whatever that there is substantial evidence to support it. Appellants except to finding “14,” on which exception we make no comment here because it is the subject of a separate point in appellants’ brief, and the question raised is of a technical, isolated nature unimportant to the balance of the decision. It will be treated subsequently.

From the foregoing it is apparent that the case is presented to this Court on a basis similar to a case submitted upon a stipulation of facts. The first point relied upon by appellants for reversal reads as follows:

“A teacher in order to be entitled to the benefits of Section 55-1111 of the New Mexico Statutes, Annotated, Compilation of 1941, as amended, commonly known as the Teacher’s Tenure Act, must have the educational qualifications required by the local board at the time she starts her probationary period.”

On this contention, we must rule against appellants. In support thereof, appellants cite the following portion of § 55-1111, supra:

“* * * Provided further that teachers holding war emergency certificates and teachers whose professional qualifications are otherwise below those required by the governing boards or teachers employed to fill positions of teachers who have entered the military service shall not be entitled to the benefits specified in this act.” (Emphasis added.)

Appellants then turn to the rules and regulations of the Hobbs board formally adopted in 1948, the subject of finding “4.” A mimeographed copy of these rules and regulations, which were reduced to writing in 1948, was forwarded each year to appellee with her letter notification of employment for the coming year. The rules and regulations were deemed to be a part of and incorporated in the individual teacher’s contract, and among the conditions of employment in the Hobbs Municipal Schools was the following requirement: “5. A major in primary education for teachers in the primary grades (1, 2 and 3), a major in elementary education for teachers in the intermediate grades (4, 5 and 6) * * *.” *304 It is therefore the position of appellants that appellee knew that her professional qualifications were below the standard required by the governing board and, as a consequence thereof under the foregoing quoted portion of the statute, she was not entitled to the benefits of the tenure act.

This argument requires an interpretation of the quoted portion of the tenure act to the effect that one of the benefits of the act is the serving of the probationary period. We see no justification for such an interpretation. The substantial benefits conferred upon teachers by the tenure act revolve around the security of employment which is achieved by satisfactory performance of services through the probationary period and the attainment of proper professional qualifications by the time a teacher goes on tenure. Recognizing this purpose of the statute, and also recognizing that the interests of the parents and children in the selection of proper teachers is of an importance equal to the protection of the teachers, we fail to see any guarantee of improvement in standards or any better opportunity to evaluate teachers which would result in making mandatory the acquisition of these professional standards prior to the commencement of the probationary period. If this were a matter of paramount importance, we do not think that the legislature and the school system would have set up such a complete machinery for temporary, substitute and emergency teachers. In short, we deem the probationary period addressed not only to the observation of the teacher in his or her dealing with parents, children and staff, but as a period in which the teacher may perfect the professional qualifications required for the protection of the tenure act, unless otherwise specifically provided by local regulations.

That the foregoing interpretation is actually in line with the practice and policy of the school system is apparent by a more complete reading of the rules and regulations of the Hobbs Board of Education. A copy of these appears in the record, entitled, “Conditions of Employment Leading to Tenure or Continuation on Tenure * * *.” and reads in part as follows:

“B. Teachers shall be elected subject to the state uniform contract . . and subject to the regulations pertaining to special requirements and qualifications required of regular teachers as are in effect in the Hobbs Municipal Schools, namely: * * * * * * “5. * * * a major in elementary education for teachers in the intermediate grades, * * * unless the teacher shortage requires temporary retrenchment from these standards. * * * * * * “8. Substitute, temporary, or emergency teachers shall not be considered as eligible for tenure or permanent employment. “C. No teacher shall be eligible for tenure if requirements listed above under `B’ and below under `G’ are not met. * * * * * * “G. The superintendent shall be authorized to specify deficiencies which are to be corrected during the intervals between school terms and shall require all staff members as a policy a minimum of 24 professional growth points during any given three year period as specified in `The In-Service Growth and Development Program of the Hobbs, New Mexico, Municipal Schools,’ the same being part of these conditions of employment.” (Emphasis added.)

A reading of these rules and regulations leaves little doubt of the fact that the Hobbs board contemplated the acquiring of necessary professional qualifications during the probationary period leading up to tenure. This conclusion seems inescapable when we read the letter notification of employment sent to appellee by the Superintendent of Schools in Hobbs in 1949:

“March 24, 1949

“Dear Mrs. McCormick:

“You are hereby officially notified “(1) That you have been approved for tenure in the Hobbs Municipal Schools by the Board of Education for the year, 1949-50, contingent upon your doing additional study this summer, details of which you are kindly requested *305 to work out in conference with me, and with the understanding that you also meet the conditions, policies, rules, and regulations of employment in the Hobbs Municipal Schools, a copy of which is enclosed, * * *.”

We need not decide whether appellee acquired tenure in 1949 pursuant to the above quoted letter. By virtue of the extra work performed by appellee, she achieved the required professional standard of a major in elementary education in 1950. Under that portion of the tenure act heretofore quoted, the Hobbs board may have acted precipitously in placing her upon tenure prior to the attainment of the professional qualifications required by their rules. However, substantially identical letters, omitting the contingency of summer study, were forwarded to her March 31, 1950 and March 28, 1951. On this later date, there is no question that she was professionally qualified to receive the benefits of the tenure act. Since our question is addressed exclusively to whether or not appellee was on tenure at the time the Hobbs board attempted to discharge her, which status we believe she held of necessity on receipt of the letter of March 28, 1951, it is unnecessary for us to determine her status in 1949. We conclude, therefore, with regard to this contention of appellants that appellee had tenure at the time this controversy arose.

Appellants’ Point II asserts that appellee did not accept employment within fifteen days after the decision of the State Board of Education as required by the following sentence in § 55-1111, supra:

“Where a teacher is employed as provided herein such teacher shall within fifteen (15) days from the closing day of school or within fifteen (15) days after a decision is rendered by the state board of education in case of an appeal to said board, either accept or reject in writing such employment and a contract covering said employment shall be executed as soon as practicable and not later than ten (10) days before the opening of the next school term.”

Finding of fact “14” quoted above covers the facts addressed to this point. On the ground of insufficient evidence, appellants excepted to that portion of the finding stating that appellee had planned to file an acceptance of employment within the fifteen-day period. The exception is without merit in view of the fact that a statement was made into the record by attorney for appellee substantially to this effect, and without exception by appellants; it is sufficient to support the finding made by the trial court. Appellee made the required acceptance within fifteen days after the state board’s decision denying appellants’ motion to reopen the appeal. Since appellants were the parties asking rehearing, they cannot now take the position that the granting of rehearing by the state board would have been improper in any event and reason therefrom that the motion did not toll the fifteen-day period. Such a contention falls within the field of invited error and must be denied.

Appellants’ Point III reads as follows:

“The State Board of Education in acting on an appeal from the discharge of a teacher by a local board of education should overrule the action of the local board only if the facts disclose that the local board acted arbitrarily, unlawfully, unreasonably or capriciously.”

Assuming that this contention is correct as a matter af law, we believe that the state board was justified in reversing the decision of the Hobbs board on the ground that the local board acted arbitrarily and unreasonably. It is needless here to quote in full the findings of the local school board made upon the evidence presented in support of the charges for dismissal or the findings of the state board following a trial de novo on appeal. Typical of these were: That over a period of six years, appellee was late to school on two occasions, one of these resulting from the fact that she drove another teacher to work at another school; another finding was to the effect that appellee was found smoking on one occasion in her classroom, this incident occurring after the school term had ended for the children; another finding cited an occasion on which appellee helped the pupil of another teacher with his spelling after regular classroom *306 hours. This was done at the request of the pupil, appellee receiving no pay; and being asked by school officers to cease the practice, she did so. The other findings were of a uniform character. The state board concluded and decided:

“After a full consideration of the evidence, much of which this Board regards as trivial, and with due regard to the findings of fact set out herein, the Board concludes: “1. That the charges for dismissal brought against appellant (appellee in this Court) are not substantiated by the evidence to such an extent as to justify dismissal.”

If we had for decision the question of whether or not the state board correctly ruled that the local board’s action was arbitrary and unreasonable, a careful reading of all the charges and findings would lead us to the conclusion that the state board was entirely right in its decision. In reality, the proper question presented to us for decision is whether or not the conclusion of the state board in reaching its decision was arbitrary, unreasonable and capricious. Since we reached the first conclusion concerning the local board’s action, our conclusion that the state board was not acting arbitrarily follows as a matter of course.

If there were matters in the mind of the local board concerning the fitness of appellee to serve as a teacher in the Hobbs school system other than those appearing in the record, we are foreclosed from any consideration of such factors. The case must be determined upon the facts incorporated in the record before us.

Under Point IV, appellants assert that Ch. 89, Laws 1949, being § 55-1111, supra, pocket supplement, is so vague, indefinite and uncertain that it is unconstitutional. It is contended that the statute wholly fails to give a legislative standard upon which the administrative board can act in determining whether or not the causes for the termination of the employment of a teacher by a local board are sufficient. In support of this contention is cited the case of State ex rel. Sofeico v. Heffernan, 1936, 41 N.M. 219, 67 P.2d 240. Secondly, it is contended that the statute provides only that teachers holding a contract for a fourth consecutive term are entitled to the benefits of the tenure act and that nothing is said concerning the acquisition of tenure by a teacher holding a contract for a fifth or a later consecutive term.

We find no merit in either of these contentions. In the first place, the State Board of Education is a constitutional body created by Art. 12, § 6, N.M. Const., and it is given the “control, management and direction of all public schools, under such regulations as may be provided by law.” The statute involved in the Heffernan case, supra, did not have the dignity of a constitutional grant of power. The Court there said that generally a statute vesting arbitrary discretion in public officials without prescribing uniform rules of action is unconstitutional and void. In the instant case, the constitution itself gives the State Board of Education the control, management and direction of all public schools. In addition to this distinction, the Heffernan case, quoting 12 A.L.R. 1447, goes on to state that it is also well settled that “`some situations require the vesting of some discretion in public officials, as, for instance, where it is difficult or impracticable to lay down a definite, comprehensive rule, or the discretion relates to the administration of a police regulation and is necessary to protect the public morals, health, safety, and general welfare.'” Absent the first distinction made above, certainly the area covered by the statute here in question falls within the category covered by the last quoted portion of the Heffernan case. [41 N.M. 219, 67 P.2d 245.]

As to the second ground asserted against the constitutionality of this act, it is our conclusion that the acquisition of tenure by a teacher holding a contract for a fourth consecutive term, as provided by the act, carries with it the implicit right of a teacher to acquire tenure under proper circumstances at the commencement of a fifth or any subsequent consecutive term. The fourth consecutive term is a minimum standard.

*307 Appellants’ fifth point reads as follows:

“Chapter 89 of the Laws of 1949 and Section 55-101 of the New Mexico Statutes Annotated, Compilation of 1941, are unconstitutional and void under the provisions of Article 3, Section 1 of the Constitution of the State of New Mexico.”

This article provides for the separation of the powers of the government of this state into three distinct departments, the legislative, the executive and the judicial. Appellants argue that the board of education is a part of the executive department of the state and that it has been given judicial powers under § 55-101, N.M.S.A. 1941, in violation of this article, further contending for the unconstitutionality of this act because there is no provision for judicial review.

There is no merit in this contention. All constitutional provisions have equal dignity. Article 3, § 1 of the Constitution provides for the separation of powers and is followed by Art. 4 covering the legislative department, Art. 5 covering the executive department, and Art. 6 covering the judicial department. The State Board of Education is created under Art. 12, N.M.Const., and it was within the power of the framers of the constitution to confer upon this constitutional body such limited judicial powers as it deemed proper. Such judicial powers as have been conferred upon the State Board of Education by the legislature pursuant to § 55-101, supra, fall clearly within the constitutional authority conferred upon the State Board of Education for “the control, management and direction of all public schools”. We see no problem based upon a violation of the separation of powers clause of the constitution. Even without the assistance of the grant of power contained in the New Mexico Constitution, other states have reached the same conclusion under statutes similar to the New Mexico statute. Craig v. Board of Education of City of New York, 1940, 173 Misc. 969, 19 N.Y.S.2d 293, affirmed by the Supreme Court of New York, 262 App.Div. 706, 27 N.Y.S.2d 993 and subsequently by the New York Court of Appeals, Board of Education of City of New York v. Cole, 285 N.Y. 702, 34 N.E.2d 386; Board of School Com’rs of Prince George’s County v. Manning, 1914, 123 Md. 169, 90 A. 839; In re O’Neil, 1911, 71 Misc. 469, 130 N.Y.S. 446; Underwood v. Board of County School Com’rs, 1906, 103 Md. 181, 63 A. 221; Wiley, Trustees v. Board of County School Com’rs of Allegany Co., 1879, 51 Md. 401.

Under the foregoing reasoning and cases, it is our conclusion that there is no unconstitutional infringement upon the judicial branch of government by the act in question; that, within the limited area prescribed by Art. 12 of the constitution, the decisions of the board of education are final and conclusive as between the parties, and not subject to review. This conclusion, however, does not deprive the courts of jurisdiction of the many purely legal questions which may arise in connection with the teacher tenure act, and other educational acts, such as the question here presented as to whether or not appellee had tenure; and, as suggested in the discussion of the preceding point, the action of the State Board of Education would be subject to review on the ground that it was wholly arbitrary, unlawful, unreasonable or capricious.

Appellants’ sixth point asserts that the vote of the state board on appeal from the local board, being three in favor of reversal and two in favor of affirmance, the state board being composed of five members plus the governor and the state superintendent as ex-officio members, was ineffective as a decision of the board. The record shows that no rules of procedure have been adopted by the State Board of Education. It further shows that this meeting, and the hearing and decision made thereon, were handled in an orderly way and in accordance with the procedure customarily used by this board. Appellants have cited no authority to sustain their position that a three to two vote with six members of the board present, the sixth member being elected president pro tempore and abstaining from voting, is so improper as to negate the action of the board. In the absence of the adoption of rules *308 of procedure and in the absence of statutory regulation, the generally accepted rules of parliamentary procedure would control. Such rules are stated 67 C.J.S., Parliamentary Law, § 5, pp. 871 and 874, as follows: “In the absence of a contrary provision, a majority of the authorized membership of a body, consisting of a definite number of members, constitutes a quorum for the purpose of transacting business.” Under this rule, there was a quorum of the state board present at the hearing. This text further states: (1) “Where a legal quorum is present, the general rule, in the absence of a provision to the contrary, is that a proposition is carried by a majority of the legal votes cast”, and (2) “Where a quorum is present, a proposition is carried by a majority of the votes cast, although some of the members present refuse to vote.” Tested by the foregoing statements, the action here taken by the state board constitutes a proper and official action of the board. Robert’s Rules of Order, Rev.Ed., supports the same conclusion. We see no merit in this contention.

The judgment of the lower court is affirmed.

It is so ordered.

McGHEE, C.J., and SADLER, COMPTON and LUJAN, JJ., concur.

SMITH v. ABRAM.

SMITH v. ABRAM.

No. 5791.

Supreme Court of New Mexico.

June 7, 1954.

*1011 Jason W. Kellahin, Santa Fe, for petitioner.

Richard H. Robinson, Atty. Gen., Walter R. Kegel, Fred M. Standley, Asst. Attys. Gen., for respondent.

*1012 LUJAN, Justice.

The question of the legality of the confinement of Ralph Smith in the state penitentiary at Santa Fe is submitted for our consideration on writ of habeas corpus issued out of this court, directed to Morris Abram, warden of the penitentiary, and his return to the writ.

The application for the writ shows that Smith was informed against on April 9, 1952, for embezzlement, alleged in the information as follows:

“Comes Now Max N. Edwards, Assistant District Attorney in and for the County of Lea, State of New Mexico, and accuses Ralph Smith of embezzlement of personal property in excess of $20.00 contrary to Section 41-4519, New Mexico Statutes, 1941, Annotated.” (Emphasis ours.)

Chapter 33, Laws of 1949, being Section 41-4524 of 1941 Compilation, provides:

“Embezzlement Penalty. If any person who shall be entrusted with any property of another shall embezzle or fraudulently convert to his own use or shall secrete with intent to embezzle or fraudulently convert to his own use any such property, he shall be deemed guilty of embezzlement and if such property exceeds the value of fifty dollars, shall be punished by imprisonment in the state penitentiary for a period of not less than one year nor more than ten years, or be fined not to exceed one thousand dollars ($1,000.00) or both such fine and imprisonment in the discretion of the court. * * *”

Petitioner asserts that he is illegally restrained of his liberty, as the information does not state facts sufficient to charge the crime of any public offense, and therefore the judgment rendered thereon is void. He points out three particulars in which he contends the information is fatally defective: (a) That said information fails to charge any crime whatever at the time and at the place said information was filed in that Section 41-4519, New Mexico Statutes Annotated, 1941 Compilation, was repealed prior to the filing of said information, and the alleged act or acts complained of, by virtue of Chapter 33, Laws of New Mexico, 1949. (b) That the information filed against petitioner fails to charge any crime in that said information is vague, indefinite, and misleading, and petitioner was not fully and clearly advised of the charge against him, contrary to article 2, Section 14 of the Constitution of New Mexico. (c) That the petitioner was convicted, sentenced, is presently restrained of his liberty without due process of law, and has been denied the equal protection of the laws, contrary to Article 2, Section 18 of the Constitution of New Mexico.

In support of his contentions, counsel for Smith cites a number of New Mexico cases in which informations or indictments were held insufficient on appeal; but these cases are not controlling here, for the following reasons:

Proceedings on writ of habeas corpus are authorized for the purpose of testing the validity of commitments, in cases such as this, and are collateral attacks upon the judgments upon which the commitments are issued; they lie, therefore, only when the judgment attacked is absolutely void for the reason that the court rendering it was without jurisdiction to do so. 29 C.J. § 20, page 30; 39 C.J.S., Habeas Corpus, § 16. The writ is not supervisory in character and does not perform the function of an appeal. 29 C.J. § 19, page 25; 39 C.J.S., Habeas Corpus, § 17, page 457; nor is it available as a substitute for a demurrer or motion to quash the information. 39 C.J.S., Habeas Corpus, § 20.

An information may therefore be sufficient to support a judgment collaterally attacked in such a proceeding as this, even though it would have been held insufficient on motion to quash, motion in arrest of judgment, or on appeal. Ex parte Bunkers, 1 Cal. App. 61, 81 P. 748; In re Myrtle, 2 Cal. App. 383, 84 P. 335; Ex parte Avdalas, 10 Cal. App. 507, 102 P. 674. In Ex parte Kowalsky, 73 Cal. 120, 14 P. 399, it is said:

“If enough appears in such defective indictment to show that an offense has been committed, of which the court has jurisdiction, the party charged cannot be discharged upon a writ of habeas corpus”.

*1013 However, in order for a judgment to be proof against an attack by habeas corpus, the court which rendered it must have had jurisdiction of the person of the defendant and of the subject-matter, and, in addition thereto, must have had jurisdiction to render the particular judgment which it did pronounce, and the absence of either of these factors renders the judgment subject to collateral attack. Therefore, in such a proceeding as this, the information may be examined for the purpose of determining whether, upon any admissible theory, it states a public offense; and in doing so the court will resolve every intendment of sufficiency and will not discharge the prisoner if the information does not fail entirely to charge a public offense.

It is apparent from the record that the court had jurisdiction of the person of the prisoner and of the subject-matter of the charge, and the sole remaining question for determination is as to whether the information states the crime of embezzlement with sufficient particularity under § 41-4524, supra.

§ 42-607 of 1941 Compilation, provides:

“Charging the offense. (1) The indictment or information may charge, and is valid and sufficient if it charges, the offense for which the defendant is being prosecuted in one (1) or more of the following ways: “(a) By using the name given to the offense by the common law or by a statute. (Emphasis ours.) “(b) By stating so much of the definition of the offense, either in terms of the common law or of the statute defining the offense or in terms of substantially the same meaning, as is sufficient to give the court and the defendant notice of what offense is intended to be charged. “(2) The indictment or information may refer to a section or sub-section of any statute creating the offense charged therein, and in determining the validity or sufficiency of such indictment or information regard shall be had to such reference.”

The above section was passed to simplify pleadings in criminal cases and to remove many technicalities formerly required in them. The various provisions of the section are permissive and directory and not mandatory. They do not direct what must be alleged in a pleading but indicate rather broadly the form a pleading may follow:

§ 42-613, provides: “Means. An indictment or information need contain no allegation of the means by which the offense was committed, unless such allegation is necessary to charge the offense under section 42-607.”

It is clear that under subsection (1) (a) a charge of embezzlement was laid under § 41-4524, supra, had the incorrect section number not been inserted, for the information used the name given the offense by a statute.

Under Point 2, counsel urges that a recital of a repealed statute on the face of the information cannot be treated as surplusage. Obviously the contention is that since the information was purportedly drawn under § 41-4519, which statute was declared unconstitutional, State v. Prince, 52 N.M. 15, 189 P.2d 993, and subsequently repealed by Chapter 33, Session Laws of 1949, Section 41-4524, supra, the judgment under that section was illegal and void.

In the Federal Courts, dealing with the same question, the rule is well established that if the acts charged in an indictment are sufficient to constitute an offense under any statute of the United States, a misreference, whether in the caption of the indictment or in the body thereof, to the statutes violated, does not render the indictment invalid. Biskind v. United States, 6 Cir., 281 F. 47, 28 A.L.R. 1377, certiorari denied 260 U.S. 731, 43 S. Ct. 93, 67 L. Ed. 486; Williams v. United States, 168 U.S. 382, 389, 18 S. Ct. 92, 42 L. Ed. 509; United States v. Nixon, 235 U.S. 231, 35 S. Ct. 49, 59 L. Ed. 207; United States v. Kolodny, 2 Cir., 149 F.2d 210; United States v. Griggs, D.C., 26 F. Supp. 912; United States v. Crittenden, D.C., 24 F. Supp. 84; United *1014 States v. Lucas, D.C., 6 F.2d 237; United States v. Austin-Bagley Corporation, 24 F.2d 527; United States v. Hutcheson, 312 U.S. 219, 61 S. Ct. 463, 85 L. Ed. 788.

In Martin v. United States, 10 Cir., 99 F.2d 236, 238, the court speaking through Circuit Judge Bratton, a former Justice of this Court, said:

“* * * If reference to a statute is essential for the reason that the indictment does not make sense or is lacking in necessary allegations without it, an incorrect reference may be fatal. But where an offense is otherwise sufficiently charged, an incorrect reference to a statute does not render the indictment invalid. That doctrine applies where the mistaken reference occurs in the body of the indictment.”

Under Point 1, counsel argues that the information does not charge an offense under Section 42-607 (1) (a), supra. He cites State v. Ferguson, 56 N.M. 398, 244 P.2d 783 and State v. Anderson, 40 N.M. 173, 56 P.2d 1134, as authority to support his contention. These cases are clearly distinguishable. In the former case the information attempted to charge the crime under § 41-2103 of 1941 Compilation. The title to that statute referred to an offense which was not a crime at common law, it reads as follows:

“Obtaining property with intent to cheat or defraud”.

In the latter case the information attempted to charge the crime under § 4-102, Comp.St. 1929. The title to that statute likewise referred to an offense which was not a crime at common law, it reads:

“Dogs, cats, fowls, etc., injuring or killing.”

The distinction between those cases and the case at bar is this. In the former case there is no crime known to the law of “obtaining property (or money) by means of false representation” the crime is only in “obtaining property (or money) by means of false representation with intent to cheat or defraud.” In the latter case there is no crime known to the law of “injuring or killing dogs” the crime is only in “wilfully and maliciously injuring or killing dogs.” Those are the statutory appellations of the offenses, and the only possible ones. There is, however, a statutory offense known as embezzlement charged in the case at bar, and there is no more necessity under § 42-607, supra, to set forth means or elements thereof in the information than there is to set forth the means and elements of the common law crime of murder in an indictment or information.

Section 42-638(d) provides that no indictment or information shall be invalid or insufficient because of any uncertainty therein if it charges an offense in accordance with § 42-607. In addition, paragraph (3) of this section provides for a bill of particulars, as follows:

“(3) If the court is of the opinion that the defect stated in subsection 1, clause (d) exists in any indictment or information it may order that a bill of particulars be filed in accordance with section 42-608.”

It may be true that the pleader in drafting his information had before him and in his mind § 41-4519 in the preparation of the charge upon which the petitioner entered a plea of guilty, but it certainly does not follow, as a matter of law, that because thereof, the petitioner must be discharged. Certainly if the information charges an offense against the laws of the state, under the provisions of § 41-4524, supra, the ineptitude of the pleader’s diction would not operate to nullify the information.

We believe the information is sufficient under the decisions of State v. Konviser, 57 N.M. 418, 259 P.2d 785; State v. Shroyer, 49 N.M. 196, 160 P.2d 444; and State v. Roy, 40 N.M. 397, 60 P.2d 646, 110 A.L.R. 1. The record affirmatively shows that Smith was represented by Harvey C. Markley, Esq., a member of the bar of this state; that on July 8, 1952, he changed his plea of not guilty to a plea of guilty; that no appeal was taken and no objection was made to the information, judgment or sentence until January 19, 1953, at which time an application for a writ of habeas corpus was filed in the District Court of Santa Fe County, which was dismissed by the court. Smith was in no way misled as to the *1015 charge against him, and the misreference to the statute was not fatal to the information.

That a person may not be punished for a crime without a formal and sufficient accusation even if he voluntarily submits to the jurisdiction of the court cannot be questioned. Such is the undisputed law in all jurisdictions; but here as will be observed from reading § 14 of Article 2 of the Constitution requires the filing of a formal accusation, and admittedly such an accusation was filed in the present case. Petitioner was not deprived of his liberty without due process of law nor was he denied the equal protection of law guaranteed him by Article 2, Section 18 of the Constitution.

It follows from what has been said that the petition for a writ of habeas corpus should be denied.

It is so ordered.

McGHEE, C.J., and COMPTON and SEYMOUR, JJ., concur.

SADLER, J., absent from state, did not participate.

ALEXANDER v. COWART

ALEXANDER v. COWART.

No. 5749.

Supreme Court of New Mexico.

June 7, 1954.

Rehearing Denied July 7, 1954.

Lynell G. Skarda, Clovis, for appellant.

Quinn & Cox, Clovis, for appellee.

SEYMOUR, Justice.

Plaintiff sued defendant for property damage arising out of a two-vehicle collision some ten miles northwest of Espanola, New Mexico. Complaint was based upon defendant’s alleged negligence; defendant denied negligence and plead affirmative defenses of contributory negligence and last clear chance. Trial was had before the court without a jury and resulted in a judgment of $5,556.72, from which judgment defendant appeals.

The six points presented and argued by defendant may be classified generally as follows: (1) The first five points, addressed to defendant’s primary negligence, assert error as to findings of fact: (a) That certain of them are not supported by substantial evidence and are contrary to the *1006 physical facts; (b) That certain findings of fact requested by defendant were improperly refused. (2) The sixth point is addressed to the negligence of the plaintiff in support of the defenses of contributory negligence and last clear chance; the error here asserted is also directed at findings made or refused by the trial court. Further, appropriate conclusions of law flowing from the allegedly erroneous findings of fact are cited as error together with the refusal of conclusions of law requested by defendant.

Both of the vehicles were going south on U.S. highway 285, an unpaved highway approximately 24-feet wide, having a hard rock and sand surface. The accident happened in midafternoon of a clear, dry day on a level and straight section of the road. Defendant’s vehicle, with an overall length in excess of 70 feet, was comprised of an International tractor towing a low-boy with a Caterpillar tractor on it, in turn towing a carry-all loaded with an A-frame. Defendant was moving heavy contractor’s equipment under a special permit and was traveling at approximately 3 mph on his extreme right-hand side of the highway. The A-frame, used as a derrick upright in connection with the tractor, weighed some 2,000 pounds, was approximately 25 feet long, made of heavy 4-inch pipe, and was shaped, as indicated by its name, in the form of an “A.” The legs at the bottom of the “A” were about 4 feet apart; the A-frame was lying lengthwise on the carryall, the last of this string of vehicles, with the top or point of the “A” lashed down at the front of the carry-all, the legs projecting some 2 feet beyond the rear of defendant’s rig. The carry-all had 10-inch steel side-boards, between which the body of the A-frame was riding; however, the body of the A-frame was resting on the tail-gate at the rear of the carry-all; the record does not disclose how many inches the side-boards extended above this tail-gate; the record does show that the A-frame was not lashed down at its rear or where it rested on the tale-gate; that is, it was secured at only its forward end at the head of the carry-all.

Plaintiff’s vehicle was a GMC diesel truck pulling a Trailmobile van trailer full of vegetables; the over-all length was approximately 47 feet. The width of plaintiff’s vehicle was 7 feet, 7 inches, and the defendant’s vehicle at its widest point, the carry-all, was 9 feet, 11 1/4 inches.

Plaintiff’s vehicle overtook defendant’s rig and followed it for approximately 15 minutes or one quarter of a mile, until there was ample road visibility to insure passage safe from oncoming traffic. Plaintiff then sounded his horn, pulled to the left and attempted to pass, moving at a rate of approximately 5 mph.

As plaintiff attempted to pass defendant, the A-frame caught the diesel exhaust stack of plaintiff’s truck, bent it down, and then struck the front right-hand side of plaintiff’s refrigerator trailer approximately 12 feet above the ground, and proceeded to rip the skin or side of the trailer from front to rear parallel to the road; the result was as though the trailer had been opened by a giant can opener. Since the sidewalls of this refrigerator trailer were a principal support of the body of the trailer, the whole trailer collapsed on the ground and the vehicles came to a stop within a few seconds.

The significant findings of fact and conclusions of law given by the court and upon which defendant predicates error are as follows:

Findings of Fact: “10. That the A-Frame on defendant’s scraper was clearly visible to plaintiff’s driver and was seen by him. That said A-Frame was not seen to be skidding or sliding across the tail gate of the scraper, but just prior to this time a passenger bus driver, L.C. Ward, had been forced to pull off to the side of the road and stop to let defendant’s rig go by for the reason that this “A” frame was hanging over the side of the carryall and out into the road a distance of about four feet (4′).” “13. That as plaintiff’s driver attempted to pass in a legal and proper *1007 manner the “A” frame, which in some manner had either skidded on the tailgate or been thrown by the roughness of the road over the side of the carryall and out into the roadway and caught on the exhaust pipe of plaintiff’s tractor, and after bending the exhaust pipe down, caught in the extreme right front round corner of the refrigerated van and ripped the van open from the front almost to the rear.” “17. That when both vehicles had come to rest, plaintiff’s vehicle was on the extreme lefthand side of said roadway and was immovable, and defendant’s rig was on the extreme righthand side of the highway and ahead of the plaintiff’s rig far enough to allow a car to pass between the two rigs.” “19. That plaintiff’s driver operated plaintiff’s vehicle on the public highway in a careful, proper, prudent and legal manner.” Conclusion of Law: “2. That the defendant’s failure to properly secure the “A” frame to the carryall was the proximate cause of the damage to plaintiff’s rig.”

The trial court’s oral opinion at the conclusion of the hearing reflects the theory upon which the case was decided:

“The Court: The Court finds that some portion of the A-Frame having been so attached to the vehicle which was transporting it that it was able to protrude over into the oncoming lane of traffic for some distance, undoubtedly I would say as much as ten inches, when this accident occurred. I do not know that the flags or lack of flags would be material on that equipment. Persons using the highway with heavy wide equipment and a load of that sort they take up nearly all or half of the highway, and if some part of the cargo shifts or is able to shift and does so as to protrude into the lane of traffic of oncoming vehicles the person permitting such a condition to exist would be liable for any damage caused thereby unless there is some defense; I see none here. There is no doubt that the projection of some part of that A-Frame caused this damage. The testimony of the plaintiff’s driver which I think is reasonable as he was going around this other equipment at five miles per hour according to his statement I see no reason to doubt him. Obviously I would think he did not see the equipment projecting. Of course, he might have noticed it and gone beyond it at the time it slipped over far enough to gouge his trailer. He is amply corroborated by the witness Ward, the bus driver, who states in positive terms he saw this same vehicle with the A-Frame projecting into his lane of traffic and pulled over and stopped because of the apparent danger and there was no flags on it. I see nothing in this testimony to indicate that the plaintiff’s driver was guilty of any contributory negligence, he had his vehicle under control with due regard to the safety of the road, and nothing has been shown which would indicate any contributory negligence. The judgment will be for the plaintiff in the amounts detailed by him. There will be no award on account of exemplary or punitive damages because there is no proof here justifying such award.”

The first five points argued by appellant, defendant below, assert that there was no substantial evidence to support the court’s findings numbered 10, 13 and 17 quoted above, and that these findings were contrary to the physical facts.

A review of the record reveals specific testimony, subject to no objections on the part of the defendant, supporting each of the facts found by the court; for instance: plaintiff’s driver and the passenger bus driver, L.C. Ward, a disinterested witness, clearly testified to the facts recited in finding 10; there was no testimony directly attacking Ward’s story. As to finding 13, although there was no eyewitness at the moment of the damaging contact, the testimony of Ward comprehended in finding 10, together with undisputed testimony of others to the effect *1008 (1) that the A-frame was not lashed down at the rear, (2) that it could be moved around on the tail-gate by the strength of a single individual, (3) that the road was rough and had chuck holes, (4) that the A-frame caused the damage to plaintiff’s truck (testimony of defendant’s superintendent), constitutes substantial evidence to support such finding. There is similar exact testimony to support finding 17.

The foregoing means that the defendant, in order to sustain the alleged error, must show that these findings were contrary to the physical facts pursuant to the doctrine expressed as follows in the case of Ortega v. Koury, 1951, 55 N.M. 142, 227 P.2d 941, 942:

“Physical facts and conditions may point so unerringly to the truth as to leave no room for a contrary conclusion based on reason or common sense, and under such circumstances the physical facts are not affected by sworn testimony which in mere words conflicts with them. When the surrounding facts and circumstances make the story of a witness incredible, or when the testimony is inherently improbable, such evidence is not substantial.”

We find ourselves unable to accept defendant’s vigorous contention that the facts in this case as found by the trial court are “utterly at variance with well established and universally recognized physical laws.” Crocker v. Johnston, 1939, 43 N.M. 469, 95 P.2d 214, 217. The doctrine which defendant asks us to apply is well and strictly limited by this Court in the last cited case:

“It is not enough that, measured by the physical evidence, it seems improbable that the accident occurred as testified to by witnesses who saw it. The physical facts must so speak as to show the inherent improbability of it so occurring; or, in other words, to hold otherwise and against the import of these physical facts would be to find facts utterly at variance with well established and universally recognized physical laws. * * * Or, * * * a reasonable mind must reject the testimony of witnesses as `wholly impossible of belief’, in view of the physical evidence.”

In the instant case defendant argues that the weight of the A-frame, the height of the carry-all side-boards and the slow speed of his rig make it a physical impossibility for the A-frame to get outside of the retaining side-boards (except for an admitted possible projection of the legs up to 10 inches at the rear extremity of the load). We agree with the improbability of the A-frame jumping from the tail-gate over the side-board; however, defendant is faced with the specific testimony of a disinterested witness to this exact fact, i.e., Ward’s evidence as to a 4-foot projection; he is faced with his own failure to show the number of inches difference between the height of the side-board and the height of the tail-gate on which the A-frame was resting; and he is faced with the undisputed testimony that the A-frame was sufficiently movable to allow a single man to push it back and forth. With these facts in the record and the admitted character of the road, it would be presumptuous to state that it was physically impossible for the A-frame to move from side to side of the tail-gate or to jolt over the side of the carry-all and, as a result thereof, to project into the highway.

Defendant further contends that it was a physical impossibility for the two vehicles to come to rest on opposite sides of the road approximately 5 feet apart instead of something less than 2 feet apart as contended for by defendant. Obviously, on a 24-foot road with the combined width of the two vehicles totalling 17 feet, 6 1/4 inches, there remained substantially more than 5 feet of the highway which could be unoccupied by the two trucks. All the testimony concerning the position of the vehicles after they came to rest shows each to be on its own extreme side of the road. There is nothing impossible here. Defendant seems particularly concerned with the court’s finding 17 to the effect that a car passed between the two rigs. There was conflicting evidence on the distance between the two vehicles; however, the trial court’s finding states not only that *1009 each vehicle was on its own extreme side of the road, but also that defendant’s rig was “ahead of the plaintiff’s rig far enough to allow a car to pass between the two rigs.” There is nothing physically impossible about this.

In short, each of the objectionable findings has specific evidence, which if believed, would support the same. Further, these findings state no facts which necessarily violate the physical laws of nature. Under such circumstances, we have no alternative other than to reject the asserted error.

There are other findings objected to under these first five points of appellant, but we omit discussion of them for two reasons: They are either supported by substantial evidence or are immaterial to the decision in this case. In either event, there is no reversible error. The foregoing discussion has been in the light of existing decisions concerning the substantial evidence rule, some of which are: Renehan v. Lobato, 1951, 55 N.M. 532, 237 P.2d 100; Allen v. Allen, 1948, 52 N.M. 174, 194 P.2d 270; Kutz Canyon Oil & Gas Co. v. Harr, 1952, 56 N.M. 358, 244 P.2d 522; Southern Union Gas Co. v. Cantrell, 1952, 56 N.M. 184, 241 P.2d 1209; Petrakis v. Krasnow, 1949, 54 N.M. 39, 213 P.2d 220; Citizens Finance Co. v. Cole, 1943, 47 N.M. 73, 134 P.2d 550. As to the trial court’s refusal of appellant’s requested findings of fact, suffice it to say that the refused findings were diametrically opposed to or inconsistent with the facts properly found by the trial court in support of the judgment. Therefore, the refusal was not error. Wedgwood v. Colclazier, 1951, 55 N.M. 32, 226 P.2d 99; Bezemek v. Balduini, 1922, 28 N.M. 124, 207 P. 330.

We find no merit in defendant’s contention that Ward, a disinterested witness, and the driver of plaintiff’s equipment both testified that the point or top of the A-frame was at the rear of defendant’s rig rather than at the front thereof. There was positive testimony both ways and the trial court ultimately found that the point of the A-frame was at the front instead of at the back of the carry-all. There is no rule of law requiring a court to disregard all of the testimony of a witness simply because he finds certain of that testimony to have been incorrect.

The sixth point of appellant is based upon the defenses of contributory negligence and last clear chance, and relates to the following finding of fact and conclusion of law made by the court:

Finding of Fact: “19. That plaintiff’s driver operated plaintiff’s vehicle on the public highway in a careful, proper, prudent and legal manner.” Conclusion of Law: “2. That the defendant’s failure to properly secure the “A” frame to the carryall was the proximate cause of the damage to plaintiff’s rig.”

We shall eliminate the defense of last clear chance on the ground that there were no findings of fact made by the court or requested by the defendant which could make this doctrine applicable. Further, without deciding the question, we have grave doubt that the doctrine of last clear chance is available to the defendant as a defense. Rollman v. Morgan, 73 Ariz. 305, 240 P.2d 1196, 32 A.L.R.2d 543.

The burden of proof as to the plaintiff’s contributory negligence is on the defendant. Generally speaking, the defendant relies upon the alleged physical impossibility of the A-frame being thrown or jolted into a projecting position over the highway and beyond the side-board of the carry-all. There was substantial evidence to the effect that this had happened, which evidence we have already determined was not contrary to the physical laws of nature. Two further facts appear in the record: (1) That plaintiff was not yet following defendant’s rig at the time the bus driver stopped to avoid a 4-foot projection; (2) That, while plaintiff’s driver was following defendant’s rig, he saw nothing projecting over the side of this rig, nor did he see the A-frame skidding or sliding on the tailgate. The trial court, having these facts before it, found that “the A-frame, which in some manner had either skidded on the tail-gate or been thrown by the roughness *1010 of the road over the side of the carry-all and out into the roadway caught on the exhaust pipe of plaintiff’s tractor, and caught on the extreme right front round corner of the refrigerated van and ripped the van open from the front almost to the rear.” While the evidence is disputed as to how far apart the two vehicles were when they came to rest, the trial court found, on substantial evidence, that plaintiff’s vehicle was on the extreme left-hand side of the roadway, while defendant’s vehicle was on its own extreme side of the road. We have no right to speculate on the probability of what occurred. The burden of showing plaintiff’s contributory negligence was upon the defendant; the facts were in dispute. The trial court, feeling that appellant had failed to carry the burden of proving plaintiff’s negligence, refused to find contributory negligence; in so doing, he was justified. Whether or not the trial court made finding 19 concerning the due care of plaintiff is immaterial, since it was incumbent upon the defendant to carry the burden of proving plaintiff’s negligence in order to defeat recovery.

The court’s conclusion of law numbered 2 is not objectionable. It is based upon the findings of fact, with particular reference to those quoted, and to the further finding that the A-frame was not lashed down or secured at the end of defendant’s rig.

We find no fault with the court’s refusal to conclude as a matter of law that it was the duty of the rear driver, not only to make an audible signal, which the evidence indicates was done, but to actually receive acknowledgment of such signal by the front driver. Such a rule of law requires an unjustified extension of § 68-512(c), N.M.S.A. 1941.

Concerning other cited statutes relevant to the duties of the driver of an overtaking vehicle, defendant has failed to show any violation or omission by plaintiff. In all of these contentions defendant relies upon his thesis that it was a physical impossibility for the A-frame to move suddenly and project further into the highway at the moment plaintiff was passing. He reasons, therefore, that the accident was necessarily the fault of the plaintiff in negligently cutting into the stationary A-frame. Since we have determined to our own satisfaction that it was not a physical impossibility, defendant’s contentions must fail.

Judgment of the trial court is affirmed.

It is so ordered.

McGHEE, C.J., and COMPTON and LUJAN, JJ., concur.

SADLER, J., absent from the state, did not participate.

SAVE-RITE DRUG STORES, Inc. v. STAMM et al.

SAVE-RITE DRUG STORES, Inc. v. STAMM et al.

No. 5731.

Supreme Court of New Mexico.

June 7, 1954.

Irwin S. Moise and Lewis R. Sutin, Albuquerque, for appellant.

Simms & Modrall, Vance Mauney, Albuquerque, for appellees.

McGHEE, Chief Justice.

The appellant is lessee of a building owned by appellees, where appellant operates a department drug store. The lease contains the following provisions, among others:

“Article II “Use of Premises “With the appurtenances to be used for a retail drug department store. “Article III “Term and rent “To have and to hold * * * to pay the said Lessor as rent for the said described premises, the sum of Fifteen Hundred Dollars per month as a minimum rental * * *. In the event the gross sales of Lessee, as hereinafter defined, during any lease year, are in excess of $750,000.00, then and in that event Lessee agrees to pay Lessors an additional rental over and above the minimum monthly rental, in an amount equal to three per cent of the excess over and above $750,000.00 of said gross sales. “2. Lessee agrees that the premises demised hereby shall be used at all times during the term of this lease as a retail drug department store, carrying such merchandise and doing such business as is usual in retail drug department store. * * * * * * “6. It is understood that the Lessee shall remodel and alter the building according to plans and specifications to be prepared by the Lessee and approved by the Lessors prior to the time the work is commenced, * * *. “Article VI “Assignments or sub-leases “Fourth: And it is further agreed that * * * provided always that no part of the demised premises shall be sub-leased, used, or permitted to be used by any person whomsoever except for the sale of merchandise usually kept for sale by a department drug store. This special consent to sublet shall not be construed to confer a consent to any further or different or other subletting of the demised premises.”

The appellant proposed to sublease to Everitt Jewelry Company a portion of the store room 14 3/4 feet by 58 feet, with a door opening to the street for the operation of a jewelry store, as well as a door into the principal store room, but the appellees refused to consent to such sublease unless the percentage of sales going to them *397 was increased, on the ground such a jewelry department was beyond that contemplated by the lease. In other words, the appellees claimed such an operation would be larger than the jewelry department of a department drug store, and that such would violate the terms of the lease; the appellant contends the contrary.

To settle the controversy, the appellant brought suit for a declaratory judgment establishing their right to so sublease a part of the store room.

The trial court made the following findings of fact, as amended, and conclusions of law:

“Findings of Fact “I. The plaintiff is a New Mexico corporation, with its principal office in Bernalillo County, New Mexico; the defendants are residents of Bernalillo County, New Mexico; the real estate herein referred to lies within said county. “II. The plaintiff is the tenant as assignee of the original lessee of a lease and leasehold estate at 318 West Central Avenue, Albuquerque, New Mexico, pursuant to lease dated May 16, 1947, and assignment of lease dated July 19, 1949, a copy of each of which is annexed to the complaint herein, as Exhibits `A’ and `B’ hereof. The defendants are lessors upon said lease. “III. The leased premises are approximately 50 feet front by 142 feet depth and are located in the most valuable business area in Albuquerque. They are divided by a wall into two rooms, an east room about 14 3/4 feet in width, and the main store room, which is about 35 1/4 feet in width. Two portals connect the two rooms. There is a doorway into the store from the main store room and another doorway into the street from the east room. This structural set-up was agreed upon between the lessors and the present lessee’s predecessor. “IV. Formerly an actual controversy existed between the parties, in that the defendants denied that the plaintiff had the right under the lease to repair and put in tenantable condition the part of the premises which has been referred to by the parties as the east room thereof; but by their pleading in the present cause the defendants have conceded the plaintiff’s right to make the foregoing changes. “V. An actual controversy still exists between the parties in that the plaintiff asserts and the defendants deny that the plaintiff has a right under said lease to sublease the forward part of said east room area (approximately 58 feet x 14 3/4 feet) to Everitt Jewelry Company, of Albuquerque, New Mexico, which is to conduct said area as a jewelry department. “VI. That certain plans and specifications introduced in evidence herein indicate that such plans submitted by plaintiff’s assignor and approved by defendants contemplated erection of a soda fountain and lunch counter in a portion of the premises herein sought to be used by Everitt Jewelry Company. “VII. That Everitt Jewelry Company is a copartnership, and that one of the partners, Ralph Redak, is one of the principal stockholders in Save Rite Drug Stores, Inc., of New Mexico, the plaintiff in this case. “VIII. That Everitt Jewelry Company was, for a period of many years, operated as one of the largest and principal jewelry stores in Albuquerque, New Mexico, but for the last few years, has been operated and conducted within the premises operated by the Payless Drug Store. “IX. That it is not customary in the vicinity of Albuquerque, New Mexico, for large drug stores to have large jewelry departments handling expensive jewelry such as watches, diamonds, silverware, and similar jewelry merchandise. “X. That the small jewelry department heretofore operated in connection with Save Rite Drug Store in the *398 leased premises, was operated only after the consent of these defendants had been obtained therefor. “XI. That the conduct of a jewelry business in the eastern portion of the leased premises in a space approximately 14 3/4 feet by 58 feet, by a separately established jewelry business such as Everitt Jewelry Company, and served by a separate entrance to Central Avenue, is not such an operation as is customarily carried on by a department drug store. “Conclusions of law “I. That the proposed operation of plaintiff in connection with its proposed lease of the eastern portion of the leased premises to Everitt Jewelry Company as a department of Save Rite Drug Stores, Inc., of New Mexico, is not authorized under the terms of the lease existing between the plaintiff and defendants.”

Judgment was entered in favor of the appellees (lessors) and this appeal followed.

Following the submission of the cause here, we directed the trial court to make additional findings of fact in response to the following inquiry:

“Does the merchandise proposed to be sold by the Everitt Jewelry Company in the leased building differ in any substantial respect from what is usually kept for sale in a retail department drug store, and, if so, to what extent and in what respects?”

The following additional findings of fact were made and certified to us:

“XII. That the merchandise proposed to be sold by the Everitt Jewelry Company, as sublessee of plaintiff, Save Rite Drug Stores, Inc., differs substantially from what is usually kept for sale in a retail department drug store in the following particulars: “a. Selection of diamonds, rings and high grade watches and other lines of merchandise found in either Zales, Mindlins or Foggs Jewelry Stores in Albuquerque, New Mexico, are sold by Everitt Jewelry Company. “b. Appliances sold on credit are sold by Everitt Jewelry Company. “c. Department drug stores in Albuquerque, New Mexico, with jewelry departments sell costume jewelry of the One Dollar ($1.00) value and in-expensive watches up to $11.95 each, but no diamonds or expensive watches. “d. Department drug stores in other parts of the country sell costume jewelry, fountain pens, alarm clocks, some small appliances, but no diamonds, expensive watches or rings. “e. Everitt Jewelry Company as it is located in Payless Drug Store in Albuquerque, New Mexico, sells certain items of merchandise which the Payless Drug Store also sells directly across the aisle in the same store on the same premises. “f. It is unusual in department drug stores to find the same items of merchandise sold in the jewelry department of the department drug store and across the aisle in the same store on the same premises, to find the same items of merchandise also displayed for sale. “g. Zales, Mindlins and Foggs Jewelry Stores are each credit jewelers selling diamonds, high grade watches, rings and other items normally found in quality, credit jewelry stores. “h. Everitt Jewelry Company does an extensive credit business. “i. Department drug stores in Albuquerque, New Mexico, and in other parts of the country do no credit business but operate on a cash basis only.”

The appellant in its brief-in-chief makes strong attacks on the findings of fact which came to us regularly in the transcript, and also complains of the failure of the trial court to grant numerous findings of fact requested by it, which, it says, are uncontroverted in the record. This latter claim is true, but we find the trial court made the findings of fact necessary *399 to a determination of the case, and the fact that it failed to make requested findings which would not affect the outcome is not reversible error. Wiggs v. City of Albuquerque, 1953, 57 N.M. 770, 263 P.2d 963.

The appellant claims the supplemental findings certified to us after the submission of the case go beyond the inquiry made and that some are not germane to the issues raised and therefore should not be considered. This may be true of one or two, but they do not affect the result.

It is clear from the findings that the type of merchandise sold by Everitt Jewelry Company differs materially from the stock of jewelry usually kept for sale in a department drug store, as detailed in the supplemental findings, and the proposed sublease would be violative of the terms of subparagraph 2 of Article III of the lease quoted above, so the principal question is whether such findings are sustained by substantial evidence.

An examination of the record in this case satisfies us the findings are so sustained. Indeed, the record is convincing that if the appellant prevails there will be a large, first-class jewelry store operating in the building, rather than a jewelry department such as is usually found in a department drug store.

The appellant has cited cases from many jurisdictions showing tenants are favorites in the law, and that a business lease is construed strongly against the owner, to the end wide use may be made of the building by one paying the rent therefor, but we feel that under the facts of this case, it would do violence to the terms of the lease to reverse the judgment heretofore rendered.

The appellant also urges upon us the fact department drug stores are constantly adding new lines of merchandise and enlarging their stocks, citing authorities in support of the claim. We know this contention is true, and the writer would not be unduly surprised to see a tractor offered for sale in one of these stores, but, even so, the lease does not permit the operation of the jewelry store Everitt Jewelry Company would place in the leased building.

The judgment will be affirmed, and it is so ordered.

COMPTON and LUJAN, JJ., concur.

SEYMOUR, J., not participating.

SADLER, J., absent from the state, did not participate.

DAY v. PENITENTIARY OF NEW MEXICO

DAY v. PENITENTIARY OF NEW MEXICO.

No. 5760.

Supreme Court of New Mexico.

June 14, 1954.

H.A. Kiker and Henry A. Kiker, Jr., Santa Fe, for appellant.

Richard H. Robinson, Atty. Gen., Fred M. Standley, C.C. McCulloh, Asst. Attys. Gen., for appellee.

COMPTON, Justice.

Appellant, claimant below, brought this action against The Penitentiary of New Mexico for compensation under the Workmen’s Compensation Act and from a judgment dismissing the complaint, he appeals. The parties stipulated as to the facts found by the court, leaving for determination a single legal question, whether the state has consented to the suit.

*832 On November 20, 1950, while claimant was performing guard duty at the Penitentiary of New Mexico, a riot occurred among the prisoners during which the prisoners assaulted claimant, seriously injuring him. As a result of his injuries claimant was disabled to the extent of 60% of total disability. Appellee took no step to comply with the Act, hence there was no insurance carrier. Nor did appellee file a notice in writing of its election not to accept the provisions of the Act. Upon the foregoing fact, the court concluded that it was without jurisdiction in the matter since the action was one against the State of New Mexico to which the state had not consented, and dismissed the proceedings.

Appellant concedes the state cannot be sued without its consent, but contends that § 45-101, 1941 Comp., and the Workmen’s Compensation Statutes, § 57-901 to § 57-931, 1941 Comp., taken together, constitute a consent by the state to be sued in a Workmen’s Compensation proceeding involving the state penitentiary. This argument is without force as the statutes clearly are unrelated. The former deals with corporate powers, while the latter statutes are sui generis and exclusive. The rights and remedies provided thereby are in derogation of the common law and consent must be found in the Act itself. Hathaway v. New Mexico State Police, 57 N.M. 747, 263 P.2d 690; Vigil v. Penitentiary of New Mexico, 52 N.M. 224, 195 P.2d 1014; Hudson v. Herschbach Drilling Co., 46 N.M. 330, 128 P.2d 1044; Guthrie v. Threlkeld Co., 52 N.M. 93, 192 P.2d 307; Lipe v. Bradbury, 49 N.M. 4, 154 P.2d 1000; Sorenson v. Six Companies, Inc., 53 Ariz. 83, 85 P.2d 980; Brownfield v. Southern Amusement Co., 196 La. 73, 198 So. 656.

The penitentiary was given corporate powers by § 45-101, 1941 Comp., which reads:

“The general government and management of the penitentiary shall be vested in five (5) commissioners, who shall be appointed by the governor as in the constitution provided, and the governor shall have power at any time to remove any of said commissioners and appoint their successors. Said commissioners, and their successors in office, shall constitute a body corporate under the name and style of `The Penitentiary of New Mexico,’ and said corporation shall have the right as such to sue and be sued, to contract and be contracted with, to buy, own, hold, manage, lease, sell and otherwise handle and dispose of all such real, personal and mixed property as in the judgment of the commissioners may be necessary and proper for the operation and management of the penitentiary, including the right to acquire, maintain and operate any necessary farm, or farms, at such places in this state as the commissioners shall designate.” (Emphasis ours.)

The Workmen’s Compensation Act, § 57-902, enumerates the employers who do or may come within the provision of the Act, “the state and each county, city, town, school district, drainage, irrigation or conservancy district, and public institution and administrative board thereof * * *” and by § 57-910, all guards employed by the penitentiary are deemed to be within the provisions of the Act. By § 57-904 of the Act, every employer employing as many as four or more persons, is conclusively presumed to have accepted the provisions of the Act unless he has filed with the clerk of the district court a notice in writing that he elects not to accept its provisions. But we do not find in the Act express consent by the state to be sued, absent which the court was without jurisdiction to entertain the suit.

These statutes have been before this court and the question posed has been settled adversely to appellant.

In Vigil v. Penitentiary of New Mexico, supra [52 N.M. 224, 195 P.2d 1016], we said:

“* * * the power conferred upon such public corporations as are under consideration, `to sue and be sued,’ is not a power to sue and be sued for any cause of action, whether in contract or tort, but to sue and be sued upon such matters only as are within the scope of the other corporate *833 powers of such an institution, * * *. “We think any language in Locke v. Trustees, [of New Mexico Reform School], supra, [23 N.M. 487, 169 P. 304], or Dougherty v. Vidal, supra, [37 N.M. 256, 21 P.2d 90], to the effect or tending to hold that mere corporate status of a state agency is determinative of the question of whether a suit against it is a suit against the state is erroneous and is hereby disapproved and overruled. “We also hold that the permission granted to such corporation to sue and be sued does not include the right to sue them in tort.” (Emphasis ours.)

The question was recently treated in Hathaway v. New Mexico State Police, supra [57 N.M. 747, 263 P.2d 697]. The court on rehearing, reversed the judgment as to the state, in the following language:

“The claimant (appellee) resists the suggestion of amicus curiae that the judgment should be vacated in so far as it awards recovery against the state. His counsel make the contention that the state has in fact consented to be sued under the provisions of the Workmen’s Compensation Act. But we find in the act no express consent by the state to be sued and the consent is not to rest on implication. Unquestionably, the suit as to the employer is one against the state.” (Emphasis ours.)

Also see Parr v. New Mexico State Highway Department, 54 N.M. 126, 215 P.2d 602; New Mexico State Highway Department v. Bible, 38 N.M. 372, 34 P.2d 295.

The judgment should be affirmed, and It Is So Ordered.

McGHEE, C.J., and LUJAN and SEYMOUR, JJ., concur.

SADLER, J., absent from the state, did not participate.

PILLSBURY et al. v. BLUMENTHAL et al.

PILLSBURY et al. v. BLUMENTHAL et al.

No. 5756.

Supreme Court of New Mexico.

June 17, 1954.

Rehearing Denied July 13, 1954.

*327 Merritt W. Oldaker, Roy F. Miller, Jr., Albuquerque, for appellants.

Allen M. Tonkin, John E. Hall, Joseph T. Cole, Jr., Albuquerque, for appellees.

COMPTON, Justice.

Appellees, plaintiffs below, instituted this action for damages for breach of contract. The complaint charges that appellants failed to properly complete the construction of a residence according to the terms of the contract. Issue was joined by general denial and the following special defenses were asserted: (a) the complaint failed to state a claim upon which relief could be granted; (b) that arbitration was a condition precedent to any right of action; (c) acceptance of the work by appellees constituted a waiver; and (d) appellees’ failure to mitigate the damages. From an adverse judgment, appellants are here asserting error.

The trial court made the following findings:

“1. That under date of January 21, 1947, the plaintiffs, Mary Elizabeth Pillsbury and Videl Hudler, as owners, entered into a written contract with the defendants E.H. Blumenthal, Jr. and Carlyle G. Blumenthal, d/b/a Blumenthal Brothers’ Construction Company, as contractors, whereby said defendant-contractors would construct a residence for said plaintiffs as 125 Bergquist Drive, Albuquerque, New Mexico. “2. Under the terms of said contract, the defendants agreed, among other things, to furnish all materials, skill and judgment necessary for the proper construction and completion of the house in question. In effect, they agreed to construct the house with good materials and in a workmanlike and skillful manner. They also understood that the entire matter was being left in their hands and that a relationship of trust and confidence existed between the parties. “3. That by the terms of said contract the defendant-contractors agreed to bear the cost because of any defective work. “4. That as provided by said contract and under date of February 22, 1947, said defendant-contractors, together with their surety, the defendant United States Fidelity and Guaranty Company, executed and delivered to said plaintiffs a performance bond in the amount of $13,500.00, guaranteeing the faithful performance of said contract. “5. That the plaintiffs have performed all of the conditions of said contract required of them to be done. “6. That the plaintiffs have paid all sums required by them to be paid, the last payment having been made as of July 27, 1947. “7. The defendants breached said agreement in that they did not construct said house with proper materials or in a workmanlike and skillful manner. The house is cracked from one end to the other and in every room. These cracks are caused by defects in the structure as well as by the use of green lumber and blocks. “8. The following defects were caused by the defendants’ failure to comply with the terms of the contract: *328 (a) There is one crack through the entire wall in the southwest corner of the building and another crack through the wall in the northwest corner. You can see in and out of the building through these cracks. It will cost $300 to repair them. (b) There are cracks in all of the other rooms that will have to be patched and then all of the rooms will have to be repainted at a cost of $500.00. (c) Because of the uneven settlement of the foundation and use of inferior lumber, the floors are not level and have buckled in spots and will have to be leveled, sanded and refinished at a cost of $350.00. (d) Because of the settlement and use of inferior lumber the doors are warped and will not close and will have to be repaired at a cost of $150.00. (e) The windows and garage roof were not properly installed and as a result it will be necessary to sand, putty and complete caulking of the windows and puttying of the exterior trim and also to properly repair the garage roof at a cost of $175.00. (f) The cement slab in front of the house is cracked and not properly finished which will cost $25.00 to repair. “9. The plaintiff never accepted or waived said breaches of the contract by the defendants. “10. That the plaintiffs have done nothing that caused or contributed to the defects or omissions complained of and above found to exist.”

The court concluded that appellees had been damaged in the amount of $1,500 and entered judgment accordingly.

It is first argued that a demand to arbitrate and the filing of notice thereof with the architect and contractors is a condition precedent to the bringing of the action. The contract provides that the contractors should furnish a performance bond which was done by appellant, United States Fidelity and Guaranty Company. The terms of the bonds furnished by it provide that unless the building contract is executed upon The Standard Documents of The American Institute of Architects, all disputes, claims and questions arising under the contract shall be subject to arbitration in accordance with the provision of article 40 of the general conditions of the contract for the construction of buildings contained in the Fifth Edition of such Standard Documents. Article 40, referred to, in part reads:

“Art. 40. Arbitration: All disputes, claims or questions subject to arbitration under this contract shall be submitted to arbitration in accordance with the provisions, then obtaining, of the Standard Form of Arbitration Procedure of The American Institute of Architects, and this agreement shall be specifically enforceable under the prevailing arbitration law, and judgment under the award rendered may be entered in the highest court of the forum state or federal, having jurisdiction. It is mutually agreed that the decision of the arbitrators shall be a condition precedent to any right of legal action that either party may have against the other. “The Contractor shall not cause a delay of the work during any arbitration proceeding, except by agreement with the owner. “Notice of the demand for arbitration of a dispute shall be filed in writing with the Architect and the other party to the contract. If the arbitration is an appeal from the Architect’s decision, the demand therefor shall be made within ten days of its receipt, in any other case the demand for arbitration shall be made within a reasonable time after the dispute has arisen; in no case, however, shall the demand be made later than the time of final payment, except as otherwise expressly stipulated in the contract.”

The authorities are in accord that parties may agree to make arbitration a condition precedent to suit, McCoy and Dunlavy v. Torrance County Sav. Bank, 19 N.M. 422, 144 P. 283, but the burden in this instance was upon appellants to establish such affirmative defense by showing a *329 complete and enforceable arbitration agreement. Perhaps the Standard Form of The American Institute of Architects makes adequate provisions for arbitration; however, it was not offered in evidence nor considered by the trial court. In such case it cannot be considered on appeal.

It is asserted the court erred in denying the motion to dismiss the complaint for failure to state a claim upon which relief can be granted. In a determination of this question the complaint must be construed in a light most favorable to appellees and with all doubts resolved in favor of its sufficiency. Michelet v. Cole, 20 N.M. 357, 149 P. 310; State ex rel. Burg v. City of Albuquerque, 31 N.M. 576, 249 P. 242; In re Trigg, 46 N.M. 96, 121 P.2d 152; In re Morrow’s Will, 41 N.M. 723, 73 P.2d 1360; Parker v. Beasley, 40 N.M. 68, 54 P.2d 687; Leimer v. State Mutual Life Assurance Co., 8 Cir., 108 F.2d 302. While the complaint may be subject to criticism but as against a motion to dismiss, it is sufficient. It alleges the contractors failed to properly complete the work, a violation of the rights of appellees, damages resulting therefrom and a demand for relief. Had appellants entertained any misgivings as to the claim asserted, motion to make more definite and certain was available to them.

In Michelet v. Cole [20 N.M. 357, 149 P. 312], supra, we held:

“An objection to a complaint, or a cross-complaint, that it does not state facts sufficient to constitute a cause of action is good only when there is a total failure to allege some matter which is essential to the relief sought, and is not good when the allegations are simply incomplete, indefinite, or statements of conclusions of law or fact.”

The sufficiency of the pleading was sustained in State ex rel. Burg v. City of Albuquerque, supra [31 N.M. 576, 249 P. 247], in the following language:

“In testing the sufficiency of the writ, as aided by the answer, to state a cause of action, we should not overlook the established rule that a complaint is to be held good unless there is failure to allege some matter essential to the relief. It is not to be held insufficient because of incompleteness or indefiniteness of its allegations or because it states conclusions.”

It is further argued that acceptance of the work by the owners bars any subsequent action for breach of the contract. It is generally held that acceptance by the owner of work done under the construction contract constitutes a waiver of subsequent actions against the contractor or his bond for breach of the contract but this rule has its exception where defects are latent and are not reasonably discoverable by inspection. When appellees accepted the work and took possession there were no apparent defects, except minor defects deemed unimportant by them; but the defects complained of both in workmanship and material were hidden and became apparent subsequently. These defects are reflected by the testimony of the witness Burk, an architect, who testified:

“Q. Mr. Burk, explain to the Court in a general way what condition you found the premises to be in on the first visit there? A. On the first visit I made to that residence I found that “The Court: Was that in 1947? A. Yes, I found that there were innumerable cracks in the building proper, that the condition of the flooring was one that I would say certainly was not acceptable condition for new flooring. There had been excessive leaking about the windows. There were some windows apparently should have been installed on the back porch, which the work was not completed. There was a crack in the slab in front of the building, and there were some patches of the exterior of the building that needed completion, paint that didn’t match the existing color. I believe to be specific about cracks I would say that in the southwest bedroom was the worst crack, and at that time I examined that crack by examining the building inside and out, and under the floor, I found the crack to continue completely through the foundation *330 wall and total vertical height of the building. Examination of the method of installation of windows showed that it was contrary to the recommendations of the manufacturers of such sash, and the general finish condition of the interior painting was of an inferior class according to high standards. “Q. Do you remember offhand the nature of your recommended repairs and their costs? A. I think I recommended that the footing condition of that southwest corner of the building would have to be examined and the building would have to be jacked and shored into place, and suitable footing placed under it with associated repairs. Many plaster and stucco repairs would have to be made. The window stucco would have to be removed and installed under the sash rather than against the sash to prevent continued leaking. I recommended removal and replacement of the flooring. I think I recommended refinishing the front slab, refinishing of some interior trim. I think the order of that amount was around $1,800.00.”

The alleged failure of appellees to mitigate the damages is assigned as error. In this respect it is the duty of a party to use reasonable diligence to mitigate damages about to be suffered from a breach of contract. Appellants do not point out how the damages could have been mitigated. Nevertheless, they do say that had appellees patched the cracks with plaster, additional cracks might have been prevented. This is pure speculation and such speculative, uncertain and contingent possibilities cannot be taken into consideration in mitigation of damages. In response to a question by the court the witness Ellis responded:

“The Court: If you have a crack clear through the wall from the top to the bottom, then the foundation is what usually causes that? A. That is what I was explaining on the other. It is settlement of the building. The average plaster is five-eights of an inch, and it will only carry its own weight, no part of the weight of the building. * * *.”

Other points are urged for a reversal but these challenge the sufficiency of the evidence to support the finding and it would serve no beneficial purpose to discuss the facts further. However, from our examination of an 800 page record, we are satisfied the findings are substantially supported.

The judgment should be affirmed, and it is so ordered.

McGHEE, C.J., and LUJAN and SEYMOUR, JJ., concur.

SADLER, J., absent from the state, did not participate.